<PAGE>
<PAGE>
Dear Shareholder:
After an extended rally, the bull market weakened over the period while
disparity among sector returns increased. With suggestions that economic growth
had picked up, particularly in the U.S. and Japan, prospects for further
interest rate cuts became less certain. This belief, coupled with inflationary
fears, shifted fixed-income market leadership away from last year's
top-performing U.S. Treasuries toward other market sectors.
Despite these changes in the market, the Trust's portfolio continued to perform
well. Its six-month total return at net asset value was 5.85%. Its dividend
yield was 9.27% as of April 30, 1996.(1)
Investment Breakdown:
Oppenheimer Multi-Government
Trust as of 4/30/96(2)
[GRAPHIC REPRESENTATION OF THE BREAKDOWN]
Foreign government obligations: 41.8%
U.S. government obligations: 36.6%
U.S. corporate bonds & notes: 9.0%
Foreign corporate bonds & notes: 6.4%
Structured notes:4.1%
Short-term securities: 1.8%
Equity securities: 0.3%
During the period, we increased our holdings in international bonds, while we
maintained our position in high yield bonds. The Trust benefited from this
positioning; in addition to offering a higher level of income than U.S.
government bonds, high yield and international bonds represented the strongest
performing sectors of the market over the period.(2)
High yield bonds led the market in price performance and continued to offer
higher income than lower-risk investment-grade bonds. Moderate default rates and
the issuers' ability to pay down debt, coupled with the strong U.S. equity
market, contributed to their strong performance.
Overseas, falling interest rates in Europe continued to push bond prices higher.
Meanwhile, these markets continued to offer yields well above those available in
the U.S. In the emerging markets of Southeast Asia, Latin America and Eastern
Europe, growing consumer demand, solidifying balance sheets, and improving
creditworthiness continued to provide significant opportunities for capital
appreciation.
The portfolio also benefited from maintaining a short average maturity in the
U.S. government sector, which resulted in low price sensitivity to interest rate
changes. This positioning was advantageous, because as domestic interest rates
increased, shorter maturity bonds generated the best price performance. In
addition, the sector was aided by an overweighting in mortgage-backed
securities.(3) They were able to out-perform Treasuries because as rates rose,
prepayments slowed.
<PAGE>
<PAGE>
At the current time, we are repositioning the portfolio for what we believe will
be a slower domestic growth scenario over the next six to twelve months. In high
yield bonds, we are moving our holdings into the relatively higher credit
quality segment of the non-investment-grade market. We're also extending the
average maturity of our U.S. government assets, as slower economic growth may
lead to lower interest rates later in the year.
Finally we continue to favor international markets, particularly
emerging-markets debt. We believe Latin America, where economies and markets are
rebounding, has further upside potential. Several Eastern European markets also
look promising, and we expect Western European debt to outperform the U.S.
government market this year. Unlike U.S. government securities, many foreign
investments entail currency risk. For this reason, we've had a currency hedge in
place designed to protect a portion of our overseas assets from a rising U.S.
dollar.
Thank you for your confidence in OppenheimerFunds. We look forward to helping
you meet your financial goals in the future.
Sincerely,
/s/ BRIDGET A. MACASKILL
Bridget A. Macaskill
President
Oppenheimer Multi-Government Trust
April 30, 1996
1. Total return is based on the change in net asset value per share from 4/30/95
to 4/30/96, without deducting any brokerage costs. Dividend yield is determined
by annualizing the April 1996 dividend of $0.056 and dividing by the closing
price on the New York Stock Exchange of $7.25 per share on 4/26/96 (payment
date). Past performance does not guarantee future results.
2. Portfolio composition is subject to change. Chart is based on total
investments at market value rather than net assets.
3. These securities involve risks from early prepayment of underlying mortgages
that can affect the Trust's income and principal value.
<PAGE>
<PAGE>
STATEMENT OF INVESTMENTS April 30, 1996 (Unaudited)
Oppenheimer Multi-Government Trust
<TABLE>
<CAPTION>
Market Value
Face Amount (1) See Note 1
--------------- -----------
<S> <C> <C>
CERTIFICATES OF DEPOSIT -- 1.4%
Bank Pacific CD, Zero Coupon, 17.948%, 3/5/96 (2)(3)(4) (IDR).............. 500,000,000 $ 107,323
CS First Boston, Inc. CD, 15.75%, 6/11/96 (2)(5) (IDR)..................... 556,000,000 238,686
Indonesia (Republic of) Bank Negara CD, Zero Coupon, 15.914%, 6/17/96
(2)(4) (IDR)............................................................. 1,000,000,000 420,176
-----------
Total Certificates of Deposit (Cost $904,723).............................. 766,185
-----------
MORTGAGE-BACKED OBLIGATIONS -- 23.4%
GOVERNMENT AGENCY -- 22.3%
FHLMC/FNMA/Sponsored -- 9.9%
Federal Home Loan Mortgage Corp.:
Collateralized Mtg. Obligations, Gtd. Multiclass Mtg.
Participation Certificates, 6.65%, 4/15/21............................... 1,549,800 1,485,375
Mtg.-Backed Certificates, 11.50%, 1/1/18................................. 131,201 148,158
Mtg.-Backed Certificates, 13%, 5/1/19.................................... 524,867 614,751
Federal National Mortgage Assn., Interest-Only Stripped Mtg.-Backed
Security:
Trust 222, Cl. 2, 11.456%, 6/1/23 (6).................................... 6,279,656 2,104,666
Trust 240, Cl. 2, 12.908%-13.152%, 9/1/23-2/1/24 (6)..................... 1,632,162 557,694
Trust 257, Cl. 2, 17.56%, 2/1/24 (6)..................................... 978,008 335,579
-----------
5,246,223
-----------
GNMA/Guaranteed -- 12.4%
Government National Mortgage Assn.:
7%, 5/1/26 (7)........................................................... 2,500,000 2,407,025
7%, 1/15/24-5/15/24...................................................... 3,699,901 3,567,924
7.50%, 5/15/24-1/15/26................................................... 611,201 604,741
-----------
6,579,690
-----------
PRIVATE -- 1.1%
Commercial -- 1.1%
Morgan Stanley Capital I, Inc., Commercial Mtg. Pass-Through Certificates,
Series 1996-C1, Cl. E, 7.51%, 2/1/28 (8)................................. 553,342 434,201
Resolution Trust Corp., Commercial Mtg. Pass-Through Certificates, Series
1995-C1, Cl. F, 6.90%, 2/25/27........................................... 212,572 174,110
-----------
608,311
-----------
Total Mortgage-Backed Obligations (Cost $12,109,522)....................... 12,434,224
-----------
U.S. GOVERNMENT OBLIGATIONS -- 13.5%
U.S. Treasury Nts.:
6.25%, 2/15/03........................................................... 5,000,000 4,912,500
7.75%, 1/31/00........................................................... 400,000 418,500
8%, 10/15/96 (14)........................................................ 1,800,000 1,820,811
-----------
Total U.S. Government Obligations (Cost $7,223,755)........................ 7,151,811
-----------
</TABLE>
3
<PAGE>
<PAGE>
STATEMENT OF INVESTMENTS April 30, 1996 (Unaudited) (Continued)
Oppenheimer Multi-Government Trust
<TABLE>
<CAPTION>
Market Value
Face Amount (1) See Note 1
--------------- -----------
FOREIGN GOVERNMENT OBLIGATIONS -- 42.1%
<S> <C> <C>
ALGERIA -- 1.6%
Algeria (Republic of) Reprofiled Debt Loan Participation, Tranche A,
6.812%, 9/4/06 (8)(10)................................................... $ 1,500,000 $ 847,500
-----------
ARGENTINA -- 4.2%
Argentina (Republic of):
Bonds, Bonos del Tesoro, Series 10, 5.469%, 4/1/00 (10).................. 252,468 236,246
Past Due Interest Bonds, Series L, 6.312%, 3/31/05 (10).................. 99,000 75,735
Sr. Unsec. Unsub. Bonds, 13.45%, 10/21/97 (ITL).......................... 1,000,000,000 654,336
Banco Hipotecario Nacional (Argentina) Medium-Term Nts., 10.625%, 3/29/99
(8)...................................................................... 250,000 251,250
Buenos Aires (Province of):
Bonds, 10%, 3/5/01 (DEM)................................................. 1,160,000 779,123
Sr. Unsub. Unsec. Nts., 10%, 12/7/98 (DEM)............................... 350,000 241,927
-----------
2,238,617
-----------
AUSTRALIA -- 1.3%
Australia (Commonwealth of) Bonds, 12.50%, 1/15/98 (AUD)................... 40,000 33,663
First Australia National Mortgage Acceptance Corp. Ltd. Bonds, Series 22,
11.40%, 12/15/01 (AUD)................................................... 481,950 404,911
New South Wales Treasury Corp. Gtd. Bonds, 12%, 12/1/01 (AUD).............. 285,000 257,028
-----------
695,602
-----------
BRAZIL -- 1.3%
Banco do Estado de Sao Paulo SA Nts., 9.25%, 10/4/96....................... 250,000 248,750
Banco Estado Minas Gerais, 8.25%, 2/10/00.................................. 500,000 445,000
Brazil (Federal Republic of) Interest Due and Unpaid Bonds, 6.375%, 1/1/01
(10)..................................................................... 13,950 12,851
-----------
706,601
-----------
BULGARIA -- 0.3%
Bulgaria (Republic of) Disc. Bonds, Tranche A, 6.25%, 7/28/24 (10)......... 300,000 149,625
-----------
CANADA -- 2.4%
Canada (Government of) Bonds, 7.75%, 9/1/99 (CAD).......................... 1,698,000 1,288,976
-----------
COLOMBIA -- 0.2%
Colombia (Republic of) Concorde Loan Participation, 6.188%, 1/31/98
(8)(10).................................................................. 92,500 91,112
-----------
COSTA RICA -- 0.6%
Central Bank of Costa Rica Interest Claim Bonds, Series A, 6.094%, 5/21/05
(10)..................................................................... 352,851 315,802
-----------
DENMARK -- 0.6%
Denmark (Kingdom of) Bonds, 8%, 5/15/03 (DKK).............................. 1,640,000 296,500
-----------
</TABLE>
4
<PAGE>
<PAGE>
STATEMENT OF INVESTMENTS April 30, 1996 (Unaudited) (Continued)
Oppenheimer Multi-Government Trust
<TABLE>
<CAPTION>
Market Value
Face Amount (1) See Note 1
--------------- -----------
FOREIGN GOVERNMENT OBLIGATIONS (CONTINUED)
<S> <C> <C>
ECUADOR -- 0.7%
Ecuador (Republic of) Disc. Bonds, 6.063%, 2/28/25 (10).................... $ 630,000 $ 352,800
-----------
FINLAND -- 0.6%
Finland (Republic of) Bonds, 9.50%, 3/15/04 (FIM).......................... 1,270,000 294,273
-----------
GREAT BRITAIN -- 4.4%
United Kingdom Treasury Nts., 13%, 7/14/00 (9) (GBP)....................... 1,295,000 2,340,658
-----------
IRELAND -- 0.7%
National Treasury Management Agency (Irish Government) Bonds, 8%, 10/18/00
(IEP).................................................................... 240,000 390,019
-----------
ITALY -- 0.6%
Italy (Republic of) Treasury Bonds, Buoni del Tesoro Poliennali, 10.50%,
11/1/98 (ITL)............................................................ 450,000,000 298,464
-----------
JAMAICA -- 0.3%
Jamaica (Government of) 1990 Refinancing Agreement Nts., Tranche A, 6.344%,
10/16/00 (8)(10)......................................................... 175,000 164,500
-----------
JORDAN -- 2.0%
Hashemite Kingdom of Jordan Interest Arrears Bonds, 6.438%, 12/23/05
(10)..................................................................... 1,300,000 1,036,750
-----------
MEXICO -- 4.4%
Banco Nacional de Comercio Exterior SNC International Finance BV:
Gtd. Bonds, 12.65%, 6/21/98 (ESP)........................................ 35,000,000 281,669
Medium-Term Nts., 8%, 4/14/00............................................ 125,000 116,719
Bonos de la Tesoreria de la Federacion, Zero Coupon, 37.786%, 3/6/97 (4)
(MXP).................................................................... 1,600,000 163,654
United Mexican States:
Bonds, 10.375%, 1/29/03 (DEM)............................................ 1,855,000 1,239,876
Combined Facility 3, Loan Participation Agreement, Tranche A, 6.50%,
9/20/97 (8)(10)....................................................... 52,400 43,230
Nacional Financiera SNC Nts., 13.60%, 4/2/98 (ESP)....................... 50,000,000 410,726
Petroleos Mexicanos Gtd. Medium-Term Nts., 7.60%, 6/15/00................ 100,000 94,250
-----------
2,350,124
-----------
MOROCCO -- 0.7%
Morocco (Kingdom of) Loan Participation Agreement:
Tranche A, 6.594%, 1/1/09 (10)........................................... 420,000 301,744
Tranche B, 6.521%, 1/1/04 (10)........................................... 94,117 75,412
-----------
377,156
-----------
NEW ZEALAND -- 1.8%
New Zealand (Republic of) Bonds, 8%, 2/15/01 (NZD)......................... 1,460,000 969,175
-----------
</TABLE>
5
<PAGE>
<PAGE>
STATEMENT OF INVESTMENTS April 30, 1996 (Unaudited) (Continued)
Oppenheimer Multi-Government Trust
<TABLE>
<CAPTION>
Market Value
Face Amount (1) See Note 1
--------------- -----------
FOREIGN GOVERNMENT OBLIGATIONS (CONTINUED)
<S> <C> <C>
NORWAY -- 0.2%
Norwegian Government Bonds, 9.50%, 10/31/02 (NOK).......................... 445,000 $ 79,625
-----------
PANAMA -- 2.5%
Panama (Republic of):
Debs., 6.75%, 5/10/02 (10)............................................... 1,300,000 1,202,500
Past Due Interest Debs., 12/29/49 (7).................................... 250,000 136,625
-----------
1,339,125
-----------
POLAND -- 2.0%
Poland (Republic of) Treasury Bills, Zero Coupon:
21.466%, 10/16/96 (4) (PLZ).............................................. 1,000,000 342,076
20.376%, 3/19/97 (4) (PLZ)............................................... 800,000 253,501
22.382%, 7/24/96 (4) (PLZ)............................................... 1,300,000 465,342
-----------
1,060,919
-----------
PORTUGAL -- 2.2%
Portugal (Republic of) Gtd. Bonds, Obrigicion do tes Medio Prazo, 11.875%,
2/23/00 (PTE)............................................................ 165,000,000 1,175,821
-----------
SPAIN -- 1.6%
Spain (Kingdom of) Gtd. Bonds, Bonos y Obligacion del Estado, 12.25%,
3/25/00 (ESP)............................................................ 96,000,000 849,610
-----------
SUPRANATIONAL -- 2.6%
European Bank for Reconstruction & Development Sr. Unsec. Medium-Term Nts.,
10%, 12/20/96 (CZK)...................................................... 17,000,000 607,360
International Bank for Reconstruction & Development Bonds, 12.50%, 7/25/97
(NZD).................................................................... 1,100,000 785,669
-----------
1,393,029
-----------
SWEDEN -- 0.5%
Sweden (Kingdom of) Bonds, Series 1028, 11%, 1/21/99 (SEK)................. 1,600,000 258,287
-----------
TRINIDAD & TOBAGO -- 0.8%
Trinidad & Tobago Loan Participation Agreement, Tranche A, 1.772%, 9/30/00
(8)(10) (JPY)............................................................ 54,000,000 443,335
-----------
VENEZUELA -- 1.0%
Venezuela (Republic of):
Debs., Series C, 6.75%, 12/31/03 (10).................................... 130,000 97,663
Disc. Bonds, Series DL, 6.563%, 12/18/07 (10)............................ 500,000 327,500
Front-Loaded Interest Reduction Bonds, Series A, 6.375%,
3/31/07 (10).......................................................... 200,000 132,750
-----------
557,913
-----------
Total Foreign Government Obligations (Cost $22,005,323).................... 22,361,918
-----------
</TABLE>
6
<PAGE>
<PAGE>
STATEMENT OF INVESTMENTS April 30, 1996 (Unaudited) (Continued)
Oppenheimer Multi-Government Trust
<TABLE>
<CAPTION>
Market Value
Face Amount (1) See Note 1
--------------- -----------
CORPORATE BONDS AND NOTES -- 15.5%
<S> <C> <C>
BASIC INDUSTRY -- 1.0%
Chemicals -- 0.1%
Acetex Corp., 9.75% Sr. Sec. Nts., 10/1/03................................. $ 50,000 $ 50,250
-----------
Metals/Mining -- 0.2%
Kaiser Aluminum & Chemical Corp., 9.875% Sr. Nts., 2/15/02................. 100,000 100,000
UCAR Global Enterprises, Inc., 12% Sr. Sub. Nts., 1/15/05.................. 25,000 28,750
-----------
128,750
-----------
Paper -- 0.7%
Indah Kiat International Finance Co. BV, 12.50% Sr. Sec. Gtd. Nts., Series
C, 6/15/06............................................................... 100,000 102,250
QUNO Corp., 9.125% Sr. Nts., 5/15/05....................................... 100,000 99,500
Repap Wisconsin, Inc., 9.25% First Priority Sr. Sec. Nts., 2/1/02.......... 100,000 96,500
Riverwood International Corp., 10.25% Sr. Nts., 4/1/06..................... 100,000 100,500
-----------
398,750
-----------
CONSUMER RELATED -- 4.3%
Consumer Products -- 0.4%
Coleman Holdings, Inc., Zero Coupon Sr. Sec. Disc. Nts., Series B, 11.623%,
5/27/98 (4).............................................................. 100,000 83,750
Revlon Consumer Products Corp., 10.50% Sr. Sub. Nts., Series B, 2/15/03.... 100,000 102,750
-----------
186,500
-----------
Food/Beverages/Tobacco -- 0.6%
Doane Products Co., 10.625% Sr. Nts., 3/1/06............................... 50,000 51,000
Pulsar Internacional SA de CV, 11.80% Nts., 9/19/96 (8).................... 250,000 251,250
-----------
302,250
-----------
Healthcare -- 0.6%
Magellan Health Services, Inc., 11.25% Sr. Sub. Nts., Series A, 4/15/04.... 100,000 111,500
Quorum Health Group, Inc., 11.875% Sr. Sub. Nts., 12/15/02................. 100,000 111,250
Tenet Healthcare Corp., 10.125% Sr. Sub. Nts., 3/1/05...................... 100,000 107,500
-----------
330,250
-----------
Hotel/Gaming -- 1.2%
Bally's Park Place Funding, Inc., 9.25% Gtd. First Mtg. Nts., 3/15/04...... 50,000 51,375
Boyd Gaming Corp., 10.75% Sr. Sub. Nts., 9/1/03............................ 100,000 105,750
Capital Gaming International, Inc. Promissory Nts.......................... 2,000 --
Empress River Casino Finance Corp., 10.75% Sr. Gtd. Nts., 4/1/02........... 100,000 104,875
GNF Corp., 10.625% Gtd. First Mtg. Nts., Series B, 4/1/03.................. 50,000 51,750
Grand Casinos, Inc., 10.125% Gtd. First Mtg. Nts., 12/1/03................. 100,000 104,750
</TABLE>
7
<PAGE>
<PAGE>
STATEMENT OF INVESTMENTS April 30, 1996 (Unaudited) (Continued)
Oppenheimer Multi-Government Trust
<TABLE>
<CAPTION>
Market Value
Face Amount (1) See Note 1
--------------- -----------
CORPORATE BONDS AND NOTES (CONTINUED)
CONSUMER RELATED (CONTINUED)
Hotel/Gaming (Continued)
<S> <C> <C>
HMH Properties, Inc., 9.50% Sr. Sec. Nts., 5/15/05......................... $ 100,000 $ 97,625
Trump Atlantic City Associates/Trump Atlantic City Funding, Inc., 11.25%
First Mtg. Nts., 5/1/06.................................................. 100,000 102,875
-----------
619,000
-----------
Restaurants -- 0.2%
Carrols Corp., 11.50% Sr. Nts., 8/15/03.................................... 85,000 86,912
-----------
Textile/Apparel -- 1.3%
Consoltex Group, Inc., 11% Sr. Sub. Gtd. Nts., Series B, 10/1/03........... 100,000 89,250
PT Polysindo Eka Perkasa, Zero Coupon Promissory Nts.:
17.90%, 10/23/96 (4) (IDR)............................................... 1,000,000,000 389,846
19.111%, 2/28/97 (4) (IDR)............................................... 350,000,000 128,574
WestPoint Stevens, Inc., 9.375% Sr. Sub. Debs., 12/15/05................... 100,000 98,500
-----------
706,170
-----------
ENERGY -- 1.5%
Chesapeake Energy Corp., 10.50% Sr. Nts., 6/1/02........................... 100,000 106,125
Falcon Drilling, Inc., 8.875% Sr. Nts., Series B, 3/15/03.................. 100,000 99,000
Kelley Oil & Gas Corp., 13.50% Sr. Nts., 6/15/99........................... 50,000 52,500
Moran Energy, Inc., 8.75% Cv. Sub. Debs., 1/15/08.......................... 200,000 171,847
Petroleum Heat & Power Co., Inc.:
12.25% Sub. Debs., 2/1/05................................................ 49,000 54,758
9.375% Sub. Debs., 2/1/06................................................ 50,000 49,375
Santa Fe Energy Resources, Inc., 11% Sr. Sub. Debs., 5/15/04............... 100,000 109,500
TransTexas Gas Corp., 11.50% Sr. Sec. Gtd. Nts., 6/15/02................... 100,000 100,875
United Meridian Corp., 10.375% Sr. Sub. Nts., 10/15/05..................... 50,000 52,250
-----------
796,230
-----------
FINANCIAL SERVICES -- 3.6%
Banks & Thrifts -- 3.4%
Banco Bamerindus do Brasil SA:
10.50% Debs., 6/23/97.................................................... 300,000 289,500
9% Unsub. Unsec. Bonds, 10/29/98......................................... 90,000 75,600
Banco de Colombia, 5.20% Cv. Jr. Sub. Unsec. Nts., 2/1/99.................. 250,000 226,250
Banco Ganadero SA, Zero Coupon Sr. Unsub. Unsec. Nts., 9.762%, 6/15/96
(4)(5)................................................................... 250,000 247,159
Banco Itamarati SA, 11.625% Sr. Unsec. Debs., 11/23/97..................... 250,000 255,625
Banco Mexicano SA, 8% Sr. Unsub. Unsec. Exchangeable Medium-Term Nts.,
11/4/98.................................................................. 100,000 93,875
</TABLE>
8
<PAGE>
<PAGE>
STATEMENT OF INVESTMENTS April 30, 1996 (Unaudited) (Continued)
Oppenheimer Multi-Government Trust
<TABLE>
<CAPTION>
Market Value
Face Amount (1) See Note 1
--------------- -----------
CORPORATE BONDS AND NOTES (CONTINUED)
FINANCIAL SERVICES (CONTINUED)
Banks & Thrifts (Continued)
<S> <C> <C>
PT Inti Indorayon Utama, Zero Coupon Promissory Nts., 17.234%, 2/12/1997
(4) (IDR)................................................................ 700,000,000 $ 264,620
Morgan Stanley Group, Inc., 14.25% Indian Rupee Indexed Nts., 6/26/96 (2)
(INR).................................................................... 3,141,000 90,391
SCF Finance Co., Zero Coupon Bonds, 10.294%, 6/1/96 (4) (THB).............. 6,500,000 254,259
-----------
1,797,279
-----------
Insurance -- 0.2%
American Life Holding Co., 11.25% Sr. Sub. Nts., 9/15/04................... 100,000 106,000
-----------
HOUSING RELATED -- 0.5%
Homebuilders/Real Estate -- 0.5%
NVR, Inc., 11% Sr. Gtd. Nts., 4/15/03...................................... 100,000 101,500
Tribasa Toll Road Trust, 10.50% Nts., Series 1993-A, 12/1/11 (8)........... 250,000 188,750
-----------
290,250
-----------
MANUFACTURING -- 0.3%
Automotive -- 0.3%
Aftermarket Technology Corp., 12% Sr. Sub. Nts., Series B, 8/1/04.......... 50,000 53,500
JPS Automotive Products Corp., 11.125% Sr. Nts., 6/15/01................... 100,000 102,500
-----------
156,000
-----------
MEDIA -- 1.1%
Broadcasting -- 0.1%
Sinclair Broadcast Group, Inc., 10% Sr. Sub. Nts., 9/30/05................. 50,000 49,000
-----------
Cable Television -- 0.9%
American Telecasting, Inc., 0%/14.50% Sr. Disc. Nts., 6/15/04 (11)......... 99,579 73,688
Bell Cablemedia PLC, 0%/11.875% Sr. Disc. Nts., 9/15/05 (11)............... 100,000 64,000
EchoStar Satellite Broadcasting Corp., 0%/13.125% Sr. Sec. Disc. Nts.,
3/15/04 (5)(11).......................................................... 100,000 62,250
International CableTel, Inc., 0%/11.50% Sr. Deferred Coupon Nts., Series A,
2/1/06 (5)(11)........................................................... 100,000 59,000
TeleWest PLC, 0%/11% Sr. Disc. Debs., 10/1/07 (11)......................... 100,000 62,250
United International Holdings, Inc., Zero Coupon Sr. Sec. Disc. Nts.,
12.495%, 11/15/99 (4).................................................... 100,000 65,000
Videotron Holdings PLC, 0%/11% Sr. Disc. Nts., 8/15/05 (11)................ 100,000 66,500
-----------
452,688
-----------
Diversified Media -- 0.1%
Panamsat LP/Panamsat Capital Corp., 0%/11.375% Sr. Sub. Disc. Nts., 8/1/03
(11)..................................................................... 50,000 42,750
-----------
</TABLE>
9
<PAGE>
<PAGE>
STATEMENT OF INVESTMENTS April 30, 1996 (Unaudited) (Continued)
Oppenheimer Multi-Government Trust
<TABLE>
<CAPTION>
Market Value
Face Amount (1) See Note 1
--------------- -----------
CORPORATE BONDS AND NOTES (CONTINUED)
<S> <C> <C>
OTHER -- 0.3%
Services -- 0.3%
Protection One, Inc., 0%/13.625% Sr. Disc. Nts., 6/30/05 (11).............. $ 200,000 $ 173,000
-----------
RETAIL -- 0.5%
Department Stores -- 0.2%
Federated Department Stores, Inc., 8.125% Sr. Nts., 10/15/02............... 100,000 99,500
-----------
Specialty Retailing -- 0.1%
Finlay Fine Jewelry Corp., 10.625% Sr. Nts., 5/1/03........................ 50,000 48,750
-----------
Supermarkets -- 0.2%
Ralph's Grocery Co., 10.45% Sr. Nts., 6/15/04.............................. 100,000 98,500
-----------
TRANSPORTATION -- 0.2%
Railroads -- 0.1%
Transtar Holdings LP/Transtar Capital Corp., 0%/13.375% Sr. Disc. Nts.,
Series B, 12/15/03 (11).................................................. 100,000 68,250
-----------
Shipping -- 0.1%
Trans Ocean Container Corp., 12.25% Sr. Sub. Nts., 7/1/04.................. 50,000 52,000
-----------
UTILITIES -- 2.2%
Electric Utilities -- 0.2%
El Paso Electric Co., 9.40% First Mtg. Bonds, Series E, 5/1/11............. 100,000 100,250
-----------
Telecommunications -- 2.0%
Arch Communications Group, Inc., 0%/10.875% Sr. Disc. Nts.,
3/15/08 (11)............................................................. 100,000 56,375
Brooks Fiber Properties, Inc., 0%/10.875% Sr. Disc. Nts.,
3/1/06 (5)(11)........................................................... 100,000 55,500
Celcaribe SA, 0%/13.50% Sr. Sec. Nts., 3/15/04 (8)(11)..................... 250,000 202,500
Cellular Communications International, Inc., Zero Coupon Sr. Disc. Nts.,
12.154%, 8/15/00 (4)..................................................... 100,000 60,000
Cellular, Inc., 0%/11.75% Sr. Sub. Disc. Nts., 9/1/03 (11)................. 150,000 123,750
Cencall Communications Corp., 0%/10.125% Sr. Disc. Nts.,
1/15/04 (11)............................................................. 100,000 59,750
Horizon Cellular Telephone LP/Horizon Finance Corp., 0%/11.375% Sr. Sub.
Disc. Nts., 10/1/00 (11)................................................. 150,000 134,250
IntelCom Group (USA), Inc., 0%/13.50% Sr. Disc. Nts., 9/15/05 (12)......... 150,000 93,750
</TABLE>
10
<PAGE>
<PAGE>
STATEMENT OF INVESTMENTS April 30, 1996 (Unaudited) (Continued)
Oppenheimer Multi-Government Trust
<TABLE>
<CAPTION>
Market Value
Face Amount (1) See Note 1
--------------- -----------
CORPORATE BONDS AND NOTES (CONTINUED)
UTILITIES (CONTINUED)
Telecommunications (Continued)
<S> <C> <C>
MFS Communications Co., Inc.:
0%/8.875% Sr. Disc. Nts., 1/15/06 (11)................................... $ 50,000 $ 31,063
0%/9.375% Sr. Disc. Nts., 1/15/04 (11)................................... 150,000 114,188
PriCellular Wireless Corp., 0%/12.25% Sr. Sub. Disc. Nts., 10/1/03 (11).... 150,000 117,000
-----------
1,048,126
-----------
Total Corporate Bonds and Notes (Cost $8,081,382).......................... 8,187,405
-----------
<CAPTION>
Shares
---------------
<S> <C> <C>
COMMON STOCKS -- 0.0%
Finlay Enterprises, Inc. (12).............................................. 333 4,912
Grand Union Co. (12)....................................................... 1,767 11,044
-----------
Total Common Stocks (Cost $32,539)......................................... 15,956
-----------
PREFERRED STOCKS AND OTHER SECURITIES -- 0.2%
Time Warner, Inc., 10.25% Cum., Series K, Exchangeable Preferred Stock
(Cost $100,000) (8)(13).................................................. 100 100,000
-----------
<CAPTION>
Units
---------------
<S> <C> <C>
RIGHTS, WARRANTS AND CERTIFICATES -- 0.0%
American Telecasting, Inc. Wts., Exp. 6/99................................. 500 3,750
Capital Gaming International, Inc. Wts., Exp. 2/99......................... 3,538 106
Cellular Communications International, Inc. Wts., Exp. 8/03................ 100 1,500
IntelCom Group, Inc. Wts., Exp. 9/05 (8)................................... 495 5,940
Protection One, Inc. Wts., Exp. 6/05....................................... 640 8,160
Terex Corp. Rts., Exp. 7/96 (8)............................................ 30 2
-----------
Total Rights, Warrants and Certificates (Cost $16,281)..................... 19,458
-----------
<CAPTION>
Face Amount (1)
---------------
<S> <C> <C>
STRUCTURED INSTRUMENTS -- 4.1%
Bayerische Landesbank Girozentrale, New York Branch, 5.60% CD Linked Nts.,
1/30/97 (indexed to the closing Nikkei 225 Index on 1/23/97 10 yr.
Japanese Yen swap rate & New Zealand Dollar on 1/28/97) (2) (NZD)........ 377,130 276,503
Canadian Imperial Bank, 10% CD British Pound Sterling Maximum Rate Linked
Nts., 11/8/96 (indexed to the 3-month GBP LIBOR, multiplied by 9) (8).... 250,000 255,225
Canadian Imperial Bank of Commerce, New York Branch, 16% CD Linked Nts.,
9/11/96 (indexed to the Russian Federation GKO, Zero Coupon, 9/4/96)..... 250,000 248,625
</TABLE>
11
<PAGE>
<PAGE>
STATEMENT OF INVESTMENTS April 30, 1996 (Unaudited) (Continued)
Oppenheimer Multi-Government Trust
<TABLE>
<CAPTION>
Market Value
Face Amount (1) See Note 1
--------------- -----------
<S> <C> <C>
STRUCTURED INSTRUMENTS (CONTINUED)
ING Baring Securities Ltd., Zero Coupon Promissory Nts., 10.516%, 4/28/97
(4) (CZK)................................................................ 7,650,000 $ 248,100
ING Baring Securities Ltd., Zero Coupon Promissory Nts., 11.128%, 7/18/96
(4)(CZK)................................................................. 7,000,000 246,135
Salomon Brothers, Inc., Zero Coupon Brazilian Credit Linked Nts., 12.38%,
1/3/97 (indexed to the Brazilian National Treasury Nts., Zero Coupon,
1/2/97) (4).............................................................. 400,000 370,240
Salomon Brothers, Inc., Zero Coupon Brazilian Credit Linked Nts., 12.638%,
1/3/97 (indexed to the Brazilian National Treasury Nts., Zero Coupon,
1/2/97) (4).............................................................. 280,000 259,168
United Mexican States Linked Nts. (indexed to the greater of Cetes Option
Amount or USD LIBOR Option Amount, 11/27/96 (8).......................... 250,000 285,937
-----------
Total Structured Instruments (Cost $2,125,275)............................. 2,189,933
-----------
<CAPTION>
Date Strike Contracts
----- --------- --------------
<S> <C> <C>
CALL OPTION PURCHASED -- 0.0%
OTC German Deutsche Mark/U.S. Dollar Call Opt.
(Cost $4,131)................................... 5/2/96 1.495 DEM 842,978 84
PUT OPTION PURCHASED -- 0.0%
OTC German Deutsche Mark/U.S. Dollar Put Opt.
(Cost $16,185).................................. 5/2/96 1.495 DEM 842,978 20,063
</TABLE>
<TABLE>
<CAPTION>
Face Amount (1)
---------------
<S> <C> <C>
REPURCHASE AGREEMENT -- 0.4%
Repurchase agreement with Zion First National Bank, 5.31%, dated 4/30/96,
to be repurchased at $200,030 on 5/1/96, collateralized by U.S. Treasury
Nts., 6.75%-7.50%, 6/30/99-11/15/01, with a value of $204,209 (Cost
$200,000)................................................................ $ 200,000 200,000
-----------
Total Investments, at Value (Cost $52,819,116)............................. 100.6% 53,447,037
Liabilities in Excess of Other Assets...................................... (0.6) (315,972)
--------------- -----------
Net Assets................................................................. 100.0% $53,131,065
--------------- -----------
--------------- -----------
</TABLE>
12
<PAGE>
<PAGE>
STATEMENT OF INVESTMENTS April 30, 1996 (Unaudited) (Continued)
Oppenheimer Multi-Government Trust
1. Face amount is reported in U.S. Dollars, except for those denoted in the
following currencies:
<TABLE>
<S> <C> <C> <C> <C> <C>
AUD -- Australian Dollar INR -- Indian Rupee
CAD -- Canadian Dollar ITL -- Italian Lira
CZK -- Czech Koruna JPY -- Japanese Yen
DEM -- German Deutsche Mark MXP -- Mexican Peso
DKK -- Danish Krone NOK -- Norwegian Krone
ESP -- Spanish Peseta NZD -- New Zealand Dollar
FIM -- Finnish Markka PLZ -- Polish Zloty
GBP -- British Pound Sterling PTE -- Portuguese Escudo
IDR -- Indonesian Rupiah SEK -- Swedish Krona
IEP -- Irish Punt THB -- Thai Baht
</TABLE>
2. Indexed instrument for which the principal amount and/or interest due at
maturity is affected by the relative value of a foreign currency.
3. Issuer is in default. The security is being valued under procedures
established by the Board of Trustees to determine fair value in good faith.
4. For zero coupon bonds, the interest rate shown is the effective yield on the
date of purchase.
5. Represents a security sold under Rule 144A, which is exempt from registration
under the Securities Act of 1933, as amended. This security has been
determined to be liquid under guidelines established by the Board of
Trustees. These securities amount to $662,595 or 1.25% of the Fund's net
assets, at April 30, 1996.
6. Interest-Only Strips represent the right to receive the monthly interest
payments on an underlying pool of mortgage loans. These securities typically
decline in price as interest rates decline. Most other fixed-income
securities increase in price when interest rates decline. The principal
amount of the underlying pool represents the notional amount on which current
interest is calculated. The price of these securities is typically more
sensitive to changes in prepayment rates than traditional mortgage-backed
securities (for example, GNMA pass-throughs). Interest rates disclosed
represent current yields based upon the current cost basis and estimated
timing and amount of future cash flows.
7. When-issued security to be delivered and settled after April 30, 1996.
8. Identifies issues considered to be illiquid -- See Note 8 of Notes to
Financial Statements.
9. A sufficient amount of liquid assets has been designated to cover outstanding
written call options, as follows:
<TABLE>
<CAPTION>
Contracts Expiration Exercise Premium Market Value
Subject to Call Date Price Received See Note 1
--------------- ---------- --------- ------- ------------
<S> <C> <C> <C> <C> <C>
OTC Australian Dollar Call Opt........... 172,810 5/20/96 1.273 AUD $1,400 $1,192
OTC Australian Dollar Call Opt........... 86,482 5/24/96 1.272 AUD 739 597
OTC Australian Dollar Call Opt........... 86,757 5/28/96 1.268 AUD 703 460
OTC German Deutsche Mark/U.S. Dollar Call
Opt.................................... 842,979 5/2/96 1.495 DEM 20,316 84
------- ------
$23,158 $2,333
------- ------
------- ------
</TABLE>
10. Represents the current interest rate for a variable rate security.
11. Denotes a step bond: a zero coupon bond that converts to a fixed rate of
interest at a designated future date.
12. Non-income producing security.
13. Interest or dividend is paid in kind.
14. Securities with an aggregate market value of $50,625 are held in
collateralized accounts to cover initial margin requirements on open futures
sales contracts. See Note 6 of Notes to Financial Statements.
See accompanying Notes to Financial Statements.
13
<PAGE>
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES April 30, 1996 (Unaudited)
Oppenheimer Multi-Government Trust
<TABLE>
<S> <C>
ASSETS:
Investments, at value (cost $52,819,116) -- see accompanying statement.................... $53,447,037
Cash........................................................................................ 520,276
Unrealized appreciation on forward foreign currency exchange contracts -- Note 5.......... 64,296
Receivables:
Investments sold.......................................................................... 2,734,355
Interest.................................................................................. 1,048,822
Closed forward foreign currency exchange contracts........................................ 18,277
Other....................................................................................... 25,322
-----------
Total assets........................................................................... 57,858,385
-----------
LIABILITIES:
Options written, at value (premiums received $23,158) -- see accompanying
statement -- Note 7..................................................................... 2,333
Unrealized depreciation on forward foreign currency exchange contracts -- Note 5.......... 1,070
Payables and other liabilities:
Investments purchased..................................................................... 4,499,793
Dividends................................................................................. 63,701
Trustees' fees............................................................................ 57,114
Shareholder reports....................................................................... 53,357
Closed forward foreign currency exchange contracts........................................ 11,084
Management and administrative fees........................................................ 10,574
Daily variation on futures contracts -- Note 6.......................................... 9,375
Other..................................................................................... 18,919
-----------
Total liabilities...................................................................... 4,727,320
-----------
NET ASSETS.................................................................................. $53,131,065
-----------
-----------
COMPOSITION OF NET ASSETS:
Par value of shares of beneficial interest.................................................. $ 66,155
Additional paid-in capital.................................................................. 59,784,052
Undistributed net investment income......................................................... 108,509
Accumulated net realized loss on investments and foreign currency transactions.............. (7,502,894)
Net unrealized appreciation on investments and translation of assets and liabilities
denominated in foreign currencies......................................................... 675,243
-----------
NET ASSETS -- applicable to 6,615,505 shares of beneficial interest outstanding........... $53,131,065
-----------
-----------
NET ASSET VALUE PER SHARE................................................................... $8.03
-----
-----
</TABLE>
See accompanying Notes to Financial Statements.
14
<PAGE>
<PAGE>
STATEMENT OF OPERATIONS For the Six Months Ended April 30, 1996 (Unaudited)
Oppenheimer Multi-Government Trust
<TABLE>
<S> <C>
INVESTMENT INCOME:
Interest..................................................................................... $2,755,058
----------
EXPENSES:
Management fees -- Note 4.................................................................. 170,924
Administrative fees -- Note 4.............................................................. 52,592
Custodian fees and expenses.................................................................. 23,425
Trustees' fees and expenses -- Note 1...................................................... 37,109
Shareholder reports.......................................................................... 25,718
Transfer agent and accounting service fees -- Note 4....................................... 20,888
Legal and auditing fees...................................................................... 10,426
Registration and filing fees................................................................. 2,308
Other........................................................................................ 1,226
----------
Total expenses........................................................................ 344,616
----------
NET INVESTMENT INCOME........................................................................ 2,410,442
----------
REALIZED AND UNREALIZED GAIN (LOSS):
Net realized gain (loss) on:
Investments................................................................................ 671,472
Closing of futures contracts............................................................... (128,529)
Closing and expiration of options written.................................................. (68,908)
Foreign currency transactions.............................................................. 49,687
----------
Net realized gain..................................................................... 523,722
----------
Net change in unrealized appreciation or depreciation on:
Investments................................................................................ 458,964
Translation of assets and liabilities denominated in foreign currencies.................... (379,158)
----------
Net change............................................................................ 79,806
----------
NET REALIZED AND UNREALIZED GAIN............................................................. 603,528
----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS......................................... $3,013,970
----------
----------
</TABLE>
See accompanying Notes to Financial Statements.
15
<PAGE>
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
Oppenheimer Multi-Government Trust
<TABLE>
<CAPTION>
Six Months Ended
April 30, Year Ended
1996 October 31,
(Unaudited) 1995
---------------- ----------------
<S> <C> <C>
OPERATIONS:
Net investment income....................................................... $ 2,410,442 $ 4,710,494
Net realized gain (loss).................................................... 523,722 (1,281,279)
Net change in unrealized appreciation or depreciation....................... 79,806 943,379
---------------- ----------------
Net increase in net assets resulting from operations................... 3,013,970 4,372,594
---------------- ----------------
DIVIDENDS TO SHAREHOLDERS FROM NET INVESTMENT INCOME........................ (2,222,784) (4,472,033)
---------------- ----------------
NET ASSETS:
Total increase (decrease)................................................... 791,186 (99,439)
Beginning of period......................................................... 52,339,879 52,439,318
---------------- ----------------
End of period [including undistributed (overdistributed) net investment
income of $108,509 and $(79,149), respectively]........................... $ 53,131,065 $ 52,339,879
---------------- ----------------
---------------- ----------------
</TABLE>
See accompanying Notes to Financial Statements.
16
<PAGE>
<PAGE>
FINANCIAL HIGHLIGHTS
Oppenheimer Multi-Government Trust
<TABLE>
<CAPTION>
Six Months
Ended
April 30, Year Ended October 31,
1996 -------------------------------------------------------
(Unaudited) 1995 1994 1993 1992 1991
----------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING DATA:
Net asset value, beginning of period $ 7.91 $ 7.93 $ 8.54 $ 8.55 $ 8.97 $ 8.66
----------- ------- ------- ------- ------- -------
Income (loss) from investment
operations:
Net investment income................ .37 .71 .69 .82 .89 .97
Net realized and unrealized gain
(loss)............................. .09 (.05) (.61) -- (.39) .33
----------- ------- ------- ------- ------- -------
Total income from investment
operations....................... .46 .66 .08 .82 .50 1.30
----------- ------- ------- ------- ------- -------
Dividends and distributions to
shareholders:
Dividends from net investment
income............................. (.34) (.68) (.68) (.75) (.92) (.99)
Tax return of capital distribution... -- -- (.01) (.08) -- --
----------- ------- ------- ------- ------- -------
Total dividends and distributions
to shareholders.................. (.34) (.68) (.69) (.83) (.92) (.99)
----------- ------- ------- ------- ------- -------
Net asset value, end of period......... $ 8.03 $ 7.91 $ 7.93 $ 8.54 $ 8.55 $ 8.97
----------- ------- ------- ------- ------- -------
----------- ------- ------- ------- ------- -------
Market value, end of period............ $ 7.13 $ 7.00 $ 7.00 $ 8.00 $ 8.63 $ 9.50
TOTAL RETURN, AT MARKET VALUE(1)....... 6.21% 9.09% (4.84)% 2.22% 0.70% 37.18%
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (in
thousands)........................... $53,131 $52,340 $52,439 $56,526 $55,668 $57,208
Average net assets (in thousands)...... $52,878 $51,207 $54,380 $55,877 $56,970 $55,604
Ratios to average net assets:
Net investment income.............. 9.17%(2) 9.20% 8.90% 9.59% 10.13% 11.06%
Expenses........................... 1.31%(2) 1.24% 1.24% 1.22% 1.32% 1.21%
Portfolio turnover rate(3)............. 146.9% 344.2% 315.5% 112.5% 98.4% 59.9%
</TABLE>
(1) Assumes a hypothetical purchase at the current market price on the business
day before the first day of the fiscal period, with all dividends and
distributions reinvested in additional shares on the reinvestment date, and
a sale at the current market price on the last business day of the period.
Total return does not reflect sales charges or brokerage commissions. Total
returns are not annualized for periods of less than one full year.
(2) Annualized.
(3) The lesser of purchases or sales of portfolio securities for a period,
divided by the monthly average of the market value of portfolio securities
owned during the period. Securities with a maturity or expiration date at
the time of acquisition of one year or less are excluded from the
calculation. Purchases and sales of investment securities (excluding
short-term securities) for the period ended April 30, 1996 were $72,565,611
and $68,898,164, respectively.
See accompanying Notes to Financial Statements.
17
<PAGE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Unaudited)
Oppenheimer Multi-Government Trust
1. SIGNIFICANT ACCOUNTING POLICIES
Oppenheimer Multi-Government Trust (the Trust) is registered under the
Investment Company Act of 1940, as amended, as a diversified, closed-end
management investment company. The Trust's investment objective is to seek high
current income consistent with preservation of capital. The Trust's investment
advisor is OppenheimerFunds, Inc. (the Manager). The following is a summary of
significant accounting policies consistently followed by the Trust.
Investment Valuation -- Portfolio securities are valued at the close of the
New York Stock Exchange on the last day of each week on which day the New York
Stock Exchange is open. Listed and unlisted securities for which such
information is regularly reported are valued at the last sale price of the day
or, in the absence of sales, at values based on the closing bid or asked price
or the last sale price on the prior trading day. Long-term and short-term
'non-money market' debt securities are valued by a portfolio pricing service
approved by the Board of Trustees. Such securities which cannot be valued by the
approved portfolio pricing service are valued using dealer-supplied valuations
provided the Manager is satisfied that the firm rendering the quotes is reliable
and that the quotes reflect current market value, or are valued under
consistently applied procedures established by the Board of Trustees to
determine fair value in good faith. Short-term 'money market type' debt
securities having a remaining maturity of 60 days or less are valued at cost (or
last determined market value) adjusted for amortization to maturity of any
premium or discount. Forward foreign currency contracts are valued based on the
closing prices of the forward currency contract rates in the London foreign
exchange markets on a daily basis as provided by a reliable bank or dealer.
Options are valued based upon the last sale price on the principal exchange on
which the option is traded or, in the absence of any transactions that day, the
value is based upon the last sale price on the prior trading date if it is
within the spread between the closing bid and asked prices. If the last sale
price is outside the spread, the closing bid or asked price closest to the last
reported sale price is used.
Securities Purchased on a When-Issued Basis -- Delivery and payment for
securities that have been purchased by the Trust on a forward commitment or
when-issued basis can take place a month or more after the transaction date.
During this period, such securities do not earn interest, are subject to market
fluctuation and may increase or decrease in value prior to their delivery. The
Trust maintains, in a segregated account with its custodian, assets with a
market value equal to the amount of its purchase commitments. The purchase of
securities on a when-issued or forward commitment basis may increase the
volatility of the Trust's net asset value to the extent the Trust makes such
purchases while remaining substantially fully invested. As of April 30, 1996,
the Trust had entered into outstanding when-issued or forward commitments of
$2,541,250.
In connection with its ability to purchase securities on a when-issued or
forward commitment basis, the Trust may enter into mortgage 'dollar-rolls' in
which the Trust sells securities for delivery in the current month and
simultaneously contracts with the same counterparty to repurchase similar (same
type coupon and maturity) but not identical securities on a specified future
date. The Trust records each dollar-roll as a sale and a new purchase
transaction.
Security Credit Risk. -- The Fund invests in high yield securities, which may
be subject to
18
<PAGE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
Oppenheimer Multi-Government Trust
a greater degree of credit risk, greater market fluctuations and risk of loss of
income and principal, and may be more sensitive to economic conditions than
lower yielding, higher rated fixed income securities. The Fund may acquire
securities in default, and is not obligated to dispose of securities whose
issuers subsequently default. At April 30, 1996, securities with an aggregate
market value of $107,323, representing .20% of the Fund's net assets, were in
default.
Foreign Currency Translation -- The accounting records of the Trust are
maintained in U.S. dollars. Prices of securities denominated in foreign
currencies are translated into U.S. dollars at the closing rates of exchange.
Amounts related to the purchase and sale of securities and investment income are
translated at the rates of exchange prevailing on the respective dates of such
transactions. The effect of changes in foreign currency exchange rates on
investments is separately identified from the fluctuations arising from changes
in market values of securities held and reported with all other foreign currency
gains and losses in the Trust's Statement of Operations.
Repurchase Agreements -- The Trust requires the custodian to take possession,
to have legally segregated in the Federal Reserve Book Entry System or to have
segregated within the custodian's vault, all securities held as collateral for
repurchase agreements. The market value of the underlying securities is required
to be at least 102% of the resale price at the time of purchase. If the seller
of the agreement defaults and the value of the collateral declines, or if the
seller enters an insolvency proceeding, realization of the value of the
collateral by the Trust may be delayed or limited.
Federal Taxes -- The Trust intends to continue to comply with provisions of
the Internal Revenue Code applicable to regulated investment companies and to
distribute all of its taxable income, including any net realized gain on
investments not offset by loss carryovers, to shareholders. Therefore, no
federal income or excise tax provision is required.
Trustees' Fees and Expenses -- The Trust has adopted a nonfunded retirement
plan for the Trust's independent trustees. Benefits are based on years of
service and fees paid to each trustee during the years of service. During the
six months ended April 30, 1996, a provision of $7,777 was made for the Trust's
projected benefit obligations and payments of $1,214 were made to retired
trustees, resulting in an accumulated liability of $33,997 at April 30, 1996.
Distributions to Shareholders -- The Trust intends to declare and pay
dividends from net investment income monthly. Distributions from net realized
gains on investments, if any, will be made at least once each year.
Classification of Distributions to Shareholders -- Net investment income
(loss) and net realized gain (loss) may differ for financial statement and tax
purposes primarily because of paydown gains and losses and the recognition of
certain foreign currency gains (losses) as ordinary income (loss) for tax
purposes. The character of the distributions made during the year from net
investment income or net realized gains may differ from their ultimate
characterization for federal income tax purposes. Also, due to timing of
dividend distributions, the fiscal year in which amounts are distributed may
differ from the year that the income or realized gain (loss) was recorded by the
Trust.
Other -- Investment transactions are accounted for on the date the investments
are purchased or sold (trade date) and dividend
19
<PAGE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
Oppenheimer Multi-Government Trust
income is recorded on the ex-dividend date. Discount on securities purchased is
amortized over the life of the respective securities, in accordance with federal
income tax requirements. Realized gains and losses on investments and unrealized
appreciation and depreciation are determined on an identified cost basis, which
is the same basis used for federal income tax purposes. Dividends in kind are
recognized as income on the ex-dividend date, at the current market value of the
underlying security. Interest on payment-in-kind debt instruments is accrued as
income at the coupon rate and a market adjustment is made periodically.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of income and expenses during the reporting period. Actual
results could differ from those estimates.
2. SHARES OF BENEFICIAL INTEREST
The Trust has authorized an unlimited number of $.01 par value shares of
beneficial interest. There were no transactions in shares of beneficial interest
for the six months ended April 30, 1996 and the year ended October 31, 1995.
3. UNREALIZED GAINS AND LOSSES ON INVESTMENTS
At April 30, 1996 net unrealized appreciation on investments and options written
of $648,746 was composed of gross appreciation of $1,400,055, and gross
depreciation of $751,309.
4. MANAGEMENT AND ADMINISTRATIVE FEES AND OTHER TRANSACTIONS WITH AFFILIATES
Management fees paid to the Manager were in accordance with the investment
advisory agreement with the Trust which provides for an annual fee of 0.65% on
the Trust's average annual net assets.
Mitchell Hutchins Asset Management Inc. serves as the Trust's Administrator. The
Trust pays the Administrator an annual fee of 0.20% of the Trust's average
annual net assets.
The Manager acts as the accounting agent for the Trust at an annual fee of
$18,000, plus out-of-pocket costs and expenses reasonably incurred.
Shareholder Financial Services, Inc. (SFSI), a wholly-owned subsidiary of the
Manager, is the transfer agent and registrar for the Trust. Fees paid to SFSI
are based on the number of accounts and the number of shareholder transactions,
plus out-of-pocket costs and expenses.
5. FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
A forward foreign currency exchange contract (forward contract) is a commitment
to purchase or sell a foreign currency at a future date, at a negotiated rate.
The Trust uses forward contracts to seek to manage foreign currency risks. They
may also be used to tactically shift portfolio currency risk. The Trust
generally enters into forward contracts as a hedge upon the purchase or sale of
a security denominated in a foreign currency. In addition, the Trust may enter
into such contracts as a hedge against changes in foreign currency exchange
rates on portfolio positions.
Forward contracts are valued based on the closing prices of the forward currency
contract rates in the London foreign exchange markets on a daily basis as
provided by a reliable bank
20
<PAGE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
Oppenheimer Multi-Government Trust
or dealer. The Trust will realize a gain or loss upon the closing or settlement
of the forward transaction.
Securities held in segregated accounts to cover net exposure on outstanding
forward contracts are noted in the Statement of Investments where applicable.
Unrealized appreciation or depreciation on forward contracts is reported in the
Statement of Assets and Liabilities. Realized gains and losses are reported with
all other foreign currency gains and losses in the Trust's Statement of
Operations.
Risks include the potential inability of the counterparty to meet the terms of
the contract and unanticipated movements in the value of a foreign currency
relative to the U.S. dollar.
At April 30, 1996, outstanding forward contracts to purchase and sell currencies
were as follows:
<TABLE>
<CAPTION>
Contract
Amount Valuation as of Unrealized Unrealized
Contracts to Sell Expiration Date (000s) April 30, 1996 Appreciation Depreciation
- - -------------------------------------- --------------- -------- --------------------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Swiss Francs (CHF).................... 7/18/96 545 CHF $ 441,072 $ 6,644 $ --
Danish Kroner (DKK)................... 5/1/96 1,748 DKK 295,599 1,119 --
Japanese Yen (JPY).................... 2/18/96 50,175 JPY 492,271 26,978 --
New Zealand Dollars (NZD)............. 5/1/96 -- NZD 218 -- 1
---------- ------------ ------
$ 1,229,160 34,741 1
---------- ------------ ------
----------
<CAPTION>
Contracts to Purchase
- - --------------------------------------
<S> <C> <C> <C> <C> <C>
Finnish Markka (FIM).................. 5/2/96 1,447 FIM $ 298,290 $ -- $1,069
New Zealand Dollars (NZD)............. 12/18/96 818 NZD 548,803 29,555 --
---------- ------------ ------
$ 847,093 29,555 1,069
---------- ------------ ------
----------
$ 64,296 $1,070
------------ ------
------------ ------
</TABLE>
6. FUTURES CONTRACTS
The Trust may buy and sell interest rate futures contracts in order to gain
exposure to or protect against changes in interest rates. The Trust may also buy
or write put or call options on these futures contracts.
The Trust generally sells futures contracts to hedge against increases in
interest rates and the resulting negative effect on the value of fixed rate
portfolio securities. The Trust may also purchase futures contracts to gain
exposure to changes in interest rates as it may be more efficient or cost
effective than actually buying fixed income securities.
Upon entering into a futures contract, the Trust is required to deposit either
cash or securities in an amount (initial margin) equal to a certain percentage
of the contract value. Subsequent payments (variation margin) are made or
received by the Trust each day. The variation margin payments are equal to the
daily changes in the contract value and are recorded as unrealized gains and
losses. The Trust recognizes a realized gain or loss when the contract is closed
or expired.
Securities held in collateralized accounts to cover initial margin requirements
on open futures contracts are noted in the Statement of Investments. The
Statement of Assets and Lia-
21
<PAGE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
Oppenheimer Multi-Government Trust
bilities reflects a receivable or payable for the daily mark to market for
variation margin.
Risks of entering into futures contracts (and related options) include the
possibility that there may be an illiquid market and that a change in the value
of the contract or option may not correlate with changes in the value of the
underlying securities.
At April 30, 1996, the Fund had outstanding futures contracts to sell debt
securities as follows:
<TABLE>
<CAPTION>
Valuation
Number as of
Expiration of April 30, Unrealized
Contract to Sell Date Contracts 1996 Depreciation
- - ---------------- ---------- --------- ---------- ------------
<S> <C> <C> <C> <C>
U.S. Treasury
Nts......... 6/96 25 $2,687,500 $ 31,250
</TABLE>
7. OPTION ACTIVITY
The Trust may buy and sell put and call options, or write covered put and call
options on portfolio securities in order to produce incremental earnings or
protect against changes in the value of portfolio securities.
The Trust generally purchases put options or writes covered call options to
hedge against adverse movements in the value of portfolio holdings. When an
option is written, the Trust receives a premium and becomes obligated to sell or
purchase the underlying security at a fixed price, upon exercise of the option.
Options are valued daily based upon the last sale price on the principal
exchange on which the option is traded and unrealized appreciation or
depreciation is recorded. The Trust will realize a gain or loss upon the
expiration or closing of the option transaction. When an option is exercised,
the proceeds on sales for a written call option, the purchase cost for a written
put option, or the cost of the security for a purchased put or call option is
adjusted by the amount of premium received or paid.
Securities designated to cover outstanding call options are noted in the
Statement of Investments where applicable. Shares subject to call, expiration
date, exercise price, premium received and market value are detailed in a
footnote to the Statement of Investments. Options written are reported as a
liability in the Statement of Assets and Liabilities. Gains and losses are
reported in the Statement of Operations.
The risk in writing a call option is that the Trust gives up the opportunity for
profit if the market price of the security increases and the option is
exercised. The risk in writing a put option is that the Trust may incur a loss
if the market price of the security decreases and the option is exercised. The
risk in buying an option is that the Trust pays a premium whether or not the
option is exercised. The Trust also has the additional risk of not being able to
enter into a closing transaction if a liquid secondary market does not exist.
Written option activity for the six months ended April 30, 1996 was as follows:
<TABLE>
<CAPTION>
Call Options
-----------------------
Number of Amount of
Options Premiums
---------- ---------
<S> <C> <C>
Options outstanding at
October 31, 1995........... 2,837 $ 35,528
Options written.............. 3,370,817 73,413
Options closed or expired.... (2,184,627) (85,783)
---------- --------
Options outstanding at
April 30, 1996............. 1,189,027 $ 23,158
---------- --------
---------- --------
</TABLE>
8. ILLIQUID AND RESTRICTED SECURITIES
At April 30, 1996, investments in securities included issues that are illiquid
or restricted. The securities are often purchased in private placement
transactions, are not registered under the Securities Act of 1933, may have
contractual restrictions on resale, and are valued under methods approved by the
Board of
22
<PAGE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
Oppenheimer Multi-Government Trust
Trustees as reflecting fair value. The Trust intends to invest no more than 10%
of its net assets (determined at the time of purchase) in illiquid or restricted
securities. The aggregate value of these securities subject to this limitation
at April 30, 1996 was $3,564,732 which represents 6.71% of the Trust's net
assets. Information concerning these securities is as follows:
<TABLE>
<CAPTION>
Valuation
Per Unit
Cost as of
Acquisition Per April 30,
Security Date Unit 1996
- - ------------------------------------------------------------------------- --------- --------- ---------
<S> <C> <C> <C>
Algeria (Republic of) Reprofiled Debt Loan Participation, Tranche A,
6.812%, 9/4/06......................................................... 3/13/96- $ 55.00 $ 56.50
3/21/96
Banco Hipotecario Nacional (Argentina) Medium-Term Nts., 10.625%,
3/29/99................................................................ 3/22/96 $ 99.95 $ 100.50
Canadian Imperial Bank, 10% CD British Pound Sterling Maximum Rate Linked
Nts., 11/8/96.......................................................... 4/28/95 $ 100.00 $ 102.09
Celcaribe SA, 0%/13.50% Sr. Sec. Nts., 3/15/04........................... 11/2/95 $ 67.50 $ 81.00
Colombia (Republic of) Concorde Loan Participation, 6.188%, 1/31/98...... 12/5/95 $ 99.00 $ 98.50
IntelCom Group, Inc. Wts., Exp. 9/05..................................... 8/3/95 $ -- $ 12.00
Jamaica (Government of) 1990 Refinancing Agreement Nts., Tranche A,
6.344%, 10/16/00....................................................... 7/12/95- $ 88.68 $ 94.00
8/15/95
Morgan Stanley Capital I, Inc., Commercial Mtg. Pass-Through
Certificates, Series 1996-C1, Cl. E, 7.51%, 2/1/28..................... 4/25/96 $ 78.60 $ 78.47
Pulsar Internacional SA de CV, 11.80% Nts., 9/19/96...................... 9/14/95 $ 100.00 $ 100.50
Terex Corp. Rts., Exp. 7/96.............................................. 6/29/94 $ 1.49 $ 0.05
Time Warner, Inc., 10.25% Cum., Series K, Exchangeable Preferred Stock... 4/3/96 $1,000.00 $1,000.00
Tribasa Toll Road Trust, 10.50% Nts., Series 1993-A, 12/1/11............. 11/8/93 $ 100.00 $ 75.50
Trinidad & Tobago Loan Participation Agreement, Tranche A, 1.772%,
9/30/00................................................................ 12/13/95- $ 84.94 $ 86.00
12/18/95
United Mexican States:
Linked Nts............................................................. 11/30/95 $ 100.00 $ 114.38
Combined Facility 3, Loan Participation Agreement, Tranche A, 6.50%,
9/20/97.............................................................. 10/25/94 $ 89.00 $ 82.50
</TABLE>
23
<PAGE>
<PAGE>
GENERAL INFORMATION CONCERNING THE TRUST
Oppenheimer Multi-Government Trust (the Trust) is a closed-end diversified
management investment company with a primary investment objective of seeking
high current income consistent with preservation of capital. The Trust's
secondary investment objective is capital appreciation. In seeking its
objectives, as a matter of fundamental policy, the Trust will invest at least
65% of its total assets in debt instruments issued or guaranteed by the U.S.
Government, its agencies or instrumentalities or by foreign governments, their
political subdivisions, agencies or instrumentalities, including supranational
entities. The investment advisor to the Trust is OppenheimerFunds, Inc. (the
Manager). At a meeting held February 22, 1996, the Board of Trustees approved
and recommended, subject to shareholder approval, replacing this fundamental
policy with certain non-fundamental policies. If shareholders approve this
proposal at a meeting originally scheduled for May 21, 1996 (adjourned to June
28, 1996), this fundamental policy would be removed, and the Trust would make
the following investment policy changes: (1) adopt a non-fundamental policy that
the Trust shall invest at least 65% of its total assets in bonds (defined, for
purposes of this non-fundamental investment policy, to be debt securities), (2)
remove the non-fundamental investment policy that the Fund shall invest at least
30% of its total assets in U.S. government securities. The Trust has also
undertaken to invest at least 50% of its assets in foreign debt securities.
The Trust may also invest in certain other securities, including fixed-income
securities of domestic and foreign corporations certain of which could be
high-yield, 'lower-grade' debt instruments, and participation interests, and
may invest in a number of different kinds of 'derivative investments.' The
Trust may engage in certain special investment techniques, including repurchase
transactions, when-issued and delayed delivery transactions and hedging.
Portfolio Managers of the Trust are Thomas P. Reedy, David A. Rosenberg and
Ashwin K. Vasan, who also serve as Vice Presidents of the Trust and of the
Manager, and are officers of certain mutual funds managed by the Manager
(OppenheimerFunds). Messrs. Reedy, Rosenberg and Vasan have been the persons
principally responsible for the day-to-day management of the Trust's portfolio
since August 1993, June 1994 and August 1993, respectively. During the past five
years, Mr. Reedy served as a securities analyst for the Manager, and, prior to
joining the Manager, Mr. Rosenberg served as an officer and portfolio manager
for Delaware Investment Advisors and one of its mutual funds and Mr. Vasan
served as a securities analyst for Citibank, N.A.
Dividend Reinvestment and Cash Purchase Plan -- Pursuant to the Trust's
Dividend Reinvestment and Cash Purchase Plan (the Plan), as to shares of the
Trust (Shares) not registered in nominee name, all dividends and capital gains
distributions (Distributions) declared by the Trust will be automatically
reinvested in additional full and fractional Shares unless a shareholder elects
to receive cash. If Shares are registered in nominee name, the shareholder
should consult the nominee if the shareholder desires to participate in the
Plan. Shareholders that participate in the Plan (Participants) may, at their
option, make additional cash investments in Shares, semi-annually in amounts of
at least $100, through payment to Shareholder Financial Services, Inc., the
agent for the Plan (the Agent), accompanied by a service fee of $0.75.
Depending upon the circumstances hereinafter described, Plan Shares will be
acquired by the Agent for the Participant's account through receipt of newly
issued Shares or the purchase of outstanding Shares on the open market. If
24
<PAGE>
<PAGE>
the market price of Shares on the relevant date (normally the payment date)
equals or exceeds their net asset value, the Agent will ask the Trust for
payment of the Distribution in additional Shares at the greater of the Trust's
net asset value determined as of the date of purchase or 95% of the then-current
market price. If the market price is lower than net asset value, the
Distribution will be paid in cash, which the Agent will use to buy Shares on The
New York Stock Exchange (the NYSE), or otherwise on the open market to the
extent available. If the market price exceeds the net asset value before the
Agent has completed its purchases, the average purchase price per Share paid by
the Agent may exceed the net asset value, resulting in fewer Shares being
acquired than if the Distribution had been paid in Shares issued by the Trust.
Participants may elect to withdraw from the Plan at any time and thereby receive
cash in lieu of Shares by sending appropriate written instructions to the Agent.
Elections received by the Agent will be effective only if received more than ten
days prior to the record date for any Distribution; otherwise, such termination
will be effective shortly after the investment of such Distribution with respect
to any subsequent Distribution. Upon withdrawal from or termination of the Plan,
all Shares acquired under the Plan will remain in the Participant's account
unless otherwise requested. For full Shares, the Participant may either: (1)
receive without charge a share certificate for such Shares; or (2) request the
Agent (after receipt by the Agent of signature guaranteed instructions by all
registered owners) to sell the Shares acquired under the Plan and remit the
proceeds less any brokerage commissions and a $2.50 service fee. Fractional
Shares may either remain in the Participant's account or be reduced to cash by
the Agent at the Oppenheimer Multi-Government Trust current market price with
the proceeds remitted to the Participant.
Shareholders who have previously withdrawn from the Plan may rejoin at any time
by sending written instructions signed by all registered owners to the Agent.
There is no direct charge for participation in the Plan; all fees of the Agent
are paid by the Trust. There are no brokerage charges for Shares issued directly
by the Trust. However, each Participant will pay a pro rata share of brokerage
commissions incurred with respect to open market purchases of Shares to be
issued under the Plan. Participants will receive tax information annually for
their personal records and to assist in federal income tax return preparation.
The automatic reinvestment of Distributions does not relieve Participants of any
income tax that may be payable to Distributions.
The Plan may be terminated or amended at any time upon 30 days' prior written
notice to Participants which, with respect to a Plan termination, must precede
the record date of any Distribution by the Trust. Additional information
concerning the Plan may be obtained by shareholders holding Shares registered
directly in their names by writing the Agent, Shareholder Financial Services,
Inc., P.O. Box 173673, Denver, CO 80217-3673 or by calling 1-800-647-7374.
Shareholders holding Shares in nominee name should contact their brokerage firm
or other nominee for more information.
Shareholder Information -- The Shares are traded on the NYSE. Daily market
prices for the Trust's shares are published in the New York Stock Exchange
Composite Transaction section of newspapers under the designation 'OppenGvt.'
The Trust's NYSE trading symbol is OGT. Weekly net asset value (NAV) and market
price information about the Trust is published each Monday in The Wall Street
Journal, each Sunday in The New York Times and each Saturday in Barron's, and
other newspapers in a table called 'Closed-End Bond Funds.'
25
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<PAGE>
<PAGE>
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<PAGE>
<PAGE>
OPPENHEIMER MULTI-GOVERNMENT TRUST
Officers And Trustees
Leon Levy, Chairman of the Board of Trustees
Donald W. Spiro, Vice Chairman of the
Board of Trustees
Bridget A. Macaskill, Trustee and President
Robert G. Galli, Trustee
Benjamin Lipstein, Trustee
Elizabeth B. Moynihan, Trustee
Kenneth A. Randall, Trustee
Edward V. Regan, Trustee
Russell S. Reynolds, Jr., Trustee
Sidney M. Robbins, Trustee
Pauline Trigere, Trustee
Clayton K. Yeutter, Trustee
Thomas P. Reedy, Vice President
David A. Rosenberg, Vice President
Ashwin K. Vasan, Vice President
George C. Bowen, Treasurer
Robert J. Bishop, Assistant Treasurer
Scott T. Farrar, Assistant Treasurer
Andrew J. Donohue, Secretary
Robert G. Zack, Assistant Secretary
Investment Advisor
OppenheimerFunds, Inc.
Administrator
Mitchell Hutchins Asset Management Inc.
Transfer Agent and Registrar
Shareholder Financial Services, Inc.
Custodian of Portfolio Securities
The Bank of New York
Independent Auditors
KPMG Peat Marwick LLP
Legal Counsel
Gordon Altman Butowsky Weitzen
Shalov & Wein
The financial statements included herein have been taken from the records of the
Trust without examination by the independent auditors.
This is a copy of a report to shareholders of Oppenheimer Multi-Government
Trust. It does not offer for sale or solicit orders to buy any securities.
Notice is hereby given in accordance with Section 23(c) of the Investment
Company Act of 1940 that periodically the Trust may purchase its shares of
beneficial interest in the open market at prevailing market prices.
Shares of Oppenheimer funds are not deposits or obligations of any bank, are not
guaranteed by any bank, and are not insured by the FDIC or any other agency,
and involve investment risks, including possible loss of the principal amount
invested.
RS0675.001.0496 [Logo] Printed on recycled paper
1996 SEMIANNUAL REPORT
----------------------------------------------------------------------------
OPPENHEIMER
MULTI-GOVERNMENT
TRUST
APRIL 30, 1996
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