LETTER TO SHAREHOLDERS
Dear Shareholder:
During 1994, the bond markets have been beaten down by a strengthening
economy, fears of rising inflation, and a weakening U.S. dollar. As a result
of these influences, interest rates have risen much faster this year than
most economists had anticipated. Prices of municipal bonds reached their low
points early in the second quarter, then staged a modest rebound this summer,
before sliding again in recent weeks. As a consequence, tax exempt yields now
have risen to their highest levels in nearly two years. While the upward rate
move in municipals has been significant (approximately 1% for long-term
bonds), it has not been as dramatic as the response in the U.S. Treasury
market, where yields have risen twice as much.
For the year ended September 30, 1994, the General California Municipal
Bond Fund, Inc. suffered a loss in principal of approximately $1.40 per share
(adjusted for capital gain distributions), which amounts to approximately
9.72% of net asset value. Partially offsetting this loss of principal were
income dividends of approximately $.78 per share, which equates to a tax-free
distribution rate per share of 6.01%, based on the Fund's closing net asset
value of $12.90 on September 30, 1994, adjusted for capital gain
distributions. (All income dividends paid were exempt from Federal,
California State and local income taxes.*)
When it became more apparent last summer that the economy was gathering
momentum, we put in place a more defensive investment strategy in order to
reduce the level of volatility of the portfolio. We believe that our actions
to build cash reserves and reduce the Fund's exposure to State-supported
debt, derivatives and long-term bonds were generally successful. In
retrospect, had we anticipated the degree of price correction that the
markets would experience, we might have shortened our maturity and duration
targets even further.
While we continue to be very cautious in our investment strategy, we are
hopeful that the series of Federal Reserve Board moves to tighten interest
rates, begun last February, will start to translate into more favorable
economic news for the markets. One factor working to their advantage is the
municipal market's favorable technical position (i.e., adequate retail demand
for tax exempt securities, combined with a sharp reduction in the supply of
new issuance this year). While we view the municipal market more favorably
today than we have in months, we are wary of the strong influence exerted by
the price of taxable securities. Should a clearer picture emerge, we are
poised to alter our investment strategy accordingly.
The current fiscal situation in California has been described by some
observers as a "crisis." The situation is serious and the attendant political
situation adds an additional element of risk. The sale this summer of over $7
billion of warrants and notes was of unprecedented size, and certainly
underscores the depth of the State's problems. There is reason to believe
that the gaps in the 1995 budget may not be closed through the Governor's
proposed expenditure reductions and new revenues. Should the State have to
turn to the market again in February (if some of the new revenues are not
forthcoming), then the State's credit ratings could be subjected to
additional downgrades. Until the economic picture becomes clearer, we will
continue to limit our holdings of State-supported debt.
The dual economic uncertainties (national and State) recommend that we
continue with a cautious approach. However, as stated above, we are sensing
that the tide could change if the Fed tightens further before year end. In
the event of such a move, we are poised to alter our investment strategy
accordingly.
After enjoying a number of years of strong market performance, it is
unsettling, to say the least, to be faced with such an uncertain environment.
With the benefit of hindsight, many investors might have
opted earlier this year to redeploy their investment holdings into more
defensive securities as a hedge against rising rates. While falling prices
earlier this year reduced the value of the portfolio, the level of tax-free
dividends remains stable. We believe that there are two fundamental reasons
to invest in a municipal bond fund such as this one: tax exempt income and
solid long-term performance. Focusing too intently on short-term results can
be detrimental. For this reason, we continue to direct our management efforts
towards providing a high degree of tax exempt income each year and to deliver
strong long-term performance results. We trust that our philosophy is in
concert with yours.
Very truly yours,
(Richard J. Moynihan Signature Logo)
Richard J. Moynihan
Director, Municipal Portfolio Management
The Dreyfus Corporation
October 13, 1994
New York, N.Y.
* Some income may be subject to the Federal Alternative Minimum Tax
(AMT) for certain shareholders. Capital gains, if any, are generally
subject to Federal, State and local taxes.
PERFORMANCE
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN GENERAL CALIFORNIA
MUNICIPAL BOND FUND, INC. AND THE LEHMAN BROTHERS MUNICIPAL BOND INDEX
(Exhibit A)
$14,685
Lehman Brothers
Municipal Bond Index*
$14,418
General California
Municipal Bond Fund
* Source: Lehman Brothers
<TABLE>
AVERAGE ANNUAL TOTAL RETURNS
ONE YEAR ENDED FROM INCEPTION (10/10/89)
SEPTEMBER 30, 1994 TO SEPTEMBER 30, 1994
---------------------- ----------------------------
<S> <C> <C>
(4.43%) 7.63%
</TABLE>
Past performance is not predictive of future performance.
The above graph compares a $10,000 investment made in the General California
Municipal Bond Fund on 10/10/89 (Inception Date) to a $10,000 investment made
in the Lehman Brothers Municipal Bond Index on that date. For comparative
purposes the value of the Index on 9/30/89 is used as the beginning value on
10/10/89. All dividends and capital gain distributions are reinvested.
The Fund invests primarily in California municipal securities and its
performance takes into account fees and expenses. Unlike the Fund, the Lehman
Brothers Municipal Bond Index is an unmanaged total return performance
benchmark for the long-term, investment-grade tax exempt bond market,
calculated by using municipal bonds selected to be representative of the
market. The index does not take into account charges, fees and other
expenses. Further information relating to Fund performance, including expense
reimbursements, if applicable, is contained in the Condensed Financial
Information section of the Prospectus and elsewhere in this report.
<TABLE>
<CAPTION>
GENERAL CALIFORNIA MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS SEPTEMBER 30, 1994
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS-99.5% AMOUNT VALUE
-------------- -------------
<S> <C> <C>
CALIFORNIA-92.9%
ABAG Finance Corp., COP (ABAG XXIV) 6.90%, 4/1/2012......................... $ 3,500,000 $ 3,530,135
Alameda Housing Authority, MFHR (Independence Apartments Projects)
7.50%, 2/20/2031 (Collateralized; GNMA)................................. 3,595,000 3,760,298
Allan Hancock Joint Community College District, COP, Refunding 7.625%, 10/1/2005 1,055,000 1,118,173
Anaheim Public Financing Authority, Tax Allocation Revenue 9.32%, 12/28/2018 (a) 3,000,000 2,981,250
Beaumont Unified School District, COP (Capital Improvement Project) 7.70%, 1/1/2021 1,100,000 1,129,194
Berkeley, HR (Alta Bates Project) 7.65%, 12/1/2015 (Prerefunded 8/1/2000) (b) 465,000 521,302
California:
6.125%, 10/1/2011....................................................... 8,000,000 7,954,000
5.15%, 10/1/2019........................................................ 4,000,000 3,265,160
California Department of Water Resources, Revenue (Central Valley Project)
8.956%, 12/1/2026 (a,c)................................................. 6,300,000 5,961,375
California Educational Facilities Authority, Revenue:
(Chapman College) 7.50%, 1/1/2018....................................... 1,760,000 1,824,205
(Refunding-Pooled College and University Financings) 6.125%, 6/1/2009... 3,000,000 2,888,820
(University of San Francisco) 6.30%, 10/1/2007.......................... 2,470,000 2,469,975
California Health Facilities Authority, Revenue (Pacific Presbyterian Hospital)
7.60%, 6/1/2015......................................................... 910,000 1,000,800
California Health Facilities Financing Authority, Revenue:
(Childrens' Hospital of Los Angeles) 7.125%, 6/1/2021 (Prerefunded 6/1/2001) (b) 2,000,000 2,246,200
(Help Group) 7%, 8/1/2021
(Insured; California Health Facilities Construction Loan Program)..... 1,800,000 1,827,414
(Pomona Valley Hospital Medical Center) 7.375%, 1/1/2014................ 750,000 791,715
(Refunding - Health Dimensions) 7%,5/1/2020............................. 6,000,000 5,853,240
(Walden House) 6.85%, 3/1/2022.......................................... 3,225,000 3,222,065
California Housing Finance Agency, Home Mortgage Revenue:
Zero Coupon, 8/1/2023................................................... 6,380,000 692,804
7.50%, 8/1/2029......................................................... 1,570,000 1,612,704
7.65%, 8/1/2029......................................................... 900,000 928,764
7.60%, 8/1/2030......................................................... 1,855,000 1,879,226
7.70%, 8/1/2030......................................................... 1,540,000 1,578,654
California Pollution Control Financing Authority:
PCR (Southern California Edison Co.) 6.40%, 12/1/2024................... 5,000,000 4,793,700
SWDR (North County Recycling Center) 6.75%, 7/1/2011
(LOC; Union Bank of Switzerland) (d).................................. 3,500,000 3,526,810
California Public Works Board, LR:
(Department of Correction - Madera State Prison) 6%, 6/1/2010........... 3,000,000 2,916,690
(Department of Correction - Susanville State Prison)
5.375%, 6/1/2018 (Insured; MBIA)...................................... 11,000,000 9,443,060
GENERAL CALIFORNIA MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) SEPTEMBER 30, 1994
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
-------------- -------------
CALIFORNIA (CONTINUED)
California Public Works Board, LR (continued):
(Library and Courts Annex Building) 6%, 5/1/2013........................ $ 4,500,000 $ 4,208,400
(University of California Projects) 5.55%, 6/1/2010..................... 3,195,000 2,910,805
California Statewide Communities Development Authority, COP, Revenue,
Refunding:
Health Facilities (Barton Memorial Hospital)
6.50%, 12/1/2009 (LOC; Banque Nationale de Paris) (d)................. 1,600,000 1,600,976
(Triad Healthcare):
6.25%, 8/1/2006....................................................... 4,570,000 4,363,345
6.50%, 8/1/2022....................................................... 3,000,000 2,785,770
California Statewide Communities Development Corp., COP (Pacific Homes)
5.90%, 4/1/2009......................................................... 7,000,000 6,865,670
Campbell, COP, Refunding (Civic Center Project) 6.90%, 10/1/2018
(Prerefunded 10/1/2001) (b)............................................. 3,760,000 4,186,008
Chico Public Finance Authority, Revenue
(Chico Municipal Airport and Central Chico Redevelopment Project) 7.40%, 4/1/2021 2,410,000 2,481,505
Commerce Joint Powers Financing Authority, Revenue, Multiple Project Loans
8%, 3/1/2022............................................................ 2,495,000 2,645,748
Compton, COP, Refunding 7.50%, 8/1/2005 (LOC; Mitsui Trust and Banking) (d). 2,680,000 2,798,161
Dry Creek Joint School District, Special Tax
(Community Facilities District Number 1) 7.25%, 9/1/2011................ 2,500,000 2,536,850
East Bay Municipal Utility District, Water Systems Revenue
7.60%, 6/1/2020 (Insured; MBIA, Prerefunded 6/1/2000) (b)............... 3,000,000 3,411,600
Folsom Public Financing Authority, Local Agency Revenue 7.70%, 10/1/2020.... 1,200,000 1,237,980
Fontana Public Financing Authority, Tax Allocation Revenue
(North Fontana Redevelopment Project) 7.25%, 9/1/2020................... 2,000,000 2,053,820
Fontana Redevelopment Agency, Multi-Family Housing Mortgage Revenue,
Refunding
(Village Drive Apartments) 7.15%, 5/1/2028.............................. 3,070,000 3,164,464
Fresno, Health Facility Revenue
(Holy Cross Health Systems-Saint Agnes Medical Center) 6.625%, 6/1/2021. 2,000,000 1,952,120
Fresno Unified School District, COP (Project Phase VI) 7.20%, 5/1/2011...... 4,250,000 4,381,070
Glendora Public Finance Authority, Tax Allocation Revenue 7.625%, 9/1/1999
(Prerefunded 6/1/1999) (b).............................................. 1,145,000 1,289,774
Hollister Redevelopment Agency, Tax Allocation
(Hollister Community Development Project) 7.55%, 10/1/2013.............. 1,000,000 1,044,670
Inglewood, HR (Daniel Freeman Hospital) 6.75%, 5/1/2013..................... 2,000,000 2,022,440
Irvine Ranch Water District, Joint Powers Agency, Local Pool Revenue
8.25%, 8/15/2023........................................................ 3,000,000 3,157,680
La Mirada Redevelopment Agency (Tax Allocation-Industrial Commercial
Redevelopment)
6.80%, 8/15/2021........................................................ 3,950,000 3,915,161
GENERAL CALIFORNIA MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) SEPTEMBER 30, 1994
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
-------------- -------------
CALIFORNIA (CONTINUED)
Lake Elsinore Public Financing Authority, Local Agency Revenue 8%, 10/1/2020 $ 3,390,000 $ 3,443,020
Los Alamitos Union Free School District, Special Tax
(Community Facilities District Number 1) 7.15%, 8/15/2021............... 2,000,000 2,003,000
Los Angeles, Wastewater Systems Revenue:
6.70%, 12/1/2021 (Insured; MBIA, Prerefunded 12/1/2000) (b)............. 3,750,000 4,120,875
Refunding 7.10%, 6/1/2018............................................... 6,980,000 7,298,707
Los Angeles Building Authority, LR, Refunding
(Department of General Services):
5.375%, 5/1/2006...................................................... 4,060,000 3,843,561
5.60%, 5/1/2008....................................................... 8,000,000 7,535,040
Los Angeles County Metropolitan Transportation Authority, Sales Tax Revenue,
Refunding 5.50%, 7/1/2013............................................... 3,250,000 2,893,833
Los Angeles Department of Water and Power:
Electric Pilot Revenue:
4.75%, 10/15/2020..................................................... 4,700,000 3,587,228
7.10%, 1/15/2031...................................................... 2,750,000 3,038,695
Waterworks Revenue 7.625%, 8/1/2027..................................... 2,000,000 2,200,400
Mountain View, Shoreline Regional Park Community, Tax Allocation 5.75%, 8/1/2018 5,000,000 4,432,450
Newhall Elementary and Castaic Union School District, COP
(School Improvement Project) 7.70%, 3/1/2011............................ 2,695,000 2,784,420
Northern California Power Agency, Public Power Revenue, Refunding:
(Geothermal Project Number 3) 5.80%, 7/1/2009........................... 5,500,000 5,237,650
(Hydroelectric Project Number 1):
9.045%, 7/1/2018 (Insured; MBIA) (a,c)................................ 13,200,000 12,870,000
7.15%, 7/1/2024....................................................... 5,410,000 5,576,303
Orange County:
Airport Revenue, Refunding (John Wayne Airport) 5.50%, 7/1/2013 (Insured; MBIA) 1,750,000 1,553,038
COP 7.625%, 6/1/2019 (Prerefunded 6/1/1999) (b)......................... 2,500,000 2,814,375
Special Tax (Community Facilities District Number 87) 7.80%, 8/15/2015
(Prerefunded 8/15/2000) (b)........................................... 1,500,000 1,726,380
Otay Municipal Water District (Improvement District Number 27) 6.70%, 9/1/2022 2,000,000 1,947,840
Palm Dessert (Assessment District Number 94-1) 7.625%, 9/2/2019............. 3,305,000 3,326,185
Port Oakland, Special Facility Revenue (Mitsui O.S.K. Lines Limited)
6.80%, 1/1/2019 (LOC; Industrial Bank of Japan) (d)..................... 3,000,000 2,999,550
Richmond Joint Powers Financing Authority, Revenue 7.25%, 5/15/2013......... 2,000,000 2,031,060
Sacramento County, Special Tax (Community Facilities District Number 1)
8.25%, 12/1/2020........................................................ 5,610,000 5,963,093
Sacramento Municipal Utility District, Electric Revenue
9.224%, 8/15/2018 (Insured; FGIC) (a)................................... 4,000,000 3,870,000
GENERAL CALIFORNIA MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) SEPTEMBER 30, 1994
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
-------------- -------------
CALIFORNIA (CONTINUED)
Sacramento Schools Insurance Authority, Revenue (Workers Compensation
Program)
5.75%, 6/1/2003......................................................... $ 6,935,000 $ 6,898,661
San Bernardino, Health Care Systems Revenue (Sisters of Charity) 7%, 7/1/2021 2,000,000 2,061,640
San Bernardino County, Central School District 7.05%, 5/1/2016.............. 1,825,000 2,000,675
San Marcos Public Facilities Authority, Revenue, Refunding
(Public Improvement-Civic Center) 6.15%, 8/1/2013....................... 4,500,000 4,201,470
Simi Valley, Single Family Residential Mortgage Revenue 7.625%, 8/1/2022 (e) 3,000,000 1,650,000
Southern California Home Finance Authority, SFMR:
7.625%, 10/1/2023 (Collateralized; GNMA)................................ 1,100,000 1,129,865
6.90%, 10/1/2024 (Collateralized: FNMA and GNMA)........................ 2,000,000 1,996,920
Southern California Public Power Authority, Power Project Revenue:
(Multiple Projects) 6.75%, 7/1/2011..................................... 3,750,000 3,875,362
(Refunding - Mead Adelanto Project) 5%, 7/1/2017 (Insured; AMBAC)....... 5,000,000 4,089,300
Stanislaus Waste-to-Energy Financing Agency,
Solid Waste Facility Revenue Certificates, Refunding
(Ogden Martin Systems, Inc. Project) 7.625%, 1/1/2010................... 3,000,000 3,142,800
Tehachapi Unified School District, COP (Tompkins Elementary School Project)
7.80%, 2/1/2021 (Prerefunded 2/1/2001) (b).............................. 1,000,000 1,142,040
Torrance, HR (Little Co. of Mary Hospital) 7.10%, 12/1/2015
(Prerefunded 12/1/2005) (b)............................................. 930,000 981,848
University of California, COP:
Revenue, Refunding (Multiple Purpose Projects) 5%, 9/1/2023............. 6,000,000 4,767,540
(UCLA Central Chiller/Cogeneration) 7%, 11/1/2018 (Prerefunded 11/1/1999) (b) 3,400,000 3,747,888
Upland, HR, COP (San Antonio Community Hospital) 7.125%, 1/1/2011........... 745,000 768,594
Vista, MFHR, Refunding (Vista Hacienda Project) 6.95%, 4/1/2017............. 3,000,000 3,063,030
Waterford Public Financing Authority, Revenue 8.20%, 9/15/2020.............. 3,700,000 3,778,440
Watsonville Mammouth Lakes, COP 7.875%, 6/1/2011............................ 1,770,000 1,897,086
West Basin Municipal Water District, COP (Water Reclamation Project)
6.85%, 8/1/2016 (Insured; AMBAC, Prerefunded 8/1/2000) (b).............. 2,000,000 2,200,120
Yolo County Housing Authority, Mortgage Revenue (Walnut Park Apartments)
7.20%, 8/1/2033 (Insured; FHA).......................................... 4,150,000 4,174,194
U. S. RELATED-6.6%
Puerto Rico Electric Power Authority, Power Revenue:
7.125%, Series N, 7/1/1999.............................................. 960,000 1,060,781
7.125%, Series O, 7/1/1999.............................................. 1,590,000 1,757,713
7.125%, Series N, 7/1/2014.............................................. 540,000 576,153
7.125%, Series O, 7/1/2014.............................................. 910,000 975,629
7%, 7/1/2021............................................................ 4,000,000 4,155,680
Virgin Islands Port Authority, Airport Revenue (Cyril E. King Airport
Project)
8.10%, 10/1/2005........................................................ 4,135,000 4,545,606
GENERAL CALIFORNIA MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) SEPTEMBER 30, 1994
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
-------------- -------------
U. S. RELATED (CONTINUED)
Virgin Islands Territory (Hugo Insurance Claims Funds Program) 7.75%, 10/1/2006 $ 1,845,000 $ 1,994,334
Virgin Islands Water and Power Authority, Electric Systems Revenue 7.40%, 7/1/2011 6,000,000 6,183,420
--------------
TOTAL LONG-TERM MUNICIPAL INVESTMENTS(cost $317,928,436).................... $320,645,242
==============
SHORT-TERM MUNICIPAL INVESTMENTS-.5%
CALIFORNIA-.2%
Los Angeles, Multi-Family Revenue, VRDN (Loans To Lender Program) 3.85% (f). $ 700,000 $ 700,000
U. S. RELATED-.3%
Puerto Rico Electric Power Authority, Power Revenue, 3.10% (a).............. 1,000,000 1,000,000
--------------
TOTAL SHORT-TERM MUNICIPAL INVESTMENTS (cost $1,700,000).................... $ 1,700,000
==============
TOTAL INVESTMENTS-100.0%
(cost $319,628,436)..................................................... $322,345,242
==============
</TABLE>
<TABLE>
SUMMARY OF ABBREVIATIONS
<S> <C> <C> <C>
AMBAC American Municipal Bond Assurance Corporation LR Lease Revenue
COP Certificate of Participation MBIA Municipal Bond Investors Assurance
FGIC Financial Guaranty Insurance Company MFHR Multi-Family Housing Revenue
FHA Federal Housing Administration PCR Pollution Control Revenue
FNMA Federal National Mortgage Association SFMR Single Family Mortgage Revenue
GNMA Government National Mortgage Association SWDR Solid Waste Disposal Revenue
HR Hospital Revenue VRDN Variable Rate Demand Notes
LOC Letter of Credit
</TABLE>
<TABLE>
SUMMARY OF COMBINED RATINGS (UNAUDITED)
FITCH (G) OR MOODY'S OR STANDARD & POOR'S PERCENTAGE OF VALUE
- --------- --------- -------------------- -----------------------
<S> <C> <C> <C>
AAA Aaa AAA 23.5%
AA Aa AA 16.4
A A A 34.5
BBB Baa BBB 16.4
D N/A D .5
F1 & F1+ VMIGI, MIG1 & P1 SP1 & A1 .5
Not Rated Not Rated Not Rated 8.2
------
100.0%
======
</TABLE>
NOTES TO STATEMENT OF INVESTMENTS:
(a) Inverse floater security - the interest rate is subject to change
periodically.
(b) Bonds which are prerefunded are collateralized by U.S. Government
securities which are held in escrow and are used to pay principal and
interest on the tax-exempt issue and to retire the bonds in full at the
earliest refunding date.
(c) Security exempt from registration under Rule 144A of the Securities
Act of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At September
30, 1994, these securities amounted to $18,831,375 or 5.4% of net assets.
(d) Secured by letters of credit.
(e) Non-income producing security; interest payment in default.
(f) Securities payable on demand. The interest rate, which is subject to
change, is based upon bank prime rates or an index of market interest
rates.
(g) Fitch currently provides creditworthiness information for a limited
number of investments.
See notes to financial statements.
<TABLE>
GENERAL CALIFORNIA MUNICIPAL BOND FUND, INC.
STATEMENT OF ASSETS AND LIABILITIES SEPTEMBER 30, 1994
<S> <C> <C>
ASSETS:
Investments in securities, at value
(cost $319,628,436)-see statement..................................... $322,345,242
Cash.................................................................... 3,516,900
Receivable for investment securities sold............................... 18,768,022
Interest receivable..................................................... 6,407,019
Prepaid expenses........................................................ 6,831
--------------
351,044,014
LIABILITIES:
Due to The Dreyfus Corporation.......................................... $ 175,963
Payable for investment securities purchased............................. 3,696,967
Accrued expenses and other liabilities.................................. 107,610 3,980,540
------------ --------------
NET ASSETS ................................................................ $347,063,474
==============
REPRESENTED BY:
Paid-in capital......................................................... $342,248,480
Accumulated undistributed net realized gain on investments.............. 2,098,188
Accumulated net unrealized appreciation on investments-Note 3(b)........ 2,716,806
--------------
NET ASSETS at value applicable to 26,907,697 shares outstanding
(500 million shares of $.001 par value Common Stock authorized)......... $347,063,474
==============
NET ASSET VALUE, offering and redemption price per share
($347,063,474 / 26,907,697 shares)...................................... $12.90
=======
See notes to financial statements.
</TABLE>
<TABLE>
GENERAL CALIFORNIA MUNICIPAL BOND FUND, INC.
STATEMENT OF OPERATIONS YEAR ENDED SEPTEMBER 30, 1994
<S> <C> <C>
INVESTMENT INCOME:
INTEREST INCOME......................................................... $ 25,396,853
EXPENSES:
Management fee-Note 2(a).............................................. $2,351,917
Shareholder servicing costs-Note 2(b)................................. 400,339
Custodian fees........................................................ 62,342
Professional fees..................................................... 49,662
Directors' fees and expenses-Note 2(c)................................ 22,635
Prospectus and shareholders' reports.................................. 20,152
Registration fees..................................................... 14,129
Miscellaneous......................................................... 48,433
------------
TOTAL EXPENSES.................................................... 2,969,609
--------------
INVESTMENT INCOME-NET............................................. 22,427,244
--------------
REALIZED AND UNREALIZED (LOSS) ON INVESTMENTS:
Net realized gain on investments-Note 3(a).............................. $2,409,198
Net realized (loss) on financial futures-Note 3(a)...................... (300,236)
------------
NET REALIZED GAIN..................................................... 2,108,962
Net unrealized (depreciation) on investments............................ (43,545,566)
--------------
NET REALIZED AND UNREALIZED (LOSS) ON INVESTMENTS................. (41,436,604)
--------------
NET (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS...................... $ (19,009,360)
==============
See notes to financial statements.
</TABLE>
<TABLE>
GENERAL CALIFORNIA MUNICIPAL BOND FUND, INC.
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED SEPTEMBER 30,
---------------------------------
1993 1994
-------------- ---------------
<S> <C> <C>
OPERATIONS:
Investment income-net................................................... $ 24,692,309 $ 22,427,244
Net realized gain on investments........................................ 2,427,493 2,108,962
Net unrealized appreciation (depreciation) on investments for the year.. 32,104,152 (43,545,566)
-------------- ---------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS....... 59,223,954 (19,009,360)
-------------- ---------------
DIVIDENDS TO SHAREHOLDERS FROM:
Investment income-net................................................... (24,692,309) (22,427,244)
Net realized gain on investments........................................ (2,306,090) (1,957,211)
-------------- ---------------
TOTAL DIVIDENDS....................................................... (26,998,399) (24,384,455)
-------------- ---------------
CAPITAL STOCK TRANSACTIONS:
Net proceeds from shares sold........................................... 238,178,901 143,167,610
Dividends reinvested.................................................... 19,599,176 17,051,843
Cost of shares redeemed................................................. (207,773,095) (226,190,833)
-------------- ---------------
INCREASE (DECREASE) IN NET ASSETS FROM CAPITAL STOCK TRANSACTIONS..... 50,004,982 (65,971,380)
-------------- ---------------
TOTAL INCREASE (DECREASE) IN NET ASSETS........................... 82,230,537 (109,365,195)
NET ASSETS:
Beginning of year....................................................... 374,198,132 456,428,669
-------------- ---------------
End of year............................................................. $ 456,428,669 $ 347,063,474
============== ===============
SHARES SHARES
-------------- ---------------
CAPITAL SHARE TRANSACTIONS:
Shares sold............................................................. 17,486,285 10,562,987
Shares issued for dividends reinvested.................................. 1,435,772 1,251,353
Shares redeemed......................................................... (15,218,045) (16,686,997)
-------------- ---------------
NET INCREASE (DECREASE) IN SHARES OUTSTANDING......................... 3,704,012 (4,872,657)
============== ===============
See notes to financial statements.
</TABLE>
<TABLE>
GENERAL CALIFORNIA MUNICIPAL BOND FUND, INC.
FINANCIAL HIGHLIGHTS
Contained below is per share operating performance data for a share of Common Stock outstanding, total investment return,
ratios to average net assets and other supplemental data for each year
indicated. This information has been derived from the Fund's financial statements.
YEAR ENDED SEPTEMBER 30,
---------------------------------------------------
PER SHARE DATA: 1990(1) 1991 1992 1993 1994
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year........... $12.50 $12.43 $12.89 $13.33 $14.36
------- ------- ------- ------- -------
INVESTMENT OPERATIONS:
Investment income-net........................ .90 .90 .85 .82 .78
Net realized and unrealized gain (loss) on investments (.08) .47 .44 1.11 (1.40)
------- ------- ------- ------- -------
TOTAL FROM INVESTMENT OPERATIONS........... .82 1.37 1.29 1.93 (.62)
------- ------- ------- ------- -------
DISTRIBUTIONS:
Dividends from investment income-net......... (.89) (.91) (.85) (.82) (.78)
Dividends from net realized gain on investments -- -- -- (.08) (.06)
------- ------- ------- ------- -------
TOTAL DISTRIBUTIONS........................ (.89) (.91) (.85) (.90) (.84)
------- ------- ------- ------- -------
Net asset value, end of year................. $12.43 $12.89 $13.33 $14.36 $12.90
======= ======= ======= ======= =======
TOTAL INVESTMENT RETURN 6.93%(2) 11.35% 10.31% 15.04% (4.43%)
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets...... -- .21% .37% .64% .76%
Ratio of net investment income to average net assets 7.35%(2) 7.06% 6.47% 5.96% 5.72%
Decrease reflected in the above expense ratios due to
undertakings by the Manager................ 1.05%(2) .62% .39% .11% --
Portfolio Turnover Rate...................... 9.94%(3) 2.81% 23.97% 30.20% 29.74%
Net Assets, end of year (000's Omitted)...... $98,427 $271,656 $374,198 $456,429 $347,063
- ----------------------------
(1) From October 10, 1989 (commencement of operations) to September 30, 1990.
(2) Annualized.
(3) Not annualized.
See notes to financial statements.
</TABLE>
GENERAL CALIFORNIA MUNICIPAL BOND FUND, INC.
NOTES TO FINANCIAL STATEMENTS
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES:
The Fund is registered under the Investment Company Act of 1940 ("Act")
as a non-diversified open-end management investment company. Dreyfus Service
Corporation, until August 24, 1994, acted as the exclusive distributor of the
Fund's shares, which are sold to the public without a sales charge. Dreyfus
Service Corporation is a wholly-owned subsidiary of The Dreyfus Corporation
("Manager"). Effective August 24, 1994, the Manager became a direct
subsidiary of Mellon Bank, N.A.
On August 24, 1994, Premier Mutual Fund Services, Inc. (the
"Distributor") was engaged as the Fund's distributor. The Distributor,
located at One Exchange Place, Boston, Massachusetts 02109, is a wholly-owned
subsidiary of Institutional Administration Services, Inc., a provider of
mutual fund administration services, the parent company of which is Boston
Institutional Group, Inc.
(A) PORTFOLIO VALUATION: The Fund's investments (excluding options and
financial futures on municipal and U.S. treasury securities) are valued each
business day by an independent pricing service ("Service") approved by the
Board of Directors. Investments for which quoted bid prices are readily
available and are representative of the bid side of the market in the
judgment of the Service are valued at the mean between the quoted bid prices
(as obtained by the Service from dealers in such securities) and asked prices
(as calculated by the Service based upon its evaluation of the market for
such securities). Other investments (which constitute a majority of the
portfolio securities) are carried at fair value as determined by the Service,
based on methods which include consideration of: yields or prices of
municipal securities of comparable quality, coupon, maturity and type;
indications as to values from dealers; and general market conditions. Options
and financial futures on municipal and U.S. treasury securities are valued at
the last sales price on the securities exchange on which such securities are
primarily traded or at the last sales price on the national securities market
on each business day. Investments not listed on an exchange or the national
securities market, or securities for which there were no transactions, are
valued at the average of the most recent bid and asked prices. Bid price is
used when no asked price is available.
(B) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities
transactions are recorded on a trade date basis. Realized gain and loss from
securities transactions are recorded on the identified cost basis. Interest
income, adjusted for amortization of premiums and original issue discounts on
investments, is earned from settlement date and recognized on the accrual
basis. Securities purchased or sold on a when-issued or delayed-delivery
basis may be settled a month or more after the trade date.
The Fund follows an investment policy of investing primarily in municipal
obligations of one state. Economic changes affecting the state and certain of
its public bodies and municipalities may affect the ability of issuers within
the state to pay interest on, or repay principal of, municipal obligations
held by the Fund.
(C) DIVIDENDS TO SHAREHOLDERS: It is the policy of the Fund to declare
dividends daily from investment income-net. Such dividends are paid monthly.
Dividends from net realized capital gain are normally declared and paid
annually, but the Fund may make distributions on a more frequent basis to
comply with the distribution requirements of the Internal Revenue Code. To
the extent that net realized capital gain can be offset by capital loss
carryovers, if any, it is the policy of the Fund not to distribute such gain.
(D) FEDERAL INCOME TAXES: It is the policy of the Fund to continue to
qualify as a regulated investment company, which can distribute tax exempt
dividends, by complying with the applicable provisions of the Internal
Revenue Code, and to make distributions of income and net realized capital
gain sufficient to relieve it from substantially all Federal income and
excise taxes.
GENERAL CALIFORNIA MUNICIPAL BOND FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE 2-MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES:
(A) Pursuant to a management agreement ("Agreement") with the Manager,
the management fee is computed at the annual rate of .60 of 1% of the average
daily value of the Fund's net assets and is payable monthly. The Agreement
provides for an expense reimbursement from the Manager should the Fund's
aggregate expenses, exclusive of taxes, brokerage, interest on borrowings and
extraordinary expenses, exceed the expense limitation of any state having
jurisdiction over the Fund. The most stringent state expense limitation
applicable to the Fund presently requires reimbursement of expenses in any
full fiscal year that such expenses (exclusive of certain expenses as
described above) exceed 2 1/2% of the first $30 million, 2% of the next $70
million and 1 1/2% of the excess over $100 million of the average value of
the Fund's net assets in accordance with California "blue sky" regulations.
There was no expense reimbursement for the year ended September 30, 1994.
(B) Pursuant to the Fund's Shareholder Services Plan, the Fund reimburses
Dreyfus Service Corporation an amount not to exceed an annual rate of .25 of
1% of the value of the Fund's average daily net assets for servicing
shareholder accounts. The services provided may include personal services
relating to shareholder accounts, such as answering shareholder inquiries
regarding the Fund and providing reports and other information, and services
related to the maintenance of shareholder accounts. During the year ended
September 30, 1994, the Fund was charged an aggregate of $173,410 pursuant to
the Shareholder Services Plan.
(C) Prior to August 24, 1994 certain officers and directors of the Fund
were "affiliated persons," as defined in the Act, of the Manager and/or
Dreyfus Service Corporation. Each director who is not an "affiliated person"
receives an annual fee of $2,500 and an attendance fee of $250 per meeting.
NOTE 3-SECURITIES TRANSACTIONS:
(A) The aggregate amount of purchases and sales of investment securities
amounted to $210,196,883 and $296,749,476, respectively, for the year ended
September 30, 1994, and consisted entirely of long-term and short-term
municipal investments.
The Fund is engaged in trading financial futures contracts. The Fund is
exposed to market risk as a result of changes in the value of the underlying
financial instruments. Investments in financial futures require the Fund to
"mark to market" on a daily basis, which reflects the change in the market
value of the contract at the close of each day's trading. Accordingly,
variation margin payments are made or received to reflect daily unrealized
gains or losses. When the contracts are closed, the Fund recognizes a
realized gain or loss. These investments require initial margin deposits with
a custodian, which consist of cash or cash equivalents, up to approximately
10% of the contract amount. The amount of these deposits is determined by the
exchange or Board of Trade on which the contract is traded and is subject to
change. At September 30, 1994, there were no financial futures contracts
outstanding.
(B) At September 30, 1994, accumulated net unrealized appreciation on
investments was $2,716,806, consisting of $8,754,999 gross unrealized
appreciation and $6,038,193 gross unrealized depreciation.
At September 30, 1994, the cost of investments for Federal income tax
purposes was substantially the same as the cost for financial reporting
purposes (see the Statement of Investments).
GENERAL CALIFORNIA MUNICIPAL BOND FUND, INC.
REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
SHAREHOLDERS AND BOARD OF DIRECTORS
GENERAL CALIFORNIA MUNICIPAL BOND FUND, INC.
We have audited the accompanying statement of assets and liabilities of
General California Municipal Bond Fund, Inc., including the statement of
investments, as of September 30, 1994, and the related statement of
operations for the year then ended, the statement of changes in net assets
for each of the two years in the period then ended, and financial highlights
for each of the years indicated therein. These financial statements and
financial highlights are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. Our procedures included confirmation of
securities owned as of September 30, 1994 by correspondence with the custodian
and brokers. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audits provide
a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the financial
position of General California Municipal Bond Fund, Inc. at September 30,
1994, the results of its operations for the year then ended, the changes in
its net assets for each of the two years in the period then ended, and the
financial highlights for each of the indicated years, in conformity with
generally accepted accounting principles.
(Ernst & Young Signature Logo)
New York, New York
November 3, 1994
IMPORTANT TAX INFORMATION (UNAUDITED)
In accordance with Federal tax law, the Fund hereby makes the following
designations regarding its fiscal year ended September 30, 1994:
- all the dividends paid from investment income-net are
"exempt-interest dividends" (not subject to regular Federal and, for
individuals who are California residents, California personal income
taxes), and
- the portion of the $.0636 per share paid by the Fund on
December 9, 1993 representing a long-term capital gain
distribution is $.0366 per share.
As required by Federal tax law rules, shareholders will receive
notification of their portion of the Fund's taxable ordinary dividends (if
any) and capital gain distributions (if any) paid for the 1994 calendar year
on Form 1099-DIV which will be mailed by January 31, 1995.
(Dreyfus Lion 'D' Logo)
GENERAL CALIFORNIA
MUNICIPAL BOND FUND, INC.
144 Glenn Curtiss Boulevard
Uniondale, NY 11556
MANAGER
The Dreyfus Corporation
200 Park Avenue
New York, NY 10166
CUSTODIAN
The Bank of New York
90 Washington Street
New York, NY 10286
TRANSFER AGENT &
DIVIDEND DISBURSING AGENT
The Shareholder Services Group, Inc.
P.O. Box 9671
Providence, RI 02940
Further information is contained
in the Prospectus, which must
precede or accompany this report.
Printed in U.S.A. 131AR949
(Dreyfus Logo)
General California
Municipal
Bond Fund, Inc.
Annual Report
September 30, 1994
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT
IN GENERAL CALIFORNIA MUNICIPAL BOND FUND, INC.
AND THE LEHMAN BROTHERS MUNICIPAL BOND INDEX *
EXHIBIT A:
__________________________________________________
| | LEHMAN | GENERAL |
| | BROTHERS | CALIFORNIA |
| PERIOD | MUNICIPAL | MUNICIPAL |
| | BOND INDEX * | BOND FUND |
|--------------------|--------------|-------------|
| 10/10/89 | 10,000 | 10,000 |
| 9/30/90 | 10,680 | 10,676 |
| 9/30/91 | 12,088 | 11,888 |
| 9/30/92 | 13,351 | 13,114 |
| 9/30/93 | 15,053 | 15,086 |
| 9/30/94 | 14,685 | 14,418 |
|-------------------------------------------------|
*Source: Lehman Brothers
