DREYFUS MUNICIPAL BOND FUND, INC.
LETTER TO SHAREHOLDERS
Dear Shareholder:
We are pleased to provide you with this report on the Dreyfus Municipal
Bond Fund, Inc. For its semi-annual reporting period ended February 29, 1996,
your Fund produced a total return, including bond price changes and interest
income, of 4.21%.* Income dividends exempt from Federal personal income taxes
of approximately $.349 per share were paid.** This is equivalent to a
tax-free annualized distribution rate per share of 5.56%***.
THE ECONOMY
The United States has entered its sixth year of economic expansion
accompanied by increasing signs that growth is slowing. The systematic
reduction in short-term interest rates by the Federal Reserve Board that
began last July has not yet served as a stimulus to economic activity. Over
the past 12 months, the Fed has kept a cautious eye on price trends,
concerned that undue monetary stimulus would rekindle inflationary pressures.
Yet, inflation has continued at a moderate pace; the Consumer Price Index
rose 2.5% last year.
The economy, heavily influenced by the increasingly cautious spending
patterns of consumers, has weakened markedly. The Commerce Department
reported that fourth-quarter 1995 Gross Domestic Product grew at an annual
rate of only 0.9%. For the full year, GDP grew only 2.1% compared with
aggregate economic growth of 3.5% in 1994. The most dramatic sign of weakness
was in the consumer sector where personal consumption expenditures expanded
at an annualized rate of only 0.8%, sharply lower than the third-quarter rate
of 2.8%. While exports remained strong, there are developing signs of
economic weakness with some of our major trading partners, including Japan,
Germany, Canada and Mexico.
Output at the nation's factories declined sharply in January, the largest
decline in nearly five years. No doubt influenced in some measure by the bad
winter weather, the output figures reflect a continued softening in the
economy. Production growth in 1995 (+3.2%) was little more than half its 1994
rate (+5.9%). The Capacity Utilization Rate also declined in January. This
hints at a continued moderation in inflation since a declining rate suggests
a lack of production bottlenecks that could result in price increases.
Business inventories have continued to rise and consumers remain
reluctant to spend. Holiday retail sales were at the lowest level since the
1990-91 recession. The slow rate of increase in wages and benefits - up only
2.9% in 1995, the smallest rise since 1980 - was a key factor in consumer
spending wariness. This moderate wage increase helped businesses control
their costs (payrolls account for about 70% of business expenses) but does
not help the consumer side of the economic equation. Given that consumers
represent about two thirds of all economic activity, their retrenchment could
continue to retard prospects for economic growth.
THE MARKET
The Federal Reserve refrained from overt action on short-term interest
rates in February after reducing the Federal Funds Rate in each of the two
previous months. Alan Greenspan, recently reappointed to his third term as
chairman of the Federal Reserve, roiled the capital markets with his
testimony to Congress which indicated that the economy may be in better shape
than some investors thought. The implication was that further reductions in
interest rates may not be as imminent as many assumed. Accordingly, bond
prices fell sharply, driving interest rates back to October 1995 levels.
THE PORTFOLIO
After writing to you at the end of last summer, we modified our
investment approach to increase the representation of discount bonds, which
have lower coupons than those that are attached to bonds currently being
issued. Our sense was that the downward trend in interest rates had further
to go, and your Fund could best capitalize on the market's capital gain
potential by de-emphasizing current coupons, and favoring discounts. Because
we had already populated the Fund's portfolio heavily with current coupons,
our objective had been attained: the Fund was earning an attractive current
return, and was also defensively postured in case the fixed income markets
began to lose some of their lustre. We think the combination of full-coupon
bonds and discount coupon securities is most appropriate at the current time.
Since the beginning of 1996, the municipal bond market, along with other
fixed income markets, has evinced ambivalence as to the direction of interest
rates, economic vitality, and inflation. As a result, prices have eroded, and
yields have climbed: the Bond Buyer 20-Bond Index****, which yielded 5.37% on
January 4, was at 5.81% on March 14, following the release of the February
employment report which showed a surprising gain in newly created jobs.
Economic data continue mixed, so it is a time for investors to be especially
nimble and alert. As we find promising investments available, it is our goal
to take advantage of them in order to continue to enhance the value of your
investment.
Included in this report is a series of detailed statements about your
Fund's holdings and its financial condition. We hope they are informative.
Please know that we appreciate greatly your continued confidence in the Fund
and in The Dreyfus Corporation.
Very truly yours,
[Richard J. Moynihan signature logo]
Richard J. Moynihan
Director, Municipal Portfolio Management
The Dreyfus Corporation
March 15, 1996
New York, N.Y.
* Total return includes reinvestment of dividends and any capital gains
paid.
**Some income may be subject to the Federal Alternative Minimum Tax (AMT) for
certain shareholders.
*** Annualized distribution rate per share is based upon dividends per
share paid from net investment income during the
period, divided by the net asset value per share at the end of the period.
**** The Bond Buyer 20-Bond Index is composed of twenty General Obligation
Bonds maturing in twenty years, that have a rating
roughly equivalent to A1.
<TABLE>
<CAPTION>
DREYFUS MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS FEBRUARY 29, 1996 (UNAUDITED)
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS-97.5% AMOUNT VALUE
________ ________
<S> <C> <C>
ALABAMA-1.3%
Alabama Housing Finance Authority, SFMR:
6.80%, 4/1/2025......................................................... $4,920,000 $5,146,123
6.45%, 10/1/2025........................................................ 8,000,000 8,177,440
Fairfield Industrial Development Board, Environmental Improvement Revenue, Refunding
(USX Corp. Project) 6.70%, 12/1/2024.................................... 8,500,000 8,694,905
Industrial Development Board of the Town of Courtland, SWDR
(Champion International Corp. Project) 7%, 11/1/2022.................... 8,100,000 8,629,254
West Jefferson Industrial Development Board, PCR, Refunding
(Alabama Power Co.-Miller Plant) 6.05%, 5/1/2023 (Insured; MBIA)........ 15,000,000 15,621,750
ALASKA-2.4%
Alaska Housing Finance Corp. (Collateralized Veterans Mortgage Program)
6.375%, 12/1/2027....................................................... 9,135,000 9,269,467
Anchorage, Electric Utility Revenue, Refunding 6.50%, 12/1/2015 (Insured; MBIA) 6,135,000 6,992,428
Valdez, Marine Terminal Revenue, Refunding (BP Pipeline Inc. Project)
5.85%, 8/1/2025......................................................... 70,000,000 69,365,100
CALIFORNIA-5.0%
Airport Commission City and County of San Francisco
(San Francisco International Airport) 6.50%, 5/1/2015 (Insured; FGIC)... 10,100,000 10,966,479
California Department Water Resource, Water System Revenue (Central Valley Project)
5%, 12/1/2022........................................................... 10,000,000 9,283,200
California Higher Education Loan Authority, Inc., Student Loan Revenue,
Refunding
6.50%, 6/1/2005......................................................... 19,250,000 20,710,690
California Housing Finance Agency, Single Family Mortgage 6.45%, 8/1/2025... 13,125,000 13,602,619
East Bay Municipal Utility District, Wastewater System Subordinated Revenue, Refunding
5%, 6/1/2026 (Insured; FGIC)............................................ 16,300,000 15,092,496
Foothill/Eastern Transportation Corridor Agency, Toll Road Revenue
6.50%, 1/1/2032......................................................... 39,875,000 40,694,431
Long Beach, Harbor Revenue 5.25%, 5/15/2025 (Insured; MBIA)................. 30,000,000 28,026,900
Los Angeles County Metropolitan Transportation Authority, Sales Tax Revenue, Refunding
5%, 7/1/2021 (Insured; FGIC)............................................ 26,105,000 24,012,684
San Diego County, COP, Refunding (Interim Justice Facilities Project) 6.50%, 8/1/2007 10,110,000 10,785,045
State Public Works Board of the State of California, LR
(Various University of California Projects) 6.375%, 10/1/2019........... 5,000,000 5,316,350
COLORADO-2.2%
Arapahoe County Capital Improvement Trust Fund, Highway Revenue (E-470 Project)
7%, 8/31/2026........................................................... 15,000,000 16,521,600
City and County of Denver, Airport Revenue:
8%, 11/15/2017.......................................................... 8,175,000 8,767,197
DREYFUS MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) FEBRUARY 29, 1996 (UNAUDITED)
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
________ ________
COLORADO (CONTINUED)
City and County of Denver, Airport Revenue (continued):
6.75%, 11/15/2022....................................................... $ 9,500,000 $9,888,550
7.25%, 11/15/2023....................................................... 25,765,000 29,363,340
8.50%, 11/15/2023....................................................... 12,750,000 14,905,770
CONNECTICUT-1.1%
Connecticut Housing Finance Authority (Housing Mortgage Finance Program):
6.70%, 11/15/2012....................................................... 4,000,000 4,220,640
6.30%, 5/15/2024........................................................ 8,000,000 8,121,840
6.50%, 5/15/2027........................................................ 18,500,000 18,821,715
Connecticut Resource Recovery Authority (American Fuel Co. Project)
6.45%, 11/15/2022....................................................... 7,325,000 7,679,310
DELAWARE-.6%
Delaware Economic Development Authority, Water Development Revenue
(Wilmington Suburban Water Corp. Project) 6.80%, 12/1/2023.............. 8,000,000 8,483,040
Delaware Housing Authority, Senior SFMR 6.45%, 1/1/2026..................... 13,200,000 13,335,960
DISTRICT OF COLUMBIA-1.9%
Metropolitan Washington Airports Authority, Airport System Revenue:
6.625%, 10/1/2012 (Insured; MBIA)....................................... 40,400,000 43,785,116
6.625%, 10/1/2019 (Insured; MBIA)....................................... 23,600,000 25,427,112
FLORIDA-3.6%
Brevard County Housing Finance Authority, SFMR 6.80%, 3/1/2028.............. 9,500,000 9,809,035
Charlotte County, HR (Bon Secours Health System-Saint Joseph's Hospital Project)
8.25%, 8/15/2018 (Prerefunded 8/15/1998) (a)............................ 7,000,000 7,859,810
Collier County School Board, COP 5%, 2/15/2016 (Insured; FSA)............... 6,500,000 6,135,285
Florida (Jacksonville Transportation Authority) 9.20%, 1/1/2015............. 2,000,000 2,828,260
Florida Community Services Corp. Walton County, Water and Sewer Revenue
(South Walton County Regional Utility):
6.95%, 3/1/2012....................................................... 3,000,000 3,419,850
7%, 3/1/2018.......................................................... 3,500,000 3,917,795
Hillsborough County, Capital Improvement Non-Ad Valorem, Revenue, Refunding
(County Center Project) 5.125%, 7/1/2022 (Insured; MBIA)................ 17,050,000 16,085,481
Palm Beach County, Solid Waste IDR:
(Okeelanta Power Limited Partnership Project) 6.70%, 2/15/2015.......... 23,400,000 23,860,278
(Osceola Power Limited Partnership) 6.95%, 1/1/2022..................... 33,800,000 34,515,208
Saint Johns River Water Management District, Land Acquisition Revenue, Refunding
5.125%, 7/1/2016 (Insured; FSA)......................................... 19,000,000 18,166,470
Volusia County, Airport System Revenue (Daytona Beach Regional Airport):
7%, 10/1/2021 (Insured; MBIA) (Prerefunded 10/1/2000) (a)............... 810,000 921,488
7%, 10/1/2021 (Insured; MBIA)........................................... 2,390,000 2,631,653
DREYFUS MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) FEBRUARY 29, 1996 (UNAUDITED)
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
________ ________
GEORGIA-.8%
Georgia Housing and Finance Authority:
Homeownership Mortgage Zero Coupon, 12/1/2031........................... $ 122,735,000 $9,039,433
Single Family Mortgage:
7.125%, 12/1/2026..................................................... 10,000,000 10,556,100
6.55%, 12/1/2027...................................................... 5,495,000 5,611,604
Georgia Residential Finance Authority, Single Family Insured Mortgage
8.30%, 12/1/2019........................................................ 2,000,000 2,117,820
IDAHO-.9%
Idaho Housing Agency:
Multi-Family Housing Refunding 6.70%, 7/1/2024.......................... 10,050,000 10,404,966
Single Family Mortgage:
6.40%, 7/1/2027....................................................... 8,345,000 8,441,635
6.45%, 7/1/2027....................................................... 8,460,000 8,560,843
6.60%, 7/1/2027....................................................... 4,365,000 4,480,061
ILLINOIS-7.8%
Bryant, PCR, Refunding (Central Illinois Light Co. Project) 5.90%, 8/1/2023. 11,000,000 11,086,350
Chicago:
Refunding 5.125%, 1/1/2016.............................................. 6,250,000 5,928,875
Wastewater Transmission Revenue, Refunding 5.125%, 1/1/2025 (Insured; FGIC) 16,500,000 15,328,170
Chicago O'Hare International Airport, Special Facilities Revenue:
(Lufthansa German Airlines Project)
7.125%, 5/1/2018 (LOC; Bayerische Vereinsbank) (b).................... 4,650,000 4,934,068
(United Airlines Inc. Project):
8.40%, 5/1/2018....................................................... 20,135,000 22,120,915
8.50%, 5/1/2018....................................................... 6,500,000 7,290,010
8.85%, 5/1/2018....................................................... 15,415,000 17,741,432
Illinois Development Finance Authority, Revenue:
(Community Rehabilitation Providers Facilities) 8.75%, 3/1/2010......... 19,365,000 20,920,203
Environmental Facilities (Citizens Utilities Co. Project) 5.90%, 11/15/2028 5,490,000 5,442,237
Pollution Control, Refunding (Central Illinois Public Service Co.):
5.70%, 8/15/2026...................................................... 8,650,000 8,612,545
6.375%, 1/1/2028...................................................... 14,000,000 14,535,640
Illinois Educational Facilities Authority, Revenue:
(Art Institute of Chicago) 5.80%, 3/1/2027.............................. 4,475,000 4,389,796
(Illinois Institute of Technology) Refunding 6.875%, 12/1/2015.......... 7,250,000 7,690,437
Illinois Health Facilities Authority, Revenue:
(Beverly Farm Foundation) 9.125%, 12/15/2015............................ 3,730,000 4,067,975
Refunding:
(Evangelical Hospitals) 6.50%, 4/15/2009 (Insured; FSA)............... 5,000,000 5,502,850
(Mercy Hospital and Medical Center) 7%, 1/1/2015...................... 7,500,000 7,789,500
DREYFUS MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) FEBRUARY 29, 1996 (UNAUDITED)
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
________ ________
ILLINOIS (CONTINUED)
Illinois Health Facilities Authority, Revenue (continued):
(Southern Illinois Hospital Services) 5.85%, 3/1/2014 (Insured; MBIA)... $7,275,000 $7,360,045
(Trinity Medical Center) 7%, 7/1/2012................................... 3,000,000 3,029,550
Illinois Housing Development Authority:
Homeowner Mortgage Revenue:
6.45%, 8/1/2017....................................................... 6,500,000 6,673,160
6.70%, 8/1/2025....................................................... 4,980,000 5,126,362
6.625%, Subseries B-2, 8/1/2026....................................... 15,385,000 15,767,625
6.625%, Subseries C-2, 8/1/2026....................................... 2,200,000 2,255,660
Multi-Family Housing (Lawndale Redevelopment Project) 6.90%, 12/1/2026.. 8,750,000 9,150,662
Multi-Family Program 6.75%, 9/1/2021.................................... 8,750,000 9,029,562
Section 8 Elderly Housing Revenue (Morningside North Development)
6.85%, 1/1/2021....................................................... 11,220,000 11,670,371
Peru, Electric System Revenue 5.75%, 5/1/2025 (Insured; FGIC)............... 6,750,000 6,735,150
Robbins (Resource Recovery Partners) 9.25%, 10/15/2014...................... 32,000,000 31,067,840
Solid Waste Agency of Northern Cook County, Contract Revenue, Refunding
5.50%, 5/1/2015 (Insured; MBIA)......................................... 9,000,000 8,785,800
INDIANA-7.5%
Allen County, COP, Refunding 6.50%, 11/1/2008............................... 5,000,000 5,365,850
Brownsburg School Building Corp., First Mortgage 6.10%, 2/1/2013 (Insured; FSA) 7,500,000 7,843,500
Danville Community Elementary School Building Corp., First Mortgage
6.90%, 1/15/2010 (Prerefunded 1/15/2002) (a)............................ 4,400,000 5,027,176
Fort Wayne Hospital Authority, HR (Lutheran Hospital)
8%, 2/15/2003 (Prerefunded 2/15/1998) (a)............................... 7,000,000 7,681,870
Hammond Multi-School Building Corp., First Mortgage:
6%, 1/15/2013........................................................... 1,760,000 1,851,854
7.10%, 1/15/2015 (Prerefunded 7/15/2001) (a)............................ 5,585,000 6,434,702
6%, 1/15/2018........................................................... 1,250,000 1,343,825
Indiana Development Finance Authority, Environmental Revenue (PSI Energy Inc.)
5.75%, 2/15/2028........................................................ 8,000,000 7,890,400
Indiana Office Building Commission, Correctional Facilities Program Revenue
6.375%, 7/1/2016........................................................ 25,000,000 26,114,750
Indiana Transportation Finance Authority, Airport Facility LR 6.50%, 11/1/2007 12,500,000 13,454,000
Indianapolis Airport Authority, Special Facility Revenue (United Airlines
Project)
6.50%, 11/15/2031....................................................... 31,125,000 31,864,530
Indianapolis Local Public Improvement Bond Bank
8.50%, 2/1/2018 (Prerefunded 2/1/1998) (a).............................. 73,000,000 80,757,710
IPS School Building Corp., First Mortgage 6.10%, 1/15/2020.................. 11,000,000 11,405,680
DREYFUS MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) FEBRUARY 29, 1996 (UNAUDITED)
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
________ ________
INDIANA (CONTINUED)
Jefferson County Hospital Authority, Hospital Facility Revenue, Refunding
(Kings Daughter's Hospital) 8.50%, 8/15/2013............................ $ 3,000,000 $3,265,260
Lake Central Multi-District School Building Corp., First Mortgage Refunding
5.375%, 7/1/2012........................................................ 4,360,000 4,332,968
Lebanon High School Building Corp., First Mortgage Refunding 5.75%, 7/1/2005 2,000,000 2,090,700
Logansport Multi-Purpose School Building Corp., First Mortgage Refunding
6%, 1/1/2009............................................................ 7,645,000 7,956,840
Monroe County Community School Corp., School Building Corp.,
First Mortgage Refunding 6.60%, 7/1/2009................................ 3,080,000 3,376,450
New Prairie United School Building Corp., First Mortgage Refunding
5.50%, 7/5/2015 (Insured; FSA).......................................... 5,240,000 5,144,789
Noblesville High School Building Corp., First Mortgage 5.75%, 2/15/2015..... 20,060,000 20,139,237
Westfield High School 1995 Building Corp., First Mortgage:
5.70%, 7/15/2013 (Insured; AMBAC)....................................... 3,000,000 3,047,490
5.80%, 7/15/2018 (Insured; AMBAC)....................................... 10,000,000 10,061,300
IOWA-.5%
Iowa Finance Authority, Revenue:
Hospital Facility Refunding (Jennie Edmundson Memorial Hospital)
7.65%, 11/1/2016...................................................... 4,850,000 5,177,666
Single Family Mortgage (Mortgage Backed Securities Program) 6.65%, 7/1/2028 12,070,000 12,444,653
KANSAS-1.6%
Wichita, HR 6.464%, 10/1/2022 (Insured; MBIA)............................... 51,300,000 55,604,583
KENTUCKY-2.5%
City of Ashland, Sewage and Solid Waste Revenue (Ashland Inc. Project)
7.125%, 2/1/2022........................................................ 13,170,000 14,277,860
Kenton County Airport Board, Airport Revenue:
(Greater Cincinnati International Airport):
8.25%, 3/1/2015 (Prerefunded 3/1/1998) (a)............................ 2,395,000 2,643,841
8.25%, 3/1/2015....................................................... 10,945,000 11,929,393
Special Facilities (Delta Airlines Project) 7.125%, 2/1/2021............ 8,455,000 8,987,073
Mount Sterling, LR (Kentucky League Cities Funding):
6.15%, 3/1/2013......................................................... 5,000,000 5,077,600
6.10%, 3/1/2018......................................................... 7,955,000 8,224,356
Pendleton County, Multi-County Lease Revenue
(Kentucky Associates Counties Leasing Trust Program) 6.50%, 3/1/2019.... 26,000,000 27,458,600
Trimble County, PCR (Louisville Gas and Electric Co. Project):
7.625%, 11/1/2020 (Prerefunded 11/1/2000) (a)........................... 1,445,000 1,680,679
7.625%, 11/1/2020....................................................... 7,555,000 8,451,099
DREYFUS MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) FEBRUARY 29, 1996 (UNAUDITED)
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
________ ________
LOUISIANA-1.5%
DeSoto Parish Environmental Improvement Revenue, Refunding
(International Paper Co. Project) 6.55%, 4/1/2019....................... $ 3,000,000 $3,113,370
Louisiana Public Facilities Authority, Revenue (Tulane University of Louisiana):
6.625%, 11/15/2021...................................................... 7,270,000 7,785,152
6.625%, 11/15/2021 (Prerefunded 11/15/2002) (a)......................... 2,150,000 2,454,612
Parish of Saint Charles, PCR (Louisiana Power and Lighting Co. Project)
8.25%, 6/1/2014......................................................... 7,500,000 8,373,600
Parish of West Feliciana, PCR:
(Gulf States Utilities Co. Project) 9%, 5/1/2015........................ 13,500,000 15,316,830
(Gulf States Utilities-I) 7.70%, 12/1/2014.............................. 14,000,000 15,325,800
MAINE-1.1%
Jay, SWDR (International Paper Co. Project) 6%, 12/1/2017................... 7,105,000 7,051,357
Maine Financial Authority, Solid Waste Revenue Recycling Facilities
(Great Northern Paper, Inc. Project-Bowater Inc. Obligor) 7.75%, 10/1/2022 8,165,000 8,963,619
Maine Housing Authority, Mortgage Purchase 6.875%, 11/15/2023............... 14,000,000 14,515,760
Skowhegan, SWDR (S.D. Warren Co. Project) 8.40%, 10/1/2015.................. 7,700,000 8,761,368
MARYLAND-2.4%
Community Development Administration,
Department of Housing and Community Development State of Maryland,
Single Family Program Bonds:
6.80%, 4/1/2024....................................................... 33,915,000 35,082,693
6.55%, 4/1/2026....................................................... 9,260,000 9,471,684
6.75%, 4/1/2026....................................................... 20,000,000 20,723,400
Maryland Health and Higher Educational Facilities Authority, Revenue
(Maryland General Hospital Issue):
6.125%, 7/1/2019 (Insured; MBIA)...................................... 1,815,000 1,909,961
6.20%, 7/1/2024 (Insured; MBIA)....................................... 4,000,000 4,232,760
Northeast Waste Disposal Authority, Solid Waste Revenue
(Montgomery County Resource Recovery Project) 6.30%, 7/1/2016........... 15,000,000 15,659,850
MASSACHUSETTS-2.2%
Massachusetts Housing Finance Agency, Revenue:
Housing:
6.65%, 7/1/2019 (Insured; AMBAC)...................................... 7,275,000 7,686,328
6.50%, 7/1/2025 (Insured; AMBAC)...................................... 4,140,000 4,304,648
6.60%, 1/1/2037 (Insured; AMBAC)...................................... 7,100,000 7,351,482
Single Family Housing:
6.60%, 12/1/2024...................................................... 19,550,000 20,015,290
7.125%, 6/1/2025...................................................... 26,975,000 28,440,012
6.65%, 12/1/2027...................................................... 7,200,000 7,400,088
DREYFUS MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) FEBRUARY 29, 1996 (UNAUDITED)
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
________ ________
MASSACHUSETTS (CONTINUED)
Massachusetts Industrial Finance Agency, Revenue Museum
(Norman Rockwell Stockbridge) 8.125%, 7/1/2011.......................... $ 3,160,000 $3,368,149
MICHIGAN-2.7%
Charter County of Wayne, Special Airport Facilities Revenue, Refunding
(Northwest Airlines, Inc., Facilities) 6.75%, 12/1/2015................. 8,800,000 8,987,176
Detroit, Sewage Disposal System Revenue 5.25%, 7/1/2015 (Insured; MBIA)..... 8,700,000 8,427,255
East Grand Rapids Public School District 5%, 5/1/2020 (c)................... 8,675,000 8,147,734
The Economic Development Corp. of the County of Gratiot,
Limited Obligation EDR (Danly Die Set Project)
7.625%, 4/1/2007........................................................ 3,200,000 3,388,960
Michigan Hospital Finance Authority, Revenue:
Hospital Refunding:
(Genesys Health System Obligated Group):
8.125%, 10/1/2021................................................. 15,000,000 16,624,200
7.50%, 10/1/2027.................................................. 15,300,000 16,126,659
(Henry Ford Health System) 5.25%, 11/15/2025.......................... 10,000,000 9,460,700
(Metropolitan Hospital) 8.125%, 7/1/2018 (Prerefunded 7/1/1999) (a)..... 5,000,000 5,752,600
Western Townships Utilities Authority, Sewer Disposal System (Limited Tax GO):
8.125%, 1/1/2009........................................................ 8,765,000 9,794,011
8.20%, 1/1/2018......................................................... 9,250,000 10,354,358
MINNESOTA-2.1%
Minneapolis, HR, Refunding (Lifespan Inc. Issue)
9.125%, 12/1/2014 (Prerefunded 12/1/1997) (a)........................... 4,000,000 4,447,760
Minnesota Housing Finance Agency, Single Family Mortgage:
6.40%, 7/1/2015......................................................... 6,000,000 6,140,580
6.40%, 7/1/2017......................................................... 8,500,000 8,685,640
6.90%, 7/1/2022......................................................... 7,265,000 7,601,878
6.50%, 7/1/2024......................................................... 15,870,000 16,227,392
6.45%, 7/1/2025......................................................... 30,210,000 30,772,510
MISSOURI-1.0%
Kansas City Municipal Assistance Corp., Leasehold Revenue, Refunding
(H. Roe Bartle Convention Center Project):
5.125%, 4/15/2015 (Insured; MBIA) (c)................................. 10,055,000 9,617,306
5%, 4/15/2020 (Insured; MBIA)......................................... 5,500,000 5,138,155
Missouri Higher Education Loan Authority, Student Loan Revenue
6.75%, 2/15/2009........................................................ 11,500,000 11,785,890
Saint Louis, Airport Revenue, Refunding and Improvement
(Lambert-Saint Louis International Airport Project)
6.125%, 7/1/2015 (Insured; FGIC)........................................ 8,000,000 8,300,320
DREYFUS MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) FEBRUARY 29, 1996 (UNAUDITED)
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
________ ________
MONTANA-.2%
Montana Board of Housing (Single Family Program) 6.35%, 12/1/2021........... $ 7,255,000 $7,356,135
NEVADA-1.5%
Clark County, IDR (Nevada Power Co. Project) 6.70%, 6/1/2022 (Insured; FGIC) (d) 25,895,000 27,865,610
Nevada Housing Division (Single Family Program) 6.80%, 4/1/2027............. 9,960,000 10,326,926
Washoe County:
Gas Facilities Revenue (Sierra Pacific Power Co. Project)
6.70%, 11/1/2032 (Insured; MBIA)...................................... 10,000,000 10,903,600
Gas and Water Facilities Revenue, Refunding (Sierra Pacific)
6.30%, 12/1/2014 (Insured; AMBAC)..................................... 4,375,000 4,685,756
NEW HAMPSHIRE-6.7%
Business Finance Authority of the State of New Hampshire,
State Guaranteed Airport Revenue (Manchester Airport Project):
6.50%, 1/1/2019....................................................... 12,600,000 13,303,962
6.375%, 1/1/2022...................................................... 8,650,000 9,049,284
New Hampshire Higher Educational and Health Facilities Authority, Revenue, Refunding
(Franklin Pierce College Issue) 6%, 10/1/2013........................... 4,655,000 4,582,708
New Hampshire Housing Finance Authority:
Multi-Family Housing:
7.55%, 7/1/2013....................................................... 4,205,000 4,706,572
(Mariners Village Project):
6.50%, 7/1/2026 (Insured; FHA).................................... 3,195,000 3,254,331
6.60%, 1/1/2038 (Insured; FHA).................................... 7,365,000 7,495,361
Single Family Mortgage:
7.25%, 1/1/2016....................................................... 3,695,000 3,872,582
6.05%, 7/1/2025....................................................... 33,495,000 33,515,432
6.55%, 7/1/2026....................................................... 22,415,000 22,896,923
Single Family Residential Mortgage:
6.85%, 7/1/2016....................................................... 7,150,000 7,483,333
5.60%, 7/1/2017....................................................... 6,000,000 5,803,800
7.10%, 1/1/2023....................................................... 25,670,000 27,152,186
7.75%, 7/1/2023....................................................... 17,490,000 18,619,679
6.85%, 1/1/2025....................................................... 10,600,000 10,973,332
6.95%, 1/1/2026....................................................... 10,300,000 10,777,817
New Hampshire Industrial Development Authority, Revenue
(Pollution Control Public Service Co. Project):
7.65%, Series A, 5/1/2021............................................. 27,450,000 29,013,827
7.65%, Series C, 5/1/2021............................................. 23,800,000 25,155,886
NEW JERSEY-4.0%
Howell Township Municipal Utilities Authority, Revenue
8.60%, 1/1/2014 (Prerefunded 7/1/1998) (a).............................. 4,000,000 4,488,160
DREYFUS MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) FEBRUARY 29, 1996 (UNAUDITED)
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
________ ________
NEW JERSEY (CONTINUED)
New Jersey Economic Development Authority, PCR
(Public Service Electric and Gas Co. Project)
6.40%, 5/1/2032 (Insured; MBIA)......................................... $ 32,040,000 $34,221,924
New Jersey Educational Facilities Authority, Revenue:
(Trenton State College Issue):
5.10%, 7/1/2021 (Insured; MBIA)....................................... 11,000,000 10,365,630
5.125%, 7/1/2024 (Insured; MBIA)...................................... 17,000,000 16,123,650
(University of Medicine and Dentistry of New Jersey Issue)
5.25%, 12/1/2021 (Insured; AMBAC)..................................... 15,000,000 14,455,500
New Jersey Health Care Facilities Financing Authority, Revenue:
(Atlantic City Medical Center)
8.375%, 8/1/2020 (Insured; FHA) (Prerefunded 2/1/1998) (a)............ 8,510,000 9,398,189
(Newton Memorial Hospital) 7.50%, 7/1/2019.............................. 5,000,000 5,284,350
New Jersey Housing and Mortgage Finance Agency, Revenue:
6%, 11/1/2002........................................................... 5,440,000 5,660,483
6.20%, 11/1/2004........................................................ 9,300,000 9,776,067
6.45%, 11/1/2007........................................................ 15,260,000 16,107,846
New Jersey Wastewater Treatment Trust, Insured Loan Revenue
9%, 9/1/2007 (Prerefunded 9/1/1997) (a)................................. 6,000,000 6,593,760
Passaic County Utilities Authority, Solid Waste System Revenue 7%, 11/15/2007 2,500,000 2,492,125
Pollution Control Financing Authority of Salem County, PCR, Refunding
(Public Service Electric and Gas Co. Project)
6.25%, 6/1/2031 (Insured; MBIA)......................................... 6,500,000 6,943,300
NEW MEXICO-.9%
Albuquerque, HR, Refunding (Presbyterian Health Care Services)
6.375%, 8/1/2007 (Insured; MBIA)........................................ 4,500,000 4,949,955
New Mexico Educational Assistance Foundation, Student Loan Revenue
7.45%, 3/1/2010......................................................... 12,045,000 12,216,280
New Mexico Mortgage Financing Authority:
6.85%, 7/1/2015......................................................... 5,100,000 5,431,194
6.75%, 7/1/2025......................................................... 2,250,000 2,455,245
6.80%, 1/1/2026......................................................... 5,500,000 6,002,920
NEW YORK-6.6%
New York City:
8%, 6/1/1996............................................................ 2,355,000 2,382,106
7.50%, 2/1/2003......................................................... 9,000,000 9,977,400
8.25%, 6/1/2006......................................................... 2,750,000 3,352,140
7.25%, 8/15/2007........................................................ 6,790,000 7,709,570
6.375%, 8/15/2011....................................................... 31,285,000 31,986,097
6%, 2/15/2025........................................................... 51,275,000 49,734,186
DREYFUS MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) FEBRUARY 29, 1996 (UNAUDITED)
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
________ ________
NEW YORK (CONTINUED)
New York City Industrial Development Agency, Special Facilities Revenue
(1994 American Airlines, Inc. Project) 6.90%, 8/1/2024.................. $ 6,000,000 $ 6,495,840
New York State Dormitory Authority, Revenue:
City University 7.50%, 7/1/2010......................................... 10,000,000 11,835,200
(Department of Health of the State of New York) 5.50%, 7/1/2025......... 9,000,000 8,481,960
New York State Energy, Research and Development Authority,
Electric Facilities Revenue:
(Con Edison Co. Project) 7.50%, 1/1/2026.............................. 23,970,000 26,182,910
(Long Island Lighting):
7.15%, 9/1/2019................................................... 4,000,000 4,147,040
7.15%, 6/1/2020................................................... 3,000,000 3,110,280
7.15%, 12/1/2020.................................................. 8,810,000 9,133,856
7.15%, 2/1/2022................................................... 13,000,000 13,477,880
New York State Mortgage Agency, Revenue (Homeowner Mortgage)
6.65%, 10/1/2025........................................................ 17,215,000 18,067,487
New York State Urban Development Corp., Revenue (Correctional Capital Facilities)
5.375%, 1/1/2025........................................................ 33,000,000 30,717,390
NORTH CAROLINA-.9%
North Carolina Housing Finance Agency, Single Family Revenue 6.50%, 9/1/2026 6,125,000 6,260,179
North Carolina Medical Care Commission, HR:
(Duke University Hospital Project) 7%, 6/1/2021 (Prerefunded 6/1/2001) (a) 2,000,000 2,295,660
(Gaston Memorial Hospital Project) 5.50%, 2/15/2015..................... 3,380,000 3,331,024
Pitt County, Revenue (Pitt County Memorial Hospital)
6.90%, 12/1/2021 (Prerefunded 12/1/2001) (a)............................ 12,000,000 13,789,200
Winston Salem, COP 6.90%, 6/1/2011 (Prerefunded 6/1/2001) (a)............... 5,245,000 5,974,475
NORTH DAKOTA-.3%
North Dakota Housing Finance Agency:
(Housing Mortgage Finance Program) 6.75%, 7/1/2025...................... 6,470,000 6,683,057
SFMR 6.80%, 7/1/2023.................................................... 3,280,000 3,416,874
OHIO-.6%
Cuyahoga County, HR (Meridia Health System) 7%, 8/15/2023................... 7,000,000 7,602,070
Hamilton County, Hospital Facilities Revenue, Refunding (Bethesda Hospital)
6.25%, 1/1/2012......................................................... 3,115,000 3,240,036
Ohio Air Quality Development Authority, PCR (Ohio Edison)
5.625%, 11/15/2029 (Insured; AMBAC)..................................... 12,000,000 11,944,920
OKLAHOMA-1.2%
Claremore Industrial and Redevelopment Authority, EDR (Yuba Project)
8.375%, 7/1/2011........................................................ 7,500,000 8,043,300
DREYFUS MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) FEBRUARY 29, 1996 (UNAUDITED)
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
________ ________
OKLAHOMA (CONTINUED)
Southern Oklahoma Memorial Hospital Authority, HR 6.60%, 12/1/2012.......... $5,725,000 $6,021,269
Tulsa Municipal Airport Trust, Revenue:
(AMR Corp.) 7.60%, 12/1/2030............................................ 14,390,000 15,719,060
(American Airlines) 7.375%, 12/1/2020................................... 13,000,000 13,960,960
PENNSYLVANIA-2.8%
Allegheny County Hospital Development Authority, Revenue (Health Center-University
of Pittsburgh Medical Center System) 5.375%, 12/1/2025 (Insured; MBIA).. 27,555,000 26,409,539
Delaware County Industrial Development Authority, Water Facilities Revenue
(Philadelphia Suburban Water) 6.35%, 8/15/2025 (Insured; FGIC).......... 10,000,000 10,614,800
Lehigh County Industrial Development Authority, PCR, Refunding
(Pennsylvania Power and Light Co. Project) 5.50%, 2/15/2027 (Insured; MBIA) 8,805,000 8,581,265
Pennsylvania:
5%, 11/15/2014 (Insured; AMBAC)......................................... 8,875,000 8,444,385
5%, 11/15/2015 (Insured; AMBAC)......................................... 8,875,000 8,380,041
Pennsylvania Economic Development Financing Authority, Exempt Facilities Revenue
(MacMillan Ltd. Partnership Project) 7.60%, 12/1/2020................... 4,500,000 5,079,420
Philadelphia:
5%, 5/15/2020 (Insured; MBIA)........................................... 7,650,000 7,107,080
Water and Wastewater Revenue, Refunding 5.25%, 6/15/2023 (Insured; MBIA) 6,000,000 5,687,460
Quakertown General Authority, Revenue (Community Mental Health/Retardation):
8.75%, 11/1/2000........................................................ 1,495,000 1,640,598
8.875%, 11/1/2010....................................................... 6,420,000 7,088,771
Ridley Park Hospital Authority, Revenue (Taylor Hospital)
8.625%, 12/1/2020 (Prerefunded 12/1/2000) (a)........................... 10,000,000 12,043,000
RHODE ISLAND-1.6%
Rhode Island Health and Educational Building Corp., Revenue:
(Johnson and Wales University) 8.375%, 4/1/2020 (Prerefunded 4/1/2000) (a) 11,000,000 12,921,260
(Landmark Medical Center) 5.60%, 10/1/2012.............................. 5,000,000 4,943,350
Rhode Island Housing and Mortgage Finance Corp. (Homeownership Opportunity):
6.95%, 4/1/2022......................................................... 9,250,000 9,666,713
6.60%, 10/1/2025........................................................ 10,270,000 10,636,844
6.50%, 4/1/2027......................................................... 11,835,000 12,170,877
6.85%, 4/1/2027......................................................... 5,660,000 5,956,754
Rhode Island Student Loan Authority, Student Loan Program Revenue
6.45%, 12/1/2015........................................................ 2,320,000 2,347,353
SOUTH CAROLINA-1.1%
Richland County, Solid Waste Disposal Facilities Revenue (Union Camp Corp. Project)
7.125%, 9/1/2021........................................................ 6,250,000 6,832,000
DREYFUS MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) FEBRUARY 29, 1996 (UNAUDITED)
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
________ ________
SOUTH CAROLINA (CONTINUED)
South Carolina Housing Finance and Development Authority, Mortgage Revenue:
6.55%, 7/1/2015......................................................... $ 3,950,000 $4,075,373
6.65%, 7/1/2019......................................................... 3,500,000 3,602,060
6.75%, 7/1/2026......................................................... 7,000,000 7,246,680
6.70%, 7/1/2027......................................................... 8,000,000 8,264,880
Spartanburg County, Hospital Facilities Improvement Revenue, Refunding
(Mary Black Memorial Project) 8.25%, 10/1/2008 (Prerefunded 10/1/1998) (a) 5,000,000 5,599,750
York County, Industrial Revenue, Exempt Facility (Hoechst Celanese)
5.70%, 1/1/2024......................................................... 5,000,000 4,843,750
TENNESSEE-2.0%
Humphreys County Industrial Development Board, SWDR
(Du Pont (E.I.) de Nemours and Co. Project) 6.70%, 5/1/2024............. 21,070,000 22,868,535
Tennessee Housing Development Agency, Mortgage Finance:
6.45%, 7/1/2021......................................................... 11,565,000 11,787,279
6.90%, 7/1/2025......................................................... 4,150,000 4,339,821
6.55%, 7/1/2026......................................................... 31,735,000 32,470,935
TEXAS-5.4%
Alliance Airport Authority Inc., Special Facilities Revenue (American Airlines, Inc. Project):
7%, 12/1/2011........................................................... 12,330,000 13,540,559
7.50%, 12/1/2029........................................................ 25,905,000 28,036,463
Angelina and Neches River Authority, SWDR (Champion International Corp. Project)
7.375%, 5/1/2015........................................................ 5,570,000 6,060,996
Austin, Airport System Prior Lien Revenue 6.125%, 11/15/2025 (Insured; MBIA) 15,250,000 15,962,785
Bexar Metropolitan Water District, Waterworks System Revenue
6.35%, 5/1/2025 (Insured; MBIA)......................................... 3,200,000 3,453,632
Gulf Coast Waste Disposal Authority, Revenue:
(Champion International Corp.):
7.375%, 10/1/2025..................................................... 12,000,000 12,987,360
6.875%, 12/1/2028..................................................... 6,000,000 6,350,940
Solid Waste Disposal (Occidental Petroleum Corp. Project) 7%, 11/1/2020. 7,725,000 8,102,212
Harris County Hospital District, Mortgage Revenue, Refunding
7.40%, 2/15/2010 (Insured; AMBAC)....................................... 5,000,000 6,152,600
Houston, Water and Sewer System Revenue, Refunding
Zero Coupon, 12/1/2011 (Insured; AMBAC)................................. 45,960,000 19,339,968
Houston Hotel Occupancy Tax, Revenue
7%, 7/1/2009 (Insured; FGIC) (Prerefunded 7/1/2001) (a)................. 12,225,000 13,821,096
Rio Grande Valley Health Facilities Development Corp., HR, Refunding
(Valley Baptist Medical Center Project) 6.40%, 8/1/2016................. 11,200,000 12,006,848
DREYFUS MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) FEBRUARY 29, 1996 (UNAUDITED)
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
________ ________
TEXAS (CONTINUED)
Texas, GO (Veterans Housing Assistance Program) 7%, 12/1/2025............... $10,195,000 $10,761,434
Texas Higher Education Coordinating Board,
College Student Loan Revenue (Senior Lien):
7.45%, 10/1/2006...................................................... 3,910,000 3,956,920
Zero Coupon, 10/1/2025................................................ 3,010,000 1,959,901
7.70%, 10/1/2025...................................................... 2,630,000 2,661,876
Texas Municipal Power Agency, Revenue, Refunding
Zero Coupon, 9/1/2016 (Insured; MBIA)................................... 32,095,000 10,198,186
Texas Public Property Finance Corp., Revenue
(Mental Health and Retardation Project):
8.625%, 11/1/2000..................................................... 1,700,000 1,879,979
8.75%, 11/1/2010...................................................... 4,745,000 5,428,944
Texas Turnpike Authority, Dallas North Thruway Revenue
(President George Bush Turnpike) 5.25%, 1/1/2023 (Insured; FGIC)........ 12,000,000 11,443,440
UTAH-1.9%
Carbon County, SWDR, Refunding (Sunnyside Cogeneration) 9.25%, 7/1/2018..... 20,000,000 21,936,600
Intermountain Power Agency, Power Supply Revenue, Refunding 5%, 7/1/2021.... 10,000,000 9,131,700
Utah Housing Finance Agency, Single Family Mortgage:
6.55%, 1/1/2022......................................................... 5,340,000 5,451,553
6.65%, 7/1/2026......................................................... 3,600,000 3,703,176
6.40%, 1/1/2027......................................................... 6,750,000 6,887,363
6.45%, 7/1/2027......................................................... 2,500,000 2,536,950
6.65%, 7/1/2027......................................................... 10,340,000 10,645,857
7%, 7/1/2027............................................................ 5,230,000 5,522,775
Utah Municipal Finance Cooperative, Local Government Revenue
(Pooled Capital-Salt Lake):
Zero Coupon, 3/1/2013 (Insured; FSA).................................. 3,690,000 1,402,569
Zero Coupon, 3/1/2014 (Insured; FSA).................................. 3,190,000 1,145,465
Zero Coupon, 3/1/2015 (Insured; FSA).................................. 3,540,000 1,200,839
VERMONT-.3%
Vermont Housing Finance Agency, Single Family Housing 6.875%, 5/1/2025...... 10,500,000 10,870,125
VIRGINIA-2.3%
Giles County Industrial Development Authority, Solid Waste Disposal Facility Revenue
(Hoechst Celanese Corp. Project) 6.625%, 12/1/2022...................... 8,715,000 9,132,100
Henrico County Industrial Development Authority, Revenue (Maryview Hospital Project)
7.50%, 9/1/2011 (Prerefunded 8/1/2000) (a).............................. 5,355,000 6,159,696
Virginia Housing Development Authority, Commonwealth Mortgage:
6.55%, 7/1/2017......................................................... 3,935,000 4,011,654
6.60%, 7/1/2020......................................................... 3,025,000 3,088,253
DREYFUS MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) FEBRUARY 29, 1996 (UNAUDITED)
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
________ ________
VIRGINIA (CONTINUED)
Virginia Housing Development Authority, Commonwealth Mortgage (continued):
6.20%, 7/1/2021......................................................... $15,000,000 $15,026,100
6.70%, 1/1/2022......................................................... 6,950,000 7,159,682
6.40%, 7/1/2022 (Insured; MBIA)......................................... 24,000,000 24,679,920
6.60%, 7/1/2022......................................................... 4,635,000 4,724,502
6.85%, 1/1/2027......................................................... 8,000,000 8,263,040
WASHINGTON-1.0%
Pilchuck Development Public Corp., Revenue, Special Facilities Airport
(Tramco Inc. Project) 6%, 8/1/2023...................................... 5,150,000 4,950,489
Public Utility District No. 1 of Chelan County,
Chelan Hydro Consolidated System Revenue 6.55%, 7/1/2023................ 10,000,000 10,522,900
Public Utility District No. 1 of Douglas County, Wells Hydroelectric Revenue:
6.15%, 9/1/2013......................................................... 2,000,000 2,054,260
6.20%, 9/1/2018......................................................... 3,000,000 3,112,260
Puyallup School District No. 3, Pierce County
6.65%, 12/1/2007 (Insured; AMBAC) (Prerefunded 12/1/2002) (a)........... 2,000,000 2,267,840
Snohomish County School District No. 6, Mukilteo 6.50%, 12/1/2011........... 7,700,000 8,590,197
Washington Health Care Facilities Authority, Revenue
(Harrison Memorial Hospital, Bremerton) 5.30%, 8/15/2014 (Insured; AMBAC) 5,000,000 4,787,050
WEST VIRGINIA-.2%
Braxton County, SWDR (Weyerhaeuser Co. Project) 6.50%, 4/1/2025............. 8,000,000 8,376,080
WISCONSIN-2.1%
Madison, IDR (Madison Gas and Electric Co. Project) 6.75%, 4/1/2027......... 10,000,000 10,696,500
Wisconsin Health and Educational Facilities Authority, Revenue:
(Aurora Health Care) 5.25%, 8/15/2023 (Insured; MBIA)................... 15,000,000 13,995,600
(Waukesha Memorial Hospital, Inc.) 5.50%, 8/15/2015 (Insured; AMBAC).... 8,545,000 8,369,913
Wisconsin Housing and Economic Development Authority, Homeownership Revenue:
6.45%, 3/1/2017......................................................... 7,000,000 7,207,830
6.30%, 3/1/2026......................................................... 30,750,000 30,887,760
Wisconsin Municipal Mutual Insurance Co., Revenue
8.50%, 12/1/2007 (LOC; Fuji Bank) (b)................................... 2,500,000 2,711,950
WYOMING-1.0%
Sweetwater County, SWDR (FMC Corp. Project):
7%, 6/1/2024............................................................ 9,805,000 10,361,924
6.90%, 9/1/2024......................................................... 16,225,000 17,105,044
Uinta County Hospital Facility, Revenue, Refunding (IHC Hospitals Inc.)
7.25%, 2/15/2019 (Prerefunded 2/15/1999) (a)............................ 7,350,000 7,932,047
DREYFUS MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) FEBRUARY 29, 1996 (UNAUDITED)
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
________ ________
U.S. RELATED-.2%
Commonwealth of Puerto Rico, 5.85%, 7/1/2010................................ $ 5,725,000 $5,870,530
_________
TOTAL LONG-TERM MUNICIPAL INVESTMENTS
(cost $3,322,998,809)................................................... $3,485,673,448
==============
SHORT-TERM MUNICIPAL INVESTMENTS-2.5%
FLORIDA-.1%
Florida Board of Education, Capital Outlay 3.93% (e,f)...................... 3,000,000 3,000,000
MARYLAND-.0%
Frederick, VRDN 3.40% (LOC; The Fuji Bank and Trust Co.) (b,g).............. 300,000 300,000
MASSACHUSETTS-.2%
Massachusetts, VRDN 3.35% (LOC; National Westminster Bank PLC) (b,g)........ 6,000,000 6,000,000
Massachusetts Health and Education Facilities Authority, Revenue, VRDN (Saint Elizabeth)
3.50% (Insured; FSA) (g)................................................ 2,000,000 2,000,000
MICHIGAN-.4%
Michigan Stategic Fund, PCR, VRDN (Consumers Power Project)
3.35% (LOC; Union Bank of Switzerland) (b,g)............................ 16,000,000 16,000,000
MISSOURI-.2%
Health and Education Facilities Authority of the State of Missouri,
Educational Facilities Revenue, VRDN (Washington University) 3.25% (g).. 7,000,000 7,000,000
NEW JERSEY-.1%
New Jersey Sports and Exposition Authority VRDN 3.10% (Insured; MBIA) (g)... 4,900,000 4,900,000
NEW YORK-.1%
New York City, VRDN 3.45% (LOC; Sumitomo Bank, Ltd.) (b,g).................. 2,000,000 2,000,000
OHIO-.6%
Columbus, Electric System Revenue, VRDN 3.35% (LOC; Dai-Ichi Kanyo Bank) (b,g) 16,200,000 16,200,000
Cuyahoga County, HR, VRDN (University Hospital Cleveland)
3.40% (LOC; Dai-Ichi Kangyo Bank) (b,g)................................. 4,000,000 4,000,000
SOUTH CAROLINA-.2%
South Carolina Jobs-Economic Development Authority, EDR, VRDN
(Saint Francis Hospital) 3.40% (LOC; Chemical Bank) (b,g)............... 5,700,000 5,700,000
TEXAS-.6%
Gulf Coast Waste Disposal Authority, PCR, VRDN:
(Amoco Oil Co. Project) 3.35% (g)....................................... 9,000,000 9,000,000
(Exxon Project) 3.35% (g)............................................... 10,400,000 10,400,000
DREYFUS MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) FEBRUARY 29, 1996 (UNAUDITED)
PRINCIPAL
SHORT-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
________ ________
TEXAS (CONTINUED)
Harris County Health Facilities Development Corp., HR, VRDN (Methodist Hospital)
3.45% (g)............................................................... $ 3,600,000 $3,600,000
__________
TOTAL SHORT-TERM MUNICIPAL INVESTMENTS
(cost $90,100,000)...................................................... $90,100,000
============
TOTAL INVESTMENTS-100.0%
(cost $3,413,098,809)................................................... $3,575,773,448
============
</TABLE>
<TABLE>
<CAPTION>
DREYFUS MUNICIPAL BOND FUND, INC.
SUMMARY OF ABBREVIATIONS
<S> <C> <S> <C>
AMBAC American Municipal Bond Assurance Corporation LR Lease Revenue
CGIC Capital Guaranty Insurance Company LOC Letter of Credit
COP Certificate of Participation MBIA Municipal Bond Investors Assurance
EDR Economic Development Revenue Insurance Corporation
FGIC Financial Guaranty Insurance Company PCR Pollution Control Revenue
FHA Federal Housing Administration RRR Resources Recovery Revenue
FSA Financial Security Assurance SFMR Single Family Mortgage Revenue
GO General Obligation SWDR Solid Waste Disposal Revenue
HR Hospital Revenue VRDN Variable Rate Demand Notes
IDR Industrial Development Revenue
</TABLE>
<TABLE>
<CAPTION>
SUMMARY OF COMBINED RATINGS (UNAUDITED)
FITCH (H) OR MOODY'S OR STANDARD & POOR'S PERCENTAGE OF VALUE
_____ ________ ___________________ _____________________
<S> <C> <C> <C>
AAA Aaa AAA 28.5%
AA Aa AA 27.9
A A A 17.9
BBB Baa BBB 14.2
BB Ba BB 3.1
F1 MIG1/P1 SP1/A1 2.1
Not Rated (i) Not Rated (i) Not Rated (i) 6.3
____
100.0%
======
</TABLE>
NOTES TO STATEMENT OF INVESTMENTS:
(a) Bonds which are prerefunded are collateralized by U.S. Government
securities which are held in escrow and are used to pay principal and
interest on the municipal issue and to retire the bonds in full at the
earliest refunding date.
(b) Secured by letters of credit.
(c) Purchased on a delayed delivery basis.
(d) Partially held by custodian as collateral for delayed delivery
security.
(e) Inverse Floater Security - the interest rate is subject to change
periodically.
(f) Security exempt from registration under Rule 144A of the Securities
Act of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At February 29,
1996, this security amounted to $3,000,000 or .1% of net assets.
(g) Securities payable on demand. The interest rate, which is subject to
change, is based upon bank prime rates or an index of market interest
rates.
(h) Fitch currently provides creditworthiness information for a limited
number of investments.
(i) Securities which, while not rated by Fitch, Moody's or Standard &
Poor's have been determined by the Manager to be of comparable quality to
those rated securities in which the Fund may invest.
(j) At February 29, 1996, the Fund had $961,235,258 (25.9% of net
assets) invested in securities whose payment of principal and interest is
dependent upon revenues generated from housing projects.
See independent accountants' review report and notes to financial statements.
<TABLE>
<CAPTION>
DREYFUS MUNICIPAL BOND FUND, INC.
STATEMENT OF ASSETS AND LIABILITIES FEBRUARY 29, 1996 (UNAUDITED)
<S> <C> <C>
ASSETS:
Investments in securities, at value
(cost $3,413,098,809)-see statement................................... $3,575,773,448
Cash.................................................................... 99,093,147
Interest receivable..................................................... 53,655,582
Receivable for subscriptions to Common Stock sold....................... 12,290
Prepaid expenses........................................................ 63,834
_____________
3,728,598,301
LIABILITIES:
Due to The Dreyfus Corporation and subsidiaries......................... $1,892,255
Payable for investment securities purchased............................. 9,221,523
Payable for Common Stock redeemed....................................... 125,966
Accrued expenses........................................................ 479,245 11,718,989
________ __________
NET ASSETS.................................................................. $3,716,879,312
==============
REPRESENTED BY:
Paid-in capital......................................................... $3,563,501,817
Accumulated net realized (loss) on investments.......................... (9,297,144)
Accumulated net unrealized appreciation on investments-Note 3(b)........ 162,674,639
_____________
NET ASSETS at value applicable to 295,569,740 outstanding shares of
Common Stock, equivalent to $12.58 per share
(600 million shares of $.01 par value authorized)....................... $3,716,879,312
==============
See independent accountants' review report and notes to financial statements.
DREYFUS MUNICIPAL BOND FUND, INC.
STATEMENT OF OPERATIONS SIX MONTHS ENDED FEBRUARY 29, 1996 (UNAUDITED)
INVESTMENT INCOME:
INTEREST INCOME......................................................... $120,440,176
EXPENSES:
Management fee-Note 2(a).............................................. $11,353,556
Shareholder servicing costs-Note 2(b)................................. 1,550,993
Custodian fees........................................................ 115,163
Prospectus and shareholders' reports.................................. 88,179
Directors' fees and expenses-Note 2(c)................................ 39,280
Registration fees..................................................... 33,052
Auditing fees......................................................... 31,808
Legal fees............................................................ 25,153
Miscellaneous......................................................... 60,117
________
TOTAL EXPENSES.................................................. 13,297,301
___________
INVESTMENT INCOME-NET........................................... 107,142,875
___________
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain on investments-Note 3(a).............................. $35,219,039
Net realized (loss) on financial futures-Note 3(a)...................... (160,399)
_____________
NET REALIZED GAIN..................................................... 35,058,640
Net unrealized appreciation on investments.............................. 20,616,704
___________
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS................. 55,675,344
___________
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........................ $162,818,219
=============
See independent accountants' review report and notes to financial statements.
DREYFUS MUNICIPAL BOND FUND, INC.
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED SIX MONTHS ENDED
AUGUST 31, FEBRUARY 29, 1996
1995 (UNAUDITED)
________________ _______________
OPERATIONS:
Investment income-net............................................. $223,098,936 $ 107,142,875
Net realized gain (loss) on investments........................... (44,338,112) 35,058,640
Net unrealized appreciation on investments for the period......... 78,567,175 20,616,704
________________ _______________
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS............ 257,327,999 162,818,219
________________ _______________
DIVIDENDS TO SHAREHOLDERS FROM:
Investment income-net............................................. (223,098,936) (107,142,875)
Net realized gain on investments.................................. (22,638,307) __
________________ _______________
TOTAL DIVIDENDS................................................. (245,737,243) (107,142,875)
________________ _______________
CAPITAL STOCK TRANSACTIONS:
Net proceeds from shares sold..................................... 4,846,241,789 2,553,610,969
Dividends reinvested.............................................. 155,978,774 66,655,946
Cost of shares redeemed........................................... (5,085,554,561) (2,895,796,814)
________________ _______________
(DECREASE) IN NET ASSETS FROM CAPITAL STOCK TRANSACTIONS........ (83,333,998) (275,529,899)
________________ _______________
TOTAL (DECREASE) IN NET ASSETS.............................. (71,743,242) (219,854,555)
NET ASSETS:
Beginning of period............................................... 4,008,477,109 3,936,733,867
_______________ _______________
End of period..................................................... $ 3,936,733,867 $ 3,716,879,312
=============== ================
SHARES SHARES
_______________ _______________
CAPITAL SHARE TRANSACTIONS:
Shares sold....................................................... 400,686,274 203,155,019
Shares issued for dividends reinvested............................ 12,969,173 5,295,091
Shares redeemed................................................... (419,990,511) (230,103,256)
_______________ _______________
NET (DECREASE) IN SHARES OUTSTANDING............................ (6,335,064) (21,653,146)
=============== ================
See independent accountants' review report and notes to financial statements.
</TABLE>
<TABLE>
<CAPTION>
DREYFUS MUNICIPAL BOND FUND, INC.
FINANCIAL HIGHLIGHTS
Contained below is per share operating performance data for a share of
Common Stock outstanding, total investment return, ratios to average net
assets and other supplemental data for each period indicated. This
information has been derived from the Fund's financial statements.
SIX MONTHS ENDED
YEAR ENDED AUGUST 31, FEBRUARY 29, 1996
_________________________________________________________
PER SHARE DATA: 1991 1992 1993 1994 1995 (UNAUDITED)
______ ______ ______ ______ _______ ____________
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period... $12.24 $12.68 $13.17 $13.68 $12.39 $12.41
______ ______ ______ ______ _______ _______
INVESTMENT OPERATIONS:
Investment income-net................. .87 .84 .79 .75 .72 .35
Net realized and unrealized gain (loss)
on investments...................... .44 .49 .79 (.96) .09 .17
______ ______ ______ ______ _______ _______
TOTAL FROM INVESTMENT OPERATIONS.... 1.31 1.33 1.58 (.21) .81 .52
______ ______ ______ ______ _______ _______
DISTRIBUTIONS:
Dividends from investment income-net.. (.87) (.84) (.79) (.75) (.72) (.35)
Dividends from net realized gain
on investments...................... - - (.28) (.33) (.07) -
______ ______ ______ ______ _______ _______
TOTAL DISTRIBUTIONS................. (.87) (.84) (1.07) (1.08) (.79) (.35)
______ ______ ______ ______ _______ _______
Net asset value, end of period........ $12.68 $13.17 $13.68 $12.39 $12.41 $12.58
====== ======== ======= ======= ======= =======
TOTAL INVESTMENT RETURN................... 11.11% 10.82% 12.62% (1.63%) 6.93% 8.44%(1)
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets .67% .68% .69% .68% .70% .69%(1)
Ratio of net investment income to
average net assets.................. 7.05% 6.49% 5.96% 5.80% 5.94% 5.56%(1)
Portfolio Turnover Rate............... 35.53% 67.86% 45.37% 36.25% 51.55% 22.16%(2)
Net Assets, end of period (000's Omitted) $4,081,440 $4,272,679 $4,724,389 $4,008,477 $3,936,734 $3,716,879
(1) Annualized.
(2) Not annualized.
See independent accountants' review report and notes to financial statements.
</TABLE>
DREYFUS MUNICIPAL BOND FUND, INC.
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES:
Dreyfus Municipal Bond Fund, Inc. (the "Fund") is registered under the
Investment Company Act of 1940 ("Act") as a diversified open-end management
investment company. The Fund's investment objective is to provide investors
with as high a level of current income exempt from Federal income tax as is
consistent with the preservation of capital. The Dreyfus Corporation
("Manager") serves as the Fund's investment adviser. The Manager is a direct
subsidiary of Mellon Bank, N.A. Premier Mutual Fund Services, Inc. (the
"Distributor") acts as the distributor of the Fund's shares, which are sold
to the public without a sales charge.
(A) PORTFOLIO VALUATION: The Fund's investments are valued each business
day by an independent pricing service ("Service") approved by the Board of
Directors. Investments for which quoted bid prices are readily available and
are representative of the bid side of the market in the judgment of the
Service are valued at the mean between the quoted bid prices (as obtained by
the Service from dealers in such securities) and asked prices (as calculated
by the Service based upon its evaluation of the market for such securities).
Other investments (which constitute a majority of the portfolio securities)
are carried at fair value as determined by the Service based on methods which
include consideration of: yields or prices of municipal securities of
comparable quality, coupon, maturity and type; indications as to values from
dealers; and general market conditions.
(B) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities
transactions are recorded on a trade date basis. Realized gain and loss from
securities transactions are recorded on the identified cost basis. Interest
income, adjusted for amortization of premiums and original issue discounts on
investments, is earned from settlement date and recognized on the accrual
basis. Securities purchased or sold on a when-issued or delayed-delivery
basis may be settled a month or more after the trade date.
(C) DIVIDENDS TO SHAREHOLDERS: It is the policy of the Fund to declare
dividends daily from investment income-net. Such dividends are paid monthly.
Dividends from net realized capital gain are normally declared and paid
annually, but the Fund may make distributions on a more frequent basis to
comply with the distribution requirements of the Internal Revenue Code. To
the extent that net realized capital gain can be offset by capital loss
carryovers, it is the policy of the Fund not to distribute such gain.
(D) FEDERAL INCOME TAXES: It is the policy of the Fund to continue to
qualify as a regulated investment company, which can distribute tax exempt
dividends, by complying with the applicable provisions of the Internal
Revenue Code, and to make distributions of income and net realized capital
gain sufficient to relieve it from substantially all Federal income and
excise taxes.
The Fund has an unused capital loss carryover of approximately
$15,947,000 available for Federal income tax purposes to be applied against
future net securities profits, if any, realized subsequent to August 31,
1995. The carryover does not include net realized securities losses from
November 1, 1994 through August 31, 1995 which are treated for Federal income
tax purpose, as arising in fiscal 1996. If not applied, the carryover expires
in fiscal 2003.
NOTE 2-MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES:
(A) Pursuant to a management agreement ("Agreement") with the Manager,
the management fee is computed at the annual rate of .60 of 1% of the value
of the Fund's average daily net assets and is payable monthly. However,
pursuant to the court approved settlement of previously disclosed litigation,
commencing October 15, 1988, the Manager has agreed to make payments to the
Fund for ten years,
DREYFUS MUNICIPAL BOND FUND, INC.
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
ranging from $0 to $1 million per year depending upon average daily net
assets of the Fund. The management fee for the six months ended February 29,
1996 was reduced by $175,000 pursuant to the settlement of litigation.
The Agreement provides for an expense reimbursement from the Manager
should the Fund's aggregate expenses, exclusive of taxes, brokerage, interest
on borrowings and extraordinary expenses, exceed 1 1/2% of the average value
of the Fund's net assets for any full fiscal year. No expense reimbursement
was required for the six months ended February 29, 1996.
(B) Pursuant to the Fund's Shareholder Services Plan, the Fund reimburses
Dreyfus Service Corporation, a wholly-owned subsidiary of the Manager, an
amount not to exceed an annual rate of .25 of 1% of the value of the Fund's
average daily net assets for certain allocated expenses of providing personal
services and/or maintaining shareholder accounts. The services provided may
include personal services relating to shareholder accounts, such as answering
shareholder inquiries regarding the Fund and providing reports and other
information, and services related to the maintenance of shareholder accounts.
During the six months ended February 29, 1996, the Fund was charged an
aggregate of $681,947 pursuant to the Shareholder Services Plan.
Effective December 1, 1995, the Fund compensates Dreyfus Transfer, Inc.,
a wholly-owned subsidiary of the Manager, under a transfer agency agreement
for providing personnel and facilities to perform transfer agency services
for the Fund. Such compensation amounted to $283,604 for the period from
December 1, 1995 through February 29, 1996.
(C) Each director who is not an "affiliated person" as defined in the Act
receives from the Fund an annual fee of $4,500 and an attendance fee of $500
per meeting. The Chairman of the Board receives an additional 25% of such
compensation and the Director Emeritus receives 50% of such compensation.
NOTE 3-SECURITIES TRANSACTIONS:
(A) The aggregate amount of purchases and sales of investment securities,
excluding short-term securities, during the six months ended February 29,
1996 amounted to $800,359,723 and $1,049,659,565, respectively.
The Fund may invest in financial futures contracts in order to gain
exposure to or protect against changes in the market. The Fund is exposed to
market risk as a result of changes in the value of the underlying financial
instruments. Investments in financial futures require the Fund to "mark to
market" on a daily basis, which reflects the change in the market value of
the contract at the close of each day's trading. Typically, variation margin
payments are made or received to reflect daily unrealized gains or losses.
When the contracts are closed, the Fund recognizes a realized gain or loss.
These investments require initial margin deposits with a custodian, which
consist of cash or cash equivalents, up to approximately 10% of the contract
amount. The amount of these deposits is determined by the exchange or Board
of Trade on which the contract is traded and is subject to change. At
February 29, 1996, there were no financial futures contracts outstanding.
(B) At February 29, 1996, accumulated net unrealized appreciation on
investments was $162,674,639, consisting of $171,880,765 gross unrealized
appreciation and $9,206,126 gross unrealized depreciation.
At February 29, 1996, the cost of investments for Federal income tax
purposes was substantially the same as the cost for financial reporting
purposes (see the Statement of Investments).
DREYFUS MUNICIPAL BOND FUND, INC.
REVIEW REPORT OF ERNST & YOUNG LLP, INDEPENDENT ACCOUNTANTS
SHAREHOLDERS AND BOARD OF DIRECTORS
DREYFUS MUNICIPAL BOND FUND, INC.
We have reviewed the accompanying statement of assets and liabilities of
Dreyfus Municipal Bond Fund, Inc., including the statement of investments, as
of February 29, 1996, and the related statements of operations and changes in
net assets and financial highlights for the six month period ended February
29, 1996. These financial statements and financial highlights are the
responsibility of the Fund's management.
We conducted our review in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures
to financial data, and making inquiries of persons responsible for financial
and accounting matters. It is substantially less in scope than an audit
conducted in accordance with generally accepted auditing standards, which
will be performed for the full year with the objective of expressing an
opinion regarding the financial statements and financial highlights taken as
a whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that
should be made to the interim financial statements and financial highlights
referred to above for them to be in conformity with generally accepted
accounting principles.
We have previously audited, in accordance with generally accepted
auditing standards, the statement of changes in net assets for the year ended
August 31, 1995 and financial highlights for each of the five years in the
period ended August 31, 1995 and in our report dated October 4, 1995, we
expressed an unqualified opinion on such statement of changes in net assets
and financial highlights.
[Ernst & Young LLP signature logo]
New York, New York
April 5, 1996
[Dreyfus lion "d" logo]
DREYFUS MUNICIPAL
BOND FUND, INC.
200 Park Avenue
New York, NY 10166
MANAGER
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
CUSTODIAN
The Bank of New York
90 Washington Street
New York, NY 10286
TRANSFER AGENT &
DIVIDEND DISBURSING AGENT
Dreyfus Transfer, Inc.
One American Express Plaza
Providence, RI 02903
Further information is contained
in the Prospectus, which must
precede or accompany this report.
Printed in U.S.A. 054SA962
[Dreyfus logo]
Municipal
Bond Fund, Inc.
Semi-Annual
Report
February 29, 1996
