<PAGE> PAGE 1
000 A000000 03/31/97
000 C000000 0000893226
000 D000000 N
000 E000000 NF
000 F000000 Y
000 G000000 N
000 H000000 N
000 I000000 3.0
000 J000000 U
001 A000000 FRANKLIN STRATEGIC MORTGAGE PORTFOLIO
001 B000000 811-7288
001 C000000 4153122000
002 A000000 777 MARINERS ISLAND BOULEVARD
002 B000000 SAN MATEO
002 C000000 CA
002 D010000 94403
002 D020000 7777
003 000000 N
004 000000 N
005 000000 N
006 000000 N
007 A000000 Y
007 B000000 1
007 C010100 1
007 C020100 FRANKLIN STRATEGIC MORTGAGE PORTFOLIO
007 C030100 N
007 C010200 2
007 C010300 3
007 C010400 4
007 C010500 5
007 C010600 6
007 C010700 7
007 C010800 8
007 C010900 9
007 C011000 10
008 A00AA01 FRANKLIN INSTITUTIONAL SERVICES CORPORATION
008 B00AA01 A
008 C00AA01 801-40142
008 D01AA01 SAN MATEO
008 D02AA01 CA
008 D03AA01 94403
008 D04AA01 7777
010 A00AA01 FT SERVICES, INC.
010 B00AA01 00000
010 C01AA01 SAN MATEO
010 C02AA01 CA
010 C03AA01 94403
010 C04AA01 7777
011 A00AA01 FRANKLIN/TEMPLETON DISTRIBUTORS, INC.
011 B00AA01 8-5889
011 C01AA01 SAN MATEO
<PAGE> PAGE 2
011 C02AA01 CA
011 C03AA01 94403
011 C04AA01 7777
012 A00AA01 FRANKLIN/TEMPLETON INVESTOR SERVICES, INC.
012 B00AA01 84-1036
012 C01AA01 SAN MATEO
012 C02AA01 CA
012 C03AA01 94403
012 C04AA01 7777
013 A00AA01 COOPERS & LYBRAND L.L.P.
013 B01AA01 SAN FRANCISCO
013 B02AA01 CA
013 B03AA01 94105
013 B04AA01 2119
014 A00AA01 FRANKLIN/TEMPLETON DISTRIBUTORS, INC.
014 B00AA01 8-5889
015 A00AA01 THE BANK OF NEW YORK
015 B00AA01 C
015 C01AA01 NEW YORK
015 C02AA01 NY
015 C03AA01 10286
015 E01AA01 X
015 A00AA02 JASDEC
015 B00AA02 S
015 C01AA02 TOKYO
015 D01AA02 JAPAN
015 E04AA02 X
015 A00AA03 CEDEL (EUROMARKET)
015 B00AA03 S
015 C01AA03 LUXEMBOURG CITY
015 D01AA03 LUXEMBOURG
015 E04AA03 X
015 A00AA04 THE BANK OF BOSTON
015 B00AA04 S
015 C01AA04 BUENOS AIRES
015 D01AA04 ARGENTINA
015 E04AA04 X
015 A00AA05 AUSTRALIA AND NEW ZEALAND BANKING GROUP LTD.
015 B00AA05 S
015 C01AA05 MELBOURNE
015 D01AA05 AUSTRALIA
015 E04AA05 X
015 A00AA06 CREDITANSTALT BANKVEREIN
015 B00AA06 S
015 C01AA06 VIENNA
015 D01AA06 AUSTRIA
015 E04AA06 X
015 A00AA07 STANDARD CHARTERED BANK PLC
015 B00AA07 S
015 C01AA07 DHAKA
015 D01AA07 BANGLADESH
<PAGE> PAGE 3
015 E04AA07 X
015 A00AA08 BANQUE BRUXELLES LAMBERT
015 B00AA08 S
015 C01AA08 BRUSSELS
015 D01AA08 BELGIUM
015 E04AA08 X
015 A00AA09 THE FIRST NATIONAL BANK OF BOSTON
015 B00AA09 S
015 C01AA09 SAN PAULO
015 D01AA09 BRAZIL
015 E04AA09 X
015 A00AA10 ROYAL BANK OF CANADA
015 B00AA10 S
015 C01AA10 MONTREAL
015 D01AA10 CANADA
015 E04AA10 X
015 A00AA11 THE STANDARD CHARTERED BANK
015 B00AA11 S
015 C01AA11 HONG KONG
015 D01AA11 CHINA
015 E04AA11 X
015 A00AA12 DEVELOPMENT BANK OF SINGAPORE
015 B00AA12 S
015 C01AA12 SINGAPORE
015 D01AA12 SINGAPORE
015 E04AA12 X
015 A00AA13 CITIBANK, N.A. VIA CITITRUST COLUMBIA S.A.
015 B00AA13 S
015 C01AA13 BOGOTA
015 D01AA13 COLOMBIA
015 E04AA13 X
015 A00AA14 THE FIRST NATIONAL BANK OF BOSTON
015 B00AA14 S
015 C01AA14 SANTIAGO
015 D01AA14 CHILE
015 E04AA14 X
015 A00AA15 DEN DANSKE BANK
015 B00AA15 S
015 C01AA15 COPENHAGEN
015 D01AA15 DENMARK
015 E04AA15 X
015 A00AA16 BANQUE INTERNATIONALE A LUXEMBOURG
015 B00AA16 S
015 C01AA16 LUXEMBOURG CITY
015 D01AA16 LUXEMBOURG
015 E04AA16 X
015 A00AA17 THE BANK OF NEW YORK
015 B00AA17 S
015 C01AA17 LONDON
015 D01AA17 UNITED KINGDOM
015 E04AA17 X
<PAGE> PAGE 4
015 A00AA18 MERITA BANK LTD.
015 B00AA18 S
015 C01AA18 HELSINKI
015 D01AA18 FINLAND
015 E04AA18 X
015 A00AA19 BANQUE PARIBAS
015 B00AA19 S
015 C01AA19 PARIS
015 D01AA19 FRANCE
015 E04AA19 X
015 A00AA20 DRESDNER BANK AG
015 B00AA20 S
015 C01AA20 FRANKFURT/MAIN
015 D01AA20 GERMANY
015 E04AA20 X
015 A00AA21 NATIONAL BANK OF GREECE SA
015 B00AA21 S
015 C01AA21 ATHENS
015 D01AA21 GREECE
015 E04AA21 X
015 A00AA22 THE HONGKONG AND SHANGHAI BANKING CORP. LTD.
015 B00AA22 S
015 C01AA22 HONG KONG
015 D01AA22 HONG KONG
015 E04AA22 X
015 A00AA23 CITIBANK, N.A.
015 B00AA23 S
015 C01AA23 BUDAPEST
015 D01AA23 HUNGARY
015 E04AA23 X
015 A00AA24 THE HONGKONG AND SHANGHAI BANKING CORP. LTD.
015 B00AA24 S
015 C01AA24 MUMBAI
015 D01AA24 INDIA
015 E04AA24 X
015 A00AA25 THE HONGKONG AND SHANGHAI BANKING CORP. LTD.
015 B00AA25 S
015 C01AA25 JAKARTA
015 D01AA25 INDONESIA
015 E04AA25 X
015 A00AA26 ALLIED IRISH BANKS, PLC
015 B00AA26 S
015 C01AA26 DUBLIN
015 D01AA26 IRELAND
015 E04AA26 X
015 A00AA27 BANK LEUMI LE-ISRAEL B.M.
015 B00AA27 S
015 C01AA27 TEL AVIV
015 D01AA27 ISRAEL
015 E04AA27 X
015 A00AA28 BANCA COMMERCIALE ITALIANA
<PAGE> PAGE 5
015 B00AA28 S
015 C01AA28 MILAN
015 D01AA28 ITALY
015 E04AA28 X
015 A00AA29 BANK OF TOKYO MITSUBISHI
015 B00AA29 S
015 C01AA29 TOKYO
015 D01AA29 JAPAN
015 E04AA29 X
015 A00AA30 THE HONGKONG BANK MALAYSIA BERHAD
015 B00AA30 S
015 C01AA30 KUALA LUMPUR
015 D01AA30 MALAYSIA
015 E04AA30 X
015 A00AA31 BANCO NACIONAL DE MEXICO
015 B00AA31 S
015 C01AA31 MEXICO CITY
015 D01AA31 MEXICO
015 E04AA31 X
015 A00AA32 MEESPIERSON
015 B00AA32 S
015 C01AA32 AMSTERDAM
015 D01AA32 NETHERLANDS
015 E04AA32 X
015 A00AA33 AUSTRALIA AND NEW ZEALAND BANKING GROUP LTD.
015 B00AA33 S
015 C01AA33 WELLINGTON
015 D01AA33 NEW ZEALAND
015 E04AA33 X
015 A00AA34 DEN NORSKE BANK A.S.
015 B00AA34 S
015 C01AA34 OSLO
015 D01AA34 NORWAY
015 E04AA34 X
015 A00AA35 STANDARD CHARTERED BANK
015 B00AA35 S
015 C01AA35 KARACHI
015 D01AA35 PAKISTAN
015 E04AA35 X
015 A00AA36 CITIBANK, N.A.
015 B00AA36 S
015 C01AA36 LIMA
015 D01AA36 PERU
015 E04AA36 X
015 A00AA37 THE HONGKONG AND SHANGHAI BANKING CORP. LTD.
015 B00AA37 S
015 C01AA37 PASIG CITY MANILA
015 D01AA37 PHILIPPINES
015 E04AA37 X
015 A00AA38 BANK HANDLOWY W WARSZAWIE S.A.
015 B00AA38 S
<PAGE> PAGE 6
015 C01AA38 WARSAW
015 D01AA38 POLAND
015 E04AA38 X
015 A00AA39 BANCO COMERCIAL PORTUGUES, S.A.
015 B00AA39 S
015 C01AA39 LISBON
015 D01AA39 PORTUGAL
015 E04AA39 X
015 A00AA40 UNITED OVERSEAS BANK LIMITED
015 B00AA40 S
015 C01AA40 SINGAPORE
015 D01AA40 SINGAPORE
015 E04AA40 X
015 A00AA41 STANDARD CORPORATE AND MERCHANT BANK
015 B00AA41 S
015 C01AA41 JOHANNESBURG
015 D01AA41 SOUTH AFRICA
015 E04AA41 X
015 A00AA42 SEOULBANK
015 B00AA42 S
015 C01AA42 SEOUL
015 D01AA42 SOUTH KOREA
015 E04AA42 X
015 A00AA43 BANCO BILBAO VIZCAYA
015 B00AA43 S
015 C01AA43 MADRID
015 D01AA43 SPAIN
015 E04AA43 X
015 A00AA44 STANDARD CHARTERED BANK
015 B00AA44 S
015 C01AA44 COLOMBO
015 D01AA44 SRI LANKA
015 E04AA44 X
015 A00AA45 SKANDINAVISKA ENSKILDA BANKEN
015 B00AA45 S
015 C01AA45 STOCKHOLM
015 D01AA45 SWEDEN
015 E04AA45 X
015 A00AA46 UNION BANK OF SWITZERLAND
015 B00AA46 S
015 C01AA46 ZURICH
015 D01AA46 SWITZERLAND
015 E04AA46 X
015 A00AA47 THE HONGKONG AND SHANGHAI BANKING CORP. LTD.
015 B00AA47 S
015 C01AA47 TAIPEI
015 D01AA47 TAIWAN (REP. CHINA)
015 E04AA47 X
015 A00AA48 THE SIAM COMMERCIAL BANK PUBLIC COMPANY LTD.
015 B00AA48 S
015 C01AA48 BANGKOK
<PAGE> PAGE 7
015 D01AA48 THAILAND
015 E04AA48 X
015 A00AA49 CITIBANK, N.A.
015 B00AA49 S
015 C01AA49 ISTANBUL
015 D01AA49 TURKEY
015 E04AA49 X
015 A00AA50 FIRST CHICAGO CLEARING CENTER (EUROMARKET)
015 B00AA50 S
015 C01AA50 LONDON
015 D01AA50 UNITED KINGDOM
015 E04AA50 X
015 A00AA51 CITIBANK, N.A.
015 B00AA51 S
015 C01AA51 CARACAS
015 D01AA51 VENEZUELA
015 E04AA51 X
015 A00AA52 BANCO DE CHILE
015 B00AA52 S
015 C01AA52 SANTIAGO
015 D01AA52 CHILE
015 E04AA52 X
015 A00AA53 CESKOSLOVENSKA OBCHODNI BANKA (CSOB)
015 B00AA53 S
015 C01AA53 PRAHA
015 D01AA53 CZECH REPUBLIC
015 E04AA53 X
015 A00AA54 BANQUE COMMERCIALE DU MAROC (BCM)
015 B00AA54 S
015 C01AA54 CASABLANCA
015 D01AA54 MOROCCO
015 E04AA54 X
015 A00AA55 THE FIRST NATIONAL BANK OF BOSTON
015 B00AA55 S
015 C01AA55 MONTEVIDEO
015 D01AA55 URUGUAY
015 E04AA55 X
015 A00AA56 STANBIC BANK BOTSWANA LTD.
015 B00AA56 S
015 C01AA56 GABARONE
015 D01AA56 BOTSWANA
015 E04AA56 X
015 A00AA57 CITIBANK, N.A.
015 B00AA57 S
015 C01AA57 QUITO
015 D01AA57 ECUADOR
015 E04AA57 X
015 A00AA58 CITIBANK, N.A.
015 B00AA58 S
015 C01AA58 CAIRO
015 D01AA58 EGYPT
<PAGE> PAGE 8
015 E04AA58 X
015 A00AA59 MERCHANT BANK (GHANA) LTD.
015 B00AA59 S
015 C01AA59 ACCRA
015 D01AA59 GHANA
015 E04AA59 X
015 A00AA60 THE BRITISH BANK OF THE MIDDLE EAST
015 B00AA60 S
015 C01AA60 AMMAN
015 D01AA60 JORDAN
015 E04AA60 X
015 A00AA61 STANBIC BANK KENYA LTD.
015 B00AA61 S
015 C01AA61 NAIROBI
015 D01AA61 KENYA
015 E04AA61 X
015 A00AA62 STANBIC BANK NAMBIA LTD.
015 B00AA62 S
015 C01AA62 WINDHOEK
015 D01AA62 NAMIBIA
015 E04AA62 X
015 A00AA63 STANBIC MERCHANT BANK NIGERIA LTD.
015 B00AA63 S
015 C01AA63 LAGOS
015 D01AA63 NIGERIA
015 E04AA63 X
015 A00AA64 CREDIT SUISSE (MOSCOW) LTD.
015 B00AA64 S
015 C01AA64 MOSCOW
015 D01AA64 RUSSIA
015 E04AA64 X
015 A00AA65 BANQUE PARIBAS SA
015 B00AA65 S
015 C01AA65 MILAN
015 D01AA65 ITALY
015 E04AA65 X
015 A00AA66 STANBIC BANK SWAILAND LTD.
015 B00AA66 S
015 C01AA66 MBABANE
015 D01AA66 SWAZILAND
015 E04AA66 X
015 A00AA67 STANBIC BANK ZAMBIA LTD.
015 B00AA67 S
015 C01AA67 LUSAKA
015 D01AA67 ZAMBIA
015 E04AA67 X
015 A00AA68 STANBIC BANK ZIMBABWE LTD.
015 B00AA68 S
015 C01AA68 HARARE
015 D01AA68 ZIMBABWE
015 E04AA68 X
<PAGE> PAGE 9
015 A00AA69 CREDIT COMMERCIAL DE FRANCE
015 B00AA69 S
015 C01AA69 PARIS
015 D01AA69 FRANCE
015 E04AA69 X
015 A00AA70 KAS-ASSOCIATIE NV
015 B00AA70 S
015 C01AA70 AMSTERDAM
015 D01AA70 NETHERLANDS
015 E04AA70 X
015 A00AA71 BANK LEU LTD.
015 B00AA71 S
015 C01AA71 ZURICH
015 D01AA71 SWITZERLAND
015 E04AA71 X
015 A00AA72 BANGKOK BANK PUBLIC COMPANY LTD.
015 B00AA72 S
015 C01AA72 BANGKOK
015 D01AA72 THAILAND
015 E04AA72 X
015 A00AA73 BANK OF AMERICA NT & SA
015 B00AA73 C
015 C01AA73 SAN FRANCISCO
015 C02AA73 CA
015 C03AA73 94104
015 E01AA73 X
015 A00AA74 CITIBANK DELAWARE
015 B00AA74 C
015 C01AA74 NEW CASTLE
015 C02AA74 DE
015 C03AA74 19720
015 C04AA74 2409
015 E01AA74 X
018 00AA00 Y
019 A00AA00 Y
019 B00AA00 206
019 C00AA00 FRNKTEMGRP
020 C000001 0
020 C000002 0
020 C000003 0
020 C000004 0
020 C000005 0
020 C000006 0
020 C000007 0
020 C000008 0
020 C000009 0
020 C000010 0
021 000000 0
022 A000001 SBCI SWISS BANK CORP INV BANK
022 B000001 13-2639550
022 C000001 7490
<PAGE> PAGE 10
022 D000001 0
022 A000002 DAIWA SECURITIES AMERICA INC.
022 B000002 13-5680329
022 C000002 6223
022 D000002 0
022 A000003 FUJI SECURITIES INC.
022 B000003 13-3038090
022 C000003 6138
022 D000003 0
022 A000004 UBS SECURITIES INC.
022 B000004 13-2932996
022 C000004 5096
022 D000004 0
022 A000005 DONALDSON LUFKIN & JENRETTE
022 B000005 13-2741729
022 C000005 5032
022 D000005 0
022 A000006 BEAR, STEARNS & CO., INC.
022 B000006 13-3299429
022 C000006 4918
022 D000006 99
022 A000007 BANKERS TRUST CO.
022 B000007 13-4941247
022 C000007 4426
022 D000007 0
022 A000008 BANK OF AMERICA NT & SA
022 B000008 94-1687665
022 C000008 4045
022 D000008 0
022 A000009 LEHMAN BROTHERS SECS
022 B000009 13-2518466
022 C000009 2879
022 D000009 0
022 A000010 NIKKO SECURITIES CO INTL, INC.
022 B000010 94-1302123
022 C000010 2845
022 D000010 0
023 C000000 51374
023 D000000 99
024 00AA00 N
025 D00AA01 0
025 D00AA02 0
025 D00AA03 0
025 D00AA04 0
025 D00AA05 0
025 D00AA06 0
025 D00AA07 0
025 D00AA08 0
026 A000000 Y
026 B000000 Y
026 C000000 Y
<PAGE> PAGE 11
026 D000000 Y
026 E000000 N
026 F000000 N
026 G010000 N
026 G020000 N
026 H000000 N
027 000000 Y
028 A01AA00 82
028 A02AA00 40
028 A03AA00 0
028 A04AA00 97
028 B01AA00 5
028 B02AA00 40
028 B03AA00 0
028 B04AA00 0
028 C01AA00 20
028 C02AA00 43
028 C03AA00 0
028 C04AA00 0
028 D01AA00 25
028 D02AA00 41
028 D03AA00 0
028 D04AA00 0
028 E01AA00 0
028 E02AA00 41
028 E03AA00 0
028 E04AA00 7
028 F01AA00 133
028 F02AA00 46
028 F03AA00 0
028 F04AA00 11
028 G01AA00 265
028 G02AA00 251
028 G03AA00 0
028 G04AA00 115
028 H00AA00 265
029 00AA00 Y
030 A00AA00 2
030 B00AA00 4.25
030 C00AA00 0.00
031 A00AA00 0
031 B00AA00 0
032 00AA00 2
033 00AA00 0
034 00AA00 N
035 00AA00 0
036 B00AA00 0
037 00AA00 N
038 00AA00 0
039 00AA00 Y
040 00AA00 N
<PAGE> PAGE 12
041 00AA00 N
042 A00AA00 0
042 B00AA00 0
042 C00AA00 0
042 D00AA00 0
042 E00AA00 0
042 F00AA00 0
042 G00AA00 0
042 H00AA00 0
043 00AA00 0
044 00AA00 0
045 00AA00 Y
046 00AA00 N
047 00AA00 Y
048 00AA00 0.000
048 A01AA00 250000
048 A02AA00 0.400
048 B01AA00 250000
048 B02AA00 0.380
048 C01AA00 0
048 C02AA00 0.000
048 D01AA00 0
048 D02AA00 0.000
048 E01AA00 0
048 E02AA00 0.000
048 F01AA00 0
048 F02AA00 0.000
048 G01AA00 0
048 G02AA00 0.000
048 H01AA00 0
048 H02AA00 0.000
048 I01AA00 0
048 I02AA00 0.000
048 J01AA00 0
048 J02AA00 0.000
048 K01AA00 500000
048 K02AA00 0.360
049 00AA00 N
050 00AA00 N
051 00AA00 N
052 00AA00 N
053 A00AA00 Y
053 B00AA00 Y
053 C00AA00 N
054 A00AA00 Y
054 B00AA00 Y
054 C00AA00 Y
054 D00AA00 Y
054 E00AA00 Y
054 F00AA00 Y
054 G00AA00 Y
<PAGE> PAGE 13
054 H00AA00 Y
054 I00AA00 N
054 J00AA00 Y
054 K00AA00 Y
054 L00AA00 Y
054 M00AA00 Y
054 N00AA00 Y
054 O00AA00 Y
055 A00AA00 Y
055 B00AA00 N
056 00AA00 Y
057 00AA00 N
058 A00AA00 N
059 00AA00 Y
060 A00AA00 Y
060 B00AA00 Y
061 00AA00 100
062 A00AA00 Y
062 B00AA00 0.0
062 C00AA00 0.0
062 D00AA00 8.9
062 E00AA00 0.0
062 F00AA00 0.0
062 G00AA00 0.0
062 H00AA00 0.0
062 I00AA00 0.0
062 J00AA00 0.0
062 K00AA00 0.0
062 L00AA00 0.0
062 M00AA00 0.0
062 N00AA00 91.6
062 O00AA00 0.0
062 P00AA00 0.0
062 Q00AA00 0.0
062 R00AA00 0.0
063 A00AA00 0
063 B00AA00 21.7
064 A00AA00 Y
064 B00AA00 N
066 A00AA00 N
067 00AA00 N
068 A00AA00 N
068 B00AA00 N
069 00AA00 N
070 A01AA00 Y
070 A02AA00 Y
070 B01AA00 N
070 B02AA00 N
070 C01AA00 N
070 C02AA00 N
070 D01AA00 N
<PAGE> PAGE 14
070 D02AA00 N
070 E01AA00 N
070 E02AA00 N
070 F01AA00 N
070 F02AA00 N
070 G01AA00 Y
070 G02AA00 N
070 H01AA00 N
070 H02AA00 N
070 I01AA00 N
070 I02AA00 N
070 J01AA00 N
070 J02AA00 N
070 K01AA00 Y
070 K02AA00 N
070 L01AA00 N
070 L02AA00 N
070 M01AA00 N
070 M02AA00 N
070 N01AA00 Y
070 N02AA00 N
070 O01AA00 Y
070 O02AA00 N
070 P01AA00 Y
070 P02AA00 N
070 Q01AA00 N
070 Q02AA00 N
070 R01AA00 N
070 R02AA00 N
071 A00AA00 375
071 B00AA00 327
071 C00AA00 6675
071 D00AA00 5
072 A00AA00 6
072 B00AA00 257
072 C00AA00 0
072 D00AA00 0
072 E00AA00 0
072 F00AA00 14
072 G00AA00 0
072 H00AA00 0
072 I00AA00 0
072 J00AA00 0
072 K00AA00 0
072 L00AA00 4
072 M00AA00 0
072 N00AA00 11
072 O00AA00 0
072 P00AA00 0
072 Q00AA00 0
072 R00AA00 6
<PAGE> PAGE 15
072 S00AA00 1
072 T00AA00 0
072 U00AA00 1
072 V00AA00 0
072 W00AA00 1
072 X00AA00 38
072 Y00AA00 38
072 Z00AA00 257
072AA00AA00 0
072BB00AA00 0
072CC01AA00 0
072CC02AA00 20
072DD01AA00 257
072DD02AA00 0
072EE00AA00 0
073 A01AA00 0.3600
073 A02AA00 0.0000
073 B00AA00 0.0000
073 C00AA00 0.0000
074 A00AA00 0
074 B00AA00 641
074 C00AA00 0
074 D00AA00 6626
074 E00AA00 0
074 F00AA00 0
074 G00AA00 0
074 H00AA00 0
074 I00AA00 0
074 J00AA00 1
074 K00AA00 0
074 L00AA00 61
074 M00AA00 1
074 N00AA00 7329
074 O00AA00 99
074 P00AA00 0
074 Q00AA00 0
074 R01AA00 0
074 R02AA00 0
074 R03AA00 0
074 R04AA00 1
074 S00AA00 0
074 T00AA00 7229
074 U01AA00 744
074 U02AA00 0
074 V01AA00 9.72
074 V02AA00 0.00
074 W00AA00 0.0000
074 X00AA00 69
074 Y00AA00 1151
075 A00AA00 0
075 B00AA00 7052
<PAGE> PAGE 16
076 00AA00 0.00
077 A000000 N
078 000000 N
080 A00AA00 ICI MUTUAL INSURANCE COMPANY
080 B00AA00 NONE
080 C00AA00 0
081 B00AA00 0
082 B00AA00 0
083 B00AA00 0
084 B00AA00 0
086 A010000 0
086 A020000 0
086 B010000 0
086 B020000 0
086 C010000 0
086 C020000 0
086 D010000 0
086 D020000 0
086 E010000 0
086 E020000 0
086 F010000 0
086 F020000 0
SIGNATURE D. LOO-TAM
TITLE TREASURER
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FRANKLIN STRATEGIC MORTGAGE PORTFOLIO MARCH 31, 1997 SEMI-ANNUAL REPORT
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000893226
<NAME> FRANKLIN STRATEGIC MORTGAGE PORTFOLIO
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-30-1997
<PERIOD-END> MAR-31-1997
<INVESTMENTS-AT-COST> 6,598,357
<INVESTMENTS-AT-VALUE> 6,625,935
<RECEIVABLES> 702,698
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 7,328,633
<PAYABLE-FOR-SECURITIES> 98,917
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 1,077
<TOTAL-LIABILITIES> 99,994
<SENIOR-EQUITY> 0
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<NUMBER-OF-SHARES-REDEEMED> (11,689)
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</TABLE>
