Net sales of tax-exempt mutual funds in the first four months of 1993 were more than 70% ahead of the year-earlier pace, according to the Investment Company Institute.

The $17.08 billion figure for January through April was 70.7% ahead of the early-1992 figure, the institute said.

At the end of April, the most recent month for which figures are available, the assets of national funds totaled $122.6 billion, up 32.1% from the year-earlier level.

Assets of single-state funds totaled $96.6 billion, up 37.5% from April 1992.

A Month-to-Month Decline

Net sales of long-term municipal funds totaled $3.75 billion in April, 16.9% below the March level, the institute said. Analysts attributed the month-to-month decline to factors including investors' decreased expectations of state-level tax increases and their traditional April sell-off to meet personal income tax needs.

Nationwide fund sales for the month dipped 14% from March, to $1.94 billion. Single-state fund net sales fell 19.7%, to $1.81 billion.

Net sales comprise sales and reinvested dividends, minus redemptions.

The drop in single-state fund assets in April was the first monthly decline this year.

Individual investors typically redeem shares in single-state funds during April to raise cash for personal income tax payments, said Richard Ciccarone, director of tax-exempt fixed-income research at Kemper Securities Inc. in Chicago.

|Robust Demand'

Despite declines in April from the previous month in both national and single-state fund net sales, both fund sectors posted gains when compared with April 1992.

Overall fund sales increased 61.2% from a year earlier. National fund sales rose 63.8% and sing-state fund sales were up 58.6% from April 1992.

"The numbers continue to show robust demand by individuals for municipal bonds," Kemper's Mr. Ciccarone said.

Total long-term municipal net sales of approximately $3.8 billion in April equals nearly 20% of the $20.7 billion of long-term debt sold during the month, Mr. Ciccarone said.

The Investment Company Institute considers long-term funds to be all those with maturities of more than one year.

Focus on Federal Taxes

In previous years, weakened economies and state government budget shortfalls have caused many states to propose or implement tax increases, which led to an explosion in the demand for single-state muni funds, the Kemper analyst said.

At present, however, "state tax changes have not been as important as they were in 1992 and previous years," Mr. Ciccarone said.

Instead, there has been more focus on federal tax increases. In addition, bond market volatility during April caused many money managers to direct investors toward shorter-term investments.

The Bond Buyer is a sister publication of American Banker.

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