<PAGE>
<PAGE>
SEMI-ANNUAL REPORT
- -------------------------------------------
April 30, 1996
NEUBERGER&BERMAN
MUNICIPAL FUNDS -Registered Service Mark-
Neuberger&Berman
MUNICIPAL MONEY FUND
Neuberger&Berman
MUNICIPAL SECURITIES TRUST
Neuberger&Berman
NEW YORK INSURED INTERMEDIATE FUND
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S> <C>
THE FUNDS
PRESIDENT'S LETTER 4
PERFORMANCE
HIGHLIGHTS 9
RATINGS SUMMARY 10
FINANCIAL STATEMENTS 12
FINANCIAL HIGHLIGHTS
PER SHARE DATA
Municipal Money Fund 20
Municipal Securities
Trust 21
New York Insured
Intermediate Fund 22
THE PORTFOLIOS
SCHEDULE OF
INVESTMENTS
Municipal Money
Portfolio 24
Municipal Securities
Portfolio 35
New York Insured
Intermediate Portfolio 40
FINANCIAL STATEMENTS 44
FINANCIAL HIGHLIGHTS 51
OTHER INFORMATION
Directory/Officers and
Trustees 54
</TABLE>
3
<PAGE>
PRESIDENT'S LETTER June 17, 1996
Dear Shareholder,
When we last reported to you, in your Fund's October 1995 Annual Report,
interest rates were falling and the bond market was in the midst of one of its
strongest rallies in over a decade. The economic environment remained relatively
subdued through the end of 1995, and prices of corporate, government, and
municipal bonds continued to increase.
Early in the first quarter of 1996, however, this positive trend for bonds
began to reverse itself due to a steady flow of positive economic data. The
economy, as measured by real gross domestic product (real GDP is the total
output of goods and services in the U.S., adjusted for inflation), grew at an
annualized rate of 2.8% through the first quarter, which was much higher than
expected. In addition, a February jobs report showed stronger-than-expected
growth in non-agricultural jobs, causing the biggest one-day rise in long-term
interest rates since the Gulf War in August of 1990.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
DESCRIPTION: GRAPH DEPICTING RELATIVE YIELDS OF THE 30 YEAR TREASURY BOND,
TREASURY BILLS AND MERRILL LYNCH 12-22 YEAR MUNICIPAL BOND INDEX FOR THE TIME
PERIOD NOV. 1, 1995 - APRIL 30, 1996
<TABLE>
<CAPTION>
THREE-MONTH
TREASURY BONDS TREASURY BILLS MUNICIPAL BONDS
<S> <C> <C> <C>
11/1 6.30 5.46 5.50
11/2 6.24 5.39 5.43
11/3 6.28 5.42 5.44
11/6 6.29 5.47 5.42
11/7 6.31 5.50 5.42
11/8 6.25 5.43 5.35
11/9 6.28 5.44 5.36
11/10 6.34 5.50 5.39
11/13 6.28 5.46 5.37
11/14 6.29 5.45 5.40
11/15 6.29 5.50 5.42
11/16 6.22 5.45 5.35
11/17 6.23 5.43 5.34
11/20 6.25 5.44 5.37
11/21 6.27 5.47 5.36
11/22 6.28 5.49 5.37
11/23 6.28 5.48
11/24 6.25 5.47 5.34
11/27 6.22 5.46 5.33
11/28 6.23 5.48 5.33
11/29 6.20 5.40 5.30
11/30 6.13 5.38 5.24
12/1 6.09 5.37 5.21
12/4 6.03 5.37 5.17
12/5 6.05 5.37 5.21
12/6 6.03 5.37 5.22
12/7 6.08 5.40 5.17
12/8 6.05 5.43 5.18
12/11 6.05 5.41 5.17
12/12 6.05 5.42 5.23
12/13 6.08 5.43 5.23
12/14 6.09 5.40 5.30
12/15 6.10 5.36 5.31
12/18 6.20 5.35 5.37
12/19 6.11 5.23 5.31
12/20 6.12 5.15 5.31
12/21 6.09 5.03 5.34
12/22 6.06 5.03 5.30
12/25 6.07 5.02
12/26 6.04 5.00 5.29
12/27 6.01 5.03 5.27
12/28 5.98 4.98 5.24
12/29 5.95 5.08 5.21
12/31 5.21
1/1 5.95 5.08
1/2 5.96 5.12 5.26
1/3 5.96 5.21 5.24
1/4 6.03 5.19 5.30
1/5 6.05 5.18 5.26
1/8 6.04 5.17 5.24
1/9 6.11 5.15 5.24
1/10 6.18 5.17 5.32
1/11 6.15 5.17 5.30
1/12 6.15 5.17 5.30
1/15 6.15 5.17 5.29
1/16 6.06 5.14 5.23
1/17 6.01 5.13 5.19
1/18 5.99 5.11 5.15
1/19 5.97 5.11 5.15
1/22 6.04 5.13 5.22
1/23 6.09 5.12 5.22
1/24 6.04 5.11 5.17
1/25 6.11 5.13 5.24
1/26 6.04 5.10 5.05
1/29 6.09 5.15 5.10
1/30 6.04 5.12 5.04
1/31 6.03 5.05 4.99
2/1 6.07 5.00 4.97
2/2 6.16 4.98 5.01
2/5 6.16 5.00 5.00
2/6 6.13 4.99 4.99
2/7 6.16 4.93 4.99
2/8 6.15 4.91 4.93
2/9 6.10 4.93 4.92
2/12 6.03 4.93 4.88
2/13 6.03 4.92 4.84
2/14 6.09 4.93 4.85
2/15 6.17 4.90 4.89
2/16 6.24 4.89 4.93
2/19 6.24 4.89
2/20 6.40 4.96 5.06
2/21 6.37 4.96 5.04
2/22 6.34 4.94 5.01
2/23 6.41 4.95 5.04
2/26 6.46 4.98 5.07
2/27 6.48 5.02 5.10
2/28 6.47 5.01 5.12
2/29 6.47 5.03 5.12
3/1 6.37 5.00 5.12
3/4 6.33 5.03 5.08
3/5 6.38 5.03 5.11
3/6 6.45 5.03 5.14
3/7 6.46 5.03 5.15
3/8 6.71 5.03 5.37
3/11 6.64 5.10 5.38
3/12 6.67 5.10 5.41
3/13 6.68 5.12 5.40
3/14 6.69 5.12 5.40
3/15 6.74 5.15 5.49
3/18 6.71 5.18 5.47
3/19 6.72 5.21 5.49
3/20 6.64 5.14 5.43
3/21 6.62 5.06 5.42
3/22 6.66 5.11 5.44
3/25 6.58 5.07 5.37
3/26 6.58 5.15 5.36
3/27 6.68 5.16 5.41
3/28 6.72 5.19 5.41
3/29 6.67 5.14 5.36
3/31 5.36
4/1 6.63 5.16 5.21
4/2 6.60 5.17 5.21
4/3 6.63 5.15 5.21
4/4 6.67 5.12 5.21
4/5 6.82 5.16 5.21
4/8 6.87 5.16 5.50
4/9 6.83 5.09 5.47
4/10 6.95 5.09 5.48
4/11 6.94 5.10 5.49
4/12 6.80 5.08 5.49
4/15 6.79 5.00 5.37
4/16 6.79 4.97 5.35
4/17 6.81 4.96 5.35
4/18 6.83 5.00 5.35
4/19 6.79 5.03 5.36
4/22 6.75 5.00 5.32
4/23 6.78 5.11 5.33
4/24 6.82 5.14 5.33
4/25 6.80 5.10 5.35
4/26 6.79 5.12 5.31
4/29 6.84 5.16 5.34
4/30 6.91 5.15 5.37
</TABLE>
SOURCE: BLOOMBERG FINANCIAL MARKETS -- 30 YEAR TREASURY BOND & TREASURY BILLS
MERRILL LYNCH 12-22 YEAR MUNICIPAL BOND INDEX.
Other factors that contributed to the strength in the economy during the first
quarter were signs of increasing capital and government spending, including
higher personal-consumption and business-related purchases. Department store
sales and retailing stocks recovered from
4
<PAGE>
their late 1995 doldrums, auto sales rose, factory orders surged after a short
dip in February, requests for unemployment benefits dropped, and Americans
increased their borrowing pace. The economy remained strong despite the January
blizzards, a government shutdown, and a widespread strike by General Motors
employees.
In response to the mounting evidence that the economy was more robust than
expected, the yield on the long bond (the benchmark 30-year Treasury) jumped
from under 6% in January to nearly 7% by the end of April. As a result, the
total return of 30-year bonds through April 30, 1996 registered a 10.5%
decline.* Municipal bond returns declined less dramatically, as moderate new
issuance and rejuvenated confidence in municipal bonds' credit quality (since
the Orange County default of 1994) bolstered their standing in the overall bond
market. Mortgage-backed securities also lost value, but they were buoyed
slightly by reduced prepayment fears (home loan refinancing slows as interest
rates rise). Foreign bond markets performed only marginally better than the
domestic bond market, as the strengthening dollar and the condition of U.S.
bonds stifled their performance; high-yielding markets such as Australia, Italy,
and Sweden fared best while low-yielding foreign markets such as Japan, Germany,
and the U.K. did worse.
Shortly after the Semi-Annual Report period ended, lower bond prices and
temporarily diminished inflationary concerns incited a May rally in the bond
market. Although the recent volatility in the bond market may not inspire an
investor's desire to take on extra risk, we feel it's also not a time of
complete gloom and doom. We also believe these are times when fixed-income fund
investors should feel comfortable about their investments, whether rates exceed
7% this year or return to 1995 yield levels. So we are especially pleased to
report that your Neuberger&Berman Income Funds posted positive returns over the
six-month period ended April 30, 1996 and were proactively managed, especially
against the backdrop of rising interest rates.
We strive to merit your continued confidence and remain committed to providing
consistent performance in all market conditions. A discussion of each
Portfolio's strategy over the six-month period of the Semi-Annual Report
follows.
*SOURCE: SALOMON 30-YEAR TREASURY INDEX.
5
<PAGE>
MUNICIPAL MONEY FUND. Short-term municipal bond rates rose modestly over the
six-month period ended April 30, 1996 in response to sharply rising rates in the
Treasury bond market. Inflationary fears surfaced as economic data strengthened,
and it appeared that the Federal Reserve had finished easing monetary policy for
1996. In fact, we believe the Fed might even increase rates sometime this year.
In any event, we feel that tax-exempt yields will remain stable and, in our
judgment, the bulk of the rate rise is most likely behind us.
During the six-month period ended April 30, 1996, the weighted average
portfolio maturity for the Municipal Money Fund ranged from a high of 69.8 days
to a low of 42.3 days. The current and effective (compounded) yields for the
Fund as of April 30, 1996 were 3.00% and 3.04%, respectively. This can be
translated into tax-equivalent current and effective yields of 4.97% and 5.09%,
respectively for an investor in the highest federal income tax bracket.+
MUNICIPAL SECURITIES TRUST. The widespread selling of both municipal
securities and Treasuries that was incited by the bond market correction began
in February and continued through April. However, intermediate-term tax-exempt
securities fared better than most taxable bond types during that four-month
period and over the Semi-Annual Report period as a whole. The market benefited
from reduced speculation on tax reform, moderate new issuance (spurring demand
within a smaller supply), and diminishing concern with municipal credit quality
since the fallout over the Orange County default of 1994. These important
factors created what we believed was a lower-volatility environment in the face
of rising interest rates.
Our investment strategy in this environment was to shorten the Portfolio's
average duration (duration is a measure of the Portfolio's exposure to interest
rate risk) from 6.2 years to 5.6 years over the six-months ended April 30, 1996.
We continue to focus on high-quality issues. Keep in mind that even though the
market has corrected significantly since we last reported to you, we view any
significant corrections in the market as a buying opportunity. We also believe
the low supply of new municipal bonds may continue to be a positive performance
factor for the Portfolio, as bond buyers' demand could grow with the waning
availability of new issues.
6
<PAGE>
NEW YORK INSURED INTERMEDIATE FUND. Even though all fixed-income securities
produced lackluster returns during the six-month period ended April 30, 1996,
the municipal bond sector displayed impressive relative value. New tax-exempt
issuance plunged as rising interest rates curtailed refunding activity and
demand for these securities picked up as fears about a possible "flat tax"
diminished. New York municipal issues performed well compared to other areas of
the municipal market as high-grade municipal bonds in high-tax states such as
New York became scarce. The average duration (duration is a measure of the
Portfolio's exposure to interest rate risk) of the Portfolio was shortened over
the Semi-Annual Report period from 6.3 years to 5.2 years. This duration range
will most likely be maintained going forward. Although we feel the municipal
bond market offers value and potential opportunity at the current levels, we
also believe the possibility for continued volatility will persist in the
overall market in the months ahead.
Sincerely,
/s/ Theresa A. Havell
Theresa A. Havell
President and Trustee
Neuberger&Berman Income Funds
+Tax-equivalent yield is the taxable yield that an investor would have had to
receive in order to realize the same level of yield after federal taxes at the
highest federal tax rate, 39.6%, assuming that all of the Fund's income is
exempt from federal income taxes.
There is no assurance that Municipal Money Fund will be able to maintain a
stable net asset value of $1.00 per share. The value of the Fund's shares, like
the share values of all other mutual funds, is neither insured nor guaranteed
by the U.S. Government. The return on an investment in Municipal Money Fund
will fluctuate. Results represent past performance and do not indicate future
results.
7
<PAGE>
(This page has been left blank intentionally.)
8
<PAGE>
PERFORMANCE HIGHLIGHTS
<TABLE>
<CAPTION>
TOTAL RETURN ILLUSTRATION
SIX AVERAGE ANNUAL TOTAL
MONTH RETURNS(1)
PERIOD -------------------------
NEUBERGER&BERMAN INCEPTION ENDED SINCE
INCOME FUNDS DATE 4/30/96 1 YR(1) 5 YR INCEPTION
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
MUNICIPAL SECURITIES TRUST* 7/9/87 +0.94% +6.10% +5.99% +6.42%
NEW YORK INSURED INTERMEDIATE
FUND* 2/1/94 +0.39% +6.31% N/A +3.51%
</TABLE>
<TABLE>
<CAPTION>
YIELD ILLUSTRATION
FOR 7 DAYS ENDED 4/30/96
TAX-EQUIVALENT
INCEPTION DATE CURRENT YIELD(2) EFFECTIVE YIELD(2) EFFECTIVE YIELD**
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
MUNICIPAL MONEY FUND* 12/10/84 3.00% 3.04% 5.09%
</TABLE>
1)One year and average annual total returns are for periods ended April 30,
1996. Includes reinvestment of all dividends and capital gain distributions.
The Neuberger&Berman Income Funds (except New York Insured Intermediate Fund)
were reorganized in July, 1993. Performance and information for periods prior
to July, 1993 refer to the predecessors of the Funds. Results represent past
performance and do not guarantee future results. Investment returns and
principal may fluctuate and shares when redeemed may be worth more or less
than original cost.
2)"Current Yield" refers to the income generated by an investment in the Fund
over a 7-day period. This income is then "annualized." The "effective yield"
is calculated similarly but, when annualized, the income earned by an
investment in the Fund is assumed to be reinvested. The "effective yield"
will be slightly higher than the "current yield" because of the compounding
effect of this assumed reinvestment. Yields of a money market fund will
fluctuate and past performance is no guarantee of future results.
* Neuberger&Berman Management Inc. voluntarily bears certain operating expenses
in excess of .65% of the average daily net assets per annum of Municipal
Securities Trust and New York Insured Intermediate Fund. These arrangements
can be terminated upon 60 days' prior written notice to the appropriate Fund.
Absent such reimbursements, the total returns for the above stated periods
would have been +0.74%, +5.75%, +5.56%, and +5.31%, respectively, for
Municipal Securities Trust and -0.26%, +4.98%, and +2.43%, respectively, for
New York Insured Intermediate Fund.
There is no assurance that Municipal Money Fund will be able to maintain a
stable net asset value of $1.00 per share. The value of the Fund's shares,
like the value of shares of all other mutual funds, is neither insured nor
guaranteed by the U.S. Government. The return on an investment in Municipal
Money Fund will fluctuate.
** Tax-equivalent effective yield is the taxable effective yield that an
investor would have had to receive in order to realize the same level of
yield after Federal taxes at the highest Federal tax rate, 39.6%, assuming
that all of the Fund's income is exempt from Federal income taxes.
9
<PAGE>
RATINGS SUMMARY
The following table shows the ratings distribution for each Portfolio, the
dollar-weighted average portfolio maturity for Neuberger&Berman Municipal Money
Portfolio, and the dollar-weighted average portfolio duration for
Neuberger&Berman Municipal Securities Portfolio and Neuberger&Berman New York
Insured Intermediate Portfolio, each as of April 30, 1996. Ratings distribution,
average maturity, and average duration may change in the future.
<TABLE>
<CAPTION>
DOLLAR-WEIGHTED
PERCENT OF TOTAL AVERAGE PORTFOLIO
NEUBERGER&BERMAN MOODY'S RATINGS INVESTMENTS MATURITY
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Municipal Money Portfolio Aaa 7.2% 48.2 days
Aa, Aa1, Aa2 5.9
P-1 25.7
MIG-1/VMIG-1 42.3
N/R 18.9
-----
100.0%
<CAPTION>
DOLLAR-WEIGHTED
PERCENT OF TOTAL AVERAGE PORTFOLIO
NEUBERGER&BERMAN MOODY'S RATINGS INVESTMENTS DURATION
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Municipal Securities Portfolio Aaa 60.1% 5.6 years
Aa, Aa1 31.5
A, A1 7.2
P-1 .2
VMIG-1 .2
N/R .8
-----
100.0%
New York Insured Intermediate Portfolio Aaa 79.3% 5.2 years
Aa 2.0
Baa1 16.6
VMIG-1 2.1
-----
100.0%
</TABLE>
MOODY'S INVESTORS SERVICE, INC. (MOODY'S) CORPORATE BOND RATINGS:
AAA - Bonds rated AAA are judged to be of the best quality. They carry the
smallest degree of investment risk and are generally referred to as "gilt edge."
Interest payments are protected by a large or exceptionally stable margin, and
principal is secure. Although the various protective elements are likely to
change, the changes that can be visualized are most unlikely to impair the
fundamentally strong position of the issue.
AA - Bonds rated AA are judged to be of high quality by all standards. Together
with the AAA group, they comprise what are generally known as "high-grade
bonds." They are rated lower than the best bonds because margins of protection
may not be as large as in AAA-rated securities, fluctuation of protective
elements may be of greater amplitude, or there may be other elements present
that make the long-term risks appear somewhat larger than in AAA-rated
securities.
A - Bonds rated A possess many favorable investment attributes and are
considered as upper-medium grade obligations. Factors giving security to
principal and interest are considered adequate, but elements may be present that
suggest a susceptibility to impairment some time in the future.
BAA - Bonds rated BAA are considered medium-grade obligations (i.e., they are
neither highly protected nor poorly secured). Interest payments and principal
security appear adequate for the present, but certain protective elements may be
lacking or may be characteristically unreliable over any great length of time.
These bonds lack outstanding investment characteristics and in fact have
speculative characteristics as well.
10
<PAGE>
MOODY'S SHORT-TERM DEBT RATINGS:
Issuers rated PRIME-1 (P-1), or related supporting institutions, have a superior
capacity for repayment of short-term promissory obligations. PRIME-1 repayment
capacity will normally be evidenced by the following characteristics: leading
market positions in well-established industries; high rates of return on funds
employed; conservative capitalization structures with moderate reliance on debt
and ample asset protection; broad margins in earnings coverage of fixed
financial charges and high internal cash generation; and well-established access
to a range of financial markets and assured sources of alternative liquidity.
MOODY'S SHORT-TERM LOAN RATINGS:
ISSUERS RATED MIG-1/VMIG-1 - This designation denotes best quality. There is
present strong protection by established cash flows, superior liquidity support
or demonstrated broad-based access to the market for refinancing.
N/R - Not rated by Moody's.
NOTE: Moody's applies numerical modifiers, 1, 2, and 3, in each generic rating
classification from Aa through Baa in its corporate bond ratings system. The
modifier 1 indicates that the security ranks in the higher end of its generic
rating category; the modifier 2 indicates a mid-range ranking; and the modifier
3 indicates that the issue ranks in the lower end of its generic rating
category.
11
<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES
Neuberger&Berman April 30, 1996 (Unaudited)
- ----------------------------------------------------------------------
Income Funds
<TABLE>
<CAPTION>
NEW YORK
MUNICIPAL MUNICIPAL INSURED
MONEY SECURITIES INTERMEDIATE
(000'S OMITTED EXCEPT PER SHARE AMOUNTS) FUND TRUST FUND
------------------------------------------------
<S> <C> <C> <C>
ASSETS
Investment in corresponding Portfolio, at
value (Note A) $ 155,051 $ 40,945 $ 9,589
Deferred organization costs (Note A) -- -- 22
Receivable for Trust shares sold 15 28 56
Receivable from administrator -- net (Note
B) -- 6 8
------------------------------------------------
155,066 40,979 9,675
------------------------------------------------
LIABILITIES
Dividends payable 4 53 18
Payable for Trust shares redeemed 58 48 --
Payable to administrator (Note B) 37 -- --
Accrued expenses 36 36 29
------------------------------------------------
135 137 47
------------------------------------------------
NET ASSETS at value $ 154,931 $ 40,842 $ 9,628
------------------------------------------------
NET ASSETS consist of:
Par value $ 155 $ 4 $ 1
Paid-in capital in excess of par value 154,873 41,601 10,090
Accumulated net realized losses on
investment (97) (994) (362)
Net unrealized appreciation (depreciation)
in value of investment -- 231 (101)
------------------------------------------------
NET ASSETS at value $ 154,931 $ 40,842 $ 9,628
------------------------------------------------
SHARES OUTSTANDING
($.001 par value; unlimited shares
authorized) 155,028 3,817 977
------------------------------------------------
NET ASSET VALUE, offering and redemption price per
share $1.00 $10.70 $9.85
------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
12
<PAGE>
STATEMENTS OF OPERATIONS
Neuberger&Berman For the Six Months Ended April 30, 1996 (Unaudited)
- ----------------------------------------------------------------------
Income Funds
<TABLE>
<CAPTION>
NEW YORK
MUNICIPAL MUNICIPAL INSURED
MONEY SECURITIES INTERMEDIATE
(000'S OMITTED) FUND TRUST FUND
------------------------------------------
<S> <C> <C> <C>
INVESTMENT INCOME
Investment income from corresponding Portfolio
(Note A) $ 3,091 $ 1,060 $ 253
------------------------------------------
Expenses:
Administration fee (Note B) 228 58 14
Amortization of deferred organization and
initial offering expenses (Note A) -- -- 4
Auditing fees 4 4 4
Custodian fees 5 5 5
Legal fees 10 10 15
Registration and filing fees 22 18 --
Shareholder reports 15 13 10
Shareholder servicing agent fees 7 12 2
Trustees' fees and expenses 8 4 3
Miscellaneous 2 1 1
Expenses from corresponding Portfolio (Note
A) 308 100 48
------------------------------------------
Total expenses 609 225 106
Deduct -- expenses reimbursed by
administrator (Note B) -- (85) (70)
------------------------------------------
Total net expenses 609 140 36
------------------------------------------
Net investment income 2,482 920 217
------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
AND FINANCIAL FUTURES CONTRACTS FROM
CORRESPONDING PORTFOLIO (NOTE A)
Net realized gain (loss) on investments 4 167 (16)
Net realized loss on financial futures
contracts -- (51) --
Change in net unrealized appreciation
(depreciation) of investments -- (627) (149)
------------------------------------------
Net gain (loss) on investments and
financial futures contracts from
corresponding Portfolio (Note A) 4 (511) (165)
------------------------------------------
Net increase in net assets resulting from
operations $ 2,486 $ 409 $ 52
------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
13
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
Neuberger&Berman
- ----------------------------------------------------------------------
Income Funds
<TABLE>
<CAPTION>
MUNICIPAL
MONEY
FUND
Six Months
Ended Year
April 30, Ended
1996 October 31,
(000'S OMITTED) (UNAUDITED) 1995
-----------------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income $ 2,482 $ 4,904
Net realized gain (loss) on
investments and financial futures
contracts from corresponding
Portfolio (Note A) 4 (25)
Change in net unrealized
appreciation (depreciation) of
investments from corresponding
Portfolio (Note A) -- --
-----------------------------
Net increase in net assets resulting
from operations 2,486 4,879
-----------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (2,482) (4,904)
-----------------------------
FROM TRUST SHARE TRANSACTIONS:
Proceeds from shares sold 139,349 219,086
Proceeds from reinvestment of
dividends 2,449 4,853
Payments for shares redeemed (147,678) (213,408)
-----------------------------
Net increase (decrease) from Trust
share transactions (5,880) 10,531
-----------------------------
NET INCREASE (DECREASE) IN NET ASSETS (5,876) 10,506
NET ASSETS:
Beginning of period 160,807 150,301
-----------------------------
End of period $ 154,931 $ 160,807
-----------------------------
NUMBER OF TRUST SHARES:
Sold 139,349 219,086
Issued on reinvestment of dividends 2,449 4,853
Redeemed (147,678) (213,408)
-----------------------------
Net increase (decrease) in shares
outstanding (5,880) 10,531
-----------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
14
<PAGE>
- ----------------------------------------------------------------------
Income Funds
<TABLE>
<CAPTION>
NEW YORK
MUNICIPAL INSURED
SECURITIES INTERMEDIATE
TRUST FUND
Six Months Six Months
Ended Year Ended Year
April 30, Ended April 30, Ended
1996 October 31, 1996 October 31,
(UNAUDITED) 1995 (UNAUDITED) 1995
-------------------------------------------------------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income $ 920 $ 1,962 $ 217 $ 486
Net realized gain (loss) on
investments and financial futures
contracts from corresponding
Portfolio (Note A) 116 (677) (16) (95)
Change in net unrealized
appreciation (depreciation) of
investments from corresponding
Portfolio (Note A) (627) 2,886 (149) 938
-------------------------------------------------------------
Net increase in net assets resulting
from operations 409 4,171 52 1,329
-------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (920) (1,962) (217) (486)
-------------------------------------------------------------
FROM TRUST SHARE TRANSACTIONS:
Proceeds from shares sold 3,252 9,877 1,279 4,195
Proceeds from reinvestment of
dividends 616 1,227 121 190
Payments for shares redeemed (6,835) (20,106) (3,102) (8,459)
-------------------------------------------------------------
Net increase (decrease) from Trust
share transactions (2,967) (9,002) (1,702) (4,074)
-------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS (3,478) (6,793) (1,867) (3,231)
NET ASSETS:
Beginning of period 44,320 51,113 11,495 14,726
-------------------------------------------------------------
End of period $ 40,842 $ 44,320 $ 9,628 $ 11,495
-------------------------------------------------------------
NUMBER OF TRUST SHARES:
Sold 299 947 127 437
Issued on reinvestment of dividends 57 117 12 20
Redeemed (631) (1,956) (311) (900)
-------------------------------------------------------------
Net increase (decrease) in shares
outstanding (275) (892) (172) (443)
-------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
15
<PAGE>
NOTES TO FINANCIAL STATEMENTS
Neuberger&Berman April 30, 1996 (Unaudited)
- ----------------------------------------------------------------------
Income Funds
NOTE A -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
1) GENERAL: Neuberger&Berman Municipal Money Fund ("Municipal Money"),
Neuberger&Berman Municipal Securities Trust ("Municipal Securities Trust"),
and Neuberger&Berman New York Insured Intermediate Fund ("New York Insured
Intermediate") (collectively, the "Funds") are separate operating series of
Neuberger&Berman Income Funds (the "Trust"), a Delaware business trust
organized pursuant to a Trust Instrument dated December 23, 1992. The Trust
is registered as an open-end management investment company under the
Investment Company Act of 1940, as amended, and its shares are registered
under the Securities Act of 1933, as amended. The trustees of the Trust may
establish additional series or classes of shares without the approval of
shareholders.
The assets of each series belong only to that series, and the liabilities
of each series are borne solely by that series and no other.
Each Fund seeks to achieve its investment objective by investing all of
its net investable assets in its corresponding Portfolio of Income Managers
Trust (the "Portfolio") having the same investment objective and policies as
the Fund. The value of each Fund's investment in its corresponding Portfolio
reflects that Fund's proportionate interest in the net assets of that
Portfolio (100% for each Fund at April 30, 1996). The performance of each
Fund is directly affected by the performance of its corresponding Portfolio.
The financial statements of each Portfolio, including the schedule of
investments, are included elsewhere in this report and should be read in
conjunction with each Fund's financial statements.
It is the policy of Municipal Money to maintain a continuous net asset
value per share of $1.00; the Fund has adopted certain investment, valuation,
and dividend and distribution policies, which conform to general industry
practice, to enable it to do so. However, there is no assurance the Fund will
be able to maintain a stable net asset value per share.
2) PORTFOLIO VALUATION: Each Fund records its investment in its corresponding
Portfolio at value. Investment securities held by each Portfolio of Income
Managers Trust are valued by Income Managers Trust as indicated in the notes
following the Portfolios' schedule of investments.
3) FEDERAL INCOME TAXES: Each series of the Trust is treated as a separate
entity for Federal income tax purposes. It is the policy of each Fund of the
Trust to continue to qualify as a regulated investment company by complying
with the provisions available to certain investment companies, as defined in
applicable sections of the
16
<PAGE>
Internal Revenue Code, and to make distributions of taxable income (after
reduction for any amounts available for Federal income tax purposes as
capital loss carryforwards) sufficient to relieve it from all, or
substantially all, Federal income taxes. Accordingly, each Fund paid no
Federal income taxes and no provision for Federal income taxes was required.
4) DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS: Each Fund earns income, net
of Portfolio expenses, daily on its investment in its corresponding
Portfolio. It is the policy of each Fund to declare dividends from net
investment income on each business day; such dividends are paid monthly.
Distributions from net realized capital gains, if any, are normally
distributed in December. To the extent each Fund's net realized capital
gains, if any, can be offset by capital loss carryforwards ($75,365 and
$25,578 expiring in 1997 and 2003, respectively, for Municipal Money,
$433,301 and $676,750 expiring in 2002 and 2003, respectively, for Municipal
Securities Trust, and $240,090 and $94,248 expiring in 2002 and 2003,
respectively, for New York Insured Intermediate, determined as of October 31,
1995), it is the policy of each Fund not to distribute such gains.
Each Fund distinguishes between dividends on a tax basis and a financial
reporting basis and only distributions in excess of tax basis earnings and
profits are reported in the financial statements as a return of capital.
Differences in the recognition or classification of income between the
financial statements and tax earnings and profits which result in temporary
over-distributions for financial statement purposes are classified as
distributions in excess of net investment income or accumulated net realized
gains.
5) ORGANIZATION EXPENSES: Expenses incurred by New York Insured
Intermediate in connection with its organization are being amortized on a
straight-line basis over a five-year period. At April 30, 1996, the
unamortized balance of such expenses amounted to $21,918.
6) EXPENSE ALLOCATION: The Funds bear all costs of operations. Expenses incurred
by the Trust with respect to any two or more Funds are allocated in
proportion to the net assets of such Funds, except where a more appropriate
allocation of expenses to each Fund can otherwise be made fairly. Expenses
directly attributable to a Fund are charged to that Fund.
7) OTHER: All net investment income and realized and unrealized capital gains
and losses of each Portfolio are allocated pro rata among its respective
Funds and any other investors in the Portfolio.
17
<PAGE>
NOTE B -- ADMINISTRATION FEES, DISTRIBUTION ARRANGEMENTS, AND OTHER TRANSACTIONS
WITH AFFILIATES:
Each Fund retains Neuberger&Berman Management Incorporated ("Management") as
its administrator under an Administration Agreement ("Agreement") dated as of
May 1, 1995. Pursuant to this Agreement each Fund pays Management an
administration fee at the annual rate of .27% (.25% prior to May 1, 1995) of
that Fund's average daily net assets and indirectly pays for investment
management services through its investment in its corresponding Portfolio. (See
Note B of Notes to Financial Statements of the Portfolios.) The Agreement
provides if, with respect to any fiscal year of each Fund, its total operating
expenses plus its pro rata portion of its corresponding Portfolio's operating
expenses (including the fees payable to Management but excluding interest,
taxes, brokerage commissions, and extraordinary expenses) ("Operating Expenses")
exceed the most restrictive of the expense limitations imposed by securities
laws of the states in which such Fund's shares are qualified for sale, the
administration fees for that fiscal year will be reduced by the amount of such
excess, provided that Management has no obligation to reimburse the Fund for any
such expenses that exceed the administration fee. The most restrictive expense
limitation to which Municipal Money and Municipal Securities Trust are currently
subject is 2 1/2% of the first $30 million of average daily net assets, 2% of
the next $70 million of average daily net assets, and 1 1/2% of any additional
average daily net assets. No reduction in the administration fee as a result of
any state expense limitation was required for the six months ended April 30,
1996.
In addition, Management has voluntarily undertaken to reimburse Municipal
Securities Trust and New York Insured Intermediate for their Operating Expenses
which exceed, in the aggregate, .65% per annum of their average daily net assets
(the "Expense Limitation"). This undertaking is subject to termination by
Management upon at least 60 days' prior written notice to the appropriate Fund.
For the six months ended April 30, 1996, such excess expenses amounted to
$85,055 and $70,124 for Municipal Securities Trust and New York Insured
Intermediate, respectively. New York Insured Intermediate has agreed to repay
Management through October 31, 1998, for its excess Operating Expenses
previously reimbursed by Management, so long as its annual Operating Expenses
during that period do not exceed the Expense Limitation.
All of the capital stock of Management is owned by individuals who are also
general partners of Neuberger&Berman, L.P. ("Neuberger"), a member firm of The
New York Stock Exchange and the sub-adviser to each Portfolio. Several
individuals who are officers and/or trustees of the Trust are also partners of
Neuberger and/or officers and/or directors of Management.
Under a service agreement, which was in effect through April 30, 1995, each
Fund had retained Management to provide certain shareholder, shareholder-related
and other services not furnished by the shareholder servicing agent. Pursuant to
the
18
<PAGE>
service agreement each Fund paid Management a monthly fee at the annual rate of
.02% of the average daily net assets of the Fund as compensation for such
services. As of May 1, 1995, the service agreement and the administration
agreement were combined into a single agreement with a fee of .27%.
Each Fund also has a distribution agreement with Management, which receives
no compensation therefor and no commissions for sales or redemptions of shares
of beneficial interest of each Fund.
NOTE C -- INVESTMENT TRANSACTIONS:
During the six months ended April 30, 1996, additions and reductions in each
Fund's investment in its corresponding Portfolio were as follows:
<TABLE>
<CAPTION>
ADDITIONS REDUCTIONS
------------ ------------
<S> <C> <C>
MUNICIPAL MONEY $124,238,103 $133,067,941
MUNICIPAL SECURITIES TRUST 1,855,785 5,779,705
NEW YORK INSURED INTERMEDIATE 1,013,119 2,980,553
</TABLE>
NOTE D -- UNAUDITED FINANCIAL INFORMATION:
The financial information included in this interim report is taken from the
records of each Fund without audit by independent auditors. Annual reports
contain audited financial statements.
19
<PAGE>
FINANCIAL HIGHLIGHTS
Neuberger&Berman
- --------------------------------------------------------------------------------
Municipal Money Fund
The following table includes selected data for a share outstanding throughout
each period and other performance information derived from the Financial
Statements. It should be read in conjunction with its corresponding Portfolio's
Financial Statements and notes thereto.
<TABLE>
<CAPTION>
Six Months
Ended
April 30,
1996 Year Ended October 31,
(UNAUDITED)(1) 1995(1) 1994(1) 1993(1) 1992 1991
------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of
Period $ .9994 $ .9995 $ .9996 $ .9995 $ .9989 $ .9989
------------------------------------------------------------------
Income From Investment Operations
Net Investment Income .0146 .0324 .0204 .0184 .0263 .0432
Net Gains or Losses on
Securities -- (.0001) (.0001) .0001 .0006 --
------------------------------------------------------------------
Total From Investment
Operations .0146 .0323 .0203 .0185 .0269 .0432
------------------------------------------------------------------
Less Distributions
Dividends (from net investment
income) (.0146) (.0324) (.0204) (.0184) (.0263) (.0432)
------------------------------------------------------------------
Net Asset Value, End of Period $ .9994 $ .9994 $ .9995 $ .9996 $ .9995 $ .9989
------------------------------------------------------------------
Total Return+ +1.47%(2) +3.29% +2.06% +1.86% +2.66% +4.40%
------------------------------------------------------------------
Ratios/Supplemental Data
Net Assets, End of Period (in
millions) $ 154.9 $ 160.9 $ 150.3 $ 181.6 $ 195.6 $ 173.9
------------------------------------------------------------------
Ratio of Expenses to Average
Net Assets .72%(3) .71% .73% .74% .67% .66%
------------------------------------------------------------------
Ratio of Net Investment Income
to Average Net Assets 2.93%(3) 3.24% 2.02% 1.85% 2.63% 4.34%
------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL HIGHLIGHTS
20
<PAGE>
FINANCIAL HIGHLIGHTS
Neuberger&Berman
- --------------------------------------------------------------------------------
Municipal Securities Trust
The following table includes selected data for a share outstanding throughout
each period and other performance information derived from the Financial
Statements. It should be read in conjunction with its corresponding Portfolio's
Financial Statements and notes thereto.
<TABLE>
<CAPTION>
Six Months
Ended
April 30,
1996 Year Ended October 31,
(UNAUDITED)(1) 1995(1) 1994(1) 1993(1) 1992 1991
------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 10.83 $ 10.26 $ 11.12 $ 10.53 $ 10.39 $ 10.14
------------------------------------------------------------------
Income From Investment Operations
Net Investment Income .23 .47 .46 .48 .54 .58
Net Gains or Losses on Securities
(both realized and unrealized) (.13) .57 (.73) .68 .14 .25
------------------------------------------------------------------
Total From Investment Operations .10 1.04 (.27) 1.16 .68 .83
------------------------------------------------------------------
Less Distributions
Dividends (from net investment
income) (.23) (.47) (.46) (.48) (.54) (.58)
Distributions (from capital gains) -- -- (.12) (.09) -- --
Distributions (in excess of capital
gains) -- -- (.01) -- -- --
------------------------------------------------------------------
Total Distributions (.23) (.47) (.59) (.57) (.54) (.58)
------------------------------------------------------------------
Net Asset Value, End of Period $ 10.70 $ 10.83 $ 10.26 $ 11.12 $ 10.53 $ 10.39
------------------------------------------------------------------
Total Return+ +0.94%(2) +10.35% -2.57% +11.30% +6.72% +8.41%
------------------------------------------------------------------
Ratios/Supplemental Data
Net Assets, End of Period (in
millions) $ 40.8 $ 44.3 $ 51.1 $ 105.2 $ 37.0 $ 25.5
------------------------------------------------------------------
Ratio of Expenses to Average Net
Assets(4) .65%(3) .65% .65% .62% .50% .50%
------------------------------------------------------------------
Ratio of Net Investment Income to
Average Net Assets(4) 4.30%(3) 4.45% 4.24% 4.33% 5.16% 5.61%
------------------------------------------------------------------
Portfolio Turnover Rate(5) -- -- -- 35% 46% 10%
------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL HIGHLIGHTS
21
<PAGE>
FINANCIAL HIGHLIGHTS
Neuberger&Berman
- --------------------------------------------------------------------------------
New York Insured Intermediate Fund
The following table includes selected data for a share outstanding throughout
each period and other performance information derived from the Financial
Statements. The per share amounts and ratios which are shown reflect income and
expenses, including the Fund's proportionate share of its corresponding
Portfolio's income and expenses. It should be read in conjunction with its
corresponding Portfolio's Financial Statements and notes thereto.
<TABLE>
<CAPTION>
Period from
Six Months Year February 1,
Ended Ended 1994(6)
April 30, October to October
1996 31, 31,
(UNAUDITED) 1995 1994
------------------------------------
<S> <C> <C> <C>
Net Asset Value, Beginning of Period $ 10.01 $ 9.25 $ 10.00
------------------------------------
Income From Investment Operations
Net Investment Income .20 .41 .29
Net Gains or Losses on Securities
(both realized and unrealized) (.16) .76 (.75)
------------------------------------
Total From Investment Operations .04 1.17 (.46)
------------------------------------
Less Distributions
Dividends (from net investment
income) (.20) (.41) (.29)
------------------------------------
Net Asset Value, End of Period $ 9.85 $ 10.01 $ 9.25
------------------------------------
Total Return+ +0.39%(2) +12.88% -4.63%(2)
------------------------------------
Ratios/Supplemental Data
Net Assets, End of Period (in
millions) $ 9.6 $ 11.5 $ 14.7
------------------------------------
Ratio of Expenses to Average Net
Assets(4) .66%(3) .66% .65%(3)
------------------------------------
Ratio of Net Investment Income to
Average Net Assets(4) 4.01%(3) 4.24% 4.10%(3)
------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL HIGHLIGHTS
22
<PAGE>
NOTES TO FINANCIAL HIGHLIGHTS
Neuberger&Berman April 30, 1996 (Unaudited)
- ----------------------------------------------------------------------
Income Funds
1)The per share amounts and ratios which are shown reflect income and expenses,
including each Fund's proportionate share of its corresponding Portfolio's
income and expenses.
2)Not annualized.
3)Annualized.
4)After reimbursement of expenses by the administrator as described in Note B of
Notes to Financial Statements. Had the administrator not undertaken such
action the annualized ratios to average daily net assets would have been:
<TABLE>
<CAPTION>
MUNICIPAL SECURITIES TRUST
SIX MONTHS ENDED YEAR ENDED OCTOBER 31,
APRIL 30, 1996 1995 1994 1993 1992 1991
- ------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Expenses 1.05% .98% .82% 1.04% 1.16% 1.38%
Net Investment Income 3.90% 4.12% 4.07% 3.91% 4.50% 4.73%
</TABLE>
<TABLE>
<CAPTION>
NEW YORK INSURED INTERMEDIATE
PERIOD FROM
SIX MONTHS ENDED YEAR ENDED OCTOBER FEBRUARY 1, 1994 TO
APRIL 30, 1996 31, 1995 OCTOBER 31, 1994
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Expenses 1.96% 1.83% 1.53%
Net Investment Income 2.71% 3.07% 3.22%
</TABLE>
5)The Fund transferred all of its investment securities into Neuberger&Berman
Municipal Securities Portfolio on July 2, 1993. After that date the Fund
invested only in Neuberger&Berman Municipal Securities Portfolio and that
Portfolio, rather than the Fund, engaged in securities transactions.
Therefore, after that date the Fund had no portfolio turnover rate. Portfolio
turnover rates for periods ending after July 2, 1993 are included elsewhere in
Neuberger&Berman Municipal Securities Portfolio's Financial Highlights.
6)The date investment operations commenced.
+ Total return based on per share net asset value reflects the effects of
changes in net asset value on the performance of each Fund during each period
and assumes dividends and capital gain distributions, if any, were
reinvested. Results represent past performance and do not guarantee future
results. Investment returns and principal may fluctuate and shares when
redeemed may be worth more or less than original cost. For Municipal
Securities Trust and New York Insured Intermediate, total return would have
been lower if Management had not reimbursed certain expenses.
23
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman
- --------------------------------------------------------------------------------
Municipal Money Portfolio
<TABLE>
<CAPTION>
PRINCIPAL VALUE(2)
AMOUNT RATING (000'S
(000'S OMITTED) SECURITY(1) MOODY'S S&P OMITTED)
- --------------- ------------------------------ ----------- --------- -------------
<C> <S> <C> <C> <C>
TAX-EXEMPT
SECURITIES -- PRE-REFUNDED
BACKED BY U.S. GOVERNMENT
SECURITIES (4.4%)
$ 1,000 Anchorage (AK) Tel. Rev., Ser.
1986 A, 7.625%, due 8/1/01 P/R
8/1/96 Aaa AAA $ 1,030
1,000 Commonwealth of Massachusetts
Ref. G.O., Ser. 1986 A,
7.125%, due 10/1/05 P/R
10/1/96 Aaa 1,033
1,150 Minnesota Ref. G.O., 7.00%,
due 8/1/99 P/R 8/1/96 Aaa 1,159
1,000 Seattle (WA) Muni. Lt. & Pwr.
Ref. Rev., Ser. 1986, 7.00%,
due 10/1/01 P/R 10/1/96 Aaa AAA 1,033
1,000 Virginia Pub. Sch. Au. Spec.
Oblig. Rev. (Henrico Co.),
6.90%, due 12/1/99 P/R 12/1/96 Aaa AAA 1,025
1,500 Washington Ref. G.O., Ser.
1986 D, 8.00%, due 9/1/06 P/R
9/1/96 Aaa AAA 1,521
-------------
6,801
-------------
MUNICIPAL NOTES (8.7%)
1,500 Dane Co. (WI) G.O. Notes, Ser.
1995 A, 5.75%, due 5/1/96 Aaa 1,500
1,010 Commonwealth of Massachusetts
G.O. Notes, Ser. 1995 A,
4.25%, due 6/12/96 MIG-1 SP-1 1,011
2,000 Michigan Muni. Bond Au. Rev.
Notes, Ser. 1995 A & B, 4.50%
& 5.00%, due 5/3/96 & 7/3/96 SP-1+ 2,001
2,000 Indianapolis (IN) Local Pub.
Imp. Notes, Ser. 1995 E,
4.50%, due 7/11/96 SP-1+ 2,003
1,000 Maricopa Co. (AZ) Sch. Dist.
#83 TANS (Cartwright
Elementary), Ser. A, 4.45%,
due 7/31/96 SP-1+ 1,002
2,000 Maricopa Co. (AZ) TANS, Ser.
1995, 4.50%, due 7/31/96 MIG-1 SP-1 2,005
1,000 Texas TRANS, Ser. A, 4.75%,
due 8/30/96 MIG-1 SP-1+ 1,002
</TABLE>
24
<PAGE>
April 30, 1996 (Unaudited)
- --------------------------------------------------------------------------------
Municipal Money Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL VALUE(2)
AMOUNT RATING (000'S
(000'S OMITTED) SECURITY(1) MOODY'S S&P OMITTED)
- --------------- ------------------------------ ----------- --------- -------------
<C> <S> <C> <C> <C>
$ 2,000 Michigan G.O. Notes, 4.00%,
due 9/30/96 MIG-1 SP-1+ $ 2,008
1,000 University of Cincinnati (OH)
Gen. Receipts BANS, Ser. K1,
3.75%, due 3/20/97 MIG-1 SP-1+ 1,004
-------------
13,536
-------------
TAX-EXEMPT
SECURITIES -- BACKED BY
INSURANCE (2.4%)
AMERICAN MUNICIPAL BOND ASSURANCE CORP.
1,760 Ohio Bldg. Au. St. Fac. Rev.
(Trans. Bldg. Fund), Ser. A,
5.00%, due 9/1/96 Aaa AAA 1,769
FINANCIAL GUARANTY INSURANCE CO.
2,000 Connecticut Spec. Assessment
Unemployment Comp. Adv. Fund
Rev., Ser. 1993 C, 3.90%, due
11/15/01 Putable 7/1/96 VMIG-1 A-1+ 2,000
-------------
3,769
-------------
TAX-EXEMPT
SECURITIES -- BACKED BY
LETTERS OF CREDIT (1.0%)
MORGAN GUARANTY TRUST CO.
1,600 Chicago (IL) G.O. Notes, Ser.
1995 A, 3.75%, due 10/31/96
Putable 5/1/96 MIG-1 SP-1+ 1,600
-------------
TAX-EXEMPT SECURITIES -- OTHER
(5.5%)
1,500 Greater Chicago (IL) Metro.
Wtr. Reclamation Dist. Ref.
G.O., Ser. 1992, 4.50%, due
12/1/96 Aa AA 1,508
1,000 Maryland CDA Dept. of Hsg. &
Comm. Dev. Rev. (Single Family
Prog.), 2nd Ser., 3.55%, due
4/1/26 Putable 10/1/96 VMIG-1 1,000
2,000 Montgomery Co. (MD) Hsg.
Opportunities Comm.
Multifamily Hsg. Rev., Ser.
1995 B, 3.90%, due 11/14/96 MIG-1 2,000
3,000 Phoenix (AZ) Var. Purp. G.O.,
Ser. 1991, 9.00%, due 7/1/96 Aa1 AA+ 3,026
1,000 San Antonio (TX) Gen. Imp.
Ref. G.O., Ser. 1992, 4.20%,
due 8/1/96 Aa AA 1,002
-------------
8,536
-------------
</TABLE>
25
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman
- --------------------------------------------------------------------------------
Municipal Money Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL VALUE(2)
AMOUNT RATING (000'S
(000'S OMITTED) SECURITY(1) MOODY'S S&P OMITTED)
- --------------- ------------------------------ ----------- --------- -------------
<C> <S> <C> <C> <C>
TAX-EXEMPT CASH EQUIVALENT
SECURITIES (2.9%)
$ 1,500 Carlton (WI) PCR (Wisconsin
Pwr. & Lt. Co. Proj.), Ser.
1988, 4.25%, VRDN due 8/1/15 P-1 A-1+ $ 1,500
800 Minneapolis (MN) Comm. Dev.
Agcy. Ref. PCR (No. States
Pwr. Co. Proj.), Ser. 1985,
4.20%, VRDN due 3/1/11 P-1 A-1+ 800
2,100 Oak Creek (WI) PCR (Wisconsin
Elec. Pwr. Co. Proj.), Ser.
1986, 4.25%, VRDN due 8/1/16 P-1 A-1+ 2,100
-------------
4,400
-------------
TAX-EXEMPT CASH EQUIVALENT
SECURITIES -- BACKED BY
LETTERS OF CREDIT (68.0%)
ABN AMRO BANK N.V.
3,600 Phenix City (AL) IDB Env. Imp.
Rev. (Mead Coated Board
Proj.), 3.25% & 3.30%, TECP
due 5/8/96 & 5/30/96 P-1 3,600
900 Prince George's Co. (MD) Ref.
Rev. (Frank Parsons Paper Co.,
Inc. Fac.), Ser. 1987, 3.45%,
VRDN due 1/1/13 P-1 A-1+ 900
BANK OF AMERICA
500 California Hlth. Fac. Au.
Hosp. Rev. (N.T. Enloe Mem.
Hosp.), Ser. 1985 A, 3.35%,
VRDN due 1/1/16 A-1+ 500
BANQUE INDOSUEZ-FRANCE
300 Brunswick & Glynn Co. (GA)
Dev. Au. Rev. (Jekyll Dev.
Assoc., L.P. Proj.), Ser.
1985, 4.30%, VRDN due 12/1/15 VMIG-1 A-2 300
BARCLAYS BANK INT'L., LTD.
6,200 Jasper Co. (IN) Ref. PCR (No.
Indiana Pub. Svc. Co. Proj.),
Ser. 1988 A & D, 3.15% &
3.35%, TECP due 8/9/96 &
8/12/96 VMIG-1 A-1+ 6,200
</TABLE>
26
<PAGE>
April 30, 1996 (Unaudited)
- --------------------------------------------------------------------------------
Municipal Money Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL VALUE(2)
AMOUNT RATING (000'S
(000'S OMITTED) SECURITY(1) MOODY'S S&P OMITTED)
- --------------- ------------------------------ ----------- --------- -------------
<C> <S> <C> <C> <C>
BAYERISCHE VEREINSBANK AG
$ 2,000 Phenix City (AL) IDB Env. Imp.
Rev. (Mead Coated Board
Proj.), 4.15%, VRDN due 3/1/31 VMIG-1 $ 2,000
CANADIAN IMPERIAL BANK OF COMMERCE
4,095 Memphis (TN) Arpt. Au. Rev.
(Shelby Co. Arpt.), 3.25% &
3.55%, TECP due
5/15/96-7/24/96 P-1 A-1+ 4,095
1,925 Rhode Island Port Au. & Econ.
Dev. Corp. Elec. Energy Fac.
Ref. Rev. (Newport Elec. Corp.
Proj.), Ser. 1994, 4.15%, VRDN
due 9/1/11 VMIG-1 A-1+ 1,925
1,000 St. Louis (MO) Ind. Dev. Au.
IDR (Svc. Merchandise Co.,
Inc. Proj.), 3.50%, VRDN due
9/15/98 A-1+ 1,000
CITIBANK, N.A.
1,100 Austin Co. (TX) Ind. Dev.
Corp. IDR (Justin Ind., Inc.
Proj.), Ser. 1984, 4.20%, VRDN
due 12/1/14 P-1 1,100
COMMERZBANK AG
4,800 Houston (TX) Arpt. Sys. Rev.,
Ser. A, 3.25%, TECP due
5/10/96-5/30/96 P-1 A-1+ 4,800
3,000 New York City (NY) G.O.,
3.50%, TECP due 8/15/96 VMIG-1 3,000
COMMONWEALTH BANK OF AUSTRALIA
3,300 Pendleton Co. (KY)
Multi-County Lease Rev.
(Kentucky Assoc. of Cos.
Leasing Trust Prog.), Ser.
1989, 3.55%, TECP due 6/13/96 A-1+ 3,300
CREDIT COMMERCIAL DE FRANCE
400 Elkhart Co. (IN) Econ. Dev.
Rev. (Pace Amer. Inc. Proj.),
4.55%, VRDN due 1/1/13 VMIG-1 400
250 Indiana Emp. Dev. Comm. Econ.
Dev. Rev. (Metal Svc. & Supply
Inc.), 4.55%, VRDN due 1/1/13 VMIG-1 250
</TABLE>
27
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman
- --------------------------------------------------------------------------------
Municipal Money Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL VALUE(2)
AMOUNT RATING (000'S
(000'S OMITTED) SECURITY(1) MOODY'S S&P OMITTED)
- --------------- ------------------------------ ----------- --------- -------------
<C> <S> <C> <C> <C>
$ 400 Indiana Emp. Dev. Comm. Econ.
Dev. Rev. (Mobel Proj.), Ser.
1988, 4.55%, VRDN due 1/1/14 VMIG-1 $ 400
150 Indiana Emp. Dev. Comm. Econ.
Dev. Rev. (Triangle Ventures
Proj.), 4.55%, VRDN due 1/1/14 VMIG-1 150
600 Mississippi Bus. Fin. Corp.
IDR (Air Cruisers Proj.), Ser.
1989 C, 4.40%, VRDN due
10/1/04 P-1 600
200 South Carolina Jobs Econ. Dev.
Au. Rev. (Brown Packing Co.,
Inc.), Ser. 1988 B, 4.50%,
VRDN due 4/1/99 VMIG-1 200
200 South Carolina Jobs Econ. Dev.
Au. Rev. (Kent Mfg. Co.
Proj.), Ser. 1988 A, 4.40%,
VRDN due 4/7/99 VMIG-1 200
50 South Carolina Jobs Econ. Dev.
Au. Rev. (Mar-Mac Mfg. Co.,
Inc. Proj.), Ser. 1988 A,
4.50%, VRDN due 4/7/99 VMIG-1 50
300 South Carolina Jobs Econ. Dev.
Au. Rev. (Regal-Beloit Corp.
Proj.), Ser. 1987 A, 4.40%,
VRDN due 5/7/01 P-1 300
100 South Carolina Jobs Econ. Dev.
Au. Rev. (Sudan & Delta
Prop.), Ser. A, 4.50%, VRDN
due 1/1/04 VMIG-1 100
400 South Carolina Jobs Econ. Dev.
Au. Rev. (Phoenix Finishing
Co.), Ser. B, 4.50%, VRDN due
4/1/04 VMIG-1 400
650 South Carolina Jobs Econ. Dev.
Au. Rev. (Osmose Wood
Preserving), Ser. B, 4.40%,
VRDN due 12/1/04 P-1 650
350 South Carolina Jobs Econ. Dev.
Au. Rev. (Edens 321
Partnership Proj.), Ser. 1987
A, 4.50%, VRDN due 11/7/07 P-1 350
</TABLE>
28
<PAGE>
April 30, 1996 (Unaudited)
- --------------------------------------------------------------------------------
Municipal Money Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL VALUE(2)
AMOUNT RATING (000'S
(000'S OMITTED) SECURITY(1) MOODY'S S&P OMITTED)
- --------------- ------------------------------ ----------- --------- -------------
<C> <S> <C> <C> <C>
$ 600 South Carolina Jobs Econ. Dev.
Au. Rev. (Florence RHF Hsg.,
Inc. Proj.), Ser. 1987 A,
4.30%, VRDN due 11/7/07 P-1 $ 600
CREDIT LOCAL DE FRANCE
2,000 Louisiana Ref. G.O., Ser.
1991-A, 3.15%, TECP due
6/11/96 VMIG-1 A-1+ 2,000
2,000 South Carolina Jobs Econ. Dev.
Au. Hosp. Fac. Rev. (Baptist
Healthcare Sys.), 4.10%, VRDN
due 8/1/17 VMIG-1 A-1+ 2,000
CREDIT SUISSE
1,200 Hubbard Co. (MN) Solid Waste
Disp. Rev. (Potlatch Corp.
Proj.), Ser. 1990, 4.20%, VRDN
due 8/1/14 A-1+ 1,200
500 Montgomery Co. (TX) Ind. Dev.
Corp. IDR (Dallas Tile Corp.),
Ser. B, 4.30%, VRDN due
12/1/03 A-1+ 500
900 Salt Lake City (UT) Sub. Arpt.
Rev., Ser. 1994 A, 4.20%, VRDN
due 6/1/98 VMIG-1 A-1+ 900
1,000 Texas Capital Hlth. Fac. Dev.
Corp. (Island on Lake Travis
Ltd. Proj.), 4.20%, VRDN due
12/1/16 A-1+ 1,000
1,000 Wake Co. (NC) Ind. Fac. &
Poll. Ctrl. Fin. Au. PCR
(Carolina Pwr. & Lt. Co.
Proj.), Ser. 1985 A, 4.00%,
VRDN due 5/1/15 P-1 A-1+ 1,000
600 Warren (AR) Solid Waste Disp.
Rev. (Potlatch Corp. Proj.),
4.20%, VRDN due 4/1/12 A-1+ 600
DEUTSCHE BANK AG
4,800 Converse Co. (WY) Ref. PCR
(PacifiCorp Proj.), 3.30%,
TECP due 5/6/96 P-1 A-1+ 4,800
2,600 New Hampshire Ind. Dev. Au.
PCR (Connecticut Lt. & Pwr.
Co. Proj.), Ser. 1986, 4.25%,
VRDN due 11/1/16 VMIG-1 2,600
</TABLE>
29
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman
- --------------------------------------------------------------------------------
Municipal Money Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL VALUE(2)
AMOUNT RATING (000'S
(000'S OMITTED) SECURITY(1) MOODY'S S&P OMITTED)
- --------------- ------------------------------ ----------- --------- -------------
<C> <S> <C> <C> <C>
HARRIS TRUST & SAVINGS
$ 900 Illinois Dev. Fin. Au. IDR
(Grayhill Inc. Proj.), Ser. C,
4.40%, VRDN due 2/1/05 A-1+ $ 900
1,000 Illinois Dev. Fin. Au. IDR
(Overton Gear & Tool Corp.),
4.40%, VRDN due 10/1/08 A-1+ 1,000
MORGAN GUARANTY TRUST CO.
3,000 North Carolina Muni. Pwr.
Agcy. #1 Rev. (Catawba Elec.
Proj.), 3.15%, TECP due 8/9/96 P-1 A-1+ 3,000
950 Port of Kalama (WA) Pub. Corp.
Port Fac. Rev. (ConAgra, Inc.
Proj.), 4.00%, VRDN due 1/1/04 A-1+ 950
1,575 Sunshine St. (FL) Gov't. Fin.
Comm. Rev., Ser. 1986, 3.25%,
TECP due 8/8/96 VMIG-1 1,575
NATIONAL WESTMINSTER BANK
2,000 Carbon Co. (PA) IDA Res. Rec.
Rev. (Panther Creek Partners
Proj.), Ser. 1990 B, 3.35%,
TECP due 8/8/96 P-1 A-1+ 2,000
3,200 Marion Co. (WV) Comm. Solid
Waste Disp. Fac. Rev. (Grant
Town Cogeneration Proj.), Ser.
1990 A-D, 4.15% & 4.25%, VRDN
due 10/1/17 VMIG-1 A-1+ 3,200
1,000 Rhode Island Std. Loan Au.
Prog. Rev., 1st Ser. 1995,
4.25%, VRDN due 7/1/19 A-1+ 1,000
NORWEST BANK
800 New Ulm (MN) Hosp. Ref. Rev.
(Hlth. Central Sys. Proj.),
Ser. 1985, 3.75%, VRDN due
8/1/14 A-1+ 800
PNC BANK N.A.
400 Florida HFA Multi-Family Hsg.
Rev. (Falls of Venice Proj.),
Ser. 1987 E, 4.20%, VRDN due
12/1/11 P-1 A-1 400
RABOBANK NEDERLAND
1,000 West Orange (FL) Mem. Hosp.
Tax Dist. Rev., Ser. 1991 A-1,
3.55%, TECP due 5/7/96 VMIG-1 1,000
</TABLE>
30
<PAGE>
April 30, 1996 (Unaudited)
- --------------------------------------------------------------------------------
Municipal Money Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL VALUE(2)
AMOUNT RATING (000'S
(000'S OMITTED) SECURITY(1) MOODY'S S&P OMITTED)
- --------------- ------------------------------ ----------- --------- -------------
<C> <S> <C> <C> <C>
ROYAL BANK OF CANADA
$ 700 Lone Star (TX) Arpt. Imp. Au.,
Ser. B-3 & B-4, 4.05%, VRDN
due 12/1/14 VMIG-1 $ 700
SOCIETE GENERALE
900 Chicago (IL) O'Hare Int'l.
Arpt. Gen. Arpt. 2nd Lien
Rev., Ser. 1984 A, 4.00%, VRDN
due 1/1/15 VMIG-1 A-1+ 900
1,900 Chicago (IL) O'Hare Int'l.
Arpt. Spec. Fac. Rev.
(Compagnie Nationale Air
France Proj.), Ser. 1990,
4.25%, VRDN due 5/1/18 A-1+ 1,900
1,000 Harris Co. (TX) Hlth. Fac.
Dev. Corp. Hosp. Rev. (Mem.
Hosp. Sys. Proj.), Ser. 1994
B, 3.40%, TECP due 5/6/96 VMIG-1 1,000
1,000 Illinois Toll Hwy. Au. Ref.
Rev., Ser. 1993 B, 4.10%, VRDN
due 1/1/10 VMIG-1 A-1+ 1,000
100 Indianapolis (IN) Multi-Family
Hsg. Ref. Rev. (Canal Square
Proj.), Ser. 1989, 4.00%, VRDN
due 12/1/15 VMIG-1 100
1,700 Los Angeles (CA) Reg. Arpts.
Imp. Corp. Term. Fac. (Los
Angeles Int'l. Arpt.), 4.15%,
VRDN due 12/1/25 A-1+ 1,700
STUDENT LOAN MARKETING ASSOC.
200 Colorado Std. Oblig. Bond Au.
Std. Loan Rev., Ser. 1993 A,
4.10%, VRDN due 7/1/99 VMIG-1 A-1+ 200
300 Nebraska Higher Ed. Loan
Prog., Inc. Multiple-Mode Std.
Loan Prog. Rev., Ser. 1985 A,
4.30%, VRDN due 12/1/16 A-1+ 300
1,600 Panhandle-Plains (TX) Higher
Ed. Au., Inc. Std. Loan Rev.,
Ser. 1995 A, 4.20%, VRDN due
6/1/25 VMIG-1 1,600
2,000 Pennsylvania Higher Ed.
Assist. Agcy. Std. Loan Rev.,
Ser. 1988 B, 4.15%, VRDN due
7/1/18 VMIG-1 A-1+ 2,000
</TABLE>
31
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman
- --------------------------------------------------------------------------------
Municipal Money Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL VALUE(2)
AMOUNT RATING (000'S
(000'S OMITTED) SECURITY(1) MOODY'S S&P OMITTED)
- --------------- ------------------------------ ----------- --------- -------------
<C> <S> <C> <C> <C>
SUN BANK
$ 2,000 Jacksonville (FL) G.O., 3.40%,
TECP due 5/30/96 P-1 A-1 $ 2,000
1,900 Orange Co. (FL) Hlth. Fac. Au.
Rev. (SHCC Svcs., Inc. Proj.),
Ser. 1992, 4.05%, VRDN due
12/1/23 VMIG-1 1,900
SWISS BANK CORP.
1,200 Pennsylvania Energy Dev. Au.
Rev. (B & W Ebensburg Proj.),
Ser. 1986, 4.20%, VRDN due
12/1/11 VMIG-1 1,200
3,800 Port of Port Arthur (TX)
Navigation Dist. of Jefferson
Co. PCR (Star Enterprise
Proj.), Ser. 1994, 4.20%, VRDN
due 4/1/14 A-1+ 3,800
TORONTO DOMINION BANK
1,000 Burlington (KS) Ref. & Imp.
PCR (Kansas City Pwr. & Lt.
Co. Proj.), Ser. 1985 A,
3.20%, TECP due 5/16/96 A-1+ 1,000
2,000 Clark Co. (NV) Arpt. Sys. Sub.
Lien Rev., Ser. 1995 A-1,
4.10%, VRDN due 7/1/25 VMIG-1 A-1+ 2,000
1,000 Crossett (AR) PCR
(Georgia-Pacific Corp. Proj.),
Ser. 1984, 4.20%, VRDN due
10/1/07 P-1 1,000
2,000 Ohio Air Quality Dev. Au. PCR
(Duquesne Lt. Co. Proj.), Ser.
1988, 3.60%, TECP due 8/2/96 Aa2 A-1+ 2,000
1,000 Ohio Wtr. Dev. Au. PCR
(Duquesne Lt. Co. Proj.), Ser.
1988, 3.60%, TECP due 8/2/96 Aa2 A-1+ 1,000
120 Wisconsin Hlth. Fac. Au. Rev.
(Franciscan Hlth. Care), Ser.
A-2, 4.10%, VRDN due 1/1/16 VMIG-1 A-1+ 120
</TABLE>
32
<PAGE>
April 30, 1996 (Unaudited)
- --------------------------------------------------------------------------------
Municipal Money Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL VALUE(2)
AMOUNT RATING (000'S
(000'S OMITTED) SECURITY(1) MOODY'S S&P OMITTED)
- --------------- ------------------------------ ----------- --------- -------------
<C> <S> <C> <C> <C>
TRUST CO. BANK-ATLANTA
$ 1,500 Fulco (GA) Hosp. Au. Rev.
Anticipation Cert. (St.
Joseph's Hosp. of Atlanta
Proj.), Ser. 1989, 3.20%, TECP
due 5/8/96 VMIG-1 $ 1,500
UNION BANK OF SWITZERLAND
1,705 Des Moines (IA) Commercial
Dev. Rev. (Capitol Ctr. III
Proj.), 4.10%, VRDN due
12/1/15 VMIG-1 1,705
150 Indiana Emp. Dev. Comm. Econ.
Dev. Rev. (K & F Ind., Inc.),
4.55%, VRDN due 1/1/14 VMIG-1 150
400 New Hampshire Ind. Dev. Au.
PCR (Connecticut Lt. & Pwr.
Co. Proj.), Ser. 1988, 4.20%,
VRDN due 8/1/18 A-1+ 400
400 Sullivan Co. (TN) IDB Ref. PCR
(Mead Corp. Proj.), 4.05%,
VRDN due 10/1/16 A-1+ 400
1,700 Sunshine St. (FL) Gov't. Fin.
Comm. Rev., Ser. 1986, 3.45%,
TECP due 8/29/96 VMIG-1 A-1+ 1,700
WACHOVIA BANK & TRUST CO.
800 Los Angeles (CA) Reg. Arpts.
Imp. Corp. Lease Rev. (Amer.
Airlines-Los Angeles Int'l.
Arpt.), Ser. E, 4.05%, VRDN
due 12/1/24 VMIG-1 800
WESTDEUTSCHE LANDESBANK GIROZENTRALE
1,600 Massachusetts Bay Trans. Au.,
3.50%, TECP due 5/16/96 P-1 SP-1+ 1,600
-------------
105,470
-------------
</TABLE>
33
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman April 30, 1996 (Unaudited)
- --------------------------------------------------------------------------------
Municipal Money Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL VALUE(2)
AMOUNT RATING (000'S
(000'S OMITTED) SECURITY(1) MOODY'S S&P OMITTED)
- --------------- ------------------------------ ----------- --------- -------------
<C> <S> <C> <C> <C>
TAX-EXEMPT CASH EQUIVALENT
SECURITIES -- BACKED BY
INSURANCE (0.4%)
AMERICAN MUNICIPAL BOND ASSURANCE CORP.
$ 400 Sayre (PA) Hlth. Care Fac. Au.
Hosp. Rev. (VHA of PA, Inc.
Cap. Asset Fin. Prog.), Ser.
1985 A, 4.00%, VRDN due
12/1/20 Aaa A-1 $ 400
MUNICIPAL BOND INVESTORS ASSURANCE CORP.
188 Clermont Co. (OH) Hosp. Fac.
Rev. (Mercy Hlth. Care Sys.,
Province of Cincinnati), Ser.
1985 B, 4.05%, VRDN due
12/1/15 VMIG-1 A-1+ 188
-------------
588
-------------
TOTAL INVESTMENTS (93.3%) 144,700
Cash, receivables and other
assets, less liabilities
(6.7%) 10,351
-------------
TOTAL NET ASSETS (100.0%) $ 155,051
-------------
</TABLE>
34
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman April 30, 1996 (Unaudited)
- --------------------------------------------------------------------------------
Municipal Securities Portfolio
<TABLE>
<CAPTION>
PRINCIPAL VALUE(2)
AMOUNT RATING (000'S
(000'S OMITTED) SECURITY(1) MOODY'S S&P OMITTED)
- --------------- ------------------------------ ----------- --------- -------------
<C> <S> <C> <C> <C>
TAX-EXEMPT
SECURITIES -- PRE-REFUNDED
BACKED BY U.S. GOVERNMENT
SECURITIES (5.4%)
$ 1,000 Harris Co. (TX) Toll Road
Unlimited Tax & Sub. Lien Ref.
Rev., Ser. 1992 A, 6.50%, due
8/15/17 P/R 8/15/02 Aaa AAA $ 1,107
1,000 Massachusetts Wtr. Res. Au.
Gen. Rev., Ser. 1992 A, 6.50%,
due 7/15/21 P/R 7/15/02 Aaa AAA 1,106
-------------
2,213
-------------
TAX-EXEMPT
SECURITIES -- BACKED BY
INSURANCE (25.0%)
AMERICAN MUNICIPAL BOND ASSURANCE CORP.
1,000 Florida Dept. of Env.
Protection Preservation 2000
Rev., Ser. 1995 A, 5.50%, due
7/1/07 Aaa AAA 1,020
1,000 Harris Co. (TX) Toll Road Sr.
Lien Ref. Rev., Ser. 1994,
4.30%, due 8/15/00 Aaa AAA 990
1,000 New York City (NY) Muni.
Assist. Corp. Rev., Ser. D,
5.25%, due 7/1/02 Aaa AAA 1,027
750 West Geauga (OH) Local Sch.
Dist. Unlimited Tax Sch. Imp.
G.O., Ser. 1994, 5.25%, due
11/1/02 Aaa AAA 772
FINANCIAL GUARANTY INSURANCE CO.
1,000 Dade Co. (FL) Wtr. & Swr. Sys.
Rev., Ser. 1995, 6.25%, due
10/1/06 Aaa AAA 1,097
325 Metropolitan (DC) Arpts. Au.
Sys. Rev., Ser. 1990 A, 6.90%,
due 10/1/99 Aaa AAA 347
750 New York Dorm. Au. Rev. (State
Univ. Ed. Fac.), Ser. 1993 B,
5.20%, due 5/15/03 Aaa AAA 766
MUNICIPAL BOND INVESTORS ASSURANCE CORP.
1,000 Commonwealth of Pennsylvania
G.O. (Ref. & Proj.), 2nd Ser.
1994, 5.20%, due 6/15/04 Aaa AAA 1,016
1,000 Connecticut Spec. Tax Oblig.
Ref. Rev. (Trans.
Infrastructure Purp.), Ser.
1993 A, 5.40%, due 9/1/09 Aaa AAA 994
</TABLE>
35
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman
- --------------------------------------------------------------------------------
Municipal Securities Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL VALUE(2)
AMOUNT RATING (000'S
(000'S OMITTED) SECURITY(1) MOODY'S S&P OMITTED)
- --------------- ------------------------------ ----------- --------- -------------
<C> <S> <C> <C> <C>
$ 1,000 Nebraska Inv. Fin. Au. Hosp.
Rev. (Nebraska Methodist Hlth.
Sys., Inc.), Ser. 1991, 7.00%,
due 3/1/06 Aaa AAA $ 1,093
1,000 Puerto Rico Elec. Pwr. Au.
Ref. Rev., Ser. W, 6.50%, due
7/1/05 Aaa AAA 1,114
-------------
10,236
-------------
TAX-EXEMPT SECURITIES -- OTHER
(67.0%)
1,000 Baltimore Co. (MD) Metro.
Dist. G.O., 64th Issue, 4.25%,
due 8/1/02 Aaa AAA 974
1,060 Brownwood (TX) Independent
Sch. Dist. Unlimited Tax Sch.
Bldg. & Ref. G.O. (Brown Co.,
Texas), Ser. 1994, Zero
Coupon, Yielding 5.90% &
6.10%, due 2/15/02 & 2/15/04 Aaa 738
1,000 California Ed. Fac. Au. Rev.
(Univ. of So. Cal. Proj.),
Ser. 1989 B, 6.80%, due
10/1/99 Aa AA 1,078
750 Cincinnati (OH) Std. Loan
Funding Corp. Std. Loan Ref.
Rev., Ser. 1992 C, 6.10%, due
7/1/02 Aaa 776
1,000 Commonwealth of Massachusetts
Ref. G.O., Ser. 1995 A, 6.25%,
due 7/1/04 A1 A+ 1,082
500 Commonwealth of Virginia
Trans. Rev. (No. Virginia
Trans. Dist. Prog.), Ser. 1993
C, 4.60%, due 5/15/01 Aa AA 499
2,000 Georgia G.O., Ser. 1994 D &
1995 C, 6.80% & 7.25%, due
8/1/00 & 7/1/04 Aaa AA+ 2,248
1,970 Honolulu (HI) City & Co. G.O.,
Ser. 74, Zero Coupon, Yielding
5.95%, due 1/1/13 Aa 724
1,500 Maryland Comm. Dev. Admin.
Dept. Hsg. & Comm. Dev. Rev.
(Single Family Prog.), 3rd
Ser. 1993, 5.15%, due 4/1/08 Aa 1,474
500 Maryland Nat'l. Cap. Park &
Planning Comm. G.O. (Prince
George's Co.), Ser. J2, 6.90%,
due 7/1/99 Aa AA 538
</TABLE>
36
<PAGE>
April 30, 1996 (Unaudited)
- --------------------------------------------------------------------------------
Municipal Securities Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL VALUE(2)
AMOUNT RATING (000'S
(000'S OMITTED) SECURITY(1) MOODY'S S&P OMITTED)
- --------------- ------------------------------ ----------- --------- -------------
<C> <S> <C> <C> <C>
$ 1,400 Maryland St. & Local Fac. Loan
G.O., 2nd Ser. 1989 T & 3rd
Ser. 1990 W, 6.40% & 6.60%,
due 7/15/98 & 7/15/00 Aaa AAA $ 1,481
1,300 Maryland Wtr. Quality Fin.
Admin. Ref. Rev. (Revolving
Loan Fund), Ser. 1995 A,
5.50%, due 9/1/11 Aa AA 1,287
1,000 Mecklenburg Co. (NC) Pub. Imp.
G.O., Ser. 1994, 5.50%, due
4/1/12 Aaa AAA 998
1,000 Minnesota Ref. G.O., 5.20%,
due 8/1/00 Aa1 AA+ 1,030
215 Mississippi Higher Ed. Assist.
Corp. Std. Loan Rev., Ser.
1993 C, 6.05%, due 9/1/07 A 216
150 Missouri Env. Imp. & Energy
Res. Au. Wtr. PCR (St.
Revolving Fund Prog.-Multiple
Participant Series), Ser. 1994
A, 4.70%, due 7/1/98 Aa 151
370 Nevada Hsg. Div. Single-Family
Prog. Ref. Rev. (Fed. Ins. or
Gtd. Mtge. Loans), Ser. 1993
R, 5.20%, due 4/1/01 A1 AA 370
500 New Jersey Bldg. Au. St. Bldg.
Rev., Ser. 1994, 5.00%, due
6/15/11 Aa AA- 465
750 New York City (NY) IDA Spec.
Fac. Rev. (Term. One Group
Assoc., L.P. Proj.), Ser.
1994, 6.00%, due 1/1/15 A A 729
1,000 New York Dorm. Au. Rev.
(Columbia Univ.), Ser. 1994 A,
4.00%, due 7/1/00 Aaa AA+ 980
1,000 Omaha (NE) Pub. Pwr. Dist.
Elec. Sys. Rev., Ser. 1993 E,
4.60%, due 2/1/06 Aa AA 955
500 Omaha (NE) Var. Purp. G.O.,
Ser. 1990, 7.00%, due 5/1/99 Aaa AAA 538
500 Phoenix (AZ) Wtr. Sys. Ref.
Rev., Ser. 1993, 4.95%, due
7/1/03 A1 AA 502
1,000 Platte River (CO) Pwr. Au.
Rev., Ser. AA, 6.60%, due
6/1/02 Aa A+ 1,046
</TABLE>
37
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman
- --------------------------------------------------------------------------------
Municipal Securities Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL VALUE(2)
AMOUNT RATING (000'S
(000'S OMITTED) SECURITY(1) MOODY'S S&P OMITTED)
- --------------- ------------------------------ ----------- --------- -------------
<C> <S> <C> <C> <C>
$ 1,000 Port of Portland (OR) Ref.
G.O., Ser. 1993 A, 4.50%, due
3/1/05 Aa AA+ $ 946
1,000 Seattle (WA) Muni. Lt. & Pwr.
Ref. Rev., Ser. 1993, 4.90%,
due 11/1/03 Aa AA 999
2,000 South Carolina Cap. Imp.
Unlimited Tax G.O., Ser. 1995
A, 5.00%, due 3/1/02 Aaa AA+ 2,039
1,000 Utah Bldg. G.O., Ser. 1991 G,
5.50%, due 7/1/98 Aaa AAA 1,030
435 Utah Hsg. Fin. Agcy. Single
Family Mtge. Purchase Ref.
Rev., Ser. 1993 A, 5.40%, due
1/1/03 & 7/1/03 Aa 435
1,000 Washington Motor Vehicle Fuel
Tax G.O., Ser. 1995 D, 6.50%,
due 9/1/01 Aa AA 1,083
-------------
27,411
-------------
TAX-EXEMPT CASH EQUIVALENT
SECURITIES (0.2%)
100 Lincoln Co. (WY) PCR (Exxon
Proj.), 4.00%, VRDN due
11/1/14 P-1 A-1+ 100
-------------
TAX-EXEMPT CASH EQUIVALENT
SECURITIES -- BACKED BY
LETTERS OF CREDIT (1.0%)
ROYAL BANK OF CANADA
100 Lone Star (TX) Arpt. Imp. Au.
Rev., Ser. A-5, 4.05%, VRDN
due 12/1/14 VMIG-1 100
</TABLE>
38
<PAGE>
April 30, 1996 (Unaudited)
- --------------------------------------------------------------------------------
Municipal Securities Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL VALUE(2)
AMOUNT RATING (000'S
(000'S OMITTED) SECURITY(1) MOODY'S S&P OMITTED)
- --------------- ------------------------------ ----------- --------- -------------
<C> <S> <C> <C> <C>
UNION BANK OF SWITZERLAND
$ 100 Delta Co. (MI) Econ. Dev.
Corp. Env. Imp. Rev.
(Mead-Escanaba Paper Proj.),
Ser. 1992, 4.05%, VRDN due
12/1/23 A-1+ $ 100
200 Sullivan Co. (TN) IDB Ref. PCR
(Mead Corp. Proj.), 4.05%,
VRDN due 10/1/16 A-1+ 200
-------------
400
-------------
TOTAL INVESTMENTS (98.6%)
(COST $40,129) 40,360(3)
Cash, receivables and other
assets, less liabilities
(1.4%) 585
-------------
TOTAL NET ASSETS (100.0%) $ 40,945
-------------
</TABLE>
39
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman
- --------------------------------------------------------------------------------
New York Insured Intermediate Portfolio
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE(2)
(000'S OMITTED) SECURITY(1) MOODY'S S&P (000'S OMITTED)
- --------------- ------------------------------ ----------- --------- ---------------
<C> <S> <C> <C> <C>
TAX-EXEMPT
SECURITIES -- PRE-REFUNDED
BACKED BY U.S. GOVERNMENT
SECURITIES (4.3%)
$ 200 New York City (NY) Muni.
Assist. Corp., Ser. 57, 7.25%,
due 7/1/08 P/R 7/1/96 Aaa AAA $ 205
185 New York Local Gov't. Assist.
Corp., Ser. 1991 A, 7.00%, due
4/1/16 P/R 4/1/01 Aaa AAA 207
------
412
------
TAX-EXEMPT
SECURITIES -- BACKED BY
INSURANCE (73.3%)
AMERICAN MUNICIPAL BOND ASSURANCE CORP.
550 Canandaigua (NY) Sch. Dist.
Ref. G.O., 5.125% & 5.25%, due
6/1/06 & 6/1/07 Aaa AAA 552
275 William Floyd (NY) Union Free
Sch. Dist. (The
Mastics-Moriches-Shirley),
Ser. 1993, 4.80%, due 12/1/03 Aaa AAA 273
FINANCIAL GUARANTY INSURANCE CO.
455 Babylon (NY) Waste Fac. G.O.,
Ser. 1993, 4.40%, due 8/1/03 Aaa AAA 443
150 Buffalo (NY) Swr. Au. Swr.
Sys. Rev., Ser. G, 5.00%, due
7/1/03 Aaa AAA 151
200 Chautauqua Co. (NY) Var. Purp.
G.O., Ser. 1991, 6.40%, due
9/15/04 Aaa AAA 220
250 Nassau Co. (NY) Gen. Imp.
G.O., Ser. R, 5.125%, due
11/1/05 Aaa AAA 251
435 New York City (NY) G.O., Ser.
1990 I, 6.90%, due 8/15/98 Aaa AAA 460
300 New York City (NY) Muni.
Assist. Corp., Ser. 1991 A,
6.60%, due 7/1/01 Aaa AAA 326
100 North Hempstead (NY) Pub. Imp.
G.O., Ser. 1993 C, 4.90%, due
8/1/03 Aaa AAA 100
450 North Hempstead (NY) Ref.
G.O., Ser. 1992 B, 5.90%, due
4/1/04 Aaa AAA 482
</TABLE>
40
<PAGE>
April 30, 1996 (Unaudited)
- --------------------------------------------------------------------------------
New York Insured Intermediate Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE(2)
(000'S OMITTED) SECURITY(1) MOODY'S S&P (000'S OMITTED)
- --------------- ------------------------------ ----------- --------- ---------------
<C> <S> <C> <C> <C>
$ 470 Triborough Bridge & Tunnel Au.
(NY) Spec. Oblig. Rev., Ser.
1992, 5.80%, due 1/1/02 Aaa AAA $ 495
MUNICIPAL BOND INVESTORS ASSURANCE CORP.
400 Broome Co. (NY) Cert. of
Participation (Pub. Safety
Fac.), Ser. 1994, 4.50%, due
4/1/01 Aaa AAA 397
485 Buffalo (NY) Sch. G.O., Ser.
1994 B, 5.05%, due 2/1/04 &
2/1/05 Aaa AAA 486
390 Eldred (NY) Central Sch. Dist.
G.O., Ser. 1994, 4.50%, due
12/15/05 Aaa AAA 371
250 New York Cert. of
Participation (City Univ. of
NY, John Jay College of
Criminal Justice Ref. Proj.),
4.90%, due 8/15/07 Aaa AAA 240
300 New York Dorm. Au. Rev. (Leake
& Watts Svcs., Inc.), Ser.
1994, 5.10%, due 7/1/02 Aaa AAA 305
300 New York Thruway Au. (Local
Hwy. & Bridge Svc. Contract),
Ser. 1995 A, 5.125%, due
1/1/06 Aaa AAA 298
415 Oyster Bay (NY) Pub. Imp. Ref.
G.O., Ser. 1993, 5.40%, due
2/15/03 Aaa AAA 430
270 Puerto Rico Elec. Pwr. Au.
Pwr. Ref. Rev., Ser. W, 5.00%,
due 7/1/04 Aaa AAA 273
190 Syracuse (NY) G.O., Ser. A,
6.10%, due 6/15/99 Aaa AAA 200
300 Warren Co. (NY) Pub. Imp.
G.O., Ser. 1993 A, 4.40%, due
11/15/07 Aaa AAA 274
------
7,027
------
TAX-EXEMPT SECURITIES -- OTHER
(18.2%)
200 New York Dorm. Au. Rev.
(Vassar College), Ser. 1995,
4.875%, due 7/1/07 Aa AA 190
500 New York Thruway Au. (Local
Hwy. & Bridge Svc. Contract),
Ser. 1991, 7.00%, due 1/1/03 Baa1 BBB 535
</TABLE>
41
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman April 30, 1996 (Unaudited)
- --------------------------------------------------------------------------------
New York Insured Intermediate Portfolio (Cont'd)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE(2)
(000'S OMITTED) SECURITY(1) MOODY'S S&P (000'S OMITTED)
- --------------- ------------------------------ ----------- --------- ---------------
<C> <S> <C> <C> <C>
$ 500 New York Urban Dev. Corp.
Proj. Rev. (Columbia Univ.
Ctr. for Computers,
Microelectronics &
Telecommunications Grant),
Ser. 1994, 4.75% & 4.875%, due
1/1/02 & 1/1/03 Baa1 BBB $ 485
500 Puerto Rico Pub. Bldg. Au.
Ref. Rev., Ser. J, 6.50%, due
7/1/03 Baa1 A 540
------
1,750
------
TAX-EXEMPT CASH EQUIVALENT
SECURITIES -- BACKED BY
INSURANCE (2.1%)
AMERICAN MUNICIPAL BOND ASSURANCE CORP.
100 New York City (NY) G.O., Ser.
1995 B, Subser. B-7, 4.00%,
VRDN due 8/15/18 VMIG-1 A-1+ 100
MUNICIPAL BOND INVESTORS ASSURANCE CORP.
100 New York City (NY) G.O., Ser.
1995 B, Subser. B-4, 4.00%,
VRDN due 8/15/23 VMIG-1 A-1+ 100
------
200
------
TOTAL INVESTMENTS (97.9%)
(COST $9,490) 9,389(3)
Cash, receivables and other
assets, less liabilities
(2.1%) 200
------
TOTAL NET ASSETS (100.0%) $ 9,589
------
</TABLE>
42
<PAGE>
NOTES TO SCHEDULE OF INVESTMENTS
April 30, 1996 (Unaudited)
- ----------------------------------------------------------------------
Income Managers Trust
1)Municipal securities held by Neuberger&Berman Municipal Money Portfolio,
Neuberger&Berman Municipal Securities Portfolio, and Neuberger&Berman New York
Insured Intermediate Portfolio are within the two, three, and four highest
rating categories, respectively, assigned by Moody's Investors Service, Inc.
or Standard & Poor's or, where not rated, are determined by the Portfolio's
investment manager to be of comparable quality within guidelines approved by
the Trustees of Income Managers Trust. Approximately 82%, 35%, and 81% of the
municipal securities held by Neuberger&Berman Municipal Money Portfolio,
Neuberger&Berman Municipal Securities Portfolio, and Neuberger& Berman New
York Insured Intermediate Portfolio, respectively, have credit enhancement
features backing them, which the Portfolios may rely on, such as letters of
credit, insurance, or guarantees. Without these credit enhancement features
the securities may or may not meet the quality standards of the Portfolios.
Pre-refunded bonds are supported by securities in escrow issued or guaranteed
by the U.S. Government, its agencies, or instrumentalities. The amount
escrowed is sufficient to pay the periodic interest due and the principal of
these bonds. Putable bonds give the Portfolios the right to put back the issue
on the date specified.
2)Investment securities of Neuberger&Berman Municipal Money Portfolio are valued
at amortized cost, which approximates Federal income tax cost.
Investment securities of Neuberger&Berman Municipal Securities Portfolio and
Neuberger&Berman New York Insured Intermediate Portfolio are valued daily by
obtaining bid price quotations from an independent pricing service on all
securities available in the service's data base. For all other securities
requiring daily quotations, bid prices are obtained from principal market
makers in those securities or, if quotations are not available, by a method
that the trustees of Income Managers Trust believe accurately reflects fair
value.
3)At April 30, 1996, selected Portfolio information on a Federal income tax
basis was as follows:
<TABLE>
<CAPTION>
GROSS GROSS NET UNREALIZED
UNREALIZED UNREALIZED APPRECIATION
NEUBERGER&BERMAN COST APPRECIATION DEPRECIATION (DEPRECIATION)
------------ --------------- ------------- --------
<S> <C> <C> <C> <C>
MUNICIPAL SECURITIES PORTFOLIO $ 40,129,000 $ 467,000 $ 236,000 $ 231,000
NEW YORK INSURED INTERMEDIATE
PORTFOLIO 9,502,000 40,000 153,000 (113,000)
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
43
<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES
April 30, 1996 (Unaudited)
- ----------------------------------------------------------------------
Income Managers Trust
<TABLE>
<CAPTION>
NEW YORK
MUNICIPAL MUNICIPAL INSURED
MONEY SECURITIES INTERMEDIATE
(000'S OMITTED) PORTFOLIO PORTFOLIO PORTFOLIO
------------------------------------------------
<S> <C> <C> <C>
ASSETS
Investments in securities, at value* (Note
A) -- see Schedule of Investments $ 144,700 $ 40,360 $ 9,389
Cash 1,445 52 72
Deferred organization costs (Note A) 6 2 9
Interest receivable 1,171 559 138
Prepaid expenses and other assets 3 1 --
Receivable for securities sold 7,795 -- --
------------------------------------------------
155,120 40,974 9,608
------------------------------------------------
LIABILITIES
Payable to investment manager (Note B) 34 9 2
Accrued expenses 35 20 17
------------------------------------------------
69 29 19
------------------------------------------------
NET ASSETS Applicable to Investors' Beneficial
Interests $ 155,051 $ 40,945 $ 9,589
------------------------------------------------
NET ASSETS consist of:
Paid-in capital $ 155,051 $ 40,714 $ 9,690
Net unrealized appreciation (depreciation)
in value of investments -- 231 (101)
------------------------------------------------
NET ASSETS $ 155,051 $ 40,945 $ 9,589
------------------------------------------------
*Cost of investments $ 144,700 $ 40,129 $ 9,490
------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
44
<PAGE>
STATEMENTS OF OPERATIONS
For the Six Months Ended April 30, 1996 (Unaudited)
- ----------------------------------------------------------------------
Income Managers Trust
<TABLE>
<CAPTION>
NEW YORK
MUNICIPAL MUNICIPAL INSURED
MONEY SECURITIES INTERMEDIATE
(000'S OMITTED) PORTFOLIO PORTFOLIO PORTFOLIO
------------------------------------------
<S> <C> <C> <C>
INVESTMENT INCOME
Interest income $ 3,091 $ 1,060 $ 253
------------------------------------------
Expenses:
Investment management fee (Note B) 212 53 14
Accounting fees 5 5 5
Amortization of deferred organization and
initial offering expenses (Note A) 2 1 2
Auditing fees 15 11 11
Custodian fees (Note B) 60 19 7
Insurance expense 2 1 --
Legal fees 5 6 6
Trustees' fees and expenses 7 4 3
------------------------------------------
Total expenses 308 100 48
------------------------------------------
Net investment income 2,783 960 205
------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND FINANCIAL FUTURES CONTRACTS
Net realized gain (loss) on investments sold 4 167 (16)
Net realized loss on financial futures
contracts (Note A) -- (51) --
Change in net unrealized appreciation
(depreciation) of investments -- (627) (149)
------------------------------------------
Net gain (loss) on investments and
financial futures contracts 4 (511) (165)
------------------------------------------
Net increase in net assets resulting from
operations $ 2,787 $ 449 $ 40
------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
45
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
- ----------------------------------------------------------------------
Income Managers Trust
<TABLE>
<CAPTION>
MUNICIPAL
MONEY
PORTFOLIO
Six Months
Ended Year
April 30, Ended
1996 October 31,
(000'S OMITTED) (UNAUDITED) 1995
-----------------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income $ 2,783 $ 5,418
Net realized gain (loss) on
investments sold and financial
futures contracts 4 (25)
Change in net unrealized
appreciation (depreciation) of
investments -- --
-----------------------------
Net increase in net assets resulting
from operations 2,787 5,393
-----------------------------
TRANSACTIONS IN INVESTORS' BENEFICIAL
INTERESTS:
Additions 124,238 195,151
Reductions (133,068) (189,913)
-----------------------------
Net increase (decrease) in net
assets resulting from transactions
in investors' beneficial interests (8,830) 5,238
-----------------------------
NET INCREASE (DECREASE) IN NET ASSETS (6,043) 10,631
NET ASSETS:
Beginning of period 161,094 150,463
-----------------------------
End of period $ 155,051 $ 161,094
-----------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
46
<PAGE>
- ----------------------------------------------------------------------
Income Managers Trust
<TABLE>
<CAPTION>
NEW YORK
MUNICIPAL INSURED
SECURITIES INTERMEDIATE
PORTFOLIO PORTFOLIO
Six Months Six Months
Ended Year Ended Year
April 30, Ended April 30, Ended
1996 October 31, 1996 October 31,
(UNAUDITED) 1995 (UNAUDITED) 1995
-------------------------------------------------------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income $ 960 $ 2,045 $ 205 $ 463
Net realized gain (loss) on
investments sold and financial
futures contracts 116 (677) (16) (95)
Change in net unrealized
appreciation (depreciation) of
investments (627) 2,886 (149) 938
-------------------------------------------------------------
Net increase in net assets resulting
from operations 449 4,254 40 1,306
-------------------------------------------------------------
TRANSACTIONS IN INVESTORS' BENEFICIAL
INTERESTS:
Additions 1,856 6,875 1,013 3,851
Reductions (5,780) (18,071) (2,981) (8,400)
-------------------------------------------------------------
Net increase (decrease) in net
assets resulting from transactions
in investors' beneficial interests (3,924) (11,196) (1,968) (4,549)
-------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS (3,475) (6,942) (1,928) (3,243)
NET ASSETS:
Beginning of period 44,420 51,362 11,517 14,760
-------------------------------------------------------------
End of period $ 40,945 $ 44,420 $ 9,589 $ 11,517
-------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
47
<PAGE>
NOTES TO FINANCIAL STATEMENTS
April 30, 1996 (Unaudited)
- ----------------------------------------------------------------------
Income Managers Trust
NOTE A -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
1) GENERAL: Neuberger&Berman Municipal Money Portfolio ("Municipal
Money"), Neuberger&Berman Municipal Securities Portfolio ("Municipal
Securities"), and Neuberger&Berman New York Insured Intermediate Portfolio
("New York Insured Intermediate") (collectively, the "Portfolios") are
separate operating series of Income Managers Trust ("Managers Trust"), a New
York common law trust organized as of December 1, 1992. Managers Trust is
registered as an open-end management investment company under the Investment
Company Act of 1940, as amended. Other regulated investment companies
sponsored by Neuberger&Berman Management Incorporated ("Management"), whose
financial statements are not presented herein, also invest in Managers Trust.
The assets of each series belong only to that series, and the liabilities
of each series are borne solely by that series and no other.
2) PORTFOLIO VALUATION: Investment securities are valued as indicated in the
notes following the Portfolios' schedule of investments.
3) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities transactions are
recorded on a trade date basis. Interest income, including accretion of
discount (adjusted for original issue discount, where applicable) and
amortization of premium, is recorded on the accrual basis. Realized gains and
losses from securities transactions are recorded on the basis of identified
cost.
4) FEDERAL INCOME TAXES: Managers Trust intends to comply with the
requirements of the Internal Revenue Code of 1986, as amended. Each Portfolio
of Managers Trust also intends to conduct its operations so that each of its
investors will be able to qualify as a regulated investment company. Each
Portfolio will be treated as a partnership for Federal income tax purposes
and is therefore not subject to Federal income tax.
5) ORGANIZATION EXPENSES: Expenses incurred by each Portfolio in connection
with its organization are being amortized by each Portfolio on a
straight-line basis over a five-year period. At April 30, 1996, the
unamortized balance of such expenses amounted to $6,389, $2,260, and $9,339
for Municipal Money, Municipal Securities, and New York Insured Intermediate,
respectively.
6) EXPENSE ALLOCATION: The Portfolios bear all costs of operations. Expenses
incurred by Managers Trust with respect to any two or more Portfolios are
allocated in proportion to the net assets of such Portfolios, except where a
more appropriate allocation of expenses to each Portfolio can otherwise be
made fairly. Expenses directly attributable to a Portfolio are charged to
that Portfolio.
48
<PAGE>
7) FINANCIAL FUTURES CONTRACTS: Municipal Securities and New York Insured
Intermediate may buy and sell financial futures contracts to hedge against
the effects of fluctuations in interest rates. At the time a Portfolio enters
into a financial futures contract, it is required to deposit with its
custodian a specified amount of cash or U.S. Government securities, known as
"initial margin," ranging upward from 1.1% of the value of the financial
futures contract being traded. Each day, the futures contract is valued at
the official settlement price of the board of trade or U.S. commodity
exchange on which such futures contract is traded. Subsequent payments, known
as "variation margin," to and from the broker are made on a daily basis as
the market price of the financial futures contract fluctuates. Daily
variation margin adjustments, arising from this "mark to market," are
recorded by the Portfolio as unrealized gains or losses.
Although some financial futures contracts by their terms call for actual
delivery or acceptance of financial instruments, in most cases the contracts
are closed out prior to delivery by offsetting purchases or sales of matching
financial futures contracts. When the contracts are closed, the Portfolio
recognizes a gain or loss. Risks of entering into futures contracts include
the possibility that there may be an illiquid market and/or that a change in
the value of the contract may not correlate with changes in the value of the
underlying securities.
For Federal income tax purposes, the futures transactions undertaken by a
Portfolio may cause a Portfolio to recognize gains or losses from marking to
market even though its positions have not been sold or terminated, may affect
the character of the gains or losses recognized as long-term or short-term,
and may affect the timing of some capital gains and losses realized by the
Portfolio. Also, the Portfolio's losses on its transactions involving futures
contracts may be deferred rather than being taken into account currently in
calculating such Portfolio's taxable income. During the six months ended
April 30, 1996, Municipal Securities entered into financial futures
contracts. There were no open positions in financial futures contracts at
April 30, 1996.
NOTE B -- MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES:
Each Portfolio retains Management as its investment manager under a
Management Agreement dated as of July 2, 1993 (February 1, 1994 with respect to
New York Insured Intermediate). For such investment management services, each
Portfolio pays Management a fee at the annual rate of .25% of the first $500
million of that Portfolio's average daily net assets, .225% of the next $500
million, .20% of the next $500 million, .175% of the next $500 million, and .15%
of average daily net assets in excess of $2 billion.
All of the capital stock of Management is owned by individuals who are also
general partners of Neuberger&Berman, L.P. ("Neuberger"), a member firm of The
New York Stock Exchange and the sub-adviser to each Portfolio. Neuberger is
49
<PAGE>
retained by Management to furnish it with investment recommendations and
research information without cost to each Portfolio. Several individuals who are
officers and/ or trustees of Managers Trust are also partners of Neuberger
and/or officers and/or directors of Management.
Each Portfolio has an expense offset arrangement included in its custodian
contract. The impact of this arrangement on each Portfolio's custodian expense,
reflected in the Statement of Operations, is less than .01% of the Portfolio's
average daily net assets.
NOTE C -- SECURITIES TRANSACTIONS:
During the six months ended April 30, 1996, there were purchase and sale
transactions (excluding short-term securities and financial futures contracts)
as follows:
<TABLE>
<CAPTION>
PURCHASES SALES
- ---------------------------------------------------------------
<S> <C> <C>
MUNICIPAL SECURITIES $ 0 $ 4,883,640
NEW YORK INSURED INTERMEDIATE 3,088,483 2,808,034
</TABLE>
All securities transactions for Municipal Money were short-term.
NOTE D -- UNAUDITED FINANCIAL INFORMATION:
The financial information included in this interim report is taken from the
records of each Portfolio without audit by independent auditors. Annual reports
contain audited financial statements.
50
<PAGE>
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Income Managers Trust
<TABLE>
<CAPTION>
MUNICIPAL
MONEY
PORTFOLIO
Period from
July 2,
1993
(Commencement
Six Months of
Ended Operations)
April 30, Year Ended October to October
1996 31, 31,
(UNAUDITED) 1995 1994 1993
-----------------------------------------------
<S> <C> <C> <C> <C>
RATIOS TO AVERAGE NET ASSETS:
Expenses .36%(1) .36% .36% .36%(1)
-----------------------------------------------
Net Investment Income 3.28%(1) 3.57% 2.38% 2.20%(1)
-----------------------------------------------
Portfolio Turnover Rate -- -- -- --
-----------------------------------------------
Net Assets, End of Period (in
millions) $155.1 $161.1 $150.5 $181.8
-----------------------------------------------
</TABLE>
1) Annualized.
51
<PAGE>
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Income Managers Trust
<TABLE>
<CAPTION>
MUNICIPAL
SECURITIES
PORTFOLIO
Period from
July 2,
1993
(Commencement
Six Months of
Ended Operations)
April 30, Year Ended October to October
1996 31, 31,
(UNAUDITED) 1995 1994 1993
-----------------------------------------------
<S> <C> <C> <C> <C>
RATIOS TO AVERAGE NET ASSETS:
Expenses .46%(1) .46% .40% .42%(1)
-----------------------------------------------
Net Investment Income 4.47%(1) 4.63% 4.47% 4.21%(1)
-----------------------------------------------
Portfolio Turnover Rate 0% 66% 127% 25%
-----------------------------------------------
Net Assets, End of Period (in
millions) $40.9 $44.4 $51.4 $104.3
-----------------------------------------------
</TABLE>
1) Annualized.
52
<PAGE>
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Income Managers Trust
<TABLE>
<CAPTION>
NEW YORK
INSURED
INTERMEDIATE
PORTFOLIO
Period from
February 1,
1994
(Commencement
Six Months Year of
Ended Ended Operations)
April 30, October to October
1996 31, 31,
(UNAUDITED) 1995 1994
------------------------------------
<S> <C> <C> <C>
RATIOS TO AVERAGE NET ASSETS:
Expenses .88%(1) .85% .82%(1)
------------------------------------
Net Investment Income 3.78%(1) 4.05% 3.92%(1)
------------------------------------
Portfolio Turnover Rate 28% 17% 96%
------------------------------------
Net Assets, End of Period (in
millions) $9.6 $11.5 $14.8
------------------------------------
</TABLE>
1) Annualized.
53
<PAGE>
OTHER INFORMATION
<TABLE>
<S> <C>
DIRECTORY OFFICERS AND TRUSTEES
INVESTMENT MANAGER, ADMINISTRA- Stanley Egener
TOR, CHAIRMAN OF THE BOARD AND TRUSTEE
AND DISTRIBUTOR Theresa A. Havell
Neuberger&Berman Management In- PRESIDENT AND TRUSTEE
corporated John Cannon
605 Third Avenue 2nd Floor TRUSTEE
New York, NY 10158-0180 Charles DeCarlo
800-877-9700 TRUSTEE
Institutional Services Barry Hirsch
800-366-6264 TRUSTEE
SUB-ADVISER Robert A. Kavesh
Neuberger&Berman, L.P. TRUSTEE
605 Third Avenue Harold R. Logan
New York, NY 10158-3698 TRUSTEE
CUSTODIAN AND SHAREHOLDER William E. Rulon
SERVICING AGENT TRUSTEE
State Street Bank and Trust Candace L. Straight
Company TRUSTEE
225 Franklin Street Daniel J. Sullivan
Boston, MA 02110 VICE PRESIDENT
ADDRESS CORRESPONDENCE TO: Michael J. Weiner
Neuberger&Berman Funds VICE PRESIDENT
Boston Service Center Richard Russell
P.O. Box 8403 TREASURER
Boston, MA 02266-8403 Claudia A. Brandon
800-225-1596 SECRETARY
LEGAL COUNSEL Barbara DiGiorgio
Kirkpatrick & Lockhart LLP ASSISTANT TREASURER
1800 Massachusetts Avenue, NW Celeste Wischerth
2nd Floor ASSISTANT TREASURER
Washington, DC 20036-1800 Stacy Cooper-Shugrue
ASSISTANT SECRETARY
C. Carl Randolph
ASSISTANT SECRETARY
</TABLE>
Neuberger&Berman Management Inc., Neuberger&Berman Municipal Money Fund,
Neuberger&Berman Municipal Securities Trust, and Neuberger&Berman New York
Insured Intermediate Fund are registered servicemarks of Neuberger&Berman
Management Inc.
- -C- 1996 Neuberger&Berman Management Inc.
54
<PAGE>
NEUBERGER&BERMAN MANAGEMENT INC. -Registered Trademark-
605 THIRD AVENUE 2ND FLOOR
NEW YORK, NY 10158-0180
SHAREHOLDER SERVICES
800.877.9700
INSTITUTIONAL SERVICES
800.366.6264
Statistics and projections in this report are derived from sources
deemed to be reliable but cannot be regarded as a representation of
future results of the Funds. This report is prepared for the general
information of shareholders and is not an offer of shares of the Funds.
Shares are sold only through the currently effective prospectus, which
must precede or accompany this report.
[LOGO] PRINTED ON RECYCLED PAPER
WITH SOY BASED INKS NBMFSAR00496
<PAGE>
