DREYFUS PREMIER MUNICIPAL BOND FUND
LETTER TO SHAREHOLDERS
Dear Shareholder:
We are pleased to report the performance for the Dreyfus Premier
Municipal Bond Fund for the six-month period ended October 31, 1997 as shown
in the following table:
<TABLE>
<CAPTION>
Annualized
Total Return* Distribution Rate**
___________ ________________
<S> <C> <C>
Class A Shares......................... 7.11% 5.20%
Class B Shares......................... 6.84% 4.94%
Class C Shares......................... 6.78% 4.72%
</TABLE>
Economic Review
With the level of inflation as low as it has been seen since 1964 and
unemployment still near a 23-year low, the economy continued its solid growth
over the reporting period. Gross Domestic Product (the "GDP") - the dollar
total of all goods and services produced in the United States - has grown in
excess of 3% for each of the past four quarters, a level and consistency of
gain unmatched since 1984. This extraordinary economic performance has been
fueled by huge business investment in new plant and equipment as well as a
renewed surge in consumer spending over the summer. Consumers play a
substantial role in determining the course of the economy since their
spending accounts for two thirds of all economic activity. Retail sales rose
through the summer and into September, although there was some sign of
deceleration as the third quarter progressed.
The big economic story continued to be the lack of inflation in an
economy now in its seventh year of expansion. This remarkable price
stability, at a time in the business cycle when inflationary pressures would
usually be apparent, has enabled the Federal Reserve Board (the "Fed") to
refrain from tightening monetary policy. The Federal Open Market Committee
(the "FOMC"), the policy-making arm of the Fed, has raised interest rates
just once in over two years, a period roughly coinciding with the surge of
growth in the economy. The last increase in short-term interest rates came on
March 25, 1997, when the FOMC increased the Federal Funds rate by a modest
one-quarter of a percentage point to 5.50%. (The Federal Funds rate is the
rate of interest that banks charge one another for overnight loans.)
Of course, the recent financial market turbulence arising from currency
devaluations in some of the economically weaker Southeast Asian countries has
added a cautionary note to any Fed monetary actions that might further roil
investment markets. The Southeast Asian economies have been cooling or in
outright recession for some time and represent a large share of the global
economy and the U.S. import/export market. The recent crisis has boosted the
value of the U.S. dollar and could further dampen the demand for U.S. exports
to this region. This bodes well for continued low inflation in the U.S. and
weakens the argument that we are on the brink of price acceleration.
In fact, inflation remains in check. The Implicit Price Deflator, an
indicator of inflation that measures the prices of all goods and services in
the U.S., has risen at an annual rate of less than 2% for the past two
quarters. This favorable trend in prices has been mirrored by both the
Consumer Price Index (a measure of the average change in the prices paid by
urban consumers for a fixed market basket of goods and services) and the
Producer Price Index (a measure of the average change in the prices of all
commodities, at all stages of processing, produced for sale in primary
markets in the United States). The Labor Department's Employment Cost Index,
a broad measure of changes in wages and benefits, has indicated relatively
modest increases in labor costs. Still, the labor market remains tight, with
the unemployment rate at a low level unmatched in 23 years.
Whether the economy will slow without further monetary restraint by the
Fed remains an open question. Industrial production has been strong and
operating rates, an indicator of possible future price pressures, have edged
to their highest level in two years. Of paramount concern to Fed Chairman
Alan Greenspan is the possibility of continuing economic
growth so strong that the unemployment rate is driven even lower, and a
subsequent corresponding upsurge in wage rates reignites inflation. The
performance of the economy over the coming months appears crucial in
determining whether the Fed will actively restrain the economy. We remain
alert to changes in economic trends that would increase the risk of rising
inflation and, consequently, the prospect of higher interest rates.
Market Environment
Renewed concerns regarding Asia and Latin America have resulted in an
international flight to quality and projections of the U.S. economy slowing
down due to diminished exports. In U.S. fixed income securities, these
consequences have raised prices, an appreciation from already high price
levels, and further lowered yield levels. The timing comes on the heels of
many strong recent economic indicators, especially on employment and housing,
that show signs of potential inflation that could push market prices lower.
These strong opposing forces have generated a potential dilemma for bond
market participants. With only potential evidence of weakness in the
economy, the 30-year Treasury bond's yield has been pushed to the 6.10%
level. Participants must now decide if they should position themselves for a
run below 6%. More importantly, the question arises whether a new level of
interest rates is sustainable from global currency devaluation and foreign
economic weakness alone. Anticipated information on U.S. wage pressures and
retail sales should provide needed conviction to many participants'
sentiments.
The Portfolio
While global forces have recently gripped the fundamental market
direction, new issuance has also reemerged as the dominant technical market
force in the municipal arena. Lower yield levels have encouraged many
municipal authorities to issue new debt or refinance older, higher cost debt.
Despite the increase in supply, most issues are absorbed with relative ease.
In the Fund, many existing holdings have become premium bonds (evaluated
above par) due to appreciation. Our investment approach has concentrated on
longer intermediate (15-18 years) paper or other bonds that are expected to
perform in a similar manner. We continue to focus on shortening maturities
and lengthening call features to influence bond selection. Additionally, we
have added some income oriented securities. If rates stabilize in the
current ranges, we feel that higher income paper should perform well and be
defensive against discount alternatives.
Very truly yours,
[Richard J. Moynihan signature logo]
Richard J. Moynihan
Director, Municipal Portfolio Management
The Dreyfus Corporation
November 18, 1997
New York, N.Y.
* Total return includes reinvestment of dividends and any capital gains
paid, and does not take into consideration the maximum initial sales charge
in the case of Class A shares or the contingent deferred sales charge imposed
on redemptions in the case of Class B shares and Class C shares.
** Distribution rate per share is based upon dividends per share paid from
net investment income during the period (annualized), divided by the maximum
offering price at the end of the period in the case of Class A shares, or the
net asset value per share in the case of Class B shares and Class C shares.
Some income may be subject to the Federal Alternative Minimum Tax (AMT) for
certain shareholders.
<TABLE>
<CAPTION>
DREYFUS PREMIER MUNICIPAL BOND FUND
STATEMENT OF INVESTMENTS OCTOBER 31, 1997 (UNAUDITED)
Principal
Long-Term Municipal Investments-99.4% Amount Value
_______ _______
<S> <C> <C>
Alabama-.5%
Mobile Industrial Development Board, SWDR, Refunding
(Mobile Energy Services Co. Project) 6.95%, 1/1/2020...................... $ 2,500,000 $ 2,744,400
Arizona-1.8%
Maricopa County Pollution Control Corporation, PCR, Refunding
(Public Service Co.-New Mexico Project) 6.30%, 12/1/2026.................. 5,000,000 5,273,150
Pima County Industrial Development Authority, Industrial Revenue
(Tucson Electric Power Company) 6.10%, 9/1/2025........................... 5,000,000 5,059,300
California-3.3%
Foothill/Eastern Transportation Corridor Agency, Toll Road Revenue:
6%, 1/1/2034.............................................................. 5,000,000 5,177,650
5%, 1/1/2035.............................................................. 8,000,000 7,298,560
San Joaquin Hills Transportation Corridor Agency, Toll Road Revenue
(Senior Lien) 5%, 1/1/2033................................................ 6,500,000 6,005,740
Colorado-9.2%
Arapahoe County Capital Improvement Trust Fund, Highway Revenue (E-470
Project):
Zero Coupon, 8/31/2005.................................................... 2,530,000 1,780,589
Zero Coupon, 8/31/2007 (Prerefunded 8/31/2005) (a)........................ 4,000,000 2,512,240
7%, 8/31/2026 (Prerefunded 8/31/2005) (a)................................. 11,000,000 13,042,700
Dawson Ridge, Metropolitan District Number 1, Refunding:
Zero Coupon, 10/1/2017.................................................... 9,930,000 3,409,466
Zero Coupon, 10/1/2022.................................................... 47,535,000 12,479,839
Denver City and County, Airport Revenue:
7.50%, 11/15/2023 (Prerefunded 11/15/2004) (a)............................ 2,060,000 2,462,833
7.50%, 11/15/2023......................................................... 9,715,000 11,153,111
7%, 11/15/2025 (Prerefunded 11/15/2001) (a)............................... 820,000 903,345
7%, 11/15/2025............................................................ 3,405,000 3,670,522
Connecticut-1.2%
Connecticut Development Authority, First Mortgage Gross Revenue
(Elim Park Baptist Home, Inc. Project) 9%, 12/1/2020...................... 3,000,000 3,220,980
Mashantucket Western Pequot Tribe, Special Revenue 5.75%, 9/1/2018.......... 3,700,000 3,756,832
Delaware-.7%
Delaware Housing Authority, MFMR 7%, 5/1/2025............................... 3,725,000 3,925,628
Florida-3.9%
Lee County Industrial Development Authority, Health Care Facilities Revenue
(Cypress Cove Health Park):
5.625%, 10/1/2002....................................................... 2,000,000 2,003,720
5.875%, 10/1/2004....................................................... 2,000,000 2,008,340
6.25%, 10/1/2017........................................................ 3,000,000 3,050,250
6.375%, 10/1/2025....................................................... 4,500,000 4,598,460
DREYFUS PREMIER MUNICIPAL BOND FUND
STATEMENT OF INVESTMENTS (CONTINUED) OCTOBER 31, 1997 (UNAUDITED)
Principal
Long-Term Municipal Investments (continued) Amount Value
_______ _______
Florida (continued)
Palm Beach County, Solid Waste IDR:
(Okeelanta Power LP Project) 6.85%, 2/15/2021 (b)......................... $ 6,750,000 $ 3,408,750
(Osceola Power LP) 6.95%, 1/1/2022 (b).................................... 7,500,000 3,750,000
Santa Rosa Bay Bridge Authority, Revenue 6.25%, 7/1/2028.................... 3,000,000 3,144,900
Illinois-8.5%
Carol Stream, First Mortgage Revenue, Refunding
(Windsor Park Manor Project) 6.50%, 12/1/2007............................. 2,000,000 2,045,700
Chicago O'Hare International Airport, Special Facility Revenue
(American Airlines, Inc. Project) 7.875%, 11/1/2025....................... 6,000,000 6,592,680
Illinois Development Finance Authority, Revenue
(Community Rehabilitation Providers Facility):
8.75%, 3/1/2010 (Prerefunded 3/1/1999) (a).............................. 6,128,000 6,613,705
8.75%, 3/1/2010......................................................... 422,000 449,261
8.50%, 9/1/2010 (Prerefunded 9/1/2000) (a).............................. 2,985,000 3,376,423
8.50%, 9/1/2010......................................................... 1,550,000 1,659,461
8.25%, 8/1/2012......................................................... 3,935,000 4,188,689
Illinois Health Facilities Authority, Revenue (Beverly Farm Foundation)
9.125%, 12/15/2015 (Prerefunded 12/15/2000) (a)........................... 2,000,000 2,336,080
Robbins, RRR (Robbins Resource Recovery Partners) 8.375%, 10/15/2016........ 19,500,000 20,534,865
Indiana-7.0%
East Chicago, PCR, Refunding:
(Inland Steel Co., Project Number 10) 6.80%, 6/1/2013..................... 7,000,000 7,538,860
(Inland Steel Co., Project Number 11) 7.125%, 6/1/2007.................... 3,000,000 3,385,410
Indiana Development Finance Authority:
Environmental Improvement Revenue, Refunding (USX Corp. Project):
6.15%, 7/15/2022........................................................ 4,000,000 4,182,240
6.25%, 7/15/2030........................................................ 2,500,000 2,635,775
Exempt Facilities Revenue, Refunding (Inland Steel) 5.75%, 10/1/2011...... 8,500,000 8,604,380
PCR, Refunding (Inland Steel Co., Project Number 12) 6.85%, 12/1/2012..... 4,000,000 4,360,480
Indianapolis Airport Authority, Special Facilities Revenue
(Federal Express Corp. Project) 7.10%, 1/15/2017.......................... 7,500,000 8,422,650
Kentucky-2.2%
Kentucky Economic Development Finance Authority,
Hospital System Improvement Revenue, Refunding
(Appalachian Regional Health Center) 5.85%, 10/1/2017 (c)................. 6,000,000 6,010,140
Perry County, SWDR (TJ International Project):
7%, 6/1/2024.............................................................. 3,500,000 3,806,075
6.55%, 4/15/2027.......................................................... 2,500,000 2,688,875
Louisiana-2.4%
Louisiana Housing Finance Agency, MFHR, Refunding
(LaBelle Projects) 9.75%, 10/1/2020....................................... 4,200,000 4,324,194
DREYFUS PREMIER MUNICIPAL BOND FUND
STATEMENT OF INVESTMENTS (CONTINUED) OCTOBER 31, 1997 (UNAUDITED)
Principal
Long-Term Municipal Investments (continued) Amount Value
_______ _______
Louisiana (continued)
Louisiana Public Facilities Authority, Student Loan Revenue
7%, 9/1/2006.............................................................. $ 1,900,000 $ 2,031,841
Parish of West Feliciana, PCR (Gulf States Utilities-III) 7.70%, 12/1/2014.. 6,500,000 7,303,855
Maryland-.6%
Maryland Energy Financing Administration, SWDR
(Wheelabrator Water Projects) 6.45%, 12/1/2016............................ 3,000,000 3,278,760
Massachusetts-.5%
Massachusetts Industrial Finance Agency, Water Treatment Revenue
(American Hingham) 6.95%, 12/1/2035....................................... 2,640,000 2,876,650
Michigan-1.3%
Wayne Charter County, Special Airport Facilities Revenue, Refunding
(Northwest Airlines, Inc.) 6.75%, 12/1/2015............................... 5,000,000 5,466,250
Wayne County Building Authority 8%, 3/1/2017 (Prerefunded 3/1/2002) (a)..... 1,500,000 1,741,140
Nevada-2.6%
Clark County, IDR (Southwest Gas Corp.) 7.50%, 9/1/2032..................... 13,000,000 14,512,290
New Jersey-6.2%
Camden County Pollution Control Financing Authority, Solid Waste RRR
7.50%, 12/1/2010.......................................................... 2,000,000 2,035,340
New Jersey Economic Development Authority, First Mortgage Gross Revenue
(The Evergreens) 9.25%, 10/1/2022 (Prerefunded 10/1/2002) (a)............. 15,000,000 18,568,800
New Jersey Sports and Exposition Authority, Revenue, Refunding
(Monmouth Park) 8%, 1/1/2025.............................................. 4,000,000 4,508,320
Union County Utilities Authority, Solid Waste Revenue 7.20%, 6/15/2014...... 9,500,000 9,723,250
New Mexico-1.5%
Farmington, PCR:
Refunding (Public Service Co.-San Juan Project) 6.375%, 4/1/2022.......... 5,000,000 5,323,350
(Tucson Electric Power Company of San Juan) 6.95%, 10/1/2020.............. 3,000,000 3,329,760
New York-9.2%
New York City:
7.10%, 2/1/2009 (Prerefunded 2/1/2002) (a)................................ 4,355,000 4,884,481
7.10%, 2/1/2009........................................................... 645,000 708,223
7%, 2/1/2020.............................................................. 10,000,000 10,942,200
6.625%, 2/15/2025......................................................... 7,000,000 7,753,970
New York State Energy Research and Development Authority,
Electric Facilities Revenue (Long Island Lighting Co.):
7.15%, 9/1/2019......................................................... 3,650,000 3,969,667
7.15%, 6/1/2020......................................................... 4,000,000 4,350,320
7.15%, 12/1/2020........................................................ 5,000,000 5,437,900
7.15%, 2/1/2022......................................................... 7,500,000 8,156,850
New York State Housing Finance Agency, Service Contract Obligation Revenue
7.30%, 3/15/2021 (Prerefunded 9/15/2001) (a).............................. 5,000,000 5,636,300
DREYFUS PREMIER MUNICIPAL BOND FUND
STATEMENT OF INVESTMENTS (CONTINUED) OCTOBER 31, 1997 (UNAUDITED)
Principal
Long-Term Municipal Investments (continued) Amount Value
_______ _______
North Carolina-2.7%
North Carolina Eastern Municipal Power Agency, Power System Revenue, Refunding:
7%, 1/1/2013.............................................................. $ 3,500,000 $ 3,969,000
6%, 1/1/2014.............................................................. 6,750,000 6,991,515
5%, 1/1/2021.............................................................. 4,625,000 4,227,759
Ohio-1.5%
Ohio Water Development Authority, Pollution Control Facilites Revenue,
Refunding
(Cleveland Electric) 6.10%, 8/1/2020...................................... 8,500,000 8,688,700
Oklahoma-1.3%
Holdenville Industrial Authority, Correctional Facility Revenue:
6.60%, 7/1/2010........................................................... 2,045,000 2,203,958
6.70%, 7/1/2015........................................................... 4,625,000 4,990,375
Pennsylvania-6.5%
Beaver County Industrial Development Authority, PCR, Refunding 7.75%, 7/15/2025 6,000,000 6,882,180
Blair County Hospital Authority, Revenue (Altoona Hospital)
7.49%, 7/1/2013 (Insured; AMBAC) (d)...................................... 5,000,000 5,705,150
Delaware County Industrial Development Authority, Revenue, Refunding
(Resource Recovery Facility) 6.20%, 7/1/2019.............................. 5,000,000 5,329,900
Lancaster County Hospital Authority, Revenue (Health Center-United Church
Homes Project) 9.125%, 10/1/2014 (Prerefunded 10/1/1999) (a).............. 1,465,000 1,625,549
Lehigh County General Purpose Authority, Revenue (Wiley House):
8.75%, 11/1/2014.......................................................... 2,000,000 2,094,180
9.50%, 11/1/2016.......................................................... 3,000,000 3,287,940
Montgomery County Higher Education and Health Authority, First Mortgage
Revenue
(AHF/Montgomery, Inc. Project) 10.50%, 9/1/2020........................... 3,445,000 3,748,849
Pennsylvania Intergovernmental Cooperative Authority, Special Tax Revenue
(Philadelphia Funding Program) 6.80%, 6/15/2022 (Prerefunded 6/15/2002) (a) 2,000,000 2,212,300
Philadelphia, Water and Sewer Revenue 7.35%, 9/1/2004....................... 4,920,000 5,686,192
Rhode Island-.6%
Providence, Special Obligation Tax Increment 6.65%, 6/1/2016................ 3,000,000 3,211,650
Tennessee-1.1%
Shelby County Health Educational and Housing Facilities,
Multi-Family Housing Board Revenue (Cameron Kirby):
5.90%, 7/1/2018......................................................... 3,000,000 3,027,420
7.25%, 7/1/2023......................................................... 3,100,000 3,123,808
Texas-13.5%
Alliance Airport Authority, Special Facilities Revenue:
(American Airlines, Inc. Project) 7%, 12/1/2011........................... 10,700,000 12,500,168
(Federal Express Corp. Project) 6.375%, 4/1/2021.......................... 5,000,000 5,326,800
DREYFUS PREMIER MUNICIPAL BOND FUND
STATEMENT OF INVESTMENTS (CONTINUED) OCTOBER 31, 1997 (UNAUDITED)
Principal
Long-Term Municipal Investments (continued) Amount Value
_______ _______
Texas (continued)
Dallas-Fort Worth International Airport Facility, Improvement Revenue:
(American Airlines, Inc.) 7.50%, 11/1/2025................................ $ 8,000,000 $ 8,707,520
(Delta Airlines, Inc.) 7.125%, 11/1/2026.................................. 4,200,000 4,504,248
Gulf Coast Waste Disposal Authority, Revenue
(Champion International Corp.) 7.45%, 5/1/2026............................ 7,000,000 7,732,900
Houston Airport System, Special Facilities Improvement Revenue
(Continental Airline Terminal):
6.125%, 7/15/2017 (Guaranteed; Continental Airline Inc.)................ 8,375,000 8,661,928
6.125%, 7/15/2027 (Guaranteed; Continental Airline Inc.)................ 6,800,000 7,017,600
Lower Colorado River Authority, PCR (Samsung Austin Semiconductor)
6.375%, 4/1/2027 (Guaranteed; Samsung Electronics Co. LTD.)............... 5,000,000 5,319,000
Rio Grande City Consolidated Independent School District, Public Facilities
Corp. LR
6.75%, 7/15/2010.......................................................... 6,000,000 6,453,900
Texas Public Property Finance Corp., Revenue (Mental Health and Retardation
Center)
8.20%, 10/1/2012 (Prerefunded 10/1/2002) (a).............................. 8,005,000 9,400,191
Utah-3.0%
Carbon County, SWDR, Refunding:
(East Carbon Development Corp.) 9%, 7/1/2012.............................. 4,000,000 4,261,760
(Laidlaw Inc./ECDC Project) 7.50%, 2/1/2010............................... 3,300,000 3,786,387
(Sunnyside Cogeneration) 9.25%, 7/1/2018 (b).............................. 15,000,000 9,000,000
West Virginia-1.4%
Upshur County, SWDR (TJ International Project) 7%, 7/15/2025................ 7,000,000 7,676,410
U.S. Related-5.2%
Puerto Rico Commonwealth:
Public Improvement 6.50%, 7/1/2014 (Insured; MBIA)........................ 5,000,000 5,831,600
Refunding:
6.25%, 7/1/2013 (Insured; MBIA)......................................... 3,000,000 3,416,100
6%, 7/1/2014............................................................ 400,000 422,056
Puerto Rico Commonwealth Aqueduct and Sewer Authority, Revenue, Refunding
6.25%, 7/1/2013........................................................... 9,000,000 10,075,500
Puerto Rico Commonwealth Highway and Transportation Authority, Highway
Revenue
5%, 7/1/2036.............................................................. 5,000,000 4,722,750
Puerto Rico Electric Power Authority, Power Revenue 6.25%, 7/1/2017......... 520,000 554,252
Puerto Rico Telephone Authority, Revenue, Refunding
7.544%, 1/25/2007 (Insured; MBIA) (d)..................................... 3,950,000 4,280,813
_____________
TOTAL LONG-TERM MUNICIPAL INVESTMENTS
(cost $522,292,519)....................................................... $558,795,073
=============
DREYFUS PREMIER MUNICIPAL BOND FUND
STATEMENT OF INVESTMENTS (CONTINUED) OCTOBER 31, 1997 (UNAUDITED)
Principal
Short-Term Municipal Investments-.6% Amount Value
_______ _______
Florida-.4%
Jacksonville, PCR, Refunding, VRDN
(Florida Power and Light Company Project) 3.65% (e)....................... $ 2,300,000 $ 2,300,000
U.S. Related-.2%
Puerto Rico Commonwealth Government Development Bank, Refunding, VRDN
3.35% (LOC; Credit Suisse) (e,f).......................................... 1,000,000 1,000,000
_____________
TOTAL SHORT-TERM MUNICIPAL INVESTMENTS
(cost $3,300,000)......................................................... $ 3,300,000
=============
TOTAL INVESTMENTS-100.0%
(cost $525,592,519)....................................................... $ 562,095,073
=============
</TABLE>
<TABLE>
<CAPTION>
Summary of Abbreviations
<S> <C> <S> <C>
AMBAC American Municipal Bond Assurance Corporation MFHR Multi-Family Housing Revenue
IDR Industrial Development Revenue MFMR Multi-Family Mortgage Revenue
LOC Letter of Credit PCR Pollution Control Revenue
LR Lease Revenue RRR Resources Recovery Revenue
MBIA Municipal Bond Investors Assurance SWDR Solid Waste Disposal Revenue
Insurance Corporation VRDN Variable Rate Demand Notes
</TABLE>
<TABLE>
<CAPTION>
Summary of Combined Ratings
Fitch (g) or Moody's or Standard & Poor's Percentage of Value
_______ ________ __________________ ___________________
<S> <C> <C> <C>
AAA Aaa AAA 8.7%
A A A 13.0
BBB Baa BBB 34.6
BB Ba BB 16.9
B B B 1.4
F-1+ & F-1 MIG1, VMIG1 & P1 SP1 & A1 .6
Not Rated (h) Not Rated (h) Not Rated (h) 24.8
_____
100.0%
=====
</TABLE>
Notes to Statement of Investments:
(a) Bonds which are prerefunded are collateralized by U.S. Government
securities which are held in escrow and are used to pay principal
and interest on the municipal issue and to retire the bonds in full
at the earliest refunding date.
(b) Non-income producing security; interest
payment in default.
(c) Purchased on a delayed-delivery basis.
(d) Inverse floater security-the interest rate is subject to
change periodically.
(e) Security payable on demand. The interest rate,which is subject to
change, is based upon bank prime rates or an index of market
interest rates.
(f) Secured by letters of credit.
(g) Fitch currently provides creditworthiness information for a limited
number of investments.
(h) Securities which, while not rated by Fitch, Moody's and
Standard & Poor's have been determined by the Manager to be of
comparable quality to those rated securities in which the Fund
may invest.
SEE NOTES TO FINANCIAL STATEMENTS.
<TABLE>
<CAPTION>
DREYFUS PREMIER MUNICIPAL BOND FUND
STATEMENT OF ASSETS AND LIABILITIES OCTOBER 31, 1997 (UNAUDITED)
Cost Value
_____ _____
<S> <C> <C> <C>
ASSETS: Investments in securities-See Statement of Investments $525,592,519 $562,095,073
Interest receivable........................ 9,669,040
Receivable for investment securities sold.. 9,493,180
Receivable for shares of Beneficial Interest subscribed 168,474
Prepaid expenses........................... 13,231
____________
581,438,998
____________
LIABILITIES: Due to The Dreyfus Corporation and affiliates 282,625
Due to Distributor......................... 170,860
Payable for investment securities purchased 6,026,490
Payable for shares of Beneficial Interest redeemed 476,727
Accrued expenses and other liabilities..... 256,507
____________
7,213,209
____________
NET ASSETS.................................................................. $574,225,789
============
REPRESENTED BY: Paid-in capital............................ $534,127,344
Accumulated undistributed investment income-net 247,776
Accumulated net realized gain (loss) on investments 3,348,115
Accumulated net unrealized appreciation (depreciation)
on investments-Note 4..................... 36,502,554
____________
NET ASSETS.................................................................. $574,225,789
============
</TABLE>
<TABLE>
<CAPTION>
NET ASSET VALUE PER SHARE
_________________________
Class A Class B Class C
_______ _______ _______
<S> <C> <C> <C>
Net Assets.................................................. $455,563,069 $116,514,582 $2,148,138
Shares Outstanding.......................................... 30,992,831 7,924,850 145,960
NET ASSET VALUE PER SHARE................................... $14.70 $14.70 $14.72
====== ====== ======
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<TABLE>
<CAPTION>
DREYFUS PREMIER MUNICIPAL BOND FUND
STATEMENT OF OPERATIONS SIX MONTHS ENDED OCTOBER 31, 1997 (UNAUDITED)
INVESTMENT INCOME
<S> <C> <C> <C>
INCOME Interest Income............................ $18,809,555
EXPENSES: Management fee-Note 3(a)................... $ 1,581,594
Shareholder servicing costs-Note 3(c)...... 918,953
Distribution fees-Note 3(b)................ 291,874
Registration fees.......................... 37,583
Professional fees.......................... 30,700
Custodian fees............................. 27,363
Prospectus and shareholders' reports....... 19,075
Trustees' fees and expenses-Note 3(d)...... 16,852
Loan commitment fees-Note 2................ 3,658
Miscellaneous.............................. 14,087
____________
Total Expenses....................... 2,941,739
___________
INVESTMENT INCOME-NET....................................................... 15,867,816
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS-Note 4:
Net realized gain (loss) on investments.... $ 5,079,854
Net unrealized appreciation (depreciation) on investments 18,100,765
____________
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS...................... 23,180,619
____________
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........................ $39,048,435
============
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<TABLE>
<CAPTION>
DREYFUS PREMIER MUNICIPAL BOND FUND
STATEMENT OF CHANGES IN NET ASSETS
Six Months Ended
October 31, 1997 Year Ended
(Unaudited) April 30, 1997
________________ ______________
<S> <C> <C>
OPERATIONS:
Investment income-net.................................................... $ 15,867,816 $ 33,213,769
Net realized gain (loss) on investments.................................. 5,079,854 3,461,461
Net unrealized appreciation (depreciation) on investments................ 18,100,765 7,755,927
________________ ______________
Net Increase (Decrease) in Net Assets Resulting from Operations...... 39,048,435 44,431,157
________________ ______________
DIVIDENDS TO SHAREHOLDERS FROM:
Investment income-net:
Class A shares......................................................... (12,716,068) (27,382,313)
Class B shares......................................................... (2,865,658) (5,784,609)
Class C shares......................................................... (38,314) (46,847)
Net realized gain on investments:
Class A shares......................................................... ---- (246,714)
Class B shares......................................................... ---- (57,569)
Class C shares......................................................... ---- (447)
________________ ______________
Total Dividends...................................................... (15,620,040) (33,518,499)
________________ ______________
BENEFICIAL INTEREST TRANSACTIONS:
Net proceeds from shares sold:
Class A shares......................................................... 50,976,858 97,168,956
Class B shares......................................................... 9,182,652 13,717,368
Class C shares......................................................... 1,017,480 1,639,929
Dividends reinvested:
Class A shares......................................................... 7,078,897 15,604,972
Class B shares......................................................... 1,570,309 3,291,903
Class C shares......................................................... 15,431 30,755
Cost of shares redeemed:
Class A shares......................................................... (78,567,567) (138,425,542)
Class B shares......................................................... (8,338,020) (16,411,365)
Class C shares......................................................... (440) (983,046)
________________ ______________
Increase (Decrease) in Net Assets from Beneficial Interest Transactions (17,064,400) (24,366,070)
________________ ______________
Total Increase (Decrease) in Net Assets............................ 6,363,995 (13,453,412)
NET ASSETS:
Beginning of Period...................................................... 567,861,794 581,315,206
________________ ______________
End of Period............................................................ $574,225,789 $567,861,794
================ ==============
Undistributed investment income-net........................................ $ 247,776 ----
________________ ______________
SEE NOTES TO FINANCIAL STATEMENTS.
DREYFUS PREMIER MUNICIPAL BOND FUND
STATEMENT OF CHANGES IN NET ASSETS (CONTINUED)
Shares
___________________________________
Six Months Ended
October 31, 1997 Year Ended
(Unaudited) April 30, 1997
________________ ______________
CAPITAL SHARE TRANSACTIONS:
Class A
_______
Shares sold............................................................ 3,521,381 6,879,873
Shares issued for dividends reinvested................................. 487,669 1,104,332
Shares redeemed........................................................ (5,431,715) (9,791,371)
__________ __________
Net Increase (Decrease) in Shares Outstanding (1,422,665) (1,807,166)
========== ==========
Class B
________
Shares sold............................................................ 634,645 971,997
Shares issued for dividends reinvested................................. 108,139 232,925
Shares redeemed........................................................ (576,865) (1,164,445)
__________ __________
Net Increase (Decrease) in Shares Outstanding 165,919 40,477
========== ==========
Class C
_______
Shares sold............................................................ 70,631 117,036
Shares issued for dividends reinvested................................. 1,062 2,175
Shares redeemed........................................................ (30) (69,481)
__________ __________
Net Increase (Decrease) in Shares Outstanding 71,663 49,730
========== ==========
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<TABLE>
<CAPTION>
DREYFUS 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 period indicated. This
information has been derived from the Fund's financial statements.
Class A Shares
__________________________________________________________________
Six Months Ended
October 31, 1997 Year Ended April 30,
_____________________________________________
PER SHARE DATA: (Unaudited) 1997 1996 1995 1994 1993
__________ _____ _____ _____ _____ _____
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period.. $14.11 $13.85 $13.86 $13.81 $14.45 $13.75
_____ _____ _____ _____ _____ _____
Investment Operations:
Investment income-net................. .41 .82 .86 .84 .89 .92
Net realized and unrealized gain (loss)
on investments...................... .58 .27 (.01) .05 (.59) .91
_____ _____ _____ _____ _____ _____
Total from Investment Operations...... .99 1.09 .85 .89 .30 1.83
_____ _____ _____ _____ _____ _____
Distributions:
Dividends from investment income-net.. (.40) (.82) (.86) (.84) (.89) (.92)
Dividends from net realized gain on investments - (.01) - - (.05) (.21)
_____ _____ _____ _____ _____ _____
Total Distributions................... (.40) (.83) (.86) (.84) (.94) (1.13)
_____ _____ _____ _____ _____ _____
Net asset value, end of period........ $14.70 $14.11 $13.85 $13.86 $13.81 $14.45
===== ===== ===== ===== ===== =====
TOTAL INVESTMENT RETURN (1)............... 14.10%(2) 8.03% 6.08% 6.72% 1.84% 13.76%
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets .92%(2) .91% .92% .92% .85% .74%
Ratio of net investment income to average
net assets.......................... 5.62%(2) 5.84% 5.98% 6.16% 6.01% 6.43%
Decrease reflected in above expense ratios
due to undertakings by the Manager.. - - - - .06% .20%
Portfolio Turnover Rate............... 14.15%(3) 28.17% 36.59% 38.60% 22.15% 30.99%
Net Assets, end of period (000's Omitted) $455,563 $457,327 $474,044 $495,616 $546,036 $526,606
(1) Exclusive of sales load.
(2) Annualized.
(3) Not annualized.
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<TABLE>
<CAPTION>
DREYFUS PREMIER MUNICIPAL BOND FUND
FINANCIAL HIGHLIGHTS (CONTINUED)
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 period indicated. This
information has been derived from the Fund's financial statements.
Class B Shares
__________________________________________________________________
Six Months Ended
October 31, 1997 Year Ended April 30,
_____________________________________________
PER SHARE DATA: (Unaudited) 1997 1996 1995 1994 1993(1)
__________ _____ _____ _____ _____ _____
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period.. $14.11 $13.85 $13.86 $13.81 $14.45 $14.02
_____ _____ _____ _____ _____ _____
Investment Operations:
Investment income-net................. .37 .75 .78 .77 .80 .24
Net realized and unrealized gain (loss)
on investments...................... .59 .27 (.01) .05 (.59) .43
_____ _____ _____ _____ _____ _____
Total from Investment Operations...... .96 1.02 .77 .82 .21 .67
_____ _____ _____ _____ _____ _____
Distributions:
Dividends from investment income-net.. (.37) (.75) (.78) (.77) (.80) (.24)
Dividends from net realized gain on investments - (.01) - - (.05) -
_____ _____ _____ _____ _____ _____
Total Distributions................... (.37) (.76) (.78) (.77) (.85) (.24)
_____ _____ _____ _____ _____ _____
Net asset value, end of period........ $14.70 $14.11 $13.85 $13.86 $13.81 $14.45
===== ===== ===== ===== ===== =====
TOTAL INVESTMENT RETURN(2)................ 13.57%(3) 7.49% 5.53% 6.15% 1.26% 16.80%(3)
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets 1.43%(3) 1.43% 1.43% 1.44% 1.40% 1.15%(3)
Ratio of net investment income to average
net assets.......................... 5.10%(3) 5.33% 5.46% 5.62% 5.33% 5.13%(3)
Decrease reflected in above expense ratios
due to undertakings by the Manager.. - - - - .05% .10%(3)
Portfolio Turnover Rate............... 14.15%(4) 28.17% 36.59% 38.60% 22.15% 30.99%
Net Assets, end of period (000's Omitted) $116,515 $109,485 $106,931 $99,411 $95,643 $19,855
(1) From January 15, 1993 (commencement of initial offering) to April 30, 1993.
(2) Exclusive of sales load.
(3) Annualized.
(4) Not annualized.
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<TABLE>
<CAPTION>
DREYFUS PREMIER MUNICIPAL BOND FUND
FINANCIAL HIGHLIGHTS (CONTINUED)
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 period indicated. This
information has been derived from the Fund's financial statements.
Class C Shares
_____________________________________________
Six Months Ended
October 31, 1997 Year Ended April 30,
_____________________
PER SHARE DATA: (Unaudited) 1997 1996(1)
_________ _____ _____
<S> <C> <C> <C>
Net asset value, beginning of period....................... $14.12 $13.87 $14.28
_____ _____ _____
Investment Operations:
Investment income-net...................................... .35 .72 .60
Net realized and unrealized gain (loss)
on investments........................................... .60 .26 (.41)
_____ _____ _____
Total from Investment Operations........................... .95 .98 .19
_____ _____ _____
Distributions:
Dividends from investment income-net....................... (.35) (.72) (.60)
Dividends from net realized gain on investments............ - (.01) -
_____ _____ _____
Total Distributions........................................ (.35) (.73) (.60)
_____ _____ _____
Net asset value, end of period............................. $14.72 $14.12 $13.87
===== ===== =====
TOTAL INVESTMENT RETURN(2)..................................... 13.45%(3) 7.16% 1.56%(3)
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets.................... 1.66%(3) 1.64% 1.77%(3)
Ratio of net investment income to average
net assets............................................... 4.82%(3) 5.01% 4.84%(3)
Portfolio Turnover Rate.................................... 14.15%(4) 28.17% 36.59%
Net Assets, end of period (000's Omitted).................. $2,148 $1,049 $340
(1) From July 13, 1995 (commencement of initial offering) to April 30, 1996.
(2) Exclusive of sales load.
(3) Annualized.
(4) Not annualized.
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
DREYFUS PREMIER MUNICIPAL BOND FUND
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
NOTE 1-Significant Accounting Policies:
Dreyfus Premier Municipal Bond Fund (the "Fund") is registered under the
Investment Company Act of 1940 ("Act") as a diversified open-end management
investment company. The Fund's investment objective is to maximize current
income exempt from Federal income tax to the extent consistent with the
preservation of capital. The Dreyfus Corporation ("Manager") serves as the
Fund's investment adviser. The Manager is a direct subsidiary of Mellon Bank,
N.A.
Premier Mutual Fund Services, Inc. (the "Distributor") is the distributor
of the Fund's shares. The Fund is authorized to issue an unlimited number of
$.001 par value shares in each of the following classes of shares: Class A,
Class B and Class C. Class A shares are subject to a sales charge imposed at
the time of purchase, Class B shares are subject to a contingent deferred
sales charge ("CDSC") imposed on Class B share redemptions made within six
years of purchase (five years for shareholders beneficially owning Class B
shares on November 30, 1996) and Class C shares are subject to a CDSC imposed
on Class C shares redeemed within one year of purchase. Other differences
between the classes include the services offered to and the expenses borne by
each class and certain voting rights.
The Fund's financial statements are prepared in accordance with generally
accepted accounting principles which may require the use of management
estimates and assumptions. Actual results could differ from those estimates.
(a) Portfolio valuation: Investments in securities (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 are readily
available and are representative of the bid side of the market in the
judgment of the Service are valued at the mean between the quoted bid prices
(as obtained by the Service from dealers in such securities) and asked prices
(as calculated by the Service based upon its evaluation of the market for
such securities). Other investments (which constitute a majority of the
portfolio securities) are carried at fair value as determined by the Service
based on methods which include consideration of: yields or prices of
municipal securities of comparable quality, coupon, maturity and type;
indications as to values from dealers; and general market conditions.
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 original issue discounts on
investments, is earned from settlement date and recognized on the accrual
basis. Securities purchased or sold on a when-issued or delayed-delivery
basis may be settled a month or more after the trade date.
(c) Dividends to shareholders: It is the policy of the Fund to declare
dividends daily from investment income-net. Such dividends are paid monthly.
Dividends from net realized capital gain are normally declared and paid
annually, but the Fund may make distributions on a more frequent basis to
comply with the distribution requirements of the Internal Revenue Code. To
the extent that net realized capital gain can be offset by capital loss
carryovers, it is the policy of the Fund not to distribute such gain.
DREYFUS PREMIER MUNICIPAL BOND FUND
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
(d) Federal income taxes: It is the policy of the Fund to continue to
qualify as a regulated investment company, which can distribute tax exempt
dividends, by complying with the applicable provisions of the Internal Revenue
Code, and to make distributions of income and net realized capital gain
sufficient to relieve it from substantially all Federal income and excise taxes.
The Fund has an unused capital loss carryover of approximately $1,777,000
available for Federal income tax purposes to be applied against future net
securities profits, if any, realized subsequent to April 30, 1997. If not
applied, the carryover expires in fiscal 2003.
NOTE 2-Bank Line of Credit:
The Fund participates with other Dreyfus-managed Funds in a $600 million
redemption credit facility ("Facility") to be utilized for temporary or
emergency purposes, including the financing of redemptions. In connection
therewith, the Fund has agreed to pay commitment fees on its pro rata portion
of the Facility. Interest is charged to the Fund at rates based on
prevailing market rates in effect at the time of borrowings. For the period
ended October 31, 1997, the Fund did not borrow under the Facility.
NOTE 3-Management Fee and Other Transactions With Affiliates:
(a) Pursuant to a management agreement with the Manager, the management
fee is computed at the annual rate of .55 of 1% of the value of the Fund's
average daily net assets and is payable monthly.
Dreyfus Service Corporation, a wholly-owned subsidiary of the Manager,
retained $1,607 during the period ended October 31, 1997 from commissions
earned on sales of the Fund's shares.
(b) Under the Distribution Plan adopted pursuant to Rule 12b-1 under the
Act, the Fund pays the Distributor for distributing the Fund's Class B and
Class C shares at an annual rate of .50 of 1% of the value of the average
daily net assets of Class B shares and .75 of 1% of the value of the average
daily net assets of Class C shares. During the period ended October 31, 1997,
the Fund was charged $285,812 and $6,062 for Class B and Class C shares,
respectively, pursuant to the 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, Class B and Class C shares for the provision of certain services.
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 (a securities dealer, financial institution or other industry
professional) in respect of these services. The Distributor determines the
amounts to be paid to Service Agents. During the period ended October 31,
1997, the Fund was charged $573,980, $142,906 and $2,021 for Class A, Class B
and Class C shares, respectively, pursuant to the Shareholder Services Plan.
The Fund compensates Dreyfus Transfer, Inc., a wholly-owned subsidiary of
the Manager, under a transfer agency agreement for providing personnel and
facilities to perform transfer agency services for the Fund. During the
period ended October 31, 1997, the Fund was charged $125,433 pursuant to the
transfer agency agreement.
DREYFUS PREMIER MUNICIPAL BOND FUND
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
(d) Each trustee who is not an "affiliated person" as defined in the Act
receives from the Fund an annual fee of $2,500 and an attendance fee of
$250 per meeting. The Chairman of the Board receives an additional 25% of
such compensation.
NOTE 4-Securities Transactions:
The aggregate amount of purchases and sales of investment securities,
excluding short-term securities, during the period ended October 31, 1997
amounted to $79,549,889 and $99,282,865, respectively.
At October 31, 1997, accumulated net unrealized appreciation on
investments was $36,502,554, consisting of $49,531,402 gross unrealized
appreciation and $13,028,848 gross unrealized depreciation.
At October 31, 1997, 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).
Registration Mark
[Dreyfus lion "d" logo]
DREYFUS PREMIER MUNICIPAL
BOND FUND
200 Park Avenue
New York, NY 10166
MANAGER
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
CUSTODIAN
The Bank of New York
90 Washington Street
New York, NY 10286
TRANSFER AGENT &
DIVIDEND DISBURSING AGENT
Dreyfus Transfer, Inc.
P.O. Box 9671
Providence, RI 02940
Printed in U.S.A. 022SA9710
Registration Mark
[Dreyfus logo]
Semi-Annual Report
Dreyfus Premier
Municipal
Bond Fund
October 31, 1997
Registration Mark
