ROYCE VALUE TRUST INC, N-30D, 1996-08-07

ROYCE VALUE TRUST INC
N-30D, 1996-08-07

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Royce Value Trust

SEMI-ANNUAL REPORT
June 30, 1996

<PAGE>
<PAGE>
The Royce Funds
1414 Avenue of the Americas
New York, NY 10019
(212) 355-7311
(800) 221-4268

Dear Stockholder:

After a left foot start in January, small company stocks, as measured by the
Russell 2000 index, outperformed their large company brethren (S&P 500) in
February, March, April and May (15.2% versus 6.2%), but were unable to continue
their winning ways in June (-4.1% versus 0.4%). June's downturn in performance
was the first sign of potentially higher volatility for small-cap issues. In
fact, the Nasdaq Composite closed the second quarter off over 5% from the high
it established on June 5th, its largest decline since a 13.8% drop in the second
quarter of 1994. In spite of June's downturn, and because of the February-May
surge, the Russell 2000 index of small-cap stocks won the first half performance
derby with a 10.4% total return versus a 10.2% total return for the large-cap
oriented S&P 500. Similarly, the small-cap oriented S&P 600 was up 11.2%.
Effective July 1, 1996, the S&P 600 replaces the S&P 500 as the Fund's
investment advisory fee performance benchmark.

Within small-cap, 'growth' finished ahead of 'value' with the Russell 2000
Growth Index providing an 11.9% return versus an 8.7% gain for the Russell 2000
Value Index. A similar performance relationship, but with wider disparity, was
also present in the Wilshire Target Small Cap Index Funds, as the Small Cap
Growth Fund (+13.2%) handily outperformed the Small Cap Value Fund (+3.9%).
ROYCE VALUE TRUST, INC. ('RVT'), with its small-cap value orientation, performed
in line with the two small-cap value proxies for both the quarter and the six
month period, posting NAV total returns of 3.8% and 6.8%, respectively.
Contributing to the Fund's performance were nice gains in two sectors (retail
and consumer durables) which had been mediocre performers in 1995.

Although not always leading in the short-term, RVT's intermediate and
longer-term results are competitive on an absolute and risk adjusted basis.
Average annual NAV total returns for the one year, five year and since inception
(November 26, 1986) periods were 16.0%, 15.9% and 12.4%, respectively. One of
RVT's additional attributes is its relatively low risk profile. According to
independent mutual fund evaluation service Morningstar, RVT was one of the
lowest risk domestic equity closed-end funds for the three years ended June 30,
1996, as measured by standard deviation (4th lowest out of 32 funds), beta (5th
lowest out of 32 funds) and Morningstar's risk ratio (5th lowest out of 32
funds). WE BELIEVE THAT OUR APPROACH OF INVESTING IN HIGH QUALITY SMALL-CAP
COMPANIES, USING ABSOLUTE VALUATION STANDARDS, IS AN APPROPRIATE STRATEGY FOR
GENERATING ABOVE AVERAGE RESULTS.

FIREWORKS IN JULY

[GRAPHIC]

Louis Pasteur once said, 'Chance favors the prepared mind.' Although everyone
was prepared for the fireworks of July 4th, few were prepared for the market
fireworks which began in June and intensified throughout July. Double digit
gains in small-cap indices were erased and many investors now find themselves
starting over at mid-year.

PERFORMANCE UPDATE THROUGH JULY 31

% DECLINE JULY '96 YTD RETURN
FROM HIGH* RETURN THRU 7/31/96
--------- -------- ------------
RVT (NAV) -5.6% -3.8% +2.7%
Russell 2000 -13.1% -8.7% +0.7%
Nasdaq Comp. -13.4% -8.8% +2.7%

* Russell 2000 high was made on 5/22/96.
2

We view the current pyrotechnics of July from the vantage point that these
fluctuations are inevitable and desirable, and part of the normal rhythm of the
market. We are prone to keep ourselves at a distance. This is largely common
sense -- no special preparation needed.

WORTH REPEATING

To be quoted is flattering. To quote oneself presents the dual risk of boring
our readers and tooting our own horn. Nevertheless, we want to repeat some of
our comments from the 1995 Annual Report. (We promise we won't do this again.)

IN OUR LAST REPORT WE SAID:

'An interesting aspect of this five year rise in both stocks and bonds is the
ever increasing participation of individual investors....In fact, it is that
very same demand which is believed to ensure future success and prevent any
major reversal in market fortunes....The suggestion that continued success is
nearly guaranteed by demand is a scary proposition....We remain most astonished,
not with the magnitude of investor appetite for stocks, but the nearly universal
assumption of its permanence.'

WE NOW THINK:

In a perverse way, the least informed (the purchasing public) now appear to
be dictating investment policy to those presumed most knowledgeable (portfolio
managers). Normally prudent professionals have taken comfort in the fact that
the public is pouring money into equity mutual funds. As one of our shareholders
commented, 'The inmates are running the asylum.'

ALSO IN THE 1995 ANNUAL REPORT WE SAID:

'We are certain, particularly in a global economy, that an ample supply of
securities can be created to meet and even exceed investors' demands.'

AND NOW:

The $132 billion of new investments in equity mutual funds for the first half
of 1996 has eclipsed the prior annual record set in 1993 ($130 billion for the
full year). Yet, the dramatic upward progress that this commitment was expected
to produce has not materialized. A move up in long-term interest rates and
increased corporate insider selling activity are partly to blame, as well as a
surge in IPO activity. By late June, roughly 80 new offerings a week were
producing a fresh supply of securities at the rate of approximately $20 billion
a month.

[GRAPHIC]

One of the most instructive offerings of the recent IPO boom was the creation
and issuance of Berkshire Hathaway Inc. Class B shares. Berkshire Hathaway's
Chairman, Warren Buffett, is perhaps the best known investor of our time.
Multiple warnings on the front page of the prospectus included ''neither
Mr. Buffett nor Mr. Munger (Vice Chairman) would currently buy
Berkshire shares (at the current price), nor would they recommend
that their families or friends do so'' and ''Berkshire has attempted to assess
the current demand for Class B shares and has tailored the size of this offering
to fully satisfy that demand (and) therefore, buyers hoping to capture quick
profits are almost certain to be disap-

pointed.'' Yet, despite the warnings, over $500 million was raised.
WALL STREET HAS BEEN SUCCESSFUL IN CREATING AN AMPLE SUPPLY OF
NEW AND SECONDARY OFFERINGS TO FULLY SATISFY DEMAND.
HOWEVER, IT PROVIDES NO SIMILAR 'WARNING LABELS.'

ADDITIONALLY WE SAID:

'The magnitude of the decline in interest rates is virtually not repeatable.
Consequently, a further decline in interest rates will not have the same
favorable impact on stock prices, no matter how bullish one is on rates.'

AND NOW:

The consensus expectations of lower rates (then at 6%) in an election year
have proved to be wrong. Long-term government bond yields rose by over 20% in
the first half to a current yield of over 7.0%. While this surprise has not
ended the party, it's getting hard to find the punch bowl.

AND FINALLY WE SAID:

'THE NEXT FIVE YEARS WILL BE DIFFERENT! It's not likely that the next five years
will rival the previous five in terms of ideal wind conditions or spectacular
performance. History tells us that periods of high valuation and high return are
usually followed by periods of lower, less dynamic returns....We see no reason
why performance should not revert to the mean and, thus, a period of lower five
year returns is likely. Very simply, the last five years was a period in which
risk and reward were synonymous and one in which risk management provided
virtually no benefit. It's likely that we have completed the best five year
performance period for this decade.'

AND NOW?

Enough said.

THE VALUE IN VALUE INVESTING

A basic premise of value investing is that stocks, like other goods and
services, should be purchased at the most attractive prices possible, preferably
at a discount to their 'intrinsic worth.' The reality for most investors is just
the opposite. In other words, investor comfort levels and, therefore, demand
increase when prices rise, and diminish as prices decline. The higher a stock
rises, the greater the perceived opportunity.

Value investing, on the other hand, takes a contrary view to this highly
emotional process. By systematically reducing risk when others ignore it and
taking risk when it is feared, one can capitalize on valuation discrepancies
(opportunities) which develop from time to time. The greatest risk that the
value investor confronts is the loss of either patience or discipline when faced
with the prospect of being out-of-sync with the market. THE VALUE IN 'VALUE
INVESTING' IS TO PROVIDE A COHERENT SYSTEM FOR RATIONAL DECISION MAKING . . .
THE PURPOSE OF WHICH IS TO COMPOUND WEALTH WHILE MINIMIZING RISK. Its basic
premise is that the price one pays for an investment makes a significant
difference in the return one receives.

WHAT WE DO

[GRAPHIC]

Royce Value Trust uses a risk-averse approach to invest in the securities of
small-cap companies. Experience tells us that paying attention to risk does not
diminish long-term results, although individual market phases may not
necessarily confirm this.

Our approach attempts to understand and value a company's private
worth -- what we believe an enterprise would sell for in a transaction between
rational parties. The price we will pay for a security must be significantly
under our appraisal of its private worth. The consistent use of this discipline,
applied to less well-known securities, is the source of our performance.

NO OTHER PLACE WE WOULD RATHER BE

While the Fund focuses on companies with market caps below $1 billion, our
weighted average and median market caps
are actually much lower, $359 million and $256 million, respectively, at June
30, 1996.

Although our orientation is small-cap stocks, our picking universe is by no
means small, with over 10,000 companies valued at more than $900 billion in
total market capitalization. It is both robust and perpetuating; IPO's,
spin-offs and reorganizations create hundreds of new prospects each year. It is
a sector rich in opportunity and easily accommodates our strategy given the size
of the investable universe.

From time to time we are criticized for the large number of securities that
we hold in the portfolio. In fact, given the size of our universe, we believe
our strategy is quite focused because total portfolio holdings represent fewer
than 3% of the available small-cap universe. Not many large-cap managers would
be content with only 15 selections from the S&P 500.

Not long ago we had a conversation with a highly successful and respected
fund manager about diversification. His contention was that statistical
diversification could be achieved with just 13 holdings. His own portfolio was
concentrated in a mere 20 selections. We were impressed. Yet, upon further
examination, we discovered his 20 large-cap holdings were involved in 61
different businesses. As defined by Standard Industrial Classification codes
(SICs), Philip Morris has seven different business groups, Pepsi has six,
Johnson & Johnson has five and so on. In contrast, the vast majority of our
holdings have single lines of business. When one adds up the numbers, there's
really not much difference in terms of diversification between our approach and
that of 'focused' managers.

HOW IT WORKS

[GRAPHIC]

Our approach to investing in individual small-cap companies has proven
historical benefits, but can be both unpredictable and frustrating in the
near-term. We believe that the stock market in the short-term is a polling
place, and in the long-term, a highly efficient weighing device. While our
ultimate success will continue to be driven by the process of 'weighing the true
value' of the small companies in which we have invested, the following provides
a brief glimpse of some of this year's 'election results.'

FALLING IN LOVE

[GRAPHIC]

Despite a generally rising market, there were numerous opportunities for us
to either add new positions or increase our investment in some old favorites.
The following companies represent our most significant commitments in 1996's
first half. More importantly, they represent examples of works in progress which
we hope will build future performance.

<TABLE>
<CAPTION>
SECURITY NET INVESTED
- -------------------------------------- ------------

<S> <C>
Penn Engineering & Mfg. Corp. $ 2,645,742
Marshall Industries 2,498,378
Zenith National Insurance Corp. 1,936,450
Leucadia National Corporation 1,830,897
Haemonetics Corporation 1,777,628
</TABLE>

Our largest new purchases were old favorites, Penn Engineering and
Manufacturing Corp. and Marshall Industries. Both of these companies are
indirect participants in the recent technology boom and ensuing bust. Penn
Engineering makes self clenching fasteners for computers and electronics as well
as many other applications. Marshall Industries distributes electronic
components including semi-conductors. Both companies have fortress like balance
sheets, generate high internal rates of return on their own

5
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capital and were purchased well off their highs. Zenith National Insurance Corp.
and Leucadia National Corporation are insurance companies. Each is well managed,
conservatively capitalized and, so far, unrecognized for their historically
superior performance. Rising interest rates and continuing price competition in
the insurance industry have provided us with the opportunity to increase our
ownership in these companies on very favorable terms. Finally, Haemonetics
Corporation is a market leader in providing equipment and disposable supplies in
the collection of blood. Earnings growth has temporarily slowed at Haemonetics
as the company awaits FDA approval for a new generation of blood collection
products. If Haemonetics new products perform as we think they can, this could
become a new growth stock star.

HARVEST SEASON

[GRAPHIC]

Selling stocks is always difficult for the value investor for it requires
either parting with success or admitting mistakes. So far this year we have done
both. The following is a list of our five largest divestitures during 1996's
first half.

<TABLE>
<CAPTION>
SECURITY NET PROCEEDS
- -------------------------------------- ------------

<S> <C>
Cliffs Drilling Company $2,996,440
Comdisco, Inc. 2,403,349
Claire's Stores, Inc. 2,345,389
The Wet Seal, Inc. (Class A) 2,213,560
Ash Grove Cement Co. 2,072,700
</TABLE>

In each case depicted above, we reduced our exposure due to full and fair
valuations. These companies were all purchased when conditions in their
respective industries were challenging and their potential was obscure to most
investors. Lately, fortunes in energy, computer leasing, retailing, and even
cement manufacturing have improved and we have enjoyed some big winners.

VOLATILITY IS A FRIEND

Recently, stock market volatility has generated a great deal of attention
from the financial press. While large changes (100 point or greater moves) in
the Dow Jones Industrial Average make interesting reading in the morning papers,
their significance is exaggerated. The table below depicts the Russell 2000's
yearly price variation using the index's annual range as a percentage of the
beginning year's price.

[GRAPHIC]

It's interesting to note how tame the markets have remained in the last four
and a half years relative to the prior thirteen. TO US, VOLATILITY IS A FRIEND
IN THAT IT CREATES IRRATIONAL PRICING OF SECURITIES AND, THEREFORE,
OPPORTUNITIES FOR US TO CAPITALIZE ON OUR RISK MANAGEMENT SKILLS.

ARE THERE ANY REAL INVESTORS LEFT?

[GRAPHIC]

The term 'investor' denotes a long-term supplier of capital. In contrast, a
'speculator' is one who takes opportunistic risk in hopes of generating quick
profits. In essence, investors expect to get paid by the correct assessment of
underlying business fundamentals, whereas speculators count on others (often
referred to as greater fools) to buy them out profitably.

In the current bull market, it has become very difficult to tell the
difference between investors and speculators. For example, what exactly is
'momentum investing?' The term

seems oxymoronic. While equities represent a permanent ownership position in an
enterprise, in many fund portfolios, they are reviewed and replaced more
frequently than three month Treasury Bills. Wall Street brokerage firms publish
'Buy' and 'Sell' recommendations based on a company's quarterly progress down to
the penny per share; and the country's largest equity mutual fund lost its star
manager after a short period of underperformance, which may have contributed to
the decision by that fund's investors to withdraw in excess of $1 billion.

Only time and more difficult market conditions will separate the true
investors from disappointed speculators. GIVEN THAT WE BELIEVE THAT EQUITIES
REPRESENT LONG-TERM INTERESTS IN BUSINESSES, THE TERM 'INVESTOR' SUITS US JUST
FINE.

WHAT DO WE DO NOW?

Given our belief that the next phase of the market will include lower equity
returns and greater volatility -- the need for basic blocking and tackling, in
the form of commitment, focus and experience, is paramount. We remain committed
to investing in high quality, small-cap companies using absolute valuation
standards; our focus remains sharp, and exclusively on small and micro-cap
companies; and our 20+ years of investment experience ensures that our vigilance
and discipline remain constant. Your continued confidence is appreciated.

Yours faithfully,

/s/ Charles M. Royce Jack E. Fockler, Jr.
Charles M. Royce W. Whitney George
President Vice Presidents

August 1, 1996

P.S. Our 'new era' fund will wait for the 'new era.'

Note: The Fund intends (subject to effectiveness of registration under the
Securities Act of 1933) to offer 2,400,000 shares of preferred stock for sale at
$25.00 per share through an underwriting syndicate to be led by Morgan Stanley &
Co. A registration statement relating to these securities has been filed with
the Securities and Exchange Commission, but has not yet become effective. These
securities may not be sold nor may offers to buy be accepted prior to the time
the registration statement becomes effective. This announcement does not
constitute an offer to sell or the solicitation of an offer to buy nor may there
be any sale of these securities in any State in which such offer, solicitation
or sale would be unlawful prior to registration or qualification under the
securities laws of any such State.

Morningstar proprietary risk ratio, beta and standard deviation are measures of
a fund's relative risk and are calculated for the trailing 36-month period.
Morningstar risk ratio measures a fund's downside volatility relative to all
equity funds which have an average score of 1.00. Beta is a measure of
sensitivity to market movements compared to the unmanaged S&P 500 index, with
the beta of the S&P 500 equal to 1.00. Standard deviation is a statistical
measure within which a fund's total return falls. The average Morningstar risk
ratio, beta and standard deviation for the 194 closed-end domestic equity funds
with a three-year history as of 6/30/96 were: 0.53, 0.85 & 10.97, respectively.
The Morningstar risk ratio, beta and standard deviation for Royce Value Trust
over the same period were: 0.32, 0.54 & 6.94, respectively. Source: Morningstar,
Inc.

The Russell 2000, Russell 2000 Growth, Russell 2000 Value, S&P 500 and S&P
SmallCap 600 indices are unmanaged and include the reinvestment of dividends.
The Nasdaq Composite is an unmanaged index. The Wilshire Target Small Company
Value and Growth Funds attempt to replicate the performance of the Wilshire Next
1750 Small Company Value and Growth Indices, respectively.

<TABLE>
<CAPTION>
FUND HIGHLIGHTS June 30, 1996
------------------
<S> <C> <C>
Net Assets $364,428,204
Net Asset Value Per Share $14.48
Market Price Per Share $12.375
Shares Outstanding 24,836,018
</TABLE>

- --------------------------------------------------------------------------------

FINANCIAL REVIEW

The table below represents the total returns of the Fund on two separate bases.
NAV total return is the compound rate of return, using net asset values, on an
amount invested in the Fund throughout the stated period and assumes
reinvestment of dividend and capital gain distributions and primary
participation in rights offerings. Stockholders are able to reinvest
distributions, and purchase shares through rights offerings, at prices which
have historically been below NAV, and without commission costs. NAV return is
the most meaningful measurement of a continuous stockholder's progress. Market
Value total return presents similar information, but values the Fund at market
rather than NAV and, therefore, reflects the actual experience of a stockholder,
before commission costs, who bought and sold shares of the Fund at the beginning
and ending dates.

<TABLE>
<CAPTION>
NAV Market Value S&P Russell S&P Small-
Total Return Total Return 500`D' 2000`D' Cap 600`D'
------------ ------------ ----- --------- ----------

<S> <C> <C> <C> <C> <C> <C>
Total Returns
3 months ended 6/30/96 3.8% 1.0% 4.5% 5.0% 5.2%
6 months ended 6/30/96 6.8 4.2 10.2 10.4 11.2

Annual Returns (ended December 31)
1995 22.6 20.5 37.5 28.4 30.0
1994 1.1 - 5.6 1.3 - 1.8 - 4.8
1993 17.9 14.8 10.0 18.9 18.8
1992 19.9 26.8 7.7 18.4 21.0
1991 39.5 35.3 30.5 46.1 48.5

Average Annual Total Returns (ended June 30, 1996)
1-year 16.0% 15.1% 26.1% 23.9% 26.0%
3-year 13.2 8.3 17.3 15.8 15.6
5-year 15.9 13.7 15.8 17.5 18.4
Since inception* 12.4 9.5 14.3 12.0 10.3
</TABLE>

`D' The S&P 500, Russell 2000 and S&P SmallCap 600 are unmanaged indices and
include the reinvestment of dividends. Source: Frank Russell Co.

* Inception date - November 26, 1986

The results presented in this report represent past performance and should not
be considered representative of the 'total return' from an investment in the
Fund today. They are provided only to give an historical perspective of the
Fund. The investment return and net asset and market values of Fund shares will
fluctuate, so that the shares may be worth more or less than their original cost
when sold.

HISTORY SINCE INCEPTION

The following table details the share accumulation history of an initial
investor in the Fund who reinvested all distributions and participated fully in
the rights offering. By reinvesting all distributions and fully participating in
the rights offerings, an investor maximizes his returns. This table should be
read in conjunction with the Financial Review of the Fund (see page 8).

<TABLE>
<CAPTION>
Amount Purchase NAV MKT
History Invested Price Shares Value* Value*
------------------- -------- -------- ------ ------- -------

<S> <C> <C> <C> <C> <C> <C>
11/26/86 Initial Purchase $10,000 $10.000 1,000 $ 9,280 $10,000

10/15/87 Distribution $.30 7.000 42

12/31/87 Distribution $.22 7.125 32 8,578 7,250

12/27/88 Distribution $.51 8.625 63 10,529 9,238

09/22/89 Rights Offering 405 9.000 45

12/29/89 Distribution $.52 9.125 67 12,942 11,866

09/24/90 Rights Offering 457 7.375 62

12/31/90 Distribution $.32 8.000 52 11,713 11,074

09/23/91 Rights Offering 638 9.375 68

12/31/91 Distribution $.61 10.625 82 17,919 15,697

09/25/92 Rights Offering 825 11.000 75

12/31/92 Distribution $.90 12.500 114 21,999 20,874

09/24/93 Rights Offering 1,469 13.000 113

12/31/93 Distribution $1.15 13.000 160 26,603 25,428

10/28/94 Rights Offering 1,103 11.250 98

12/19/94 Distribution $1.05 11.375 191 27,939 24,905

11/03/95 Rights Offering 1,425 12.500 114

12/07/95 Distribution $1.29 12.125 253 35,676 31,243
- ---------------------------------------------------------------------------------------------

06/30/96 $16,322 2,631 $38,097 $32,559
- ---------------------------------------------------------------------------------------------
</TABLE>

* Other than for Initial Purchase and for the current period, values are stated
as of December 31 of the year indicated, after reinvestment of distributions.

The Board of Directors has given the Fund's management the discretionary
authority to cause the Fund to repurchase up to 300,000 shares of its common
stock in open market and other transactions through December 31, 1996. Such
repurchases would be effected at a price per share less than the then current
net asset value, but not in excess of the then prevailing market price.

------------------------

The Board of Directors of the Fund is authorized to offer stockholders an
opportunity to subscribe for additional shares of common stock of the Fund
through rights offerings at a price per share that may be less than the then
current net asset value of the Fund's common stock. The timing and terms of any
such offerings are left to the Board's discretion. The Fund does not expect to
have a rights offering in 1996.

DISTRIBUTION REINVESTMENT AND CASH PURCHASE PLAN

WHAT IS THE DISTRIBUTION REINVESTMENT AND CASH PURCHASE PLAN?
Distributions of net investment income and capital gains, if any, are
normally made in December. The Fund's Distribution Reinvestment and Cash
Purchase Plan (the 'Plan') offers you an automatic way to reinvest your
dividends and capital gains distributions in additional shares of the Fund,
increasing your holdings in the Fund. Reinvestment of the annual distribution is
done at market price, without commissions. The number of shares to be issued to
a stockholder will be determined by dividing the amount of the distribution
payable to the stockholder by the last reported sale price of a share of the
Fund's common stock on the valuation date, which follows the record date.

The plan also allows registered stockholders to make optional cash
investments in shares of the Fund's common stock through the Plan Agent and to
deposit certificates representing Fund shares with the Plan Agent for
safekeeping. Stockholders should refer to the Plan document for information on
these options.

HOW DO REGISTERED STOCKHOLDERS PARTICIPATE IN THE PLAN?
If your shares are registered directly with the Fund, you are automatically
a participant in the Plan unless you have instructed the Plan Agent in writing
otherwise. The Plan Agent must receive the instructions not less than 10 days
prior to the record date for a distribution in order to be effective for that
distribution. A registered stockholder may also receive the distribution in the
form of a stock certificate for the full shares and a check for the fractional
share if the Plan Agent is properly notified. Stockholders who elect to not
participate in the Plan will receive all distributions in cash, paid by check
and mailed directly to the stockholder by State Street Bank and Trust Company,
dividend paying agent and Plan Agent.

WHAT IF MY SHARES ARE HELD BY A BROKERAGE FIRM, BANK OR OTHER NOMINEE?
If your shares are held in the name of a brokerage firm, bank, or other
nominee as the stockholder of record, we still expect them to automatically
reinvest distributions on your behalf. Please consult with your brokerage firm,
bank or other nominee to be certain that it is reinvesting distributions on your
behalf. If your nominee is unable to reinvest distributions on your behalf, you
should instruct your nominee to have your shares registered in your name in
order to participate.

HOW WILL I KNOW HOW MANY SHARES I HAVE?
The Plan Agent maintains the account for registered stockholders in the
Plan and sends written confirmation of all transactions in the account,
including information needed by participants for personal and tax records.
Shares in the account of each participant will be held by the Plan Agent in
non-certificated form in the name of the participant, and each participant will
be able to vote those shares at a shareholder meeting or by proxy. A participant
may also send other stock certificates held by them to the Plan Agent to be held
in non-certificated form. There is no service fee charged to participants for
reinvesting distributions. The Plan Agent's fees for the processing of the
distribution reinvestment are paid for by the Fund. A participant may terminate
his account under the Plan by written notice to the Plan Agent. Termination will
be effective as described in the Plan. If a participant elects to sell his
shares before the Plan is terminated, the Plan will deduct a $2.50 fee plus
brokerage commissions from the sale transaction. If a nominee is the registered
owner of your shares, the nominee will maintain the accounts on your behalf.

WHAT IF I NEED MORE INFORMATION?
You may obtain more detailed information by requesting a copy of the Plan
from the Plan Agent. All correspondence (including notifications) should be
directed to: Royce Value Trust, Inc. Distribution Reinvestment and Cash Purchase
Plan, c/o State Street Bank and Trust Company, PO Box 8200, Boston MA
02266-8200, (800) 426-5523.

<PAGE>
<PAGE>
PORTFOLIO SUMMARY

The following information is provided as a 'bird's eye' view of the RVT
portfolio. For a more complete picture, the full portfolio and accompanying
financial statements should be read in their entirety.
- --------------------------------------------------------------------------------

PORTFOLIO COMPOSITION

<TABLE>
<CAPTION>
% of Common % of Total
Stocks Value Investments
------------- --------------- ---------------
<S> <C> <C> <C>
Top 100 Stocks.................................. 63.6% $ 236,146,300 58.1%
Other Stocks.................................... 36.4 135,067,767 33.3
------------- --------------- ----------
Common Stocks................................... 100.0% 371,214,067 91.4
-------------
-------------
Bonds & Preferred Stock......................... 3,224,705 0.8
Repurchase Agreement............................ 31,500,000 7.8
--------------- ----------
Total Investments............................... $ 405,938,772 100.0%
--------------- ----------
--------------- ----------
</TABLE>

- --------------------------------------------------------------------------------

PORTFOLIO DIAGNOSTICS

<TABLE>
<S> <C>
Weighted Average Market Capitalization (Total Portfolio).......... $359 Million
Median Market Capitalization (Total Portfolio).................... $256 Million
Weighted Average P/E Ratio (100 Largest Positions)................ 13.8x
Weighted Average P/B Ratio (100 Largest Positions)................ 1.6x
Weighted Average Portfolio Yield (100 Largest Positions).......... 1.9%
</TABLE>

- --------------------------------------------------------------------------------

COMMON STOCK SECTORS

<TABLE>
<CAPTION>
% of Net Assets
---------------
<S> <C>
Financial.......................................................... 25.6%
Industrial Cyclicals............................................... 24.2
Services........................................................... 16.1
Consumer Durables.................................................. 11.4
Retail............................................................. 7.2
Technology......................................................... 5.0
Consumer Staples................................................... 4.3
Energy............................................................. 3.4
Miscellaneous...................................................... 2.9
Health............................................................. 1.7
Utilities.......................................................... 0.1
</TABLE>

- --------------------------------------------------------------------------------

TOP TWENTY POSITIONS

<TABLE>
<CAPTION>
Market Value % of Net Assets
--------------- ---------------
<S> <C> <C> <C>
1. Ash Grove Cement Company Cl. B............................... $4,321,629 1.2%
2. Comdisco, Inc................................................ 4,136,194 1.1
3. The Standard Register Company................................ 3,824,263 1.0
4. Zenith National Insurance Corp............................... 3,810,600 1.0
5. Family Dollar Stores, Inc.................................... 3,612,263 1.0
6. Wesco Financial Corporation.................................. 3,445,375 0.9
7. Velcro Industries N.V........................................ 3,335,550 0.9
8. Lilly Industries, Inc. Cl. A................................. 3,273,911 0.9
9. Juno Lighting, Inc........................................... 3,262,300 0.9
10. Marshall Industries.......................................... 3,234,000 0.9
11. Florida Rock Industries, Inc................................. 3,224,025 0.9
12. Kimball International, Inc. Cl. B............................ 3,138,200 0.9
13. Pennsylvania Manufacturers Corporation Cl. A................. 3,117,800 0.9
14. National Bancorp of Alaska, Inc.............................. 3,104,010 0.9
15. Transnational Re Corporation Cl. A........................... 3,087,975 0.8
16. Ethan Allen Interiors Inc.................................... 3,078,900 0.8
17. Woodward Governor Company.................................... 3,053,600 0.8
18. Vallen Corporation........................................... 3,050,757 0.8
19. Farmer Bros. Co.............................................. 3,036,000 0.8
20. The Dress Barn, Inc.......................................... 2,973,600 0.8

</TABLE>

<PAGE>
<PAGE>
ROYCE VALUE TRUST, INC.
SCHEDULE OF INVESTMENTS AT JUNE 30, 1996 (unaudited)
- --------------------------------------------------------------------------------
COMMON STOCKS -- 101.9%
<TABLE>
<CAPTION>
Shares Value
- ---------- ------------
<C> <S> <C>
CONSUMER DURABLES -- 11.4%
63,290 Allen Organ Company Cl.
B........................ $ 2,476,221
24,000 Burnham Corporation Cl.
A........................ 618,000
18,000 *Burnham Corporation Cl.
B........................ 463,500
52,950 *Conso Products Co......... 860,438
106,500 *Delta Woodside Industries,
Inc...................... 545,812
124,400 Ethan Allen Interiors
Inc...................... 3,078,900
154,172 First Years Inc............ 2,119,865
41,000 Flexsteel Industries,
Inc...................... 481,750
99,400 Garan Incorporated......... 1,689,800
65,700 *Johnson Worldwide
Associates, Inc. Cl. A... 903,375
191,900 Juno Lighting, Inc......... 3,262,300
148,400 K-Swiss Inc. Cl. A......... 1,613,850
5,000 La-Z-Boy Chair Company..... 150,625
116,100 *Lazare Kaplan
International, Inc....... 1,523,813
191,336 *Lifetime Hoan
Corporation.............. 2,056,862
41,000 *Marisa Christina,
Incorporated............. 820,000
54,700 Matthews International
Corporation Cl. A........ 1,504,250
41,600 National Presto Industries,
Inc...................... 1,580,800
64,900 The Rival Company.......... 1,492,700
30,700 Russ Berrie and Company,
Inc...................... 564,113
58,700 The Singer Company N.V..... 1,188,675
115,700 Skyline Corporation........ 2,892,500
85,200 The Stride Rite
Corporation.............. 702,900
55,100 Sturm, Ruger & Company,
Inc...................... 2,562,150
158,400 Thomaston Mills, Inc. Cl.
A........................ 1,782,000
125,700 Thor Industries, Inc....... 2,576,850
129,500 *The Topps Company, Inc.... 728,437
30,200 Weyco Group, Inc........... 1,223,100
------------
41,463,586
------------
CONSUMER STAPLES -- 4.3%
68,000 Alico, Inc................. 1,326,000
22,000 Farmer Bros. Co............ 3,036,000
30,000 Golden Enterprises, Inc.... 241,875
643 Hershey Creamery Company... 1,067,380
52,200 *J & J Snack Foods Corp.... 600,300
165,600 *Midwest Grain Products,
Inc...................... 2,152,800
4,050 Seaboard Corporation....... 803,925
102,700 Stanhome Inc............... 2,721,550
60,100 Velcro Industries N.V. .... 3,335,550
20,000 WLR Foods, Inc............. 280,000
------------
15,565,380
------------
ENERGY -- 3.4%
105,400 *American Oilfield Divers,
Inc...................... 948,600
70,000 *Belden & Blake
Corporation.............. 1,452,500
63,400 *Tom Brown, Inc............ 1,085,725
60,700 Camco International Inc.... 2,056,213
31,400 Devon Energy Corporation... 769,300

<CAPTION>
Shares Value
- ---------- ------------
<C> <S> <C>
28,000 *Gulfmark International
Inc...................... $ 973,000
66,500 Lufkin Industries, Inc..... 1,363,250
146,400 *Offshore Logistics,
Inc...................... 2,031,300
54,300 Penn Virginia
Corporation.............. 1,900,500
------------
12,580,388
------------
FINANCIAL -- 25.6%
10,400 Alexander & Alexander
Services Inc............. 205,400
10,103 *Alleghany Corporation..... 1,939,776
57,750 ALLIED Group, Inc.......... 2,512,125
94,000 ALLIED Life Financial
Corporation.............. 1,880,000
45,474 Argonaut Group, Inc........ 1,421,063
36,856 *Avatar Holdings Inc....... 1,266,925
15,000 BHC Financial, Inc......... 210,000
46,100 BHI Corporation............ 674,212
60,000 Baker, Fentress &
Company.................. 1,147,500
126,000 Baldwin & Lyons, Inc. Cl.
B........................ 2,598,750
42,800 W. R. Berkley Corp......... 1,786,900
92,100 E.W. Blanch Holdings,
Inc...................... 1,830,487
10,000 CB Bancshares, Inc......... 311,250
91,850 Capitol Transamerica
Corporation.............. 1,768,113
155,350 Comdisco, Inc.............. 4,136,194
111,718 The Commerce Group, Inc.... 2,332,113
7,800 Consolidated-Tomoka Land
Co....................... 154,050
8,282 County Bank Corp........... 296,081
50,200 Crawford & Company Cl. B... 872,225
100,100 Crawford & Company Cl. A... 1,701,700
65,100 Eaton Vance Corp........... 2,359,875
44,000 Fidelity National
Financial, Inc........... 665,500
215 The First National Bank of
Anchorage................ 324,650
57,750 Fremont General
Corporation.............. 1,328,250
79,600 Arthur J. Gallagher &
Co....................... 2,547,200
114,000 *Gryphon Holdings Inc...... 1,710,000
104,700 Guaranty National
Corporation.............. 1,884,600
202,475 Hilb, Rogal & Hamilton
Company.................. 2,809,341
108,128 Independence Holding
Company.................. 506,850
131,100 Intercargo Corporation..... 1,130,737
39,059 Investors Financial
Services Corporation..... 908,122
8,989 *Investors Financial
Services Corporation Cl.
A........................ 208,994
7,400 The John Nuveen Company.... 184,075
27,615 Keystone Heritage Group,
Inc...................... 624,789
77,500 Lawyers Title
Corporation.............. 1,395,000
100,400 Leucadia National
Corporation.............. 2,459,800
</TABLE>

The accompanying notes are an integral part of the financial statements.
12

<PAGE>
<PAGE>
ROYCE VALUE TRUST, INC.
SCHEDULE OF INVESTMENTS AT JUNE 30, 1996 (unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Shares Value
- ---------- ------------
FINANCIAL-(CONT'D)
<C> <S> <C>
38,110 *MAIC Holdings, Inc........ $ 1,419,598
4,200 *Markel Corporation........ 390,600
200 THE MECHANICS BANK......... 1,420,000
23,800 NYMAGIC, INC............... 449,225
49,270 National Bancorp of Alaska,
Inc...................... 3,104,010
59,500 New England Investment
Companies, L.P........... 1,398,250
123,800 The Newhall Land and
Farming Company.......... 2,042,700
119,500 Nobel Insurance Limited.... 1,389,187
45,600 Oriental Federal Savings
Bank..................... 866,400
53,587 Orion Capital
Corporation.............. 2,732,937
183,400 Pennsylvania Manufacturers
Corporation Cl. A........ 3,117,800
108,100 Phoenix Duff & Phelps
Corporation.............. 810,750
107,200 The Pioneer Group, Inc..... 2,867,600
69,500 Piper Jaffray Companies
Inc...................... 868,750
33,512 Poe & Brown, Inc........... 829,422
19,250 RLI Corp................... 469,219
59,025 *Rand Capital
Corporation.............. 92,227
15,356 *Reliance Group Holdings,
Inc...................... 31,679
21,200 Student Loan Corporation... 763,200
38,587 Titan Holdings, Inc........ 540,218
129,600 *Toreador Royalty
Corporation.............. 356,400
5,000 Transatlantic Holdings,
Inc...................... 350,625
125,400 Transnational Re
Corporation Cl. A........ 3,087,975
58,500 Trenwick Group Inc......... 2,925,000
249,205 *U.S. Global Investors Inc.
Cl. A.................... 716,464
21,450 Vornado Realty Trust....... 876,769
21,500 Wesco Financial
Corporation.............. 3,445,375
165,100 **Willis Corroon Group
plc...................... 1,960,563
139,200 Zenith National Insurance
Corp..................... 3,810,600
------------
93,226,190
------------
HEALTH -- 1.7%
25,200 Diagnostic Products
Corporation.............. 970,200
154,000 *Haemonetics Corporation... 2,810,500
43,900 Life Technologies, Inc..... 1,382,850
47,200 *Spacelabs Medical, Inc.... 1,097,400
------------
6,260,950
------------
INDUSTRIAL CYCLICALS -- 24.2%
2,501 R. P. Adams Company,
Inc...................... 45,018
50,200 American Filtrona
Corporation.............. 1,606,400
27,800 *Ameron International
Corp..................... 1,098,100
45,000 *Art's-Way Manufacturing
Co., Inc................. 225,000
38,759 Ash Grove Cement Company
Cl. B.................... 4,321,629
<CAPTION>
Shares Value
- ---------- ------------
<C> <S> <C>
53,500 *Guy F. Atkinson Company of
California............... $ 722,250
47,190 BHA Group, Inc. Cl. A...... 625,267
16,500 Baldor Electric Company.... 371,250
15,300 *Banister Foundation
Inc...................... 120,488
25,200 *Bird Corp................. 82,687
116,600 Blessings Corporation...... 1,195,150
83,100 W. H. Brady Co. Cl. A...... 1,848,975
148,900 CalMat Co.................. 2,698,813
36,400 Cascade Corp............... 486,850
375 Central Steel & Wire
Company.................. 236,625
114,969 *Chemfab Corporation....... 1,609,566
19,700 CLARCOR Inc................ 487,575
2,300 ConBraCo Industries,
Inc...................... 977,500
53,400 Curtiss-Wright
Corporation.............. 2,883,600
6,022 Decker Manufacturing
Corporation.............. 228,836
98,000 Fab Industries, Inc........ 2,670,500
9,000 Federal Signal
Corporation.............. 211,500
124,600 Florida Rock Industries,
Inc...................... 3,224,025
73,645 *`D'General Builders
Corporation.............. 46,028
111,900 P. H. Glatfelter Company... 2,056,162
24,800 Gorman-Rupp Company........ 328,600
124,969 Hawkins Chemical, Inc...... 968,510
12,500 *Hirsh International Corp.
Cl. A.................... 239,063
28,800 *Insituform Technologies,
Inc...................... 223,200
68,600 International Aluminum
Corporation.............. 1,732,150
41,700 Kaman Corporation Cl. A.... 422,212
113,600 Kimball International, Inc.
Cl. B.................... 3,138,200
79,750 Knape & Vogt Manufacturing
Company.................. 1,256,062
49,650 LeaRonal, Inc.............. 1,241,250
192,583 Lilly Industries, Inc. Cl.
A........................ 3,273,911
21,990 The Lincoln Electric
Company.................. 775,148
63,900 The Lincoln Electric
Company Cl. A............ 1,932,975
52,878 Liqui-Box Corporation...... 1,586,340
188,200 *MK Gold Company........... 282,300
39,553 MacDermid, Incorporated.... 2,768,710
44,800 Mine Safety Appliances
Company.................. 1,836,800
38,300 Paul Mueller Company....... 1,302,200
31,500 NCH Corporation............ 2,023,875
30,700 Nordson Corporation........ 1,734,550
37,600 Oil-Dri Corporation of
America.................. 559,300
45,000 Oregon Steel Mills, Inc.... 618,750
92,800 Oshkosh Truck Corporation
Cl. B.................... 1,310,800
57,800 Peerless Mfg. Co........... 621,350
10,000 *Pegasus Gold Inc.......... 122,500
</TABLE>

The accompanying notes are an integral part of the financial statements.
13

<PAGE>
<PAGE>
ROYCE VALUE TRUST, INC.
SCHEDULE OF INVESTMENTS AT JUNE 30, 1996 (unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Shares Value
- ---------- ------------
INDUSTRIAL CYCLICALS-(CONT'D)
<C> <S> <C>
126,600 Penn Engineering and
Manufacturing Inc........ $ 2,389,575
30,400 Penn Engineering and
Manufacturing Corp. Cl.
A........................ 718,200
75,800 *Perini Corporation........ 909,600
23,400 Precision Castparts
Corp..................... 1,006,200
41,300 Preformed Line Products
Company.................. 1,404,200
83,300 Puerto Rican Cement
Company, Inc............. 2,592,713
103,750 Quaker Chemical
Corporation.............. 1,322,812
51,270 Robroy Industries, Inc. Cl.
A........................ 794,685
102,600 *Shorewood Packaging
Corporation.............. 1,577,475
126,700 *Simpson Manufacturing Co.,
Inc...................... 2,534,000
47,000 *Sinter Metals, Inc. Cl.
A........................ 822,500
59,500 The L. S. Starrett Company
Cl. A.................... 1,547,000
33,300 Tecumseh Products Company
Cl. A.................... 1,789,875
44,286 *Thermal Industries,
Inc...................... 395,806
59,800 *The Turner Corporation.... 687,700
45,200 Unifi, Inc................. 1,271,250
4,308 United Screw and Bolt
Corporation.............. 310,176
73,700 Versa Technologies, Inc.... 994,950
15,000 Wellman, Inc............... 350,625
34,700 Woodward Governor Company.. 3,053,600
70,800 Zero Corporation........... 1,513,350
------------
88,364,842
------------
RETAIL -- 7.2%
5,000 *Alexander's, Inc.......... 363,125
13,000 J. Baker, Inc.............. 97,500
53,100 Blair Corporation.......... 1,254,488
26,900 *The Buckle, Inc........... 921,325
212,400 *CATHERINES STORES
CORPORATION.............. 2,097,450
1,200 Cato Corporation Cl. A..... 7,200
133,100 *Charming Shoppes, Inc..... 940,019
81,800 Claire's Stores, Inc....... 2,259,725
7,800 Dart Group Corporation Cl.
A........................ 694,200
130,400 Deb Shops Inc.............. 652,000
283,200 *The Dress Barn, Inc....... 2,973,600
207,900 Family Dollar Stores,
Inc...................... 3,612,263
80,500 Frederick's of Hollywood,
Inc. Cl. A............... 402,500
182,296 Frederick's of Hollywood,
Inc. Cl. B............... 820,332
57,000 *InterTAN Inc.............. 327,750
135,800 *Little Switzerland,
Inc...................... 712,950
88,000 *Mikasa, Inc............... 968,000
<CAPTION>
Shares Value
- ---------- ------------
<C> <S> <C>
49,830 *Monro Muffler Brake,
Inc...................... $ 915,623
15,900 Oshkosh B'Gosh, Inc. Cl.
A........................ 286,200
180,805 Pier 1 Imports, Inc........ 2,689,474
107,600 *Stein Mart, Inc........... 1,963,700
27,183 Strawbridge & Clothier Cl.
A........................ 441,724
127,800 *Suzy Shier Ltd............ 697,200
------------
26,098,348
------------
SERVICES -- 16.1%
33,340 Aceto Corporation.......... 525,105
79,712 Air Express International
Corporation.............. 2,251,864
149,948 Arnold Industries, Inc..... 2,136,759
37,200 Atlantic Southeast
Airlines, Inc............ 1,050,900
81,174 *Bell Industries, Inc...... 1,359,664
52,700 Bowl America Incorporated
Cl. A.................... 368,900
20,000 Bowne & Co., Inc........... 412,500
38,100 *Jenny Craig, Inc.......... 681,038
105,600 Dames & Moore.............. 1,280,400
103,400 Ennis Business Forms,
Inc...................... 1,176,175
119,900 *FRP Properties, Inc....... 2,457,950
167,800 *FCA International Ltd..... 285,069
2,600 Fisher Companies Inc....... 227,500
220,935 Frozen Food Express
Industries, Inc.......... 2,485,519
31,400 Gilbert Associates, Inc.
Cl. A.................... 400,350
13,417 Grey Advertising Inc....... 2,965,157
20,304 Hardinge Brothers, Inc..... 644,652
115,825 The Harper Group........... 2,258,587
76,100 *International Dairy Queen,
Inc. Cl. A............... 1,674,200
12,500 *Internation Family
Entertainment, Inc....... 231,250
72,850 *JOULE Inc................. 437,100
39,500 Kenan Transport Company.... 819,625
40,300 Lawson Products, Inc....... 1,017,575
115,500 *Marshall Industries....... 3,234,000
99,800 Merrill Corporation........ 2,495,000
98,300 *MovieFone, Inc. Cl. A..... 417,775
98,400 New England Business
Service, Inc............. 1,918,800
9,300 *Nichols Research
Corporation.............. 290,625
9,900 *PAYCO AMERICAN
CORPORATION.............. 86,625
72,600 Plenum Publishing
Corporation.............. 2,541,000
173,500 Richardson Electronics,
Ltd...................... 1,735,000
78,500 *Rollins Environmental
Services, Inc............ 304,188
53,000 Rykoff-Sexton, Inc......... 761,875
84,525 *SEATTLE FILMWORKS, Inc.... 1,373,531
155,000 Sotheby's Holdings, Inc.
Cl. A.................... 2,247,500
</TABLE>

The accompanying notes are an integral part of the financial statements.
14

Principal
Amount
- ----------
<C> <S> <C>
CORPORATE BONDS -- .8%
$ 824,000 Dixie Yarns, Inc. 7.00%
Conv. Sub. Deb. due
5/15/12.................. 626,240
314,000 Reliance Group Holdings,
Inc. 9.00% Sr. Note due
11/15/00................. 313,215
1,073,000 Richardson Electronics,
Ltd. 7.25% Conv. Sub.
Deb. due 12/15/06........ 912,050
1,458,000 Semi-Tech Corp 0% Sr. Secs.
Disc Note due 8/15/03.... 856,575
750,000 Shoney's, Inc. 0% Sub.
Conv. Deb. due 4/11/04... 341,250
------------
Total Corporate Bonds
(Cost $2,674,170)........ 3,049,330
------------

REPURCHASE AGREEMENT -- 8.6%
State Street Bank and Trust Company,
4.90% due 7/01/96, collateralized by
U.S. Treasury Notes, 5.25%, due
12/31/97, valued at $32,131,220 (Cost 31,500,000
$31,500,000)..........................
------------

TOTAL INVESTMENTS -- 111.4% (COST
$320,604,132)......................... 405,938,772

LIABILITIES LESS CASH AND OTHER
ASSETS -- (11.4%)..................... (41,510,568)
------------

NET ASSETS -- 100.0%.................... $364,428,204
------------
------------
</TABLE>

* Non-income producing.

** American Depository Receipt.

`D' At June 30, 1996, the Fund owned 5% or more of the Company's outstanding
shares thereby making the Company an affiliated person as that term is
defined in the Investment Company Act of 1940.

INCOME TAX INFORMATION -- The cost of total investments for federal income tax
purposes was $320,604,132. At June 30, 1996, net unrealized appreciation for all
securities was $85,334,640, consisting of aggregate gross unrealized
appreciation of $97,930,143 and aggregate gross unrealized depreciation of
$12,595,503.

The accompanying notes are an integral part of the financial statements.
15

<PAGE>
<PAGE>
ROYCE VALUE TRUST, INC.
STATEMENT OF ASSETS AND LIABILITIES (unaudited)
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
June 30, 1996
-------------

<S> <C>
ASSETS:
Investments at value (identified cost $320,604,132)....................................... $ 405,938,772
Cash...................................................................................... 143,207
Receivable for investments sold........................................................... 400,629
Receivable for dividends and interest..................................................... 596,506
Prepaid expenses and other assets......................................................... 96,857
-------------
Total Assets......................................................................... 407,175,971
-------------

LIABILITIES:
Notes payable............................................................................. 38,685,014
Interest payable.......................................................................... 1,150,000
Payable for investments purchased......................................................... 2,584,619
Investment advisory fee payable........................................................... 114,567
Accrued expenses.......................................................................... 213,567
-------------
Total Liabilities.................................................................... 42,747,767
-------------
Net Assets........................................................................... $ 364,428,204
-------------
-------------

ANALYSIS OF NET ASSETS:
Undistributed net investment income....................................................... $ 2,181,080
Accumulated net realized gain on investments.............................................. 22,313,646
Net unrealized appreciation on investments................................................ 85,334,640
Capital Stock (24,836,018 shares outstanding)............................................. 24,836
Additional paid-in capital................................................................ 254,574,002
-------------
Net Assets........................................................................... $ 364,428,204
-------------
-------------

PRICING OF SHARES:
Net asset value per share, assuming conversion of Notes
($403,113,218 [div] 27,843,537 fully converted shares).................................. $14.48
-------------
-------------
</TABLE>

The accompanying notes are an integral part of the financial statements.
16

<PAGE>
<PAGE>
ROYCE VALUE TRUST, INC.
STATEMENT OF OPERATIONS (unaudited)
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
Six Months
ended
June 30, 1996
-------------
<S> <C>
INVESTMENT INCOME:
Income:
Dividends.............................................................................. $ 3,172,647
Interest............................................................................... 687,359
-------------
Total Income...................................................................... 3,860,006
-------------
Expenses:
Investment advisory fee................................................................ 704,547
Interest expense....................................................................... 1,150,000
Amortization of underwriting discount and offering costs............................... 82,264
Administrative and office facilities expense........................................... 92,632
Custodian and transfer agent fees...................................................... 64,792
Professional fees...................................................................... 28,392
Directors' fees........................................................................ 24,934
Other expenses......................................................................... 153,274
-------------
Total Expenses.................................................................... 2,300,835
Fees waived by investment adviser................................................. (44,656)
-------------
Net Expenses...................................................................... 2,256,179
-------------
Net Investment Income............................................................. 1,603,827
-------------

REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain on investments....................................................... 19,234,136
Net unrealized appreciation on investments............................................. 4,619,890
-------------
Net realized and unrealized gain on investments................................... 23,854,026
-------------

NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........................................ $ 25,457,853
-------------
-------------
</TABLE>

The accompanying notes are an integral part of the financial statements.
17

<PAGE>
<PAGE>
ROYCE VALUE TRUST, INC.
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
Six Months Year
ended ended
June 30, 1996 December 31,
(unaudited) 1995
------------- ------------
<S> <C> <C>
FROM INVESTMENT OPERATIONS:
Net investment income.............................................. $ 1,603,827 $ 1,030,325
Net realized gain on investments................................... 19,234,136 32,580,075
Net unrealized appreciation on investments......................... 4,619,890 29,032,226
------------- ------------
Increase in net assets resulting from operations................... 25,457,853 62,642,626
Dividends paid from net investment income.......................... -- (693,347)
Distributions paid from net realized gain.......................... -- (29,124,623)
FROM CAPITAL STOCK TRANSACTIONS:
Increase in net assets from capital stock transactions............. -- 37,113,835
------------- ------------
INCREASE IN NET ASSETS.................................................. 25,457,853 69,938,491
NET ASSETS:
Beginning of period................................................ 338,970,351 269,031,860
------------- ------------
End of period (including undistributed net investment income of
$2,181,080 and $577,253, respectively)........................... $ 364,428,204 $338,970,351
------------- ------------
------------- ------------
</TABLE>

STATEMENT OF CASH FLOWS (unaudited)
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
Six Months
ended
June 30, 1996
-------------
<S> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Investment income received........................................................... $ 3,922,867
Interest paid........................................................................ (1,150,000)
Payment of operating expenses........................................................ (1,048,258)
Purchases of investments............................................................. (90,132,901)
Proceeds from sales and maturities of investments.................................... 88,551,499
-------------
Cash from operating activities.................................................. 143,207
Cash at beginning of period..................................................... 0
-------------
Cash at end of period........................................................... $ 143,207
-------------
-------------
RECONCILIATION OF NET INCREASE IN NET ASSETS RESULTING FROM
OPERATIONS TO CASH FROM OPERATING ACTIVITIES:
Net increase in net assets resulting from operations................................. $ 25,457,853
Net increase in investments.......................................................... (20,992,186)
Net increase in unrealized appreciation on investments............................... (4,619,890)
Decrease in dividends and interest receivable........................................ 62,861
Decrease in receivable for investments sold.......................................... 2,145,034
Accretion of offering costs.......................................................... 82,264
Decrease in payable for investments purchased........................................ (1,926,301)
Decrease in accrued expenses and other assets........................................ (66,428)
-------------
Cash from operating activities.................................................. $ 143,207
-------------
-------------
</TABLE>

The accompanying notes are an integral part of the financial statements.
18

<PAGE>
<PAGE>
ROYCE VALUE TRUST, INC.
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------

This table is presented to show selected data for a share outstanding
throughout each period, and to assist stockholders in evaluating the Fund's
performance.

<TABLE>
<CAPTION>
Six Months
ended Years ended December 31,
June 30, 1996 --------------------------------------------------------
(unaudited) 1995 1994 1993 1992 1991
------------- -------- -------- -------- -------- --------

<S> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD.... $ 13.56 $ 12.34 $ 13.47 $ 12.50 $ 11.23 $ 8.58
INCOME FROM INVESTMENT OPERATIONS(a):
Net investment income................. 0.07 0.04 0.04 0.09 0.15 0.17
Net realized and unrealized gain on
investments......................... 0.85 2.70 0.09 2.12 2.12 3.20
------------- -------- -------- -------- -------- --------
Total from investment operations.... 0.92 2.74 0.13 2.21 2.27 3.37
------------- -------- -------- -------- -------- --------
DIVIDENDS AND DISTRIBUTIONS FROM:
Net investment income................. -- (0.03) (0.01) (0.09) (0.15) (0.17)
Net realized gain on investments...... -- (1.26) (1.04) (1.06) (0.75) (0.44)
------------- -------- -------- -------- -------- --------
Total dividends and distributions... -- (1.29) (1.05) (1.15) (0.90) (0.61)
------------- -------- -------- -------- -------- --------
CAPITAL STOCK TRANSACTIONS:
Effect of rights offering............. -- (0.12) (0.14) (0.08) (0.06) (0.10)
Effect of reinvestment of
distributions....................... -- (0.11) (0.07)* (0.01) (0.04) (0.01)
------------- -------- -------- -------- -------- --------
Total capital stock transactions.... -- (0.23) (0.21) (0.09) (0.10) (0.11)
------------- -------- -------- -------- -------- --------
NET ASSET VALUE, END OF PERIOD (a)...... $ 14.48 $ 13.56 $ 12.34 $ 13.47 $ 12.50 $ 11.23
------------- -------- -------- -------- -------- --------
------------- -------- -------- -------- -------- --------
MARKET VALUE, END OF PERIOD............. $ 12.375 $ 11.875 $ 11.000 $ 12.875 $ 12.250 $ 10.375
------------- -------- -------- -------- -------- --------
------------- -------- -------- -------- -------- --------
TOTAL RETURN (b):
Net Asset Value (a)................... 6.8% 22.6% 1.1% 17.9% 19.9% 39.5%
Market Value.......................... 4.2% 20.5% - 5.6% 14.8% 26.8% 35.3%

RATIOS BASED ON AVERAGE NET ASSETS:
Total expenses(c)....................... 1.29%** 2.01% 2.01% 1.33% 0.81% 0.79%
Management fee expense.................. 0.38%** 0.97% 1.21% 1.09% 0.53% 0.43%
Interest expense........................ 0.70%** 0.75% 0.46% -- -- --
Other operating expenses................ 0.21%** 0.29% 0.34% 0.24% 0.28% 0.36%
Net investment income................... 0.92%** 0.34% 0.31% 0.74% 1.31% 1.52%

SUPPLEMENTAL DATA:
Net Assets, End of Period (in
thousands)............................ $364,428 $338,970 $269,032 $246,558 $202,483 $166,550
Portfolio Turnover Rate................. 13% 32% 35% 33% 40% 34%
Average Commission Rate Paid`D'......... $ 0.0574 -- -- -- -- --
</TABLE>

- ------------

(a) Commencing June 21, 1995, Net Asset Value per share, Net Asset Value Total
Return and Income from Investment Operations are calculated assuming the
Notes are fully converted except when the effect of doing so results in a
higher Net Asset Value per share than was calculated without such
assumption. If it were assumed the Notes had not been converted, the Net
Asset Value per share would have been increased by $0.12 at June 30, 1996
and $0.09 at December 31, 1995.

(b) The Net Asset Value and Market Value Total Return assume a continuous
stockholder who reinvested all net investment income dividends and capital
gain distributions and fully participated in primary rights offerings.

(c) Expense ratios before waiver of fees by the investment advisor would have
been 1.32% for the six months ended June 30, 1996, and 2.04% and 2.02% for
the years ended December 31, 1995 and 1994, respectively.

* Includes distributions paid January 31, 1994 and distributions paid December
30, 1994.

** Annualized.

`D' For fiscal years beginning on or after October 1, 1995, the Fund is
required to disclose its average commission rate paid per share for
purchases and sales of investments.

The accompanying notes are an integral part of the financial statements.
19

<PAGE>
<PAGE>
ROYCE VALUE TRUST, INC.
NOTES TO FINANCIAL STATEMENTS (unaudited)
- --------------------------------------------------------------------------------

NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

Royce Value Trust, Inc. (the 'Fund') was incorporated under the laws of the
State of Maryland on July 1, 1986 as a diversified closed-end investment
company. The Fund commenced operations on November 26, 1986.

Valuation of investments:

Securities listed on an exchange or on the Nasdaq National Market System
are valued on the basis of the last reported sale prior to the time the
valuation is made or, if no sale is reported for such day, at their bid price
for exchange-listed securities and at the average of their bid and asked prices
for Nasdaq securities. Quotations are taken from the market where the security
is primarily traded. Other over-the-counter securities for which market
quotations are readily available are valued at their bid price. Securities for
which market quotations are not readily available are valued at their fair value
under procedures established and supervised by the Fund's Board of Directors.
Bonds and other fixed income securities may be valued by reference to other
securities with comparable ratings, interest rates and maturities, using
established independent pricing services.

Investment transactions and related investment income:

Investment transactions are accounted for on the trade date and dividend
income is recorded on the ex-dividend date. Interest income is recorded on the
accrual basis. Realized gains and losses from investment transactions and
unrealized appreciation and depreciation of investments are determined on the
basis of identified cost for book and tax purposes.

For the six months ended June 30, 1996, net realized gain on investments of
$19,234,136 included $16,786,957 of net long-term gain and $2,447,179 of net
short-term gain.

Taxes:

As a qualified regulated investment company under Subchapter M of the
Internal Revenue Code, the Fund is not subject to income taxes to the extent
that it distributes substantially all of its taxable income for its fiscal year.
The schedule of investments includes information regarding income taxes under
the caption 'Income Tax Information'.

Distributions:

Dividend and capital gain distributions are recorded on the ex-dividend
date and paid annually in December. These distributions are determined in
accordance with income tax regulations which may differ from generally accepted
accounting principles. Permanent book and tax basis differences relating to
shareholder distributions will result in reclassification to paid-in capital and
may affect net investment income per share. Undistributed net investment income
may include temporary book and tax basis differences which will reverse in a
subsequent period. Any taxable income or gain remaining at fiscal year end is
distributed in the following year.

Repurchase agreements:

The Fund enters into repurchase agreements with respect to its portfolio
securities solely with State Street Bank and Trust Company ('SSB&T'), the
custodian of its assets. The Fund restricts repurchase agreements to maturities
of no more than seven days. Securities pledged as collateral for repurchase
agreements are held by SSB&T until maturity of the repurchase agreements.
Repurchase agreements could involve certain risks in the event of default or
insolvency of SSB&T, including possible delays or restrictions upon the ability
of the Fund to dispose of the underlying securities.

<PAGE>
<PAGE>
ROYCE VALUE TRUST, INC.
NOTES TO FINANCIAL STATEMENTS (unaudited) (continued)
- --------------------------------------------------------------------------------

NOTE 2. INVESTMENT COMPANY CONVERTIBLE NOTES:

The Fund issued $40,000,000 aggregate principal amount of Investment
Company Convertible Notes (the 'Notes') on June 22, 1994. The Fund received
proceeds of $38,350,000 after the deduction of the underwriting discount and
offering costs incurred by the Fund in connection with the issuance of the
Notes. The underwriting discount and the offering costs of $1,200,000 and
$450,000, respectively, are being accreted on a straight line basis over the
term of the Notes.

The Notes, which are unsecured obligations of the Fund, mature on June 30,
2004 and bear interest payable on June 30 and December 31 of each year
commencing with June 30, 1994 at the rate of 5 3/4% per annum. The Notes have
Aaa rating from Moody's Investors Services, Inc. ('Moody's').

The Notes are convertible into shares of Common Stock of the Fund at the
option of the holder, at any time prior to maturity, except during the period
from the second trading day prior to the ex-dividend date through the last day
of each year unless an earlier date is selected by the Fund, and unless
previously redeemed at the option of the Fund. The conversion price at June 30,
1996 is $13.30 per share. This conversion price is subject to an annual net
adjustment involving an escalation of 6.75% and a reduction for the impact on
net asset value per share of distributions to stockholders.

Under the Investment Company Act of 1940, the Fund is required to maintain
an asset coverage of at least 300% for the Notes. In addition, the Indenture
governing the Notes requires the Fund to maintain a certain discounted asset
coverage for its portfolio that equals or exceeds the Basic Maintenance Amount
under the guidelines established by Moody's. The Fund has met these requirements
since the issuance of the Notes.

Commencing July 1, 1997, and any time thereafter prior to maturity, the
Fund may, at its option, redeem the Notes in whole or in part for cash at a
price equal to 100% of their principal amount, together with accrued interest
thereon. Prior to July 1, 1997, the Fund will have the option to redeem the
Notes for cash at a price equal to 100% of their principal amount, together with
accrued interest, only if a redemption is necessary for the Fund to maintain the
required asset coverage for the Notes and/or continue to qualify as a regulated
investment company.

Only July 1, 1999, if the average market price per $1,000 principal amount
of Notes for the 45 trading days ending May 31, 1999 is less than $950, the Fund
will either call all of the Notes for redemption or reset one or more of the
terms of the Notes so that the market value of the Notes is at or as close as
possible to par.

NOTE 3. INVESTMENT ADVISORY AGREEMENT:

Under the Investment Advisory Agreement between Quest Advisory Corp.
('Quest') and the Fund effective through June 30, 1996, the Basic Fee is a
monthly fee equal to 1/12 of 1% (1% on an annualized basis) of the average of
the total net assets of the Fund at the end of each month included in the
applicable performance period, which is a rolling 36 month period ending with
the most recent calendar month.

The Basic Fee for such monthly period is subject to increase or decrease,
depending on the extent, if any, by which the investment performance of the Fund
exceeds by more than 2 percentage points, or is exceeded by more than 1
percentage point, by the percentage change in the investment record of the S&P
500 for such performance period. For each percentage point in excess of 2 that
the investment performance of the Fund exceeds the percentage change in the
investment record of the S&P 500, such Basic Fee is increased at the rate of
1/12 of .05%. For each percentage point in excess of 1 that the percentage
change in the investment record of the S&P 500 exceeds the investment
performance of the Fund, such Basic Fee is decreased at the rate of 1/12 of .1%.

<PAGE>
<PAGE>
ROYCE VALUE TRUST, INC.
NOTES TO FINANCIAL STATEMENTS (unaudited) (continued)
- --------------------------------------------------------------------------------

The maximum increase or decrease in the Basic Fee for any month may not
exceed 1/12 of .5%. Accordingly, the maximum monthly fee rate as adjusted for
performance is 1/12 of 1.5% and would be payable if the investment performance
of the Fund exceeded the percentage change in the investment record of the S&P
500 by 12 or more percentage points for the performance period. The minimum
monthly fee rate as adjusted for performance is 1/12 of .5% and would be payable
if the percentage change in the investment record of the S&P 500 exceeded the
investment performance of the Fund by 6 or more percentage points for the
performance period.

The Investment Advisory Agreement also provides that Quest will not be
entitled to receive any fees for any performance period in which the investment
performance of the Fund, rounded to the nearest whole point, is less than zero.
In the event that the Fund's investment performance for a performance period,
rounded to the nearest whole point, is less than zero, Quest will not be
required to refund to the Fund any fees earned for any prior performance period.

In calculating the investment performance of the Fund and the percentage
change in the investment record of the S&P 500, all dividends and other
distributions during the performance period are treated as having been
reinvested and gain (loss) from transactions in Fund shares is eliminated.
Fractions of a percentage point are rounded to the nearest whole point (to the
higher whole point if exactly one-half).

For the six months ended June 30, 1996, the Fund paid Quest advisory fees
totalling $659,891 which is net of $44,656 voluntarily waived by Quest.

Effective July 1, 1996, the Fund entered into a new Investment Advisory
Agreement with Quest which changed, among other things, the benchmark index to
the S&P 600 and changed the rate of decrease in the Agreement to be equal to the
rate of increase.

NOTE 4. TRANSACTIONS IN SHARES OF AFFILIATED COMPANIES:

An 'Affiliated Company', as defined in the Investment Company Act of 1940,
is a company in which the Fund owns at least 5% of the company's outstanding
voting securities. The Fund effected the following transactions in shares of
such companies during the six months ended June 30, 1996.

<TABLE>
<CAPTION>
Purchases Sales
------------------- ------------------- Realized Dividend
Affiliated Company Shares Cost Shares Cost Gain/Loss Income
- ------------------------------ ------- -------- ------- -------- --------- --------
<S> <C> <C> <C> <C> <C> <C>
General Builders Corp......... -- -- -- -- -- --
Sage Laboratories, Inc........ -- -- -- -- -- --
United Services
Advisers, Inc............... -- -- 249,205 $436,109 -- --
</TABLE>

NOTE 5. FUND SHARES:

At June 30, 1996, there were 150,000,000 shares of common stock and
50,000,000 shares of preferred stock, $.001 par value, authorized. Only common
stock has been issued, and transactions were as follows:

<TABLE>
<CAPTION>
Six Months ended
June 30, 1996 Year ended
(unaudited) December 31, 1995
------------------------ ------------------------
Shares Amount Shares Amount
--------- ----------- --------- -----------
<S> <C> <C> <C> <C>
Net proceeds from rights offerings............ -- -- 1,308,387 $16,244,838
Dividends and distributions reinvested in
additional shares........................... -- -- 1,721,155 20,868,997
</TABLE>

During the year ended December 31, 1995, the Fund completed a rights
offering of 1,308,387 shares to its stockholders at the rate of one share for
each twenty rights held by stockholders of record on September 20, 1995.

<PAGE>
<PAGE>
ROYCE VALUE TRUST, INC.
NOTES TO FINANCIAL STATEMENTS (unaudited) (continued)
- --------------------------------------------------------------------------------

NOTE 6. PURCHASES AND SALES OF SECURITIES:

For the six months ended June 30, 1996, the cost of purchases and proceeds
from sales of investment securities, other than short-term securities, amounted
to $58,632,901 and $66,626,851, respectively.

At the Annual Meeting of Stockholders held on June 26, 1996, Fund
stockholders elected directors, ratified the Board's selection of the Fund's
independent public accountants for 1996, and approved the following proposals:

<TABLE>
<CAPTION>
Proposal/ Votes Votes Votes Cast Votes
Name of Director Cast For Withheld Against Abstained
- --------------------------------------------- ---------- -------- ---------- ---------

<S> <C> <C> <C> <C>
Proposal to approve new Investment Advisory
Agreement with Quest Advisory Corp. ....... 19,036,178 N/A 595,061 370,906

Proposal to change the Fund's investment
policy concerning warrants, rights and
options.................................... 13,330,499 N/A 634,457 537,072

Ratification of independent public ac-
countants.................................. 19,737,602 N/A 81,359 183,184

Charles M. Royce............................. 19,751,866 250,279 N/A N/A
Thomas R. Ebright............................ 19,655,377 346,768 N/A N/A
Richard M. Galkin............................ 19,657,300 344,845 N/A N/A
Stephen L. Isaacs............................ 19,676,454 325,691 N/A N/A
David L. Meister............................. 19,675,370 326,775 N/A N/A
</TABLE>

OFFICERS
Charles M. Royce, President and Treasurer
Jack E. Fockler, Jr., Vice President
W. Whitney George, Vice President
Daniel A. O'Byrne, Vice President
& Assistant Secretary
John E. Denneen, Secretary

INDEPENDENT ACCOUNTANTS
Ernst & Young LLP

CUSTODIAN, TRANSFER AGENT
AND REGISTRAR
State Street Bank and Trust Company

DIRECTORS
Thomas R. Ebright
Quest Advisory Corp., Vice President
Royce, Ebright & Associates, Inc., President

Richard M. Galkin
Richard M. Galkin Associates Inc.,
President

Stephen L. Isaacs
Columbia University Development Law and
Policy Program, Director; Attorney

David L. Meister
Communications Industry, Consultant

Charles M. Royce
Quest Advisory Corp., President

Royce Value Trust, Inc.
Semi-Annual Report 1996
1414 Avenue of the Americas
New York, New York 10019
(800) 221-4268

STATEMENT OF DIFFERENCES
------------------------

The dagger symbol shall be expressed as..... `D'
The division sign shall be expressed as..... [div]

GRAPHIC APPENDIX

On page 2 of the paper format Royce Value Trust report:
Picture of firecracker exploding

On page 3 of the paper format Royce Value Trust report:
A picture of a Prospectus cover of Berkshire Hathaway Inc.

On page 4 of the paper format Royce Value Trust report:
A picture of a scale balancing a dollar sign and a factory.

On page 5 of the paper format Royce Value Trust report:
A picture of a man in long white coat pointing with a pointer.
A picture of Cupid shooting an arrow with two hearts around him.

On page 6 of the paper format Royce Value Trust report:
A picture of a basket of fruit at harvest time.
A bar graph of the Russell 2000 price variations from 1979 to 1996.
A picture of a ticker tape machine.