-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, PCkmE4Hwj1ztBMb/Mbme5LMwcyTAxU5BtiOi8lSOaFc9RaQHK1wxj2PwwW5BYxFY nTTUnOnd8aapgQNN6008Rg== 0000013075-96-000012.txt : 19960906 0000013075-96-000012.hdr.sgml : 19960906 ACCESSION NUMBER: 0000013075-96-000012 CONFORMED SUBMISSION TYPE: N-30D CONFIRMING COPY: PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19960630 FILED AS OF DATE: 19960905 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: BOND FUND OF AMERICA INC CENTRAL INDEX KEY: 0000013075 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] IRS NUMBER: 952884967 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-02444 FILM NUMBER: 00000000 BUSINESS ADDRESS: STREET 1: 333 S HOPE ST - 52ND FLOOR CITY: LOS ANGELES STATE: CA ZIP: 90071 BUSINESS PHONE: 2134869200 N-30D 1 THE BOND FUND OF AMERICA SEMI-ANNUAL REPORT For the six months ended June 30, 1996 [The American Funds Group(R)] THE BOND FUND OF AMERICA(SM) Seeks as high a level of current income as is consistent with preservation of capital through a diversified portfolio of bonds and other fixed-income obligations. Fund results in this report were computed without a sales charge unless otherwise indicated. Here are the total returns and average annual compound returns with all distributions reinvested for periods ended June 30, 1996, assuming payment of the 4.75% maximum sales charge at the beginning of the stated periods - 10 years: +122.33%, or +8.32% a year; 5 years: +52.32%, or +8.78% a year; 12 months: +2.33%. The fund's 30-day yield as of July 31, 1996, calculated in accordance with the Securities and Exchange Commission formula, was 7.03%. THE FIGURES IN THIS REPORT REFLECT PAST RESULTS. SHARE PRICE AND RETURN WILL VARY, SO YOU MAY LOSE MONEY BY INVESTING IN THE FUND. THE SHORTER THE TIME PERIOD OF YOUR INVESTMENT, THE GREATER THE POSSIBILITY OF LOSS. FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR INSURED OR GUARANTEED BY, THE U.S. GOVERNMENT, ANY FINANCIAL INSTITUTION, THE FEDERAL DEPOSIT INSURANCE CORPORATION, OR ANY OTHER AGENCY, ENTITY OR PERSON. FELLOW SHAREHOLDERS: Interest rates continued to demonstrate their cyclical nature in the first half of our fiscal year. Longer term interest rates rose over the period. Bond prices, which move inversely to interest rates, moved lower. However, the decline in The Bond Fund of America's share value was fully offset by the income you received from the fund. If, like most shareholders, you reinvested the 47 1/2 cents a share in dividends paid during the six months ended June 30, your holdings rose 0.5% in value. [Sidebar] The Bond Fund of America provided shareholders with good relative stability. [End Sidebar] By comparison, the Salomon Brothers Broad Investment-Grade (BIG) Bond Index and the Lehman Brothers Aggregate Bond Index declined 1.3% and 1.2%, respectively, on a reinvested basis (the indexes are unmanaged and have no expenses). The 119 comparable corporate bond funds tracked by Lipper Analytical Services declined 2.3% on average, also with dividends reinvested. The Bond Fund of America's small advance brings the fund's total return over the past 12 months to +7.4% and its lifetime total return (since May 28, 1974) to +793.0%, an average compound return of +10.4% a year. During the past six months, bond yields rose following reports that economic activity was growing at a faster pace than many investors had anticipated. In particular, reports of a significant pickup in the rate of job creation last spring dashed hopes of further cuts in short-term interest rates by the Federal Reserve Board and led many market observers to factor in the possibility of rate increases. At midyear, 42% of the fund's assets were invested in corporate bonds. A similar amount was held in a combination of U.S. Treasury and mortgage-related securities. With strong business activity producing improvements in corporate profits and balance sheets, the market prices of many of the corporate bond issues in the portfolio held up better than the market as a whole. Our mortgage- and asset-backed securities, which generally have relatively short effective maturities, also added to the fund's stable results. We would like to emphasize, as we did in our annual report, our dedication to research in making investment decisions on your behalf. This includes research into the global economic outlook, ongoing developments in individual sectors of the bond market, along with analysis of the creditworthiness of specific issuers and the characteristics of individual issues. Crosscurrents will, no doubt, continue to sweep the financial markets. We encourage you to maintain a long-term perspective. And we look forward to providing you with more detail on your portfolio in our annual report six months hence. Cordially, Paul G. Haaga, Jr. Chairman of the Board Abner D. Goldstine President August 15, 1996 THE BOND FUND OF AMERICA Principal Market Percent of INVESTMENT PORTFOLIO JUNE 30, 1996 Amount Value Net Assets (000) (000) ELECTRICAL & GAS UTILITIES Utilities: Electrical & Gas Big Rivers Electric Corp. 10.70% 2017 $17,000 $18,686 .29% CEZ Finance BV 8.875% 1999 /1/ 7,000 7,437 .12 CMS Energy 0%/9.50% 1997 /2/ 2,000 2,030 .03 Columbia Gas System, Inc.: Series A 6.39% 2000 10,000 9,797 Series C 6.80% 2005 7,000 6,697 1.05 Series F 7.42% 2015 35,000 32,628 Series G 7.62% 2025 20,500 19,273 El Paso Electric Co. Series D, 8.90% 2006 2,500 2,456 .04 Long Island Lighting Co.: 8.90% 2019 5,000 4,537 .24 8.20% 2023 12,500 10,978 United Illuminating Co. 9.76% 2006 5,044 5,253 .08 -------------- ---------- 119,772 1.85 -------------- ---------- INDUSTRIAL & SERVICE Appliances & Household Goods Knoll Group, Inc. 10.875% 2006 4,000 4,100 .06 -------------- ---------- Automobiles Exide Corp. 10.00% 2005 1,000 976 .02 General Motors Corp.: 9.45% 2011 20,000 22,984 8.80% 2021 52,000 58,276 1.25 -------------- ---------- 82,236 1.27 -------------- ---------- Beverages & Tobacco Canandaigua Wine Co., Inc. 8.75% 2003 3,000 2,940 .04 Dr Pepper Bottling Co. of Texas 10.25% 2000 7,500 7,650 .12 -------------- ---------- 10,590 .16 -------------- ---------- Broadcasting & Publishing American Media Operations, Inc. 11.625% 2004 11,500 11,730 .18 Chancellor Broadcasting Co.: 9.375% 2004 12,500 11,812 .21 12.50% 2004 2,000 2,200 EZ Communications, Inc. 9.75% 2005 250 239 .00 Grupo Televisa, S.A. : 11.375% 2003 5,000 5,075 .16 0%/13.25% 2008 /2/ 9,250 4,995 Infinity Broadcasting Corp. 10.375% 2002 4,500 4,793 .08 Marvel Holdings Inc. 0% 1998 18,750 15,000 .23 Newsquest Capital PLC 11.00% 2006 4,750 4,726 .07 Univision Televistion Group, Inc. 11.75% 2001 5,500 5,858 .09 Young Broadcasting Inc. 10.125% 2005 3,500 3,343 .05 -------------- ---------- 69,771 1.07 -------------- ---------- Construction & Housing Del Webb Corp. 9.75% 2003 10,000 9,500 .15 Kaufman and Broad Home Corp. 10.375% 1999 7,500 7,688 .12 M.D.C. Holdings, Inc. 11.125% 2003 14,000 13,370 .20 -------------- ---------- 30,558 .47 -------------- ---------- Data Processing & Reproductions Apple Computer, Inc. 6.50% 2004 19,000 15,675 .24 AST Research, Inc. convertable notes 0% 2013 31,500 10,080 .16 Data General Corp.: 7.75% convertible debentures 2001 7,000 6,860 .13 8.375% 2002 1,250 1,169 Maxtor Corp. 5.75% convertible debentures 2012 2,000 1,380 .02 Neodata Services, Inc. 0%/12.00% 2003 /2/ 12,000 12,000 .18 Unisys Corp. 10.625% 1999 2,500 2,500 .04 -------------- ---------- 49,664 .77 -------------- ---------- Diversified Media & Cable Television Bell Cablemedia PLC 0%/11.95% 2004 /2/ 42,500 29,856 .46 Cablevision Industries Corp.: 10.75% 2004 1,000 1,030 .09 9.875% 2013 5,000 4,637 Century Communications Corp.: 9.50% 2000 3,500 3,482 .12 9.75% 2002 4,550 4,527 Comcast Corp.: 10.25% 2001 13,000 13,553 9.375% 2005 3,000 2,887 .45 1.125% convertible debentures 2007 25,000 12,125 Comcast UK Cable Partners Ltd. 0%/11.20% 2007 /2/ 25,000 14,750 .23 Continental Cablevision, Inc.: 8.50% 2001 22,050 23,085 10.625% 2002 1,500 1,605 8.625% 2003 4,000 4,217 8.875% 2005 10,000 10,698 .84 11.00% 2007 3,000 3,368 9.00% 2008 7,000 7,608 9.50% 2013 3,000 3,240 Heartland Wireless Communications, Inc. Units, 13.00% 2003 4,024 4,500 .07 Insight Communications Co.,LP 8.25% 2000 /4/ 11,250 11,138 .17 International CableTel Inc.: 0%/10.875% 2003 /2/ 9,500 6,911 .28 0%/12.75% 2005 /2/ 17,750 11,227 Multicanal Participacoes SA 12.625% 2004 9,250 9,574 .15 News America Holdings Inc.: 10.125% 2012 26,000 29,237 8.625% 2014 A$3,250 2,140 .64 8.45% 2034 $10,000 10,613 People's Choice TV Corp. Units, 0%/13.125% 2004 /2/ 1,000 568 .01 Rogers Communications Inc.: 10.875% 2004 3,500 3,561 .20 0% convertible debentures 2004 25,000 9,125 Storer Communications, Inc. 10.00% 2003 11,087 10,976 .17 TCI Communications, Inc. 8.75% 2015 10,000 9,829 .15 Tele-Communications, Inc. 9.25% 2023 7,500 7,393 .11 Tele West PLC: 9.625% 2006 4,700 4,594 .22 0%/11.00% 2007 /2/ 16,000 9,440 Time Warner Entertainment Co., LP.: 9.625% 2002 15,000 16,531 .56 10.15% 2012 17,500 20,157 Time Warner Inc.: 0% convertible debentures 2013 57,500 24,006 .77 9.125% 2013 25,000 26,110 TKR Cable I, Inc. 10.50% 2007 27,500 30,147 .46 Turner Broadcasting System, Inc. 0% convertible debentures 15,000 7,088 .11 U S WEST, Inc. 0% convertible debentures 2011 70,000 24,588 .38 Vanguard Cellular Systems, Inc. 9.375% 2006 6,000 5,805 .09 Viacom International Inc.: 9.125% 1999 5,000 5,100 .18 10.25% 2001 6,100 6,527 Videotron Holdings PLC 0%/11.125% 2004 /2/ 20,500 15,068 .23 -------------- ---------- 462,621 7.14 -------------- ---------- Electrical & Electronics General Electric Co. 8.625% 2008 3,000 3,333 .05 MagneTek, Inc. 10.75% 1998 7,500 7,350 .11 Phillips Electronics NV 7.20% 2026 5,500 5,466 .08 Samsung Electronics Co., Ltd. 8.50% 2002 /1/ 4,000 4,200 .07 VLSI Technology, Inc. 8.25% convertible debentures 2005 4,000 3,550 .06 -------------- ---------- 23,899 .37 -------------- ---------- Energy & Related Companies BP America Inc. 10.00% 2018 4,000 4,394 .07 Benton Oil and Gas Co. 11.625% 2003 /1/ 4,000 4,120 .06 California Energy Co., Inc.: 9.875% 2003 14,000 14,280 .81 0%/10.25% 2004 /2/ 39,600 38,016 Chesapeake Energy Corp. 9.125% 2006 4,000 3,900 .06 Cliffs Drilling Co. 10.25% 2003 15,750 15,592 .24 Falcon Drilling Co., Inc.: 9.75% 2001 2,500 2,550 .12 8.875% 2003 5,750 5,549 Flores & Rucks, Inc. 13.50% 2004 4,300 4,967 .08 Global Marine, Inc. 12.75% 1999 4,250 4,601 .07 McDermott Inc. 9.375% 2002 3,000 3,226 .05 Mesa Capital Corp. 12.75% 1998 6,500 6,565 .10 Mesa Operating Co. 10.625% 2006 1,000 1,015 .01 Midland Cogeneration Venture LP: 10.33% 2002 7,726 8,141 .21 secured lease obligation bonds, 10.33% 2002 5,555 5,853 Mobil Corp. 8.00% 2032 10,000 10,130 .16 Occidental Petroleum Corp. 9.25% 2019 12,000 14,007 .22 Oil Co. Ltd. 8.90% 2000 /1/ 20,000 20,288 .31 OXYMAR 7.50% 2016 8,500 7,756 .12 Parker & Parsley Petroleum 8.25% 2007 6,000 6,257 .10 Subic Power Corp. 9.50% 2008 /1/ 5,603 5,568 .08 TransTexas Gas Corp. 11.50% 2002 4,000 3,980 .06 -------------- ---------- 190,755 2.94 -------------- ---------- Food Retailing Allied Supermarkets Inc. 6.625% 1998 2,872 2,757 .04 Bruno's Inc. 10.50% 2005 6,000 5,917 .09 Carr-Gottstein Co. 12.00% 2005 10,000 10,250 .16 Safeway Inc. 10.00% 2002 1,500 1,650 .03 Smith's Food & Drug Centers, Inc., Series 94A2, 0%/8.64% 2012 /2/ /4/ 14,000 11,218 .17 Star Markets Co., Inc. 13.00% 2004 1,500 1,560 .03 Stater Bros. Holdings Inc. 11.00% 2001 9,500 9,880 .15 -------------- ---------- 43,232 .67 -------------- ---------- Forest Products & Paper Container Corp. of America: 10.75% 2002 4,800 4,944 9.75% 2003 31,500 30,949 .65 11.25% 2004 6,000 6,195 Fort Howard Corp.: 9.25% 2001 7,000 7,000 .17 11.00% 2002 3,635 3,744 Fort Howard Paper Co.: 8.25% 2002 3,000 2,880 .09 9.00% 2006 3,250 3,120 Grupo Industrial Durango, SA de CV 12.00% 2001 6,000 6,000 .09 PT Indah Kiat Pulp & Paper Corp. 11.875% 2002 5,500 5,844 .09 Pacific Lumber Co. 10.50% 2003 500 485 .01 Repap Wisconsin 9.875% 2006 6,375 5,674 .09 Tjiwi Kimia International Finance Co. 13.25% 2001 7,500 8,400 .13 -------------- ---------- 85,235 1.32 -------------- ---------- General Retailing & Merchandising Ann Taylor, Inc. 8.75% 2000 4,500 4,230 .07 Barnes & Noble, Inc. 11.875% 2003 6,000 6,435 .10 Dayton Hudson Corp.: 10.00% 2010 10,000 10,045 .25 8.50% 2022 5,000 5,844 Loehmann's Inc. 11.875% 2003 5,250 5,460 .08 Thrifty PayLess, Inc. 12.25% 2004 6,227 7,357 .11 -------------- ---------- 39,371 .61 -------------- ---------- Health & Personal Care Integrated Health Services, Inc.: 10.75% 2004 2,250 2,306 .18 10.25% 2006 /1/ 9,350 9,257 Mariner Health Group, Inc. 9.50% 2006 5,500 5,335 .08 Merit Behaviorial Care Corp. 11.50% 2005 3,000 3,150 .05 Universal Health Services, Inc. 8.75% 2005 2,300 2,248 .03 -------------- ---------- 22,296 .34 -------------- ---------- Leisure & Tourism AMF Group Inc.: 10.875% 2006 /1/ 4,750 4,679 .13 0%/12.25% 2006 /1/ /2/ 6,500 3,534 Discovery Zone 0% convertible debentures 2013 28,500 1,211 .02 Embassy Suites, Inc. 10.875% 2002 2,000 2,145 .03 Euro Disney SCA 6.75% convertible debentures 2001 FF108,780 20,628 .32 Foodmaker, Inc.: 9.25% 1999 9,700 9,652 .22 9.75% 2002 4,405 4,207 Four Seasons Hotels Inc. 9.125% 2000 6,000 6,008 .09 Harrah's Jazz Co. 8.75% 2000 2,000 2,010 .03 Plitt Theatres, Inc. 10.875% 2004 2,100 2,121 .03 Station Casinos, Inc. 9.625% 2003 5,000 4,800 .07 Trump Atlantic City Assoc. 11.25% 2006 6,500 6,533 .10 Wyndham Hotel Corp. 10.50% 2006 4,000 4,000 .06 -------------- ---------- 71,528 1.10 -------------- ---------- Machinery & Engineering AGCO Corp. 8.50% 2006 /1/ 3,000 2,940 .04 Coltec Industries Inc.: 9.75% 1999 7,000 7,140 .25 9.75% 2000 8,619 8,791 John Deere Capital Corp. 8.625% 2019 9,150 9,733 .15 Northrop Grumman 9.375% 2024 5,000 5,376 .08 Westinghouse Air Brake Co. 9.375% 2005 1,500 1,485 .02 -------------- ---------- 35,465 .55 -------------- ---------- Metals Acme Metals Inc.: 12.50% 2002 4,500 4,601 .20 0%/13.50% 2004 /2/ 9,000 8,190 AK Steel Corp. 10.75% 2004 4,750 5,118 .08 INCO Ltd.: 9.875% 2019 7,500 8,116 .38 9.60% 2022 16,000 16,774 ISPAT Mexicana: (Euro) 10.375% 2001 4,650 4,505 .10 10.375% 2001 /1/ 2,000 1,938 Kaiser Aluminum and Chemical Corp.: 9.875% 2002 1,400 1,372 .32 12.75% 2003 18,500 19,518 Oregon Steel Mills, Inc. 11.00% 2003 5,250 5,408 .08 Tubos de Acero de Mexico, SA 13.750% 1999 /1/ 2,500 2,731 .04 UCAR Global Enterprises Inc. 12.00% 2005 3,430 3,893 .06 USX Corp. 9.125% 2013 7,500 8,139 .13 -------------- ---------- 90,303 1.39 -------------- ---------- Miscellaneous Materials & Commodities A.P.S., 11.875% 2006 /1/ 3,000 3,112 .05 Building Materials Corp. of America 0%/11.75% 2004 /2/ 6,000 4,470 .07 NL Industries 11.75% 2003 1,000 1,020 .01 Owens-Illinois, Inc. 11.00% 2003 5,000 5,375 .08 Tolmex, SA de CV 8.375% 2003 1,500 1,254 .02 -------------- ---------- 15,231 .23 -------------- ---------- Multi-Industry Hanson America, Inc. 144A 2.39% convertible debentures 2001 /1/ 20,000 17,000 .26 Swire Pacific Ltd. 8.50% 2004 /1/ 20,000 20,811 .32 Tenneco Inc. 7.875% 2002 3,000 3,088 .05 -------------- ---------- 40,899 .63 -------------- ---------- Protection Services ADT Operations 9.25% 2003 2,500 2,581 .04 ASH Capital Finance, Ltd. convertible debentures 9.50% 2004,500 pounds 6,477 .10 Protection One Alarm Monitoring, Inc. Units, 0%/13.625% 20 $17,054 15,306 .24 -------------- ---------- 24,364 .38 -------------- ---------- Telecommunications 360/0/ Communications Co.: 7.125% 2003 30,000 28,688 .62 7.50% 2006 12,000 11,385 Brooks Fiber Properties, Inc. 0%/10.875% 2006 /1/ /2/ 7,500 3,994 .06 CellNet Data Systems, Inc. Units, 0%/13.00% 2005 /1/ /2/ / 49,750 35,571 .55 Cellular, Inc. 0%/11.75% 2003 /2/ 10,500 8,557 .13 Cellular Communications International, Inc. Units 0% 2000 15,071 9,344 .15 Centennial Cellular Corp.: 8.875% 2001 19,000 17,575 .71 10.125% 2005 5,000 4,800 Series A, 0% 2000 20,500 13,991 Series B, 0% 2000 14,400 9,864 Commnet Cellular Inc. 11.25% 2005 5,500 5,858 .09 Comunicacion Celular S.A. Units, 0%/13.125% 2003 /1/ /2/ 17,550 11,320 .17 Geotek Communications, Inc. 0%/15.00% 2005 /2/ 9,013 7,678 .12 Horizon Cellular Telephone Co., LP 0%/11.375% 2000 /2/ 15,500 14,570 .23 IntelCom Group, Inc.: 0%/13.50% 2005 /2/ 11,298 7,276 .20 0%/12.50% 2006 /1/ /2/ 10,500 5,723 MFS Communications Co., Inc. 0%/9.375% 2004 /2/ 65,750 49,313 .99 0%/8.875% 2006 /2/ 25,000 15,125 MobileMedia Communications, Inc. 0%/10.50% 2003 /2/ 8,600 6,106 .10 New York Telephone Co. 9.375% 2031 /1/ 5,000 5,463 .08 NEXTEL Communications, Inc.: 0%/11.50% 2003 /2/ 30,000 20,550 1.28 0%/9.75% 2004 /2/ 44,750 26,291 0%/10.125% 2004 /2/ (CenCall) 33,000 20,048 0%/12.25% 2004 /2/ (DialCall) 24,750 15,840 Northern Telecom Ltd. 8.75% 2001 3,500 3,758 .06 Omnipoint Corp. Units, 6.00%/12.00% 2000 /3/ /4/ 12,500 18,516 .29 Paging Network, Inc. 11.75% 2002 10,275 11,046 .17 PanAmSat, LP PanAmSat Capital Corp. 9.75% 2000 9,800 10,131 .16 PriCellular Wireless Corp.: 0%/14.00% 2001 /2/ 6,000 5,430 .29 0%/12.25% 2003 /2/ 17,750 13,934 Rogers Cantel Communications Inc. 9.375% 2008 3,000 2,910 .04 Telecom Argentina STET - France Telecom S. A. 12.00% 1999 5,500 5,899 .09 Teleport Communications 9.875% 2006 5,000 5,013 .08 -------------- ---------- 431,567 6.66 -------------- ---------- Textiles & Apparel Tultex Corp. 10.625% 2005 2,750 2,846 .04 WestPoint Stevens Inc. 8.75% 2001 2,500 2,469 .04 -------------- ---------- 5,315 .08 -------------- ---------- Transportation Air Wis Services, Inc. 7.75% convertible debentures 2010 4,000 3,660 .06 Airplanes Pass Through Trust, pass-through certificates: Series 1, Class B, 6.59609% 2019 /5/ 7,418 7,459 1.00 Series 1, Class C, 8.15% 2019 /5/ 45,000 44,831 Series 1, Class D, 10.875% 2019 /5/ 11,800 12,257 Alaska Airlines: Series A, 9.50% 2010 2,397 2,432 .22 Series B, 9.50% 2010 3,024 3,071 Series C, 9.50% 2010 2,927 2,975 Series D, 9.50% 2012 4,889 4,971 American Airlines, Inc.: 1991-C2, mortgage pass-through certificates, 9.73% 2014 6,000 6,755 .19 1991-A, mortgage pass-through certificates, 9.71% 2007 /5 4,481 4,947 Atlas Air,Inc., pass-through certificates, 12.25% 2002 11,000 11,962 .18 Continental Airlines, Inc.: 6.75% convertible debentures 2006 /1/ 7,500 8,925 .59 pass-through certificates: Series 1996-A 6.94% 2015 /1/ /5/ 4,000 3,860 Series 1996-B 7.82% 2015 /1/ /5/ 13,500 13,635 Series 1996-B 9.50% 2015 /1/ /5/ 5,000 5,338 Series 1996-2B 8.56% 2014 /1/ /5/ 2,000 2,125 Series 1996-2D 11.50% 2008 /1/ /5/ 4,500 4,631 Delta Air Lines, Inc.: 9.875% 2000 2,000 2,185 1.16 pass-through certificates: Series 1992-A2, 9.20% 2014 /5/ 11,750 12,884 Series 1992-B1, 9.375% 2007 /5/ 9,102 9,819 Series 1993-A2, 10.50% 2016 /5/ 15,000 17,822 Series 1993-B2, 10.06% 2016 /5/ 3,700 4,260 Series 1993-C2, 9.59% 2017 /5/ 5,000 5,575 1990 Equipment trust certificates: Series J, 10.00% 2014 /1/ 10,000 11,419 Series I, 10.00% 2014 /1/ 8,000 9,136 Series F, 10.79% 2014 /1/ 1,700 2,058 Epic 1996-1 Trust, Equipment pass-through certificates, Class b, 7.55% 2009 5,500 5,500 .08 Federal Express Corp.: 8.40% 2010 10,000 10,297 .24 1996 pass through certificates, Series A1, 7.85% 2015 /5/ 5,000 5,063 Jet Equipment Trust: Series 1994-A, 10.91% 2006 /1/ 6,965 7,966 1.07 Series 1994-A, 11.79% 2006 /1/ 4,000 4,620 Series 1995B-Certificates, 10.91% 2014 5,000 5,413 Series 1995-A, 11.44% 2014 /1/ 10,000 11,263 Series 1995-A, 10.69% 2015 /1/ 10,500 12,338 Series 1995B-A, 7.63% 2015 /1/ 23,081 22,903 Series 1995B-C, 9.71% 2015 /1/ 5,500 5,988 MC-Cuernavaca Trust 9.25% 2001 /1/ 4,938 3,395 .05 Northwest Airlines, Inc. 12.0916% 2000 7,569 7,721 .12 Teekay Shipping Corp. 8.32% 2008 6,000 5,625 .09 TNT Transport (Euro) PLC/TNT (USA) Inc. 11.50% 2004 4,750 4,869 .08 United Air Lines, Inc., pass-through certificates: Series 1993-A3, 8.39% 2011 /5/ 7,500 7,650 .58 Series 1995-A1, 9.02% 2012 /5/ 11,065 11,722 Series 1995-A2, 9.56% 2018 /5/ 8,000 8,787 Series 1996-A1, 7.27% 2013 /5/ 5,000 4,734 Series 1996-A2, 7.87% 2019 /5/ 5,000 4,750 USAir, Inc.: 1990 Equipment Trust Certificates: Series A, 10.28% 2001 754 747 .73 Series B, 10.28% 2001 754 747 Series C, 10.28% 2001 530 525 9.625% 2003 1,796 1,688 10.00% 2003 6,500 6,126 pass-through trust: Series 1989-A1, 9.33% 2006 /5/ 3,849 3,714 Series 1993-A2, 9.625% 2003 /5/ 4,625 4,509 Series 1993-A3, 10.375% 2013 /5/ 7,250 7,259 Class A, 6.76% 2008 /1/ /5/ 5,000 4,756 Class B, 7.50% 2008 /1/ /5/ 8,500 8,383 Class C, 8.93% 2008 /1/ /5/ 9,000 9,304 -------------- ---------- 417,354 6.44 -------------- ---------- FINANCE Banking & Thrifts Bank of Scotland 8.80% 2004 /1/ 16,000 17,292 .27 Berkeley Federal Bank & Trust 12.00% 2005 1,500 1,556 .02 Capital One Bank 7.35% 2000 5,000 5,031 .08 Den Danske Bank AS 7.25% 2005 /1/ 14,025 13,870 .21 First Nationwide 12.25% 2001 9,000 9,810 .15 First Nationwide Holdings Inc.: 9.125% 2003 /1/ 6,000 5,700 .09 12.5% 2003 /1/ 6,000 6,270 .10 Kansallis-Osak:-Pankki: 9.75% 1998 5,000 5,338 .08 10.00% 2002 1,000 1,128 .02 Midland American Capital 12.75% 2003 12,150 13,726 .21 New American Capital, Inc. 9.60% 1999 /1/ 15,000 15,056 .23 Skandinaviska Enskilda Banken (N.Y. City) 6.875% 2009 5,500 5,163 .08 State Bank of New South Wales Euronotes 10.375% 1999 3,000 3,266 .05 -------------- ---------- 103,206 1.59 -------------- ---------- Finanxial Services Beneficial Corp. 12.875% 2013 3,800 4,408 .07 Credit Foncier de France 8.00% 2002 18,100 18,292 .28 Ford Motor Credit Co. 9.50% 2000 7,350 7,973 .12 General Electric Capital Corp. 8.875% 2009 8,000 9,218 .14 General Motors Acceptance Corp.: 7.00% 2000 5,000 5,025 .08 8.75% 2005 10,000 10,836 .17 -------------- ---------- 55,752 .86 -------------- ---------- Insurance American Re Corp. 10.875% 2004 10,000 10,874 .17 CIGNA Corp. 6.375% 2006 5,000 4,600 .07 Equitable Life Assurance Society of the United States 7.70 10,000 9,669 .15 Fairfax Financial Holdings Ltd., 8.25% 2015 14,000 13,989 .22 Fidelity National Financial 0% 2009 20,000 8,750 .13 Metropolitan Life Insurance Co. 7.45% 2023 /1/ 10,000 9,068 .14 New York Life Insurance Co. 7.50% 2023 /1/ 15,000 13,999 .22 Terra Nova Insurance (UK) Holdings PLC 10.75% 2005 2,500 2,775 .04 -------------- ---------- 73,724 1.14 -------------- ---------- Real Estate B.F. Saul REIT 11.625% 2002 20,000 20,500 .32 Beverly Finance Corp. 8.36% 2004 /1/ 15,000 15,436 .24 Corporate Property Investors: 9.00% 2002 /1/ 2,000 2,149 .03 7.75% 2004 /1/ 4,250 4,281 .07 ERP Operating Limited Partnership 7.95% 2002 6,750 6,837 .10 Irvine Co. 7.46% 2006 /1/ /4/ 17,000 15,916 .24 Price REIT, Inc. 7.25% 2000 5,000 4,909 .07 Security Capital Industrial Trust: 7.25% 2002 1,000 998 .02 7.95% 2008 5,000 4,966 .08 7.875% 2009 6,250 6,152 .09 Security Capital Pacific Trust: 7.15% 2010 2,000 1,913 .03 7.90% 2016 2,000 1,923 .03 Shopping Center Associates 6.75% 2004 /1/ 12,000 11,340 .17 Taubman Realty Group 7.00% 2003 2,000 1,857 .03 Wellsford Residential Property Trust: 7.25% 2000 1,000 991 .02 7.75% 2005 1,000 1,005 .02 Wharf Capital International, Ltd. 8.875% 2004 15,000 15,401 .24 -------------- ---------- 116,574 1.80 -------------- ---------- COLLATERALIZED MORTGAGE/ASSET-BACKED OBLIGATIONS /5/ (Excluding Those Issued by Federal Agencies) Banco Nacional de Mexico 0% 2002 /1/ 19,759 15,066 .23 Capstead Securities Corp. IV, collateralized mortgage obligations, Series 1992-4, Class J, 19.6067% 2022 /6/ 8,750 9,013 .14 Chase Manhattan Bank, N.A.: Series 96-1 Class A1, 7.60% 2006 5,000 5,058 .08 Series 93-I Class 2A5, 7.60% 2024 10,000 9,488 .15 Countrywide Funding Corp., Series 94-2, Class A-12, 6.3985% 2009 /6/ 5,206 3,117 .05 CSFB Finance Co. Ltd., Series 1995-A, 5.00%/7.00% 2005 /3/ 30,000 28,995 .45 CS First Boston Mortgage Securities Corp., mortgage pass-through certificates: Series 1995-AEW1, 6.665% 2027 901 891 .01 Series 1995-MBL1, 6.425% 2030 17,079 16,925 .26 Electronic Transfer Master Trust 9.35% 2002 /1/ 18,000 18,068 .28 GCC Home Equity Trust, asset-backed certificates, Series 1990-1, 10.00% 2005 3,284 3,343 .05 G E Capital Mortgage Services: Series 1994-9, Class A9, 6.50% 2024 3,938 3,259 .05 Series 1994-15, Class A10, 6.00% 2009 16,376 14,022 .22 Series 1995-1, Class A8, 8.40% 2025 21,785 22,183 .34 Green Tree Financial Corp., pass-through certificates: Series 1994-A, Class NIM, 6.90% 2004 2,974 2,944 .05 Series 1995-A, Class NIM, 7.25% 2005 3,152 3,145 .05 Series 1993-2, Class B, 8.00% 2018 2,250 2,254 .03 Series 1995-9, Class A-5, 6.80% 2027 8,000 7,720 .12 J.P. Morgan Commercial Mortgage Finance Corp.,pass- through certificates: Series 1995-C1, Class A-2, 7.3985% 2010 /3/ 1,000 978 .02 Series 1996-C3, Class A-1, 7.33% 2028 /3/ 1,000 988 .02 Merrill Lynch Mortgage Investors, Inc.: Series 1995-C2, Class D, 8.2657% 2021 /3/ 964 964 .01 Series 1995-C3, Class A1, 6.7885% 2025 /3/ 2,918 2,866 .04 Morgan Stanley Capital Inc., Series 1995-GA1, Class A1, 7.00% 2002 /1/ 17,514 17,470 .27 Prudential Home Mortgage Securities Co., Inc.: Series 1993-7, Class A-4, 8.00% 2003 9,323 9,474 .15 Series 1993-7, Class A-5, 8.00% 2003 3,079 3,082 .05 Series 1993-48, Class A-6, 6.25% 2008 4,466 4,035 .06 Series 1992-37, Class A-6, 7.00% 2022 1,922 1,919 .03 Series 1993-34, Class A-1, 7.00% 2023 15,974 15,879 .24 Residential Funding Mortgage Securities I, Inc., Series 1992-S6, Class A-10, 12.102% 2022 /6/ 10,124 9,061 .14 Resolution Trust Corp.: Series 1991-M5, Class B, 9.00% 2017 2,532 2,586 .04 Series 1992-6, Class A-2B, 8.40% 2024 7,602 7,651 .12 Series 1993-C1, Class D, 9.45% 2024 9,352 9,574 .15 Series 1993-C1, Class E, 9.50% 2024 612 607 .01 Series 1993-C2, Class C, 8.00% 2025 3,000 3,011 .05 Series 1993-C2, Class D, 8.50% 2025 3,290 3,308 .05 Series 1993-C2, Class E, 8.50% 2025 564 555 .01 Ryland Mortgage Securities Corp., Series 1991-14, Class F, 21.528% 2021 /6/ 1,070 1,160 .02 SKW II Real Estate LP 6.90% 2002 /1/ 4,618 4,618 .07 Standard Credit Card Master Trust I, credit card participation certificates, Series 1994-2A, 7.25% 2008 5,000 4,998 .08 Standard Credit Card Trust, credit card participation certificates: Series 1990-3A, 9.50% 1998 5,000 5,138 .08 Series 1990-6A, 9.375% 1998 4,000 4,120 .06 Series 1991-3A, 8.875% 1999 11,000 11,505 .18 Structured Asset Securities Corp., pass-through certificates, Series 1995-C1, Class A1A, 7.375% 2024 842 842 .01 Series 1996-CFL, Class D, 7.034% 2028 2,950 2,804 .04 Series 1996-CFL, Class E, 7.034% 2028 1,947 1,964 .03 UCFC Acceptance Corp. pass-through certificates: Series 1995-A1, Class A1, 7.55% 2004 279 279 .00 Series 1996-B1, Class A2, 7.075% 2010 10,000 10,008 .15 -------------- ---------- 306,935 4.73 -------------- ---------- GOVERNMENTAL Governments (Excluding U.S. Government) Argentina (Republic of): 8.375% 2003 10,000 8,700 .13 Eurobond 6.8125% 2005 /3/ 30,893 24,174 .37 Eurobond 5.00% 2023 /3/ 6,500 3,575 .05 British Columbia Hydro & Power Authority: 15.50% 2011 17,000 18,230 .28 15.50% 2011 4,467 4,914 .08 12.50% 2013 4,000 4,607 .07 12.50% 2014 7,000 8,174 .13 Canadian Government: 10.50% 2001 C$5,000 4,169 .06 6.50% 2004 34,500 23,787 .37 9.00% 2004 37,750 30,155 .47 8.75% 2005 C$15,000 11,836 .18 4.524% 2021 /3/ 2,000 1,443 .02 Deutschland Republic: 6.25% 2024 DM6,000 3,471 .05 8.00% 2002 34,050 24,655 .38 Israel (State of) 6.375% 2005 $10,00 9,293 .14 Italian Government National: 10.50% 2005 ITL30,000,00 21,079 .33 Italy (Republic of) 6.875% 2023 $33,0 29,757 .46 New Zealand Government 4.50% 2016 MZ$33,000 5,722 .09 Nova Scotia (Province of) 11.50% 2013 $2,2 2,482 .04 Ontario (Province of): 7.75% 2002 3,500 3,652 .06 7.375% 2003 1,250 1,278 .02 7.625% 2004 5,000 5,137 .08 7.00% 2005 10,750 10,596 .16 17.00% 2011 11,250 12,386 .19 15.25% 2012 6,985 8,039 .12 Panama Interest Reduction Bond 3.50% 2014 9,000 4,995 .08 Poland (Republic of): Discount Bond 7.125% 2024 /3/ 750 703 .01 Past Due Interest Bond 3.75% 2014 /3/ 21,000 16,144 .25 Past Due Interest Bond 3.75% 2014 /3/ 7,000 5,381 .08 Treasury Bill 1997 16,200 5,023 .08 Quebec (Province of): 8.625% 2005 6,750 7,267 .11 13.25% 2014 5,500 6,683 .10 South Africa (Republic of) 13.00% 2010 ZAR117,000 23,890 .37 United Mexican States Government Eurobonds: Global 11.50% 2026 $1,1 1,071 .02 Series A, 6.25% 2019 1,000 649 .01 Series B, 6.25% 2019 4,875 3,163 .05 Venezuela (Republic of) 6.625% 2007 /3/ 10,000 7,063 .11 -------------- ---------- 363,343 5.60 -------------- ---------- Development Authorities European Investment Bank 10.125% 2000 2,000 2,238 .03 Inter-American Development Bank 8.875% 2009 10,000 11,465 .18 International Bank for Reconstruction & Development 14.90% 1997 2,500 2,694 .04 -------------- ---------- 16,397 .25 -------------- ---------- Federal Agency Obligations - Mortgage Pass-Throughs /5/ Federal Home Loan Mortgage Corp.: 8.00% 2003-2010 6,277 6,386 .99 8.25% 2007 3,084 3,169 8.50% 2002-2020 38,744 39,971 8.75% 2008 3,928 4,095 9.00% 2021 1,156 1,215 10.00% 2011-2019 518 558 10.50% 2020 3,167 3,489 10.75% 2010 141 155 11.50% 2000 45 47 12.00% 2011-2015 1,775 2,001 12.50% 2009-2014 2,044 2,370 12.75% 2015-2019 723 831 13.00% 2014 77 90 13.50% 2018 14 17 13.75% 2014 26 31 Federal National Mortgage Assn.: 6.50% 2025 1,353 1,266 1.45 7.00% 2009-2010 8,727 8,634 7.50% 2009-2024 17,882 17,826 8.00% 2023 3,400 3,441 8.50% 2009-2023 14,063 14,564 9.00% 2018-2025 7,820 8,199 9.50% 2009-2025 7,108 7,598 10.00% 2018-2025 20,126 21,928 10.50% 2012-2019 5,567 6,098 11.00% 2015-2020 3,777 4,193 11.25% 2014 72 80 11.50% 2010-2014 329 371 12.00% 2015-2019 163 186 12.50% 2015 361 418 13.00% 2014 65 76 15.00% 2013 84 100 Government National Mortgage Assn.: 5.00% 2024 /3/ 1,968 1,899 9.19 5.50% 2023-2024 /3/ 143,198 143,579 6.00% 2022-2024 /3/ 62,570 63,326 6.125% 2022 /3/ 9,085 9,210 6.50% 2008-2026 /3/ 40,999 38,804 7.00% 2008-2024 /3/ 117,279 114,747 7.50% 2008-2024 82,953 82,422 8.00% 2023-2025 20,925 21,224 8.50% 2020-2026 70,186 72,312 9.00% 2016-2025 19,971 20,998 9.50% 2009-2020 17,414 18,722 10.00% 2017-2019 2,763 3,008 10.50% 2015-2019 913 1,008 11.00% 2013-2016 1,527 1,709 11.50% 2015 62 70 12.00% 2014 156 180 12.50% 2010-2015 1,097 1,275 13.25% 2014 85 100 -------------- ---------- 753,996 11.63 -------------- ---------- Federal Agency Obligation - Other Federal Home Loan Bank Bonds: 6.16% 2004 24,000 22,732 1.34 6.27% 2004 5,000 4,747 6.38% 2003 3,000 2,890 6.41% 2003 18,580 17,816 7.00% 2005 35,000 33,873 8.23% 2004 5,000 4,987 Federal Home Loan Mortgage Notes: 5.74% 2003 6,500 6,058 1.82 5.78% 2003 14,520 13,492 6.185% 2003 19,845 18,819 6.19% 2004 11,000 10,374 6.24% 2003 2,900 2,761 6.27% 2004 2,500 2,375 6.28% 2003 3,000 2,872 6.30% 2003 2,000 1,926 6.375% 2003 5,820 5,580 6.39% 2003 10,330 9,931 6.50% 2003 6,200 5,937 6.555% 2006 7,500 7,123 7.00% 2002 25,000 24,570 7.29% 2004 6,000 5,927 Federal National Mortgage Assoc. Notes: 7.70% 2004 12,500 12,617 .84 medium-term notes 6.14% 2004 13,000 12,303 7.43% 2005 30,000 29,527 FNSM Callable Principal STRIPS 0%/8.25% 2022 /2/ 4,500 3,641 .06 -------------- ---------- 262,878 4.06 -------------- ---------- Collateralized Mortgage Obligations - Federal Agencies /5/ Federal Home Loan Mortgage Corp.: Series 1712, Class D, 6.00% 2009 7,500 6,621 .34 Series 1716, Class A, 6.50% 2009 4,750 4,460 Series 1574, Class AB, 6.50% 2023 5,002 3,703 Series 1657, Class SA, 6.7659% 2023 /6/ 7,520 3,812 Series 1673, Class SA, 5.0784% 2024 /6/ 7,879 3,413 Federal National Mortgage Assn.: Series 90-142, Class J, 9.25% 2003 292 291 .50 Series 91-146, Class Z, 8.00% 2006 6,528 6,594 Series 91-65, Class X, 6.50% 2019 20,360 19,024 Series 90-93, Class G, 5.50% 2020 1,500 1,354 Series 93-138, Class SA, 7.8532% 2023 /6/ 3,758 2,358 Series 93-247, Class Z, 7.00% 2023 3,553 3,016 -------------- ---------- 54,646 .84 -------------- ---------- U.S. Treasury Obligations 8.125% February 1998 120,750 124,523 1.92 5.875% April 1998 5,000 4,980 .08 9.25% August 1998 227,250 240,921 3.72 8.875% February 1999 43,500 46,212 .71 9.125% May 1999 20,750 22,258 .34 6.875% July 1999 62,000 62,882 .97 8.875% May 2000 30,000 32,494 .50 8.750% August 2000 25,000 27,074 .42 8.50% November 2000 63,000 67,912 1.05 7.75% February 2001 33,000 34,681 .53 8.00% May 2001 7,000 7,442 .11 13.125% May 2001 21,500 27,449 .42 14.25% February 2002 7,000 9,533 .15 6.375% August 2002 1,500 1,488 .02 11.625% November 2002 92,000 115,977 1.79 5.75% August 2003 8,000 7,619 .12 7.25% May 2004 74,375 77,059 1.19 7.875% November 2004 6,000 6,449 .10 11.625% November 2004 79,000 103,601 1.60 6.50% May 2005 30,000 29,606 .45 10.375% November 2009 49,500 60,537 .93 10.00% May 2010 7,500 9,055 .14 12.75% November 2010 10,500 14,744 .23 10.375% November 2012 29,000 36,816 .57 12.00% August 2013 10,000 14,097 .22 8.875% August 2017 164,250 197,202 3.04 8.125% May 2021 27,000 30,409 .47 6.25% August 2023 1,500 1,360 .02 -------------- ---------- 1,414,380 21.81 -------------- ---------- Floating Rare Eurodollar Notes (Undated) /3/ Allied Irish Banks Ltd. 6.4375% 10,000 8,981 .14 Bank of Nova Scotia 6.00% 10,000 8,250 .13 Bergen Bank 6.00% 5,000 4,091 .06 Canadian Imperial Bank of Commerce 6.125% 25,000 20,625 .32 Christiana Bank Og Kreditkasse 6.0625% 6,000 5,010 .08 Hongkong and Shanghai Banking Corp. 6.25% 10,000 8,461 .13 Lloyds Bank (#2) 6.062% 5,000 4,315 .07 Midland Bank 5.8125% 5,000 4,283 .06 National Bank of Canada 3.03125% 5,000 3,645 .06 Standard Chartered Bank: 5.78% 5,000 4,094 .06 5.81% 15,000 12,226 .19 -------------- ---------- 83,981 1.30 -------------- ---------- EQUITY-TYPE SECURITIES & MISCELLANEOUS Equity-Type Securities /7/ Dial Page, Inc., warrants /4/ 39 0 .00 -------------- ---------- MISCELLANEOUS Investment securities in the initial period of acquisition 11,168 .17 -------------- ---------- TOTAL BONDS, NOTES AND EQUITY-TYPE SECURITIES ---------- ---------- (cost: $6,029,864,000) 5,983,106 92.28 ---------- ---------- SHORT-TERM SECURITIES Commercial Paper ARCO Coal Australia Inc.: 5.34% due 7/19/96 11,800 11,767 .18 5.38% due 7/22/96 15,979 15,927 .25 5.38% due 7/26/96 13,000 12,950 .20 American Express Credit Corp.: 5.35% due 7/26/96 17,000 16,935 .26 5.34% due 7/30/96 25,000 24,890 .38 Ameritech Capital Funding Corp.: 5.32% due 7/19/96 10,000 9,972 .15 5.39% due 8/19/96 25,000 24,812 .38 Coca-Cola Co.: 5.28% due 7/9/96 2,100 2,097 .03 5.35% due 7/16/96 25,000 24,941 .39 Ford Motor Credit Co.: 5.33% due 7/10/96 20,000 19,971 .31 5.33% due 7/15/96 8,250 8,232 .13 5.43% due 8/26/96 18,700 18,541 .29 Lucent Technologies: 5.29% due 7/18/96 10,000 9,974 .15 5.38% due 7/24/96 20,000 19,929 .31 Monsanto Co.: 5.38% due 7/11/96 15,000 14,975 .23 5.31% due 7/22/96 12,000 11,961 .18 5.42% due 8/6/96 13,100 13,028 .20 Raytheon Co.: 5.36% due 7/8/96 15,000 14,982 .23 5.37% due 7/24/96 5,000 4,982 .08 UBS Finance (Delaware) 5.58% due 7/1/96 50,000 49,992 .77 Weyerhaeuser Co.: 5.32% due 7/2/96 14,250 14,246 .22 5.44% due 9/6/96 15,000 14,847 .23 Xerox Corp.: 5.39% due 8/2/96 10,000 9,951 .15 5.40% due 8/9/96 10,000 9,941 .15 5.40% due 8/14/96 20,000 19,865 .31 5.42% due 8/16/96 20,000 19,859 .31 -------------- ---------- 419,567 6.47 -------------- ---------- Federal Agency Discount Notes Federal Home Loan Mortgage Corp. 5.35% due 8/12/96 25,000 24,842 .38 -------------- ---------- TOTAL SHORT-TERM SECURITIES (Cost $444,417,000) 444,409 6.85 -------------- ---------- TOTAL INVESTMENT SECURITIES (cost $6,474,281,000) 6,427,515 99.13 Excess of cash and receivables over payables 56,244 .87 -------------- ---------- NET ASSETS 6,483,759 100.00% ============== ========== /1/ Private placement transaction; resale may be made to qualified institutional buyers. /2/ Zero coupon bond which will convert to an interest-bearing security at a later date. /3/ Coupon rates may change periodically. /4/ Valued under procedures established by the Board of Directors /5/ Pass-through securities backed by a pool of mortgages or other loans on which principal payments are periodically made. Therefore, the effective maturity of these securities is shorter than the stated maturity. /6/ Inverse floater, which is a floating rate note whose interest rate moves in the opposite direction of prevailing interest rates. /7/ Non-income-producing security. See Notes to Financial Statements
The Bond Fund of America FINANCIAL STATEMENTS STATEMENT OF ASSETS AND LIABILITIES Unaudited June 30, 1996 (dollars in thousands) Assets: Investment securities at market (cost: $6,474,281) $6,427,515 Cash 1,328 Prepaid expense .................... Receivables for-- Sales of investments $34,400 Sales of Fund's shares 16,093 Dividends and accrued interest 101,528 152,021 ------------ --------------- 6,580,864 Liabilities: Payables for-- Purchases of investments 80,182 Repurchases of fund's shares 8,636 Forward currency contracts 881 Dividends on Fund's shares 3,965 Management services 1,822 Accrued expenses 1,619 97,105 1,658 $98,763 ------------ --------------- Net Assets at July 30, 1996-- Equivalent to $13.47 per share on 481,480,197 shares of $1 par value capital stock outstanding (authorized capital stock - 1,000,000,000 shares) $6,483,759 =============== STATEMENT OF OPERATIONS for the six months ended June 30, 1996 (dollars in thousands) Investment Income: Income: Interest $263,742 Dividends from investment in stocks 0 $0 Expenses: Management services fee $11,233 Distribution expenses 7,901 Transfer agent fee 2,427 Reports to shareholders 369 Registration statement and prospectus 616 Postage, stationery and supplies 864 Directors' fees 17 Auditing and legal fees 43 Custodian fee 143 Taxes other than federal income tax 102 Other expenses 42 23,757 ------------ --------------- Net investment income $239,985 =============== Realized Loss and Unrealized Depreciation on Investments: Net realized loss (2,551) Net unrealized appreciation (depreciation) on: Investments (205,153) Open forward currency contracts 984 ------------ Net unrealized depreciation (204,169) --------------- Net realized loss and unrealized depreciation on investments (206,720) --------------- Net Increase in Net Assets Resulting $33,265 from Operations =============== STATEMENT OF CHANGES IN NET ASSETS (dollars in thousands) Six Months Year ended Ended December 31, June 30, 1995 1996* Operations: Net investment income $239,985 $442,418 Net realized loss on investments (2,551) (13,362) Net unrealized (depreciation) appreciation on investments (204,169) 506,227 ------------ --------------- Net increase in net assets resulting from operations 33,265 935,283 ------------ --------------- Dividends Paid to Shareholders: Dividends from net investment income (226,154) (438,147) ------------ --------------- Total dividends and distributions (226,154) (438,147) ------------ --------------- Capital Share Transactions: Proceeds from shares sold: 71,722,652 and 119,215,625 shares, respectively 977,179 1,591,640 Proceeds from shares issued in reinvestment of net investment income dividends and distributions of net realized gain on investments: 10,719,410 and 23,407,092 shares, respectively 146,241 312,925 Cost of shares repurchased: 54,177,054 and 78,844,004 shares, respectively (736,948) (1,052,675) ------------ --------------- Net increase in net assets resulting from capital share transactions 386,472 851,890 ------------ --------------- Total Increase (Decrease) in Net Assets 193,583 1,349,026 Net Assets: Beginning of period 6,290,176 4,941,150 ------------ --------------- End of period (including undistributed net investment income: $21,589 and $7,758 respectively) 6,483,759 $6,290,176 ============ =============== *Unaudited See Notes to Financial Statements
NOTES TO FINANCIAL STATEMENTS 1. The Bond Fund of America, Inc. (the "fund") is registered under the Investment Company Act of 1940 as an open-end, diversified management investment company. The fund seeks as high a level of current income as is consistent with preservation of capital through a diversified portfolio of bonds and other fixed-income obligations. The following paragraphs summarize the significant accounting policies consistently followed by the fund in the preparation of its financial statements: Long-term fixed income obligations are valued at prices obtained for the day of valuation from a bond-pricing service; however, where prices are not available from a pricing service and in circumstances where the investment adviser deems it appropriate to do so, such securities are valued at the mean of representative quoted bid and asked prices for such securities or, if such prices are not available, at prices for securities of comparable maturity, quality and type. Securities denominated in non-U.S. currencies are generally valued on the basis of bid quotations. Short-term securities with 60 days or less remaining to maturity are amortized to maturity based on their cost to the fund, if acquired within 60 days of maturity or, if already held by the fund on the 60th day, based on the value determined on the 61st day. The value of each security denominated in a currency other than U.S. dollars is translated into U.S. dollars at the prevailing market rate as provided by a pricing service in accordance with procedures established by the fund's officers. Forward currency contracts are valued at prices obtained from a pricing service. Stocks and convertible bonds are valued at closing sales prices reported on recognized securities exchanges on the day of valuation or, for listed stocks and convertible bonds having no sales reported and for unlisted stocks and convertible bonds, upon last-reported bid prices on that date. Securities traded in the over-the-counter market are valued at the last available sale prior to the time of valuation, or, lacking any sales, at the last reported bid price. Where pricing service or market quotations are not readily available, securities will be valued at fair value by the Board of Directors or a committee thereof. The maturities of variable or floating rate instruments are deemed to be the time remaining until the next interest rate adjustment date. As is customary in the mutual fund industry, securities transactions are accounted for on the date the securities are purchased or sold. In the event the fund purchases securities on a delayed-delivery or "when-issued" basis, it will segregate with its custodian liquid assets in an amount sufficient to meet its payment obligations in these transactions. Realized gains and losses from securities transactions are reported on an identified cost basis. Interest income is reported on the accrual basis. Discounts and premiums on securities purchased are amortized over the life of the respective securities. Dividends to shareholders are declared daily after determination of the fund's net asset value and paid to shareholders monthly. Investment securities and other assets and liabilities, including forward currency contracts, denominated in non-U.S. currencies are recorded in the financial statements after translation into U.S. dollars utilizing rates of exchange on the last business day of the period. Interest income from such investments is calculated using the approximate exchange rate as accrued or when received. Purchases and sales of investment securities, income and expenses are calculated at the rates of exchange prevailing on the respective dates of such transactions. The fund does not identify the portion of each amount shown in the fund's statement of operations under the caption "Realized Loss and Unrealized Depreciation on Investments" that arises from changes in non-U.S. currency exchange rates. Pursuant to the custodian agreement, the fund receives credit against its custodian fee for imputed interest on certain balances with the custodian bank. The custodian fee of $143,000 includes $19,000 that was paid by these credits rather than in cash. 2. It is the fund's policy to continue to comply with the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its net taxable income, including any net realized gain on investments, to its shareholders. Therefore, no federal income tax provision is required. As of June 30, 1996, net unrealized depreciation on investments, excluding forward currency contracts, for book and federal income tax purposes aggregated $46,766,000, of which $110,888,000 related to appreciated securities and $157,654,000 related to depreciated securities. During the period ended June 30, 1996, the fund realized, on a tax basis, a net capital loss of $2,551,000 on securities transactions. The fund has available at June 30, 1996 a net capital loss carryforward of $49,027,000 which may be used to offset capital gains realized during subsequent years through 2002 and thereby relieve the fund and its shareholders of any federal income tax liability with respect to the capital gains that are so offset. It is the intention of the fund not to make distributions from capital gains while there is a capital loss carryforward. The cost of portfolio securities, excluding foreign currency contracts, for book and federal income tax purposes was $6,474,281,000 at June 30, 1996. 3. The fee of $11,233,0000 for management services was paid pursuant to an agreement with Capital Research and Management Company (CRMC), with which certain officers and Directors of the fund are affiliated. The Investment Advisory and Service Agreement provides for monthly fees, accrued daily, based on an annual rate of 0.30% of the first $60 million of average net assets; 0.21% of such assets in excess of $60 million but not exceeding $1 billion; 0.18% of such assets in excess of $1 billion but not exceeding $3 billion; 0.16% of such assets in excess of $3 billion but not exceeding $6 billion; and 0.15% of such assets in excess of $6 billion; plus 3.00% on the first $450,000 of the fund's monthly gross investment income; 2.25% of such income in excess of $450,000 but not exceeding $833,333 million; and 2.00% of such income in excess of $833,333 million. Pursuant to a Plan of Distribution, the fund may expend up to 0.25% of its average net assets annually for any activities primarily intended to result in sales of fund shares, provided the categories of expenses for which reimbursement is made are approved by the fund's Board of Directors. Fund expenses under the Plan include payments to dealers to compensate them for their selling and servicing efforts. During the six months ended June 30, 1996, distribution expenses under the Plan were $7,901,000. As of June 30, 1996, accrued and unpaid distribution expenses were $945,000. American Funds Service Company (AFS), the transfer agent for the fund, was paid a fee of $2,427,000. American Funds Distributors, Inc. (AFD), the principal underwriter of the fund's shares, received $3,169,000 (after allowances to dealers) as its portion of the sales charges paid by purchasers of the fund's shares. Such sales charges are not an expense of the fund and, hence, are not reflected in the accompanying statement of operations. Directors who are unaffiliated with CRMC may elect to defer part or all of the fees earned for services as members of the Board. Amounts deferred are not funded and are general unsecured liabilities of the fund. As of June 30, 1996, aggregate amounts deferred and earnings thereon were $49,000. CRMC is owned by The Capital Group Companies, Inc. AFS and AFD are both wholly owned subsidiaries of CRMC. Certain of the Directors and officers of the fund are or may be considered to be affiliated with CRMC, AFS and AFD. No such persons received any remuneration directly from the fund 4. As of June 30, 1996, accumulated net realized loss on investments was $44,571,000 and paid-in capital was $6,072,924,000. The fund made purchases and sales of investment securities, excluding short-term securities, of $1,560,695,000 and $1,130,593,000, respectively, during the six months ended June 30, 1996. The fund purchases forward currency contracts in anticipation of, or to protect itself against, fluctuations in exchange rates. The contracts are recorded in the statement of assets and liabilities at their net unrealized value; the fund's maximum potential liability in these contracts is equal to the full contract amounts. Risks may arise upon entering these contracts from the potential inability of counterparties to meet the terms of their contracts and from the possible movements in foreign exchange rates and securities values underlying these instruments. Contract Amount U.S. Valuations at 6/30/96 ----------- ------------ --------------- ------------ Unrealized Appreciation Non-U.S. Currency Sales Contracts Non-U.S. U.S. Amount (Depreciation) Deutsche Marks expiring 7/19/96 to 1/8/97 DEM 49,366,000 $33,909,000 $32,806,000 $1,103,000 French Francs expiring 7/26/96 to 9/9/98 FRF 71,259,000 12,337,000 14,245,000 (1,908,000) Great Britain Pounds expiring 7/26/96 to 3/19/97 pound 2,250,000 3,413,000 3,494,000 (81,000) Swiss Francs expiring 7/26/96 CHF 312,000 255,000 250,000 5,000 ------------ -------------- ----------- $49,914,000 $50,795,000 ($881,000) ============ ============== ===========
Per-Share Data and Ratios Six Months Ended Year Ended December 31 06/30/96 /1/ 1995 1994 1993 1992 1991 Net asset value, beginning of period $13.88 $12.69 $14.45 $13.99 $13.70 $12.39 ---------- ---------- ---------- ---------- ---------- ---------- Income from investment operations: Net investment income 0.51 1.05 1.05 1.09 1.15 1.21 Net realized and unrealized gain(loss) on investments (0.44) 1.18 (1.76) 0.84 0.34 1.28 ---------- ---------- ---------- ---------- ---------- ---------- Total from investment operations 0.07 2.23 (0.71) 1.93 1.49 2.49 ---------- ---------- ---------- ---------- ---------- ---------- Less distributions: Dividends from net investment income (0.48) (1.04) (1.05) (1.08) (1.16) (1.18) Distributions from capital gains -- -- -- (0.39) (0.04) -- -- -- -- -- -- -- ---------- ---------- ---------- ---------- ---------- ---------- Total distributions (0.48) (1.04) (1.05) (1.47) (1.20) (1.18) ---------- ---------- ---------- ---------- ---------- ---------- Net asset value, end of period $13.47 $13.88 $12.69 $14.45 $13.99 $13.70 =========== ======================================================= Total Return /2/ 0.49% /2/ 18.25% (5.02%) 14.14% 11.34% 21.04% Ratios/supplemental data: Net assets, end of period (in millions) $6,484 $6,290 $4,941 $5,285 $3,917 $2,859 Ratio of expenses to average net assets .37% /3/ .74% .69% .71% .73% .77% Ratio of net income to average net assets 3.75% /3/ 7.87% 7.77% 7.53% 8.36% 9.28% Portfolio turnover rate 19.20% /3/ 43.80% 56.98% 44.68% 49.70% 56.47% /1/ Unaudited /2/ Calculated without deducting a sales charge. The maximum sales charge is 4.75% of the fund's offering price. /3/ Based on the period shown and, accordingly, are not representative of a full year's operations.
OFFICES OF THE FUND AND OF THE INVESTMENT ADVISER, CAPITAL RESEARCH AND MANAGEMENT COMPANY 333 South Hope Street Los Angeles, California 90071-1443 135 South State College Boulevard Brea, California 92821-5804 TRANSFER AGENT FOR SHAREHOLDER ACCOUNTS American Funds Service Company (Please write to the address closest to you.) P.O. Box 2205 Brea, California 92822-2205 P.O. Box 659522 San Antonio, Texas 78265-9522 P.O. Box 6007 Indianapolis, Indiana 46206-6007 P.O. Box 2280 Norfolk, Virginia 23501-2280 CUSTODIAN OF ASSETS The Chase Manhattan Bank, N.A. One Chase Manhattan Plaza New York, New York 10081-0001 COUNSEL Morrison & Foerster LLP 345 California Street San Francisco, California 94104-2675 PRINCIPAL UNDERWRITER American Funds Distributors, Inc. 333 South Hope Street Los Angeles, California 90071-1462 For information about your account or any of the fund's services, please contact your financial adviser or call American Funds Service Company, toll-free, at 800/421-0180. This report is for the information of shareholders of The Bond Fund of America, but it may also be used as sales literature when preceded or accompanied by the current prospectus, which gives details about charges, expenses, investment objectives and operating policies of the fund. If used as sales material after September 30, 1996, this report must be accompanied by an American Funds Group Statistical Update for the most recently completed calendar quarter. Litho in USA CD/AL/3031 Lit. No. BFA-013-0896 Printed on recycled paper [The American Funds Group(R)] -----END PRIVACY-ENHANCED MESSAGE-----