LEBENTHAL FUNDS, INC.
ANNUAL REPORT
NOVEMBER 30, 1997
LEBENTHAL FUNDS, INC.
120 BROADWAY, NEW YORK, NY 10271
212-425-6116
OUTSIDE NYC TOLL FREE 1-800-221-5822
Dear Shareholder:
The Lebenthal Bond Funds continue to do well versus their peer funds. For the
twelve months ended November 30, 1997, Lipper Analytical Services, Inc.,
(Lipper) ranked the $134.1 million Lebenthal New York Fund #7 of the 93 NY
municipal bond funds listed as being peer funds. For the three years ended
November 30, 1997 Lipper ranked the Lebenthal NY Fund #2 out of 75 peer funds.
For the five years ended November 30, 1997 Lipper ranked the Lebenthal NY Fund
#1 out of 44 peer funds.
The performance records of the $6.1 million Lebenthal New Jersey and the $14.9
million Lebenthal Taxable Municipal Bond Funds relative to their peers have
also been excellent.
Total returns as provided by Lipper are historical and do not include the sales
charge of 4.5%. Fees waived by the Lebenthal New Jersey and Lebenthal Taxable
Municipal Bond Funds may have had a material effect on the total return figures.
For the year ended November 30, 1997, Lipper ranked (a) the Lebenthal New
Jersey Municipal Bond Fund #1 of 57 New Jersey funds listed as being our peer
funds (b) the Lebenthal Taxable Municipal Bond Fund #2 of 131 taxable bond
funds listed as being our peer funds.
The total return statistics of the Lebenthal Funds for the year ended November
30, 1997, were 8.27% for the New York Fund, 8.84% for the New Jersey Fund, and
10.89% for the Taxable Municipal Bond Fund. These figures do not reflect the
maximum 4.5% sales charge. Taking that into account, for example, an investor
who put $1,000 into each of the funds on December 1, 1996, reinvested the
monthly dividends, and sold on November 30, 1997, would have offset the full
sales charge and still have received $1,034.10 from the New York Fund,
$1,039.00 from the New Jersey Fund, and $1,058.40 from the Taxable Municipal
Fund.
The cumulative total return of the Lebenthal New York Municipal Bond Fund for
the three years ended November 30, 1997 was 42.18%. The average annual total
return for the same time period was 12.45%. These figures do not reflect the
maximum 4.5% sales charge. Taking that into account, for example, an investor
who put $1,000 into the Lebenthal New York fund on December 1, 1994, reinvested
the monthly dividends, and sold on November 30, 1997, would have offset the
full sales charge and still have received $1,105.90.
The cumulative total return of the Lebenthal New York Municipal Bond Fund for
the five years ended November 30, 1997, was 44.67% (4.5% sales charge not
included) and 38.15% if the full 4.5% load had been paid. The average annual
total returns for the same time period were 7.66% (4.5% sales charge not
included) and 6.68% if the full load had been paid. All total return figures
assume reinvestment of monthly dividends and capital gains, and fluctuations in
share prices.
The cumulative total return of each Fund, assuming payment of a full 4.5% load,
from inception through November 30, 1997, was 57.91% for the Lebenthal New York
Municipal Bond Fund (June 24, 1991); (b) 14.73% for the Lebenthal New Jersey
Bond Fund (December 1, 1993); and (c) 30.10% for the Lebenthal Taxable
Municipal Bond Fund (December 1, 1993). The average annual returns for the same
time periods were 7.35%
for the Lebenthal New York Municipal Bond Fund, 3.49% for the Lebenthal New
Jersey Municipal Bond Fund and 6.80% for the Lebenthal Taxable Municipal Bond
Fund.
The SEC yields of the three Funds at their November 30, 1997, offering prices
were: New York, 4.26%; New Jersey, 4.37%; and Taxable Municipal, 5.87%. SEC
yield quotations are based on investment income per share earned during a
particular 30 day period, less expenses accrued during such period (net
investment income), and are computed by dividing the fund's net investment
income by its share price on the last day of the period in accordance with the
formula prescribed by the SEC.
Each of the Lebenthal Municipal Bond Funds have been managed conservatively
during the last year because of our view that the Federal Reserve will
eventually have to further restrict the availability of credit in order to
restrain the wage inflation that could result from unemployment being at near
record peacetime lows. The U.S. unemployment rate could easily go all the way
to 4.0% from the current 4.6% considering the strength of the American economy
and, importantly, the lack of individuals to add to the labor force. Bond
market investors have recently chosen to ignore the strength of the American
economy and instead focus on the beneficial effects on U.S. inflation resulting
from currency turmoil in Asia. Although we believe that the "Asian contagion"
greatly improves the outlook for inflation, we do not think that it will
importantly slow the U.S. economy particularly with the increased stimulus that
will come from recent accelerating strength in most of the Western European
economies. Therefore, we expect that the Federal Reserve Board will be forced
to tighten credit one or more times during the next couple of years.
Many economists believe that bond yields will drop below short-term rates
because substantially fewer long-maturity full coupon bonds are being issued by
the Federal Government due to (a) its improved deficit outlook and (b) the
issuance of large amounts of inflation-indexed bonds. Because we doubt that an
inverted yield curve is likely until a recession looms on the horizon, we think
it is prudent to be concerned about Fed tightening.
Although we have been, and continue to be, bearish on bonds whenever the yield
on the thirty year U.S. Treasury bond dips below 6%, we have chosen to be fully
invested at all times but via use of higher coupon bonds that should hold their
value better in a deteriorating market than low coupon or zero coupon bonds.
Even if we should be wrong about the direction of interest rates, the investors
in our funds are well served by the greater current income available from
premium coupon bonds priced to their call dates rather than to maturity.
Please be mindful of the fact that the information and statistics included in
this commentary are not guaranteed. However, they have been obtained from
reliable sources and are believed to be accurate.
Note: Past performance is no guarantee of the future. No assurance can be given
that the Fund will achieve its objectives. Share price and investment return
will fluctuate, and on the day you sell, the value of your shares may be worth
more or less than the original investment. For more complete information
including all sales charges, send for a free prospectus. Read it carefully
before you invest or send money.
We thank you for the opportunity to be of service.
Very truly yours,
LEBENTHAL NEW YORK MUNICIPAL BOND FUND
PERFORMANCE COMPARISON CHART
_______________________________________________________________________________
The following chart compares the performance of Lebenthal New York Municipal
Bond Fund (with and without the 4.5% sales load), for the one year and since
inception periods, against the Lehman Brothers Municipal Bond Index (Lehman
Index) for the same time periods. It is important to keep in mind that the
Lehman Index excludes the effects of any fees or sales charges, and does not
reflect state-specific bond market performance.
LEBENTHAL NEW YORK MUNICIPAL BOND FUND
PERFORMANCE COMPARISON CHART
AVERAGE ANNUAL
TOTAL RETURN SINCE
COMMENCEMENT
ONE FIVE OF OPERATIONS
YEAR YEAR JUNE 24, 1991
-------- -------- ----------------
Lebenthal New York Municipal Bond Fund:
with sales load 3.41% 6.68% 7.35%
without sales load 8.27% 7.66% 8.12%
Lehman Index 9.13% 7.26% 7.43%
Past performance is not predictive of future performance.
See Notes to Financial Statements.
LEBENTHAL NEW JERSEY MUNICIPAL BOND FUND
PERFORMANCE COMPARISON CHART
_______________________________________________________________________________
The following chart compares the performance of Lebenthal New Jersey Municipal
Bond Fund (with and without the 4.5% sales load), for the one year and since
inception periods, against the Lehman Brothers Municipal Bond Index (Lehman
Index) for the same time periods. It is important to keep in mind that the
Lehman Index excludes the effects of any fees or sales charges, and does not
reflect state-specific bond market performance.
LEBENTHAL NEW JERSEY MUNICIPAL BOND FUND
PERFORMANCE COMPARISON CHART
AVERAGE ANNUAL
TOTAL RETURN SINCE
ONE COMMENCEMENT OF OPERATIONS
YEAR DECEMBER 1, 1993
------- --------------------------
Lebenthal New Jersey Municipal Bond Fund:
with sales load 3.90% 3.49%
without sales load 8.84% 4.64%
Lehman Index 9.13% 5.90%
Past performance is not predictive of future performance.
See Notes to Financial Statements.
LEBENTHAL TAXABLE MUNICIPAL BOND FUND
PERFORMANCE COMPARISON CHART
_______________________________________________________________________________
The following chart compares the performance of Lebenthal Taxable Municipal
Bond Fund (with and without the 4.5% sales load), for the one year and since
inception periods, against the Lehman Brothers Long Corporate Bond Index
(Lehman Index) for the same time periods. It is important to keep in mind that
the Lehman Index excludes the effects of any fees or sales charges, and does
not reflect state-specific bond market performance.
LEBENTHAL TAXABLE MUNICIPAL BOND FUND
PERFORMANCE COMPARISON CHART
AVERAGE ANNUAL
TOTAL RETURN SINCE
ONE COMMENCEMENT OF OPERATIONS
YEAR DECEMBER 1, 1993
-------- --------------------------
Lebenthal Taxable Municipal Bond Fund:
with sales load 5.84% 6.80%
without sales load 10.89% 8.04%
Lehman Index 9.87% 8.47%
Past performance is not predictive of future performance.
See Notes to Financial Statements.
LEBENTHAL NEW YORK MUNICIPAL BOND FUND
STATEMENT OF INVESTMENTS
NOVEMBER 30, 1997
_______________________________________________________________________________
RATINGS
(UNAUDITED)
-----------------
FACE VALUE STANDARD
AMOUNT (NOTE 1) MOODY'S & POOR'S
- ---------- ---------- ------- --------
MUNICIPAL BONDS (104.34%)
- -------------------------------------------------------------------------------
$ 760,000 Metropolitan Trans Authority,
New York Commuter Facility,
5.375%, due 07/01/27, (FGIC Insured) $ 759,400 Aaa AAA
1,000,000 Metropolitan Trans Authority, New
York Commuter Facility - Series R,
5.50%, due 07/01/17 973,510 Baa1 BBB+
1,285,000 Monroe County, New York IDA Civic
Facility (DePaul Community
Facility), 6.50%, due 02/01/24,
(SONYMA Insured) 1,400,200 Aa
4,400,000 New York, New York - Series I,
General Obligation,
6.25%, due 04/15/27 4,672,096 Baa1 BBB+
1,670,000 New York, New York (Unrefunded
Balance) - Series C, General
Obligation, 7.25%, due 08/15/24 1,816,376 Baa1 BBB+
1,325,000 New York, New York - Series D,
General Obligation, 5.25%,
due 08/01/21 1,269,496 Baa1 BBB+
1,150,000 New York, New York, City
Municipal Water - Series B,
5.75%, due 06/15/26, (MBIA Insured) 1,197,978 Aaa AAA
1,705,000 New York State Dormitory Authority
(Health Facilities),
5.50%, due 05/15/24, (FSA Insured) 1,719,816 Aaa AAA
2,400,000 New York State Dormitory Authority
(Saint Vincent's Hospital),
7.40%, due 08/01/30, (FHA Insured) 2,659,200 Aa2 AAA
7,110,000 New York State Dormitory Authority
Highlands Living),
6.60%, due 02/01/34, (FHA Insured) 7,807,917 AA
2,330,000 New York State Dormitory Authority
(Presbyterian Residential Community),
6.50%, due 08/01/34, (FHA Insured) 2,523,600 AA
750,000 New York State Dormitory Authority
(State University Educational
Facilities), 7.00%, due 05/15/16 809,258 A3 A-
3,500,000 New York State Dormitory Authority
(Jewish Geriatric - Long Island),
7.35%, due 08/01/29, (FHA Insured) 4,016,250 AAA
5,190,000 New York State Dormitory Authority
(Niagara Frontier Home),
6.40%, due 02/01/35, (FHA Insured) 5,666,338 AA
1,000,000 New York State Dormitory Authority
(St. Lukes Home Residential Health),
6.375%, due 08/01/35, (FHA Insured) 1,094,980 AA
3,900,000 New York State Dormitory Authority
(Nottingham Retirement Community),
6.125%, due 07/01/25, (SONYMA Insured) 4,178,655 Aa
4,755,000 New York State Dormitory Authority
(Geneva Nursing Home),
6.20%, due 08/01/35, (FHA Insured) 5,135,020 AA
3,300,000 New York State Dormitory Authority
(Ellis Hospital), 5.60%,
due 08/01/25, (MBIA/FHA Insured) 3,343,989 Aaa AAA
5,750,000 New York State Dormitory Authority
(Nursing Home-St. Johns Health),
6.25%, due 02/01/36, (FHA Insured) 6,263,245 AA
See Notes to Financial Statements.
LEBENTHAL NEW YORK MUNICIPAL BOND FUND
STATEMENT OF INVESTMENTS (CONTINUED)
NOVEMBER 30, 1997
_______________________________________________________________________________
RATINGS
(UNAUDITED)
-----------------
FACE VALUE STANDARD
AMOUNT (NOTE 1) MOODY'S & POOR'S
- ---------- ---------- ------- --------
MUNICIPAL BONDS (CONTINUED)
- -------------------------------------------------------------------------------
$2,730,000 New York State Dormitory Authority
(Jewish Home of Central NY),
LOC Onbank & Trust Co.,
6.25%, due 07/01/25 $2,977,475 Aaa
500,000 New York State Dormitory Authority
(Dept. Of Education),
5.75%, due 07/01/21 517,210 Aaa AAA
2,400,000 New York State Dormitory Authority
(Nursing Home),
6.125%, due 02/01/36, (FHA Insured) 2,571,768 AAA
3,000,000 New York State Dormitory Authority
(Methodist Hospital), 6.05%,
due 02/01/34, (AMBAC/FHA Insured) 3,209,160 Aaa AAA
750,000 New York State Dormitory Authority
(Grace Manor Health Care Facility),
6.15%, due 07/01/18, (SONYMA Insured) 813,788 Aa2
3,300,000 New York State Dormitory Authority
(Mental Health Services Facility),
5.625%, due 02/15/21 3,322,902 Baa1 A-
4,000,000 New York State Dormitory Authority
(Nursing Home-Menorah Campus),
6.10%, due 02/01/37, (FHA Insured) 4,263,400 AAA
700,000 New York State Dormitory Authority
(Millard Fillmore Hospital),
5.375%, due 02/01/32,
(AMBAC/FHA Insured) 692,916 Aaa AAA
1,000,000 New York State Dormitory Authority
(Nursing Home-Rosalind & Joseph),
5.70%, due 02/01/37,
(AMBAC/FHA Insured) 1,023,150 Aaa AAA
2,000,000 New York State Dormitory Authority
(Hospital United Health Services),
5.375%, due 08/01/27,
(AMBAC/FHA Insured) 1,986,620 AAA
1,500,000 New York State Dormitory Authority
(Hunts Point Multi-Service Center),
5.625%, due 07/01/22,(SONYMA Insured) 1,511,040 Aa2
2,745,000 New York State Dormitory Authority
(Mental Health Services Facilities),
5.125%, due 08/15/22, (FSA Insured),
When Issued 2,656,995 Aaa AAA
1,500,000 New York State Dormitory Authority
(Mental Health Services Facilities),
5.125%, due 08/15/27, (FSA Insured),
When Issued 1,463,010 Aaa AAA
1,500,000 New York State Dormitory Authority
(Saint Barnabas Hospital), 5.45%,
due 08/01/35, (AMBAC/FHA Insured),
When Issued 1,497,495 Aaa AAA
1,000,000 New York State Energy Research &
Development Authority - Electric
Facilities - (Long Island Lighting),
7.15%, due 02/01/22 1,087,080 Ba3 BB+
1,000,000 New York State Energy Research &
Development Authority Gas Facilities,
(Brooklyn Union Gas), 6.75%,
due 02/01/24, (MBIA Insured) 1,089,090 Aaa AAA
500,000 New York State Energy Research &
Development Authority - Pollution
Control - (Niagara Mohawk Power
Corporation), 6.625%, due 10/01/13,
(FGIC Insured) 545,120 Aaa AAA
3,400,000 New York State Housing Finance
Agency (Phillips Village Project -
Series A), 7.75%, due 08/15/17,
(FHA/SONYMA Insured) 3,779,745 A2
See Notes to Financial Statements.
LEBENTHAL NEW YORK MUNICIPAL BOND FUND
STATEMENT OF INVESTMENTS (CONTINUED)
NOVEMBER 30, 1997
_______________________________________________________________________________
RATINGS
(UNAUDITED)
-----------------
FACE VALUE STANDARD
AMOUNT (NOTE 1) MOODY'S & POOR'S
- ---------- ---------- ------- --------
MUNICIPAL BONDS (CONTINUED)
- -------------------------------------------------------------------------------
$1,500,000 New York State Housing Finance
Agency (Insured-Multifamily
Mortgage - Series C), 6.50%,
due 08/15/24, (FHA Insured) $1,566,855 Aa2 AAA
2,000,000 New York State Housing Finance
Agency (Housing Project
Mortgage - Series A), 6.125%,
due 11/01/20, (FSA Insured) 2,109,440 Aaa AAA
2,515,000 New York State Housing Finance
Agency (Multifamily Housing -
Second Mortgage - Series C), 6.10%,
due 08/15/28, (SONYMA Insured) 2,639,367 Aa2
2,000,000 New York State Housing Finance
Agency (Multifamily Housing -
Series D), 6.10%, due 11/15/36,
(FHA Insured) 2,084,380 AAA
2,350,000 New York State Housing Finance
Agency Services, Contract
Obligation, 5.50%, due 03/15/25,
When Issued 2,320,343 Baa1 BBB+
1,750,000 New York State Medical Care
Facilities Finance Agency (Hospital
& Nursing Home) - Series D,
6.60%, due 02/15/31, (FHA Insured) 1,903,160 AAA
6,750,000 New York State Medical Care
Facilities Finance Agency -
Series B, 6.60%, due 08/15/34,
(FHA Insured) 7,415,145 Aa2 AA
60,000 New York State Medical Care
Facilities Finance Agency,
7.30%, due 02/15/21 66,502 Baa1 A-
5,300,000 New York State Medical Care
Facilities Finance Agency -
Series A, 6.90%, due 08/15/34,
(AMBAC/FHA Insured) 6,067,705 Aaa AAA
6,950,000 New York State Medical Care
Facilities Finance Agency -
Mortgage Project-Series C, 6.375%,
due 08/15/29, (FHA Insured) 7,566,465 Aa2 AA
2,505,000 New York State Medical Care
Facilities Finance Agency
(Mortgage Project - Series A),
6.50%, due 02/15/35, (FHA Insured) 2,749,062 Aa2 AA
5,000,000 New York State Medical Care
Facilities Finance Agency
(Mortgage Project - Series E),
6.375%, due 02/15/35, (FHA Insured) 5,476,450 Aa2 AA
1,000,000 New York State Urban Development
Corp, (Senior Lien Corp.),
5.50%, due 07/01/26, (HUD Insured) 1,002,330 Aaa AAA
1,600,000 Oswego County New York Development
Agency, (Seneca Hill Project -
Series A), 5.65%, due 08/01/37,
(FHA Insured) 1,610,736 AA
3,000,000 Syracuse New York Housing
Authority-Series A,
5.80%, due 08/01/37, (FHA Insured) 3,070,800 AAA
TOTAL MUNICIPAL BONDS
(COST $130,364,523) 139,964,028
See Notes to Financial Statements.
LEBENTHAL NEW YORK MUNICIPAL BOND FUND
STATEMENT OF INVESTMENTS (CONTINUED)
NOVEMBER 30, 1997
_______________________________________________________________________________
FACE VALUE
AMOUNT (NOTE 1)
- --------- -------------
COMMERCIAL PAPER (.37%)
- -------------------------------------------------------------------------------
$ 334,000 Ford Motor Credit Company, 5.56%, due 12/04/97 $ 334,000
159,000 General Motors Acceptance Corporation, 5.58%,
due 12/04/97 159,000
TOTAL COMMERCIAL PAPER (COST $493,000) 493,000
TOTAL INVESTMENTS (104.71%) (COST $130,857,523)# 140,457,028
CASH AND OTHER ASSETS, NET OF LIABILITIES (-4.71%) (6,312,968)
NET ASSETS (100.00%) $134,144,060
# Aggregate cost for federal income tax purposes is materially the same.
Aggregate unrealized appreciation and depreciation, based on cost for
federal income tax purposes, are $9,599,505 and $0 respectively, resulting in
net unrealized appreciation of $9,599,505.
KEY:
AMBAC = Ambac Indemnity Corporation
FGIC = Federal Guaranty Insurance Corporation
FHA = Federal Housing Administration
HUD = Housing and Urban Development
MBIA = Municipal Bond Insurance Association
MHRB = Multi-family Housing Revenue Bond
SONYMA = State of New York Mortgage Agency
See Notes to Financial Statements.
LEBENTHAL NEW JERSEY MUNICIPAL BOND FUND
STATEMENT OF INVESTMENTS
NOVEMBER 30, 1997
_______________________________________________________________________________
RATINGS
(UNAUDITED)
-----------------
FACE VALUE STANDARD
AMOUNT (NOTE 1) MOODY'S & POOR'S
- ---------- ---------- ------- --------
MUNICIPAL BONDS (89.09%)
- -------------------------------------------------------------------------------
$ 125,000 Cape May County, New Jersey
Industrial Pollution Control
Financing Authority, Atlantic City
Electric Company Project A,
7.20%, due 11/01/29, (MBIA Insured) $ 142,305 Aaa AAA
110,000 Essex County, New Jersey Import
Authority County Correctional
Facility- Series A, 5.70%,
due 01/01/27, (FGIC Insured) 114,303 Aaa AAA
70,000 Essex County, New Jersey Import
Authority Orange School District -
Series A, 6.95%, due 07/01/14,
(MBIA Insured) 80,647 Aaa AAA
100,000 Irvington, New Jersey Housing &
Mortgage Finance Authority,
6.50%, due 02/01/24, (FHA Insured) 105,405 AAA
300,000 Middlesex County New Jersey Import
Authority, 5.90%, due 9/15/21 314,375 A1 A+
100,000 New Jersey Economic Development
Authority, Economic Development
Revenue - American Airlines Inc.
Project, 7.10%, due 11/01/31 109,380 Baa2 BBB-
250,000 New Jersey Economic Development
Authority, Economic Development
Revenue - Bancroft Incorporated
Obligation Group, 6.05%,
due 12/01/25, (Connie Lee Insured) 266,617 AAA
150,000 New Jersey Economic Development
Authority, Economic Development
Revenue Refunding - Burlington Coat
Factory, LOC First Fidelity Bank,
6.125%, due 09/01/10 161,990 Aa3
150,000 New Jersey Economic Development
Authority, Economic Development
Revenue W.Y. Urban Holding Company,
LOC NatWest Bank, Jersey City,
6.50%, due 06/01/15 162,404 A
200,000 New Jersey Economic Development
Authority, Economic Development
Revenue Heath Village Project,
LOC First Union, 6.00%,
due 05/01/16 211,946 A+
100,000 New Jersey Economic Development
Authority, Pollution Control
Revenue PSE&G Co. Project, 6.40%,
due 05/01/32, (MBIA Insured) 108,316 Aaa AAA
100,000 New Jersey Economic Development
Authority, American Water Co.
Facilities Revenue Project A,
6.875%, due 11/01/34, (FGIC Insured) 112,214 Aaa AAA
100,000 New Jersey Economic Development
Authority Revenue Sewer Facilities
- Anheuser-Busch Project,
5.85%, due 12/01/30 104,229 A1 A+
85,000 New Jersey Health Care Facilities
Financing Authority - Irvington
General Hospital Issue - Series 1994,
6.40%, due 08/01/25, (FHA Insured) 91,690 AAA
125,000 New Jersey Health Care Facilities
Financing Authority - General
Hospital Center at Passaic, 6.75%,
due 07/01/19, (FSA Insured) 143,129 Aaa AAA
100,000 New Jersey Health Care Facilities
Financing Authority Revenue Monmouth
Medical Center Issue - Series C,
6.25%, due 7/01/24, (FSA Insured) 108,856 Aaa AAA
See Notes to Financial Statements.
LEBENTHAL NEW JERSEY MUNICIPAL BOND FUND
STATEMENT OF INVESTMENTS (CONTINUED)
NOVEMBER 30, 1997
_______________________________________________________________________________
RATINGS
(UNAUDITED)
-----------------
FACE VALUE STANDARD
AMOUNT (NOTE 1) MOODY'S & POOR'S
- ---------- ---------- ------- --------
MUNICIPAL BONDS (CONTINUED)
- -------------------------------------------------------------------------------
$ 150,000 New Jersey Health Care Facilities
Financing Authority Revenue
St. Joseph's Hospital & Medical
Center, 6.00%, due 7/01/26,
(Connie Lee Insured) $ 159,671 AAA
100,000 New Jersey Health Care Facilities
Financing Authority AHS Hospital
- Series A, 5.00%, due 07/01/27,
(AMBAC Insured) 95,971 Aaa AAA
100,000 New Jersey Economic Development
Authority Revenue Economic Growth
- Series D, LOC NatWest Bank,
Jersey City, 6.55%, due 08/01/14 107,707 A
150,000 New Jersey State Education
Facilities Authority - Trenton
State College - Series E, 6.00%,
due 07/01/19, (AMBAC Insured) 158,586 Aaa AAA
290,000 New Jersey State Education
Facilities Authority - Monmouth
University, 5.40%, due 07/01/06 298,007 Baa2 BBB
100,000 New Jersey State Education
Facilities Authority - New Jersey
Institute Technology Issue -
Series A, 6.00%, due 07/01/24,
(MBIA Insured) 106,550 Aaa AAA
250,000 New Jersey State Higher Education
Assistance Authority- Student Loan
Revenue- Loan Program - Series A,
5.80%, due 06/01/16, (MBIA Insured) 257,407 Aaa AAA
125,000 New Jersey State Housing & Mortgage
Finance Agency MHRB Refunding -
Presidential Plaza, 7.00%,
due 05/01/30, (FHA Insured) 135,025 AAA
300,000 New Jersey State Housing & Mortgage
Finance Agency MHRB Series A,
6.05%, due 11/01/20, (AMBAC Insured) 312,666 Aaa AAA
100,000 New Jersey State Housing & Mortgage
Finance Agency MHRB Series A, 6.25%,
due 05/01/28, (AMBAC Insured) 105,318 Aaa AAA
125,000 New Jersey State Housing & Mortgage
Finance Agency Revenue Housing -
Series A, HUD Section 8, 6.95%,
due 11/01/13 135,069 A+
150,000 New Jersey State Housing & Mortgage
Finance Agency - Home Buyers -
Series O, 6.35%, due 10/01/27,
(MBIA Insured), Subject to AMT 158,178 Aaa AAA
140,000 Newark, New Jersey Housing Finance
Corporation Mortgage Revenue,
Refunding - HUD Section 8-Manor
Apartments-A, 7.50%, due 02/15/24,
(FHA Insured) 152,842 AAA
800,000 Port Authority of New York & New
Jersey Special Obligation Revenue
JFK International Air Terminal -
Series 6, 5.75%, due 12/01/22 828,800 Aaa AAA
100,000 Puerto Rico Housing Bank & Finance
Agency Single Family Mortgage
Affordable Housing Mortgage -
Portfolio I, 6.25%, due 04/01/29,
(GNMA/FNMA/FHLMA Insured),
Subject to AMT 104,226 Aaa AAA
TOTAL MUNICIPAL BONDS
(COST $5,089,311) 5,453,829
See Notes to Financial Statements.
LEBENTHAL NEW JERSEY MUNICIPAL BOND FUND
STATEMENT OF INVESTMENTS (CONTINUED)
NOVEMBER 30, 1997
_______________________________________________________________________________
VALUE
SHARES (NOTE 1)
- ---------- ----------
CLOSED-END FUNDS (8.74%)
- -------------------------------------------------------------------------------
12,198 Muniyield New Jersey Insured Fund $ 199,742
4,292 Munivest New Jersey Fund 59,015
17,749 Muniyield New Jersey Fund 276,219
TOTAL CLOSED-END FUNDS (COST $521,082) 534,976
TOTAL INVESTMENTS (97.83%)(COST $5,610,393)# 5,988,805
CASH AND OTHER ASSETS, NET OF LIABILITIES (2.17%) 132,779
NET ASSETS (100.00%) $6,121,584
# Aggregate cost for federal income tax purposes is $5,610,399.
Aggregate unrealized appreciation and depreciation, based on cost for
federal income tax purposes, are $378,406 and $0, respectively, resulting in
net unrealized appreciation of $378,406.
KEY:
AMBAC = Ambac Indemnity Corporation
AMT = Alternative Minimum Tax
FGIC = Federal Guaranty Insurance Corporation
FHA = Federal Housing Authority
FHLMA = Federal Home Loan Mortgage Association
FSA = Financial Security Assurance, Inc.
CONNIE LEE = College Construction Loan Insurance Association
FNMA = Federal National Mortgage Association
GNMA = Government National Mortgage Association
HUD = Housing and Urban Development
LOC = Letter of Credit
MBIA = Municipal Bond Insurance Association
MHRB = Multi-family Housing Revenue Bond
See Notes to Financial Statements.
LEBENTHAL TAXABLE MUNICIPAL BOND FUND
STATEMENT OF INVESTMENTS
NOVEMBER 30, 1997
_______________________________________________________________________________
RATINGS
(UNAUDITED)
-----------------
FACE VALUE STANDARD
AMOUNT (NOTE 1) MOODY'S & POOR'S
- ---------- ---------- ------- --------
MUNICIPAL BONDS (97.69%)
- -------------------------------------------------------------------------------
$ 150,000 All Saints Health System, 9.00%,
due 08/15/24, (MBIA Insured) $ 168,231 Aaa AAA
700,000 Atlanta & Fulton County Georgia -
Downtown Arena Project, 7.00%,
due 12/01/28, (FSA Insured),
When Issued 693,868 Aaa AAA
385,000 Baltimore, Maryland - Series B,
General Obligation, 7.90%,
due 10/15/16, (FGIC Insured) 413,194 Aaa AAA
1,100,000 Bastrop, Texas Economic Development
Corporation, 8.00%, due 08/15/16 1,147,377 BBB+
100,000 Buffalo, New York - Series F, 9.05%,
due 02/01/15, (AMBAC Insured) 106,358 Aaa AAA
240,000 California Housing Finance Agency
- Series C, 8.10%, due 02/01/37,
(AMBAC Insured) 253,404 Aaa AAA
700,000 Cedartown Georgia Development
Authority, Industrial Park
Project A, 7.00%, due 02/01/22,
(AMBAC Insured), When Issued 690,277 Aaa AAA
2,000,000 Compton, California Community
Redevelopment Agency - Series C,
Tax Allocation, 0.00%*,
due 08/01/22, (FSA Insured) 365,340 Aaa AAA
150,000 Connecticut State Health and
Educational Facilities, Maefair
Health Care, 9.20%, due 11/01/24 181,923 A1 AA-
125,000 Connecticut State Health and
Educational Facilities,
Laurelwood, 9.36%, due 11/01/24 142,870 A1 AA-
150,000 Connecticut State Health and
Educational Facilities, Shady
Knoll Center, 8.90%, due 11/01/24 174,596 A1 AA-
255,000 Connecticut State Housing Finance
Authority - Series F, 9.25%,
due 05/15/27 293,551 Aa2 AA
200,000 Connecticut State Housing Finance
Authority - Series G, 7.625%,
due 05/15/21 210,708 Aa2 AA
100,000 Connecticut State Development
Authority - Sub series B1,
8.50%, due 08/15/14 108,777 A+
125,000 Conyers, Georgia Water & Sewer -
Series B, 8.75%, due 07/01/15,
(AMBAC Insured) 138,388 Aaa AAA
250,000 Cuyahoga County, Ohio Economic
Development - Series A,
8.625%, due 06/01/22 279,500 A
200,000 Florida Housing Finance Agency -
Taxable Housing Mariner Club,
8.25%, due 09/01/15,
(AMBAC Insured) 215,628 Aaa AAA
1,230,000 Harrisburg, Pennsylvania -
Series A, General Obligation,
0.00%*, due 04/01/18,
(AMBAC Insured) 312,531 Aaa AAA
1,165,000 Harrisburg, Pennsylvania -
Series A, General Obligation,
0.00%*, due 04/01/19,
(AMBAC Insured) 276,734 Aaa AAA
350,000 Harrison County, Mississippi -
Series A, General Obligation,
7.75%, due 04/01/16,
(MBIA Insured) 364,756 Aaa
150,000 Idaho Housing Agency, HUD Section 8,
8.50%, due 07/01/09 161,672 A
See Notes to Financial Statements.
LEBENTHAL TAXABLE MUNICIPAL BOND FUND
STATEMENT OF INVESTMENTS (CONTINUED)
NOVEMBER 30, 1997
_______________________________________________________________________________
RATINGS
(UNAUDITED)
-----------------
FACE VALUE STANDARD
AMOUNT (NOTE 1) MOODY'S & POOR'S
- ---------- ---------- ------- --------
MUNICIPAL BONDS (CONTINUED)
- -------------------------------------------------------------------------------
$ 150,000 Illinois Housing Development
Authority, 8.64%, due 12/01/21,
(AMBAC Insured) $ 162,819 Aaa AAA
2,180,000 Kern County, California Pension
Obligation, 0.00%*, due 08/15/18,
(MBIA Insured) 523,177 Aaa AAA
325,000 Maryland State Community
Development Administration,
9.10%, due 05/15/10,
(MHF Insured) 358,722 Aa3
150,000 Memorial Health System, 8.375%,
due 10/01/20, (MBIA Insured) 163,427 Aaa AAA
200,000 Michigan State Housing Development
Authority - Series A, 8.30%,
due 11/01/15, (AMBAC Insured) 223,548 Aaa AAA
60,000 Minnesota State Housing Finance
Agency - Series B, 8.00%,
due 02/01/18 63,085 AA
50,000 Minnesota State Housing Finance
Agency, 8.05%, due 01/01/12 52,489 Aa2 AA+
600,000 Mississippi Hospital Equipment and
Facilities, 9.10%, due 04/01/06 633,864 Baa
85,000 New Hampshire State Housing and
Finance Authority - Series C,
9.40%, due 07/01/14 94,340 Aa2
239,250 New Jersey Economic Development
Authority - Series C, 7.60%,
due 02/15/29, (FSA Insured)** 246,059 Aaa AAA
240,000 New Jersey State Housing and Mortgage
Finance Agency - Series E,
8.95%, due 11/01/12 260,990 AA-
250,000 New York State Environmental
Facilities - Series A, 9.625%,
due 03/15/21 278,160 Baa1 BBB+
300,000 New York State Housing Finance
Agency - Series B, 8.25%,
due 05/15/35, (FHA Insured) 314,151 AAA
350,000 New York State Housing Finance
Agency Revenue - Multi-family
Series C, 8.11%, due 11/15/38,
(FHA Insured) 370,636 AAA
110,000 New York State Housing Finance
Agency - Series B, Service Contract
Obligation, 8.60%, due 03/15/04 118,763 Baa1 BBB+
100,000 Pittsburgh, Pennsylvania Urban
Redevelopment Authority,
9.07%, due 09/01/14, (FSA Insured) 114,880 Aaa AAA
300,000 Sacramento County, California,
0.00%***, due 08/15/21,
(MBIA Insured) 314,079 Aaa AAA
120,000 Southeastern Pennsylvania Transit
Authority - Series B, 8.75%,
due 03/01/20, (FGIC Insured) 134,168 Aaa AAA
300,000 Tampa, Florida Sports Authority,
8.07%, due 10/01/26, (MBIA Insured) 321,486 Aaa AAA
375,000 Texas State Department of Housing &
Community Affairs - Series C1,
7.76%, due 09/01/17, (MBIA Insured) 393,765 Aaa AAA
300,000 Texas State Veterans Housing,
General Obligation, 7.35%,
due 12/01/21 306,375 Aa2 AA
1,050,000 United Nations Development
Corporation Refunded, 8.80%,
due 07/01/26 1,217,411 AAA
500,000 Virginia State Housing Development
Authority Commonwealth Mortgage,
7.80%, due 07/01/17 525,550 Aa1 AA+
See Notes to Financial Statements.
LEBENTHAL TAXABLE MUNICIPAL BOND FUND
STATEMENT OF INVESTMENTS (CONTINUED)
NOVEMBER 30, 1997
_______________________________________________________________________________
RATINGS
(UNAUDITED)
-----------------
FACE VALUE STANDARD
AMOUNT (NOTE 1) MOODY'S & POOR'S
- ---------- ---------- ------- --------
MUNICIPAL BONDS (CONTINUED)
- -------------------------------------------------------------------------------
$ 365,000 Virginia State Housing Development
Authority - Series A, Multi-family,
8.125%, due 11/01/15 $ 388,776 Aa1 AA+
350,000 Wisconsin Housing & Economic
Development Authority - Series H,
7.875%, due 03/01/26 367,297 Aa2 AA
TOTAL MUNICIPAL BONDS
(COST $13,607,551) 14,647,700
COMMERCIAL PAPER (5.38%)
- -------------------------------------------------------------------------------
651,000 Ford Motor Credit Company, 5.54%,
due 12/10/97 651,000
156,000 General Motors Acceptance
Corporation, 5.56%, due 12/11/97 156,000
TOTAL COMMERCIAL PAPER
(COST $807,000) 807,000
CLOSED-END FUNDS (4.66%)
- -------------------------------------------------------------------------------
74,977 Hyperion Total Return Fund 698,223
TOTAL CLOSED-END FUNDS (COST $699,049) 698,223
TOTAL INVESTMENTS (107.73%)
(COST $15,113,600)# 16,152,923
LIABILITIES IN EXCESS OF CASH AND
OTHER ASSETS (-7.73%) (1,159,049)
NET ASSETS (100.00%) 14,993,874
# Aggregate cost for federal income tax purposes is $15,122,140.
Aggregate unrealized appreciation and depreciation, based on cost for
federal income tax purposes, are $1,036,694 and $5,911, respectively, resulting
in net unrealized appreciation of $1,030,783.
* Zero Coupon Bond
** Series 1997C bonds traded on the New York Stock Exchange are treated as
equity securities and trade in $25 increments.
*** Zero Coupon Bond. Rate changes to 7.68% on 8/15/98
KEY:
AMBAC = Ambac Indemnity Corporation
FGIC = Federal Guaranty Insurance Corporation
FHA = Federal Housing Authority
FSA = Financial Security Assurance, Inc.
HUD = Housing and Urban Development
MBIA = Municipal Bond Insurance Association
MHF = Maryland Housing Fund
See Notes to Financial Statements.
LEBENTHAL FUNDS, INC.
STATEMENTS OF ASSETS AND LIABILITIES
NOVEMBER 30, 1997
_______________________________________________________________________________
LEBENTHAL LEBENTHAL LEBENTHAL
NEW YORK NEW JERSEY TAXABLE
MUNICIPAL MUNICIPAL MUNICIPAL
BOND FUND BOND FUND BOND FUND
------------- ------------ ------------
ASSETS
Investment in securities at value
(cost $130,857,523, $5,610,393
and $15,113,600) $140,457,028 $5,988,805 $16,152,923
Cash 46,343 5,725 14,793
Receivables:
Securities sold 272,201 -- --
Capital shares sold 868,425 15,235 92,103
Interest and Dividends 2,303,891 109,377 220,205
Due from Manager -- 46,007 35,823
Deferred organization expenses -- 7,745 6,249
Total assets 143,947,888 6,172,894 16,522,096
LIABILITIES
Payables:
Securities purchased 9,049,734 -- 1,394,938
Capital shares redeemed 189,669 734 38,833
Dividends declared 361,772 17,132 54,666
Distribution fee payable (Note 3) 27,251 -- --
Management fee payable (Note 2) 24,883 1,247 3,061
Administration fee payable 30,573 7,324 9,269
Accrued Directors' fees 2,294 160 267
Accrued expenses and other
liabilities 117,652 24,713 27,188
Total liabilities 9,803,828 51,310 1,528,222
NET ASSETS 134,144,060 6,121,584 14,993,874
NET ASSETS CONSIST OF:
Par value 16,121 879 2,034
Paid in capital 125,189,461 6,006,922 14,314,419
Undistributed investment income - net 8,544 -- --
Accumulated net realized loss on
investments (669,571) (264,629) (361,902)
Unrealized appreciation on
investments - net 9,599,505 378,412 1,039,323
Total net assets $134,144,060 $6,121,584 $14,993,874
Shares outstanding (Note 4) 16,120,575 878,745 2,033,747
Net asset value, and redemption
price per share $ 8.32 $ 6.97 $ 7.37
Maximum offering price per share* $ 8.71 $ 7.30 $ 7.72
* The sales charge is 4.5% of the offering price on a single sale of less than
$50,000, reduced on sales of $50,000 or more and certain other sales.
See Notes to Financial Statements.
LEBENTHAL FUNDS, INC.
STATEMENTS OF OPERATIONS
YEAR ENDED NOVEMBER 30, 1997
_______________________________________________________________________________
LEBENTHAL LEBENTHAL LEBENTHAL
NEW YORK NEW JERSEY TAXABLE
MUNICIPAL MUNICIPAL MUNICIPAL
BOND FUND BOND FUND BOND FUND
------------ ------------ ------------
INVESTMENT INCOME
Income:
Interest $ 7,443,167 $300,698 $1,036,515
Dividends 126,132 16,645 88,004
Total income 7,569,299 317,343 1,124,519
Expenses:
Management fee (Note 2) 288,050 13,639 35,804
Distribution fee (Note 3) 313,188 13,639 35,804
Administration fee 143,014 6,213 16,453
Shareholder servicing and related
shareholder expenses 126,732 33,233 36,485
Custodian fee 22,655 3,234 5,855
Interest 3,759 193 2,026
Legal, compliance and filing fees 104,137 15,695 16,584
Audit and accounting fees 53,301 44,865 45,637
Directors' fees 11,984 594 1,432
Amortization of organization
expenses (Note 1) -- 7,745 6,249
Other 45,120 1,157 1,452
Total expenses 1,111,940 140,207 203,781
Less:Reimbursement of expenses by
Manager (Note 2) -- (74,043) (17,513)
Fees waived by Manager and
Distributor (Note 3) -- (27,278) (71,608)
Fees paid indirectly (Note 1) (3,231) (832) (910)
Net expenses 1,108,709 38,054 113,750
Net investment income 6,460,590 279,289 1,010,769
REALIZED AND UNREALIZED GAIN ON
INVESTMENTS
Net realized gain on investments 1,262,317 28,867 97,125
Change in unrealized appreciation
of investments 2,368,635 153,909 404,164
Net realized and unrealized gain on
investments 3,630,952 182,776 501,289
Increase in net assets from
operations $10,091,542 $462,065 $1,512,058
See Notes to Financial Statements.
LEBENTHAL FUNDS, INC.
STATEMENTS OF CHANGES IN NET ASSETS
YEARS ENDED NOVEMBER 30, 1997 AND 1996
_______________________________________________________________________________
<TABLE>
<CAPTION>
LEBENTHAL NEW YORK MUNICIPAL LEBENTHAL NEW JERSEY MUNICIPAL
BOND FUND BOND FUND
------------------------------ ------------------------------
1997 1996 1997 1996
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment income $ 6,460,590 $ 5,915,750 $ 279,289 $ 230,070
Net realized gain (loss) on investments 1,262,317 967,689 28,867 (14,767)
Change in unrealized appreciation 2,368,635 177,568 153,909 48,013
Increase in net assets from operations 10,091,542 7,061,007 462,065 263,316
Dividends from net investment income (6,461,498)* (5,907,035) (279,289)* (230,070)
Capital share transactions (Note 4) 7,902,703 15,455,986 756,659 1,791,020
Capital contribution (Note 2) -- 422,268 -- --
Total increase 11,532,747 17,032,226 939,435 1,824,266
Net assets:
Beginning of year 122,611,313 105,579,087 5,182,149 3,357,883
End of year (1) $134,144,060 $122,611,313 $6,121,584 $5,182,149
(1) Includes Undistributed Net
Investment Income $ 8,544 $ 9,452 $ -- $ --
</TABLE>
(UNAUDITED INFORMATION)
* 99.36% and 98.43% designated as exempt interest dividends for federal income
tax purposes for New York Municipal Bond Fund and New Jersey Municipal Bond
Fund, respectively.
See Notes to Financial Statements.
LEBENTHAL FUNDS, INC.
STATEMENTS OF CHANGES IN NET ASSETS (CONTINUED)
YEARS ENDED NOVEMBER 30, 1997 AND 1996
_______________________________________________________________________________
LEBENTHAL TAXABLE MUNICIPAL
BOND FUND
-----------------------------
1997 1996
-------------- -------------
IINCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment income $ 1,010,769 $ 899,364
Net realized gain (loss) on investments 97,125 (222,798)
Change in unrealized appreciation 404,164 153,567
Increase in net assets from operations 1,512,058 830,133
Dividends from net investment income (1,010,769) (899,364)
Capital share transactions (Note 4) (114,600) 5,990,459
Total increase 386,689 5,921,228
Net assets:
Beginning of year 14,607,185 8,685,957
End of year (1) $14,993,874 $14,607,185
(1) Includes Undistributed Net
Investment Income $ -- $ --
See Notes to Financial Statements.
LEBENTHAL FUNDS, INC.
FINANCIAL HIGHLIGHTS
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD:
_______________________________________________________________________________
<TABLE>
<CAPTION>
LEBENTHAL NEW YORK
MUNICIPAL BOND FUND
---------------------------------------------------------------
YEAR ENDED NOVEMBER 30,
---------------------------------------------------------------
1997 1996 1995 1994# 1993
----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of period $8.09 $7.99 $6.84 $8.03 $7.54
Income from investment operations:
Net investment income 0.42 0.41 0.43 0.41 0.44
Net realized and unrealized gain (loss)
on investments 0.23 0.10 1.15 (1.15) 0.50
Total from investment operations 0.65 0.51 1.58 (0.74) 0.94
Less distributions:
Dividends from net investment income (0.42) (0.41) (0.43) (0.41) (0.44)
Distributions from net realized gain
on investments -- -- -- (0.04) (0.01)
Total distributions (0.42) (0.41) (0.43) (0.45) (0.45)
Net asset value, end of period $8.32 $8.09 $7.99 $6.84 $8.03
TOTAL RETURN
(without deduction of sales load) 8.27% 6.63%* 23.56% (9.62%) 12.63%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000) $134,144 $122,611 $105,579 $75,326 $80,727
Ratios to average net assets:
Expenses 0.89%** 1.09% 0.99% 0.64%## 0.20%##
Net investment income 5.16% 5.17% 5.63% 5.44% 5.42%
Portfolio turnover 60.80% 45.92% 148.88% 192.91% 7.88%
</TABLE>
# Effective August 15, 1994, the Investment Manager changed to Lebenthal
Asset Management, Inc.
## If the Investment Manager had not waived fees and reimbursed expenses and
the Administrator and Distributor had not waived fees, the ratio of operating
expenses to average net assets would have been 1.10%, and 1.12% for the periods
ended November 30, 1994, and 1993, respectively, for the New York Bond Fund.
* Includes the effect of a capital contribution from the Fund's Manager.
Without the capital contribution the total return would have been 6.24%.
** Includes fees paid indirectly of less than 0.01% for the New York Municipal
Bond Fund.
See Notes to Financial Statements.
LEBENTHAL FUNDS, INC.
FINANCIAL HIGHLIGHTS (CONTINUED)
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD:
_______________________________________________________________________________
<TABLE>
<CAPTION>
LEBENTHAL NEW JERSEY
MUNICIPAL BOND FUND
-------------------------------------------------
YEAR ENDED NOVEMBER 30,
-------------------------------------------------
1997 1996 1995 1994#*
----------- ----------- ----------- ----------
<S> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of period $6.74 $6.70 $5.95 $7.16
Income from investment operations:
Net investment income 0.35 0.36 0.36 0.32
Net realized and unrealized gain (loss)
on investments 0.23 0.04 0.75 (1.21)
Total from investment operations 0.58 0.40 1.11 (0.89)
Less distributions:
Dividends from net investment income (0.35) (0.36) (0.36) (0.32)
Net asset value, end of period $6.97 $6.74 $6.70 $5.95
TOTAL RETURN
(without deduction of sales load) 8.84% 6.18% 19.10% (12.70%)
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000) $6,122 $5,182 $3,358 $2,145
Ratios to average net assets:
Expenses ## 0.70%** 0.63%** 0.60% 0.60%
Net investment income 5.12% 5.37% 5.64% 4.97%
Portfolio turnover 57.19% 28.56% 61.69% 291.60%
</TABLE>
# Effective August 15, 1994, the Investment Manager changed to Lebenthal
Asset Management, Inc.
* Fund commenced operations on December 1, 1993.
## If the Investment Manager had not waived fees and reimbursed expenses and
the Administrator and Distributor had not waived fees, the ratio of operating
expenses to average net assets would have been 2.57%, 3.20%, 4.13%, and 4.83%
for the periods ended November 30, 1997, 1996, 1995 and 1994, respectively, for
the New Jersey Bond Fund.
** Includes fees paid indirectly of 0.02% and 0.03% for the New Jersey Bond
Fund, for 1997 and 1996, respectively.
See Notes to Financial Statements.
LEBENTHAL FUNDS, INC.
FINANCIAL HIGHLIGHTS (CONTINUED)
SELECTED DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD:
_______________________________________________________________________________
<TABLE>
<CAPTION>
LEBENTHAL TAXABLE
MUNICIPAL BOND FUND
----------------------------------------------------
YEAR ENDED NOVEMBER 30,
--------------------------------------------------
1997 1996 1995 1994#*
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of period $7.13 $7.22 $6.34 $7.16
Income from investment operations:
Net investment income 0.50 0.52 0.53 0.44
Net realized and unrealized gain (loss)
on investments 0.24 (0.09) 0.88 (0.82)
Total from investment operations 0.74 0.43 1.41 (0.38)
Less distributions:
Dividends from net investment income (0.50) (0.52) (0.53) (0.44)
Net asset value, end of period $7.37 $7.13 $7.22 $6.34
TOTAL RETURN
(without deduction of sales load) 10.89% 6.35% 23.11% (5.45%)
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000) $14,994 $14,607 $8,686 $2,990
Ratios to average net assets:
Expenses ## 0.79%** 0.61%** 0.60% 0.60%
Net investment income 7.06% 7.34% 7.57% 6.74%
Portfolio turnover 34.52% 44.46% 84.74% 93.73%
</TABLE>
# Effective August 15, 1994, the Investment Manager changed to Lebenthal
Asset Management, Inc.
* Fund commenced operations on December 1, 1993.
## If the Investment Manager had not waived fees and reimbursed expenses and
the Administrator and Distributor had not waived fees, the ratio of operating
expenses to average net assets would have been 1.42%, 1.63%, 2.59%, and 3.60%
for the periods ended November 30, 1997, 1996, 1995 and 1994, respectively, for
the Taxable Bond Fund.
** Includes fees paid indirectly of 0.01% for the Taxable Bond Fund.
See Notes to Financial Statements.
LEBENTHAL FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS
_______________________________________________________________________________
1. SUMMARY OF ACCOUNTING POLICIES
Lebenthal Funds, Inc. (the "Company") is registered under the Investment
Company Act of 1940 as an open-end management investment company consisting of
Lebenthal New York Municipal Bond Fund (the "New York Bond Fund"), Lebenthal
New Jersey Municipal Bond Fund (the "New Jersey Bond Fund") and Lebenthal
Taxable Municipal Bond Fund (the "Taxable Bond Fund") collectively, "The
Funds." Effective December 1, 1997, the New York Bond Fund began to offer a
second class of shares, Class B. Class B shares are sold without an initial
sales charge but will have a higher expense ratio than Class A shares due to
higher 12b-1 fees. These financial statements only contain information for the
operational Class A shares. The Company's financial statements are prepared in
accordance with generally accepted accounting principles as follows:
A) VALUATION OF SECURITIES -
Municipal obligations are stated on the basis of valuations provided by a
pricing service approved by the Board of Directors, which uses information with
respect to transactions in bonds, quotations from bond dealers, market
transactions in comparable securities and various relationships between
securities in determining value. If a pricing service is not used, municipal
obligations will be valued at quoted prices provided by municipal bond dealers.
Other securities for which transaction prices are readily available are stated
at market value (determined on the basis of the last reported sales price, or a
similar means). Short-term investments that will mature in sixty (60) days or
less are stated at amortized cost, which approximates market value. All other
securities and assets are valued at their fair market value as determined in
good faith by or under the direction of the Board of Directors.
B) FEDERAL INCOME TAXES -
It is the Funds' policy to comply with the requirements of the Internal Revenue
Code applicable to regulated investment companies and to distribute all of its
tax-exempt and taxable income to its shareholders. Therefore, no provision for
Federal income tax is required.
C) DIVIDENDS AND DISTRIBUTIONS -
Dividends from net investment income are declared daily and paid monthly.
Distributions of net capital gains, if any, realized on sales of investments,
are made after the close of the Funds' fiscal year, as declared by the Funds'
Board of Directors.
D) ORGANIZATIONAL EXPENSES -
Costs incurred in connection with the organization of each Fund and their
initial registration are amortized on a straight-line basis over a five-year
period from each Fund's commencement of operations.
E) GENERAL -
Securities transactions are recorded on a trade date basis. Realized gains and
losses from securities transactions are recorded on the identified cost basis.
Interest income is recorded on the accrual basis and dividend income is
recorded on the ex-dividend date. Premiums and original issue discounts on
securities purchased are amortized over the life of the respective securities.
LEBENTHAL FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
_______________________________________________________________________________
SUMMARY OF ACCOUNTING POLICIES (CONTINUED)
F) FEES PAID INDIRECTLY -
Funds leaving excess cash in demand deposit accounts may receive credits which
are available to offset custody expenses. The Statements of Operations report
gross custody expense, and reflect the amount of such credits as a reduction in
total expenses, of $3,231, $832, and $910, for the New York Bond Fund, New
Jersey Bond Fund, and Taxable Bond Fund, respectively.
G) ESTIMATES -
The preparation of financial statements in conformity with generally accepted
accounting principles requires the Funds to make estimates and assumptions that
affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of income and expense during the
reporting period. Actual results could differ from those estimates.
2. INVESTMENT MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES
Under the Management Contract the Funds pay a management fee to Lebenthal Asset
Management, Inc. (its Manager), equal to 0.25% of each Fund's average daily net
assets up to $50 million; 0.225% of such assets between $50 million and $100
million; and 0.20% of such assets in excess of $100 million. The Manager
manages the portfolio of securities of each Fund and makes decisions with
respect to the purchase and sale of investments. The Manager has agreed to
reimburse the Fund for its expenses (exclusive of interest, taxes, brokerage,
and extraordinary expenses) which in any year exceed the limits on investment
company expenses prescribed by any state in which the Fund's shares are
qualified for sale. For the year ended November 30, 1997, the Manager
voluntarily waived management fees of $13,639 and $35,804 for the New Jersey
Bond Fund and the Taxable Bond Fund, respectively. In addition, although not
required to do so, the Manager has agreed to reimburse expenses for the New
Jersey Bond Fund and the Taxable Bond Fund amounting to $74,043 and $17,513,
respectively.
Lebenthal & Co., Inc. retained commissions of $360,803 from the sales of shares
of the Company.
The Directors of the Company who are unaffiliated with the Manager or the
Distributor are paid $2,000 per annum plus $500 per meeting attended.
3. DISTRIBUTION PLAN
Pursuant to a Distribution Plan adopted under Rule 12b-1 of the Investment
Company Act of 1940, the Company and Lebenthal & Co., Inc. (the Distributor)
have entered into a Distribution Agreement. For its services under the
Distribution Agreement, the Distributor receives from each Fund a fee equal to
0.25% of the Fund's average daily net assets. For the year ended November 30,
1997, the Distributor voluntarily waived fees of $13,639 and $35,804 from the
New Jersey Bond Fund and the Taxable Bond Fund, respectively. There were no
additional expenses borne by the Company pursuant to the Distribution Plan.
LEBENTHAL FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
_______________________________________________________________________________
4. CAPITAL STOCK
At November 30, 1997, there were 20,000,000,000 shares of $0.001 par value
stock authorized. Transactions in capital stock were as follows:
LEBENTHAL NEW YORK LEBENTHAL NEW YORK
MUNICIPAL BOND FUND MUNICIPAL BOND FUND
YEAR ENDED YEAR ENDED
NOVEMBER 30, 1997 NOVEMBER 30, 1996
-------------------------- --------------------------
SHARES AMOUNT SHARES AMOUNT
----------- ------------- ----------- -------------
Sold 2,533,634 $ 20,632,289 3,470,847 $ 27,552,574
Issued as reinvestment
of dividends 704,599 5,693,051 665,870 5,256,989
Redeemed (2,274,159) (18,422,637) (2,196,989) (17,353,577)
Net increase 964,074 $ 7,902,703 1,939,728 $ 15,455,986
LEBENTHAL NEW JERSEY LEBENTHAL NEW JERSEY
MUNICIPAL BOND FUND MUNICIPAL BOND FUND
YEAR ENDED YEAR ENDED
NOVEMBER 30, 1997 NOVEMBER 30, 1996
-------------------------- --------------------------
SHARES AMOUNT SHARES AMOUNT
----------- ------------- ----------- -------------
Sold 198,467 $1,350,032 392,200 $ 2,608,455
Issued as reinvestment
of dividends 34,595 234,078 31,934 211,384
Redeemed (123,178) (827,451) (156,189) (1,028,819)
Net increase 109,884 $ 756,659 267,945 $ 1,791,020
LEBENTHAL TAXABLE LEBENTHAL TAXABLE
MUNICIPAL BOND FUND MUNICIPAL BOND FUND
YEAR ENDED YEAR ENDED
NOVEMBER 30, 1997 NOVEMBER 30, 1996
-------------------------- --------------------------
SHARES AMOUNT SHARES AMOUNT
----------- ------------- ----------- -------------
Sold 399,620 $ 2,813,420 1,164,585 $ 8,169,453
Issued as reinvestment
of dividends 99,357 698,549 102,059 708,161
Redeemed (514,463) (3,626,569) (420,759) (2,887,155)
Net increase/(decrease) (15,486) $ (114,600) 845,885 $ 5,990,459
LEBENTHAL FUNDS, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
_______________________________________________________________________________
5. INVESTMENT TRANSACTIONS
Purchases of investment securities for the New York Bond Fund, the New Jersey
Bond Fund, and the Taxable Bond Fund, other than short term debt obligations
and government securities having maturities of one year or less, were
$92,198,960, $4,005,286, and $5,268,082, respectively. Sales of investment
securities for the New York Bond Fund, the New Jersey Bond Fund, and the
Taxable Bond Fund, other than short term obligations, were $75,999,323,
$3,039,525, and $4,878,362, respectively.
6. FEDERAL INCOME TAXES
Tax basis capital losses which may be carried forward to offset future capital
gains through November 30, 2004 amounted to $658,345 (maturing November 30,
2001), $264,623 ($249,856 and $14,767 maturing November 30, 2001 and November
30, 2004, respectively) and $353,362 ($130,361 and 223,001 maturing November
30, 2001 and November 30, 2004, respectively), for the New York Bond Fund, the
New Jersey Bond Fund, and the Taxable Bond Fund, respectively.
7. CONCENTRATION OF CREDIT RISK
The New York Bond Fund invests primarily in obligations of political
subdivisions of the state of New York and the New Jersey Bond Fund invests
primarily in obligations of political subdivisions of the state of New Jersey
and accordingly these funds are subject to the risk associated with the
non-performance of such issuers. Each Fund maintains a policy of monitoring its
exposure by reviewing the creditworthiness of the issuers, as well as that of
financial institutions issuing letters of credit, and by limiting the amount of
holdings with letters of credit from one financial institution.
LEBENTHAL FUNDS, INC.
INDEPENDENT AUDITOR'S REPORT
_______________________________________________________________________________
TO THE BOARD OF DIRECTORS AND SHAREHOLDERS OF THE
LEBENTHAL FUNDS, INC.
We have audited the accompanying statement of assets and liabilities, including
the schedule of investments, of Lebenthal New York Municipal Bond Fund,
Lebenthal New Jersey Municipal Bond Fund and Lebenthal Taxable Municipal Bond
Fund (three of the Funds comprising the Lebenthal Funds, Inc.) as of November
30, 1997, and the related statement of operations, statement of changes in net
assets, and the financial highlights for the year then ended. 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. The statements of
changes in net assets for year ended November 30, 1996 for each of the Funds
and the financial highlights for each of the four years in the period ended
November 30, 1996 for the Lebenthal New York Municipal Bond Fund and each of
the three years in the period ended November 30, 1996 for the Lebenthal New
Jersey Municipal Bond Fund and the Lebenthal Taxable Municipal Bond Fund, were
audited by other auditors, whose report, dated January 10, 1997, expressed an
unqualified opinion on those statements.
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
November 30, 1997 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 the
Lebenthal New York Municipal Bond Fund, Lebenthal New Jersey Municipal Bond
Fund and Lebenthal Taxable Municipal Bond Fund, series of Lebenthal Funds,
Inc., as of November 30, 1997, the results of their operations, the changes in
their net assets, and the financial highlights for the year then ended, in
conformity with generally accepted accounting principles.
Coopers & Lybrand L.L.P.
Kansas City, Missouri
January 14, 1998
This report is submitted for the general information of the shareholders of the
Fund. It is not authorized for distribution to prospective investors in the
Fund unless preceded or accompanied by an effective prospectus, which includes
information regarding the Fund's objectives and policies, experience of its
management, marketability of shares, and other information.
LEBENTHAL FUNDS, INC.
120 Broadway
New York, New York 10271
(212) 425-6116
DISTRIBUTOR AND
SHAREHOLDER SERVICING AGENT
Lebenthal & Co., Inc.
120 Broadway
New York, New York 10271
120 BROADWAY, NEW YORK, NY 10271
(212) 425-6116
OUTSIDE OF NYC 1-800-221-5822
THE WORKHORSE OF INVESTMENTS.
