<PAGE> PAGE 1
000 B000000 10/31/96
000 C000000 0000780113
000 D000000 N
000 E000000 NF
000 F000000 Y
000 G000000 N
000 H000000 N
000 I000000 3.0
000 J000000 A
001 A000000 STATE BOND INCOME FUNDS, INC.
001 B000000 811-4445
001 C000000 5025827900
002 A000000 515 WEST MARKET STREET, 8TH FLOOR
002 B000000 LOUISVILLE
002 C000000 KY
002 D010000 40202
003 000000 N
004 000000 N
005 000000 N
006 000000 N
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007 C020100 STATE BOND U.S.GOVERNMENT & AGENCY SECURITIES
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007 C010700 7
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008 A00AA01 ARM CAPITAL ADVISORS, INC.
008 B00AA01 A
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008 D01AA01 NEW YORK
008 D02AA01 NY
008 D03AA01 10166
011 A00AA01 SBM FINANCIAL SERVICES
011 B00AA01 8-14810
011 C01AA01 NEW ULM
011 C02AA01 MN
011 C03AA01 56073
012 A00AA01 ARM TRANSFER AGENCY, INC.
012 B00AA01 84-5602
012 C01AA01 NEW ULM
012 C02AA01 MN
012 C03AA01 56073
013 A00AA01 ERNST & YOUNG
<PAGE> PAGE 2
013 B01AA01 KANSAS CITY
013 B02AA01 MO
013 B03AA01 64105
014 A00AA01 MORGAN STANLEY AND COMPANY
014 B00AA01 8-15869
015 A00AA01 INVESTORS FIDUCIARY TRUST COMPANY
015 B00AA01 C
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015 C02AA01 MO
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<PAGE> PAGE 3
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<PAGE> PAGE 4
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<PAGE> PAGE 5
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<PAGE> PAGE 6
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<PAGE> PAGE 7
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<PAGE> PAGE 8
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080 C00AA00 1750
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081 B00AA00 5
082 A00AA00 Y
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083 B00AA00 0
084 A00AA00 N
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SIGNATURE KEVIN L. HOWARD
TITLE SECRETARY
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE ANNUAL
REPORT TO SHAREHOLDERS FOR THE STATE BOND U. S. GOVERNMENT AND AGENCY SECURITIES
FUND AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000780113
<NAME> STATE BOND INCOME FUNDS, INC.
<SERIES>
<NUMBER> 1
<NAME> STATE BOND U.S. GOVERNMENT AND AGENCY SECURITIES FUND
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-START> NOV-01-1995
<PERIOD-END> OCT-31-1996
<INVESTMENTS-AT-COST> 13,375,321
<INVESTMENTS-AT-VALUE> 13,282,234
<RECEIVABLES> 87,702
<ASSETS-OTHER> 34,846
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 13,404,782
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 114,151
<TOTAL-LIABILITIES> 114,151
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 13,431,195
<SHARES-COMMON-STOCK> 2,612,700
<SHARES-COMMON-PRIOR> 2,742,371
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<NET-ASSETS> 13,290,631
<DIVIDEND-INCOME> 0
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<EXPENSES-NET> 136,481
<NET-INVESTMENT-INCOME> 838,250
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> (55,907)
<NET-CHANGE-FROM-OPS> 782,343
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 838,250
<DISTRIBUTIONS-OF-GAINS> 0
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<NET-CHANGE-IN-ASSETS> (708,077)
<ACCUMULATED-NII-PRIOR> 0
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<PER-SHARE-NAV-BEGIN> 5.10
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</TABLE>