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[Logo]
ANNUAL REPORT
OCTOBER 31, 1995
[ ] WARBURG PINCUS FIXED INCOME FUND
[ ] WARBURG PINCUS GLOBAL FIXED INCOME FUND
[ ] WARBURG PINCUS INTERMEDIATE MATURITY GOVERNMENT FUND
[ ] WARBURG PINCUS NEW YORK INTERMEDIATE MUNICIPAL FUND
A prospectus containing more complete information, including management fees and
expenses and, where applicable, the special considerations and risks associated
with international investing, may be obtained by calling 1-800-257-5614 or by
writing to Warburg Pincus Funds, P.O. Box 9030, Boston, MA 02205-9030. Investors
should read the prospectus carefully before investing.
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WARBURG PINCUS FIXED INCOME FUND
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December 8, 1995
Dear Shareholder:
The objective of Warburg Pincus Fixed Income Fund (the 'Fund') is high
current income consistent with reasonable risk. Capital appreciation is a
secondary objective. The Fund invests in a broadly diversified portfolio of
securities, including both corporate and U.S. government issues.
For the 12 months ended October 31, 1995, the Fund gained 12.59%, vs. a
12.54% gain in the Lehman Brothers Intermediate Government/Corporate Bond Index.
The Fund's 30-day annualized SEC yield was 6.50% as of October 31, 1995. Its
total net assets were $116,982,908.
Falling interest rates and controlled inflation provided an ideal backdrop
for bond prices during the period, and the Fund participated fully in the
market's advance. Throughout, we maintained our emphasis on high-quality bonds
(approximately 83% of the portfolio was held in issues rated A or above by
Moody's or S&P as of October 31, 1995 with the majority in AAA-rated issues). We
also maintained our focus on intermediate-term issues in an effort to mitigate
risk while pursuing a high level of current income and, secondarily, capital
appreciation. At the end of the reporting period, the Fund's average maturity
and duration were 6.31 and 4.88 years, respectively.
Currently, the Fund's heaviest sector weighting is in U.S. Treasury
obligations, which we believe represent the most attractive values. We also hold
a position in mortgage-backed issues. Our preference in this sector is
commercial mortgage-backed bonds, which hold little of the prepayment risk
associated with standard GNMA or FNMA issues. We remain underweighted in
corporate bonds, which we think are generally fully valued relative to
Treasuries.
Looking ahead, we believe the environment remains a positive one for
fixed-income securities. Inflation remains subdued, which arguably gives the
Federal Reserve room to lower interest rates in the months ahead. Also arguing
for lower rates is the possibility of congressional passage of a credible
deficit-reduction plan. We believe the Fund is well-positioned to capitalize on
these positive developments in the market.
<TABLE>
<S> <C>
Dale C. Christensen M. Anthony E. van Daalen
Co-Portfolio Manager Co-Portfolio Manager
</TABLE>
2
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WARBURG PINCUS FIXED INCOME FUND
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GROWTH OF $10,000 INVESTED IN WARBURG PINCUS FIXED INCOME FUND
SINCE INCEPTION AS OF OCTOBER 31, 1995
The graph below illustrates the hypothetical investment of $10,000 in
Warburg Pincus Fixed Income Fund (the 'Fund') from August 17, 1987 (inception)
to October 31, 1995, assuming the reinvestment of dividends and capital gains at
net asset value, compared to the Lehman Brothers Intermediate
Government/Corporate Index ('LIGC')* for the same time period.
<TABLE>
<CAPTION>
[PERFORMANCE GRAPH]
Average Annual
Total Returns
for periods ending
FUND LIGC 10/31/95
<S> <C> <C> <C>
8/17/87 10,000.0 10,000.0 1 year
10/31/87 9,804.0 10,152.0 12.59%
10/31/88 11,046.0 11,098.0 5 year
10/31/89 11,906.0 12,269.0 9.84%
10/31/90 12,011.0 13,174.0 Since Inception
10/31/91 13,942.0 14,995.0 (08/17/87)
10/31/92 15,375.0 16,493.0 8.27%
10/31/93 17,164.0 18,129.0
10/31/94 17,060.0 17,778.0
10/31/95 19,208.0 20,005.0
</TABLE>
<TABLE>
<CAPTION>
FUND
------
<S> <C>
1 Year Total Return (9/30/94-9/30/95).................................................................. 11.70%
5 Year Average Annual Total Return (9/30/90-9/30/95)................................................... 9.21%
Average Annual Total Return Since Inception (8/17/87-9/30/95).......................................... 8.21%
</TABLE>
All figures cited here represent past performance and do not guarantee
future results. Investment return and principal value of an investment will
fluctuate so that an investor's shares upon redemption may be worth more or less
than original cost. For periods ending 9/30/95 and 10/31/95, respectively,
without waivers or reimbursement of Fund expenses, average annual total returns
would have been 11.51% and 12.39% for 1-year, 9.01% and 9.64% for 5-year, and
8.03% and 8.09% since inception.
- ------------
* The LIGC Index is an unmanaged index of intermediate government and corporate
bonds calculated by Lehman Brothers Inc. and has no defined investment
objective.
3
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WARBURG PINCUS GLOBAL FIXED INCOME FUND
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December 8, 1995
Dear Shareholder:
The objective of Warburg Pincus Global Fixed Income Fund (the 'Fund') is
maximum total return -- consistent with prudent management -- through a
combination of interest income, currency gains and capital appreciation. The
Fund's holdings mainly include a wide range of investment-grade,
income-producing securities of governmental and corporate issuers.
For the 12 months ended October 31, 1995, the Fund gained 10.65%, vs. gains
of 15.85% in the Salomon Brothers World Government Bond Index (Currency-Hedged)
and 8.77% in the Lipper World Income Fund Average. The Fund's 30-day annualized
SEC yield was 8.76% as of October 31, 1995. Its total net assets were
$63,641,044.
The combination of low inflation, falling interest rates and an overall
slowdown in the world's economic growth provided a strong backdrop for most
global bond markets during the period. By region, our largest exposure during
the year was to bonds of European issuers, which generated strong returns for
the portfolio. We remain bullish on the prospects of Europe's bond markets
(European issues represented 67.50% of the Fund's assets as of October 31,
1995), particularly those of Germany and Denmark.
Other areas of emphasis in the portfolio currently are Southeast Asian
convertible bonds, which we think represent particularly good values, and Latin
American debt issues. While the latter fell sharply following the December 20,
1994, devaluation of the Mexican peso, exacting a toll on the Fund's returns,
their performance has since recovered, and we expect significantly improved
performance from them going forward. Our largest exposure in Latin America is in
Argentina and Brazil (6.1% of the Fund at the end of October), followed by
Mexico (4.0%). It should be noted that all of these issues are U.S. dollar
denominated and thus there is no direct currency risk.
We have extended the Fund's duration in recent months (it stood at 4.9
years on October 31, vs. 4.0 years at the end of April), reflecting a more
positive outlook on the general direction of interest rates. Our longest
duration exposure is in Australia and Europe.
We have maintained the Fund's defensive stance in terms of currency
exposure, and through October approximately 95% of the portfolio was either U.S.
dollar-denominated or hedged into dollars. While this strategy proved less than
timely earlier in the fiscal year, given the U.S. currency's general weakness
against most foreign currencies, it proved its merits over the past several
months when the dollar rebounded.
<TABLE>
<S> <C>
Dale C. Christensen Laxmi C. Bhandari
Co-Portfolio Manager Co-Portfolio Manager
</TABLE>
4
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WARBURG PINCUS GLOBAL FIXED INCOME FUND
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GROWTH OF $10,000 INVESTED IN WARBURG PINCUS GLOBAL FIXED INCOME FUND
SINCE INCEPTION AS OF OCTOBER 31, 1995
The graph below illustrates the hypothetical investment of $10,000 in
Warburg Pincus Global Fixed Income Fund (the 'Fund') from November 1, 1990
(inception) to October 31, 1995, assuming the reinvestment of dividends and
capital gains at net asset value, compared to the Salomon Brothers World
Government Bond Index (Currency-Hedged) ('Salomon')* and the Lipper World Income
Fund Average ('Lipper')** for the same time period.
<TABLE>
<CAPTION>
[PERFORMANCE GRAPH]
Average Annual
Total Returns
for periods ending
FUND SALOMAN*** LIPPER 10/31/95
<S> <C> <C> <C> <C>
11/1/90 10,000.0 10,000.0 10,000.0 1 year
10/31/91 10,766.0 11,308.0 10,933.0 10.65%
10/31/92 11,958.0 12,449.0 11,600.0 Since Inception
10/31/93 13,957.0 13,968.0 12,959.0 (11/01/90)
10/31/94 13,567.0 13,494.0 12,691.0 8.46%
10/31/95 15,012.0 15,633.0 13,804.0
</TABLE>
<TABLE>
<CAPTION>
FUND
------
<S> <C>
1 Year Total Return (9/30/94-9/30/95)................................................. 10.50%
Average Annual Total Return Since Inception (11/01/90-9/30/95)........................ 8.39%
</TABLE>
All figures cited here represent past performance and do not guarantee
future results. Investment return and principal value of an investment will
fluctuate so that an investor's shares upon redemption may be worth more or less
than original cost. For periods ending 9/30/95 and 10/31/95, respectively,
without waivers or reimbursement of Fund expenses, average annual total returns
would have been 9.73% and 9.86% for 1-year, and 6.80% and 6.88% since inception.
- ------------
* The Salomon Brothers World Government Bond Index (Currency-Hedged) is a
market capitalization-weighted index designed to track major government debt
markets and is currency-hedged into U.S. dollars.
** The Lipper World Income Fund Average represents approximately 220 funds that
invest in non-U.S. dollar and U.S. dollar debt instruments with unspecified
maturities and durations, or other income producing securities.
*** The Fund changed its comparative index in the above chart from the J.P.
Morgan Global Government Bond Index ('JPMG-GLB') used in the preceding year
to the Salomon Brothers World Government Bond Index ('Salomon'). The primary
reason for the change is that the Fund's investment strategy is biased
towards hedging and the Salomon Index is hedged. In contrast, the JPMG-GLB
Index is unhedged. The one year performance for the period ending 10/31/95
for Salomon and JPMG-GLB was 15.85% vs. 15.35%, respectively.
5
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WARBURG PINCUS INTERMEDIATE MATURITY GOVERNMENT FUND
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December 8, 1995
Dear Shareholder:
The objective of Warburg Pincus Intermediate Maturity Government Fund (the
'Fund') is achieving a high level of current income as is consistent with
capital preservation. The Fund invests primarily in high-quality U.S. government
bonds with very low credit risk and an average maturity of between three and 10
years.
For the 12 months ended October 31, 1995, the Fund gained 12.32%, vs. an
11.79% gain in the Lehman Brothers Intermediate Government Bond Index. The
Fund's 30-day annualized SEC yield as of October 31, 1995 was 5.67%. Its total
net assets were $55,897,903.
Tame reports on inflation caused interest rates to fall throughout most of
the reporting period, driving bond prices higher. We extended the Fund's average
maturity and duration in order to take advantage of the decline in rates while
maintaining our primary emphasis on current income and limited volatility. As of
October 31, 1995 the Fund's average maturity and duration were 6.47 and 4.62
years, respectively.
Currently, the Fund's predominant focus is on U.S. Treasury securities,
which we believe are the most attractively valued issues in the present
environment. Treasuries accounted for 73.0% of the Portfolio as of October 31,
1995. We hold smaller positions in agency issues (19.5%) and mortgage-backed
securities issued by the Federal National Mortgage Association (5.0%).
Looking ahead, we believe that the combination of low inflation, stable or
falling interest rates, and the possibility of congressional passage of a
credible deficit-reduction plan augurs well for the fixed-income market. We
believe the Fund is positioned to take full advantage of this environment.
<TABLE>
<S> <C>
Dale C. Christensen M. Anthony E. van Daalen
Co-Portfolio Manager Co-Portfolio Manager
</TABLE>
6
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WARBURG PINCUS INTERMEDIATE MATURITY GOVERNMENT FUND
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GROWTH OF $10,000 INVESTED IN WARBURG PINCUS INTERMEDIATE MATURITY GOVERNMENT
FUND
SINCE INCEPTION AS OF OCTOBER 31, 1995
The graph below illustrates the hypothetical investment of $10,000 in
Warburg Pincus Intermediate Maturity Government Fund (the 'Fund') from August
22, 1988 (inception) to October 31, 1995, assuming the reinvestment of dividends
and capital gains at net asset value, compared to the Lehman Intermediate
Government Bond Index ('LIG')* for the same time period.
<TABLE>
<CAPTION>
[PERFORMANCE GRAPH]
Average Annual
Total Returns
for periods ending
FUND LIG 10/31/95
<S> <C> <C> <C>
8/22/88 10,000.0 10,000.0 1 year
10/31/88 10,427.0 10,313.0 12.32%
10/31/89 11,370.0 11,387.0 5 year
10/31/90 12,177.0 12,278.0 8.53%
10/31/91 13,847.0 13,911.0 Since Inception
10/31/92 15,279.0 15,280.0 (08/22/88)
10/31/93 16,623.0 16,687.0 8.79%
10/31/94 16,327.0 16,400.0
10/31/95 18,338.0 18,334.0
</TABLE>
<TABLE>
<CAPTION>
FUND
------
<S> <C>
1 Year Total Return (9/30/94-9/30/95).................................................................. 10.66%
5 Year Average Annual Total Return (9/30/90-9/30/95)................................................... 8.54%
Average Annual Total Return Since Inception (8/22/88-9/30/95).......................................... 8.69%
</TABLE>
All figures cited here represent past performance and do not guarantee
future results. Investment return and principal value of an investment will
fluctuate so that an investor's shares upon redemption may be worth more or less
than original cost. For periods ending 9/30/95 and 10/31/95, respectively,
without waivers or reimbursement of Fund expenses, average annual total returns
would have been 10.11% and 11.76% for 1-year, 8.18% and 8.17% for 5-year, and
7.96% and 8.06% since inception.
- ------------
* LIG Index is an unmanaged index of intermediate and long-term government bonds
that is compiled by Lehman Brothers Inc. and has no defined investment
objective.
7
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WARBURG PINCUS NEW YORK INTERMEDIATE MUNICIPAL FUND
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December 8, 1995
Dear Shareholder:
The objective of Warburg Pincus New York Intermediate Municipal Fund (the
'Fund') is maximum current income-exempt from federal, New York state and New
York City taxes-consistent with capital preservation and prudent management. The
Fund's assets consist primarily of investment-grade municipal securities with an
average maturity of between three and 10 years.
For the 12 months ended October 31, 1995, the Fund gained 8.31%, vs. a
10.91% gain in the Lipper Intermediate Municipal Debt Funds Average. The Fund's
30-day annualized SEC yield as of October 31, 1995 was 3.79%. Its total net
assets were $73,361,477.
Municipal bonds rose during most of the reporting period along with the
broader fixed-income market, driven by falling interest rates, slower economic
growth and tame data on inflation. By mid-summer 1995, declining municipal
yields were temporarily interrupted by tax-reform initiatives, especially
concerns regarding passage of the so-called flat tax. These concerns pushed down
prices on both high- and low-quality municipal bonds, and the resulting
attractive valuations on high-grade municipal issues made it possible for us to
boost the Fund's credit quality with little sacrifice in yield. Currently,
approximately 90% of the portfolio is held in issues rated A or higher by
Moody's or S&P, with the vast majority in AAA-rated securities.
Tax-related fears during the period prompted municipal investors to focus
most heavily on short-and intermediate-term securities (those with maturities of
10 years or less), since these stand to suffer proportionately less than
longer-term bonds if unfavorable tax reform is enacted. This, coupled with a
significant decrease in new issuance relative to 1994-municipal new issuance in
New York state was down by approximately 25% from year-earlier levels-boosted
sharply the prices of shorter-term issues. We responded by taking a proactive
stance with regard to buying and selling securities, selling bonds prior to
maturity in order to be in position to take advantage of attractive deals as
they came to market.
We expect the supply of new issues to pick up somewhat in the months ahead,
as New York municipalities attempt to take advantage of the current
low-interest-rate environment to call and refinance outstanding issues. This
could result in temporary short-term upward pressure on yields. We will use the
opportunity to selectively add high-quality New York bonds to the portfolio at
attractive yields.
<TABLE>
<S> <C>
Dale C. Christensen Sharon B. Parente
Co-Portfolio Manager Co-Portfolio Manager
</TABLE>
8
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WARBURG PINCUS NEW YORK INTERMEDIATE MUNICIPAL FUND
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GROWTH OF $10,000 INVESTED IN WARBURG PINCUS NEW YORK INTERMEDIATE MUNICIPAL
FUND
SINCE INCEPTION AS OF OCTOBER 31, 1995
The graph below illustrates the hypothetical investment of $10,000 in
Warburg Pincus New York Intermediate Municipal Fund (the 'Fund') from April 1,
1987 (inception) to October 31, 1995, with the reinvestment of dividends and
capital gains at net asset value, compared to the Lipper Intermediate Municipal
Debt Funds Average ('LIPIMUNI')* for the same time period.
<TABLE>
<CAPTION>
[PERFORMANCE GRAPH]
Average Annual
Total Returns
for periods ending
FUND LIPIMUNI 10/31/95
<S> <C> <C> <C>
4/1/87 10,000.0 10,000.0 1 year
10/31/87 9,687.0 9,627.0 8.31%
10/31/88 10,601.0 10,670.0 5 year
10/31/89 11,122.0 11,346.0 7.14%
10/31/90 11,810.0 12,088.0 Since Inception
10/31/91 12,923.0 13,314.0 (4/01/87)
10/31/92 13,780.0 14,288.0 6.13%
10/31/93 15,389.0 16,024.0
10/31/94 15,395.0 15,637.0
10/31/95 16,675.0 17,343.0
</TABLE>
<TABLE>
<CAPTION>
FUND
-----
<S> <C>
1 Year Total Return (9/30/94-9/30/95).................................................................... 6.93%
5 Year Average Annual Total Return (9/30/90-9/30/95)..................................................... 7.18%
Average Annual Total Return Since Inception (4/01/87-9/30/95)............................................ 6.10%
</TABLE>
All figures cited here represent past performance and do not guarantee
future results. Investment return and principal value of an investment will
fluctuate so that an investor's shares upon redemption may be worth more or less
than original cost. For periods ending 9/30/95 and 10/31/95, respectively,
without waivers or reimbursement of Fund expenses, average annual total returns
would have been 6.69% and 8.03% for 1-year, 6.82% and 6.78% for 5-year, and
5.42% and 5.46% since inception.
- ------------
* The Lipper Intermediate Municipal Debt Funds Average is an arithmetic average
of intermediate municipal debt funds' rates of returns on a monthly basis.
Lipper classifies intermediate municipal debt funds as those that invest in
municipal debt issues with dollar weighted average maturities of 5 to 10
years. The Lipper Average is unmanaged with no defined investment objective.
9
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WARBURG PINCUS FIXED INCOME FUND
STATEMENT OF NET ASSETS
October 31, 1995
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<TABLE>
<CAPTION>
RATINGS'D'
PAR SECURITY DESCRIPTION (MOODY'S/S&P) MATURITY RATE VALUE
- ----------- ------------------------------------------------------ ------------- --------- ------ ------------
<C> <S> <C> <C> <C> <C>
CORPORATE BONDS (16.0%)
$ 5,000,000 Banque Paribas Subordinate Notes (A2/A-) 06/15/07 8.350% $ 5,468,750
1,500,000 Benedek Broadcast Corporation Senior Secured Note
[Callable 03/01/00 @ $105.938] (B2/NR) 03/01/05 11.875 1,582,500
1,500,000 Continental Homes Holdings Corporation Senior Note
[Callable 08/01/97 @ $104] (Ba3/B) 08/01/99 12.000 1,588,125
500,000 Grancare, Inc. [Callable 9/15/00 @ $104.69] (B2/B) 09/15/05 9.375 498,750
3,500,000 J.C. Penney & Co. [Callable 06/15/01 @ $104.57] (A1/A+) 06/15/21 9.750 4,195,625
2,000,000 Mediq, Inc. Subordinated Debenture [Callable 07/15/96
@ $105] (B3/CCC+) 07/15/03 7.500 1,630,000
1,500,000 Peregrine Investment Holdings Convertible Bond (Euro)
[Callable 12/18/95 @ $100] (NR/NR) 12/01/00 4.500 1,224,375
1,000,000 Pueblo Xtra International, Inc. Senior Note [Callable
08/01/98 @ $104.75] (B2/B-) 08/01/03 9.500 952,500
2,000,000 Seventh Mexican Acceptance Bond (Grupo Sidek) (Euro) (NR/NR) 08/15/99 10.000 1,110,000
500,000 Telewest PLC [Callable 10/01/00 @ $104.81] (B1/BB) 10/01/06 9.625 502,500
------------
TOTAL CORPORATE BONDS (Cost $19,250,406) 18,753,125
------------
MORTGAGE-BACKED SECURITIES (25.7%)
667,012 Bankers Trust Company Multi-Class Pass Through CTSF
Series 1988-1 Class D (NR/AAA) 04/01/18 8.625 692,296
770,138 Donaldson, Lufkin, & Jenrette Acceptance Trust Series
1989-1 Class F (Aaa/AAA) 08/01/19 11.000 829,135
4,000,000 Federal Home Loan Bank Structured Note [Callable
01/27/96 @ $100] (Aaa/AAA) 07/27/00 5.000 3,951,200
414,520 Federal Home Loan Mortgage Corp. Pool #220014 (Aaa/AAA) 10/01/01 8.750 425,501
5,828,014 Federal National Mortgage Association Conventional
Loan Pool #250322 (Aaa/AAA) 08/01/25 7.500 5,891,702
281,147 Goldman Sachs Trust 2 Series F Class 3 (Aaa/AAA) 10/20/18 9.250 297,302
590,152 Guaranteed Mortgage Corp. Series M Class M1 (Aaa/NR) 04/01/03 8.500 607,102
3,771,954 Mortgage Capital Funding, Inc. Class 1995-MC1 (NR/AAA) 05/25/27 7.700 3,892,185
2,000,000 Nomura Asset Capital Corp. Series 1993-M1 Class A1 (NR/NR) 11/25/03 7.640 2,052,500
2,098,481 Nomura Asset Securities Corp. Series 1994-4B Class 4A (Aaa/AAA) 09/25/24 8.300 2,130,614
4,000,000 Resolution Trust Corp. Series 94-C1 Class B (Aa/AA+) 06/25/26 8.000 4,160,000
2,000,000 Resolution Trust Corporation Mortgage Pass Through
Series-95 C1 Class A-2C (Aaa/NR) 02/25/27 6.900 1,963,750
1,000,000 Security Pacific Home Equity ABS Series 1991 Class B (Aaa/AAA) 05/15/98 8.850 1,051,600
2,000,000 Shurgard CMO Asset Backed Pass Through Certificates
Series 1 Class 1 (NR/NR) 06/15/04 8.240 2,120,625
------------
TOTAL MORTGAGE-BACKED SECURITIES (Cost $29,313,859) 30,065,512
------------
</TABLE>
See Accompanying Notes to Financial Statements.
10
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WARBURG PINCUS FIXED INCOME FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1995
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<TABLE>
<CAPTION>
RATINGS'D'
PAR SECURITY DESCRIPTION (MOODY'S/S&P) MATURITY RATE VALUE
- ----------- ------------------------------------------------------ ------------- --------- ------ ------------
<C> <S> <C> <C> <C> <C>
MUNICIPAL BONDS (0.9%)
$ 1,000,000 Los Angeles County, California Pension Obligation,
Series D RB (Cost $1,000,000) (Aaa/AAA) 06/30/05 6.770% $ 1,002,500
------------
UNITED STATES TREASURY OBLIGATIONS (45.2%)
4,000,000 U.S. Treasury Note 07/15/98 8.250 4,251,840
13,500,000 U.S. Treasury Note 04/15/99 7.000 14,012,999
14,700,000 U.S. Treasury Note 05/15/01 8.000 16,174,408
16,750,000 U.S. Treasury Note 02/15/05 7.500 18,469,052
------------
TOTAL UNITED STATES TREASURY OBLIGATIONS (Cost $52,194,817) 52,908,299
------------
AGENCY OBLIGATIONS (1.5%)
1,677,798 Small Business Administration Guaranteed Development
Participation Certificate Debenture Series 1992-20D (Cost $1,677,798) 04/01/12 8.200 1,759,591
------------
</TABLE>
<TABLE>
<CAPTION>
COMMON STOCK (2.2%)
SHARES
- -----------
<C> <S> <C> <C>
50,000 American Health Properties, Inc. 1,031,250
50,000 Healthcare Realty Trust, Inc. 1,006,250
30,000 Universal Health Realty Income Trust 498,750
------------
TOTAL COMMON STOCK (Cost $2,579,398) 2,536,250
------------
PREFERRED STOCK (6.8%)
40,000 American Re Capital Corp. 8.500 1,005,000
40,000 Banesto Holdings Limited Series A 10.500 1,186,000
161,000 Indosuez Holdings SCA ADR 10.375 4,326,875
50,000 Credit Lyonnaise Capital SCA ADR # 9.500 1,212,500
2,320 Ohio Edison Corp. 7.360 234,320
------------
TOTAL PREFERRED STOCK (Cost $7,697,355) 7,964,695
------------
</TABLE>
<TABLE>
<CAPTION>
SHORT-TERM INVESTMENTS (1.1%)
PAR
- -----------
<C> <S> <C>
$ 1,254,000 Repurchase agreement with State Street Bank and Trust
Co. dated 10/31/95 at 5.83% to be repurchased at
$1,254,203 on 11/01/95. (Collateralized by $1,265,000
U.S. Treasury Note at 6.875% due 10/31/96, with a
market value of $1,280,813.) (Cost $1,254,000) 1,254,000
------------
TOTAL INVESTMENTS AT VALUE (99.4%) (Cost $114,967,633*) 116,243,972
OTHER ASSETS IN EXCESS OF LIABILITIES (0.6%) 738,936
------------
NET ASSETS (100.0%) (applicable to 11,618,046 shares) $116,982,908
------------
------------
NET ASSETS VALUE, offering and redemption price per share ($116,982,908[div]11,618,046) $10.07
------
------
</TABLE>
INVESTMENT ABBREVIATIONS
<TABLE>
<S> <C>
ADR = American Depository Receipt
CMO = Collateralized Mortgage Obligation
RB = Revenue Bond
</TABLE>
'D' Credit ratings given by Moody's Investors Service, Inc. and Standard &
Poor's Ratings Group are unaudited.
# Restricted security.
* Also cost for Federal income tax purposes.
See Accompanying Notes to Financial Statements.
11
- --------------------------------------------------------------------------------
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
WARBURG PINCUS GLOBAL FIXED INCOME FUND
STATEMENT OF NET ASSETS
October 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS'D'
PAR+ SECURITY DESCRIPTION (MOODY'S/S&P) MATURITY RATE VALUE
- ------------ --------------------------------------------------- ------------- --------- ------ -----------
<C> <S> <C> <C> <C> <C>
BONDS (89.8%)
Argentina (6.1%)
1,000,000 (A) Banco de Galicia & Buenos Aires SA (Callable
11/01/98 at $103.375) (B1/BB-) 11/01/03 9.000% $ 751,250
1,280,000 (A) Banco del Suquia (Ba/BB) 07/05/96 10.000 1,209,600
2,000,000 (A) Bridas Corp. (B1/BB-) 11/15/99 12.500 1,915,000
-----------
3,875,850
-----------
Australia (3.2%)
2,000,000 Australian Government (NR/AAA) 11/15/06 6.750 1,297,094
1,000,000 State Electric Commission -- Victoria (Aa2/NR) 09/18/03 9.250 769,115
-----------
2,066,209
-----------
Brazil (6.1%)
1,000,000 (A) Banco America do Sul (B1/BB) 10/17/97 10.750 1,000,000
900,000 (A) Banco Bandeirantes SA (B1/BB) 12/20/97 12.000 893,250
1,000,000 (A) Banco Braseg AG (B1/BB) 12/07/97 11.250 991,250
1,000,000 (A) Banco Itamarati SA (NR/BB) 11/23/97 11.625 991,250
-----------
3,875,750
-----------
Cayman Islands (3.2%)
2,500,000 (A) PIV Investment Financial (Convertible) (Callable
02/02/97 at $100.00) (A/NR) 12/01/00 4.500 2,031,250
-----------
Denmark (16.6%)
35,000,000 Kingdom of Denmark (Aa/AA) 03/15/06 8.000 6,448,127
780,000 (B) Kingdom of Denmark Mortgage-Backed (Zero Coupon) (Aa1/NR) 05/30/96 -- 984,366
2,582,000 Kreditforeningen (Callable 04/15/01 at 100.00 Dkr) (Baa/NR) 04/15/04 10.200 505,950
13,467,000 Nykredit (Aa/AA) 10/01/22 11.000 2,611,767
-----------
10,550,210
-----------
Germany (23.4%)
6,000,000 German Government (Aaa/AAA) 10/14/05 6.500 4,279,681
5,000,000 Land Hessen (Putable 11/29/03 at 100.00 Dmk) (Aaa/AAA) 11/29/13 6.000 3,412,484
9,500,000 Treuhandanstalt (Aaa/AAA) 09/09/04 7.500 7,196,929
-----------
14,889,094
-----------
Hong Kong (3.2%)
2,500,000 (A) Lai Fung Overseas Finance Ltd. (Convertible) (Ba/BB) 01/05/98 5.500 2,025,000
-----------
Indonesia (2.4%)
1,500,000 (A) Indah Kiat International Finance Co. (Callable
06/15/01 at $106.25) (Ba2/BB) 06/15/06 12.500 1,563,750
-----------
Ireland (7.9%)
3,500,000 Ireland Treasury (Aa/AA) 10/18/04 6.250 5,045,956
-----------
Mexico (4.0%)
2,420,000 (A) Grupo Simec SA de CV (Caa/CCC) 12/15/98 8.875 1,433,850
2,000,000 (A) Seventh Mexican Acceptance Corp. (Caa/CCC) 08/15/99 10.000 1,110,000
-----------
2,543,850
-----------
</TABLE>
See Accompanying Notes to Financial Statements.
12
- --------------------------------------------------------------------------------
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
WARBURG PINCUS GLOBAL FIXED INCOME FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS'D'
PAR+ SECURITY DESCRIPTION (MOODY'S/S&P) MATURITY RATE VALUE
- ------------ --------------------------------------------------- ------------- --------- ------ -----------
<C> <S> <C> <C> <C> <C>
BONDS (CONT'D)
Netherlands (4.6%)
4,500,000 Netherlands Government (Aaa/AAA) 06/15/05 7.000% $ 2,956,173
-----------
United Kingdom (8.9%)
2,000,000 Elf Enterprise Finance PLC (Convertible) (Callable
06/27/96 at 100.00 Gbp) (Aa3/AA-) 06/27/06 8.750 3,137,094
1,500,000 United Kingdom Treasury (Aaa/NR) 03/03/00 9.000 2,511,354
-----------
5,648,448
-----------
United States (0.2%)
100,000 U.S. Treasury Note (Aaa/AAA) 06/30/96 6.000 100,267
-----------
TOTAL BONDS (Cost $57,315,695) 57,171,807
-----------
</TABLE>
<TABLE>
<CAPTION>
PREFERRED STOCK (6.1%)
SHARES
<C> <S> <C> <C>
France (1.9%)
50,000 Credit Lyonnais Capital SCA ADR 9.500 1,212,500
-----------
Luxembourg (4.2%)
100,000 Indosuez Holdings SCA ADR 10.375 2,687,500
-----------
TOTAL PREFERRED STOCK (Cost $3,558,500) 3,900,000
-----------
</TABLE>
<TABLE>
<CAPTION>
SHORT-TERM INVESTMENTS (5.0%)
PAR
- ------------
<C> <S> <C>
$3,178,000 Repurchase agreement with State Street Bank & Trust
Company dated 10/31/95 at 5.83% to be repurchased
at $3,178,515 on 11/01/95. (Collateralized by
$3,210,000 U.S. Treasury Note 6.875%, due 10/31/96,
with a market value of $3,250,125.) (Cost
$3,178,000) 3,178,000
-----------
TOTAL INVESTMENTS AT VALUE (100.9%) (Cost $64,052,195*) 64,249,807
LIABILITIES IN EXCESS OF OTHER ASSETS (0.9%) (608,763)
-----------
NET ASSETS (100.0%) (applicable to 5,764,342 shares) $63,641,044
-----------
-----------
NET ASSET VALUE, offering and redemption price per share
($63,641,044[div]5,764,342) $11.04
------
------
</TABLE>
INVESTMENT ABBREVIATIONS
<TABLE>
<C> <S>
ADR = American Depository Receipts
DKR = Danish Krone
DMK = German Marks
GBP = British Pounds
</TABLE>
'D' Credit ratings given by Moody's Investors Service, Inc. and Standard &
Poor's Ratings Group are unaudited.
* Cost for Federal income tax purposes is $64,063,170.
+ Unless otherwise indicated below, all securities are denominated in the
currency of the issuers' country of origin.
(A) Denominated in Dollars (U.S.)
(B) Denominated in European Currency Units (ECU)
See Accompanying Notes to Financial Statements.
13
- --------------------------------------------------------------------------------
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
WARBURG PINCUS INTERMEDIATE MATURITY GOVERNMENT FUND
SCHEDULE OF INVESTMENTS
October 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PAR SECURITY DESCRIPTION MATURITY RATE VALUE
----------- ---------------------------------------------------------------------- --------- ----- -----------
<C> <S> <C> <C> <C>
AGENCY OBLIGATIONS (19.5%)
Small Business Administration (5.3%)
$ 1,350,147 Small Business Administration Guaranteed Development Participation
Certificate 07/01/02 6.600% $ 1,350,147
1,512,686 Small Business Administration Guaranteed Development Participation
Certificate Debenture Series 1992-10 B 04/01/02 7.450 1,529,704
-----------
Total Small Business Administration 2,879,851
-----------
Other (14.2%)
5,490,000 Government Trust Certificate Israel State Series 2 Class 2-E
Registered 05/15/02 9.400 6,169,387
1,500,000 Private Export Funding Group Secured Notes Series BB 10/30/98 9.100 1,621,875
-----------
Total Other 7,791,262
-----------
TOTAL AGENCY OBLIGATIONS (Cost $10,890,147) 10,671,113
-----------
MORTGAGE-BACKED SECURITIES (5.0%)
316,575 Federal National Mortgage Association 10/25/00 8.500 315,427
2,428,342 Federal National Mortgage Association 08/01/25 7.500 2,454,902
-----------
TOTAL MORTGAGE-BACKED SECURITIES (Cost $2,759,598) 2,770,329
-----------
UNITED STATES TREASURY OBLIGATIONS (73.0%)
U.S. Treasury Notes (66.4%)
2,000,000 U.S. Treasury Note 10/15/98 7.125 2,076,440
13,750,000 U.S. Treasury Note 05/15/01 8.000 15,129,124
17,500,000 U.S. Treasury Note 02/15/05 7.500 19,296,025
-----------
Total U.S. Treasury Notes 36,501,589
-----------
U.S. Treasury Strip Note (6.6%)
4,800,000 U.S. Treasury Strip Note 11/15/00 -- 3,600,240
-----------
TOTAL UNITED STATES TREASURY OBLIGATIONS (Cost $38,856,742) 40,101,829
-----------
SHORT-TERM INVESTMENTS (2.5%)
1,392,000 Repurchase agreement with State Street Bank and Trust Co. dated
10/31/95 at 5.83% to be repurchased at $1,392,225 on 11/01/95.
(Collateralized by $1,405,000 U.S. Treasury Note at 6.875%, due
10/31/96, with a market value of $1,422,563.) (Cost $1,392,000) 1,392,000
-----------
TOTAL INVESTMENTS AT VALUE (100.0%) (Cost $53,898,487*) $54,935,271
-----------
-----------
</TABLE>
* Also cost for Federal income tax purposes.
See Accompanying Notes to Financial Statements.
14
- --------------------------------------------------------------------------------
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
WARBURG PINCUS NEW YORK INTERMEDIATE MUNICIPAL FUND
STATEMENT OF NET ASSETS
October 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS'D'
PAR SECURITY DESCRIPTION (MOODY'S/S&P) MATURITY RATE VALUE
- ---------- ------------------------------------------------------ -------------- --------- -------- -----------
<S> <C> <C> <C> <C>
NEW YORK (78.3%)
$1,000,000 Albany New York Parking Authority Revenue Bond (LOC
Key Trust) [Pre-refunded 11/01/98 @ $100] (NR/AAA) 11/01/98 6.875% $1,076,250
750,000 Canandaigua New York City School District (FGIC
Insured) (Aaa/AAA) 06/01/99 7.125 821,250
1,000,000 Municipal Assistance Corporation Series #59 (MBIA
Insured) [Callable 07/01/97 @ $102] (Aaa/AAA) 07/01/01 7.750 1,078,750
225,000 Municipal Assistance Corporation Series #67 [Callable
07/01/99 @ $102] (Aa/AA-) 07/01/01 7.400 251,438
1,000,000 Municipal Assistance Corporation Series #67 [Callable
07/01/99 @ $102] (Aa/AA-) 07/01/04 7.600 1,127,500
640,000 Municipal Assistance Corporation Series #68 [Callable
07/01/99 @ $102] (Aa/AA-) 07/01/03 7.200 713,600
1,045,000 Nassau County General Obligation Series L (FGIC
Insured) [Escrowed to Maturity] (Aaa/AAA) 11/15/01 6.300 1,140,356
2,000,000 Nassau County General Obligation Series O (FGIC
Insured) (Aaa/AAA) 08/01/98 5.625 2,080,000
2,000,000 New York City Housing Development Corporation Variable
Rate Demand Bond Columbus Green Project Series 1985A (NR/AAA) 03/15/25 3.700 2,000,000
3,000,000 New York State Dormitory Authority Revenue Bond City
University Series A (Baa1/BBB) 07/01/05 5.700 3,056,250
1,515,000 New York State Dormitory Authority Revenue Bond City
University Series B (FGIC Insured) (Aaa/AAA) 07/01/99 6.900 1,657,031
1,000,000 New York State Dormitory Authority Revenue Bond
Cornell University [Callable 07/01/96 @ $102] (Aa/AA) 07/01/98 6.250 1,034,350
1,750,000 New York State Dormitory Authority Revenue Bond
Fordham University [Pre-refunded 07/01/00 @ $102] (Aaa/AAA) 07/01/00 7.200 1,986,250
2,000,000 New York State Dormitory Authority Revenue Bond State
University Educational Facilities Series A (Baa1/BBB+) 05/15/02 5.400 2,022,500
250,000 New York State Dormitory Authority Revenue Bond State
University Educational Facilities Series A (Baa1/BBB+) 05/15/04 6.500 268,750
3,000,000 New York State Dormitory Authority Revenue Bond State
University Educational Facilities Series B [Pre-
refunded 05/15/00 @ $102] (Aaa/BBB+) 05/15/00 7.250 3,405,000
1,000,000 New York State Dormitory Authority Revenue Bond
Upstate Community Colleges Series A [Pre-refunded
07/01/00 @ 102] (Baa1/NR) 07/01/00 7.600 1,150,000
750,000 New York State Dormitory Authority Revenue Bond
Upstate Community Colleges Series A (Baa1/BBB-) 07/01/01 5.200 750,000
680,000 New York State Dormitory Authority Revenue Bond
Upstate Community Colleges Series A (Baa1/BBB-) 07/01/02 5.300 680,000
1,000,000 New York State Dormitory Authority Revenue Bond State
University Educational Facilities [Callable 05/15/99 @
$102] (Baa1/BBB+) 05/15/02 7.000 1,083,750
2,000,000 New York State General Obligation Series C (A/A-) 10/01/03 6.000 2,150,000
1,200,000 New York State General Obligation Series C (A/A-) 10/01/04 6.000 1,294,500
2,500,000 New York State Housing Finance Agency Service Contract
Obligation Revenue Bond Series C
[Pre-refunded 09/15/01 @ $102] (Aaa/AAA) 09/15/01 7.300 2,903,125
</TABLE>
See Accompanying Notes to Financial Statements.
15
- --------------------------------------------------------------------------------
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
WARBURG PINCUS NEW YORK INTERMEDIATE MUNICIPAL FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS'D'
PAR SECURITY DESCRIPTION (MOODY'S/S&P) MATURITY RATE VALUE
- ---------- ------------------------------------------------------ -------------- --------- -------- -----------
<S> <C> <C> <C> <C>
NEW YORK (CONT'D)
$1,000,000 New York State Local Government Assistance Corp.
Series A (A/A) 04/01/99 6.000% $ 1,050,000
2,000,000 New York State Medicare Facilities Finance Agency
Revenue Bond [Pre-refunded 02/15/99 @ $102] (Aaa/AAA) 02/15/99 7.800 2,252,500
750,000 New York State Power Authority Revenue and General
Purpose Bond Series V [Callable 01/01/98 @ $102] (Aa/AA-) 01/01/03 7.600 814,688
1,800,000 New York State Thruway Authority General Series
[Callable 01/01/04 @ $102] (Aaa/AAA) 01/01/14 5.000 1,685,250
3,000,000 New York State Thruway Authority Service Contract
Revenue Bond Highway & Bridge Series A (Aaa/AAA) 01/01/04 6.000 3,262,500
2,500,000 New York State Urban Development Corporation
Correctional Facility Series 1 [Pre-refunded 01/01/00
@ $102] (Aaa/AAA) 01/01/00 7.500 2,837,500
1,000,000 New York State Urban Development Corporation
Correctional Facility Series 2 [Pre-refunded 01/01/01
@ $100] (Aaa/NR) 01/01/01 6.500 1,093,750
2,500,000 New York State Urban Development Corporation
Correctional Facility Series C [Pre-refunded 01/01/98
@ $102] (Aaa/AAA) 01/01/98 7.500 2,721,875
880,000 Suffolk County New York Water Authority Water Works
Revenue Bond [Pre-refunded 06/01/00 @ $102] (Aaa/AAA) 06/01/00 6.875 985,600
1,350,000 Syracuse New York General Obligation Public
Improvement Onondaga County [Escrowed to Maturity] (NR/NR) 02/15/98 6.600 1,422,563
1,000,000 Triborough Bridge & Tunnel Authority New York Revenue
Bond Series N [Pre-refunded 01/01/98
@ $101.50] (Aaa/AAA) 01/01/98 7.875 1,092,500
1,000,000 Triborough Bridge & Tunnel Authority New York Revenue
Bond Series O [Pre-refunded 01/01/99
@ $101.50] (Aaa/A+) 01/01/99 7.300 1,103,750
1,000,000 Triborough Bridge & Tunnel Authority New York Revenue
Bond Series O [Pre-refunded 01/01/99
@ $101.50] (Aaa/AAA) 01/01/99 7.700 1,116,250
2,000,000 Triborough Bridge & Tunnel Authority New York Revenue
Bond Series T (Pre-refunded 01/01/01 @ $102) (Aaa/A+) 01/01/01 7.000 2,265,000
-----------
TOTAL NEW YORK (Cost $55,688,530) 57,434,376
-----------
PUERTO RICO (16.4%)
335,000 Puerto Rico Commonwealth Aqueduct & Sewer Authority
[Escrowed To Maturity] [Callable 12/14/95
@ $100] (Aaa/AAA) 07/01/99 7.875 358,450
3,000,000 Puerto Rico Commonwealth General Obligation (MBIA
Insured) (Aaa/AAA) 07/01/01 5.500 3,176,250
185,000 Puerto Rico Commonwealth Public Improvement [Callable
07/01/97 @ $102] (NR/A) 07/01/02 7.125 196,562
40,000 Puerto Rico Commonwealth Public Improvement
[Pre-refunded 07/01/97 @ $102] (Baa1/AAA) 07/01/97 7.125 42,850
1,000,000 Puerto Rico Electric Power Authority Revenue Bond
Series L [Pre-refunded 07/01/97 @ $102] (Aaa/AAA) 07/01/97 7.600 1,078,750
</TABLE>
See Accompanying Notes to Financial Statements.
16
- --------------------------------------------------------------------------------
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
WARBURG PINCUS NEW YORK INTERMEDIATE MUNICIPAL FUND
STATEMENT OF NET ASSETS (CONT'D)
October 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATINGS'D'
PAR SECURITY DESCRIPTION (MOODY'S/S&P) MATURITY RATE VALUE
- ---------- ------------------------------------------------------ -------------- --------- -------- -----------
PUERTO RICO (CONT'D)
<C> <S> <C> <C> <C> <C>
$1,000,000 Puerto Rico Electric Power Authority Revenue Bond
Series M [Pre-refunded 07/01/98 @ $102] (NR/AAA) 07/01/98 8.000% $ 1,117,500
500,000 Puerto Rico Electric Power Authority Revenue Bond
Series N [Callable 07/01/99 @ $101.50] (Baa1/A-) 07/01/00 6.800 546,250
2,000,000 Puerto Rico Electric Power Authority Revenue Bond
Series O (MBIA Insured) (Aaa/AAA) 07/01/99 6.400 2,155,000
1,000,000 Puerto Rico Electric Power Authority Revenue Bond
Series Z [Callable 07/01/05 @ $102] (Baa1/A-) 07/01/12 5.500 981,250
500,000 Puerto Rico Public Building Authority Guaranteed
Public Education and Health Facilities Series H
[Pre-refunded 07/01/97 @ $102] (Aaa/AAA) 07/01/97 7.875 541,250
1,700,000 Puerto Rico Public Building Authority Revenue Bond
Series I (FGIC Insured) (Aaa/AAA) 07/01/99 6.850 1,859,374
-----------
TOTAL PUERTO RICO (Cost $11,839,347) 12,053,486
-----------
</TABLE>
<TABLE>
<CAPTION>
MONEY MARKET FUNDS (2.1%)
SHARES
- ----------
<C> <S> <C>
1,539,426 Nuveen Tax Exempt Money Fund (Cost $1,539,426) 1,539,426
-----------
TOTAL INVESTMENTS AT VALUE (96.8%)(Cost $69,067,303*) 71,027,288
OTHER ASSETS IN EXCESS OF LIABILITIES (3.2%) 2,334,189
-----------
NET ASSETS (100.0%) (applicable to 7,041,901 shares) $73,361,477
-----------
-----------
NET ASSET VALUE, offering and redemption price per share ($73,361,477[div]7,041,901) $10.42
------
------
</TABLE>
INVESTMENT ABBREVIATIONS
<TABLE>
<S> <C>
FGIC = Financial Guaranty Insurance Company
LOC = Letter of Credit
MBIA = Municipal Bond Insurance Association
</TABLE>
'D' Credit ratings given by Moody's Investors Service, Inc. and Standard &
Poor's Ratings Group are unaudited.
* Also cost for Federal income tax purposes.
See Accompanying Notes to Financial Statements.
17
- --------------------------------------------------------------------------------
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
WARBURG PINCUS INTERMEDIATE MATURITY GOVERNMENT FUND
STATEMENT OF ASSETS AND LIABILITIES
October 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS
Investments at value (Cost $53,898,487) $54,935,271
Receivable for investment securities sold 3,804,823
Dividends and interest receivable 1,091,532
Receivable for Fund shares sold 86,945
Other assets 2,580
-----------
Total assets 59,921,151
-----------
LIABILITIES
Payable for investment securities purchased 3,910,560
Accrued expenses 43,783
Payable for Fund shares redeemed 7,469
Other liabilities 61,436
-----------
Total liabilities 4,023,248
-----------
NET ASSETS applicable to 5,467,154 shares outstanding $55,897,903
-----------
-----------
NET ASSET VALUE, offering and redemption price per share
($55,897,903[div]5,467,154) $10.22
------
------
</TABLE>
See Accompanying Notes to Financial Statements.
18
- --------------------------------------------------------------------------------
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
WARBURG PINCUS FIXED INCOME FUNDS
STATEMENTS OF OPERATIONS
For the Year Ended October 31, 1995
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Warburg
Warburg Pincus Warburg Pincus
Warburg Pincus Intermediate New York
Pincus Global Maturity Intermediate
Fixed Income Fixed Income Government Municipal
Fund Fund Fund Fund
------------ ------------ ---------- --------------
<S> <C> <C> <C> <C>
INVESTMENT INCOME:
Interest $ 8,376,182 $6,507,144 $3,252,179 $3,982,642
Dividends 470,438 552,228 98,083 45,198
------------ ------------ ---------- --------------
Total investment income 8,846,620 7,059,372 3,350,262 4,027,840
------------ ------------ ---------- --------------
EXPENSES:
Investment advisory 555,483 773,318 253,734 316,050
Administrative services 222,194 170,130 102,661 158,024
Audit 15,674 16,985 16,975 15,975
Custodian/Sub-custodian 48,401 44,270 17,340 23,471
Directors/Trustees 10,500 10,500 10,500 10,500
Insurance 6,127 5,754 3,692 4,479
Legal 73,175 72,631 58,060 70,563
Printing 11,861 4,525 5,236 12,489
Registration 31,178 31,790 26,398 16,631
Transfer agent 48,503 51,309 43,347 33,447
Miscellaneous 14,281 38,611 14,726 14,365
------------ ------------ ---------- --------------
1,037,377 1,219,823 552,669 675,994
Less: fees waived (204,153) (485,160) (248,192) (201,919)
------------ ------------ ---------- --------------
Total expenses 833,224 734,663 304,477 474,075
------------ ------------ ---------- --------------
Net investment income 8,013,396 6,324,709 3,045,785 3,553,765
------------ ------------ ---------- --------------
NET REALIZED AND UNREALIZED GAIN FROM INVESTMENTS
AND FOREIGN CURRENCY RELATED ITEMS:
Net realized gain from security transactions 1,132,052 508,655 514,443 818,720
Net realized loss from futures contracts (606,653) (849,500) 0 0
Net realized gain (loss) from foreign currency
related items 49,446 (961,036) 0 0
Net decrease in unrealized depreciation from
investments and foreign currency related
items 4,869,743 2,015,972 2,406,718 1,979,229
------------ ------------ ---------- --------------
Net realized and unrealized gain from
investments and foreign currency
related items 5,444,588 714,091 2,921,161 2,797,949
------------ ------------ ---------- --------------
Net increase in net assets resulting
from operations $ 13,457,984 $7,038,800 $5,966,946 $6,351,714
------------ ------------ ---------- --------------
------------ ------------ ---------- --------------
</TABLE>
See Accompanying Notes to Financial Statements.
19
- --------------------------------------------------------------------------------
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
WARBURG PINCUS FIXED INCOME FUNDS
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Warburg Pincus Warburg Pincus
Fixed Income Global Fixed
Fund Income Fund
----------------------------- -----------------------------
For the Year Ended October For the Year Ended October
31, 31,
1995 1994 1995 1994
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
FROM OPERATIONS:
Net investment income $ 8,013,396 $ 5,867,260 $ 6,324,709 $ 5,807,634
Net realized gain (loss) from security
transactions 1,132,052 (1,660,108) 508,655 (1,869,553)
Net realized gain (loss) from futures
contracts (606,653) 117,484 (849,500) 269,845
Net realized gain (loss) from foreign
currency related items 49,446 18,246 (961,036) (2,237,413)
Net change in unrealized appreciation
(depreciation) from investments and
foreign currency related items 4,869,743 (4,804,661) 2,015,972 (4,227,712)
------------ ------------ ------------ ------------
Net increase (decrease) in net assets
resulting from operations 13,457,984 (461,779) 7,038,800 (2,257,199)
------------ ------------ ------------ ------------
FROM DISTRIBUTIONS:
Dividends from net investment income (8,013,396) (5,926,356) (3,445,878) (3,215,939)
Distributions from capital gains 0 (732,704) 0 (827,403)
Return of capital 0 0 0 (366,074)
------------ ------------ ------------ ------------
Net decrease from distributions (8,013,396) (6,659,060) (3,445,878) (4,409,416)
------------ ------------ ------------ ------------
FROM CAPITAL SHARE TRANSACTIONS:
Proceeds from sale of shares 47,678,747 58,018,967 42,488,917 61,614,112
Reinvested dividends 6,555,741 5,623,287 2,941,954 3,798,759
Net asset value of shares redeemed (44,942,286) (35,456,760) (75,776,818) (30,346,474)
------------ ------------ ------------ ------------
Net increase (decrease) in net assets
from capital share transactions 9,292,202 28,185,494 (30,345,947) 35,066,397
------------ ------------ ------------ ------------
Net increase (decrease) in net assets 14,736,790 21,064,655 (26,753,025) 28,399,782
NET ASSETS:
Beginning of year 102,246,118 81,181,463 90,394,069 61,994,287
------------ ------------ ------------ ------------
End of year $116,982,908 $102,246,118 $ 63,641,044 $ 90,394,069
------------ ------------ ------------ ------------
------------ ------------ ------------ ------------
20
- --------------------------------------------------------------------------------
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<CAPTION>
Warburg Pincus Warburg Pincus
Intermediate Maturity New York Intermediate
Government Fund Municipal Fund
--------------------------------- ---------------------------------
For the Year Ended October 31, For the Year Ended October 31,
1995 1994 1995 1994
------------ ------------ ------------ ------------
<C> <C> <C> <C>
$ 3,045,785 $ 2,827,703 $ 3,553,765 $ 3,215,210
514,443 (58,020) 818,720 47,719
0 0 0 0
0 0 0 0
2,406,718 (3,492,181) 1,979,229 (3,387,003)
------------ ------------ ------------ ------------
5,966,946 (722,498) 6,351,714 (124,074)
------------ ------------ ------------ ------------
(3,045,785) (2,827,703) (3,553,765) (3,222,899)
0 (3,937,754) (47,531) (912,745)
0 0 0 0
------------ ------------ ------------ ------------
(3,045,785) (6,765,457) (3,601,296) (4,135,644)
------------ ------------ ------------ ------------
26,773,501 24,310,135 32,441,402 50,293,197
2,288,064 5,552,546 3,073,742 3,404,096
(22,818,476) (53,205,957) (40,620,180) (43,299,063)
------------ ------------ ------------ ------------
6,243,089 (23,343,276) (5,105,036) 10,398,230
------------ ------------ ------------ ------------
9,164,250 (30,831,231) (2,354,618) 6,138,512
46,733,653 77,564,884 75,716,095 69,577,583
------------ ------------ ------------ ------------
$ 55,897,903 $ 46,733,653 $ 73,361,477 $ 75,716,095
------------ ------------ ------------ ------------
------------ ------------ ------------ ------------
</TABLE>
See Accompanying Notes to Financial Statements.
21
- --------------------------------------------------------------------------------
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
WARBURG PINCUS FIXED INCOME FUND
FINANCIAL HIGHLIGHTS
(For a Share of the Fund Outstanding Throughout Each Year)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
For the Year Ended October 31,
------------------------------------------------------
1995 1994 1993 1992 1991
-------- -------- -------- ------- -------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF YEAR $ 9.61 $ 10.42 $ 9.90 $ 9.61 $ 8.95
-------- -------- -------- ------- -------
Income from Investment Operations:
Net Investment Income .70 .63 .56 .67 .73
Net Gain (Loss) on Securities and Foreign Currency
Related Items (both realized and unrealized) .46 (.70) .52 .29 .66
-------- -------- -------- ------- -------
Total from Investment Operations 1.16 (.07) 1.08 .96 1.39
-------- -------- -------- ------- -------
Less Distributions:
Dividends from Net Investment Income (.70) (.65) (.56) (.67) (.73)
Distributions from Capital Gains .00 (.09) .00 .00 .00
-------- -------- -------- ------- -------
Total Distributions (.70) (.74) (.56) (.67) (.73)
-------- -------- -------- ------- -------
NET ASSET VALUE, END OF YEAR $ 10.07 $ 9.61 $ 10.42 $ 9.90 $ 9.61
-------- -------- -------- ------- -------
-------- -------- -------- ------- -------
Total Return 12.59% (.60%) 11.63% 10.28% 16.08%
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Year (000s) $116,983 $102,246 $81,181 $65,095 $61,908
Ratios to average daily net assets:
Operating expenses .75% .75% .75% .75% .75%
Net investment income 7.25% 6.53% 5.99% 6.82% 7.85%
Decrease reflected in above operating expense ratios
due to waivers/reimbursements .18% .18% .09% .27% .24%
Portfolio Turnover Rate 182.93% 179.44% 227.37% 122.04% 150.61%
</TABLE>
See Accompanying Notes to Financial Statements.
TAX STATUS OF 1995 DIVIDENDS (Unaudited)
Dividends paid by the Fund taxable as ordinary income amounted to $.70 per
share.
Because the Fund's fiscal year is not the calendar year, amounts to be used by
calendar year taxpayers on their Federal return will be reflected on Form
1099-DIV and will be mailed in January 1996.
22
- --------------------------------------------------------------------------------
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
WARBURG PINCUS GLOBAL FIXED INCOME FUND
FINANCIAL HIGHLIGHTS
(For a Share of the Fund Outstanding Throughout Each Year)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
For the Year Ended October 31,
---------------------------------------------------
1995 1994 1993 1992 1991+
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF YEAR $ 10.45 $ 11.38 $ 10.68 $ 10.40 $ 10.00
------- ------- ------- ------- -------
Income from Investment Operations:
Net Investment Income .99 .34 .54 .86 .59
Net Gain (Loss) on Securities and Foreign Currency
Related Items (both realized and unrealized) .09 (.64) 1.13 .28 .14
------- ------- ------- ------- -------
Total from Investment Operations 1.08 (.30) 1.67 1.14 .73
------- ------- ------- ------- -------
Less Distributions:
Dividends from Net Investment Income (.49) (.45) (.85) (.67) (.33)
Distributions from Capital Gains .00 (.14) (.12) (.19) .00
Return of Capital .00 (.04) .00 .00 .00
------- ------- ------- ------- -------
Total Distributions (.49) (.63) (.97) (.86) (.33)
------- ------- ------- ------- -------
NET ASSET VALUE, END OF YEAR $ 11.04 $ 10.45 $ 11.38 $ 10.68 $ 10.40
------- ------- ------- ------- -------
------- ------- ------- ------- -------
Total Return 10.65% (2.79%) 16.72% 11.08% 7.66%
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Year (000s) $63,641 $90,394 $61,994 $17,092 $12,160
Ratios to average daily net assets:
Operating expenses .95% .95% .49% .45% 1.09%
Net investment income 8.18% 6.96% 8.60% 8.66% 7.45%
Decrease reflected in above operating expense ratios due
to waivers/reimbursements .63% .65% 1.44% 2.42% 2.73%
Portfolio Turnover Rate 128.70% 178.11% 109.54% 93.14% 185.74%
</TABLE>
+ The Fund commenced operations on November 1, 1990.
See Accompanying Notes to Financial Statements.
TAX STATUS OF 1995 DIVIDENDS (Unaudited)
Dividends paid by the Fund taxable as ordinary income amounted to $.49 per
share.
Because the Fund's fiscal year is not the calendar year, amounts to be used by
calendar year taxpayers on their Federal return will be reflected on Form
1099-DIV and will be mailed in January 1996.
23
- --------------------------------------------------------------------------------
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
WARBURG PINCUS INTERMEDIATE MATURITY GOVERNMENT FUND
FINANCIAL HIGHLIGHTS
(For a Share of the Fund Outstanding Throughout Each Year)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
For the Year Ended October 31,
-------------------------------------------------
1995 1994 1993 1992 1991
------- ------- -------- -------- -------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF YEAR $ 9.66 $ 11.03 $ 11.23 $ 10.83 $ 10.24
------- ------- -------- -------- -------
Income from Investment Operations:
Net Investment Income .59 .54 .59 .68 .76
Net Gain (Loss) on Securities (both realized and
unrealized) .56 (.73) .34 .41 .59
------- ------- -------- -------- -------
Total from Investment Operations 1.15 (.19) .93 1.09 1.35
------- ------- -------- -------- -------
Less Distributions:
Dividends from Net Investment Income (.59) (.55) (.59) (.68) (.76)
Distributions from Capital Gains .00 (.63) (.54) (.01) .00
------- ------- -------- -------- -------
Total Distributions (.59) (1.18) (1.13) (.69) (.76)
------- ------- -------- -------- -------
NET ASSET VALUE, END OF YEAR $ 10.22 $ 9.66 $ 11.03 $ 11.23 $ 10.83
------- ------- -------- -------- -------
------- ------- -------- -------- -------
Total Return 12.32% (1.78%) 8.79% 10.34% 13.71%
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Year (000s) $55,898 $46,734 $77,565 $113,336 $89,006
Ratios to average daily net assets:
Operating expenses .60% .60% .60% .60% .57%
Net investment income 6.00% 5.43% 5.34% 6.10% 7.29%
Decrease reflected in above operating expense ratios due
to waivers/reimbursements .49% .42% .21% .25% .30%
Portfolio Turnover Rate 105.79% 115.37% 108.00% 165.70% 39.13%
</TABLE>
See Accompanying Notes to Financial Statements.
TAX STATUS OF 1995 DIVIDENDS (Unaudited)
Dividends paid by the Fund taxable as ordinary income amounted to $.59 per
share.
Because the Fund's fiscal year is not the calendar year, amounts to be used by
calendar year taxpayers on their Federal return will be reflected on Form
1099-DIV and will be mailed in January 1996.
24
- --------------------------------------------------------------------------------
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
WARBURG PINCUS NEW YORK INTERMEDIATE MUNICIPAL FUND
FINANCIAL HIGHLIGHTS
(For a Share of the Fund Outstanding Throughout Each Year)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
For the Year Ended October 31,
-----------------------------------------------
1995 1994 1993 1992 1991
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING OF YEAR $ 10.07 $ 10.65 $ 10.02 $ 9.88 $ 9.57
------- ------- ------- ------- -------
Income from Investment Operations:
Net Investment Income .47 .46 .47 .50 .53
Net Gain (Loss) on Securities (both realized and
unrealized) .36 (.45) .68 .14 .31
------- ------- ------- ------- -------
Total from Investment Operations .83 .01 1.15 .64 .84
------- ------- ------- ------- -------
Less Distributions:
Dividends from Net Investment Income (.47) (.46) (.47) (.50) (.53)
Distributions from Capital Gains (.01) (.13) (.05) .00 .00
------- ------- ------- ------- -------
Total Distributions (.48) (.59) (.52) (.50) (.53)
------- ------- ------- ------- -------
NET ASSET VALUE, END OF YEAR $ 10.42 $ 10.07 $ 10.65 $ 10.02 $ 9.88
------- ------- ------- ------- -------
------- ------- ------- ------- -------
Total Return 8.31% .04% 11.67% 6.63% 9.43%
RATIOS/SUPPLEMENTAL DATA:
Net Assets, End of Year (000s) $73,361 $75,716 $69,578 $54,012 $29,016
Ratios to average daily net assets:
Operating expenses .60% .60% .58% .55% .55%
Net investment income 4.50% 4.41% 4.50% 4.99% 5.84%
Decrease reflected in above operating expense ratios due to
waivers/reimbursements .26% .20% .20% .40% .65%
Portfolio Turnover Rate 105.17% 167.09% 115.98% 47.79% 66.53%
</TABLE>
See Accompanying Notes to Financial Statements.
TAX STATUS OF 1995 DIVIDENDS (Unaudited)
Long-term capital gain dividends paid by the Fund amounted to $.01 per share.
Because the Fund's fiscal year is not the calendar year, amounts to be used by
calendar year taxpayers on their Federal return will be reflected on Form
1099-DIV and will be mailed in January 1996.
25
- --------------------------------------------------------------------------------
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
WARBURG PINCUS FIXED INCOME FUNDS
NOTES TO FINANCIAL STATEMENTS
October 31, 1995
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES
The Warburg Pincus Fixed Income Funds are comprised of the Warburg Pincus
Fixed Income Fund (the 'Fixed Income Fund') and the Warburg Pincus Intermediate
Maturity Government Fund (the 'Intermediate Government Fund') which are
registered under the Investment Company Act of 1940, as amended (the '1940
Act'), as diversified, open-end management investment companies and the Warburg
Pincus Global Fixed Income Fund (the 'Global Fixed Income Fund') and the Warburg
Pincus New York Intermediate Municipal Fund (the 'New York Municipal Fund')
which are registered under the 1940 Act as non-diversified, open-end management
investment companies.
Investment objectives for each Fund are as follows: the Fixed Income Fund
seeks to generate high current income consistent with reasonable risk with
capital appreciation a secondary objective; the Global Fixed Income Fund seeks
to maximize total investment return consistent with prudent investment
management, consisting of a combination of interest income, currency gains and
capital appreciation; the Intermediate Government Fund seeks to achieve as high
a level of current income as is consistent with preservation of capital; and the
New York Municipal Fund seeks to maximize current interest income exempt from
Federal income tax and New York State and New York City personal income tax to
the extent consistent with prudent investment and preservation of capital.
The net asset value of each Fund is determined daily as of the close of
regular trading on the New York Stock Exchange. Each Fund's investments are
valued at market value, which is currently determined using the last reported
sales price. If no sales are reported, investments are generally valued at the
last reported bid price. In the absence of market quotations, investments are
generally valued at fair value as determined by or under the direction of the
Fund's governing Board. Short-term investments that mature in 60 days or less
are valued on the basis of amortized cost, which approximates market value.
The books and records of the Funds are maintained in U.S. dollars.
Transactions denominated in foreign currencies are recorded at the current
prevailing exchange rates. All assets and liabilities denominated in foreign
currencies are translated into U.S. dollar amounts at the current exchange rate
at the end of the period. Translation gains or losses resulting from changes in
the exchange rate during the reporting period and realized gains and losses on
the settlement of foreign currency transactions are reported in the results of
operations for the current period. The Global Fixed Income Fund isolates that
portion of gains and losses on investments in debt securities which are due to
changes in the foreign exchange rate from that which are due to changes in
market prices of debt securities.
Security transactions are accounted for on trade date. Interest income is
recorded on the accrual basis. Dividends are recorded on the ex-dividend date.
The cost of investments sold is determined by use of the specific identification
method for both financial reporting and income tax purposes.
Dividends from net investment income are declared daily and paid monthly
for the Fixed Income Fund, the Intermediate Government Fund and the New York
Municipal Fund. Dividends from net investment income are declared and paid
quarterly for the Global Fixed Income Fund. Distributions for all Funds of net
realized capital gains, if any, are declared and paid annually. However, to the
extent that a net realized capital gain can be reduced by a capital loss
carryover, such gain will not be distributed.
26
- --------------------------------------------------------------------------------
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
WARBURG PINCUS FIXED INCOME FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 1995
- --------------------------------------------------------------------------------
Income and capital gain distributions are determined in accordance with Federal
income tax regulations which may differ from generally accepted accounting
principles.
Certain amounts in the Statements of Changes in Net Assets have been
reclassified to conform to current year presentation.
No provision is made for Federal taxes as it is each Fund's intention to
continue to qualify for and elect the tax treatment applicable to regulated
investment companies under the Internal Revenue Code and make the requisite
distributions to its shareholders which will be sufficient to relieve it from
Federal income and excise taxes.
Costs incurred by the Global Fixed Income Fund in connection with its
organization have been deferred and are being amortized over a period of five
years from the date the Global Fixed Income Fund commenced its operations.
Each Fund may enter into repurchase agreement transactions. Under the terms
of a typical repurchase agreement, a Fund acquires an underlying security
subject to an obligation of the seller to repurchase. The value of the
underlying security collateral will be maintained at an amount at least equal to
the total amount of the purchase obligation, including interest. The collateral
is in the Fund's possession.
2. INVESTMENT ADVISER, CO-ADMINISTRATORS AND DISTRIBUTOR
Warburg, Pincus Counsellors, Inc. ('Warburg'), a wholly owned subsidiary of
Warburg, Pincus Counsellors G.P. ('Counsellors G.P.'), serves as each Fund's
investment adviser. For its investment advisory services, Warburg receives the
following fees based on each Fund's average daily net assets:
<TABLE>
<CAPTION>
FUND ANNUAL RATE
- --------------------------------- ----------------------------------
<S> <C>
Fixed Income .50% of average daily net assets
Global Fixed Income 1.00% of average daily net assets
Intermediate Government .50% of average daily net assets
New York Municipal .40% of average daily net assets
</TABLE>
For the year ended October 31, 1995, investment advisory fees and waivers
were as follows:
<TABLE>
<CAPTION>
GROSS NET
FUND ADVISORY FEE WAIVER ADVISORY FEE
- --------------------------------------------------- ------------ --------- ------------
<S> <C> <C> <C>
Fixed Income $555,483 $(162,585) $392,898
Global Fixed Income 773,318 (435,848) 337,470
Intermediate Government 253,734 (226,320) 27,414
New York Municipal 316,050 (168,856) 147,194
</TABLE>
Counsellors Funds Service, Inc. ('CFSI'), a wholly owned subsidiary of
Warburg, and PFPC Inc. ('PFPC'), an indirect, wholly owned subsidiary of PNC
Bank Corp. ('PNC'), serve as each Fund's co-administrators. For administrative
services, CFSI currently receives a fee calculated at an annual rate of
27
- --------------------------------------------------------------------------------
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
WARBURG PINCUS FIXED INCOME FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 1995
- --------------------------------------------------------------------------------
.10% of each Fund's average daily net assets. For the year ended October 31,
1995, administrative services fees earned by CFSI were as follows:
<TABLE>
<CAPTION>
FUND CO-ADMINISTRATION FEE
- ----------------------------------------------------------------------- ---------------------
<S> <C>
Fixed Income $ 111,097
Global Fixed Income 77,332
Intermediate Government 50,747
New York Municipal 79,012
</TABLE>
For its administrative services, PFPC currently receives a fee calculated
at an annual rate of .10% of the average daily net assets of the Fixed Income
Fund, the Intermediate Government Fund and the New York Municipal Fund. For the
Global Fixed Income Fund, PFPC currently receives a fee calculated at an annual
rate of .12% of the first $250 million in average daily net assets, .10% of the
next $250 million in average daily net assets, .08% of the next $250 million in
average daily net assets and .05% of average daily net assets over $750 million.
For the year ended October 31, 1995, administrative services fees earned
and voluntarily waived by PFPC were as follows:
<TABLE>
<CAPTION>
FUND GROSS FEE WAIVER NET
- ----------------------------------------------------------- --------- -------- -------
<S> <C> <C> <C>
Fixed Income $ 111,097 $(41,568) $69,529
Global Fixed 92,798 (49,312) 43,486
Intermediate Government 51,914 (21,872) 30,042
New York Municipal 79,012 (33,063) 45,949
</TABLE>
Counsellors Securities Inc. ('CSI'), also a wholly owned subsidiary of
Warburg, serves as each Fund's distributor. No compensation is paid by the Funds
to CSI for distribution services.
3. INVESTMENTS IN SECURITIES
For the year ended October 31, 1995, purchases and sales of investment
securities (excluding short-term investments) and United States government and
agency obligations were as follows:
<TABLE>
<CAPTION>
U.S. GOVERNMENT AND
INVESTMENT SECURITIES AGENCY OBLIGATIONS
--------------------------- ----------------------------
FUND PURCHASES SALES PURCHASES SALES
- --------------------------------------- ----------- ------------ ------------ ------------
<S> <C> <C> <C> <C>
Fixed Income $69,506,438 $ 59,600,888 $144,593,744 $131,853,246
Global Fixed Income 79,097,036 108,742,015 9,808,921 11,805,050
Intermediate Government 0 0 61,570,880 50,413,561
New York Municipal 79,189,466 87,267,702 0 0
</TABLE>
28
- --------------------------------------------------------------------------------
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
WARBURG PINCUS FIXED INCOME FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 1995
- --------------------------------------------------------------------------------
At October 31, 1995, the net unrealized appreciation from investments for
those securities having an excess of value over cost and net unrealized
depreciation from investments for those securities having an excess of cost over
value (based on cost for Federal income tax purposes) was as follows:
<TABLE>
<CAPTION>
NET UNREALIZED
UNREALIZED UNREALIZED APPRECIATION
FUND APPRECIATION DEPRECIATION (DEPRECIATION)
- ------------------------------------------------ ------------ ------------ --------------
<S> <C> <C> <C>
Fixed Income $2,550,123 $ (1,273,784) $1,276,339
Global Fixed Income 1,658,696 (1,472,059) 186,637
Intermediate Government 1,299,887 (263,103) 1,036,784
New York Municipal 1,976,753 (16,768) 1,959,985
</TABLE>
4. FORWARD FOREIGN CURRENCY CONTRACTS
The Fixed Income Fund and the Global Fixed Income Fund may enter into
forward currency contracts for the purchase or sale of a specific foreign
currency at a fixed price on a future date. Risks may arise upon entering into
these contracts from the potential inability of counterparties to meet the terms
of their contracts and from unanticipated movements in the value of a foreign
currency relative to the U.S. dollar. The Funds will enter into forward
contracts primarily for hedging purposes. The forward currency contracts are
adjusted by the daily exchange rate of the underlying currency and any gains or
losses are recorded for financial statement purposes as unrealized until the
contract settlement date.
At October 31, 1995, the Global Fixed Income Fund had the following open
forward foreign currency contracts:
<TABLE>
<CAPTION>
FOREIGN UNREALIZED
FORWARD CURRENCY EXPIRATION CURRENCY CONTRACT CONTRACT FOREIGN EXCHANGE
CONTRACT DATE TO BE SOLD AMOUNT VALUE GAIN (LOSS)
- ------------------------ ---------- ---------- ----------- ----------- ----------------
<S> <C> <C> <C> <C> <C>
Australian Dollars 12/18/95 914,990 $ 690,818 $ 695,209 $ (4,391)
British Pounds 12/27/95 3,510,984 5,435,003 5,541,737 (106,734)
Danish Krone 12/18/95 29,059,448 5,281,904 5,319,710 (37,806)
German Marks 11/29/95 14,200,000 9,588,116 10,109,640 (521,524)
German Marks 11/29/95 375,092 255,164 267,045 (11,881)
German Marks 12/18/95 10,514,444 1,918,694 1,924,806 (6,112)
German Marks 12/18/95 10,513,889 1,934,834 1,924,704 10,130
German Marks 12/18/95 6,013,700 4,243,966 4,285,704 (41,738)
Irish Punt 12/18/95 2,881,250 4,639,677 4,671,371 (31,694)
Netherlands Guilder 11/29/95 4,577,075 2,760,600 2,896,883 (136,283)
Netherlands Guilder 11/29/95 79,014 49,138 50,009 (871)
----------- ----------- ----------------
$36,797,914 $37,686,818 $ (888,904)
----------- ----------- ----------------
----------- ----------- ----------------
</TABLE>
5. FUTURES CONTRACTS
Each Fund may enter into futures contracts for hedging purposes to the
extent permitted by its investment policies and objectives. To enter into a
futures contract, a Fund must make a deposit of an initial margin with its
custodian in a segregated account. Subsequent payments, which are dependent on
29
- --------------------------------------------------------------------------------
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
WARBURG PINCUS FIXED INCOME FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 1995
- --------------------------------------------------------------------------------
the daily fluctuations in the value of the underlying instrument, are made or
received by a Fund each day (daily variation margin) and are recorded as
unrealized gains or losses until the contracts are closed. When the contract is
closed, a Fund records a realized gain or loss equal to the difference between
the proceeds from (or cost of) the closing transactions and a Fund's basis in
the contract. Risks of entering into futures contracts include the possibility
that a change in the value of the contract may not correlate with the changes in
the value of the underlying instruments. The Fixed Income Fund and the Global
Fixed Income Fund entered into futures contracts during the year ended October
31, 1995. However, the Fixed Income Fund and Global Fixed Income Fund had no
futures contracts open at October 31, 1995.
6. CAPITAL SHARE TRANSACTIONS
The Global Fixed Income Fund and the Intermediate Government Fund are each
authorized to issue three billion full and fractional shares of capital stock,
$.001 par value per share, of which one billion shares are designated Series 2
Shares (the Advisor Shares). The Fixed Income Fund and the New York Municipal
Fund are each authorized to issue an unlimited number of full and fractional
shares of beneficial interest, $.001 par value per share, of which one billion
shares are designated Series 2 Shares (the Advisor Shares). At October 31, 1995,
no Advisor Shares were outstanding.
30
- --------------------------------------------------------------------------------
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
[THIS PAGE INTENTIONALLY LEFT BLANK]
31
- --------------------------------------------------------------------------------
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
WARBURG PINCUS FIXED INCOME FUNDS
NOTES TO FINANCIAL STATEMENTS (CONT'D)
October 31, 1995
- --------------------------------------------------------------------------------
6. CAPITAL SHARE TRANSACTIONS (cont'd)
Transactions in shares of each Fund were as follows:
<TABLE>
<CAPTION>
FIXED INCOME FUND GLOBAL FIXED INCOME FUND
For the Year Ended October 31, For the Year Ended October 31,
---------------------------------------- ----------------------------------
1995 1994 1995 1994
------------------- ------------------- ---------------- ----------------
<S> <C> <C> <C> <C>
Shares sold 4,918,036 5,837,372 4,066,768 5,678,256
Shares issued to
shareholders on
reinvestment of
dividends 672,751 566,407 281,288 350,063
Shares redeemed (4,609,035) (3,561,347) (7,231,335) (2,829,142)
------------------- ------------------- ---------------- ----------------
Net increase (decrease)
in shares outstanding 981,752 2,842,432 (2,883,279) 3,199,177
------------------- ------------------- ---------------- ----------------
------------------- ------------------- ---------------- ----------------
</TABLE>
7. NET ASSETS
Net assets at October 31, 1995, consisted of the following:
<TABLE>
<CAPTION>
FIXED INCOME FUND GLOBAL FIXED INCOME FUND
---------------------------- ------------------------
<S> <C> <C>
Capital contributed, net $116,808,286 $ 63,963,915
Accumulated net investment income
(loss) (66,850) 1,917,795
Accumulated net realized gain
(loss) from security transactions (1,034,867) (1,533,335)
Net unrealized appreciation
(depreciation) from investments
and foreign currency related
items 1,276,339 (707,331)
---------------- ------------------------
Net assets $116,982,908 $ 63,641,044
---------------- ------------------------
---------------- ------------------------
</TABLE>
8. CAPITAL LOSS CARRYOVER
At October 31, 1995, capital loss carryovers available to offset possible
future capital gains of each Fund were as follows:
<TABLE>
<CAPTION>
Capital Loss Carryover Total Capital
Expiring In Loss Carryover
-------------------------- --------------
2002 2003
---------- ----------
<S> <C> <C> <C>
Fixed Income $1,034,867 $1,034,867
Global Fixed Income 653,329 1,284,612 1,937,941
32
- --------------------------------------------------------------------------------
<PAGE>
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<CAPTION>
INTERMEDIATE GOVERNMENT FUND NEW YORK MUNICIPAL FUND
For the Year Ended October 31, For the Year Ended October 31,
---------------------------------------- ----------------------------------
1995 1994 1995 1994
------------------- ------------------- ---------------- ----------------
<C> <C> <C> <C>
2,723,498 2,426,890 3,181,012 4,835,896
230,993 538,360 299,821 328,635
(2,323,291) (5,159,908) (3,957,382) (4,178,180)
------------------- ------------------- ---------------- ----------------
631,200 (2,194,658) (476,549) 986,351
------------------- ------------------- ---------------- ----------------
------------------- ------------------- ---------------- ----------------
<CAPTION>
INTERMEDIATE GOVERNMENT FUND NEW YORK MUNICIPAL FUND
------------------------------------------ ---------------------------------
<C> <C>
$ 54,407,628 $ 70,580,636
(5,346) 0
458,837 818,908
1,036,784 1,961,933
--------------- ---------------
$ 55,897,903 $ 73,361,477
--------------- ---------------
--------------- ---------------
</TABLE>
33
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<PAGE>
<PAGE>
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WARBURG PINCUS FIXED INCOME FUNDS
REPORT OF INDEPENDENT ACCOUNTANTS
- --------------------------------------------------------------------------------
To the Boards of Directors, Trustees and Shareholders of
Warburg Pincus Fixed Income Funds:
We have audited the accompanying statement of assets and liabilities including
the schedule of investments of the Warburg Pincus Intermediate Maturity
Government Fund and the statements of net assets of the Warburg Pincus Fixed
Income Fund, Warburg Pincus Global Fixed Income Fund and Warburg Pincus New York
Intermediate Municipal Fund (all Funds collectively referred to as the 'Warburg
Pincus Fixed Income Funds') as of October 31, 1995, and the related statements
of operations for the year then ended and the statements of changes in net
assets for each of the two years and the financial highlights for each of the
three years in the period then ended. These financial statements and financial
highlights are the responsibility of the Funds' management. Our responsibility
is to express an opinion on these financial statements and financial highlights
based on our audits. The financial highlights of each of the Warburg Pincus
Fixed Income Funds for each of the two years in the period ended October 31,
1992, were audited by other auditors, whose report dated December 15, 1992,
expressed an unqualified opinion.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
October 31, 1995, by correspondence with the custodians and brokers. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of each
of the Warburg Pincus Fixed Income Funds as of October 31, 1995, and the results
of their operations for the year then ended, and the changes in their net assets
for each of the two years and the financial highlights for each of the three
years in the period then ended, in conformity with generally accepted accounting
principles.
COOPERS & LYBRAND L.L.P.
2400 Eleven Penn Center
Philadelphia, PA
December 14, 1995
34
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<PAGE>
<PAGE>
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<TABLE>
<S> <C>
INVESTMENT ADVISER TRANSFER AGENT
Warburg, Pincus Counsellors, Inc. State Street Bank and Trust Company
466 Lexington Avenue 225 Franklin Street
New York, New York 10017-3147 Boston, Massachusetts 02110
DISTRIBUTOR
Counsellors Securities Inc.
466 Lexington Avenue
New York, New York 10017-3147
</TABLE>
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<PAGE>
<PAGE>
WARBURG PINCUS FUNDS
P.O. BOX 9030
BOSTON, MASSACHUSETTS 02205-9030
SHAREHOLDER SERVICES
1-800-888-6878
PROSPECTUSES
1-800-257-5614
[LOGO]
ANNUAL REPORT
OCTOBER 31, 1995
[ ] WARBURG PINCUS
FIXED INCOME FUND
[ ] WARBURG PINCUS
GLOBAL FIXED INCOME FUND
[ ] WARBURG PINCUS
INTERMEDIATE MATURITY
GOVERNMENT FUND
[ ] WARBURG PINCUS
NEW YORK INTERMEDIATE
MUNICIPAL FUND
WPBDF-2-1095
STATEMENT OF DIFFERENCES
------------------------
The dagger symbol shall be expressed as 'D'
The division sign shall be expressed as [div]
