NEUBERGER & BERMAN EQUITY TRUST
               Neuberger & Berman NYCDC Socially Responsive Trust
                 Supplement dated April 1, 1997 to Statement of
                  Additional Information dated December 6, 1996

                             INVESTMENT INFORMATION


The section regarding the investment program and manager of the Portfolio (pages
5-7) is revised to read as follows:

THE PORTFOLIO
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               Securities  for the  Portfolio  are selected  through a two-phase
process.  The first is financial.  The portfolio  manager analyzes a universe of
companies according to N&B Management's  value-oriented philosophy and looks for
stocks which are undervalued  for any number of reasons.  The manager focuses on
financial  fundamentals,  including balance sheet ratios and cash flow analysis,
and  meets  with  company  management  in an  effort  to  understand  how  those
unrecognized values might be realized in the market.

               The  second  part  of  the  process  is  social  screening.   N&B
Management's  social  research  is  based on the same  kind of  philosophy  that
governs  its  financial  approach:   N&B  Management  believes  that  first-hand
knowledge and experience are its most important tools. Utilizing a database, the
portfolio manager does careful, in-depth tracking and analyzes a large number of
companies on some eighty issues in six broad social categories. The manager uses
a wide variety of sources to determine  company  practices and policies in these
areas.  Performance  is analyzed in light of  knowledge of the issues and of the
best practices in each industry.

               The portfolio  manager  understands  that, for many issues and in
many  industries,  absolute  standards are elusive and often  counterproductive.
Thus, in addition to quantitative measurements, the manager places value on such
indicators  as  management  commitment,   progress,   direction,   and  industry
leadership.

AN INTERVIEW WITH THE PORTFOLIO MANAGER

               Q: First  things  first.  How do you begin  your stock  selection
process?

               A: Our first question is always: On financial grounds alone, is a
company a smart investment? For a company's stock to meet our financial test, it
must pass a number of hurdles.

               We look for  bargains,  just like the  portfolio  managers of the
other portfolios  managed by N&B Management.  More  specifically,  we search for
companies that we believe have terrific  products,  excellent  customer service,
and solid balance sheets -- but because they may have missed quarterly  earnings
expectations by a few pennies, because their sectors are currently out of favor,
because Wall Street overreacted to a temporary setback, or because the company's
merits aren't widely known, their stocks are selling at a discount.





               While we look at the stock's fundamentals  carefully,  that's not
all we examine.  We meet an awful lot of CEOs and CFOs. Top officers of over 400
companies  visit  Neuberger & Berman each year, and we're also frequently on the
road visiting dozens of corporations.  From the Fund's inception, we've met with
representatives of every company we own.

               When we're face to face with a CEO,  we're  searching for answers
to two crucial  questions:  "Does the company have a vision of where it wants to
go?" and "Can the management team make it happen?" We've analyzed  companies for
over  three  decades,  and we always  look for  companies  that have both  clear
strategies and management talent.

               Q: When you evaluate a company's  balance sheet, what matters the
most to you?

               A:  Definitely a company's  "free cash flow."  Compare it to your
household's  discretionary  income -- the  money  you have left over each  month
after you pay off your  monthly  debt and other  expenses.  With ample free cash
flow,  a company  can do any number of things.  It can buy back its stock.  Make
important  acquisitions.  Expand  its  research  and  development  spending.  Or
increase its dividend payments.

               When a company  generates lots of excess cash flow, it has growth
capital at its  disposal.  It can invest  for higher  profits  down the line and
improve  shareholder value.  Determining  exactly HOW a company intends to spend
its  excess  cash is an  entirely  different  matter  -- and  that's  where  the
information  learned in our company meetings comes in. Still, you've got to have
the extra cash in the first place. Which is why we pay so much attention to it.

               Q: So you take a hard look at a company's  balance  sheet and its
management. After a company passes your financial test, what do you do next?

               A: After  we're  convinced  of a  company's  merits on  financial
grounds alone, we review its record as a corporate  citizen.  In particular,  we
look for evidence of leadership in three key areas: concern for the environment,
workplace diversity, and enlightened employment practices.

               It should be clear that our social  screening  always takes place
after  we  search  far and  wide for  what we  believe  are the best  investment
opportunities available.  This is a crucial point, and an analogy can be used to
explain  it.  Let's  assume  you're  looking  to fill a vital  position  in your
company. What you'd pay attention to first is the candidate's competence: Can he
or she do the job? So after  interviewing a number of  candidates,  you'd narrow
your list to those that are highly qualified. To choose from this smaller group,
you might  look at the  candidate's  personality:  Can he or she get along  with
everyone in your group?

               Obviously, you wouldn't hire an unqualified person simply because
he or she is  likable.  What  you'd  probably  do is give  the  job to a  highly
qualified person who is ALSO compatible with your group.

               Now, let's turn to the companies that do make our financial cuts.
How do we decide whether they meet our social criteria?  Once again, our regular
meetings  with CEOs are key.  We look for top  management's  support of programs
that put more women and  minorities  in the  pipeline to be future  officers and


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board members;  that minimize  emissions,  reduce waste,  conserve  energy,  and
protect natural resources;  and that enable employees to balance work and family
life with benefits such as flextime and generous maternal AND paternal leave.

               We realize that companies are not all good or all bad. Instead of
looking for ethical perfection, we analyze how a company responds to troublesome
problems.  If a company is cited for  breaking a pollution  law, we evaluate its
reaction.  We also ask: Is it the first time? Do its top executives  have a plan
for making sure it doesn't happen again -- and how committed are they?

               If we're satisfied with the answers,  a company makes it into our
portfolio.  When all is said and done, we invest in companies  that have diverse
work forces,  strong CEOs, tough environmental  standards,  AND terrific balance
sheets.  In our  judgment,  financially  strong  companies  that are  also  good
corporate citizens are more likely to enjoy a competitive advantage. These days,
more and more people won't buy a product  unless they know it's  environmentally
friendly. In a similar vein, companies that treat their workers well may be more
productive and profitable.

               Q: Why have investors been attracted to the Fund?

               A: Our  shareholders are looking to invest for the future in more
ways than one. While they care deeply about their own financial futures, they're
equally passionate about the world they leave to later generations. They want to
be able to meet their  college bills and leave a world where the air is a little
cleaner and where the doors to the executive suite are a little more open.



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