MAY 5, 1999
Supplement to the PaineWebber Financial Services Growth Fund Inc. and
PaineWebber Utility Income Fund Prospectus Dated August 1, 1998
Dear Investor,
This is a supplement to the Prospectus of PaineWebber Financial Services
Growth Fund Inc. and PaineWebber Utility Income Fund ("Funds").
THE FOLLOWING REPLACES ANY PRIOR SUPPLEMENTS RELATING TO THE INFORMATION
CONTAINED UNDER THE FOLLOWING HEADINGS IN THE "MANAGEMENT" SECTION OF THE FUNDS
ON PROSPECTUS P. 26:
FINANCIAL SERVICES GROWTH FUND. The Fund is governed by a board of directors,
which oversees the Fund's operations. It has appointed Mitchell Hutchins as
investment adviser and administrator responsible for the Fund's operations
(subject to the authority of the board). Mark Tincher and Andrew B. Dinnhaupt
are primarily responsible for the day-to-day portfolio management of the Fund.
Mr. Tincher is a managing director and chief investment officer of equities of
Mitchell Hutchins, responsible for overseeing the management of equity
investments. Prior to joining Mitchell Hutchins in April 1995, Mr. Tincher
worked for Chase Manhattan Private Bank where he was vice president and directed
the U.S. funds management and equity research area and oversaw the management of
all Chase U.S. equity funds. Mr. Dinnhaupt is a vice president of Mitchell
Hutchins and a financial services analyst. Prior to joining Mitchell Hutchins in
July 1996, Mr. Dinnhaupt worked at Summit Bank as an investment officer,
portfolio manager, credit analyst and financial services analyst beginning in
1989.
UTILITY INCOME FUND. The Fund is governed by a board of directors, which
oversees the Fund's operations. It has appointed Mitchell Hutchins as investment
adviser and administrator responsible for the Fund's operations (subject to the
authority of the board). Mr. Tincher (see above) and Christopher T. Solmssen are
primarily responsible for the day-to-day management of the Fund's stock
portfolio. James F. Keegan and Julieanna Berry are primarily responsible for
day-to-day management of the Fund's bond portfolio. Mr. Solmssen is a Vice
President of Mitchell Hutchins and an equity analyst covering utilities,
telecommunications and energy. Prior to joining Mitchell Hutchins in January
1998, Mr. Solmssen worked at Sun America Asset Management as an equity analyst
beginning in 1995. Mrs. Berry has held her Fund responsibilities since March
1996 and was joined by Mr. Keegan in April 1996. Mrs. Berry is a first vice
president of Mitchell Hutchins and has been employed by Mitchell Hutchins as a
portfolio manager since 1989. Mr. Keegan is a senior vice president of Mitchell
Hutchins and oversees all corporate bond investments. Prior to joining Mitchell
Hutchins, Mr. Keegan was the director of fixed income strategy and research at
the Merrion Group, L.P. from 1994 to 1995. From 1987 to 1994, he was vice
president of global investment management of Bankers Trust Company.
