NEW ENGLAND FUNDS TRUST I
NEW ENGLAND FUNDS TRUST II
Supplement dated October 26, 1995 to New England Bond Funds Prospectus and
New England Strategic Income Fund Prospectus dated May 1, 1995
The following paragraphs are added to the section of the Prospectuses
captioned "Fund Management" for New England Government Securities Fund, New
England Limited Term U.S. Government Fund, New England Adjustable Rate U.S.
Government Fund, New England Strategic Income Fund, New England Bond Income
Fund, New England High Income Fund and New England Tax Exempt Income Fund
(the "Funds"):
The investment adviser of each Fund and the subadviser of New England
Strategic Income Fund are wholly-owned subsidiaries of New England
Investment Companies, L.P. ("NEIC"). New England Mutual Life
Insurance Company ("The New England") owns NEIC's sole general partner
and a majority of the limited partnership interest in NEIC. The New
England and Metropolitan Life Insurance Company ("MetLife") have
entered into an agreement to merge, with MetLife to be the survivor of
the merger. The merger is conditioned upon, among other things,
approval by the policyholders of The New England and MetLife and
receipt of certain regulatory approvals. The merger is not expected
to occur until after December 31, 1995.
The merger of The New England into MetLife is being treated, for
purposes of the Investment Company Act of 1940 (the "Act"), as an
"assignment" of the existing investment advisory agreements relating
to the Funds and the subadvisory agreement relating to New England
Strategic Income Fund. Under the Act, such an "assignment" will
result in the automatic termination of the investment advisory
agreements and the New England Strategic Income Fund subadvisory
agreement, effective at the time of the merger. Prior to the merger,
shareholders of the Funds will be asked to approve new investment
advisory agreements and subadvisory agreements, intended to take
effect at the time of the merger. A proxy statement describing the
new agreements will be sent to shareholders of the Funds prior to
their being asked to vote on the new agreements.
The following paragraphs are added to the section of the Prospectuses
captioned "Buying Fund Shares" for each of the Funds:
Investment checks should be made payable to New England Funds.
New England Funds will accept second-party checks (up to $10,000) for
investments into existing accounts only. (A second-party check is a
check made payable to a New England Funds shareholder which the
shareholder has endorsed to New England Funds for deposit into an
account registered to the shareholder.)
New England Funds will NOT accept third-party checks, except certain
third-party checks issued by other mutual fund companies, broker
dealers or banks representing the transfer of retirement assets. (A
third-party check is a check made payable to a party which is not a
New England Funds shareholder, but which has been ultimately endorsed
to New England Funds for deposit into an account.)
The following financial information supplements the Prospectuses of New England
Strategic
Income Fund:
The Financial Highlights presented below are for a Class A, B and C
share of New England Strategic Income Fund outstanding throughout the
indicated period.
<TABLE>
<CAPTION>
May 1, 1995(a) through
September 30, 1995
Class A Class B Class C
Shares Shares Shares
<S> <C> <C> <C>
Net asset value, beginning of $12.50 $12.50 $12.50
period
Income from investment operations
Net investment income 0.46 0.42 0.41
Net gains or losses on investments
(both realized and unrealized) 0.04 0.04 0.04
Total income from investment 0.50 0.46 0.45
operations
Less distributions
Distributions (from net investment (0.48) (0.44) (0.43)
income)
Total distributions (0.48) (0.44) (0.43)
Net asset value, end of period $12.52 $12.52 $12.52
Total return (%) 4.08(b) 3.76(b) 3.69(b)
Ratios/Supplemental data
Net assets, end of period (000) $29,417 $28,428 $10,575
Ratio of operating expenses to 1.04(c) 1.79(c) 1.79(c)
average net assets (%) (d)
Ratio of net investment income to 7.87(c) 7.12(c) 7.12(c)
average net assets (%)
Portfolio turnover rate (%) 16(c) 16(c) 16(c)
</TABLE>
(a) Commencement of operations.
(b) Not computed on an annualized basis.
(c) Computed on an annualized basis.
(d) The ratio of operating expenses to average net assets (computed on an
annualized basis) without giving effect to the voluntary expense
limitations in effect from May 1, 1995 through September 30, 1995 would
have been 1.69%, 2.44% and 2.44% for Class A, B and C shares,
respectively.
NEW ENGLAND FUNDS TRUST I
New England Tax Exempt Income Fund
Supplement dated July 1, 1995 to New England Bond Funds Prospectus dated
May 1, 1995
The subadvisory relationship between Back Bay Advisors, L.P. and Loomis,
Sayles & Company, L.P. described on page 21 of the Prospectus is no longer
in effect.
SP33-1095
