<PAGE>
RCM
STRATEGIC
GLOBAL
GOVERNMENT
FUND
QUARTERLY
REPORT
APRIL 30, 1997
<PAGE>
LETTER TO SHAREHOLDERS
- ------------------------
PHOTO
Dear Shareholders:
The internationally oriented portfolio mix of the RCM Strategic
Global Government Fund (NYSE symbol: RCS) served the Fund well
for the quarter ended April 30, 1997. For the quarter, RCS
earned net investment income of $7.7 million or $0.25 per share
compared to $7.4 million or $0.24 per share in the same quarter last year. In
comparison to last year, the additional income was contributed by portfolio
reallocations into higher yielding emerging market fixed-income investments as
well as the addition of Canadian debt securities. The benefits of global
diversification helped RCS produce quarterly returns of 1.1% and 2.1% on net
asset value and market price performance, respectively.
During the quarter, the Federal Reserve raised short-term interest rates by
one-quarter of one percent. Although not a significant event in itself, the
increase signaled the monetary authorities' resolve to prevent inflation in the
United States from accelerating. Last year at quarter-end, RCS had 35% of its
duration exposure (contribution to portfolio price volatility) in the United
States. As of the end of April 1997, only 4% of your Fund's price volatility was
directly linked to United States interest rates. The progressive decrease in
duration in the United States reflected the emergence of better opportunities
abroad in 1996 and early 1997. More recently, the potential for further
restrictive Federal Reserve actions suggests that non-U.S. investments remain
relatively more attractive.
We believe that RCS continues to be well positioned to achieve consistent
dividend income production. We very much appreciate your support, and we look
forward to achieving continued success.
Respectfully,
[SIGNATURE]
Gary W. Schreyer
CHAIRMAN
MAY 15, 1997
<PAGE>
FUND HIGHLIGHTS
- ---------------
QUARTERLY FINANCIAL INFORMATION (UNAUDITED)
<TABLE>
<CAPTION>
PERIOD ENDED* 4/30/97 1/31/97 10/31/96 7/31/96 4/30/96
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Total investment income $ 8,766 $ 7,848 $ 8,116 $ 8,584 $ 8,465
Total investment income per share 0.29 0.25 0.27 0.28 0.28
Net investment income 7,679 6,687 7,038 7,503 7,437
Net investment income per share 0.25 0.22 0.23 0.25 0.24
Net realized and unrealized gain (loss) (4,200) 8,577 11,186 (3,998) (9,602)
Net realized and unrealized gain (loss) per share (0.14) 0.28 0.37 (0.13) (0.31)
Net asset value at end of period 11.76 11.87 11.62 11.24 11.35
Market price at end of period 10.63 10.63 10.00 9.75 9.63
Total return on market price 2.09% 8.86% 4.86% 3.62% (3.99)%
Total return on net asset value 1.14% 4.66% 5.69% 1.30% (0.30)%
Dividend from net investment income $ 0.22 $ 0.26 $ 0.22 $ 0.22 $ 0.22
Effective dividend yield** 8.36% 8.36% 8.88% 9.11% 9.23%
</TABLE>
<TABLE>
<CAPTION>
KEY CHARACTERISTICS 4/30/97
- ---------------------------------------------------------------
<S> <C>
MONTHLY DIVIDEND PER SHARE $ 0.074
EFFECTIVE DIVIDEND YIELD** 8.36%
MARKET PRICE PER SHARE $ 10.63
NET ASSET VALUE PER SHARE $ 11.76
DURATION 4.7 YEARS
AVERAGE CREDIT QUALITY AA
</TABLE>
* IN THOUSANDS EXCEPT PER SHARE DATA.
** LAST MONTHLY DIVIDEND DIVIDED BY MARKET PRICE AND ANNUALIZED.
1
<PAGE>
FUND MANAGERS' DISCUSSION AND ANALYSIS
- ----------------------------------------
WHAT IS LIKELY TO HAPPEN TO THE MAJOR FACTORS AFFECTING GLOBAL BONDS?
RCM Capital Management, L.L.C. ("RCM"), the Fund's investment manager,
anticipates that global economic volatility will remain low and that financial
asset prices will be supported in such an environment. In addition, RCM believes
there is a solid, secular global trend towards lower inflation and lower
interest rate volatility. This trend is driven in part by a global convergence
of policies, including freer trade, fiscal prudence, inflation restraint,
privatization, pension reform and deregulation. Countries are now focused on
putting their economies on a competitive footing, driven by the desire to
improve both trade and access to capital markets. However, this trend is not as
apparent in the United States as a result of its current cycle that carries a
risk of higher inflation.
HOW IS RCS RESPONDING TO THE U.S. INFLATION RISK?
The U.S. economy is on a course that historically has resulted in inflation. In
theory and in practice, there is some point where near-capacity production and
full employment lead to inflationary pressures. Currently available data,
including overall higher wages and high consumer confidence, among others,
suggest that we are at or near that point. As a result, the Federal Reserve is
in the position of having to determine whether or not to execute "a preemptive
strike" against inflationary pressures, a difficult decision because
inflationary data used in making such a determination reflects the past and not
the future. In addition, because the Federal Reserve's credibility is dependent
in large part on interest rate stability, the Federal Reserve is likely to be
wary of "getting behind the curve" by permitting inflation to grow. Nonetheless,
RCM expects incremental, upward changes to short-term interest rates in the
United States. Given this expectation, RCM is underweighting the United States
in favor of Europe and Latin America. Accordingly, overall Fund duration at the
end of the first quarter was 4% United States, 47% Europe, 36% Latin America and
13% Canada. Although Canadian interest rates historically have moved in parallel
with U.S. rates, RCM believes there are dynamics in the Canadian economy that
will allow Canadian interest rates to move independently of U.S. rates.
2
<PAGE>
FUND MANAGERS' DISCUSSION AND ANALYSIS
- ----------------------------------------
WILL THE MOVE TO A SINGLE EUROPEAN CURRENCY HELP THE FUND'S EUROPEAN EXPOSURE
THIS YEAR?
Europe is moving toward a single currency to achieve a quantum leap in its
economic competitiveness. In combination with the political efforts being made,
the new currency should facilitate trade and a freer movement of labor. As a
result, it is forecasted that a single currency would result in substantial
savings in transaction costs between European nations. In 1997, there is likely
to be considerable jostling as countries work to meet the target requirements
for monetary union while trying to keep their electorates focused on the larger
goal of global competitiveness. Governments will be balancing the need to reduce
deficits and stimulate market reform while maintaining the public's confidence.
To avoid derailing these efforts, European countries generally are reluctant to
raise interest rates significantly without evidence of rapid economic
advancement. As a consequence, although in 1994 European interest rates rose in
parallel with U.S. rates, RCM anticipates that in 1997 European rates will
stabilize or rise less than U.S. rates.
HOW DID RCS DO THIS QUARTER?
For the quarter ended April 30, 1997, a steady dividend stream delivered returns
of 1.1% and 2.1% on a net asset value and market price basis, respectively.
Consistent with last quarter, RCS invested in three primary sectors: U.S.
mortgage-related securities, Europe and Latin America. The combination of these
sectors makes benchmark comparisons challenging. For reference, RCS provides
returns for three indices as representative of its primary market sectors:
mortgages, developed foreign and emerging markets. For the three-month period
ended April 30, RCS and related reference returns were:
<TABLE>
<CAPTION>
THREE MONTHS ENDED
REFERENCE RETURNS APRIL 30, 1997
- ----------------------------------------------------------------------
<S> <C>
RCS return on market price 2.09%
RCS return on net asset value 1.14%
Salomon Brothers Mortgage Security Index 0.79%
Salomon Brothers World Government Bond Index 0.60%
J.P. Morgan Emerging Market Bond Index 1.14%
</TABLE>
3
<PAGE>
FUND MANAGERS' DISCUSSION AND ANALYSIS
- ----------------------------------------
WERE THERE ANY SIGNIFICANT CHANGES TO THE FUND'S INVESTMENT POSITIONS THIS
QUARTER?
There were no significant changes in the Fund's income sources or geographical
exposure since fiscal year-end. U.S. positions are predominantly
mortgage-related instruments issued or guaranteed by the U.S. Government and its
agencies. Exposure to European and Canadian rates is accomplished through
interest rate swaps that are denominated in U.S. dollars. At quarter-end,
European and Canadian positions totaled $250 million in notional amount and
generally related to 5- and 7- year interest rates, as detailed on page 5.
Emerging market positions in Latin America, including government-guaranteed
securities of Mexico, Brazil and Argentina, made up 36% of total duration. All
RCS positions are denominated in U.S. dollars.
4
<PAGE>
SUPPLEMENTAL INFORMATION
- ----------------------------------------
INTEREST RATE SWAPS
An interest rate swap is a financial contract that typically involves an
exchange of obligations by two parties. For example, the Fund may exchange with
another party their respective rights to receive fixed interest rate payments
and floating interest rate payments. RCS will usually enter into interest rate
swaps on a net basis, which means that the two payment streams (one from the
Fund and one to the Fund) are netted out, with the Fund receiving or paying only
the net amount of the two payments.
Beginning in 1995, RCM sought to find a more efficient way to hold foreign bonds
in developed countries like Germany and The Netherlands, while minimizing
currency risk. RCM found, in U.S. dollar-denominated interest rate swaps, a way
to help RCS achieve its goals. First, swaps allow RCS to benefit from stable or
declining foreign interest rates. Second, they produce income. Third, they avoid
foreign currency exchange risk, since all interest payments and any future gains
or losses are in U.S. dollars.
As of April 30, 1997, the Fund had the following outstanding interest rate swap
agreements at the following rates:
<TABLE>
<CAPTION>
COUNTER-
NOTIONAL PARTY SWAP UNREALIZED
AMOUNT CREDIT TERMINATION MATURITY RATE RATE APPRECIATION
(000s) RATING COUNTRY DATE DATE RECEIVED PAID (DEPRECIATION)
- -------- -------- --------------- ----------- -------- -------- ----- -----------------
<S> <C> <C> <C> <C> <C> <C> <C>
$ 75,000 AA Germany 1/4/99 1/3/02 5.42% 3.45%+ $ 1,671,300
25,000 AAA The Netherlands 1/4/99 1/3/02 5.38% 3.37%+ 528,200
25,000 A The Netherlands 1/4/99 1/3/02 5.38% 3.37%+ 485,300
25,000 A Belgium 1/4/99 1/3/04 6.05% 3.50%+ 724,800
25,000 AAA Switzerland 1/4/99 1/3/04 4.08% 1.95%+ 1,018,450
25,000 A Finland 1/4/99 1/3/02 5.82% 3.75%+ 444,100
50,000 AAA Canada 1/4/99 1/3/04 6.05% 3.60%+ (1,239,950)
70,000 AA United States 3/1/98 3/1/98 5.69%* 5.49% 355,460
- -------- -----------------
$320,000 $ 3,987,660
- -------- -----------------
- -------- -----------------
</TABLE>
* FLOATING RATE BASED ON 1-MONTH LIBOR (LONDON INTERBANK OFFERED RATE).
+ FLOATING RATE BASED ON THE COUNTRY'S 6-MONTH INTERBANK OFFERED RATE.
5
<PAGE>
RCS INVESTMENT INCOME SUMMARY
- ---------------------------------
<TABLE>
<CAPTION>
3 MONTHS ENDED 3 MONTHS ENDED 3 MONTHS ENDED
APRIL 30, 1997 APRIL 30, 1997 APRIL 30, 1996
PERCENTAGE (000s) (000s)
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
UNITED STATES
Mortgage Pass-Throughs 38.5% $ 3,377 $ 3,769
Mortgage Projects/CMO's 18.6% 1,629 1,830
Mortgage Dollar Rolls 4.8% 420 543
Cash & Other 1.1% 92 42
- ----------------------------------------------------------------------------------------------------
Total United States 63.0% 5,518 6,184
- ----------------------------------------------------------------------------------------------------
DEVELOPED FOREIGN
Germany 4.3% 377 321
Canada 3.4% 299 --
The Netherlands 2.9% 256 225
Belgium 1.8% 155 145
Switzerland 1.5% 134 143
Finland 1.5% 132 125
- ----------------------------------------------------------------------------------------------------
Total Developed Foreign 15.4% 1,353 959
- ----------------------------------------------------------------------------------------------------
EMERGING MARKETS
Mexico 6.3% 553 452
Brazil 6.3% 552 355
Argentina 6.0% 527 515
Panama 2.3% 206 --
Colombia 0.7% 57 --
- ----------------------------------------------------------------------------------------------------
Total Emerging Markets 21.6% 1,895 1,322
- ----------------------------------------------------------------------------------------------------
RCS Totals 100.0% $ 8,766 $ 8,465
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
</TABLE>
6
<PAGE>
RCS PORTFOLIO SUMMARY
- ------------------------
<TABLE>
<CAPTION>
PERCENTAGE OF
AVERAGE DURATION TOTAL
APRIL 30, 1997 DURATION* CONTRIBUTION* DURATION
<S> <C> <C> <C>
- -----------------------------------------------------------------------------------------------
UNITED STATES
United States 0.6 0.2 4.3%
DEVELOPED FOREIGN
Germany 3.4 0.7 14.9%
Canada 4.6 0.6 12.8%
The Netherlands 3.4 0.5 10.6%
Switzerland 5.2 0.4 8.5%
Belgium 4.8 0.4 8.5%
Finland 3.4 0.2 4.3%
- -----------------------------------------------------------------------------------------------
Total Developed Foreign 4.0 2.8 59.6%
- -----------------------------------------------------------------------------------------------
EMERGING MARKETS
Brazil 8.4 0.5 10.6%
Argentina 7.4 0.5 10.6%
Mexico 7.3 0.4 8.5%
Panama 7.5 0.2 4.3%
Colombia 6.9 0.1 2.1%
- -----------------------------------------------------------------------------------------------
Total Emerging Markets 7.6 1.7 36.1%
- -----------------------------------------------------------------------------------------------
RCS Totals 4.7 4.7 100.0%
- -----------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------
</TABLE>
* IN YEARS. DURATION IS A MEASURE OF A BOND'S SENSITIVITY TO CHANGES IN INTEREST
RATES. FOR EXAMPLE, IF THE FUND'S DURATION WAS ONE YEAR AND INTEREST RATES
INCREASE 1%, THE VALUE OF THE FUND'S INVESTMENTS WOULD BE EXPECTED TO DECLINE
1%.
7
<PAGE>
INVESTMENTS IN SECURITIES AND NET ASSETS
- ----------------------------------------------------------
APRIL 30, 1997 (UNAUDITED)
<TABLE>
<CAPTION>
COUNTRY/ PRINCIPAL VALUE
CURRENCY (000's) DESCRIPTION (US$)
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INVESTMENTS IN DEBT SECURITIES - 113.1%*
ARGENTINA - 6.2%
USD Republic of Argentina
15,000 5.25% Step-Up Coupon, 03/31/23 $ 9,768,750
4,000 8.38%, 12/20/03 3,926,000
4,000 9.25%, 02/23/01 4,116,000
4,000 10.95%, 11/01/99 4,242,000
-------------
Total Argentina 22,052,750
-------------
BRAZIL - 6.3%
USD 16,249 Federal Republic of Brazil C Bond,
4.50% with 3.50% Interest Capitalization, 04/15/14 12,329,213
10,000 Federal Republic of Brazil, 8.88%, 11/05/01 10,100,000
-------------
Total Brazil 22,429,213
-------------
COLOMBIA - 1.0%
USD 4,000 Republic of Colombia, 7.63%, 02/15/07 3,754,000
-------------
MEXICO - 6.1%
USD United Mexican States
5,000 6.25%, 12/31/19 3,612,500
6,000 9.75%, 02/06/01 6,258,000
7,000 11.38%, 09/15/16 7,318,500
4,326 11.50%, 05/15/26 4,581,234
-------------
Total Mexico 21,770,234
-------------
PANAMA - 3.0%
USD 8,112 Panama PDI, 4.00% with 2.56%
Interest Capitalization, 07/17/16 6,865,186
4,000 Republic of Panama, 7.88%, 02/13/02, 144A** 3,934,000
-------------
Total Panama 10,799,186
-------------
UNITED STATES - 90.5%
USD MORTGAGE-BACKED SECURITIES - 71.7%
126,546 FHLMC 7.50%, 2025 - 2026 125,900,910
16,348 FNMA 7.50%, 2026 - 2027 16,233,685
9,461 GNMA 7.50%, 2006 - 2026 9,399,839
19,085 FHLMC 8.00%, 2023 - 2025 19,383,140
4,911 GNMA 8.00%, 2016 - 2022 5,049,907
699 GNMA 8.50%, 2016 - 2023 722,985
</TABLE>
* PERCENTAGE OF NET ASSETS
** SECURITY PURCHASED PURSUANT TO RULE 144A OF THE SECURITIES ACT OF 1933 AND
MAY BE RESOLD ONLY TO QUALIFIED INSTITUTIONAL BUYERS.
8
<PAGE>
INVESTMENTS IN SECURITIES AND NET ASSETS
- ----------------------------------------------------------
APRIL 30, 1997 (UNAUDITED)
<TABLE>
<CAPTION>
COUNTRY/ PRINCIPAL VALUE
CURRENCY (000's) DESCRIPTION (US$)
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
USD MORTGAGE-BACKED SECURITIES - (CONTINUED)
54,000 FNMA 7.50%, 2027 TBA $ 53,623,620
11,000 GNMA 7.50%, 2027 TBA 10,912,770
10,371 FHA Project Pool 56, 7.43%, 11/01/22 10,406,926
5,959 FHA Project Pool 144 S, 7.43%, 06/01/24 5,746,293
-------------
Total Mortgage-Backed Securities 257,380,075
-------------
USD COLLATERALIZED MORTGAGE OBLIGATIONS - 18.8%
DLJ Mortgage Acceptance Corp.
1,000 Series 1994-MF11, Class A2 8.10%, 06/18/04 1,019,063
4,850 Series 1994-MF11, Class A3 8.10%, 06/18/04 4,891,111
Federal Home Loan Mortgage Corp.
17,932 Series 1667, Class PE 6.00%, 03/15/08 17,161,484
22,786 Series 1665, Class N 6.50%, 01/15/24 20,554,866
G E Capital Mortgage Services, Inc.
4,451 Series 1994-12, Class B1 6.00%, 04/25/09 4,115,609
22,000 Series 1994-10, Class A15 6.50%, 03/25/24 19,836,094
-------------
Total Collateralized Mortgage Obligations 67,578,227
-------------
TOTAL INVESTMENTS -- (COST $399,440,608) 405,763,685
-------------
Payable for Investments Purchased -- (17.8%) (63,790,625)
Payable for Investments Sold on a Forward Commitment Basis, net -- (36.3%)+ (130,287,727)
Other Assets Less Liabilities -- 41.0% 147,121,272
-------------
NET ASSETS -- 100.0% $ 358,806,605
-------------
-------------
</TABLE>
TERMS
FHA -- Federal Housing Administration
FHLMC -- Federal Home Loan Mortgage Corporation
FNMA -- Federal National Mortgage Association
GNMA -- Government National Mortgage Association
TBA -- To Be Announced, Standard Settlement
USD -- United States Dollars
+ On a forward commitment basis, the Fund has agreed to sell the following U.S.
Treasury securities:
<TABLE>
<CAPTION>
PRINCIPAL VALUE
CURRENCY (000's) DESCRIPTION (US$)
<S> <C> <C> <C>
- ----------------------------------------------------------------------------
USD $ 56,600 U.S. Treasury Bonds 6.88%, 08/15/25 $ 55,588,558
USD 66,850 U.S. Treasury Bonds 8.13%, 08/15/21 75,053,164
--------- ------------
$ 123,450 (Cost $130,059,072) $130,641,722
--------- ------------
--------- ------------
</TABLE>
9
<PAGE>
SPECIAL FOCUS
- -------------
CREDIT RISK & RCS
Over the last year, U.S. bond investors have tended to accept more credit risk
in order to capture both higher yield and greater returns. The willingness to
accept increased credit risk is being expressed through investments in emerging
markets and high-yield corporate bonds (also commonly known as "junk bonds").
There are a number of factors that have contributed to this shift. Below is a
description of some of the factors and how RCS is positioned relative to this
trend.
In the United States, interest rates have declined substantially over the last
decade and a half, diminishing the absolute level of yields available to
investors. To receive an incremental yield above that of U.S. Treasuries,
investors often invest in investment grade corporate bonds. However, the yield
advantage of investment grade corporates over U.S. Treasuries is now at historic
lows. As RCS was established predominantly as a government fund, its ability to
use investment grade corporates is limited.
An alternative to investment grade corporates is found in mortgage-backed
securities. Mortgage securities provide returns as much as 1% higher than the
yield of U.S. Treasuries. In terms of creditworthiness, these bonds tend to be
issued by the U.S. Government and its agencies. In exchange for the higher
yield, the investor must manage the change in price sensitivity of the bonds as
homeowners prepay or refinance their mortgages. RCM's experience in mortgage
securities allows RCS to benefit from the higher yield and "Aaa" credit ratings
of these securities, despite their risk characteristics.
Non-investment grade bonds in the United States have benefited significantly
from the overall strength of the U.S. economy. Perception of the default
potential of these bonds has decreased substantially. As noted in the FUND
MANAGERS' DISCUSSION AND ANALYSIS, because of the secular global trend of lower
economic volatility, the credit quality of non-investment grade debt should
continue to improve. As with investment grade corporates, RCS's goal of holding
predominantly government issues limits our participation in high-yield
corporates.
10
<PAGE>
SPECIAL FOCUS
- -------------
Overseas, the secular trend of improved economic stability has driven the recent
successes of emerging market debt. Emerging market debt tends to be
non-investment grade with ratings often in the range of "B" to "BB." For
example, yields available on U.S. dollar denominated debt issued by Latin
American governments now range between 2% and 5% above U.S. Treasuries. This is
a general improvement (lower yield) of approximately 2% in the last year alone.
RCS takes government credit risk in emerging markets by focusing on the more
liquid countries of Latin America. In assessing the additional yield from
emerging market credit, RCM weighs the contribution to income against both the
overall credit and duration risks of the bonds.
RCS generally accepts increased credit risk to increase overall yield by
investing in the emerging market sector. The emerging market issuers in the RCS
portfolio are government-owned entities and are denominated in U.S. dollars. The
overall credit allocation of the Fund's total investments is shown below.
<TABLE>
<CAPTION>
CREDIT QUALITY
APRIL 30, 1997
PERCENTAGE OF
RATING TOTAL INVESTMENTS
- ------------------------------------------------------------------------------------------------
<S> <C>
AAA 77.6%
AA 0.3%
A 2.2%
BBB 0.9%
BB 13.5%
B 5.5%
------
Total 100.0%
</TABLE>
11
<PAGE>
DIVIDEND REINVESTMENT PLAN
- ---------------------------
Under the Fund's Dividend Reinvestment Plan (the "Plan"), a stockholder whose
shares of common stock are registered in his or her own name will have all
distributions from the Fund reinvested automatically by State Street Bank and
Trust Company (the "Plan Agent") as agent under the Plan, unless the stockholder
elects to receive cash. Distributions with respect to shares registered in the
name of a broker-dealer or other nominee (that is, in "street name") will be
reinvested by the broker or nominee in additional shares under the Plan, unless
that service is not provided by the broker or nominee or the stockholder elects
to receive distributions in cash.
When the market price of the common stock is equal to or exceeds the net asset
value per share of the common stock on the dividend payment date, Plan
participants will be issued shares of common stock valued at the net asset value
most recently determined or, if net asset value is less than 95% of the then
current market price of the common stock, at 95% of the market value.
If the market price of the common stock is less than the net asset value of the
common stock, or if the Fund declares a dividend or capital gains distribution
payable only in cash, a broker-dealer not affiliated with the Fund's principal
underwriter, as purchasing agent for Plan participants (the "Purchasing Agent"),
will buy common stock in the open market for the participants' accounts. If the
market price exceeds the net asset value of shares before the Purchasing Agent
has completed its purchases, the Purchasing Agent is permitted to cease
purchasing shares and the Fund may issue the remaining shares.
Plan participants are subject to no charge for reinvesting dividends and capital
gains distributions. The Plan Agent's fees for handling the reinvestment of
dividends and capital gains distributions will be paid by the Fund. No brokerage
charges apply with respect to shares of common stock issued directly by the
Fund. Each Plan participant will, however, bear a proportionate share of
brokerage commissions incurred with respect to open market purchases made in
connection with the reinvestment of dividends or capital gains distributions.
Plan participants may terminate their participation in the Plan by giving
written notice to the Plan Agent. The Fund reserves the right to amend or
terminate the Plan. To obtain a full description of the Plan or to obtain any
other information about the Plan, please contact State Street Bank and Trust
Company, P.O. Box 8209, Boston, Massachusetts 02266-8209 or call (800) 426-5523.
12
<PAGE>
CORPORATE INFORMATION
- -----------------------------
DIRECTORS
Gary W. Schreyer, CHAIRMAN
William A. Hasler
Francis E. Lundy
James M. Whitaker
AUDIT COMMITTEE
William A. Hasler
Francis E. Lundy
James M. Whitaker
NOMINATING COMMITTEE
Gary W. Schreyer
William A. Hasler
OFFICERS
Richard W. Ingram
PRESIDENT, CHIEF FINANCIAL OFFICER AND ASSISTANT TREASURER
John E. Pelletier
VICE PRESIDENT AND ASSISTANT SECRETARY
Elizabeth A. Keeley
VICE PRESIDENT AND ASSISTANT SECRETARY
Caroline M. Hirst
SECRETARY AND TREASURER
INVESTMENT MANAGER
RCM Capital Management, L.L.C.
Four Embarcadero Center
San Francisco, California 94111
PORTFOLIO MANAGERS
Eamonn F. Dolan
Stephen Kim
Jack L. Bernard
Mark E. Raaberg
ADMINISTRATOR, CUSTODIAN AND
TRANSFER AGENT
State Street Bank and Trust Company
1776 Heritage Drive
North Quincy, Massachusetts 02171
(800) 426-5523
INDEPENDENT AUDITORS
Coopers & Lybrand L.L.P.
One Post Office Square
Boston, Massachusetts 02109
COUNSEL
Ropes & Gray
One International Place
Boston, Massachusetts 02110-2624
RCM Capital Management, L.L.C. is an institutional money manager headquartered
in San Francisco with approximately $26 billion in managed assets, including
approximately $10 billion in fixed income securities. RCM has over 20 years of
experience in active fixed income investment management for corporate retirement
plans, endowments, foundations, insurance companies, nuclear decommissioning
trusts and select individuals.
<PAGE>
RCM STRATEGIC GLOBAL
GOVERNMENT FUND, INC.
MARKET PRICES FOR RCS SHARES ARE PUBLISHED DAILY IN THE WALL STREET JOURNAL AS
"RCM STRATG," AND IN THE NEW YORK TIMES AS "RCMSTGLFD," AND IN LOCAL NEWSPAPERS
IN THE NEW YORK STOCK EXCHANGE LISTINGS. NET ASSET VALUE IS PUBLISHED WEEKLY
AND APPEARS EACH MONDAY IN THE WALL STREET JOURNAL AND IN THE NEW YORK TIMES
UNDER THE CAPTION "CLOSED-END BOND FUNDS." THE WEEKLY NET ASSET VALUE IS ALSO
AVAILABLE EACH SATURDAY IN BARRON'S.
THIS REPORT IS SENT TO THE SHAREHOLDERS OF RCS FOR THEIR INFORMATION. THE
FINANCIAL INFORMATION INCLUDED HEREIN IS TAKEN FROM THE RECORDS OF THE FUND.
THIS IS NOT A PROSPECTUS, CIRCULAR OR REPRESENTATION INTENDED FOR USE IN THE
PURCHASE OR SALE OF SHARES OF THE FUND OR OF ANY SECURITIES MENTIONED IN THE
REPORT. IF YOU WOULD LIKE A COPY OF THE MOST RECENT ANNUAL REPORT (INCLUDING
AUDITED FINANCIAL STATEMENTS), PLEASE CONTACT YOUR BROKER OR CALL RCM DIRECTLY
AT (415) 954-5400.
INVESTMENT MANAGER:
RCM CAPITAL MANAGEMENT, L.L.C.
FOUR EMBARCADERO CENTER
SAN FRANCISCO, CALIFORNIA 94111
