PERFORMANCE
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN PREMIER MUNICIPAL BOND
FUND CLASS A SHARES
AND THE LEHMAN BROTHERS MUNICIPAL BOND INDEX
(Exhibit A)
*Source: Lehman Brothers
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURN
CLASS A CLASS B
-------------------------------------- ---------------------------------------------------
% Return Reflecting
% Return Applicable Contingent
Reflecting % Return Deferred Sales
% Return Without Maximum Initial Assuming No Charge Upon
PERIODS ENDED 4/30/94 SALES CHARGE SALES CHARGE (4.5%) PERIODS ENDED 4/30/94 REDEMPTION REDEMPTION*
- - --------------------- ----------- ------------------- -------------------- ---------- ------------
<S> <C> <C> <C> <C> <C>
1 Year 1.84% (2.73)% 1 Year 1.26% (1.61)%
5 Year 8.92 7.93 From Inception (1/15/93) 4.71 2.45
From Inception (11/26/86) 7.52 6.86
</TABLE>
Past performance is not predictive of future performance. Share price and
investment return fluctuate and share price may be more or less than original
cost upon redemption.
The above graph compares a $10,000 investment made in Class A shares of
Premier Municipal Bond Fund on 11/26/86 (Inception Date) to a $10,000
investment made in the Lehman Brothers Municipal Bond Index on that date. For
comparative purposes, the value of the Index on 11/30/86 is used as the
beginning value on 11/26/86. All dividends and capital gain distributions are
reinvested. Performance for Class B shares will differ from the results shown
above due to difference in charges and expenses charged to that class.
The Fund invests primarily in municipal securities and its performance shown
in the graph takes into account the maximum initial sales charge on Class A
shares and all other applicable fees and expenses. Unlike the Fund, the
Lehman Brothers Municipal Bond Index is an unmanaged total return performance
benchmark for the long-term, investment grade tax exempt bond market,
calculated by using municipal bonds selected to be representative of the
market. The Index does not take into account charges, fees and other
expenses. Further information relating to Fund performance, including
expense reimbursements, if applicable, is contained in the Condensed
Financial Information section of the Prospectus and elsewhere in this report.
* Maximum contingent deferred sale charge for Class B shares is 3% and is
reduced to 0% after five years.
PRESIDENT'S LETTER
Dear Shareholder:
As the annual reporting period for the Premier Municipal Bond Fund came
to a close on April 30, 1994, the net asset value per share of Class A shares
was $13.81, a decrease of approximately $.59 from the net asset value per
share on April 30, 1993, adjusted for capital gain distributions. The net
asset value per share for Class B shares was $13.81, a decrease of
approximately $.59 from the net asset value per share on April 30, 1993,
adjusted for capital gain distributions.
During the reporting period, tax exempt dividends of approximately $.89
per share were paid by Class A shares, representing a distribution rate per
share of 6.11%, based on the April 30, 1994 closing maximum offering price,
adjusted for capital gain distributions.
During the reporting period, tax exempt dividends of approximately $.80
per share were paid by Class B shares, representing a distribution rate per
share of 5.79%, based on the April 30, 1994 closing net asset value per
share, adjusted for capital gain distributions.
We are pleased to inform you that all dividends paid from net investment
income were exempt from Federal income tax.*
The Federal Reserve Board's actions to slow the rate of economic growth
slightly, thereby forming a strategy to fight inflation in the future, caused
the stock and bond markets to fall sharply in the first quarter of 1994. The
Federal Reserve can stimulate or rein in the economy by lowering or
increasing short-term interest rates, as it did with quarter point increases
in its target for Federal Funds. The Federal Funds rate is the rate that
banks charge each other for overnight loans and is currently adjusted to
4.0%. It is the main interest rate the Federal Reserve is using to influence
economic activity, and it was increased four times. These increases were the
first in five years, and at the time, the financial markets interpreted these
moves as a sign that the Federal Reserve perceived incipient inflation that
had eluded, or was contrary to, the views of many private economists and
investors.
Federal Reserve officials refuse to say precisely how much higher the
Federal Funds target would have to be to bring down the nation's borrowing
and spending so that the economy will grow at a rate that is considered
neutral. A neutral growth rate is defined as the fastest rate possible
without feeding inflation, and is believed to be the rate of growth equal to
the economy's underlying capacity to produce goods and services. Currently,
most economists think that rate is around 3%. Using unused factories and
unemployed workers, it would be possible to temporarily grow faster the rate
of total productive capacity. However, once the economy is operating at or
near full capacity and full employment, inflation could pick up, demonstrated
by rising prices for finished goods and by companies bidding up wages and
prices for factory goods. The Federal Reserve is concerned with such an
occurrence and is signaling that more increases in short-term rates could be
on the way. If these increases materialize, they should slow economic growth,
as companies and individuals pay more interest on their loans and mortgages
and preempt an inflationary condition as a result.
More immediately for investors, the Federal Reserve's stance means that
those who have been weathering declining markets in the last few months may
not be able to find comfort even if monthly inflation reports continue to
show that current price increases are moderate, as was indicated by the
latest round of figures. In the market, the prices of most Treasury,
corporate and municipal securities have fallen and so have the net asset
values of most fixed-income mutual funds. However, we believe the underlying
fundamentals for municipals remain solid in spite of the potential negative
tone of the overall bond market that could push yields higher. The
overwhelming positive factor for tax exempts is limited new supply. Through
April, gross issuance was 34% below the comparable period last year.
Additionally, in June and July, a large amount of municipal bond investment
will be returned to investors due to calls, refinancings and maturities. If
much of these proceeds is reinvested into the market, it should provide the
market with potential support. If this occurs, we think this can help provide
a setting for municipals to be a strong relative performing sector within the
fixed-income markets.
During the first half of its fiscal year, the Funds total return
benefited from the strong performance of the municipal market. Declining
interest rates, an accommodative Federal Reserve Board policy, low price
volatility, and a lackluster economy drove the municipal market to higher
price valuations. However, as the economy began to pick up steam during the
fourth quarter of 1993 and into the new year, a change in Federal Reserve
policy and rising interest rates had a negative impact on the municipal market
.
Last year, when rates were reaching their cyclical lows, we altered our
security selection strategy. Specifically, we elected not to chase the
market, and began to conduct our business somewhat more defensively. While
these actions limited performance during that period in 1993 when rates were
still declining, they positioned the Fund more advantageously for the market
decline which has occurred so far this year.
As we stated in our previous report to shareholders, it was our intention
to adopt a more defensive portfolio posture in order to reduce the volatility
of the portfolio. In response, we reduced the Funds exposure to those bonds
in the portfolio with the longest durations (price sensitivities) while
maintaining the more defensive securities (i.e., pre-refunded bonds), and
started building higher cash reserves. We still believe that a more defensive
stance currently is warranted in view of the heightened degree of uncertainty
about the near-term direction of the economy and inflation. Certainly, recent
moves by the Federal Reserve to hike short-term interest rates provide enough
of an impetus to maintain a cautious stance. The Federal Reserve generally act
s in a series of moves rather than taking a one shot approach.
While we increased our cash reserves, which are invested in tax exempt
cash equivalent securities, in seeking to lessen the impact of rising rates
on the Fund, we are reluctant to keep too much cash on hand. As mentioned
previously, higher interest rates have severely curtailed the volume of new
municipal securities so we have some concern about the potential periodic
shortage of tax exempts if the financial markets stabilize and investors
increase their level of purchases. Higher tax rates and the large number of
bonds being retired currently lead us to believe that the potential demand
for tax exempt securities is substantial, especially in those States with the
highest tax structures.
We have included a current statement of investments and recent financial
statements for your review. We look forward to serving your investment needs
in the future.
Very truly yours,
(Richard J. Moynihan Signature Logo)
Richard J. Moynihan
President
May 24, 1994
New York, N.Y.
*Some income may be subject to state and local taxes, and for certain
investors, the Federal Alternative Minimum Tax.
<TABLE>
<CAPTION>
PREMIER MUNICIPAL BOND FUND
STATEMENT OF INVESTMENTS APRIL 30, 1994
PRINCIPAL
MUNICIPAL BONDS-98.1% AMOUNT VALUE
------------- -------------
<S> <C> <C>
ALABAMA-1.3%
Courtland Industrial Development Board, SWDR (Champion International Corp.
Project)
6.375%, 3/1/2029........................................................ $ 8,700,000 $ 8,023,227
ARIZONA-1.5%
Maricopa County Pollution Control Corp., PCR, Refunding
(Public Service Co. - Palo Verde) 6.375%, 8/15/2023..................... 7,000,000 6,243,650
Tucson Airport Authority, Inc., Special Facility Revenue
(Lockheed Aermod Center, Inc.) 8.70%, 9/1/2019.......................... 2,500,000 2,839,150
COLORADO-7.2%
City and County of Denver, Airport Revenue:
7.75%, 11/15/2021....................................................... 8,000,000 8,075,600
7.25%, 11/15/2023....................................................... 10,000,000 9,613,300
7%, 11/15/2025.......................................................... 18,225,000 16,965,288
Colorado Health Facilities Authority, Retirement Facilities Revenue
(Liberty Heights) Zero Coupon, 7/15/2024................................ 10,000,000 1,129,600
Dawson Ridge, Metropolitan District Number 1, Refunding:
Zero Coupon, 10/1/2017.................................................. 9,930,000 2,050,247
Zero Coupon, 10/1/2022.................................................. 47,535,000 7,008,560
CONNECTICUT-2.9%
Connecticut Development Authority, First Mortgage Gross Revenue
(Elim Park Baptist Home, Inc. Project) 9%, 12/1/2020.................... 3,000,000 3,189,810
Connecticut Health and Educational Facilities Authority, Revenue
(Sacred Heart University) 5.80%, 7/1/2023............................... 1,700,000 1,478,303
Connecticut Housing Finance Authority (Housing Mortgage Finance Program)
6.70%, 11/15/2022....................................................... 13,000,000 13,126,490
FLORIDA-1.9%
Lake County Resources Recreation, IDR, Refunding (NRG/Recovery Group)
5.85%, 10/1/2009........................................................ 5,750,000 5,314,610
Palm Beach County, Solid Waste IDR (Okeelanta Power LP Project)
6.85%, 2/15/2021........................................................ 6,750,000 6,299,302
GEORGIA-1.4%
Atlanta, Airport Facilities, Refunding 7.25%, 1/1/2017...................... 5,000,000 5,302,750
Hogansville, Combined Public Utility System Revenue, Refunding (Asset
Guaranty)
6%, 10/1/2023........................................................... 3,475,000 3,279,288
ILLINOIS-12.3%
Alton, Health Facilities Revenue (Barnes-Jewish, Inc. Christian) 5.50%, 5/15/2021 7,000,000 6,113,730
Chicago O'Hare International Airport, Special Facility Revenue:
(American Airlines, Inc. Project) 7.875%, 11/1/2025..................... 6,000,000 6,202,200
(United Airlines, Inc.):
8.20%, 5/1/2018....................................................... 2,195,000 2,346,455
8.50%, 5/1/2018....................................................... 3,500,000 3,748,430
East Chicago, PCR, Refunding (Inland Steel Co. Project Number 10) 6.80%, 6/1/2013 9,000,000 8,566,110
PREMIER MUNICIPAL BOND FUND
STATEMENT OF INVESTMENTS (CONTINUED) APRIL 30, 1994
PRINCIPAL
MUNICIPAL BONDS (CONTINUED) AMOUNT VALUE
------------- -------------
ILLINOIS (CONTINUED)
Illinois Development Finance Authority, Revenue:
(Community Rehabilitation Providers Facility):
8.75%, 3/1/2010....................................................... $ 2,725,000 $ 2,937,359
8.50%, 9/1/2010....................................................... 4,535,000 4,887,642
8.25%, 8/1/2012....................................................... 4,380,000 4,464,359
Retirement Housing (Regency Park) Zero Coupon, 7/15/2023................ 85,000,000 10,319,850
Illinois Health Facilities Authority, Revenue:
(Beverly Farm Foundation) 9.125%, 12/15/2015............................ 2,000,000 2,165,780
(Delnor Community Hospital Project) 8%, 5/15/2019 (Prerefunded 5/15/1999) (a) 5,500,000 6,299,920
(Refunding - Masonic Medical Center) 5.50%, 10/1/2019 .................. 5,000,000 4,197,350
(Trinity Medical Center) 7%, 7/1/2012................................... 6,750,000 6,782,400
Illinois Housing Development Authority, Multi-Family Program 6.75%, 9/1/2021. 7,350,000 7,393,953
INDIANA-1.2%
Indianapolis Local Public Improvement Bond Bank, Refunding 6.75%, 2/1/2020.. 7,500,000 7,473,825
IOWA-1.5%
Council Bluffs, PCR, Refunding (Midwest Power Systems, Inc.) 5.95%, 5/1/2023. 10,000,000 9,237,300
LOUISIANA-4.1%
Lake Charles Non-Profit Housing Development Corp., First Mortgage Revenue,
Refunding (Chateau Project) 7.875%, 2/15/2025 (Insured; FHA)............ 1,000,000 1,005,070
Louisiana Public Facilities Authority, Revenue (Student Loan) 7%, 9/1/2006.. 3,000,000 3,081,720
Parish of Saint Charles, PCR (Louisiana Power and Light Co. Project)
7.50%, 6/1/2021......................................................... 3,750,000 3,894,900
Parish of West Feliciana, PCR:
(Gulf States Utilities - II) 7.70%, 12/1/2014........................... 10,000,000 10,677,800
(Gulf States Utilities - III) 7.70%, 12/1/2014.......................... 6,500,000 6,925,425
MARYLAND-.3%
Maryland Community Development Administration, Department of Housing and
Community Development (Single Family Program) 7.70%, 4/1/2015........... 2,085,000 2,195,693
MASSACHUSETTS-1.6%
Massachusetts Health and Educational Facilities Authority, Revenue
(Tufts University) 8.25%, 8/15/2018 (b)................................. 4,000,000 3,517,600
Massachusetts Housing Finance Agency, SFHR 7.95%, 6/1/2023.................. 2,000,000 2,089,300
New England Education Loan Marketing Corp., Student Loan Revenue
6.90%, 11/1/2009........................................................ 4,000,000 4,127,120
MICHIGAN-4.4%
Detroit, Sewer Disposal Revenue 8.33%, 7/1/2023 (Insured; FGIC) (b)......... 7,500,000 6,375,000
Greater Detroit Resources Recovery Authority, Revenue:
9.25%, Series A, 12/13/2008............................................. 8,440,000 9,019,490
9.25%, Series D, 12/13/2008............................................. 250,000 267,165
9.25%, Series E, 12/13/2008............................................. 1,000,000 1,068,660
9.25%, Series H, 12/13/2008............................................. 2,045,000 2,185,410
Michigan Hospital Finance Authority, Revenue, Refunding (Detroit Medical Center)
6.50%, 8/15/2018........................................................ 5,000,000 4,886,050
PREMIER MUNICIPAL BOND FUND
STATEMENT OF INVESTMENTS (CONTINUED) APRIL 30, 1994
PRINCIPAL
MUNICIPAL BONDS (CONTINUED) AMOUNT VALUE
------------- -------------
MICHIGAN (CONTINUED)
Wayne County Building Authority 8%, 3/1/2017................................ $ 1,500,000 $ 1,754,580
Western Townships Utilities Authority, Sewer Disposal System (Limited Tax)
8.20%, 1/1/2018......................................................... 1,500,000 1,682,970
MISSISSIPPI-.3%
Medical Center Educational Building Corp., Revenue
(University Medical Center Project) 5.90%, 12/1/2023.................... 2,250,000 2,115,967
NEBRASKA-2.0%
Nebraska Higher Education Loan Program, Inc., Revenue 6.40%, 6/1/2013....... 12,500,000 12,533,250
NEVADA-4.0%
Clark County, IDR (Southwest Gas Corp.):
7.50%, 9/1/2032......................................................... 13,000,000 13,307,450
6.50%, 12/1/2033........................................................ 13,000,000 11,703,380
NEW HAMPSHIRE-.6%
New Hampshire Housing Finance Authority, Single Family Residential Mortgage
7.70%, 7/1/2029......................................................... 3,675,000 3,818,546
NEW JERSEY-2.8%
Camden County Pollution Control Financing Authority, Solid Waste RRR
7.50%, 12/1/2010........................................................ 2,000,000 2,051,980
New Jersey Economic Development Authority, First Mortgage Gross Revenue
(The Evergreens) 9.25%, 10/1/2022....................................... 15,000,000 15,630,300
NEW MEXICO-.3%
New Mexico Educational Assistance Foundation, Student Loan Revenue
6.85%, 12/1/2005........................................................ 2,000,000 2,028,380
NEW YORK-17.7%
Metropolitan Transportation Authority, Service Contract, Commuter Facilities
7.50%, 7/1/2016 (Prerefunded 7/1/2000) (a).............................. 3,000,000 3,425,970
New York City:
8%, 6/1/2000............................................................ 2,200,000 2,473,900
7.50%, 2/1/2001......................................................... 5,000,000 5,509,750
6%, 5/15/2008........................................................... 8,970,000 8,768,893
7.50%, 8/15/2008........................................................ 2,000,000 2,152,660
7.10%, 2/1/2009......................................................... 5,000,000 5,330,900
6%, 5/15/2009........................................................... 5,000,000 4,853,950
7%, 2/1/2020............................................................ 12,000,000 12,547,920
Refunding 5.70%, 8/1/2009............................................... 3,450,000 3,241,413
New York City Industrial Development Agency, Special Facilities Revenue
(American Airlines, Inc. Project) 8%, 7/1/2020.......................... 3,250,000 3,412,402
New York City Municipal Water Finance Authority, Water and Sewer Systems
Revenue:
7%, 6/15/2001........................................................... 2,490,000 2,779,039
7.375%, 6/15/2009 (Prerefunded 6/15/1999) (a)........................... 4,000,000 4,450,160
7%, 6/15/2015 (Prerefunded 6/15/2001) (a)............................... 2,510,000 2,623,402
New York State Dormitory Authority, Revenue:
City University Systems 7.625%, 7/1/2020 (Prerefunded 7/1/2000) (a)..... 4,000,000 4,594,160
State University Educational Facilities 7%, 5/15/2018 (Prerefunded 5/15/2000) (a) 3,295,000 3,671,658
PREMIER MUNICIPAL BOND FUND
STATEMENT OF INVESTMENTS (CONTINUED) APRIL 30, 1994
PRINCIPAL
MUNICIPAL BONDS (CONTINUED) AMOUNT VALUE
------------- -------------
NEW YORK (CONTINUED)
New York State Dormitory Authority, Revenue (continued):
Upstate Community Colleges:
5.25%, 7/1/2005....................................................... $ 1,770,000 $ 1,671,800
5.375%, 7/1/2006...................................................... 1,995,000 1,893,514
New York State Energy Research and Development Authority,
Electric Facilities Revenue:
(Consolidated Edison Co. of New York, Inc.):
7.50%, 7/1/2025................................................... 3,000,000 3,219,300
7.50%, 1/1/2026................................................... 2,000,000 2,138,600
(Long Island Lighting Co.) 7.15%, 6/1/2020............................ 4,000,000 4,073,920
New York State Housing Finance Agency, Revenue:
(Refunding - Health Facilities - New York City) 8%, 11/1/2008........... 5,000,000 5,586,150
Service Contract Obligation 7.30%, 3/15/2021 (Prerefunded 9/15/2001) (a) 5,000,000 5,684,800
New York State Local Government Assistance Corp.
7%, 4/1/2016 (Prerefunded 4/1/2001) (a)................................. 5,500,000 6,156,370
New York State Medical Care Facilities Finance Agency, Revenue
6.622%, 8/15/2006 (Insured; FSA) (b,c).................................. 8,300,000 7,075,750
(Mental Health Service Facilities Improvement):
7.875%, 8/15/2020..................................................... 1,335,000 1,477,151
Refunding 7.875%, 8/15/2000 (Prerefunded 8/15/2000) (a)............... 1,150,000 1,330,527
NORTH CAROLINA-1.1%
North Carolina Eastern Municipal Power Agency, Power System Revenue
8.397%, 1/1/2019 (b,c).................................................. 8,400,000 7,182,000
OHIO-.6%
Gateway Economic Development Corp., Greater Cleveland Excise Tax Revenue
7.50%, 9/1/2005......................................................... 3,500,000 3,852,905
OKLAHOMA-.7%
Tulsa Municipal Airport Trust, Revenue (American Airlines, Inc.) 7.375%, 12/1/2020 4,300,000 4,326,746
PENNSYLVANIA-6.2%
Blair County Hospital Authority, Revenue (Altoona Hospital) 8.46%, 7/1/2013 (b) 5,000,000 5,124,850
Lancaster County Hospital Authority, Revenue (Health Center - United Church
Homes Project) 9.125%, 10/1/2014........................................ 1,465,000 1,618,722
Lehigh County General Purpose Authority, Revenue (Wiley House):
8.75%, 11/1/2014........................................................ 2,000,000 2,000,000
9.50%, 11/1/2016........................................................ 3,000,000 3,085,470
Montgomery County Higher Education and Health Authority, Revenue
(AHF/Montgomery, Inc. Project) 10.50%, 9/1/2020......................... 3,500,000 3,757,600
Pennsylvania Economic Development Financing Authority, RRR
(Northampton Generating - A):
6.40%, 1/1/2009....................................................... 2,500,000 2,371,600
6.50%, 1/1/2013....................................................... 3,500,000 3,280,795
Pennsylvania Intergovernmental Cooperative Authority, Special Tax Revenue
(Philadelphia Funding Program) 6.80%, 6/15/2022 (Prerefunded 6/15/2002) (a) 5,500,000 6,023,655
Philadelphia, Water and Sewer Revenue 7.35%, 9/1/2004....................... 4,980,000 5,564,403
PREMIER MUNICIPAL BOND FUND
STATEMENT OF INVESTMENTS (CONTINUED) APRIL 30, 1994
PRINCIPAL
MUNICIPAL BONDS (CONTINUED) AMOUNT VALUE
------------- -------------
PENNSYLVANIA (CONTINUED)
Philadelphia Hospital and Higher Education Facility Authority, HR
(Graduate Health Systems) 7.25%, 7/1/2018............................... $ 6,100,000 $ 6,172,773
RHODE ISLAND-.4%
Rhode Island Depositors Economic Protection Corp., Special Obligation
6.95%, 8/1/2022 (Prerefunded 8/1/2002) (a).............................. 2,000,000 2,232,840
TENNESSEE-1.6%
McMinn County Industrial Development Board, PCR
(Calhoun Newsprint Co. Project) 7.625%, 3/1/2016........................ 3,000,000 3,150,180
Metropolitan Government of Nashville and Davidson County, IDB, Revenue
(Refunding - Multi-Family Mortgage - Picadilly) 6.95%, 7/1/2027 (Insured; FHA) 6,705,000 6,898,238
TEXAS-9.3%
Alliance Airport Authority, Inc., Special Facilities Revenue
(American Airlines, Inc. Project):
7%, 12/1/2011......................................................... 10,700,000 10,566,678
7.50%, 12/1/2029...................................................... 6,000,000 6,058,020
Brazos Higher Education Authority, Inc., Student Loan Revenue, Refunding
5.875%, 6/1/2004........................................................ 6,000,000 5,921,160
Brazos River Authority, PCR (Collateralized, Texas Utilities Electric Co.
Project)
7.875%, 3/1/2021........................................................ 490,000 528,499
Dallas - Fort Worth International Airport Facility Improvement Corp., Revenue
(American Airlines, Inc.) 7.50%, 11/1/2025.............................. 13,000,000 13,126,230
Gulf Coast Waste Disposal Authority, Revenue (Champion International Corp.)
7.45%, 5/1/2026......................................................... 7,000,000 7,283,150
Port Corpus Christi Authority, PCR, Refunding (Hoechst Celanese Co. Project)
7.50%, 8/1/2012......................................................... 4,000,000 4,351,960
Texas Housing Agency, SFMR 7.875%, 9/1/2012................................. 985,000 1,012,176
Texas Public Property Finance Corp., Revenue (Mental Health and Retardation
Center)
8.20%, 10/1/2012 (Prerefunded 10/1/2002) (a)............................ 9,075,000 9,392,625
UTAH-3.3%
Carbon County, SWDR, Refunding:
(East Carbon Development Corp.) 9%, 7/1/2012............................ 4,000,000 4,188,680
(Sunnyside Cogeneration) 9.25%, 7/1/2018................................ 15,000,000 16,113,600
VIRGINIA-.8%
Albemarle County Industrial Development Authority, HR, Refunding
(Martha Jefferson Hospital) 5.875%, 10/1/2013........................... 2,360,000 2,238,248
Virginia Housing Development Authority, Commonwealth Mortgage 6.20%, 7/1/2021 3,255,000 3,081,346
WASHINGTON-1.4%
Pierce County Economic Development Corp., Revenue (Solid Waste - Occidental
Petrol)
5.80%, 9/1/2029......................................................... 6,750,000 5,905,778
Pilchuck Development Public Corp., Revenue, Refunding (Industrial - Little
Neck
Properties Project) 6.25%, 8/1/2010 (LOC; US Bank of Washington) (d).... 3,090,000 3,049,336
PREMIER MUNICIPAL BOND FUND
STATEMENT OF INVESTMENTS (CONTINUED) APRIL 30, 1994
PRINCIPAL
MUNICIPAL BONDS (CONTINUED) AMOUNT VALUE
------------- -------------
WEST VIRGINIA-1.6%
West Virginia Parkways Economic Development and Tourism Authority:
7.380%, 5/15/2013 (b)................................................... $ 5,000,000 $ 4,198,550
8.595%, 5/16/2019 (Insured; FGIC) (b)................................... 4,000,000 3,530,000
West Virginia Water Development Authority, Water Development Revenue
(Loan Program II) 7.50%, 11/1/2029 (Prerefunded 11/1/1999) (a).......... 1,900,000 2,146,183
WYOMING-.6%
Wyoming Community Development Authority, Single Family Mortgage 8%, 6/1/2021. 3,600,000 3,740,652
U.S. RELATED-1.2%
Guam Government 5.40%, 11/15/2018........................................... 3,775,000 3,249,897
Puerto Rico Commonwealth, Refunding 5.50%, 7/1/2013......................... 5,000,000 4,544,450
-------------
TOTAL MUNICIPAL BONDS (cost $606,166,272)................................... $612,033,098
-------------
-------------
CONTRACTS
SUBJECT TO
PUT OPTIONS-.1% PUT
-------------
U.S. Treasury Notes:
June '94 @ $108......................................................... 100 $ 278,125
June '94 @ $109......................................................... 100 373,438
--------------
TOTAL PUT OPTIONS (cost $334,537)........................................... $ 651,563
--------------
--------------
PRINCIPAL
SHORT-TERM MUNICIPAL INVESTMENT-1.8% AMOUNT
-------------
FLORIDA;
Orange County Health Facilities Authority, Revenue, VRDN
(Adventist Health Systems/Sunbelt) 3.20% (LOC; Banque Paribas) (d,e)
(cost $11,000,000)...................................................... $ 11,000,000 $ 11,000,000
-------------
-------------
TOTAL INVESTMENTS-100.0%
(cost $617,500,809)..................................................... $623,684,661
-------------
-------------
</TABLE>
<TABLE>
<CAPTION>
PREMIER MUNICIPAL BOND FUND
SUMMARY OF ABBREVIATIONS
<S> <C> <S> <C>
FGIC Financial Guaranty Insurance Corporation PCR Pollution Control Revenue
FHA Federal Housing Administration RRR Resource Recovery Revenue
FSA Financial Security Assurance SFHR Single Family Housing Revenue
HR Hospital Revenue SFMR Single Family Mortgage Revenue
IDB Industrial Development Board SWDR Solid Waste Disposal Revenue
IDR Industrial Development Revenue VRDN Variable Rate Demand Notes
LOC Letter of Credit
</TABLE>
<TABLE>
<CAPTION>
SUMMARY OF COMBINED RATINGS (UNAUDITED)
FITCH (F) OR MOODY'S OR STANDARD & POOR'S PERCENTAGE OF VALUE
- - --------- --------- -------------------- ----------------------
<S> <S> <S> <C>
AAA Aaa AAA 15.9%
AA Aa AA 9.5
A A A 22.5
BBB Baa BBB 34.2
BB Ba BB 2.4
F-1 MIGI, VMIG1 & P1 SP1 & A1 1.8
Not Rated (g) Not Rated (g) Not Rated (g) 13.7
--------
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 tax-exempt issue and to retire the bonds in full at the
earliest refunding date.
(b) Residual interest security - the interest rate is subject to change
periodically.
(c) 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 April 30,
1994, these securities amounted to $14,257,750 or 2.2% of net assets.
(d) Secured by letters of credit.
(e) Securities payable on demand. The interest rate, which is subject to
change, is based on bank prime rates or an index of market interest
rates.
(f) Fitch currently provides creditworthiness information for a limited
amount of investments.
(g) Securities which, while not rated by Fitch, Moody's or Standard &
Poor's, have been determined by the Fund's Board of Trustees to be of
comparable quality to those rated securities in which the Fund may
invest.
<TABLE>
<CAPTION>
STATEMENT OF PUT OPTIONS WRITTEN APRIL 30, 1994
CONTRACTS
SUBJECT TO
ISSUER PUT VALUE
- - ------ ---------- ---------
<S> <C> <C>
U.S. Treasury Notes:
June '94 @ $106......................................................... 200 $(250,000)
June '94 @ $107......................................................... 200 (387,500)
---------
(premiums received $296,552).......................................... $(637,500)
---------
---------
See notes to financial statements.
PREMIER MUNICIPAL BOND FUND
STATEMENT OF ASSETS AND LIABILITIES APRIL 30, 1994
ASSETS:
Investments in securities, at value
(cost $617,500,809)-see statement..................................... $623,684,661
Cash.................................................................... 4,099,668
Interest receivable..................................................... 14,134,626
Receivable for shares of Beneficial Interest subscribed................. 1,393,285
Prepaid expenses........................................................ 52,308
--------------
643,364,548
LIABILITIES:
Due to The Dreyfus Corporation.......................................... $460,521
Outstanding put options written, at value
(premiums received $296,552)-see statement............................ 637,500
Payable for shares of Beneficial Interest redeemed...................... 398,614
Accrued expenses........................................................ 188,279 1,684,914
---------- --------------
NET ASSETS ................................................................ $641,679,634
--------------
--------------
REPRESENTED BY:
Paid-in capital......................................................... $637,350,126
Accumulated net realized capital losses and distributions in excess of
net realized
gain on investments-Note 1(c)......................................... (1,513,396)
Accumulated net unrealized appreciation on investments-Note 3(b)........ 5,842,904
--------------
NET ASSETS at value......................................................... $641,679,634
--------------
--------------
Shares of Beneficial Interest outstanding:
Class A Shares
(unlimited number of $.001 par value shares authorized)............... 39,544,149
--------------
--------------
Class B Shares
(unlimited number of $.001 par value shares authorized)............... 6,924,450
--------------
--------------
NET ASSET VALUE per share:
Class A Shares
($546,036,245 / 39,544,149 shares).................................... $13.81
-------
-------
Class B Shares
($95,643,389 / 6,924,450 shares)...................................... $13.81
-------
-------
See notes to financial statements.
PREMIER MUNICIPAL BOND FUND
STATEMENT OF OPERATIONS YEAR ENDED APRIL 30, 1994
INVESTMENT INCOME:
INTEREST INCOME......................................................... $ 43,891,883
EXPENSES:
Management fee-Note 2(a).............................................. $ 3,526,429
Shareholder servicing costs-Note 2(c)................................. 1,962,965
Distribution fees (Class B shares)-Note 2(b).......................... 324,814
Registration fees..................................................... 109,195
Prospectus and shareholders' reports.................................. 79,905
Custodian fees........................................................ 59,319
Professional fees..................................................... 55,345
Trustees' fees and expenses-Note 2(d)................................. 18,941
Miscellaneous......................................................... 48,901
-------------
6,185,814
Less-reduction in management fee due to
undertakings-Note 2(a)............................................ 399,146
-------------
TOTAL EXPENSES.................................................. 5,786,668
-------------
INVESTMENT INCOME-NET........................................... 38,105,215
REALIZED AND UNREALIZED (LOSS) ON INVESTMENTS:
Net realized (loss) on investments-Note 3(a)............................ $ (1,468,275)
Net unrealized (depreciation) on investments............................ (29,828,947)
-------------
NET REALIZED AND UNREALIZED (LOSS) ON INVESTMENTS............... (31,297,222)
-------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........................ $ 6,807,993
-------------
-------------
See notes to financial statements.
PREMIER MUNICIPAL BOND FUND
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED APRIL 30,
--------------------------------
1993 1994
--------------- -------------
OPERATIONS:
Investment income-net................................................... $ 29,484,374 $ 38,105,215
Net realized gain (loss) on investments................................. 5,305,331 (1,468,275)
Net unrealized appreciation (depreciation) on investments for the year.. 23,331,904 (29,828,947)
--------------- -------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS.............. 58,121,609 6,807,993
--------------- -------------
DIVIDENDS TO SHAREHOLDERS FROM:
Investment income-net:
Class A shares........................................................ (29,366,677) (34,640,947)
Class B shares........................................................ (117,697) (3,464,268)
Net realized gain on investments:
Class A shares........................................................ (6,801,408) (1,935,559)
Class B shares........................................................ --- (249,175)
Excess net realized gain on investments:
Class A shares........................................................ --- (39,975)
Class B shares........................................................ --- (5,146)
--------------- -------------
TOTAL DIVIDENDS................................................... (36,285,782) (40,335,070)
--------------- -------------
BENEFICIAL INTEREST TRANSACTIONS:
Net proceeds from shares sold:
Class A shares........................................................ 148,668,994 104,748,904
Class B shares........................................................ 19,857,135 83,821,633
Dividends reinvested:
Class A shares........................................................ 22,354,888 22,085,600
Class B shares........................................................ 64,777 2,282,208
Cost of shares redeemed:
Class A shares........................................................ (55,003,691) (80,102,730)
Class B shares........................................................ (109,103) (4,090,771)
--------------- -------------
INCREASE IN NET ASSETS FROM BENEFICIAL INTEREST TRANSACTIONS...... 135,833,000 128,744,844
--------------- -------------
TOTAL INCREASE IN NET ASSETS.................................... 157,668,827 95,217,767
NET ASSETS:
Beginning of year....................................................... 388,793,040 546,461,867
--------------- -------------
End of year............................................................. $546,461,867 $641,679,634
--------------- -------------
--------------- -------------
</TABLE>
<TABLE>
<CAPTION>
SHARES
----------------------------------------------------------------------------
CLASS A CLASS B
---------------------------------- ----------------------------------
YEAR ENDED APRIL 30, YEAR ENDED APRIL 30,
---------------------------------- ----------------------------------
1993 1994 1993* 1994
--------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
CAPITAL SHARE TRANSACTIONS:
Shares sold......................... 10,464,001 7,100,350 1,376,724 5,676,601
Shares issued for dividends reinvested 1,577,117 1,502,278 4,490 155,727
Shares redeemed..................... (3,868,910) (5,500,645) (7,565) (281,527)
--------------- --------------- --------------- ---------------
NET INCREASE IN SHARES OUTSTANDING 8,172,208 3,101,983 1,373,649 5,550,801
--------------- --------------- --------------- ---------------
--------------- --------------- --------------- ---------------
- - -----------------------
* From January 15, 1993 (commencement of initial offering) to April 30, 1993.
See notes to financial statements.
</TABLE>
PREMIER MUNICIPAL BOND FUND
FINANCIAL HIGHLIGHTS
Contained below is per share operating performance data for a share of
Beneficial Interest outstanding, total investment return, ratios to average
net assets and other supplemental data for each year indicated. This
information has been derived from information provided in the Fund's
financial statements.
<TABLE>
<CAPTION>
CLASS A SHARES CLASS B SHARES
----------------------------------------------- ---------------------
YEAR ENDED APRIL 30, YEAR ENDED APRIL 30,
----------------------------------------------- ---------------------
PER SHARE DATA: 1990 1991 1992 1993 1994 1993(1) 1994
------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of year.... $12.97 $12.77 $13.28 $13.75 $14.45 $14.02 $14.45
------- ------- ------- ------- ------- ------- -------
INVESTMENT OPERATIONS:
Investment income-net................. .99 .98 .94 .92 .89 .24 .80
Net realized and unrealized gain
(loss) on investments............... (.20) .51 .49 .91 (.59) .43 (.59)
------- ------- ------- ------- ------- ------- -------
TOTAL FROM INVESTMENT OPERATIONS .79 1.49 1.43 1.83 .30 .67 .21
------- ------- ------- ------- ------- ------- -------
DISTRIBUTIONS:
Dividends from investment income-net.. (.99) (.98) (.94) (.92) (.89) (.24) (.80)
Dividends from net realized
gain on investments................. -- -- (.02) (.21) (.05) -- (.05)
Dividends from excess net realized
gain on investments................. -- -- -- -- -- -- --
------- ------- ------- ------- ------- ------- -------
TOTAL DISTRIBUTIONS............. (.99) (.98) (.96) (1.13) (.94) (.24) (.85)
------- ------- ------- ------- ------- ------- -------
Net asset value, end of year.......... $12.77 $13.28 $13.75 $14.45 $13.81 $14.45 $13.81
------- ------- ------- ------- ------- ------- -------
------- ------- ------- ------- ------- ------- -------
TOTAL INVESTMENT RETURN(2) 6.25% 12.13% 11.08% 13.76% 1.84% 16.80%(3) 1.26%
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets -- .22% .54% .74% .85% 1.15%(3) 1.40%
Ratio of net investment income to
average net assets.................. 7.51% 7.43% 6.90% 6.43% 6.01% 5.13%(3) 5.33%
Decrease reflected in above expense ratios due
to undertakings by the Manager ..... 1.15% .82% .40% .20% .06% .10%(3) .05%
Portfolio Turnover Rate............... 63.53% 41.30% 50.72% 30.99% 22.15% 30.99% 22.15%
Net Assets, end of year (000's Omitted) $100,784 $247,195 $388,793 $526,606 $546,036 $19,855 $95,643
- - ----------------------------
(1) From January 15, 1993 (commencement of initial offering) to April 30, 1993.
(2) Exclusive of sales load.
(3) Annualized.
See notes to financial statements.
</TABLE>
PREMIER MUNICIPAL BOND FUND
NOTES TO FINANCIAL STATEMENTS
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES:
The Fund is registered under the Investment Company Act of 1940 ("Act")
as a diversified open-end management investment company. Dreyfus Service
Corporation ("Distributor") acts as the distributor of the Fund's shares. The
Distributor is a wholly-owned subsidiary of The Dreyfus Corporation
("Manager").
The Fund offers both Class A and Class B shares. Class A shares are
subject to a sales charge imposed at the time of purchase and Class B shares
are subject to a contingent deferred sales charge imposed at the time of
redemption on redemptions made within five years of purchase. Other
differences between the two Classes include the services offered to and the
expenses borne by each Class and certain voting rights.
(A) PORTFOLIO VALUATION: The Fund's investments (excluding options and
financial futures on municipal and U.S. treasury securities) are valued each
business day by an independent pricing service ("Service") approved by the
Board of Trustees. Investments for which quoted bid prices in the judgment of
the Service are readily available and are representative of the bid side of
the market 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. Options and financial
futures on municipal and U.S. treasury securities are valued at the last
sales price on the securities exchange on which such securities are primarily
traded or at the last sales price on the national securities market on each
business day. Investments not listed on an exchange or the national
securities market, or securities for which there were no transactions, are
valued at the average of the most recent bid and asked prices. Bid price is
used when no asked price is available.
(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, when appropriate,
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, if any, it is the policy of the Fund not to distribute such gain.
Dividends in excess of net realized gains on investments for financial
statement purposes result from current period wash sale loss deferrals to be
recognized in future years and other losses from security transactions during
the year ended April 30, 1994 which are treated for Federal income tax
purposes as arising in fiscal 1995.
(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 provisions available to certain investment
companies, as defined in applicable sections of the Internal Revenue Code,
and to make distributions of income and net realized capital gain sufficient
to relieve it from all, or substantially all, Federal income taxes.
PREMIER MUNICIPAL BOND FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
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 .55 of 1% of the average
daily value of the Fund's net assets and is payable monthly. 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 the expense limitation of any state having
jurisdiction over the Fund for any full fiscal year. However, the Manager had
undertaken from May 1, 1993 through January 18, 1994 to reduce the management
fee paid by the Fund, to the extent that the Fund's aggregate expenses
(excluding certain expenses as described above) exceeded specified annual
percentages of the Fund's average daily net assets. The reduction in
management fee, pursuant to the undertakings, amounted to $399,146 for the
year ended April 30, 1994.
The Distributor retained $213,752 during the year ended April 30, 1994
from commissions earned on sales of the Fund's Class A shares.
The Distributor retained $91,986 during the year ended April 30, 1994
from contingent deferred sales charges imposed upon redemptions of the Fund's
Class B shares.
(B) Under the Distribution Plan ("Class B Distribution Plan") adopted
pursuant to Rule 12b-1 under the Act, the Fund pays the Distributor, at an
annual rate of .50 of 1% of the value of the Fund's Class B shares average
daily net assets, for costs and expenses in connection with advertising,
marketing and distributing the Fund's Class B shares. The Distributor may
make payments to one or more Service Agents (a securities dealer, financial
institution, or other industry professional) based on the value of the Fund's
Class B shares owned by clients of the Service Agent. During the year ended
April 30, 1994, $324,814 was charged to the Fund pursuant to the Class B
Distribution Plan.
(C) Under the Shareholder Services Plan, the Fund pays the Distributor,
at an annual rate of .25 of 1% of the value of the average daily net assets
of Class A and Class B shares for servicing 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. The Distributor may make payments to
Service Agents in respect of these services. The Distributor determines the
amounts to be paid to Service Agents. For the year ended April 30, 1994,
$1,440,515 and $162,407 were charged to the Class A and Class B shares,
respectively, pursuant to the Shareholder Services Plan.
(D) Certain officers and trustees of the Fund are "affiliated persons,"
as defined in the Act, of the Manager and/or the Distributor. Each trustee
who is not an "affiliated person" receives from the Fund an annual fee of
$2,500 and an attendance fee of $250 per meeting.
(E) On December 5, 1993, the Manager entered into an Agreement and Plan
of Merger (the "Merger Agreement") providing for the merger of the Manager
with a subsidiary of Mellon Bank Corporation ("Mellon").
Following the merger, it is planned that the Manager will be a direct
subsidiary of Mellon Bank, N.A. Closing of this merger is subject to a number
of contingencies, including receipt of certain regulatory approvals and
approvals of the stockholders of the Manager and of Mellon. The merger is
expected to occur in mid-1994, but could occur later.
PREMIER MUNICIPAL BOND FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
As a result of regulatory requirements and the terms of the Merger
Agreement, the Manager will seek various approvals from the Fund's board and
shareholders before completion of the merger. Shareholder approval will be
solicited by a proxy statement.
NOTE 3-SECURITIES TRANSACTIONS:
(A) Purchases and sales of securities, excluding option transactions,
amounted to $292,478,175 and $168,116,003, respectively, for the year ended
April 30, 1994, and consisted entirely of municipal bonds and short-term
municipal investments.
In addition, the following table summarizes the Fund's put options
written transactions for the year ended April 30, 1994:
<TABLE>
<CAPTION>
NUMBER OF PREMIUMS
CONTRACTS RECEIVED
------------- ------------
<S> <C> <C>
OPTIONS WRITTEN:
Contracts outstanding April 30, 1993......... - -
Contracts Written............................ 400 $296,552
---- ------------
Contracts outstanding April 30, 1994......... 400 $296,552
---- ------------
---- ------------
</TABLE>
As a writer of put options, the Fund receives a premium at the outset
and then bears the market risk of unfavorable changes in the price of the
financial instrument underlying the option. Generally, the Fund would incur
a loss if the price of the underlying financial instrument declines between
the date the option is written and the date on which the option is terminated.
Generally, the Fund would realize a gain, to the extent of the premiums, if
the price of the financial instrument increases between those dates.
(B) At April 30, 1994, accumulated net unrealized appreciation on
investments was $5,842,904, consisting of $24,571,806 gross unrealized
appreciation and $18,728,902 gross unrealized depreciation.
At April 30, 1994, 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).
PREMIER MUNICIPAL BOND FUND
REPORT OF ERNST & YOUNG, INDEPENDENT AUDITORS
SHAREHOLDERS AND BOARD OF TRUSTEES
PREMIER MUNICIPAL BOND FUND
We have audited the accompanying statement of assets and liabilities of
Premier Municipal Bond Fund, including the statements of investments and put
options written, as of April 30, 1994, and the related statement of
operations for the year then ended, the statement of changes in net assets
for each of the two years in the period then ended, and financial highlights
for each of the years indicated therein. These financial statements and
financial highlights are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. Our procedures included confirmation of
securities owned as of April 30, 1994 by correspondence with the custodian
and brokers. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audits provide
a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the financial
position of Premier Municipal Bond Fund at April 30, 1994, the results of its
operations for the year then ended, the changes in its net assets for each of
the two years in the period then ended, and the financial highlights for each
of the indicated years, in conformity with generally accepted accounting
principles.
(Ernst and Young Signature Logo)
New York, New York
June 3, 1994
PREMIER MUNICIPAL BOND FUND
IMPORTANT TAX INFORMATION (UNAUDITED)
In accordance with Federal tax law, the Fund hereby makes the following
designations regarding its fiscal year ended April 30, 1994:
-- All the dividends paid from investment income-net are
"exempt-interest dividends" (not generally subject to regular Federal
income tax).
-- The $.0496 per share paid by the Fund on December 6, 1993
represents a long-term capital gain distribution. As required by Federal
tax law rules, shareholders will receive notification of their portion of
the Fund's taxable ordinary dividends (if any) and capital gain
distributions (if any) paid for the 1994 calendar year on Form 1099-DIV
which will be mailed by January 31, 1995.
ANNUAL REPORT
PREMIER
MUNICIPAL BOND FUND
APRIL 30, 1994
(Dreyfus Lion Logo)
PREMIER MUNICIPAL
BOND FUND
144 Glenn Curtiss Boulevard
Uniondale, NY 11556
MANAGER
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
DISTRIBUTOR
Dreyfus Service Corporation
200 Park Avenue
New York, NY 10166
CUSTODIAN
The Bank of New York
110 Washington Street
New York, NY 10286
TRANSFER AGENT &
DIVIDEND DISBURSING AGENT
The Shareholder Services Group, Inc.
P.O. Box 9671
Providence, RI 02940
Further information is contained in the Prospectus,
which must precede or accompany this report.
Printed in U.S.A. 022/612AR944
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT
IN PREMIER MUNICIPAL BOND FUND CLASS A SHARES
AND THE LEHMAN BROTHERS MUNICIPAL BOND INDEX
EXHIBIT A:
_______________________________________________
| | | |
| | | PREMIER |
| PERIOD | LEHMAN BROTHERS | MUNICIPAL |
| | MUNICIPAL | BOND FUND, |
| | BOND INDEX * | CLASS A |
|-----------|-----------------|----------------|
| 11/26/86 | 10,000 | 9,550 |
| 4/30/87 | 9,701 | 9,025 |
| 4/30/88 | 10,550 | 9,353 |
| 4/30/89 | 11,492 | 10,674 |
| 4/30/90 | 12,320 | 11,341 |
| 4/30/91 | 13,735 | 12,716 |
| 4/30/92 | 15,041 | 14,126 |
| 4/30/93 | 16,944 | 16,070 |
| 4/30/94 | 17,310 | 16,366 |
|----------------------------------------------|
