SEMI-ANNUAL REPORT September 30, 1995
First Financial Fund, Inc.
(LOGO)
<PAGE>
Letter to Shareholders
November 6, 1995
Dear Shareholder:
Lower interest rates, a stable economy and a boom in large bank merger
activity powered bank stocks to record highs for the six months ended September
30. Banks enjoyed the benign concurrence of declining interest rates and low
loan losses while at the same time looking forward to significant deposit
insurance relief. "Bank heaven" may be the most apt characterization for the
year 1995.
Robust profitability and record stock prices, combined with only modest loan
growth, have kept merger activity at a fevered pace, particularly, as of late,
among the nation's largest banks. While the number of merger deals
year-to-date is roughly half that of last year, the value of this year's deals
has already more than tripled that of 1994, with more than 90% of 1995's
transactions valued at $500 million or greater.
Investment Objective
The Fund seeks long-term capital appreciation by investing in a portfolio of
stocks issued by savings and loan companies and banking institutions.
The performance of First Financial Fund and various benchmarks is shown as
follows:
TOTAL RETURN
As of September 30, 1995
<TABLE>
<CAPTION>
3 Mos. 6 Mos. 12 Mos.
<S> <C> <C> <C>
First Financial Fund's (at NAV)* 19.1% 36.5% 35.9%
S&P 500 7.9 18.3 29.7
NASDAQ Composite** 11.8 27.7 36.5
NASDAQ Banks** 13.9 25.9 25.5
SNL Daily** 15.6 30.1 29.5
</TABLE>
* The Fund's total return represents the change in net asset value from the
beginning of the period noted through September 30, 1995 and assumes the
reinvestment of dividends and distributions. Shares of the Fund are traded on
the NYSE. Past performance is no guarantee of future results.
** Principal only.
On September 30, your Fund's shares closed at a market price of $14.625 per
share, which represented a discount of 3.0% to the net asset value of $15.08.
-1-
<PAGE>
Stock Listing
The First Financial Fund, Inc.'s common stock is traded on the New York Stock
Exchange under the symbol "FF" and is frequently listed as "FrstFnl" or
"FstFnlfd" in the financial sections of newspapers. It is also listed in a
closed-end fund table every Monday in The Wall Street Journal.
Strategy
Of our three main thrusts this year, namely, thrift conversions,
California-based thrifts, and consumer finance companies, the finance companies
have fared best. As a result, we have pared our positions mostly in the
finance group but have raised cash across the board as valuations test our
upper limits. The continuation of "bank heaven," that is lower interest rates,
a benign economy and heavy consolidation activity, has made most of our sales
look poorly timed. However, we can only own that for which we have conviction,
and conviction for us is strong prospective fundamentals and low valuation, not
short-term earnings momentum or industry popularity.
Looking Ahead
To improve the outlook for small bank, thrift and consumer finance stocks,
short-term interest rates must continue to fall and the shape of the yield
curve must become more steep. The torrid pace of acquisition activity must
continue as well. We are more convinced of the latter than the former, though
a back-up in interest rates would probably slow merger activity. We think
valuations in our area are high in the absolute, but still reasonable relative
to the market overall. In the current market environment we will reserve some
buying power for a likely pullback in stock prices, and we would describe
ourselves as cautious if not cowardly.
We thank you for the continued interest in the First Financial Fund and we
remain committed to managing the Fund for the benefit of the shareholders.
Sincerely,
Nicholas C. Adams
Portfolio Manager
Wellington Management Company
-2-
<PAGE>
REPORT OF INVESTMENT ADVISER
1995
3
<PAGE>
<PAGE>
- ----------------------------------------------------------
FIRST FINANCIAL FUND, INC.
Portfolio of Investments
September 30, 1995
(Unaudited)
<TABLE>
<CAPTION>
- ---------------------------------------------------------
Value
Shares Description (Note 1)
- ---------------------------------------------------------
<C> <S> <C>
LONG-TERM INVESTMENTS--90.6%
Common Stocks--88.1%
Banks and Thrifts--63.6%
50,000 Avondale Financial Corp.*.... $ 687,500
77,000 Brooklyn Bancorp, Inc.*...... 3,012,625
189,000 Cameron Financial Corp....... 2,693,250
16,000 Capital Savings Bancorp,
Inc........................ 276,000
117,800 CCF Holding Co.*............. 1,325,250
175,000 Cenfed Financial Corp........ 4,025,000
42,900 CF Bancorp, Inc.............. 1,694,550
50,000(D) Citizens Investments, Inc.*
(cost $650,000-purchased
1994)...................... 883,000
176,500 Community Financial Corp.
Illinois................... 2,206,250
123,100 Dime Financial Corp.
Connecticut*............... 1,415,650
182,000 Downey Financial Corp........ 3,640,000
111,700 Eastern Bancorp, Inc......... 2,485,325
34,800 FFE Financial Corp.*......... 635,100
76,200 Financial Security Corp...... 1,466,850
105,000 First Bell Bancorp, Inc...... 1,338,750
63,000 First Fed Bancorp, Inc....... 1,480,500
2,000 First Federal Bankshares..... 40,000
145,000 First Mutual Bancorp, Inc.... 1,812,500
346,000 First Republic Bancorp,
Inc........................ 4,498,000
139,000 FirstFed Financial Corp...... 2,171,875
56,000 FirstFed Michigan Corp....... 1,946,000
77,000 Fort Bend Holdings Corp...... 1,443,750
1,805 Glendale Federal Bank
California*................ 29,783
100,000 Great American Bancorp,
Inc.*...................... 1,325,000
373,300 Greenpoint Financial Corp.... 10,265,750
57,900 Hallmark Capital Corp.*...... 882,975
420,000 HF Bancorp, Inc.*............ 3,990,000
10,000 HFB Financial Corp........... 180,000
25,000 Home Bancorp*................ 381,250
140,000 ISB Financial Corp........... 2,170,000
77,000 Industrial Bancorp, Inc...... 972,125
62,800 Kirksville Bancshares,
Inc........................ 2,574,800
588,000 Long Island Bancorp, Inc..... 14,259,000
196,000 Main Street Community
Bancorp, Inc............... 3,283,000
181,000 Mid Continent Bancshares,
Inc........................ 3,348,500
84,700 NS & L Bancorp, Inc.......... 1,079,925
64,800 OSB Financial Corp........... 1,555,200
467,200 People's Bank................ 9,928,000
174,600 Perpetual Federal Savings
Bank....................... 2,204,325
321,600 Queens County Bancorp,
Inc........................ 12,783,600
182,000 Redfed Bancorp, Inc.*........ 1,729,000
93,800 Redwood Financial, Inc.*..... $ 891,100
617,000 River Bank America New
York....................... 4,164,750
53,850 Rock Financial Corp.......... 1,453,950
47,800 Rowan Savings Bank, Inc.*.... 717,000
140,000 SFFed Corp................... 4,217,500
125,600 SFS Bancorp, Inc.*........... 1,601,400
206,000 SGV Bancorp, Inc.*........... 1,957,000
10,000 Telebanc Financial Corp.*.... 65,000
16,500 Three Rivers Financial
Corp.*..................... 198,000
57,100 Tri-County Bancorp, Inc...... 927,875
24,000 Valley Federal Savings
Bank....................... 612,000
300,000 Westcorp, Inc................ 6,075,000
26,000 Workingmens Capital Holdings,
Inc........................ 416,000
------------
137,416,533
------------
Other Financial Intermediaries--24.5%
294,000 CTL Credit, Inc.*............ 4,263,000
378,000 Express America Holdings
Corp.*..................... 2,126,250
355,200 First Financial Caribbean
Corp....................... 5,949,600
112,000 First Mortgage Corp.......... 588,000
278,000 Hamilton Financial
Services*.................. 590,750
273,000 Imperial Credit Industries,
Inc.*...................... 7,575,750
619,300 Inco Homes Corp.*............ 619,300
99,000 PMC Commercial Trust......... 1,435,500
330,000 Prime Capital Corp.*......... 453,750
199,000 Prime Residential, Inc....... 3,059,625
144,000 Redwood Trust, Inc........... 2,844,000
160,983(D) Redwood Trust, Inc.*
(cost $2,144,473-purchased
1995)...................... 3,179,414
140,000 Schuler Homes, Inc.*......... 1,610,000
126,000 Security Capital Corp.
(Wisconsin)................ 6,678,000
444,000 Standard Financial, Inc.*.... 6,216,000
539,500 Sundance Homes, Inc.*........ 1,348,750
30,594(D) Tempest Reinsurance Co.,
Ltd.*
(cost $3,061,449-
purchased 1993-1995)....... 4,344,348
------------
52,882,037
------------
Total common stocks
(cost $146,808,138)........ 190,298,570
------------
Preferred Stocks--1.9%
100,000 Community Bank Huntington
Park....................... 2,425,000
68,000 River Bank America New
York....................... 1,564,000
------------
Total preferred stocks
(cost $4,129,713).......... 3,989,000
------------
</TABLE>
See Notes to Financial Statements.
4
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
- ---------------------------------------------------------
<C> <S> <C>
Value
Warrants Description (Note 1)
- ---------------------------------------------------------
Warrants*--0.6%
50,000 Community Bank,
expiring June '99............. $ 112,500
160,876(D) Redwood Trust, Inc.,
expiring December '97......... 1,206,570
------------
Total warrants (cost
$368,663)..................... 1,319,070
------------
Total long-term investments
(cost $151,306,514)........... 195,606,640
------------
<CAPTION>
Principal
Amount
(000) SHORT-TERM INVESTMENTS--10.2%
- -------
<C> <S> <C>
Brookline Savings Bank,
Certificates of Deposit,
$ 3 5.50%, 10/14/95................. 2,670
1 4.00%, 10/25/95................. 1,064
1 5.00%, 12/11/95................. 1,151
22,066 Swiss Bank Corp.,
Repurchase Agreement, 6.43%,
dated 9/29/95, due 10/2/95 in
the amount of $22,077,824
(cost $22,066,000;
collateralized by $22,765,000
U.S. Treasury Notes, 5.25%,
due 10/1/95; value including
accrued
interest-$22,598,083)......... 22,066,000
------------
Total short-term investments
(cost $22,070,885)............ 22,070,885
------------
Total Investments--100.8%
(cost $173,377,399; Note 3)... 217,677,525
Liabilities in excess of other
assets--(0.8%)................ (1,695,130)
------------
Net Assets--100%................ $215,982,395
------------
------------
</TABLE>
- ------------------
* Non-income producing security.
(D) Indicates a restricted security; the cost of such securities is
$6,063,136. The aggregate value ($9,613,332) is approximately 4.5% of net
assets.
- ----------------------------------------------------------
FIRST FINANCIAL FUND, INC.
Statement of Assets and Liabilities
September 30, 1995
(Unaudited)
- ----------------------------------------------------------
<TABLE>
<S> <C>
Assets
Investments, at value (cost
$173,377,399)........................ $217,677,525
Cash................................... 482
Dividends and interest receivable...... 93,336
Deferred expenses and other assets..... 77,258
------------
Total assets....................... 217,848,601
------------
Liabilities
Payable for investments purchased...... 1,182,748
Advisory fee payable................... 555,035
Administration fee payable............. 70,130
Accrued expenses....................... 43,738
Deferred director's fees............... 14,555
------------
Total liabilities.................. 1,866,206
------------
Net Assets............................. $215,982,395
------------
------------
Net assets were comprised of:
Common stock, at par;
15,823,742 shares issued........... $ 15,824
Paid-in capital in excess of par..... 155,795,303
Cost of 1,501,100 shares held in
treasury........................... (17,300,834)
------------
138,510,293
Undistributed net investment
income............................. 1,586,312
Accumulated net realized gains....... 31,585,664
Net unrealized appreciation of
investments........................ 44,300,126
------------
Net assets, September 30, 1995....... $215,982,395
------------
------------
Net asset value per share ($215,982,395
/ 14,322,642 shares of common stock
outstanding)......................... $15.08
------------
------------
</TABLE>
See Notes to Financial Statements. See Notes to Financial Statements.
5
<PAGE>
<PAGE>
- ----------------------------------------------------------
FIRST FINANCIAL FUND, INC.
Statement of Operations
Six Months Ended September 30, 1995
(Unaudited)
- ----------------------------------------------------------
<TABLE>
<S> <C>
Net Investment Income
Income
Dividends............................. $ 1,822,694
Interest.............................. 156,594
-----------
Total income........................ 1,979,288
-----------
Expenses
Investment advisory fee............... 594,183
Administration fee.................... 135,104
Custodian's fees and expenses......... 51,000
Insurance expense..................... 31,000
Reports to shareholders............... 28,000
Legal fees and expenses............... 24,000
Director's fees....................... 16,000
Audit fee............................. 12,500
Listing fees.......................... 12,000
Transfer agent's fees and expenses.... 9,000
Miscellaneous......................... 5,019
-----------
Total operating expenses............ 917,806
Loan interest (Note 4).............. 259,840
-----------
Total expenses...................... 1,177,646
-----------
Net investment income................... 801,642
-----------
Realized and Unrealized
Gain on Investments
Net realized gain on investment
transactions.......................... 23,391,760
Net change in unrealized
appreciation/depreciation of
investments........................... 33,574,752
-----------
Net gain on investments................. 56,966,512
-----------
Net Increase in Net Assets
Resulting from Operations............... $57,768,154
-----------
-----------
</TABLE>
- ----------------------------------------------------------
FIRST FINANCIAL FUND, INC.
Statement of Changes
in Net Assets
(Unaudited)
- ----------------------------------------------------------
<TABLE>
<CAPTION>
Increase (Decrease)
in Net Assets
<S> <C> <C>
Six Months
Ended Year Ended
September 30, March 31,
1995 1995
------------- ------------
Operations
Net investment income..... $ 801,642 $ 753,685
Net realized gain on
investment
transactions............ 23,391,760 34,989,298
Net change in unrealized
appreciation/depreciation
of investments.......... 33,574,752 (1,072,927)
------------- ------------
Net increase in net assets
resulting from
operations.............. 57,768,154 34,670,056
------------- ------------
Dividends and distributions
(Note 1)
Dividends from net
investment income....... -- (281,714)
Distributions from net
realized gains on
investments............. -- (49,356,052)
Value of Fund shares issued
to shareholders in
reinvestment of dividends
and distributions......... -- 29,609,858
------------- ------------
Total increase.............. 57,768,154 14,642,148
Net Assets
Beginning of period......... 158,214,241 143,572,093
------------- ------------
End of period............... $ 215,982,395 $158,214,241
------------- ------------
------------- ------------
</TABLE>
See Notes to Financial Statements. See Notes to Financial Statements.
6
<PAGE>
<PAGE>
- ----------------------------------------------------------
FIRST FINANCIAL FUND, INC.
Notes to Financial Statements
(Unaudited)
- ----------------------------------------------------------
First Financial Fund, Inc. (the ``Fund'') was incorporated in Maryland on
March 3, 1986, as a closed-end, diversified investment company. The Fund had no
operations until April 24, 1986, when it sold 10,000 shares of common stock for
$100,000 to Wellington Management Company (the ``Investment Adviser'').
Investment operations commenced on May 1, 1986. The Fund's primary investment
objective is to achieve long-term capital appreciation with the secondary
objective of current income by investing in securities issued by savings and
banking institutions and their holding companies. The ability of issuers of debt
securities held by the Fund to meet their obligations may be affected by
economic developments in a specific industry or region.
Note 1. Accounting The following is a summary of
Policies significant accounting policies
followed by the Fund in the preparation of its
financial statements.
Securities Valuation: Each security traded on a national securities exchange
will be valued on the basis of the last sales price on the valuation date on the
principal exchange on which the security is traded. Securities traded in the
over-the-counter market and on one or more exchanges will generally be valued
using the quotations the Board of Directors or its delegate believe reflect most
closely the value of such securities. Securities for which no trades have taken
place that day and unlisted securities for which market quotations are readily
available are valued at the latest bid price. Securities for which market
quotations are not readily available, including restricted securities, will be
valued at fair value as determined in good faith according to pricing procedures
developed by the Investment Adviser and approved by the Board of Directors.
Short-term securities which mature in more than 60 days are valued at current
market quotations. Short-term securities which mature in 60 days or less are
valued at amortized cost.
In connection with repurchase agreement transactions with financial
institutions, it is the Fund's policy that its custodian take possession of the
underlying collateral securities, the value of which exceeds the principal
amount of the repurchase transaction, including accrued interest. If the seller
defaults, and the value of the collateral declines or if bankruptcy proceedings
are commenced with respect to the seller of the security, realization of the
collateral by the Fund may be delayed or limited.
The Fund may invest up to 20% of its total assets in securities which are not
readily marketable, including those which are restricted as to disposition under
securities law (``restricted securities''). With regards to the restricted
securities held by the Fund at September 30, 1995, the Fund may not demand
registration by the issuers. Restricted securities are valued pursuant to the
valuation procedures noted above.
Securities Transactions and Investment Income: Securities transactions are
recorded on the trade date. Realized gains or losses on sales of securities are
calculated on the identified cost basis. Dividend income is recorded on the
ex-dividend date; interest income is recorded on the accrual basis.
Federal Income Taxes: It is the Fund's intention to continue to meet the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable income to shareholders.
Therefore, no federal income tax provision is required.
Dividends and Distributions: The Fund expects to declare and pay, at least
annually, dividends from net investment income and any net capital gains.
Dividends and distributions are recorded on the ex-dividend date.
Income distributions and capital gain distributions are determined in
accordance with income tax regulations which may differ from generally accepted
accounting principles. These differences are primarily due to differing
treatments for wash sales.
Note 2. Agreements The Fund has agreements
with the Investment Adviser and with Prudential
Mutual Fund Management, Inc. (the ``Administrator''). The Investment Adviser
makes investment decisions on behalf of the Fund; the Administrator provides
occupancy and certain clerical and accounting services to the Fund. The Fund
bears all other costs and expenses.
The investment advisory agreement provides for the Investment Adviser to
receive a fee, computed monthly and payable quarterly, at the following annual
rates: .75% of the Fund's average month-end net assets up to and including $50
million, and .625% of such assets in excess of $50 million. The administration
agreement provides for the Administrator to receive a fee, computed monthly and
payable quarterly, at the annual rate of .15% of the Fund's average month-end
net assets.
7
<PAGE>
<PAGE>
Note 3. Portfolio Purchases and sales of invest-
Securities ment securities, other than
short-term investments, for the six months ended
September 30, 1995 were $67,953,501 and $102,257,383, respectively.
The cost basis of the Fund's investments, including short-term investments,
at September 30, 1995 was $173,604,424; and, accordingly, net unrealized
appreciation for federal income tax purposes was $44,073,101 (gross unrealized
appreciation--$52,889,044; gross unrealized depreciation--$8,815,943).
Note 4. Borrowings The Fund has a credit agree-
ment (the ``Agreement'') with an unaffiliated
lender. The maximum commitment under the Agreement is $20,000,000. These
borrowings may be set to any desired maturity from one week to one year at a
rate of interest determined by the lender at the time of borrowing.
While outstanding, each borrowing will bear interest, pay-
able at maturity. The average daily balance outstanding for the six months ended
September 30, 1995 was $9,516,340 at a weighted average interest rate of 7.0%.
The highest face amount of borrowing outstanding at any month end during the six
months ended September 30, 1995 was $16,000,000. There were no borrowings
outstanding as of September 30, 1995.
The Fund has paid commitment fees at an annual rate of .25 of 1% on any
unused portion of the credit facility. Commitment fees are included in ``Loan
Interest'' as reported on the Statement of Assets and Liabilities and on the
Statement of Operations.
Note 5. Capital There are 50 million shares of
$.001 par value common stock authorized. Of the
15,823,742 shares issued as of September 30, 1995, the Investment Adviser owned
10,994 shares. During the fiscal year ended March 31, 1995, the Fund issued
3,054,137 shares in connection with a cash distribution paid in stock.
Note 6. Quarterly Data
<TABLE>
<CAPTION>
Net increase
Net
realized and (decrease) in net
unrealized assets
Net investment gains
(losses) on resulting from
Total income (loss)
investments operations
Quarterly Period Ended income Amount Per share Amount
Per share Amount Per share
<S> <C> <C> <C> <C>
<C> <C> <C>
- ------------------------------ ------------ --------------------
- ------------------------ ------------------------
June 30, 1993 $528,908 $100,191 $.01
$(1,925,304) $(0.24) $(1,825,113) $(0.23)
September 30, 1993 635,894 91,662 .01
23,869,025 2.91 23,960,687 2.92
December 31, 1993 954,028 430,492 .04
4,848,157 .59 5,278,649 .63
March 31, 1994 415,658 (231,147) (.02)
28,365 .01 (202,782) (.01)
June 30, 1994 693,673 68,402 --
25,586,650 2.10 25,655,052 2.10
September 30, 1994 682,673 5,485 --
12,652,303 1.03 12,657,788 1.03
December 31, 1994 909,582 221,473 .02
(20,859,871) (1.70) (20,638,398) (1.68)
March 31, 1995 1,071,378 458,325 .03
16,537,289 1.33 16,995,614 1.36
June 30, 1995 953,648 351,644 .03
22,772,287 1.58 23,123,931 1.61
September 30, 1995 1,025,640 449,998 .03
34,194,225 2.39 34,644,223 2.42
<CAPTION>
Dividends
and Share
distributions price
Quarterly Period Ended Amount Per share High Low
<S> <C> <C> <C> <C>
- ------------------------------ ----------------------- ---------------
June 30, 1993 -- -- $ 15 1/2 $ 13 3/8
September 30, 1993 -- -- 17 3/4 14 3/8
December 31, 1993 -- -- 19 3/4 17
March 31, 1994 $59,182,960 $6.68 18 5/8 11 1/4
June 30, 1994 -- -- 15 1/2 11 3/4
September 30, 1994 -- -- 17 1/8 14
December 31, 1994 -- -- 16 12
March 31, 1995 49,637,766 4.41 14 3/4 11 1/8
June 30, 1995 -- -- 12 7/8 12 1/8
September 30, 1995 -- -- 16 1/4 14 1/2
</TABLE>
8
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
FIRST FINANCIAL FUND, INC.
Financial Highlights
(Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months
Ended
Year ended March 31,
September 30,
- ------------------------------------------------------
PER SHARE OPERATING PERFORMANCE: 1995 1995
1994 1993 1992 1991
<S> <C> <C>
<C> <C> <C> <C>
------------- --------
-------- -------- ------- -------
Net asset value, beginning of period............. $ 11.05 $ 12.74
$ 16.52 $ 10.50 $ 6.35 $ 7.09
------------- --------
-------- -------- ------- -------
Income from investment operations
Net investment income............................ .06 .05
.04 .08 .11 .18
Net realized and unrealized gain (loss) on
investments.................................... 3.97 2.76
3.27 7.89 4.15 (.71)
------------- --------
-------- -------- ------- -------
Total from investment operations............... 4.03 2.81
3.31 7.97 4.26 (.53)
------------- --------
-------- -------- ------- -------
Less dividends and distributions
Dividends from net investment income............. -- (.03)
(.05) (.02) (.11) (.18)
Distributions in excess of net investment
income......................................... -- --
-- -- (.01) (.03)
Distributions from net capital gains............. -- (4.38)
(6.63) (2.02) -- --
------------- --------
-------- -------- ------- -------
Total dividends and distributions.............. -- (4.41)
(6.68) (2.04) (.12) (.21)
------------- --------
-------- -------- ------- -------
Increase resulting from Fund share repurchase.... -- --
.08 .12 .01 --
Capital charge resulting from the issuance of
Fund shares.................................... -- (.09)
(.49) (.03) -- --
------------- --------
-------- -------- ------- -------
Net asset value, end of period................... $ 15.08 $ 11.05
$ 12.74 $ 16.52 $ 10.50 $ 6.35
------------- --------
-------- -------- ------- -------
------------- --------
-------- -------- ------- -------
Market price per share, end of period............ $ 14.625 $ 11.125
$ 12.00 $ 15.125 $ 10.00 $ 6.25
------------- --------
-------- -------- ------- -------
------------- --------
-------- -------- ------- -------
TOTAL INVESTMENT RETURN(b)....................... 36.47% 34.83%
24.22% 72.89% 62.32% (3.88)%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000).................. $ 215,982 $158,214
$143,572 $154,090 $99,067 $59,979
Average net assets (000)......................... $ 189,676 $164,322
$158,100 $125,361 $80,947 $54,198
Ratios to average net assets:
Expenses, before loan interest, commitment fees
and nonrecurring expenses.................... 0.96%(a) 1.03%
1.11% 1.13% 1.23% 1.55%
Total expenses................................. 1.24%(a) 1.58%
1.36% 1.21% 1.65% 2.14%
Net investment income.......................... 0.85%(a) 0.46%
0.25% 0.62% 1.33% 3.06%
Portfolio turnover rate.......................... 36% 103%
139% 105% 89% 42%
Total debt outstanding at end of period (000
omitted)....................................... -- $ 16,000
$ 15,000 -- $ 9,000 $ 3,000
Asset coverage(c)................................ -- $ 10,888
$ 10,571 -- $12,007 $20,993
</TABLE>
- ---------------
(a) Annualized.
(b) Total investment return is calculated assuming a purchase of common stock
at the current market value on the first day and a sale at the current
market value on the last day of each period reported. Dividends and
distributions are assumed for purposes of this calculation to be
reinvested at prices obtained under the dividend reinvestment plan. This
calculation does not reflect brokerage commissions.
(c) Per $1,000 of debt outstanding.
Contained above is selected data for a share of common stock outstanding,
total investment return, ratios to average net assets and other
supplemental data for the periods indicated. This information has been
determined based upon information provided in the financial statements
and market price data for the Fund's shares.
See Notes to Financial Statements.
9
<PAGE>
<PAGE>
SUPPLEMENTAL PROXY INFORMATION
The Annual Meeting of Shareholders of First Financial Fund, Inc. (The
``Fund'') was held on July 31, 1995 at the offices of Prudential Securities
Incorporated, One Seaport Plaza, New York, New York. The meeting was held for
the following purposes:
(1) To elect the following two directors to serve as follows:
<TABLE>
<CAPTION>
Director Class Term Expiring
------------------ ------ -------- ---------
<S> <C> <C> <C> <C>
Robin B. Smith III 3 years 1998
Nancy H. Teeters III 3 years 1998
Directors whose term of office continued beyond this meeting are Daniel
S. Ahearn, Edward D.
Beach and Thomas T. Mooney.
To ratify the selection of Deloitte & Touche LLP as independent public
accountants for the
(2) fiscal year ending March 31, 1996.
(3) To transact such other business as may properly come before the meeting
or any adjournment
thereof.
</TABLE>
The results of the proxy solicitation on the above matters were as follows:
<TABLE>
<CAPTION>
Director/Auditor Votes for Votes against Votes
withheld Abstentions
---------------------- ----------- --------------
- --------------- ------------
<S> <C> <C> <C> <C>
<C>
(1) Robin B. Smith 11,872,912 -- 75,559
--
Nancy H. Teeters 11,846,978 -- 101,493
--
(2) Deloitte & Touche LLP 11,828,820 55,368 --
64,284
(3) There was no other business voted upon at the Annual Meeting of
Shareholders.
</TABLE>
10
<PAGE>
<PAGE>
Directors
Daniel S. Ahearn
Edward D. Beach
Thomas T. Mooney
Robin B. Smith
Nancy H. Teeters
Investment Adviser
Wellington Management Company
75 State Street
Boston, Massachusetts 02109
Administrator
Prudential Mutual Fund Management, Inc.
One Seaport Plaza
New York, New York 10292
Custodian and Transfer Agent
State Street Bank and Trust Company
One Heritage Drive
North Quincy, Massachusetts 02171
Independent Accountants
Deloitte & Touche LLP
Two World Financial Center
New York, New York 10281
Legal Counsel
Kirkpatrick & Lockhart LLP
1800 M Street, N.W.
Washington, D.C. 20036
Notice is hereby given in accordance with Section 23(c) of the Investment
Company Act of 1940 that the Fund may purchase, from time to time, shares
of its common stock at market prices.
The accompanying financial statements as of September 30, 1995, were not
audited and, accordingly, no opinion is expressed on them.
This report is for shareholder information. This is not a prospectus
intended for use in the purchase or sale of Fund shares.
First Financial Fund, Inc.
One Seaport Plaza
New York, NY 10292
For information call toll free
(800) 451-6788
