-----------------------------------------------
GREENWICH STREET
MUNICIPAL FUND INC.
-----------------------------------------------
[GRAPHIC OMITTED]
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SEMI-ANNUAL REPORT
November 30, 1997
<PAGE>
Greenwich Street Municipal
Fund Inc.
- --------------------------------------------------------------------------------
November 30, 1997
- --------------------------------------------------------------------------------
Dear Shareholder:
We are pleased to provide the semi-annual report for the Greenwich Street
Municipal Fund Inc. ("Fund") for the six months ended November 30, 1997. During
the past six months, the Fund distributed income dividends totaling $0.348 per
share. The table below shows the annualized distribution rate and six-month
total return based on the Fund's November 30, 1997 net asset value ("NAV") per
share and its New York Stock Exchange ("NYSE") closing price:
Price Annualized Six-Month
Per Share Distribution Rate* Total Return
--------- ------------------ ------------
$11.93 (NAV) 5.63% 6.06%
$11.25 (NYSE) 5.97% 1.91%
In comparison, closed-end municipal bond funds posted an average total
return of 6.28% based on NAV for the same time period, as reported by Lipper
Analytical Services, Inc. (Lipper is a major fund-tracking organization.)
Market Update and Portfolio Strategy
The municipal bond market is in the midst of a powerful rally that began
in early spring. Yet municipal bonds have not rallied quite as much as
government bonds because this fall has seen a prolific issuance of refunding
issues. All of this simply means that municipals are very attractive on an
after-tax basis compared to government bonds at this time. We have therefore
been fully invested with an emphasis on high-quality issues because
- ----------
* This distribution assumes monthly dividends at the current rate of $0.056
per share for twelve months.
=================================== 1 ==================================
<PAGE>
of the little yield pick-up available from lower-rated issues. We tend to be
value-oriented investors and quality in our view is coming at a small premium
over BAA and lower-rated credits.
The powerful rally in municipals has created some very interesting
investment opportunities. The long maturities in our marketplace are priced
almost even with maturities that are considerably shorter. If we can maintain
our coupon income yet take much less interest rate risk, we are delighted to do
so. As long as the yield curve stays this "flat," we will continue to maintain a
high grade profile, and also seek to lessen our interest rate volatility in
today's lower interest-rate environment. We have been waiting for this market
opportunity for a while. Consistent with one of our key investment strategies
after large rallies, we tend to shorten up maturities a lot; after large
declines, we become more aggressive.
Fund's Investment Strategy
During the past six months, the Greenwich Street Municipals Fund Inc.
focused on hospital bonds (about 22% of Portfolio), water and sewer bonds (14%
of Portfolio) and transportation bonds (13% of Portfolio) because we believe
they offered good relative values. At the end of November, the Fund's weighted
average maturity was approximately 23 years. In addition, as of November 30,
1997, approximately 94% of the Fund's holdings were rated investment grade by
either Standard & Poor's Corporation or Moody's Investors Services Inc., with
62% of the Fund invested in AAA bonds, the highest possible rating.
(Investment-grade bonds are those rated AAA, AA, A and Baa by Moody's Investors
Service, Inc. or AAA, AA, A and BBB by Standard & Poor's Ratings Services, or
have an equivalent rating by any nationally recognized statistical rating
organization, or determined by the manager to be of equivalent quality.)
Municipal Bond Market Outlook
The fundamental outlook for bonds is quite good. The U.S. economy
continues to produce healthy results without fanning the flames of inflation.
And while inflation remains extremely low, with economic uncertainty prevalent
in Southeast Asia, we expect it to stay that way for the next several quarters.
Federal Reserve Board monetary policy appears to be on hold for the moment, and
tax-exempt bonds are in decent supply and are attractively priced. All of those
factors should add up to a favorable municipal bond market over the next quarter
or two. While we remain committed to our conservative investment strategy,
discipline will be the main determinant of your Fund's maturity structure.
=================================== 2 ==================================
<PAGE>
In closing, thank you for investing in the Greenwich Street Municipals
Fund Inc. We look forward to continuing to help you pursue your financial goals.
Sincerely,
/s/ Heath B. McLendon /s/ J.P. Deane
- --------------------- --------------
Heath B. McLendon Joseph P. Deane
Chairman Vice President and
Investment Officer
December 18, 1997
=================================== 3 ==================================
<PAGE>
- --------------------------------------------------------------------------------
Schedule of Investments
November 30, 1997 (unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Face
Amount Rating Security Value
====================================================================================
- ------------------------------------------------------------------------------------
Municipal Bonds and Notes -- 100.0%
- -----------------------------------
<C> <C> <S> <C>
California -- 12.1%
Anaheim CA, Public Finance Authority Lease
Revenue, Public Improvements, Series A,
FSA-Insured:
$3,600,000 AAA 5.000% due 9/1/27 $ 3,465,000
2,500,000 AAA 5.000% due 3/1/37 2,371,875
1,000,000 AAA California State Public Works Board Lease
Revenue, Department of Corrections,
Series A, AMBAC-Insured,
5.250% due 1/1/21 991,250
1,980,000 AAA California State University, Headquarters
Building Authority, Series B,
MBIA-Insured, 5.125% due 9/1/17 1,955,250
Los Angeles County, CA Metropolitan
Transportation Authority Revenue,
Sales Tax Revenue:
3,400,000 AAA AMBAC-Insured, 5.000% due 7/1/25 3,251,250
8,530,000 AAA MBIA-Insured, 5.250% due 7/1/19 8,508,675
Los Angeles County, CA Public Works
Financing Authority Revenue, Series A:
1,380,000 AAA Multiple Capital Projects,
AMBAC-Insured, 5.125% due 6/1/17 1,357,575
1,500,000 AA Regional Park & Open Space District,
5.000% due 10/1/16 1,462,500
Metropolitan Water District Southern
California Water Works Revenue:
2,500,000 AA Series A, 5.000% due 7/1/18 2,434,375
1,000,000 AAA Series B, MBIA-Insured,
4.750% due 7/1/21 926,250
1,000,000 AAA Rancho Cucamonga, CA Redevelopment
Agency Tax Allocation, (Rancho
Redevelopment Project), MBIA-Insured,
5.250% due 9/1/26 990,000
2,000,000 AAA San Diego County, CA COP, North
County Regional Center Expansion,
AMBAC-Insured, 5.250% due 11/15/19 2,005,000
- ------------------------------------------------------------------------------------
29,719,000
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</TABLE>
See Notes to Financial Statements.
=================================== 4 ====================================
<PAGE>
- --------------------------------------------------------------------------------
Schedule of Investments
November 30, 1997 (unaudited) (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Face
Amount Rating Security Value
====================================================================================
<C> <C> <S> <C>
Colorado -- 5.2%
$2,000,000 AAA* Arapahoe County, CO Capital Improvement,
Highway Revenue, Current Series E,
(Pre-Refunded-- Escrowed with
U.S. government securities to 8/31/05
Call @ 103), 7.000% due 8/31/26(a)(b) $ 2,360,000
1,295,000 AA Colorado Springs, CO Utilities Revenue,
Series A, 5.125% due 11/15/23 1,267,481
2,000,000 AAA Denver, CO City & County Airport Revenue,
Series E, MBIA-Insured,
5.250% due 11/15/23 1,972,500
E-470 Public Highway Authority Revenue,
Series A, MBIA-Insured:
2,000,000 AAA 5.000% due 9/1/15 1,967,500
5,500,000 AAA 5.000% due 9/1/21 5,300,625
- ------------------------------------------------------------------------------------
12,868,106
- ------------------------------------------------------------------------------------
District of Columbia -- 0.2%
400,000 AAA District of Columbia Revenue, The
American University, AMBAC-Insured,
5.625% due 10/1/26 405,500
- ------------------------------------------------------------------------------------
Florida -- 4.1%
1,000,000 AAA Bay County, FL Water System Revenue,
MBIA-Insured, 5.125% due 9/1/22 985,000
2,000,000 AAA Dade County, FL GO Unlimited Revenue
Bonds, Florida Seaport, MBIA-Insured,
5.125% due 10/1/21 1,977,500
2,000,000 AAA Dade County, FL Water & Sewer
Systems Revenue, FGIC-Insured,
5.250% due 10/1/26 1,977,500
3,500,000 BBB- Martin County, FL IDR, (Indiantown
Cogeneration Project), Series A,
7.875% due 12/15/25(b)(c) 4,064,375
1,000,000 A* Martin County, FL Special Assessment
Revenue, 6.100% due 11/1/15 1,051,250
- ------------------------------------------------------------------------------------
10,055,625
- ------------------------------------------------------------------------------------
Georgia -- 0.3%
800,000 VMIG 1* Burke County, GA Development Authority
PCR, Georgia Power Co., 1st Series,
3.750% due 4/1/32 800,000
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Hawaii -- 1.0%
2,540,000 AAA Hawaii State GO, Series CP, FGIC-Insured,
5.000% due 10/1/16 2,476,500
- ------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
=================================== 5 ==================================
<PAGE>
- --------------------------------------------------------------------------------
Schedule of Investments
November 30, 1997 (unaudited) (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Face
Amount Rating Security Value
====================================================================================
<C> <C> <S> <C>
Illinois -- 5.0%
$ 7,000,000 AAA Illinois Health Facilities Authority,
(Ingalls Health Systems Project),
MBIA-Insured,
6.250% due 5/15/24 $ 7,411,250
1,000,000 AAA Illinois Health Facilities Authority,
Memorial Health Systems, MBIA-Insured,
5.250% due 10/1/18 978,750
1,000,000 AAA Illinois Metropolitan Pier & Exposition
Authority, (McCormick Plan Exposition
Project), Series A, AMBAC-Insured,
5.250% due 6/15/27 988,750
3,000,000 AAA Illinois State GO, FGIC-Insured,
5.250% due 12/1/20 2,977,500
- ------------------------------------------------------------------------------------
12,356,250
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Indiana -- 2.7%
2,000,000 AAA Avon, IN Community School Building
Corp., First Mortgage, AMBAC-Insured,
5.250% due 1/1/22 1,972,500
2,000,000 AAA Indiana Health Facility Authority Hospital
Revenue, Sisters of St. Francis Health,
Series A, 5.375% due 11/1/27 1,967,500
2,500,000 AA- Petersburg, IN Industrial PCR, Indianapolis
Power & Light Corp., 6.625% due 12/1/24 2,781,250
- ------------------------------------------------------------------------------------
6,721,250
- ------------------------------------------------------------------------------------
Iowa -- 0.3%
755,000 AAA Iowa Finance Authority, Multi-Family
Housing Revenue Refunding, (Forest
Glen Apartments Project), Series A,
FNMA-Collateralized, 5.600% due 11/1/22 762,550
- ------------------------------------------------------------------------------------
Maryland -- 1.4%
11,000,000 NR Maryland State Energy & Financing
Administration, Solid Waste
Disposal Revenue, Obligation,
Recycling, (Hagerstown Project),
9.000% due 10/15/16(b)(c)(d) 3,410,000
- ------------------------------------------------------------------------------------
Massachusetts -- 6.5%
2,000,000 AAA Massachusetts Bay Transportation Authority,
Series B, FSA-Insured, 5.250% due 3/1/26 1,967,500
10,000,000 NR Massachusetts State Industrial Financing
Agency, Solid Waste Disposal Revenue,
Massachusetts Recycling Association,
Series A, 9.000% due 8/1/16(b)(c)(d) 3,750,000
</TABLE>
See Notes to Financial Statements.
=================================== 6 ==================================
<PAGE>
- --------------------------------------------------------------------------------
Schedule of Investments
November 30, 1997 (unaudited) (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Face
Amount Rating Security Value
====================================================================================
<C> <C> <S> <C>
Massachusetts -- 6.5% (continued)
$1,000,000 AA- Massachusetts State Port Authority Revenue,
Series A, 5.000% due 7/1/27 $ 955,000
Massachusetts State Turnpike Authority,
Metropolitan Highway Systems Revenue,
Sub-Series B, MBIA-Insured:
2,000,000 AAA 5.250% due 1/1/29 1,977,500
1,500,000 AAA 5.250% due 1/1/37 1,440,000
Massachusetts State Water Resource
Authority, MBIA-Insured:
2,000,000 AAA Series B, 5.000% due 12/1/25 1,907,500
1,000,000 AAA Series C, 5.250% due 12/1/20 998,750
3,000,000 AAA Series D, 5.000% due 8/1/24 2,902,500
- ------------------------------------------------------------------------------------
15,898,750
- ------------------------------------------------------------------------------------
Michigan -- 5.0%
4,000,000 AA+ Michigan Municipal Bond Authority Revenue,
Revolving Fund, 5.125% due 10/1/20 3,955,000
1,500,000 AA- Michigan State Building Authority
Revenue Facilities Program, Series II,
4.750% due 10/15/13 1,428,750
Michigan State Hospital Finance Authority
Revenue, AMBAC-Insured:
2,000,000 AAA Detroit Medical Group, Series A,
5.250% due 8/15/27 1,950,000
650,000 AAA St. John Hospital & Medical Center,
5.250% due 5/15/26 638,625
2,055,000 AAA Mercy Health Services, Series W,
FSA-Insured, 5.250% due 8/15/27 2,003,625
2,000,000 NR Midland County, MI EDC, PCR,
Limited Obligation, Series B,
9.500% due 7/23/09(b)(c) 2,225,000
- ------------------------------------------------------------------------------------
12,201,000
- ------------------------------------------------------------------------------------
Minnesota -- 0.2%
500,000 A3* Minnesota State Higher Education Facilities
Authority Revenue, St. Johns University,
Series Four-L, 5.350% due 10/1/17 503,125
- ------------------------------------------------------------------------------------
Missouri -- 1.0%
1,000,000 AAA Fenton, MO COP, Capital Improvement
Projects, MBIA-Insured, 5.125% due 9/1/17 998,750
</TABLE>
See Notes to Financial Statements.
=================================== 7 ===================================
<PAGE>
- --------------------------------------------------------------------------------
Schedule of Investments
November 30, 1997 (unaudited) (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Face
Amount Rating Security Value
====================================================================================
<C> <C> <S> <C>
Missouri -- 1.0% (continued)
$1,500,000 AAA Kansas City, MO Municipal Assistance
Refunding, MBIA-Insured,
5.000% due 4/15/20 $ 1,447,500
- ------------------------------------------------------------------------------------
2,446,250
- ------------------------------------------------------------------------------------
New York -- 9.5%
New York City, NY Municipal Water
Finance Authority, Water & Sewer
Systems Revenue:
1,790,000 AAA MBIA-Insured, Series B,
5.375% due 6/15/19 1,794,475
Series A:
3,000,000 A2* 5.125% due 6/15/17 2,936,250
1,750,000 A2* 5.125% due 6/15/21 1,693,125
2,000,000 AA New York City Transitional Finance Authority
Revenue, Future Tax Secured, Series A,
5.000% due 8/15/17 1,952,500
New York State Dormitory Authority Revenue:
2,000,000 AAA Barnard College, AMBAC-Insured,
5.250% due 7/1/26 1,980,000
1,000,000 AAA Lease Revenue, Health Facilities
Improvement Program, Series A,
FSA-Insured, 5.500% due 5/15/16 1,013,750
1,500,000 AAA Mental Health Services Facilities
Improvement, Series D, FSA-Insured,
5.125% due 8/15/17 1,466,250
3,000,000 AAA Montefiore Medical Center,
AMBAC/FHA-Insured,
5.250% due 2/1/15 3,003,750
2,000,000 AAA Mount Sinai Medical School, Series A,
MBIA-Insured, 5.000% due 7/1/21 1,910,000
1,000,000 AAA New York State Medical Care Facilities
Finance Agency, FGIC-Insured,
5.250% due 2/15/19 986,250
2,580,000 BBB+ New York State Thruway Authority Service
Contract Revenue, Local Highway &
Bridge, 6.000% due 4/1/11 2,760,600
2,000,000 AA New York State Triborough Bridge & Tunnel
Authority, New York Revenue, Series A,
5.000% due 1/1/24 1,905,000
- ------------------------------------------------------------------------------------
23,401,950
- ------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
=================================== 8 ====================================
<PAGE>
- --------------------------------------------------------------------------------
Schedule of Investments
November 30, 1997 (unaudited) (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Face
Amount Rating Security Value
====================================================================================
<C> <C> <S> <C>
Ohio -- 1.6%
$4,000,000 AAA Cuyahoga County, OH Hospital Revenue,
Metrohealth Systems, Series A,
MBIA-Insured, 5.125% due 2/15/16 $ 3,935,000
- ------------------------------------------------------------------------------------
Pennsylvania -- 3.8%
2,500,000 AAA Altoona, PA City Authority, Water
Revenue Refunding, FGIC-Insured,
5.000% due 11/1/19 2,431,250
1,900,000 AAA Beaver County, PA IDA, FSA-Insured,
5.450% due 9/15/28 1,878,625
1,500,000 AAA Montgomery County, PA Health Care, Holy
Redeemer Health, Higher Education &
Health Authority Revenue, Series A,
AMBAC-Insured, 5.250% due 10/1/17 1,483,125
1,000,000 AAA Northeastern PA, Hospital & Education
Authority, Health Care Revenue,
Wyoming Valley Health Care, Series A,
AMBAC- Insured, 5.250% due 1/1/26 981,250
2,580,000 AAA North Wales, PA Water Authority,
FGIC-Insured, 5.000% due 11/1/15 2,534,850
- ------------------------------------------------------------------------------------
9,309,100
- ------------------------------------------------------------------------------------
Puerto Rico -- 0.5%
1,225,000 AAA Puerto Rico Commonwealth Infrastructure
Financing Authority, Series A,
AMBAC-Insured, 5.000% due 7/1/16 1,205,094
- ------------------------------------------------------------------------------------
South Carolina -- 0.8%
2,000,000 AAA Lexington County, SC Health Services
District Inc., Hospital Revenue Refunding
& Improvement, FSA-Insured,
5.250% due 11/1/17 1,982,500
- ------------------------------------------------------------------------------------
Texas -- 17.8%
2,000,000 AAA Azle, TX ISD, Series C, PSFG, FGIC-Insured,
5.000% due 2/15/22 1,920,000
7,000,000 AAA Bexar County, TX Health Facilities
Development Corp. Revenue,
Baptist Health Systems, Series A,
MBIA-Insured, 5.250% due 11/15/27 6,842,500
2,000,000 AAA Brazos County, TX Health Facilities
Development Corp., Franciscan Services
Corp. Revenue, Series A, MBIA-Insured,
5.375% due 1/1/17 2,007,500
</TABLE>
See Notes to Financial Statements.
=================================== 9 ====================================
<PAGE>
- --------------------------------------------------------------------------------
Schedule of Investments
November 30, 1997 (unaudited) (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Face
Amount Rating Security Value
====================================================================================
<C> <C> <S> <C>
Texas -- 17.8% (continued)
Burleson, TX ISD, PSFG:
$ 725,000 Aaa* 6.750% due 8/1/24 $ 807,469
1,775,000 AAA Pre-Refunded-- Escrowed with U.S.
government securities to 8/1/06
Call @ 100, 6.750% due 8/1/24(a) 2,045,688
3,650,000 AAA El Paso, TX ISD, PSFG, 5.900% due 2/15/13 3,809,688
2,000,000 AA Harris County, TX Health Facilities
Development Revenue, School Health Care
Systems, Series B, 5.750% due 7/1/27 2,062,500
2,500,000 AA Harris County, TX Toll Road, Sub-Lien,
5.125% due 8/15/17 2,462,500
1,250,000 AAA Leander, TX ISD, PSFG, 5.625% due 8/15/17 1,276,562
2,500,000 AAA Nueces River Authority, Texas Water Supply,
FSA-Insured, 5.500% due 3/1/27 2,515,625
1,000,000 AAA Plano, TX Health Facilities Development
Corp. Revenue, Texas Health Resources
Systems, Series C, MBIA-Insured,
5.250% due 2/15/26 977,500
9,035,000 AA Texas State Veterans Housing GO,
Series B-4, 6.700% due 12/1/24(c) 9,723,919
1,000,000 AA Texas State Water Development,
5.250% due 8/1/28 995,000
Texas Water Development Board Revenue,
State Revolving Fund, Senior Lien,
Series B:
1,200,000 AAA 5.000% due 7/15/14 1,194,000
3,110,000 AAA 5.000% due 7/15/16 3,059,462
2,000,000 AAA 5.000% due 7/15/19 1,932,500
- ------------------------------------------------------------------------------------
43,632,413
- ------------------------------------------------------------------------------------
Utah -- 4.7%
12,000,000 A+ Intermountain Power Agency, Utah
Power Supply Revenue, Series D,
5.000% due 7/1/21 11,460,000
- ------------------------------------------------------------------------------------
Virginia -- 4.9%
Virginia College Building Authority, VA
Educational Facilities Revenue:
1,250,000 A+ Hampton University Project,
5.750% due 4/1/14 1,279,687
3,425,000 AA 21st Century College Program,
5.200% due 8/1/12 3,510,625
</TABLE>
See Notes to Financial Statements.
=================================== 10 ====================================
<PAGE>
- --------------------------------------------------------------------------------
Schedule of Investments
November 30, 1997 (unaudited) (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Face
Amount Rating Security Value
====================================================================================
<C> <C> <S> <C>
Virginia -- 4.9% (continued)
Virginia State Housing Development
Authority, Commonwealth Mortgage:
$ 3,760,000 AA+ Series A, Sub-Series A-1,
6.400% due 7/1/17 $ 3,995,000
Series D:
1,640,000 AA+ Sub-Series D-1, 6.400% due 7/1/17 1,754,800
1,315,000 AA+ Sub-Series D-3, 5.800% due 7/1/10 1,382,394
- ------------------------------------------------------------------------------------
11,922,506
- ------------------------------------------------------------------------------------
Washington -- 4.0%
6,285,000 AAA Chelan County, WA Public Utilities
District 1, Columbia River Rock,
Capital Appreciation, MBIA-Insured,
zero coupon due 6/1/24 1,563,394
2,040,000 Aaa* Skagit County, WA Public Hospital District
No. 001 Revenue Refunding, Affiliated
Health Services, FSA-Insured,
5.750% due 12/1/11 2,162,400
1,000,000 AA+ Washington State GO, Series E,
5.000% due 7/1/22 963,750
Washington State Public Power Supply System:
1,000,000 AAA Series A, Nuclear Project No. 2,
FSA-Insured, 5.125% due 7/1/11 1,001,250
4,250,000 Aa1* Series B, Nuclear Project No. 3,
5.500% due 7/1/18 4,223,437
- ------------------------------------------------------------------------------------
9,914,231
- ------------------------------------------------------------------------------------
West Virginia -- 2.2%
Marion County, WV Community Solid Waste
Disposal Facilities Revenue:
1,000,000 NR American Fiber Resource Project,
Series B, 9.250% due 12/1/11(b)(c)(d) 500,000
10,000,000 NR American Paper Recycling Project,
7.750% due 12/1/11(b)(c)(d) 5,000,000
- ------------------------------------------------------------------------------------
5,500,000
- ------------------------------------------------------------------------------------
Wisconsin -- 4.3%
Wisconsin State Health & Educational
Facilities Authority Revenue, MBIA-Insured:
Aurora Health Care Inc.:
2,000,000 AAA 5.250% due 8/15/17 1,980,000
6,000,000 AAA 5.250% due 8/15/27 5,835,000
</TABLE>
See Notes to Financial Statements.
=================================== 11 ====================================
<PAGE>
- --------------------------------------------------------------------------------
Schedule of Investments
November 30, 1997 (unaudited) (continued)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Face
Amount Rating Security Value
====================================================================================
<C> <C> <S> <C>
Wisconsin -- 4.3% (continued)
$1,700,000 AAA Aurora Health Care Obligated,
5.250% due 8/15/23 $ 1,676,625
1,000,000 AAA The Medical College Wisconsin Inc.
Project, 5.400% due 12/1/16 1,001,250
- ------------------------------------------------------------------------------------
10,492,875
- ------------------------------------------------------------------------------------
Wyoming -- 0.9%
2,000,000 AA Wyoming Community Development
Authority Housing Revenue, Series 4,
5.900% due 12/1/14 2,095,000
- ------------------------------------------------------------------------------------
TOTAL INVESTMENTS -- 100%
(COST-- $253,826,316**) $245,474,575
====================================================================================
</TABLE>
(a) Pre-Refunded bonds escrowed with U.S. government securities are considered
by the manager to be triple-A rated even if the issuer has not applied for
new ratings.
(b) Security segregated by custodian for open purchase commitments.
(c) Income from this issue is considered a preference item for purposes of
calculating the alternative minimum tax.
(d) Security in default.
(e) Variable rate municipal bonds and notes are payable on one business day's
notice.
** Aggregate cost for Federal income tax purposes is substantially the same.
See pages 13 and 14 for definition of ratings and certain security
descriptions.
- --------------------------------------------------------------------------------
Summary of Investments by Combined Ratings
November 30, 1997 (unaudited)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Standard & Percent of
Moody's and/or Poor's Total Investments
- --------------------------------------------------------------------------------
Aaa AAA 62.2%
Aa AA 20.9
A A 7.7
Baa BBB 2.8
VMIG 1 P-1 0.3
NR NR 6.1
------
100.0%
======
See Notes to Financial Statements.
=================================== 12 ====================================
<PAGE>
- --------------------------------------------------------------------------------
Bond Ratings
- --------------------------------------------------------------------------------
All ratings are by Standard & Poor's Rating Service ("Standard & Poor's"),
except those identified by an asterisk (*) are rated by Moody's Investors
Service, Inc. ("Moody's"). The definitions of the applicable rating symbols are
set forth below:
Standard & Poor's -- Ratings from "AA" to "BBB" may be modified by the addition
of a plus (+) or a minus (-) sign to show relative standings within the major
rating categories.
AAA -- Bonds rated "AAA" have the highest rating assigned by Standard &
Poor's. Capacity to pay interest and repay principal is extremely
strong.
AA -- Bonds rated "AA" have a very strong capacity to pay interest and
repay principal and differ from the highest rated issue only in a
small degree.
A -- Bonds rated "A" have a strong capacity to pay interest and repay
principal although it is somewhat more susceptible to the adverse
effects of changes in circumstances and economic conditions than debt
in higher rated categories.
BBB -- Bonds rated "BBB" are regarded as having an adequate capacity to
pay interest and repay principal. Whereas they normally exhibit
adequate protection parameters, adverse economic conditions or
changing circumstances are more likely to lead to a weakened capacity
to pay interest and repay principal for debt in this category than in
higher rated categories.
Moody's-- Numerical modifiers 1, 2, and 3 may be applied to each generic rating
from "Aa" to "Baa," where 1 is the highest and 3 the lowest rating within its
generic category.
Aaa -- Bonds that are rated "Aaa" are judged to be of the best quality.
They carry the smallest degree of investment risk and are generally
referred to as "gilt edge." Interest payments are protected by a large
or by an exceptionally stable margin and principal is secure. While
the various protective elements are likely to change, such changes as
can be visualized are most unlikely to impair the fundamentally strong
position of such issues.
Aa -- Bonds that are rated "Aa" are judged to be of high quality by all
standards. Together with the "Aaa" group they comprise what are
generally known as high grade bonds. They are rated lower than the
best bonds because margins of protection may not be as large as in
"Aaa" securities or fluctuation of protective elements may be of
greater amplitude or there may be other elements present which make
the long-term risks appear somewhat larger than in "Aaa" securities.
A -- Bonds that are rated "A" possess many favorable investment
attributes and are to be considered as upper medium grade obligations.
Factors giving security to principal and interest are considered
adequate but elements may be present which suggest a susceptibility to
impairment some time in the future.
Baa -- Bonds that are rated "Baa" are considered as medium grade
obligations, i.e., they are neither highly protected nor poorly
secured. Interest payments and principal security appear adequate for
the present but certain protective elements may be lacking or may be
characteristically unreliable over any great length of time. Such
bonds lack outstanding investment characteristics and in fact have
speculative characteristics as well.
NR -- Indicates that the bond is not rated by Standard & Poor's or
Moody's.
=================================== 13 ====================================
<PAGE>
- --------------------------------------------------------------------------------
Short-Term Securities Ratings
- --------------------------------------------------------------------------------
SP-1 -- Standard & Poor's highest rate rating indicating very strong or
strong capacity to pay principal and interest; those issues determined
to possess overwhelming safety characteristics are denoted with a plus
(+) sign.
A-1 -- Standard & Poor's highest commercial paper and variable-rate demand
obligation (VRDO) rating indicating that the degree of safety
regarding timely payment is either overwhelming or very strong; those
issues determined to possess overwhelming safety characteristics are
denoted with a plus (+) sign.
VMIG1 -- Moody's highest rating for issues having demand feature -- VRDO.
P-1 -- Moody's highest rating for commercial paper and for VRDO prior to
the advent of the VMIG 1 rating.
- --------------------------------------------------------------------------------
Security Descriptions
- --------------------------------------------------------------------------------
ABAG -- Association of Bay Area Governors
AIG -- American International Guaranty
AMBAC -- American Municipal Bond Assurance Corporation
BAN -- Bond Anticipation Notes
BIG -- Bond Investors Guaranty
CDA -- Community Development Administration
CGIC -- Capital Guaranty Insurance Company
CHFCLI -- California Health Facility Construction Loan Insurance
COP -- Certificate of Participation
EDA -- Economic Development Authority
EDC -- Economic Development Corporation
ETM -- Escrowed to Maturity
FAIRS -- Floating Adjustable Interest Rate Securities
FGIC -- Financial Guaranty Insurance Company
FHA -- Federal Housing Administration
FHLMC -- Federal Home Loan Mortgage Corporation
FNMA -- Federal National Mortgage Association
FRTC -- Floating Rate Trust Certificates
FSA -- Federal Savings Association
GIC -- Guaranteed Investment Contract
GNMA -- Government National Mortgage Association
GO -- General Obligation
HDC -- Housing Development Corporation
HFA -- Housing Finance Authority
IDA -- Industrial Development Agency
IDB -- Industrial Development Board
IDR -- Industrial Development Revenue
INFLOS -- Inverse Floaters
ISD -- Independent School District
LOC -- Letter of Credit
MBIA -- Municipal Bond Investors Assurance Corporation
MVRICS -- Municipal Variable Rate Inverse Coupon Security
PCR -- Pollution Control Revenue
PSFG -- Permanent School Fund Guaranty
RAN -- Revenue Anticipation Notes
RIBS -- Residual Interest Bonds
RITES -- Residual Interest Tax-Exempt Securities
SYCC -- Structured Yield Curve Certificate
TAN -- Tax Anticipation Notes
TECP -- Tax Exempt Commercial Paper
TOB -- Tender Option Bonds
TRAN -- Tax and Revenue Anticipation Notes
VA -- Veterans Administration
VRDD -- Variable Rate Daily Demand
VRWE -- Variable Rate Wednesday Demand
=================================== 14 ====================================
<PAGE>
- --------------------------------------------------------------------------------
Statement of Assets and Liabilities
(unaudited)
- --------------------------------------------------------------------------------
November 30, 1997
================================================================================
ASSETS:
Investments, at value (Cost-- $253,826,316) $ 245,474,575
Cash 9,575
Receivable for securities sold 6,296,510
Interest receivable 3,512,825
- --------------------------------------------------------------------------------
Total Assets 255,293,485
- --------------------------------------------------------------------------------
LIABILITIES:
Payable for securities purchased 18,620,339
Dividends payable 550,339
Investment advisory fees payable 164,724
Accrued expenses 139,496
- --------------------------------------------------------------------------------
Total Liabilities 19,474,898
- --------------------------------------------------------------------------------
Total Net Assets $ 235,818,587
================================================================================
NET ASSETS:
Par value of capital shares $ 19,760
Capital paid in excess of par value 236,402,155
Overdistributed net investment income (373,405)
Accumulated net realized gain from security transactions 8,121,818
Net unrealized depreciation of investments (8,351,741)
- --------------------------------------------------------------------------------
Total Net Assets
(Equivalent to $11.93 a share on 19,759,732 shares of
$0.001 par value outstanding; 500,000,000 shares authorized) $ 235,818,587
================================================================================
See Notes to Financial Statements.
=================================== 15 ====================================
<PAGE>
- --------------------------------------------------------------------------------
Statement of Operations
(unaudited)
- --------------------------------------------------------------------------------
Six Months
Ended
11/30/97
================================================================================
INVESTMENT INCOME:
Interest $ 6,158,019
- --------------------------------------------------------------------------------
EXPENSES:
Investment advisory fees (Note 3) 1,043,213
Shareholder communications 49,758
Audit and legal 30,365
Shareholder and system servicing fees 18,851
Directors' fees 16,862
Registration fees 7,571
Custody 6,181
Pricing service fees 5,115
Other 1,572
- --------------------------------------------------------------------------------
Total Expenses 1,179,488
- --------------------------------------------------------------------------------
Net Investment Income 4,978,531
- --------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN ON
INVESTMENTS (NOTE 4):
Realized Gain From Security Transactions
(excluding short-term securities):
Proceeds from sales 128,895,445
Cost of securities sold 123,973,100
- --------------------------------------------------------------------------------
Net Realized Gain 4,922,345
- --------------------------------------------------------------------------------
Change in Net Unrealized Depreciation
of Investments:
Beginning of period (12,124,789)
End of period (8,351,741)
- --------------------------------------------------------------------------------
Decrease in Net Unrealized Depreciation 3,773,048
- --------------------------------------------------------------------------------
Net Gain on Investments 8,695,393
- --------------------------------------------------------------------------------
Increase in Net Assets From Operations $ 13,673,924
================================================================================
See Notes to Financial Statements.
=================================== 16 ====================================
<PAGE>
- --------------------------------------------------------------------------------
Statements of Changes in Net Assets
- --------------------------------------------------------------------------------
Six Months
Ended Year
11/30/97 Ended
(unaudited) 5/31/97
================================================================================
OPERATIONS:
Net investment income $ 4,978,531 $ 13,009,211
Net realized gain 4,922,345 5,790,754
(Increase) decrease in net unrealized
depreciation 3,773,048 (10,998,928)
- --------------------------------------------------------------------------------
Increase in Net Assets From Operations 13,673,924 7,801,037
- --------------------------------------------------------------------------------
DISTRIBUTIONS TO
SHAREHOLDERS FROM (NOTE 2):
Net investment income (6,873,349) (12,922,738)
Net realized gains -- (6,649,833)
- --------------------------------------------------------------------------------
Decrease in Net Assets From
Distributions to Shareholders (6,873,349) (19,572,571)
- --------------------------------------------------------------------------------
FUND SHARE TRANSACTIONS (NOTE 5):
Net asset value of shares issued
for reinvestment of dividends 1,103,689 1,218,075
- --------------------------------------------------------------------------------
Increase in Net Assets From
Fund Share Transactions 1,103,689 1,218,075
- --------------------------------------------------------------------------------
Increase (Decrease) in Net Assets 7,904,264 (10,553,459)
NET ASSETS:
Beginning of period 227,914,323 238,467,782
- --------------------------------------------------------------------------------
End of period* $ 235,818,587 $ 227,914,323
================================================================================
* Includes undistributed (overdistributed)
net investment income of: $ (373,405) $ 1,521,413
================================================================================
See Notes to Financial Statements.
=================================== 17 ====================================
<PAGE>
- --------------------------------------------------------------------------------
Notes to Financial Statements
(unaudited)
- --------------------------------------------------------------------------------
1. Significant Accounting Policies
Greenwich Street Municipal Fund Inc. ("Fund"), a Maryland corporation, is
registered under the Investment Company Act of 1940, as amended, as a
non-diversified, closed-end management investment company.
The significant accounting policies consistently followed by the Fund are:
(a) security transactions are accounted for on trade date; (b) securities are
valued at the mean between bid and ask prices provided by an independent pricing
service that are based on transactions in municipal obligations, quotations from
municipal bond dealers, market transactions in comparable securities and various
relationships between securities; (c) securities maturing within 60 days are
valued at cost plus accreted discount, or minus amortized premium, which
approximates value; (d) gains or losses on the sale of securities are calculated
by using the specific identification method; (e) interest income, adjusted for
amortization of premium and accretion of original issue discount, is recorded on
the accrual basis; market discount is recognized upon the disposition of the
security; (f) dividends and distributions to shareholders are recorded on the
ex-dividend date; (g) the Fund intends to comply with the applicable provisions
of the Internal Revenue Code of 1986, as amended, pertaining to regulated
investment companies and to make distributions of taxable income sufficient to
relieve it from substantially all Federal income and excise taxes; (h) the
character of income and gains to be distributed are determined in accordance
with income tax regulations which may differ from generally accepted accounting
principles. At May 31, 1997, reclassifications were made to the Portfolio's
capital accounts to reflect permanent book/tax differences and income and gains
available for distributions under income tax regulations; and (i) estimates and
assumptions are required to be made regarding assets, liabilities and changes in
net assets resulting from operations when financial statements are prepared.
Changes in the economic environment, financial markets and any other parameters
used in determining these estimates could cause actual results to differ.
2. Dividends, Exempt-Interest Dividends and Other Distributions
The Fund intends to satisfy conditions that will enable interest from
municipal securities, which is exempt from regular Federal income tax and from
designated state income taxes, to retain such tax-exempt status when distributed
to the shareholders of the Fund.
Capital gain distributions, if any, are taxable to shareholders, and are
declared and paid at least annually.
=================================== 18 ====================================
<PAGE>
- --------------------------------------------------------------------------------
Notes to Financial Statements
(unaudited) (continued)
- --------------------------------------------------------------------------------
3. Investment Advisory Agreement and Other Transactions
Mutual Management Corp. ("MMC"), formerly known as Smith Barney Mutual
Funds Management Inc., a subsidiary of Salomon Smith Barney Holdings Inc.
("SSBH"), acts as investment adviser to the Fund. The Fund pays MMC an advisory
fee calculated at an annual rate of 0.90% of the Fund's average daily net
assets. This fee is calculated daily and paid monthly.
All officers and one Director of the Fund are employees of Smith Barney
Inc.
4. Securities Transactions
For the six months ended November 30, 1997, the aggregate cost of
purchases and proceeds from sales of investments (including maturities but
excluding short-term securities) were as follows:
================================================================================
Purchases $(134,341,725
- --------------------------------------------------------------------------------
Sales 128,895,445
================================================================================
At November 30, 1997, the aggregate gross unrealized appreciation and
depreciation of investments for Federal income tax purposes were substantially
as follows:
================================================================================
Gross unrealized appreciation $(10,953,127
Gross unrealized depreciation (19,304,868)
- --------------------------------------------------------------------------------
Net unrealized depreciation $ (8,351,741)
================================================================================
5. Capital Shares
During the six months ended November 30, 1997, capital stock transactions
were as follows:
Shares Amount
================================================================================
Shares issued on reinvestment 94,878 $1,103,689
================================================================================
=================================== 19 ====================================
<PAGE>
- --------------------------------------------------------------------------------
Financial Highlights
- --------------------------------------------------------------------------------
For a share of capital stock outstanding throughout each period:
<TABLE>
<CAPTION>
1997(1) 1997 1996 1995(2)
=======================================================================================
<S> <C> <C> <C> <C>
Net Asset Value,
Beginning of Period $ 11.59 $ 12.19 $ 12.84 $ 12.00
- ---------------------------------------------------------------------------------------
Income From Operations:
Net investment income 0.25 0.66 0.66 0.63
Net realized and unrealized
gain (loss) 0.44 (0.26) (0.42) 0.77
- ---------------------------------------------------------------------------------------
Total Income From Operations 0.69 0.40 0.24 1.40
- ---------------------------------------------------------------------------------------
Offering Costs Charged to
Paid-In Capital -- -- -- (0.02)
- ---------------------------------------------------------------------------------------
Less Distributions From:
Net investment income (0.35) (0.66) (0.66) (0.54)
Net realized gains -- (0.34) (0.23) --
- ---------------------------------------------------------------------------------------
Total Distributions (0.35) (1.00) (0.89) (0.54)
- ---------------------------------------------------------------------------------------
Net Asset Value,
End of Period $ 11.93 $ 11.59 $ 12.19 $ 12.84
- ---------------------------------------------------------------------------------------
Total Return, Based on
Market Value 1.91%++ 8.97% 5.52% 1.65%++
- ---------------------------------------------------------------------------------------
Total Return, Based on
Net Asset Value* 6.06%++ 3.61% 2.40% 12.28%++
- ---------------------------------------------------------------------------------------
Net Assets,
End of Period (000s) $ 235,819 $ 227,914 $ 238,468 $ 251,219
- ---------------------------------------------------------------------------------------
Ratios to Average Net Assets:
Expenses 1.01%+ 1.03% 1.06% 1.05%+
Net investment income 4.25+ 5.57 5.17 5.63+
- ---------------------------------------------------------------------------------------
Portfolio Turnover Rate 54% 115% 42% 115%
- ---------------------------------------------------------------------------------------
Market Value, End of Period $ 11.250 $ 11.375 $ 11.375 $ 11.625
=======================================================================================
</TABLE>
(1) For the six months ended November 30, 1997 (unaudited).
(2) For the period from June 24, 1994 (commencement of operations) to May 31,
1995.
* The total return is based on the Fund's net asset value at the beginning
and end of the period rather than the market value. Dividends are
reinvested in accordance with the Fund's dividend reinvestment plan.
++ Total return is not annualized, as it may not be representative of the
total return for the year.
+ Annualized.
=================================== 20 ====================================
<PAGE>
- --------------------------------------------------------------------------------
Quarterly Results of Operations
(unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Net Realized Net Increase
and Unrealized (Decrease) in
Investment Net Investment Gain (Loss) on Net Assets From
Income Income Investments Operations
- ----------------------------------------------------------------------------------------------
Quarter Per Per Per Per
Ended Total Share Total Share Total Share Total Share
==============================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C>
8/31/94* $2,522,206 $0.13 $2,049,342 $0.11 $ 4,076,999 $0.20 $ 6,126,341 $0.31
11/30/94 3,946,853 0.20 3,334,708 0.17 (22,644,150) (1.16) (19,309,442) (0.99)
2/28/95 3,990,277 0.20 3,363,082 0.17 24,095,398 1.23 27,458,480 1.40
5/31/95 4,061,565 0.21 3,497,852 0.18 9,687,147 0.50 13,184,999 0.68
8/31/95 3,871,127 0.20 3,186,132 0.16 (3,092,160) (0.16) 93,972 0.01
11/30/95 3,890,364 0.20 3,202,189 0.16 8,514,682 0.44 11,716,871 0.60
2/29/96 3,877,668 0.20 3,181,364 0.16 (2,239,170) (0.11) 942,194 0.04
5/31/96 3,852,531 0.19 3,290,364 0.18 (11,345,622) (0.59) (8,055,258) (0.41)
8/31/96 3,940,034 0.20 3,319,852 0.17 (3,899,664) (0.20) (579,812) (0.03)
11/30/96 3,836,212 0.20 3,226,504 0.17 8,809,662 0.45 12,036,166 0.62
2/28/97 3,780,875 0.19 3,189,232 0.16 (7,930,720) (0.40) (4,741,488) (0.24)
5/31/97 3,857,047 0.19 3,273,623 0.16 (2,187,452) (0.11) 1,086,171 0.05
8/31/97 3,149,970 0.16 2,546,539 0.13 3,996,871 0.20 6,543,410 0.33
11/30/97 3,008,049 0.15 2,431,992 0.12 4,698,522 0.24 7,130,514 0.36
==============================================================================================
* For the period from June 24, 1994 (commencement of operations) to August 31, 1994.
</TABLE>
=================================== 21 ====================================
<PAGE>
- --------------------------------------------------------------------------------
Financial Data
(unaudited)
- --------------------------------------------------------------------------------
For a share of capital stock outstanding throughout each period:
NYSE Dividend
Record Payable Closing Net Asset Dividend Reinvestment
Date Date Price* Value* Paid Price
================================================================================
9/23/94 9/30/94 $11.250 $11.93 $0.060 $11.50
10/24/94 10/31/94 11.125 11.63 0.060 10.91
11/22/94 11/30/94 10.375 10.81 0.060 10.57
12/22/94 12/30/94 10.250 11.33 0.060 10.47
1/24/95 1/31/95 10.938 11.63 0.060 10.81
2/21/95 2/28/95 11.500 12.19 0.060 11.11
3/24/95 3/31/95 11.375 12.40 0.060 11.38
4/21/95 4/28/95 11.438 12.57 0.060 11.47
5/23/95 5/31/95 11.438 12.72 0.060 11.69
6/23/95 6/30/95 11.375 12.71 0.060 11.62
7/25/95 7/28/95 11.563 12.53 0.060 11.48
8/22/95 8/25/95 11.375 12.86 0.060 11.52
9/26/95 9/29/95 11.500 12.62 0.060 11.20
10/24/95 10/27/95 11.500 12.84 0.060 11.58
11/20/95 11/24/95 11.750 12.95 0.060 11.64
12/26/95+ 12/29/95 11.875 12.99 0.230 12.10
1/23/96 1/26/96 11.875 12.92 0.060 12.12
2/20/96 2/23/96 12.000 12.86 0.060 12.30
3/26/96 3/29/96 11.375 12.55 0.060 11.54
4/23/96 4/26/96 11.438 12.32 0.060 11.42
5/28/96 5/31/96 11.375 12.35 0.060 11.43
6/25/96 6/28/96 11.250 12.10 0.060 11.54
7/23/96 7/26/96 11.375 12.06 0.060 11.58
8/27/96 8/30/96 11.625 12.10 0.060 11.70
9/24/96 9/27/96 11.688 12.08 0.060 11.71
10/22/96 10/25/96 11.688 12.18 0.060 11.75
11/25/96 11/29/96 11.625 12.35 0.060 11.59
12/23/96+ 12/27/96 11.250 11.99 0.340 11.56
1/28/97 1/31/97 11.563 11.65 0.060 11.53
2/25/97 2/28/97 11.750 11.80 0.060 11.66
3/24/97 3/27/97 11.250 11.40 0.060 11.40
4/22/97 4/25/97 11.250 11.30 0.060 11.29
5/27/97 5/30/97 11.250 11.51 0.060 11.49
6/24/97 6/27/97 11.625 11.74 0.060 11.74
7/22/97 7/25/97 11.875 11.98 0.060 11.90
8/26/97 8/29/97 11.563 11.70 0.060 11.65
9/23/97 9/26/97 11.625 11.86 0.056 11.56
10/28/97 10/31/97 11.063 11.86 0.056 11.29
11/24/97 11/28/97 11.250 11.90 0.056 11.45
================================================================================
* As of record date.
+ Capital gain distribution.
=================================== 21 ====================================
<PAGE>
- --------------------------------------------------------------------------------
Dividend Reinvestment Plan
(unaudited)
- --------------------------------------------------------------------------------
Under the Portfolio's Dividend Reinvestment Plan (the "Plan"), a
shareholder whose shares of Common Stock are registered in his own name will
have all distributions from the Portfolio reinvested automatically by First Data
as agent under the Plan, unless the shareholder elects to receive cash.
Distributions with respect to shares registered in the name of a broker-dealer
or other nominee (that is, in "Street Name") will be reinvested by the broker or
nominee in additional shares under the Plan, unless the service is not provided
by the broker or nominee or the shareholder elects to receive distributions in
cash. Investors who own Common Stock registered in Street Name should consult
their broker-dealers for details regarding reinvestment. All distributions to
shareholders who do not participate in the Plan will be paid by check mailed
directly to the record holder by or under the direction of First Data as
dividend paying agent.
The number of shares of Common Stock distributed to participants in the
Plan in lieu of a cash dividend is determined in the following manner. When the
market price of the Common Stock is equal to or exceeds the net asset value per
share of the Common Stock on the date of valuation, Plan participants will be
issued shares of Common Stock at a price equal to the greater of net asset value
most recently determined as described below under "Net Asset Value" or 95% of
the market price of the Common Stock.
If the market price of the Common Stock is less than the net asset value
of the Common Stock at the time of valuation, or if the Portfolio declares a
dividend or capital gains distribution payable only in cash, First Data will buy
Common Stock in the open market, on the New York Stock Exchange or elsewhere,
for the participants' accounts. If following the commencement of the purchases
and before First Data has completed its purchases, the market price exceeds the
net asset value of the Common Stock, First Data will attempt to terminate
purchases in the open market and cause the Portfolio to issue the remaining
portion of the dividend or distribution in shares at a price equal to the
greater of (a) net asset value or (b) 95% of the then current market price. In
this case, the number of shares received by a Plan participant will be based on
the weighted average of prices paid for shares purchased in the open market and
the price at which the Portfolio issues the remaining shares. To the extent
First Data is unable to stop open market purchases and cause the Portfolio to
issue the remaining shares, the average per share purchase price paid by the
Purchasing Agent may exceed the net asset value of the Common Stock, resulting
in the acquisition of fewer shares than if the dividend or capital gains
distribution had been paid in Common Stock issued
=================================== 23 ====================================
<PAGE>
- --------------------------------------------------------------------------------
Dividend Reinvestment Plan
(unaudited) (continued)
- --------------------------------------------------------------------------------
by the Portfolio at net asset value. First Data will begin to purchase Common
Stock on the open market as soon as practicable after the payment date of the
dividend or capital gains distribution, but in no event shall such purchases
continue later than 30 days after that date, except when necessary to comply
with applicable provisions of the federal securities laws.
First Data maintains all shareholder accounts in the Plan and furnishes
written confirmations of all transactions in each account, including information
needed by a shareholder for personal and tax records. The automatic reinvestment
of dividends and capital gains distributions will not relieve Plan participants
of any income tax that may be payable on the dividends or capital gains
distributions. Common Stock in the account of each Plan participant will be held
by First Data in uncertificated form in the name of the Plan participant.
Plan participants are subject to no charge for reinvesting dividends and
capital gains distributions under the Plan. First Data's fees for handling the
reinvestment of dividends and capital gains distributions will be paid by the
Portfolio. No brokerage charges apply with respect to shares of Common Stock
issued directly by the Portfolio under the Plan. Each Plan participant will,
however, bear a proportionate share of brokerage commissions incurred with
respect to any open market purchases made under the Plan.
Experience under the Plan may indicate that changes to it are desirable.
The Portfolio reserves the right to amend or terminate the Plan as applied to
any dividend or capital gains distribution paid subsequent to written notice of
the change sent to participants at least 30 days before the record date for the
dividend or capital gains distribution. The Plan also may be amended or
terminated by First Data, with the Portfolio's prior written consent, on at
least 30 days' written notice to Plan participants. All correspondence
concerning the Plan should be directed by mail to First Data Investor Services
Group, P.O. Box 1376, Boston, Massachusetts 02104 or by telephone at
1-800-331-1710.
- --------------------------------------------------------------------------------
Additional Information
(unaudited)
- --------------------------------------------------------------------------------
Notice is hereby given in accordance with Section 23(c) of the Investment
Company Act of 1940, as amended, that from time to time the Fund may purchase
shares of its common stock in the open market.
=================================== 24 ====================================
<PAGE>
Greenwich Street Municipal
Fund Inc.
Directors
Allan J. Bloostein
Martin Brody
Dwight B. Crane
Robert A. Frankel
William R. Hutchinson
Heath B. McLendon, Chairman
Charles F. Barber, Emeritus
Officers
Heath B. McLendon
President and
Chief Executive Officer
Lewis E. Daidone
Senior Vice President
and Treasurer
Joseph P. Deane
Vice President and
Investment Officer
David Fare
Investment Officer
Thomas M. Reynolds
Controller
Christina T. Sydor
Secretary
Investment Adviser
Mutual Management Corp.
388 Greenwich Street
New York, New York 10013
Transfer Agent
First Data Investor Services
Group, Inc.
P.O. Box 1376
Boston, Massachusetts 02104
Custodian
PNC Bank, N.A.
17th and Chestnut Streets
Philadelphia, Pennsylvania 19103
=================================== 25 ====================================
<PAGE>
This report is intended only for the shareholders
of Greenwich Street Municipal Fund Inc.
It is not a Prospectus,
circular or representation intended for use in the
purchase or sale of the Fund or any
securities mentioned in the report.
FD0838 1/98
