Dreyfus
Premier Municipal
Bond Fund
SEMIANNUAL REPORT October 31, 2000
(reg.tm)
The views expressed herein are current to the date of this report. These views
and the composition of the fund's portfolio are subject to change at any time
based on market and other conditions.
* Not FDIC-Insured * Not Bank-Guaranteed * May Lose Value
Contents
THE FUND
--------------------------------------------------
2 Letter from the President
3 Discussion of Fund Performance
6 Statement of Investments
13 Statement of Assets and Liabilities
14 Statement of Operations
15 Statement of Changes in Net Assets
17 Financial Highlights
20 Notes to Financial Statements
FOR MORE INFORMATION
---------------------------------------------------------------------------
Back Cover
The Fund
Dreyfus Premier
Municipal Bond Fund
LETTER FROM THE PRESIDENT
Dear Shareholder:
We are pleased to present this semiannual report for Dreyfus Premier Municipal
Bond Fund, covering the six-month period from May 1, 2000 through October 31,
2000. Inside, you' ll find valuable information about how the fund was managed
during the reporting period, including a discussion with the fund's portfolio
manager, Samuel Weinstock.
Despite some modest fluctuations because of changing economic conditions,
municipal bond prices generally rose modestly over the six-month reporting
period. Most sectors of the municipal bond market also benefited from slowing
economic growth as well. Additionally, the moderating effects of the Federal
Reserve Board' s (the "Fed") interest-rate hikes during the first half of 2000
helped the Fed to achieve its goal of slowing the U.S. economy. Other factors
such as higher energy prices and a weak euro also served to slow economic
growth.
In general, the overall investment environment that prevailed in the second half
of the 1990s had provided returns well above their long-term averages,
establishing unrealistic expectations for some investors. We believe that as the
risks of the stock market have become more apparent recently, the relative
stability and income potential of municipal bonds can make them an attractive
investment as part of a well-balanced portfolio.
For more information about the economy and financial markets, we encourage you
to visit the Market Commentary section of our website at www.dreyfus.com. Or, to
speak with a Dreyfus customer service representative, call us at 1-800-782-6620
Thank you for investing in Dreyfus Premier Municipal Bond Fund.
Sincerely,
Stephen E. Canter
President and Chief Investment Officer
The Dreyfus Corporation
November 15, 2000
DISCUSSION OF FUND PERFORMANCE
Samuel Weinstock, Portfolio Manager
How did Dreyfus Premier Municipal Bond Fund perform during the period?
For the six-month period ended October 31, 2000, the fund's Class A shares
provided a 4.62% total return, its Class B shares provided a 4.40% total return
and its Class C shares provided a 4.24% total return.(1) In comparison, the
Lipper General Municipal Debt Funds category average provided a 5.15% total
return for the same period.(2)
We attribute the fund's absolute performance to a relatively strong investment
environment for municipal bonds over the past six months, which was driven
primarily by signs of an economic slowdown in the U.S., as well as positive
supply-and-demand factors affecting municipal bonds throughout the nation.
However, our lagging relative performance is largely the result of our focus on
income-oriented and high quality securities during a time in which more
aggressive bonds performed best. The fund's conservative approach tends to help
our relative performance during declining markets, but may cause the fund to lag
in rising markets.
What is the fund's investment approach?
Our goal is to seek as high a level of federally tax-exempt income as is
practical without undue risk from a diversified portfolio of municipal bonds
To achieve our objective, we employ four primary strategies. First, we strive to
identify the maturity range that we believe will provide the most favorable
returns over the next two years. Second, we evaluate issuers' credit quality to
find bonds that we believe provide high yields at attractive prices. Third, we
look for bonds with attractively high interest payments, even if they sell at a
premium to face value. Fourth, we assess individual bonds' early redemption
features, focusing on those that cannot be redeemed soon by their issuers.
Typically, the bonds we select for the fund will have several of these
qualities.
The Fund
DISCUSSION OF FUND PERFORMANCE (CONTINUED)
What other factors influenced the fund's performance?
The fund was positively influenced over the past six months by favorable
economic and market conditions. When the reporting period began on May 1, 2000,
the U.S. economy continued to grow strongly, raising concerns that long-dormant
inflationary pressures might reemerge. In response, the Federal Reserve Board
(the "Fed" ) raised short-term interest rates once during the reporting period
for an increase of 0.50 percentage points. However, signs soon emerged that the
Fed's previous interest-rate hikes were having the desired effect of slowing the
economy, suggesting that the Fed's restrictive monetary policies could be near
an end.
In addition, the continuing strength of state and local economies helped keep
municipal bond yields relatively low compared to taxable bonds. Most
municipalities enjoyed higher revenues during the reporting period, curtailing
their need to borrow and resulting in a reduced supply of securities compared to
the same period in 1999. When supply falls and demand rises or remains steady,
prices of existing bonds tend to move higher.
In this environment, we sold some of our shorter term holdings that were less
liquid -- that is, more difficult to trade -- than we would have liked. We also
sold income-oriented bonds into a secondary market characterized by very strong
demand from individual investors, helping to maximize the prices we receive
We redeployed the proceeds of those sales primarily into bonds that we believe
are more likely to provide attractive total returns, including intermediate-term
bonds with no provisions for early redemption. Other new purchases included
insured bonds; double-A rated housing bonds with attractive income
characteristics; and bonds from high tax states such as New Jersey, California
and Connecticut. We have also added "index bonds," which, because they are
included in popular municipal bond indices, tend to be highly liquid. Despite
these changes, we have generally maintained the fund's average duration -- a
measure of sensitivity to changing interest rates -- in the neutral range, part
of our strategy to enhance price stability.
What is the fund's current strategy?
We have generally maintained the same strategy that we employed through most of
the reporting period. We have continued to attempt to upgrade our holdings with
insured and highly rated bonds, which we expect will help balance our
long-standing holdings of lower rated, high yield bonds.
We also intend to carefully monitor the current economic slowdown. We are doing
this not to forecast interest-rate trends, but to identify factors that may
affect our holdings' credit quality. By conducting intensive credit analyses, we
believe that we can more effectively seek to improve the fund's income stream.
At the same time, we intend to focus on risk management through broad
diversification and by maintaining a prudent balance between income-oriented and
total return-oriented bonds.
November 15, 2000
(1) 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 APPLICABLE CONTINGENT DEFERRED SALES CHARGE
IMPOSED ON REDEMPTIONS IN THE CASE OF CLASS B AND CLASS C SHARES. HAD THESE
CHARGES BEEN REFLECTED, RETURNS WOULD HAVE BEEN LOWER. PAST PERFORMANCE IS NO
GUARANTEE OF FUTURE RESULTS. SHARE PRICE, YIELD AND INVESTMENT RETURN FLUCTUATE
SUCH THAT UPON REDEMPTION, FUND SHARES MAY BE WORTH MORE OR LESS THAN THEIR
ORIGINAL COST. INCOME MAY BE SUBJECT TO STATE AND LOCAL TAXES AND SOME INCOME
MAY BE SUBJECT TO THE FEDERAL ALTERNATIVE MINIMUM TAX (AMT) FOR CERTAIN
INVESTORS. CAPITAL GAINS, IF ANY, ARE FULLY TAXABLE.
(2) SOURCE: LIPPER INC.
<TABLE>
<CAPTION>
The Fund
STATEMENT OF INVESTMENTS
October 31, 2000 (Unaudited)
STATEMENT OF INVESTMENTS
Principal
LONG-TERM MUNICIPAL INVESTMENTS--101.5% Amount ($) Value ($)
------------------------------------------------------------------------------------------------------------------------------------
ALABAMA--2.0%
University of Alabama, HR:
<S> <C> <C>
5.75%, 9/1/2020 (Insured; MBIA) 3,000,000 3,032,280
5.75%, 11/15/2029 (Insured; MBIA) 5,000,000 5,112,650
CALIFORNIA--5.3%
California:
5.625%, 5/1/2018 5,550,000 5,750,355
5.25%, 10/1/2024 50,000 49,030
6.47%, 10/1/2024 5,000,000 4,806,050
California Public Works Board, LR
(Dept. of Corrections Corcoran)
5.50%, 1/1/2017 (Insured; AMBAC) 5,000,000 5,113,900
Foothill/Eastern Transportation Corridor Agency,
Toll Road Revenue
6%, 1/1/2034 5,000,000 5,479,900
COLORADO--10.9%
Arapahoe County Capital Improvement Trust Fund,
Highway Revenue
(E-470 Project):
Zero Coupon, 8/31/2005 2,530,000 2,010,718
Zero Coupon, 8/31/2007 (Prerefunded 8/31/2005) 4,000,000 (a) 2,836,920
7%, 8/31/2026 (Prerefunded 8/31/2005) 11,000,000 (a) 12,424,720
Dawson Ridge, Metropolitan District Number 1
Zero Coupon, 10/1/2017 9,930,000 3,243,436
Denver City and County, Airport Revenue:
6%, 11/15/2014 (Insured; AMBAC) 5,000,000 5,259,700
6%, 11/15/2017 (Insured; AMBAC) 5,000,000 5,196,600
7.50%, 11/15/2023 (Prerefunded 11/15/2004) 2,060,000 (a) 2,309,301
7.50%, 11/15/2023 9,715,000 10,638,119
CONNECTICUT--5.9%
Connecticut:
5.75%, 6/15/2011 130,000 139,576
6.496%, 6/15/2011 5,500,000 (b,c) 6,310,260
Connecticut Development Authority,
PCR (Connecticut Light & Power)
5.85%, 9/1/2028 7,700,000 7,247,086
Connecticut Housing Finance Authority
5.85%, 5/15/2031 2,500,000 2,504,450
Mashantucket Western Pequot Tribe, Special Revenue
5.75%, 9/1/2027 8,000,000 7,374,880
DELAWARE--1.0%
Delaware Housing Authority, MFMR 7%, 5/1/2025 3,725,000 3,886,479
Principal
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) Amount ($) Value ($)
------------------------------------------------------------------------------------------------------------------------------------
FLORIDA--3.6%
Miami-Dade County Industrial Development Authority,
Special Facilities Revenue (United Airlines, Inc. Project)
6.05%, 3/1/2035 3,000,000 (d) 3,023,100
Palm Beach County, Solid Waste IDR:
(Okeelanta Power LP Project) 6.85%, 2/15/2021 6,750,000 (d) 3,982,500
(Osceola Power LP) 6.95%, 1/1/2022 7,500,000 (d) 4,425,000
Santa Rosa Bay Bridge Authority, Revenue 6.25%, 7/1/2028 3,000,000 2,843,310
GEORGIA--1.2%
Georgia 5.25%, 7/1/2017 5,000,000 4,985,850
ILLINOIS--2.9%
Carol Stream, First Mortgage Revenue
(Windsor Park Manor Project) 6.50%, 12/1/2007 2,000,000 1,998,280
Chicago O'Hare International Airport, Special Facility Revenue
4.713%, 4/1/2011 2,725,000 (b,c) 2,227,579
(United Airlines Project) 5.20%, 4/1/2011 50,000 45,437
East Chicago, PCR
(Inland Steel Co. Project) 7.125%, 6/1/2007 3,000,000 2,908,920
Illinois Development Finance Authority, Revenue
(Community Rehabilitation Providers Facility):
8.75%, 3/1/2010 157,000 158,060
8.50%, 9/1/2010 1,495,000 1,530,835
8.25%, 8/1/2012 2,735,000 2,846,369
INDIANA--3.3%
Indiana Development Finance Authority:
Exempt Facilities Revenue (Inland Steel)
5.75%, 10/1/2011 11,500,000 9,848,140
PCR (Inland Steel Co., Project Number 12)
6.85%, 12/1/2012 3,800,000 3,571,240
KENTUCKY--1.5%
Perry County, SWDR (TJ International Project):
7%, 6/1/2024 3,500,000 3,578,960
6.55%, 4/15/2027 2,500,000 2,471,400
LOUISIANA--1.9%
DeSoto Parish, PCR (Cleco Utility Group, Inc. Project)
5.875%, 9/1/2029 (Insured; AMBAC) 3,110,000 3,162,061
Louisiana Housing Finance Agency, MFHR
(LaBelle Projects) 9.75%, 10/1/2020 4,045,000 4,435,019
MARYLAND--.5%
Maryland Energy Financing Administration, SWDR
(Wheelabrator Water Projects) 6.45%, 12/1/2016 2,100,000 2,151,597
The Fund
STATEMENT OF INVESTMENTS (Unaudited) (CONTINUED)
Principal
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) Amount ($) Value ($)
------------------------------------------------------------------------------------------------------------------------------------
MASSACHUSETTS--5.7%
Massachusetts Industrial Finance Agency:
Health Care Facility Revenue
(Metro Health Foundation, Inc. Project)
6.75%, 12/1/2027 8,000,000 7,325,440
Water Treatment Revenue (American Hingham)
6.95%, 12/1/2035 2,640,000 2,727,833
Massachusetts Turnpike Authority, Metropolitan Highway
Systems Revenue 5%, 1/1/2039 (Insured; MBIA) 5,000,000 4,432,850
Route 3 North Transportation Improvement Association, LR:
5.75%, 6/15/2017 (Insured; MBIA) 3,000,000 3,108,540
5.25%, 6/15/2024 (Insured; MBIA) 5,565,000 5,349,913
MICHIGAN--3.2%
Michigan Hospital Finance Authority, HR:
(Ascension Health Credit)
5.375%, 11/15/2033 6,500,000 (b,c) 6,481,020
Michigan Strategic Fund, Limited Obligation Revenue
(Detroit Edison) 4.70%, 09/01/2001 5,000,000 5,003,750
Wayne County Building Authority
8%, 3/1/2017 (Prerefunded 3/1/2002) 1,500,000 (a) 1,596,510
NEW JERSEY--4.6%
New Jersey Turnpile Authority, Turnpike Revenue:
6.847%, 1/1/2011 6,350,000 (b,c) 7,569,137
6%, 1/1/2011 (Insured; MBIA) 75,000 82,199
5.625%, 1/1/2015 (Insured; MBIA) 4,700,000 4,866,333
5.50%, 1/1/2030 (Insured; MBIA) 6,000,000 5,977,860
NEW MEXICO--.4%
Farmington, PCR
(Public Service Co.--San Juan Project) 6.375%, 4/1/2022 1,800,000 1,769,976
NEW YORK--12.5%
New York City Industrial Development Agency,
IDR, Refunding (Laguardia Associates LP Project)
5.80%, 11/1/2013 8,710,000 7,834,210
New York City Municipal Water Finance Authority,
Water & Sewer Systems Revenue:
6.50%, 6/15/2031 2,000,000 2,200,560
6%, 6/15/2033 5,000,000 5,208,950
New York State Dormitory Authority, Revenues:
5.74%, 2/15/2013 (Insured; MBIA) 5,000,000 (b,c) 5,043,800
(Bronx/Lebanon Hospital)
5.20%, 2/15/2013 (Insured; MBIA) 2,860,000 2,872,527
Principal
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) Amount ($) Value ($)
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK (CONTINUED)
New York State Dormitory Authority, Revenues (continued):
(New York University):
5.75%, 7/1/2016 (Insured; MBIA) 2,300,000 2,450,788
6%, 7/1/2017 (Insured; MBIA) 3,500,000 3,803,170
New York State Energy Research and Development Authority,
Electric Facilities Revenue (Long Island Lighting Co.):
7.15%, 9/1/2019 2,535,000 2,645,475
7.15%, 9/1/2019 (Prerefunded 6/15/2002) 1,115,000 (a) 1,180,216
7.15%, 6/1/2020 2,980,000 3,109,868
7.15%, 6/1/2020 (Prerefunded 6/15/2002) 1,020,000 (a) 1,079,660
7.15%, 12/1/2020 1,320,000 1,377,526
7.15%, 12/1/2020 (Prerefunded 6/15/2002) 3,680,000 (a) 3,895,243
7.15%, 2/1/2022 (Prerefunded 6/15/2002) 2,500,000 (a) 2,649,075
Port Authority of New York and New Jersey
5.35%, 9/15/2014 (Insured; FGIC) 1,655,000 1,679,626
Scotia Housing Authority, Housing Revenue
(Coburg Village, Inc. Project) 6.10%, 7/1/2018 4,000,000 3,470,240
NORTH CAROLINA--1.9%
Charlotte, Special Facilities Revenue
(Charlotte/Douglas International Airport) 5.60%, 7/1/2027 5,000,000 3,719,350
North Carolina Eastern Municipal Power Agency,
Power System Revenue
7%, 1/1/2013 3,500,000 3,893,365
OHIO--1.3%
Ohio Water Development Authority,
Pollution Control Facilites Revenue
(Cleveland Electric) 6.10%, 8/1/2020 5,500,000 5,180,890
OKLAHOMA--1.8%
Holdenville Industrial Authority, Correctional Facility Revenue:
6.60%, 7/1/2010 (Prerefunded 7/1/2006) 2,045,000 (a) 2,253,079
6.70%, 7/1/2015 (Prerefunded 7/1/2006) 4,625,000 (a) 5,118,256
PENNSYLVANIA--2.7%
Blair County Hospital Authority, Revenue (Altoona Hospital)
6.375%, 7/1/2013 (Insured; AMBAC) 5,000,000 (b) 5,248,400
Montgomery County Higher Education and Health Authority
First Mortgage Revenue (AHF/Montgomery, Inc. Project)
10.50%, 9/1/2020 3,370,000 3,490,680
Pennsylvania Intergovernmental Cooperative Authority
Special Tax Revenue (Philadelphia Funding Program)
6.80%, 6/15/2022 (Prerefunded 6/15/2002) 2,000,000 (a) 2,074,640
The Fund
STATEMENT OF INVESTMENTS (Unaudited) (CONTINUED)
Principal
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) Amount ($) Value ($)
------------------------------------------------------------------------------------------------------------------------------------
RHODE ISLAND--.8%
Providence, Special Tax Increment Obligation
6.65%, 6/1/2016 3,000,000 3,107,970
TENNESSEE--2.5%
Memphis Center Revenue Finance Corporation,
Sports Facility Revenue
(Memphis Redbirds) 6.50%, 9/1/2028 8,000,000 7,167,600
Shelby County Health Educational and Housing Facilities,
Multi-Family Housing Board Revenue (Cameron Kirby)
7.25%, 7/1/2023 3,005,000 2,988,022
TEXAS--10.0%
Alliance Airport Authority, Special Facilities Revenue
6.847%, 4/1/2021 2,500,000 (b,c) 2,440,650
(Federal Express Corp. Project) 6.375%, 4/1/2021 40,000 39,525
Brazo River Authority, PCR
(Utilities Electric Company)
5.55%, 6/1/2030 (Insured; MBIA) 3,175,000 3,047,175
Dallas-Fort Worth International Airport Facility Improvement
Corporation, Revenue:
5.95%, 11/1/2003 50,000 50,313
(American Airlines, Inc.):
6.242%, 5/1/2029 2,500,000 (b,c) 2,531,300
6.375%, 5/1/2035 7,150,000 6,970,106
Gulf Coast Waste Disposal Authority, Revenue
(Waste Disposal--Valero Energy Corp.) 5.60%, 4/1/2032 6,000,000 5,050,080
Houston:
Airport System Improvement Revenue
(Special Facilities--Continental Airline Terminal)
6.125%, 7/15/2017 (Guaranteed; Continental Airline, Inc.) 5,425,000 4,970,982
Water & Sewer Systems Revenue
5.25%, 12/1/2030 (Insured; MBIA) 5,000,000 4,729,250
Rio Grande City Consolidated Independent School District
Public Facilities Corporation, LR
6.75%, 7/15/2010 6,000,000 6,317,760
Texas Public Property Finance Corp., Revenue
(Mental Health and Retardation Center)
8.20%, 10/1/2012 (Prerefunded 10/1/2002) 1,800,000 (a) 1,955,376
Tyler Health Facilities Development Corporation, HR
(Mother Frances Hospital) 5.625%, 7/1/2013 2,680,000 2,359,150
Principal
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) Amount ($) Value ($)
------------------------------------------------------------------------------------------------------------------------------------
UTAH--2.8%
Carbon County, SWDR:
(East Carbon Development Corp.) 9%, 7/1/2012 3,700,000 3,778,995
(Sunnyside Cogeneration--A) 7.10%, 8/15/2023 7,450,000 7,082,939
(Sunnyside Cogeneration--B) Zero Coupon, 8/15/2024 2,320,000 379,691
VIRGINIA--2.5%
Virginia Housing Development Authority,
Commonwealth Mortgage
5.80%, 1/1/2018 8,180,000 8,268,508
West Point Industrial Development Authority, SWDR
(Chesapeake Corp.)
6.375%, 3/1/2019 2,000,000 1,810,660
WEST VIRGINIA--2.6%
Upshur County, SWDR (TJ International Project)
7%, 7/15/2025 7,000,000 7,156,380
West Virginia Hospital Finance Authority, HR
(Charleston Area Medical Center) 6%, 9/1/2012 3,230,000 3,222,926
U.S. RELATED--6.2%
Puerto Rico Commonwealth:
6.25%, 7/1/2013 (Insured; MBIA) 3,000,000 3,413,640
5.65%, 7/1/2015 (Insured; MBIA) 4,000,000 4,292,280
Public Improvement:
5.25%, 7/1/2013 (Insured; MBIA) 6,000,000 6,244,920
6.50%, 7/1/2014 (Insured; MBIA) 5,000,000 5,814,200
Zero Coupon, 7/1/2015 (Insured; MBIA) 2,400,000 1,122,000
Puerto Rico Telephone Authority, Revenue
6.639%, 1/25/2007
(Insured; MBIA, Prerefunded 1/1/2003) 3,950,000 (a,b) 4,152,435
------------------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS (cost $412,965,323) 101.5% 409,155,855
LIABILITIES, LESS CASH AND RECEIVABLES (1.5%) (6,096,136)
NET ASSETS 100.0% 403,059,719
The Fund
</TABLE>
STATEMENT OF INVESTMENTS (Unaudited) (CONTINUED)
Summary of Abbreviations
AMBAC American Municipal
Bond Assurance Corporation
EDR Economic Development Revenue
FGIC Financial Guaranty
Insurance Company
FSA Financial Security Assurance
HR Hospital Revenue
IDR Industrial Development Revenue
LR Lease Revenue
MBIA Municipal Bond
Investors Assurance
Insurance Corporation
MFHR Multi-Family
Housing Revenue
MFMR Multi-Family
Mortgage Revenue
PCR Pollution Control Revenue
SWDR Solid Waste Disposal Revenue
<TABLE>
<CAPTION>
Summary of Combined Ratings (Unaudited)
Fitch or Moody's or Standard & Poor's Value (%)
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
AAA Aaa AAA 40.5
AA Aa AA 10.2
A A A 6.6
BBB Baa BBB 13.0
BB Ba BB 4.3
B B B 3.1
Not Rated (e) Not Rated (e) Not Rated (e) 22.3
100.0
(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) INVERSE FLOATER SECURITY -- THE INTEREST RATE IS SUBJECT TO CHANGE
PERIODICALLY.
(C) SECURITIES 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 OCTOBER 31, 2000,
THESE SECURITIES AMOUNTED TO $32,603,746 OR 8.1% OF NET ASSETS.
(D) NON-INCOME PRODUCING SECURITY; INTEREST PAYMENTS IN DEFAULT.
(E) SECURITIES WHICH, WHILE NOT RATED BY FITCH, MOODY'S AND STANDARD & POOR'S
HAVE BEEN DETERMINED BY THE MANAGER TO BE OF COMPARABLE QUALITY TO THOSE RATED
SECURITIES IN WHICH THE FUND MAY INVEST.
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
STATEMENT OF ASSETS AND LIABILITIES
October 31, 2000 (Unaudited)
Cost Value
--------------------------------------------------------------------------------
ASSETS ($):
Investments in securities--See Statement of
Investments 412,965,323 409,155,855
Interest receivable 7,263,879
Receivable for investment securities sold 486,551
Receivable for shares of Beneficial Interest subscribed 45,007
Prepaid expenses 19,765
416,971,057
--------------------------------------------------------------------------------
LIABILITIES ($):
Due to The Dreyfus Corporation and affiliates 302,359
Cash overdraft due to Custodian 8,738,929
Payable for investment securities purchased 4,766,658
Payable for shares of Beneficial Interest redeemed 40,806
Accrued expenses 62,586
13,911,338
--------------------------------------------------------------------------------
NET ASSETS ($) 403,059,719
--------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS ($):
Paid-in capital 427,662,471
Accumulated net realized gain (loss) on investments (20,793,284)
Accumulated net unrealized appreciation (depreciation)
on investments--Note 4 (3,809,468)
--------------------------------------------------------------------------------
NET ASSETS ($) 403,059,719
<TABLE>
<CAPTION>
NET ASSET VALUE PER SHARE
Class A Class B Class C
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net Assets ($) 351,210,518 47,413,037 4,436,164
Shares outstanding 27,017,878 3,646,335 340,733
------------------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE ($) 13.00 13.00 13.02
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
The Fund
STATEMENT OF OPERATIONS
Six Months Ended October 31, 2000 (Unaudited)
--------------------------------------------------------------------------------
INVESTMENT INCOME ($):
INTEREST INCOME 12,717,185
EXPENSES:
Management fee--Note 3(a) 1,138,767
Shareholder servicing costs--Note 3(c) 653,017
Legal fees 184,144
Distribution fees--Note 3(b) 141,387
Custodian fees 22,230
Registration fees 19,871
Auditing fees 15,470
Prospectus and shareholders' reports 15,056
Trustees' fees and expenses--Note 3(d) 9,401
Loan commitment fees--Note 2 2,022
Miscellaneous 11,286
TOTAL EXPENSES 2,212,651
INVESTMENT INCOME--NET 10,504,534
--------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS--NOTE 4 ($):
Net realized gain (loss) on investments (3,415,021)
Net unrealized appreciation (depreciation) on investments 11,187,093
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS 7,772,072
NET INCREASE NET ASSETS RESULTING FROM OPERATIONS 18,276,606
SEE NOTES TO FINANCIAL STATEMENTS.
STATEMENT OF CHANGES IN NET ASSETS
Six Months Ended
October 31, 2000 Year Ended
(Unaudited) April 30, 2000
--------------------------------------------------------------------------------
OPERATIONS ($):
Investment income--net 10,504,534 24,824,900
Net realized gain (loss) on investments (3,415,021) (17,425,166)
Net unrealized appreciation (depreciation)
on investments 11,187,093 (34,930,839)
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS 18,276,606 (27,531,105)
--------------------------------------------------------------------------------
DIVIDENDS TO SHAREHOLDERS FROM ($):
Investment income--net:
Class A shares (9,232,908) (20,911,012)
Class B shares (1,170,674) (3,632,920)
Class C shares (100,952) (280,968)
Net realized gain on investments:
Class A shares -- (4,812,233)
Class B shares -- (821,235)
Class C shares -- (60,751)
TOTAL DIVIDENDS (10,504,534) (30,519,119)
--------------------------------------------------------------------------------
BENEFICIAL INTEREST TRANSACTIONS ($):
Net proceeds from shares sold:
Class A shares 58,261,175 119,058,167
Class B shares 3,794,928 9,353,802
Class C shares 3,228,996 3,197,754
Dividends reinvested:
Class A shares 5,186,707 15,209,492
Class B shares 585,194 2,380,084
Class C shares 49,430 108,996
Cost of shares redeemed:
Class A shares (80,563,136) (157,637,399)
Class B shares (10,871,872) (61,408,528)
Class C shares (3,353,507) (6,196,568)
INCREASE (DECREASE) IN NET ASSETS FROM
BENEFICIAL INTEREST TRANSACTIONS (23,682,085) (75,934,200)
TOTAL INCREASE (DECREASE) IN NET ASSETS (15,910,013) (133,984,424)
--------------------------------------------------------------------------------
NET ASSETS ($):
Beginning of Period 418,969,732 552,954,156
END OF PERIOD 403,059,719 418,969,732
SEE NOTES TO FINANCIAL STATEMENTS.
The Fund
STATEMENT OF CHANGES IN NET ASSETS (CONTINUED)
Six Months Ended
October 31, 2000 Year Ended
(Unaudited) April 30, 2000
--------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS:
CLASS A( A)
Shares sold 4,535,378 8,947,487
Shares issued for dividends reinvested 403,088 1,155,931
Shares redeemed (6,269,758) (11,919,959)
NET INCREASE (DECREASE) IN SHARES OUTSTANDING (1,331,292) (1,816,541)
--------------------------------------------------------------------------------
CLASS B( A)
Shares sold 295,509 693,475
Shares issued for dividends reinvested 45,489 179,946
Shares redeemed (847,372) (4,575,315)
NET INCREASE (DECREASE) IN SHARES OUTSTANDING (506,374) (3,701,894)
--------------------------------------------------------------------------------
CLASS C
Shares sold 251,003 243,277
Shares issued for dividends reinvested 3,834 8,306
Shares redeemed (260,392) (469,388)
NET INCREASE (DECREASE) IN SHARES OUTSTANDING (5,555) (217,805)
(A) DURING THE PERIOD ENDED OCTOBER 31, 2000, 339,272 CLASS B SHARES
REPRESENTING $4,360,634 WERE AUTOMATICALLY CONVERTED TO 339,484 CLASS A SHARES
AND DURING THE PERIOD ENDED APRIL 30, 2000, 2,612,242 CLASS B SHARES
REPRESENTING $34,929,103 WERE AUTOMATICALLY CONVERTED TO 2,613,946 CLASS A
SHARES.
SEE NOTES TO FINANCIAL STATEMENTS.
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
The following tables describe the performance for each share class for the
fiscal periods indicated. All information (except portfolio turnover rate)
reflects financial results for a single fund share. Total return shows how much
your investment in the fund would have increased (or decreased) during each
period, assuming you had reinvested all dividends and distributions. These
figures have derived from the fund's financial statements.
Six Months Ended
October 31, 2000 Year Ended April 30,
-----------------------------------------
CLASS A SHARES (Unaudited) 2000 1999 1998 1997 1996
------------------------------------------------------------------------------------------------------------------------------
PER SHARE DATA ($):
Net asset value,
<S> <C> <C> <C> <C> <C> <C>
beginning of period 12.75 14.33 14.69 14.11 13.85 13.86
Investment Operations:
Investment income--net .33 .70 .72 .79 .82 .86
Net realized and unrealized
gain (loss) on investments .25 (1.42) (.15) .66 .27 (.01)
Total from Investment Operations .58 (.72) .57 1.45 1.09 .85
Distributions:
Dividends from investment
income--net (.33) (.70) (.72) (.79) (.82) (.86)
Dividends from net realized
gain on investments -- (.16) (.21) (.08) (.01) --
Total Distributions (.33) (.86) (.93) (.87) (.83) (.86)
Net asset value, end of period 13.00 12.75 14.33 14.69 14.11 13.85
------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN (%) (A) 9.16(b) (5.01) 3.96 10.52 8.03 6.08
------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA (%):
Ratio of expenses to
average net assets 1.00(b) .93 .91 .91 .91 .92
Ratio of net investment
income to
average net assets 5.13(b) 5.28 4.96 5.42 5.84 5.98
Portfolio Turnover Rate 37.09(c) 70.39 46.84 26.33 28.17 36.59
------------------------------------------------------------------------------------------------------------------------------
Net Assets, end of period
($ x 1,000) 351,211 361,567 432,276 447,869 457,327 474,044
(A) EXCLUSIVE OF SALES CHARGE.
(B) ANNUALIZED.
(C) NOT ANNUALIZED.
SEE NOTES TO FINANCIAL STATEMENTS.
The Fund
FINANCIAL HIGHLIGHTS (CONTINUED)
Six Months Ended
October 31, 2000 Year Ended April 30,
-----------------------------------------
CLASS B SHARES (Unaudited) 2000 1999 1998 1997 1996
------------------------------------------------------------------------------------------------------------------------------------
PER SHARE DATA ($):
Net asset value,
beginning of period 12.76 14.33 14.69 14.11 13.85 13.86
Investment Operations:
Investment income--net .30 .63 .65 .72 .75 .78
Net realized and unrealized
gain (loss) on investments .24 (1.41) (.15) .66 .27 (.01)
Total from Investment Operations .54 (.78) .50 1.38 1.02 .77
Distributions:
Dividends from investment
income--net (.30) (.63) (.65) (.72) (.75) (.78)
Dividends from net realized
gain on investments -- (.16) (.21) (.08) (.01) --
Total Distributions (.30) (.79) (.86) (.80) (.76) (.78)
Net asset value, end of period 13.00 12.76 14.33 14.69 14.11 13.85
------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN (%)(A) 8.73(b) (5.51) 3.43 9.95 7.49 5.53
------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA (%):
Ratio of expenses to
average net assets 1.51(b) 1.45 1.42 1.42 1.43 1.43
Ratio of net investment income
to average net assets 4.71(b) 4.71 4.44 4.89 5.33 5.46
Portfolio Turnover Rate 37.09(c) 70.39 46.84 26.33 28.17 36.59
------------------------------------------------------------------------------------------------------------------------------
Net Assets, end of period
($ x 1,000) 47,413 52,979 112,583 119,457 109,485 106,931
(A) EXCLUSIVE OF SALES CHARGE.
(B) ANNUALIZED.
(C) NOT ANNUALIZED.
SEE NOTES TO FINANCIAL STATEMENTS.
Six Months Ended
October 31, 2000 Year Ended April 30,
-----------------------------------------
CLASS C SHARES (Unaudited) 2000 1999 1998 1997 1996(a)
------------------------------------------------------------------------------------------------------------------------------------
PER SHARE DATA ($):
Net asset value,
beginning of period 12.77 14.35 14.71 14.12 13.87 14.28
Investment Operations:
Investment income--net .29 .60 .61 .68 .72 .60
Net realized and unrealized
gain (loss) on investments .25 (1.42) (.15) .67 .26 (.41)
Total from Investment Operations .54 (.82) .46 1.35 .98 .19
Distributions:
Dividends from investment
income--net (.29) (.60) (.61) (.68) (.72) (.60)
Dividends from net realized
gain on investments -- (.16) (.21) (.08) (.01) --
Total Distributions (.29) (.76) (.82) (.76) (.73) (.60)
Net asset value, end of period 13.02 12.77 14.35 14.71 14.12 13.87
------------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN (%)(B) 8.41(c) (5.71) 3.16 9.73 7.16 1.56(c)
------------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA (%):
Ratio of expenses to average
net assets 1.74(c) 1.68 1.67 1.69 1.64 1.77(c)
Ratio of net investment
income to average
net assets 4.41(c) 4.52 4.11 4.55 5.01 4.84(c)
Portfolio Turnover Rate 37.09(d) 70.39 46.84 26.33 28.17 36.59
------------------------------------------------------------------------------------------------------------------------------------
Net Assets, end of period
($ x 1,000) 4,436 4,424 8,095 3,019 1,049 340
(A) FROM JULY 13, 1995 (COMMENCEMENT OF INITIAL OFFERING) TO APRIL 30, 1996.
(B) EXCUSIVE OF SALES CHARGE.
(C) ANNUALIZED.
(D) NOT ANNUALIZED.
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
The 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, as amended (the "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 (the "Manager") serves
as the fund's investment adviser. The Manager is a direct subsidiary of Mellon
Bank, N.A, which is a wholly-owned subsidiary of Mellon Financial Corporation
Dreyfus Service Corporation, (the "Distributor"), a wholly-owned subsidiary of
the Manager, is the distributor of the fund's shares. The fund is authorized to
issue an unlimited number of $.001 par value shares of Beneficial Interest 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. Class B shares automatically convert to Class A shares after
six years. 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 accounting
principles generally accepted in the United States, 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 val
ued 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. Under the terms of the custody
agreement, the fund receives net earnings credits based on available cash
balances left on deposit.
(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, if any, 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 of 1986, as amended (the
" 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.
The 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 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 $11,183,000
available for Federal income tax purposes to be applied against future net
securities profits, if any, realized subsequent to April 30, 2000. This amount
is calculated based on Federal income tax regulations which may differ from
financial reporting in accordance with generally accepted accounting
principles.If not applied, the carryover expires in fiscal 2008.
NOTE 2--Bank Line of Credit:
The fund participates with other Dreyfus-managed funds in a $500 million
redemption credit facility (the "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 the borrowings. During the period ended
October 31, 2000, 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 Trust's average
daily net assets and is payable monthly.
The Distributor retained $589 during the period ended October 31, 2000 from
commissions earned on sales of the fund's shares.
(b) Under the Distribution plan (the "Plan") adopted pursuant to Rule 12b-1
under the Act, Class B and Class C shares pay the Distributor for distributing
their 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, 2000, Class B and
Class C shares were charged $124,227 and $17,160, respectively, pursuant to the
Plan.
(c) Under the Shareholder Services Plan, Class A, Class B and Class C shares pay
the Distributor at an annual rate of .25 of 1% of the value of the average daily
net assets of their 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, 2000, Class A, Class B and Class C
shares were charged $449,788, $62,113 and $5,720, 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, 2000, the fund was charged $125,008 pursuant to the transfer
agency agreement.
(d) Each Board member also serves as a Board member of other funds within the
Dreyfus complex (collectively, the "Fund Group"). Each Board member who is not
an "affiliated person" as defined in the Act receives an annual fee of $50,000
and an attendance fee of $6,500 for each meeting attended and $500 for telephone
meetings.These fees are allocated among the funds in the Fund Group. The
Chairman of the Board receives an additional 25% of such compensation. Subject
to the Trust' s Emeritus Program Guidelines, Emeritus Board members, if any,
receive 50% of the fund's annual retainer fee and per meeting fee paid at the
time the Board member achieves emeritus status.
The Fund
NOTES TO FINANCIAL STATEMENTS (Unaudited) (CONTINUED)
NOTE 4--Securities Transactions:
The aggregate amount of purchases and sales of investment securities, excluding
short-term securities, during the period ended October 31, 2000, amounted to
$150,335,368 and $152,671,478, respectively.
At October 31, 2000, accumulated net unrealized depreciation on investments was
$3,809,468, consisting of $13,191,582 gross unrealized appreciation and
$17,001,050 gross unrealized depreciation.
At October 31, 2000, 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).
For More Information
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
100 Church Street
New York, NY 10286
Transfer Agent & Dividend Disbursing Agent
Dreyfus Transfer, Inc.
P.O. Box 9671
Providence, RI 02940
Distributor
Dreyfus Service Corporation
200 Park Avenue
New York, NY 10166
To obtain information:
BY TELEPHONE Call your financial representative or 1-800-554-4611
BY MAIL Write to: The Dreyfus Premier Family of Funds 144 Glenn Curtiss
Boulevard Uniondale, NY 11556-0144
(c) 2000 Dreyfus Service Corporation 022SA0010
