DREYFUS PREMIER STATE MUNICIPAL BOND FUND, VIRGINIA SERIES
- -----------------------------------------------------------------------------
LETTER TO SHAREHOLDERS
Dear Shareholder:
We are pleased to report the performance for the Dreyfus Premier State
Municipal Bond Fund--Virginia Series for the six-month reporting period ended
October 31, 1998, as shown in the following table:
<TABLE>
ANNUALIZED
TOTAL RETURN* DISTRIBUTION RATE**
___________ _______________
<S> <C> <C>
Class A shares . . . . . . . . . . . . . . . . . . . . 4.42% 4.64%
Class B shares . . . . . . . . . . . . . . . . . . . . 4.16% 4.35%
Class C shares . . . . . . . . . . . . . . . . . . . . 4.09% 4.10%
</TABLE>
ECONOMIC REVIEW
In the face of soaring consumer confidence and strong first-quarter economic
growth, the Federal Reserve Board earlier this year refrained from increasing
interest rates, partially to avoid further roiling international financial
markets. In addition, the Fed evidently felt then that the economic slowdown
overseas might curtail the U.S. economy to some degree, which would alleviate
the need for monetary restraint. The Fed's expectations have proven to be true,
and its judgment accurate. The U.S. balance of trade has worsened and there have
been increasing signs of a slowdown in export-related industries. On September
29, concerns about a weakening U.S. economy caused the Federal Open Market
Committee (the F.O.M.C. is the policy-making arm of the Fed) to pare the Federal
Funds target rate by 25 basis points, the first reduction since January 1996.
(The Federal Funds rate is the rate of interest that banks charge each other for
overnight loans.) At that point, Fed Chairman Alan Greenspan described the
economic outlook for the United States as having "weakened measurably." Two
weeks later, on October 15, the F.O.M.C. again reduced its target rate by an
additional quarter point, putting the Federal Funds rate at 5.0%.
Despite the concerns of the Fed regarding an economic slowdown, aggregate
economic statistics showed a growing and resilient economy during the reporting
period. Low unemployment and negligible inflation, combined with car makers
rebuilding inventory after a long strike and rising consumer incomes, resulted
in solid economic growth (3.3% ) for the third quarter of this year. While a
significant portion of this gain was due to inventory replenishment after the
automobile strike, the overall results were still an improvement over
second-quarter economic growth of 1.8%. Inflation as measured by the Consumer
Price Index remained at levels not witnessed since 1963.
The Fed's responsibility is to enact monetary policy that is anticipatory of
future economic conditions. The U.S. trade deficit has continued to widen
because of the global economic slide. Slumping exports have weakened
manufacturing activity since midyear and there is concern that this slackness
could become more pronounced and widen into other sectors of the economy. While
the increase in imports also restrains domestic production, it has helped
contain inflation as well, since domestic producers are reluctant to raise
prices. This provides additional flexibility for the Fed to lower interest rates
still further. So far, economic problems overseas have not caused any measurable
reaction in the U.S. labor market. Only the growth rate in new jobs has eased
from its torrid pace earlier in the year. The unemployment rate has remained
near 30-year lows and worker inflation-adjusted take-home pay has been rising.
The condition of the labor market is a key determinant of consumer confidence
which, of course, relates directly to consumer spending, a force that accounts
for two thirds of all economic activity. Business spending has shown signs of
weakness, so the role of the consumer will be of even greater importance in the
future. It is significant that measures of consumer confidence have receded from
earlier record high levels, largely because of concerns about the volatility of
financial markets.
MARKET ENVIRONMENT
The general fixed-income markets have traded off in a downward-spiked pattern
since appreciating dramatically and topping in mid October. Market participants
have been greatly influenced by the overall trend to perceived safer securities
(mainly Treasury notes and bonds) incited by the Asian economic crisis. This
crisis has prompted notions of domestic economic contraction, creating the
perception that bonds whose credit quality is dependent on the business cycle
are vulnerable. Therefore, many securities, such as corporate, mortgage, asset
backed, or project related bonds, have traded off in this period. Currently, the
expectation is that the interest rate spreads of these types of securities and
Treasuries will remain wide. Additionally, the recent exaggerated nature of
short-term price performance (both up and down) was greatly influenced by the
financial problems of leveraged-hedge funds and the quick response by the
Federal Reserve. The municipal market focused on these trends and its
participants initially benefited from the same direction though not to the same
level of appreciation, as the Treasury bond markets. Correspondingly, in the
market' s recent price decline, municipals outperformed Treasuries, maintaining
more of their value.
PORTFOLIO OVERVIEW
In the past, your Fund has been a responder to the supply and demand pressure
dynamic of the tax-exempt bond market. New issuance, usually our primary
concern, was replaced by the fundamental concerns of interest rate trends and
the previously mentioned widening of interest rate levels among different
classes of bonds.
As a protective measure, some high-quality, highly liquid securities were
added to your Fund. Bonds that could erode in price due to the current market
sentiment were replaced. Likewise, bonds with short call features on premium
priced positions that bring prices down with the passing of time were traded.
These exchanges were accomplished at a modest change in yield in most
circumstances. This new balance leaves many defensive securities in the
portfolio, which is appropriate in a scenario where recent Fed rate cuts have
primarily enhanced the value of the equity markets and not the bond market.
However, if there is another upward price rally in fixed income, the newly added
bonds will participate.
Included in this report is a series of detailed financial statements, which
outline the Fund' s current holdings and its financial condition. We hope that
you find them informative.
Very truly yours,
[Richard J. Moynihan signature]
Richard J. Moynihan
Director, Municipal Portfolio Management
The Dreyfus Corporation
November 16, 1998
New York, N.Y.
*Total return includes reinvestment of dividends and any capital gains paid,
and does not take into consideration the maximum initial sales charge in the
case of Class A shares, or the applicable contingent deferred sales charge
imposed on redemptions in the case of Class B and Class C shares. Income may be
subject to state and local income taxes for non-Virginia residents.
**Distribution rate per share is based upon dividends per share paid from net
investment income during the period (annualized) , divided by the maximum
offering price per share at the end of the period in the case of Class A shares,
or the net asset value per share in the case of Class B and Class C shares. Some
income may be subject to the Federal Alternative Minimum Tax (AMT) for certain
shareholders.
<TABLE>
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, VIRGINIA SERIES
- -----------------------------------------------------------------------------
STATEMENT OF INVESTMENTS OCTOBER 31,1998 (UNAUDITED)
Principal
Long-Term Municipal Investments--97.8%% Amount Value
- ------------------------------------------------------- _____________ _____________
<S> <C> <C>
Virginia--70.0%
Alexandria Redevelopment and Housing Authority,
Multi-Family Housing Mortgage Revenue (Buckingham Village Apartments)
6.125%, 7/1/2021 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $3,000,000 $3,139,950
Beford County Industrial Development Authority,
IDR, Refunding (Nekossa Packaging Corp. Project)
5.60%, 12/1/2025 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,500,000 4,555,800
Chesapeake Bay Bridge and Tunnel Commission District, Revenue, Refunding
General Resolution 5.50%, 7/1/2025 (Insured; MBIA) . . . . . . . . . . . . . . . . . . . 2,500,000 2,731,625
Covington-Alleghany County Industrial Development Authority,
Hospital Facility Revenue (Alleghany Regional Hospital)
6.875%, 4/1/2022 (Prerefunded 4/1/2002) (a) . . . . . . . . . . . . . . . . . . . . . . 1,000,000 1,116,300
Dinwiddie County Industrial Development Authority, LR
(Dinwiddie County School Facilities Project) 6%, 2/1/2018 . . . . . . . . . . . . . . . 500,000 532,865
Dulles Town Center Community Development Authority,
Special Assessment Tax (Dulles Town Center Project)
6.25%, 3/1/2026 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,000,000 3,083,100
Fairfax County Redevelopment and Housing Authority, MFHR, Refunding
(Paul Spring Retirement Center):
5.90%, 6/15/2017 (Insured; FHA) . . . . . . . . . . . . . . . . . . . . . . . . . . . 200,000 213,236
6%, 12/15/2028 (Insured; FHA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 600,000 638,982
Fairfax County Park Authority, Park Facilities Revenue
6.625%, 7/15/2020 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,665,000 2,876,734
Fairfax County Water Authority, Water Revenue
7.397%, 4/1/2029 (b,c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,000,000 2,201,700
Industrial Development Authority of the City of Hopewell,
Health Care Facility Refunding Revenue:
(Colonial Heights Convalescent Center Project) 5.60%, 10/1/2003 . . . . . . . . . . . . 205,000 211,566
(Forest Hill Convalescent Center Project):
6%, 10/1/2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 260,000 273,746
6.15%, 10/1/2007 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 280,000 296,346
6.25%, 10/1/2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 115,000 121,932
(Westport Convalescent Center Project):
5.90%, 10/1/2005 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 315,000 329,953
6.15%, 10/1/2007 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 175,000 185,216
6.25%, 10/1/2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 410,000 434,715
Industrial Development Authority of Giles County,
Exempt Facility Revenue (Hoechst Celanese Corp. Project)
5.95%, 12/1/2025 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,000,000 3,164,460
Industrial Development Authority of the County of Henrico, SWDR
(Browning-Ferris Industries of South Atlantic, Inc. Project)
5.45%, 1/1/2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,500,000 3,702,160
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, VIRGINIA SERIES
- -----------------------------------------------------------------------------
STATEMENT OF INVESTMENTS (CONTINUED) OCTOBER 31,1998 (UNAUDITED)
Principal
Long-Term Municipal Investments (continued) Amount Value
- ------------------------------------------------------- _____________ _____________
Virginia (continued)
Industrial Development Authority of the County of Prince William, Revenue:
Hospital Facility (Potomac Hospital Corp. of Prince William)
6.85%, 10/1/2025 (Prerefunded 10/1/2005) (a) . . . . . . . . . . . . . . . . . . . . . $ 1,000,000 $ 1,188,700
Refunding (Potomac Place) 6.25%, 12/20/2027 . . . . . . . . . . . . . . . . . . . . . . 700,000 762,118
Residential Care Facility (First Mortgage-Westminster Lake Ridge)
6.625%, 1/1/2026 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,500,000 3,694,355
Industrial Development Authority of the City of Winchester, Residential Care
Facility
First Mortgage Revenue (Westminster--Canterbury):
5.75%, 1/1/2018 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,000,000 1,007,650
5.75%, 1/1/2027 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,750,000 3,768,975
Industrial Development Authority of the Town of West Point, SWDR
(Chesapeake Corp. Project) 6.375%, 3/1/2019 . . . . . . . . . . . . . . . . . . . . . . 2,500,000 2,682,350
Isle Wight County Industrial Development Authority,
Solid Waste Disposal Facilities Revenue (Union Camp Corp. Project)
6.10%, 5/1/2027 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,500,000 3,733,485
Loudoun County Sanitation Authority, Water and Sewer Revenue
4.75%, 1/1/2021 (Insured; MBIA) (d) . . . . . . . . . . . . . . . . . . . . . . . . . . 1,000,000 966,010
Metropolitan Washington Airports Authority, Airport System Revenue
5.50%, 10/1/2023 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,000,000 2,062,040
Prince William County Park Authority, Revenue
6.875%, 10/15/2016 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,000,000 3,403,740
Richmond Metropolitan Authority, Expressway Revenue, Refunding
5.25%, 7/15/2017 (Insured; FGIC) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,100,000 3,268,764
Staunton Industrial Development Authority,
Educational Facilities Revenue, Refunding (Mary Baldwin College)
6.75%, 11/1/2021 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,145,000 3,440,221
University of Virginia, University Revenue
5.75%, 5/1/2021 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,325,000 2,505,769
Upper Occoquan Sewer Authority, Regional Sewer Revenue
5.15%, 7/1/2020 (Insured; MBIA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,000,000 2,075,680
Virginia Beach Development Authority, Revenue:
Industrial Development Mortgage Refunding (Ramada Oceanside Resort)
8%, 8/1/2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 310,000 342,104
Nursing Home (Sentara Life Care Corp.) 7.75%, 11/1/2021 . . . . . . . . . . . . . . . . 1,000,000 1,111,570
Virginia College Building Authority, Educational Facilities Revenue
(Public Higher Education Financing Program) 4.80%, 9/1/2018 . . . . . . . . . . . . . . 2,395,000 2,360,201
Virginia Housing Development Authority, Commonwealth Mortgage:
6.60%, 7/1/2020 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,900,000 3,051,409
5.50%, 1/1/2022 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,500,000 2,554,225
6.85%, 1/1/2027 (Prerefunded 11/1/1998) (a) . . . . . . . . . . . . . . . . . . . . . . 1,935,000 1,935,194
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, VIRGINIA SERIES
- -----------------------------------------------------------------------------
STATEMENT OF INVESTMENTS (CONTINUED) OCTOBER 31,1998 (UNAUDITED)
Principal
Long-Term Municipal Investments (continued) Amount Value
- ------------------------------------------------------- _____________ _____________
U. S. Related--27.8%
Commonwealth of Puerto Rico (Public Improvement):
6.80%, 7/1/2021 (Prerefunded 7/1/2002) (a) . . . . . . . . . . . . . . . . . . . . . . . $ 1,000,000 $ 1,123,760
6%, 7/1/2026 (Prerefunded 7/1/2007) (a) . . . . . . . . . . . . . . . . . . . . . . . . 1,500,000 1,732,035
Guam Airport Authority, Revenue 6.70%, 10/1/2023 . . . . . . . . . . . . . . . . . . . . . 2,000,000 2,190,320
Puerto Rico Electric Power Authority, Power Revenue:
5%, 7/1/2012 (Insured; MBIA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50,000 52,363
6.203%, 7/1/2012 (b,c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,000,000 3,283,560
Puerto Rico Highway and Transportation Authority, Highway Revenue:
6.625%, 7/1/2018 (Prerefunded 7/1/2002) (a) . . . . . . . . . . . . . . . . . . . . . . 2,000,000 2,235,720
5.50%, 7/1/2026 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,500,000 3,658,585
Refunding 6.25%, 7/1/2015 (Insured; MBIA) . . . . . . . . . . . . . . . . . . . . . . . 2,000,000 2,359,200
Puerto Rico Ports Authority, Special Facilities Revenue
(American Airlines) 6.25%, 6/1/2026 . . . . . . . . . . . . . . . . . . . . . . . . . . 3,000,000 3,238,800
Virgin Islands Public Finance Authority, Revenue, Refunding, Fund Loan Notes:
Matching 7.25%, 10/1/2018 (Prerefunded 10/1/2002) (a) . . . . . . . . . . . . . . . . . 4,000,000 4,587,560
Senior Lien 5.50%, 10/1/2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,000,000 2,058,100
Virgin Islands Territory (Hugo Insurance Claims Fund Program)
7.75%, 10/1/2006 (Prerefunded 10/1/2001) (a) . . . . . . . . . . . . . . . . . . . . . . 1,335,000 1,469,488
Virgin Islands Water and Power Authority, Electric System
7.40%, 7/1/2011 (Prerefunded 7/1/2001) (a) . . . . . . . . . . . . . . . . . . . . . . . 1,855,000 2,043,932
_____________
TOTAL INVESTMENTS (cost $99,403,830) . . . . . . . . . . . . . . . . . . . . . . . . . . . 97.8% $105,758,369
_______ _____________
CASH AND RECEIVABLES (NET) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2% $ 2,377,094
_______ _____________
NET ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100.0% $108,135,463
_______ _____________
SEE NOTES TO FINANCIAL STATEMENTS.
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, VIRGINIA SERIES
- -----------------------------------------------------------------------------
Summary of Abbreviations
- -----------------------------------------------------------------------------
FGIC Financial Guaranty Insurance Company MBIA Municipal Bond Investors
FHA Federal Housing Administration Assurance Insurance Corporation
IDR Industrial Development Revenue MFHR Multi-Family Housing Revenue
LR Lease Revenue SWDR Solid Waste Disposal Revenue
Summary of Combined Ratings (Unaudited)
- -----------------------------------------------------------------------------
Fitch or Moody's or Standard & Poor's Percentage of Value
_______ ________ _________________ ___________________
AAA Aaa AAA 18.3%
AA Aa AA 16.8
A A A 19.7
BBB Baa BBB 18.6
Not Rated (e) Not Rated (e) Not Rated (e) 26.6
_______
100.0%
_______
Notes to Statement of Investments:
- -----------------------------------------------------------------------------
(a) Bonds which are prerefunded are collateralized by U.S. Government
securities which are held in escrow and are used to pay principal and
interest on the municipal issue and to retire the bonds in full at the
earliest refunding date.
(b) Inverse Floater Security--the interest rate is subject to change
periodically.
(c) Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At October 31,
1998, these securities amounted to $5,485,260 or 5.1% of net assets.
(d) Purchased on a delayed delivery basis.
(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.
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<TABLE>
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, VIRGINIA SERIES
- -----------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES OCTOBER 31, 1998 (UNAUDITED)
Cost Value
_____________ _____________
<S> <C> <C>
ASSETS: Investments in securities--See Statement of Investments . . $ 99,403,830 $105,758,369
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . 1,656,568
Interest receivable . . . . . . . . . . . . . . . . . . . 1,728,278
Receivable for shares of Beneficial Interest subscribed . . 69,594
Prepaid expenses . . . . . . . . . . . . . . . . . . . . 10,569
_____________
109,223,378
_____________
LIABILITIES: Due to The Dreyfus Corporation and affiliates . . . . . . 50,645
Due to Distributor . . . . . . . . . . . . . . . . . . . 41,745
Payable for investment securities purchased . . . . . . . 969,724
Payable for shares of Beneficial Interest redeemed . . . 7,210
Accrued expenses . . . . . . . . . . . . . . . . . . . . 18,591
_____________
1,087,915
_____________
NET ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $108,135,463
_____________
REPRESENTED BY: Paid-in capital . . . . . . . . . . . . . . . . . . . . . $100,322,865
Accumulated net realized gain (loss) on investments . . . 1,458,059
Accumulated net unrealized appreciation (depreciation)
on investments--Note 4 . . . . . . . . . . . . . . . . 6,354,539
_____________
NET ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $108,135,463
_____________
NET ASSET VALUE PER SHARE
----------------------------------------
Class A Class B Class C
____________ ______________ ______________
Net Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $65,522,292 $39,874,527 $2,738,644
Shares Outstanding . . . . . . . . . . . . . . . . . . . . . . . . . . 3,701,205 2,252,520 154,767
NET ASSET VALUE PER SHARE. . . . . . . . . . . . . . . . . . . . . . . $17.70 $17.70 $17.70
_______ _______ _______
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<TABLE>
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, VIRGINIA SERIES
- -----------------------------------------------------------------------------
STATEMENT OF OPERATIONS SIX MONTHS ENDED OCTOBER 31, 1998 (UNAUDITED)
INVESTMENT INCOME
<S> <C> <C>
INCOME Interest Income . . . . . . . . . . . . . . . . . . . . . $3,150,324
EXPENSES: Management fee--Note 3(a) . . . . . . . . . . . . . . . . $299,571
Shareholder servicing costs--Note 3(c) . . . . . . . . . 169,031
Distribution fees--Note 3(b) . . . . . . . . . . . . . . 109,886
Registration fees . . . . . . . . . . . . . . . . . . . . 7,330
Professional fees . . . . . . . . . . . . . . . . . . . . 5,994
Custodian fees . . . . . . . . . . . . . . . . . . . . . 5,656
Prospectus and shareholders' reports . . . . . . . . . . 4,091
Trustees' fees and expenses--Note 3(d) . . . . . . . . . 645
Loan commitment fees--Note 2 . . . . . . . . . . . . . . 261
Miscellaneous . . . . . . . . . . . . . . . . . . . . . . 5,248
___________
Total Expenses . . . . . . . . . . . . . . . . . . . . 607,713
___________
INVESTMENT INCOME--NET . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,542,611
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS--Note 4:
Net realized gain (loss) on investments . . . . . . . . . $1,369,101
Net unrealized appreciation (depreciation) on investments . . 678,833
___________
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS . . . . . . . . . . . . . . . . . . 2,047,934
___________
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS . . . . . . . . . . . . . . . . . . . $4,590,545
___________
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<TABLE>
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, VIRGINIA SERIES
- -----------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
Six Months Ended
October 31, 1998 Year Ended
(Unaudited) April 30, 1998
________________ _______________
<S> <C> <C>
OPERATIONS:
Investment income--net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2,542,611 $ 5,109,173
Net realized gain (loss) on investments . . . . . . . . . . . . . . . . . . . . . 1,369,101 716,552
Net unrealized appreciation (depreciation) on investments . . . . . . . . . . . . 678,833 3,846,818
_____________ _____________
Net Increase (Decrease) in Net Assets Resulting from Operations . . . . . 4,590,545 9,672,543
_____________ _____________
DIVIDENDS TO SHAREHOLDERS FROM:
Investment income--net:
Class A shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,612,258) (3,257,087)
Class B shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (881,136) (1,798,219)
Class C shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (49,217) (53,867)
Net realized gain on investments:
Class A shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ---- (11,050)
Class B shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ---- (6,895)
Class C shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ---- (231)
_____________ _____________
Total Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,542,611) (5,127,349)
_____________ _____________
BENEFICIAL INTEREST TRANSACTIONS:
Net proceeds from shares sold:
Class A shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,581,149 5,997,540
Class B shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,702,557 5,831,012
Class C shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 874,664 1,286,247
Dividends reinvested:
Class A shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 818,593 1,642,346
Class B shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 436,611 888,868
Class C shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,372 11,545
Cost of shares redeemed:
Class A shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (4,203,820) (6,456,984)
Class B shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3,127,793) (4,112,867)
Class C shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (181,964) (11,835)
_____________ _____________
Increase (Decrease) in Net Assets from Beneficial Interest Transactions . (1,093,631) 5,075,872
_____________ _____________
Total Increase (Decrease) in Net Assets . . . . . . . . . . . . . . . . 954,303 9,621,066
NET ASSETS:
Beginning of Period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107,181,160 97,560,094
_____________ _____________
End of Period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $108,135,463 $107,181,160
_____________ _____________
SEE NOTES TO FINANCIAL STATEMENTS.
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, VIRGINIA SERIES
- -----------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS (CONTINUED)
Shares
______________________________
Six Months Ended
October 31, 1998 Year Ended
(Unaudited) April 30, 1998
________________ _______________
CAPITAL SHARE TRANSACTIONS:
Class A
________
Shares sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 146,668 346,087
Shares issued for dividends reinvested . . . . . . . . . . . . . . . . . . . . . . . 46,343 94,990
Shares redeemed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (238,901) (373,556)
________ __________
Net Increase (Decrease) in Shares Outstanding . . . . . . . . . . . . . . . . . . (45,890) 67,521
________ __________
Class B
________
Shares sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96,586 339,021
Shares issued for dividends reinvested . . . . . . . . . . . . . . . . . . . . . . . 24,719 51,407
Shares redeemed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (177,484) (236,978)
________ __________
Net Increase (Decrease) in Shares Outstanding . . . . . . . . . . . . . . . . . . (56,179) 153,450
________ __________
Class C
________
Shares sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49,777 74,375
Shares issued for dividends reinvested . . . . . . . . . . . . . . . . . . . . . . . 361 668
Shares redeemed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (10,326) (682)
________ __________
Net Increase (Decrease) in Shares Outstanding . . . . . . . . . . . . . . . . . . 39,812 74,361
________ __________
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<TABLE>
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, VIRGINIA SERIES
- -----------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
Contained below is per share operating performance data for a share of
Beneficial Interest outstanding, total investment return, ratios to average net
assets and other supplemental data for each period indicated. This information
has been derived from the Fund's financial statements.
Class A Shares
_________________________________________________________________
Six Months Ended
October 31, 1998 Year Ended April 30,
_____________________________________________
PER SHARE DATA: (Unaudited) 1998 1997 1996 1995 1994
__________ ______ ______ ______ ______ ______
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period . . . . . . $17.37 $16.61 $16.27 $16.03 $16.02 $16.80
______ ______ ______ ______ ______ ______
Investment Operations:
Investment income--net . . . . . . . . . . . . . .43 .88 .94 .93 .94 .97
Net realized and unrealized gain (loss)
on investments . . . . . . . . . . . . . . . .33 .76 .34 .24 .04 (.75)
______ ______ ______ ______ ______ ______
Total from Investment Operations . . . . . . . . .76 1.64 1.28 1.17 .98 .22
______ ______ ______ ______ ______ ______
Distributions:
Dividends from investment income--net . . . . . . (.43) (.88) (.94) (.93) (.94) (.97)
Dividends from net realized gain on investments . . -- (.00)(1) -- -- -- (.01)
Dividends in excess of net realized gain
on investments . . . . . . . . . . . . . . . -- -- -- -- (.03) (.02)
______ ______ ______ ______ ______ ______
Total Distributions . . . . . . . . . . . . . . . (.43) (.88) (.94) (.93) (.97) (1.00)
______ ______ ______ ______ ______ ______
Net asset value, end of period . . . . . . . . . $17.70 $17.37 $16.61 $16.27 $16.03 $16.02
______ ______ ______ ______ ______ ______
TOTAL INVESTMENT RETURN(2) . . . . . . . . . . . . . 8.77%(3) 10.05% 8.02% 7.32% 6.39% 1.10%
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets . . . . . .91%(3) .75% .39% .50% .39% .46%
Ratio of net investment income
to average net assets . . . . . . . . . . . . 4.87%(3) 5.10% 5.67% 5.58% 5.93% 5.64%
Decrease reflected in above expense ratios
due to undertakings by the Manager . . . . . -- .14% .55% .55% .55% .55%
Portfolio Turnover Rate . . . . . . . . . . . . . 17.54%(4) 21.25% 45.29% 50.06% 21.60% 30.69%
Net Assets, end of period (000's Omitted) . . . . $65,522 $ 65,086 $ 61,099 $61,149 $62,428 $65,279
- -----------------------------
(1) Amount represents less than $.01 per share.
(2) Exclusive of sales load.
(3) Annualized.
(4) Not annualized.
SEE NOTES TO FINANCIAL STATEMENTS.
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, VIRGINIA SERIES
- -----------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
Contained below is per share operating performance data for a share of
Beneficial Interest outstanding, total investment return, ratios to average net
assets and other supplemental data for each period indicated. This information
has been derived from the Fund's financial statements.
Class B Shares
_________________________________________________________________
Six Months Ended
October 31, 1998 Year Ended April 30,
_____________________________________________
PER SHARE DATA: (Unaudited) 1998 1997 1996 1995 1994
__________ ______ ______ ______ ______ ______
Net asset value, beginning of period . . . . . . $17.37 $16.60 $16.27 $16.03 $16.02 $16.80
______ ______ ______ ______ ______ ______
Investment Operations:
Investment income--net . . . . . . . . . . . . . .39 .79 .86 .84 .85 .88
Net realized and unrealized gain (loss)
on investments . . . . . . . . . . . . . . . .33 .77 .33 .24 .04 (.75)
______ ______ ______ ______ ______ ______
Total from Investment Operations . . . . . . . . .72 1.56 1.19 1.08 .89 .13
______ ______ ______ ______ ______ ______
Distributions:
Dividends from investment income--net . . . . . . (.39) (.79) (.86) (.84) (.85) (.88)
Dividends from net realized gain on investments . . -- (.00)(1) -- -- -- (.01)
Dividends in excess of net realized gain
on investments . . . . . . . . . . . . . . . -- -- -- -- (.03) (.02)
Total Distributions . . . . . . . . . . . . . . . (.39) (.79) (.86) (.84) (.88) (.91)
______ ______ ______ ______ ______ ______
Net asset value, end of period . . . . . . . . . $17.70 $17.37 $16.60 $16.27 $16.03 $16.02
______ ______ ______ ______ ______ ______
TOTAL INVESTMENT RETURN(2) . . . . . . . . . . . . . 8.25%(3) 9.56% 7.41% 6.77% 5.83% .54%
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets . . . . . 1.42%(3) 1.26% .90% 1.01% .90% 1.01%
Ratio of net investment income
to average net assets . . . . . . . . . . . . 4.37%(3) 4.58% 5.15% 5.06% 5.40% 5.02%
Decrease reflected in above expense ratios
due to undertakings by the Manager . . . . . -- .14% .55% .55% .55% .54%
Portfolio Turnover Rate . . . . . . . . . . . . . 17.54%(4) 21.25% 45.29% 50.06% 21.60% 30.69%
Net Assets, end of period (000's Omitted) . . . . $39,875 $ 40,100 $ 35,787 $33,120 $28,813 $25,254
- -----------------------------
(1) Amount represents less than $.01 per share.
(2) Exclusive of sales load.
(3) Annualized.
(4) Not annualized.
SEE NOTES TO FINANCIAL STATEMENTS.
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, VIRGINIA SERIES
- -----------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
Contained below is per share operating performance data for a share of
Beneficial Interest outstanding, total investment return, ratios to average net
assets and other supplemental data for each period indicated. This information
has been derived from the Fund's financial statements.
Class C Shares
_______________________________________________
Six Months Ended
October 31, 1998 Year Ended April 30,
___________________________
PER SHARE DATA: (Unaudited) 1998 1997 1996(1)
________________ _______ _______ _______
Net asset value, beginning of period . . . . . . . . . . . . . $17.36 $16.60 $16.26 $ 16.17
______ ______ ______ ______
Investment Operations:
Investment income--net . . . . . . . . . . . . . . . . . . . . .37 .75 .81 .57
Net realized and unrealized gain (loss)
on investments . . . . . . . . . . . . . . . . . . . . . . .34 .76 .34 .09
______ ______ ______ ______
Total from Investment Operations . . . . . . . . . . . . . . . .71 1.51 1.15 .66
______ ______ ______ ______
Distributions:
Dividends from investment income--net . . . . . . . . . . . . . (.37) (.75) (.81) (.57)
______ ______ ______ ______
Net asset value, end of period . . . . . . . . . . . . . . . . $17.70 $17.36 $16.60 $16.26
______ ______ ______ ______
TOTAL INVESTMENT RETURN(2) . . . . . . . . . . . . . . . . . . . . 8.11%(3) 9.22% 7.18% 5.64%(3)
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets . . . . . . . . . . . . 1.65%(3) 1.54% 1.17% 1.21%(3)
Ratio of net investment income
to average net assets . . . . . . . . . . . . . . . . . . . 4.10%(3) 4.24% 4.83% 4.55%(3)
Decrease reflected in above expense ratios
due to undertakings by the Manager . . . . . . . . . . . . -- .11% .54% .52%(3)
Portfolio Turnover Rate . . . . . . . . . . . . . . . . . . . . 17.54%(4) 21.25% 45.29% 50.06%
Net Assets, end of period (000's Omitted) . . . . . . . . . . . $2,739 $1,996 $674 $166
- -----------------------------
(1) From August 15, 1995 (commencement of initial offering) to April 30, 1996.
(2) Exclusive of sales load.
(3) Annualized.
(4) Not annualized.
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, VIRGINIA SERIES
- -----------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
NOTE 1--SIGNIFICANT ACCOUNTING POLICIES:
Dreyfus Premier State Municipal Bond Fund (the "Trust") is registered under
the Investment Company Act of 1940, as amended (the "Act") as a non-diversified
open-end management investment company, and operates as a series company
currently offering thirteen series including the Virginia Series (the "Fund").
The Fund' s investment objective is to maximize current income exempt from
Federal and, where applicable, from State income taxes, without undue risk. The
Dreyfus Corporation (the "Manager") serves as the Fund's investment adviser. The
Manager is a direct subsidiary of Mellon Bank, N.A.
Premier Mutual Fund Services, Inc. (the "Distributor") is the distributor of
the Fund's shares. The Fund is authorized to issue an unlimited number of $.001
par value shares in the following classes of shares: Class A, Class B and Class
C shares. Class A shares are subject to a sales charge imposed at the time of
purchase, Class B shares are subject to a contingent deferred sales charge
(" CDSC") imposed on Class B share redemptions made within six years of purchase
(five years for shareholders beneficially owning Class B shares on November 30,
1996) and Class C shares are subject to a CDSC imposed on Class C shares
redeemed within one year of purchase. Other differences between the classes
include the services offered to and the expenses borne by each class and certain
voting rights.
The Trust accounts separately for the assets, liabilities and operations of
each fund. Expenses directly attributable to each fund are charged to that
fund' s operations; expenses which are applicable to all funds are allocated
among them on a pro rata basis.
The Fund' s financial statements are prepared in accordance with generally
accepted accounting principles which may require the use of management estimates
and assumption. Actual results could differ from those estimates.
(A) PORTFOLIO VALUATION: Investments in securities (excluding options and
financial futures on municipal and U.S. treasury securities) are valued each
business day by an independent pricing service ("Service") approved by the Board
of Trustees. Investments for which quoted bid prices are readily available and
are representative of the bid side of the market in the judgment of the Service
are valued at the mean between the quoted bid prices (as obtained by the Service
from dealers in such securities) and asked prices (as calculated by the Service
based upon its evaluation of the market for such securities). Other investments
(which constitute a majority of the portfolio securities) are carried at fair
value as determined by the Service, based on methods which include consideration
of: yields or prices of municipal securities of comparable quality, coupon,
maturity and type; indications as to values from dealers; and general market
conditions. Options and financial futures on municipal and U.S. treasury
securities are valued at the last sales price on the securities exchange on
which such securities are primarily traded or at the last sales price on the
national securities market on each business day. Investments not listed on an
exchange or the national securities market, or securities for which there were
no transactions, are valued at the average of the most recent bid and asked
prices. Bid price is used when no asked price is available.
(B) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities transactions
are recorded on a trade date basis. Realized gain and loss from securities
transactions are recorded on the identified cost basis. Interest income,
adjusted for amortization of premiums and original issue discounts on
investments, is earned from settlement date and recognized on the accrual basis.
Securities purchased or sold on a when-issued or delayed-delivery basis may be
settled a month or more after the trade date. Under the terms of the custody
agreement, the Fund receives net earnings credits based on available cash
balances left on deposit.
The Fund follows an investment policy of investing primarily in municipal
obligations of one state. Economic changes affecting the state and certain of
its public bodies and municipalities may affect the ability of issuers within
the state to pay interest on, or repay principal of, municipal obligations held
by the Fund.
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, VIRGINIA SERIES
- -----------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
(C) DIVIDENDS TO SHAREHOLDERS: It is the policy of the Fund to declare
dividends daily from investment income-net. Such dividends are paid monthly.
Dividends from net realized capital gain are normally declared and paid
annually, but the Fund may make distributions on a more frequent basis to comply
with the distribution requirements of the Internal Revenue Code of 1986, as
amended (the "Code"). To the extent that net realized capital gain can be offset
by capital loss carryovers, if any, it is the policy of the Fund not to
distribute such gain.
(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.
NOTE 2--BANK LINE OF CREDIT:
The Fund participates with other Dreyfus-managed funds in a $600 million
redemption credit facility (" Facility" ) to be utilized for temporary or
emergency purposes, including the financing of redemptions. In connection
therewith, the Fund has agreed to pay commitment fees on its pro rata portion of
the Facility. Interest is charged to the Fund at rates based on prevailing
market rates in effect at the time of borrowings. During period ended October
31, 1998, the Fund did not borrow under the Facility.
NOTE 3--MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES:
(A) Pursuant to a management agreement with the Manager, the management fee
is computed at the annual rate of .55 of 1% of the value of the Fund's average
daily net assets and is payable monthly. The Manager had undertaken from May 1,
1998 to October 31, 1998 to reduce the management fee paid by the Fund, to the
extent that the Fund' s aggregate expenses (excluding certain expenses as
described above) exceeded an annual rate of 1% of the value of the Fund's
average daily net assets.
(B) Under the Distribution 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, 1998, Class B and Class C
shares were charged $100,875 and $9,011, respectively, pursuant to the
Distribution 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 Class A, Class B and Class C shares for the provision of
certain services. The services provided may include personal services relating
to shareholder accounts, such as answering shareholder inquiries regarding the
Fund and providing reports and other information, and services related to the
maintenance of shareholder accounts. The Distributor may make payments to
Service Agents (a securities dealer, financial institution or other industry
professional) in respect of these services. The Distributor determines the
amounts to be paid to Service Agents. During the period ended October 31, 1998,
Class A, Class B and Class C shares were charged $82,728, $50,437 and $3,004
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, 1998, the Fund was charged $22,527 pursuant to the transfer
agency agreement.
(D) Each trustee who is not an "affiliated person" as defined in the Act
receives from the Trust an annual fee of $2,500 and an attendance fee of $250
per meeting. The Chairman of the Board receives an additional 25% of such
compensation.
NOTE 4--SECURITIES TRANSACTIONS:
The aggregate amount of purchases and sales of investment securities,
excluding short-term securities, during the period ended October 31, 1998
amounted to $18,850,005 and $23,775,638, respectively.
DREYFUS PREMIER STATE MUNICIPAL BOND FUND, VIRGINIA SERIES
- -----------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
At October 31, 1998, accumulated net unrealized appreciation on investments
was $6,354,539, consisting of $6,423,492 gross unrealized appreciation and
$68,953 gross unrealized depreciation.
At October 31, 1998, 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).
DREYFUS PREMIER STATE MUNICIPAL
BOND FUND, VIRGINIA SERIES
200 Park Avenue
New York, NY 10166
MANAGER
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
CUSTODIAN
The Bank of New York
90 Washington Street
New York, NY 10286
TRANSFER AGENT &
DIVIDEND DISBURSING AGENT
Dreyfus Transfer, Inc.
P.O. Box 9671
Providence, RI 02940
Printed in U.S.A. 066/625SA9810
SEMI-ANNUAL REPORT
- -------------------------------------------------------------------------------
DREYFUS PREMIER STATE
MUNICIPAL BOND FUND
VIRGINIA SERIES
- -------------------------------------------------------------------------------
OCTOBER 31, 1998
[reg.tm logo]
(reg.tm)
