<PAGE>
SEMI-ANNUAL REPORT
------------------------------------------------------
February 28, 1998
NEUBERGER&BERMAN
EQUITY TRUST-Registered Trademark-
Neuberger&Berman
NYCDC SOCIALLY RESPONSIVE TRUST
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S> <C>
THE FUND
CHAIRMAN'S LETTER A-4
PORTFOLIO COMMENTARY A-5
FINANCIAL STATEMENTS B-1
FINANCIAL HIGHLIGHTS B-7
PER SHARE DATA
THE PORTFOLIO
SCHEDULE OF INVESTMENTS B-9
TOP TEN EQUITY HOLDINGS
FINANCIAL STATEMENTS B-12
FINANCIAL HIGHLIGHTS B-18
DIRECTORY C-1
OFFICERS AND TRUSTEES C-2
</TABLE>
A-3
<PAGE>
CHAIRMAN'S LETTER April 17, 1998
Dear Fellow Shareholder,
At the end of this semi-annual reporting period (February 28, 1998), the major
market indices stood at record levels. However, the preceding six months have
not been easy. The Asian currency crisis that surfaced in mid-summer caused
considerable damage to a number of sectors of the domestic equities market in
late 1997. In what we viewed as a classic Wall Street "shoot first and ask
questions later" response, technology stocks were among the casualties.
Neuberger&Berman portfolio managers were faced with a classic investment
dilemma -- think short term and retreat, or hold their ground in sectors and
individual stocks they believed to have outstanding long-term performance
potential. I'm proud to say, they chose the latter option, and so far in early
1998, were rewarded for their persistence.
In today's volatile equity markets, investors' patience and discipline is
tested on a daily basis. Experienced investors realize that the prospect for
superior long-term returns is diminished by overreaction to short-term events.
At Neuberger&Berman, we pride ourselves on being farsighted. We are not
influenced by emotion or market fads and fashion. We strive to be coldly
analytical and focus on where we think a stock will be in three years, not three
months. We believe if we can successfully ignore the market's constant static
and focus on the long-term fundamental message, we will achieve our goal of
providing shareholders solid long-term returns.
Sincerely,
/s/ Stanley Egener
Stanley Egener
Chairman of the Board
Neuberger&Berman Equity Trust
A-4
<PAGE>
PORTFOLIO COMMENTARY
Neuberger&Berman
- ----------------------------------------------------------------------
NYCDC Socially Responsive Trust
PORTFOLIO MANAGER JANET PRINDLE BELIEVES DOING GOOD IS GOOD BUSINESS AND
HAS THE POTENTIAL TO PRODUCE POSITIVE INVESTMENT RESULTS. SHE FOCUSES ON
COMPANIES THAT ARE AGENTS OF FAVORABLE CHANGE IN WORKPLACE POLICIES
(PARTICULARLY FOR WOMEN AND MINORITIES); ARE GOOD CORPORATE CITIZENS; AND
ARE RESPONSIVE TO ENVIRONMENTAL ISSUES. SHE DOES NOT INVEST IN TOBACCO,
ALCOHOL, GAMBLING, NUCLEAR POWER, OR WEAPONS COMPANIES. BUT, SOCIAL
RESPONSIBILITY ALONE DOES NOT QUALIFY A COMPANY AS A GOOD INVESTMENT. TRUE
TO NEUBERGER& BERMAN'S PRINCIPLES, PORTFOLIO CANDIDATES MUST FIRST BE
FOUND TO BE FUNDAMENTALLY ATTRACTIVE. THEN, AND ONLY THEN, ARE SOCIAL
SCREENS APPLIED. THE OBJECTIVE IS SIMPLE AND STRAIGHTFORWARD -- TO SERVE
BOTH SOCIETY AND SHAREHOLDERS.
For the six-month period concluding February 28, 1998, NYCDC Socially
Responsive Trust returned 13.92% compared to the Standard & Poor's 500 Index's
17.64% gain.*
In this six month reporting period, the portfolio's telecommunications
holdings performed well, highlighted by Southwestern Bell's pending acquisition
of Southern New England Telephone and Wall Street's favorable appraisal of
WorldCom's proposed acquisition of MCI. We think the MCI deal makes great
strategic sense, as well as being potentially additive to earnings and cash
flow. We believe the combined entity would be well positioned to achieve strong
growth from voice and data services, as well as realize large cost efficiencies.
Portfolio positions in pharmaceutical companies also contributed to performance,
with strong earnings and some high profile mergers focusing attention on the
group. Our insurance holdings also continued to perform well.
Our technology company holdings restrained performance. Currency turmoil and
the prospect for Asian economic deceleration sent investors scurrying from
technology stocks in calendar fourth quarter 1997. Tech stocks rebounded in
early 1998, but remain well below their 52-week highs. We believe the sell-off
in technology stocks has been
A-5
<PAGE>
- ----------------------------------------------------------------------
NYCDC Socially Responsive Trust (Cont'd)
somewhat indiscriminate and that the longer-term earnings prospects even for
those portfolio companies legitimately impacted by Asian economic weakness
remain quite good.
Oil service, energy exploration and production companies had some of the
greatest negative impact on the portfolio. As is evidenced by the price of oil
at a five-year low, there is currently too much oil in the marketplace. However,
we believe this is the result of short-term factors -- El Nino's warm winter,
increased OPEC production, and the reduction of energy inventory in the Far
East. Looking ahead, we don't think we will be blessed by another extremely
temperate winter. It certainly isn't in OPEC's best interest to see oil prices
stay at currently depressed levels. Finally, at some point, Asian inventories
will have to be rebuilt. So, we expect oil prices to firm in the year ahead.
Most importantly, in a world with only 2-3% of excess production capacity, we
doubt the industry will stop drilling and risk letting the well run dry. Our
opinion is that lower oil prices or not, energy companies are going to have to
continue poking holes in the ground. Also, consolidation has begun in the oil
services group, with one of our holdings, Dresser Industries, just recently
agreeing to merge with Halliburton, and climbing 16.4% upon announcement of the
merger.
In this report, we've chosen to highlight Fannie Mae as the stock that
demonstrates our value-oriented investment discipline and fulfills our mandate
to own socially responsible companies. Fannie Mae stock has done quite well by
us, appreciating more than 40% over the last six months. At its current price,
it is no longer a steal. However, we still view it as fundamentally attractive.
We think Fannie Mae management has done an exceptional job managing interest
rate and political risk, while having delivered consistent double-digit earnings
gains.
As a provider of home mortgages for low- to moderate-income households, Fannie
Mae's main product assists the economically disadvantaged. The company also has
a strong record in the area of diversity, with representation of women and
minorities throughout its business. Supporting its employees, the company offers
extensive family-friendly
A-6
<PAGE>
- ----------------------------------------------------------------------
NYCDC Socially Responsive Trust (Cont'd)
benefits. Finally, Fannie Mae has been recognized for its innovative giving
programs focused on affordable housing and community economic development. We
view Fannie Mae as an ideal portfolio holding -- a strong business that can
reward shareholders and one that serves the community and its employees well.
Remember, this and the other securities mentioned in this report are not
recommendations, and our opinion on all stocks in the portfolio may change
without notice.
In closing, we think weakness in our technology, oil services, and energy
exploration and production holdings will turn into portfolio strengths in the
year ahead. We believe our value focus and sensitivity to social issues will
continue to reward shareholders and the community.
Sincerely,
/s/ Janet Prindle
Janet Prindle
PORTFOLIO MANAGER
*The S&P "500" Index is an unmanaged index generally considered to be
representative of stock market activity. Please note that indices do not take
into account any fees and expenses of investing in the individual securities
that they track, and that individuals cannot invest directly in any index. Data
about the performance of this index are prepared or obtained by
Neuberger&Berman Management Inc. and include reinvestment of all dividends and
capital gain distributions. The portfolio invests in many securities not
included in the above-described index.
The composition, industries and holdings of the portfolio are subject to
change. Socially Responsive Portfolio is invested in a wide array of stocks and
no single holding makes up more than a small fraction of the portfolio's total
assets.
Past performance is no guarantee of future results.
A-7
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
Neuberger&Berman
- ----------------------------------------------------------------------
NYCDC Socially Responsive Trust
<TABLE>
<CAPTION>
February 28,
1998
(000'S OMITTED EXCEPT PER SHARE AMOUNT) (UNAUDITED)
--------------
<S> <C>
ASSETS
Investment in Portfolio, at value (Note A) $ 223,158
Receivable for Trust shares sold 164
Deferred organization costs (Note A) 10
--------------
223,332
--------------
LIABILITIES
Payable for Trust shares redeemed 216
Accrued expenses 30
Payable to administrator -- net (Note B) 1
--------------
247
--------------
NET ASSETS at value $ 223,085
--------------
NET ASSETS consist of:
Par value $ 12
Paid-in capital in excess of par value 144,096
Accumulated undistributed net investment income 331
Accumulated net realized gains on investment 10,780
Net unrealized appreciation in value of investment 67,866
--------------
NET ASSETS at value $ 223,085
--------------
SHARES OUTSTANDING
($.001 par value; unlimited shares authorized) 11,736
--------------
NET ASSET VALUE, offering and redemption price per share $19.01
--------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
B-1
<PAGE>
STATEMENT OF OPERATIONS
Neuberger&Berman
- ----------------------------------------------------------------------
NYCDC Socially Responsive Trust
<TABLE>
<CAPTION>
For the
Six Months
Ended
February 28,
1998
(000'S OMITTED) (UNAUDITED)
------------
<S> <C>
INVESTMENT INCOME
Investment income from Portfolio (Note A) $ 1,537
------------
Expenses:
Administration fee (Note B) 50
Shareholder reports 10
Registration and filing fees 10
Shareholder servicing agent fees 9
Custodian fees 5
Amortization of deferred organization and initial offering
expenses (Note A) 5
Legal fees 5
Trustees' fees and expenses 3
Auditing fees 1
Miscellaneous 1
Expenses from Portfolio (Notes A & B) 615
------------
Total expenses 714
Expenses reimbursed by administrator and reduced by custodian
fee expense offset arrangement (Note B) (109)
------------
Total net expenses 605
------------
Net investment income 932
------------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS FROM PORTFOLIO (NOTE A)
Net realized gain on investment securities 11,663
Change in net unrealized appreciation of investment securities 14,275
------------
Net gain on investments from Portfolio (Note A) 25,938
------------
Net increase in net assets resulting from operations $ 26,870
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
B-2
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
Neuberger&Berman
- ----------------------------------------------------------------------
NYCDC Socially Responsive Trust
<TABLE>
<CAPTION>
For the
Six Months For the
Ended Year
February 28, Ended
1998 August 31,
(000'S OMITTED) (UNAUDITED) 1997
-----------------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income $ 932 $ 1,726
Net realized gain on investments from Portfolio (Note A) 11,663 9,823
Change in net unrealized appreciation of investments from
Portfolio (Note A) 14,275 32,327
-----------------------------
Net increase in net assets resulting from operations 26,870 43,876
-----------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (1,772) (1,442)
Net realized gain on investments (8,871) (10,729)
-----------------------------
Total distributions to shareholders (10,643) (12,171)
-----------------------------
FROM TRUST SHARE TRANSACTIONS:
Proceeds from shares sold 22,816 44,262
Proceeds from reinvestment of dividends and distributions 10,642 12,171
Payments for shares redeemed (15,463) (24,911)
-----------------------------
Net increase from Trust share transactions 17,995 31,522
-----------------------------
NET INCREASE IN NET ASSETS 34,222 63,227
NET ASSETS:
Beginning of period 188,863 125,636
-----------------------------
End of period $ 223,085 $ 188,863
-----------------------------
Accumulated undistributed net investment income at
end of period $ 331 $ 1,171
-----------------------------
NUMBER OF TRUST SHARES:
Sold 1,256 2,775
Issued on reinvestment of dividends and distributions 620 812
Redeemed (857) (1,582)
-----------------------------
Net increase in shares outstanding 1,019 2,005
-----------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
B-3
<PAGE>
NOTES TO FINANCIAL STATEMENTS
Neuberger&Berman February 28, 1998 (Unaudited)
- ----------------------------------------------------------------------
Equity Trust
NOTE A -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
1) GENERAL: Neuberger&Berman NYCDC Socially Responsive Trust-SM- (the "Fund") is
a separate operating series of Neuberger&Berman Equity Trust (the "Trust"), a
Delaware business trust organized pursuant to a Trust Instrument dated May 6,
1993. The Trust is registered as a diversified, open-end management
investment company under the Investment Company Act of 1940, as amended, and
its shares are registered under the Securities Act of 1933, as amended. The
trustees of the Trust may establish additional series or classes of shares
without the approval of shareholders.
The assets of each series belong only to that series, and the liabilities
of each series are borne solely by that series and no other.
The Fund seeks to achieve its investment objective by investing all of its
net investable assets in the Neuberger&Berman Socially Responsive Portfolio
of Equity Managers Trust (the "Portfolio") having the same investment
objective and policies as the Fund. The value of the Fund's investment in the
Portfolio reflects the Fund's proportionate interest in the net assets of the
Portfolio (70.49% at February 28, 1998). The Fund was created as an
investment vehicle for participants in the Deferred Compensation Plan of the
City of New York and Related Agencies and Instrumentalities. The performance
of the Fund is directly affected by the performance of the Portfolio. The
financial statements of the Portfolio, including the Schedule of Investments,
are included elsewhere in this report and should be read in conjunction with
the Fund's financial statements.
2) PORTFOLIO VALUATION: The Fund records its investment in the Portfolio at
value. Investment securities held by the Portfolio are valued by Equity
Managers Trust as indicated in the notes following the Portfolio's Schedule
of Investments.
3) FEDERAL INCOME TAXES: Each series of the Trust is treated as a separate
entity for Federal income tax purposes. It is the policy of the Fund to
continue to qualify as a regulated investment company by complying with the
provisions available to certain investment companies, as defined in
applicable sections of the Internal Revenue Code, and to make distributions
of investment company taxable income and net capital gains (after reduction
for any amounts available for Federal income tax purposes as capital loss
carryforwards) sufficient to relieve it from all, or substantially all,
Federal income taxes. Accordingly, the Fund paid no Federal income taxes and
no provision for Federal income taxes was required.
4) DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS: The Fund earns income, net of
Portfolio expenses, daily on its investment in the Portfolio. Income
dividends
B-4
<PAGE>
and distributions from net realized capital gains, if any, are normally
distributed in December. Income dividends and capital gain distributions to
shareholders are recorded on the ex-dividend date. To the extent the Fund's
net realized capital gains, if any, can be offset by capital loss
carryforwards, it is the policy of the Fund not to distribute such gains.
The Fund distinguishes between dividends on a tax basis and a financial
reporting basis and only distributions in excess of tax basis earnings and
profits are reported in the financial statements as a return of capital.
Differences in the recognition or classification of income between the
financial statements and tax earnings and profits which result in temporary
over-distributions for financial statement purposes are classified as
distributions in excess of net investment income or accumulated net realized
gains.
5) ORGANIZATION EXPENSES: Expenses incurred by the Fund in connection with its
organization are being amortized on a straight-line basis over a five-year
period. At February 28, 1998, the unamortized balance of such expenses
amounted to $9,901.
6) EXPENSE ALLOCATION: The Fund bears all costs of its operations. Expenses
incurred by the Trust with respect to any two or more funds are allocated in
proportion to the net assets of such funds, except where a more appropriate
allocation of expenses to each fund can otherwise be made fairly. Expenses
directly attributable to a fund are charged to that fund.
7) OTHER: All net investment income and realized and unrealized capital gains
and losses of the Portfolio are allocated pro rata among its respective funds
and any other investors in the Portfolio.
NOTE B -- ADMINISTRATION FEES, DISTRIBUTION ARRANGEMENTS, AND OTHER TRANSACTIONS
WITH AFFILIATES:
The Fund retains Neuberger&Berman Management Incorporated-Registered
Trademark- ("N&B Management") as its administrator under an Administration
Agreement ("Agreement") dated as of March 11, 1994. Pursuant to this Agreement
the Fund pays N&B Management an administration fee at the annual rate of 0.05%
of the Fund's average daily net assets. The Fund indirectly pays for investment
management services through its investment in the Portfolio (see Note B of Notes
to Financial Statements of the Portfolio).
N&B Management has voluntarily undertaken to reimburse the Fund for its
operating expenses and its pro rata share of the Portfolio's operating expenses
(including the fees payable to N&B Management but excluding interest, taxes,
brokerage commissions, and extraordinary expenses) which exceed, in the
aggregate, 0.60% per annum of the Fund's average daily net assets. This
undertaking is subject to termination by N&B Management upon at least 60 days'
prior written notice to the Fund. For the six months ended February 28, 1998,
such excess expenses amounted to $108,713.
B-5
<PAGE>
All of the capital stock of N&B Management is owned by individuals who are
also principals of Neuberger&Berman, LLC ("Neuberger"), a member firm of The New
York Stock Exchange and sub-adviser to the Portfolio. Several individuals who
are officers and/or trustees of the Trust are also principals of Neuberger
and/or officers and/or directors of N&B Management.
The Fund also has a distribution agreement with N&B Management. N&B
Management receives no compensation therefor and no commissions for sales or
redemptions of shares of beneficial interest of the Fund.
The Portfolio has an expense offset arrangement in connection with its
custodian contract. The impact of this arrangement, reflected in the Statement
of Operations under the caption Expenses from Portfolio, was a reduction of $76.
NOTE C -- INVESTMENT TRANSACTIONS:
During the six months ended February 28, 1998, additions and reductions in
the Fund's investment in the Portfolio amounted to $13,857,863 and $6,376,869,
respectively.
NOTE D -- UNAUDITED FINANCIAL INFORMATION:
The financial information included in this interim report is taken from the
records of the Fund without audit by independent accountants. Annual reports
contain audited financial statements.
B-6
<PAGE>
FINANCIAL HIGHLIGHTS
Neuberger&Berman
- --------------------------------------------------------------------------------
NYCDC Socially Responsive Trust
The following table includes selected data for a share outstanding throughout
each period and other performance information derived from the Financial
Statements. The per share amounts and ratios which are shown reflect income and
expenses, including the Fund's proportionate share of the Portfolio's income and
expenses. It should be read in conjunction with the Portfolio's Financial
Statements and notes thereto.
<TABLE>
<CAPTION>
For the For the
Six Months Ended Period from
February 28, For the Year Ended March 14, 1994(1)
1998 August 31, to August 31,
(UNAUDITED) 1997 1996 1995 1994
------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $17.62 $14.42 $12.27 $10.43 $10.20
------------------------------------------------------------
Income From Investment Operations
Net Investment Income .08 .17 .14 .13 .06
Net Gains or Losses on Securities (both realized and
unrealized) 2.27 4.38 2.44 1.82 .17
------------------------------------------------------------
Total From Investment Operations 2.35 4.55 2.58 1.95 .23
------------------------------------------------------------
Less Distributions
Dividends (from net investment income) (.16) (.16) (.12) (.11) --
Distributions (from net capital gains) (.80) (1.19) (.31) -- --
------------------------------------------------------------
Total Distributions (.96) (1.35) (.43) (.11) --
------------------------------------------------------------
Net Asset Value, End of Period $19.01 $17.62 $14.42 $12.27 $10.43
------------------------------------------------------------
Total Return(2) +13.92%(3) +33.20% +21.27% +18.95% +2.26%(3)
------------------------------------------------------------
Ratios/Supplemental Data
Net Assets, End of Period (in millions) $223.1 $188.9 $125.6 $ 88.5 $ 68.6
------------------------------------------------------------
Ratio of Gross Expenses to Average Net Assets(4) .60%(6) .60% .60% -- --
------------------------------------------------------------
Ratio of Net Expenses to Average Net Assets(5) .60%(6) .60% .60% .60% .60%(6)
------------------------------------------------------------
Ratio of Net Investment Income to Average Net Assets(5) .93%(6) 1.11% 1.06% 1.26% 1.42%(6)
------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL HIGHLIGHTS
B-7
<PAGE>
NOTES TO FINANCIAL HIGHLIGHTS
Neuberger&Berman February 28, 1998 (Unaudited)
- ----------------------------------------------------------------------
NYCDC Socially Responsive Trust
1) The date investment operations commenced.
2) Total return based on per share net asset value reflects the effects of
changes in net asset value on the performance of the Fund during each fiscal
period and assumes dividends and other distributions, if any, were
reinvested. Results represent past performance and do not guarantee future
results. Investment returns and principal may fluctuate and shares when
redeemed may be worth more or less than original cost. Total return would
have been lower if N&B Management had not reimbursed certain expenses.
3) Not annualized.
4) For fiscal periods ending after September 1, 1995, the Fund is required to
calculate an expense ratio without taking into consideration any expense
reductions related to expense offset arrangements. These ratios include
expense reimbursement arrangements.
5) After reimbursement of expenses by N&B Management as described in Note B of
Notes to Financial Statements. Had N&B Management not undertaken such action
the annualized ratios of net expenses and net investment income to average
daily net assets would have been:
<TABLE>
<CAPTION>
For the
For the For the Period from
Six Months Ended Year Ended March 14, 1994
February 28, August 31, to August 31,
1998 1997 1996 1995 1994
- ------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Expenses .71% .73% .80% .85% .84%
----------------------------------------------------
Net Investment Income .82% .98% .86% 1.01% 1.18%
----------------------------------------------------
</TABLE>
6) Annualized.
B-8
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman February 28, 1998 (Unaudited)
- --------------------------------------------------------------------------------
Socially Responsive Portfolio
<TABLE>
<CAPTION>
TOP TEN EQUITY HOLDINGS
---------------------------------------------------
HOLDING PERCENTAGE
<C> <S> <C>
1. A.G. Edwards 2.8%
2. Warner-Lambert 2.5%
3. ReliaStar Financial 2.4%
4. Hasbro, Inc. 2.3%
5. Southern New England
Telecommunications 2.3%
6. Wal-Mart Stores 2.2%
7. WorldCom Inc. 2.2%
8. Intel Corp. 2.2%
9. Ambac Financial Group 2.2%
10. Cincinnati Milacron 2.1%
</TABLE>
<TABLE>
<CAPTION>
Market
Value(1)
Number (000's
of Shares omitted)
- ---------- -------------
<C> <S> <C>
COMMON STOCKS (94.2%)
ADVERTISING (2.0%)
240,000 True North Communications $ 6,195
-------------
AUTOMOTIVE (1.8%)
100,000 Borg-Warner Automotive 5,863
-------------
BANKING (9.6%)
45,000 CITICORP 5,962
200,000 Dime Bancorp 6,100
105,000 Mercantile Bancorporation 5,841
90,000 National City 5,873
165,000 Southtrust Corp. 6,744
-------------
30,520
-------------
CHEMICALS (4.6%)
140,300 Dexter Corp. 5,700
60,000 Minerals Technologies 2,865
80,000 Perkin-Elmer 5,855
-------------
14,420
-------------
<CAPTION>
Market
Value(1)
Number (000's
of Shares omitted)
- ---------- -------------
<C> <S> <C>
CONSUMER GOODS & SERVICES
(5.5%)
200,000 Hasbro, Inc. $ 7,262
120,000 Kimberly-Clark 6,682
40,000 Procter & Gamble 3,398
-------------
17,342
-------------
DIVERSIFIED (3.4%)
53,000 Minnesota Mining & Manufacturing 4,522
120,000 Tyco International 6,090
-------------
10,612
-------------
ENERGY (1.5%)
120,000 Noble Affiliates 4,680
-------------
FINANCIAL SERVICES (9.6%)
210,000 A.G. Edwards 8,833
68,400 ADVANTA Corp. Class A 1,612
36,480 ADVANTA Corp. Class B 802
128,000 Ambac Financial Group 6,816
100,000 Fannie Mae 6,381
105,000 Travelers Group 5,854
-------------
30,298
-------------
FOOD & BEVERAGE (1.7%)
100,000 McDonald's Corp. 5,475
-------------
FURNISHINGS (1.7%)
110,000 Leggett & Platt 5,521
-------------
HEALTH CARE (9.8%)
140,000 Biogen, Inc. 6,177
200,000 Invacare Corp. 4,588
80,000 Johnson & Johnson 6,040
100,000 SmithKline Beecham ADR 6,187
55,000 Warner-Lambert 8,044
-------------
31,036
-------------
</TABLE>
B-9
<PAGE>
SCHEDULE OF INVESTMENTS
Neuberger&Berman February 28, 1998 (Unaudited)
- --------------------------------------------------------------------------------
Socially Responsive Portfolio (Cont'd)
<TABLE>
<CAPTION>
Market
Value(1)
Number (000's
of Shares omitted)
- ---------- -------------
<C> <S> <C>
INDUSTRIAL & COMMERCIAL PRODUCTS
(3.3%)
110,000 Corning Inc. $ 4,469
140,000 Raychem Corp. 6,081
-------------
10,550
-------------
INSURANCE (6.0%)
200,000 ESG Re 5,300
160,000 ReliaStar Financial 7,610
70,000 St. Paul Cos. 6,204
-------------
19,114
-------------
MACHINERY & EQUIPMENT (2.1%)
220,000 Cincinnati Milacron 6,792
-------------
OIL & GAS (1.2%)
220,000 Seagull Energy 3,713
-------------
OIL SERVICES (3.0%)
120,000 Dresser Industries 5,362
90,000 Tidewater Inc. 4,005
-------------
9,367
-------------
PUBLISHING & BROADCASTING (3.2%)
188,200 CMP Media 4,446
150,000 Valassis Communications 5,719
-------------
10,165
-------------
RECYCLING (1.0%)
187,500 IMCO Recycling 3,246
-------------
RETAIL STORES (2.1%)
125,000 Sears, Roebuck 6,633
-------------
RETAILING (3.7%)
100,000 Costco Cos. 4,887
150,000 Wal-Mart Stores 6,947
-------------
11,834
-------------
TECHNOLOGY (7.5%)
110,000 AMP, Inc. 4,861
91,000 Hewlett-Packard 6,097
76,000 Intel Corp. 6,816
330,000 Unisys Corp. 5,899
-------------
23,673
-------------
<CAPTION>
Market
Value(1)
Number (000's
of Shares omitted)
- ---------- -------------
<C> <S> <C>
TELECOMMUNICATIONS (6.1%)
450,000 Metromedia International Group $ 5,119
114,000 Southern New England Telecommunications 7,196
180,000 WorldCom Inc. 6,874
-------------
19,189
-------------
UTILITIES, ELECTRIC & GAS (3.8%)
110,000 Cinergy Corp. 3,829
225,000 DPL Inc. 4,092
115,000 KeySpan Energy 4,090
-------------
12,011
-------------
TOTAL COMMON STOCKS (COST $209,454) 298,249
-------------
<CAPTION>
Principal
Amount
- ----------
<C> <S> <C>
U.S. TREASURY SECURITIES (4.7%)
$14,885,000 U.S. Treasury Bills, 4.97% & 5.245%, due
3/5/98 & 4/23/98 (COST $14,828) 14,828(2)
-------------
CERTIFICATES OF DEPOSIT (0.0%)
100,000 Self Help Credit Union, 5.20%, due 5/26/98
(COST $100) 100 (2)
-------------
TOTAL INVESTMENTS (98.9%) (COST $224,382) 313,177 (3)
Cash, receivables and other assets, less
liabilities (1.1%) 3,386
-------------
TOTAL NET ASSETS (100.0%) $ 316,563
-------------
</TABLE>
SEE NOTES TO SCHEDULE OF INVESTMENTS
B-10
<PAGE>
NOTES TO SCHEDULE OF INVESTMENTS
Neuberger&Berman February 28, 1998 (Unaudited)
- ----------------------------------------------------------------------
Socially Responsive Portfolio
1) Investment securities of the Portfolio are valued at the latest sales price;
securities for which no sales were reported, unless otherwise noted, are
valued at the mean between the closing bid and asked prices. The Portfolio
values all other securities by a method that the trustees of Equity Managers
Trust believe accurately reflects fair value. Foreign security prices are
furnished by independent quotation services expressed in local currency
values. Foreign security prices are translated from the local currency into
U.S. dollars using current exchange rates. Short-term debt securities with
less than 60 days until maturity may be valued at cost which, when combined
with interest earned, approximates market value.
2) At cost, which approximates market value.
3) The cost of investments for Federal income tax purposes was $224,409,000. At
February 28, 1998, gross unrealized appreciation of investments was
$91,974,000 and gross unrealized depreciation of investments was $3,206,000,
resulting in net unrealized appreciation of $88,768,000, based on cost for
Federal income tax purposes.
SEE NOTES TO FINANCIAL STATEMENTS
B-11
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
Neuberger&Berman
- ----------------------------------------------------------------------
Socially Responsive Portfolio
<TABLE>
<CAPTION>
February 28,
1998
(000'S OMITTED) (UNAUDITED)
--------------
<S> <C>
ASSETS
Investments in securities, at market value*
(Note A) -- see Schedule of Investments $ 313,177
Cash 2
Receivable for securities sold 3,165
Dividends and interest receivable 379
Deferred organization costs (Note A) 7
Prepaid expenses and other assets 4
--------------
316,734
--------------
LIABILITIES
Payable to investment manager (Note B) 136
Accrued expenses 35
--------------
171
--------------
NET ASSETS Applicable to Investors' Beneficial Interests $ 316,563
--------------
NET ASSETS consist of:
Paid-in capital $ 227,768
Net unrealized appreciation in value of investment
securities 88,795
--------------
NET ASSETS $ 316,563
--------------
*Cost of investments $ 224,382
--------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
B-12
<PAGE>
STATEMENT OF OPERATIONS
Neuberger&Berman
- ----------------------------------------------------------------------
Socially Responsive Portfolio
<TABLE>
<CAPTION>
For the
Six Months
Ended
February 28,
1998
(000'S OMITTED) (UNAUDITED)
------------
<S> <C>
INVESTMENT INCOME
Income:
Dividend income $ 1,805
Interest income 332
Foreign taxes withheld (Note A) (5)
------------
Total income 2,132
------------
Expenses:
Investment management fee (Note B) 763
Custodian fees (Note B) 51
Legal fees 12
Auditing fees 12
Accounting fees 5
Trustees' fees and expenses 4
Amortization of deferred organization and initial
offering expenses (Note A) 3
Insurance expense 2
------------
Total expenses 852
------------
Net investment income 1,280
------------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS
Net realized gain on investment securities sold 14,653
Change in net unrealized appreciation of investment
securities 21,509
------------
Net gain on investments 36,162
------------
Net increase in net assets resulting from operations $ 37,442
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
B-13
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
Neuberger&Berman
- ----------------------------------------------------------------------
Socially Responsive Portfolio
<TABLE>
<CAPTION>
For the
Six Months For the
Ended Year
February 28, Ended
1998 August 31,
(000'S OMITTED) (UNAUDITED) 1997
-----------------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income $ 1,280 $ 2,214
Net realized gain on investments 14,653 11,478
Change in net unrealized appreciation of investments 21,509 44,043
-----------------------------
Net increase in net assets resulting from operations 37,442 57,735
-----------------------------
TRANSACTIONS IN INVESTORS' BENEFICIAL INTERESTS:
Additions 32,087 57,455
Reductions (9,247) (17,394)
-----------------------------
Net increase in net assets resulting from transactions
in investors' beneficial interests 22,840 40,061
-----------------------------
NET INCREASE IN NET ASSETS 60,282 97,796
NET ASSETS:
Beginning of period 256,281 158,485
-----------------------------
End of period $ 316,563 $ 256,281
-----------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
B-14
<PAGE>
NOTES TO FINANCIAL STATEMENTS
February 28, 1998 (Unaudited)
- ----------------------------------------------------------------------
Equity Managers Trust
NOTE A -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
1) GENERAL: Neuberger&Berman Socially Responsive Portfolio (the "Portfolio") is
a separate operating series of Equity Managers Trust ("Managers Trust"), a
New York common law trust organized as of December 1, 1992. Managers Trust is
registered as a diversified, open-end management investment company under the
Investment Company Act of 1940, as amended (the "1940 Act"). Other regulated
investment companies sponsored by Neuberger&Berman Management Incorporated
("N&B Management"), whose financial statements are not presented herein, also
invest in the Portfolio and other portfolios of Managers Trust.
The assets of each series belong only to that series, and the liabilities
of each series are borne solely by that series and no other.
2) PORTFOLIO VALUATION: Investment securities are valued as indicated in the
notes following the Portfolio's Schedule of Investments.
3) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities transactions are
recorded on a trade date basis. Dividend income is recorded on the
ex-dividend date or, for certain foreign dividends, as soon as the Portfolio
becomes aware of the dividends. Non-cash dividends included in dividend
income, if any, are recorded at the fair market value of the securities
received. Interest income, including accretion of original issue discount,
where applicable, and accretion of discount on short-term investments, is
recorded on the accrual basis. Realized gains and losses from securities
transactions are recorded on the basis of identified cost.
4) FEDERAL INCOME TAXES: Managers Trust intends to comply with the requirements
of the Internal Revenue Code. Each portfolio of Managers Trust also intends
to conduct its operations so that each of its investors will be able to
qualify as a regulated investment company. Each portfolio will be treated as
a partnership for Federal income tax purposes and is therefore not subject to
Federal income tax.
5) FOREIGN TAXES: Foreign taxes withheld represents amounts withheld by foreign
tax authorities, net of refunds recoverable.
6) ORGANIZATION EXPENSES: Expenses incurred by the Portfolio in connection with
its organization are being amortized by the Portfolio on a straight-line
basis over a five-year period. At February 28, 1998, the unamortized balance
of such expenses amounted to $6,989.
7) EXPENSE ALLOCATION: The Portfolio bears all costs of its operations. Expenses
incurred by Managers Trust with respect to any two or more portfolios are
B-15
<PAGE>
allocated in proportion to the net assets of such portfolios, except where a
more appropriate allocation of expenses to each portfolio can otherwise be
made fairly. Expenses directly attributable to a portfolio are charged to
that portfolio.
8) SECURITY LENDING: Portfolio securities loans involve certain risks in the
event a borrower should fail financially, including delays or inability to
recover the lent securities or foreclose against the collateral. The
investment manager, under the general supervision of Managers Trust's Board
of Trustees, monitors the creditworthiness of the parties to whom the
Portfolio makes security loans. The Portfolio will not lend securities on
which covered call options have been written, or lend securities on terms
which would prevent each of its investors from qualifying as a regulated
investment company. Portfolio securities loans to Neuberger&Berman, LLC
("Neuberger"), the Portfolio's principal broker and sub-adviser, are made in
accordance with an exemptive order issued by the Securities and Exchange
Commission under the 1940 Act. The Portfolio receives cash as collateral
against the lent securities, which must be maintained at not less than 100%
of the market value of the lent securities during the period of the loan. The
Portfolio receives income earned on the lent securities and a portion of the
income earned on the cash collateral. During the six months ended February
28, 1998, the Portfolio lent securities to Neuberger.
9) REPURCHASE AGREEMENTS: The Portfolio may enter into repurchase agreements
with institutions that the Portfolio's investment manager has determined are
creditworthy. Each repurchase agreement is recorded at cost. The Portfolio
requires that the securities purchased in a repurchase transaction be
transferred to the custodian in a manner sufficient to enable the Portfolio
to obtain those securities in the event of a default under the repurchase
agreement. The Portfolio monitors, on a daily basis, the value of the
securities transferred to ensure that their value, including accrued
interest, is greater than amounts owed to the Portfolio under each such
repurchase agreement.
NOTE B -- MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES:
The Portfolio retains N&B Management as its investment manager under a
Management Agreement dated as of March 11, 1994. For such investment management
services, the Portfolio pays N&B Management a fee at the annual rate of 0.55% of
the first $250 million of the Portfolio's average daily net assets, 0.525% of
the next $250 million, 0.50% of the next $250 million, 0.475% of the next $250
million, 0.45% of the next $500 million, and 0.425% of average daily net assets
in excess of $1.5 billion.
All of the capital stock of N&B Management is owned by individuals who are
also principals of Neuberger, a member firm of The New York Stock Exchange and
sub-adviser to the Portfolio. Neuberger is retained by N&B Management to furnish
it with investment recommendations and research information without added cost
to
B-16
<PAGE>
the Portfolio. Several individuals who are officers and/or trustees of Managers
Trust are also principals of Neuberger and/or officers and/or directors of N&B
Management.
The Portfolio has an expense offset arrangement in connection with its
custodian contract. The impact of this arrangement, reflected in the Statement
of Operations under the caption Custodian fees, was a reduction of $108.
NOTE C -- SECURITIES TRANSACTIONS:
During the six months ended February 28, 1998, there were purchase and sale
transactions (excluding short-term securities) of $89,435,007 and $71,045,986,
respectively.
During the six months ended February 28, 1998, brokerage commissions on
securities transactions amounted to $210,053, of which Neuberger received
$165,745, and other brokers received $44,308.
In addition, Neuberger's share of the total interest income earned for the
six months ended February 28, 1998, from the collateralization of securities
loaned to or through Neuberger was $10,833.
NOTE D -- UNAUDITED FINANCIAL INFORMATION:
The financial information included in this interim report is taken from the
records of the Portfolio without audit by independent accountants. Annual
reports contain audited financial statements.
B-17
<PAGE>
FINANCIAL HIGHLIGHTS
Neuberger&Berman
- --------------------------------------------------------------------------------
Socially Responsive Portfolio
<TABLE>
<CAPTION>
For the
Six Months For the
Ended Period from
February 28, March 14, 1994(1)
1998 For the Year Ended August 31, to August 31,
(UNAUDITED) 1997 1996 1995 1994
------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
RATIOS TO AVERAGE NET ASSETS:
Gross Expenses(2) .61%(3) .63% .65% -- --
------------------------------------------------------------------------
Net Expenses .61%(3) .63% .65% .68% .69%(3)
------------------------------------------------------------------------
Net Investment Income .92%(3) 1.08% 1.02% 1.18% 1.33%(3)
------------------------------------------------------------------------
Portfolio Turnover Rate 26% 51% 53% 58% 14%
------------------------------------------------------------------------
Average Commission Rate Paid $0.0550 $0.0568 $0.0587 -- --
------------------------------------------------------------------------
Net Assets, End of Period (in millions) $316.6 $256.3 $158.5 $96.7 $70.7
------------------------------------------------------------------------
</TABLE>
1) The date investment operations commenced.
2) For fiscal periods ending after September 1, 1995, the Portfolio is required
to calculate an expense ratio without taking into consideration any expense
reductions related to expense offset arrangements.
3) Annualized.
B-18
<PAGE>
DIRECTORY
INVESTMENT MANAGER, ADMINISTRATOR
AND DISTRIBUTOR
Neuberger&Berman Management Incorporated
605 Third Avenue 2nd Floor
New York, NY 10158-0180
800-877-9700
Institutional Services 800-366-6264
SUB-ADVISER
Neuberger&Berman, LLC
605 Third Avenue
New York, NY 10158-3698
CUSTODIAN AND SHAREHOLDER
SERVICING AGENT
State Street Bank and Trust Company
225 Franklin Street
Boston, MA 02110
ADDRESS CORRESPONDENCE TO:
Deferred Compensation Plan of the
City of New York and Related Agencies
and Instrumentalities
40 Rector Street 3rd Floor
New York, NY 10006
212-306-7760
LEGAL COUNSEL
Kirkpatrick & Lockhart LLP
1800 Massachusetts Avenue, NW
2nd Floor
Washington, DC 20036-1800
Neuberger&Berman Management Inc. and Neuberger&Berman NYCDC Socially Responsive
Trust are service marks of Neuberger&Berman Management Inc.
- -C- 1998 Neuberger&Berman Management Inc.
C-1
<PAGE>
OFFICERS AND TRUSTEES
Stanley Egener
CHAIRMAN OF THE BOARD AND TRUSTEE
Lawrence Zicklin
PRESIDENT AND TRUSTEE
Faith Colish
TRUSTEE
Howard A. Mileaf
TRUSTEE
Edward I. O'Brien
TRUSTEE
John T. Patterson, Jr.
TRUSTEE
John P. Rosenthal
TRUSTEE
Cornelius T. Ryan
TRUSTEE
Gustave H. Shubert
TRUSTEE
Daniel J. Sullivan
VICE PRESIDENT
Michael J. Weiner
VICE PRESIDENT
Richard Russell
TREASURER
Claudia A. Brandon
SECRETARY
Barbara DiGiorgio
ASSISTANT TREASURER
Celeste Wischerth
ASSISTANT TREASURER
Stacy Cooper-Shugrue
ASSISTANT SECRETARY
C. Carl Randolph
ASSISTANT SECRETARY
C-2
<PAGE>
Neuberger&Berman Management Inc.-Registered Trademark-
605 THIRD AVENUE 2ND FLOOR
NEW YORK, NY 10158-0180
SHAREHOLDER SERVICES
800-877-9700
INSTITUTIONAL SERVICES
800-366-6264
WWW.NBFUNDS.COM
Statistics and projections in this report are derived from sources
deemed to be reliable but cannot be regarded as a representation of
future results of the Fund. This report is prepared for the
general information of shareholders and is not an offer of shares
of the Fund. Shares are sold only through the currently
effective prospectus, which must precede or accompany this report.
[LOGO] PRINTED ON RECYCLED PAPER NBNYCAR30298
KIRKPATRICK & LOCKHART LLP
1800 MASSACHUSETTS AVENUE, N.W.
2ND FLOOR
WASHINGTON, D.C. 10036-1800
TELEPHONE (202) 778-9000
FACSIMILE (202) 778-9100
May 4, 1998
VIA EDGAR
- ---------
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: Neuberger & Berman Equity Trust:
Neuberger & Berman NYCDC Socially Responsive Trust
1933 Act File No. 33-64368
1940 Act File No. 811-7784
--------------------------------------------------
Dear Sir or Madam:
Transmitted herewith for filing is the Semi-Annual Report to
Shareholders of the above-referenced series of Neuberger & Berman Equity Trust
for the period ended February 28, 1998. This filing is being made pursuant to
Section 30(b)(2) of the Investment Company Act of 1940, as amended, and Rule
30b2-1 thereunder.
If you should have any questions regarding this filing, please contact
the undersigned.
Sincerely,
/s/ Lori L. Schneider
--------------------------
Lori L. Schneider
Enclosures
