United States
Securities and Exchange Commission
Washington, D.C. 20549
Form N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number: 811-02383
AllianceBernstein Bond Fund, Inc.
(Exact name of registrant as specified in charter)
1345 Avenue of the Americas, New York, New York 10105
(Address of principal executive offices) (Zip code)
Edmund P. Bergan, Jr.
Alliance Capital Management, L.P.
1345 Avenue of the Americas
New York, New York 10105
(Name and address of agent for service)
Registrant's telephone number, including area code: (800) 221-5672
Date of fiscal year end: June 30, 2003
Date of reporting period: June 30, 2003
ITEM 1. REPORTS TO STOCKHOLDERS.
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Corporate Fixed Income
- -------------------------------------------------------------------------------
AllianceBernstein [LOGO](SM)
Investment Research and Management
AllianceBernstein Bond Fund
Corporate Bond Portfolio
Annual Report -- June 30, 2003
Investment Products Offered
- -------------------------
o Are Not FDIC Insured
o May Lose Value
o Are Not Bank Guaranteed
- -------------------------
This shareholder report must be preceded or accompanied by the Fund's
prospectus for individuals who are not current shareholders of the Fund.
AllianceBernstein Investment Research and Management, Inc., the principal
underwriter of the AllianceBernstein mutual funds and an affiliate of Alliance
Capital Management L.P., the manager of the funds, is a member of the NASD.
August 15, 2003
Annual Report
We're excited to announce that Alliance Fund Distributors, Inc. has become
AllianceBernstein Investment Research and Management, Inc. All of Alliance
Capital's domestic mutual funds have been renamed AllianceBernstein.
This report provides management's discussion of fund performance for
AllianceBernstein Bond Fund Corporate Bond Portfolio (the "Portfolio") for the
annual reporting period ended June 30, 2003.
Investment Objectives and Policies
The primary objective of this open-end fund is to maximize income over the
long-term, to the extent consistent with providing reasonable safety in the
value of each shareholder's investment. As a secondary objective, the Portfolio
seeks capital appreciation. To achieve its objectives, the Portfolio invests
primarily in corporate bonds. The Portfolio may also hold debt securities
issued by the U.S. and foreign governments. While the Portfolio invests
primarily in investment-grade debt securities, it may also invest a significant
amount of its assets in lower-rated debt securities.
Investment Results
The following table shows how the Portfolio performed over the past six- and
12-month periods ended June 30, 2003. For comparison, we have included the
Lehman Brothers (LB) Long BAA U.S. Credit Index, a measure of the performance
of a basket of unmanaged corporate debt securities. We have also included the
performance for the Lipper Corporate Debt BBB-Rated Funds Average (the "Lipper
Average"), the average performance of a group of corporate bond funds with
similar objectives to the Portfolio.
INVESTMENT RESULTS*
Periods Ended June 30, 2003
---------------------------------
Returns
---------------------------------
6 Months 12 Months
-------------- --------------
AllianceBernstein
Bond Fund Corporate
Bond Portfolio
Class A 12.05% 20.75%
- ------------------------------------------------------------
Class B 11.61% 19.85%
- ------------------------------------------------------------
Class C 11.60% 19.85%
- ------------------------------------------------------------
Lehman Brothers Long BAA
U.S. Credit Index 13.20% 24.08%
- ------------------------------------------------------------
Lipper Corporate Debt
BBB-Rated Funds Average 6.78% 12.89%
- ------------------------------------------------------------
* The Portfolio's investment results are returns for the periods shown and are
based on the net asset value (NAV) of each class of shares as of June 30,
2003. Returns do not reflect the deduction of taxes that a shareholder would
pay on fund distributions or the redemption of fund shares. All fees and
expenses related to the operation of the Portfolio have been deducted, but
no adjustment has been made for sales charges that may apply when shares are
purchased or redeemed. Returns for the Portfolio include the reinvestment of
any distributions paid during each period. Past performance is no guarantee
of future results.
The unmanaged Lehman Brothers (LB) Long BAA U.S. Credit Index is a measure of
corporate and non-corporate fixed income
_______________________________________________________________________________
ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO o 1
securities that are rated investment grade (Baa by Moody's Investors Service
or BBB by Standard & Poor's) and have at least 10 years to final maturity.
The unmanaged Lipper Corporate Debt BBB-Rated Funds Average (the "Lipper
Average") is based on the performance of a universe of funds that invest at
least 65% of their assets in corporate or government debt issues rated in
the top four grades. For the six- and 12-month periods ended June 30, 2003,
the Lipper Average consisted of 183 and 162 funds, respectively. An investor
cannot invest directly in an index or an average, and its results are not
indicative of any specific investment, including AllianceBernstein Bond Fund
Corporate Bond Portfolio.
Additional investment results appear on page 6.
For the six- and 12-month periods ended June 30, 2003, the Portfolio
underperformed its benchmark, the LB Long BAA U.S. Credit Index. However, the
Fund significantly outperformed the Lipper Average of corporate BBB-rated debt
funds. Relative to the LB Long BAA U.S. Credit Index, underperformance was
attributable to the Portfolio's maintaining a much shorter duration strategy in
the second quarter, in an environment of declining interest rates.
Security selection among high yield issues and an overweight position in
cable/media and utilities contributed positively to performance. Relative to
the Lipper Average, the Portfolio's outperformance was mainly due to the strong
performance of the high yield sector relative to investment grade corporates,
as high yield positions comprised approximately 20%-25% of the Portfolio
throughout the period. Another positive contributor to performance was the
Portfolio's position, held throughout most of the first half of the year, in
long Russia paper. This credit outperformed most investment grade and high
yield issues.
Market Review and Investment Strategy
Business conditions worsened in the first quarter of the year, despite record
high corporate cash flow, signs of consumer strength in rising building permits
and a new high in the mortgage refinance index. The U.S. economy contracted in
February and March, in part because of bad weather and also because of
corporate and consumer hesitancy to make purchase and investment decisions
during the Iraqi conflict.
The second quarter saw interest rates fall sharply in anticipation of U.S.
Federal Reserve easing. As a result, the bond markets delivered very strong
absolute returns. The second quarter of 2003 proved to be one of the highest
performing in history for investment grade corporates, with April's return
premium of 1.5% over like duration Treasuries, qualifying that month as the
third best in the past decade. Despite fears of deflation risk, credit spreads,
as measured by the LB U.S. Credit Index, tightened 23 basis points, reflecting
investors' uncurbed appetite for yield in a low-rate environment as well as
legitimate improvement in fundamental credit quality. Lower quality sectors
delivered the strongest
_______________________________________________________________________________
2 o ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO
returns, led by the Baa/BBB sector, which produced a return premium of 347
basis points over like duration Treasuries year-to-date. Investors' increased
confidence and willingness to take on more risk was also demonstrated during
the strong rebound in equity prices over the same period.
During the six-month period, we increased the Portfolio's allocation to high
yield, in light of declining default rates and record cash flow into the
sector. We also added a modest position of banking sector preferred stock as
well as BBB-rated Yankee bonds. Additionally, we have maintained an interest
rate hedge using Treasury futures since the end of the first quarter to keep
the Portfolio's duration risk at a moderate level, in line with our forecast.
Duration is now approximately 5.5 years, as opposed to 9.0 years at year-end
2002.
_______________________________________________________________________________
ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO o 3
PERFORMANCE UPDATE
ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO
GROWTH OF A $10,000 INVESTMENT
6/30/93 TO 6/30/03
Lehman Brothers Long BAA U.S. Credit Index: $22,821
Lipper Corporate Debt BBB-Rated Funds Average: $19,609
AllianceBernstein Bond Fund Corporate Bond Portfolio Class A: $19,149
[THE FOLLOWING TABLE WAS DEPICTED BY A MOUNTAIN CHART IN THE PRINTED MATERIAL.]
AllianceBernstein Lehman Brothers Lipper
Bond Fund Long BAA Corporate Debt
Corporate Bond U.S. Credit BBB-Rated
Portfolio Class A Index Funds Average
- -------------------------------------------------------------------------------
6/30/93 $ 9,574 $ 10,000 $ 10,000
6/30/94 $ 9,327 $ 9,620 $ 9,847
6/30/95 $ 10,564 $ 11,564 $ 11,163
6/30/96 $ 11,847 $ 12,134 $ 11,865
6/30/97 $ 13,812 $ 13,480 $ 13,142
6/30/98 $ 15,010 $ 15,450 $ 14,542
6/30/99 $ 14,397 $ 15,331 $ 14,653
6/30/00 $ 14,987 $ 15,564 $ 15,060
6/30/01 $ 16,788 $ 17,448 $ 16,544
6/30/02 $ 15,865 $ 18,392 $ 17,184
6/30/03 $ 19,149 $ 22,821 $ 19,609
This chart illustrates the total value of an assumed $10,000 investment in
AllianceBernstein Bond Fund Corporate Bond Portfolio Class A shares (from
6/30/93 to 6/30/03) as compared to the performance of an appropriate
broad-based index and the Lipper Corporate Debt BBB-Rated Funds Average.
Returns do not reflect the deduction of taxes that a shareholder would pay on
fund distributions or the redemption of fund shares. The chart reflects the
deduction of the maximum 4.25% sales charge from the initial $10,000 investment
in the Portfolio and assumes the reinvestment of dividends and capital gains.
Performance for Class B and Class C shares will vary from the results shown
above due to differences in expenses charged to these classes. Past performance
is not indicative of future results, and is not representative of future gain
or loss in capital value or dividend income.
The unmanaged Lehman Brothers Long BAA U.S. Credit Index is a measure of
corporate and non-corporate fixed income securities that are rated investment
grade (Baa by Moody's Investors Service or BBB by Standard & Poor's) and have
at least 10 years to final maturity.
The unmanaged Lipper Corporate Debt BBB-Rated Funds Average reflects
performance of 28 funds (based on the number of funds in the average from
6/30/93 to 6/30/03). These funds have generally similar investment objectives
to AllianceBernstein Bond Fund Corporate Bond Portfolio, although the
investment policies of some funds included in the average may vary.
When comparing AllianceBernstein Bond Fund Corporate Bond Portfolio to the
index and average shown above, you should note that no charges or expenses are
reflected in the performance of the index. Lipper results include fees and
expenses. An investor cannot invest directly in an index or an average, and its
results are not indicative of any specific investment, including
AllianceBernstein Bond Fund Corporate Bond Portfolio.
_______________________________________________________________________________
4 o ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO
PORTFOLIO SUMMARY
June 30, 2003
INCEPTION DATES
Class A Shares
3/11/74
Class B Shares
1/8/93
Class C Shares
5/3/93
PORTFOLIO STATISTICS
Net Assets ($mil): $1,144.5
SECURITY TYPE
6.7% Preferred Stock
1.6% Sovereign Debt
0.4% Yankee Bonds
CORPORATE
14.3% Public Utilities -- Electric & Gas
8.1% Broadcasting/Media
7.9% Communications
5.6% Paper/Packaging [PIE CHART OMITTED]
5.2% Financial
4.9% Communications -- Mobile
4.5% Energy
4.3% Banking
4.3% Automotive
3.9% Cable
3.8% Petroleum Products
3.3% Services
2.8% Insurance
2.8% Aerospace & Defense
2.7% Building/Real Estate
9.8% Other
3.1% Short-Term
All data as of June 30, 2003. The Portfolio's security type breakdown is
expressed as a percentage of total investments and may vary over time. "Other"
represents less than 2.5% weightings in Chemicals, Containers, Entertainment &
Leisure, Food/Beverage, Gaming, Health Care, Hotel/Lodging, Miscellaneous
Industrial, Metals/Mining, Publishing, Retail and Technology.
_______________________________________________________________________________
ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO o 5
INVESTMENT RESULTS
AVERAGE ANNUAL RETURNS AS OF JUNE 30, 2003
Class A Shares
- -------------------------------------------------------------------------------
Without Sales Charge With Sales Charge
1 Year 20.75% 15.67%
5 Years 5.00% 4.09%
10 Years 7.18% 6.71%
SEC Yield* 4.87%
Class B Shares
- -------------------------------------------------------------------------------
Without Sales Charge With Sales Charge
1 Year 19.85% 16.85%
5 Years 4.24% 4.24%
10 Years(a) 6.74% 6.74%
SEC Yield* 4.36%
Class C Shares
- -------------------------------------------------------------------------------
Without Sales Charge With Sales Charge
1 Year 19.85% 18.85%
5 Years 4.23% 4.23%
10 Years 6.43% 6.43%
SEC Yield* 4.37%
The Portfolio's investment results represent average annual returns. Returns do
not reflect the deduction of taxes that a shareholder would pay on fund
distributions or the redemption of fund shares. The returns reflect
reinvestment of dividends and/or capital gains distributions in additional
shares without and with the effect of the 4.25% maximum front-end sales charge
for Class A or applicable contingent deferred sales charge for Class B (3% year
1, 2% year 2, 1% year 3, 0% year 4); and for Class C shares (1% year 1).
Returns for Class A shares do not reflect the imposition of the 1 year, 1%
contingent deferred sales charge for accounts over $1,000,000.
The Portfolio invests a portion of its assets in foreign securities which may
magnify fluctuations, particularly in emerging markets. Price fluctuations may
also be caused by changes in interest rates or bond credit quality ratings.
These changes have a greater effect on bonds with longer maturities than on
those with shorter maturities.
Past performance does not guarantee future results. Investment return and
principal value will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than their original costs.
(a) Assumes conversion of Class B shares into Class A shares after six years.
* SEC Yields are based on SEC guidelines and are calculated on 30 days ended
June 30, 2003.
_______________________________________________________________________________
6 o ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO
PORTFOLIO OF INVESTMENTS
June 30, 2003
Standard Principal
& Poor's Amount
Ratings+ (000) U.S. $ Value
- -------------------------------------------------------------------------------
CORPORATE DEBT OBLIGATIONS-92.1%
Aerospace & Defense-2.9%
BB- L-3 Communications Corp.
6.125%, 7/15/13(a) $ 2,000 $ 2,030,000
BBB Lockheed Martin Corp.
8.50%, 12/01/29 14,000 19,088,300
BBB- Raytheon Co.
5.375%, 4/01/13 6,000 6,358,986
6.75%, 8/15/07 5,000 5,664,860
--------------
33,142,146
--------------
Automotive-4.5%
BB Dana Corp.
10.125%, 3/15/10 2,769 3,066,667
BBB Ford Motor Credit Co.
7.875%, 6/15/10 10,000 10,730,460
BBB General Motors Acceptance Corp.
8.00%, 11/01/31 15,000 14,758,095
BBB General Motors Corp.
8.375%, 7/15/33 17,500 17,258,500
B+ TRW Automotive
9.375%, 2/15/13(a) 3,325 3,624,250
11.00%, 2/15/13(a) 1,655 1,812,225
--------------
51,250,197
--------------
Banking-4.5%
A- ABN Amro
6.523%, 11/08/12(a) 10,000 11,391,010
BBB- Great Western Financial Trust II
8.206%, 2/01/27 24,456 28,188,597
BBB- Greenpoint Bank
9.25%, 10/01/10 9,165 11,656,249
--------------
51,235,856
--------------
Broadcasting/Media-8.4%
BBB+ AOL Time Warner, Inc.
7.625%, 4/15/31 5,000 5,792,205
BB+ British Sky Broadcasting Group Plc
6.875%, 2/23/09 5,000 5,658,030
8.20%, 7/15/09 8,590 10,194,062
BBB- Clear Channel Communications, Inc.
5.75%, 1/15/13 3,500 3,793,703
BBB- News America Holdings
9.25%, 2/01/13 5,000 6,688,230
_______________________________________________________________________________
ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO o 7
Standard Principal
& Poor's Amount
Ratings+ (000) U.S. $ Value
- -------------------------------------------------------------------------------
BBB- News America, Inc.
7.30%, 4/30/28 $ 25,000 $ 28,475,450
B- PanAmSat Corp.
8.50%, 2/01/12 3,250 3,534,375
CCC+ Paxson Communications Corp.
10.75%, 7/15/08 2,200 2,376,000
B Sinclair Broadcast Group, Inc.
8.00%, 3/15/12 4,525 4,853,062
BBB+ Time Warner, Inc.
8.375%, 3/15/23 20,000 25,288,480
--------------
96,653,597
--------------
Building/Real Estate-2.8%
B+ CBRE Escrow, Inc.
9.75%, 5/15/10(a) 765 808,031
BB- KB HOME
7.75%, 2/01/10 2,775 3,014,344
B+ LNR Property Corp.
7.625%, 7/15/13(a) 2,910 2,910,000
BB+ M.D.C. Holdings, Inc.
5.50%, 5/15/13 5,000 5,050,895
BB+ NVR, Inc.
5.00%, 6/15/10 10,000 9,975,000
BBB- Pulte Homes, Inc.
6.375%, 5/15/33 5,000 5,059,980
BB+ The Ryland Group, Inc.
5.375%, 6/01/08 5,000 5,187,500
--------------
32,005,750
--------------
Cable-4.1%
BB- CSC Holdings, Inc.
7.875%, 2/15/18 23,950 24,429,000
BB- EchoStar DBS Corp.
9.375%, 2/01/09 11,785 12,624,681
B+ Insight Midwest LP
9.75%, 10/01/09(a) 2,000 2,125,000
B+ Mediacom Broadband LLC
11.00%, 7/15/13 2,580 2,883,150
BBB- Rogers Cable, Inc.
6.25%, 6/15/13(a) 4,500 4,511,250
--------------
46,573,081
--------------
_______________________________________________________________________________
8 o ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO
Standard Principal
& Poor's Amount
Ratings+ (000) U.S. $ Value
- -------------------------------------------------------------------------------
Chemicals-1.9%
BB+ FMC Corp.
10.25%, 11/01/09 $ 3,470 $ 3,921,100
B- Huntsman International LLC
10.125%, 7/01/09 6,524 6,295,660
BB Lyondell Chemical Co.
9.50%, 12/15/08 10,000 9,550,000
B- Resolution Performance Products
13.50%, 11/15/10 2,524 2,536,620
--------------
22,303,380
--------------
Communications-8.3%
BBB AT&T Broadband Corp.
9.455%, 11/15/22 30,420 41,589,433
BBB+ AT&T Corp.
8.50%, 11/15/31 2,000 2,275,666
BBB+ Koninklijke KPN NV
8.00%, 10/01/10 15,000 18,601,260
BBB- Sprint Capital Corp.
6.875%, 11/15/28 4,445 4,475,413
8.75%, 3/15/32 18,000 21,622,662
BB+ TCI Communications Financing III
9.65%, 3/31/27 5,000 5,975,000
--------------
94,539,434
--------------
Communications - Mobile-5.1%
BBB AT&T Wireless Services, Inc.
7.875%, 3/01/11 5,000 5,915,595
8.125%, 5/01/12 11,500 13,883,030
8.75%, 3/01/31 5,000 6,202,345
B Nextel Communications, Inc.
9.375%, 11/15/09 12,285 13,252,444
9.95%, 2/15/08 11,050 11,602,500
10.65%, 9/15/07 7,556 7,839,350
--------------
58,695,264
--------------
Containers-2.0%
B+ Anchor Glass Container Corp.
11.00%, 2/15/13(a) 2,510 2,754,725
B+ Crown European Holdings, SA
9.50%, 3/01/11(a) 5,225 5,669,125
B+ Greif Bros. Corp. Cl.A
8.875%, 8/01/12 3,800 4,104,000
BBB Sealed Air Corp.
6.875%, 7/15/33(a) 10,000 10,231,200
--------------
22,759,050
--------------
_______________________________________________________________________________
ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO o 9
Standard Principal
& Poor's Amount
Ratings+ (000) U.S. $ Value
- -------------------------------------------------------------------------------
Energy-4.7%
BBB Devon Energy Corp.
7.95%, 4/15/32 $ 10,000 $ 12,914,020
BBB Kerr-McGee Corp.
7.875%, 9/15/31 20,000 24,543,500
BBB Valero Energy Corp.
7.50%, 4/15/32 9,000 10,234,602
8.75%, 6/15/30 5,000 6,425,590
--------------
54,117,712
--------------
Entertainment & Leisure-0.8%
B Six Flags, Inc.
9.50%, 2/01/09 3,125 3,093,750
B- Universal City Development Partners
11.75%, 4/01/10(a) 5,055 5,573,137
--------------
8,666,887
--------------
Financial-5.4%
A- Brascan Corp.
7.375%, 3/01/33 4,500 4,959,000
BBB Cendant Corp.
7.375%, 1/15/13 10,000 11,800,000
BBB+ EOP Operating LP
7.00%, 7/15/11 5,000 5,811,965
B JSG Funding Plc
9.625%, 10/01/12 2,605 2,891,550
BBB MBNA America Bank
7.125%, 11/15/12 5,000 5,867,870
A Ohio National Financial Services, Inc.
6.35%, 4/01/13(a) 5,000 5,300,785
BBB- Safeco Capital Trust I
8.072%, 7/15/37 13,000 15,109,419
A- Transamerica Capital II
7.65%, 12/01/26(a) 10,000 10,133,410
--------------
61,873,999
--------------
Food/Beverage-0.5%
B+ Dole Food Co., Inc.
8.875%, 3/15/11(a) 2,170 2,311,050
B+ Swift & Co.
10.125%, 10/01/09(a) 3,500 3,657,500
--------------
5,968,550
--------------
Gaming-0.3%
BB+ Park Place Entertainment Corp.
9.375%, 2/15/07 3,500 3,885,000
--------------
Healthcare-1.5%
B- Concentra Operating Corp.
13.00%, 8/15/09 2,390 2,605,100
_______________________________________________________________________________
10 o ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO
Standard Principal
& Poor's Amount
Ratings+ (000) U.S. $ Value
- -------------------------------------------------------------------------------
BBB- HCA, Inc.
6.25%, 2/15/13 $ 4,000 $ 4,085,100
6.30%, 10/01/12 5,000 5,120,700
7.125%, 6/01/06 4,500 4,895,339
--------------
16,706,239
--------------
Hotel/Lodging-0.9%
B Corrections Corp. of America
9.875%, 5/01/09 1,155 1,295,044
B Extended Stay America, Inc.
9.875%, 6/15/11 6,250 6,750,000
B+ Intrawest Corp.
9.75%, 8/15/08 2,600 2,726,750
--------------
10,771,794
--------------
Insurance-3.0%
BB Crum & Forster
10.375%, 6/15/13(a) 1,935 1,968,862
BBB- Markel Corp.
6.80%, 2/15/13 10,750 11,715,006
A- Nationwide Mutual Insurance Co.
7.875%, 4/01/33(a) 5,000 5,917,760
8.25%, 12/01/31(a) 5,000 6,199,625
A- Zurich Capital Trust I
8.376%, 6/01/37(a) 7,500 8,266,110
--------------
34,067,363
--------------
Metals/Mining-0.9%
BBB- Inco, Ltd.
7.20%, 9/15/32 5,000 5,528,570
BBB WMC Finance USA
5.125%, 5/15/13(a) 4,000 4,139,152
--------------
9,667,722
--------------
Miscellaneous Industrial-0.3%
B Flowserve Corp.
12.25%, 8/15/10 1,173 1,372,410
BB+ SPX Corp.
7.50%, 1/01/13 2,345 2,550,188
--------------
3,922,598
--------------
Paper/Packaging-5.8%
BB+ Abitibi-Consolidated, Inc.
8.50%, 8/01/29 7,190 7,390,781
8.85%, 8/01/30 7,000 7,461,566
B- Berry Plastics Corp.
10.75%, 7/15/12 3,925 4,337,125
BB+ Bowater, Inc.
6.50%, 6/15/13(a) 5,000 4,752,525
BB+ Georgia-Pacific Corp.
9.375%, 2/01/13(a) 2,500 2,768,750
_______________________________________________________________________________
ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO o 11
Standard Principal
& Poor's Amount
Ratings+ (000) U.S. $ Value
- -------------------------------------------------------------------------------
B+ Graphic Packaging Corp.
8.625%, 2/15/12 $ 2,500 $ 2,562,500
BBB MeadWestvaco Corp.
6.80%, 11/15/32 5,000 5,485,960
BBB Norske Skogindustrier ASA
7.625%, 10/15/11(a) 10,000 11,433,170
B+ Owens-Brockway Glass Container
8.25%, 5/15/13(a) 2,000 2,100,000
8.875%, 2/15/09 7,660 8,349,400
B+ Plastipak Holdings, Inc.
10.75%, 9/01/11 1,961 2,108,075
B- Pliant Corp.
13.00%, 6/01/10 1,980 1,871,100
B Smurfit-Stone Container Corp.
8.25%, 10/01/12 4,205 4,530,887
B Stone Container Corp.
9.75%, 2/01/11 1,625 1,787,500
--------------
66,939,339
--------------
Petroleum Products-4.0%
BBB Amerada Hess Corp.
7.875%, 10/01/29 10,000 12,208,590
BB- CITGO Petroleum Corp.
11.375%, 2/01/11(a) 5,000 5,600,000
BBB- Pemex Project Funding Master Trust
7.375%, 12/15/14(a)(b) 10,000 10,975,000
8.625%, 2/01/22(a)(b) 10,000 11,450,000
BBB- PF Export Receivables Master Trust
Series A
6.436%, 6/01/15(a) 5,000 5,075,000
--------------
45,308,590
--------------
Public Utilities - Electric & Gas-15.0%
BBB American Electric Power Co., Inc.
Series C
5.375%, 3/15/10 5,000 5,353,235
BBB- Calenergy Co., Inc.
8.48%, 9/15/28 30,000 39,662,550
BBB CenterPoint Energy Resources Corp.
7.875%, 4/01/13(a) 29,935 34,492,783
BBB Cincinnati Gas & Electric Co.
Series B
5.375%, 6/15/33 6,000 5,767,344
_______________________________________________________________________________
12 o ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO
Standard Principal
& Poor's Amount
Ratings+ (000) U.S. $ Value
- -------------------------------------------------------------------------------
BBB- Dominion Resources Capital Trust III
8.40%, 1/15/31 $ 29,000 $ 36,520,106
BBB- FirstEnergy Corp.
Series A
5.50%, 11/15/06 1,570 1,684,579
BBB- FirstEnergy Corp.
7.375%, 11/15/31 16,455 18,500,258
BBB Nisource Finance Corp.
7.875%, 11/15/10 15,000 17,735,940
BBB- Oncor Electric Delivery Co.
7.00%, 9/01/22 5,000 5,591,825
NR PG&E Corp.
6.875%, 7/15/08(a) 1,335 1,381,725
BB SEMCO Energy, Inc.
7.125%, 5/15/08(a) 415 435,750
7.75%, 5/15/13(a) 1,585 1,695,950
B+ The AES Corp.
8.75%, 5/15/13(a) 955 997,975
9.00%, 5/15/15(a) 1,565 1,643,250
--------------
171,463,270
--------------
Publishing-0.4%
B Dex Media East LLC
9.875%, 11/15/09 4,000 4,480,000
--------------
Retail-0.5%
BBB+ Limited Brands
6.125%, 12/01/12 5,000 5,534,630
--------------
Services-3.4%
B+ Allied Waste North America, Inc.
10.00%, 8/01/09 6,500 6,938,750
B Iron Mountain, Inc.
8.625%, 4/01/13 2,000 2,150,000
BB- Service Corp.
6.00%, 12/15/05 2,500 2,531,250
7.70%, 4/15/09 2,500 2,562,500
BBB Waste Management, Inc.
7.75%, 5/15/32 20,000 25,147,920
--------------
39,330,420
--------------
Technology-0.2%
B ON Semiconductor Corp.
12.00%, 3/15/10 2,500 2,787,500
--------------
Total Corporate Debt Obligations
(cost $952,116,940) 1,054,649,368
--------------
_______________________________________________________________________________
ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO o 13
Shares or
Standard Principal
& Poor's Amount
Ratings+ (000) U.S. $ Value
- -------------------------------------------------------------------------------
PREFERRED STOCKS-7.0%
Banking-2.7%
A- BNY Capital V
Series F 400 $ 10,304,000
BBB Equity Residential
Series N 200 4,987,500
BBB+ Wachovia Corp.
Series A 200 5,556,260
A- Wells Fargo Capital Trust VII 400 10,274,660
--------------
31,122,420
--------------
Communications-3.0%
BBB+ Centaur Funding Corp.
Series B(a) 28 34,049,120
--------------
Financial-1.3%
A2 Household Finance Corp.(c) 545 14,813,100
--------------
Total Preferred Stocks
(cost $72,800,564) 79,984,640
--------------
SOVEREIGN DEBT OBLIGATIONS-1.6%
Mexico-1.6%
BBB- United Mexican States
6.375%, 1/16/13 (b) $ 9,000 9,553,500
8.00%, 9/24/22 (b) 8,000 9,030,000
--------------
Total Sovereign Debt Obligations
(cost $16,617,376) 18,583,500
--------------
YANKEE BONDS-0.5%
BBB TPSA Finance BV
7.75%, 12/10/08(a)
(cost $4,880,962) 4,500 5,220,000
--------------
SHORT-TERM INVESTMENTS-3.3%
Time Deposit-2.9%
A-1+ Societe Generale Cayman Islands
1.31%, 7/01/03 32,700 32,700,000
--------------
U.S. Treasury Bills-0.4%
AAA U.S. Treasury Bills
Zero coupon, 7/24/03 750 749,506
Zero coupon, 8/07/03(d) 4,000 3,995,581
--------------
4,745,087
--------------
Total Short-Term Investments
(cost $37,445,087) 37,445,087
--------------
_______________________________________________________________________________
14 o ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO
U.S. $ Value
- -------------------------------------------------------------------------------
Total Investments-104.5%
(cost $1,083,860,929) $1,195,882,595
Other assets less liabilities*-(4.5%) (51,387,171)
--------------
Net Assets-100% $1,144,495,424
==============
* SECURITIES LENDING INFORMATION
Includes cash collateral received of $92,687,120 (representing 8.1% of net
assets) for securities on loan as of June 30, 2003 (see Note E). The lending
agent invested the cash collateral in short-term investments and interest
received on these investments as follows:
PRINCIPAL
CURRENT AMOUNT
SHORT-TERM INVESTMENTS YIELD (000) U.S.$ VALUE
======== ============= ==============
CC USA, 6/14/04 1.06% $ 25,000 $ 24,998,750
Gotham Funding, 7/07/03 1.30 25,000 24,971,111
ZCM Matched Funding, 7/11/03 1.21 25,000 24,974,792
SHARES
=============
UBS Private Money Market Fund, LLC 1.15% 17,751,288 17,751,288
------------
Total Short-Term Investments $ 92,695,941
============
FINANCIAL FUTURES CONTRACTS SOLD (see Note D)
VALUE AT
NUMBER OF EXPIRATION ORIGINAL JUNE 30, UNREALIZED
TYPE CONTRACTS MONTH VALUE 2003 APPRECIATION
============ ========= =========== ============= ============= ============
U.S.Treasury
Note 5 Yr September
Futures 3,016 2003 $347,959,847 $347,217,000 $ 742,847
REVERSE REPURCHASE AGREEMENTS (see Note D)
BROKER INTEREST RATE MATURITY AMOUNT
================= ================= ================= =================
Deutsche Bank 1.35% 7/01/03 $ 8,441,265
Deutsche Bank 1.30 12/31/03 11,635,420
Deutsche Bank 1.30 12/31/03 10,955,395
Deutsche Bank 1.00 12/31/03 9,814,773
------------
$ 40,846,853
------------
(a) Security is exempt from Registration under Rule 144A of the Securities Act
of 1933. This security may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At June 30, 2003,
the aggregate market value of these securities amounted to $235,405,205 or
20.6% of net assets.
(b) Positions, or portions thereof, with an aggregate market value of
$41,008,500 have been segregated to collateralize reverse repurchase
agreements.
(c) Moody's Rating (unaudited)
(d) Position with a market value of $3,995,581 has been segregated to
collateralize margin requirements for the open futures contracts.
+ Unaudited
Glossary:
NR - Rating not applied for
See notes to financial statements.
_______________________________________________________________________________
ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO o 15
STATEMENT OF ASSETS & LIABILITIES
June 30, 2003
ASSETS
Investments in securities, at value (cost $1,083,860,929) $1,195,882,595(a)
Cash 254,196
Collateral held for securities loaned 92,687,120
Interest receivable 19,088,869
Receivable for investment securities sold 14,115,348
Receivable for capital stock sold 5,439,033
--------------
Total assets 1,327,467,161
--------------
LIABILITIES
Payable for collateral received on securities loaned 92,687,120
Payable for reverse repurchase agreements 40,846,853
Payable for investment securities purchased 38,384,442
Payable for capital stock redeemed 6,946,705
Dividends payable 1,692,217
Payable for variation margin on futures contracts 801,125
Distribution fee payable 630,343
Advisory fee payable 529,696
Accrued expenses 453,236
--------------
Total liabilities 182,971,737
--------------
Net Assets $1,144,495,424
==============
COMPOSITION OF NET ASSETS
Capital stock, at par $ 95,202
Additional paid-in capital 1,414,860,994
Distributions in excess of net investment income (2,436,049)
Accumulated net realized loss on investment transactions (380,789,236)
Net unrealized appreciation of investments 112,764,513
--------------
$1,144,495,424
==============
CALCULATION OF MAXIMUM OFFERING PRICE
Class A Shares
Net asset value and redemption price per share
($555,978,916 / 46,229,283 shares of capital stock
issued and outstanding) $12.03
Sales charge--4.25% of public offering price .53
------
Maximum offering price $12.56
======
Class B Shares
Net asset value and offering price per share
($418,095,115 / 34,796,170 shares of capital stock
issued and outstanding) $12.02
======
Class C Shares
Net asset value and offering price per share
($168,123,652 / 13,985,756 shares of capital stock
issued and outstanding) $12.02
======
Advisor Class Shares
Net asset value, redemption and offering price per share
($2,297,741 / 190,925 shares of capital stock issued
and outstanding) $12.03
======
(a) Includes securities on loan with a value of $89,198,686 (see Note E).
See notes to financial statements.
_______________________________________________________________________________
16 o ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO
STATEMENT OF OPERATIONS
Year Ended June 30, 2003
INVESTMENT INCOME
Interest $ 85,957,808
Dividends 3,583,948 $ 89,541,756
------------
EXPENSES
Advisory fee 6,127,526
Distribution fee -- Class A 1,554,225
Distribution fee -- Class B 4,195,104
Distribution fee -- Class C 1,619,502
Transfer agency 2,090,187
Printing 414,642
Custodian 258,504
Administrative 125,000
Registration fees 89,002
Audit and legal 72,429
Directors' fees 19,728
Miscellaneous 64,085
------------
Total expenses before interest 16,629,934
Interest expense 327,763
------------
Total expenses 16,957,697
Less: expense offset arrangement
(see Note B) (1,897)
------------
Net expenses 16,955,800
------------
Net investment income 72,585,956
------------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENT TRANSACTIONS
Net realized loss on:
Investment transactions (38,974,852)
Futures contracts (12,430,731)
Net change in unrealized appreciation/
depreciation of:
Investments 179,649,612
Futures contracts 742,847
------------
Net gain on investment transactions 128,986,876
------------
NET INCREASE IN NET ASSETS FROM
OPERATIONS $201,572,832
============
See notes to financial statements.
_______________________________________________________________________________
ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO o 17
STATEMENT OF CHANGES IN NET ASSETS
Year Ended Year Ended
June 30, 2003 June 30, 2002
============== ==============
INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS
Net investment income $ 72,585,956 $ 94,617,332
Net realized loss on investment
transactions (51,405,583) (115,606,822)
Net change in unrealized appreciation/
depreciation of investments 180,392,459 (54,000,835)
-------------- --------------
Net increase (decrease) in net assets from
operations 201,572,832 (74,990,325)
DIVIDENDS AND DISTRIBUTIONS TO
SHAREHOLDERS FROM
Net investment income
Class A (35,897,785) (43,343,570)
Class B (26,405,194) (37,442,989)
Class C (10,193,042) (13,830,773)
Advisor Class (69,827)) -0-
Distributions in excess of net investment
income
Class A -0- (277,384)
Class B -0- (239,622)
Class C -0- (88,514)
Advisor Class -0- -0-
Tax return of capital
Class A (1,251,077) (1,954,848)
Class B (920,250) (1,688,725)
Class C (355,239) (623,785)
Advisor Class (2,434) -0-
CAPITAL STOCK TRANSACTIONS
Net increase (decrease) (140,779,501) 107,857,059
-------------- --------------
Total decrease (14,301,517) (66,623,476)
NET ASSETS
Beginning of period 1,158,796,941 1,225,420,417
-------------- --------------
End of period $1,144,495,424 $1,158,796,941
============== ==============
See notes to financial statements.
_______________________________________________________________________________
18 o ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO
NOTES TO FINANCIAL STATEMENTS
June 30, 2003
NOTE A
Significant Accounting Policies
AllianceBernstein Bond Fund, Inc. (the "Fund"), formerly Alliance Bond Fund,
Inc., is registered under the Investment Company Act of 1940 as a diversified,
open-end management investment company. The Fund, which is a Maryland
corporation, operates as a series company currently comprised of three
portfolios: the Corporate Bond Portfolio, the Quality Bond Portfolio and the
U.S. Government Portfolio. Each series is considered to be a separate entity
for financial reporting and tax purposes. This report relates only to the
Corporate Bond Portfolio. The Corporate Bond Portfolio (the "Portfolio") offers
Class A, Class B, Class C and Advisor Class shares. Class A shares are sold
with a front-end sales charge of up to 4.25% for purchases not exceeding
$1,000,000. With respect to purchases of $1,000,000 or more, Class A shares
redeemed within one year of purchase may be subject to a contingent deferred
sales charge of 1%. Class B shares are currently sold with a contingent
deferred sales charge which declines from 3% to zero depending on the period of
time the shares are held. Class B shares will automatically convert to Class A
shares six years after the end of the calendar month of purchase. Class C
shares are subject to a contingent deferred sales charge of 1% on redemptions
made within the first year after purchase. Advisor Class shares are sold
without an initial or contingent deferred sales charge and are not subject to
ongoing distribution expenses. Advisor Class shares are offered to investors
participating in fee-based programs and certain retirement plan accounts. All
four classes of shares have identical voting, dividend, liquidation and other
rights, except that each class bears different distribution expenses and has
exclusive voting rights with respect to its distribution plan. The financial
statements have been prepared in conformity with accounting principles
generally accepted in the United States which require management to make
certain estimates and assumptions that affect the reported amounts of assets
and liabilities in the financial statements and amounts of income and expenses
during the reporting period. Actual results could differ from those estimates.
Additional information about some of the items discussed in these Notes to
Financial Statements is contained in the Fund's Statement of Additional
Information, which is available upon request. The following is a summary of
significant accounting policies followed by the Portfolio.
1. Security Valuation
In accordance with Pricing Policies adopted by the Board of Directors of the
Fund (the "Pricing Policies") and applicable law, portfolio securities are
valued at current market value or at fair value. The Board of Directors has
delegated to the Adviser, subject to the Board's continuing oversight, certain
responsibilities with respect to the implementation of the Pricing Policies.
Pursuant to the Pricing Policies, securities for which market quotations are
readily available are valued at their current market value. In general, the
market value of these securities is determined as follows:
_______________________________________________________________________________
ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO o 19
Securities listed on a national securities exchange or on a foreign securities
exchange are valued at the last sale price at the close of the exchange or
foreign securities exchange. If there has been no sale on such day, the
securities are valued at the mean of the closing bid and asked prices on such
day. If no bid or asked prices are quoted on such day, then the security is
valued in good faith at fair value in accordance with the Pricing Policies.
Securities listed on more than one exchange are valued by reference to the
principal exchange on which the securities are traded; securities not listed on
an exchange but traded on The Nasdaq Stock Market, Inc. ("NASDAQ") are valued
in accordance with the NASDAQ Official Closing Price; listed put or call
options are valued at the last sale price. If there has been no sale on that
day, such securities will be valued at the closing bid prices on that day; open
futures contracts and options thereon are valued using the closing settlement
price or, in the absence of such a price, the most recent quoted bid price. If
there are no quotations available for the day of valuations, the last available
closing settlement price is used; securities traded in the over-the-counter
market,(but excluding securities traded on NASDAQ) are valued at the mean of
the current bid and asked prices as reported by the National Quotation Bureau
or other comparable sources; U.S. Government securities and other debt
instruments having 60 days or less remaining until maturity are valued at
amortized cost if their original maturity was 60 days or less, or by amortizing
their fair value as of the 61st day prior to maturity if their original term to
maturity exceeded 60 days; fixed-income securities, including mortgage backed
and asset backed securities, may be valued on the basis of prices provided by a
pricing service or at a price obtained from one or more of the major
broker/dealers. In cases where broker/dealer quotes are obtained, the Pricing
Policies provide that the Adviser may establish procedures whereby changes in
market yields or spreads are used to adjust, on a daily basis, a recently
obtained quoted price on a security; and OTC and other derivatives are valued
on the basis of a quoted bid price or spread from a major broker/dealer in such
security. Securities for which market quotations are not readily available are
valued at fair value in accordance with the Pricing Policies.
2. Taxes
It is the policy of the Portfolio to meet the requirements of the Internal
Revenue Code applicable to regulated investment companies and to distribute all
of its investment company taxable income and net realized gains, if any, to
shareholders. Therefore, no provisions for federal income or excise taxes are
required.
3. Investment Income and Investment Transactions
Dividend income is recorded on the ex-dividend date. Interest income is accrued
daily. Investment transactions are accounted for on the trade date securities
are purchased or sold. Investment gains and losses are determined on the
identified cost basis. The Portfolio accretes discounts as adjustments to
interest income. Additionally, the Portfolio amortizes premiums on debt
securities for financial statement reporting purposes.
_______________________________________________________________________________
20 o ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO
4. Income and Expenses
All income earned and expenses incurred by the Portfolio are borne on a
pro-rata basis by each settled class of shares, based on proportionate interest
in the Portfolio represented by the net assets of such class, except that the
Portfolio's Class B and Class C shares bear higher distribution and transfer
agent fees than Class A and Advisor Class shares. Advisor Class shares have no
distribution fees.
5. Dividends and Distributions
Dividends and distributions to shareholders are recorded on the ex-dividend
date. Income dividends and capital gains distributions are determined in
accordance with federal tax regulations and may differ from those determined in
accordance with accounting principles generally accepted in the United States.
To the extent these differences are permanent, such amounts are reclassified
within the capital accounts based on their federal tax basis treatment;
temporary differences do not require such reclassification.
NOTE B
Advisory Fee and Other Transactions with Affiliates
Under the terms of an investment advisory agreement, the Portfolio pays
Alliance Capital Management L.P. (the "Adviser"), an advisory fee at an annual
rate of .625 of 1% of the first $500 million and .50 of 1% in excess of $500
million of the Portfolio's average daily net assets. The fee is accrued daily
and paid monthly.
Pursuant to the advisory agreement, the Portfolio paid $125,000 to the Adviser
representing the cost of certain legal and accounting services provided to the
Portfolio by the Adviser for the year ended June 30, 2003.
The Portfolio compensates Alliance Global Investor Services, Inc. (AGIS), a
wholly-owned subsidiary of the Adviser, under a Transfer Agency Agreement for
providing personnel and facilities to perform transfer agency services for the
Portfolio. Such compensation amounted to $1,366,013 for the year ended June 30,
2003.
For the year ended June 30, 2003, the Portfolio's expenses were reduced by
$1,897 under an expense offset arrangement with AGIS.
AllianceBernstein Investment Research and Management, Inc. (the "Distributor"),
formerly Alliance Fund Distributors, Inc., a wholly-owned subsidiary of the
Adviser, serves as the distributor of the Portfolio's shares. The Distributor
has advised the Portfolio that it has received front-end sales charges of
$29,192 from the sales of Class A shares and $9,048, $598,146 and $46,997 in
contingent deferred sales charges imposed upon redemptions by shareholders of
Class A, Class B and Class C shares, respectively, for the year ended June 30,
2003.
_______________________________________________________________________________
ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO o 21
NOTE C
Distribution Services Agreement
The Portfolio has adopted a Distribution Services Agreement (the "Agreement")
pursuant to Rule 12b-1 under the Investment Company Act of 1940. Under the
Agreement, the Portfolio pays distribution and servicing fees to the
Distributor at an annual rate of up to .30 of 1% of the Portfolio's average
daily net assets attributable to Class A shares and 1% of the average daily net
assets attributable to both Class B and Class C shares. There are no
distribution and servicing fees on the Advisor Class shares. The fees are
accrued daily and paid monthly. The Agreement provides that the Distributor
will use such payments in their entirety for distribution assistance and
promotional activities. The Distributor has advised the Portfolio that it has
incurred expenses in excess of the distribution costs reimbursed by the
Portfolio in the amount of $14,090,845 and $5,063,258 for Class B and Class C
shares, respectively. Such costs may be recovered from the Portfolio in future
periods so long as the Agreement is in effect. In accordance with the
Agreement, there is no provision for recovery of unreimbursed distribution
costs incurred by the Distributor beyond the current fiscal year for Class A
shares. The Agreement also provides that the Adviser may use its own resources
to finance the distribution of the Portfolio's shares.
NOTE D
Investment Transactions
Purchases and sales of investment securities (excluding short-term investments)
for the year ended June 30, 2003, were as follows:
Purchases Sales
============== ==============
Investment securities (excluding U.S.
government securities) $1,184,651,064 $ 833,867,209
U.S. government securities 699,367,908 1,157,989,497
At June 30, 2003, the cost of investments for federal income tax purposes,
gross unrealized appreciation and unrealized depreciation (excluding futures)
are as follows:
Cost $1,085,416,856
--------------
Gross unrealized appreciation 113,224,360
Gross unrealized depreciation (2,758,621)
--------------
Net unrealized appreciation $ 110,465,739
--------------
1. Financial Futures Contracts
The Portfolio may buy or sell financial futures contracts for the purpose of
hedging its portfolio against adverse effects of anticipated movements in the
market. The Portfolio bears the market risk that arises from changes in the
value of these financial instruments and the imperfect correlation between
movements in the price of the futures contracts and movements in the price of
the securities hedged or used for cover.
_______________________________________________________________________________
22 o ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO
At the time the Portfolio enters into a futures contract, the Portfolio
deposits and maintains as collateral an initial margin as required by the
exchange on which the transaction is affected. Pursuant to the contract, the
Portfolio agrees to receive from or pay to the broker an amount of cash equal
to the daily fluctuation in the value of the contract. Such receipts or
payments are known as variation margin and are recorded by the Portfolio as
unrealized gains or losses. Risks may arise from the potential inability of a
counterparty to meet the terms of the contract. When the contract is closed,
the Portfolio records a realized gain or loss equal to the difference between
the value of the contract at the time it was opened and the time it was closed.
2. Option Transactions
For hedging and investment purposes, the Portfolio may purchase and write
(sell) put and call options on U.S. and foreign government securities and
foreign currencies that are traded on U.S. and foreign securities exchanges and
over-the-counter markets.
The risk associated with purchasing an option is that the Portfolio pays a
premium whether or not the option is exercised. Additionally, the Portfolio
bears the risk of loss of premium and change in market value should the
counterparty not perform under the contract. Put and call options purchased are
accounted for in the same manner as portfolio securities. The cost of
securities acquired through the exercise of call options is increased by
premiums paid. The proceeds from securities sold through the exercise of put
options are decreased by the premiums paid.
When the Portfolio writes an option, the premium received by the Portfolio is
recorded as a liability and is subsequently adjusted to the current market
value of the option written. Premiums received from writing options which
expire unexercised are recorded by the Portfolio on the expiration date as
realized gains from options written. The difference between the premium
received and the amount paid on effecting a closing purchase transaction,
including brokerage commissions, is also treated as a realized gain, or if the
premium received is less than the amount paid for the closing purchase
transaction, as a realized loss. If a call option is exercised, the premium
received is added to the proceeds from the sale of the underlying security in
determining whether the Portfolio has realized a gain or loss. If a put option
is exercised, the premium received reduces the cost basis of the security
purchased by the Portfolio. In writing an option, the Portfolio bears the
market risk of an unfavorable change in the price of the security underlying
the written option. Exercise of an option written by the Portfolio could result
in the Portfolio selling or buying a security at a price different from the
current market value.
3. Swap Agreements
The Portfolio may enter into swaps on sovereign debt obligations to protect
itself from interest rate fluctuations on the underlying debt instruments and
for invest-
_______________________________________________________________________________
ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO o 23
ment purposes. A swap is an agreement that obligates two parties to exchange a
series of cash flows at specified intervals based upon or calculated by
reference to changes in specified prices or rates for a specified amount of an
underlying asset. The payment flows are usually netted against each other, with
the difference being paid by one party to the other.
Risks may arise as a result of the failure of the counterparty to the swap
contract to comply with the terms of the swap contract. The loss incurred by
the failure of a counterparty is generally limited to the net interest payment
to be received by the Portfolio, and/or the termination value at the end of the
contract. Therefore, the Portfolio considers the creditworthiness of each
counterparty to a swap contract in evaluating potential credit risk.
Additionally, risks may arise from unanticipated movements in interest rates or
in the value of the underlying securities.
The Portfolio records a net receivable or payable on a daily basis for the net
interest income or expense expected to be received or paid during the interest
period. Net interest received or paid on these contracts is recorded as
interest income (or as an offset to interest income). Fluctuations in the value
of swap contracts are recorded for financial statement purposes as a component
of net change in unrealized appreciation/depreciation of investments. Realized
gains and losses from terminated swap contracts are included in net realized
gain or loss on investment transactions.
4. Reverse Repurchase Agreements
Under a reverse repurchase agreement, the Portfolio sells securities and agrees
to repurchase them at a mutually agreed upon date and price. At the time the
Portfolio enters into a reverse repurchase agreement, it will establish a
segregated account with the custodian containing liquid assets having a value
at least equal to the repurchase price.
For the year ended June 30, 2003, the average amount of reverse repurchase
agreements outstanding was $25,494,813 and the daily weighted average interest
rate was 1.64%.
NOTE E
Securities Lending
The Portfolio has entered into a securities lending agreement with AG Edwards &
Sons, Inc., (the"Lending Agent"). Under the terms of the agreement, the Lending
Agent, on behalf of the Portfolio, administers the lending of portfolio
securities to certain broker-dealers. In return, the Portfolio receives fee
income from the lending transactions or it retains a portion of interest on the
investment of any cash received as collateral. The Portfolio also continues to
receive dividends or interest on the securities loaned. Unrealized gain or loss
on the value of the securities loaned that may occur during the term of the
loan will be reflected in the accounts of the Portfolio. All loans are
continuously secured by collateral exceeding the value of the securities
loaned. All collateral consists of either cash
_______________________________________________________________________________
24 o ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO
or U.S. government securities. The Lending Agent may invest the cash collateral
received in accordance with the investment restrictions of the Portfolio in one
or more of the following investments: U.S. government or U.S. government agency
obligations, bank obligations, corporate debt obligations, asset-backed
securities, investment funds, structured products, repurchase agreements and an
eligible money market fund. The Lending Agent will indemnify the Portfolio for
any loss resulting from a borrower's failure to return a loaned security when
due. As of June 30, 2003, the Portfolio had loaned securities with a value of
$89,198,686 and received cash collateral of $92,687,120 which was invested in
short-term securities as included in the footnotes to the accompanying
portfolio of investments. For the year ended June 30, 2003, the Portfolio
earned fee income of $252,967 which is included in interest income in the
accompanying statement of operations.
NOTE F
Capital Stock
There are 12,000,000,000 shares of $.001 par value capital stock authorized,
divided into four classes, designated Class A, Class B, Class C and Advisor
Class shares. Each class consists of 3,000,000,000 authorized shares.
Transactions in capital stock were as follows:
Shares Amount
--------------------------- ------------------------------
Year Ended Year Ended Year Ended Year Ended
June 30, June 30, June 30, June 30,
2003 2002 2003 2002
------------ ------------ -------------- --------------
CLASS A
Shares sold 14,552,214 17,526,462 $ 185,571,781 $ 211,137,765
- -------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends and
distributions 2,138,633 2,351,837 23,617,128 28,093,903
- -------------------------------------------------------------------------------
Shares converted
from Class B 5,513,902 2,816,769 36,289,286 33,551,898
- -------------------------------------------------------------------------------
Shares redeemed (24,652,867) (17,165,859) (271,702,238) (205,172,093)
- -------------------------------------------------------------------------------
Net increase
(decrease) (2,448,118) 5,529,209 $ (26,224,043) $ 67,611,473
===============================================================================
CLASS B
Shares sold 6,602,364 14,019,337 $ 73,365,336 $ 169,590,699
- -------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends and
distributions 1,355,293 1,812,162 14,932,280 21,677,353
- -------------------------------------------------------------------------------
Shares converted
to Class A (5,511,083) (2,817,044) (36,289,286) (33,551,898)
- -------------------------------------------------------------------------------
Shares redeemed (10,500,542) (11,640,615) (139,384,003) (138,718,474)
- -------------------------------------------------------------------------------
Net increase
(decrease) (8,053,968) 1,373,840 $ (87,375,673) $ 18,997,680
===============================================================================
_______________________________________________________________________________
ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO o 25
Shares Amount
--------------------------- ------------------------------
Year Ended Year Ended Year Ended Year Ended
June 30, June 30, June 30, June 30,
2003 2002 2003 2002
------------ ------------ -------------- --------------
CLASS C
Shares sold 3,130,196 6,102,894 $ 34,950,768 $ 73,519,678
- -------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends and
distributions 476,779 671,626 5,255,130 8,042,057
- -------------------------------------------------------------------------------
Shares redeemed (6,386,613) (5,056,101) (69,528,339) (60,313,829)
- -------------------------------------------------------------------------------
Net increase
(decrease) (2,779,638) 1,718,419 $ (29,322,441) $ 21,247,906
===============================================================================
Shares Amount
-------------- --------------
August 8, August 8,
2002(a) 2002(a)
to June 30, to June 30,
2003 2003
-------------- --------------
ADVISOR CLASS
Shares sold 424,628 $ 4,825,230
- -------------------------------------------------------------------------------
Shares issued in reinvestment of dividends
and distributions 5,258 60,857
- -------------------------------------------------------------------------------
Shares redeemed (238,961) (2,743,431)
- -------------------------------------------------------------------------------
Net increase 190,925 $ 2,142,656
===============================================================================
(a) Commencement of distribution.
NOTE G
Joint Credit Facility
A number of open-end mutual funds managed by the Adviser, including the
Portfolio, participate in a $750 million revolving credit facility (the
"Facility") to provide short-term financing if necessary, in connection with
abnormal redemption activity. Commitment fees related to the Facility are paid
by the participating funds and are included in the miscellaneous expenses in
the statement of operations. The Portfolio did not utilize the Facility during
the year ended June 30, 2003.
NOTE H
Concentration of Risk
Investing in securities of foreign companies and foreign governments involves
special risks which include the possibility of future political and economic
developments which could adversely affect the value of such securities.
Moreover, securities of many foreign companies and foreign governments and
their markets may be less liquid and their prices more volatile than those of
comparable U.S. companies and the United States Government.
_______________________________________________________________________________
26 o ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO
NOTE I
Distributions to Shareholders
The tax character of distributions paid during the fiscal years ended June 30,
2003 and June 30, 2002 were as follows:
2003 2002
============= =============
Distributions paid from:
Ordinary income $ 72,565,848 $ 94,986,020
------------- -------------
Total taxable distributions 72,565,848 94,986,020
Tax return of capital 2,529,000 4,267,358
------------- -------------
Total distributions paid $ 75,094,848 $ 99,253,378(a)
============= =============
As of June 30, 2003, the components of accumulated earnings/(deficit) on a tax
basis were as follows:
Accumulated capital and other losses $(379,234,294)(b)
-------------
Unrealized appreciation/(depreciation) 110,465,739(c)
-------------
Total accumulated earnings/(deficit) $(268,768,555)
=============
(a) Total distributions paid differ from the statement of changes in net
assets because for tax purposes dividends are recognized when actually paid.
(b) On June 30, 2003, the Portfolio had a net capital loss carryforward of
$379,234,294, of which $3,517,339 expires in the year 2004, $8,737,781 expires
in the year 2007, $125,726,446 expires in the year 2008, $54,554,000 expires in
the year 2009, $52,066,319 expires in the year 2010, and $134,632,409 expires
in the year 2011. To the extent future capital gains are offset by capital loss
carryforwards, such gains will not be distributed. During the fiscal year ended
June 30, 2003, $2,817,216 of capital loss carryforwards expired.
(c) The differences between book-basis and tax-basis unrealized
appreciation/(depreciation) are attributable primarily to the tax deferral of
losses on wash sales and the difference between book and tax amortization
methods for premiums.
During the current fiscal year, permanent differences, primarily due to a tax
return of capital, expiration of capital loss carryforwards and the tax
treatment of bond premium, resulted in a net decrease in distributions in
excess of net investment income, a decrease in accumulated net realized loss on
investments and a decrease in additional paid-in capital. This reclassification
had no effect on net assets.
_______________________________________________________________________________
ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO o 27
FINANCIAL HIGHLIGHTS
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
Class A
---------------------------------------------------------------
Year Ended June 30,
---------------------------------------------------------------
2003 2002(a) 2001 2000 1999
----------- ----------- ----------- ----------- -----------
Net asset value, beginning of
period $10.70 $12.29 $11.91 $12.49 $14.19
INCOME FROM INVESTMENT
OPERATIONS
Net investment income(b) .77 .94 .97 1.04 1.06
Net realized and unrealized
gain (loss) on investment
transactions 1.35 (1.55) .42 (.55) (1.64)
Net increase (decrease) in net
asset value from
operations 2.12 (.61) 1.39 .49 (.58)
LESS: DIVIDENDS AND
DISTRIBUTIONS
Dividends from net
investment income (.76) (.94) (.97) (1.04) (1.07)
Distributions in excess of net
investment income -0- -0- (.01) -0- (.01)
Tax return of capital (.03) (.04) (.03) (.03) (.04)
Total dividends and
distributions (.79) (.98) (1.01) (1.07) (1.12)
Net asset value, end of
period $12.03 $10.70 $12.29 $11.91 $12.49
TOTAL RETURN
Total investment return based
on net asset value(c) 20.75% (5.51)% 12.03% 4.11% (4.08)%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(000's omitted) $555,979 $520,984 $530,446 $473,578 $476,141
Ratio to average net assets of:
Expenses 1.16% 1.12% 1.31% 1.12% 1.11%
Expenses, excluding
interest expense 1.13% 1.09% 1.09% 1.11% 1.11%
Net investment income 6.96% 7.79% 7.95% 8.51% 8.13%
Portfolio turnover rate 171% 276% 340% 302% 281%
See footnote summary on page 31.
_______________________________________________________________________________
28 o ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
Class B
---------------------------------------------------------------
Year Ended June 30,
---------------------------------------------------------------
2003 2002(a) 2001 2000 1999
----------- ----------- ----------- ----------- -----------
Net asset value, beginning of
period $10.70 $12.30 $11.92 $12.49 $14.19
INCOME FROM INVESTMENT
OPERATIONS
Net investment income(b) .69 .85 .88 .95 .97
Net realized and unrealized
gain (loss) on investment
transactions 1.35 (1.55) .42 (.54) (1.64)
Net increase (decrease) in net
asset value from
operations 2.04 (.70) 1.30 .41 (.67)
LESS: DIVIDENDS AND
DISTRIBUTIONS
Dividends from net
investment income (.70) (.85) (.88) (.95) (.98)
Distributions in excess of net
investment income -0- (.01) (.01) -0- (.01)
Tax return of capital (.02) (.04) (.03) (.03) (.04)
Total dividends and
distributions (.72) (.90) (.92) (.98) (1.03)
Net asset value, end of
period $12.02 $10.70 $12.30 $11.92 $12.49
TOTAL RETURN
Total investment return based
on net asset value(c) 19.85% (6.23)% 11.24% 3.39% (4.77)%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(000's omitted) $418,095 $458,394 $509,953 $477,259 $630,631
Ratio to average net assets of:
Expenses 1.88% 1.83% 2.03% 1.83% 1.82%
Expenses, excluding
interest expense 1.85% 1.80% 1.81% 1.83% 1.82%
Net investment income 6.27% 7.05% 7.18% 7.77% 7.41%
Portfolio turnover rate 171% 276% 340% 302% 281%
See footnote summary on page 31.
_______________________________________________________________________________
ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO o 29
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
Class C
---------------------------------------------------------------
Year Ended June 30,
---------------------------------------------------------------
2003 2002(a) 2001 2000 1999
----------- ----------- ----------- ----------- -----------
Net asset value, beginning of
period $10.70 $12.30 $11.91 $12.49 $14.19
INCOME FROM INVESTMENT
OPERATIONS
Net investment income(b) .69 .85 .89 .94 .97
Net realized and unrealized
gain (loss) on investment
transactions 1.35 (1.55) .42 (.54) (1.64)
Net increase (decrease) in net
asset value from
operations 2.04 (.70) 1.31 .40 (.67)
LESS: DIVIDENDS AND
DISTRIBUTIONS
Dividends from net
investment income (.70) (.85) (.89) (.95) (.98)
Distributions in excess of net
investment income -0- (.01) -0- -0- (.01)
Tax return of capital (.02) (.04) (.03) (.03) (.04)
Total dividends and
distributions (.72) (.90) (.92) (.98) (1.03)
Net asset value, end of
period $12.02 $10.70 $12.30 $11.91 $12.49
TOTAL RETURN
Total investment return based
on net asset value(c) 19.85% (6.23)% 11.33% 3.30% (4.77)%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(000's omitted) $168,123 $179,418 $185,022 $176,814 $204,271
Ratio to average net assets of:
Expenses 1.87% 1.82% 2.03% 1.83% 1.81%
Expenses, excluding
interest expense 1.84% 1.79% 1.81% 1.82% 1.81%
Net investment income 6.28% 7.07% 7.22% 7.75% 7.37%
Portfolio turnover rate 171% 276% 340% 302% 281%
See footnote summary on page 31.
_______________________________________________________________________________
30 o ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO
Selected Data For A Share Of Capital Stock Outstanding Throughout The Period
Advisor Class
--------------
August 8,
2002(d) to
June 30,
2003
--------------
Net asset value, beginning of period $10.21
INCOME FROM INVESTMENT OPERATIONS
Net investment income(b) .69
Net realized and unrealized gain on investment transactions 1.85
Net increase in net asset value from operations 2.54
LESS: DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income (.70)
Tax Return of Capital (.02)
Total dividends and distributions (.72)
Net asset value, end of period $12.03
TOTAL RETURN
Total investment return based on net asset value(c) 25.70%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted) $2,298
Ratio to average net assets of:
Expenses .88%(e)
Expenses, excluding interest expense .85%(e)
Net investment income 6.90%(e)
Portfolio turnover rate 171%
(a) As required, effective July 1, 2001, the Portfolio has adopted the
provisions of the AICPA Audit and Accounting Guide, Audits of Investment
Companies, and began amortizing premium on debt securities for financial
statement reporting purposes only. The effect of this change for the year ended
June 30, 2002, was to decrease net investment income per share and net realized
and unrealized loss on investments per share by less than $.01 for Class A,
Class B and Class C, respectively, and decrease the ratio of net investment
income to average net assets from 7.82% to 7.79% for Class A, from 7.08% to
7.05% for Class B and from 7.10% to 7.07% for Class C. Per share, ratios and
supplemental data for periods prior to July 1, 2001 have not been restated to
reflect this change in presentation.
(b) Based on average shares outstanding.
(c) Total investment return is calculated assuming an initial investment is
made at the net asset value at the beginning of the period, reinvestment of all
dividends and distributions at net asset value during the period, and
redemption on the last day of the period. Initial sales charges or contingent
deferred sales charges are not reflected in the calculation of total investment
return. Total investment return does not reflect the deduction of taxes that a
shareholder would pay on Portfolio distributions or the redemption of Portfolio
shares. Total investment return calculated for a period of less than one year
is not annualized.
(d) Commencement of distribution.
(e) Annualized.
_______________________________________________________________________________
ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO o 31
REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
To the Shareholders and Board of Directors of AllianceBernstein
Bond Fund, Inc. Corporate Bond Portfolio
We have audited the accompanying statement of assets and liabilities, including
the portfolio of investments, of the Corporate Bond Portfolio (the "Portfolio")
(one of the portfolios constituting the AllianceBernstein Bond Fund, Inc.,
formerly, the Alliance Bond Fund, Inc.) as of June 30, 2003, 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 the
financial highlights for each of the periods indicated therein. These financial
statements and financial highlights are the responsibility of the Portfolio'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 auditing standards generally
accepted in the United States. 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 and financial highlights. Our procedures included
confirmation of securities owned as of June 30, 2003, by correspondence with
the custodian and others. 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 the
Corporate Bond Portfolio of the AllianceBernstein Bond Fund, Inc. at June 30,
2003, 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 periods, in conformity with
accounting principles generally accepted in the United States.
/s/ ERNST & YOUNG LLP
New York, New York
August 8, 2003
TAX INFORMATION (unaudited)
For the fiscal year ended June 30, 2003 certain dividends paid by the Portfolio
may be subject to a maximum tax rate of 15%, as provided for by the Jobs and
Growth Tax Relief Reconciliation Act of 2003. The Portfolio designates a
maximum amount of $1,611,318 as qualified dividend income, which is taxed at a
maximum rate of 15%. The information and distributions reported herein may
differ from the information and distributions taxable to the shareholders for
the calendar year ending December 31, 2003. Complete information will be
computed and reported in conjunction with your 2003 Form 1099-DIV.
_______________________________________________________________________________
32 o ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO
BOARD OF DIRECTORS
John D. Carifa, Chairman and President
Ruth Block(1)
David H. Dievler(1)
John H. Dobkin(1)
William H. Foulk, Jr.(1)
Clifford L. Michel(1)
Donald J. Robinson(1)
OFFICERS
Kathleen A. Corbet, Senior Vice President
Lawrence J. Shaw, Vice President
Michael A. Snyder, Vice President
Paul J. DeNoon, Vice President
Matthew D.W. Bloom, Vice President
S. Sean Kelleher, Vice President
Jeffrey S. Phlegar, Vice President
Edmund P. Bergan, Jr., Secretary
Mark D. Gersten, Treasurer & Chief Financial Officer
Vincent S. Noto, Controller
Custodian
State Street Bank & Trust Company
225 Franklin Street
Boston, MA 02110
Principal Underwriter
AllianceBernstein Investment Research and Management, Inc.
1345 Avenue of the Americas
New York, NY 10105
Transfer Agent
Alliance Global Investor Services, Inc.
P.O. Box 786003
San Antonio, TX 78278-6003
Toll-Free (800) 221-5672
Independent Auditors
Ernst & Young LLP
5 Times Square
New York, NY 10036
Legal Counsel
Seward & Kissel LLP
One Battery Park Plaza
New York, NY 10004
(1) Member of the Audit Committee.
_______________________________________________________________________________
ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO o 33
MANAGEMENT OF THE FUND
Board of Directors Information
The business and affairs of the Fund are managed under the direction of the
Board of Directors. Certain information concerning the Fund's Directors is set
forth below.
PORTFOLIOS
IN FUND OTHER
NAME, AGE OF DIRECTOR, PRINCIPAL COMPLEX DIRECTORSHIPS
ADDRESS OCCUPATION(S) OVERSEEN BY HELD BY
(YEARS OF SERVICE*) DURING PAST 5 YEARS DIRECTOR DIRECTOR
- --------------------------------------------------------------------------------------------------------------------
INTERESTED DIRECTOR
John D. Carifa,** 58 President, Chief Operating Officer 113 None
1345 Avenue of the and a Director of Alliance Capital
Americas Management Corporation
New York, NY 10105 (15) ("ACMC"), with which he has
been associated since prior to
1998.
DISINTERESTED DIRECTORS
Ruth Block,#+, 72 Formerly Executive Vice President 94 None
P.O. Box 4623, and Chief Insurance Officer of The
Stamford, CT 06903 (15) Equitable Life Assurance Society
of the United States; Chairman
and Chief Executive Officer of
Evlico; Director of Avon, BP (oil
and gas), Ecolab Incorporated
(specialty chemicals), Tandem
Financial Group, and Donaldson
Lufkin & Jenrette Securities
Corporation; former Governor at
Large-National Association of
Securities Dealers, Inc.
David H. Dievler,#+, 73 Independent consultant. Until 98 None
P.O. Box 167, December 1994, he was Senior
Spring Lake, NJ 07762 Vice President of ACMC
(15) responsible for mutual fund
administration. Prior to joining
ACMC in 1984, he was Chief
Financial Officer of Eberstadt
Asset Management since 1968.
Prior to that, he was Senior
Manager at Price Waterhouse &
Co. Member of American Institute
of Certified Public Accountants
since 1953.
John H. Dobkin,#+, 61 Consultant. He was formerly 95 None
P.O. Box 12, President of Save Venice, Inc.
Annandale, NY 12504 (5) from 2001-2002, Senior Advisor
from June 1999-June 2000 and
President (December 1989-May
1999) of Historic Hudson Valley
(historic preservation). Previously,
Director of the National Academy
of Design. During 1988-92, he
was Director and Chairman of the
Audit Committee of ACMC.
_______________________________________________________________________________
34 o ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO
PORTFOLIOS
IN FUND OTHER
NAME, AGE OF DIRECTOR, PRINCIPAL COMPLEX DIRECTORSHIPS
ADDRESS OCCUPATION(S) OVERSEEN BY HELD BY
(YEARS OF SERVICE*) DURING PAST 5 YEARS DIRECTOR DIRECTOR
- --------------------------------------------------------------------------------------------------------------------
DISINTERESTED DIRECTORS
(continued)
William H. Foulk, Jr.,#+, 70 Investment Adviser and an 110 None
2 Sound View Drive independent consultant. He was
Suite 100 formerly Senior Manager of
Greenwich, CT 06830 (5) Barrett Associates, Inc., a
registered investment adviser,
with which he had been
associated since prior to 1998.
He was formerly Deputy
Comptroller of the State of New
York and, prior thereto, Chief
Investment Officer of the New
York Bank for Savings.
Clifford L. Michel,#+, 64 Senior Counsel of the law firm of 94 Placer Dome,
St. Bernard's Road Cahill Gordon & Reindel since Inc.
Gladstone, NJ 07934 (15) February 2001 and a partner of
that firm for more than 25 years
prior thereto. He is President and
Chief Executive Officer of
Wenonah Development Company
(investments) and a Director of
the Placer Dome Inc. (mining).
Donald J. Robinson,#+, 69 Senior Counsel to the law firm of 93 None
98 Hell's Peak Road Orrick, Herrington & Sutcliffe LLP
Weston, VT 05161 (6) since prior to 1998. Formerly a
senior partner and a member of
the Executive Committee of that
firm. He was also a member and
Chairman of the Municipal
Securities Rulemaking Board
and a Trustee of the Museum of
the City of New York.
* There is no stated term of office for the Fund's directors.
** Mr. Carifa is an "interested director", as defined in the 1940 Act, due to
his position as President and Chief Operating Officer of ACMC, the Fund's
investment adviser.
# Member of the Audit Committee.
+ Member of the Nominating Committee.
_______________________________________________________________________________
ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO o 35
Officer Information
Certain information concerning the Fund's Officers is set forth below.
NAME, POSITION(S) PRINCIPAL OCCUPATION
ADDRESS* AND AGE HELD WITH FUND DURING PAST 5 YEARS**
- --------------------------------------------------------------------------------------------------------------
Kathleen A. Corbet, 43 Senior Vice President Executive Vice President of Alliance Capital
Management Corporation (ACMC)**, with which
she has been associated since prior to 1998.
Matthew D.W. Bloom, 47 Vice President Senior Vice President ACMC**, with which he
has been associated since prior to 1998.
Jeffrey S. Phlegar, 36 Vice President Vice President of ACMC**, with which he has
been associated since prior to 1998.
Sean Kelleher, 42 Vice President Senior Vice President of ACMC** since 1999.
Previously, a manager of the MBS swaps desk
at Deutsche Bank since 1997 and worked in
fixed income research at Merrill Lynch since
prior to 1998.
Paul J. DeNoon, 41 Vice President Senior Vice President of ACMC**, with which
he has been associated since prior to 1998.
Lawrence J. Shaw, 52 Vice President Senior Vice President of ACMC**, with which
he has been associated since prior to 1998.
Michael A. Snyder, 41 Vice President Senior Vice President of ACMC** since May, 2001.
Previously he was a Managing Director in the
high yield asset management group at Donaldson,
Lufkin & Jenrette Corporation from 1998 to 2001,
and a Managing Director at Bear Stearns & Co.
from 1997 to 1998. Prior thereto, he was a
Senior Vice President at Prudential Capital
since prior to 1998.
Edmund P. Bergan, Jr., 53 Secretary Senior Vice President and General Counsel of
AllianceBernstein Investment Research and
Management, Inc. ("ABIRM")** and Alliance
Global Investor Services, Inc. ("AGIS")**,
with which he has been associated since
prior to 1998.
_______________________________________________________________________________
36 o ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO
NAME, POSITION(S) PRINCIPAL OCCUPATION
ADDRESS* AND AGE HELD WITH FUND DURING PAST 5 YEARS**
- --------------------------------------------------------------------------------------------------------------
Officers
(continued)
Mark D. Gersten, 52 Treasurer and Chief Senior Vice President of AGIS**, with which
Financial Officer he has been associated since prior to 1998.
Vincent S. Noto, 38 Controller Vice President of AGIS**, with which he has
been associated since prior to 1998.
* The address for each of the Fund's Officers is 1345 Avenue of the Americas,
New York, NY 10105.
** ACMC, ABIRM and AGIS are affiliates of the Fund.
The Fund's Statement of Additional Information ("SAI") has additional
information about the Fund's Directors and Officers and is available without
charge upon request. Contact your financial representative or Alliance Capital
at 1-800-227-4618 for a free prospectus or SAI.
_______________________________________________________________________________
ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO o 37
ALLIANCEBERNSTEIN FAMILY OF FUNDS
U.S. Growth Funds
Growth Fund
Health Care Fund
Mid-Cap Growth Fund
Premier Growth Fund
Quasar Fund
Technology Fund
Value Funds
Balanced Shares
Disciplined Value Fund
Global Value Fund
Growth & Income Fund
International Value Fund
Real Estate Investment Fund
Small CapValue Fund
Utility Income Fund
Value Fund
Blended Style Series
U.S. Large Cap Portfolio
Global & International Stock Funds
All-Asia Investment Fund
Global Small Cap Fund
Greater China '97 Fund
International Premier Growth Fund
New Europe Fund
Worldwide Privatization Fund
Select Investor Series
Biotechnology Portfolio
Premier Portfolio
Technology Portfolio
Taxable Bond Funds
Americas Government Income Trust
Corporate Bond Portfolio
Emerging Market Debt Fund
Global Strategic Income Trust
High Yield Fund
Multi-Market Strategy Trust
Quality Bond Portfolio
U.S. Government Portfolio
Tax-Exempt Bond Funds
National
Intermediate Diversified
Insured National
Arizona
California
Intermediate California
Insured California
Florida
Massachusetts
Michigan
Minnesota
New Jersey
New York
Intermediate New York
Ohio
Pennsylvania
Virginia
Asset Allocation Funds
Conservative Investors Fund
Growth Investors Fund
Closed-End Funds
All-Market Advantage Fund
ACM Income Fund
ACM Government Opportunity Fund
ACM Managed Dollar Income Fund
ACM Managed Income Fund
ACM Municipal Securities Income Fund
California Municipal Income Fund
National Municipal Income Fund
New York Municipal Income Fund
The Spain Fund
World Dollar Government Fund
World Dollar Government Fund II
AllianceBernstein also offers AllianceBernstein Exchange Reserves, which serves
as the money market fund exchange vehicle for the AllianceBernstein mutual
funds.
To obtain a prospectus for any AllianceBernstein fund, call your investment
professional, or call AllianceBernstein at (800) 227-4618 or visit our web site
at www.alliancebernstein.com.
_______________________________________________________________________________
38 o ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO
NOTES
_______________________________________________________________________________
ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO o 39
NOTES
_______________________________________________________________________________
40 o ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO
ALLIANCEBERNSTEIN BOND FUND CORPORATE BOND PORTFOLIO
1345 Avenue of the Americas
New York, NY 10105
(800) 221-5672
AllianceBernstein [LOGO](SM)
Investment Research and Management
SM This service mark used under license from the owner, Alliance Capital
Management L.P.
CBPAR0603
ITEM 2. CODE OF ETHICS.
Form N-CSR disclosure requirement not yet effective with respect to the
registrant.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Form N-CSR disclosure requirement not yet effective with respect to the
registrant.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Form N-CSR disclosure requirement not yet effective with respect to the
registrant.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable to the registrant.
ITEM 6. [RESERVED]
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable to the registrant.
ITEM 8. [RESERVED]
ITEM 9. CONTROLS AND PROCEDURES.
(a) The registrant's principal executive officer and principal financial officer
have concluded that the registrant's disclosure controls and procedures (as
defined in Rule 30a-2(c) under the Investment Company Act of 1940, as amended)
are effective at the reasonable assurance level based on their evaluation of
these controls and procedures as of a date within 90 days of the filing date of
this document.
(b) There were no significant changes in the registrant's internal controls that
could significantly affect these controls subsequent to the date of their
evaluation, including any corrective actions with regard to significant
deficiencies and material weaknesses.
ITEM 10. EXHIBITS.
The following exhibits are attached to this Form N-CSR:
Exhibit No. DESCRIPTION OF EXHIBIT
10 (b) (1) Certification of Principal Executive Officer Pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002
10 (b) (2) Certification of Principal Financial Officer Pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002
10 (c) Certification of Principal Executive Officer and Principal
Financial Officer Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant): AllianceBernstein Bond Fund, Inc.
By: /s/John D. Carifa
---------------------------------
John D. Carifa
President
Date: August 22, 2003
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By: /s/John D. Carifa
---------------------------------
John D. Carifa
President
Date: August 22, 2003
By: /s/Mark D. Gersten
-------------------------------
Mark D. Gersten
Treasurer and Chief Financial Officer
Date: August 22, 2003