-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, KQZE1/yhBDotLgASrOjYLxoHPzrSSNi6Rkh6POfF3bGj9quAApm/60ZZJfeOR0q1 J3PXJCRe2zJn5zpktDkJIA== 0000797923-94-000006.txt : 19940707 0000797923-94-000006.hdr.sgml : 19940707 ACCESSION NUMBER: 0000797923-94-000006 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19940430 FILED AS OF DATE: 19940627 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PREMIER MUNICIPAL BOND FUND CENTRAL INDEX KEY: 0000797923 STANDARD INDUSTRIAL CLASSIFICATION: 0000 STATE OF INCORPORATION: NY FISCAL YEAR END: 0430 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-04764 FILM NUMBER: 94535872 BUSINESS ADDRESS: STREET 1: 144 GLENN CURTISS BLVD CITY: UNIONDALE STATE: NY ZIP: 11556 BUSINESS PHONE: 2129226805 MAIL ADDRESS: STREET 1: C/O DREYFUS CORP STREET 2: 200 PARK AVENUE, 8TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10166 FORMER COMPANY: FORMER CONFORMED NAME: PREMIER TAX EXEMPT BOND FUND DATE OF NAME CHANGE: 19900916 FORMER COMPANY: FORMER CONFORMED NAME: GARDEN CITY TAX EXEMPT BOND FUND DATE OF NAME CHANGE: 19860910 N-30D 1 ANNUAL REPORT PERFORMANCE COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN PREMIER MUNICIPAL BOND FUND CLASS A SHARES AND THE LEHMAN BROTHERS MUNICIPAL BOND INDEX (Exhibit A) *Source: Lehman Brothers
AVERAGE ANNUAL TOTAL RETURN CLASS A CLASS B -------------------------------------- --------------------------------------------------- % Return Reflecting % Return Applicable Contingent Reflecting % Return Deferred Sales % Return Without Maximum Initial Assuming No Charge Upon PERIODS ENDED 4/30/94 SALES CHARGE SALES CHARGE (4.5%) PERIODS ENDED 4/30/94 REDEMPTION REDEMPTION* - - --------------------- ----------- ------------------- -------------------- ---------- ------------ 1 Year 1.84% (2.73)% 1 Year 1.26% (1.61)% 5 Year 8.92 7.93 From Inception (1/15/93) 4.71 2.45 From Inception (11/26/86) 7.52 6.86
Past performance is not predictive of future performance. Share price and investment return fluctuate and share price may be more or less than original cost upon redemption. The above graph compares a $10,000 investment made in Class A shares of Premier Municipal Bond Fund on 11/26/86 (Inception Date) to a $10,000 investment made in the Lehman Brothers Municipal Bond Index on that date. For comparative purposes, the value of the Index on 11/30/86 is used as the beginning value on 11/26/86. All dividends and capital gain distributions are reinvested. Performance for Class B shares will differ from the results shown above due to difference in charges and expenses charged to that class. The Fund invests primarily in municipal securities and its performance shown in the graph takes into account the maximum initial sales charge on Class A shares and all other applicable fees and expenses. Unlike the Fund, the Lehman Brothers Municipal Bond Index is an unmanaged total return performance benchmark for the long-term, investment grade tax exempt bond market, calculated by using municipal bonds selected to be representative of the market. The Index does not take into account charges, fees and other expenses. Further information relating to Fund performance, including expense reimbursements, if applicable, is contained in the Condensed Financial Information section of the Prospectus and elsewhere in this report. * Maximum contingent deferred sale charge for Class B shares is 3% and is reduced to 0% after five years. PRESIDENT'S LETTER Dear Shareholder: As the annual reporting period for the Premier Municipal Bond Fund came to a close on April 30, 1994, the net asset value per share of Class A shares was $13.81, a decrease of approximately $.59 from the net asset value per share on April 30, 1993, adjusted for capital gain distributions. The net asset value per share for Class B shares was $13.81, a decrease of approximately $.59 from the net asset value per share on April 30, 1993, adjusted for capital gain distributions. During the reporting period, tax exempt dividends of approximately $.89 per share were paid by Class A shares, representing a distribution rate per share of 6.11%, based on the April 30, 1994 closing maximum offering price, adjusted for capital gain distributions. During the reporting period, tax exempt dividends of approximately $.80 per share were paid by Class B shares, representing a distribution rate per share of 5.79%, based on the April 30, 1994 closing net asset value per share, adjusted for capital gain distributions. We are pleased to inform you that all dividends paid from net investment income were exempt from Federal income tax.* The Federal Reserve Board's actions to slow the rate of economic growth slightly, thereby forming a strategy to fight inflation in the future, caused the stock and bond markets to fall sharply in the first quarter of 1994. The Federal Reserve can stimulate or rein in the economy by lowering or increasing short-term interest rates, as it did with quarter point increases in its target for Federal Funds. The Federal Funds rate is the rate that banks charge each other for overnight loans and is currently adjusted to 4.0%. It is the main interest rate the Federal Reserve is using to influence economic activity, and it was increased four times. These increases were the first in five years, and at the time, the financial markets interpreted these moves as a sign that the Federal Reserve perceived incipient inflation that had eluded, or was contrary to, the views of many private economists and investors. Federal Reserve officials refuse to say precisely how much higher the Federal Funds target would have to be to bring down the nation's borrowing and spending so that the economy will grow at a rate that is considered neutral. A neutral growth rate is defined as the fastest rate possible without feeding inflation, and is believed to be the rate of growth equal to the economy's underlying capacity to produce goods and services. Currently, most economists think that rate is around 3%. Using unused factories and unemployed workers, it would be possible to temporarily grow faster the rate of total productive capacity. However, once the economy is operating at or near full capacity and full employment, inflation could pick up, demonstrated by rising prices for finished goods and by companies bidding up wages and prices for factory goods. The Federal Reserve is concerned with such an occurrence and is signaling that more increases in short-term rates could be on the way. If these increases materialize, they should slow economic growth, as companies and individuals pay more interest on their loans and mortgages and preempt an inflationary condition as a result. More immediately for investors, the Federal Reserve's stance means that those who have been weathering declining markets in the last few months may not be able to find comfort even if monthly inflation reports continue to show that current price increases are moderate, as was indicated by the latest round of figures. In the market, the prices of most Treasury, corporate and municipal securities have fallen and so have the net asset values of most fixed-income mutual funds. However, we believe the underlying fundamentals for municipals remain solid in spite of the potential negative tone of the overall bond market that could push yields higher. The overwhelming positive factor for tax exempts is limited new supply. Through April, gross issuance was 34% below the comparable period last year. Additionally, in June and July, a large amount of municipal bond investment will be returned to investors due to calls, refinancings and maturities. If much of these proceeds is reinvested into the market, it should provide the market with potential support. If this occurs, we think this can help provide a setting for municipals to be a strong relative performing sector within the fixed-income markets. During the first half of its fiscal year, the Funds total return benefited from the strong performance of the municipal market. Declining interest rates, an accommodative Federal Reserve Board policy, low price volatility, and a lackluster economy drove the municipal market to higher price valuations. However, as the economy began to pick up steam during the fourth quarter of 1993 and into the new year, a change in Federal Reserve policy and rising interest rates had a negative impact on the municipal market . Last year, when rates were reaching their cyclical lows, we altered our security selection strategy. Specifically, we elected not to chase the market, and began to conduct our business somewhat more defensively. While these actions limited performance during that period in 1993 when rates were still declining, they positioned the Fund more advantageously for the market decline which has occurred so far this year. As we stated in our previous report to shareholders, it was our intention to adopt a more defensive portfolio posture in order to reduce the volatility of the portfolio. In response, we reduced the Funds exposure to those bonds in the portfolio with the longest durations (price sensitivities) while maintaining the more defensive securities (i.e., pre-refunded bonds), and started building higher cash reserves. We still believe that a more defensive stance currently is warranted in view of the heightened degree of uncertainty about the near-term direction of the economy and inflation. Certainly, recent moves by the Federal Reserve to hike short-term interest rates provide enough of an impetus to maintain a cautious stance. The Federal Reserve generally act s in a series of moves rather than taking a one shot approach. While we increased our cash reserves, which are invested in tax exempt cash equivalent securities, in seeking to lessen the impact of rising rates on the Fund, we are reluctant to keep too much cash on hand. As mentioned previously, higher interest rates have severely curtailed the volume of new municipal securities so we have some concern about the potential periodic shortage of tax exempts if the financial markets stabilize and investors increase their level of purchases. Higher tax rates and the large number of bonds being retired currently lead us to believe that the potential demand for tax exempt securities is substantial, especially in those States with the highest tax structures. We have included a current statement of investments and recent financial statements for your review. We look forward to serving your investment needs in the future. Very truly yours, (Richard J. Moynihan Signature Logo) Richard J. Moynihan President May 24, 1994 New York, N.Y. *Some income may be subject to state and local taxes, and for certain investors, the Federal Alternative Minimum Tax.
PREMIER MUNICIPAL BOND FUND STATEMENT OF INVESTMENTS APRIL 30, 1994 PRINCIPAL MUNICIPAL BONDS-98.1% AMOUNT VALUE ------------- ------------- ALABAMA-1.3% Courtland Industrial Development Board, SWDR (Champion International Corp. Project) 6.375%, 3/1/2029........................................................ $ 8,700,000 $ 8,023,227 ARIZONA-1.5% Maricopa County Pollution Control Corp., PCR, Refunding (Public Service Co. - Palo Verde) 6.375%, 8/15/2023..................... 7,000,000 6,243,650 Tucson Airport Authority, Inc., Special Facility Revenue (Lockheed Aermod Center, Inc.) 8.70%, 9/1/2019.......................... 2,500,000 2,839,150 COLORADO-7.2% City and County of Denver, Airport Revenue: 7.75%, 11/15/2021....................................................... 8,000,000 8,075,600 7.25%, 11/15/2023....................................................... 10,000,000 9,613,300 7%, 11/15/2025.......................................................... 18,225,000 16,965,288 Colorado Health Facilities Authority, Retirement Facilities Revenue (Liberty Heights) Zero Coupon, 7/15/2024................................ 10,000,000 1,129,600 Dawson Ridge, Metropolitan District Number 1, Refunding: Zero Coupon, 10/1/2017.................................................. 9,930,000 2,050,247 Zero Coupon, 10/1/2022.................................................. 47,535,000 7,008,560 CONNECTICUT-2.9% Connecticut Development Authority, First Mortgage Gross Revenue (Elim Park Baptist Home, Inc. Project) 9%, 12/1/2020.................... 3,000,000 3,189,810 Connecticut Health and Educational Facilities Authority, Revenue (Sacred Heart University) 5.80%, 7/1/2023............................... 1,700,000 1,478,303 Connecticut Housing Finance Authority (Housing Mortgage Finance Program) 6.70%, 11/15/2022....................................................... 13,000,000 13,126,490 FLORIDA-1.9% Lake County Resources Recreation, IDR, Refunding (NRG/Recovery Group) 5.85%, 10/1/2009........................................................ 5,750,000 5,314,610 Palm Beach County, Solid Waste IDR (Okeelanta Power LP Project) 6.85%, 2/15/2021........................................................ 6,750,000 6,299,302 GEORGIA-1.4% Atlanta, Airport Facilities, Refunding 7.25%, 1/1/2017...................... 5,000,000 5,302,750 Hogansville, Combined Public Utility System Revenue, Refunding (Asset Guaranty) 6%, 10/1/2023........................................................... 3,475,000 3,279,288 ILLINOIS-12.3% Alton, Health Facilities Revenue (Barnes-Jewish, Inc. Christian) 5.50%, 5/15/2021 7,000,000 6,113,730 Chicago O'Hare International Airport, Special Facility Revenue: (American Airlines, Inc. Project) 7.875%, 11/1/2025..................... 6,000,000 6,202,200 (United Airlines, Inc.): 8.20%, 5/1/2018....................................................... 2,195,000 2,346,455 8.50%, 5/1/2018....................................................... 3,500,000 3,748,430 East Chicago, PCR, Refunding (Inland Steel Co. Project Number 10) 6.80%, 6/1/2013 9,000,000 8,566,110 PREMIER MUNICIPAL BOND FUND STATEMENT OF INVESTMENTS (CONTINUED) APRIL 30, 1994 PRINCIPAL MUNICIPAL BONDS (CONTINUED) AMOUNT VALUE ------------- ------------- ILLINOIS (CONTINUED) Illinois Development Finance Authority, Revenue: (Community Rehabilitation Providers Facility): 8.75%, 3/1/2010....................................................... $ 2,725,000 $ 2,937,359 8.50%, 9/1/2010....................................................... 4,535,000 4,887,642 8.25%, 8/1/2012....................................................... 4,380,000 4,464,359 Retirement Housing (Regency Park) Zero Coupon, 7/15/2023................ 85,000,000 10,319,850 Illinois Health Facilities Authority, Revenue: (Beverly Farm Foundation) 9.125%, 12/15/2015............................ 2,000,000 2,165,780 (Delnor Community Hospital Project) 8%, 5/15/2019 (Prerefunded 5/15/1999) (a) 5,500,000 6,299,920 (Refunding - Masonic Medical Center) 5.50%, 10/1/2019 .................. 5,000,000 4,197,350 (Trinity Medical Center) 7%, 7/1/2012................................... 6,750,000 6,782,400 Illinois Housing Development Authority, Multi-Family Program 6.75%, 9/1/2021. 7,350,000 7,393,953 INDIANA-1.2% Indianapolis Local Public Improvement Bond Bank, Refunding 6.75%, 2/1/2020.. 7,500,000 7,473,825 IOWA-1.5% Council Bluffs, PCR, Refunding (Midwest Power Systems, Inc.) 5.95%, 5/1/2023. 10,000,000 9,237,300 LOUISIANA-4.1% Lake Charles Non-Profit Housing Development Corp., First Mortgage Revenue, Refunding (Chateau Project) 7.875%, 2/15/2025 (Insured; FHA)............ 1,000,000 1,005,070 Louisiana Public Facilities Authority, Revenue (Student Loan) 7%, 9/1/2006.. 3,000,000 3,081,720 Parish of Saint Charles, PCR (Louisiana Power and Light Co. Project) 7.50%, 6/1/2021......................................................... 3,750,000 3,894,900 Parish of West Feliciana, PCR: (Gulf States Utilities - II) 7.70%, 12/1/2014........................... 10,000,000 10,677,800 (Gulf States Utilities - III) 7.70%, 12/1/2014.......................... 6,500,000 6,925,425 MARYLAND-.3% Maryland Community Development Administration, Department of Housing and Community Development (Single Family Program) 7.70%, 4/1/2015........... 2,085,000 2,195,693 MASSACHUSETTS-1.6% Massachusetts Health and Educational Facilities Authority, Revenue (Tufts University) 8.25%, 8/15/2018 (b)................................. 4,000,000 3,517,600 Massachusetts Housing Finance Agency, SFHR 7.95%, 6/1/2023.................. 2,000,000 2,089,300 New England Education Loan Marketing Corp., Student Loan Revenue 6.90%, 11/1/2009........................................................ 4,000,000 4,127,120 MICHIGAN-4.4% Detroit, Sewer Disposal Revenue 8.33%, 7/1/2023 (Insured; FGIC) (b)......... 7,500,000 6,375,000 Greater Detroit Resources Recovery Authority, Revenue: 9.25%, Series A, 12/13/2008............................................. 8,440,000 9,019,490 9.25%, Series D, 12/13/2008............................................. 250,000 267,165 9.25%, Series E, 12/13/2008............................................. 1,000,000 1,068,660 9.25%, Series H, 12/13/2008............................................. 2,045,000 2,185,410 Michigan Hospital Finance Authority, Revenue, Refunding (Detroit Medical Center) 6.50%, 8/15/2018........................................................ 5,000,000 4,886,050 PREMIER MUNICIPAL BOND FUND STATEMENT OF INVESTMENTS (CONTINUED) APRIL 30, 1994 PRINCIPAL MUNICIPAL BONDS (CONTINUED) AMOUNT VALUE ------------- ------------- MICHIGAN (CONTINUED) Wayne County Building Authority 8%, 3/1/2017................................ $ 1,500,000 $ 1,754,580 Western Townships Utilities Authority, Sewer Disposal System (Limited Tax) 8.20%, 1/1/2018......................................................... 1,500,000 1,682,970 MISSISSIPPI-.3% Medical Center Educational Building Corp., Revenue (University Medical Center Project) 5.90%, 12/1/2023.................... 2,250,000 2,115,967 NEBRASKA-2.0% Nebraska Higher Education Loan Program, Inc., Revenue 6.40%, 6/1/2013....... 12,500,000 12,533,250 NEVADA-4.0% Clark County, IDR (Southwest Gas Corp.): 7.50%, 9/1/2032......................................................... 13,000,000 13,307,450 6.50%, 12/1/2033........................................................ 13,000,000 11,703,380 NEW HAMPSHIRE-.6% New Hampshire Housing Finance Authority, Single Family Residential Mortgage 7.70%, 7/1/2029......................................................... 3,675,000 3,818,546 NEW JERSEY-2.8% Camden County Pollution Control Financing Authority, Solid Waste RRR 7.50%, 12/1/2010........................................................ 2,000,000 2,051,980 New Jersey Economic Development Authority, First Mortgage Gross Revenue (The Evergreens) 9.25%, 10/1/2022....................................... 15,000,000 15,630,300 NEW MEXICO-.3% New Mexico Educational Assistance Foundation, Student Loan Revenue 6.85%, 12/1/2005........................................................ 2,000,000 2,028,380 NEW YORK-17.7% Metropolitan Transportation Authority, Service Contract, Commuter Facilities 7.50%, 7/1/2016 (Prerefunded 7/1/2000) (a).............................. 3,000,000 3,425,970 New York City: 8%, 6/1/2000............................................................ 2,200,000 2,473,900 7.50%, 2/1/2001......................................................... 5,000,000 5,509,750 6%, 5/15/2008........................................................... 8,970,000 8,768,893 7.50%, 8/15/2008........................................................ 2,000,000 2,152,660 7.10%, 2/1/2009......................................................... 5,000,000 5,330,900 6%, 5/15/2009........................................................... 5,000,000 4,853,950 7%, 2/1/2020............................................................ 12,000,000 12,547,920 Refunding 5.70%, 8/1/2009............................................... 3,450,000 3,241,413 New York City Industrial Development Agency, Special Facilities Revenue (American Airlines, Inc. Project) 8%, 7/1/2020.......................... 3,250,000 3,412,402 New York City Municipal Water Finance Authority, Water and Sewer Systems Revenue: 7%, 6/15/2001........................................................... 2,490,000 2,779,039 7.375%, 6/15/2009 (Prerefunded 6/15/1999) (a)........................... 4,000,000 4,450,160 7%, 6/15/2015 (Prerefunded 6/15/2001) (a)............................... 2,510,000 2,623,402 New York State Dormitory Authority, Revenue: City University Systems 7.625%, 7/1/2020 (Prerefunded 7/1/2000) (a)..... 4,000,000 4,594,160 State University Educational Facilities 7%, 5/15/2018 (Prerefunded 5/15/2000) (a) 3,295,000 3,671,658 PREMIER MUNICIPAL BOND FUND STATEMENT OF INVESTMENTS (CONTINUED) APRIL 30, 1994 PRINCIPAL MUNICIPAL BONDS (CONTINUED) AMOUNT VALUE ------------- ------------- NEW YORK (CONTINUED) New York State Dormitory Authority, Revenue (continued): Upstate Community Colleges: 5.25%, 7/1/2005....................................................... $ 1,770,000 $ 1,671,800 5.375%, 7/1/2006...................................................... 1,995,000 1,893,514 New York State Energy Research and Development Authority, Electric Facilities Revenue: (Consolidated Edison Co. of New York, Inc.): 7.50%, 7/1/2025................................................... 3,000,000 3,219,300 7.50%, 1/1/2026................................................... 2,000,000 2,138,600 (Long Island Lighting Co.) 7.15%, 6/1/2020............................ 4,000,000 4,073,920 New York State Housing Finance Agency, Revenue: (Refunding - Health Facilities - New York City) 8%, 11/1/2008........... 5,000,000 5,586,150 Service Contract Obligation 7.30%, 3/15/2021 (Prerefunded 9/15/2001) (a) 5,000,000 5,684,800 New York State Local Government Assistance Corp. 7%, 4/1/2016 (Prerefunded 4/1/2001) (a)................................. 5,500,000 6,156,370 New York State Medical Care Facilities Finance Agency, Revenue 6.622%, 8/15/2006 (Insured; FSA) (b,c).................................. 8,300,000 7,075,750 (Mental Health Service Facilities Improvement): 7.875%, 8/15/2020..................................................... 1,335,000 1,477,151 Refunding 7.875%, 8/15/2000 (Prerefunded 8/15/2000) (a)............... 1,150,000 1,330,527 NORTH CAROLINA-1.1% North Carolina Eastern Municipal Power Agency, Power System Revenue 8.397%, 1/1/2019 (b,c).................................................. 8,400,000 7,182,000 OHIO-.6% Gateway Economic Development Corp., Greater Cleveland Excise Tax Revenue 7.50%, 9/1/2005......................................................... 3,500,000 3,852,905 OKLAHOMA-.7% Tulsa Municipal Airport Trust, Revenue (American Airlines, Inc.) 7.375%, 12/1/2020 4,300,000 4,326,746 PENNSYLVANIA-6.2% Blair County Hospital Authority, Revenue (Altoona Hospital) 8.46%, 7/1/2013 (b) 5,000,000 5,124,850 Lancaster County Hospital Authority, Revenue (Health Center - United Church Homes Project) 9.125%, 10/1/2014........................................ 1,465,000 1,618,722 Lehigh County General Purpose Authority, Revenue (Wiley House): 8.75%, 11/1/2014........................................................ 2,000,000 2,000,000 9.50%, 11/1/2016........................................................ 3,000,000 3,085,470 Montgomery County Higher Education and Health Authority, Revenue (AHF/Montgomery, Inc. Project) 10.50%, 9/1/2020......................... 3,500,000 3,757,600 Pennsylvania Economic Development Financing Authority, RRR (Northampton Generating - A): 6.40%, 1/1/2009....................................................... 2,500,000 2,371,600 6.50%, 1/1/2013....................................................... 3,500,000 3,280,795 Pennsylvania Intergovernmental Cooperative Authority, Special Tax Revenue (Philadelphia Funding Program) 6.80%, 6/15/2022 (Prerefunded 6/15/2002) (a) 5,500,000 6,023,655 Philadelphia, Water and Sewer Revenue 7.35%, 9/1/2004....................... 4,980,000 5,564,403 PREMIER MUNICIPAL BOND FUND STATEMENT OF INVESTMENTS (CONTINUED) APRIL 30, 1994 PRINCIPAL MUNICIPAL BONDS (CONTINUED) AMOUNT VALUE ------------- ------------- PENNSYLVANIA (CONTINUED) Philadelphia Hospital and Higher Education Facility Authority, HR (Graduate Health Systems) 7.25%, 7/1/2018............................... $ 6,100,000 $ 6,172,773 RHODE ISLAND-.4% Rhode Island Depositors Economic Protection Corp., Special Obligation 6.95%, 8/1/2022 (Prerefunded 8/1/2002) (a).............................. 2,000,000 2,232,840 TENNESSEE-1.6% McMinn County Industrial Development Board, PCR (Calhoun Newsprint Co. Project) 7.625%, 3/1/2016........................ 3,000,000 3,150,180 Metropolitan Government of Nashville and Davidson County, IDB, Revenue (Refunding - Multi-Family Mortgage - Picadilly) 6.95%, 7/1/2027 (Insured; FHA) 6,705,000 6,898,238 TEXAS-9.3% Alliance Airport Authority, Inc., Special Facilities Revenue (American Airlines, Inc. Project): 7%, 12/1/2011......................................................... 10,700,000 10,566,678 7.50%, 12/1/2029...................................................... 6,000,000 6,058,020 Brazos Higher Education Authority, Inc., Student Loan Revenue, Refunding 5.875%, 6/1/2004........................................................ 6,000,000 5,921,160 Brazos River Authority, PCR (Collateralized, Texas Utilities Electric Co. Project) 7.875%, 3/1/2021........................................................ 490,000 528,499 Dallas - Fort Worth International Airport Facility Improvement Corp., Revenue (American Airlines, Inc.) 7.50%, 11/1/2025.............................. 13,000,000 13,126,230 Gulf Coast Waste Disposal Authority, Revenue (Champion International Corp.) 7.45%, 5/1/2026......................................................... 7,000,000 7,283,150 Port Corpus Christi Authority, PCR, Refunding (Hoechst Celanese Co. Project) 7.50%, 8/1/2012......................................................... 4,000,000 4,351,960 Texas Housing Agency, SFMR 7.875%, 9/1/2012................................. 985,000 1,012,176 Texas Public Property Finance Corp., Revenue (Mental Health and Retardation Center) 8.20%, 10/1/2012 (Prerefunded 10/1/2002) (a)............................ 9,075,000 9,392,625 UTAH-3.3% Carbon County, SWDR, Refunding: (East Carbon Development Corp.) 9%, 7/1/2012............................ 4,000,000 4,188,680 (Sunnyside Cogeneration) 9.25%, 7/1/2018................................ 15,000,000 16,113,600 VIRGINIA-.8% Albemarle County Industrial Development Authority, HR, Refunding (Martha Jefferson Hospital) 5.875%, 10/1/2013........................... 2,360,000 2,238,248 Virginia Housing Development Authority, Commonwealth Mortgage 6.20%, 7/1/2021 3,255,000 3,081,346 WASHINGTON-1.4% Pierce County Economic Development Corp., Revenue (Solid Waste - Occidental Petrol) 5.80%, 9/1/2029......................................................... 6,750,000 5,905,778 Pilchuck Development Public Corp., Revenue, Refunding (Industrial - Little Neck Properties Project) 6.25%, 8/1/2010 (LOC; US Bank of Washington) (d).... 3,090,000 3,049,336 PREMIER MUNICIPAL BOND FUND STATEMENT OF INVESTMENTS (CONTINUED) APRIL 30, 1994 PRINCIPAL MUNICIPAL BONDS (CONTINUED) AMOUNT VALUE ------------- ------------- WEST VIRGINIA-1.6% West Virginia Parkways Economic Development and Tourism Authority: 7.380%, 5/15/2013 (b)................................................... $ 5,000,000 $ 4,198,550 8.595%, 5/16/2019 (Insured; FGIC) (b)................................... 4,000,000 3,530,000 West Virginia Water Development Authority, Water Development Revenue (Loan Program II) 7.50%, 11/1/2029 (Prerefunded 11/1/1999) (a).......... 1,900,000 2,146,183 WYOMING-.6% Wyoming Community Development Authority, Single Family Mortgage 8%, 6/1/2021. 3,600,000 3,740,652 U.S. RELATED-1.2% Guam Government 5.40%, 11/15/2018........................................... 3,775,000 3,249,897 Puerto Rico Commonwealth, Refunding 5.50%, 7/1/2013......................... 5,000,000 4,544,450 ------------- TOTAL MUNICIPAL BONDS (cost $606,166,272)................................... $612,033,098 ------------- ------------- CONTRACTS SUBJECT TO PUT OPTIONS-.1% PUT ------------- U.S. Treasury Notes: June '94 @ $108......................................................... 100 $ 278,125 June '94 @ $109......................................................... 100 373,438 -------------- TOTAL PUT OPTIONS (cost $334,537)........................................... $ 651,563 -------------- -------------- PRINCIPAL SHORT-TERM MUNICIPAL INVESTMENT-1.8% AMOUNT ------------- FLORIDA; Orange County Health Facilities Authority, Revenue, VRDN (Adventist Health Systems/Sunbelt) 3.20% (LOC; Banque Paribas) (d,e) (cost $11,000,000)...................................................... $ 11,000,000 $ 11,000,000 ------------- ------------- TOTAL INVESTMENTS-100.0% (cost $617,500,809)..................................................... $623,684,661 ------------- -------------
PREMIER MUNICIPAL BOND FUND SUMMARY OF ABBREVIATIONS FGIC Financial Guaranty Insurance Corporation PCR Pollution Control Revenue FHA Federal Housing Administration RRR Resource Recovery Revenue FSA Financial Security Assurance SFHR Single Family Housing Revenue HR Hospital Revenue SFMR Single Family Mortgage Revenue IDB Industrial Development Board SWDR Solid Waste Disposal Revenue IDR Industrial Development Revenue VRDN Variable Rate Demand Notes LOC Letter of Credit
SUMMARY OF COMBINED RATINGS (UNAUDITED) FITCH (F) OR MOODY'S OR STANDARD & POOR'S PERCENTAGE OF VALUE - - --------- --------- -------------------- ---------------------- AAA Aaa AAA 15.9% AA Aa AA 9.5 A A A 22.5 BBB Baa BBB 34.2 BB Ba BB 2.4 F-1 MIGI, VMIG1 & P1 SP1 & A1 1.8 Not Rated (g) Not Rated (g) Not Rated (g) 13.7 -------- 100.0% -------- --------
NOTES TO STATEMENT OF INVESTMENTS: (a) Bonds which are prerefunded are collateralized by U.S. Government securities which are held in escrow and are used to pay principal and interest on the tax-exempt issue and to retire the bonds in full at the earliest refunding date. (b) Residual interest security - the interest rate is subject to change periodically. (c) Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. At April 30, 1994, these securities amounted to $14,257,750 or 2.2% of net assets. (d) Secured by letters of credit. (e) Securities payable on demand. The interest rate, which is subject to change, is based on bank prime rates or an index of market interest rates. (f) Fitch currently provides creditworthiness information for a limited amount of investments. (g) Securities which, while not rated by Fitch, Moody's or Standard & Poor's, have been determined by the Fund's Board of Trustees to be of comparable quality to those rated securities in which the Fund may invest.
STATEMENT OF PUT OPTIONS WRITTEN APRIL 30, 1994 CONTRACTS SUBJECT TO ISSUER PUT VALUE - - ------ ---------- --------- U.S. Treasury Notes: June '94 @ $106......................................................... 200 $(250,000) June '94 @ $107......................................................... 200 (387,500) --------- (premiums received $296,552).......................................... $(637,500) --------- --------- See notes to financial statements. PREMIER MUNICIPAL BOND FUND STATEMENT OF ASSETS AND LIABILITIES APRIL 30, 1994 ASSETS: Investments in securities, at value (cost $617,500,809)-see statement..................................... $623,684,661 Cash.................................................................... 4,099,668 Interest receivable..................................................... 14,134,626 Receivable for shares of Beneficial Interest subscribed................. 1,393,285 Prepaid expenses........................................................ 52,308 -------------- 643,364,548 LIABILITIES: Due to The Dreyfus Corporation.......................................... $460,521 Outstanding put options written, at value (premiums received $296,552)-see statement............................ 637,500 Payable for shares of Beneficial Interest redeemed...................... 398,614 Accrued expenses........................................................ 188,279 1,684,914 ---------- -------------- NET ASSETS ................................................................ $641,679,634 -------------- -------------- REPRESENTED BY: Paid-in capital......................................................... $637,350,126 Accumulated net realized capital losses and distributions in excess of net realized gain on investments-Note 1(c)......................................... (1,513,396) Accumulated net unrealized appreciation on investments-Note 3(b)........ 5,842,904 -------------- NET ASSETS at value......................................................... $641,679,634 -------------- -------------- Shares of Beneficial Interest outstanding: Class A Shares (unlimited number of $.001 par value shares authorized)............... 39,544,149 -------------- -------------- Class B Shares (unlimited number of $.001 par value shares authorized)............... 6,924,450 -------------- -------------- NET ASSET VALUE per share: Class A Shares ($546,036,245 / 39,544,149 shares).................................... $13.81 ------- ------- Class B Shares ($95,643,389 / 6,924,450 shares)...................................... $13.81 ------- ------- See notes to financial statements. PREMIER MUNICIPAL BOND FUND STATEMENT OF OPERATIONS YEAR ENDED APRIL 30, 1994 INVESTMENT INCOME: INTEREST INCOME......................................................... $ 43,891,883 EXPENSES: Management fee-Note 2(a).............................................. $ 3,526,429 Shareholder servicing costs-Note 2(c)................................. 1,962,965 Distribution fees (Class B shares)-Note 2(b).......................... 324,814 Registration fees..................................................... 109,195 Prospectus and shareholders' reports.................................. 79,905 Custodian fees........................................................ 59,319 Professional fees..................................................... 55,345 Trustees' fees and expenses-Note 2(d)................................. 18,941 Miscellaneous......................................................... 48,901 ------------- 6,185,814 Less-reduction in management fee due to undertakings-Note 2(a)............................................ 399,146 ------------- TOTAL EXPENSES.................................................. 5,786,668 ------------- INVESTMENT INCOME-NET........................................... 38,105,215 REALIZED AND UNREALIZED (LOSS) ON INVESTMENTS: Net realized (loss) on investments-Note 3(a)............................ $ (1,468,275) Net unrealized (depreciation) on investments............................ (29,828,947) ------------- NET REALIZED AND UNREALIZED (LOSS) ON INVESTMENTS............... (31,297,222) ------------- NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........................ $ 6,807,993 ------------- ------------- See notes to financial statements. PREMIER MUNICIPAL BOND FUND STATEMENT OF CHANGES IN NET ASSETS YEAR ENDED APRIL 30, -------------------------------- 1993 1994 --------------- ------------- OPERATIONS: Investment income-net................................................... $ 29,484,374 $ 38,105,215 Net realized gain (loss) on investments................................. 5,305,331 (1,468,275) Net unrealized appreciation (depreciation) on investments for the year.. 23,331,904 (29,828,947) --------------- ------------- NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS.............. 58,121,609 6,807,993 --------------- ------------- DIVIDENDS TO SHAREHOLDERS FROM: Investment income-net: Class A shares........................................................ (29,366,677) (34,640,947) Class B shares........................................................ (117,697) (3,464,268) Net realized gain on investments: Class A shares........................................................ (6,801,408) (1,935,559) Class B shares........................................................ --- (249,175) Excess net realized gain on investments: Class A shares........................................................ --- (39,975) Class B shares........................................................ --- (5,146) --------------- ------------- TOTAL DIVIDENDS................................................... (36,285,782) (40,335,070) --------------- ------------- BENEFICIAL INTEREST TRANSACTIONS: Net proceeds from shares sold: Class A shares........................................................ 148,668,994 104,748,904 Class B shares........................................................ 19,857,135 83,821,633 Dividends reinvested: Class A shares........................................................ 22,354,888 22,085,600 Class B shares........................................................ 64,777 2,282,208 Cost of shares redeemed: Class A shares........................................................ (55,003,691) (80,102,730) Class B shares........................................................ (109,103) (4,090,771) --------------- ------------- INCREASE IN NET ASSETS FROM BENEFICIAL INTEREST TRANSACTIONS...... 135,833,000 128,744,844 --------------- ------------- TOTAL INCREASE IN NET ASSETS.................................... 157,668,827 95,217,767 NET ASSETS: Beginning of year....................................................... 388,793,040 546,461,867 --------------- ------------- End of year............................................................. $546,461,867 $641,679,634 --------------- ------------- --------------- -------------
SHARES ---------------------------------------------------------------------------- CLASS A CLASS B ---------------------------------- ---------------------------------- YEAR ENDED APRIL 30, YEAR ENDED APRIL 30, ---------------------------------- ---------------------------------- 1993 1994 1993* 1994 --------------- --------------- --------------- --------------- CAPITAL SHARE TRANSACTIONS: Shares sold......................... 10,464,001 7,100,350 1,376,724 5,676,601 Shares issued for dividends reinvested 1,577,117 1,502,278 4,490 155,727 Shares redeemed..................... (3,868,910) (5,500,645) (7,565) (281,527) --------------- --------------- --------------- --------------- NET INCREASE IN SHARES OUTSTANDING 8,172,208 3,101,983 1,373,649 5,550,801 --------------- --------------- --------------- --------------- --------------- --------------- --------------- --------------- - - ----------------------- * From January 15, 1993 (commencement of initial offering) to April 30, 1993. See notes to financial statements.
PREMIER MUNICIPAL BOND FUND FINANCIAL HIGHLIGHTS Contained below is per share operating performance data for a share of Beneficial Interest outstanding, total investment return, ratios to average net assets and other supplemental data for each year indicated. This information has been derived from information provided in the Fund's financial statements.
CLASS A SHARES CLASS B SHARES ----------------------------------------------- --------------------- YEAR ENDED APRIL 30, YEAR ENDED APRIL 30, ----------------------------------------------- --------------------- PER SHARE DATA: 1990 1991 1992 1993 1994 1993(1) 1994 ------- ------- ------- ------- ------- ------- ------- Net asset value, beginning of year.... $12.97 $12.77 $13.28 $13.75 $14.45 $14.02 $14.45 ------- ------- ------- ------- ------- ------- ------- INVESTMENT OPERATIONS: Investment income-net................. .99 .98 .94 .92 .89 .24 .80 Net realized and unrealized gain (loss) on investments............... (.20) .51 .49 .91 (.59) .43 (.59) ------- ------- ------- ------- ------- ------- ------- TOTAL FROM INVESTMENT OPERATIONS .79 1.49 1.43 1.83 .30 .67 .21 ------- ------- ------- ------- ------- ------- ------- DISTRIBUTIONS: Dividends from investment income-net.. (.99) (.98) (.94) (.92) (.89) (.24) (.80) Dividends from net realized gain on investments................. -- -- (.02) (.21) (.05) -- (.05) Dividends from excess net realized gain on investments................. -- -- -- -- -- -- -- ------- ------- ------- ------- ------- ------- ------- TOTAL DISTRIBUTIONS............. (.99) (.98) (.96) (1.13) (.94) (.24) (.85) ------- ------- ------- ------- ------- ------- ------- Net asset value, end of year.......... $12.77 $13.28 $13.75 $14.45 $13.81 $14.45 $13.81 ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- TOTAL INVESTMENT RETURN(2) 6.25% 12.13% 11.08% 13.76% 1.84% 16.80%(3) 1.26% RATIOS/SUPPLEMENTAL DATA: Ratio of expenses to average net assets -- .22% .54% .74% .85% 1.15%(3) 1.40% Ratio of net investment income to average net assets.................. 7.51% 7.43% 6.90% 6.43% 6.01% 5.13%(3) 5.33% Decrease reflected in above expense ratios due to undertakings by the Manager ..... 1.15% .82% .40% .20% .06% .10%(3) .05% Portfolio Turnover Rate............... 63.53% 41.30% 50.72% 30.99% 22.15% 30.99% 22.15% Net Assets, end of year (000's Omitted) $100,784 $247,195 $388,793 $526,606 $546,036 $19,855 $95,643 - - ---------------------------- (1) From January 15, 1993 (commencement of initial offering) to April 30, 1993. (2) Exclusive of sales load. (3) Annualized. See notes to financial statements.
PREMIER MUNICIPAL BOND FUND NOTES TO FINANCIAL STATEMENTS NOTE 1-SIGNIFICANT ACCOUNTING POLICIES: The Fund is registered under the Investment Company Act of 1940 ("Act") as a diversified open-end management investment company. Dreyfus Service Corporation ("Distributor") acts as the distributor of the Fund's shares. The Distributor is a wholly-owned subsidiary of The Dreyfus Corporation ("Manager"). The Fund offers both Class A and Class B shares. Class A shares are subject to a sales charge imposed at the time of purchase and Class B shares are subject to a contingent deferred sales charge imposed at the time of redemption on redemptions made within five years of purchase. Other differences between the two Classes include the services offered to and the expenses borne by each Class and certain voting rights. (A) PORTFOLIO VALUATION: The Fund's investments (excluding options and financial futures on municipal and U.S. treasury securities) are valued each business day by an independent pricing service ("Service") approved by the Board of Trustees. Investments for which quoted bid prices in the judgment of the Service are readily available and are representative of the bid side of the market are valued at the mean between the quoted bid prices (as obtained by the Service from dealers in such securities) and asked prices (as calculated by the Service based upon its evaluation of the market for such securities). Other investments (which constitute a majority of the portfolio securities) are carried at fair value as determined by the Service, based on methods which include consideration of: yields or prices of municipal securities of comparable quality, coupon, maturity and type; indications as to values from dealers; and general market conditions. Options and financial futures on municipal and U.S. treasury securities are valued at the last sales price on the securities exchange on which such securities are primarily traded or at the last sales price on the national securities market on each business day. Investments not listed on an exchange or the national securities market, or securities for which there were no transactions, are valued at the average of the most recent bid and asked prices. Bid price is used when no asked price is available. (B) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities transactions are recorded on a trade date basis. Realized gain and loss from securities transactions are recorded on the identified cost basis. Interest income, adjusted for amortization of premiums and, when appropriate, discounts on investments, is earned from settlement date and recognized on the accrual basis. Securities purchased or sold on a when-issued or delayed-delivery basis may be settled a month or more after the trade date. (C) DIVIDENDS TO SHAREHOLDERS: It is the policy of the Fund to declare dividends daily from investment income-net. Such dividends are paid monthly. Dividends from net realized capital gain are normally declared and paid annually, but the Fund may make distributions on a more frequent basis to comply with the distribution requirements of the Internal Revenue Code. To the extent that net realized capital gain can be offset by capital loss carryovers, if any, it is the policy of the Fund not to distribute such gain. Dividends in excess of net realized gains on investments for financial statement purposes result from current period wash sale loss deferrals to be recognized in future years and other losses from security transactions during the year ended April 30, 1994 which are treated for Federal income tax purposes as arising in fiscal 1995. (D) FEDERAL INCOME TAXES: It is the policy of the Fund to continue to qualify as a regulated investment company, which can distribute tax exempt dividends, by complying with the provisions available to certain investment companies, as defined in applicable sections of the Internal Revenue Code, and to make distributions of income and net realized capital gain sufficient to relieve it from all, or substantially all, Federal income taxes. PREMIER MUNICIPAL BOND FUND NOTES TO FINANCIAL STATEMENTS (CONTINUED) NOTE 2-MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES: (A) Pursuant to a management agreement ("Agreement") with the Manager, the management fee is computed at the annual rate of .55 of 1% of the average daily value of the Fund's net assets and is payable monthly. The Agreement provides for an expense reimbursement from the Manager should the Fund's aggregate expenses, exclusive of taxes, brokerage, interest on borrowings and extraordinary expenses, exceed the expense limitation of any state having jurisdiction over the Fund for any full fiscal year. However, the Manager had undertaken from May 1, 1993 through January 18, 1994 to reduce the management fee paid by the Fund, to the extent that the Fund's aggregate expenses (excluding certain expenses as described above) exceeded specified annual percentages of the Fund's average daily net assets. The reduction in management fee, pursuant to the undertakings, amounted to $399,146 for the year ended April 30, 1994. The Distributor retained $213,752 during the year ended April 30, 1994 from commissions earned on sales of the Fund's Class A shares. The Distributor retained $91,986 during the year ended April 30, 1994 from contingent deferred sales charges imposed upon redemptions of the Fund's Class B shares. (B) Under the Distribution Plan ("Class B Distribution Plan") adopted pursuant to Rule 12b-1 under the Act, the Fund pays the Distributor, at an annual rate of .50 of 1% of the value of the Fund's Class B shares average daily net assets, for costs and expenses in connection with advertising, marketing and distributing the Fund's Class B shares. The Distributor may make payments to one or more Service Agents (a securities dealer, financial institution, or other industry professional) based on the value of the Fund's Class B shares owned by clients of the Service Agent. During the year ended April 30, 1994, $324,814 was charged to the Fund pursuant to the Class B Distribution Plan. (C) Under the Shareholder Services Plan, the Fund pays the Distributor, at an annual rate of .25 of 1% of the value of the average daily net assets of Class A and Class B shares for servicing shareholder accounts. The services provided may include personal services relating to shareholder accounts, such as answering shareholder inquiries regarding the Fund and providing reports and other information, and services related to the maintenance of shareholder accounts. The Distributor may make payments to Service Agents in respect of these services. The Distributor determines the amounts to be paid to Service Agents. For the year ended April 30, 1994, $1,440,515 and $162,407 were charged to the Class A and Class B shares, respectively, pursuant to the Shareholder Services Plan. (D) Certain officers and trustees of the Fund are "affiliated persons," as defined in the Act, of the Manager and/or the Distributor. Each trustee who is not an "affiliated person" receives from the Fund an annual fee of $2,500 and an attendance fee of $250 per meeting. (E) On December 5, 1993, the Manager entered into an Agreement and Plan of Merger (the "Merger Agreement") providing for the merger of the Manager with a subsidiary of Mellon Bank Corporation ("Mellon"). Following the merger, it is planned that the Manager will be a direct subsidiary of Mellon Bank, N.A. Closing of this merger is subject to a number of contingencies, including receipt of certain regulatory approvals and approvals of the stockholders of the Manager and of Mellon. The merger is expected to occur in mid-1994, but could occur later. PREMIER MUNICIPAL BOND FUND NOTES TO FINANCIAL STATEMENTS (CONTINUED) As a result of regulatory requirements and the terms of the Merger Agreement, the Manager will seek various approvals from the Fund's board and shareholders before completion of the merger. Shareholder approval will be solicited by a proxy statement. NOTE 3-SECURITIES TRANSACTIONS: (A) Purchases and sales of securities, excluding option transactions, amounted to $292,478,175 and $168,116,003, respectively, for the year ended April 30, 1994, and consisted entirely of municipal bonds and short-term municipal investments. In addition, the following table summarizes the Fund's put options written transactions for the year ended April 30, 1994:
NUMBER OF PREMIUMS CONTRACTS RECEIVED ------------- ------------ OPTIONS WRITTEN: Contracts outstanding April 30, 1993......... - - Contracts Written............................ 400 $296,552 ---- ------------ Contracts outstanding April 30, 1994......... 400 $296,552 ---- ------------ ---- ------------
As a writer of put options, the Fund receives a premium at the outset and then bears the market risk of unfavorable changes in the price of the financial instrument underlying the option. Generally, the Fund would incur a loss if the price of the underlying financial instrument declines between the date the option is written and the date on which the option is terminated. Generally, the Fund would realize a gain, to the extent of the premiums, if the price of the financial instrument increases between those dates. (B) At April 30, 1994, accumulated net unrealized appreciation on investments was $5,842,904, consisting of $24,571,806 gross unrealized appreciation and $18,728,902 gross unrealized depreciation. At April 30, 1994, the cost of investments for Federal income tax purposes was substantially the same as the cost for financial reporting purposes (see the Statement of Investments). PREMIER MUNICIPAL BOND FUND REPORT OF ERNST & YOUNG, INDEPENDENT AUDITORS SHAREHOLDERS AND BOARD OF TRUSTEES PREMIER MUNICIPAL BOND FUND We have audited the accompanying statement of assets and liabilities of Premier Municipal Bond Fund, including the statements of investments and put options written, as of April 30, 1994, and the related statement of operations for the year then ended, the statement of changes in net assets for each of the two years in the period then ended, and financial highlights for each of the years indicated therein. These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of April 30, 1994 by correspondence with the custodian and brokers. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Premier Municipal Bond Fund at April 30, 1994, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the indicated years, in conformity with generally accepted accounting principles. (Ernst and Young Signature Logo) New York, New York June 3, 1994 PREMIER MUNICIPAL BOND FUND IMPORTANT TAX INFORMATION (UNAUDITED) In accordance with Federal tax law, the Fund hereby makes the following designations regarding its fiscal year ended April 30, 1994: -- All the dividends paid from investment income-net are "exempt-interest dividends" (not generally subject to regular Federal income tax). -- The $.0496 per share paid by the Fund on December 6, 1993 represents a long-term capital gain distribution. As required by Federal tax law rules, shareholders will receive notification of their portion of the Fund's taxable ordinary dividends (if any) and capital gain distributions (if any) paid for the 1994 calendar year on Form 1099-DIV which will be mailed by January 31, 1995. ANNUAL REPORT PREMIER MUNICIPAL BOND FUND APRIL 30, 1994 (Dreyfus Lion Logo) PREMIER MUNICIPAL BOND FUND 144 Glenn Curtiss Boulevard Uniondale, NY 11556 MANAGER The Dreyfus Corporation 200 Park Avenue New York, NY 10166 DISTRIBUTOR Dreyfus Service Corporation 200 Park Avenue New York, NY 10166 CUSTODIAN The Bank of New York 110 Washington Street New York, NY 10286 TRANSFER AGENT & DIVIDEND DISBURSING AGENT The Shareholder Services Group, Inc. P.O. Box 9671 Providence, RI 02940 Further information is contained in the Prospectus, which must precede or accompany this report. Printed in U.S.A. 022/612AR944 EX-99.A 2 PIE CHART IN THE PRESIDENT'S LETTER COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN PREMIER MUNICIPAL BOND FUND CLASS A SHARES AND THE LEHMAN BROTHERS MUNICIPAL BOND INDEX EXHIBIT A: _______________________________________________ | | | | | | | PREMIER | | PERIOD | LEHMAN BROTHERS | MUNICIPAL | | | MUNICIPAL | BOND FUND, | | | BOND INDEX * | CLASS A | |-----------|-----------------|----------------| | 11/26/86 | 10,000 | 9,550 | | 4/30/87 | 9,701 | 9,025 | | 4/30/88 | 10,550 | 9,353 | | 4/30/89 | 11,492 | 10,674 | | 4/30/90 | 12,320 | 11,341 | | 4/30/91 | 13,735 | 12,716 | | 4/30/92 | 15,041 | 14,126 | | 4/30/93 | 16,944 | 16,070 | | 4/30/94 | 17,310 | 16,366 | |----------------------------------------------| -----END PRIVACY-ENHANCED MESSAGE-----