NEUBERGER & BERMAN INCOME FUNDS
Supplement dated June 26, 1997 to
Statement of Additional Information dated February 3, 1997
INVESTMENT INFORMATION
The section regarding banking and savings institution securities (page 11) is
revised to read as follows:
Banking and Savings Institution Securities (All Portfolios except
Neuberger & Berman GOVERNMENT MONEY Portfolio). The Portfolios may invest in
banking and savings institution obligations, which include CDs, time deposits,
bankers' acceptances, and other short-term debt obligations issued by commercial
banks and savings institutions. CDs are receipts for funds deposited for a
specified period of time at a specified rate of return; time deposits generally
are similar to CDs, but are uncertificated. Bankers' acceptances are time drafts
drawn on commercial banks by borrowers, usually in connection with international
commercial transactions. The CDs, time deposits, and bankers' acceptances in
which the Portfolios invest typically are not covered by deposit insurance.
A Portfolio may invest in securities issued by a commercial bank or
savings institution only if (1) the bank or institution has total assets of at
least $1,000,000,000, (2) the bank or institution is on N&B Management's
approved list, and (3) in the case of a foreign bank or institution, the
securities are, in N&B Management's opinion, of an investment quality comparable
with other debt securities that may be purchased by the Portfolio. These
limitations do not apply to Neuberger & Berman LIMITED MATURITY Bond Portfolio
and Neuberger & Berman ULTRA SHORT BOND Portfolio and do not prohibit
investments in securities issued by foreign branches of U.S. banks that meet the
foregoing requirements.
