MERRILL LYNCH
SENIOR FLOATING
RATE FUND, INC.
FUND LOGO
Quarterly Report
May 31, 1995
<PAGE>
Officers and Directors
Arthur Zeikel, President and Director
Ronald W. Forbes, Director
Cynthia A. Montgomery, Director
Charles C. Reilly, Director
Kevin A. Ryan, Director
Richard R. West, Director
Terry K. Glenn, Executive Vice President
N. John Hewitt, Senior Vice President
Donald C. Burke, Vice President
John W. Fraser, Vice President
R. Douglas Henderson, Vice President
Gerald M. Richard, Treasurer
Patrick D. Sweeney, Secretary
Custodian
The Bank of New York
90 Washington Street
New York, NY 10286
Transfer Agent
Merrill Lynch Financial Data Services, Inc.
4800 Deer Lake Drive East
Jacksonville, FL 32246-6484
(800) 637-3863
This report, including the financial information herein, is
transmitted to the shareholders of Merrill Lynch Senior Floating
Rate Fund, Inc. for their information. It is not a prospectus,
circular or representation intended for use in the purchase of
shares of the Fund or any securities mentioned in this report. Past
performance results shown in this report should not be considered a
representation of future performance.
Merrill Lynch
Senior Floating
Rate Fund, Inc.
Box 9011
Princeton, NJ
08543-9011
<PAGE>
Merrill Lynch Senior Floating Rate Fund, Inc.
DEAR SHAREHOLDER
The three-month period ended May 31, 1995 was characterized by
increasing signs of an economic slowdown that led to higher US stock
and bond prices. With unemployment at a seven-month high, consumer
spending down and factory orders for big-ticket items, such as cars
and appliances, off more than 4.0% in April, investors believe that
inflation will not be a problem. Treasury bonds are trading at
levels that reflect a widespread view that the Federal Reserve
Board's next move will be to lower the target Federal Funds rate for
the first time in over a year.
This uncertain interest rate environment has put negative pressure
on US short-term interest rates, and to a lesser extent, on the
yield of Merrill Lynch Senior Floating Rate Fund, Inc. Over 98% of
the Fund's floating rate investments are currently accruing interest
at a spread above the London Interbank Offered Rate (LIBOR), the
rate that major international banks charge each other for US dollar-
denominated deposits outside the United States. LIBOR has
historically tracked very closely with other US short-term interest
rates, particularly the Federal Funds rate. Since the first
tightening of monetary policy by the Federal Reserve Board over one
year ago, the Federal Funds rate has climbed from 3.0% to 6.0%. Over
that same period, three-month LIBOR has risen from 3.25% to a high
of over 6.25% in late February, and then by May 31, 1995 had dropped
to just over 6.0%. Since the average LIBOR reset on the Fund's
investments is 52 days, the yield will typically reflect any
sustained decrease or increase in short-term interest rates within a
one-month--two-month period.
Portfolio Performance
The Fund finished the May 31, 1995 quarter with approximately
91.35%, or $1.54 billion, of its $1.69 billion in net assets
committed for investment in loan interests. Assets not invested in
loan interests were invested in high-quality short-term securities.
Net of trades not yet closed, the Fund had $1.44 billion, or 85.4%
of its net assets, closed and invested in corporate loan interests.
<PAGE>
The Fund's effective yield for the May quarter was 8.02% versus
7.71% during the previous quarter. The downward trend in short-term
interest rates during the three-month period, in conjunction with
the steady inflow of cash from new subscriptions, was offset by an
increase in fee income. The Fund's net asset value remained
relatively stable throughout the period. During the May 31, 1995
quarter, the Fund earned $0.202 per share income dividends,
representing a net annualized yield of 8.02% on an average per share
net asset value of $10.01. The Fund's total investment return was
2.20%, based on a stable net asset value and reinvestment of $0.199
per share income dividends. Since inception (November 3, 1989)
through May 31, 1995, the Fund's total investment return was 47.62%,
based on a change in per share net asset value from $10.00 to
$10.01, and assuming reinvestment of $3.878 per share income
dividends.
Investment Activities
We purchased over $437.5 million in loan interests during the May
31, 1995 quarter. This increase included $246.1 million in 15 new
transactions and $191.4 million of secondary purchases. Our
investment strategy remains unchanged: to focus on leveraged
transactions in which the borrowers have strong market shares in
their respective industries, experienced management, and consistent
cashflows. We also look for companies with significant underlying
asset and franchise value, strong capital structures and equity
sponsors with proven track records. We continue to seek those
investments that offer the appropriate risk/reward balance in the
form of their floating rate spread over LIBOR or the prime rate.
These strategies are reflected in new investments made during the
May quarter. These additions include Paging Network, the largest
provider of paging services in the United States, and Westinghouse
Air Brake Company, North America's largest manufacturer of air
brakes and related equipment for railway cars and locomotives. We
continue to broaden the Fund's diversification into non-cyclical
industries such as K-III Communications, Dominick's Finer Foods and
National Medical Enterprises. We made additional investments in
existing portfolio names such as Thrifty Payless, Jefferson Smurfit
Company/Container Corp. of America, and Playtex Family Products Inc.
These purchases were offset by the sale of portions of the Fund's
larger portfolio positions. These partial sales included Jefferson
Smurfit Company/Container Corp. of America, S.D. Warren Co., Berg
Electronics Inc. and Northwest Airlines, Inc. In addition, the
Fund's investments in Allison Engine Co., Petrolane, Inc., Circle K
Acquisitions Corp., and Lexmark Holdings prepaid in their entirety.
<PAGE>
The advantage of adhering to the above-mentioned investment
strategies is reflected by both the relative stability of the Fund's
net asset value and the continued flexibility of our borrowers to
access the capital markets and position themselves for any economic
downturn.
The quarter ended May 31, 1995 saw a relatively light volume of
large new transactions announced in the leveraged loan market. The
most attractive new transactions were oversubscribed and allocations
were the rule rather than the exception as new investors continued
to come into the bank loan market. Liquidity in the leveraged bank
loan market is the strongest it has ever been, and as new players
enter the market, both on the investor and trading side, this trend
should continue. We continue to be opportunistic in purchasing
higher-quality lower-yielding leveraged loans in an effort to invest
our cash reserves.
At May quarter-end, the Fund was comprised of 72 different borrowers
representing 28 different industries. The average loan size was $20
million, or 1.19% of net assets. The largest industry concentrations
were in paper, 18.9% of net assets; retail specialty, 9.43%; food
and beverage, 6.95%; broadcast/media, 5.44%; and diversified
manufacturing, 4.26%.
The Fund completed another quarterly tender offer on April 1, 1995,
with approximately 3.1 million shares tendered and accepted for
repurchase. The latest tender began on June 20, 1995 and concludes
on July 18, 1995. The Fund remains open for new shareholder
purchases.
Investment Outlook
Default rates over the last year were at historical lows and credit
fundamentals remain far superior to those generated by leveraged
deals done in the late 1980s. Strong investor demand for senior
secured loan products should keep the secondary market tight with
the majority of the focus on the primary syndications. We expect
this to result in continued strong liquidity and compressed yield
spreads. We believe these trends are likely to continue as long as
the public debt and equity markets remain attractive and investors
aggressively bid the market. In light of the current uncertainty
created by various economic indicators about the direction of the US
economy, the Fund is positioned to benefit from a rise in short-term
interest rates if the economy begins to pick up speed again later
this year.
In Conclusion
We thank you for your continued investment in Merrill Lynch Senior
Floating Rate Fund, Inc., and we look forward to reviewing our
outlook and strategy with you again in our next report to
shareholders.
<PAGE>
Sincerely,
(Arthur Zeikel)
Arthur Zeikel
President
(R. Douglas Henderson)
R. Douglas Henderson
Vice President and Portfolio Manager
June 23, 1995
<TABLE>
SCHEDULE OF INVESTMENTS (in Thousands)
<CAPTION>
Face
Industry Senior Secured Floating Rate Loan Interests* Amount Value
<S> <S> <C> <C>
Aerospace--2.44% Aviall Inc., Term Loan B, due 11/30/00:
10.00% to 6/07/95 $ 15,287 $ 15,287
9.75% to 9/07/95 5,338 5,338
Gulfstream Aerospace Corp., Term Loan, due 3/31/97, 10.00% to 6/30/95 612 612
Gulfstream Aerospace Corp., Term Loan, due 3/31/98:
9.63% to 6/08/95 9,260 9,260
8.88% to 7/13/95 10,761 10,761
---------- ----------
41,258 41,258
Airlines--0.78% Northwest Airlines, Inc., Term Loan, due 6/15/97, 8.5625% to 4/20/95 13,240 13,240
<PAGE>
Analytical Elsag Bailey, Term Loan, due 8/30/02, 8.4375% to 6/26/95 13,913 13,913
Instruments--1.57% Waters Corp., Term Loan B, due 8/31/01:
9.4375% to 6/30/95 141 141
9.6875% to 6/30/95 5,474 5,474
Waters Corp., Term Loan C, due 8/31/02:
9.8125% to 6/30/95 141 141
10.0625% to 6/30/95 3,789 3,789
Waters Corp., Term Loan D, due 2/28/03:
10.1875% to 6/30/95 198 198
10.4375% to 6/30/95 2,960 2,960
---------- ----------
26,616 26,616
Automobile Exide Corporation, Term Loan B, due 9/30/01, 9.00% to 6/30/95 4,950 4,950
Parts--0.29%
Broadcast Classic Cable, Term Loan A, due 3/31/03, 10.75% to 6/30/95 2,500 2,500
/Media--5.44% Classic Cable, Term Loan B, due 3/31/04, 8.88% to 7/26/95 5,000 5,000
Coaxial Communications, Term Loan, due 12/31/99:
9.38% to 6/15/95 4,433 4,433
10.19% to 6/15/95 9,500 9,500
9.50% to 7/17/95 5,035 5,035
Ellis Communications, Term Loan B, due 3/31/03, 9.3125% to 6/15/95 5,000 5,000
Enquirer/Star, Term Loan B, due 9/30/02:
10.50%(1) 134 134
8.63% to 8/22/95 26,532 26,532
Journal News Inc., Term Loan, due 12/31/01, 8.19% to 7/28/95 10,000 10,000
Silver King Communications, Term Loan B, due 7/31/02,
9.1875% to 7/31/95 17,865 17,865
US Radio Inc., Term Loan A, due 12/31/01:
9.1875% to 7/28/95 1,298 1,298
9.4375% to 9/29/95 1,298 1,298
US Radio Inc., Term Loan B, due 9/23/03:
10.1875% to 7/28/95 1,708 1,708
10.4375% to 9/29/95 1,695 1,695
---------- ----------
91,998 91,998
Building MTF Acquisition, Term Loan B, due 12/31/02:
Products--3.20% 10.00%(1) 15,000 15,000
10.00% to 7/05/95 5,000 5,000
Overhead Door Corp., Revolving Credit Loan, due 8/18/99:
8.5625% to 6/05/95 273 273
8.5625% to 6/26/95 615 615
8.8125% to 6/30/95 1,705 1,705
Overhead Door Corp., Term Loan, due 8/18/99, 8.8125% to 6/30/95 9,046 9,046
RSI Home Products, Term Loan, due 11/30/99, 8.5625% to 8/31/95 9,500 9,500
U.S.G. Corp., Term Loan, due 12/31/00:
8.125% to 7/10/95 9,803 9,803
7.9375% to 7/17/95 3,161 3,161
---------- ----------
54,103 54,103
</TABLE>
<PAGE>
<TABLE>
SCHEDULE OF INVESTMENTS (continued) (in Thousands)
<CAPTION>
Face
Industry Senior Secured Floating Rate Loan Interests* Amount Value
<S> <S> <C> <C>
Carbon & Graphite UCAR International, Term Loan B, due 1/31/03, 9.1875% to 8/08/95 $ 7,325 $ 7,325
Products--0.89% UCAR International, Term Loan C, due 7/31/03, 9.6875% to 8/08/95 3,834 3,834
UCAR International, Term Loan D, due 1/31/04, 10.0625% to 11/08/95 3,834 3,834
---------- ----------
14,993 14,993
Chemicals--2.80% Freedom Chemical Company, Term Loan B, due 6/30/02, 9.4375% to 7/27/95 27,000 27,000
Harris Specialty Chemicals, Term Loan A, due 12/30/99:
9.00% to 6/16/95 631 631
9.00% to 6/28/95 2,299 2,299
Harris Specialty Chemicals, Term Loan B, due 12/30/01:
9.50% to 6/16/95 2,881 2,881
9.50% to 6/28/95 4,932 4,932
Hydrochem, Term Loan R, due 7/01/02, 10.625% to 10/31/95 5,000 5,000
Inspec Technologies, Term Loan B, due 12/02/00, 6.6875% to 6/30/95 4,607 4,607
---------- ----------
47,350 47,350
Consumer CHF/Ebel USA, Term Loan B, due 9/30/01, 9.4375% to 7/28/95 10,032 10,032
Products--3.50% Playtex Family Products Inc., Revolving Credit Loan, due 12/01/00:
10.50% to 6/01/95 3,596 3,596
8.57% to 6/14/95 1,892 1,892
Playtex Family Products Inc., Term Loan A, due 12/01/00, 8.57% to 6/14/95 8,904 8,904
Playtex Family Products Inc., Term Loan B, due 6/01/01, 9.07% to 6/14/95 19,667 19,667
Revlon Consumer Products, Term Loan B, due 6/30/97, 9.8125% to 6/08/95 15,000 15,000
---------- ----------
59,091 59,091
Containers--2.16% Ivex Packaging Corp., Term Loan B, due 12/31/99:
11.25%(1) 35 35
10.32% to 6/28/95 857 857
10.00% to 8/24/95 2,714 2,714
9.40% to 9/29/95 4,571 4,571
9.57% to 11/30/95 1,429 1,429
Portola Packaging, Inc., Term Loan B, due 7/01/01, 9.8125% to 6/08/95 7,250 7,250
Silgan Corp., Term Loan B, due 9/15/96:
9.3125% to 6/08/95 9,536 9,536
10.00% to 6/09/95 10,038 10,038
11.25% to 6/30/95 14 14
---------- ----------
36,444 36,444
<PAGE>
Diversified Desa International Inc., Term Loan B, due 11/30/00, 10.0625% to 6/27/95 9,032 9,032
Manufacturing InterMetro Industries, Term Loan B, due 6/30/01, 10.00% to 7/03/95 9,825 9,825
- --4.26% InterMetro Industries, Term Loan C, due 12/31/02, 10.50% to 7/03/95 14,295 14,295
The Pullman Co., Inc., Revolving Credit Loan, due 9/30/96:
10.50%(1) 853 853
9.8125% to 6/23/95 3,915 3,915
The Pullman Co., Inc., Term Loan A, due 9/30/96, 9.8125% to 6/23/95 9,359 9,359
The Pullman Co., Inc., Term Loan B, due 9/30/96, 10.3125% to 6/23/95 650 650
Thermadyne Company, Term Loan B, due 2/01/01:
9.0625% to 6/05/95 24,000 24,000
10.75% to 6/30/95 98 98
---------- ----------
72,027 72,027
Drug Stores--2.96% Duane Reade Co., Term Loan A, due 9/30/97, 9.0625% to 8/31/95 7,711 7,711
Duane Reade Co., Term Loan B, due 9/30/99, 9.5625% to 8/31/95 10,000 10,000
Eckerd Corp., Term Loan, Series C, due 7/31/00:
7.3125% to 6/09/95 5,278 5,278
7.5625% to 11/09/95 5,933 5,933
Thrifty Payless, Term Loan B, due 9/30/01, 9.3875% to 6/22/95 21,040 21,040
---------- ----------
49,962 49,962
</TABLE>
<TABLE>
SCHEDULE OF INVESTMENTS (continued) (in Thousands)
<CAPTION>
Face
Industry Senior Secured Floating Rate Loan Interests* Amount Value
<S> <S> <C> <C>
Electrical Berg Electronics Inc., Term Loan A, due 3/31/00:
Instruments 8.82% to 6/26/95 $ 368 $ 368
- --1.53% 10.50% to 6/30/95 13 13
8.88% to 8/25/95 11,224 11,224
Berg Electronics Inc., Term Loan B, due 6/30/01:
9.07% to 6/26/95 4 4
9.375% to 8/25/95 967 967
Tracor Inc., Term Loan A, due 10/31/98, 8.5625% to 6/22/95 3,303 3,303
Tracor Inc., Term Loan B, due 2/28/01:
9.0625% to 6/22/95 9,889 9,889
11.00% to 6/30/95 61 61
---------- ----------
25,829 25,829
<PAGE>
Fertilizer--1.18% Terra Industries, Term Loan B, due 10/20/01, 8.75% to 7/20/95 19,875 19,875
Food & American Italian Pasta, Term Loan C, due 12/31/00, 9.375% to 11/17/95 5,000 5,000
Beverage--6.95% Amerifoods, Term Loan B, due 6/30/01, 9.25% to 7/11/95 7,500 7,500
Amerifoods, Term Loan C, due 6/30/02, 9.75% to 7/11/95 7,500 7,500
Domino's Pizza, Inc., Term Loan B, due 7/27/00:
9.75% to 6/06/95 3,000 3,000
9.6875% to 8/07/95 3,000 3,000
9.4375% to 9/06/95 5,591 5,591
9.3125% to 11/08/95 2,087 2,087
Heileman Acquisition Company, Term Loan B, due 12/31/00,
9.6875% to 10/13/95 10,000 10,000
Kraft Foods, Term Loan B, due 3/31/02:
9.32% to 8/21/95 10,000 10,000
9.57% to 8/21/95 15,000 15,000
MAFCO Worldwide, Term Loan B, due 6/30/01, 9.32% to 6/30/95 10,000 10,000
President Baking Co., Inc., Term Loan B, due 9/30/00, 8.8125% to
6/30/95 4,966 4,966
Specialty Foods Corp., Term Loan B3, due 8/31/99:
9.13% to 7/18/95 13,673 13,673
10.00% to 7/18/95 15,150 15,150
Specialty Foods Corp., Term Loan B5, due 8/31/99, 11.00%(1) 5,000 5,000
---------- ----------
117,467 117,467
Grocery--2.98% Big V Supermarkets Inc., Term Loan B, due 3/15/00:
8.938% to 7/17/95 5,200 5,200
9.313% to 9/20/95 5,200 5,200
Dominick's Finer Foods, Term Loan B, due 3/31/02:
9.375% to 6/05/95 4,342 4,342
11.00% to 6/05/95 6 6
Dominick's Finer Foods, Term Loan C, due 3/31/03:
9.875% to 6/05/95 4,658 4,658
11.50% to 6/05/95 53 53
Dominick's Finer Foods, Term Loan D, due 9/30/03:
10.125% to 6/05/95 4,658 4,658
11.75% to 6/05/95 53 53
Pathmark Stores Inc., Term Loan, due 10/31/99, 9.125% to 8/30/95 4,950 4,950
Ralph's Grocery Company, Term Loan, due 6/30/98:
9.00% to 6/30/95 461 461
9.0625% to 6/30/95 518 518
9.00% to 7/10/95 12,808 12,808
Star Markets Co., Inc., Term Loan B, due 12/31/01, 9.1875% to
6/19/95 4,211 4,211
Star Markets Co., Inc., Term Loan C, due 12/31/02, 9.6875% to
6/19/95 3,158 3,158
---------- ----------
50,276 50,276
</TABLE>
<PAGE>
<TABLE>
SCHEDULE OF INVESTMENTS (continued) (in Thousands)
<CAPTION>
Face
Industry Senior Secured Floating Rate Loan Interests* Amount Value
<S> <S> <C> <C>
Health National Medical Enterprises, Term Loan, due 8/31/01:
Services--1.77% 7.50% to 6/01/95 $ 7,500 $ 7,500
7.3125% to 6/05/95 7,500 7,500
7.375% to 7/05/95 7,500 7,500
7.6875% to 9/01/95 7,500 7,500
---------- ----------
30,000 30,000
Leasing & Rental Prime Acquisition, Term Loan, due 12/31/00:
Services--0.89% 9.25% to 6/05/95 4,800 4,800
9.3125% to 7/05/95 5,400 5,400
9.1875% to 7/08/95 4,800 4,800
---------- ----------
15,000 15,000
Medical Deknatel Holdings Corp., Term Loan A, due 4/20/99:
Devices--0.57% 9.125% to 6/30/95 115 115
9.3125% to 9/29/95 115 115
9.3125 to 10/25/95 1,938 1,938
Deknatel Holdings Corp., Term Loan B, due 4/20/01, 10.0625% to 6/27/95 7,500 7,500
---------- ----------
9,668 9,668
Nautical Systems-- Sperry Marine, Inc., Term Loan, due 11/15/00:
0.52% 10.0625% to 6/23/95 4,947 4,947
9.50% to 6/30/95 131 131
9.6875% to 9/29/95 3,639 3,639
---------- ----------
8,717 8,717
<PAGE>
Paper--18.97% Fort Howard Corp., Term Loan B, due 12/31/02, 9.07% to 6/19/95 59,208 59,208
Jefferson Smurfit Company/Container Corp. of America, Term Loan A,
due 4/30/01:
8.5625% to 5/30/95 9,774 9,774
8.8125% to 5/30/95 22,271 22,271
8.5625% to 6/19/95 8,011 8,011
10.50% to 6/30/95 2,819 2,819
8.9375% to 9/28/95 19,112 19,112
8.9375% to 9/29/95 2,289 2,289
8.6250% to 9/30/95 5,722 5,722
Jefferson Smurfit Company/Container Corp. of America, Term Loan B,
due 4/30/02:
9.0625 to 6/23/95 19,788 19,788
9.4375% to 9/25/95 2,968 2,968
9.375% to 10/24/95 54,086 54,086
Mail Well, Term Loan B, due 12/31/00, 9.375% to 6/02/95 4,958 4,958
Mail Well, Term Loan C, due 12/31/01, 9.375% to 6/02/95 5,000 5,000
S.D. Warren Co., Term Loan B, due 12/19/02, 9.50% to 8/23/95 52,000 52,000
Stone Container, Term Loan B, due 4/01/00:
9.3125% to 6/14/95 27,232 27,232
9.25% to 7/17/95 25,307 25,307
---------- ----------
320,545 320,545
Printing & K-III Communications, Term Loan, 12/31/00, 8.90% to 8/09/95 6,000 6,000
Publishing--2.69% Print Tech International, Term Loan B, due 12/28/01, 9.0625% to 6/09/95 4,958 4,958
Ziff Davis, Term Loan B, due 12/31/01, 9.4375% to 9/28/95 14,118 14,118
Ziff Davis, Term Loan C, due 12/31/02, 9.4375% to 9/28/95 20,382 20,382
---------- ----------
45,458 45,458
Railroad Westinghouse Air Brake Company, Term Loan, due 2/15/03,
Equipment--0.30% 9.0625% to 6/21/95 5,000 5,000
</TABLE>
<PAGE>
<TABLE>
SCHEDULE OF INVESTMENTS (concluded) (in Thousands)
<CAPTION>
Face
Industry Senior Secured Floating Rate Loan Interests* Amount Value
<S> <S> <C> <C>
Retail-- Federated Department Stores, Term Loan, due 3/31/00:
Specialty--9.43% 7.0625% to 6/05/95 $ 893 $ 893
7.0625% to 6/07/95 714 714
7.0625% to 6/29/95 27,500 27,500
7.8125% to 7/26/95 2,143 2,143
7.4375% to 9/18/95 1,786 1,786
7.4375% to 9/25/95 41,071 41,071
Music Acquisition Corp., Term Loan B, due 8/31/01:
9.25% to 4/19/95 14,063 14,063
9.5625% to 8/17/95 8,156 8,156
Music Acquisition Corp., Term Loan C, due 8/31/02, 10.3125% to 6/20/95 7,500 7,500
QVC, Inc., Term Loan B, due 1/31/04, 9.125% to 7/03/95 28,000 28,000
Saks & Co., Term Loan B, due 6/30/00, 9.25% to 11/09/95 27,469 27,469
---------- ----------
159,295 159,295
Telecommuni- Paging Network, Term Loan B, due 3/31/03, 9.445% to 11/06/95 29,333 29,333
cations--1.74%
Textiles--1.48% Chicopee, Inc., Term Loan B, 3/31/03, 9.32% to 6/26/95 25,000 25,000
Transportation Petro Properties, Term Loan B, due 5/24/01, 9.5625% to 6/30/95 8,907 8,907
Services--0.53%
Warehousing Pierce Leahy Corp., Term Loan B, due 6/30/01:
& Storage--0.89% 9.3125% to 6/30/95 9,545 9,545
9.9375% to 7/31/95 5,455 5,455
---------- ----------
15,000 15,000
Total Senior Secured Floating Rate Loan Interests
(Cost--$1,397,402)--82.71% 1,397,402 1,397,402
<PAGE>
<CAPTION>
Short-Term Securities
<S> <S> <C> <C>
Commercial Ciesco L.P., 5.88% due 6/16/95 25,000 24,811
Paper**--9.96% General Electric Capital Corp., 6.13% due 6/01/95 53,648 53,648
Motorola Inc., 5.94% due 6/05/95 30,000 29,980
PHH Corporation, 5.95% due 6/23/95 20,000 19,927
Preferred Receivables Funding Corp., 5.95% due 6/22/95 25,000 24,913
Raytheon Company, 5.94% due 6/01/95 15,000 15,000
---------- ----------
168,648 168,279
US Government & Federal Home Loan Bank:
Agency 5.88% due 6/16/95 30,000 29,926
Obligations**-- 5.86% due 6/21/95 25,000 24,919
5.61% 5.87% due 6/22/95 20,000 19,932
Federal National Mortgage Association, 5.90% due 6/14/95 20,125 20,082
---------- ----------
95,125 94,859
Total Short-Term Securities (Cost--$263,138)--15.57% 263,773 263,138
<CAPTION>
Common Stock Shares Held
<S> <S> <C> <C>
Restaurants-- Flagstar Companies, Inc. 44 164
0.01%
Total Common Stock (Cost--$0)--0.01% 44 164
Total Investments (Cost--$1,660,540)--98.29% 1,660,704
Other Assets Less Liabilities--1.71% 28,897
----------
Net Assets (Equivalent to $10.01 per share based on 168,734,864
shares outstanding)--100.00% $1,689,601
==========
<FN>
*The interest rates on senior secured floating rate loan interests
are subject to change periodically based on the change in the prime
rate of a US Bank, LIBOR (London Interbank Offered Rate), or, in
some cases, another base lending rate. The interest rates shown are
those in effect at May 31, 1995.
**Commercial Paper and certain US Government & Agency Obligations
are traded on a discount basis; the interest rates shown are the
discount rates paid at the time of purchase by the Fund.
(1)Index is based on the prime rate of a US bank, which is subject
to change daily.
</TABLE>
<PAGE>
