-----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, A9xvSMjJHweaWN4ULrR4eJdSRs2e7qq+zGsVmMWC41FLo6O+d1GCMULp28mSKKF7 pWDH2kJUljAdvciSAl/3xQ== 0000806176-96-000024.txt : 19960708 0000806176-96-000024.hdr.sgml : 19960708 ACCESSION NUMBER: 0000806176-96-000024 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960430 FILED AS OF DATE: 19960705 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: PREMIER STATE MUNICIPAL BOND FUND CENTRAL INDEX KEY: 0000806176 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] STATE OF INCORPORATION: MA FISCAL YEAR END: 0430 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-04906 FILM NUMBER: 96591501 BUSINESS ADDRESS: STREET 1: 144 GENN CURTISS BLVD CITY: NUIONDALE STATE: NY ZIP: 11556 BUSINESS PHONE: 2129226805 FORMER COMPANY: FORMER CONFORMED NAME: PREMIER SERIES TAX EXEMPT BOND FUND DATE OF NAME CHANGE: 19870224 N-30D 1 ANNUAL REPORT PREMIER STATE MUNICIPAL BOND FUND, MARYLAND SERIES LETTER TO SHAREHOLDERS Dear Shareholder: We are pleased to provide you with this report on the Premier State Municipal Bond Fund - Maryland Series. For its annual reporting period ended April 30, 1996, your Series produced a total return of 7.24% for Class A shares, 6.66% for Class B shares and, since their inception on August 15, 1995, 3.97% for Class C shares.* Income dividends exempt from Federal, State of Maryland and City of Baltimore personal income taxes of approximately $.675 for Class A shares, $.605 for Class B shares and $.409 for Class C shares were paid.** This amounts to an annualized tax-free distribution rate per share of 5.04%, 4.73% and 4.50% for Class A, Class B and Class C shares respectively.*** THE ECONOMY Concerns that the economy was heading toward recession were eased by the recent release of brighter-than-expected reports on employment and consumer spending. Consequently, the Federal Reserve Board refrained from making any further reductions in the Federal Funds rate; the last easing of this benchmark interest rate occurred on January 31. In reaction to the more optimistic economic news (and the related fears of a potential rekindling of inflation), long-term interest rates as measured by 30-year Treasury bonds have risen nearly one percentage point since February. The rosier outlook for the economy was spearheaded by reports of large gains in employment for two consecutive months (February and March). Furthermore, personal income and expenditures data indicated that consumers continued to spend, despite their present high level of installment credit. Retail sales reports have correspondingly edged higher, confirming a modest recovery in consumer spending from its year-end slump. Supporting the growing consensus that the economy has picked up steam were reports of slow but steady growth in the manufacturing sector. After adjusting data for the 17-day General Motors strike, industrial output rose modestly. New orders for durable goods, a closely watched indicator of future hiring and production, also posted gains. Despite the economy's apparent recovery from its year-end pause, inflation has remained under control. Through March of this year, the Consumer Price Index rose at an annual rate of 2.8%. There appear to be few signs of inflationary pressure in the economy. Factories are running at a relatively comfortable rate of capacity (82.5%), markedly below this expansion's peak of 85.1% reached over a year ago. With major industries trying to reduce inventories, there is little to suggest that product pricing will surge upwards. Reflecting this absence of so-called pipeline inflationary pressure, price increases at both the wholesale and production levels of the economy remained similarly under control. We believe the cautionary stance of the Federal Reserve regarding additional reductions in interest rates combined with the fiscal restraint from reduced government spending should serve as additional moderating forces against any resurgence in inflation. We are mindful, however, of a potential change in what has been a benign inflation picture. The recent rise in oil prices, along with strength in other commodity prices such as grain, is not to be dismissed lightly. While they may be only aberrations of a temporary nature, they also could represent early warning signs of a fundamental change in inflation which will be seen later in the year. THE PORTFOLIO Since last writing to you in October 1995, certain themes have continued to guide all of our investment decisions. Specifically, throughout the year we have chosen to focus on debt issues bearing higher degrees of credit quality and broader measures of liquidity while constantly analyzing the risk/reward relationship of each individual municipal security. This strategy emphasizes purchasing municipals whose value is, in our opinion, understated, while selling overvalued issues whose current price is high when compared to the rest of the municipal market. As this strategy was implemented, the portfolio became more defensive in the beginning of 1996 in an effort to preserve shareholders' net asset value and maintain a high level of tax-free income. As interest rates rose, the Series took advantage of these current market conditions and purchased slightly longer-maturing issues whose value we considered to be understated. This investment strategy was maintained throughout the Series' recent fiscal year, and, in our view, was a successful one. Included in this report is a series of detailed statements about your Series' holdings and its financial condition. We hope they are informative. Please know that we appreciate greatly your continued confidence in the Series and in The Dreyfus Corporation. Sincerely, [Richard J. Moynihan signature logo] Richard J. Moynihan Director, Municipal Portfolio Management The Dreyfus Corporation May 15, 1996 New York, N.Y. * Total return includes reinvestment of dividends and any capital gains paid, without taking into account the maximum initial sales charge in the case of Class A shares or the applicable contingent deferred sales charge imposed on redemptions in the case of Class B shares and Class C shares. **Some income may be subject to the Federal Alternative Minimum Tax (AMT) for certain shareholders. Income may be subject to some State and local tax for non-Maryland residents. Capital gain distributions may be subject to Federal, State and local taxes. *** Annualized distribution rate per share is based upon dividends per share paid from net investment income during the period, divided by the maximum offering price in the case of Class A shares or the net asset value per share in the case of Class B and Class C shares, at the end of the period, adjusted for capital gain distributions. PREMIER STATE MUNICIPAL BOND FUND, MARYLAND SERIES APRIL 30, 1996 COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN PREMIER STATE MUNICIPAL BOND FUND, MARYLAND SERIES CLASS A SHARES AND THE LEHMAN BROTHERS MUNICIPAL BOND INDEX [Exhibit A] $20,644 Lehman Brothers Municipal Bond Index* Dollars $17,626 Premier State Municipal Bond Fund, Maryland Series (Class A Shares) [Exhibit A] *Source: Lehman Brothers
AVERAGE ANNUAL TOTAL RETURNS CLASS A SHARES CLASS B SHARES ____________________________________________________________ _______________________________________________________ % Return Reflecting % Return Applicable Contingent Reflecting % Return Deferred Sales % Return Without Maximum Initial Assuming No Charge Upon PERIOD ENDED 4/30/96 Sales Charge Sales Charge (4.5%) PERIOD ENDED 4/30/96 Redemption Redemption* ____________ ________ _________ ____________________ __________ __________ 1 Year 7.24% 2.42% 1 Year 6.66% 3.66% 5 Year 7.28 6.30 From Inception (1/15/93) 5.44 4.90 From Inception (5/28/87) 7.11 6.56
ACTUAL AGGREGATE TOTAL RETURNS CLASS C SHARES _____________________________________________________________ % Return Reflecting Applicable Contingent % Return Deferred Sales Assuming No Charge Upon PERIOD ENDED 4/30/96 Redemption Redemption** ____________ ________ _________ From Inception (8/15/95) 3.97% 2.97% Past performance is not predictive of future performance. The above graph compares a $10,000 investment made in Class A shares of Premier State Municipal Bond Fund, Maryland Series on 5/28/87 (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 5/31/87 is used as the beginning value on 5/28/87. All dividends and capital gain distributions are reinvested. Performance for Class B and Class C shares will vary from the performance of Class A shares shown above due to differences in charges and expenses. The Series invests primarily in Maryland municipal securities and its performance shown in the line graph takes into account the maximum initial sales charge on Class A shares and all other applicable fees and expenses. Unlike the Series, the Lehman Brothers Municipal Bond Index is an unmanaged total return performance benchmark for the long-term, investment-grade, geographically unrestricted tax exempt bond market, calculated by using municipal bonds selected to be representative of the municipal market overall. The Index does not take into account charges, fees and other expenses. Also, unlike the Fund which principally limits investments to Maryland municipal obligations, the Index is not State specific. These factors can contribute to the Index potentially outperforming the Series. Further information relating to Series performance, including expense reimbursements, if applicable, is contained in the Financial Highlights section of the Prospectus and elsewhere in this report. * Maximum contingent deferred sales charge for Class B shares is 3% and is reduced to 0% after five years. **Maximum contingent deferred sales charge for Class C shares is 1% within one year of the date of purchase.
PREMIER STATE MUNICIPAL BOND FUND, MARYLAND SERIES STATEMENT OF INVESTMENTS APRIL 30, 1996 PRINCIPAL LONG-TERM MUNICIPAL INVESTMENTS-98.8% AMOUNT VALUE _______ _______ MARYLAND-84.0% Anne Arundel County, Consolidated Water and Sewer 7.75%, 3/15/2008........................... $ 1,000,000 $ 1,095,570 Baltimore: 7%, 10/15/2007 (Insured; MBIA).......................................... 1,500,000 1,740,000 7.15%, 10/15/2008....................................................... 1,275,000 1,478,554 Port Facilities Revenue (Consolidated Coal Sales) 6.50%, 12/1/2010...... 9,740,000 10,484,915 Baltimore City Housing Corp., MFHR, Refunding 7.25%, 7/1/2023 (Collateralized; FNMA).................................. 3,245,000 3,386,255 Baltimore County: Mortgage Revenue: (First Mortgage - Pickersgill) 7.70%, 1/1/2021........................ 3,000,000 3,120,750 (Refunding - Tindeco Wharf Project) 6.50%, 12/20/2012 (Collateralized; GNMA) 1,500,000 1,553,940 PCR Refunding (Bethlehem Steel Corp. Project): 7.50%, 6/1/2015....................................................... 3,500,000 3,586,660 7.55%, 6/1/2017....................................................... 2,500,000 2,581,650 Gaithersburg, Hospital Facilities Improvement Revenue, Refunding (Shady Grove) 6.50%, 9/1/2012 (Insured; FSA).......................................... 10,000,000 11,005,100 Howard County: COP 8.15%, 2/15/2020.................................................... 605,000 797,154 EDR, Refunding (M.O.R. XIV Associates Project) 7.75%, 6/1/2012.......... 2,500,000 2,669,150 Howard County Metropolitan District 6.125%, 5/15/2023....................... 2,000,000 2,058,640 Kent County, College Revenue, Refunding (Washington College Project) 7.70%, 7/1/2018......................................................... 1,750,000 1,897,052 Maryland Community Development Administration, Department of Housing and Community Development: MFHR: 5.95%, 5/15/2013.................................................. 10,000,000 10,006,600 6.50%, 5/15/2013.................................................. 5,000,000 5,165,300 8.875%, 5/15/2021................................................. 360,000 365,069 7.30%, 5/15/2023.................................................. 2,205,000 2,308,370 6.85%, 5/15/2033.................................................. 5,000,000 5,126,900 6.70%, 5/15/2036 (Insured; FHA)................................... 5,415,000 5,541,982 Single Family Program: 7.40%, 4/1/2009................................................... 1,000,000 1,054,950 6.95%, 4/1/2011................................................... 6,125,000 6,385,312 7.70%, 4/1/2015................................................... 3,590,000 3,723,979 6.55%, 4/1/2026................................................... 7,500,000 7,610,475 6.75%, 4/1/2026................................................... 3,650,000 3,723,693 7.375%, 4/1/2026.................................................. 2,000,000 2,059,000 PREMIER STATE MUNICIPAL BOND FUND, MARYLAND SERIES STATEMENT OF INVESTMENTS (CONTINUED) APRIL 30, 1996 PRINCIPAL LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE _______ _______ MARYLAND (CONTINUED) Maryland Community Development Administration, Department of Housing and Community Development (continued): Single Family Program (continued): Zero Coupon, 4/1/2029............................................. $ 85,075,000 $ 5,887,190 7.625%, 4/1/2029.................................................. 7,545,000 7,829,597 7.45%, 4/1/2032................................................... 6,410,000 6,686,591 Maryland Department of Transportation, Consolidated Transportation 6.375%, 9/1/2006........................................................ 5,000,000 5,354,450 Maryland Economic Development Corp., Revenue (Health and Mental Hygiene Providers Facilities Acquisition Program): 8.375%, 3/1/2013...................................................... 4,415,000 4,684,006 8.75%, 3/1/2017....................................................... 5,150,000 5,462,863 Maryland Health and Higher Educational Facilities Authority, Revenue: (Bon Secours Hospital) 7.375%, 9/1/2017 (Prerefunded 7/1/2000) (a)...... 2,575,000 2,822,406 (Frederick Memorial Hospital) 5%, 7/1/2023 (Insured; FGIC) (b).......... 2,870,000 2,506,428 (Refunding - Doctors Community Hospital) 5.50%, 7/1/2024................ 4,700,000 4,010,181 (Refunding - Francis Scott Key Medical Center) 5%, 7/1/2023 (Insured; FGIC) 1,000,000 873,320 (Refunding - Memorial Hospital of Cumberland) 6.50%, 7/1/2017 (Insured; MBIA) 1,000,000 1,022,430 (Refunding - Roland Park Project) 7.75%, 7/1/2012....................... 2,230,000 2,355,304 (Refunding - Suburban Hospital) 5.125%, 7/1/2021 (Insured; AMBAC)....... 4,700,000 4,199,732 (Union Hospital of Cecil County) 6.70%, 7/1/2009........................ 2,320,000 2,381,039 (University of Maryland Medical Systems): 7%, 7/1/2022 (Insured; FGIC).......................................... 4,500,000 5,225,355 Refunding: 5.40%, 7/1/2008 (Insured; FGIC)................................... 2,625,000 2,627,993 (Northwest Hospital Center) 5.25%, 7/1/2013 (Insured; AMBAC)...... 6,500,000 6,103,955 Maryland Industrial Development Financing Authority, EDR (Medical Waste Association) 8.75%, 11/15/2010........................... 750,000 750,000 Maryland Local Government Insurance Trust, Capitalization Program, COP 7.125%, 8/1/2009........................................................ 3,250,000 3,551,535 Maryland National Capital Park and Planning Commission, Prince Georges County, Refunding (Park Aquisition and Development) 5.125%, 7/1/2010...................... 1,990,000 1,917,246 Maryland Stadium Authority, Sports Facility LR 7.60%, 12/15/2019............ 5,250,000 5,739,930 Maryland State and Local Facilities 5.125%, 10/15/2010...................... 4,635,000 4,479,218 Maryland Transportation Authority, Transportation Facilities Project Revenue Refunding 5.70%, 7/1/2005............................................... 3,700,000 3,884,186 Maryland Water Quality Financing Administration, Revolving Loan Fund Revenue: 6.70%, 9/1/2013 (Prerefunded 9/1/2001) (a).............................. 1,200,000 1,332,612 PREMIER STATE MUNICIPAL BOND FUND, MARYLAND SERIES STATEMENT OF INVESTMENTS (CONTINUED) APRIL 30, 1996 PRINCIPAL LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE _______ _______ MARYLAND (CONTINUED) Maryland Water Quality Financing Administration, Revolving Loan Fund Revenue (continued): 7.10%, 9/1/2013 (Prerefunded 9/1/2001) (a)............................ $ 600,000 $ 676,794 Montgomery County, PCR, Refunding (Potomac Electric Power Company) 5.375%, 2/15/2024 (Insured; MBIA)....................................... 8,750,000 8,136,538 Montgomery County Housing Opportunities Commission, Revenue: Multi-Family Mortgage: 7.05%, 7/1/2032....................................................... 2,485,000 2,570,260 7.375%, 7/1/2032...................................................... 4,630,000 4,831,729 Single Family Mortgage: 7.375%, 7/1/2017...................................................... 1,835,000 1,939,228 6.625%, 7/1/2026...................................................... 3,750,000 3,825,150 Montgomery County Revenue Authority, LR (Olney Indoor Swim Center Project) 6.30%, 7/15/2012 (Prerefunded 7/15/2000) (a)............................ 2,110,000 2,284,307 Northeast Waste Disposal Authority, Solid Waste Revenue (Montgomery County Resource Recovery Project): 6%, 7/1/2006.......................................................... 6,170,000 6,334,739 6%, 7/1/2008.......................................................... 3,690,000 3,737,343 6.20%, 7/1/2010....................................................... 8,650,000 8,724,304 Prince Georges County: Consolidated Public Improvement: 5.50%, 1/1/2012 (Insured; MBIA)....................................... 3,000,000 2,973,360 Refunding 6.75%, 7/1/2010 (Prerefunded 7/1/2001) (a).................. 1,170,000 1,266,069 PCR, Refunding (Potomac Electric Project): 5.75%, 3/15/2010...................................................... 5,250,000 5,339,093 6%, 9/1/2022.......................................................... 3,750,000 3,790,763 Prince Georges County Housing Authority: Mortgage Revenue, Refunding: (New Keystone Apartment Project) 6.80%, 7/1/2025 (Insured: FHA & MBIA) 4,300,000 4,467,829 (Stevenson Apartments Project) 6.35%, 7/20/2020 (Collateralized; GNMA) 3,000,000 3,055,890 SFMR 6.60%, 12/1/2025 (Collateralized: FNMA & GNMA)..................... 4,660,000 4,745,464 University of Maryland, System Auxiliary Facility and Tuition Revenue: 5.375%, 4/1/2009........................................................ 2,500,000 2,502,500 6.50%, 10/1/2012 (Prerefunded 10/1/2002) (a)............................ 1,420,000 1,575,802 Washington County, Public Improvement 4.875%, 1/1/2014 (Insured; FGIC)........................................ 1,450,000 1,299,142 Washington Suburban Sanitary District, Refunding (Water Supply) 5%, 6/1/2011............................................. 1,200,000 1,128,996 PREMIER STATE MUNICIPAL BOND FUND, MARYLAND SERIES STATEMENT OF INVESTMENTS (CONTINUED) APRIL 30, 1996 PRINCIPAL LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE _______ _______ U. S. RELATED-14.8% Guam Airport Authority, Revenue 6.70%, 10/1/2023............................ $ 4,000,000 $ 4,012,160 Guam Power Authority, Revenue 6.30%, 10/1/2012.............................. 3,400,000 3,346,892 Puerto Rico Commonwealth 5.85%, 7/1/2009.................................... 5,000,000 5,046,350 Puerto Rico Commonwealth Aqueduct and Sewer Authority, Revenue, Refunding 5%, 7/1/2019............................................................ 6,000,000 5,196,420 Puerto Rico Commonwealth Highway and Transportation Authority, Highway Revenue: 5.40%, 7/1/2006 (Insured; FSA).......................................... 11,000,000 11,022,770 5.50%, 7/1/2013......................................................... 4,000,000 3,822,160 Refunding: 5.25%, 7/1/2021 (c)................................................... 2,500,000 2,206,325 5%, 7/1/2022.......................................................... 2,080,000 1,764,630 Puerto Rico Public Buildings Authority, Revenue, Refunding 5.70%, 7/1/2009.. 3,500,000 3,543,400 University of Puerto Rico, University Revenue 5.25%, 6/1/2025 (Insured; MBIA) 7,775,000 7,171,971 ____________ TOTAL LONG-TERM MUNICIPAL INVESTMENTS (cost $307,100,599)................... $314,552,965 ============== SHORT-TERM MUNICIPAL INVESTMENTS-1.2% MARYLAND-.1% Frederick, VRDN 3.90% (LOC; Fuji Bank and Trust Company) (d,e).............. $ 300,000 $ 300,000 U.S. RELATED-1.1% Puerto Rico Electric Power Authority, Power Revenue 3.32% (Insured; FSA) (f) 3,600,000 3,600,000 ____________ TOTAL SHORT-TERM MUNICIPAL INVESTMENTS (cost $3,900,000).................... $ 3,900,000 ============== TOTAL INVESTMENTS-100.0% (cost $311,000,599)................................ $318,452,965 ==============
PREMIER STATE MUNICIPAL BOND FUND, MARYLAND SERIES SUMMARY OF ABBREVIATIONS AMBAC American Municipal Bond Assurance Corporation LOC Letter of Credit COP Certificate of Participation LR Lease Revenue EDR Economic Development Revenue MBIA Municipal Bond Investors Assurance FGIC Financial Guaranty Insurance Company Insurance Corporation FHA Federal Housing Administration MFHR Multi-Family Housing Revenue FNMA Federal National Mortgage Association PCR Pollution Control Revenue FSA Financial Security Assurance SFMR Single Family Mortgage Revenue GNMA Government National Mortgage Association VRDN Variable Rate Demand Notes
SUMMARY OF COMBINED RATINGS (UNAUDITED) FITCH (G) OR MOODY'S OR STANDARD & POOR'S PERCENTAGE OF VALUE ____ ________ ___________________ ______________________ AAA Aaa AAA 30.8% AA Aa AA 35.2 A A A 21.9 BBB Baa BBB 4.9 F1+ & F1 MIG1, VMIG1 & P1 SP1 & A1 .1 Not Rated (h) Not Rated (h) Not Rated (h) 7.1 __________ 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 municipal issue and to retire the bonds in full at the earliest refunding date. (b) Wholly held by the custodian in a segregated account as collateral for a delayed-delivery security. (c) Purchased on a delayed-delivery basis. (d) Securities payable on demand. The interest rate, which is subject to change, is based upon bank prime rates or an index of market interest rates. (e) Secured by letters of credit. (f) Inverse floater security - the interest rate is subject to change periodically. (g) Fitch currently provides creditworthiness information for a limited number of investments. (h) Securities which, while not rated by Fitch, Moody's or Standard & Poor's have been determined by the Manager to be of comparable quality to those rated securities in which the Series may invest. (i) At April 30, 1996, the Series had $103,850,755 (31.9% of net assets) invested in securities whose payment of principal and interest is dependent upon revenues generated from housing projects. See notes to financial statements.
PREMIER STATE MUNICIPAL BOND FUND, MARYLAND SERIES STATEMENT OF ASSETS AND LIABILITIES APRIL 30, 1996 ASSETS: Investments in securities, at value (cost $311,000,599)-see statement..................................... $318,452,965 Cash.................................................................... 1,251,041 Interest receivable..................................................... 5,430,384 Receivable for investment securities sold............................... 2,677,860 Receivable for shares of Beneficial Interest subscribed................. 196,474 Prepaid expenses........................................................ 8,469 ___________ 328,017,193 LIABILITIES: Due to The Dreyfus Corporation.......................................... $ 147,272 Due to Distributor...................................................... 83,750 Payable for investment securities purchased............................. 2,242,850 Payable for shares of Beneficial Interest redeemed...................... 393,595 Accrued expenses........................................................ 65,973 2,933,440 ____________ _____________ NET ASSETS.................................................................. $325,083,753 ============= REPRESENTED BY: Paid-in capital......................................................... $314,643,536 Accumulated undistributed net realized gain on investments.............. 2,987,851 Accumulated net unrealized appreciation on investments-Note 3........... 7,452,366 ___________ NET ASSETS at value......................................................... $325,083,753 ============= Shares of Beneficial Interest outstanding: Class A Shares (unlimited number of $.001 par value shares authorized)............... 22,367,145 ============= Class B Shares (unlimited number of $.001 par value shares authorized)............... 3,244,429 ============= Class C Shares (unlimited number of $.001 par value shares authorized)............... 2,094 ============= NET ASSET VALUE per share: Class A Shares ($283,877,760 / 22,367,145 shares).................................... $12.69 ======== Class B Shares ($41,179,420 / 3,244,429 shares)...................................... $12.69 ======== Class C Shares ($26,573 / 2,094 shares).............................................. $12.69 ======== See notes to financial statements. PREMIER STATE MUNICIPAL BOND FUND, MARYLAND SERIES STATEMENT OF OPERATIONS YEAR ENDED APRIL 30, 1996 INVESTMENT INCOME: INTEREST INCOME......................................................... $ 20,680,770 EXPENSES: Management fee-Note 2(a).............................................. $ 1,852,002 Shareholder servicing costs-Note 2(c)................................. 1,067,466 Distribution fees-Note 2(b)........................................... 194,102 Professional fees..................................................... 48,325 Custodian fees........................................................ 36,892 Prospectus and shareholders' reports.................................. 13,072 Registration fees..................................................... 6,769 Trustees' fees and expenses-Note 2(d)................................. 4,732 Miscellaneous......................................................... 23,089 ___________ TOTAL EXPENSES.................................................. 3,246,449 ____________ INVESTMENT INCOME-NET........................................... 17,434,321 REALIZED AND UNREALIZED GAIN ON INVESTMENTS: Net realized gain on investments-Note 3................................. $4,318,992 Net unrealized appreciation on investments.............................. 1,867,438 ___________ NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS................. 6,186,430 ____________ NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........................ $23,620,751 ============= See notes to financial statements.
PREMIER STATE MUNICIPAL BOND FUND, MARYLAND SERIES STATEMENT OF CHANGES IN NET ASSETS YEAR ENDED APRIL 30, ________________________________ 1995 1996 ______________ ______________ OPERATIONS: Investment income-net................................................... $ 19,487,297 $ 17,434,321 Net realized gain on investments........................................ 874,479 4,318,992 Net unrealized appreciation on investments for the year................. 276,297 1,867,438 ______________ ______________ NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS.............. 20,638,073 23,620,751 ______________ ______________ DIVIDENDS TO SHAREHOLDERS FROM: Investment income-net: Class A shares........................................................ (17,819,972) (15,612,512) Class B shares........................................................ (1,667,325) (1,821,592) Class C shares........................................................ - (217) Net realized gain on investments: Class A shares........................................................ - (1,739,958) Class B shares........................................................ - (229,505) Class C shares........................................................ - (6) ______________ ______________ TOTAL DIVIDENDS................................................... (19,487,297) (19,403,790) ______________ ______________ BENEFICIAL INTEREST TRANSACTIONS: Net proceeds from shares sold: Class A shares........................................................ 15,871,084 11,106,487 Class B shares........................................................ 7,200,284 7,992,863 Class C shares........................................................ - 27,000 Dividends reinvested: Class A shares........................................................ 11,260,663 11,154,241 Class B shares........................................................ 1,087,620 1,358,026 Class C shares........................................................ - 219 Cost of shares redeemed: Class A shares........................................................ (61,788,292) (44,093,946) Class B shares........................................................ (3,903,364) (3,601,826) ______________ ______________ (DECREASE) IN NET ASSETS FROM BENEFICIAL INTEREST TRANSACTIONS.... (30,272,005) (16,056,936) ______________ ______________ TOTAL (DECREASE) IN NET ASSETS.................................. (29,121,229) (11,839,975) NET ASSETS: Beginning of year....................................................... 366,044,957 336,923,728 ______________ ______________ End of year............................................................. $336,923,728 $325,083,753 ============ ==============
SHARES ___________________________________________________________________________________ CLASS A CLASS B CLASS C _____________________________ ____________________ _______________ YEAR ENDED YEAR ENDED APRIL 30, YEAR ENDED APRIL 30, APRIL 30, _____________________________ ____________________ ____________ 1995 1996 1995 1996 1996* _________ _______ _______ _______ _______ CAPITAL SHARE TRANSACTIONS: Shares sold............ 1,283,464 860,692 582,210 620,596 2,077 Shares issued for dividends reinvested. 913,405 863,509 88,247 105,093 17 Shares redeemed........ (5,049,171) (3,429,459) (321,839) (279,793) - _________ _______ _______ _______ _______ NET INCREASE (DECREASE) IN SHARES OUTSTANDING.... (2,852,302) (1,705,258) 348,618 445,896 2,094 ============ ============ ========== ========== ============ * From August 15, 1995 (commencement of initial offering) to April 30, 1996. See notes to financial statements.
PREMIER STATE MUNICIPAL BOND FUND, MARYLAND SERIES 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 the Series' financial statements. CLASS A SHARES __________________________________________________________ YEAR ENDED APRIL 30, __________________________________________________________ PER SHARE DATA: 1992 1993 1994 1995 1996 ______ ______ ______ ______ _____ Net asset value, beginning of year........... $12.13 $12.43 $13.02 $12.46 $12.54 ______ ______ ______ ______ _____ INVESTMENT OPERATIONS: Investment income-net........................ .79 .76 .73 .70 .67 Net realized and unrealized gain (loss) on investments............................. .35 .68 (.53) .08 .23 ______ ______ ______ ______ _____ TOTAL FROM INVESTMENT OPERATIONS........... 1.14 1.44 .20 .78 .90 ______ ______ ______ ______ _____ DISTRIBUTIONS: Dividends from investment income-net......... (.79) (.76) (.73) (.70) (.67) Dividends from net realized gain on investments (.05) (.09) (.03) - (.08) ______ ______ ______ ______ _____ TOTAL DISTRIBUTIONS........................ (.84) (.85) (.76) (.70) (.75) ______ ______ ______ ______ _____ Net asset value, end of year................. $12.43 $13.02 $12.46 $12.54 $12.69 ======= ======= ====== ====== ======= TOTAL INVESTMENT RETURN*......................... 9.68% 11.93% 1.33% 6.52% 7.24% RATIOS/SUPPLEMENTAL DATA: Ratio of expenses to average net assets...... .53% .69% .80% .90% .90% Ratio of net investment income to average net assets 6.40% 5.93% 5.51% 5.69% 5.23% Decrease reflected in above expense ratios due to undertakings by the Manager................ .41% .22% .10% .01% - Portfolio Turnover Rate...................... 16.21% 17.92% 10.27% 35.39% 41.65% Net Assets, end of year (000's Omitted)...... $254,240 $337,307 $335,518 $301,834 $283,878 * Exclusive of sales load. See notes to financial statements.
PREMIER STATE MUNICIPAL BOND FUND, MARYLAND SERIES FINANCIAL HIGHLIGHTS (CONTINUED) 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 the Series' financial statements. CLASS B SHARES CLASS C SHARES _______________________________________ ____________________ YEAR ENDED APRIL 30, YEAR ENDED APRIL 30, _______________________________________ ____________________ PER SHARE DATA: 1993(1) 1994 1995 1996 1996(2) ____ ____ ____ ____ __________ Net asset value, beginning of year........ $12.64 $13.02 $12.46 $12.54 $12.67 ______ ______ ______ ______ ______ INVESTMENT OPERATIONS: Investment income-net..................... .20 .65 .63 .61 .41 Net realized and unrealized gain (loss) on investments.......................... .38 (.53) .08 .23 .10 ______ ______ ______ ______ ______ TOTAL FROM INVESTMENT OPERATIONS........ .58 .12 .71 .84 .51 ______ ______ ______ ______ ______ DISTRIBUTIONS: Dividends from investment income-net...... (.20) (.65) (.63) (.61) (.41) Dividends from net realized gain on investments.......................... - (.03) - (.08) (.08) ______ ______ ______ ______ ______ TOTAL DISTRIBUTIONS..................... (.20) (.68) (.63) (.69) (.49) ______ ______ ______ ______ ______ Net asset value, end of year.............. $13.02 $12.46 $12.54 $12.69 $12.69 ====== ======= ======== ====== ======= TOTAL INVESTMENT RETURN(3)................ 15.74%(4) .75% 5.94% 6.66% 5.57%(4) RATIOS/SUPPLEMENTAL DATA: Ratio of expenses to average net assets 1.09%(4) 1.37% 1.44% 1.43% 1.80%(4) Ratio of net investment income to average net assets.................. 4.55%(4) 4.82% 5.13% 4.68% 4.59%(4) Decrease reflected in above expense ratios due to undertakings by the Manager...... .12%(4) .08% .01% - - Portfolio Turnover Rate............... 17.92% 10.27% 35.39% 41.65% 41.65% Net Assets, end of year (000's Omitted) $5,931 $30,527 $35,090 $41,179 $27 (1) From January 15, 1993 (commencement of initial offering) to April 30, 1993. (2) From August 15, 1995 (commencement of initial offering) to April 30, 1996. (3) Exclusive of sales load. (4) Annualized. See notes to financial statements.
PREMIER STATE MUNICIPAL BOND FUND, MARYLAND SERIES NOTES TO FINANCIAL STATEMENTS NOTE 1-SIGNIFICANT ACCOUNTING POLICIES: Premier State Municipal Bond Fund (the "Fund") is registered under the Investment Company Act of 1940 ("Act") as a non-diversified open-end management investment company and operates as a series company currently offering twelve series including the Maryland Series (the "Series"). The Fund's investment objective is to maximize current income exempt from Federal and, where applicable, from State income taxes, without undue risk. The Dreyfus Corporation ("Manager") serves as the Fund's investment adviser. The Manager is a direct subsidiary of Mellon Bank, N.A. Premier Mutual Fund Services, Inc. (the "Distributor") acts as the distributor of the Fund's shares. The Series offers Class A, Class B and Class C shares. Class A shares are subject to a sales charge imposed at the time of purchase, 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 and Class C shares are subject to a contingent deferred sales charge imposed at the time of redemption on redemptions made within one year of purchase. Other differences between the three Classes include the services offered to and the expenses borne by each Class and certain voting rights. The Fund accounts separately for the assets, liabilities and operations of each series. Expenses directly attributable to each series are charged to that series' operations; expenses which are applicable to all series are allocated among them on a pro rata basis. (A) PORTFOLIO VALUATION: The Series' 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 are readily available and are representative of the bid side of the market in the judgment of the Service 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 original issue 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. The Series follows an investment policy of investing primarily in municipal obligations of one state. Economic changes affecting the state and certain of its public bodies and municipalities may affect the ability of issuers within the state to pay interest on, or repay principal of, municipal obligations held by the Series. PREMIER STATE MUNICIPAL BOND FUND, MARYLAND SERIES NOTES TO FINANCIAL STATEMENTS (CONTINUED) (C) DIVIDENDS TO SHAREHOLDERS: It is the policy of the Series 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 Series 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 Series not to distribute such gain. (D) FEDERAL INCOME TAXES: It is the policy of the Series to continue to qualify as a regulated investment company, which can distribute tax exempt dividends, by complying with the applicable provisions of the Internal Revenue Code, and to make distributions of income and net realized capital gain sufficient to relieve it from substantially all Federal income and excise taxes. 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 value of the Series' average daily net assets and is payable monthly. The Agreement provides for an expense reimbursement from the Manager should the Series' aggregate expenses, exclusive of taxes, brokerage, interest on borrowings and extraordinary expenses, exceed the expense limitation of any state having jurisdiction over the Series for any full fiscal year. There was no expense reimbursement for the year ended April 30, 1996. Dreyfus Service Corporation, a wholly-owned subsidiary of the Manager, retained $1,197 during the year ended April 30, 1996 from commissions earned on sales of the Series' shares. (B) Under the Distribution Plan adopted pursuant to Rule 12b-1 under the Act, the Series pays the Distributor for distributing the Series' Class B and Class C shares at an annual rate of .50 of 1% of the value of the average daily net assets of Class B shares and .75 of 1% of the value of the average daily net assets of Class C shares. During the year ended April 30, 1996, $194,067 was charged to the Series for the Class B shares and $35 was charged to the Series for the Class C shares. (C) Under the Shareholder Services Plan, the Series pays the Distributor at an annual rate of .25 of 1% of the value of the average daily net assets of Class A, Class B and Class C shares for the provision of certain services. The services provided may include personal services relating to shareholder accounts, such as answering shareholder inquiries regarding the Series and providing reports and other information, and services related to the maintenance of shareholder accounts. The Distributor may make payments to Service Agents (a securities dealer, financial institution or other industry professional) in respect of these services. The Distributor determines the amounts to be paid to Service Agents. During the year ended April 30, 1996, $744,774, $97,033 and $12 were charged to Class A, Class B and Class C shares, respectively, by the Distributor pursuant to the Shareholder Services Plan. Effective December 1, 1995, the Series compensates Dreyfus Transfer, Inc., a wholly owned subsidiary of the Manager, under a transfer agency agreement for providing personnel and facilities to perform transfer agency services for the Series. Such compensation amounted to $62,934 for the period from December 1, 1995 through April 30, 1996. PREMIER STATE MUNICIPAL BOND FUND, MARYLAND SERIES NOTES TO FINANCIAL STATEMENTS (CONTINUED) (D) Each trustee who is not an "affiliated person" as defined in the Act receives from the Fund an annual fee of $2,500 and an attendance fee of $250 per meeting. The Chairman of the Board receives an additional 25% of such compensation. NOTE 3-SECURITIES TRANSACTIONS: The aggregate amount of purchases and sales of investment securities, excluding short-term securities, during the year ended April 30, 1996 amounted to $137,715,503 and $160,233,158, respectively. At April 30, 1996, accumulated net unrealized appreciation on investments was $7,452,366, consisting of $10,271,631 gross unrealized appreciation and $2,819,265 gross unrealized depreciation. At April 30, 1996, 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 STATE MUNICIPAL BOND FUND, MARYLAND SERIES REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS SHAREHOLDERS AND BOARD OF TRUSTEES PREMIER STATE MUNICIPAL BOND FUND, MARYLAND SERIES We have audited the accompanying statement of assets and liabilities, including the statement of investments, of Premier State Municipal Bond Fund, Maryland Series (one of the Series constituting the Premier State Municipal Bond Fund) as of April 30, 1996, 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, 1996 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 State Municipal Bond Fund, Maryland Series at April 30, 1996, 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 & Young LLP signature logo] New York, New York June 5, 1996 PREMIER STATE MUNICIPAL BOND FUND, MARYLAND SERIES IMPORTANT TAX INFORMATION (UNAUDITED) In accordance with Federal tax law, the Series hereby makes the following designations regarding its fiscal year ended April 30, 1996: - all the dividends paid from investment income-net are "exempt-interest dividends" (not subject to regular Federal income tax and, for individuals who are Maryland residents, Maryland personal income taxes), and - the Series hereby designates $.0727 per share as a long-term capital gain distribution of the $.0757 per share paid on December 6, 1995. As required by Federal tax law rules, shareholders will receive notification of their portion of the Series' taxable ordinary dividends (if any) and capital gain distributions (if any) paid for the 1996 calendar year on Form 1099-DIV which will be mailed by January 31, 1997. PREMIER STATE MUNICIPAL BOND FUND, MARYLAND SERIES 200 Park Avenue New York, NY 10166 MANAGER The Dreyfus Corporation 200 Park Avenue New York, NY 10166 CUSTODIAN The Bank of New York 90 Washington Street New York, NY 10286 TRANSFER AGENT & DIVIDEND DISBURSING AGENT Dreyfus Transfer, Inc. One American Express Plaza Providence, RI 02903 Further information is contained in the Prospectus, which must precede or accompany this report. Printed in U.S.A. 052/616AR964 Annual Report Premier State Municipal Bond Fund Maryland Series April 30, 1996 [lion2/hres logo] EX-99.A 2 GRAPH IN PRESIDENT'S LTR OF ANNUAL REPORT COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN PREMIER STATE MUNICIPAL BOND FUND, MARYLAND SERIES CLASS A SHARES AND THE LEHMAN BROTHERS MUNICIPAL BOND INDEX EXHIBIT A: ___________________________________________________ | | | | | | | PREMIER STATE | | PERIOD | LEHMAN BROTHERS |MUNICIPAL BOND FUND,| | | MUNICIPAL | MARYLAND SERIES | | | BOND INDEX * | (CLASS A SHARES) | |-----------|-----------------|--------------------| | 5/28/87 | 10,000 | 9,549 | | 4/30/88 | 10,929 | 9,327 | | 4/30/89 | 11,905 | 10,358 | | 4/30/90 | 12,762 | 11,050 | | 4/30/91 | 14,229 | 12,402 | | 4/30/92 | 15,581 | 13,604 | | 4/30/93 | 17,553 | 15,227 | | 4/30/94 | 17,932 | 15,430 | | 4/30/95 | 19,124 | 16,436 | | 4/30/96 | 20,644 | 17,626 | |--------------------------------------------------| *Source: Lehman Brothers -----END PRIVACY-ENHANCED MESSAGE-----