<PAGE> 1
[PHOTO]
OPPENHEIMER INTERNATIONAL BOND FUND
Semiannual Report March 31, 1997
"We want
our money
to work
as hard
as it can."
[OPPENHEIMERFUNDS LOGO]
<PAGE> 2
THIS FUND IS FOR PEOPLE WHO WANT TO TAKE ADVANTAGE OF INTERNATIONAL
OPPORTUNITIES OFFERING THE POTENTIAL FOR GROWTH ALONG WITH INCOME.
YIELD
STANDARDIZED YIELDS
For the 30 Days Ended 3/31/97:(4)
Class A
9.51%
Class B
9.20%
Class C
9.19%
BEAT THE AVERAGE
Total Return for the 1-Year Period
Ended 3/31/97:
Oppenheimer International
Bond Fund
Class A Shares (at net asset value)(2)
15.87%
Lipper International Income
Average for 45 Funds for the
1-Year Period Ended 3/31/97(5)
4.85%
HOW YOUR FUND IS MANAGED
Oppenheimer International Bond Fund seeks high total return by investing
primarily in foreign debt securities. The Fund currently emphasizes investments
in government debt securities issued by developed countries such as Germany and
Switzerland as well as emerging market countries such as Malaysia and
Brazil.(1)
PERFORMANCE
Total returns for the six months ended 3/31/97 were 5.76% for Class A shares,
5.38% for Class B shares and 5.19% for Class C shares, without deducting sales
charges.(2)
Your Fund's average annual total returns for Class A shares for the
1-year period ended 3/31/97 and since inception were 10.37% and 13.66%,
respectively. For Class B shares, average annual total returns for the 1-year
period ended 3/31/97 and since inception were 10.04% and 13.82%, respectively.
For Class C shares, average annual total returns for the 1-year period ended
3/31/97 and since inception were 13.85% and 15.70%, respectively. The Fund's
inception date (all classes) was 6/15/95.(3)
OUTLOOK
"While we expect that this year's returns may be slightly less than last
year's--due to anticipated lower returns in emerging markets--we believe
international bonds will continue to outperform many other asset classes in the
coming months."
Ashwin Vasan, Portfolio Manager
March 31, 1997
Total returns include change in share price and reinvestment of dividends and
capital gains distributions in a hypothetical investment for the periods shown.
IN REVIEWING PERFORMANCE AND RANKINGS, PLEASE REMEMBER THAT PAST PERFORMANCE
DOES NOT GUARANTEE FUTURE RESULTS. INVESTMENT RETURN AND PRINCIPAL VALUE OF AN
INVESTMENT IN THE FUND WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN
REDEEMED, MAY BE WORTH MORE OR LESS THAN THE ORIGINAL COST.
1. The Fund's portfolio is subject to change.
2. Includes change in net asset value per share without deducting any sales
charges. Such performance is not annualized and would have been lower if sales
charges were taken into account.
3. Class A returns include the current maximum initial sales charge of 4.75%.
Class B returns include the applicable contingent deferred sales charge of 5%
(1 year) and 4% (since inception). Class C returns include the 1% contingent
deferred sales charge for the 1-year result. An explanation of the different
returns is in the Fund's prospectus. Class B and Class C shares are subject to
an annual 0.75% asset-based sales charge.
4. Standardized yield is based on net investment income for the 30-day period
ended 3/31/97. Falling net asset values will tend to artificially raise yields.
5. Source: Lipper Analytical Services, 3/31/97. The Lipper average is shown for
comparative purposes only. Funds included in the index may have different
investment policies and risks than the Fund. Oppenheimer International Bond
Fund is characterized as an international income fund. Lipper performance is
based on total return and does not take sales charges into account.
2 Oppenheimer International Bond Fund
<PAGE> 3
[PHOTO]
James C. Swain
Chairman
Oppenheimer
International
Bond Fund
[PHOTO]
Bridget A. Macaskill
President
Oppenheimer
International
Bond Fund
DEAR SHAREHOLDER,
As we enter the second quarter, we are optimistic about investing in the
international fixed income markets. A strong U.S. dollar and the beginnings of
stronger international growth combined with the potential benefits of
international investing, namely diversification, higher current income and
higher returns, create a favorable environment for those investing for the long
term.
In general, international fixed income investments provide an extra
source of diversification to protect your portfolio from the more frequent ups
and downs experienced by domestic fixed income and stock market investments. In
addition to trying to reduce portfolio risk, we manage our fixed income
investments for total return. This means we seek investments that can provide
high current income and growth potential.
The international fixed income markets were highly influenced by the
appreciating U.S. dollar throughout the last six months. In general,
international bonds are highly susceptible to movements in both U.S. interest
and currency rates. The most closely linked investments are dollar-denominated
Brady Bonds, mainly concentrated in Latin America. After high returns in the
early part of 1996, these investments maintained strong, though more moderate,
returns for the period. As the strength of the Brady Bonds receded slightly,
other locally denominated bonds from emerging markets in Eastern Europe,
Greece, Mexico, Indonesia, Malaysia and Russia provided reasonably strong
investment opportunities.
In addition, the beginnings of stronger economic growth in Europe and
countries with dollar-denominated currencies, like Australia and Canada,
provided both growth and income potential. As we head toward 1999 and European
Currency Union, we will closely watch to see how the outcome will affect
European bond market opportunities.
The Japanese bond market has been undesirable for the period. The
Japanese economy has been in a slump for the past year and a half. The
government, in an effort to stimulate growth, has been artificially keeping
short-term interest rates at an all-time low of 1/2-1%. When the economy begins
to grow, and the government steps back from its supportive position, we can
expect to see a large rise in interest rates. This anticipated volatility in
rates makes it difficult to find suitable investments.
Because investing abroad involves greater risk and expenses--including
political and economic uncertainties, currency-rate fluctuations and liquidity
restrictions--it should be undertaken with a long-term approach in mind. We are
confident that by diversifying throughout the world, an investor should be
well-positioned to participate in any economic environment.
Your portfolio managers discuss the outlook for your Fund in light of
these broad issues on the following pages. Thank you for your confidence in
OppenheimerFunds, The Right Way to Invest. We look forward to helping you
reach your investment goals in the future.
/s/ JAMES C. SWAIN /s/ BRIDGET A. MACASKILL
James C. Swain Bridget A. Macaskill
April 21, 1997
3 Oppenheimer International Bond Fund
<PAGE> 4
Q + A
ASHWIN VASAN
Portfolio Manager
AN INTERVIEW WITH YOUR FUND'S MANAGERS.
HOW HAS THE FUND PERFORMED?
The Fund performed extremely well. In fact, Oppenheimer International Bond
Fund's Class A shares ranked 4th out of 45 international income funds,
according to Lipper Analytical Services, for the 1-year period ended
3/31/97.(1)
WHAT FACTORS CONTRIBUTED TO THE FUND'S SUCCESS?
We attribute the Fund's positive performance to three factors. First, the Fund
was broadly invested in emerging market countries. With the exception of a
slight drop during the fourth quarter of 1996, emerging markets have continued
to deliver strong performance results. The second factor was being
well-positioned to take advantage of that fourth-quarter decline and further
increase our exposure to emerging markets when the time was right. And third,
because the U.S. dollar was strong during much of the period, we were able to
protect the portfolio's assets by using currency hedges to seek to balance our
European exposure.(2)
WHAT CHANGES HAVE YOU MADE TO THE PORTFOLIO?
We shifted a portion of our assets out of Brady bonds (U.S. dollar-denominated
bonds of developing countries)--from Latin America, in particular--into foreign
currency instruments with shorter maturities. Because Brady bonds had
above-market returns last year, we were concerned how long this performance
level could continue. In addition, we diversified among local currency
instruments from many countries, such as Mexico, Poland and Russia. Of course,
international investments entail greater expenses and risks, such as adverse
currency fluctuations, but by diversifying our investments across many
countries and industries, we seek to mitigate those risks.
Within the developed market sector, we increased our exposure to
Australia and Canada. Both of these countries are major exporters of
commodities. If worldwide growth, inflation and commodity prices rise in the
near future, as we expect they will, our holdings in these countries should
perform well.
WERE THERE ANY COUNTRIES THAT YOU PURPOSELY AVOIDED?
We've limited our investments in Japan due to current difficulties within their
banking system and government bond market. With banks supporting and buying
government bonds, the supply has decreased. This shortage has caused bond
prices to rise, and yields to remain low.
We are also refraining from investing in Hong Kong until after the
handover to China in June of this year. Because Hong Kong is a major financial
center for the region, we are remaining cautious in our approach to investments
there, choosing to wait and closely monitoring any financial implications that
may accompany this transition.
WHAT IS YOUR OUTLOOK FOR THE FUND?
Our outlook for international bond investing remains very positive. While we
expect that this year's returns may be slightly less than last year's--due to
anticipated lower returns in emerging markets--we believe international bonds
will continue to outperform many other asset classes in the coming months.
1. Source: Lipper Analytical Services, 3/31/97. Oppenheimer International Bond
Fund is characterized by Lipper as an international income fund. Lipper
rankings are based on total return and do not take sales charges into account.
2. The Fund's portfolio is subject to change. Foreign bonds offer exceptional
opportunities, but are also subject to special risks, such as political and
currency exchange rate uncertainties.
4 Oppenheimer International Bond Fund
<PAGE> 5
STATEMENT OF INVESTMENTS March 31, 1997 (Unaudited)
<TABLE>
<CAPTION>
FACE MARKET VALUE
AMOUNT(1) SEE NOTE 1
===================================================================================================================================
<S> <C> <C>
FOREIGN GOVERNMENT OBLIGATIONS--51.4%
- -----------------------------------------------------------------------------------------------------------------------------------
ARGENTINA--2.8%
Argentina (Republic of):
Bonds, Bonos de Consolidacion de Deudas, Series I, 3.176%, 4/1/01(2)(3) (ARP) 2,071,371 $ 1,830,365
Discount Bonds, 6.375%, 3/31/23(2) 2,300,000 1,860,125
----------------------------------------------------------------------------------------------------------------------------
Banco Hipotecario Nacional (Argentina) Medium-Term Nts.,
10.625%, 8/7/06(4) 600,000 618,000
----------------------------------------------------------------------------------------------------------------------------
Buenos Aires (Province of) Bonds, 10%, 3/5/01(4) (DEM) 1,680,000 1,089,528
------------
5,398,018
- -----------------------------------------------------------------------------------------------------------------------------------
AUSTRALIA--3.8%
Australia (Commonwealth of) Treasury Bills, Zero Coupon,
5.905%, 5/22/97(5) (AUD) 1,085,000 843,732
----------------------------------------------------------------------------------------------------------------------------
South Australia Government Finance Authority Bonds, 10%, 1/15/03 (AUD) 5,740,000 4,937,955
----------------------------------------------------------------------------------------------------------------------------
Western Australia Treasury Corp. Gtd. Bonds, 12%, 8/1/01 (AUD) 1,845,000 1,681,087
------------
7,462,774
- -----------------------------------------------------------------------------------------------------------------------------------
BRAZIL--1.3%
Brazil (Federal Republic of):
Gtd. Disc. Bonds, 6.50%, 4/15/24(2) 1,940,000 1,560,487
Multi-Year Discount Facility Agreement Trust Certificates,
Series REGS, 6.547%, 9/15/07(2)(6) 800,474 705,918
----------------------------------------------------------------------------------------------------------------------------
Telecomunicacoes Brasileiras SA Medium-Term Nts., 11.301%, 12/9/99(2) 200,000 209,500
------------
2,475,905
- -----------------------------------------------------------------------------------------------------------------------------------
CANADA--5.2%
Canada (Government of) Debs., 10.50%, 7/1/00(4)(7) (CAD) 12,145,000 10,068,543
- -----------------------------------------------------------------------------------------------------------------------------------
COSTA RICA--0.2%
Central Bank of Costa Rica Interest Claim Bonds:
Series A, 6.312%, 5/21/05(2) 329,791 313,302
Series B, 6.312%, 5/21/05(2) 159,831 148,643
------------
461,945
- -----------------------------------------------------------------------------------------------------------------------------------
ECUADOR--1.5%
Ecuador (Republic of) Disc. Bonds, 6.437%, 2/28/25(2)(4) 4,500,000 2,913,750
- -----------------------------------------------------------------------------------------------------------------------------------
FINLAND--2.7%
Finland (Republic of) Treasury Bills, Zero Coupon:
2.94%, 4/15/97(5) (FIM) 13,190,000 2,657,633
2.871%, 5/15/97(5) (FIM) 13,190,000 2,654,438
------------
5,312,071
- -----------------------------------------------------------------------------------------------------------------------------------
GREAT BRITAIN--4.9%
United Kingdom Treasury Nts., 12.50%, 11/21/05 (GBP) 4,665,000 9,592,082
- -----------------------------------------------------------------------------------------------------------------------------------
INDONESIA--0.8%
Bank Tabugan Negara Negotiable CD, Zero Coupon, 13.151%, 2/3/98(5) (IDR) 601,802,000 225,658
----------------------------------------------------------------------------------------------------------------------------
PT Hutama Karya Medium-Term Nts., Zero Coupon:
15.103%, 4/15/97(5) (IDR) 2,000,000,000 830,495
15.867%, 7/25/97(5) (IDR) 1,500,000,000 598,639
------------
1,654,792
- -----------------------------------------------------------------------------------------------------------------------------------
ITALY--6.5%
Italy (Republic of):
Sr. Unsec. Unsub. Global Bonds, .566%, 7/26/99(2)(4) (JPY) 632,000,000 5,131,903
Treasury Bonds, Buoni del Tesoro Poliennali:
10.50%, 11/1/98(4) (ITL) 4,335,000,000 2,712,866
10.50%, 4/1/00 (ITL) 3,335,000,000 2,154,631
12%, 1/1/02(4) (ITL) 3,800,000,000 2,647,073
------------
12,646,473
- -----------------------------------------------------------------------------------------------------------------------------------
JORDAN--1.4%
Hashemite (Kingdom of) Jordan Disc. Bonds, 6.50%, 12/23/23(2)(4) 3,500,000 2,791,250
</TABLE>
5 Oppenheimer International Bond Fund
<PAGE> 6
STATEMENT OF INVESTMENTS (Unaudited) (Continued)
<TABLE>
<CAPTION>
FACE MARKET VALUE
AMOUNT(1) SEE NOTE 1
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
MEXICO--5.6%
Bonos de la Tesoreria de la Federacion, Zero Coupon:
26.249%, 10/2/97(5) (MXP) 12,869,330 $ 1,454,067
25.785%, 11/6/97(5) (MXP) 9,950,000 1,102,580
24.602%, 12/4/97(5) (MXP) 9,915,000 1,081,512
22.896%, 2/4/98(5) (MXP) 8,179,960 861,057
22.666%, 3/5/98(5) (MXP) 9,500,000 984,019
28.77%, 7/3/97(5) (MXP) 10,432,260 1,245,137
28.59%, 7/31/97(5) (MXP) 6,200,000 727,842
27.80%, 9/4/97(5) (MXP) 9,750,000 1,121,785
----------------------------------------------------------------------------------------------------------------------------
Mexican Williams Bonds, 6.631%, 11/15/08(2)(8) 500,000 447,500
----------------------------------------------------------------------------------------------------------------------------
Petroleos Mexicanos, 14.50% Debs., 3/31/06(4)(8) (GBP) 1,000,000 1,909,201
------------
10,934,700
- -----------------------------------------------------------------------------------------------------------------------------------
NEW ZEALAND--2.8%
New Zealand (Government of):
Bonds, 8%, 4/15/04(4) (NZD) 2,160,000 1,503,455
Index Linked Bonds, 4.60%, 2/15/16(4) (NZD) 5,960,000 3,973,450
------------
5,476,905
- -----------------------------------------------------------------------------------------------------------------------------------
POLAND--4.5%
Poland (Republic of) Bonds:
12%, 6/12/01 (PLZ) 8,300,000 2,175,868
16%, 10/12/98 (PLZ) 10,500,000 3,186,327
16%, 2/12/99 (PLZ) 4,750,000 1,437,417
21%, 6/5/97 (PLZ) 5,995,000 1,929,604
------------
8,729,216
- -----------------------------------------------------------------------------------------------------------------------------------
PORTUGAL--2.2%
Portugal (Republic of) Bonds, Obrigicion do tes Medio Prazo,
11.875%, 2/23/00 (PTE) 623,000,000 4,253,229
- -----------------------------------------------------------------------------------------------------------------------------------
ROMANIA--0.6%
Romanian Commercial Bank Bonds, 9.125%, 3/10/00(8) 1,245,000 1,220,878
- -----------------------------------------------------------------------------------------------------------------------------------
SOUTH AFRICA--1.2%
South Africa (Republic of) Bonds, Series 162, 12.50%, 1/15/02 (ZAR) 11,832,000 2,445,902
- -----------------------------------------------------------------------------------------------------------------------------------
VENEZUELA--3.4%
Venezuela (Republic of) New Money Bonds, Series A, 6.625%, 12/18/05(2) 750,000 656,719
----------------------------------------------------------------------------------------------------------------------------
Venezuela Synthetic Sovereign Sec. Bonds:
10.125%, 12/29/03(4) (DEM) 5,730,000 3,466,643
11.50%, 12/28/07(4) (DEM) 4,280,000 2,616,651
------------
6,740,013
------------
Total Foreign Government Obligations (Cost $102,556,354) 100,578,446
===================================================================================================================================
LOAN PARTICIPATIONS--4.3%
- -----------------------------------------------------------------------------------------------------------------------------------
Algeria (Republic of) Reprofiled Debt Loan Participation, Tranche A:
1.812%, 9/4/06(2) (JPY) 104,400,000 573,921
6.977%, 9/4/06(2) 5,075,000 3,987,047
----------------------------------------------------------------------------------------------------------------------------
Colombia (Republic of) Concorde Loan Participation, 8.625%, 1/31/98(2)(8) 57,000 55,575
----------------------------------------------------------------------------------------------------------------------------
Jamaica (Government of) 1990 Refinancing Agreement Nts.:
Tranche A, 6.437%, 10/16/00(2)(8) 179,999 171,900
Tranche B, 6.312%, 11/15/04(2)(8) 2,875,000 2,530,000
----------------------------------------------------------------------------------------------------------------------------
Trinidad & Tobago Loan Participation Agreement:
Tranche A, 1.50%, 9/30/00(2)(8) (JPY) 79,672,727 592,027
Tranche B, 1.50%, 9/30/00(2)(8) (JPY) 69,364,962 515,433
------------
Total Loan Participations (Cost $8,436,092) 8,425,903
</TABLE>
6 Oppenheimer International Bond Fund
<PAGE> 7
<TABLE>
<CAPTION>
FACE MARKET VALUE
AMOUNT(1) SEE NOTE 1
===================================================================================================================================
<S> <C> <C>
CORPORATE BONDS AND NOTES--20.9%
- -----------------------------------------------------------------------------------------------------------------------------------
BASIC INDUSTRY--2.2%
- -----------------------------------------------------------------------------------------------------------------------------------
METALS/MINING--0.5%
Royal Oak Mines, Inc., 11% Sr. Sub. Nts., 8/15/06 $ 1,000,000 $ 1,027,500
- -----------------------------------------------------------------------------------------------------------------------------------
PAPER--1.7%
Asia Pulp & Paper International Finance Co.,
Zero Coupon Asian Currency Nts.:
16.317%, 11/14/97(5) (IDR) 3,000,000,000 1,148,644
14.712%, 12/8/97(5) (IDR) 300,000,000 113,867
17.875%, 5/1/97(5)(6) (IDR) 1,000,000,000 412,778
15.789%, 5/15/97(5)(6) (IDR) 550,000,000 225,853
----------------------------------------------------------------------------------------------------------------------------
Indah Kiat International Finance Co. BV:
12.50% Gtd. Sec. Nts., 6/15/06 800,000 888,000
12.50% Gtd. Sr. Sec. Nts., Series C, 6/15/06 500,000 555,000
------------
3,344,142
- -----------------------------------------------------------------------------------------------------------------------------------
CONSUMER RELATED--1.9%
- -----------------------------------------------------------------------------------------------------------------------------------
CONSUMER PRODUCTS--0.7%
TAG Heuer International SA, 12% Sr. Sub. Nts., 12/15/05 70,000 79,975
----------------------------------------------------------------------------------------------------------------------------
Tjiwi Kimia International Finance Co. BV:
13.25% Gtd. Sr. Nts., 8/1/01 200,000 225,500
13.25% Gtd. Sr. Nts., 8/1/01 960,000 1,082,400
------------
1,387,875
- -----------------------------------------------------------------------------------------------------------------------------------
HOTEL/GAMING--0.4%
Grupo Posadas SA de CV, 10.375% Bonds, 2/13/02(6) 700,000 694,312
- -----------------------------------------------------------------------------------------------------------------------------------
TEXTILE/APPAREL--0.8%
Indorayon International Finance Co. BV, 10% Gtd. Unsec. Unsub. Nts., 3/29/01 1,500,000 1,503,750
- -----------------------------------------------------------------------------------------------------------------------------------
FINANCIAL SERVICES--11.5%
- -----------------------------------------------------------------------------------------------------------------------------------
BANKS & THRIFTS--5.2%
Banco de Colombia, 5.20% Cv. Jr. Unsec. Sub. Nts., 2/1/99(8) 2,050,000 1,855,250
----------------------------------------------------------------------------------------------------------------------------
Bank Dagang Nasional Indonesia, Zero Coupon Negotiable CD,
13.603%, 11/20/97(5) (IDR) 2,000,000,000 767,641
----------------------------------------------------------------------------------------------------------------------------
Citibank Malaysia Banker's Acceptance, Zero Coupon Negotiable CD:
7.191%, 4/25/97(5) (MYR) 3,900,000 1,567,387
7.19%, 5/16/97(5) (MYR) 4,000,000 1,600,876
7.121%, 5/26/97(5) (MYR) 4,150,000 1,657,619
----------------------------------------------------------------------------------------------------------------------------
Deutsche Bank Malaysia, Zero Coupon Negotiable CD, 6.943%, 7/15/97(5) (MYR) 902,000 356,750
----------------------------------------------------------------------------------------------------------------------------
Ongko International Finance Co. BV, 10.50% Gtd. Nts., 3/29/04(6) 850,000 846,812
----------------------------------------------------------------------------------------------------------------------------
Standard Charter Berhad Banker's Acceptance,
Zero Coupon Negotiable CD, 7.315%, 4/1/97(5) (MYR) 3,900,000 1,573,029
------------
10,225,364
- -----------------------------------------------------------------------------------------------------------------------------------
DIVERSIFIED FINANCIAL--6.3%
Bakrie Investindo, Zero Coupon:
Indonesian Commercial Paper, 16.625%, 7/30/97(5) (IDR) 1,790,000,000 707,439
Promissory Nts., 17.351%, 3/16/98(5) (IDR) 3,310,000,000 1,177,733
----------------------------------------------------------------------------------------------------------------------------
General Electric Capital Corp., 11.625% Nts., 10/29/97 (SKK) 54,000,000 1,619,687
----------------------------------------------------------------------------------------------------------------------------
PT Polysindo Eka Perkasa, Zero Coupon Promissory Nts.:
16.485%, 3/14/98(5) (IDR) 2,550,000,000 912,516
9.39%, 7/14/98(5) 500,000 443,022
9.374%, 7/28/98(5) 1,000,000 883,002
----------------------------------------------------------------------------------------------------------------------------
Snap Ltd., 11.50% Sec. Bonds, 1/29/09 (DEM) 10,380,000 6,571,522
------------
12,314,921
</TABLE>
7 Oppenheimer International Bond Fund
<PAGE> 8
STATEMENT OF INVESTMENTS (Unaudited) (Continued)
<TABLE>
<CAPTION>
FACE MARKET VALUE
AMOUNT(1) SEE NOTE 1
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
MANUFACTURING--0.5%
- -----------------------------------------------------------------------------------------------------------------------------------
AUTOMOTIVE--0.5%
Ioche-Maxion SA, 12.375% Medium-Term Nts., 11/8/02 $ 850,000 $ 857,438
- -----------------------------------------------------------------------------------------------------------------------------------
MEDIA--0.1%
- -----------------------------------------------------------------------------------------------------------------------------------
CABLE TELEVISION--0.1%
Rogers Cablesystems Ltd., 10% Second Priority Sr. Sec. Debs., 12/1/07 150,000 156,375
----------------------------------------------------------------------------------------------------------------------------
United International Holdings, Inc., Zero Coupon Sr. Sec. Disc. Nts.,
12.495%, 11/15/99(5) 35,000 25,200
------------
181,575
- -----------------------------------------------------------------------------------------------------------------------------------
OTHER--1.7%
- -----------------------------------------------------------------------------------------------------------------------------------
CONGLOMERATES--1.7%
Empresas ICA Sociedad Controladora SA de CV, 5% Cv. Sub. Debs., 3/15/04 2,000,000 1,515,000
----------------------------------------------------------------------------------------------------------------------------
Mechala Group Jamaica Ltd.:
12% Bonds, 2/15/02(6) 250,000 253,281
12.75% Bonds, 12/30/99(6) 1,500,000 1,542,188
------------
3,310,469
- -----------------------------------------------------------------------------------------------------------------------------------
RETAIL--0.8%
- -----------------------------------------------------------------------------------------------------------------------------------
SPECIALTY RETAILING--0.8%
Central Termica Guemes, 12% Bonds, 11/26/01(8) 1,500,000 1,541,250
- -----------------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION--0.1%
- -----------------------------------------------------------------------------------------------------------------------------------
SHIPPING--0.1%
Gearbulk Holding Ltd., 11.25% Sr. Nts., 12/1/04 150,000 164,625
- -----------------------------------------------------------------------------------------------------------------------------------
UTILITIES--2.1%
- -----------------------------------------------------------------------------------------------------------------------------------
ELECTRIC UTILITIES--0.7%
CE Casecnan Water & Energy, Inc.:
11.95% Sr. Nts., Series B, 11/15/10 200,000 223,875
11.45% Sr. Nts., Series A, 11/15/05 500,000 547,188
----------------------------------------------------------------------------------------------------------------------------
Centragas Natural Gas Transmission System, 10.65% Sr. Sec. Bonds, 12/1/10(6) 579,160 620,426
------------
1,391,489
- -----------------------------------------------------------------------------------------------------------------------------------
TELECOMMUNICATIONS--1.4%
Call-Net Enterprises, Inc., 0%/13.25% Sr. Disc. Nts., 12/1/04(9) 500,000 420,000
----------------------------------------------------------------------------------------------------------------------------
Celcaribe SA, 0%/13.50% Sr. Sec. Nts., 3/15/04(8)(9) 75,000 64,500
----------------------------------------------------------------------------------------------------------------------------
Comunicacion Celular SA, 0%/13.125% Sr. Deferred Coupon Bonds, 11/15/03(9) 1,600,000 1,108,000
----------------------------------------------------------------------------------------------------------------------------
Occidente y Caribe Celular SA, 0%/14% Sr. Disc. Nts., Series B, 3/15/04(8)(9) 2,000,000 1,240,000
------------
2,832,500
------------
Total Corporate Bonds and Notes (Cost $40,509,800) 40,777,210
<CAPTION>
SHARES
===================================================================================================================================
<S> <C> <C>
COMMON STOCKS--0.2%
- -----------------------------------------------------------------------------------------------------------------------------------
Air New Zealand Ltd., Cl. B (Cost $394,974) 145,000 394,920
<CAPTION>
UNITS
===================================================================================================================================
<S> <C> <C>
RIGHTS, WARRANTS AND CERTIFICATES--0.1%
- -----------------------------------------------------------------------------------------------------------------------------------
Comunicacion Celular SA Wts., Exp. 11/03(8) 1,600 112,000
----------------------------------------------------------------------------------------------------------------------------
Occidente y Caribe Celular SA Wts., Exp. 3/04(8) 8,000 80
---------
Total Rights, Warrants and Certificates (Cost $15,000) 112,080
<CAPTION>
FACE
AMOUNT(1)
===================================================================================================================================
<S> <C> <C>
STRUCTURED INSTRUMENTS--14.1%
- -----------------------------------------------------------------------------------------------------------------------------------
Bayerische Landesbank CD, New York Branch, 13.75%, 8/18/97
(indexed to the cross currency rates of Greek Drachma and Chilean Peso) $ 800,000 796,000
----------------------------------------------------------------------------------------------------------------------------
Bayerische Landesbank Girozentrale, New York Branch,
Deutsche Mark Currency Protected Yield Curve CD, 6.28%, 7/25/97 300,000 303,915
</TABLE>
8 Oppenheimer International Bond Fund
<PAGE> 9
<TABLE>
<CAPTION>
FACE MARKET VALUE
AMOUNT(1) SEE NOTE 1
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
STRUCTURED INSTRUMENTS
(CONTINUED)
Canadian Imperial Bank of Commerce CD, New York Branch:
11.25%, 9/4/97 (indexed to the Russian Federation GKO,
Zero Coupon, 8/27/97)(8) $ 500,000 $ 496,000
16.75%, 4/16/97 (indexed to the Federation GKO, Zero Coupon, 4/9/97) 3,700,000 3,697,688
17%, 4/2/97 (indexed to the Russian Federation GKO,
Zero Coupon, 3/26/97) 500,000 496,875
----------------------------------------------------------------------------------------------------------------------------
Canadian Imperial Bank, U.S. Dollar CD Linked to
South African Rand, 17%, 1/21/98 1,125,000 1,127,812
----------------------------------------------------------------------------------------------------------------------------
ING (U.S.) Capital Holdings Corp., Zero Coupon GKO
Pass-Through Nts., 15.059%, 5/21/97(5) 1,500,000 1,470,480
----------------------------------------------------------------------------------------------------------------------------
ING (U.S.) Financial Holdings Corp., Zero Coupon:
Korean Won/U.S. Dollar Linked Nts., 10.87%, 6/9/97(5) 750,000 673,080
Nts., Linked to the Czech Koruna/Swiss Franc Exchange Rate,
14.485%, 2/18/98(5) 1,035,000 866,709
Nts., Linked to the Greek Drachma/Swiss Franc Exchange Rate,
14.437%, 12/10/97(5) 519,362 470,080
Nts., Linked to the Greek Drachma/Swiss Franc Exchange Rate,
14.829%, 12/4/97(5) 1,500,000 1,352,745
Nts., Linked to the Slovakia Koruna/Swiss Franc Exchange Rate,
16.542%, 8/11/97(5) 1,700,000 1,531,700
South African Rand/U.S. Dollar Linked Nts., 16.102%, 2/25/98(5) 1,250,000 1,100,125
----------------------------------------------------------------------------------------------------------------------------
Lehman Brothers Holdings, Inc.:
U.S. Dollar Nts. Linked to Czech Koruna/Swiss Franc, 15%, 12/21/98 1,500,000 1,499,250
Zero Coupon:
Greek Drachma/Swiss Franc Linked Nts., 14.709%, 1/15/98(5) 3,000,000 3,006,600
U.S. Dollar Nts. Linked to Greek Drachma/Swiss Franc, 15.639%, 12/23/97(5) 500,000 528,500
U.S. Dollar Nts. Linked to Greek Drachma/Swiss Franc, 15.453%, 12/26/97(5) 1,000,000 1,056,200
U.S. Dollar Nts. Linked to Greek Drachma/Swiss Franc, 15.499%, 12/30/97(5) 1,600,000 1,674,560
U.S. Dollar Nts. Linked to Czech Koruna/Swiss Franc, 15.411%, 12/29/97(4)(5) 1,800,000 1,900,260
----------------------------------------------------------------------------------------------------------------------------
Salomon Brothers, Inc., Zero Coupon Brazilian Credit Linked Nts., 9.896%,
5/2/97 (indexed to the Brazilian National Treasury Nts., Zero Coupon, 5/3/97)(5) 450,000 446,580
----------------------------------------------------------------------------------------------------------------------------
Salomon, Inc., Zero Coupon Russia S-Account Credit Linked Nts.:
12.152%, 8/7/97(5) 900,000 859,950
12.068%, 8/8/97(5) 1,950,000 1,862,445
----------------------------------------------------------------------------------------------------------------------------
Swiss Bank Corp. CD, New York Branch, 6.05%, 6/20/97 (indexed to
the closing Nikkei 225 Index on 1/23/97, 5 yr. & 3 mos. Japanese Yen
Swap rate & New Zealand Dollar) 400,000 416,260
------------
Total Structured Instruments (Cost $27,858,508) 27,633,814
</TABLE>
9 Oppenheimer International Bond Fund
<PAGE> 10
STATEMENT OF INVESTMENTS (Unaudited) (Continued)
<TABLE>
<CAPTION>
MARKET VALUE
DATE STRIKE CONTRACTS SEE NOTE 1
===================================================================================================================================
<S> <C> <C> <C> <C>
PUT OPTIONS PURCHASED--0.2%
- -----------------------------------------------------------------------------------------------------------------------------------
French Franc Put Opt. 4/97 5.55(FRF) 72,250,000 $196,520
----------------------------------------------------------------------------------------------------------------------------
French Franc Put Opt. 4/97 5.673(FRF) 60,800,000 67,792
----------------------------------------------------------------------------------------------------------------------------
Italy (Republic of) Treasury Bonds, Buoni
del Tesoro Poliennali, 9.50%, 2/1/06 Put Opt. 7/97 99.96%(ITL) 1,842 1,290
----------------------------------------------------------------------------------------------------------------------------
Japanese Yen Put Opt. 4/97 122.38(JPY) 860,500,000 103,260
----------------------------------------------------------------------------------------------------------------------------
New Zealand Dollar Put Opt. 6/97 1.432(NZD) 1,289,000 14,836
----------------------------------------------------------------------------------------------------------------------------
New Zealand Dollar Put Opt. 6/97 1.44(NZD) 1,134,800 10,656
----------------------------------------------------------------------------------------------------------------------------
New Zealand Dollar Put Opt. 6/97 1.447(NZD) 6,200,000 46,996
-----------
Total Put Options Purchased (Cost $615,719) 441,350
</TABLE>
<TABLE>
<CAPTION>
FACE
AMOUNT(1)
===================================================================================================================================
<S> <C> <C>
REPURCHASE AGREEMENT--9.7%
- -----------------------------------------------------------------------------------------------------------------------------------
Repurchase agreement with Zion First National Bank, 6.25%, dated
3/31/97, to be repurchased at $18,903,281 on 4/1/97, collateralized by
U.S. Treasury Nts., 6.125%--7.25%, 5/15/98--8/15/04, with a value
of $19,299,698 (Cost $18,900,000) $ 18,900,000 18,900,000
- -----------------------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE (COST $199,286,447) 100.9% 197,263,723
- -----------------------------------------------------------------------------------------------------------------------------------
LIABILITIES IN EXCESS OF OTHER ASSETS (0.9) (1,807,465)
------------- -------------
NET ASSETS 100.0% $195,456,258
============= =============
</TABLE>
1. Face amount is reported in U.S. Dollars, except for those denoted in
the following currencies:
ARP --Argentine Peso JPY --Japanese Yen
AUD --Australian Dollar MXP --Mexican Peso
CAD --Canadian Dollar MYR --Malaysian Ringgit
DEM --German Deutsche Mark NZD --New Zealand Dollar
FIM --Finnish Markka PLZ --Polish Zloty
FRF --French Franc PTE --Portuguese Escudo
GBP --British Pound Sterling SKK --Slovakia Koruna
IDR --Indonesian Rupiah ZAR --South African Rand
ITL --Italian Lira
2. Represents the current interest rate for a variable rate security.
3. Interest or dividend is paid in kind.
10 Oppenheimer International Bond Fund
<PAGE> 11
- --------------------------------------------------------------------------------
4. A sufficient amount of securities has been designated to cover
outstanding written call and put options, as follows:
<TABLE>
<CAPTION>
CONTRACTS/FACE EXPIRATION EXERCISE PREMIUM MARKET VALUE
SUBJECT TO CALL/PUT DATE PRICE RECEIVED SEE NOTE 1
-------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Argentina (Republic of) Global Bonds,
11.375%, 5/12/97 Put Option $ 850,000 5/12/97 104.40% $ 25,500 $ 39,525
-------------------------------------------------------------------------------------------------------------------------
Australia (Commonwealth of) Bonds,
10%, 6/23/97 Put Option $ 580,000 6/23/97 111.966% 7,288 8,691
-------------------------------------------------------------------------------------------------------------------------
Banco Hipotecario Nacional (Argentina)
Medium-Term Nts., 10.625%, 8/7/06 Call Option $ 600,000 8/7/00 100.00% 5,520 30,000
-------------------------------------------------------------------------------------------------------------------------
British Pound Sterling Call Option 1,759,000 4/23/97 2.75(GBP) 13,533 25,183
-------------------------------------------------------------------------------------------------------------------------
British Pound Sterling Call Option 1,759,000 4/29/97 2.80(GBP) 12,756 10,556
-------------------------------------------------------------------------------------------------------------------------
British Pound Sterling Call Option 1,435,000 4/30/97 0.606(GBP) 15,068 15,068
-------------------------------------------------------------------------------------------------------------------------
Canadian Dollar Put Option 1,380,000 5/27/97 1.375(CAD) 4,015 7,783
-------------------------------------------------------------------------------------------------------------------------
German Deutsche Mark Call Option 8,050,000 4/22/97 1.654(DEM) 24,927 20,310
-------------------------------------------------------------------------------------------------------------------------
German Deutsche Mark Put Option 8,050,000 4/22/97 1.704(DEM) 37,033 13,403
-------------------------------------------------------------------------------------------------------------------------
Mexican Peso Call Option 6,400,000 4/8/97 8.153(MXP) 80,320 169,920
-------------------------------------------------------------------------------------------------------------------------
Mexican Peso Call Option 850,000 4/10/97 8.122(MXP) 8,968 18,020
-------------------------------------------------------------------------------------------------------------------------
Mexican Peso Call Option 985,000 4/28/97 8.015(MXP) 8,570 7,732
-------------------------------------------------------------------------------------------------------------------------
New Zealand Dollar Call Option 1,289,000 6/17/97 1.416(NZD) 9,345 4,524
-------------------------------------------------------------------------------------------------------------------------
New Zealand Dollar Call Option 1,134,800 6/17/97 1.421(NZD) 8,000 4,857
-------------------------------------------------------------------------------------------------------------------------
New Zealand Dollar Call Option 6,200,000 6/17/97 1.432(NZD) 46,500 37,324
-------- ---------
$307,343 $ 412,896
======== =========
</TABLE>
5. For zero coupon bonds, the interest rate shown is the effective yield
on the date of purchase.
6. Represents securities sold under Rule 144A, which are exempt from
registration under the Securities Act of 1933, as amended. These
securities have been determined to be liquid under guidelines established
by the Board of Trustees. These securities amount to $5,301,568 or 2.71%
of the Fund's net assets, at March 31, 1997.
7. A sufficient amount of securities has been designated to cover
outstanding forward foreign currency exchange contracts. See Note 5 of
Notes to Financial Statements.
8. Identifies issues considered to be illiquid or restricted--See Note 7
of Notes to Financial Statements.
9. Denotes a step bond: a zero coupon bond that converts to a fixed or
variable interest rate at a designated future date.
See accompanying Notes to Financial Statements.
11 Oppenheimer International Bond Fund
<PAGE> 12
STATEMENT OF ASSETS AND LIABILITIES March 31, 1997 (Unaudited)
<TABLE>
<S> <C>
===================================================================================================================================
ASSETS
Investments, at value (cost $199,286,447)--see accompanying statement $197,263,723
----------------------------------------------------------------------------------------------------------------------------
Cash 1,925,070
----------------------------------------------------------------------------------------------------------------------------
Unrealized appreciation on forward foreign currency
exchange contracts--Note 5 160,082
----------------------------------------------------------------------------------------------------------------------------
Receivables:
Investments sold 20,028,657
Interest and principal paydowns 3,771,615
Shares of beneficial interest sold 2,194,837
Closed forward foreign currency exchange contracts 403,393
----------------------------------------------------------------------------------------------------------------------------
Deferred organization costs--Note 1 9,815
----------------------------------------------------------------------------------------------------------------------------
Other 3,391
-------------
Total assets 225,760,583
===================================================================================================================================
LIABILITIES
Unrealized depreciation on forward foreign currency
exchange contracts--Note 5 223,830
----------------------------------------------------------------------------------------------------------------------------
Options written, at value (premiums received $307,343)--
see accompanying statement--Note 6 412,896
----------------------------------------------------------------------------------------------------------------------------
Payables and other liabilities:
Investments purchased (including $3,589,947 purchased on a when-issued basis)--Note 1 27,907,195
Shares of beneficial interest redeemed 854,007
Dividends 488,946
Closed forward foreign currency exchange contracts 211,424
Distribution and service plan fees 108,575
Other 97,452
------------
Total liabilities 30,304,325
===================================================================================================================================
NET ASSETS $195,456,258
============
===================================================================================================================================
COMPOSITION OF
NET ASSETS
Paid-in capital $193,502,420
----------------------------------------------------------------------------------------------------------------------------
Undistributed net investment income 62,384
----------------------------------------------------------------------------------------------------------------------------
Accumulated net realized gain on investments and
foreign currency transactions 4,159,796
----------------------------------------------------------------------------------------------------------------------------
Net unrealized depreciation on investments and translation of
assets and liabilities denominated in foreign currencies (2,268,342)
------------
Net assets $195,456,258
============
===================================================================================================================================
NET ASSET VALUE
PER SHARE
Class A Shares:
Net asset value and redemption price per share (based on net assets
of $89,478,901 and 16,310,948 shares of beneficial interest outstanding) $5.49
Maximum offering price per share (net asset value plus sales charge
of 4.75% of offering price) $5.76
----------------------------------------------------------------------------------------------------------------------------
Class B Shares:
Net asset value, redemption price and offering price per share (based on
net assets of $86,190,012 and 15,739,213 shares of beneficial interest outstanding) $5.48
----------------------------------------------------------------------------------------------------------------------------
Class C Shares:
Net asset value, redemption price and offering price per share (based on
net assets of $19,787,345 and 3,614,606 shares of beneficial interest outstanding) $5.47
</TABLE>
See accompanying Notes to Financial Statements.
12 Oppenheimer International Bond Fund
<PAGE> 13
STATEMENT OF OPERATIONS For the Six Months Ended March 31, 1997 (Unaudited)
<TABLE>
<S> <C>
===================================================================================================================================
INVESTMENT INCOME
Interest (net of foreign withholding taxes of $366) $8,567,889
----------------------------------------------------------------------------------------------------------------------------
Dividends 8,075
----------
Total income 8,575,964
===================================================================================================================================
EXPENSES
Management fees--Note 4 594,441
----------------------------------------------------------------------------------------------------------------------------
Distribution and service plan fees--Note 4:
Class A 89,612
Class B 341,618
Class C 76,647
----------------------------------------------------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees--Note 4 97,815
----------------------------------------------------------------------------------------------------------------------------
Shareholder reports 67,439
----------------------------------------------------------------------------------------------------------------------------
Registration and filing fees:
Class A 10,195
Class B 11,140
Class C 2,565
----------------------------------------------------------------------------------------------------------------------------
Custodian fees and expenses 22,016
----------------------------------------------------------------------------------------------------------------------------
Legal and auditing fees 6,255
----------------------------------------------------------------------------------------------------------------------------
Trustees' fees and expenses 1,308
----------
Other 8,545
----------
Total expenses 1,329,596
===================================================================================================================================
NET INVESTMENT INCOME 7,246,368
===================================================================================================================================
REALIZED AND UNREALIZED
GAIN (LOSS)
Net realized gain (loss) on:
Investments 7,590,820
Closing and expiration of options written--Note 6 (119,563)
Foreign currency transactions (3,293,124)
----------
Net realized gain 4,178,133
----------------------------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation on:
Investments (2,499,628)
Translation of assets and liabilities denominated in foreign currencies (1,696,015)
----------
Net change (4,195,643)
----------
Net realized and unrealized loss (17,510)
===================================================================================================================================
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $7,228,858
==========
</TABLE>
See accompanying Notes to Financial Statements.
13 Oppenheimer International Bond Fund
<PAGE> 14
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
MARCH 31, 1997 SEPTEMBER 30,
(UNAUDITED) 1996
===================================================================================================================================
<S> <C> <C>
OPERATIONS
Net investment income $ 7,246,368 $ 3,832,783
----------------------------------------------------------------------------------------------------------------------------
Net realized gain 4,178,133 1,549,896
----------------------------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation or depreciation (4,195,643) 1,839,250
------------- -------------
Net increase in net assets resulting from operations 7,228,858 7,221,929
===================================================================================================================================
DIVIDENDS AND
DISTRIBUTIONS TO
SHAREHOLDERS
Dividends from net investment income:
Class A (3,542,648) (1,931,780)
Class B (2,974,901) (1,609,969)
Class C (666,435) (360,475)
----------------------------------------------------------------------------------------------------------------------------
Distributions from net realized gain:
Class A (703,931) --
Class B (645,001) --
Class C (149,671) --
===================================================================================================================================
BENEFICIAL INTEREST
TRANSACTIONS
Net increase in net assets resulting from
beneficial interest transactions--Note 2:
Class A 37,947,033 46,551,563
Class B 41,687,255 40,565,844
Class C 9,657,828 9,758,157
===================================================================================================================================
NET ASSETS
Total increase 87,838,387 100,195,269
----------------------------------------------------------------------------------------------------------------------------
Beginning of period 107,617,871 7,422,602
------------- -------------
End of period (including undistributed net investment
income of $62,384 for 1997) $ 195,456,258 $ 107,617,871
============= =============
</TABLE>
See accompanying Notes to Financial Statements.
14 Oppenheimer International Bond Fund
<PAGE> 15
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
CLASS A CLASS B CLASS C
--------------------------- -------------------------- ---------------------------
SIX MONTHS SIX MONTHS SIX MONTHS
ENDED ENDED ENDED
MARCH 31, YEAR ENDED MARCH 31, YEAR ENDED MARCH 31, YEAR ENDED
1997 SEPT. 30, 1997 SEPT. 30, 1997 SEPT. 30,
(UNAUDITED) 1996 1995(1) (UNAUDITED) 1996 1995(1) (UNAUDITED) 1996 1995(1)
===============================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
PER SHARE OPERATING DATA:
Net asset value, beginning
of period $5.49 $5.10 $5.00 $5.48 $5.10 $5.00 $5.48 $5.09 $5.00
- -------------------------------------------------------------------------------------------------------------------------------
Income from investment
operations:
Net investment income .27 .52 .15 .24 .48 .14 .24 .48 .14
Net realized and unrealized
gain .04 .40 .10 .05 .39 .10 .04 .39 .09
----- ----- ----- ----- ----- ----- ----- ----- ----
Total income from
investment operations .31 .92 .25 .29 .87 .24 .28 .87 .23
- -------------------------------------------------------------------------------------------------------------------------------
Dividends and distributions
to shareholders:
Dividends from net
investment income (.26) (.53) (.15) (.24) (.49) (.14) (.24) (.48) (.14)
Distributions from
net realized gain (.05) -- -- (.05) -- -- (.05) -- --
----- ----- ----- ----- ----- ----- ----- ----- ----
Total dividends and
distributions to shareholders (.31) (.53) (.15) (.29) (.49) (.14) (.29) (.48) (.14)
- -------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $5.49 $5.49 $5.10 $5.48 $5.48 $5.10 $5.47 $5.48 $5.09
===== ===== ===== ===== ===== ===== ===== ===== =====
================================================================================================================================
TOTAL RETURN, AT NET ASSET
VALUE(2) 5.76% 18.82% 5.13% 5.38% 17.71% 4.92% 5.19% 17.92% 4.73%
================================================================================================================================
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period
(in thousands) $89,479 $52,128 $3,984 $86,190 $45,207 $3,238 $19,787 $10,282 $201
- --------------------------------------------------------------------------------------------------------------------------------
Average net assets
(in thousands) $75,372 $19,817 $2,566 $68,820 $17,891 $1,125 $15,442 $4,039 $97
- --------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income 9.58%(3) 9.60% 9.94%(3) 8.69%(3) 8.81% 9.20%(3) 8.66%(3) 8.76% 9.36%(3)
Expenses, before voluntary
reimbursement by the Manager 1.27%(3) 1.59% 1.59%(3) 2.03%(3) 2.36% 2.21%(3) 2.03%(3) 2.36% 2.26%(3)
Expenses, net of voluntary
reimbursement by the Manager N/A 1.49% 0.41%(3) N/A 2.26% 0.89%(3) N/A 2.25% 0.85%(3)
- --------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate(4) 163.0% 273.3% 122.0% 163.0% 273.3% 122.0% 163.0% 273.3% 122.0%
</TABLE>
1. For the period from June 15, 1995 (commencement of operations) to
September 30, 1995.
2. Assumes a hypothetical initial investment on the business day before
the first day of the fiscal period (or commencement of operations), with
all dividends and distributions reinvested in additional shares on the
reinvestment date, and redemption at the net asset value calculated on
the last business day of the fiscal period. Sales charges are not
reflected in the total returns. Total returns are not annualized for
periods of less than one full year.
3. Annualized.
4. The lesser of purchases or sales of portfolio securities for a
period, divided by the monthly average of the market value of portfolio
securities owned during the period. Securities with a maturity or
expiration date at the time of acquisition of one year or less are
excluded from the calculation. Purchases and sales of investment
securities (excluding short-term securities) for the period ended March
31, 1997 were $250,333,672 and $196,480,499, respectively.
See accompanying Notes to Financial Statements.
15 Oppenheimer International Bond Fund
<PAGE> 16
NOTES TO FINANCIAL STATEMENTS (Unaudited)
================================================================================
1. SIGNIFICANT
ACCOUNTING POLICIES
Oppenheimer International Bond Fund (the Fund) is a registered
investment company organized as a Massachusetts Business Trust with a
single series of the same name. The Fund is registered as a diversified,
open-end management investment company under the Investment Company Act
of 1940, as amended. The Fund's investment objective is to seek high
total return (which includes current income and capital appreciation in
the value of its shares) primarily from foreign debt securities. The
Fund's investment adviser is OppenheimerFunds, Inc. (the Manager). The
Fund offers Class A, Class B and Class C shares. Class B and Class C
shares may be subject to a contingent deferred sales charge. All classes
of shares have identical rights to earnings, assets and voting
privileges, except that each class has its own distribution and/or
service plan, expenses directly attributable to a particular class and
exclusive voting rights with respect to matters affecting a single
class. Class B shares will automatically convert to Class A shares six
years after the date of purchase. The following is a summary of
significant accounting policies consistently followed by the Fund.
-------------------------------------------------------------------------
INVESTMENT VALUATION. Portfolio securities are valued at the close of
the New York Stock Exchange on each trading day. Listed and unlisted
securities for which such information is regularly reported are valued
at the last sale price of the day or, in the absence of sales, at values
based on the closing bid or the last sale price on the prior trading
day. Long-term and short-term "non-money market" debt securities are
valued by a portfolio pricing service approved by the Board of Trustees.
Such securities which cannot be valued by the approved portfolio pricing
service are valued using dealer-supplied valuations provided the Manager
is satisfied that the firm rendering the quotes is reliable and that the
quotes reflect current market value, or are valued under consistently
applied procedures established by the Board of Trustees to determine
fair value in good faith. Short-term "money market type" debt securities
having a remaining maturity of 60 days or less are valued at cost (or
last determined market value) adjusted for amortization to maturity of
any premium or discount. Forward foreign currency exchange contracts are
valued based on the closing prices of the forward currency contract
rates in the London foreign exchange markets on a daily basis as
provided by a reliable bank or dealer. Options are valued based upon the
last sale price on the principal exchange on which the option is traded
or, in the absence of any transactions that day, the value is based upon
the last sale price on the prior trading date if it is within the spread
between the closing bid and asked prices. If the last sale price is
outside the spread, the closing bid is used.
-------------------------------------------------------------------------
SECURITIES PURCHASED ON A WHEN-ISSUED BASIS. Delivery and payment for
securities that have been purchased by the Fund on a forward commitment
or when-issued basis can take place a month or more after the
transaction date. During this period, such securities do not earn
interest, are subject to market fluctuation and may increase or decrease
in value prior to their delivery. The Fund maintains, in a segregated
account with its custodian, assets with a market value equal to the
amount of its purchase commitments. The purchase of securities on a
when-issued or forward commitment basis may increase the volatility of
the Fund's net asset value to the extent the Fund makes such purchases
while remaining substantially fully invested. As of March 31, 1997, the
Fund had entered into outstanding when-issued or forward commitments of
$3,589,947.
-------------------------------------------------------------------------
FOREIGN CURRENCY TRANSLATION. The accounting records of the Fund are
maintained in U.S. dollars. Prices of securities denominated in foreign
currencies are translated into U.S. dollars at the closing rates of
exchange. Amounts related to the purchase and sale of securities and
investment income are translated at the rates of exchange prevailing on
the respective dates of such transactions.
The effect of changes in foreign currency exchange rates on
investments is separately identified from the fluctuations arising from
changes in market values of securities held and reported with all other
foreign currency gains and losses in the Fund's Statement of Operations.
16 Oppenheimer International Bond Fund
<PAGE> 17
================================================================================
1. SIGNIFICANT
ACCOUNTING POLICIES
(CONTINUED)
REPURCHASE AGREEMENTS. The Fund requires the custodian to take
possession, to have legally segregated in the Federal Reserve Book Entry
System or to have segregated within the custodian's vault, all
securities held as collateral for repurchase agreements. The market
value of the underlying securities is required to be at least 102% of
the resale price at the time of purchase. If the seller of the agreement
defaults and the value of the collateral declines, or if the seller
enters into an insolvency proceeding, realization of the value of the
collateral by the Fund may be delayed or limited.
-------------------------------------------------------------------------
ALLOCATION OF INCOME, EXPENSES, AND GAINS AND LOSSES. Income, expenses
(other than those attributable to a specific class) and gains and losses
are allocated daily to each class of shares based upon the relative
proportion of net assets represented by such class. Operating expenses
directly attributable to a specific class are charged against the
operations of that class.
-------------------------------------------------------------------------
FEDERAL TAXES. The Fund intends to continue to comply with provisions of
the Internal Revenue Code applicable to regulated investment companies
and to distribute all of its taxable income, including any net realized
gain on investments not offset by loss carryovers, to shareholders.
Therefore, no federal income or excise tax provision is required.
-------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS. The Fund intends to declare dividends
separately for Class A, Class B and Class C shares from net investment
income each day the New York Stock Exchange is open for business and pay
such dividends monthly. Distributions from net realized gains on
investments, if any, will be declared at least once each year.
-------------------------------------------------------------------------
ORGANIZATION COSTS. The Manager advanced $14,488 for organization and
start-up costs of the Fund. Such expenses are being amortized over a
five-year period from the date operations commenced. In the event that
all or part of the Manager's initial investment in shares of the Fund is
withdrawn during the amortization period, the redemption proceeds will
be reduced to reimburse the Fund for any unamortized expenses, in the
same ratio as the number of shares redeemed bears to the number of
initial shares outstanding at the time of such redemption.
-------------------------------------------------------------------------
CLASSIFICATION OF DISTRIBUTIONS TO SHAREHOLDERS. Net investment income
(loss) and net realized gain (loss) may differ for financial statement
and tax purposes primarily because of the recognition of certain foreign
currency gains (losses) as ordinary income (loss) for tax purposes. The
character of the distributions made during the year from net investment
income or net realized gains may differ from their ultimate
characterization for federal income tax purposes. Also, due to timing of
dividend distributions, the fiscal year in which amounts are distributed
may differ from the year that the income or realized gain was recorded
by the Fund.
-------------------------------------------------------------------------
OTHER. Investment transactions are accounted for on the date the
investments are purchased or sold (trade date) and dividend income is
recorded on the ex-dividend date. Discount on securities purchased is
amortized over the life of the respective securities, in accordance with
federal income tax requirements. Realized gains and losses on
investments and options written and unrealized appreciation and
depreciation are determined on an identified cost basis, which is the
same basis used for federal income tax purposes. Interest on
payment-in-kind debt instruments is accrued as income at the coupon rate
and a market adjustment is made on the ex-date.
The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amounts of income and
expenses during the reporting period. Actual results could differ from
those estimates.
17 Oppenheimer International Bond Fund
<PAGE> 18
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
================================================================================
2. SHARES OF
BENEFICIAL INTEREST
The Fund has authorized an unlimited number of no par value shares of
beneficial interest of each class. Transactions in shares of beneficial
interest were as follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED MARCH 31, 1997 YEAR ENDED SEPTEMBER 30, 1996
----------------------------------- -------------------------------
SHARES AMOUNT SHARES AMOUNT
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A:
Sold 9,121,242 $ 50,778,648 9,721,751 $51,914,821
Dividends reinvested 549,356 3,058,522 246,015 1,320,886
Redeemed (2,854,218) (15,890,137) (1,254,497) (6,684,144)
----------- ------------ ----------- -----------
Net increase 6,816,380 $ 37,947,033 8,713,269 $46,551,563
=========== ============ =========== ===========
-------------------------------------------------------------------------------------------------------------
Class B:
Sold 9,245,029 $ 51,424,994 8,129,566 $43,322,204
Dividends reinvested 397,004 2,203,485 172,750 925,063
Redeemed (2,148,971) (11,941,224) (691,490) (3,681,423)
----------- ------------ ----------- -----------
Net increase 7,493,062 $ 41,687,255 7,610,826 $40,565,844
=========== ============ =========== ===========
-------------------------------------------------------------------------------------------------------------
Class C:
Sold 2,177,057 $ 12,100,765 1,915,475 $10,177,624
Dividends reinvested 100,485 557,985 35,740 192,431
Redeemed (539,018) (3,000,922) (114,564) (611,898)
----------- ------------ ----------- -----------
Net increase 1,738,524 $ 9,657,828 1,836,651 $ 9,758,157
=========== ============ =========== ===========
</TABLE>
================================================================================
3. UNREALIZED GAINS AND
LOSSES ON INVESTMENTS
At March 31, 1997, net unrealized depreciation on investments and
options written of $2,128,277 was composed of gross appreciation of
$1,483,300, and gross depreciation of $3,611,577.
================================================================================
4. MANAGEMENT FEES
AND OTHER TRANSACTIONS
WITH AFFILIATES
Management fees paid to the Manager were in accordance with the
investment advisory agreement with the Fund which provides for an annual
fee of 0.75% of the first $200 million of average net assets, 0.72% of
the next $200 million, 0.69% of the next $200 million, 0.66% of the next
$200 million, 0.60% of the next $200 million and 0.50% of net assets in
excess of $1 billion.
For the six months ended March 31, 1997, commissions (sales
charges paid by investors) on sales of Class A shares totaled $548,004,
of which $148,567 was retained by OppenheimerFunds Distributor, Inc.
(OFDI), a subsidiary of the Manager, as general distributor, and by an
affiliated broker/dealer. Sales charges advanced to broker/dealers by
OFDI on sales of the Fund's Class B and Class C shares totaled
$1,559,327 and $110,667, of which $40,690 and $1,277, respectively, was
paid to an affiliated broker/dealer. During the six months ended March
31, 1997, OFDI received contingent deferred sales charges of $84,115 and
$5,616, respectively, upon redemption of Class B and Class C shares as
reimbursement for sales commissions advanced by OFDI at the time of sale
of such shares.
OppenheimerFunds Services (OFS), a division of the Manager, is
the transfer and shareholder servicing agent for the Fund, and for other
registered investment companies. OFS's total costs of providing such
services are allocated ratably to these companies.
The Fund has adopted a Service Plan for Class A shares to
reimburse OFDI for a portion of its costs incurred in connection with
the personal service and maintenance of accounts that hold Class A
shares. Reimbursement is made quarterly at an annual rate that may not
exceed 0.25% of the average annual net assets of Class A shares of the
Fund. OFDI uses the service fee to reimburse brokers, dealers, banks and
other financial institutions quarterly for providing personal service
and maintenance of accounts of their customers that hold Class A shares.
During the six months ended March 31, 1997, OFDI paid $4,017 to an
affiliated broker/dealer as reimbursement for Class A personal service
and maintenance expenses.
18 Oppenheimer International Bond Fund
<PAGE> 19
================================================================================
4. MANAGEMENT FEES
AND OTHER TRANSACTIONS
WITH AFFILIATES
(CONTINUED)
The Fund has adopted compensation type Distribution and Service Plans
for Class B and Class C shares to compensate OFDI for its services and
costs in distributing Class B and Class C shares and servicing accounts.
Under the Plans, the Fund pays OFDI an annual asset-based sales charge
of 0.75% per year on Class B shares and Class C shares, as compensation
for sales commissions paid from its own resources at the time of sale
and associated financing costs. OFDI also receives a service fee of
0.25% per year as compensation for costs incurred in connection with the
personal service and maintenance of accounts that hold shares of the
Fund, including amounts paid to brokers, dealers, banks and other
financial institutions. Both fees are computed on the average annual net
assets of Class B and Class C shares, determined as of the close of each
regular business day. During the six months ended March 31, 1997, OFDI
retained $314,069 and $61,818, respectively, as compensation for Class B
and Class C sales commissions and service fee advances, as well as
financing costs. If the Plans are terminated by the Fund, the Board of
Trustees may allow the Fund to continue payments of the asset-based
sales charge to OFDI for certain expenses it incurred before the Plans
were terminated. At March 31, 1997, OFDI had incurred unreimbursed
expenses of $2,880,260 for Class B and $263,805 for Class C.
================================================================================
5. FORWARD CONTRACTS
A forward foreign currency exchange contract (forward contract) is a
commitment to purchase or sell a foreign currency at a future date, at a
negotiated rate.
The Fund uses forward contracts to seek to manage foreign
currency risks. They may also be used to tactically shift portfolio
currency risk. The Fund generally enters into forward contracts as a
hedge upon the purchase or sale of a security denominated in a foreign
currency. In addition, the Fund may enter into such contracts as a hedge
against changes in foreign currency exchange rates on portfolio
positions.
Forward contracts are valued based on the closing prices of the
forward currency contract rates in the London foreign exchange markets
on a daily basis as provided by a reliable bank or dealer. The Fund will
realize a gain or loss upon the closing or settlement of the forward
transaction.
Securities held in designated accounts to cover net exposure on
outstanding forward contracts are noted in the Statement of Investments
where applicable. Unrealized appreciation or depreciation on forward
contracts is reported in the Statement of Assets and Liabilities.
Realized gains and losses are reported with all other foreign currency
gains and losses in the Fund's Statement of Operations.
Risks include the potential inability of the counterparty to meet
the terms of the contract and unanticipated movements in the value of a
foreign currency relative to the U.S. Dollar.
At March 31, 1997, the Fund had outstanding forward contracts to
purchase and sell foreign currencies as follows:
<TABLE>
<CAPTION>
CONTRACT AMOUNT VALUATION AS OF UNREALIZED UNREALIZED
CONTRACTS TO PURCHASE EXPIRATION DATE (000s) MARCH 31, 1997 APPRECIATION DEPRECIATION
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Finnish Markka (FIM) 4/1/97--4/2/97 26,320 FIM $ 5,314,140 $ 92,969 $ --
Italian Lira (ITL) 4/1/97 3,596,770 ITL 2,156,013 28,440 --
Portuguese Escudo (PTE) 9/12/97 398,974 PTE 2,376,191 38,673 --
------------- ---------- --------
$ 9,846,344 160,082 --
============= ---------- --------
<CAPTION>
CONTRACTS TO SELL
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Danish Krone (DKK) 4/1/97--4/2/97 33,519 DKK $ 5,273,686 $ -- $ 71,768
Swiss Franc (CHF) 6/24/97--10/29/97 11,615 CHF 8,200,531 -- 152,062
------------- ---------- --------
$ 13,474,217 -- 223,830
============= ---------- --------
Total Unrealized Appreciation and Depreciation $ 160,082 $223,830
========== ========
</TABLE>
19 Oppenheimer International Bond Fund
<PAGE> 20
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)
================================================================================
6. OPTION ACTIVITY
The Fund may buy and sell put and call options, or write put and covered
call options on portfolio securities in order to produce incremental
earnings or protect against changes in the value of portfolio
securities.
The Fund generally purchases put options or writes covered call
options to hedge against adverse movements in the value of portfolio
holdings. When an option is written, the Fund receives a premium and
becomes obligated to sell or purchase the underlying security at a fixed
price, upon exercise of the option.
Options are valued daily based upon the last sale price on the
principal exchange on which the option is traded and unrealized
appreciation or depreciation is recorded. The Fund will realize a gain
or loss upon the expiration or closing of the option transaction. When
an option is exercised, the proceeds on sales for a written call option,
the purchase cost for a written put option, or the cost of the security
for a purchased put or call option is adjusted by the amount of premium
received or paid.
Securities designated to cover outstanding call options are noted
in the Statement of Investments where applicable. Shares subject to
call, expiration date, exercise price, premium received and market value
are detailed in a footnote to the Statement of Investments. Options
written are reported as a liability in the Statement of Assets and
Liabilities. Gains and losses are reported in the Statement of
Operations.
The risk in writing a call option is that the Fund gives up the
opportunity for profit if the market price of the security increases and
the option is exercised. The risk in writing a put option is that the
Fund may incur a loss if the market price of the security decreases and
the option is exercised. The risk in buying an option is that the Fund
pays a premium whether or not the option is exercised. The Fund also has
the additional risk of not being able to enter into a closing
transaction if a liquid secondary market does not exist.
Written option activity for the six months ended March 31, 1997 was as
follows:
<TABLE>
<CAPTION>
CALL OPTIONS PUT OPTIONS
-------------------------------- ----------------------------
NUMBER OF AMOUNT OF NUMBER OF AMOUNT OF
OPTIONS PREMIUMS OPTIONS PREMIUMS
-----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Options outstanding at September 30, 1996 10,900 $ 72,820 -- $ --
Options written 64,142,417 566,768 26,469,306 179,997
Options closed or expired (27,977,067) (337,969) (937,500) (10,922)
Options exercised (6,313,850) (68,113) (16,100,376) (95,238)
----------- ---------- ----------- --------
Options outstanding at March 31, 1997 29,862,400 $ 233,506 9,431,430 $ 73,837
=========== ========== =========== ========
</TABLE>
================================================================================
7. ILLIQUID AND RESTRICTED
SECURITIES
At March 31, 1997, investments in securities included issues that are
illiquid or restricted. Restricted securities are often purchased in
private placement transactions, are not registered under the Securities
Act of 1933, may have contractual restrictions on resale, and are valued
under methods approved by the Board of Trustees as reflecting fair
value. A security may be considered illiquid if it lacks a
readily-available market or if its valuation has not changed for a
certain period of time. The Fund intends to invest no more than 10% of
its net assets (determined at the time of purchase and reviewed from
time to time) in illiquid or restricted securities. Certain restricted
securities, eligible for resale to qualified institutional investors,
are not subject to that limit. The aggregate value of illiquid or
restricted securities subject to this limitation at March 31, 1997 was
$12,751,594, which represents 6.52% of the Fund's net assets.
20 Oppenheimer International Bond Fund
<PAGE> 21
OPPENHEIMER INTERNATIONAL BOND FUND
A Series of Oppenheimer International Bond Fund
================================================================================
OFFICERS AND TRUSTEES
James C. Swain, Chairman and Chief Executive Officer
Bridget A. Macaskill, Trustee and President
Robert G. Avis, Trustee
William A. Baker, Trustee
Charles Conrad, Jr., Trustee
Jon S. Fossel, Trustee
Sam Freedman, Trustee
Raymond J. Kalinowski, Trustee
C. Howard Kast, Trustee
Robert M. Kirchner, Trustee
Ned M. Steel, Trustee
George C. Bowen, Vice President, Treasurer and Assistant Secretary
Andrew J. Donohue, Vice President and Secretary
Ashwin Vasan, Vice President
Robert J. Bishop, Assistant Treasurer
Scott T. Farrar, Assistant Treasurer
Robert G. Zack, Assistant Secretary
================================================================================
INVESTMENT ADVISER
OppenheimerFunds, Inc.
================================================================================
DISTRIBUTOR
OppenheimerFunds Distributor, Inc.
================================================================================
TRANSFER AND SHAREHOLDER
SERVICING AGENT
OppenheimerFunds Services
================================================================================
CUSTODIAN OF
PORTFOLIO SECURITIES
The Bank of New York
================================================================================
INDEPENDENT AUDITORS
Deloitte & Touche LLP
================================================================================
LEGAL COUNSEL
Myer, Swanson, Adams & Wolf, P.C.
The financial statements included herein have been taken from the
records of the Fund without examination by the independent auditors.
This is a copy of a report to shareholders of Oppenheimer International
Bond Fund. This report must be preceded or accompanied by a Prospectus
of Oppenheimer International Bond Fund. For material information
concerning the Fund, see the Prospectus.
Shares of Oppenheimer funds are not deposits or obligations of any bank,
are not guaranteed by any bank, are not insured by the FDIC or any other
agency, and involve investment risks, including possible loss of the
principal amount invested.
21 Oppenheimer International Bond Fund
<PAGE> 22
OPPENHEIMERFUNDS FAMILY
================================================================================
OppenheimerFunds offers over 50 funds designed to fit virtually every
investment goal. Whether you're investing for retirement, your
children's education or tax-free income, we have the funds to help you
seek your objective.
When you invest with OppenheimerFunds, you can feel comfortable
knowing that you are investing with a respected financial institution
with over 35 years of experience in helping people just like you reach
their financial goals. And you're investing with a leader in global,
growth stock and flexible fixed-income investments--with over 3 million
shareholder accounts and more than $60 billion under OppenheimerFunds'
management and that of our affiliates.
At OppenheimerFunds we don't charge a fee to exchange shares. And
you can exchange shares easily by mail or by telephone.(1) For more
information on Oppenheimer funds, please contact your financial adviser
or call us at 1-800-525-7048 for a prospectus. You may also write us at
the address shown on the back cover. As always, please read the
prospectus carefully before you invest.
<TABLE>
<S> <C> <C>
===========================================================================================================
REAL ASSET FUNDS Real Asset Fund Gold & Special Minerals Fund
===========================================================================================================
STOCK FUNDS Developing Markets Fund Growth Fund
Global Emerging Growth Fund Global Fund
Enterprise Fund(2) Quest Global Value Fund
International Growth Fund Disciplined Value Fund
Discovery Fund Oppenheimer Fund
Quest Small Cap Value Fund Value Stock Fund
Capital Appreciation Fund(3) Quest Value Fund
Quest Capital Value Fund
===========================================================================================================
STOCK & BOND FUNDS Main Street Income & Growth Fund Equity Income Fund
Quest Opportunity Value Fund Disciplined Allocation Fund
Total Return Fund Multiple Strategies Fund(4)
Quest Growth & Income Value Fund Strategic Income & Growth Fund
Global Growth & Income Fund Bond Fund for Growth
===========================================================================================================
BOND FUNDS International Bond Fund Bond Fund
High Yield Fund U.S. Government Trust
Champion Income Fund Limited-Term Government Fund
Strategic Income Fund
============================================================================================================
MUNICIPAL FUNDS California Municipal Fund(5) Insured Municipal Fund
Florida Municipal Fund(5) Intermediate Municipal Fund
New Jersey Municipal Fund(5)
New York Municipal Fund(5) Rochester Division
Pennsylvania Municipal Fund(5) Rochester Fund Municipals
Municipal Bond Fund Limited Term New York Municipal Fund
============================================================================================================
MONEY MARKET FUNDS(6) Money Market Fund Cash Reserves
============================================================================================================
LIFESPAN Growth Fund Income Fund
Balanced Fund
</TABLE>
1. Exchange privileges are subject to change or termination. Shares may
be exchanged only for shares of the same class of eligible funds.
2. Effective 4/1/96, the Fund is closed to new investors.
3. On 12/18/96, the Fund's name was changed from "Target Fund."
4. On 3/6/97, the Fund's name was changed from "Asset Allocation Fund."
5. Available only to investors in certain states.
6. An investment in money market funds is neither insured nor guaranteed
by the U.S. government and there can be no assurance that a money market
fund will be able to maintain a stable net asset value of $1.00 per
share. Oppenheimer funds are distributed by OppenheimerFunds
Distributor, Inc., Two World Trade Center, New York, NY 10048-0203.
(C) Copyright 1997 OppenheimerFunds, Inc. All rights reserved.
22 Oppenheimer International Bond Fund
<PAGE> 23
INFORMATION
GENERAL INFORMATION
Monday-Friday 8:30 a.m.-9 p.m. ET
Saturday 10 a.m.-2 p.m. ET
1-800-525-7048
TELEPHONE TRANSACTIONS
Monday-Friday 8:30 a.m.-8 p.m. ET
1-800-852-8457
PHONELINK
24 hours a day, automated
information and transactions
1-800-533-3310
TELECOMMUNICATIONS DEVICE
FOR THE DEAF (TDD)
Monday-Friday 8:30 a.m.-8 p.m. ET
1-800-843-4461
OPPENHEIMERFUNDS
INFORMATION HOTLINE
24 hours a day, timely and insightful
messages on the economy and
issues that affect your investments
1-800-835-3104
RS0880.001.0397 May 31, 1997
[PHOTO]
CUSTOMER SERVICE REPRESENTATIVE
OPPENHEIMERFUNDS SERVICES
"HOW MAY I HELP YOU?"
As an Oppenheimer fund shareholder, you have some special privileges. Whether
it's automatic investment plans, informative newsletters and hotlines, or ready
account access, you can benefit from services designed to make investing
simple.
And when you need help, our Customer Service Representatives are only a
toll-free phone call away. They can provide information about your account and
handle administrative requests. You can reach them at our General Information
number.
When you want to make a transaction, you can do it easily by calling our
toll-free Telephone Transactions number. And, by enrolling in AccountLink, a
convenient service that "links" your Oppenheimer funds accounts and your bank
checking or savings account, you can use the Telephone Transactions number to
make investments.
For added convenience, you can get automated information with
OppenheimerFunds PhoneLink service, available 24 hours a day, 7 days a week.
PhoneLink gives you access to a variety of fund, account, and market
information. Of course, you can always speak with a Customer Service
Representative during the General Information hours shown at the left.
You can count on us whenever you need assistance. That's why the
International Customer Service Association, an independent, nonprofit
organization made up of over 3,200 customer service management professionals
from around the country, honored the Oppenheimer funds' transfer agent,
OppenheimerFunds Services, with their Award of Excellence in 1993.
So call us today--we're here to help.
- -------------------------------------------------------------------------------
[OPPENHEIMERFUNDS LOGO]
OppenheimerFunds Distributor, Inc.
P.O. Box 5270
Denver, CO 80217-5270
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