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M.S.D.&T. FUNDS, INC.
(THE "COMPANY")
INSTITUTIONAL SHARES
VALUE EQUITY FUND
INTERNATIONAL EQUITY FUND
INTERMEDIATE FIXED INCOME FUND
MARYLAND TAX-EXEMPT BOND FUND
SUPPLEMENT DATED MARCH 11, 1996
TO THE PROSPECTUS DATED SEPTEMBER 29, 1995
On February 16, 1996, Dunedin Fund Managers, Ltd ("Dunedin"), the current
sub-adviser to the Company's International Equity Fund (the "Fund"), announced
that it was being acquired by Edinburgh Fund Managers Group plc. The
acquisition, which is expected to be completed on or about March 19, 1996,
will result in the automatic termination of Dunedin's sub-advisory agreement
with Mercantile-Safe Deposit & Trust Company ("Mercantile"), the Fund's
adviser, with respect to the Fund.
At a Special Meeting held on March 11, 1996, the Board of Directors of the
Company approved CastleInternational Asset Management Limited
("CastleInternational"), an investment advisory firm based in Scotland and a
wholly-owned subsidiary of PNC Holding Corp., as the new sub-adviser for the
Fund. CastleInternational will begin serving as sub-adviser to the Fund as of
the date of the acquisition of Dunedin. Lorna MacKay, a Senior Investment
Manager at CastleInternational and head of the European Desk, will serve as
portfolio manager of the Fund and as the person primarily responsible for its
day-to-day operations. Prior to joining CastleInternational, Ms. MacKay was an
investment manager on the Continental European Desk at Dunedin.
A Special Meeting of Shareholders of record of the Fund will be called to
vote on a new Sub-Advisory Agreement (the "Agreement") with
CastleInternational, and it is expected that this Meeting will take place on
or about April 25, 1996. CastleInternational will not receive any sub-advisory
fees from the Fund until such time as the Agreement has been approved by
shareholders.
