SMITH BARNEY INSTITUTIONAL CASH MANAGEMENT FUND, INC. (the "Fund")
CLASS A SHARES
CLASS B SHARES
Supplement dated July 28, 1997 to Prospectuses dated September 27,
1996
The following supplements and, to the extent inconsistent
therewith, supersedes the information contained in the Prospectus
of each of the Class A shares and Class B shares of the Fund (each
a "Prospectus") under the section "Purchase of Shares":
The minimum initial investment in each Portfolio is
$1,000,000. The minimum subsequent investment is $50.
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The information contained in the Prospectus under the section
"Redemption of Shares" is replaced in its entirety as follows:
Redemption of Shares. Shareholders may redeem their
shares without charge on any day the Fund calculates its net
asset value. See "Valuation of Shares." Redemption
requests received in proper form prior to 2:00 p.m. (12:00
noon in the case of the Municipal Portfolio), New York time,
are priced at the net asset value as next determined.
Redemption requests received after 2:00 p.m. (12:00 noon in
the case of the Municipal Portfolio), New York time, will
not be accepted and a new redemption request should be
submitted on the following day that the Fund calculates its
net asset value. Redemption requests must be made through
Smith Barney Inc. ("Smith Barney"), a broker that clears
securities transactions on a fully disclosed basis (an
"Introducing Broker") or the securities dealer in the
selling group through whom the shares were purchased, except
that shareholders who purchased shares of the Fund from
First Data Investor Services Group, Inc. ("First Data") may
also redeem shares directly through First Data. A
shareholder desiring to redeem shares represented by
certificates also must present the certificates to Smith
Barney, the Introducing Broker or First Data endorsed for
transfer (or accompanied by an endorsed stock power), signed
exactly as the shares are registered. Redemption requests
involving shares represented by certificates will not be
deemed received until certificates are received by First
Data in proper form.
Shares held at Smith Barney. A redemption request
received by Smith Barney in proper form before 2:00 p.m.
(12:00 noon in the case of the Municipal Portfolio) will not
earn a dividend on the day the request is received and
redemption proceeds will be credited to a shareholder's
account on the same day.
Shares held at First Data. A shareholder who
purchased shares of the Fund directly through First Data may
redeem shares through First Data in the manner described in
the Prospectus under "Expedited Redemption Procedures" and
"Ordinary Redemption Procedures".
___________________________________________________________
The following supplements and, to the extent inconsistent
therewith, supersedes the information contained in each Prospectus
of the Fund under the section "Investment Objectives and Policies
- - The Cash Portfolio - Obligations of Financial Institutions":
The Cash Portfolio may purchase fixed time deposits
maturing in less than one year, provided, however,
that fixed time deposits maturing in more than seven
calendar days shall be considered illiquid securities.
____________________________________________________________
The following replaces in its entirety the section of each
Prospectus entitled "Investment Objectives and Policies - The
Municipal Portfolio - Tender Option Bonds":
Derivative Products - The Municipal Portfolio
may invest up to 20% of the value of its assets in one
or more of the three principal types of derivative
product structures described below. Derivative
products are typically structured by a bank, broker-
dealer or other financial institution. A derivative
product generally consists of a trust or partnership
through which the Portfolio holds an interest in one
or more underlying bonds coupled with a conditional
right to sell ("put") the Portfolio's interest in the
underlying bonds at par plus accrued interest to a
financial institution (a "Liquidity Provider").
Typically, a derivative product is structured as a
trust or partnership which provides for pass-through
tax-exempt income. There are currently three
principal types of derivative structures: (1) "Tender
Option Bonds", which are instruments which grant the
holder thereof the right to put an underlying bond at
par plus accrued interest at specified intervals to a
Liquidity Provider; (2) "Swap Products", in which the
trust or partnership swaps the payments due on an
underlying bond with a swap counterparty who agrees to
pay a floating municipal money market interest rate;
and (3) "Partnerships", which allocate to the partners
income, expenses, capital gains and losses in
accordance with a governing partnership agreement.
Investments in derivative products raise certain
tax, legal, regulatory and accounting issues which may
not be presented by investments in other municipal
obligations. There is some risk that certain issues
could be resolved in a manner which could adversely
impact the performance of the Portfolio. For example,
the tax-exempt treatment of the interest paid to
holders of derivative products is premised on the
legal conclusion that the holders of such derivative
products have an ownership interest in the underlying
bonds. While the Portfolio receives an opinion of
legal counsel to the effect that the income from each
derivative product is tax-exempt to the same extent as
the underlying bond, the Internal Revenue Service (the
"IRS") has not issued a ruling on this subject. Were
the IRS to issue an adverse ruling, there is a risk
that the interest paid on such derivative products
would be deemed taxable.
The Portfolio intends to limit the risk of
derivative products by purchasing only those
derivative products that are consistent with the
Portfolio's investment objective and policies. The
Portfolio will not use such instruments to leverage
securities. Hence, derivative products' contributions
to the overall market risk characteristics of a
Portfolio will not materially alter its risk profile
and will be fully consistent with the Portfolio's
maturity guidelines.
FD 01316
