MERRILL LYNCH
AMERICAS INCOME
FUND, INC.
FUND LOGO
Annual Report
December 31, 1995
The Fund is leveraged to provide shareholders with a potentially
higher rate of return. However, leveraging may exaggerate changes in
the net asset value of the Fund's shares and in the yield on the
Fund's portfolio.
Investing in emerging market securities involves a number of risk
factors and special considerations, including restrictions on
foreign investments and on repatriation of capital invested in
emerging markets, currency fluctuations, and potential price
volatility and less liquidity of securities traded in emerging
markets. In addition, there may be less publicly available
information about the issuers of securities, and such issuers may
not be subject to accounting, auditing and financial reporting
standards and requirements comparable to those to which US companies
are subject. Therefore, the Fund is designed as a long-term
investment for investors capable of assuming the risks of investing
in emerging markets. The Fund should be considered as a vehicle for
diversi-fication and not as a complete investment program. Please
refer to the prospectus for details.
<PAGE>
This report is not authorized for use as an offer of sale or a
solicitation of an offer to buy shares of the Fund unless
accompanied or preceded by the Fund's current prospectus. Past
performance results shown in this report should not be considered a
representation of future performance. Investment return and
principal value of shares will fluctuate so that shares, when
redeemed, may be worth more or less than their original cost.
Statements and other information herein are as dated and are subject
to change.
Merrill Lynch
Americas Income Fund, Inc.
Box 9011
Princeton, NJ
08543-9011
MERRILL LYNCH AMERICAS INCOME FUND, INC.
The Benefits and
Risks of
Leveraging
The Fund is authorized to borrow money from banks in an amount up to
33 1/3% of the Fund's total assets (including the amount borrowed),
less all liabilities and indebtedness other than the bank borrowing.
The Fund is also authorized to borrow an additional 5% of its total
assets without regard to this limitation for temporary purposes.
<PAGE>
Borrowings by the Fund create an opportunity for greater total
return but, at the same time, increase exposure to capital risk. For
example, leveraging may exaggerate changes in the net asset value of
Fund shares and in the yield on the Fund's portfolio. Although the
principal of such borrowings will be fixed, the Fund's assets may
change in value during the time the borrowings are outstanding.
Borrowing will create interest expenses for the Fund that can exceed
the income from the assets retained. To the extent the income
derived from securities purchased with borrowed funds exceeds the
interest the Fund will have to pay, the Fund's net income will be
greater than if borrowing were not used. Conversely, if the income
from the assets retained with borrowed funds is not sufficient to
cover the cost of borrowing, the net income of the Fund will be
less than if borrowing were not used, and therefore the amount
available for distribution to shareholders as dividends will be
reduced.
Officers and
Directors
Arthur Zeikel, President and Director
Donald Cecil, Director
Edward H. Meyer, Director
Charles C. Reilly, Director
Richard R. West, Director
Edward D. Zinbarg, Director
Terry K. Glenn, Executive Vice President
Joseph T. Monagle, Jr., Senior Vice President
Alex V. Bouzakis, Vice President
Donald C. Burke, Vice President
Paolo H. Valle, Vice President
Gerald M. Richard, Treasurer
Mark B. Goldfus, Secretary
Custodian
Brown Brothers Harriman & Co.
40 Water Street
Boston, Massachusetts 02109
Transfer Agent
Merrill Lynch Financial Data Services, Inc.
Transfer Agency Mutual Fund Operations
4800 Deer Lake Drive East
Jacksonville, Florida 32246-6484
(800) 637-3863
<PAGE>
DEAR SHAREHOLDER
During the fourth quarter of 1995, the positive interest rate
environment and strong US dollar provided a strong support to
emerging markets debt. In December, the expectations of further
lower interest rates and the possibility of a balanced budget
agreement in the United States, along with improving credit
fundamentals of major Latin American countries attracted investors
to emerging markets in search of higher yields.
Investment Environment
Mexico
During 1995, the Mexican government was significantly successful on
three counts. First, the government paid off all of its government
and private sector maturing obligations, avoiding any debt default.
Second, the current account deficit was largely brought into
balance. Finally, congress passed the social security reform, which
is expected to be implemented by the fourth quarter of 1996. This
reform will be a significant source of internal savings for the
country.
The Mexican investment environment was very volatile during the last
quarter of 1995. The stock market hit a low of 2,187, Eurobond and
Brady bond spreads widened, the peso fell to 8.25 to the US dollar,
and local interest rates increased as the benchmark 28-day Cetes
rate increased to 60%. This volatility largely was caused by the
Mexican authorities' attempt to revive the country's ailing economy
by easing money supply, which drew a massive speculative attack on
the peso. The peso weakened by 15%, prompting authorities to
increase interest rates and intervene in the currency markets to
stabilize the peso. While the peso's weakness was the dominant issue
in November, there have been several positive developments in
Mexico.
Mexico continues to post healthy trade surpluses. Exports in 1996
are expected to reach $100 billion, up from approximately $80
billion in 1995. The trade surplus in the first 11 months of 1995
was $6.9 billion compared with a $16.8 billion deficit in 1994.
Recent economic data, such as employment and industrial production
statistics, indicate that the economy has begun to show signs of
growth. Mexico continues to have good access to global capital
markets as evidenced by the recent Cetes-linked Eurobond issue. This
issue was increased from $500 million to $1.5 billion to satisfy
investor demand. In total, Mexico was able to raise approximately
$5.5 billion in 1995 in the capital markets. The Zedillo
administration is trying to deepen economic and political reforms
and is doing a good job of executing its economic strategy, in our
opinion. While we will continue to monitor the banking system and
the corporate sector, we believe that Mexico will experience
accelerating economic growth in 1996. Our expectation is for 3% real
gross domestic product growth in 1996.
<PAGE>
Argentina
In Argentina, fears of a rift between President Menem and Finance
Minister Cavallo have subsided. Confidence is on the rise among
Argentines and is evidenced by positive price action in the bond and
equity markets. Economic data released in November indicate that the
economy is starting to turn up. Industrial and auto production are
showing growth. Unemployment in Argentina is dropping, and there is
talk of increased growth in consumer and business credit. The tax
amnesty program, which was expected to generate $1 billion in
potential revenues, produced $4 billion and generated 276,000 new
taxpayers. Argentina has continued to tap global capital markets,
successfully raising $2.5 billion during the past four months.
Foreign exchange reserves grew to $18.5 billion by year-end 1995,
the highest level since the Mexican peso crisis. Both reserves and
bank deposits, which are leading indicators of domestic confidence,
are higher than levels prior to the Mexican peso crisis.
Brazil
In Brazil, persistently high real interest rates have helped control
inflation and build international reserves by attracting foreign
investors. International reserves are approaching $50 billion. The
cost of maintaining these high real interest rates and the
sterilization of capital inflows has resulted in a build up of
internal debt. Management of the fiscal deficit, which deteriorated
during 1995, will be of critical importance in 1996. Progress toward
fiscal reform is essential for the continued success of Brazil's
economic stabilization plan. While a slowdown in the economy and
high real interest rates affected the credit quality of banks' loan
portfolios, the distress experienced by Banco Nacional and Banco
Economic were apparently the result of inadequate capitalization and
mismanagement. The reform process is moving slowly but steadily
toward ratification. The Cardoso administration has won ratification
on every reform vote thus far and seems to be handling the situation
satisfactorily. The focus now will be on pushing the fiscal
stabilization fund, privatizations and other tax-related reforms
early next year.
Investment Outlook
In the next three months, we expect US economic and monetary policy
to be supportive of the US bond market, the Federal Reserve Board to
permit further gradual easing of monetary policy, the economy to
grow below trend and inflation to be under control, and the US
dollar to remain strong and possibly continue to strengthen. In
addition, we expect politicians in the United States to reach an
agreement to balance the Federal budget; however, the ultimate
impact of the agreement on Federal deficit reduction is yet to be
analyzed. In Europe, the economies are expected to continue slowing
down and inflationary pressures to remain very subdued.
<PAGE>
While the global environment for bonds looks positive, it seems that
the US bond market has already discounted a more aggressive easing
by the Federal Reserve Board than may actually occur. Therefore,
lower yields will be much harder to reach in the absence of a severe
slowdown in the economy and with inflation dropping to 2% annually.
Consequently, during the next three months the risk is that
investors may be reassessing the US interest rate outlook.
In our view, the US bond market outlook is positive, but fairly
valued. We think that investors will continue to be attracted to
emerging markets debt in search of higher yields as the perception
is one of improving credit fundamentals.
Fiscal Year in Review
Fiscal year 1995 was a very interesting year for emerging markets
debt. Investors went from experiencing a severe confidence and
liquidity crisis in the first quarter to experiencing a bullish
investment sentiment in the last quarter.
During this difficult period, as we have been reporting to you
throughout the Fund's fiscal year, we remained focused on evidence
that indicated that these countries remained committed to market-
friendly economic and political reforms. Therefore, we remained
overweighted in the Latin America region. The oversold condition of
the debt of this region makes it very attractive. Within the region,
Brazil, Argentina and Mexico (in order of importance) were our main
investment allocations. We opted for Brady bonds and some of the
longer duration Eurobonds in response to their better liquidity. The
declining US interest rate environment and stronger US dollar
supported our decision. These strategies enhanced the Fund's total
return for the fiscal year. The Fund was 8.70% leveraged by year-
end.
Sincerely,
(Arthur Zeikel)
Arthur Zeikel
President
(Paolo Valle)
Paolo Valle
Vice President and Portfolio Manager
February 12, 1996
<PAGE>
PERFORMANCE DATA
About Fund
Performance
Investors are able to purchase shares of the Fund through the
Merrill Lynch Select Pricing SM System, which offers four pricing
alternatives:
* Class A Shares incur a maximum initial sales charge (front-end
load) of 4% and bear no ongoing distribution or account maintenance
fees. Class A Shares are available only to eligible investors, as
detailed in the Fund's prospectus. If you were a Class A shareholder
prior to October 21, 1994, your Class A Shares were redesignated to
Class D Shares on October 21, 1994, which, in the case of certain
eligible investors, were simultaneously exchanged for Class A
Shares.
* Class B Shares are subject to a maximum contingent deferred sales
charge of 4% if redeemed during the first year, decreasing 1% each
year thereafter to 0% after the fourth year. In addition, Class B
Shares are subject to a distribution fee of 0.50% and an account
maintenance fee of 0.25%. These shares automatically convert to
Class D Shares after approximately 10 years.
* Class C Shares are subject to a distribution fee of 0.55% and an
account maintenance fee of 0.25%. In addition, Class C Shares are
subject to a 1% contingent deferred sales charge if redeemed within
one year of purchase.
* Class D Shares incur a maximum initial sales charge of 4% and an
account maintenance fee of 0.25% (but no distribution fee).
None of the past results shown should be considered a representation
of future performance. Investment return and principal value of
shares will fluctuate so that shares, when redeemed, may be worth
more or less than their original cost. Dividends paid to each class
of shares will vary because of the different levels of account
maintenance, distribution and transfer agency fees applicable to
each class, which are deducted from the income available to be paid
to shareholders.
<PAGE>
PERFORMANCE DATA (continued)
Total Return
Based on a
$10,000
Investment
A line graph depicting the growth of an investment in the Fund's
Class A Shares and Class C Shares compared to growth of an investment
in the JP Morgan Latin Brady Bond Index. Beginning and ending values
are:
10/21/94** 12/95
ML Americas Income Fund, Inc.++--
Class A Shares*# $ 9,600 $11,674
ML Americas Income Fund, Inc.++--
Class C Shares* $10,000 $11,980
JP Morgan Latin Brady Bond Index++++ $10,000 $11,865
A line graph depicting the growth of an investment in the Fund's
Class B Shares and Class D Shares compared to growth of an investment
in the JP Morgan Latin Brady Bond Index. Beginning and ending values
are:
8/27/93** 12/95
ML Americas Income Fund, Inc.++--
Class B Shares* $10,000 $11,721
ML Americas Income Fund, Inc.++--
Class D Shares*# $ 9,600 $11,579
JP Morgan Latin Brady Bond Index++++ $10,000 $11,802
<PAGE>
[FN]
*Assuming maximum sales charge, transaction costs and other operating
expenses including advisory fees.
**Commencement of Operations.
#Class A Shares were redesignated to Class D Shares on October 21, 1994.
++ML Americas Income Fund, Inc. invests primarily in debt securities
denominated in a currency of a country located in the Western
Hemisphere (i.e., North and South America and the surrounding waters).
++++This unmanaged Index is comprised of dollar-denominated restructured
sovereign bonds, the securities created through the restructuring of
commercial bank debt. It includes a large percentage of Brady bonds.
Past performance is not predictive of future performance.
Average Annual
Total Return
% Return Without % Return With
Sales Charge Sales Charge**
Class A Shares*
Year Ended 12/31/95 +27.27% +22.18%
Inception (10/21/94) through 12/31/95 +17.80 +13.84
[FN]
*Maximum sales charge is 4%.
**Assuming maximum sales charge.
% Return % Return
Without CDSC With CDSC**
Class B Shares*
Year Ended 12/31/95 +26.10% +22.10%
Inception (8/27/93) through 12/31/95 + 7.77 + 7.01
[FN]
*Maximum contingent deferred sales charge is 4% and is reduced to 0%
after 4 years.
**Assuming payment of applicable contingent deferred sales charge.
<PAGE>
% Return % Return
Without CDSC With CDSC**
Class C Shares*
Year Ended 12/31/95 +26.18% +25.18%
Inception (10/21/94) through 12/31/95 +16.33 +16.33
[FN]
*Maximum contingent deferred sales charge is 1% and is reduced to 0%
after 1 year.
**Assuming payment of applicable contingent deferred sales charge.
% Return Without % Return With
Sales Charge Sales Charge**
Class D Shares*
Year Ended 12/31/95 +26.75% +21.68%
Inception (8/27/93) through 12/31/95 + 8.32 + 6.45
[FN]
*Maximum sales charge is 4%.
**Assuming maximum sales charge.
<TABLE>
Performance
Summary--
Class A Shares***
<CAPTION>
Net Asset Value Capital Gains
Period Covered Beginning Ending Distributed Dividends Paid* % Change**
<C> <C> <C> <C> <C> <C>
10/21/94--12/31/94 $9.08 $8.51 -- $0.168 - 4.45%
1995 8.51 9.70 -- 0.944 +27.27
------
Total $1.112
Cumulative total return as of 12/31/95: +21.61%**
<FN>
*Figures may include short-term capital gains distributions.
**Figures assume reinvestment of all dividends and capital gains
distributions at net asset value on the payable date, and do not
include sales charges; results would be lower if sales charge was
included.
***As a result of the implementation of the Merrill Lynch Select
Pricing SM System, Class A Shares of the Fund outstanding prior to
October 21, 1994 were redesignated to Class D Shares.
</TABLE>
<PAGE>
<TABLE>
Performance
Summary--
Class B Shares
<CAPTION>
Net Asset Value Capital Gains
Period Covered Beginning Ending Distributed Dividends Paid* % Change**
<C> <C> <C> <C> <C> <C>
8/27/93--12/31/93 $10.00 $10.84 -- $0.281 +11.30%
1994 10.84 8.48 -- 0.754 -15.08
1995 8.48 9.65 -- 0.875 +26.10
------
Total $1.910
Cumulative total return as of 12/31/95: +19.17%**
<FN>
*Figures may include short-term capital gains distributions.
**Figures assume reinvestment of all dividends and capital gains
distributions at net asset value on the payable date, and do not
reflect deduction of any sales charge; results would be lower if
sales charge was deducted.
</TABLE>
<TABLE>
Performance
Summary--
Class C Shares
<CAPTION>
Net Asset Value Capital Gains
Period Covered Beginning Ending Distributed Dividends Paid* % Change**
<C> <C> <C> <C> <C> <C>
10/21/94--12/31/94 $9.08 $8.47 -- $0.152 - 5.06%
1995 8.47 9.65 -- 0.870 +26.18
------
Total $1.022
Cumulative total return as of 12/31/95: +19.80%**
<FN>
*Figures may include short-term capital gains distributions.
**Figures assume reinvestment of all dividends and capital gains
distributions at net asset value on the payable date, and do not
reflect deduction of any sales charge; results would be lower if
sales charge was deducted.
</TABLE>
<PAGE>
<TABLE>
Performance
Summary--
Class D Shares***
<CAPTION>
Net Asset Value Capital Gains
Period Covered Beginning Ending Distributed Dividends Paid* % Change**
<C> <C> <C> <C> <C> <C>
8/27/93--12/31/93 $10.00 $10.84 -- $0.300 +11.49%
1994 10.84 8.48 -- 0.802 -14.65
1995 8.48 9.65 0.919 +26.75
------
Total $2.021
Cumulative total return as of 12/31/95: +20.62%**
<FN>
*Figures may include short-term capital gains distributions.
**Figures assume reinvestment of all dividends and capital gains
distributions at net asset value on the payable date, and do not
include sales charges; results would be lower if sales charge was
included.
***As a result of the implementation of the Merrill Lynch Select
Pricing SM System, Class A Shares of the Fund outstanding prior to
October 21, 1994 were redesignated to Class D Shares.
</TABLE>
PERFORMANCE DATA (concluded)
<PAGE>
<TABLE>
Recent
Performance
Results
<CAPTION>
12 Month 3 Month
12/31/95 9/30/95 12/31/94 % Change % Change
<S> <C> <C> <C> <C> <C>
ML Americas Income Fund Class A Shares* $9.70 $9.07 $8.51 +13.98% +6.95%
ML Americas Income Fund Class B Shares* 9.65 9.02 8.48 +13.80 +6.98
ML Americas Income Fund Class C Shares* 9.65 9.02 8.47 +13.93 +6.98
ML Americas Income Fund Class D Shares* 9.65 9.02 8.48 +13.80 +6.98
ML Americas Income Fund Class A Shares--Total Return* +27.27(1) +9.82(2)
ML Americas Income Fund Class B Shares--Total Return* +26.10(3) +9.63(4)
ML Americas Income Fund Class C Shares--Total Return* +26.18(5) +9.61(6)
ML Americas Income Fund Class D Shares--Total Return* +26.75(7) +9.78(8)
ML Americas Income Fund Class A Shares--Standardized 30-day Yield 11.83%
ML Americas Income Fund Class B Shares--Standardized 30-day Yield 11.60%
ML Americas Income Fund Class C Shares--Standardized 30-day Yield 11.63%
ML Americas Income Fund Class D Shares--Standardized 30-day Yield 11.62%
<FN>
*Investment results shown do not reflect sales charges; results
shown would be lower if a sales charge was included.
(1)Percent change includes reinvestment of $0.944 per share ordinary
income dividends.
(2)Percent change includes reinvestment of $0.276 per share ordinary
income dividends.
(3)Percent change includes reinvestment of $0.875 per share ordinary
income dividends.
(4)Percent change includes reinvestment of $0.256 per share ordinary
income dividends.
(5)Percent change includes reinvestment of $0.870 per share ordinary
income dividends.
(6)Percent change includes reinvestment of $0.255 per share ordinary
income dividends.
(7)Percent change includes reinvestment of $0.919 per share ordinary
income dividends.
(8)Percent change includes reinvestment of $0.269 per share ordinary
income dividends.
</TABLE>
<TABLE>
SCHEDULE OF INVESTMENTS (in US dollars)
<CAPTION>
Interest Maturity Value Percent of
COUNTRY Industry Face Amount Bonds Rate Date (Note 1a) Net Assets
<S> <S> <C> <S> <C> <C> <C> <C>
Argentina Banking $ 6,000,000 Banco de Galicia y Buenos Aires
S.A.--Yankee 9.00 % 11/01/2003 $ 5,235,000 4.4%
7,000,000 Banco Rio de la Plata S.A.--Yankee 8.75 12/15/2003 6,125,000 5.1
------------ ------
11,360,000 9.5
<PAGE>
Conglomerate 2,000,000 Sociedad Commercial del Plata 8.75 12/14/1998 1,875,000 1.5
Energy
Utilities 1,000,000 Telecom Argentina Stet--France
Telecom S.A. 12.00 11/15/2002 1,060,000 0.9
Total Bonds in Argentina
(Cost--$15,902,304) 14,295,000 11.9
Brazil Banking 4,000,000 Banco do Estado de Parana 10.00 2/27/1996 3,975,000 3.3
850,000 Usinas Siderurgicas de Minas
Gerais--Usiminas S.A. 10.00 1/15/1996 848,938 0.7
------------ ------
4,823,938 4.0
Energy 1,000,000 Celulose Nipo--Brasileira S.A.
(CENIBRA) 9.375 12/21/2003 970,000 0.8
Oil Service 1,000,000 ++Compania Brazileira de Petroleo
Ipiranga (a) 8.625 2/25/2002 975,000 0.8
Paper 1,000,000 Klabine Fabricadora Papel 10.00 12/20/2001 977,500 0.8
Total Bonds in Brazil
(Cost--$7,885,175) 7,746,438 6.4
Colombia Banking 2,000,000 Banco de Colombia 7.50 10/21/1998 1,930,000 1.6
Total Bonds in Colombia
(Cost--$1,952,500) 1,930,000 1.6
Mexico Banking 1,500,000 Banamex Eurobond, S.A. 9.125 4/06/2000 1,436,250 1.2
1,000,000 Banco de Atlantico, S.A. 7.875 11/05/1998 850,000 0.7
8,000,000 Banco Nacional Comercio Exterior 7.25 2/02/2004 6,270,000 5.2
------------ ------
8,556,250 7.1
Chemicals 1,000,000 Grupo Desc--IRSA 8.375 7/15/1998 895,000 0.8
Steel 2,000,000 ++Grupo Simec, S.A. de C.V.,
guaranteed by Grupo Sidek, S.A. 8.875 12/15/1998 1,111,250 0.9
Tourism 2,500,000 Grupo Situr, S.A. de C.V.,
guaranteed by Grupo Sidek, S.A. 8.75 9/14/1998 1,350,000 1.1
Total Bonds in Mexico
(Cost--$13,873,444) 11,912,500 9.9
<PAGE>
Venezuela Oil 1,000,000 Bariven S.A. 10.625 3/17/2002 957,500 0.8
Total Bonds in Venezuela
(Cost--$1,075,000) 957,500 0.8
Total Investments in Bonds
(Cost--$40,688,423) 36,841,438 30.6
Brady Bonds***
Argentina Sovereign 28,000,000 Republic of Argentina,
Government Floating Rate Bond* 6.812 3/31/2005 19,950,000 16.6
Obligations
Total Brady Bonds in Argentina
(Cost--$17,281,750) 19,950,000 16.6
Brazil Sovereign 26,530,200 Republic of Brazil, C Bonds (a) 8.00 4/15/2014 15,254,865 12.7
Government 2,500,000 Republic of Brazil, EI Bonds 6.812 4/15/2006 1,715,625 1.4
Obligations 3,000,000 Republic of Brazil, Exit Bonds 6.00 9/15/2013 1,680,000 1.4
500,000 Republic of Brazil, Floating
Rate Bond, Debenture 6.875 4/15/2012 286,250 0.2
11,000,000 Republic of Brazil, Floating
Rate Bond, New Money 6.875 4/15/2009 6,792,500 5.7
Total Brady Bonds in Brazil
(Cost--$23,763,100) 25,729,240 21.4
Ecuador Sovereign 10,000,000 Republic of Ecuador--Discount 6.812 2/28/2025 5,037,500 4.2
Government
Obligations
Total Brady Bonds in Ecuador
(Cost--$4,945,595) 5,037,500 4.2
Mexico Sovereign 25,000,000 United Mexican States, Par 'A'* 6.25 12/31/2019 16,281,250 13.5
Government 25,001,000 United Mexican States, Value
Obligations Recovery Rights (b) 0.00 25 0.0
Total Brady Bonds in Mexico
(Cost--$15,380,844) 16,281,275 13.5
</TABLE>
<PAGE>
<TABLE>
SCHEDULE OF INVESTMENTS (concluded) (in US dollars)
<CAPTION>
Interest Maturity Value Percent of
COUNTRY Industry Face Amount Bonds Rate Date (Note 1a) Net Assets
<S> <S> <C> <S> <C> <C> <C> <C>
Venezuela Sovereign $ 7,250,000 Republic of Venezuela, DCB 6.562% 12/18/2007 $ 3,960,312 3.3%
Government 2,000,000 Republic of Venezuela, Floating
Obligations Rate Bond 6.812 3/31/2007 1,110,000 0.9
2,000,000 Republic of Venezuela, Par Bond,
Series `B' 6.75 3/31/2020 1,142,500 1.0
10,000 Republic of Venezuela,
Recovery Rights (c) 0.00 0 0.0
Total Brady Bonds in Venezuela
(Cost--$5,881,313) 6,212,812 5.2
Total Investments in Brady Bonds
(Cost--$67,252,602) 73,210,827 60.9
Short-Term Investments
Certificates 2,000,000 Banca Promex 13.50 2/13/1996 1,968,000 1.6
of Deposit
Total Certificates of Deposit
(Cost--$1,969,539) 1,968,000 1.6
Foreign 7,495,520 Mexican Cetes 36.15 3/07/1996 893,019 0.8
Government 8,512,500 Mexican Cetes 36.20 9/05/1996 837,076 0.7
Obligations**
Total Foreign Government Obligations
(Cost--$2,218,623) 1,730,095 1.5
Total Short-Term Investments
(Cost--$4,188,162) 3,698,095 3.1
Total Investments (Cost--$112,129,187) 113,750,360 94.6
Other Assets Less Liabilities 6,444,534 5.4
------------ ------
Net Assets $120,194,894 100.0%
============ ======
<PAGE>
<FN>
(a)Represents a zero coupon or step bond; the interest rate shown is
the effective yield at the time of purchase by the Fund.
(b)The rights may be exercised until 12/31/2019.
(c)The rights may be exercised until 3/31/2020.
*Security represents collateral in connection with reverse
repurchase agreements (Note 5).
**Certain Foreign Government Obligations are traded on a discount
basis; the interest rates shown are the discount rates paid at the
time of purchase by the Fund.
***Brady Bonds are securities which have been issued to refinance
commercial bank loans and other debt. They are created when
creditors tender eligible debt in exchange for new bonds.
++Restricted security as to resale. The value of the Fund's
investment in restricted securities was approximately $2,086,000,
representing 1.7% of net assets.
<CAPTION>
Acquisition Value
Issue Date Cost (Note 1a)
<S> <C> <C> <C>
Compania Brazileira de
Petroleo Ipiranga 2/15/1994 $ 999,175 $ 975,000
Grupo Simec, S.A. de C.V.,
guaranteed by Grupo Sidek, S.A. 12/02/1993 1,990,880 1,111,250
Total $2,990,055 $2,086,250
========== ==========
See Notes to Financial Statements.
</TABLE>
<TABLE>
STATEMENT OF ASSETS ANDLIABILITIES
<CAPTION>
As of December 31, 1995
<S> <S> <C> <C>
Assets: Investments, at value (identified cost--$112,129,187) (Note 1a) $113,750,360
Receivables:
Securities sold $ 13,598,956
Interest 2,702,944
Reverse repurchase agreements (Note 5) 1,535,409
Capital shares sold 325,713 18,163,022
------------
Deferred organization expenses (Note 1f) 55,277
Prepaid registration fees and other assets (Note 1f) 65,018
------------
Total assets 132,033,677
------------
<PAGE>
Liabilities: Payables:
Reverse repurchase agreements (Note 5) 10,265,476
Dividends to shareholders (Note 1g) 938,240
Capital shares redeemed 336,996
Distributor (Note 2) 68,899
Investment adviser (Note 2) 64,173
Interest expense (Note 5) 7,628 11,681,412
------------
Accrued expenses and other liabilities 157,371
------------
Total liabilities 11,838,783
------------
Net Assets: Net assets $120,194,894
============
Net Assets Class A Common Stock, $0.10 par value, 100,000,000 shares authorized $ 12,012
Consist of: Class B Common Stock, $0.10 par value, 100,000,000 shares authorized 1,072,114
Class C Common Stock, $0.10 par value, 100,000,000 shares authorized 14,470
Class D Common Stock, $0.10 par value, 100,000,000 shares authorized 146,889
Paid-in capital in excess of par 129,096,359
Undistributed investment income--net 950,933
Accumulated realized capital losses on investments and foreign
currency transactions--net (Note 6) (12,709,426)
Unrealized appreciation on investments and foreign currency
transactions--net 1,611,543
------------
Net assets $120,194,894
============
Net Asset Class A--Based on net assets of $1,164,711 and 120,124
Value: shares outstanding $ 9.70
============
Class B--Based on net assets of $103,464,533 and 10,721,140
shares outstanding $ 9.65
============
Class C--Based on net assets of $1,396,123 and 144,704
shares outstanding $ 9.65
============
Class D--Based on net assets of $14,169,527 and 1,468,891
shares outstanding $ 9.65
============
See Notes to Financial Statements.
</TABLE>
<PAGE>
<TABLE>
STATEMENT OF OPERATIONS
<CAPTION>
For the Year Ended December 31, 1995
<S> <S> <C> <C>
Investment Income Interest and amortization of premium and discount earned $ 13,873,521
(Note 1e):
Expenses: Account maintenance and distribution fees--Class B (Note 2) $ 683,769
Investment advisory fees (Note 2) 680,512
Interest expense (Note 5) 169,737
Printing and shareholder reports 139,585
Accounting services (Note 2) 122,063
Transfer agent fees--Class B (Note 2) 114,804
Professional fees 92,219
Registration fees (Note 1f) 58,427
Custodian fees 56,327
Account maintenance fees--Class D (Note 2) 44,979
Trustees' fees and expenses 39,032
Amortization of organization expenses (Note 1f) 20,965
Transfer agent fees--Class D (Note 2) 19,874
Account maintenance and distribution fees--Class C (Note 2) 4,589
Transfer agent fees--Class A (Note 2) 1,111
Transfer agent fees--Class C (Note 2) 526
Pricing fees 110
Other 11,288
------------
Total expenses 2,259,917
------------
Investment income--net 11,613,604
------------
Realized & Realized loss from:
Unrealized Gain Investments--net (4,316,378)
(Loss) on Foreign currency transactions--net (391,070) (4,707,448)
Investments & ------------
Foreign Currency Change in unrealized appreciation/depreciation on:
Transactions--Net Investments--net 18,071,468
(Notes 1b, 1c, Foreign currency transactions--net (9,623) 18,061,845
1e & 3): ------------ ------------
Net realized and unrealized gain on investments
and foreign currency transactions 13,354,397
------------
Net Increase in Net Assets Resulting from Operations $ 24,968,001
============
See Notes to Financial Statements.
</TABLE>
<PAGE>
<TABLE>
STATEMENTS OF CHANGES IN NET ASSETS
<CAPTION>
For the Year Ended
December 31,
Increase (Decrease) in Net Assets: 1995 1994
<S> <S> <C> <C>
Operations: Investment income--net $ 11,613,604 $ 10,802,121
Realized loss on investments and foreign currency
transactions--net (4,707,448) (8,693,336)
Change in unrealized appreciation/depreciation on
investments and foreign currency transactions--net 18,061,845 (22,739,647)
------------ ------------
Net increase (decrease) in net assets resulting from
operations 24,968,001 (20,630,862)
------------ ------------
Dividends & Investment income--net:
Distributions to Class A (119,581) (11,403)
Shareholders Class B (9,482,996) (7,795,228)
(Note 1g): Class C (58,666) (1,064)
Class D (1,952,361) (1,352,808)
Realized gain on investments--net:
Class A -- (2,044)
Class B -- (1,396,952)
Class C -- (191)
Class D -- (242,431)
------------ ------------
Net decrease in net assets resulting from dividends and
distributions to shareholders (11,613,604) (10,802,121)
------------ ------------
Capital Share Net increase (decrease) in net assets derived from
Transactions capital share transactions (10,358,969) 34,708,277
(Note 4): ------------ ------------
Net Assets: Total increase in net assets 2,995,428 3,275,294
Beginning of year 117,199,466 113,924,172
------------ ------------
End of year* $120,194,894 $117,199,466
============ ============
<FN>
*Undistributed net investment income-- net (Note 1h) $ 950,933 $ 1,641,618
============ ============
See Notes to Financial Statements.
</TABLE>
<PAGE>
<TABLE>
STATEMENT OF CASH FLOWS
<CAPTION>
For the Year Ended December 31, 1995
<S> <S> <C>
Cash Provided by Net increase in net assets resulting from operations $ 24,968,001
Operating Adjustments to reconcile net increase in net assets resulting
Activities: from operations to net cash provided by operating activities:
Increase in receivables (344,191)
Increase in other assets (9,207)
Decrease in other liabilities (228,134)
Realized and unrealized gain on investments and foreign
currency transactions--net (13,354,397)
Amortization of discount (1,720,330)
---------------
Net cash provided by operating activities 9,311,742
---------------
Cash Provided by Proceeds from sales of long-term securities 124,170,698
Investing Purchases of long-term securities (130,397,131)
Activities: Purchases of short-term investments (1,057,787,514)
Proceeds from sales and maturities of short-term investments 1,086,048,026
---------------
Net cash provided by investing activities 22,034,079
---------------
Cash Used for Cash receipts from issuance of common stock 51,478,023
Financing Repayments of borrowings--net (8,327,933)
Activities: Cash payments on shares of beneficial interest redeemed (67,895,167)
Dividends paid to shareholders (6,601,277)
---------------
Net cash used for financing activities (31,346,354)
---------------
Cash: Net decrease in cash (533)
Cash at beginning of year 533
---------------
Cash at end of year $ 0
===============
Cash Flow Cash paid for interest $ 314,569
Information: ===============
Non-Cash Capital shares issued on reinvestment of dividends paid to shareholders $ 4,957,965
Financing ===============
Activities:
See Notes to Financial Statements.
</TABLE>
<PAGE>
<TABLE>
FINANCIAL HIGHLIGHTS
<CAPTION>
Class A Class B
For the For the
The following per share data and ratios For the Period For the Period
have been derived from information provided Year Oct. 21, Year Ended Aug. 27,
in the financial statements. Ended 1994++ to December 31, 1993++ to
Dec. 31, Dec. 31, ------------- Dec. 31,
Increase (Decrease) in Net Asset Value: 1995 1994 1995 1994 1993
<S> <S> <C> <C> <C> <C> <C>
Per Share Net asset value, beginning of period $ 8.51 $ 9.08 $ 8.48 $ 10.84 $ 10.00
Operating -------- -------- -------- -------- --------
Performance: Investment income--net .94 .17 .88 .75 .24
Realized and unrealized gain (loss) on
investments and foreign currency
transactions--net 1.19 (.57) 1.17 (2.36) .88
-------- -------- -------- -------- --------
Total from investment operations 2.13 (.40) 2.05 (1.61) 1.12
-------- -------- -------- -------- --------
Less dividends and distributions:
Investment income--net (.94) (.14) (.88) (.64) (.24)
Realized gain on investments--net -- (.03) -- (.11) (.04)
-------- -------- -------- -------- --------
Total dividends and distributions (.94) (.17) (.88) (.75) (.28)
-------- -------- -------- -------- --------
Net asset value, end of period $ 9.70 $ 8.51 $ 9.65 $ 8.48 $ 10.84
======== ======== ======== ======== ========
Total Investment Based on net asset value per share 27.27% (4.45%)+++26.10% (15.08%) 11.30%+++
Return:** ======== ======== ======== ======== ========
Ratios to Average Expenses, excluding account maintenance and
Net Assets: distribution fees, interest expense and net
of reimbursement 1.20% 1.22%* 1.22% 1.04% .27%*
======== ======== ======== ======== ========
Expenses, excluding interest expense and
net of reimbursement 1.20% 1.22%* 1.97% 1.79% 1.03%*
======== ======== ======== ======== ========
Expenses, excluding interest expense 1.20% 1.22%* 1.97% 2.00% 2.45%*
======== ======== ======== ======== ========
Expenses 1.36% 1.91%* 2.13% 2.70% 2.53%*
======== ======== ======== ======== ========
Investment income--net 11.25% 8.63%* 10.40% 8.14% 6.76%*
======== ======== ======== ======== ========
<PAGE>
Supplemental Net assets, end of period (in thousands) $ 1,165 $ 253 $103,465 $101,933 $ 98,848
Data: ======== ======== ======== ======== ========
Portfolio turnover 127.17% 353.33% 127.17% 353.33% 75.18%
======== ======== ======== ======== ========
Leverage: Amount of reverse repurchase agreements
outstanding, end of period (in thousands) $ 10,265 $ 17,058 $ 10,265 $ 17,058 $ 21,546
======== ======== ======== ======== ========
Average amount of reverse repurchase
agreements outstanding during the period
(in thousands) $ 2,640 $ 17,315 $ 2,640 $ 17,315 $ 18,977
======== ======== ======== ======== ========
Average amount of reverse repurchase
agreements per share during the period $ .20 $ 1.19 $ .20 $ 1.19 $ 1.81
======== ======== ======== ======== ========
<FN>
*Annualized.
**Total investment returns exclude the effect of sales loads.
++Commencement of Operations.
+++Aggregate total investment return.
See Notes to Financial Statements.
</TABLE>
<TABLE>
FINANCIAL HIGHLIGHTS (concluded)
<CAPTION>
Class C Class D
For the For the
The following per share data and ratios For the Period For the Period
have been derived from information provided Year Oct. 21, Year Ended Aug. 27,
in the financial statements. Ended 1994++ to December 31, 1993++ to
Dec. 31, Dec. 31, ------------- Dec. 31,
Increase (Decrease) in Net Asset Value: 1995 1994 1995 1994 1993
<S> <S> <C> <C> <C> <C> <C>
Per Share Net asset value, beginning of period $ 8.47 $ 9.08 $ 8.48 $ 10.84 $ 10.00
Operating -------- -------- -------- -------- --------
Performance: Investment income--net .87 .15 .92 .80 .26
Realized and unrealized gain (loss) on
investments and foreign currency
transactions--net 1.18 (.61) 1.17 (2.36) .88
<PAGE> -------- -------- -------- -------- --------
Total from investment operations 2.05 (.46) 2.09 (1.56) 1.14
-------- -------- -------- -------- --------
Less dividends and distributions:
Investment income--net (.87) (.13) (.92) (.68) (.26)
Realized gain on investments--net -- (.02) -- (.12) (.04)
-------- -------- -------- -------- --------
Total dividends and distributions (.87) (.15) (.92) (.80) (.30)
-------- -------- -------- -------- --------
Net asset value, end of period $ 9.65 $ 8.47 $ 9.65 $ 8.48 $ 10.84
======== ======== ======== ======== ========
Total Investment Based on net asset value per share 26.18% (5.06%)+++26.75% (14.65%) 11.49%+++
Return:** ======== ======== ======== ======== ========
Ratios to Average Expenses, excluding account maintenance and
Net Assets: distribution fees, interest expense and net
of reimbursement 1.25% 1.44%* 1.19% 1.03% .25%*
======== ======== ======== ======== ========
Expenses, excluding interest expense and net
of reimbursement 2.05% 2.24%* 1.44% 1.28% .50%*
======== ======== ======== ======== ========
Expenses, excluding interest expense 2.05% 2.24%* 1.44% 1.48% 1.93%*
======== ======== ======== ======== ========
Expenses 2.19% 3.05%* 1.60% 2.17% 2.03%*
======== ======== ======== ======== ========
Investment income--net 10.23% 8.87%* 10.85% 8.65% 7.14%*
======== ======== ======== ======== ========
Supplemental Net assets, end of period (in thousands) $ 1,396 $ 75 $ 14,169 $ 14,938 $ 15,076
Data: ======== ======== ======== ======== ========
Portfolio turnover 127.17% 353.33% 127.17% 353.33% 75.18%
======== ======== ======== ======== ========
Leverage: Amount of reverse repurchase agreements
outstanding, end of period (in thousands) $ 10,265 $ 17,058 $ 10,265 $ 17,058 $ 21,546
======== ======== ======== ======== ========
Average amount of reverse repurchase
agreements outstanding during the period
(in thousands) $ 2,640 $ 17,315 $ 2,640 $ 17,315 $ 18,977
======== ======== ======== ======== ========
Average amount of reverse repurchase
agreements per share during the period $ .20 $ 1.19 $ .20 $ 1.19 $ 1.81
======== ======== ======== ======== ========
<FN>
*Annualized.
**Total investment returns exclude the effect of sales loads.
++Commencement of Operations.
+++Aggregate total investment return.
See Notes to Financial Statements.
</TABLE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS
1. Significant Accounting Policies:
Merrill Lynch Americas Income Fund, Inc. (the "Fund") is registered
under the Investment Company Act of 1940 as a non-diversified, open-
end management investment company. The Fund offers four classes of
shares under the Merrill Lynch Select Pricing SM System. Shares of
Class A and Class D are sold with a front-end sales charge. Shares
of Class B and Class C may be subject to a contingent deferred sales
charge. All classes of shares have identical voting, dividend,
liquidation and other rights and the same terms and conditions,
except that Class B, Class C and Class D Shares bear certain
expenses related to the account maintenance of such shares, and
Class B and Class C Shares also bear certain expenses related to the
distribution of such shares. Each class has exclusive voting rights
with respect to matters relating to its account maintenance and
distribution expenditures. The following is a summary of significant
accounting policies followed by the Fund.
(a) Valuation of securities--Portfolio securities which are traded
on stock exchanges are valued at the last sale price on the exchange
on which such securities are traded, as of the close of business on
the day the securities are being valued or, lacking any sales, at
the last available bid price. Securities traded in the over-the-
counter market are valued at the last available bid price prior to
the time of valuation. In cases where securities are traded on more
than one exchange, the securities are valued on the exchange
designated by or under the authority of the Board of Directors as
the primary market. Securities which are traded both in the over-the-
counter market and on a stock exchange are valued according to the
broadest and most representative market. Options written are valued
at the last sale price in the case of exchange-traded options or, in
the case of options traded in the over-the-counter market, the last
asked price. Options purchased are valued at the last sale price in
the case of exchange-traded options or, in the case of options
traded in the over-the-counter market, the last bid price. Short-
term securities are valued at amortized cost, which approximates
market value. Other investments, including futures contracts and
related options, are stated at market value. Securities and assets
for which market value quotations are not available are valued at
their fair value as determined in good faith by or under the
direction of the Fund's Board of Directors.
<PAGE>
(b) Derivative financial instruments--The Fund may engage in various
portfolio strategies to seek to increase its return by hedging its
portfolio against adverse movements in the debt and currency
markets. Losses may arise due to changes in the value of the
contract or if the counterparty does not perform under the contract.
* Forward foreign exchange contracts--The Fund is authorized to
enter into forward foreign exchange contracts as a hedge against
either specific transactions or portfolio positions. Such contracts
are not entered on the Fund's records. However, the effect on
operations is recorded from the date the Fund enters into such
contracts. Premium or discount is amortized over the life of the
contracts.
* Options--The Fund is authorized to write and purchase call and put
options. When the Fund writes an option, an amount equal to the
premium received by the Fund is reflected as an asset and an
equivalent liability. The amount of the liability is subsequently
marked to market to reflect the current market value of the option
written.
When a security is purchased or sold through an exercise of an
option, the related premium paid (or received) is added to (or
deducted from) the basis of the security acquired or deducted from
(or added to) the proceeds of the security sold. When an option
expires (or the Fund enters into a closing transaction), the Fund
realizes a gain or loss on the option to the extent of the premiums
received or paid (or gain or loss to the extent the cost of the
closing transaction exceeds the premium paid or received).
Written and purchased options are non-income producing
investments.
* Financial futures contracts--The Fund may purchase or sell
financial futures contracts and options on such futures contracts as
a hedge against adverse changes in interest rates. A futures
contract is an agreement between two parties to buy and sell a
security, respectively, for a set price on a future date. Upon
entering into a contract, the Fund deposits and maintains as
collateral such initial margin as required by the exchange on which
the transaction is effected. Pursuant to the contract, the Fund
agrees to receive from or pay to the broker an amount of cash equal
to the daily fluctuation in value of the contract. Such receipts or
payments are known as variation margin and are recorded by the Fund
as unrealized gains or losses. When the contract is closed, the Fund
records a realized gain or loss equal to the difference between the
value of the contract at the time it was opened and the value at the
time it was closed.
<PAGE>
NOTES TO FINANCIAL STATEMENTS (continued)
(c) Foreign currency transactions--Transactions denominated in
foreign currencies are recorded at the exchange rate prevailing when
recognized. Assets and liabilities denominated in foreign currencies
are valued at the exchange rate at the end of the period. Foreign
currency transactions are the result of settling (realized) or
valuing (unrealized) assets or liabilities expressed in foreign
currencies into US dollars. Realized and unrealized gains or losses
from investments include the effects of foreign exchange rates on
investments.
(d) Income taxes--It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute all of its taxable income to
its shareholders. Therefore, no Federal income tax provision is
required. Under the applicable foreign tax law, a withholding tax
may be imposed on interest and capital gains at various rates.
(e) Security transactions and investment income--Security
transactions are recorded on the dates the transactions are entered
into (the trade dates). Interest income (including amortization of
discount) is recognized on the accrual basis. Realized gains and
losses on security transactions are determined on the identified
cost basis.
(f) Deferred organization expenses and prepaid registration fees--
Deferred organization expenses are charged to expense over a five-
year period. Prepaid registration fees are charged to expense as the
related shares are issued.
(g) Dividends and distributions--Dividends from net investment
income are declared daily and paid monthly. Distribution of capital
gains are recorded on the ex-dividend date.
(h) Reclassification--Generally accepted accounting principles
require that certain components of net assets be reclassified to
reflect permanent differences between financial reporting and tax
purposes. Accordingly, current year's permanent book/tax differences
of $1,146 and $690,685 have been reclassified from paid-in capital
in excess of par and undistributed net investment income,
respectively, to accumulated net realized capital losses. These
reclassifications have no effect on net assets or net asset values
per share.
<PAGE>
2. Investment Advisory Agreement and Transactions
with Affiliates:
The Fund has entered into an Investment Advisory Agreement with
Merrill Lynch Asset Management, L.P. ("MLAM"). The general partner
of MLAM is Princeton Services, Inc. ("PSI"), an indirect wholly-
owned subsidiary of Merrill Lynch & Co., Inc., ("ML & Co."), which
is the limited partner. The Fund has also entered into a
Distribution Agreement and Distribution Plans with Merrill Lynch
Funds Distributor, Inc. ("MLFD" or "Distributor"), a wholly-owned
subsidiary of Merrill Lynch Group, Inc.
MLAM is responsible for the management of the Fund's portfolio and
provides the necessary personnel, facilities, equipment and certain
other services necessary to the operation of the Fund. For such
services, the Fund pays a monthly fee of 0.60%, on an annual basis,
of the average daily value of the Fund's net assets plus the
principal amount of borrowings incurred by the Fund for leverage
purposes. The most restrictive annual expense limitation requires
that MLAM reimburse the Fund to the extent the Fund's expenses
(excluding interest, taxes, distribution fees, brokerage fees and
commissions, and extraordinary items) exceed 2.5% of the Fund's
first $30 million of average daily net assets, 2.0% of the next $70
million of average daily net assets, and 1.5% of the average daily
net assets in excess thereof. MLAM's obligation to reimburse the
Fund is limited to the amount of the investment advisory fee. No fee
payment will be made to MLAM during any fiscal year which will cause
such expenses to exceed the most restrictive expense limitation at
the time of such payment.
Pursuant to the distribution plans ("the Distribution Plans")
adopted by the Fund in accordance with Rule 12b-1 under the
Investment Company Act of 1940, the Fund pays the Distributor
ongoing account maintenance and distribution fees. The fees are
accrued daily and paid monthly at annual rates based upon the
average daily net assets of the shares as follows:
Account Distribution
Maintenance Fee Fee
Class B 0.25% 0.50%
Class C 0.25% 0.55%
Class D 0.25% --
Pursuant to a sub-agreement with the Distributor, Merrill Lynch,
Pierce, Fenner & Smith Inc. ("MLPF&S"), a subsidiary of ML & Co.,
also provides account maintenance and distribution services to the
Fund. The ongoing account maintenance fee compensates the
Distributor and MLPF&S for providing account maintenance services to
Class B, Class C and Class D shareholders. The ongoing distribution
fee compensates the Distributor and MLPF&S for providing shareholder
and distribution-related services to Class B and Class C
shareholders.
<PAGE>
For the year ended December 31, 1995, MLFD earned underwriting
discounts and MLPF&S earned dealer concessions on sales of the
Fund's Class A and Class D Shares as follows:
MLFD MLPF&S
Class A $ 20 $ 375
Class D $1,252 $14,379
For the year ended December 31, 1995, MLPF&S received contingent
deferred sales charges of $265,027 and $552 relating to transactions
in Class B and Class C Shares, respectively.
During the year ended December 31, 1995, the Fund paid Merrill Lynch
Security Pricing Service, an affiliate of MLPF&S, $48 for security
price quotations to compute the net asset value of the Fund.
Merrill Lynch Financial Data Services, Inc. ("MLFDS"), a wholly-
owned subsidiary of ML & Co., is the Fund's transfer agent.
Accounting services are provided to the Fund by MLAM at cost.
Certain officers and/or directors of the Fund are officers and/or
directors of MLAM, PSI, MLPF&S, MLFD, MLFDS, and/or ML & Co.
3. Investments:
Purchases and sales of investments, excluding short-term securities,
for the year ended December 31, 1995 were $124,169,770 and
$125,040,179, respectively.
Realized and unrealized gains (losses) as of December 31, 1995 were
as follows:
Realized Unrealized
Gains Gains
(Losses) (Losses)
Long-term investments $ (4,606,350) $ 2,111,240
Short-term investments 432 (490,067)
Foreign currency transactions (391,070) (9,630)
Options written 329,769 --
Options purchased (40,229) --
------------ ------------
Total $ (4,707,448) $ 1,611,543
============ ============
<PAGE>
Transactions in call options written for the year ended December 31,
1995 were as follows:
Premiums
Call Options Written Par Value Received
Outstanding call options
written, beginning of year $ 21,500,000 $ 271,000
Options written 3,656,775 58,769
Options expired (25,156,775) (329,769)
------------ ------------
Outstanding call options
written, end of year $ -- $ --
============ ============
Transactions in put options written for the year ended December 31,
1995 were as follows:
Premiums
Put Options Written Par Value Received
Outstanding put options written,
beginning of year $ 6,500,000 $ 131,000
Options written 3,000,000 72,000
Options exercised (9,500,000) (203,000)
------------ ------------
Outstanding put options written,
end of year $ -- $ --
============ ============
As of December 31, 1995, net unrealized depreciation for Federal
income tax purposes aggregated $1,860,565 of which $5,141,337
related to appreciated securities and $7,001,902 related to
depreciated securities. At December 31, 1995, the aggregate cost of
investments for Federal income tax purposes was $115,610,925.
4. Capital Share Transactions:
Net increase (decrease) in net assets derived from capital share
transactions was $(10,358,969) and $34,708,277 for the years ended
December 31, 1995 and December 31, 1994, respectively.
Transactions in shares of capital were as follows:
<PAGE>
Class A Shares for the Year Dollar
Ended December 31, 1995 Shares Amount
Shares sold 424,389 $ 3,709,129
Shares issued to shareholders
in reinvestment of dividends 31,496 58,341
------------ ------------
Total issued 455,885 3,767,470
Shares redeemed (365,478) (3,126,616)
------------ ------------
Net increase 90,407 $ 640,854
============ ============
NOTES TO FINANCIAL STATEMENTS (concluded)
Class A Shares for the Period
October 21, 1994++ to Dollar
December 31, 1994 Shares Amount
Shares sold 398,776 $ 3,605,150
Shares issued to shareholders
in reinvestment of dividends &
distributions 52 444
------------ ------------
Total issued 398,828 3,605,594
Shares redeemed (369,111) (3,244,117)
------------ ------------
Net increase 29,717 $ 361,477
============ ============
[FN]
++Commencement of Operations.
Class B Shares for the Year Dollar
Ended December 31, 1995 Shares Amount
Shares sold 2,917,112 $ 25,020,930
Shares issued to shareholders
in reinvestment of dividends 466,431 3,936,697
------------ ------------
Total issued 3,383,543 28,957,627
Shares redeemed (4,688,387) (38,740,392)
------------ ------------
Net decrease (1,304,844) $ (9,782,765)
============ ============
<PAGE>
Class B Shares for the Year Dollar
Ended December 31, 1994 Shares Amount
Shares sold 7,923,270 $ 75,478,521
Shares issued to shareholders
in reinvestment of dividends &
distributions 386,490 3,561,014
------------ ------------
Total issued 8,309,760 79,039,535
Shares redeemed (5,404,682) (48,873,193)
------------ ------------
Net increase 2,905,078 $ 30,166,342
============ ============
Class C Shares for the Year Dollar
Ended December 31, 1995 Shares Amount
Shares sold 201,258 $ 1,740,118
Shares issued to shareholders
in reinvestment of dividends 3,112 27,775
------------ ------------
Total issued 204,370 1,767,893
Shares redeemed (68,570) (583,898)
------------ ------------
Net increase 135,800 $ 1,183,995
============ ============
Class C Shares for the Period
October 21, 1994++ to Dollar
December 31, 1994 Shares Amount
Shares sold 21,072 $ 188,454
Shares issued to shareholders
in reinvestment of dividends &
distributions 13 115
------------ ------------
Total issued 21,085 188,569
Shares redeemed (12,181) (107,206)
------------ ------------
Net increase 8,904 $ 81,363
============ ============
[FN]
++Commencement of Operations.
<PAGE>
Class D Shares for the Year Dollar
Ended December 31, 1995 Shares Amount
Shares sold 2,439,964 $ 21,030,210
Shares issued to shareholders
in reinvestment of dividends 108,946 935,152
------------ ------------
Total issued 2,548,910 21,965,362
Shares redeemed (2,842,527) (24,366,415)
------------ ------------
Net decrease (293,617) $ (2,401,053)
============ ============
Class D Shares for the Year Dollar
Ended December 31, 1994 Shares Amount
Shares sold 1,554,975 $ 15,123,677
Shares issued to shareholders
in reinvestment of dividends &
distributions 77,493 648,127
------------ ------------
Total issued 1,632,468 15,771,804
Shares redeemed (1,261,103) (11,672,709)
------------ ------------
Net increase 371,365 $ 4,099,095
============ ============
As a result of the implementation of the Merrill Lynch Select
Pricing SM System, Class A Shares of the Fund outstanding prior to
October 21, 1994 have been redesignated Class D Shares. There were
1,959,335 shares redesignated amounting to $19,962,223.
5. Reverse Repurchase Agreements:
Under a reverse repurchase agreement, the Fund sells securities and
agrees to repurchase them at a mutually agreed upon date and price.
At the time the Fund enters into a reverse repurchase agreement, it
may establish a segregated account with the custodian containing
cash, cash equivalents or liquid high grade debt securities having a
value at least equal to the repurchase price.
As of December 31, 1995, the Fund had entered into reverse
repurchase agreements in the amount of $10,265,476. For the year
ended December 31, 1995, the maximum amount entered into was
$17,058,000, the average amount outstanding was $2,639,633, and the
daily weighted average interest rate was 6.45%.
6. Capital Loss Carryforward:
At December 31, 1995, the Fund had a net capital loss carryforward
of approximately $9,400,000, of which $3,796,000 expires in 2002 and
$5,604,000 expires in 2003. This amount is available to offset like
amounts of any future taxable gains.
<PAGE>
<AUDIT-REPORT>
INDEPENDENT AUDITORS' REPORT
The Board of Directors and Shareholders,
Merrill Lynch Americas Income Fund, Inc.:
We have audited the accompanying statement of assets and
liabilities, including the schedule of investments, of Merrill Lynch
Americas Income Fund, Inc. as of December 31, 1995, the related
statements of operations and cash flows for the year then ended,
changes in net assets for each of the years in the two-year period
then ended and the financial highlights for each of the years in the
two-year period then ended and the period August 27, 1993
(commencement of operations) to December 31, 1993. These financial
statements and the financial highlights are the responsibility of
the Fund's management. Our responsibility is to express an opinion
on these financial statements and the financial highlights based on
our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial
statements and the financial highlights are free of material
misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements.
Our procedures included confirmation of securities owned at December
31, 1995, by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, such financial statements and financial highlights
present fairly, in all material respects, the financial position of
Merrill Lynch Americas Income Fund, Inc. as of December 31, 1995,
the results of its operations, the changes in its net assets, its
cash flows, and the financial highlights for the respective stated
periods in conformity with generally accepted accounting principles.
Deloitte & Touche LLP
Princeton, New Jersey
February 12, 1996
