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CALIFORNIA MUNICIPAL BONDS CAN BE A GOOD INVESTMENT FOR INVESTORS SEEKING TAX FREE INCOME

 SAN FRANCISCO, Calif., July 13 /PRNewswire/ -- California bonds can be a good investment for residents seeking tax-exempt income despite the state's overall economic weakness, according to Kim Michalski, portfolio manager for the Pacific Horizon California Tax-Exempt Bond Fund. It had $217 million in total assets as of June 21, 1983.
 "The higher federal income tax rate proposed by President Clinton makes a compelling case for buying municipal securities," says Michalski. "For Californians seeking tax-free income there are still many strong local issuers since economic performance varies significantly from one region to another. Not all local governments and agencies that issue municipal bonds are having problems. Northern California has fared much better than the south, for example, and the Central Valley region is very healthy."
 Although California's economy is not expected to recover until 1994, Michalski believes the state's economic fundamentals are strong and already sees some positive trends.
 "The unemployment rate has fallen to 8.7 percent from 9.8 since February," she says. "Despite negative statistics, I believe California will emerge from its current recession as the magnitude, diversity and wealth of its economy eventually produce the long-term growth needed for a statewide recovery."
 As an example of the state's strong economic fundamentals, Michalski notes that California is the world's eighth-largest economy and the country's most populous state.
 With the credit quality of municipal bonds an important concern and the municipal market growing more complex, Michalski believes individual investors should buy these securities through a mutual fund. "In that way," she explains, "investors have a professional staff working for them that understands the municipal market and can also do all the necessary credit research."
 The California Tax-Exempt Bond Fund, managed by Bank of America NT&SA, is part of the Pacific Horizon family of funds, one of the largest bank-managed funds in the country with $22.2 billion in total assets as of June 21, 1993.
 Concord Holding Corporation is the administrator of the funds, and its subsidiary, Concord Financial Group, Inc., is the distributor. Concord is unaffiliated with Bank of America. The funds are not deposits and are not obligations of, or guaranteed by, Bank of America and are not FDIC insured.
 -0- 7/13/93
 /CONTACT: Laura Berger or Stan Appenzeller of Arlen Financial Communications, 212-966-5100, or Sharon Tucker of Bank of America, 415-622-2775/


CO: Pacific Horizon California Tax-Exempt Bond Fund ST: California IN: FIN SU: ECO

LG-MP -- NY035 -- 0872 07/13/93 11:54 EDT
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Publication:PR Newswire
Date:Jul 13, 1993
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