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 811-05739

 

Name of Fund: BlackRock MuniEnhanced Fund, Inc. (MEN)

 

Fund Address: 100 Bellevue Parkway, Wilmington, DE 19809

 

Name and address of agent for service: John M. Perlowski, Chief Executive Officer, BlackRock MuniEnhanced Fund, Inc., 55 East 52nd Street, New York, NY 10055

 

Registrant’s telephone number, including area code: (800) 882-0052, Option 4

 

Date of fiscal year end: 04/30/2012

 

Date of reporting period: 04/30/2012

 

Item 1 – Report to Stockholders

 


 

 

(BLACKROCK LOGO)

April 30, 2012


 

Annual Report

 

BlackRock MuniAssets Fund, Inc. (MUA)

BlackRock MuniEnhanced Fund, Inc. (MEN)

BlackRock MuniHoldings Fund, Inc. (MHD)

BlackRock MuniHoldings Fund II, Inc. (MUH)

BlackRock MuniHoldings Quality Fund, Inc. (MUS)

BlackRock Muni Intermediate Duration Fund, Inc. (MUI)

BlackRock MuniVest Fund II, Inc. (MVT)


 

Not FDIC Insured § No Bank Guarantee § May Lose Value




 

 

Table of Contents

 

 

 

 

 

Page

 

 

Dear Shareholder

3

Annual Report:

 

Municipal Market Overview

4

Fund Summaries

5

The Benefits and Risks of Leveraging

12

Derivative Financial Instruments

12

Financial Statements:

 

Schedules of Investments

13

Statements of Assets and Liabilities

50

Statements of Operations

51

Statements of Changes in Net Assets

52

Statements of Cash Flows

54

Financial Highlights

55

Notes to Financial Statements

62

Report of Independent Registered Public Accounting Firm

72

Important Tax Information

73

Automatic Dividend Reinvestment Plans

74

Officers and Directors

75

Additional Information

79


 

 

 

 

 

 

2

ANNUAL REPORT

APRIL 30, 2012




 

 

Dear Shareholder

One year ago at this time, risk assets were in a broad retreat as political strife in Greece ignited fears about sovereign debt problems spreading across Europe and economic indicators signaled that the global recovery had slowed. Confidence was further shaken by the prolonged debt ceiling debate in Washington, DC. Early in August 2011, Standard & Poor’s downgraded the US government’s credit rating and turmoil erupted in financial markets around the world. Extraordinary levels of volatility persisted in the months that followed as the European debt crisis intensified. Macro news flow became the dominant force in financial markets, driving asset prices up and down in lock step, in a risk on/risk off trading pattern. By the end of the third quarter in 2011, equity markets had fallen nearly 20% from their April peak while safe-haven assets such as US Treasuries and gold had rallied to historic highs.

October 2011 brought enough positive economic data to assuage fears of a global double-dip recession. Additionally, European leaders began making concerted efforts to stem the region’s debt crisis. Investors began to reenter the markets, putting risk assets on the road to recovery. Improving sentiment carried over into early 2012 as a number of factors elicited greater optimism. Sovereign debt problems in Europe became less pressing. Greece secured its second bailout package and completed the restructuring of its national debt. The European Central Bank gave financial markets a boost by providing additional liquidity through its long-term refinancing operations. The outlook for the global economy grew less dim as stronger data from the United States, particularly from the labor market, lifted sentiment. Hopes for additional monetary stimulus from the US Federal Reserve and strong corporate earnings pushed risk assets (including stocks, commodities and high yield bonds) higher through the first two months of the year while rising Treasury yields pressured higher-quality fixed income assets. The risk rally softened in late March, however, due to renewed fears about slowing growth in China and Europe’s debt troubles. Equity markets staggered downward in April as Spain’s financial situation became increasingly severe and elections in Greece and France added to uncertainty about the future of the euro zone. In the United States, disappointing jobs reports in April revealed that the recent acceleration in the labor market had been a short-lived surge. Overall, US economic data signaled that the pace of the recovery had slowed, but not to the extent that warranted additional monetary stimulus.

Thanks in large part to an exceptionally strong first quarter of 2012, equities and high yield bonds posted solid returns for the 6-month period ended April 30, 2012. On a 12-month basis, US large-cap stocks and high yield bonds delivered positive results; however, small-cap stocks finished in negative territory. International and emerging equities, which experienced significant downturns in 2011, lagged the broader rebound. Fixed income securities, including corporate, government and municipal bonds, performed well despite recent yield volatility. US Treasury bonds finished strong, with an April rally erasing the effects of their broad sell-off during February and March. Continued low short-term interest rates kept yields on money market securities near their all-time lows.

Financial markets have regained a significant degree of stability since the period of turmoil we endured last year; however, considerable headwinds remain. Political uncertainty in Europe elevates concerns about additional flare ups in the debt crisis. Higher energy prices and slowing growth in China continue to pose risks for the global economy. Potential political leadership changes around the world create additional layers of uncertainty. But, we believe that with these challenges come opportunities. We remain committed to working with you and your financial professional to identify actionable ideas for your portfolio. We encourage you to visit www.blackrock.com/newworld for more information.

 

Sincerely,

-s- Rob Kapito

Rob Kapito

President, BlackRock Advisors, LLC

(PHOTO OF ROB KAPITO)

“Financial markets have regained a significant degree of stability since the period of turmoil we endured last year; however, considerable headwinds remain.”

 

Rob Kapito

President, BlackRock Advisors, LLC

 

Total Returns as of April 30, 2012

 

 

 

 

 

 

 

 

 

 

6-month

 

12-month

 

US large cap equities
(S&P 500® Index)

 

 

12.77

%

 

4.76

%

US small cap equities
(Russell 2000® Index)

 

 

11.02

 

 

(4.25

)

International equities
(MSCI Europe, Australasia,
Far East Index)

 

 

2.44

 

 

(12.82

)

Emerging market
equities (MSCI Emerging
Markets Index)

 

 

3.93

 

 

(12.61

)

3-month Treasury bill
(BofA Merrill Lynch
3-Month Treasury
Bill Index)

 

 

0.01

 

 

0.05

 

US Treasury securities
(BofA Merrill Lynch 10-
Year US Treasury Index)

 

 

3.83

 

 

16.41

 

US investment grade
bonds (Barclays US
Aggregate Bond Index)

 

 

2.44

 

 

7.54

 

Tax-exempt municipal
bonds (S&P Municipal
Bond Index)

 

 

5.71

 

 

11.90

 

US high yield bonds
(Barclays US Corporate
High Yield 2% Issuer
Capped Index)

 

 

6.91

 

 

5.89

 

 

 

 

 

 

 

 

 

Past performance is no guarantee of future results. Index performance is shown for illustrative purposes only. You cannot invest directly in an index.


 

 

 

 

 

 

 

THIS PAGE NOT PART OF YOUR FUND REPORT

3




 

 

Municipal Market Overview


 

For the 12-Month Period Ended April 30, 2012

One year ago, the municipal bond market was steadily recovering from a difficult fourth quarter of 2010 that brought severe losses amid a steepening US Treasury yield curve and a flood of inflated headlines about municipal finance troubles. Retail investors had lost confidence in municipals and retreated from the market. Political uncertainty surrounding the midterm elections and tax policies exacerbated the situation. These conditions combined with seasonal illiquidity weakened willful market participation from the trading community. December 2010 brought declining demand with no comparable reduction in supply as issuers rushed their deals to market before the Build America Bond program was retired. This supply-demand imbalance led to wider quality spreads and higher yields for municipal bonds heading into 2011.

(LINE GRAPH)

Demand is usually strong at the beginning of a new year, but retail investors continued to move away from municipal mutual funds in the first half of 2011. From the middle of November 2010, outflows persisted for 29 consecutive weeks, totaling $35.1 billion before the trend finally broke in June 2011. However, weak demand was counterbalanced by lower supply in 2011. According to Thomson Reuters, new issuance was down 32% in 2011 as compared to the prior year. While these technical factors were improving, municipalities were struggling to balance their budgets, although the late-2010 predictions for widespread municipal defaults did not materialize. Other concerns that resonated at the beginning of the year, such as rising interest rates, weakening credits and higher rates of inflation, abated as these scenarios also did not come to fruition.

On August 5, 2011, Standard & Poor’s (“S&P”) downgraded the US government’s credit rating from AAA to AA+. While this led to the downgrade of approximately 11,000 municipal issues directly tied to the US debt rating, this represented a very small fraction of the municipal market and said nothing about the individual municipal credits themselves. In fact, demand for municipal bonds increased as severe volatility in US equities drove investors to more stable asset classes. The municipal market benefited from an exuberant Treasury market and continued muted new issuance. As supply remained constrained, demand from both traditional and non-traditional buyers was strong, pushing long-term municipal bond yields lower and sparking a curve-flattening trend that continued through year end. Ultimately, 2011 was one of the strongest performance years in municipal market history. The S&P Municipal Bond Index returned 10.62% in 2011, making municipal bonds a top-performing fixed income asset class for the year.

Municipal market supply-and-demand technicals typically strengthen considerably upon the conclusion of tax season as net negative supply takes hold. This theme remained intact for 2012. Overall, the municipal yield curve flattened during the period from April 30, 2011 to April 30, 2012. As measured by Thomson Municipal Market Data, yields declined by 133 basis points (“bps”) to 3.25% on AAA-rated 30-year municipal bonds and by 98 bps to 1.87% on 10-year bonds, while yields on 5-year issues fell 68 bps to 0.82%. While the entire municipal curve flattened over the 12-month time period, the spread between 2- and 30-year maturities tightened by 108 bps, and in the 2- to 10-year range, the spread tightened by 73 bps.

The fundamental picture for municipalities continues to improve. Austerity has been the general theme across the country, while a small number of states continue to rely on a “kick-the-can” approach to close their budget shortfalls, with aggressive revenue projections and accounting gimmicks. It has been well over a year since the fiscal problems plaguing state and local governments first became highly publicized. Thus far, the prophecy of widespread defaults across the municipal market has not materialized. Year-to-date through the end of April, less than $470 million in par value of municipal bonds have defaulted for the first time. This represents only 0.0125% in total municipal bonds outstanding, as compared to 0.065% for the full year 2011. (Data provided by Bank of America.) BlackRock maintains the view that municipal bond defaults will remain in the periphery and the overall market is fundamentally sound. We continue to recognize that careful credit research and security selection remain imperative amid uncertainty in this economic environment.

          Past performance is no guarantee of future results. Index performance is shown for illustrative purposes only. You cannot invest directly in an index.

 

 

 

 

 

 

4

ANNUAL REPORT

APRIL 30, 2012




 

 

 

 

Fund Summary as of April 30, 2012

BlackRock MuniAssets Fund, Inc.

 

Fund Overview

BlackRock MuniAssets Fund, Inc.’s (MUA) (the “Fund”) investment objective is to provide high current income exempt from federal income taxes by investing primarily in a portfolio of medium- to lower-grade or unrated municipal obligations, the interest on which, in the opinion of bond counsel to the issuer, is exempt from federal income taxes. The Fund seeks to achieve its investment objective by investing, under normal market conditions, at least 80% of its assets in municipal bonds exempt from federal income taxes (except that the interest may be subject to the federal alternative minimum tax). The Fund invests at least 65% of its assets in municipal bonds that are rated in the medium to lower categories by nationally recognized rating services (for example, Baa or lower by Moody’s Investors Service, Inc. or BBB or lower by Standard & Poor’s Corporation) or non-rated securities which are of comparable quality. The Fund may invest directly in such securities or synthetically through the use of derivatives.

 

 

 

No assurance can be given that the Fund’s investment objective will be achieved.


 

Performance

For the 12 months ended April 30, 2012, the Fund returned 23.99% based on market price and 17.90% based on net asset value (“NAV”). For the same period, the closed-end Lipper High Yield Municipal Debt Funds category posted an average return of 25.16% based on market price and 21.21% based on NAV. All returns reflect reinvestment of dividends. The Fund’s discount to NAV, which narrowed during the period, accounts for the difference between performance based on price and performance based on NAV. The following discussion relates to performance based on NAV. The primary factors contributing to positive performance during the period were the Fund’s sector concentrations in transportation, utilities and health as well as a yield curve-flattening bias. The Fund has consistently emphasized longer-dated securities in order to benefit from long-term rates declining faster than short-term rates, a scenario that occurred during the period. Detracting from performance was security selection within various sectors. The distribution yield generated by the Fund’s holdings fell below the average of its Lipper category peers, causing a drag on the Fund’s total return for the period.

 

 

 

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.


 

Fund Information


 

 

 

 

 

Symbol on New York Stock Exchange (“NYSE”)

 

 

MUA

 

Initial Offering Date

 

 

June 25, 1993

 

Yield on Closing Market Price as of April 30, 2012 ($13.15)1

 

 

5.70%

 

Tax Equivalent Yield2

 

 

8.77%

 

Current Monthly Distribution per Common Share3

 

 

$0.0625

 

Current Annualized Distribution per Common Share3

 

 

$0.7500

 

Economic Leverage as of April 30, 20124

 

 

11%

 


 

 

 

 

1

Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.

 

 

 

 

2

Tax equivalent yield assumes the maximum federal tax rate of 35%.

 

 

 

 

3

The distribution rate is not constant and is subject to change.

 

 

 

 

4

Represents tender option bond trusts (“TOBs”) as a percentage of total managed assets, which is the total assets of the Fund, including any assets attributable to TOBs, minus the sum of accrued liabilities. For a discussion of leveraging techniques used by the Fund, please see The Benefits and Risks of Leveraging on page 12.

The table below summarizes the changes in the Fund’s market price and NAV per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4/30/12

 

4/30/11

 

Change

 

High

 

Low

 

Market Price

 

$

13.15

 

$

11.27

 

 

16.68

%

$

13.34

 

$

10.97

 

Net Asset Value

 

$

13.47

 

$

12.14

 

 

10.96

%

$

13.47

 

$

12.14

 

The following charts show the sector and credit quality allocations of the Fund’s long-term investments:

 

 

 

 

 

 

 

 

Sector Allocations

 

 

 

 

 

 

 

 

 

4/30/12

 

4/30/11

 

Health

 

27

%

 

27

%

 

Transportation

 

21

 

 

15

 

 

Corporate

 

16

 

 

22

 

 

County/City/Special District/School District

 

13

 

 

14

 

 

Utilities

 

10

 

 

8

 

 

Education

 

6

 

 

6

 

 

Tobacco

 

4

 

 

1

 

 

State

 

3

 

 

3

 

 

Housing

 

 

 

4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Credit Quality Allocations5

 

 

 

 

 

 

 

 

 

4/30/12

 

4/30/11

 

AAA/Aaa

 

1

%

 

3

%

 

AA/Aa

 

18

 

 

8

 

 

A

 

11

 

 

12

 

 

BBB/Baa

 

27

 

 

28

 

 

BB/Ba

 

6

 

 

7

 

 

B

 

7

 

 

5

 

 

CCC/Caa

 

2

 

 

5

 

 

CC/Ca

 

1

 

 

1

 

 

Not Rated6

 

27

 

 

31

 

 


 

 

 

 

5

Using the higher of S&P’s or Moody’s Investors Service (“Moody’s”) ratings.

 

6

The investment advisor has deemed certain of these securities to be of investment grade quality. As of April 30, 2012 and April 30, 2011, the market value of these securities was $25,540,846, representing 5%, and $25,268,218, representing 6%, respectively, of the Fund’s long-term investments.


 

 

 

 

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

5




 

 

 

 

Fund Summary as of April 30, 2012

BlackRock MuniEnhanced Fund, Inc.

 

Fund Overview

BlackRock MuniEnhanced Fund, Inc.’s (MEN) (the “Fund”) investment objective is to provide shareholders with as high a level of current income exempt from federal income taxes as is consistent with its investment policies and prudent investment management. The Fund seeks to achieve its investment objective by investing at least 80% of its assets in municipal bonds exempt from federal income taxes (except that the interest may be subject to the federal alternative minimum tax). Under normal market conditions, the Fund invests primarily in long-term municipal bonds rated investment grade quality at the time of investment and invests primarily in long-term municipal bonds with maturities of more than ten years at the time of investment. The Fund may invest directly in such securities or synthetically through the use of derivatives.

 

 

 

No assurance can be given that the Fund’s investment objective will be achieved.


 

Performance

For the 12 months ended April 30, 2012, the Fund returned 24.11% based on market price and 25.12% based on NAV. For the same period, the closed-end Lipper General & Insured Municipal Debt Funds (Leveraged) category posted an average return of 25.51% based on market price and 23.04% based on NAV. All returns reflect reinvestment of dividends. The Fund’s discount to NAV, which widened during the period, accounts for the difference between performance based on price and performance based on NAV. The following discussion relates to performance based on NAV. The largest drivers of Fund performance during the period were the decline in interest rates (bond prices rise when interest rates fall), the flattening of the yield curve (long-term interest rates fell more than short and intermediate rates) and tightening of credit spreads. The Fund’s exposure to zero-coupon bonds and the health sector contributed positively to performance as these bonds derived the greatest benefit from the declining interest rates and spread tightening during the period.

 

 

 

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.


 

Fund Information


 

 

 

 

 

Symbol on NYSE

 

 

MEN

 

Initial Offering Date

 

 

March 2, 1989

 

Yield on Closing Market Price as of April 30, 2012 ($11.66)1

 

 

5.97%

 

Tax Equivalent Yield2

 

 

9.18%

 

Current Monthly Distribution per Common Share3

 

 

$0.0580

 

Current Annualized Distribution per Common Share3

 

 

$0.6960

 

Economic Leverage as of April 30, 20124

 

 

37%

 


 

 

 

 

1

Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.

 

 

 

 

2

Tax equivalent yield assumes the maximum federal tax rate of 35%.

 

 

 

 

3

The distribution rate is not constant and is subject to change.

 

 

 

 

4

Represents Variable Rate Demand Preferred Shares (“VRDP Shares”) and TOBs as a percentage of total managed assets, which is the total assets of the Fund, including any assets attributable to VRDP Shares and TOBs, minus the sum of accrued liabilities. For a discussion of leveraging techniques used by the Fund, please see The Benefits and Risks of Leveraging on page 12.

The table below summarizes the changes in the Fund’s market price and NAV per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4/30/12

 

4/30/11

 

Change

 

High

 

Low

 

Market Price

 

$

11.66

 

$

9.99

 

 

16.72

%

$

12.20

 

$

9.65

 

Net Asset Value

 

$

12.12

 

$

10.30

 

 

17.67

%

$

12.17

 

$

10.30

 

The following charts show the sector and credit quality allocations of the Fund’s long-term investments:

 

 

 

 

 

 

 

 

Sector Allocations

 

 

 

 

 

 

 

 

 

4/30/12

 

4/30/11

 

County/City/Special District/School District

 

25

%

 

29

%

 

Transportation

 

24

 

 

23

 

 

State

 

19

 

 

19

 

 

Utilities

 

13

 

 

14

 

 

Health

 

7

 

 

6

 

 

Education

 

7

 

 

5

 

 

Corporate

 

3

 

 

2

 

 

Housing

 

2

 

 

2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Credit Quality Allocations5

 

 

 

 

 

 

 

 

 

4/30/12

 

4/30/11

 

AAA/Aaa

 

15

%

 

12

%

 

AA/Aa

 

58

 

 

59

 

 

A

 

20

 

 

25

 

 

BBB/Baa

 

6

 

 

4

 

 

B

 

1

 

 

 

 


 

 

 

 

5

Using the higher of S&P’s or Moody’s ratings.


 

 

 

 

 

 

6

ANNUAL REPORT

APRIL 30, 2012




 

 

 

 

Fund Summary as of April 30, 2012

BlackRock MuniHoldings Fund, Inc.


 

Fund Overview

BlackRock MuniHoldings Fund, Inc.’s (MHD) (the “Fund”) investment objective is to provide shareholders with current income exempt from federal income taxes. The Fund seeks to achieve its investment objective by investing at least 80% of its assets in municipal bonds exempt from federal income taxes (except that the interest may be subject to the federal alternative minimum tax). The Fund invests, under normal market conditions, at least 75% of its assets in municipal bonds rated investment grade and invests primarily in long-term municipal bonds with a maturity of more than ten years at the time of investment. The Fund may invest directly in such securities or synthetically through the use of derivatives.

          No assurance can be given that the Fund’s investment objective will be achieved.

 

Performance

For the 12 months ended April 30, 2012, the Fund returned 33.28% based on market price and 26.57% based on NAV. For the same period, the closed-end Lipper General & Insured Municipal Debt Funds (Leveraged) category posted an average return of 25.51% based on market price and 23.04% based on NAV. All returns reflect reinvestment of dividends. The Fund moved from a discount to NAV to a premium by period end, which accounts for the difference between performance based on price and performance based on NAV. The following discussion relates to performance based on NAV. The primary factors contributing to positive performance during the period were the Fund’s duration positioning (preference for securities with a higher sensitivity to interest rate movements) and yield curve-flattening bias. The Fund has consistently emphasized longer-dated securities in order to benefit from long-term rates declining faster than short-term rates, a scenario that occurred during the period. In addition, sector concentrations in health and transportation proved beneficial, as did the avoidance of pre-refunded and escrowed issues, which underperformed the broader market. The Fund’s holdings generated a high distribution yield, which in the aggregate, had a meaningful impact on returns. Detracting from performance was the Fund’s long-standing focus on corporate-related debt, which modestly underperformed the market during the period.

 

 

 

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.


 

Fund Information


 

 

 

 

 

Symbol on NYSE

 

MHD

 

Initial Offering Date

 

May 2, 1997

 

Yield on Closing Market Price as of April 30, 2012 ($18.08)1

 

 

6.07%

 

Tax Equivalent Yield2

 

 

9.34%

 

Current Monthly Distribution per Common Share3

 

 

$0.0915

 

Current Annualized Distribution per Common Share3

 

 

$1.0980

 

Economic Leverage as of April 30, 20124

 

 

37%

 


 

 

 

 

1

Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.

 

 

 

 

2

Tax equivalent yield assumes the maximum federal tax rate of 35%.

 

 

 

 

3

The distribution rate is not constant and is subject to change.

 

 

 

 

4

Represents Variable Rate Muni Term Preferred Shares (“VMTP Shares”) and TOBs as a percentage of total managed assets, which is the total assets of the Fund, including any assets attributable to VMTP Shares and TOBs, minus the sum of accrued liabilities. For a discussion of leveraging techniques used by the Fund, please see The Benefits and Risks of Leveraging on page 12.

The table below summarizes the changes in the Fund’s market price and NAV per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4/30/12

 

4/30/11

 

Change

 

High

 

Low

 

Market Price

 

$

18.08

 

$

14.51

 

 

24.60

%

$

18.45

 

$

14.25

 

Net Asset Value

 

$

17.36

 

$

14.67

 

 

18.34

%

$

17.36

 

$

14.67

 

The following charts show the sector and credit quality allocations of the Fund’s long-term investments:

 

Sector Allocations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4/30/12

 

 

4/30/11

 

Health

 

 

 

21

%

 

 

 

23

%

 

Transportation

 

 

 

18

 

 

 

 

16

 

 

State

 

 

 

13

 

 

 

 

12

 

 

Utilities

 

 

 

13

 

 

 

 

11

 

 

County/City/Special District/School District

 

 

 

12

 

 

 

 

10

 

 

Education

 

 

 

10

 

 

 

 

9

 

 

Corporate

 

 

 

8

 

 

 

 

12

 

 

Tobacco

 

 

 

3

 

 

 

 

1

 

 

Housing

 

 

 

2

 

 

 

 

6

 

 


 

Credit Quality Allocations5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4/30/12

 

 

4/30/11

 

AAA/Aaa

 

 

 

8

%

 

 

 

12

%

 

AA/Aa

 

 

 

37

 

 

 

 

40

 

 

A

 

 

 

23

 

 

 

 

22

 

 

BBB/Baa

 

 

 

15

 

 

 

 

13

 

 

BB/Ba

 

 

 

1

 

 

 

 

2

 

 

B

 

 

 

5

 

 

 

 

2

 

 

CCC/Caa

 

 

 

1

 

 

 

 

1

 

 

Not Rated6

 

 

 

10

 

 

 

 

8

 

 


 

 

 

 

5

Using the higher of S&P’s or Moody’s ratings.

 

 

 

 

6

The investment advisor has deemed certain of these securities to be of investment grade quality. As of April 30, 2012 and April 30, 2011, the market value of these securities was $24,953,999, representing 7%, and $3,863,321, representing 1%, respectively, of the Fund’s long-term investments.


 

 

 

 

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

7




 

 

 

 

Fund Summary as of April 30, 2012

BlackRock MuniHoldings Fund II, Inc.


 

Fund Overview

BlackRock MuniHoldings Fund II, Inc.’s (MUH) (the “Fund”) investment objective is to provide shareholders with current income exempt from federal income taxes. The Fund seeks to achieve its investment objective by investing, under normal market conditions, at least 80% of its assets in municipal bonds exempt from federal income taxes (except that the interest may be subject to the federal alternative minimum tax). The Fund invests, under normal market conditions, at least 75% of its assets in municipal bonds rated investment grade and invests primarily in long-term municipal bonds with a maturity of more than ten years at the time of investment. The Fund may invest directly in such securities or synthetically through the use of derivatives.

          No assurance can be given that the Fund’s investment objective will be achieved.

 

Performance

For the 12 months ended April 30, 2012, the Fund returned 31.60% based on market price and 26.08% based on NAV. For the same period, the closed-end Lipper General & Insured Municipal Debt Funds (Leveraged) category posted an average return of 25.51% based on market price and 23.04% based on NAV. All returns reflect reinvestment of dividends. The Fund moved from a discount to NAV to a premium by period end, which accounts for the difference between performance based on price and performance based on NAV. The following discussion relates to performance based on NAV. The primary factors contributing to positive performance during the period were the Fund’s duration positioning (preference for securities with a higher sensitivity to interest rate movements) and yield curve-flattening bias. The Fund has consistently emphasized longer-dated securities in order to benefit from long-term rates declining faster than short-term rates, a scenario that occurred during the period. In addition, sector concentrations in health and transportation proved beneficial, as did the avoidance of pre-refunded and escrowed issues, which underperformed the broader market. The Fund’s holdings generated a high distribution yield, which in the aggregate, had a meaningful impact on returns. Detracting from performance was the Fund’s long-standing focus on corporate-related debt, which modestly underperformed the market during the period.

 

 

 

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.


 

Fund Information


 

 

 

 

 

Symbol on NYSE

 

MUH

 

Initial Offering Date

 

February 27, 1998

 

Yield on Closing Market Price as of April 30, 2012 ($16.46)1

 

 

6.05%

 

Tax Equivalent Yield2

 

 

9.31%

 

Current Monthly Distribution per Common Share3

 

 

$0.0830

 

Current Annualized Distribution per Common Share3

 

 

$0.9960

 

Economic Leverage as of April 30, 20124

 

 

36%

 


 

 

 

 

1

Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.

 

 

 

 

2

Tax equivalent yield assumes the maximum federal tax rate of 35%.

 

 

 

 

3

The distribution rate is not constant and is subject to change.

 

 

 

 

4

Represents VMTP Shares and TOBs as a percentage of total managed assets, which is the total assets of the Fund, including any assets attributable to VMTP Shares and TOBs, minus the sum of accrued liabilities. For a discussion of leveraging techniques used by the Fund, please see The Benefits and Risks of Leveraging on page 12.

The table below summarizes the changes in the Fund’s market price and NAV per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4/30/12

 

4/30/11

 

Change

 

High

 

Low

 

Market Price

 

$

16.46

 

$

13.35

 

 

23.30

%

$

16.71

 

$

13.08

 

Net Asset Value

 

$

16.23

 

$

13.74

 

 

18.12

%

$

16.24

 

$

13.74

 

The following charts show the sector and credit quality allocations of the Fund’s long-term investments:

 

Sector Allocations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4/30/12

 

 

4/30/11

 

Health

 

 

 

21

%

 

 

 

22

%

 

Transportation

 

 

 

18

 

 

 

 

14

 

 

County/City/Special District/School District

 

 

 

16

 

 

 

 

14

 

 

State

 

 

 

14

 

 

 

 

13

 

 

Utilities

 

 

 

11

 

 

 

 

9

 

 

Education

 

 

 

10

 

 

 

 

9

 

 

Corporate

 

 

 

7

 

 

 

 

13

 

 

Tobacco

 

 

 

2

 

 

 

 

1

 

 

Housing

 

 

 

1

 

 

 

 

5

 

 


 

Credit Quality Allocations5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4/30/12

 

 

4/30/11

 

AAA/Aaa

 

 

 

12

%

 

 

 

13

%

 

AA/Aa

 

 

 

45

 

 

 

 

42

 

 

A

 

 

 

24

 

 

 

 

20

 

 

BBB/Baa

 

 

 

9

 

 

 

 

13

 

 

BB/Ba

 

 

 

 

 

 

 

1

 

 

B

 

 

 

2

 

 

 

 

1

 

 

CCC/Caa

 

 

 

1

 

 

 

 

2

 

 

Not Rated6

 

 

 

7

 

 

 

 

8

 

 


 

 

 

 

5

Using the higher of S&P’s or Moody’s ratings.

 

 

 

 

6

The investment advisor has deemed certain of these securities to be of investment grade quality. As of April 30, 2012 and April 30, 2011, the market value of these securities was $7,289,016, representing 3%, and $1,064,679, representing less than 1%, respectively, of the Fund’s long-term investments.


 

 

 

 

 

 

 

 

 

8

ANNUAL REPORT

APRIL 30, 2012

 




 

 

 

 

Fund Summary as of April 30, 2012

BlackRock MuniHoldings Quality Fund, Inc.


 

Fund Overview

BlackRock MuniHoldings Quality Fund, Inc.’s (MUS) (the “Fund”) investment objective is to provide shareholders with current income exempt from federal income taxes. The Fund seeks to achieve its investment objective by investing primarily in municipal obligations exempt from federal income taxes (except that the interest may be subject to the federal alternative minimum tax). Under normal market conditions, the Fund invests at least 80% of its assets in investment grade municipal obligations with remaining maturities of one year or more at the time of investment. The Fund may invest directly in such securities or synthetically through the use of derivatives.

 

 

 

No assurance can be given that the Fund’s investment objective will be achieved.


 

Performance

For the 12 months ended April 30, 2012, the Fund returned 25.90% based on market price and 24.96% based on NAV. For the same period, the closed-end Lipper General & Insured Municipal Debt Funds (Leveraged) category posted an average return of 25.51% based on market price and 23.04% based on NAV. All returns reflect reinvestment of dividends. The Fund’s discount to NAV, which narrowed during the period, accounts for the difference between performance based on price and performance based on NAV. The following discussion relates to performance based on NAV. The Fund’s exposure to bonds with longer-dated maturities had a positive impact on performance as the municipal yield curve flattened during the period. (Bond prices rise as their yields fall.) The Fund’s longer-dated holdings in the health, transportation and education sectors contributed most to the price appreciation in the Fund.

 

 

 

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.


 

Fund Information


 

 

 

Symbol on NYSE

 

MUS

Initial Offering Date

 

May 1, 1998

Yield on Closing Market Price as of April 30, 2012 ($14.52)1

 

6.12%

Tax Equivalent Yield2

 

9.42%

Current Monthly Distribution per Common Share3

 

$0.0740

Current Annualized Distribution per Common Share3

 

$0.8880

Economic Leverage as of April 30, 20124

 

40%


 

 

 

 

1

Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.

 

 

 

 

2

Tax equivalent yield assumes the maximum federal tax rate of 35%.

 

 

 

 

3

The distribution rate is not constant and is subject to change.

 

 

 

 

4

Represents VMTP Shares and TOBs as a percentage of total managed assets, which is the total assets of the Fund, including any assets attributable to VMTP Shares and TOBs, minus the sum of accrued liabilities. For a discussion of leveraging techniques used by the Fund, please see The Benefits and Risks of Leveraging on page 12.


The table below summarizes the changes in the Fund’s market price and NAV per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4/30/12

 

4/30/11

 

Change

 

High

 

Low

 

Market Price

 

$

14.52

 

$

12.31

 

 

17.95

%

$

15.04

 

$

11.73

 

Net Asset Value

 

$

14.61

 

$

12.48

 

 

17.07

%

$

14.71

 

$

12.48

 

The following charts show the sector and credit quality allocations of the Fund’s long-term investments:

 

Sector Allocations

 

 

 

 

 

 

 

 

 

 

4/30/12

 

4/30/11

 

County/City/Special District/School District

 

 

28

%

 

26

%

Transportation

 

 

22

 

 

21

 

Utilities

 

 

18

 

 

24

 

State

 

 

13

 

 

12

 

Health

 

 

9

 

 

9

 

Education

 

 

7

 

 

5

 

Housing

 

 

2

 

 

2

 

Tobacco

 

 

1

 

 

 

Corporate

 

 

 

 

1

 


 

Credit Quality Allocations5

 

 

 

 

 

 

 

 

 

 

4/30/12

 

4/30/11

 

AAA/Aaa

 

 

12

%

 

9

%

AA/Aa

 

 

65

 

 

69

 

A

 

 

21

 

 

18

 

BBB/Baa

 

 

1

 

 

4

 

B

 

 

1

 

 

 


 

 

 

 

5

Using the higher of S&P’s or Moody’s ratings.


 

 

 

 

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

9




 

 

 

 

Fund Summary as of April 30, 2012

BlackRock Muni Intermediate Duration Fund, Inc.


 

Fund Overview

BlackRock Muni Intermediate Duration Fund, Inc.’s (MUI) (the “Fund”) investment objective is to provide common shareholders with high current income exempt from federal income taxes. The Fund seeks to achieve its investment objective by investing at least 80% of its assets in municipal bonds exempt from federal income taxes (except that the interest may be subject to the federal alternative minimum tax). Under normal market conditions, the Fund invests at least 75% of its assets in municipal bonds rated investment grade and invests at least 80% of its assets in municipal bonds with a duration of three to ten years at the time of investment. The Fund may invest directly in such securities or synthetically through the use of derivatives.

 

 

 

No assurance can be given that the Fund’s investment objective will be achieved.


 

Performance

For the 12 months ended April 30, 2012, the Fund returned 27.56% based on market price and 18.74% based on NAV. For the same period, the closed-end Lipper Intermediate Municipal Debt Funds category posted an average return of 22.24% based on market price and 14.74% based on NAV. All returns reflect reinvestment of dividends. The Fund moved from a discount to NAV to a premium by period end, which accounts for the difference between performance based on price and performance based on NAV. The following discussion relates to performance based on NAV. The Fund benefited from its overall long duration bias (preference for securities with a higher sensitivity to interest rate movements) and its positioning toward the longer end of the municipal yield curve, within its intermediate duration mandate. These factors had the largest positive impact on returns as the municipal yield curve rallied lower (interest rates declined) and flattened (rates on the longer end of the curve fell the most) during the period. Also contributing positively to performance were the Fund’s heavy weightings in the tax-backed and health sectors.

 

 

 

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.


 

 

 

Fund Information

 

 

 

 

 

Symbol on NYSE

 

MUI

Initial Offering Date

 

August 1, 2003

Yield on Closing Market Price as of April 30, 2012 ($16.45)1

 

5.22%

Tax Equivalent Yield2

 

8.03%

Current Monthly Distribution per Common Share3

 

$0.0715

Current Annualized Distribution per Common Share3

 

$0.8580

Economic Leverage as of April 30, 20124

 

37%


 

 

 

 

1

Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.

 

 

 

 

2

Tax equivalent yield assumes the maximum federal tax rate of 35%.

 

 

 

 

3

The distribution rate is not constant and is subject to change.

 

 

 

 

4

Represents VRDP Shares and TOBs as a percentage of total managed assets, which is the total assets of the Fund, including any assets attributable to VRDP Shares and TOBs, minus the sum of accrued liabilities. For a discussion of leveraging techniques used by the Fund, please see The Benefits and Risks of Leveraging on page 12.

The table below summarizes the changes in the Fund’s market price and NAV per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4/30/12

 

4/30/11

 

Change

 

High

 

Low

 

Market Price

 

$

16.45

 

$

13.65

 

 

20.51

%

$

16.70

 

$

13.27

 

Net Asset Value

 

$

16.21

 

$

14.45

 

 

12.18

%

$

16.35

 

$

14.45

 

The following charts show the sector and credit quality allocations of the Fund’s long-term investments:

 

Sector Allocations

 

 

 

 

 

 

 

 

 

 

4/30/12

 

4/30/11

 

County/City/Special District/School District

 

 

23

%

 

21

%

State

 

 

20

 

 

22

 

Health

 

 

15

 

 

15

 

Education

 

 

10

 

 

8

 

Transportation

 

 

9

 

 

8

 

Utilities

 

 

9

 

 

5

 

Corporate

 

 

8

 

 

11

 

Tobacco

 

 

3

 

 

7

 

Housing

 

 

3

 

 

3

 


 

Credit Quality Allocations5

 

 

 

 

 

 

 

 

 

 

4/30/12

 

4/30/11

 

AAA/Aaa

 

 

11

%

 

14

%

AA/Aa

 

 

49

 

 

39

 

A

 

 

25

 

 

25

 

BBB/Baa

 

 

6

 

 

11

 

BB/Ba

 

 

1

 

 

1

 

B

 

 

2

 

 

1

 

CCC/Caa

 

 

 

 

1

 

Not Rated6

 

 

6

 

 

8

 


 

 

 

 

5

Using the higher of S&P’s or Moody’s ratings.

 

 

 

 

6

The investment advisor has deemed certain of these securities to be of investment grade quality. As of April 30, 2012 and April 30, 2011, the market value of these securities was $12,831,333, representing 1%, and $21,293,420, representing 2%, respectively, of the Fund’s long-term investments.


 

 

 

 

 

 

 

 

 

10

ANNUAL REPORT

APRIL 30, 2012

 




 

 

 

 

Fund Summary as of April 30, 2012

BlackRock MuniVest Fund II, Inc.


 

Fund Overview

BlackRock MuniVest Fund II, Inc.’s (MVT) (the “Fund”) investment objective is to provide shareholders with as high a level of current income exempt from federal income taxes as is consistent with its investment policies and prudent investment management. The Fund seeks to achieve its investment objective by investing at least 80% of its assets in municipal bonds exempt from federal income taxes (except that the interest may be subject to the federal alternative minimum tax). The Fund invests, under normal market conditions, at least 75% of its assets in municipal bonds rated investment grade and invests primarily in long-term municipal bonds with a maturity of more than ten years at the time of investment. The Fund may invest directly in such securities or synthetically through the use of derivatives.

          No assurance can be given that the Fund’s investment objective will be achieved.

 

Performance

For the 12 months ended April 30, 2012, the Fund returned 31.13% based on market price and 26.86% based on NAV. For the same period, the closed-end Lipper General & Insured Municipal Debt Funds (Leveraged) category posted an average return of 25.51% based on market price and 23.04% based on NAV. All returns reflect reinvestment of dividends. The Fund’s premium to NAV, which widened during the period, accounts for the difference between performance based on price and performance based on NAV. The following discussion relates to performance based on NAV. The primary factors contributing to positive performance during the period were the Fund’s duration positioning (preference for securities with a higher sensitivity to interest rate movements) and yield curve-flattening bias. The Fund has consistently emphasized longer-dated securities in order to benefit from long-term rates declining faster than short-term rates, a scenario that occurred during the period. In addition, sector concentrations in health and transportation proved beneficial, as did the avoidance of pre-refunded and escrowed issues, which underperformed the broader market. The Fund’s holdings generated a high distribution yield, which in the aggregate, had a meaningful impact on returns. Detracting from performance was the Fund’s long-standing focus on corporate-related debt, which modestly underperformed the market during the period.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

 

Fund Information


 

 

Symbol on NYSE

MVT

Initial Offering Date

March 29, 1993

Yield on Closing Market Price as of April 30, 2012 ($16.75)1

6.52%

Tax Equivalent Yield2

10.03%

Current Monthly Distribution per Common Share3

$0.0910

Current Annualized Distribution per Common Share3

$1.0920

Economic Leverage as of April 30, 20124

41%


 

 

1

Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.

 

 

2

Tax equivalent yield assumes the maximum federal tax rate of 35%.

 

 

3

The distribution rate is not constant and is subject to change.

 

 

4

Represents VMTP Shares and TOBs as a percentage of total managed assets, which is the total assets of the Fund, including any assets attributable to VMTP Shares and TOBs, minus the sum of accrued liabilities. For a discussion of leveraging techniques used by the Fund, please see The Benefits and Risks of Leveraging on page 12.

The table below summarizes the changes in the Fund’s market price and NAV per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4/30/12

 

4/30/11

 

Change

 

High

 

Low

 

Market Price

 

$

16.75

 

$

13.72

 

 

22.08

%

$

17.08

 

$

13.51

 

Net Asset Value

 

$

15.91

 

$

13.47

 

 

18.11

%

$

15.91

 

$

13.47

 

The following charts show the sector and credit quality allocations of the Fund’s long-term investments:

 

Sector Allocations

 

 

 

 

 

 

 

 

 

 

4/30/12

 

4/30/11

 

Health

 

21

%

 

25

%

 

Transportation

 

19

 

 

15

 

 

State

 

15

 

 

14

 

 

Utilities

 

11

 

 

10

 

 

Corporate

 

11

 

 

16

 

 

County/City/Special District/School District

 

10

 

 

9

 

 

Education

 

7

 

 

7

 

 

Tobacco

 

3

 

 

1

 

 

Housing

 

3

 

 

3

 

 


 

Credit Quality Allocations5

 

 

 

 

 

 

 

 

 

 

4/30/12

 

4/30/11

 

AAA/Aaa

 

9

%

 

10

%

 

AA/Aa

 

47

 

 

45

 

 

A

 

24

 

 

21

 

 

BBB/Baa

 

9

 

 

10

 

 

BB/Ba

 

1

 

 

2

 

 

B

 

3

 

 

2

 

 

CCC/Caa

 

 

 

1

 

 

Not Rated6

 

7

 

 

9

 

 


 

 

 

 

5

Using the higher of S&P’s or Moody’s ratings.

 

 

 

 

6

The investment advisor has deemed certain of these securities to be of investment grade quality. As of April 30, 2012 and April 30, 2011, the market value of these securities was $4,822,745 and $4,588,089, each representing 1%, respectively, of the Fund’s long-term investments.


 

 

 

 

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

11




 

 

The Benefits and Risks of Leveraging

The Funds may utilize leverage to seek to enhance the yield and NAV of their common shares (“Common Shares”). However, these objectives cannot be achieved in all interest rate environments.

To obtain leverage, the Funds, except MUA, issue Variable Rate Demand Preferred Shares (“VRDP Shares”) or Variable Rate Muni Term Preferred Shares (“VMTP Shares”) and previously issued and had outstanding Auction Market Preferred Shares (“AMPS”) (VRDP Shares, VMTP Shares, and as applicable AMPS, are collectively referred to as “Preferred Shares”). Preferred Shares pay dividends at prevailing short-term interest rates, and the Funds invest the proceeds in long-term municipal bonds. In general, the concept of leveraging is based on the premise that the financing cost of assets to be obtained from leverage, which will be based on short-term interest rates, will normally be lower than the income earned by each Fund on its longer-term portfolio investments. To the extent that the total assets of each Fund (including the assets obtained from leverage) are invested in higher-yielding portfolio investments, each Fund’s shareholders will benefit from the incremental net income.

To illustrate these concepts, assume a Fund’s Common Shares capitalization is $100 million and it issues Preferred Shares for an additional $50 million, creating a total value of $150 million available for investment in long-term municipal bonds. If prevailing short-term interest rates are 3% and long-term interest rates are 6%, the yield curve has a strongly positive slope. In this case, the Fund pays dividends on the $50 million of Preferred Shares based on the lower short-term interest rates. At the same time, the securities purchased by the Fund with assets received from Preferred Shares issuance earn income based on long-term interest rates. In this case, the dividends paid to holders of Preferred Shares (“Preferred Shareholders”) are significantly lower than the income earned on the Fund’s long-term investments, and therefore the Common Shareholders are the beneficiaries of the incremental net income.

If short-term interest rates rise, narrowing the differential between short-term and long-term interest rates, the incremental net income pickup will be reduced or eliminated completely. Furthermore, if prevailing short-term interest rates rise above long-term interest rates, the yield curve has a negative slope. In this case, the Fund pays higher short-term interest rates whereas the Fund’s total portfolio earns income based on lower long-term interest rates.

Furthermore, the value of the Funds’ portfolio investments generally varies inversely with the direction of long-term interest rates, although other factors can influence the value of portfolio investments. In contrast, the redemption value of the Funds’ Preferred Shares and/or debt securities does not fluctuate in relation to interest rates. As a result, changes in interest rates can influence the Funds’ NAVs positively or negatively in addition to the impact on Fund performance from leverage from Preferred Shares and borrowings discussed above.

The Funds may also leverage their assets through the use of TOBs, as described in Note 1 of the Notes to Financial Statements. TOB investments generally will provide the Funds with economic benefits in periods of declining short-term interest rates, but expose the Funds to risks during periods of rising short-term interest rates similar to those associated with Preferred Shares issued by the Funds, as described above. Additionally, fluctuations in the market value of municipal bonds deposited into the TOB trust may adversely affect each Fund’s NAV per share.

The use of leverage may enhance opportunities for increased income to the Funds and Common Shareholders, but as described above, it also creates risks as short- or long-term interest rates fluctuate. Leverage also will generally cause greater changes in the Funds’ NAVs, market prices and dividend rates than comparable portfolios without leverage. If the income derived from securities purchased with assets received from leverage exceeds the cost of leverage, the Funds’ net income will be greater than if leverage had not been used. Conversely, if the income from the securities purchased is not sufficient to cover the cost of leverage, each Fund’s net income will be less than if leverage had not been used, and therefore the amount available for distribution to Common Shareholders will be reduced. Each Fund may be required to sell portfolio securities at inopportune times or at distressed values in order to comply with regulatory requirements applicable to the use of leverage or as required by the terms of leverage instruments, which may cause a Fund to incur losses. The use of leverage may limit each Fund’s ability to invest in certain types of securities or use certain types of hedging strategies, such as in the case of certain restrictions imposed by rating agencies that rate the Preferred Shares issued by the Funds. Each Fund will incur expenses in connection with the use of leverage, all of which are borne by Common Shareholders and may reduce income to the Common Shares.

Under the Investment Company Act of 1940, as amended (the “1940 Act”), the Funds are permitted to issue senior securities in the form of equity securities (e.g., Preferred Shares) up to 50% of their total managed assets (each Fund’s total assets less the sum of its accrued liabilities). In addition, each Fund voluntarily limits its economic leverage to 50% of its total managed assets and 45% for Funds with VRDP Shares or VMTP Shares. As of April 30, 2012, the Funds had economic leverage from Preferred Shares and/or TOBs as a percentage of their total managed assets as follows:

 

 

 

 

 

 

 

Percent of
Economic
Leverage

 

MUA

 

11

%

 

MEN

 

37

%

 

MHD

 

37

%

 

MUH

 

36

%

 

MUS

 

40

%

 

MUI

 

37

%

 

MVT

 

41

%

 


 

 

Derivative Financial Instruments

The Funds may invest in various derivative financial instruments, including financial futures contracts as specified in Note 2 of the Notes to Financial Statements, which may constitute forms of economic leverage. Such derivative financial instruments are used to obtain exposure to a market without owning or taking physical custody of securities or to hedge market, interest rate and/or other risks. Derivative financial instruments involve risks, including the imperfect correlation between the value of a derivative financial instrument and the underlying asset, possible default of the counterparty to the transaction or illiquidity of the derivative financial instrument. The Funds’ ability to use a derivative financial instrument successfully depends on the investment advisor’s ability to predict pertinent market movements accurately, which cannot be assured. The use of derivative financial instruments may result in losses greater than if they had not been used, may require a Fund to sell or purchase portfolio investments at inopportune times or for distressed values, may limit the amount of appreciation a Fund can realize on an investment, may result in lower dividends paid to shareholders or may cause a Fund to hold an investment that it might otherwise sell. The Funds’ investments in these instruments are discussed in detail in the Notes to Financial Statements.

 

 

 

 

 

 

12

ANNUAL REPORT

APRIL 30, 2012




 

 

 

 

Schedule of Investments April 30, 2012

BlackRock MuniAssets Fund, Inc. (MUA)

 

(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Alabama — 1.4%

 

 

 

 

 

 

 

Alabama State Docks Department, Refunding RB,
6.00%, 10/01/40

 

$

2,165

 

$

2,393,602

 

County of Jefferson Alabama, RB, Series A:

 

 

 

 

 

 

 

5.25%, 1/01/17

 

 

895

 

 

892,404

 

5.25%, 1/01/19

 

 

2,000

 

 

1,973,340

 

5.50%, 1/01/21

 

 

1,215

 

 

1,210,517

 

 

 

 

 

 

 

6,469,863

 

Alaska — 1.4%

 

 

 

 

 

 

 

Northern Tobacco Securitization Corp., RB, Tobacco
Settlement, Asset-Backed, Series A, 4.63%, 6/01/23

 

 

1,890

 

 

1,869,739

 

Northern Tobacco Securitization Corp., Refunding RB,
Tobacco Settlement, Asset-Backed, Series A:

 

 

 

 

 

 

 

5.00%, 6/01/32

 

 

1,500

 

 

1,282,485

 

5.00%, 6/01/46

 

 

4,885

 

 

3,698,238

 

 

 

 

 

 

 

6,850,462

 

Arizona — 3.5%

 

 

 

 

 

 

 

Maricopa County IDA Arizona, RB, Arizona Charter
Schools Project, Series A, 6.63%, 7/01/20

 

 

2,120

 

 

1,695,173

 

Phoenix IDA Arizona, ERB, Great Hearts Academies —
Veritas Project:

 

 

 

 

 

 

 

6.30%, 7/01/42

 

 

500

 

 

516,675

 

6.40%, 7/01/47

 

 

425

 

 

439,476

 

Phoenix IDA Arizona, Refunding RB, America West
Airlines Inc. Project, AMT, 6.30%, 4/01/23

 

 

7,750

 

 

6,794,115

 

Pima County IDA, ERB, Arizona Charter School Project,
Series E, 7.25%, 7/01/31

 

 

2,255

 

 

2,257,187

 

Pima County IDA Arizona, ERB, Series A:

 

 

 

 

 

 

 

6.75%, 7/01/12 (a)

 

 

170

 

 

171,885

 

6.75%, 7/01/31

 

 

490

 

 

490,098

 

Salt Verde Financial Corp., RB, Senior, 5.00%, 12/01/32

 

 

1,840

 

 

1,875,604

 

Show Low Improvement District, Special Assessment
Bonds, District No. 5, 6.38%, 1/01/15

 

 

450

 

 

451,408

 

Tempe IDA, Refunding RB, Friendship Village of Tempe,
Series A, 6.25%, 12/01/42

 

 

720

 

 

738,202

 

University Medical Center Corp. Arizona, RB:

 

 

 

 

 

 

 

6.25%, 7/01/29

 

 

820

 

 

932,865

 

6.50%, 7/01/39

 

 

500

 

 

567,210

 

 

 

 

 

 

 

16,929,898

 

 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

California — 4.2%

 

 

 

 

 

 

 

California Statewide Communities Development
Authority, RB, Series A, 5.00%, 4/01/42

 

$

2,245

 

$

2,395,033

 

California Statewide Communities Development
Authority, Refunding RB, American Baptist Homes of
the West, 6.25%, 10/01/39

 

 

2,175

 

 

2,303,021

 

City of Fontana California, Special Tax Bonds, Refunding
RB, Community Facilities District No. 22-Sierra,
Series H, 6.00%, 9/01/34

 

 

2,320

 

 

2,346,425

 

City of San Jose California, RB, Convention Center
Expansion & Renovation Project:

 

 

 

 

 

 

 

6.50%, 5/01/36

 

 

900

 

 

1,022,760

 

6.50%, 5/01/42

 

 

2,220

 

 

2,510,065

 

Foothill Eastern Transportation Corridor Agency, California,
Refunding RB, CAB, 6.30%, 1/15/33 (b)

 

 

12,450

 

 

3,506,791

 

San Marcos County Unified School District, GO, CAB,
Series B (b)(c):

 

 

 

 

 

 

 

5.54%, 8/01/40

 

 

5,000

 

 

1,076,550

 

5.80%, 8/01/51

 

 

12,050

 

 

1,319,475

 

Tobacco Securitization Authority of Southern California,
Refunding RB, Series A1-SNR, 5.00%, 6/01/37

 

 

4,860

 

 

3,727,669

 

 

 

 

 

 

 

20,207,789

 

Colorado — 1.3%

 

 

 

 

 

 

 

Plaza Metropolitan District No. 1 Colorado, Tax Allocation
Bonds, Public Improvement Fee, Tax Increment:

 

 

 

 

 

 

 

8.00%, 12/01/25

 

 

4,850

 

 

5,009,807

 

Subordinate, 8.13%, 12/01/25

 

 

1,025

 

 

1,003,834

 

 

 

 

 

 

 

6,013,641

 

Connecticut — 0.9%

 

 

 

 

 

 

 

Connecticut State Development Authority, RB, AFCO
Cargo BDL LLC Project, AMT, 8.00%, 4/01/30 (d)(e)

 

 

3,450

 

 

2,092,528

 

Mohegan Tribe of Indians of Connecticut, RB, Public
Improvement, Priority Distribution:

 

 

 

 

 

 

 

6.25%, 1/01/31

 

 

1,370

 

 

1,196,147

 

5.25%, 1/01/33 (f)

 

 

1,500

 

 

1,132,110

 

 

 

 

 

 

 

4,420,785

 

Delaware — 1.0%

 

 

 

 

 

 

 

County of Sussex Delaware, RB, NRG Energy, Inc., Indian
River Project, 6.00%, 10/01/40

 

 

1,000

 

 

1,082,820

 

Delaware State EDA, RB, Exempt Facilities, Indian River
Power, 5.38%, 10/01/45

 

 

3,625

 

 

3,742,486

 

 

 

 

 

 

 

4,825,306

 


 

 

Portfolio Abbreviations

 

 

To simplify the listings of portfolio holdings in the Schedules of Investments, the names and descriptions of many of the securities have been abbreviated according to the following list:

 

 

ACA

American Capital Access Corp.

AGC

Assured Guaranty Corp.

AGM

Assured Guaranty Municipal Corp.

AMBAC

American Municipal Bond Assurance Corp.

AMT

Alternative Minimum Tax (subject to)

ARB

Airport Revenue Bonds

BHAC

Berkshire Hathaway Assurance Corp.

CAB

Capital Appreciation Bonds

COP

Certificates of Participation

EDA

Economic Development Authority

EDC

Economic Development Corp.

ERB

Education Revenue Bonds

FSA

Financial Security Assurance Inc.

GARB

General Airport Revenue Bonds

GO

General Obligation Bonds

HDA

Housing Development Authority

HFA

Housing Finance Agency

HRB

Housing Revenue Bonds

IDA

Industrial Development Authority

IDB

Industrial Development Board

ISD

Independent School District

LRB

Lease Revenue Bonds

M/F

Multi-Family

MRB

Mortgage Revenue Bonds

NPFGC

National Public Finance Guarantee Corp.

PSF-GTD

Permanent School Fund Guaranteed

Q-SBLF

Qualified School Bond Loan Fund

RB

Revenue Bonds

Radian

Radian Financial Guaranty

S/F

Single-Family

SBPA

Stand-by Bond Purchase Agreement

Syncora

Syncora Guarantee

TRAN

Tax Revenue Anticipation Notes

VRDN

Variable Rate Demand Notes


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

13




 

 

 

 

Schedule of Investments (continued)

BlackRock MuniAssets Fund, Inc. (MUA)

 

(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

District of Columbia — 1.6%

 

 

 

 

 

 

 

District of Columbia, RB, Methodist Home District of
Columbia, Series A:

 

 

 

 

 

 

 

7.38%, 1/01/30

 

$

1,665

 

$

1,716,415

 

7.50%, 1/01/39

 

 

2,725

 

 

2,807,295

 

District of Columbia Tobacco Settlement Financing Corp.,
Refunding RB, Asset-Backed, 6.50%, 5/15/33

 

 

2,785

 

 

3,041,554

 

 

 

 

 

 

 

7,565,264

 

Florida — 10.5%

 

 

 

 

 

 

 

Greater Orlando Aviation Authority Florida, RB, Special
Purpose, JetBlue Airways Corp., AMT, 6.38%, 11/15/26

 

 

4,500

 

 

4,534,065

 

Harbor Bay Community Development District Florida,
Special Assessment Bonds, Series A, 7.00%, 5/01/33

 

 

455

 

 

455,064

 

Hillsborough County IDA, RB, AMT, National Gypsum Co:

 

 

 

 

 

 

 

Series A, 7.13%, 4/01/30

 

 

4,500

 

 

4,457,025

 

Series B, 7.13%, 4/01/30

 

 

1,560

 

 

1,544,166

 

Jacksonville Economic Development Commission, RB,
Gerdau Ameristeel US Inc., AMT, 5.30%, 5/01/37

 

 

4,500

 

 

4,334,130

 

Jacksonville Economic Development Commission,
Refunding RB, Florida Proton Therapy Institute,
Series A, 6.00%, 9/01/17

 

 

1,365

 

 

1,516,379

 

Lakewood Ranch Stewardship District, Special
Assessment Bonds, Lakewood Center & New Sector
Projects, 8.00%, 5/01/40

 

 

1,485

 

 

1,590,108

 

Mid-Bay Bridge Authority, RB, Series A, 7.25%, 10/01/40

 

 

4,550

 

 

5,274,224

 

Midtown Miami Community Development District,
Special Assessment Bonds, Series A:

 

 

 

 

 

 

 

6.00%, 5/01/24

 

 

1,240

 

 

1,254,173

 

6.25%, 5/01/37

 

 

4,605

 

 

4,646,307

 

Palm Beach County Health Facilities Authority, RB, Acts
Retirement Life Community, 5.50%, 11/15/33

 

 

3,500

 

 

3,700,095

 

Santa Rosa Bay Bridge Authority, RB, 6.25%,
7/01/28 (d)(e)

 

 

5,180

 

 

2,013,673

 

Sarasota County Health Facilities Authority, Refunding
RB, Village On The Isle Project, 5.50%, 1/01/27

 

 

955

 

 

982,991

 

Sumter Landing Community Development District
Florida, RB, Sub-Series B, 5.70%, 10/01/38

 

 

3,885

 

 

3,372,219

 

Tampa Palms Open Space & Transportation Community
Development District, RB, Capital Improvement,
Richmond Place Project, 7.50%, 5/01/18

 

 

1,520

 

 

1,521,170

 

Tolomato Community Development District, Special
Assessment Bonds, 6.65%, 5/01/40 (d)(e)

 

 

4,525

 

 

1,927,650

 

Village Community Development District No. 9, Special
Assessment Bonds:

 

 

 

 

 

 

 

6.75%, 5/01/31

 

 

1,990

 

 

2,236,919

 

7.00%, 5/01/41

 

 

3,225

 

 

3,625,803

 

5.50%, 5/01/42

 

 

1,380

 

 

1,406,579

 

 

 

 

 

 

 

50,392,740

 

Georgia — 3.0%

 

 

 

 

 

 

 

City of Atlanta Georgia, Tax Allocation Bonds, Princeton
Lakes Project, 5.50%, 1/01/31

 

 

1,035

 

 

1,037,639

 

Clayton County Development Authority, RB, Delta Air
Lines Inc. Project, Series A, 8.75%, 6/01/29

 

 

3,365

 

 

3,913,495

 

County of Clayton Georgia, Tax Allocation Bonds,
Ellenwood Project, 7.50%, 7/01/33

 

 

2,765

 

 

2,818,060

 

DeKalb County Hospital Authority Georgia, RB, Dekalb
Medical Center Inc. Project, 6.13%, 9/01/40

 

 

2,005

 

 

2,175,565

 

Gainesville & Hall County Development Authority,
Refunding RB, Acts Retirement Life Community,
Series A-2:

 

 

 

 

 

 

 

6.38%, 11/15/29

 

 

700

 

 

786,940

 

6.63%, 11/15/39

 

 

880

 

 

978,833

 

 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Georgia (concluded)

 

 

 

 

 

 

 

Private Colleges & Universities Authority, RB, Mercer
University Project, Series A:

 

 

 

 

 

 

 

5.25%, 10/01/27

 

$

1,790

 

$

1,893,498

 

5.00%, 10/01/32

 

 

855

 

 

869,099

 

 

 

 

 

 

 

14,473,129

 

Guam — 0.7%

 

 

 

 

 

 

 

Guam Government Waterworks Authority, Refunding RB,
Water & Wastewater Systems, 6.00%, 7/01/25

 

 

1,265

 

 

1,294,108

 

Territory of Guam, GO, Series A:

 

 

 

 

 

 

 

6.00%, 11/15/19

 

 

615

 

 

657,650

 

7.00%, 11/15/39

 

 

1,115

 

 

1,217,792

 

 

 

 

 

 

 

3,169,550

 

Illinois — 4.5%

 

 

 

 

 

 

 

City of Chicago Illinois, Refunding RB, American
Airlines Inc. Project, 5.50%, 12/01/30 (d)(e)

 

 

7,000

 

 

3,744,860

 

Illinois Finance Authority, RB:

 

 

 

 

 

 

 

Roosevelt University Project, 6.50%, 4/01/44

 

 

4,170

 

 

4,521,322

 

Illinois Finance Authority, Refunding RB:

 

 

 

 

 

 

 

CAB, Clare Water Tower, Series B, 0.00%,
5/15/50 (b)(d)(e)

 

 

1,500

 

 

283,470

 

Clare Water Tower, Series A-7, 6.13%, 5/15/41 (d)(e)

 

 

3,500

 

 

780,430

 

Friendship Village Of Schaumburg, 7.25%, 2/15/45

 

 

4,000

 

 

4,174,400

 

Primary Health Care Centers Program, 6.60%,
7/01/24

 

 

1,175

 

 

1,124,922

 

Metropolitan Pier & Exposition Authority, Refunding RB,
CAB, McCormick Place Expansion Project, Series B
(AGM), 6.25%, 6/15/46 (b)

 

 

9,860

 

 

1,563,500

 

Railsplitter Tobacco Settlement Authority, RB:

 

 

 

 

 

 

 

5.50%, 6/01/23

 

 

1,400

 

 

1,599,878

 

6.00%, 6/01/28

 

 

710

 

 

805,680

 

Village of Lincolnshire Illinois, Special Tax Bonds,
Sedgebrook Project, 6.25%, 3/01/34

 

 

1,800

 

 

1,731,492

 

Village of Wheeling Illinois, Tax Allocation Bonds, North
Milwaukee/Lake-Cook TIF Project, 6.00%, 1/01/25

 

 

1,465

 

 

1,438,132

 

 

 

 

 

 

 

21,768,086

 

Kentucky — 1.1%

 

 

 

 

 

 

 

Kentucky Economic Development Finance Authority, RB,
Owensboro Medical Health System, Series A:

 

 

 

 

 

 

 

6.38%, 6/01/40

 

 

1,580

 

 

1,807,662

 

6.50%, 3/01/45

 

 

2,000

 

 

2,300,700

 

Kentucky Economic Development Finance Authority,
Refunding RB, Owensboro Medical Health System,
Series B, 6.38%, 3/01/40

 

 

1,135

 

 

1,298,542

 

 

 

 

 

 

 

5,406,904

 

Louisiana — 1.6%

 

 

 

 

 

 

 

Louisiana Local Government Environmental Facilities &
Community Development Authority, RB, 6.75%,
11/01/32

 

 

5,000

 

 

5,504,900

 

Louisiana Public Facilities Authority, RB, Belle Chasse
Educational Foundation Project, 6.75%, 5/01/41

 

 

1,855

 

 

2,073,055

 

 

 

 

 

 

 

7,577,955

 

Maine — 0.7%

 

 

 

 

 

 

 

Maine Health & Higher Educational Facilities Authority,
RB, Maine General Medical Center, 6.75%, 7/01/41

 

 

2,955

 

 

3,299,110

 

Maryland — 2.6%

 

 

 

 

 

 

 

Maryland EDC, RB, Transportation Facilities Project,
Series A, 5.75%, 6/01/35

 

 

3,615

 

 

3,834,033

 

Maryland EDC, Refunding RB, CNX Marine Terminals Inc.,
5.75%, 9/01/25

 

 

4,785

 

 

5,008,555

 

Maryland Health & Higher Educational Facilities
Authority, RB, Washington Christian Academy, 5.50%,
7/01/38 (d)(e)

 

 

1,000

 

 

399,990

 


 

 

 

 

See Notes to Financial Statements.

 

14

ANNUAL REPORT

APRIL 30, 2012

 




 

 

 

 

Schedule of Investments (continued)

BlackRock MuniAssets Fund, Inc. (MUA)

 

(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Maryland (concluded)

 

 

 

 

 

 

 

Maryland Health & Higher Educational Facilities
Authority, Refunding RB, Doctor’s Community
Hospital, 5.75%, 7/01/38

 

$

3,110

 

$

3,275,265

 

 

 

 

 

 

 

12,517,843

 

Massachusetts — 0.6%

 

 

 

 

 

 

 

Massachusetts Development Finance Agency, RB:

 

 

 

 

 

 

 

Eastern Nazarene College, 5.63%, 4/01/19

 

 

35

 

 

35,015

 

Foxborough Regional Charter School, Series A,
7.00%, 7/01/42

 

 

1,025

 

 

1,152,971

 

Massachusetts Development Finance Agency,
Refunding RB:

 

 

 

 

 

 

 

Eastern Nazarene College, 5.63%, 4/01/29

 

 

80

 

 

78,331

 

Tufts Medical Center, Series I, 6.75%, 1/01/36

 

 

1,490

 

 

1,708,747

 

 

 

 

 

 

 

2,975,064

 

Michigan — 2.4%

 

 

 

 

 

 

 

Detroit Michigan Capital Improvement, GO, Limited Tax,
Series A-1, 5.00%, 4/01/16

 

 

650

 

 

595,439

 

Monroe County Hospital Finance Authority, Refunding RB,
Mercy Memorial Hospital Corp. Obligation, 5.50%,
6/01/35

 

 

3,000

 

 

3,026,010

 

Royal Oak Hospital Finance Authority Michigan,
Refunding RB, William Beaumont Hospital, 8.25%,
9/01/39

 

 

6,310

 

 

8,024,301

 

 

 

 

 

 

 

11,645,750

 

Minnesota — 0.4%

 

 

 

 

 

 

 

City of Minneapolis Minnesota, Refunding RB, Fairview
Health Services, Series A, 6.75%, 11/15/32

 

 

1,785

 

 

2,087,433

 

Missouri — 0.6%

 

 

 

 

 

 

 

Kirkwood IDA Missouri, RB, Aberdeen Heights, Series A,
8.25%, 5/15/39

 

 

2,315

 

 

2,597,870

 

Nebraska — 0.5%

 

 

 

 

 

 

 

Central Plains Energy Project Nebraska, RB:

 

 

 

 

 

 

 

5.25%, 9/01/37

 

 

840

 

 

873,264

 

5.00%, 9/01/42

 

 

1,475

 

 

1,479,631

 

 

 

 

 

 

 

2,352,895

 

Nevada — 0.2%

 

 

 

 

 

 

 

County of Clark Nevada, Special Assessment Bonds,
Special Improvement District No. 142, Local
Improvement, 6.38%, 8/01/23

 

 

955

 

 

986,181

 

New Jersey — 7.0%

 

 

 

 

 

 

 

New Jersey EDA, RB:

 

 

 

 

 

 

 

Continental Airlines Inc. Project, AMT, 6.25%,
9/15/19

 

 

2,000

 

 

2,004,800

 

Continental Airlines Inc. Project, AMT, 6.25%,
9/15/29

 

 

4,330

 

 

4,340,392

 

Continental Airlines Inc. Project, AMT, 9.00%,
6/01/33 (g)

 

 

1,250

 

 

1,340,050

 

Kapkowski Road Landfill Project, Series 1998B-MB,
AMT, 6.50%, 4/01/31

 

 

2,250

 

 

2,551,050

 

Paterson Charter School for Science and Technology,
Inc. Project, Series 2012A, 6.10%, 7/01/44

 

 

1,085

 

 

1,096,349

 

New Jersey EDA, Refunding RB:

 

 

 

 

 

 

 

Cigarette Tax, 5.00%, 6/15/23

 

 

995

 

 

1,115,604

 

Newark Airport Marriott Hotel, 7.00%, 10/01/14

 

 

4,000

 

 

4,018,280

 

New Jersey Educational Facilities Authority, Refunding RB,
University of Medicine & Dentistry, Series B:

 

 

 

 

 

 

 

7.13%, 12/01/23

 

 

670

 

 

825,674

 

7.50%, 12/01/32

 

 

3,575

 

 

4,335,367

 

 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

New Jersey (concluded)

 

 

 

 

 

 

 

New Jersey Health Care Facilities Financing Authority, RB:

 

 

 

 

 

 

 

Pascack Valley Hospital Association, 6.63%,
7/01/36 (d)(e)

 

$

3,870

 

$

39

 

RWJ Healthcare Corporation, Series B, 5.00%,
7/01/35

 

 

3,080

 

 

2,898,619

 

New Jersey Health Care Facilities Financing Authority,
Refunding RB:

 

 

 

 

 

 

 

Barnabas Health, Series A, 5.63%, 7/01/37

 

 

2,650

 

 

2,800,361

 

St. Joseph’s Healthcare System, 6.63%, 7/01/38

 

 

4,090

 

 

4,669,144

 

New Jersey Transportation Trust Fund Authority, RB,
Transportation System, Series C (AMBAC), 5.05%,
12/15/35 (b)

 

 

6,210

 

 

1,799,596

 

 

 

 

 

 

 

33,795,325

 

New York — 4.7%

 

 

 

 

 

 

 

Chautauqua County Industrial Development Agency, RB,
NRG Dunkirk Power Project, 5.88%, 4/01/42

 

 

3,695

 

 

3,953,022

 

Dutchess County Industrial Development Agency New York,
RB, St. Francis Hospital, Series B, 7.50%, 3/01/29

 

 

1,000

 

 

1,020,250

 

Dutchess County Industrial Development Agency New York,
Refunding RB, St. Francis Hospital, Series A, 7.50%,
3/01/29

 

 

1,400

 

 

1,428,350

 

Metropolitan Transportation Authority, RB, Series 2008C,
6.50%, 11/15/28

 

 

2,000

 

 

2,535,240

 

New York City Industrial Development Agency, RB:

 

 

 

 

 

 

 

American Airlines Inc., JFK International Airport, AMT,
8.00%, 8/01/28 (d)(e)(g)

 

 

1,765

 

 

1,800,265

 

British Airways Plc Project, 7.63%, 12/01/32

 

 

4,130

 

 

4,264,225

 

Series C, 6.80%, 6/01/28

 

 

860

 

 

883,848

 

Special Needs Facilities Pooled Program, Series C-1,
6.50%, 7/01/24

 

 

610

 

 

605,584

 

Special Needs Facilities Pooled Program, Series C-1,
6.63%, 7/01/29

 

 

1,100

 

 

1,064,228

 

New York Liberty Development Corp., Refunding RB,
Second Priority, Bank of America Tower at One Bryant
Park Project, Class 3, 6.38%, 7/15/49

 

 

1,270

 

 

1,413,929

 

Port Authority of New York & New Jersey, RB, JFK
International Air Terminal, 6.00%, 12/01/36

 

 

1,340

 

 

1,500,518

 

Yonkers Industrial Development Agency New York, RB,
Sarah Lawrence College Project, Series A, 6.00%,
6/01/41

 

 

2,090

 

 

2,315,720

 

 

 

 

 

 

 

22,785,179

 

North Carolina — 1.6%

 

 

 

 

 

 

 

North Carolina Medical Care Commission, RB, First
Mortgage, Series A:

 

 

 

 

 

 

 

Deerfield, 6.13%, 11/01/38

 

 

4,565

 

 

4,875,831

 

Whitestone, 7.75%, 3/01/31

 

 

1,000

 

 

1,083,240

 

Whitestone, 7.75%, 3/01/41

 

 

1,420

 

 

1,519,982

 

 

 

 

 

 

 

7,479,053

 

Ohio — 1.6%

 

 

 

 

 

 

 

Buckeye Tobacco Settlement Financing Authority, RB,
Asset-Backed, Senior Series A-2, 5.13%, 6/01/24

 

 

3,350

 

 

2,729,245

 

State of Ohio, RB, Ford Motor Co. Project, AMT, 5.75%,
4/01/35

 

 

4,880

 

 

4,904,400

 

 

 

 

 

 

 

7,633,645

 

Pennsylvania — 6.4%

 

 

 

 

 

 

 

Allegheny County Hospital Development Authority, RB,
Health System, West Penn, Series A, 5.38%, 11/15/40

 

 

3,540

 

 

2,950,413

 

Bucks County IDA, RB, Ann’s Choice, Inc. Facility, Series A:

 

 

 

 

 

 

 

6.13%, 1/01/25

 

 

1,360

 

 

1,370,241

 

6.25%, 1/01/35

 

 

1,550

 

 

1,553,968

 

Cumberland County Municipal Authority, RB, Diakon
Lutheran, 6.38%, 1/01/39

 

 

6,165

 

 

6,596,981

 


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

15




 

 

 

 

Schedule of Investments (continued)

BlackRock MuniAssets Fund, Inc. (MUA)

(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Pennsylvania (concluded)

 

 

 

 

 

 

 

Lancaster County Hospital Authority, RB, Brethren Village
Project, Series A, 6.25%, 7/01/26

 

$

1,160

 

$

1,222,002

 

Montgomery County IDA Pennsylvania, MRB, Whitemarsh
Continuing Care, 6.13%, 2/01/28

 

 

2,330

 

 

2,310,009

 

Pennsylvania Economic Development Financing Authority,
RB, National Gypsum Co., Series A, AMT, 6.25%,
11/01/27

 

 

3,250

 

 

2,950,317

 

Philadelphia Authority for Industrial Development,
RB, AMT:

 

 

 

 

 

 

 

Commercial Development, 7.75%, 12/01/17

 

 

8,000

 

 

8,010,160

 

Subordinate, Air Cargo, Series A, 7.50%, 1/01/25

 

 

3,870

 

 

3,846,006

 

 

 

 

 

 

 

30,810,097

 

Puerto Rico — 1.8%

 

 

 

 

 

 

 

Puerto Rico Commonwealth Aqueduct & Sewer Authority,
RB, Senior Lien, Series A:

 

 

 

 

 

 

 

5.13%, 7/01/37

 

 

345

 

 

344,248

 

5.25%, 7/01/42

 

 

580

 

 

578,214

 

Puerto Rico Electric Power Authority, Refunding RB,
Series A, 5.00%, 7/01/42 (c)

 

 

3,785

 

 

3,778,868

 

Puerto Rico Sales Tax Financing Corp., RB, First
Sub-Series A, 6.50%, 8/01/44

 

 

2,650

 

 

3,106,992

 

Puerto Rico Sales Tax Financing Corp., Refunding RB,
First Sub-Series C, 6.53%, 8/01/38 (b)

 

 

4,445

 

 

951,186

 

 

 

 

 

 

 

8,759,508

 

Rhode Island — 0.7%

 

 

 

 

 

 

 

Central Falls Detention Facility Corp., Refunding RB,
7.25%, 7/15/35

 

 

4,245

 

 

3,525,770

 

Tennessee — 0.1%

 

 

 

 

 

 

 

Shelby County Health Educational & Housing Facilities
Board Tennessee, RB, Village at Germantown, 6.25%,
12/01/34

 

 

575

 

 

516,206

 

Texas — 12.4%

 

 

 

 

 

 

 

Bexar County Health Facilities Development Corp., RB,
Army Retirement Residence Project, 6.20%, 7/01/45

 

 

5,040

 

 

5,486,947

 

Brazos River Authority, Refunding RB, Texas Utility Co.,
Series A, AMT, 7.70%, 4/01/33

 

 

5,080

 

 

722,579

 

Central Texas Regional Mobility Authority, RB:

 

 

 

 

 

 

 

CAB, 7.48%, 1/01/28 (b)

 

 

1,000

 

 

420,870

 

CAB, 7.56%, 1/01/29 (b)

 

 

2,000

 

 

786,240

 

CAB, 7.65%, 1/01/30 (b)

 

 

1,170

 

 

428,969

 

CAB, 7.71%, 1/01/31 (b)

 

 

2,000

 

 

687,780

 

CAB, 7.77%, 1/01/32 (b)

 

 

3,500

 

 

1,130,255

 

CAB, 7.78%, 1/01/33 (b)

 

 

3,690

 

 

1,120,542

 

CAB, 7.79%, 1/01/34 (b)

 

 

4,000

 

 

1,132,240

 

Senior Lien, 5.75%, 1/01/25

 

 

675

 

 

739,476

 

Senior Lien, 6.25%, 1/01/46

 

 

2,210

 

 

2,436,547

 

City of Houston Texas, RB, Special Facilities, AMT:

 

 

 

 

 

 

 

Continental Airlines, Series E, 6.75%, 7/01/21

 

 

4,550

 

 

4,586,173

 

Continental Airlines Inc. Terminal Projects, 6.63%,
7/15/38

 

 

2,890

 

 

3,079,151

 

Clifton Higher Education Finance Corp., ERB, Idea
Public Schools:

 

 

 

 

 

 

 

5.50%, 8/15/31

 

 

955

 

 

1,032,833

 

5.75%, 8/15/41

 

 

720

 

 

777,456

 

Harris County Health Facilities Development Corp.,
Refunding RB, Memorial Hermann Healthcare System,
Series B:

 

 

 

 

 

 

 

7.13%, 12/01/31

 

 

1,500

 

 

1,797,795

 

7.25%, 12/01/35

 

 

1,110

 

 

1,324,807

 

Houston Higher Education Finance Corp., RB, Cosmos
Foundation, Inc. Series A, 6.88%, 5/15/41

 

 

595

 

 

711,227

 

La Vernia Higher Education Finance Corp., RB, KIPP Inc.,
Series A, 6.38%, 8/15/44

 

 

860

 

 

964,894

 

 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Texas (concluded)

 

 

 

 

 

 

 

Love Field Airport Modernization Corp., RB, Southwest
Airlines Co. Project, 5.25%, 11/01/40

 

$

1,500

 

$

1,550,580

 

Matagorda County Navigation District No. 1 Texas,
Refunding RB, Central Power & Light Co. Project,
Series A, 6.30%, 11/01/29

 

 

2,090

 

 

2,385,965

 

North Texas Education Finance Corporation, ERB, Uplift
Education, Series 2012A:

 

 

 

 

 

 

 

5.13%, 12/01/42

 

 

745

 

 

747,295

 

5.25%, 12/01/47

 

 

1,600

 

 

1,604,896

 

North Texas Tollway Authority, RB, CAB, Special Projects
System, Series B, 7.55%, 9/01/37 (b)

 

 

2,110

 

 

507,539

 

North Texas Tollway Authority, Refunding RB, Toll Second
Tier, Series F, 6.13%, 1/01/31

 

 

4,425

 

 

4,869,535

 

Red River Health Facilities Development Corp., First MRB,
Eden Home Inc. Project, 7.25%, 12/15/42

 

 

2,895

 

 

2,919,579

 

Tarrant County Cultural Education Facilities Finance
Corp., RB, Series A:

 

 

 

 

 

 

 

CC Young Memorial Home, 8.00%, 2/15/38

 

 

1,745

 

 

1,830,034

 

Senior Living Center Project, 8.25%, 11/15/44

 

 

4,200

 

 

4,453,008

 

Texas Private Activity Bond Surface Transportation Corp.,
RB, Senior Lien:

 

 

 

 

 

 

 

LBJ Infrastructure Group LLC, LBJ Freeway Managed
Lanes Project, 7.00%, 6/30/40

 

 

4,455

 

 

5,182,323

 

NTE Mobility Partners LLC, North Tarrant Express
Managed Lanes Project, 6.88%, 12/31/39

 

 

3,000

 

 

3,440,670

 

Texas State Public Finance Authority, RB, Charter School
Finance Corp., Series A, 5.38%, 2/15/37

 

 

1,000

 

 

1,016,090

 

 

 

 

 

 

 

59,874,295

 

Vermont — 0.3%

 

 

 

 

 

 

 

Vermont EDA, Refunding MRB, Wake Robin Corp. Project,
Series A (ACA), 6.30%, 3/01/33

 

 

1,600

 

 

1,599,808

 

Virginia — 3.6%

 

 

 

 

 

 

 

Dulles Town Center Community Development Authority,
Special Assessment Bonds, Dulles Town Center Project,
6.25%, 3/01/26

 

 

3,515

 

 

3,517,390

 

Fairfax County EDA, Refunding RB, Goodwin House Inc.,
5.13%, 10/01/42

 

 

2,500

 

 

2,520,475

 

Lexington IDA, Refunding MRB, Kendal at Lexington,
Series A, 5.38%, 1/01/28

 

 

40

 

 

39,311

 

Mosaic District Community Development Authority, RB,
Special Assessment, Series A:

 

 

 

 

 

 

 

6.63%, 3/01/26

 

 

1,485

 

 

1,617,893

 

6.88%, 3/01/36

 

 

1,300

 

 

1,415,102

 

Virginia Small Business Financing Authority, RB, AMT,
Senior Lien, Elizabeth River Crossing Project:

 

 

 

 

 

 

 

5.25%, 1/01/32

 

 

810

 

 

831,781

 

6.00%, 1/01/37

 

 

5,705

 

 

6,197,684

 

5.50%, 1/01/42

 

 

1,175

 

 

1,208,840

 

 

 

 

 

 

 

17,348,476

 

Washington — 0.3%

 

 

 

 

 

 

 

King County, Washington Public Hospital District No. 4,
GO, Refunding, Snoqualmie Valley Hospital, 7.00%,
12/01/40

 

 

1,455

 

 

1,527,343

 

Wisconsin — 1.1%

 

 

 

 

 

 

 

Wisconsin Health & Educational Facilities Authority, RB:

 

 

 

 

 

 

 

New Castle Place Project, Series A, 7.00%, 12/01/31

 

 

3,175

 

 

2,294,477

 

Wheaton Franciscan Healthcare, 5.25%, 8/15/34

 

 

1,625

 

 

1,681,583

 

Wisconsin Health & Educational Facilities Authority,
Refunding RB, St. John’s Communities Inc., Series A:

 

 

 

 

 

 

 

7.25%, 9/15/29

 

 

425

 

 

470,076

 

7.63%, 9/15/39

 

 

855

 

 

955,351

 

 

 

 

 

 

 

5,401,487

 

Total Municipal Bonds — 86.3%

 

 

 

 

 

415,589,710

 


 

 

 

See Notes to Financial Statements.

 

 

 

16

ANNUAL REPORT

APRIL 30, 2012




 

 

 

 

Schedule of Investments (continued)

BlackRock MuniAssets Fund, Inc. (MUA)

(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds Transferred to
Tender Option Bond Trusts (h)

 

Par
(000)

 

Value

 

Colorado — 2.5%

 

 

 

 

 

 

 

Colorado Health Facilities Authority, Refunding RB,
Sisters of Leavenworth, Series A, 5.00%, 1/01/40

 

$

11,475

 

$

12,063,323

 

District of Columbia — 1.7%

 

 

 

 

 

 

 

District of Columbia Water & Sewer Authority, RB,
Series A, 6.00%, 10/01/35

 

 

6,681

 

 

8,278,414

 

Florida — 3.3%

 

 

 

 

 

 

 

County of Miami-Dade Florida, RB, Miami International
Airport, Series A, AMT (AGC), 5.25%, 10/01/33

 

 

15,000

 

 

15,765,750

 

Illinois — 3.1%

 

 

 

 

 

 

 

City of Chicago Illinois, RB, General Airport, Third Lien,
Series A (NPFGC), 5.00%, 1/01/33

 

 

6,510

 

 

6,720,794

 

Illinois Finance Authority, RB, Carle Foundation, Series A
(AGM), 6.00%, 8/15/41

 

 

7,180

 

 

8,088,772

 

 

 

 

 

 

 

14,809,566

 

New York — 11.6%

 

 

 

 

 

 

 

Hudson Yards Infrastructure Corp., RB, Series A, 5.75%,
2/15/47

 

 

4,520

 

 

5,100,687

 

New York City Municipal Water & Sewer Finance Authority,
RB, Second General Resolution:

 

 

 

 

 

 

 

Series EE, 5.50%, 6/15/43

 

 

7,605

 

 

8,759,211

 

Series HH, 5.00%, 6/15/31

 

 

8,609

 

 

9,885,270

 

New York Liberty Development Corp., RB, 1 World Trade
Center Port Authority Construction, 5.25%, 12/15/43

 

 

18,105

 

 

20,343,683

 

New York Liberty Development Corp., Refunding RB, 4
World Trade Center Project, 5.75%, 11/15/51

 

 

6,600

 

 

7,491,726

 

New York State Dormitory Authority, ERB, Series F,
5.00%, 3/15/35

 

 

4,004

 

 

4,340,674

 

 

 

 

 

 

 

55,921,251

 

Washington — 1.8%

 

 

 

 

 

 

 

Bellingham, Washington, Water & Sewer, RB, 5.00%,
8/01/40

 

 

7,966

 

 

8,804,013

 

Total Municipal Bonds Transferred to
Tender Option Bond Trusts — 24.0%

 

 

 

 

 

115,642,317

 

Total Long-Term Investments
(Cost — $511,888,916) — 110.3%

 

 

 

 

 

531,232,027

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Short-Term Securities

 

Shares

 

 

 

 

FFI Institutional Tax-Exempt Fund, 0.09% (i)(j)

 

 

3,404,970

 

 

3,404,970

 

Total Short-Term Securities
(Cost — $3,404,970) — 0.7%

 

 

 

 

 

3,404,970

 

Total Investments (Cost — $515,293,886) — 111.0%

 

 

 

 

 

534,636,997

 

Other Assets Less Liabilities — 1.8%

 

 

 

 

 

8,499,502

 

Liability for TOB Trust Certificates, Including

 

 

 

 

 

 

 

Interest Expense and Fees Payable — (12.8)%

 

 

 

 

 

(61,538,901

)

Net Assets — 100.0%

 

 

 

 

$

481,597,598

 


 

 

 

 

(a)

US government securities, held in escrow, are used to pay interest on this security, as well as to retire the bond in full at the date indicated, typically at a premium to par.

 

 

(b)

Represents a zero-coupon bond. Rate shown reflects the current yield as of report date.

 

 

(c)

When-issued security. Unsettled when-issued transactions were as follows:


 

 

 

 

 

 

 

 

Counterparty

 

Value

 

Unrealized
Appreciation

 

Morgan Stanley & Co., Inc.

 

$

3,778,868

 

$

40,651

 

Stone & Youngberg LLC

 

$

2,396,025

 

$

48,159

 


 

 

(d)

Issuer filed for bankruptcy and/or is in default of interest payments.

 

 

(e)

Non-income producing security.

 

 

(f)

Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933. These securities may be resold in transactions exempt from registration to qualified institutional investors.

 

 

(g)

Variable rate security. Rate shown is as of report date.

 

 

(h)

Securities represent bonds transferred to a TOB in exchange for which the Fund acquired residual interest certificates. These securities serve as collateral in a financing transaction. See Note 1 of the Notes to Financial Statements for details of municipal bonds transferred to TOBs.

 

 

(i)

Investments in companies considered to be an affiliate of the Fund during the year, for purposes of Section 2(a)(3) of the 1940 Act, as amended, were as follows:


 

 

 

 

 

 

 

 

 

 

 

 

 

 

Affiliate

 

Shares
Held at
April 30,
2011

 

Net
Activity

 

Shares
Held at
April 30,
2012

 

Income

 

FFI Institutional Tax-Exempt Fund

 

 

1,560,240

 

 

1,844,730

 

 

3,404,970

 

$

1,157

 


 

 

(j)

Represents the current yield as of report date.

 

 

Financial futures contracts sold as of April 30,2012 were as follows:


 

 

 

 

 

 

 

 

 

 

 

 

 

 

Contracts

 

Issue

 

Exchange

 

Expiration

 

Notional
Value

 

Unrealized
Depreciation

 

280

 

10-Year US

 

Chicago Board

 

June 2012

 

$

37,038,750

 

$

(480,188

)

 

 

Treasury Note

 

of Trade

 

 

 

 

 

 

 

 

 


 

 

Fair Value Measurements — Various inputs are used in determining the fair value of investments and derivative financial instruments. These inputs are categorized into a disclosure hierarchy consisting of three broad levels for financial statement purposes as follows:

 

 

Level 1 — unadjusted price quotations in active markets/exchanges for identical assets and liabilities

 

 

Level 2 — other observable inputs (including, but not limited to: quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs)

 

 

Level 3 — unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Fund’s own assumptions used in determining the fair value of investments and derivative financial instruments)

Changes in valuation techniques may result in transfers into or out of an assigned level within the disclosure hierarchy. The categorization of a value determined for investments and derivative financial instruments is based on the pricing transparency of the investment and derivative financial instrument and is not necessarily an indication of the risks associated with investing in those securities. For information about the Fund’s policy regarding valuation of investments and derivative financial instruments and other significant accounting policies, please refer to Note 1 of the Notes to Financial Statements.

 

 

 

 

See Notes to Financial Statements.

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

17




 

 

 

 

Schedule of Investments (concluded)

BlackRock MuniAssets Fund, Inc. (MUA)

The following tables summarize the inputs used as of April 30, 2012 in determining the fair valuation of the Fund’s investments and derivative financial instruments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Valuation Inputs

 

Level 1

 

Level 2

 

Level 3

 

Total

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

Investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

Long-Term
Investments1

 

 

 

$

531,232,027

 

 

 

$

531,232,027

 

Short-Term
Securities

 

$

3,404,970

 

 

 

 

 

 

3,404,970

 

Total

 

$

3,404,970

 

$

531,232,027

 

 

 

$

534,636,997

 


 

 

 

 

1

See above Schedule of Investments for values in each state or political subdivision.


 

 

 

 

 

 

 

 

 

 

 

 

 

 

Valuation Inputs

 

Level 1

 

Level 2

 

Level 3

 

Total

 

Derivative Financial
Instruments2

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest rate
contracts

 

$

(480,188

)

 

 

 

 

$

(480,188

)


 

 

 

 

2

Derivative financial instruments are financial futures contracts, which are valued at the unrealized appreciation/depreciation on the instrument.


 

 

 

See Notes to Financial Statements.

 

 

 

18

ANNUAL REPORT

APRIL 30, 2012




 

 

 

 

Schedule of Investments April 30, 2012

BlackRock MuniEnhanced Fund, Inc. (MEN)

 

(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Alabama — 1.4%

 

 

 

 

 

 

 

County of Jefferson Alabama, RB, Series A:

 

 

 

 

 

 

 

5.50%, 1/01/22

 

$

2,750

 

$

2,735,535

 

4.75%, 1/01/25

 

 

2,200

 

 

2,035,550

 

 

 

 

 

 

 

4,771,085

 

Alaska — 0.8%

 

 

 

 

 

 

 

Alaska Housing Finance Corp., RB, General Housing,
Series B (NPFGC), 5.25%, 12/01/30

 

 

400

 

 

414,956

 

Alaska Industrial Development & Export Authority,
RB, Providence Health Services, Series A, 5.50%,
10/01/41

 

 

990

 

 

1,112,176

 

Borough of Matanuska-Susitna Alaska, RB, Goose Creek
Correctional Center (AGC), 6.00%, 9/01/28

 

 

1,200

 

 

1,433,676

 

 

 

 

 

 

 

2,960,808

 

Arizona — 1.5%

 

 

 

 

 

 

 

Greater Arizona Development Authority, RB, Series B
(NPFGC), 5.00%, 8/01/35

 

 

1,300

 

 

1,375,608

 

State of Arizona, COP, Department of Administration,
Series A (AGM):

 

 

 

 

 

 

 

5.00%, 10/01/27

 

 

3,250

 

 

3,625,602

 

5.00%, 10/01/29

 

 

400

 

 

434,812

 

 

 

 

 

 

 

5,436,022

 

California — 19.9%

 

 

 

 

 

 

 

Alameda Corridor Transportation Authority, Refunding RB,
CAB, Subordinate Lien, Series A (AMBAC) (a):

 

 

 

 

 

 

 

5.40%, 10/01/24

 

 

10,185

 

 

10,145,584

 

5.45%, 10/01/25

 

 

6,000

 

 

5,944,320

 

Anaheim Public Financing Authority California, RB, Senior,
Public Improvements Project, Series A (AGM), 6.00%,
9/01/24

 

 

5,000

 

 

6,175,600

 

Cabrillo Community College District, GO, CAB, Election of
2004, Series B (NPFGC), 5.18%, 8/01/37 (b)

 

 

2,400

 

 

595,560

 

California Health Facilities Financing Authority,
Refunding RB:

 

 

 

 

 

 

 

St. Joseph Health System, Series A, 5.75%, 7/01/39

 

 

550

 

 

622,622

 

Sutter Health, Series B, 5.88%, 8/15/31

 

 

1,200

 

 

1,426,320

 

California State University, RB, Systemwide, Series A
(NPFGC), 5.00%, 11/01/35

 

 

1,405

 

 

1,451,660

 

California State University, Refunding RB, Systemwide,
Series A (AGM), 5.00%, 11/01/37

 

 

2,000

 

 

2,179,600

 

California Statewide Communities Development Authority,
RB, Series A, 5.00%, 4/01/42

 

 

1,480

 

 

1,578,908

 

City of Redding California, COP, Refunding, Series A
(AGM), 5.00%, 6/01/30

 

 

1,420

 

 

1,559,472

 

City of San Jose California, RB, Series A-1, AMT, 5.75%,
3/01/34

 

 

850

 

 

942,395

 

Los Angeles Community College District California, GO,
Election of 2001, Series A (AGM), 5.00%, 8/01/32

 

 

1,300

 

 

1,459,848

 

Los Angeles Department of Water & Power, RB, Series C
(NPFGC), 5.00%, 7/01/29

 

 

5,160

 

 

5,514,801

 

Metropolitan Water District of Southern California, RB,
Series B-1 (NPFGC) (c):

 

 

 

 

 

 

 

5.00%, 10/01/13

 

 

2,570

 

 

2,741,342

 

5.00%, 10/01/13

 

 

1,480

 

 

1,578,672

 

Orange County Sanitation District, COP, Series B (AGM):

 

 

 

 

 

 

 

5.00%, 2/01/30

 

 

1,500

 

 

1,668,495

 

5.00%, 2/01/31

 

 

900

 

 

1,000,197

 

Poway Unified School District, GO, CAB, School Facilities
Improvement, Election of 2007, 6.27%, 8/01/36 (b)

 

 

3,750

 

 

1,057,012

 

Rio Hondo Community College District California, GO,
CAB, Election of 2004, Series C, 6.18%, 8/01/38 (b)

 

 

5,000

 

 

1,268,950

 

 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

California (concluded)

 

 

 

 

 

 

 

San Diego Unified School District California,
GO, CAB (b):

 

 

 

 

 

 

 

Election of 2008, Series C, 6.84%, 7/01/38

 

$

1,600

 

$

396,768

 

Series R-1, 5.07%, 7/01/30

 

 

5,000

 

 

2,028,250

 

Series R-1, 5.08%, 7/01/31

 

 

1,280

 

 

490,765

 

San Joaquin County Transportation Authority, RB,
Limited Tax, Measure K, Series A, 6.00%, 3/01/36

 

 

2,175

 

 

2,608,891

 

San Marcos Unified School District, GO, Election of
2010, Series A:

 

 

 

 

 

 

 

5.00%, 8/01/34

 

 

700

 

 

768,985

 

5.00%, 8/01/38

 

 

600

 

 

650,820

 

San Mateo County Community College District, GO,
CAB, Election of 2001, Series C (NPFGC), 5.54%,
9/01/30 (b)

 

 

12,740

 

 

5,480,366

 

State of California, GO:

 

 

 

 

 

 

 

5.13%, 6/01/27

 

 

20

 

 

20,064

 

5.13%, 6/01/31

 

 

60

 

 

60,175

 

5.00%, 10/01/41

 

 

1,000

 

 

1,064,880

 

Tamalpais Union High School District, GO, 5.00%,
8/01/13 (c)

 

 

1,600

 

 

1,694,016

 

Walnut Valley Unified School District, GO, CAB, Election
of 2007, Series B, 6.90%, 8/01/36 (b)

 

 

5,500

 

 

1,558,040

 

West Basin Municipal Water District California, COP,
Refunding, Series B (AGC), 5.00%, 8/01/30

 

 

5,035

 

 

5,417,509

 

 

 

 

 

 

 

71,150,887

 

Colorado — 1.0%

 

 

 

 

 

 

 

Colorado Health Facilities Authority, RB, Covenant
Retirement Communities, Series A (Radian), 5.50%,
12/01/27

 

 

1,200

 

 

1,207,920

 

Colorado Housing & Finance Authority, Refunding
RB, S/F Program, Senior Series A-2, AMT, 7.50%,
4/01/31

 

 

250

 

 

251,472

 

Regional Transportation District, COP, Series A, 5.38%,
6/01/31

 

 

2,000

 

 

2,224,820

 

 

 

 

 

 

 

3,684,212

 

District of Columbia — 1.6%

 

 

 

 

 

 

 

District of Columbia, RB, Series B-1 (NPFGC), 5.00%,
2/01/31

 

 

5,480

 

 

5,554,364

 

Florida — 13.3%

 

 

 

 

 

 

 

Broward County School Board Florida, COP, Series A
(AGM), 5.25%, 7/01/33

 

 

1,600

 

 

1,718,240

 

Broward County Water & Sewer Utility, RB, Series A,
5.25%, 10/01/34

 

 

850

 

 

964,087

 

City of Jacksonville, Refunding RB, Series A, 5.00%,
10/01/30

 

 

280

 

 

310,716

 

Collier County School Board, COP (AGM), 5.00%,
2/15/23

 

 

3,000

 

 

3,384,240

 

County of Duval Florida, COP, Master Lease Program
(AGM), 5.00%, 7/01/33

 

 

3,000

 

 

3,165,930

 

County of Lee Florida, Refunding ARB, Series A, AMT:

 

 

 

 

 

 

 

5.63%, 10/01/26

 

 

960

 

 

1,066,627

 

5.38%, 10/01/32

 

 

3,160

 

 

3,382,717

 

County of Miami-Dade Florida, GO, Building Better
Communities Program, Series B-1, 5.75%, 7/01/33

 

 

1,400

 

 

1,594,166

 

County of Miami-Dade Florida, RB, Water & Sewer
System (AGM), 5.00%, 10/01/39

 

 

4,625

 

 

5,007,719

 

County of Miami-Dade Florida, Refunding RB, Miami
International Airport, AMT (AGC), 5.00%, 10/01/40

 

 

9,900

 

 

10,121,067

 

Florida Ports Financing Commission, Refunding RB,
State Transportation Trust Fund, Series B, AMT:

 

 

 

 

 

 

 

5.13%, 6/01/27

 

 

2,000

 

 

2,227,960

 

5.38%, 10/01/29

 

 

1,050

 

 

1,171,076

 

Highlands County Health Facilities Authority, RB,
Adventist Health System/Sunbelt, Series B,
6.00%, 11/15/37

 

 

1,450

 

 

1,665,644

 


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

19




 

 

 

 

Schedule of Investments (continued)

BlackRock MuniEnhanced Fund, Inc. (MEN)

 

(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Florida (concluded)

 

 

 

 

 

 

 

Hillsborough County Aviation Authority Florida, RB,
Series A, AMT (AGC), 5.38%, 10/01/33

 

$

4,050

 

$

4,294,134

 

Orange County School Board, COP, Series A:

 

 

 

 

 

 

 

(AGC), 5.50%, 8/01/34

 

 

3,550

 

 

3,924,489

 

(NPFGC), 5.00%, 8/01/31

 

 

2,000

 

 

2,101,340

 

Sarasota County Public Hospital District, RB, Sarasota
Memorial Hospital Project, Series A, 5.63%, 7/01/39

 

 

275

 

 

295,328

 

South Florida Water Management District, COP (AGC),
5.00%, 10/01/22

 

 

1,000

 

 

1,146,110

 

 

 

 

 

 

 

47,541,590

 

Georgia — 3.4%

 

 

 

 

 

 

 

Burke County Development Authority, RB, Oglethorpe
Power-Vogtle Project, Series C, 5.70%, 1/01/43

 

 

1,150

 

 

1,235,066

 

Gwinnett County Hospital Authority, Refunding RB,
Gwinnett Hospital System, Series D (AGM), 5.50%,
7/01/41

 

 

395

 

 

433,655

 

Municipal Electric Authority of Georgia, Refunding RB,
Series EE (AMBAC), 7.00%, 1/01/25

 

 

7,475

 

 

10,433,156

 

 

 

 

 

 

 

12,101,877

 

Illinois — 20.4%

 

 

 

 

 

 

 

Chicago Illinois Transit Authority, RB, Sales Tax Receipts,
5.25%, 12/01/36

 

 

595

 

 

662,741

 

Chicago O’Hare International Airport, GARB, Third Lien:

 

 

 

 

 

 

 

Series A, 5.75%, 1/01/39

 

 

5,110

 

 

5,852,023

 

Series B-2, AMT (AGM), 5.75%, 1/01/23

 

 

5,670

 

 

5,985,479

 

Series B-2, AMT (Syncora), 6.00%, 1/01/29

 

 

2,500

 

 

2,659,900

 

Chicago O’Hare International Airport, Refunding GARB,
Third Lien, Series A, AMT (NPFGC), 5.75%, 1/01/21

 

 

4,500

 

 

4,513,815

 

Chicago Park District, GO, Unlimited Tax, Harbor Facilities
Revenues, Series C, 5.25%, 1/01/40

 

 

550

 

 

603,295

 

City of Chicago Illinois, Board of Education, GO, Series A:

 

 

 

 

 

 

 

(AGM), 5.50%, 12/01/31

 

 

2,875

 

 

3,545,766

 

Refunding, Chicago School Reform Board (NPFGC),
5.50%, 12/01/26

 

 

725

 

 

875,902

 

Refunding, Unlimited Tax, 5.50%, 12/01/39

 

 

2,375

 

 

2,684,534

 

County of Cook Illinois, GO, Capital Improvement,
Series C (AMBAC), 5.50%, 11/15/12 (c)

 

 

2,460

 

 

2,530,405

 

Illinois Finance Authority, RB, Carle Foundation, Series A:

 

 

 

 

 

 

 

5.75%, 8/15/34

 

 

650

 

 

702,377

 

6.00%, 8/15/41

 

 

1,000

 

 

1,100,040

 

Illinois HDA, RB, Liberty Arms Senior Apartments,
Series D, AMT (AMBAC), 4.88%, 7/01/47

 

 

2,200

 

 

2,200,814

 

Illinois Municipal Electric Agency, RB, Series A (NPFGC),
5.25%, 2/01/35

 

 

1,000

 

 

1,075,960

 

Illinois Sports Facilities Authority, RB, State Tax Supported
(AMBAC), 5.50%, 6/15/30

 

 

17,620

 

 

19,311,696

 

Metropolitan Pier & Exposition Authority, RB, CAB,
McCormick Place Expansion Project, Series A
(NPFGC) (b):

 

 

 

 

 

 

 

5.16%, 12/15/26

 

 

5,000

 

 

2,596,900

 

5.96%, 12/15/33

 

 

9,950

 

 

3,355,637

 

Metropolitan Pier & Exposition Authority, Refunding RB,
CAB, McCormick Place Expansion Project, Series B
(AGM), 6.25%, 6/15/44 (b)

 

 

3,450

 

 

613,238

 

Railsplitter Tobacco Settlement Authority, RB, 6.00%,
6/01/28

 

 

675

 

 

765,963

 

Regional Transportation Authority, RB, Series A (AMBAC),
7.20%, 11/01/20

 

 

8,800

 

 

10,657,152

 

State of Illinois, GO:

 

 

 

 

 

 

 

5.00%, 3/01/36

 

 

355

 

 

373,286

 

5.00%, 3/01/37

 

 

140

 

 

146,868

 

 

 

 

 

 

 

72,813,791

 


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Indiana — 1.2%

 

 

 

 

 

 

 

Indiana Finance Authority, RB, First Lien, CWA Authority
Project, Series A, 5.25%, 10/01/38

 

$

1,100

 

$

1,226,192

 

Indiana Municipal Power Agency, RB, Series B, 5.75%,
1/01/34

 

 

400

 

 

425,244

 

Indianapolis Local Public Improvement Bond Bank,
Refunding RB, Waterworks Project, Series A (AGC):

 

 

 

 

 

 

 

5.25%, 1/01/29

 

 

600

 

 

667,602

 

5.50%, 1/01/38

 

 

1,825

 

 

2,032,302

 

 

 

 

 

 

 

4,351,340

 

Iowa — 4.1%

 

 

 

 

 

 

 

Iowa Finance Authority, RB, Series A (AGC), 5.63%,
8/15/37

 

 

5,725

 

 

6,277,634

 

Iowa Student Loan Liquidity Corp., RB, Series A-2, AMT:

 

 

 

 

 

 

 

5.60%, 12/01/26

 

 

3,670

 

 

4,044,157

 

5.70%, 12/01/27

 

 

1,670

 

 

1,840,657

 

5.80%, 12/01/29

 

 

1,125

 

 

1,236,409

 

5.85%, 12/01/30

 

 

1,170

 

 

1,283,244

 

 

 

 

 

 

 

14,682,101

 

Louisiana — 1.3%

 

 

 

 

 

 

 

Louisiana Public Facilities Authority, Refunding RB,
Christus Health, Series B (AGC), 6.50%, 7/01/30

 

 

1,250

 

 

1,459,125

 

Parish of Saint John the Baptist Louisiana, RB,
Marathon Oil Corp., Series A, 5.13%, 6/01/37

 

 

3,150

 

 

3,263,967

 

 

 

 

 

 

 

4,723,092

 

Massachusetts — 1.3%

 

 

 

 

 

 

 

Massachusetts HFA, Refunding RB, AMT:

 

 

 

 

 

 

 

Rental Housing, Series A (AGM), 5.15%, 7/01/26

 

 

510

 

 

517,018

 

Series C, 5.35%, 12/01/42

 

 

1,150

 

 

1,212,962

 

Massachusetts Water Resources Authority, Refunding
RB, General, Series A (NPFGC), 5.00%, 8/01/34

 

 

2,700

 

 

3,005,991

 

 

 

 

 

 

 

4,735,971

 

Michigan — 5.9%

 

 

 

 

 

 

 

City of Detroit Michigan, RB, Series B (AGM):

 

 

 

 

 

 

 

Second Lien, 6.25%, 7/01/36

 

 

400

 

 

458,812

 

Second Lien, 7.00%, 7/01/36

 

 

200

 

 

239,128

 

Senior Lien, 7.50%, 7/01/33

 

 

500

 

 

626,530

 

City of Detroit Michigan, Refunding RB, Second Lien,
Series E (BHAC), 5.75%, 7/01/31

 

 

2,500

 

 

2,818,425

 

Kalamazoo Hospital Finance Authority, RB, Bronson
Methodist Hospital (AGM), 5.25%, 5/15/36

 

 

75

 

 

81,070

 

Lansing Board of Water & Light Utilities, RB, Series A,
5.50%, 7/01/41

 

 

1,700

 

 

1,964,639

 

Michigan Higher Education Student Loan Authority,
Refunding RB, Student Loan, Series XVII-G, AMT
(AMBAC), 5.20%, 9/01/20

 

 

1,500

 

 

1,507,530

 

Michigan State Building Authority, Refunding RB,
Facilities Program:

 

 

 

 

 

 

 

Series I-A, 5.38%, 10/15/36

 

 

145

 

 

163,123

 

Series I-A, 5.38%, 10/15/41

 

 

700

 

 

783,356

 

Series II-A (AGM), 5.25%, 10/15/36

 

 

900

 

 

1,006,650

 

Michigan State Finance Authority, Refunding RB, Trinity
Health, 5.00%, 12/01/39

 

 

4,300

 

 

4,625,252

 

Michigan State HDA, RB, Series C, AMT, 5.50%,
12/01/28

 

 

1,100

 

 

1,160,852

 

Michigan Strategic Fund, Refunding RB, Detroit Edison
Co. Project, AMT (Syncora):

 

 

 

 

 

 

 

Series A, 5.50%, 6/01/30

 

 

1,300

 

 

1,317,043

 

Series C, 5.45%, 12/15/32

 

 

4,300

 

 

4,320,210

 

 

 

 

 

 

 

21,072,620

 


 

 

 

See Notes to Financial Statements.

 

 

 

20

ANNUAL REPORT

APRIL 30, 2012




 

 

 

 

Schedule of Investments (continued)

BlackRock MuniEnhanced Fund, Inc. (MEN)

 

(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Minnesota — 0.8%

 

 

 

 

 

 

 

City of Minneapolis Minnesota, Refunding RB, Fairview
Health Services, Series B (AGC), 6.50%, 11/15/38

 

$

2,500

 

$

2,941,475

 

Mississippi — 0.2%

 

 

 

 

 

 

 

Medical Center Educational Building Corporation
Project, RB, University of Mississippi Medical Center
Facilities, Expansion & Renovation Project, Series A,
5.00%, 6/01/41

 

 

740

 

 

809,257

 

Nebraska — 0.2%

 

 

 

 

 

 

 

Central Plains Energy Project, RB, Gas Project No. 3,
5.25%, 9/01/37

 

 

750

 

 

779,700

 

Nevada — 3.1%

 

 

 

 

 

 

 

City of Carson City Nevada, RB, Carson-Tahoe Hospital
Project, Series A (Radian), 5.50%, 9/01/33

 

 

1,250

 

 

1,282,000

 

City of Las Vegas Nevada, GO, Limited Tax, Performing
Arts Center, 6.00%, 4/01/34

 

 

850

 

 

984,648

 

County of Clark Nevada, RB:

 

 

 

 

 

 

 

Las Vegas-McCarran International Airport, Series A
(AGC), 5.25%, 7/01/39

 

 

3,800

 

 

4,131,778

 

Southwest Gas Corp. Project, Series A, AMT (NPFGC),
4.75%, 9/01/36

 

 

75

 

 

72,527

 

Subordinate Lien, Series A-2 (NPFGC), 5.00%,
7/01/30

 

 

1,000

 

 

1,060,720

 

Subordinate Lien, Series A-2 (NPFGC), 5.00%,
7/01/36

 

 

3,200

 

 

3,328,160

 

 

 

 

 

 

 

10,859,833

 

New Jersey — 6.8%

 

 

 

 

 

 

 

New Jersey EDA, RB:

 

 

 

 

 

 

 

Cigarette Tax (Radian), 5.50%, 6/15/14 (c)

 

 

600

 

 

664,734

 

Cigarette Tax (Radian), 5.75%, 6/15/14 (c)

 

 

305

 

 

339,520

 

Motor Vehicle Surcharge, Series A (NPFGC),
5.25%, 7/01/31

 

 

3,125

 

 

3,357,812

 

Motor Vehicle Surcharge, Series A (NPFGC),
5.25%, 7/01/33

 

 

7,800

 

 

8,381,100

 

School Facilities Construction, Series Z (AGC),
6.00%, 12/15/34

 

 

2,000

 

 

2,293,280

 

New Jersey Higher Education Student Assistance
Authority, RB, Series 1, AMT:

 

 

 

 

 

 

 

5.50%, 12/01/26

 

 

600

 

 

665,658

 

5.75%, 12/01/27

 

 

3,870

 

 

4,339,857

 

New Jersey Transportation Trust Fund Authority, RB,
Transportation System:

 

 

 

 

 

 

 

Series A, 5.50%, 6/15/41

 

 

2,000

 

 

2,279,880

 

Series B, 5.25%, 6/15/36

 

 

1,825

 

 

2,039,292

 

 

 

 

 

 

 

24,361,133

 

New York — 4.7%

 

 

 

 

 

 

 

Erie County Industrial Development Agency, RB, City
School District of Buffalo Project, Series A (AGM),
5.75%, 5/01/28

 

 

1,500

 

 

1,747,095

 

Hudson New York Yards Infrastructure Corp., RB, Series A,
5.75%, 2/15/47

 

 

700

 

 

789,999

 

Metropolitan Transportation Authority, RB, Series 2008C,
6.50%, 11/15/28

 

 

4,000

 

 

5,070,480

 

New York City Transitional Finance Authority, RB,
Fiscal 2009, Series S-4:

 

 

 

 

 

 

 

5.50%, 1/15/33

 

 

1,600

 

 

1,832,976

 

5.50%, 1/15/34

 

 

2,750

 

 

3,136,127

 

New York HFA, RB, Affordable Housing, Series B, 5.30%,
11/01/37

 

 

2,500

 

 

2,591,600

 

New York State Dormitory Authority, ERB, Series B, 5.75%,
3/15/36

 

 

1,200

 

 

1,401,156

 

 

 

 

 

 

 

16,569,433

 

 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

North Carolina — 0.3%

 

 

 

 

 

 

 

North Carolina Medical Care Commission, RB, Novant
Health Obligation, Series A, 4.75%, 11/01/43

 

$

850

 

$

875,169

 

Ohio — 0.6%

 

 

 

 

 

 

 

County of Allen Ohio, Refunding RB, Hospital Facilities,
Catholic Health Partners, Series A,
5.00%, 5/01/42 (d)

 

 

750

 

 

797,962

 

County of Lucas Ohio, Refunding RB, Promedica
Healthcare, Series A, 6.50%, 11/15/37

 

 

530

 

 

645,996

 

Ohio Higher Educational Facility Commission,
Refunding RB, Summa Health System, 2010 Project
(AGC), 5.25%, 11/15/40

 

 

650

 

 

694,922

 

 

 

 

 

 

 

2,138,880

 

Pennsylvania — 0.8%

 

 

 

 

 

 

 

Pennsylvania HFA, Refunding RB, Series 99A, AMT,
5.25%, 10/01/32

 

 

1,500

 

 

1,548,210

 

Pennsylvania Turnpike Commission, RB, Subordinate,
Special Motor License Fund, 6.00%, 12/01/36

 

 

575

 

 

693,105

 

Philadelphia School District, GO, Series E, 6.00%,
9/01/38

 

 

400

 

 

453,448

 

 

 

 

 

 

 

2,694,763

 

Puerto Rico — 3.5%

 

 

 

 

 

 

 

Puerto Rico Electric Power Authority, Refunding RB,
Series A, 5.00%, 7/01/42 (d)

 

 

1,420

 

 

1,417,699

 

Puerto Rico Sales Tax Financing Corp., RB:

 

 

 

 

 

 

 

CAB, Series C, 6.04%, 8/01/38 (b)

 

 

8,000

 

 

1,881,440

 

First Sub-Series A, 6.38%, 8/01/39

 

 

3,200

 

 

3,722,240

 

First Sub-Series A, 6.00%, 8/01/42

 

 

2,275

 

 

2,566,473

 

Puerto Rico Sales Tax Financing Corp., Refunding RB:

 

 

 

 

 

 

 

CAB, Series A (NPFGC), 5.68%, 8/01/41

 

 

8,500

 

 

1,632,765

 

First Sub-Series C, 6.00%, 8/01/39

 

 

1,180

 

 

1,348,870

 

 

 

 

 

 

 

12,569,487

 

Rhode Island — 0.7%

 

 

 

 

 

 

 

Rhode Island Health & Educational Building Corp.,
Refunding RB, Public Schools Financing Program,
Series E (AGC), 6.00%, 5/15/29

 

 

2,275

 

 

2,577,143

 

South Carolina — 1.3%

 

 

 

 

 

 

 

South Carolina Jobs-EDA, Refunding RB, Palmetto
Health, Series A (AGM), 6.50%, 8/01/39

 

 

115

 

 

134,904

 

South Carolina State Public Service Authority, RB,
Santee Cooper, Series A, 5.50%, 1/01/38

 

 

1,000

 

 

1,126,230

 

South Carolina Transportation Infrastructure Bank, RB,
Series A, 5.25%, 10/01/40

 

 

3,000

 

 

3,276,840

 

 

 

 

 

 

 

4,537,974

 

Tennessee — 2.6%

 

 

 

 

 

 

 

Memphis Center City Revenue Finance Corp., RB,
Subordinate, Pyramid & Pinch District, Series B,
(AGM), 5.25%, 11/01/30

 

 

2,955

 

 

3,377,683

 

Metropolitan Government of Nashville & Davidson
County Health & Educational Facilities Board,
Refunding RB, Vanderbilt University, Series B,
5.50%, 10/01/29

 

 

5,000

 

 

5,946,600

 

 

 

 

 

 

 

9,324,283

 

Texas — 10.1%

 

 

 

 

 

 

 

City of Houston Texas, Refunding RB, Combined,
First Lien, Series A (AGC):

 

 

 

 

 

 

 

6.00%, 11/15/35

 

 

2,100

 

 

2,514,876

 

5.38%, 11/15/38

 

 

1,350

 

 

1,531,062

 

Dallas-Fort Worth International Airport Facilities
Improvement Corp., RB, Series A (NPFGC), 5.50%,
11/01/33

 

 

13,000

 

 

13,203,840

 

Mansfield ISD Texas, GO, School Building (PSF-GTD),
5.00%, 2/15/33

 

 

1,725

 

 

1,927,636

 


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

21




 

 

 

 

Schedule of Investments (continued)

BlackRock MuniEnhanced Fund, Inc. (MEN)

 

(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Texas (concluded)

 

 

 

 

 

 

 

North Texas Tollway Authority, RB, Series K-2 System,
First Tier, 6.00%, 1/01/38

 

$

4,015

 

$

4,543,454

 

North Texas Tollway Authority, Refunding RB, First Tier:

 

 

 

 

 

 

 

(NPFGC), 5.75%, 1/01/40

 

 

1,600

 

 

1,737,296

 

Series A, 6.00%, 1/01/28

 

 

2,795

 

 

3,214,446

 

Series K-1 System, 5.75%, 1/01/38

 

 

3,800

 

 

4,239,812

 

Texas State Turnpike Authority, RB, First Tier, Series A
(AMBAC), 5.50%, 8/15/39

 

 

3,150

 

 

3,163,482

 

 

 

 

 

 

 

36,075,904

 

Washington — 1.8%

 

 

 

 

 

 

 

Central Puget Sound Regional Transit Authority, RB,
Series A, 5.00%, 11/01/36

 

 

1,600

 

 

1,750,688

 

Washington Health Care Facilities Authority, RB,
Providence Health & Services, Series A:

 

 

 

 

 

 

 

5.00%, 10/01/39

 

 

900

 

 

971,316

 

5.25%, 10/01/39

 

 

625

 

 

689,606

 

Washington Health Care Facilities Authority, Refunding
RB, Providence Health & Services, Series D (AGM),
5.25%, 10/01/33

 

 

2,800

 

 

3,033,324

 

 

 

 

 

 

 

6,444,934

 

Wisconsin — 0.4%

 

 

 

 

 

 

 

Wisconsin Health & Educational Facilities Authority, RB,
Ascension Health Senior Credit Group, 5.00%,
11/15/33

 

 

1,375

 

 

1,497,334

 

Total Municipal Bonds — 115.0%

 

 

 

 

 

410,636,462

 

 

 

 

 

 

 

 

 

 

Municipal Bonds Transferred to
Tender Option Bond Trusts (e)

 

 

 

 

 

 

 

Arizona — 0.8%

 

 

 

 

 

 

 

Phoenix Civic Improvement Corp., RB, Junior Lien,
Series A, 5.00%, 7/01/34

 

 

1,200

 

 

1,373,328

 

Salt River Project Agricultural Improvement & Power
District, RB, Series A, 5.00%, 1/01/38

 

 

1,500

 

 

1,626,765

 

 

 

 

 

 

 

3,000,093

 

California — 4.3%

 

 

 

 

 

 

 

Los Angeles Community College District California, GO,
Election of 2001, Series A (AGM), 5.00%, 8/01/32

 

 

2,500

 

 

2,807,400

 

Orange County Sanitation District, COP (NPFGC),
5.00%, 8/01/13 (c)

 

 

7,458

 

 

7,893,620

 

San Diego Community College District California, GO,
Election of 2002, 5.25%, 8/01/33

 

 

404

 

 

463,484

 

San Diego County Water Authority, COP, Refunding,
Series 2008-A (AGM), 5.00%, 5/01/33

 

 

2,810

 

 

3,065,007

 

University of California, RB, Series O, 5.75%, 5/15/34

 

 

840

 

 

974,652

 

 

 

 

 

 

 

15,204,163

 

Colorado — 0.3%

 

 

 

 

 

 

 

Colorado Health Facilities Authority, Refunding RB,
Catholic Health Initiatives, Series A, 5.50%, 7/01/34

 

 

900

 

 

1,006,924

 

District of Columbia — 0.9%

 

 

 

 

 

 

 

District of Columbia, RB, Series A, 5.50%, 12/01/30

 

 

1,005

 

 

1,226,894

 

District of Columbia Water & Sewer Authority, RB,
Series A, 6.00%, 10/01/35

 

 

1,770

 

 

2,193,532

 

 

 

 

 

 

 

3,420,426

 

 

 

 

 

 

 

 

 

Municipal Bonds Transferred to
Tender Option Bond Trusts (e)

 

Par
(000)

 

Value

 

Florida — 6.8%

 

 

 

 

 

 

 

City of Tallahassee Florida Energy System, RB (NPFGC):

 

 

 

 

 

 

 

5.00%, 10/01/32

 

$

4,000

 

$

4,263,240

 

5.00%, 10/01/37

 

 

7,500

 

 

7,982,175

 

Florida State Board of Education, GO, Series D, 5.00%,
6/01/37

 

 

1,349

 

 

1,489,111

 

Miami-Dade County School Board, COP, Refunding,
Series B (AGC), 5.00%, 5/01/33

 

 

10,000

 

 

10,534,400

 

 

 

 

 

 

 

24,268,926

 

Georgia — 5.2%

 

 

 

 

 

 

 

City of Atlanta Georgia, GARB, Series B (AGM), 5.25%,
1/01/33

 

 

17,356

 

 

18,555,340

 

Illinois — 3.6%

 

 

 

 

 

 

 

City of Chicago Illinois, RB:

 

 

 

 

 

 

 

Motor Fuel Tax Revenue (AGC), 5.00%, 1/01/38

 

 

2,000

 

 

2,087,040

 

Sales Tax Revenue, 5.00%, 1/01/41

 

 

3,430

 

 

3,731,325

 

Illinois State Toll Highway Authority, RB, Series B,
5.50%, 1/01/33

 

 

1,880

 

 

2,051,205

 

State of Illinois, RB, Build Illinois Bonds, Series B,
5.25%, 6/15/34

 

 

4,399

 

 

4,839,402

 

 

 

 

 

 

 

12,708,972

 

Louisiana — 1.6%

 

 

 

 

 

 

 

State of Louisiana Gas & Fuels, RB, Series A (AGM),
5.00%, 5/01/36

 

 

5,400

 

 

5,793,822

 

Massachusetts — 3.3%

 

 

 

 

 

 

 

Massachusetts School Building Authority, RB,
Dedicated Sales Tax Revenue, Series A (AGM),
5.00%, 8/15/30

 

 

10,600

 

 

11,725,357

 

Nevada — 3.3%

 

 

 

 

 

 

 

City of Las Vegas Nevada, GO, Limited Tax, Performing
Arts Center, 6.00%, 4/01/39

 

 

3,778

 

 

4,336,325

 

Clark County Water Reclamation District, GO, Series B:

 

 

 

 

 

 

 

5.50%, 7/01/29

 

 

4,499

 

 

5,191,039

 

5.75%, 7/01/34

 

 

1,829

 

 

2,203,080

 

 

 

 

 

 

 

11,730,444

 

New York — 1.6%

 

 

 

 

 

 

 

New York City Municipal Water & Sewer Finance
Authority, RB, Fiscal 2009, Series A, 5.75%, 6/15/40

 

 

1,260

 

 

1,491,410

 

Port Authority of New York & New Jersey, RB,
Construction One Hundred Forty-Third, 5.00%,
10/01/30

 

 

2,500

 

 

2,697,775

 

Triborough Bridge & Tunnel Authority, RB, General,
Series A-2, 5.25%, 11/15/34

 

 

1,300

 

 

1,469,260

 

 

 

 

 

 

 

5,658,445

 

Ohio — 0.2%

 

 

 

 

 

 

 

State of Ohio, RB, Cleveland Clinic Health, Series B,
5.50%, 1/01/34

 

 

580

 

 

646,978

 

Puerto Rico — 0.7%

 

 

 

 

 

 

 

Puerto Rico Sales Tax Financing Corp., Refunding RB,
Series C, 5.25%, 8/01/40

 

 

2,380

 

 

2,604,196

 

South Carolina — 2.5%

 

 

 

 

 

 

 

Charleston Educational Excellence Finance Corp., RB,
Charleston County School (AGC):

 

 

 

 

 

 

 

5.25%, 12/01/28

 

 

3,120

 

 

3,456,492

 

5.25%, 12/01/29

 

 

2,765

 

 

3,058,256

 

5.25%, 12/01/30

 

 

1,010

 

 

1,116,383

 

South Carolina State Public Service Authority, RB,
Santee Cooper, Series A, 5.50%, 1/01/38

 

 

1,275

 

 

1,435,943

 

 

 

 

 

 

 

9,067,074

 


 

 

 

See Notes to Financial Statements.

 

 

 

22

ANNUAL REPORT

APRIL 30, 2012




 

 

 

 

Schedule of Investments (concluded)

BlackRock MuniEnhanced Fund, Inc. (MEN)
(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds Transferred to
Tender Option Bond Trusts (e)

 

Par
(000)

 

Value

 

South Dakota — 0.7%

 

 

 

 

 

 

 

South Dakota HDA, RB, Homeownership Mortgage
Series K, 5.05%, 5/01/36

 

$

2,500

 

$

2,525,550

 

Texas — 1.2%

 

 

 

 

 

 

 

Clear Creek ISD Texas, GO, Refunding, School Building
(PSF-GTD), 5.00%, 2/15/33

 

 

2,200

 

 

2,587,651

 

North East ISD Texas, GO, School Building, Series A
(PSF-GTD), 5.00%, 8/01/37

 

 

1,600

 

 

1,765,824

 

 

 

 

 

 

 

4,353,475

 

Utah — 1.6%

 

 

 

 

 

 

 

Utah Transit Authority, RB, Series A (AGM), 5.00%,
6/15/36

 

 

5,000

 

 

5,578,350

 

Virginia — 0.1%

 

 

 

 

 

 

 

Fairfax County IDA Virginia, Refunding RB, Health Care,
Inova Health System, Series A, 5.50%, 5/15/35

 

 

350

 

 

390,786

 

Washington — 1.3%

 

 

 

 

 

 

 

Central Puget Sound Regional Transit Authority, RB,
Series A (AGM), 5.00%, 11/01/32

 

 

4,004

 

 

4,500,774

 

Wisconsin — 0.4%

 

 

 

 

 

 

 

Wisconsin Health & Educational Facilities Authority,
Refunding RB, Froedtert & Community Health Inc.,
5.25%, 4/01/39

 

 

1,430

 

 

1,553,822

 

Total Municipal Bonds Transferred to
Tender Option Bond Trusts — 40.4%

 

 

 

 

 

144,293,917

 

Total Long-Term Investments
(Cost — $508,744,974) — 155.4%

 

 

 

 

 

554,930,379

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Short-Term Securities

 

 

Shares

 

 

 

 

FFI Institutional Tax-Exempt Fund, 0.09% (f)(g)

 

 

9,127,957

 

 

9,127,957

 

Total Short-Term Securities
(Cost — $9,127,957) — 2.6%

 

 

 

 

 

9,127,957

 

Total Investments (Cost — $517,872,931) — 158.0%

 

 

 

 

 

564,058,336

 

Other Assets Less Liabilities — 1.4%

 

 

 

 

 

4,780,379

 

Liability for TOB Trust Certificates, Including
Interest Expense and Fees Payable — (19.5)%

 

 

 

 

 

(69,321,684

)

VRDP Shares, at Liquidation Value — (39.9)%

 

 

 

 

 

(142,500,000

)

Net Assets Applicable to Common Shares — 100.0%

 

 

 

 

$

357,017,031

 

 

 

 

 

 

 

 

 


 

 

(a)

Represents a step-up bond that pays an initial coupon rate for the first period and then a higher coupon rate for the following periods. Rate shown is as of report date.

 

 

(b)

Represents a zero-coupon bond. Rate shown reflects the current yield as of report date.

 

 

(c)

US government securities, held in escrow, are used to pay interest on this security, as well as to retire the bond in full at the date indicated, typically at a premium to par.

 

 

(d)

When-issued security. Unsettled when-issued transactions were as follows:


 

 

 

 

 

 

 

 

Counterparty

 

Value

 

Unrealized
Appreciation

 

Morgan Stanley & Co., Inc.

 

$

2,215,661

 

$

17,876

 


 

 

(e)

Securities represent bonds transferred to a TOB in exchange for which the Fund acquired residual interest certificates. These securities serve as collateral in a financing transaction. See Note 1 of the Notes to Financial Statements for details of municipal bonds transferred to TOBs.

 

 

(f)

Investments in companies considered to be an affiliate of the Fund during the year, for purposes of Section 2(a)(3) of the 1940 Act, as amended, were as follows:


 

 

 

 

 

 

 

 

 

 

 

 

 

 

Affiliate

 

Shares
Held at
April 30,
2011

 

Net
Activity

 

Shares
Held at
April 30,
2012

 

Income

 

FFI Institutional Tax-Exempt Fund

 

 

3,470,954

 

 

5,657,003

 

 

9,127,957

 

$

1,136

 


 

 

(g)

Represents the current yield as of report date.

 

 

Financial futures contracts sold as of April 30,2012 were as follows:


 

 

 

 

 

 

 

 

 

 

 

 

 

 

Contracts

 

Issue

 

Exchange

 

Expiration

 

Notional
Value

 

Unrealized
Depreciation

 

200

 

10-Year US Treasury Note

 

Chicago Board of Trade

 

June 2012

 

$

26,456,250

 

$

(316,943

)


 

 

 

Fair Value Measurements — Various inputs are used in determining the fair value of investments and derivative financial instruments. These inputs are categorized into a disclosure hierarchy consisting of three broad levels for financial statement purposes as follows:

 

 

 

 

Level 1 — unadjusted price quotations in active markets/exchanges for identical assets and liabilities

 

 

 

 

Level 2 — other observable inputs (including, but not limited to: quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs)

 

 

 

 

Level 3 — unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Fund’s own assumptions used in determining the fair value of investments and derivative financial instruments)

 

 

 

 

Changes in valuation techniques may result in transfers into or out of an assigned level within the disclosure hierarchy. The categorization of a value determined for investments and derivative financial instruments is based on the pricing transparency of the investment and derivative financial instrument and is not necessarily an indication of the risks associated with investing in those securities. For information about the Fund’s policy regarding valuation of investments and derivative financial instruments and other significant accounting policies, please refer to Note 1 of the Notes to Financial Statements.

The following tables summarize the inputs used as of April 30, 2012 in determining the fair valuation of the Fund’s investments and derivative financial instruments:


 

 

 

 

 

 

 

 

 

 

 

 

 

 

Valuation Inputs

 

Level 1

 

Level 2

 

Level 3

 

Total

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

Investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

Long-Term
Investments1

 

 

 

$

554,930,379

 

 

 

$

554,930,379

 

Short-Term
Securities

 

$

9,127,957

 

 

 

 

 

 

9,127,957

 

Total

 

$

9,127,957

 

$

554,930,379

 

 

 

$

564,058,336

 


 

 

 

 

1

See above Schedule of Investments for values in each state or political subdivision.


 

 

 

 

 

 

 

 

 

 

 

 

 

 

Valuation Inputs

 

Level 1

 

Level 2

 

Level 3

 

Total

 

Derivative Financial
Instruments2

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest rate
contracts

 

$

(316,943

)

 

 

 

 

$

(316,943

)


 

 

 

 

2

Derivative financial instruments are financial futures contracts, which are valued at the unrealized appreciation/depreciation on the instrument.


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

23




 

 

 

 

Schedule of Investments April 30, 2012

BlackRock MuniHoldings Fund, Inc. (MHD)
(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Alabama — 1.8%

 

 

 

 

 

 

 

County of Jefferson Alabama, RB, Series A, 5.00%,
1/01/24

 

$

4,550

 

$

4,325,548

 

Alaska — 0.5%

 

 

 

 

 

 

 

Northern Tobacco Securitization Corp., Refunding RB,
Tobacco Settlement, Asset-Backed, Series A,
5.00%, 6/01/46

 

 

1,660

 

 

1,256,720

 

Arizona — 4.9%

 

 

 

 

 

 

 

Arizona Water Infrastructure Finance Authority, Refunding
RB, Water Quality Revenue, Series A, 5.00%, 10/01/23

 

 

3,190

 

 

3,990,626

 

Maricopa County IDA, RB, Arizona Charter Schools
Project, Series A, 6.75%, 7/01/29

 

 

2,200

 

 

1,516,570

 

Phoenix IDA Arizona, Refunding RB, America West
Airlines Inc. Project, AMT, 6.30%, 4/01/23

 

 

2,215

 

 

1,941,802

 

Salt Verde Financial Corp., RB, Senior:

 

 

 

 

 

 

 

5.00%, 12/01/32

 

 

2,000

 

 

2,038,700

 

5.00%, 12/01/37

 

 

2,360

 

 

2,394,102

 

Show Low Improvement District, Special Assessment
Bonds, District No. 5, 6.38%, 1/01/15

 

 

155

 

 

155,485

 

 

 

 

 

 

 

12,037,285

 

California — 12.1%

 

 

 

 

 

 

 

Agua Caliente Band of Cahuilla Indians, RB, 5.60%,
7/01/13 (a)

 

 

255

 

 

252,458

 

California Health Facilities Financing Authority, RB,
Sutter Health, Series B, 6.00%, 8/15/42

 

 

2,200

 

 

2,578,906

 

California Health Facilities Financing Authority, Refunding
RB, St. Joseph Health System, Series A, 5.75%,
7/01/39

 

 

1,530

 

 

1,732,021

 

California State Public Works Board, RB, Various Capital
Projects, Sub-Series I-1, 6.38%, 11/01/34

 

 

820

 

 

957,596

 

California Statewide Communities Development
Authority, RB:

 

 

 

 

 

 

 

John Muir Health, 5.13%, 7/01/39

 

 

1,510

 

 

1,581,317

 

Series A, 5.00%, 4/01/42

 

 

1,530

 

 

1,632,250

 

City of Los Angeles Department of Airports, RB, Series A,
5.25%, 5/15/39

 

 

555

 

 

611,505

 

City of Los Angeles Department of Airports, Refunding
RB, Senior, Los Angeles International Airport,
Series A, 5.00%, 5/15/40

 

 

4,115

 

 

4,469,178

 

Montebello Unified School District California, GO, CAB
(NPFGC) (b):

 

 

 

 

 

 

 

5.65%, 8/01/22

 

 

2,405

 

 

1,515,992

 

5.63%, 8/01/23

 

 

2,455

 

 

1,448,646

 

San Diego Unified School District California, GO, CAB,
Election of 2008, Series A, 6.06%, 7/01/29 (b)

 

 

3,475

 

 

1,500,887

 

State of California, GO, Various Purpose:

 

 

 

 

 

 

 

6.50%, 4/01/33

 

 

8,370

 

 

10,199,682

 

5.00%, 10/01/41

 

 

1,015

 

 

1,080,853

 

 

 

 

 

 

 

29,561,291

 

Colorado — 1.9%

 

 

 

 

 

 

 

Colorado Educational & Cultural Facilities Authority, RB,
Charter School, Colorado Springs, 5.50%, 7/01/40

 

 

1,455

 

 

1,478,804

 

Plaza Metropolitan District No. 1 Colorado, Tax Allocation
Bonds, Public Improvement Fee, Tax Increment,
Subordinate, 8.13%, 12/01/25

 

 

1,000

 

 

979,350

 

Regional Transportation District, COP, Series A, 5.38%,
6/01/31

 

 

710

 

 

789,811

 

University of Colorado, RB, Series A, 5.38%, 6/01/38

 

 

1,250

 

 

1,436,487

 

 

 

 

 

 

 

4,684,452

 


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Connecticut — 2.2%

 

 

 

 

 

 

 

Connecticut State Development Authority, RB, AFCO
Cargo BDL LLC Project, AMT, 8.00%, 4/01/30 (c)(d)

 

$

2,700

 

$

1,637,631

 

Connecticut State Health & Educational Facility
Authority, RB:

 

 

 

 

 

 

 

Ascension Health Senior Credit, 5.00%, 11/15/40

 

 

955

 

 

1,027,571

 

Wesleyan University, 5.00%, 7/01/35

 

 

2,515

 

 

2,797,912

 

 

 

 

 

 

 

5,463,114

 

Delaware — 1.4%

 

 

 

 

 

 

 

County of Sussex Delaware, RB, NRG Energy, Inc.,
Indian River Project, 6.00%, 10/01/40

 

 

790

 

 

855,428

 

Delaware State EDA, RB, Exempt Facilities, Indian
River Power, 5.38%, 10/01/45

 

 

2,430

 

 

2,508,756

 

 

 

 

 

 

 

3,364,184

 

District of Columbia — 3.1%

 

 

 

 

 

 

 

District of Columbia, Tax Allocation Bonds, City
Market O Street Project, 5.13%, 6/01/41

 

 

1,520

 

 

1,583,931

 

Metropolitan Washington Airports Authority, RB:

 

 

 

 

 

 

 

CAB, Second Senior Lien, Series B (AGC), 7.10%,
10/01/35 (b)

 

 

13,485

 

 

3,759,483

 

First Senior Lien, Series A, 5.00%, 10/01/39

 

 

505

 

 

540,476

 

First Senior Lien, Series A, 5.25%, 10/01/44

 

 

1,470

 

 

1,582,029

 

 

 

 

 

 

 

7,465,919

 

Florida — 6.9%

 

 

 

 

 

 

 

Broward County Water & Sewer Utility Revenue, RB,
Series A, 5.25%, 10/01/34

 

 

750

 

 

850,665

 

City of Clearwater Florida, RB, Series A, 5.25%,
12/01/39

 

 

2,375

 

 

2,651,426

 

County of Miami-Dade Florida, RB, CAB, Sub-Series A
(NPFGC), 5.24%, 10/01/37 (b)

 

 

2,340

 

 

528,208

 

County of Miami-Dade Florida, Refunding RB, Miami
International Airport, Series A-1, 5.38%, 10/01/41

 

 

2,620

 

 

2,894,995

 

Greater Orlando Aviation Authority Florida, RB, Special
Purpose, JetBlue Airways Corp., AMT, 6.50%, 11/15/36

 

 

2,095

 

 

2,110,126

 

Hillsborough County IDA, RB, National Gypsum Co.,
Series B, AMT, 7.13%, 4/01/30

 

 

1,900

 

 

1,880,715

 

Mid-Bay Bridge Authority, RB, Series A, 7.25%,
10/01/40

 

 

1,570

 

 

1,819,897

 

Midtown Miami Community Development District,
Special Assessment Bonds, Series B, 6.50%,
5/01/37

 

 

2,345

 

 

2,376,048

 

Palm Coast Park Community Development District,
Special Assessment Bonds, 5.70%, 5/01/37

 

 

660

 

 

429,026

 

Preserve at Wilderness Lake Community Development
District, Special Assessment Bonds, Series A,
5.90%, 5/01/34

 

 

1,450

 

 

1,391,435

 

 

 

 

 

 

 

16,932,541

 

Georgia — 1.3%

 

 

 

 

 

 

 

DeKalb Private Hospital Authority, Refunding RB,
Children’s Healthcare, 5.25%, 11/15/39

 

 

585

 

 

632,590

 

Metropolitan Atlanta Rapid Transit Authority, RB,
Sales Tax Revenue, Third Indenture, Series A,
5.00%, 7/01/39

 

 

2,410

 

 

2,615,067

 

 

 

 

 

 

 

3,247,657

 

Hawaii — 0.4%

 

 

 

 

 

 

 

State of Hawaii, Harbor System, Refunding RB, Series A,
5.25%, 7/01/30

 

 

945

 

 

1,042,505

 

Illinois — 10.7%

 

 

 

 

 

 

 

Chicago Board of Education Illinois, GO Series A:

 

 

 

 

 

 

 

5.50%, 12/01/39

 

 

1,460

 

 

1,650,282

 

5.00%, 12/01/41

 

 

485

 

 

521,685

 

Chicago O’Hare International Airport, GARB, Third Lien,
Series A, 5.75%, 1/01/39

 

 

2,000

 

 

2,290,420

 


 

 

 

See Notes to Financial Statements.

 

 

 

24

ANNUAL REPORT

APRIL 30, 2012




 

 

 

 

Schedule of Investments (continued)

BlackRock MuniHoldings Fund, Inc. (MHD)
(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Illinois (concluded)

 

 

 

 

 

 

 

City of Chicago Illinois, RB, O’Hare International Airport,
General, Third Lien, Series C (AGM), 6.50%, 1/01/41

 

$

4,055

 

$

4,863,608

 

City of Chicago Illinois, Refunding RB, Series A, 5.25%,
1/01/38

 

 

570

 

 

634,376

 

City of Chicago Illinois, Special Assessment Bonds,
Lake Shore East, 6.75%, 12/01/32

 

 

1,000

 

 

1,047,900

 

City of Chicago Illinois Transit Authority, RB, Sales Tax
Receipts Revenue, 5.25%, 12/01/40

 

 

730

 

 

809,402

 

Illinois Finance Authority, Refunding RB:

 

 

 

 

 

 

 

Central DuPage Health, Series B, 5.50%, 11/01/39

 

 

1,115

 

 

1,220,211

 

Series A, 5.00%, 11/15/37 (e)

 

 

675

 

 

733,678

 

Series A, 5.00%, 11/15/42 (e)

 

 

1,230

 

 

1,329,790

 

Illinois HDA, RB, Homeowner Mortgage, Sub-Series C2,
AMT, 5.35%, 2/01/27

 

 

2,525

 

 

2,531,843

 

Metropolitan Pier & Exposition Authority, Refunding RB,
McCormick Place Expansion Project (AGM):

 

 

 

 

 

 

 

CAB, Series B-1, 6.25%, 6/15/47 (b)

 

 

13,220

 

 

1,965,946

 

Series B-1, 5.00%, 6/15/50

 

 

2,190

 

 

2,281,126

 

Series B-2, 5.00%, 6/15/50

 

 

1,740

 

 

1,811,792

 

Railsplitter Tobacco Settlement Authority, RB:

 

 

 

 

 

 

 

5.50%, 6/01/23

 

 

930

 

 

1,062,776

 

6.00%, 6/01/28

 

 

800

 

 

907,808

 

State of Illinois, RB, Build Illinois, Series B, 5.25%,
6/15/34

 

 

440

 

 

484,088

 

 

 

 

 

 

 

26,146,731

 

Indiana — 2.2%

 

 

 

 

 

 

 

Indiana Finance Authority, Refunding RB:

 

 

 

 

 

 

 

Parkview Health System, Series A, 5.75%, 5/01/31

 

 

2,300

 

 

2,546,675

 

Sisters of St. Francis Health, 5.25%, 11/01/39

 

 

585

 

 

629,249

 

Wastewater Utility, CWA Authority Project, First Lien
Series A, 5.25%, 10/01/38

 

 

1,090

 

 

1,215,045

 

Indiana Municipal Power Agency, RB, Series B, 6.00%,
1/01/39

 

 

775

 

 

887,825

 

 

 

 

 

 

 

5,278,794

 

Iowa — 0.7%

 

 

 

 

 

 

 

Iowa Student Loan Liquidity Corp., Refunding RB,
Senior Series A-1, AMT, 5.15%, 12/01/22

 

 

1,435

 

 

1,596,251

 

Kansas — 1.2%

 

 

 

 

 

 

 

Kansas Development Finance Authority, Refunding RB:

 

 

 

 

 

 

 

Adventist Health, 5.75%, 11/15/38

 

 

1,520

 

 

1,738,454

 

Sisters of Leavenworth, Series A, 5.00%, 1/01/40

 

 

1,155

 

 

1,230,572

 

 

 

 

 

 

 

2,969,026

 

Kentucky — 0.3%

 

 

 

 

 

 

 

Kentucky Economic Development Finance Authority,
RB, Owensboro Medical Health System, Series A,
6.38%, 6/01/40

 

 

700

 

 

800,863

 

Louisiana — 2.0%

 

 

 

 

 

 

 

East Baton Rouge Sewerage Commission, RB, Series A,
5.25%, 2/01/39

 

 

570

 

 

626,618

 

Louisiana Local Government Environmental Facilities &
Community Development Authority, RB, 6.75%,
11/01/32

 

 

3,500

 

 

3,853,430

 

New Orleans Aviation Board, Refunding RB, Passenger
Facility Charge, Series A, 5.25%, 1/01/41

 

 

430

 

 

459,317

 

 

 

 

 

 

 

4,939,365

 

Maine — 0.4%

 

 

 

 

 

 

 

Maine Health & Higher Educational Facilities Authority,
RB, Series A, 5.00%, 7/01/39

 

 

210

 

 

222,161

 

Maine State Turnpike Authority, RB, Series A, 5.00%,
7/01/42

 

 

615

 

 

686,635

 

 

 

 

 

 

 

908,796

 


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Maryland — 2.1%

 

 

 

 

 

 

 

Maryland EDC, RB, Transportation Facilities Project,
Series A, 5.75%, 6/01/35

 

$

300

 

$

318,177

 

Maryland EDC, Refunding RB, CNX Marine Terminals,
Inc., 5.75%, 9/01/25

 

 

580

 

 

607,098

 

Maryland Health & Higher Educational Facilities
Authority, RB:

 

 

 

 

 

 

 

Charlestown Community, 6.25%, 1/01/41

 

 

1,520

 

 

1,689,495

 

Series B, 5.00%, 11/15/51 (e)

 

 

2,300

 

 

2,482,804

 

 

 

 

 

 

 

5,097,574

 

Massachusetts — 2.9%

 

 

 

 

 

 

 

Massachusetts Development Finance Agency, RB,
Wellesley College, Series J, 5.00%, 7/01/42

 

 

1,260

 

 

1,423,951

 

Massachusetts Development Finance Agency,
Refunding RB, Boston University, Series P, 5.45%,
5/15/59

 

 

1,165

 

 

1,302,284

 

Massachusetts Health & Educational Facilities Authority,
Refunding RB, Partners Healthcare, Series J1,
5.00%, 7/01/39

 

 

1,255

 

 

1,338,131

 

Massachusetts HFA, HRB, M/F Housing, Series A, AMT,
5.25%, 12/01/48

 

 

2,900

 

 

2,913,050

 

 

 

 

 

 

 

6,977,416

 

Michigan — 2.6%

 

 

 

 

 

 

 

City of Detroit Michigan, RB Senior Lien:

 

 

 

 

 

 

 

Series A, 5.25%, 7/01/41

 

 

2,145

 

 

2,187,063

 

Series B (AGM), 7.50%, 7/01/33

 

 

635

 

 

795,693

 

Kalamazoo Hospital Finance Authority, Refunding RB,
Bronson Methodist Hospital, 5.50%, 5/15/36

 

 

955

 

 

1,032,871

 

Michigan State Hospital Finance Authority, Refunding
RB, Henry Ford Health, 5.75%, 11/15/39

 

 

2,105

 

 

2,308,301

 

 

 

 

 

 

 

6,323,928

 

Minnesota — 3.1%

 

 

 

 

 

 

 

City of Minneapolis Minnesota, Refunding RB, Fairview
Health Services, Series A, 6.75%, 11/15/32

 

 

2,135

 

 

2,496,733

 

Tobacco Securitization Authority Minnesota, Refunding RB:

 

 

 

 

 

 

 

5.25%, 3/01/25

 

 

3,110

 

 

3,502,638

 

5.25%, 3/01/31

 

 

1,310

 

 

1,440,895

 

 

 

 

 

 

 

7,440,266

 

Mississippi — 0.3%

 

 

 

 

 

 

 

University of Southern Mississippi, RB, Campus
Facilities Improvements Project, 5.38%, 9/01/36

 

 

675

 

 

751,154

 

Nebraska — 1.6%

 

 

 

 

 

 

 

Central Plains Energy Project Nebraska, RB:

 

 

 

 

 

 

 

5.25%, 9/01/37

 

 

575

 

 

597,770

 

5.00%, 9/01/42

 

 

1,005

 

 

1,008,156

 

City of Omaha, RB, Nebraska Sanitary Sewerage
System, 4.25%, 11/15/38

 

 

2,130

 

 

2,218,203

 

 

 

 

 

 

 

3,824,129

 

New Hampshire — 1.4%

 

 

 

 

 

 

 

New Hampshire Health & Education Facilities
Authority, Refunding RB, Dartmouth-Hitchcock,
6.00%, 8/01/38

 

 

3,035

 

 

3,481,540

 

New Jersey — 4.1%

 

 

 

 

 

 

 

New Jersey EDA, RB, Continental Airlines Inc.
Project, AMT:

 

 

 

 

 

 

 

6.63%, 9/15/12

 

 

1,000

 

 

1,015,530

 

6.25%, 9/15/29

 

 

2,950

 

 

2,957,080

 

New Jersey EDA, Refunding RB, Cigarette Tax, 5.00%,
6/15/25

 

 

680

 

 

743,356

 


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

25




 

 

 

 

Schedule of Investments (continued)

BlackRock MuniHoldings Fund, Inc. (MHD)
(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

New Jersey (concluded)

 

 

 

 

 

 

 

New Jersey Transportation Trust Fund Authority, RB,
Transportation System:

 

 

 

 

 

 

 

Series A, 5.50%, 6/15/41

 

$

1,575

 

$

1,795,405

 

Series B, 5.25%, 6/15/36

 

 

1,705

 

 

1,905,201

 

Tobacco Settlement Financing Corp. New Jersey,
Refunding RB, Series 1A, 4.50%, 6/01/23

 

 

1,740

 

 

1,645,292

 

 

 

 

 

 

 

10,061,864

 

New York — 4.6%

 

 

 

 

 

 

 

Dutchess County Industrial Development Agency
New York, Refunding RB, St. Francis Hospital,
Series A, 7.50%, 3/01/29

 

 

890

 

 

908,023

 

Long Island Power Authority, Refunding RB, Series A,
5.75%, 4/01/39

 

 

1,450

 

 

1,653,681

 

Metropolitan Transportation Authority, Refunding RB:

 

 

 

 

 

 

 

Series B, 5.00%, 11/15/34

 

 

1,740

 

 

1,923,814

 

Series D, 5.25%, 11/15/40

 

 

840

 

 

919,136

 

New York City Industrial Development Agency, RB:

 

 

 

 

 

 

 

British Airways Plc Project, 7.63%, 12/01/32

 

 

1,500

 

 

1,548,750

 

Continental Airlines Inc. Project, Mandatory Put
Bonds, AMT, 8.38%, 11/01/16

 

 

725

 

 

730,764

 

Series C, 6.80%, 6/01/28

 

 

535

 

 

549,836

 

New York Liberty Development Corp., Refunding RB,
Second Priority, Bank of America Tower at One Bryant
Park Project, 6.38%, 7/15/49

 

 

850

 

 

946,330

 

Port Authority of New York & New Jersey, RB, JFK
International Air Terminal:

 

 

 

 

 

 

 

6.00%, 12/01/36

 

 

900

 

 

1,007,811

 

6.00%, 12/01/42

 

 

875

 

 

969,815

 

 

 

 

 

 

 

11,157,960

 

North Carolina — 0.4%

 

 

 

 

 

 

 

North Carolina Medical Care Commission, RB, Duke
University Health System, Series A, 5.00%, 6/01/42

 

 

970

 

 

1,043,555

 

Oregon — 0.2%

 

 

 

 

 

 

 

City of Tigard Washington County Oregon, RB, Water
System, 5.00%, 8/01/42 (e)

 

 

205

 

 

228,483

 

City of Tigard Washington County Oregon, Refunding RB,
Water System, 5.00%, 8/01/37 (e)

 

 

175

 

 

195,522

 

 

 

 

 

 

 

424,005

 

Pennsylvania — 4.8%

 

 

 

 

 

 

 

Allegheny County Hospital Development Authority,
RB, Health System, West Penn, Series A, 5.38%,
11/15/40

 

 

1,125

 

 

937,631

 

Bucks County IDA, RB, Ann’s Choice Inc. Facility,
Series A, 6.25%, 1/01/35

 

 

1,700

 

 

1,704,352

 

Pennsylvania Economic Development Financing
Authority, RB:

 

 

 

 

 

 

 

American Water Co. Project, 6.20%, 4/01/39

 

 

2,520

 

 

2,913,069

 

National Gypsum Co., Series B, AMT, 6.13%,
11/01/27

 

 

3,500

 

 

3,136,945

 

Philadelphia Authority for Industrial Development, RB:

 

 

 

 

 

 

 

Arbor House Inc. Project, Series E, 6.10%, 7/01/33

 

 

1,105

 

 

1,118,183

 

Commercial Development, AMT, 7.75%, 12/01/17

 

 

725

 

 

725,921

 

Saligman House Project, Series C, 6.10%, 7/01/33

 

 

1,245

 

 

1,259,853

 

 

 

 

 

 

 

11,795,954

 

Puerto Rico — 3.7%

 

 

 

 

 

 

 

Puerto Rico Commonwealth Aqueduct & Sewer
Authority, RB, Senior Lien, Series A:

 

 

 

 

 

 

 

5.13%, 7/01/37

 

 

240

 

 

239,477

 

5.25%, 7/01/42

 

 

400

 

 

398,768

 

Puerto Rico Sales Tax Financing Corp., RB:

 

 

 

 

 

 

 

First Sub-Series A, 6.50%, 8/01/44

 

 

3,860

 

 

4,525,657

 

Series A, 6.26%, 8/01/35 (b)

 

 

4,000

 

 

1,053,680

 


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Puerto Rico (concluded)

 

 

 

 

 

 

 

Puerto Rico Sales Tax Financing Corp., Refunding
RB, CAB (b):

 

 

 

 

 

 

 

First Sub-Series C, 6.53%, 8/01/38

 

$

2,975

 

$

636,620

 

Senior Series C, 6.25%, 8/01/39

 

 

9,665

 

 

2,139,734

 

 

 

 

 

 

 

8,993,936

 

South Carolina — 2.2%

 

 

 

 

 

 

 

South Carolina State Ports Authority, RB, 5.25%,
7/01/40

 

 

2,285

 

 

2,508,976

 

South Carolina State Public Service Authority, RB:

 

 

 

 

 

 

 

5.00%, 12/01/36

 

 

1,065

 

 

1,183,119

 

Series D, 5.00%, 12/01/43

 

 

1,465

 

 

1,602,109

 

 

 

 

 

 

 

5,294,204

 

Tennessee — 2.3%

 

 

 

 

 

 

 

Educational Funding of the South Inc., RB, Senior
Sub-Series B, AMT, 6.20%, 12/01/21

 

 

2,685

 

 

2,690,612

 

Hardeman County Correctional Facilities Corp.
Tennessee, RB, 7.75%, 8/01/17

 

 

2,685

 

 

2,684,597

 

Rutherford County Health & Educational Facilities
Board, RB, 5.00%, 11/15/47 (e)

 

 

150

 

 

161,922

 

 

 

 

 

 

 

5,537,131

 

Texas — 10.9%

 

 

 

 

 

 

 

Brazos River Harbor Navigation District, Refunding RB,
Dow Chemical Co. Project, Series A7, AMT, 6.63%,
5/15/33

 

 

3,655

 

 

3,696,521

 

Central Texas Regional Mobility Authority, RB, Senior Lien,
6.25%, 1/01/46

 

 

1,480

 

 

1,631,715

 

City of Dallas Texas, Refunding RB, Waterworks &
Sewer System, 5.00%, 10/01/35

 

 

1,050

 

 

1,181,901

 

City of Houston Texas, Refunding RB, Senior Lien,
Series A, 5.50%, 7/01/39

 

 

1,070

 

 

1,180,895

 

Harris County Health Facilities Development Corp.,
Refunding RB, Memorial Hermann Healthcare System,
Series B, 7.25%, 12/01/35

 

 

1,910

 

 

2,279,623

 

La Vernia Higher Education Finance Corp., RB, KIPP Inc.,
Series A, 6.38%, 8/15/44

 

 

450

 

 

504,887

 

North Texas Tollway Authority, RB, CAB, Special Projects
System, Series B, 7.55%, 9/01/37 (b)

 

 

1,400

 

 

336,756

 

North Texas Tollway Authority, Refunding RB, Toll,
Second Tier, Series F, 6.13%, 1/01/31

 

 

4,190

 

 

4,610,927

 

San Antonio Energy Acquisition Public Facility Corp.,
RB, Gas Supply:

 

 

 

 

 

 

 

5.50%, 8/01/24

 

 

1,100

 

 

1,235,872

 

5.50%, 8/01/25

 

 

1,120

 

 

1,254,691

 

Texas Private Activity Bond Surface Transportation
Corp., RB, Senior Lien:

 

 

 

 

 

 

 

LBJ Infrastructure Group LLC, LBJ Freeway Managed
Lanes Project, 7.00%, 6/30/40

 

 

2,990

 

 

3,478,147

 

NTE Mobility Partners LLC, North Tarrant Express
Managed Lanes Project, 6.88%, 12/31/39

 

 

1,700

 

 

1,949,713

 

Texas State Public Finance Authority, Refunding ERB,
KIPP Inc., Series A (ACA), 5.00%, 2/15/36

 

 

875

 

 

883,138

 

University of Texas System, Refunding RB, Revenue
Financing System, Series B, 5.00%, 8/15/43

 

 

2,145

 

 

2,450,834

 

 

 

 

 

 

 

26,675,620

 

Vermont — 1.0%

 

 

 

 

 

 

 

Vermont Educational & Health Buildings Financing
Agency, RB, Developmental & Mental Health, Series A,
6.00%, 6/15/17

 

 

2,370

 

 

2,394,364

 


 

 

 

See Notes to Financial Statements.

 

 

 

26

ANNUAL REPORT

APRIL 30, 2012




 

 

 

 

Schedule of Investments (continued)

BlackRock MuniHoldings Fund, Inc. (MHD)

(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Virginia — 1.6%

 

 

 

 

 

 

 

Fairfax County EDA, Refunding RB, Goodwin House Inc.,
5.13%, 10/01/42

 

$

1,000

 

$

1,008,190

 

Virginia Small Business Financing Authority, RB, AMT,
Senior Lien:

 

 

 

 

 

 

 

5.25%, 1/01/32

 

 

550

 

 

564,789

 

6.00%, 1/01/37

 

 

1,275

 

 

1,385,109

 

5.50%, 1/01/42

 

 

805

 

 

828,184

 

 

 

 

 

 

 

3,786,272

 

Washington — 1.2%

 

 

 

 

 

 

 

Seattle Housing Authority Washington, HRB,
Replacement Housing Projects, 6.13%, 12/01/32

 

 

1,225

 

 

1,226,556

 

Washington Health Care Facilities Authority, RB,
Swedish Health Services, Series A, 6.75%, 11/15/41

 

 

1,375

 

 

1,751,929

 

 

 

 

 

 

 

2,978,485

 

Wisconsin — 4.2%

 

 

 

 

 

 

 

State of Wisconsin, Refunding RB, Series A, 6.00%,
5/01/36

 

 

4,980

 

 

6,027,991

 

Wisconsin Health & Educational Facilities Authority, RB:

 

 

 

 

 

 

 

Ascension Health Senior Credit Group, 5.00%,
11/15/33

 

 

1,710

 

 

1,862,139

 

New Castle Place Project, Series A, 7.00%,
12/01/31

 

 

825

 

 

596,203

 

SynergyHealth Inc., 6.00%, 11/15/32

 

 

1,755

 

 

1,803,420

 

 

 

 

 

 

 

10,289,753

 

Wyoming — 0.1%

 

 

 

 

 

 

 

Wyoming Municipal Power Agency, RB, Series A,
5.00%, 1/01/42

 

 

210

 

 

222,554

 

Total Municipal Bonds — 109.3%

 

 

 

 

 

266,572,706

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Municipal Bonds Transferred to
Tender Option Bond Trusts (f)

 

 

 

 

 

 

 

Arizona — 0.7%

 

 

 

 

 

 

 

Salt River Project Agricultural Improvement & Power
District, RB, Series A, 5.00%, 1/01/38

 

 

1,690

 

 

1,832,651

 

California — 8.2%

 

 

 

 

 

 

 

Bay Area Toll Authority, Refunding RB, San Francisco
Bay Area, Series F-1, 5.63%, 4/01/44

 

 

2,270

 

 

2,545,233

 

California Educational Facilities Authority, RB, University
of Southern California, Series B, 5.25%, 10/01/39

 

 

1,845

 

 

2,093,282

 

Los Angeles Community College District California, GO,
Election of 2001, Series A (AGM), 5.00%, 8/01/32

 

 

1,620

 

 

1,819,195

 

San Diego Community College District California, GO,
Election of 2002, 5.25%, 8/01/33

 

 

748

 

 

858,303

 

San Francisco City & County Public Utilities Commission,
RB, Series B, 5.00%, 11/01/39

 

 

6,600

 

 

7,289,568

 

Sequoia Union High School District California, GO,
Refunding, Election of 2004, Series B (AGM),
5.50%, 7/01/35

 

 

3,494

 

 

3,780,053

 

University of California, RB, Limited Project, Series B,
4.75%, 5/15/38

 

 

1,670

 

 

1,707,273

 

 

 

 

 

 

 

20,092,907

 

Colorado — 2.5%

 

 

 

 

 

 

 

Colorado Health Facilities Authority, RB, Catholic
Health (AGM):

 

 

 

 

 

 

 

Series C-3, 5.10%, 10/01/41

 

 

2,580

 

 

2,703,376

 

Series C-7, 5.00%, 9/01/36

 

 

1,650

 

 

1,731,889

 

Colorado Health Facilities Authority, Refunding RB,
Catholic Health, Series A, 5.50%, 7/01/34

 

 

1,490

 

 

1,667,019

 

 

 

 

 

 

 

6,102,284

 


 

 

 

 

 

 

 

 

Municipal Bonds Transferred to
Tender Option Bond Trusts (f)

 

Par
(000)

 

Value

 

Connecticut — 3.0%

 

 

 

 

 

 

 

Connecticut State Health & Educational Facility
Authority, RB, Yale University:

 

 

 

 

 

 

 

Series T-1, 4.70%, 7/01/29

 

$

3,180

 

$

3,611,335

 

Series X-3, 4.85%, 7/01/37

 

 

3,270

 

 

3,625,220

 

 

 

 

 

 

 

7,236,555

 

Florida — 1.8%

 

 

 

 

 

 

 

County of Miami-Dade Florida, RB, Water & Sewer
System, 5.00%, 10/01/34

 

 

3,939

 

 

4,330,813

 

Georgia — 1.0%

 

 

 

 

 

 

 

Private Colleges & Universities Authority, Refunding RB,
Emory University, Series C, 5.00%, 9/01/38

 

 

2,259

 

 

2,455,638

 

Massachusetts — 3.7%

 

 

 

 

 

 

 

Massachusetts School Building Authority, RB:

 

 

 

 

 

 

 

Sales Tax Revenue, Series A (AGM), 5.00%,
8/15/30

 

 

4,994

 

 

5,524,462

 

Senior Series B, 5.00%, 10/15/41

 

 

3,150

 

 

3,530,331

 

 

 

 

 

 

 

9,054,793

 

New Hampshire — 0.7%

 

 

 

 

 

 

 

New Hampshire Health & Education Facilities Authority,
RB, Dartmouth College, 5.25%, 6/01/39

 

 

1,409

 

 

1,619,864

 

New York — 11.0%

 

 

 

 

 

 

 

Hudson Yards Infrastructure Corp., RB, 5.75%, 2/15/47

 

 

1,110

 

 

1,252,602

 

New York City Municipal Water Finance Authority, RB,
Water & Sewer, Series FF-2, 5.50%, 6/15/40

 

 

1,110

 

 

1,268,111

 

New York City Transitional Finance Authority, RB,
Future Tax Secured Revenue, Sub-Series E-1,
5.00%, 2/01/42

 

 

1,720

 

 

1,910,109

 

New York Liberty Development Corp., RB, 1 World
Trade Center, Port Authority Construction, 5.25%,
12/15/43

 

 

7,440

 

 

8,359,956

 

New York Liberty Development Corp., Refunding RB,
4 World Trade Center Project, 5.75%, 11/15/51

 

 

4,460

 

 

5,062,591

 

New York State Dormitory Authority, ERB, Series F,
5.00%, 3/15/35

 

 

4,034

 

 

4,373,188

 

Sales Tax Asset Receivable Corp., RB, Series A (AMBAC),
5.25%, 10/15/27

 

 

4,240

 

 

4,650,987

 

 

 

 

 

 

 

26,877,544

 

North Carolina — 0.5%

 

 

 

 

 

 

 

North Carolina Capital Facilities Finance Agency,
Refunding RB, Wake Forest University, 5.00%,
1/01/38

 

 

1,080

 

 

1,178,248

 

Ohio — 4.4%

 

 

 

 

 

 

 

State of Ohio, Refunding RB, Cleveland Clinic Health,
Series A, 5.50%, 1/01/39

 

 

9,644

 

 

10,630,616

 

Tennessee — 1.0%

 

 

 

 

 

 

 

Shelby County Health Educational & Housing Facilities
Board, Refunding RB, St. Jude’s Children’s Research
Hospital, 5.00%, 7/01/31

 

 

2,250

 

 

2,380,658

 

Texas — 3.1%

 

 

 

 

 

 

 

County of Harris Texas, RB, Senior Lien, Toll Road,
Series A, 5.00%, 8/15/38

 

 

4,620

 

 

5,022,079

 

Harris County Metropolitan Transit Authority, RB,
Series A, 5.00%, 11/01/41

 

 

2,350

 

 

2,592,896

 

 

 

 

 

 

 

7,614,975

 

Utah — 1.1%

 

 

 

 

 

 

 

City of Riverton Utah, RB, IHC Health Services Inc.,
5.00%, 8/15/41

 

 

2,519

 

 

2,700,247

 


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

27




 

 

 

 

Schedule of Investments (concluded)

BlackRock MuniHoldings Fund, Inc. (MHD)

(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds Transferred to
Tender Option Bond Trusts (f)

 

Par
(000)

 

Value

 

Virginia — 2.6%

 

 

 

 

 

 

 

University of Virginia, Refunding RB, General, 5.00%,
6/01/40

 

$

3,749

 

$

4,135,467

 

Virginia Small Business Financing Authority, Refunding
RB, Sentara Healthcare, 5.00%, 11/01/40

 

 

2,094

 

 

2,258,959

 

 

 

 

 

 

 

6,394,426

 

Washington — 0.8%

 

 

 

 

 

 

 

Central Puget Sound Regional Transit Authority, RB,
Series A (AGM), 5.00%, 11/01/32

 

 

1,860

 

 

2,090,247

 

Wisconsin — 1.8%

 

 

 

 

 

 

 

Wisconsin Health & Educational Facilities Authority,
Refunding RB, Froedtert & Community Health Inc.,
5.25%, 4/01/39

 

 

3,959

 

 

4,302,890

 

Total Municipal Bonds Transferred to
Tender Option Bond Trusts — 47.9%

 

 

 

 

 

116,895,356

 

Total Long-Term Investments
(Cost — $354,527,097) — 157.2%

 

 

 

 

 

383,468,062

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Short-Term Securities

 

Shares

 

 

 

 

FFI Institutional Tax-Exempt Fund, 0.09% (g)(h)

 

 

22,614

 

 

22,614

 

 

 

 

 

 

 

 

 

 

 

Par
(000
)

 

 

 

 

Connecticut Housing Finance Authority, RB, VRDN,
Housing Mortgage Finance Program, Sub-Series A-2
(JPMorgan Chase Bank NA SBPA), 0.25%,
5/01/12 (i)

 

$

1,950

 

 

1,950,000

 

Total Short-Term Securities
(Cost — $1,972,614) — 0.8%

 

 

 

 

 

1,972,614

 

Total Investments (Cost — $356,499,711) — 158.0%

 

 

 

 

 

385,440,676

 

Other Assets Less Liabilities — 1.8%

 

 

 

 

 

4,034,083

 

Liability for TOB Trust Certificates, Including
Interest Expense and Fees Payable — (25.5)%

 

 

 

 

 

(61,785,262

)

VMTP Shares, at Liquidation Value — (34.3)%

 

 

 

 

 

(83,700,000

)

Net Assets Applicable to Common Shares — 100.0%

 

 

 

 

$

243,989,497

 


 

 

 

 

(a)

Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933. These securities may be resold in transactions exempt from registration to qualified institutional investors.

 

 

(b)

Represents a zero-coupon bond. Rate shown reflects the current yield as of report date.

 

 

(c)

Issuer filed for bankruptcy and/or is in default of interest payments.

 

 

(d)

Non-income producing security.

 

 

(e)

When-issued security. Unsettled when-issued transactions were as follows:


 

 

 

 

 

 

 

 

Counterparty

 

Value

 

Unrealized
Appreciation

 

Morgan Stanley & Co., Inc.

 

$

4,708,194

 

$

43,605

 

Wells Fargo Securities

 

$

424,005

 

$

5,014

 


 

 

(f)

Securities represent bonds transferred to a TOB in exchange for which the Fund acquired residual interest certificates. These securities serve as collateral in a financing transaction. See Note 1 of the Notes to Financial Statements for details of municipal bonds transferred to TOBs.

 

 

(g)

Investments in companies considered to be an affiliate of the Fund during the year, for purposes of Section 2(a)(3) of the 1940 Act, as amended, were as follows:


 

 

 

 

 

 

 

 

 

 

 

 

 

 

Affiliate

 

Shares
Held at
April 30,
2011

 

Net
Activity

 

Shares
Held at
April 30,
2012

 

Income

 

FFI Institutional Tax-Exempt Fund

 

 

6,564,515

 

 

(6,541,901

)

 

22,614

 

$

1,738

 


 

 

(h)

Represents the current yield as of report date.

 

 

(i)

Variable rate security. Rate shown is as of report date and maturity shown is the date the principal owed can be recovered through demand.

 

 

Financial futures contracts sold as of April 30, 2012 were as follows:


 

 

 

 

 

 

 

 

 

 

 

 

 

 

Contracts

 

Issue

 

Exchange

 

Expiration

 

 

Notional
Value

 

 

Unrealized
Depreciation

 

210

 

10-Year US
Treasury Note

 

Chicago Board
of Trade

 

June 2012

 

$

27,779,063

 

$

(346,118

)


 

 

 

Fair Value Measurements — Various inputs are used in determining the fair value of investments and derivative financial instruments. These inputs are categorized into a disclosure hierarchy consisting of three broad levels for financial statement purposes as follows:

 

 

 

 

Level 1 — unadjusted price quotations in active markets/exchanges for identical assets and liabilities

 

 

 

 

Level 2 — other observable inputs (including, but not limited to: quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs)

 

 

 

 

Level 3 — unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Fund’s own assumptions used in determining the fair value of investments and derivative financial instruments)

 

 

 

 

Changes in valuation techniques may result in transfers into or out of an assigned level within the disclosure hierarchy. The categorization of a value determined for investments and derivative financial instruments is based on the pricing transparency of the investment and derivative financial instrument and is not necessarily an indication of the risks associated with investing in those securities. For information about the Fund’s policy regarding valuation of investments and derivative financial instruments and other significant accounting policies, please refer to Note 1 of the Notes to Financial Statements. The following tables summarize the inputs used as of April 30, 2012 in determining the fair valuation of the Fund’s investments and derivative financial instruments:


 

 

 

 

 

 

 

 

 

 

 

 

 

 

Valuation Inputs

 

Level 1

 

Level 2

 

Level 3

 

Total

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

Investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

Long Term
Investments1

 

 

 

$

383,468,062

 

 

 

$

383,468,062

 

Short-Term
Securities

 

$

22,614

 

 

1,950,000

 

 

 

 

1,972,614

 

Total

 

$

22,614

 

$

385,418,062

 

 

 

$

385,440,676

 


 

 

 

 

1

See above Schedule of Investments for values in each state or political subdivision.


 

 

 

 

 

 

 

 

 

 

 

 

 

 

Valuation Inputs

 

Level 1

 

Level 2

 

Level 3

 

Total

 

Derivative Financial
Instruments2

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest rate
contracts

 

$

(346,118

)

 

 

 

 

$

(346,118

)


 

 

 

 

2

Derivative financial instruments are financial futures contracts, which are valued at the unrealized appreciation/depreciation on the instrument.


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

 

28

ANNUAL REPORT

APRIL 30, 2012

 




 

 

 

 

Schedule of Investments April 30, 2012

BlackRock MuniHoldings Fund II, Inc. (MUH)

(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Alabama — 1.8%

 

 

 

 

 

 

 

County of Jefferson Alabama, RB, Series A, 5.00%,
1/01/24

 

$

3,450

 

$

3,279,812

 

Alaska — 0.7%

 

 

 

 

 

 

 

Northern Tobacco Securitization Corp., RB, 5.00%,
6/01/46

 

 

1,660

 

 

1,256,720

 

Arizona — 3.3%

 

 

 

 

 

 

 

Arizona Water Infrastructure Finance Authority, RB,
Series A, 5.00%, 10/01/23

 

 

2,310

 

 

2,889,764

 

Phoenix IDA Arizona, Refunding RB, America West
Airlines Inc. Project, AMT, 6.30%, 4/01/23

 

 

2,060

 

 

1,805,920

 

Pima County IDA, RB, Arizona Charter Schools Project,
Series C, 6.75%, 7/01/31

 

 

925

 

 

925,185

 

Show Low Improvement District, Special Assessment
Bonds, District No. 5, 6.38%, 1/01/15

 

 

325

 

 

326,017

 

 

 

 

 

 

 

5,946,886

 

California — 16.1%

 

 

 

 

 

 

 

Benicia Unified School District, GO, CAB, Refunding,
Series A (NPFGC), 5.63%, 8/01/20 (a)

 

 

2,000

 

 

1,509,820

 

California Health Facilities Financing Authority, RB,
Sutter Health, Series B, 6.00%, 8/15/42

 

 

1,585

 

 

1,857,985

 

California Health Facilities Financing Authority,
Refunding RB, St. Joseph Health System, Series A,
5.75%, 7/01/39

 

 

1,110

 

 

1,256,564

 

California State Public Works Board, RB, Various Capital
Projects, Sub-Series l-1, 6.38%, 11/01/34

 

 

600

 

 

700,680

 

California Statewide Communities Development
Authority, RB:

 

 

 

 

 

 

 

John Muir Health, 5.13%, 7/01/39

 

 

1,090

 

 

1,141,481

 

Kaiser Permanente, Series A, 5.00%, 4/01/42

 

 

1,110

 

 

1,184,181

 

City of Los Angeles Department of Airports, RB, Series A,
5.25%, 5/15/39

 

 

400

 

 

440,724

 

City of Los Angeles Department of Airports, Refunding
RB, Senior, Los Angeles International Airport, Series A,
5.00%, 5/15/40

 

 

2,975

 

 

3,231,058

 

San Diego Unified School District California, GO, CAB,
Election of 2008, Series A, 6.06%, 7/01/29 (a)

 

 

2,525

 

 

1,090,573

 

San Marino Unified School District California, GO,
Series A (NPFGC) (a):

 

 

 

 

 

 

 

5.51%, 7/01/17

 

 

1,820

 

 

1,616,651

 

5.56%, 7/01/18

 

 

1,945

 

 

1,664,531

 

5.60%, 7/01/19

 

 

2,070

 

 

1,685,125

 

State of California, GO, Various Purpose:

 

 

 

 

 

 

 

6.00%, 3/01/33

 

 

1,265

 

 

1,504,857

 

6.50%, 4/01/33

 

 

7,325

 

 

8,926,245

 

5.00%, 10/01/41

 

 

1,535

 

 

1,634,591

 

 

 

 

 

 

 

29,445,066

 

Colorado — 1.9%

 

 

 

 

 

 

 

Colorado Educational & Cultural Facilities Authority, RB,
Charter School, Colorado Springs, 5.50%, 7/01/40

 

 

1,055

 

 

1,072,260

 

Plaza Metropolitan District No. 1 Colorado, Tax Allocation
Bonds, Public Improvement Fee, Tax Increment,
8.13%, 12/01/25

 

 

860

 

 

842,241

 

Regional Transportation District, COP, Series A, 5.38%,
6/01/31

 

 

510

 

 

567,329

 

University of Colorado, RB, Series A, 5.38%, 6/01/38

 

 

920

 

 

1,057,255

 

 

 

 

 

 

 

3,539,085

 

Connecticut — 1.5%

 

 

 

 

 

 

 

Connecticut State Health & Educational Facility
Authority, RB:

 

 

 

 

 

 

 

Ascension Health Senior Credit, 5.00%, 11/15/40

 

 

685

 

 

737,053

 

Wesleyan University, 5.00%, 7/01/35

 

 

1,875

 

 

2,085,919

 

 

 

 

 

 

 

2,822,972

 

 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Delaware — 1.5%

 

 

 

 

 

 

 

County of Sussex Delaware, RB, NRG Energy, Inc.,
Indian River Project, 6.00%, 10/01/40

 

$

570

 

$

617,207

 

Delaware State EDA, RB, Exempt Facilities, Indian River
Power, 5.38%, 10/01/45

 

 

2,050

 

 

2,116,441

 

 

 

 

 

 

 

2,733,648

 

District of Columbia — 2.4%

 

 

 

 

 

 

 

Metropolitan Washington Airports Authority, RB:

 

 

 

 

 

 

 

CAB, Second Senior Lien, Series B (AGC), 7.08%,
10/01/34 (a)

 

 

10,170

 

 

3,027,100

 

First Senior Lien, Series A, 5.00%, 10/01/39

 

 

255

 

 

272,914

 

First Senior Lien, Series A, 5.25%, 10/01/44

 

 

1,000

 

 

1,076,210

 

 

 

 

 

 

 

4,376,224

 

Florida — 5.5%

 

 

 

 

 

 

 

Ballantrae Community Development District, Special
Assessment Bonds, 6.00%, 5/01/35

 

 

1,500

 

 

1,507,740

 

Broward County Water & Sewer Utility Revenue, RB,
Series A, 5.25%, 10/01/34

 

 

545

 

 

618,150

 

City of Clearwater Florida, RB, Series A, 5.25%,
12/01/39

 

 

1,725

 

 

1,925,773

 

County of Miami-Dade Florida, RB, CAB, Sub-Series A
(NPFGC), 5.24%, 10/01/37 (a)

 

 

1,765

 

 

398,413

 

Greater Orlando Aviation Authority Florida, RB, Special
Purpose, JetBlue Airways Corp., AMT, 6.50%,
11/15/36

 

 

1,515

 

 

1,525,938

 

Hillsborough County IDA, RB, National Gypsum Co.,
Series B, AMT, 7.13%, 4/01/30

 

 

1,380

 

 

1,365,993

 

Mid-Bay Bridge Authority, RB, Series A, 7.25%,
10/01/40

 

 

1,135

 

 

1,315,658

 

Palm Coast Park Community Development District,
Special Assessment Bonds, 5.70%, 5/01/37

 

 

480

 

 

312,019

 

Preserve at Wilderness Lake Community Development
District, Special Assessment Bonds, Series A,
5.90%, 5/01/34

 

 

1,175

 

 

1,127,542

 

 

 

 

 

 

 

10,097,226

 

Georgia — 1.3%

 

 

 

 

 

 

 

DeKalb Private Hospital Authority, Refunding RB,
Children’s Healthcare, 5.25%, 11/15/39

 

 

420

 

 

454,167

 

Metropolitan Atlanta Rapid Transit Authority, RB,
Sales Tax, Third Indenture Series, Series A, 5.00%,
7/01/39

 

 

1,740

 

 

1,888,057

 

 

 

 

 

 

 

2,342,224

 

Hawaii — 0.4%

 

 

 

 

 

 

 

State of Hawaii, Refunding RB, Series A, 5.25%,
7/01/30

 

 

680

 

 

750,162

 

Idaho — 1.1%

 

 

 

 

 

 

 

Power County Industrial Development Corp., RB, FMC
Corp. Project, AMT, 6.45%, 8/01/32

 

 

2,000

 

 

2,002,520

 

Illinois — 10.1%

 

 

 

 

 

 

 

Chicago Board of Education Illinois, GO:

 

 

 

 

 

 

 

5.50%, 12/01/39

 

 

1,060

 

 

1,198,150

 

5.00%, 12/01/41

 

 

350

 

 

376,474

 

Chicago O’Hare International Airport, GARB, Third Lien,
O’Hare International Airport, General, Third Lien,
Series A, 5.75%, 1/01/39

 

 

2,500

 

 

2,863,025

 

City of Chicago Illinois, RB, O’Hare International Airport,
General, Third Lien, Series C, 6.50%, 1/01/41

 

 

2,935

 

 

3,520,268

 

City of Chicago Illinois, Refunding RB, Sales Tax Revenue,
Series A, 5.25%, 1/01/38

 

 

410

 

 

456,305

 

City of Chicago Illinois, Special Assessment Bonds,
Lake Shore East, 6.75%, 12/01/32

 

 

900

 

 

943,110

 

City of Chicago Illinois Transit Authority, RB, 5.25%,
12/01/40

 

 

530

 

 

587,648

 


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

29




 

 

 

 

Schedule of Investments (continued)

BlackRock MuniHoldings Fund II, Inc. (MUH)

(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Illinois (concluded)

 

 

 

 

 

 

 

Illinois Finance Authority, Refunding RB:

 

 

 

 

 

 

 

Ascension Health Alliance, Series A, 5.00%,
11/15/37 (b)

 

$

490

 

$

532,596

 

Ascension Health Alliance, Series A, 5.00%,
11/15/42 (b)

 

 

890

 

 

962,206

 

Central DuPage Health, Series B, 5.50%, 11/01/39

 

 

800

 

 

875,488

 

Metropolitan Pier & Exposition Authority, Refunding
RB, McCormick Place Expansion Project:

 

 

 

 

 

 

 

CAB, Series B-1 (AGM), 6.25%, 6/15/47 (a)

 

 

9,555

 

 

1,420,924

 

Series B-1 (AGM), 5.00%, 6/15/50

 

 

1,585

 

 

1,650,952

 

Series B-2, 5.00%, 6/15/50

 

 

1,260

 

 

1,311,987

 

Railsplitter Tobacco Settlement Authority, RB:

 

 

 

 

 

 

 

5.50%, 6/01/23

 

 

675

 

 

771,370

 

6.00%, 6/01/28

 

 

500

 

 

567,380

 

State of Illinois, RB, Build Illinois, Series B, 5.25%,
6/15/34

 

 

315

 

 

346,563

 

 

 

 

 

 

 

18,384,446

 

Indiana — 2.1%

 

 

 

 

 

 

 

Indiana Finance Authority, RB:

 

 

 

 

 

 

 

CWA Authority Project, First Lien, Series A, 5.25%,
10/01/38

 

 

790

 

 

880,629

 

Parkview Health System, Series A, 5.75%, 5/01/31

 

 

1,660

 

 

1,838,035

 

Sisters of St. Francis Health, 5.25%, 11/01/39

 

 

420

 

 

451,769

 

Indiana Municipal Power Agency, RB, Series B, 6.00%,
1/01/39

 

 

565

 

 

647,252

 

 

 

 

 

 

 

3,817,685

 

Iowa — 0.7%

 

 

 

 

 

 

 

Iowa Student Loan Liquidity Corp., Refunding RB,
Series A-1, AMT, 5.15%, 12/01/22

 

 

1,080

 

 

1,201,360

 

Kansas — 1.1%

 

 

 

 

 

 

 

Kansas Development Finance Authority, Refunding RB:

 

 

 

 

 

 

 

Adventist Health, 5.75%, 11/15/38

 

 

1,105

 

 

1,263,811

 

Sisters of Leavenworth, Series A, 5.00%, 1/01/40

 

 

785

 

 

836,362

 

 

 

 

 

 

 

2,100,173

 

Kentucky — 0.3%

 

 

 

 

 

 

 

Kentucky Economic Development Finance Authority,
RB, Owensboro Medical Health System, Series A,
6.38%, 6/01/40

 

 

510

 

 

583,486

 

Louisiana — 1.9%

 

 

 

 

 

 

 

East Baton Rouge Sewerage Commission, RB, Series A,
5.25%, 2/01/39

 

 

420

 

 

461,718

 

Louisiana Local Government Environmental Facilities &
Community Development Authority, RB, 6.75%,
11/01/32

 

 

2,500

 

 

2,752,450

 

New Orleans Aviation Board, Refunding RB, Passenger
Facility Charge, Series A, 5.25%, 1/01/41

 

 

310

 

 

331,136

 

 

 

 

 

 

 

3,545,304

 

Maine — 0.4%

 

 

 

 

 

 

 

Maine Health & Higher Educational Facilities Authority,
RB, Series A, 5.00%, 7/01/39

 

 

150

 

 

158,687

 

Maine State Turnpike Authority, RB, Series A, 5.00%,
7/01/42

 

 

450

 

 

502,416

 

 

 

 

 

 

 

661,103

 

Maryland — 2.0%

 

 

 

 

 

 

 

Maryland EDC, RB, Transportation Facilities Project,
Series A, 5.75%, 6/01/35

 

 

220

 

 

233,330

 

Maryland EDC, Refunding RB, CNX Marine Terminals,
Inc., 5.75%, 9/01/25

 

 

415

 

 

434,389

 

 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Maryland (concluded)

 

 

 

 

 

 

 

Maryland Health & Higher Educational Facilities
Authority, Refunding RB:

 

 

 

 

 

 

 

Ascension Health, Series B, 5.00%, 11/15/51 (b)

 

$

1,665

 

$

1,797,334

 

Charlestown Community, 6.25%, 1/01/41

 

 

1,095

 

 

1,217,103

 

 

 

 

 

 

 

3,682,156

 

Massachusetts — 4.6%

 

 

 

 

 

 

 

Massachusetts Development Finance Agency, RB:

 

 

 

 

 

 

 

Neville Communities, Series A (Ginnie Mae),
5.75%, 6/20/22

 

 

600

 

 

648,156

 

Neville Communities, Series A (Ginnie Mae),
6.00%, 6/20/44

 

 

1,500

 

 

1,597,470

 

Wellesley College, Series J, 5.00%, 7/01/42

 

 

915

 

 

1,034,060

 

Massachusetts Development Finance Agency,
Refunding RB, Boston University, Series P, 5.45%,
5/15/59

 

 

845

 

 

944,575

 

Massachusetts Health & Educational Facilities
Authority, Refunding RB, Partners Healthcare,
Series J1, 5.00%, 7/01/39

 

 

910

 

 

970,278

 

Massachusetts HFA, HRB, M/F Housing, Series A, AMT,
5.25%, 12/01/48

 

 

2,100

 

 

2,109,450

 

Massachusetts HFA, Refunding HRB, Series F, AMT,
5.70%, 6/01/40

 

 

1,060

 

 

1,115,110

 

 

 

 

 

 

 

8,419,099

 

Michigan — 2.5%

 

 

 

 

 

 

 

City of Detroit Michigan, RB, Senior Lien:

 

 

 

 

 

 

 

Sewage Disposal System, Series B (AGM), 7.50%,
7/01/33

 

 

460

 

 

576,408

 

Water Supply System, Series A, 5.25%, 7/01/41

 

 

1,555

 

 

1,585,493

 

Kalamazoo Hospital Finance Authority, Refunding RB,
Bronson Methodist Hospital, 5.50%, 5/15/36

 

 

690

 

 

746,263

 

Michigan State Hospital Finance Authority, Refunding
RB, Hospital, Henry Ford Health, 5.75%, 11/15/39

 

 

1,520

 

 

1,666,801

 

 

 

 

 

 

 

4,574,965

 

Minnesota — 2.9%

 

 

 

 

 

 

 

City of Minneapolis Minnesota, Refunding RB, Fairview
Health Services, Series A, 6.75%, 11/15/32

 

 

1,540

 

 

1,800,922

 

Tobacco Securitization Authority Minnesota,
Refunding RB:

 

 

 

 

 

 

 

5.25%, 3/01/25

 

 

2,260

 

 

2,545,325

 

5.25%, 3/01/31

 

 

950

 

 

1,044,924

 

 

 

 

 

 

 

5,391,171

 

Nebraska — 1.5%

 

 

 

 

 

 

 

Central Plains Energy Project, RB, Gas Project No. 3:

 

 

 

 

 

 

 

5.25%, 9/01/37

 

 

415

 

 

431,434

 

5.00%, 9/01/42

 

 

730

 

 

732,292

 

City of Omaha, RB, Sanitation Sewerage System,
4.25%, 11/15/38

 

 

1,545

 

 

1,608,979

 

 

 

 

 

 

 

2,772,705

 

New Hampshire — 1.0%

 

 

 

 

 

 

 

New Hampshire Health & Education Facilities Authority,
Refunding RB, Dartmouth-Hitchcock, 6.00%,
8/01/38

 

 

1,530

 

 

1,755,109

 

New Jersey — 2.2%

 

 

 

 

 

 

 

New Jersey EDA, Refunding RB, Cigarette Tax, 5.00%,
6/15/25

 

 

490

 

 

535,653

 

New Jersey Transportation Trust Fund Authority, RB,
Transportation System:

 

 

 

 

 

 

 

Series A, 5.50%, 6/15/41

 

 

1,025

 

 

1,168,438

 

Series B, 5.25%, 6/15/36

 

 

1,235

 

 

1,380,014

 

Tobacco Settlement Financing Corp. New Jersey,
Refunding RB, Series 1A, 4.50%, 6/01/23

 

 

905

 

 

855,741

 

 

 

 

 

 

 

3,939,846

 


 

 

 

See Notes to Financial Statements.

 

 

 

30

ANNUAL REPORT

APRIL 30, 2012




 

 

 

 

Schedule of Investments (continued)

BlackRock MuniHoldings Fund II, Inc. (MUH)

(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

New York — 6.1%

 

 

 

 

 

 

 

Dutchess County Industrial Development Agency
New York, Refunding RB, St. Francis Hospital, Series A,
7.50%, 3/01/29

 

$

800

 

$

816,200

 

Long Island Power Authority, Refunding RB, Series A,
5.75%, 4/01/39

 

 

1,050

 

 

1,197,493

 

Metropolitan Transportation Authority, Refunding RB:

 

 

 

 

 

 

 

Series B, 5.00%, 11/15/34

 

 

1,270

 

 

1,404,163

 

Series D, 5.25%, 11/15/40

 

 

610

 

 

667,468

 

New York City Industrial Development Agency, RB:

 

 

 

 

 

 

 

Continental Airlines Inc. Project, AMT, 8.00%,
11/01/12

 

 

340

 

 

342,999

 

Continental Airlines Inc. Project, Mandatory Put
Bonds, AMT, 8.38%, 11/01/16

 

 

525

 

 

529,174

 

Series C, 6.80%, 6/01/28

 

 

415

 

 

426,508

 

New York City Transitional Finance Authority, RB, Fiscal
2009, Series S-3, 5.25%, 1/15/39

 

 

3,300

 

 

3,625,908

 

New York Liberty Development Corp., Refunding RB,
Second Priority, Bank of America Tower at One Bryant
Park Project, 6.38%, 7/15/49

 

 

615

 

 

684,698

 

Port Authority of New York & New Jersey, RB, JFK
International Air Terminal:

 

 

 

 

 

 

 

6.00%, 12/01/36

 

 

650

 

 

727,863

 

6.00%, 12/01/42

 

 

630

 

 

698,267

 

 

 

 

 

 

 

11,120,741

 

North Carolina — 0.4%

 

 

 

 

 

 

 

North Carolina Medical Care Commission, RB, Duke
University Health System, Series A, 5.00%, 6/01/42

 

 

705

 

 

758,460

 

Oregon — 0.2%

 

 

 

 

 

 

 

City of Tigard Washington County Oregon, Refunding RB,
Water System (b):

 

 

 

 

 

 

 

5.00%, 8/01/37

 

 

125

 

 

139,659

 

5.00%, 8/01/42

 

 

150

 

 

167,182

 

 

 

 

 

 

 

306,841

 

Pennsylvania — 3.2%

 

 

 

 

 

 

 

Allegheny County Hospital Development Authority,
Refunding RB, Health System, West Penn, Series A,
5.38%, 11/15/40

 

 

810

 

 

675,095

 

Pennsylvania Economic Development Financing
Authority, RB:

 

 

 

 

 

 

 

American Water Co. Project, 6.20%, 4/01/39

 

 

1,830

 

 

2,115,443

 

National Gypsum Co., Series A, AMT, 6.25%,
11/01/27

 

 

2,750

 

 

2,496,422

 

Philadelphia Authority for Industrial Development, RB,
Commercial Development, AMT, 7.75%, 12/01/17

 

 

540

 

 

540,686

 

 

 

 

 

 

 

5,827,646

 

Puerto Rico — 4.1%

 

 

 

 

 

 

 

Puerto Rico Commonwealth Aqueduct & Sewer
Authority, Refunding RB, Senior Lien, Series A:

 

 

 

 

 

 

 

5.13%, 7/01/37

 

 

175

 

 

174,618

 

5.25%, 7/01/42

 

 

290

 

 

289,107

 

Puerto Rico Sales Tax Financing Corp., RB:

 

 

 

 

 

 

 

CAB, Series A, 6.42%, 8/01/35 (a)

 

 

10,000

 

 

2,634,200

 

CAB, Series C, 6.25%, 8/01/39 (a)

 

 

2,800

 

 

619,892

 

First Sub-Series A, 6.50%, 8/01/44

 

 

2,790

 

 

3,271,135

 

Puerto Rico Sales Tax Financing Corp., Refunding RB,
CAB, First Sub-Series C, 6.53%, 8/01/38 (a)

 

 

2,145

 

 

459,009

 

 

 

 

 

 

 

7,447,961

 

 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

South Carolina — 2.1%

 

 

 

 

 

 

 

South Carolina State Ports Authority, RB, 5.25%,
7/01/40

 

$

1,650

 

$

1,811,733

 

South Carolina State Public Service Authority,
Refunding RB:

 

 

 

 

 

 

 

Series C, 5.00%, 12/01/36

 

 

770

 

 

855,401

 

Series D, 5.00%, 12/01/43

 

 

1,060

 

 

1,159,205

 

 

 

 

 

 

 

3,826,339

 

Tennessee — 1.3%

 

 

 

 

 

 

 

Hardeman County Correctional Facilities Corp.
Tennessee, RB, Series B, 7.38%, 8/01/17

 

 

2,200

 

 

2,205,654

 

Rutherford County Health & Educational Facilities
Board, Refunding RB, Ascension Health, Series C,
5.00%, 11/15/47 (b)

 

 

105

 

 

113,345

 

 

 

 

 

 

 

2,318,999

 

Texas — 9.0%

 

 

 

 

 

 

 

Brazos River Harbor Navigation District, Refunding RB,
Dow Chemical Co. Project, Series A7, AMT, 6.63%,
5/15/33

 

 

2,500

 

 

2,528,400

 

Central Texas Regional Mobility Authority, RB, Senior
Lien, 6.25%, 1/01/46

 

 

1,070

 

 

1,179,686

 

City of Dallas Texas, Refunding RB, 5.00%, 10/01/35

 

 

760

 

 

855,471

 

City of Houston Texas, Refunding RB, Senior Lien,
Series A, 5.50%, 7/01/39

 

 

535

 

 

590,448

 

Harris County Health Facilities Development Corp.,
Refunding RB, Memorial Hermann Healthcare System,
Series B, 7.25%, 12/01/35

 

 

1,380

 

 

1,647,058

 

La Vernia Higher Education Finance Corp., RB, KIPP Inc.,
Series A, 6.38%, 8/15/44

 

 

320

 

 

359,030

 

North Texas Tollway Authority, RB:

 

 

 

 

 

 

 

CAB, Special Projects System, Series B, 7.55%,
9/01/37 (a)

 

 

1,015

 

 

244,148

 

Toll, Second Tier, Series F, 6.13%, 1/01/31

 

 

3,020

 

 

3,323,389

 

Texas Private Activity Bond Surface Transportation Corp.,
RB, Senior Lien:

 

 

 

 

 

 

 

LBJ Infrastructure Group LLC, LBJ Freeway Managed
Lanes Project, 7.00%, 6/30/40

 

 

2,165

 

 

2,518,458

 

NTE Mobility Partners LLC, North Tarrant Express
Managed Lanes Project, 6.88%, 12/31/39

 

 

1,300

 

 

1,490,957

 

University of Texas System, Refunding RB, Series B,
5.00%, 8/15/43

 

 

1,555

 

 

1,776,712

 

 

 

 

 

 

 

16,513,757

 

Vermont — 0.5%

 

 

 

 

 

 

 

Vermont Educational & Health Buildings Financing
Agency, RB, Developmental & Mental Health, Series A,
6.50%, 6/15/32

 

 

1,000

 

 

977,970

 

Virginia — 2.5%

 

 

 

 

 

 

 

Fairfax County EDA, Refunding RB, Goodwin House Inc.,
5.13%, 10/01/42

 

 

2,500

 

 

2,520,475

 

Virginia Small Business Financing Authority, RB,
Senior Lien, Elizabeth River Crossings Project:

 

 

 

 

 

 

 

5.25%, 1/01/32

 

 

400

 

 

410,756

 

6.00%, 1/01/37

 

 

925

 

 

1,004,883

 

5.50%, 1/01/42

 

 

585

 

 

601,848

 

 

 

 

 

 

 

4,537,962

 

Washington — 1.2%

 

 

 

 

 

 

 

Seattle Housing Authority Washington, HRB,
Replacement Housing Projects, 6.13%, 12/01/32

 

 

910

 

 

911,156

 

Washington Health Care Facilities Authority, RB,
Swedish Health Services, Series A, 6.75%, 11/15/41

 

 

990

 

 

1,261,388

 

 

 

 

 

 

 

2,172,544

 


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

31




 

 

 

 

Schedule of Investments (continued)

BlackRock MuniHoldings Fund II, Inc. (MUH)

(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Wisconsin — 3.9%

 

 

 

 

 

 

 

State of Wisconsin, Refunding RB, Series A, 6.00%,
5/01/36

 

$

3,620

 

$

4,381,793

 

Wisconsin Health & Educational Facilities Authority, RB:

 

 

 

 

 

 

 

Ascension Health Senior Credit Group, 5.00%,
11/15/33

 

 

1,235

 

 

1,344,878

 

SynergyHealth, Inc., 6.00%, 11/15/32

 

 

1,360

 

 

1,397,522

 

 

 

 

 

 

 

7,124,193

 

Total Municipal Bonds — 105.3%

 

 

 

 

 

192,354,566

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Municipal Bonds Transferred to
Tender Option Bond Trusts (c)

 

 

 

 

 

 

 

Arizona — 0.7%

 

 

 

 

 

 

 

Salt River Project Agricultural Improvement & Power
District, RB, Series A, 5.00%, 1/01/38

 

 

1,220

 

 

1,322,979

 

California — 11.6%

 

 

 

 

 

 

 

Bay Area Toll Authority, Refunding RB, San Francisco
Bay Area, Series F-1, 5.63%, 4/01/44

 

 

1,640

 

 

1,838,847

 

California Educational Facilities Authority, RB, University
of Southern California, Series B, 5.25%, 10/01/39

 

 

1,335

 

 

1,514,651

 

Los Angeles Community College District California, GO,
Election of 2001, Series A (AGM), 5.00%, 8/01/32

 

 

1,170

 

 

1,313,863

 

San Diego Community College District California, GO,
Election of 2002, 5.25%, 8/01/33

 

 

553

 

 

635,144

 

San Francisco City & County Public Utilities
Commission, RB, Series B, 5.00%, 11/01/39

 

 

4,770

 

 

5,268,370

 

Sequoia Union High School District California, GO,
Refunding, Election of 2004, Series B (AGM),
5.50%, 7/01/35

 

 

5,519

 

 

5,970,213

 

University of California, RB, Limited Project, Series B,
4.75%, 5/15/38

 

 

4,599

 

 

4,702,667

 

 

 

 

 

 

 

21,243,755

 

Colorado — 2.4%

 

 

 

 

 

 

 

Colorado Health Facilities Authority, RB, Catholic Health:

 

 

 

 

 

 

 

Series C-3 (FSA), 5.10%, 10/01/41

 

 

1,870

 

 

1,959,423

 

Series C-7 (AGM), 5.00%, 9/01/36

 

 

1,200

 

 

1,259,556

 

Colorado Health Facilities Authority, Refunding RB,
Series A, 5.50%, 7/01/34

 

 

1,080

 

 

1,208,309

 

 

 

 

 

 

 

4,427,288

 

Connecticut — 2.9%

 

 

 

 

 

 

 

Connecticut State Health & Educational Facility
Authority, RB, Yale University:

 

 

 

 

 

 

 

Series T-1, 4.70%, 7/01/29

 

 

2,300

 

 

2,611,972

 

Series X-3, 4.85%, 7/01/37

 

 

2,370

 

 

2,627,453

 

 

 

 

 

 

 

5,239,425

 

Florida — 1.7%

 

 

 

 

 

 

 

County of Miami-Dade Florida, RB, Water & Sewer
System, 5.00%, 10/01/34

 

 

2,840

 

 

3,121,703

 

Georgia — 1.0%

 

 

 

 

 

 

 

Private Colleges & Universities Authority, Refunding RB,
Emory University, Series C, 5.00%, 9/01/38

 

 

1,649

 

 

1,792,833

 

Massachusetts — 3.2%

 

 

 

 

 

 

 

Massachusetts School Building Authority, RB:

 

 

 

 

 

 

 

Senior Series B, 5.00%, 10/15/41

 

 

2,280

 

 

2,555,287

 

Series A (AGM), 5.00%, 8/15/30

 

 

2,999

 

 

3,317,995

 

 

 

 

 

 

 

5,873,282

 

New Hampshire — 0.7%

 

 

 

 

 

 

 

New Hampshire Health & Education Facilities Authority,
Refunding RB, Dartmouth College, 5.25%, 6/01/39

 

 

1,019

 

 

1,171,817

 

 

 

 

 

 

 

 

 

Municipal Bonds Transferred to
Tender Option Bond Trusts (c)

 

Par
(000)

 

Value

 

New York — 10.8%

 

 

 

 

 

 

 

Hudson New York Yards Infrastructure Corp., RB,
5.75%, 2/15/47

 

$

810

 

$

914,061

 

New York City Municipal Water & Sewer Finance
Authority, RB, Series FF-2, 5.50%, 6/15/40

 

 

810

 

 

925,379

 

New York City Transitional Finance Authority, RB,
Future Tax Secured Revenue, Sub-Series E-1,
5.00%, 2/01/42

 

 

1,240

 

 

1,377,055

 

New York Liberty Development Corp., RB, 1 World Trade
Center Port Authority Construction, 5.25%, 12/15/43

 

 

5,400

 

 

6,067,710

 

New York Liberty Development Corp., Refunding RB,
4 World Trade Center Project, 5.75%, 11/15/51

 

 

3,250

 

 

3,689,107

 

New York State Dormitory Authority, ERB, Series F,
5.00%, 3/15/35

 

 

2,910

 

 

3,153,898

 

Sales Tax Asset Receivable Corp., RB, Series A (AMBAC),
5.25%, 10/15/27

 

 

3,200

 

 

3,510,179

 

 

 

 

 

 

 

19,637,389

 

North Carolina — 0.5%

 

 

 

 

 

 

 

North Carolina Capital Facilities Finance Agency,
Refunding RB, Wake Forest University, 5.00%,
1/01/38

 

 

800

 

 

872,776

 

Ohio — 4.2%

 

 

 

 

 

 

 

State of Ohio, Refunding RB, Cleveland Clinic Health,
Series A, 5.50%, 1/01/39

 

 

6,974

 

 

7,687,771

 

Tennessee — 1.5%

 

 

 

 

 

 

 

Shelby County Health Educational & Housing Facilities
Board, Refunding RB, St. Jude’s Children’s Research
Hospital, 5.00%, 7/01/31

 

 

2,500

 

 

2,645,175

 

Texas — 3.0%

 

 

 

 

 

 

 

County of Harris Texas, RB, Senior Lien, Toll Road,
Series A, 5.00%, 8/15/38

 

 

3,360

 

 

3,652,421

 

Harris County Metropolitan Transit Authority, TRAN, RB,
Series A, 5.00%, 11/01/41

 

 

1,710

 

 

1,886,745

 

 

 

 

 

 

 

5,539,166

 

Utah — 0.8%

 

 

 

 

 

 

 

City of Riverton Utah, RB, IHC Health Services Inc.,
5.00%, 8/15/41

 

 

1,395

 

 

1,494,780

 

Virginia — 2.6%

 

 

 

 

 

 

 

University of Virginia, Refunding RB, General, 5.00%,
6/01/40

 

 

2,729

 

 

3,010,620

 

Virginia Small Business Financing Authority, Refunding
RB, Sentara Healthcare, 5.00%, 11/01/40

 

 

1,553

 

 

1,674,552

 

 

 

 

 

 

 

4,685,172

 

Washington — 0.8%

 

 

 

 

 

 

 

Central Puget Sound Regional Transit Authority, RB,
Series A (AGM), 5.00%, 11/01/32

 

 

1,365

 

 

1,533,972

 

Wisconsin — 1.7%

 

 

 

 

 

 

 

Wisconsin Health & Educational Facilities Authority,
Refunding RB, Froedtert & Community Health Inc.,
5.25%, 4/01/39

 

 

2,859

 

 

3,107,643

 

Total Municipal Bonds Transferred to
Tender Option Bond Trusts — 50.1%

 

 

 

 

 

91,396,926

 

Total Long-Term Investments
(Cost — $259,955,185) — 155.4%

 

 

 

 

 

283,751,492

 


 

 

 

See Notes to Financial Statements.

 

 

 

32

ANNUAL REPORT

APRIL 30, 2012




 

 

 

 

Schedule of Investments (concluded)

BlackRock MuniHoldings Fund II, Inc. (MUH)

(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Short-Term Securities

 

Shares

 

Value

 

FFI Institutional Tax-Exempt Fund, 0.09% (d)(e)

 

 

27,550

 

$

27,550

 

 

 

 

 

 

 

 

 

 

 

Par
(000)

 

 

 

 

Connecticut Housing Finance Authority, RB, VRDN,
Housing Mortgage Finance Program, Sub-Series A-2
(JPMorgan Chase Bank NA SBPA), 0.25%,
5/01/12 (f)

 

$

300

 

 

300,000

 

Total Short-Term Securities

 

 

 

 

 

 

 

(Cost — $327,550) — 0.2%

 

 

 

 

 

327,550

 

Total Investments (Cost — $260,282,735) — 155.6%

 

 

 

 

 

284,079,042

 

Other Assets Less Liabilities — 1.0%

 

 

 

 

 

1,840,106

 

Liability for TOB Trust Certificates, Including
Interest Expense and Fees Payable — (26.5)%

 

 

 

 

 

(48,294,812

)

VMTP Shares, at Liquidation Value — (30.1)%

 

 

 

 

 

(55,000,000

)

Net Assets Applicable to Common Shares — 100.0%

 

 

 

 

$

182,624,336

 


 

 

 

 

(a)

Represents a zero-coupon bond. Rate shown reflects the current yield as of report date.

 

 

(b)

When-issued security. Unsettled when-issued transactions were as follows:


 

 

 

 

 

 

 

 

Counterparty

 

Value

 

Unrealized
Appreciation

 

Morgan Stanley & Co., Inc.

 

$

3,405,481

 

$

31,540

 

Wells Fargo Securities

 

$

306,841

 

$

3,633

 


 

 

(c)

Securities represent bonds transferred to a TOB in exchange for which the Fund acquired residual interest certificates. These securities serve as collateral in a financing transaction. See Note 1 of the Notes to Financial Statements for details of municipal bonds transferred to TOBs.

 

 

(d)

Investments in companies considered to be an affiliate of the Fund during the year, for purposes of Section 2(a)(3) of the 1940 Act, as amended, were as follows:


 

 

 

 

 

 

 

 

 

 

 

 

 

 

Affiliate

 

Shares
Held at
April 30,
2011

 

Net
Activity

 

Shares
Held at
April 30,
2012

 

Income

 

FFI Institutional Tax-Exempt Fund

 

 

3,999,689

 

 

(3,972,139

)

 

27,550

 

$

535

 


 

 

(e)

Represents the current yield as of report date.

 

 

(f)

Variable rate security. Rate shown is as of report date and maturity shown is the date the principal owed can be recovered through demand.

 

 

Financial futures contracts sold as of April 30, 2012 were as follows:


 

 

 

 

 

 

 

 

 

 

 

 

 

 

Contracts

 

Issue

 

Exchange

 

Expiration

 

Notional
Value

 

Unrealized
Depreciation

 

158

 

10-Year US
Treasury Note

 

Chicago Board
of Trade

 

June 2012

 

$

20,900,438

 

$

(261,175

)


 

 

 

Fair Value Measurements — Various inputs are used in determining the fair value of investments and derivative financial instruments. These inputs are categorized into a disclosure hierarchy consisting of three broad levels for financial statement purposes as follows:

 

 

 

 

Level 1 — unadjusted price quotations in active markets/exchanges for identical assets and liabilities

 

 

 

 

Level 2 — other observable inputs (including, but not limited to: quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs)

 

 

 

 

Level 3 — unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Fund’s own assumptions used in determining the fair value of investments and derivative financial instruments)

 

 

 

 

Changes in valuation techniques may result in transfers into or out of an assigned level within the disclosure hierarchy. The categorization of a value determined for investments and derivative financial instruments is based on the pricing transparency of the investment and derivative financial instrument and is not necessarily an indication of the risks associated with investing in those securities. For information about the Fund’s policy regarding valuation of investments and derivative financial instruments and other significant accounting policies, please refer to Note 1 of the Notes to Financial Statements.

The following tables summarize the inputs used as of April 30, 2012 in determining the fair valuation of the Fund’s investments and derivative financial instruments:


 

 

 

 

 

 

 

 

 

 

 

 

 

 

Valuation Inputs

 

Level 1

 

Level 2

 

Level 3

 

Total

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

Investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

Long-Term
Investments1

 

 

 

$

283,751,492

 

 

 

$

283,751,492

 

Short-Term
Securities

 

$

27,550

 

 

300,000

 

 

 

 

327,550

 

Total

 

$

27,550

 

$

284,051,492

 

 

 

$

284,079,042

 


 

 

 

 

1

See above Schedule of Investments for values in each state or political subdivision.


 

 

 

 

 

 

 

 

 

 

 

 

 

 

Valuation Inputs

 

Level 1

 

Level 2

 

Level 3

 

Total

 

Derivative Financial
Instruments2

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest rate
contracts

 

$

(261,175

)

 

 

 

 

$

(261,175

)


 

 

 

 

2

Derivative financial instruments are financial futures contracts, which are valued at the unrealized appreciation/depreciation on the instrument.


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

33




 

 

 

 

Schedule of Investments April 30, 2012

BlackRock MuniHoldings Quality Fund, Inc. (MUS)

(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Alabama — 2.9%

 

 

 

 

 

 

 

Birmingham Special Care Facilities Financing Authority,
RB, Children’s Hospital (AGC), 6.00%, 6/01/39

 

$

2,330

 

$

2,654,429

 

County of Jefferson Alabama, RB, Series A, 5.50%,
1/01/22

 

 

2,170

 

 

2,158,586

 

Selma Industrial Development Board, RB, International
Paper Company Project, Series A, 5.38%, 12/01/35

 

 

565

 

 

595,696

 

 

 

 

 

 

 

5,408,711

 

Arizona — 1.4%

 

 

 

 

 

 

 

Arizona State University, Refunding RB, Arizona Board of
Regents, Series A, 5.00%, 7/01/29

 

 

1,405

 

 

1,621,679

 

University of Arizona, RB, Arizona Board of Regents,
Series A, 5.00%, 6/01/42

 

 

1,000

 

 

1,111,240

 

 

 

 

 

 

 

2,732,919

 

California — 16.7%

 

 

 

 

 

 

 

California State Educational Facilities Authority, RB,
University of Southern California, Series A, 5.25%,
10/01/38

 

 

2,895

 

 

3,296,739

 

California Health Facilities Financing Authority, RB,
Scripps Health, Series A, 5.00%, 11/15/40

 

 

240

 

 

257,498

 

California Health Facilities Financing Authority,
Refunding RB, Sutter Health, Series B, 6.00%,
8/15/42

 

 

1,730

 

 

2,027,958

 

California Statewide Communities Development
Authority, RB, 5.00%, 4/01/42

 

 

1,410

 

 

1,504,230

 

Central Unified School District, GO, Election of 2008,
Series A (AGC), 5.63%, 8/01/33

 

 

1,325

 

 

1,497,555

 

City of San Jose California, ARB, Series A-1, AMT:

 

 

 

 

 

 

 

5.50%, 3/01/30

 

 

2,400

 

 

2,633,760

 

5.75%, 3/01/34

 

 

2,180

 

 

2,416,966

 

City of Sunnyvale California, Refunding RB, 5.25%,
4/01/40

 

 

1,605

 

 

1,804,855

 

County of Sacramento California, RB, Senior Series A
(AGC), 5.50%, 7/01/41

 

 

2,100

 

 

2,283,750

 

Los Angeles Community College District California, GO,
Election of 2008, Series C, 5.25%, 8/01/39

 

 

1,500

 

 

1,708,575

 

Los Angeles Department of Water & Power, RB, Power
System, Sub-Series A-1, 5.25%, 7/01/38

 

 

1,575

 

 

1,792,413

 

Oceanside Unified School District California, GO,
Series A (AGC), 5.25%, 8/01/33

 

 

1,825

 

 

2,010,402

 

Redondo Beach Unified School District, GO, Election of
2008, Series E, 5.50%, 8/01/34

 

 

1,335

 

 

1,544,408

 

San Bernardino Community College District, GO,
Election of 2002, Series A, 6.25%, 8/01/33

 

 

1,250

 

 

1,476,850

 

San Pablo Joint Powers Financing Authority California,
Tax Allocation Bonds, Refunding, CAB (NPFGC) (a):

 

 

 

 

 

 

 

5.66%, 12/01/24

 

 

2,635

 

 

1,214,735

 

5.66%, 12/01/25

 

 

2,355

 

 

1,003,560

 

5.66%, 12/01/26

 

 

2,355

 

 

926,386

 

Ventura County Community College District, GO,
Election of 2002, Series C, 5.50%, 8/01/33

 

 

1,850

 

 

2,165,665

 

 

 

 

 

 

 

31,566,305

 

Colorado — 1.2%

 

 

 

 

 

 

 

Colorado Health Facilities Authority, RB, Hospital,
NCMC, Inc. Project, Series B (AGM), 6.00%, 5/15/26

 

 

1,900

 

 

2,214,260

 

District of Columbia — 1.2%

 

 

 

 

 

 

 

District of Columbia Water & Sewer Authority, Public
Utility, RB, Series A, 5.50%, 10/01/39

 

 

2,000

 

 

2,246,460

 

Florida — 9.2%

 

 

 

 

 

 

 

City of Gainesville Florida, Refunding RB, Series C,
5.25%, 10/01/34

 

 

2,500

 

 

2,818,525

 

County of Lee Florida, Refunding ARB, Series A, AMT,
5.38%, 10/01/32

 

 

1,500

 

 

1,605,720

 


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Florida (concluded)

 

 

 

 

 

 

 

Jacksonville Port Authority, RB, AMT (AGC), 6.00%,
11/01/38

 

$

2,215

 

$

2,237,593

 

Orange County Health Facilities Authority, RB, The
Nemours Foundation Project, Series 2009A, 5.00%,
1/01/29

 

 

1,000

 

 

1,100,980

 

Orange County School Board, COP, Series A (AGC),
5.50%, 8/01/34

 

 

4,645

 

 

5,135,001

 

Tohopekaliga Water Authority, Refunding RB, Series A,
5.25%, 10/01/36

 

 

3,995

 

 

4,510,714

 

 

 

 

 

 

 

17,408,533

 

Illinois — 18.5%

 

 

 

 

 

 

 

Chicago Board of Education Illinois, GO, Series A:

 

 

 

 

 

 

 

5.50%, 12/01/39

 

 

2,000

 

 

2,260,660

 

5.00%, 12/01/41

 

 

4,330

 

 

4,657,521

 

City of Chicago Illinois, RB, Series A, 5.25%, 1/01/38

 

 

795

 

 

884,787

 

City of Chicago Illinois, RB, O’Hare International Airport:

 

 

 

 

 

 

 

General Third Lien, Series A, 5.75%, 1/01/39

 

 

1,145

 

 

1,311,266

 

General Third Lien, Series C (AGC), 5.25%,
1/01/35

 

 

1,255

 

 

1,373,271

 

General Third Lien, Series C, 6.50%, 1/01/41

 

 

5,225

 

 

6,266,917

 

Series A (AGM), 5.00%, 1/01/33

 

 

8,000

 

 

8,480,880

 

City of Chicago, Transit Authority, RB:

 

 

 

 

 

 

 

Federal Transit Administration Section 5309,
Series A (AGC), 6.00%, 6/01/26

 

 

2,000

 

 

2,330,500

 

Sales Tax Receipts, 5.25%, 12/01/36

 

 

635

 

 

707,295

 

Sales Tax Receipts, 5.25%, 12/01/40

 

 

1,810

 

 

2,006,874

 

Railsplitter Tobacco Settlement Authority, RB:

 

 

 

 

 

 

 

5.50%, 6/01/23

 

 

1,405

 

 

1,605,592

 

6.00%, 6/01/28

 

 

400

 

 

453,904

 

State of Illinois, RB, Build Illinois, Series B, 5.25%,
6/15/28

 

 

2,500

 

 

2,793,725

 

 

 

 

 

 

 

35,133,192

 

Indiana — 4.6%

 

 

 

 

 

 

 

Indiana Municipal Power Agency, RB, Series A (NPFGC),
5.00%, 1/01/42

 

 

3,500

 

 

3,721,095

 

Indianapolis Local Public Improvement Bond Bank, RB,
Series 2011F, 5.25%, 2/01/36

 

 

3,055

 

 

3,454,899

 

Indianapolis Local Public Improvement Bond Bank,
Refunding RB, Waterworks Project, Series A (AGC),

 

 

 

 

 

 

 

5.50%, 1/01/38

 

 

1,430

 

 

1,592,434

 

 

 

 

 

 

 

8,768,428

 

Iowa — 0.6%

 

 

 

 

 

 

 

Iowa Finance Authority, Refunding RB, Iowa Health
System (AGC), 5.25%, 2/15/29

 

 

1,080

 

 

1,181,693

 

Kentucky — 1.2%

 

 

 

 

 

 

 

Kentucky Turnpike Authority, RB, Revitalization Project,
Series A, 5.00%, 7/01/28

 

 

2,000

 

 

2,344,440

 

Massachusetts — 1.7%

 

 

 

 

 

 

 

Massachusetts Development Finance Agency, RB,
Wellesley College, Series J, 5.00%, 7/01/42

 

 

675

 

 

762,831

 

Massachusetts HFA, RB, Rental Mortgage, Series C,
AMT (AGM), 5.50%, 7/01/32

 

 

2,440

 

 

2,441,928

 

 

 

 

 

 

 

3,204,759

 

Michigan — 8.2%

 

 

 

 

 

 

 

City of Detroit Michigan, RB, Second Lien, Series B:

 

 

 

 

 

 

 

(AGM), 7.50%, 7/01/33

 

 

750

 

 

939,795

 

(NPFGC), 5.50%, 7/01/29

 

 

2,410

 

 

2,675,414

 

City of Detroit Michigan, Refunding RB, Senior Lien:

 

 

 

 

 

 

 

Series C-1 (AGM), 7.00%, 7/01/27

 

 

4,810

 

 

5,831,596

 

Series C-2 (BHAC), 5.25%, 7/01/29

 

 

1,910

 

 

2,098,383

 


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

 

34

ANNUAL REPORT

APRIL 30, 2012

 




 

 

 

 

Schedule of Investments (continued)

BlackRock MuniHoldings Quality Fund, Inc. (MUS)

(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Michigan (concluded)

 

 

 

 

 

 

 

Michigan State Building Authority, Refunding RB,
Facilities Program, Series I (AGC):

 

 

 

 

 

 

 

5.25%, 10/15/24

 

$

875

 

$

1,010,931

 

5.25%, 10/15/25

 

 

455

 

 

521,844

 

Royal Oak Hospital Finance Authority Michigan,
Refunding RB, William Beaumont Hospital, 8.25%,
9/01/39

 

 

1,910

 

 

2,428,909

 

 

 

 

 

 

 

15,506,872

 

Minnesota — 0.8%

 

 

 

 

 

 

 

City of Minneapolis Minnesota, Refunding RB, Series B
(AGC), 6.50%, 11/15/38

 

 

1,325

 

 

1,558,982

 

Nevada — 5.3%

 

 

 

 

 

 

 

Clark County Water Reclamation District, GO, Series A,
5.25%, 7/01/34

 

 

2,000

 

 

2,291,480

 

County of Clark Nevada, RB:

 

 

 

 

 

 

 

Las Vegas-McCarran International Airport, Series A
(AGC), 5.25%, 7/01/39

 

 

4,035

 

 

4,387,296

 

Las Vegas-McCarran, International Airport,
Series A-1 AMT (AGM), 5.00%, 7/01/23

 

 

1,750

 

 

1,865,815

 

Subordinate Lien, Series A-2 (NPFCG), 5.00%,
7/01/36

 

 

1,410

 

 

1,466,470

 

 

 

 

 

 

 

10,011,061

 

New Jersey — 8.6%

 

 

 

 

 

 

 

New Jersey EDA, RB, Motor Vehicle Surcharge, Series A
(NPFGC), 5.25%, 7/01/33

 

 

6,700

 

 

7,199,150

 

New Jersey Health Care Facilities Financing Authority,
RB, Virtua Health (AGC), 5.50%, 7/01/38

 

 

2,100

 

 

2,286,354

 

New Jersey Transportation Trust Fund Authority, RB,
Transportation System:

 

 

 

 

 

 

 

Series A, 5.50%, 6/15/41

 

 

1,780

 

 

2,029,093

 

Series A (AGC), 5.63%, 12/15/28

 

 

3,170

 

 

3,666,485

 

Series B, 5.25%, 6/15/36

 

 

1,000

 

 

1,117,420

 

 

 

 

 

 

 

16,298,502

 

New York — 7.8%

 

 

 

 

 

 

 

Hudson New York Yards Infrastructure Corp., RB,
Series A, 5.75%, 2/15/47

 

 

2,510

 

 

2,832,711

 

New York City Municipal Water and Sewer Finance
Authority, RB, Second General Resolution:

 

 

 

 

 

 

 

Fiscal 2009, Series EE, 5.25%, 6/15/40

 

 

3,410

 

 

3,812,926

 

New York City Municipal Water and Sewer Finance
Series EE, 5.38%, 6/15/43

 

 

1,305

 

 

1,484,711

 

New York City Transitional Finance Authority, RB:

 

 

 

 

 

 

 

Fiscal 2009, Series S-3, 5.25%, 1/15/39

 

 

1,400

 

 

1,538,264

 

Future Tax Secured, Sub-Series E, 5.00%, 11/01/39

 

 

1,600

 

 

1,766,528

 

New York State Dormitory Authority, RB, General
Purpose, Series C, 5.00%, 3/15/41

 

 

3,025

 

 

3,346,588

 

 

 

 

 

 

 

14,781,728

 

Pennsylvania — 0.7%

 

 

 

 

 

 

 

Philadelphia Hospitals & Higher Education Facilities
Authority, RB, The Children’s Hospital of Philadelphia
Project, Series D, 5.00%, 7/01/32

 

 

1,215

 

 

1,353,814

 

Puerto Rico — 1.3%

 

 

 

 

 

 

 

Puerto Rico Sales Tax Financing Corp., RB, First
Sub-Series A, 6.38%, 8/01/39

 

 

2,115

 

 

2,460,168

 

Texas — 25.1%

 

 

 

 

 

 

 

Austin Community College District, RB, Educational
Facilities Project, Round Rock Campus, 5.25%,
8/01/33

 

 

2,500

 

 

2,740,700

 

City of Houston Texas, Refunding RB, Combined
First Lien, Series A (AGC), 6.00%, 11/15/35

 

 

4,000

 

 

4,790,240

 


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Texas (concluded)

 

 

 

 

 

 

 

Clifton Higher Education Finance Corp., Refunding RB,
Baylor University, 5.25%, 3/01/32

 

$

1,840

 

$

2,096,330

 

Dallas Area Rapid Transit, Refunding RB, Senior Lien,
5.25%, 12/01/38

 

 

3,175

 

 

3,509,042

 

Harris County Cultural Education Facilities Finance
Corp., RB, Texas Children’s Hospital Project, Series
2009, 5.25%, 10/01/29

 

 

1,200

 

 

1,352,844

 

Harris County Health Facilities Development Corp.,
Refunding RB, Memorial Hermann Healthcare
System, Series B, 7.25%, 12/01/35

 

 

600

 

 

716,112

 

Lamar Texas Consolidated Independent School District,
GO, Refunding, Series A, 5.00%, 2/15/45

 

 

1,520

 

 

1,703,540

 

Lubbock Cooper ISD Texas, GO, School Building (AGC),
5.75%, 2/15/42

 

 

775

 

 

869,597

 

North Texas Tollway Authority, RB, Special Projects
System, Series A, 5.50%, 9/01/41

 

 

4,550

 

 

5,284,916

 

North Texas Tollway Authority, Refunding RB, First Tier
System (NPFGC):

 

 

 

 

 

 

 

5.75%, 1/01/40

 

 

4,885

 

 

5,304,182

 

Series A, 5.63%, 1/01/33

 

 

6,585

 

 

7,220,518

 

Series B, 5.75%, 1/01/40

 

 

6,275

 

 

6,813,458

 

Texas Tech University, Refunding RB, Improvement
Bonds Fourteenth, Series A, 5.00%, 8/15/31

 

 

1,765

 

 

2,024,649

 

University of Texas System, Refunding RB, Series B,
5.00%, 8/15/43

 

 

2,755

 

 

3,147,808

 

 

 

 

 

 

 

47,573,936

 

Virginia — 0.9%

 

 

 

 

 

 

 

Virginia Public School Authority, RB, School Financing,
6.50%, 12/01/35

 

 

1,500

 

 

1,755,870

 

Washington — 3.2%

 

 

 

 

 

 

 

City of Seattle Washington, Refunding RB, Series A,
5.25%, 2/01/36

 

 

1,375

 

 

1,566,111

 

State of Washington, GO, Various Purpose, Series B,
5.25%, 2/01/36

 

 

1,075

 

 

1,230,542

 

University of Washington, Refunding RB, Series A,
5.00%, 7/01/41

 

 

2,825

 

 

3,195,160

 

 

 

 

 

 

 

5,991,813

 

Wisconsin — 1.1%

 

 

 

 

 

 

 

Wisconsin Health & Educational Facilities Authority, RB,
Ascension Health Alliance, Series D, 5.00%,
11/15/41 (b)

 

 

1,880

 

 

2,038,747

 

Total Municipal Bonds — 122.2%

 

 

 

 

 

231,541,193

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Municipal Bonds Transferred to
Tender Option Bond Trusts (c)

 

 

 

 

 

 

 

Alabama — 1.2%

 

 

 

 

 

 

 

Mobile Board of Water & Sewer Commissioners, RB
(NPFGC), 5.00%, 1/01/31

 

 

2,120

 

 

2,230,007

 

California — 1.8%

 

 

 

 

 

 

 

Sequoia Union High School District California, GO,
Refunding, Election of 2004, Series B (AGM),
5.50%, 7/01/35

 

 

3,149

 

 

3,406,915

 

Colorado — 3.1%

 

 

 

 

 

 

 

Colorado Health Facilities Authority, RB, Catholic Health,
Series C-3 (AGM), 5.10%, 10/01/41

 

 

5,610

 

 

5,878,270

 

District of Columbia — 0.7%

 

 

 

 

 

 

 

District of Columbia Water & Sewer Authority, RB,
Senior Lien, Series A, 6.00%, 10/01/35

 

 

1,040

 

 

1,288,855

 


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

35




 

 

 

 

Schedule of Investments (continued)

BlackRock MuniHoldings Quality Fund, Inc. (MUS)

 

(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds Transferred to
Tender Option Bond Trusts (c)

 

Par
(000)

 

Value

 

Florida — 7.5%

 

 

 

 

 

 

 

City of St. Petersburg Florida, Refunding RB (NPFGC),
5.00%, 10/01/35

 

$

4,302

 

$

4,591,682

 

County of Miami-Dade Florida, GO, Building Better
Communities Program, Series B-1, 6.00%, 7/01/38

 

 

7,500

 

 

8,558,700

 

Lee County Housing Finance Authority, RB, Multi-County
Program, Series A-2, AMT (Ginnie Mae), 6.00%,
9/01/40

 

 

930

 

 

990,543

 

 

 

 

 

 

 

14,140,925

 

Georgia — 2.3%

 

 

 

 

 

 

 

Augusta-Richmond County Georgia, RB, Water & Sewer
(AGM), 5.25%, 10/01/34

 

 

4,000

 

 

4,326,400

 

Illinois — 1.4%

 

 

 

 

 

 

 

City of Chicago Illinois, Refunding RB, Second Lien
(AGM), 5.25%, 11/01/33

 

 

2,509

 

 

2,736,777

 

Kentucky — 0.8%

 

 

 

 

 

 

 

Kentucky State Property & Building Commission,
Refunding RB, Project No. 93 (AGC), 5.25%, 2/01/27

 

 

1,406

 

 

1,604,504

 

Massachusetts — 6.5%

 

 

 

 

 

 

 

Massachusetts School Building Authority, Sales Tax
Revenue RB:

 

 

 

 

 

 

 

Senior, Series B, 5.00%, 10/15/41

 

 

3,060

 

 

3,429,464

 

Series A (AGM), 5.00%, 8/15/30

 

 

8,008

 

 

8,859,047

 

 

 

 

 

 

 

12,288,511

 

Nevada — 5.5%

 

 

 

 

 

 

 

Clark County Water Reclamation District, GO:

 

 

 

 

 

 

 

Limited Tax, 6.00%, 7/01/38

 

 

5,000

 

 

6,137,350

 

Series B, 5.50%, 7/01/29

 

 

3,749

 

 

4,325,866

 

 

 

 

 

 

 

10,463,216

 

New Jersey — 1.3%

 

 

 

 

 

 

 

New Jersey State Housing & Mortgage Finance Agency,
RB, S/F Housing, Series CC, 5.25%, 10/01/29

 

 

2,291

 

 

2,464,958

 

New York — 5.3%

 

 

 

 

 

 

 

New York City Transitional Finance Authority, RB, 5.00%,
2/01/42

 

 

1,760

 

 

1,954,530

 

New York Liberty Development Corp., RB:

 

 

 

 

 

 

 

1 World Trade Center Port Authority Construction,
5.25%, 12/15/43

 

 

4,530

 

 

5,090,134

 

4 World Trade Center Project, 5.75%, 11/15/51

 

 

2,660

 

 

3,019,393

 

 

 

 

 

 

 

10,064,057

 

Puerto Rico — 1.0%

 

 

 

 

 

 

 

Puerto Rico Sales Tax Financing Corp., Refunding RB,
Series C, 5.25%, 8/01/40

 

 

1,820

 

 

1,991,444

 

Texas — 1.9%

 

 

 

 

 

 

 

Waco Educational Finance Corporation, RB, Baylor
University, 5.00%, 3/01/43

 

 

3,255

 

 

3,615,264

 

Utah — 0.6%

 

 

 

 

 

 

 

City of Riverton Utah, RB, IHC Health Services Inc.,
5.00%, 8/15/41

 

 

1,005

 

 

1,076,884

 

Washington — 2.4%

 

 

 

 

 

 

 

City of Bellevue Washington, GO, Refunding (NPFGC),
5.50%, 12/01/39

 

 

4,002

 

 

4,522,038

 

Total Municipal Bonds Transferred to
Tender Option Bond Trusts — 43.3%

 

 

 

 

 

82,099,025

 

Total Long-Term Investments
(Cost — $289,252,866) — 165.5%

 

 

 

 

 

313,640,218

 

 

 

 

 

 

 

 

 

Short-Term Securities

 

Shares

 

Value

 

FFI Institutional Tax-Exempt Fund, 0.09% (d)(e)

 

 

22,670

 

$

22,670

 

 

 

 

 

 

 

 

 

 

 

Par
(000)

 

 

 

 

Connecticut Housing Finance Authority, RB, VRDN,
Housing Mortgage Finance Program, Sub-Series A-2
(JPMorgan Chase Bank NA SBPA), 0.25%,
5/01/12 (f)

 

$

3,150

 

 

3,150,000

 

Total Short-Term Securities
(Cost — $3,172,670) — 1.7%

 

 

 

 

 

3,172,670

 

Total Investments (Cost — $292,425,536) — 167.2%

 

 

 

 

 

316,812,888

 

Other Assets Less Liabilities — 0.7%

 

 

 

 

 

1,402,284

 

Liability for TOB Trust Certificates, Including
Interest Expense and Fees Payable — (22.0)%

 

 

 

 

 

(41,648,183

)

VMTP Shares, at Liquidation Value — (45.9)%

 

 

 

 

 

(87,000,000

)

Net Assets Applicable to Common Shares — 100.0%

 

 

 

 

$

189,566,989

 


 

 

 

 

(a)

Represents a zero-coupon bond. Rate shown reflects the current yield as of report date.

 

 

(b)

When-issued security. Unsettled when-issued transactions were as follows:


 

 

 

 

 

 

 

 

Counterparty

 

Value

 

Unrealized
Appreciation

 

Morgan Stanley & Co., Inc.

 

$

2,038,747

 

$

18,913

 


 

 

(c)

Securities represent bonds transferred to a TOB in exchange for which the Fund acquired residual interest certificates. These securities serve as collateral in a financing transaction. See Note 1 of the Notes to Financial Statements for details of municipal bonds transferred to TOBs.

 

 

(d)

Investments in companies considered to be an affiliate of the Fund during the year, for purposes of Section 2(a)(3) of the 1940 Act, as amended, were as follows:


 

 

 

 

 

 

 

 

 

 

 

 

 

 

Affiliate

 

Shares
Held at
April 30,
2011

 

Net
Activity

 

Shares
Held at
April 30,
2012

 

Income

 

FFI Institutional Tax-Exempt Fund

 

 

6,952,084

 

 

(6,929,414

)

 

22,670

 

$

2,001

 


 

 

(e)

Represents the current yield as of report date.

 

 

(f)

Variable rate security. Rate shown is as of report date and maturity shown is the date the principal owed can be recovered through demand.

 

 

Financial futures contracts sold as of April 30, 2012 were as follows:


 

 

 

 

 

 

 

 

 

 

 

 

 

 

Contracts

 

Issue

 

Exchange

 

Expiration

 

Notional
Value

 

Unrealized
Depreciation

 

    192

 

10-Year US
Treasury Note

 

Chicago Board
of Trade

 

June 2012

 

$

25,398,000

 

$

(285,365

)


 

 

 

See Notes to Financial Statements.

 

 

 

36

ANNUAL REPORT

APRIL 30, 2012




 

 

 

 

Schedule of Investments (concluded)

BlackRock MuniHoldings Quality Fund, Inc. (MUS)


 

 

 

Fair Value Measurements — Various inputs are used in determining the fair value of investments and derivative financial instruments. These inputs are categorized into a disclosure hierarchy consisting of three broad levels for financial statement purposes as follows:

 

 

 

 

Level 1 — unadjusted price quotations in active markets/exchanges for identical assets and liabilities

 

 

 

 

Level 2 — other observable inputs (including, but not limited to: quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs)

 

 

 

 

Level 3 — unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Fund’s own assumptions used in determining the fair value of investments and derivative financial instruments)

 

 

 

 

Changes in valuation techniques may result in transfers into or out of an assigned level within the disclosure hierarchy. The categorization of a value determined for investments and derivative financial instruments is based on the pricing transparency of the investment and derivative financial instrument and is not necessarily an indication of the risks associated with investing in those securities. For information about the Fund’s policy regarding valuation of investments and derivative financial instruments and other significant accounting policies, please refer to Note 1 of the Notes to Financial Statements.

The following tables summarize the inputs used as of April 30, 2012 in determining the fair valuation of the Fund’s investments and derivative financial instruments:


 

 

 

 

 

 

 

 

 

 

 

 

 

 

Valuation Inputs

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

Investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

Long-Term
Investments1

 

 

 

$

313,640,218

 

 

 

$

313,640,218

 

Short-Term
Securities

 

$

22,670

 

 

3,150,000

 

 

 

 

3,172,670

 

Total

 

$

22,670

 

$

316,790,218

 

 

 

$

316,812,888

 


 

 

 

 

1

See above Schedule of Investments for values in each state or political subdivision.


 

 

 

 

 

 

 

 

 

 

 

 

 

 

Valuation Inputs

 

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Derivative Financial
Instruments2

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest rate
contracts

 

$

(285,365

)

 

 

 

 

$

(285,365

)


 

 

 

 

2

Derivative financial instruments are financial futures contracts, which are valued at the unrealized appreciation/depreciation on the instrument.


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

37




 

 

 

 

Schedule of Investments April 30, 2012

BlackRock Muni Intermediate Duration Fund, Inc. (MUI)

 

(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Alabama — 2.8%

 

 

 

 

 

 

 

Birmingham Special Care Facilities Financing Authority,
RB, Children’s Hospital (AGC), 6.00%, 6/01/34

 

$

4,615

 

$

5,311,496

 

County of Jefferson Alabama, RB, Series A:

 

 

 

 

 

 

 

5.50%, 1/01/21

 

 

5,500

 

 

5,479,705

 

5.25%, 1/01/23

 

 

6,500

 

 

6,333,860

 

 

 

 

 

 

 

17,125,061

 

Arizona — 5.2%

 

 

 

 

 

 

 

City of Tucson Arizona, COP (AGC):

 

 

 

 

 

 

 

4.25%, 7/01/21

 

 

1,870

 

 

2,096,569

 

4.25%, 7/01/22

 

 

1,895

 

 

2,101,536

 

Refunding, 4.00%, 7/01/20

 

 

2,325

 

 

2,634,457

 

Maricopa County IDA Arizona, RB, Arizona Charter
Schools Project, Series A, 6.63%, 7/01/20

 

 

2,200

 

 

1,759,142

 

Northern Arizona University, RB, 5.00%, 6/01/41

 

 

1,250

 

 

1,335,562

 

Phoenix Mesa Gateway Airport Authority, RB, Mesa
Project, AMT:

 

 

 

 

 

 

 

5.00%, 7/01/27

 

 

700

 

 

747,719

 

5.00%, 7/01/32

 

 

1,200

 

 

1,248,456

 

Pima County IDA Arizona, RB, Charter Schools Project:

 

 

 

 

 

 

 

Series C, 6.70%, 7/01/21

 

 

960

 

 

960,970

 

Series K, 6.38%, 7/01/31

 

 

930

 

 

916,757

 

Pima County IDA Arizona, Refunding RB, Tucson Electric
Power Co., San Juan, Series A, 4.95%, 10/01/20

 

 

2,325

 

 

2,534,413

 

Pinal County Electric District No. 3, Refunding RB,
5.00%, 7/01/25

 

 

1,600

 

 

1,780,144

 

Salt River Project Agricultural Improvement & Power
District, RB, Series A, 5.00%, 1/01/25

 

 

4,000

 

 

4,618,440

 

Scottsdale IDA, RB, Scottsdale Healthcare, Series C
(AGM), 5.00%, 9/01/35

 

 

3,650

 

 

3,927,838

 

State of Arizona, COP, Department of Administration,
Series A (AGM), 4.25%, 10/01/23

 

 

1,000

 

 

1,082,780

 

University of Arizona, RB, Speed, 5.00%, 8/01/28

 

 

3,630

 

 

4,038,811

 

 

 

 

 

 

 

31,783,594

 

Arkansas — 0.2%

 

 

 

 

 

 

 

University of Arkansas, GO, Refunding RB, Various Facility,
Series A, 5.00%, 11/01/31

 

 

1,000

 

 

1,182,610

 

California — 7.8%

 

 

 

 

 

 

 

California Health Facilities Financing Authority, Refunding
RB, Sutter Health, Series B, 5.00%, 8/15/22

 

 

2,135

 

 

2,528,715

 

California HFA, RB, Home Mortgage, Series K, AMT,
4.55%, 8/01/21

 

 

1,000

 

 

1,000,960

 

California HFA, Refunding RB, Home Mortgage, Series M,
AMT, 4.55%, 8/01/21

 

 

5,490

 

 

5,495,271

 

California Pollution Control Financing Authority, RB, AMT:

 

 

 

 

 

 

 

Republic Services Inc. Project, Series B, Mandatory
Put Bonds, 5.25%, 11/30/17 (a)

 

 

605

 

 

682,476

 

Waste Management Inc. Project, Series A-2,
5.40%, 4/01/25

 

 

1,240

 

 

1,335,009

 

California Pollution Control Financing Authority,
Refunding RB, Pacific Gas, Series C, AMT (NPFGC),
4.75%, 12/01/23

 

 

5,000

 

 

5,371,650

 

City of Sacramento California, Special Tax Bonds,
North Natomas Community Facilities, Series 4-C,
6.00%, 9/01/28

 

 

2,990

 

 

3,061,670

 

City of San Jose California, ARB, Series A-1, AMT,
5.00%, 3/01/25

 

 

3,000

 

 

3,236,130

 

City of San Jose California, GO, Libraries, Parks, and
Public Safety Project (NPFGC), 5.00%, 9/01/30

 

 

3,100

 

 

3,245,328

 

Golden State Tobacco Securitization Corp. California,
Refunding RB, Asset-Backed, Senior Series A-1,
5.00%, 6/01/15

 

 

5,000

 

 

5,247,300

 


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

California (concluded)

 

 

 

 

 

 

 

State of California, GO:

 

 

 

 

 

 

 

5.50%, 4/01/28

 

$

15

 

$

15,925

 

Various Purpose, 5.75%, 4/01/31

 

 

7,000

 

 

8,113,980

 

Various Purpose, 5.00%, 11/01/32

 

 

2,000

 

 

2,154,160

 

State of California, GO, Refunding, 3.00%, 2/01/24

 

 

1,570

 

 

1,550,312

 

Tamalpais Union High School District, GO, Election of
2001 (AGM), 5.00%, 8/01/13 (b)

 

 

4,875

 

 

5,161,455

 

 

 

 

 

 

 

48,200,341

 

Colorado — 1.0%

 

 

 

 

 

 

 

Plaza Metropolitan District No. 1 Colorado, Tax Allocation
Bonds, Public Improvement Fee, Tax Increment,
7.50%, 12/01/15

 

 

6,000

 

 

6,202,800

 

Connecticut — 2.2%

 

 

 

 

 

 

 

Connecticut State Development Authority, RB, Learjet Inc.
Project, AMT, 7.95%, 4/01/26

 

 

1,160

 

 

1,250,457

 

Connecticut State Health & Educational Facility
Authority, RB:

 

 

 

 

 

 

 

Connecticut College, Series I, 5.00%, 7/01/29

 

 

1,075

 

 

1,219,802

 

Connecticut College, Series I, 5.00%, 7/01/31

 

 

620

 

 

699,540

 

Connecticut College, Series I, 5.00%, 7/01/32

 

 

500

 

 

561,410

 

Lawrence & Memorial Hospital, Series F, 5.00%,
7/01/31

 

 

1,780

 

 

1,912,592

 

State of Connecticut, GO, Series B, 5.00%, 4/15/31 (c)

 

 

6,990

 

 

8,192,280

 

 

 

 

 

 

 

13,836,081

 

Delaware — 0.9%

 

 

 

 

 

 

 

Delaware State Municipal Electric Corp., RB, 5.00%,
7/01/37

 

 

5,000

 

 

5,392,300

 

Florida — 6.6%

 

 

 

 

 

 

 

Broward County School Board Florida, COP, Series A
(AGM), 5.00%, 7/01/24

 

 

10,000

 

 

11,276,100

 

County of Lee Florida, Refunding ARB, Series A, AMT:

 

 

 

 

 

 

 

5.50%, 10/01/23

 

 

1,000

 

 

1,142,240

 

(AGM), 5.00%, 10/01/27

 

 

1,635

 

 

1,746,997

 

County of Miami-Dade Florida, Refunding RB, Series C
(BHAC), 5.00%, 10/01/23

 

 

8,000

 

 

9,132,320

 

Greater Orlando Aviation Authority Airport Facilities,
Refunding RB, Series B, AMT:

 

 

 

 

 

 

 

5.00%, 10/01/25

 

 

1,000

 

 

1,102,570

 

5.00%, 10/01/26

 

 

2,935

 

 

3,201,880

 

Highlands County Health Facilities Authority, Refunding
RB, Adventist Health, Series G, 5.13%, 11/15/16 (b)

 

 

35

 

 

41,747

 

Lee County, Refunding RB, Series A, AMT, 5.63%,
10/01/26

 

 

500

 

 

555,535

 

Midtown Miami Community Development District,
Special Assessment Bonds:

 

 

 

 

 

 

 

Series A, 6.00%, 5/01/24

 

 

2,880

 

 

2,912,918

 

Series B, 6.50%, 5/01/37

 

 

1,870

 

 

1,894,759

 

Portofino Shores Community Development District,
Special Assessment Bonds, Series A, 6.40%,
5/01/34

 

 

1,085

 

 

1,094,288

 

South Lake County Hospital District, RB, South Lake
Hospital Inc., 6.63%, 10/01/23

 

 

2,390

 

 

2,471,714

 

Sterling Hill Community Development District, Special
Assessment Bonds, Refunding, Series B, 5.50%,
11/01/10 (d)(e)

 

 

155

 

 

108,545

 

University of Florida Research Foundation Inc., RB
(AMBAC), 5.13%, 9/01/33

 

 

4,000

 

 

3,999,720

 

 

 

 

 

 

 

40,681,333

 


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

38

ANNUAL REPORT

APRIL 30, 2012

 




 

 

 

Schedule of Investments (continued)

BlackRock Muni Intermediate Duration Fund, Inc. (MUI)

 

(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Georgia — 1.1%

 

 

 

 

 

 

 

Fulton County Development Authority, Refunding RB,
Robert Woodruff, Series B, 5.25%, 3/15/24

 

$

3,000

 

$

3,324,000

 

Medical Center Hospital Authority, Refunding RB,
Columbus Regional Healthcare (AGM):

 

 

 

 

 

 

 

4.00%, 8/01/23

 

 

1,500

 

 

1,583,370

 

4.13%, 8/01/24

 

 

2,000

 

 

2,104,240

 

 

 

 

 

 

 

7,011,610

 

Guam — 0.5%

 

 

 

 

 

 

 

Territory of Guam, RB, Section 30, Series A, 5.38%,
12/01/24

 

 

2,620

 

 

2,793,234

 

Hawaii — 0.9%

 

 

 

 

 

 

 

State of Hawaii, ARB, Series A, 5.25%, 7/01/29

 

 

5,000

 

 

5,590,450

 

Idaho — 0.6%

 

 

 

 

 

 

 

Idaho Health Facilities Authority, RB, St. Luke’s Regional
Medical Center (AGM), 4.63%, 7/01/30

 

 

3,700

 

 

3,928,512

 

Illinois — 6.0%

 

 

 

 

 

 

 

Chicago Transit Authority, RB, 5.25%, 12/01/31

 

 

2,000

 

 

2,260,280

 

City of Chicago Illinois, ARB, AMT (AGM), 5.75%,
1/01/23

 

 

8,130

 

 

8,582,353

 

Railsplitter Tobacco Settlement Authority, RB:

 

 

 

 

 

 

 

5.50%, 6/01/23

 

 

3,500

 

 

3,999,695

 

6.25%, 6/01/24

 

 

12,750

 

 

14,781,457

 

Village of Hodgkins Illinois, RB, MBM Project, AMT,
5.90%, 11/01/17

 

 

6,000

 

 

6,005,940

 

Village of Wheeling Illinois, Tax Allocation Bonds, North
Milwaukee/Lake-Cook TIF Project, 6.00%, 1/01/25

 

 

1,480

 

 

1,452,857

 

 

 

 

 

 

 

37,082,582

 

Indiana — 4.0%

 

 

 

 

 

 

 

City of Whiting Indiana, RB, BP Products North America,
5.25%, 1/01/21

 

 

4,800

 

 

5,732,112

 

County of Jasper Indiana, Refunding RB, Northern
Indiana Public Service Co., Series C (NPFGC),
5.85%, 4/01/19

 

 

2,000

 

 

2,351,820

 

Indiana Finance Authority, Refunding RB, Environmental
Improvement, United Steel Corp. Project, 6.00%,
12/01/19

 

 

5,000

 

 

5,301,200

 

Indiana Finance Authority Wastewater Utility, RB,
5.25%, 10/01/31

 

 

10,000

 

 

11,454,100

 

 

 

 

 

 

 

24,839,232

 

Iowa — 1.0%

 

 

 

 

 

 

 

Iowa Higher Education Loan Authority, RB, Private
College Facility:

 

 

 

 

 

 

 

5.25%, 4/01/23

 

 

695

 

 

817,932

 

5.25%, 4/01/24

 

 

730

 

 

848,070

 

5.25%, 4/01/25

 

 

520

 

 

598,650

 

5.25%, 4/01/26

 

 

360

 

 

409,763

 

Iowa Higher Education Loan Authority, Refunding RB,
Private College Facility:

 

 

 

 

 

 

 

5.00%, 9/01/20

 

 

1,000

 

 

1,098,490

 

5.00%, 9/01/22

 

 

2,315

 

 

2,477,605

 

 

 

 

 

 

 

6,250,510

 

Kansas — 2.7%

 

 

 

 

 

 

 

City of Dodge City Kansas, RB (AGC), 4.00%, 6/01/24

 

 

2,245

 

 

2,419,863

 

Kansas Development Finance Authority, RB, KU Health
System, Series H:

 

 

 

 

 

 

 

5.00%, 3/01/26

 

 

3,220

 

 

3,472,126

 

5.00%, 3/01/27

 

 

3,905

 

 

4,195,142

 

Kansas Development Finance Authority, Refunding RB:

 

 

 

 

 

 

 

Adventist Health, 5.00%, 11/15/23

 

 

1,500

 

 

1,720,515

 

Adventist/Sunbelt, Series D, 5.00%, 11/15/24

 

 

1,000

 

 

1,103,010

 

Sisters of Leavenworth, Series A, 4.00%, 1/01/22

 

 

3,425

 

 

3,733,969

 

 

 

 

 

 

 

16,644,625

 

 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Kentucky — 3.1%

 

 

 

 

 

 

 

Kentucky Economic Development Finance Authority,
Refunding RB, Owensboro Medical Health System,
Series A, 5.25%, 6/01/23

 

$

8,650

 

$

9,521,574

 

Kentucky State Property & Buildings Commission,
Refunding RB, Project No. 93 (AGC), 5.25%, 2/01/24

 

 

8,000

 

 

9,323,760

 

 

 

 

 

 

 

18,845,334

 

Louisiana — 6.1%

 

 

 

 

 

 

 

Jefferson Parish Hospital Service District No. 1,
Refunding RB, West Jefferson Medical Center,
Series A (AGM), 5.50%, 1/01/26

 

 

3,000

 

 

3,299,070

 

Louisiana Local Government Environmental Facilities &
Community Development Authority, Refunding RB,
BRCC Facilities Corp. Project:

 

 

 

 

 

 

 

5.00%, 12/01/27

 

 

3,445

 

 

3,812,375

 

5.00%, 12/01/28

 

 

3,715

 

 

4,098,499

 

Louisiana Public Facilities Authority, RB, Nineteenth
Judicial District Court (NPFGC), 5.50%, 6/01/41

 

 

2,000

 

 

2,147,220

 

Louisiana Public Facilities Authority, Refunding RB,
Entergy Gulf States Louisiana, LLC Project, Series A,
5.00%, 9/01/28

 

 

5,000

 

 

5,203,600

 

New Orleans Aviation Board Louisiana, Refunding
GARB, Restructuring, Series A-2, (AGC), 6.00%,
1/01/23

 

 

850

 

 

1,012,112

 

Port of New Orleans Louisiana, Refunding RB,
Continental Grain Co. Project, 6.50%, 1/01/17

 

 

3,500

 

 

3,504,480

 

State of Louisiana, GO, Series A, 5.00%, 8/01/24

 

 

12,000

 

 

14,755,320

 

 

 

 

 

 

 

37,832,676

 

Maine — 0.3%

 

 

 

 

 

 

 

Portland New Public Housing Authority Maine, Refunding
RB, Senior Living, Series A, 6.00%, 2/01/34

 

 

1,965

 

 

1,999,034

 

Maryland — 0.7%

 

 

 

 

 

 

 

Maryland EDC, RB, Transportation Facilities Project,
Series A, 5.13%, 6/01/20

 

 

1,750

 

 

1,875,685

 

Maryland EDC, Refunding RB, CNX Marine Terminals Inc.,
5.75%, 9/01/25

 

 

790

 

 

826,909

 

Maryland Health & Higher Educational Facilities
Authority, RB, Johns Hopkins Health System, Series B,
5.00%, 7/01/33 (c)

 

 

1,140

 

 

1,280,015

 

Maryland Industrial Development Financing Authority,
RB, Our Lady of Good Counsel School, Series A,
6.00%, 5/01/35

 

 

500

 

 

509,875

 

 

 

 

 

 

 

4,492,484

 

Massachusetts — 0.2%

 

 

 

 

 

 

 

Massachusetts Health & Educational Facilities Authority,
RB, Winchester Hospital, 5.00%, 7/01/25

 

 

1,060

 

 

1,113,954

 

Michigan — 4.0%

 

 

 

 

 

 

 

City of Detroit Michigan, Refunding RB, Second Lien,
Series C (BHAC), 5.75%, 7/01/26

 

 

4,235

 

 

4,846,534

 

Manistee Area Public Schools, GO, Refunding (Q-SBLF),
5.00%, 5/01/25

 

 

1,000

 

 

1,115,550

 

Michigan State Building Authority, Refunding RB,
Facilities Program, Series A, 5.00%, 10/15/24

 

 

2,500

 

 

2,907,500

 

Michigan State Hospital Finance Authority, Refunding
RB, Henry Ford Health, 5.25%, 11/15/24

 

 

4,900

 

 

5,373,487

 

State of Michigan Trunk Line Fund, RB, 5.00%,
11/15/31

 

 

2,000

 

 

2,279,860

 

Wayne County Airport Authority, RB, Detroit Metropolitan
Wayne County Airport, AMT (AGC), 4.75%, 12/01/18

 

 

7,665

 

 

8,126,740

 

 

 

 

 

 

 

24,649,671

 


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

39




 

 

 

Schedule of Investments (continued)

BlackRock Muni Intermediate Duration Fund, Inc. (MUI)
(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Minnesota — 0.6%

 

 

 

 

 

 

 

City of St. Cloud Minnesota, RB, Centracare Health
System, Series A, 4.25%, 5/01/21

 

$

2,300

 

$

2,557,485

 

University of Minnesota, RB, Biomedical Science
Research Facilities Funding Program, Series B,
5.00%, 8/01/36

 

 

1,000

 

 

1,137,120

 

 

 

 

 

 

 

3,694,605

 

Mississippi — 1.5%

 

 

 

 

 

 

 

Mississippi Business Finance Corp., Refunding RB,
System Energy Resource Inc. Project:

 

 

 

 

 

 

 

5.88%, 4/01/22

 

 

5,000

 

 

5,014,500

 

5.90%, 5/01/22

 

 

4,410

 

 

4,422,789

 

 

 

 

 

 

 

9,437,289

 

Missouri — 3.0%

 

 

 

 

 

 

 

Missouri Development Finance Board, RB, St. Joseph
Sewage System Improvements, Series E, 4.75%,
5/01/26

 

 

750

 

 

771,982

 

Missouri Joint Municipal Electric Utility Commission
Power, RB, Prairie State Project, Series A (BHAC),
5.00%, 1/01/32

 

 

5,000

 

 

5,342,500

 

Missouri State Environmental Improvement & Energy
Resources Authority, Refunding RB, Revolving Funds
Program, Series A, 5.00%, 1/01/25

 

 

3,150

 

 

3,871,224

 

Missouri State Health & Educational Facilities Authority,
RB, SSM Health Care, Series B, 4.25%, 6/01/25

 

 

8,125

 

 

8,686,600

 

 

 

 

 

 

 

18,672,306

 

Montana — 0.5%

 

 

 

 

 

 

 

Montana Facility Finance Authority, Refunding RB,
Series B, 5.00%, 1/01/24

 

 

2,625

 

 

2,964,911

 

Nebraska — 0.8%

 

 

 

 

 

 

 

Douglas County School District No. 17 Nebraska, GO,
Refunding, 2.00%, 6/15/25

 

 

4,380

 

 

4,110,805

 

Lancaster County Hospital Authority No. 1, RB,
Immanuel Obligation Group, 5.50%, 1/01/30

 

 

1,000

 

 

1,099,560

 

 

 

 

 

 

 

5,210,365

 

Nevada — 1.0%

 

 

 

 

 

 

 

County of Clark Nevada, Special Assessment Bonds,
Special Improvement District No. 142, Local
Improvement, 6.38%, 8/01/23

 

 

2,060

 

 

2,127,259

 

County of Humboldt Nevada, Refunding RB, Idaho
Power Co. Project, 5.15%, 12/01/24

 

 

3,800

 

 

4,219,026

 

 

 

 

 

 

 

6,346,285

 

New Jersey — 15.5%

 

 

 

 

 

 

 

Essex County Improvement Authority, RB, Newark Project,
Series A (AGM), 5.00%, 11/01/20

 

 

2,000

 

 

2,289,520

 

Garden State Preservation Trust, RB, Election of 2005,
Series A (AGM) (b):
5.80%, 11/01/15

 

 

8,685

 

 

10,219,292

 

New Jersey EDA, RB:

 

 

 

 

 

 

 

Cigarette Tax, 5.75%, 6/15/14 (b)

 

 

8,310

 

 

9,250,526

 

Continental Airlines Inc. Project, AMT, 6.63%,
9/15/12

 

 

5,540

 

 

5,626,036

 

Motor Vehicle Surcharge, Series A (NPFGC),
5.25%, 7/01/33

 

 

10,000

 

 

10,745,000

 

New Jersey EDA, Refunding RB:

 

 

 

 

 

 

 

New Jersey American Water Co., Series E, AMT,
4.70%, 12/01/25

 

 

3,000

 

 

3,234,450

 

School Facilities Construction, Series AA, 4.25%,
12/15/24

 

 

3,850

 

 

4,162,466

 

School Facilities Construction, Series EE, 5.00%,
9/01/23

 

 

3,465

 

 

4,044,071

 

 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

New Jersey (concluded)

 

 

 

 

 

 

 

New Jersey Health Care Facilities Financing Authority,
Refunding RB, Hackensack University Medical,
Series B (AGM), 4.00%, 1/01/24

 

$

635

 

$

675,507

 

New Jersey Higher Education Assistance Authority, RB,
Series 1, AMT:

 

 

 

 

 

 

 

5.50%, 12/01/26

 

 

1,665

 

 

1,847,201

 

5.00%, 12/01/27

 

 

12,000

 

 

12,707,160

 

New Jersey Higher Education Assistance Authority,
Refunding RB, 4.75%, 12/01/21

 

 

2,400

 

 

2,652,144

 

New Jersey State Housing & Mortgage Finance Agency,
RB, S/F Housing, Series X, AMT, 5.10%, 10/01/23

 

 

4,150

 

 

4,355,881

 

New Jersey Transportation Trust Fund Authority, RB,
Transportation System:

 

 

 

 

 

 

 

CAB, Series C (AMBAC), 5.73%, 12/15/25 (f)

 

 

9,450

 

 

5,085,990

 

Series A, 5.25%, 6/15/24

 

 

3,185

 

 

3,776,423

 

Series B, 5.50%, 6/15/31

 

 

10,000

 

 

11,567,300

 

South Jersey Port Corp., RB, Marine Terminal,
Series O-1 (AGC), 4.63%, 1/01/23

 

 

1,375

 

 

1,532,850

 

State of New Jersey, GO, Refunding, 5.25%, 8/01/21

 

 

1,355

 

 

1,722,638

 

 

 

 

 

 

 

95,494,455

 

New York — 20.7%

 

 

 

 

 

 

 

City of New York New York, GO:

 

 

 

 

 

 

 

Refunding, Series E, 5.00%, 8/01/27

 

 

3,500

 

 

3,970,890

 

Series D1, 5.13%, 12/01/26

 

 

4,615

 

 

5,365,630

 

Sub-Series I-1, 5.50%, 4/01/21

 

 

5,000

 

 

6,107,450

 

Essex County Industrial Development Agency, Refunding
RB, International Paper, Series A, AMT, 5.20%,
12/01/23

 

 

6,300

 

 

6,421,905

 

Hudson New York Yards Infrastructure Corp., RB,
5.75%, 2/15/47

 

 

4,250

 

 

4,796,422

 

Long Island Power Authority, Refunding RB, Series A,
5.50%, 4/01/24

 

 

1,475

 

 

1,731,503

 

Metropolitan Transportation Authority, RB:

 

 

 

 

 

 

 

Sub-Series B-1, 5.00%, 11/15/24

 

 

2,300

 

 

2,782,793

 

Sub-Series B-4, 5.00%, 11/15/24

 

 

1,500

 

 

1,814,865

 

Transportation, Series A, 5.00%, 11/15/25

 

 

1,980

 

 

2,220,728

 

Metropolitan Transportation Authority, Refunding RB,
Series B, 5.25%, 11/15/25

 

 

4,000

 

 

4,681,320

 

New York City Industrial Development Agency, RB:

 

 

 

 

 

 

 

Continental Airlines Inc. Project, Mandatory Put
Bonds, AMT, 8.38%, 11/01/16

 

 

3,500

 

 

3,527,825

 

Special Needs Facilities Pooled Program, Series C-1,
6.80%, 7/01/19

 

 

1,770

 

 

1,797,665

 

New York City Industrial Development Agency, Refunding
RB, New York Stock Exchange Project, Series A,
4.25%, 5/01/24

 

 

1,740

 

 

1,884,455

 

New York City Transitional Finance Authority, RB:

 

 

 

 

 

 

 

Fiscal 2007, Series S-1 (NPFGC), 5.00%, 7/15/24

 

 

500

 

 

555,485

 

Fiscal 2009, Series S-3, 5.00%, 1/15/23

 

 

3,560

 

 

4,146,296

 

New York City Trust for Cultural Resources, RB, Carnegie
Hall, Series A, 5.00%, 12/01/29

 

 

3,750

 

 

4,116,562

 

New York Liberty Development Corp., Refunding RB,
Second Priority, Bank of America Tower at One Bryant
Park Project, 5.63%, 7/15/47

 

 

3,000

 

 

3,264,390

 

New York State Dormitory Authority, LRB, Municipal
Health Facilities, Sub-Series 2-4, 5.00%, 1/15/27

 

 

6,900

 

 

7,565,643

 

New York State Dormitory Authority, RB:

 

 

 

 

 

 

 

Education, Series D, 5.00%, 3/15/31

 

 

4,500

 

 

5,048,685

 

Fordham University, Series A, 5.25%, 7/01/25

 

 

900

 

 

1,057,302

 

Mental Health Services Facilities Improvement,
Series A (AGM), 5.00%, 2/15/22

 

 

4,000

 

 

4,616,200

 

Mount Sinai School of Medicine, Series A (NPFGC),
5.15%, 7/01/24

 

 

1,000

 

 

1,149,670

 

North Shore-Long Island Jewish Health System,
Series A, 5.50%, 5/01/30

 

 

1,495

 

 

1,663,576

 


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

 

40

ANNUAL REPORT

APRIL 30, 2012

 




 

 

 

 

Schedule of Investments (continued)

BlackRock Muni Intermediate Duration Fund, Inc. (MUI)
(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

New York (concluded)

 

 

 

 

 

 

 

New York State Dormitory Authority, RB (concluded):

 

 

 

 

 

 

 

NYU Hospital Center, Series A, 5.00%, 7/01/22

 

$

1,725

 

$

1,888,772

 

NYU Hospital Center, Series A, 5.13%, 7/01/23

 

 

1,670

 

 

1,822,221

 

University of Rochester, Series C, 4.00%, 7/01/24

 

 

625

 

 

668,363

 

New York State Dormitory Authority, Refunding RB:

 

 

 

 

 

 

 

Mount Sinai Hospital, Series A, 4.25%, 7/01/23

 

 

2,225

 

 

2,358,010

 

North Shore-Long Island Jewish Health System,
Series E, 5.00%, 5/01/22

 

 

650

 

 

737,887

 

North Shore-Long Island Jewish Health System,
Series E, 5.00%, 5/01/23

 

 

2,160

 

 

2,421,468

 

Yeshiva University, 4.00%, 9/01/23

 

 

2,860

 

 

3,024,364

 

Yeshiva University, 4.25%, 9/01/24

 

 

2,750

 

 

2,922,562

 

New York State Urban Development Corp., Refunding
RB, Service Contract, Series B, 5.00%, 1/01/21

 

 

8,000

 

 

9,265,440

 

Port Authority of New York & New Jersey, RB, JFK
International Air Terminal, 5.00%, 12/01/20

 

 

2,475

 

 

2,613,674

 

Port Authority of New York & New Jersey, Refunding
RB, Consolidated:

 

 

 

 

 

 

 

152nd Series, AMT, 5.00%, 11/01/23

 

 

1,000

 

 

1,120,960

 

153rd Series, 5.00%, 7/15/24

 

 

2,010

 

 

2,288,807

 

Sales Tax Asset Receivable Corp., RB, Series A (NPFGC),
5.00%, 10/15/20

 

 

6,570

 

 

7,269,771

 

United Nations Development Corp. New York, Refunding
RB, Series A, 4.25%, 7/01/24

 

 

2,985

 

 

3,232,994

 

Westchester County New York Health Care Corp., RB,
Senior Lien, Series A, 5.00%, 11/01/24

 

 

5,470

 

 

5,932,653

 

 

 

 

 

 

 

127,855,206

 

North Carolina — 2.0%

 

 

 

 

 

 

 

City of Charlotte North Carolina, RB, Charlotte Douglas
Airport, Series A, 5.00%, 7/01/33

 

 

4,000

 

 

4,450,360

 

Gaston County Industrial Facilities & Pollution Control
Financing Authority North Carolina, RB, Exempt
Facilities, National Gypsum Co. Project, AMT,
5.75%, 8/01/35

 

 

2,105

 

 

1,769,905

 

North Carolina Capital Facilities Finance Agency, RB,
Solid Waste Disposal, Duke Energy Carolinas Project,
Series B, 4.38%, 10/01/31

 

 

2,000

 

 

2,092,420

 

North Carolina Eastern Municipal Power Agency,
Refunding RB, Series B, 5.00%, 1/01/26

 

 

1,925

 

 

2,144,989

 

North Carolina Medical Care Commission, Refunding
RB, Vidant Health, Series A, 5.00%, 6/01/36 (c)

 

 

1,500

 

 

1,600,335

 

 

 

 

 

 

 

12,058,009

 

Ohio — 0.5%

 

 

 

 

 

 

 

Cincinnati City School District, GO, Refunding, School
Improvement, 5.25%, 6/01/24

 

 

1,825

 

 

2,176,331

 

City of Cincinnati Ohio, GO, Various Purpose, Series A,
4.38%, 12/01/30

 

 

900

 

 

952,659

 

 

 

 

 

 

 

3,128,990

 

Oregon — 1.3%

 

 

 

 

 

 

 

City of Tigard Washington County Oregon, Refunding
RB, Water System, 5.00%, 8/01/37 (c)

 

 

2,000

 

 

2,234,540

 

Oregon State Facilities Authority, RB, Reed College
Project, Series A, 5.00%, 7/01/29

 

 

1,835

 

 

2,113,443

 

State of Oregon, GO:

 

 

 

 

 

 

 

Odot Project, Tax-Exempt, Series I, 5.00%, 5/01/37

 

 

1,000

 

 

1,140,170

 

Series H, 5.00%, 5/01/36

 

 

2,000

 

 

2,282,180

 

 

 

 

 

 

 

7,770,333

 

 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Pennsylvania — 9.1%

 

 

 

 

 

 

 

City of Philadelphia Pennsylvania, RB, Series A, AMT
(AGM), 5.00%, 6/15/20

 

$

2,895

 

$

3,154,710

 

City of Philadelphia Pennsylvania, Refunding RB,
Series B, AMT (AGM), 5.00%, 6/15/19

 

 

3,905

 

 

4,301,592

 

City of Pittsburgh Pennsylvania, GO, Series C (AGM),
5.25%, 9/01/18

 

 

6,430

 

 

7,207,516

 

City of Pittsburgh Pennsylvania, GO, Refunding, Series B
(AGM), 5.25%, 9/01/17

 

 

9,630

 

 

10,884,982

 

County of Allegheny Pennsylvania, GO:

 

 

 

 

 

 

 

Series C-67, 5.00%, 11/01/25

 

 

2,700

 

 

3,045,249

 

Series C-67, 5.00%, 11/01/26

 

 

2,375

 

 

2,652,139

 

Series C-68, 5.00%, 11/01/25

 

 

2,515

 

 

2,836,593

 

Montgomery County IDA Pennsylvania, MRB, Whitemarsh
Continuing Care, 6.00%, 2/01/21

 

 

3,500

 

 

3,497,270

 

Pennsylvania Economic Development Financing
Authority, RB, National Gypsum Co., Series A, AMT,
6.25%, 11/01/27

 

 

7,710

 

 

6,999,061

 

Pennsylvania Turnpike Commission, RB, Sub-Series B,
5.25%, 12/01/31

 

 

4,000

 

 

4,435,080

 

South Fork Municipal Authority, Refunding RB,
Conemaugh Valley Memorial, Series A (AGC),
6.00%, 7/01/26

 

 

6,225

 

 

7,238,056

 

 

 

 

 

 

 

56,252,248

 

Puerto Rico — 5.2%

 

 

 

 

 

 

 

Puerto Rico Aqueduct & Sewer Authority, RB, Senior
Lien, Series A (AGC), 5.00%, 7/01/25

 

 

3,215

 

 

3,414,330

 

Puerto Rico Electric Power Authority, RB, Series TT,
5.00%, 7/01/27

 

 

6,500

 

 

6,791,200

 

Puerto Rico Highway & Transportation Authority, RB,
Series Y (AGM), 6.25%, 7/01/21

 

 

3,000

 

 

3,588,270

 

Puerto Rico Highway & Transportation Authority,
Refunding RB, Series AA-1 (AGM), 4.95%, 7/01/26

 

 

885

 

 

944,322

 

Puerto Rico Housing Finance Authority, Refunding RB,
Subordinate, Capital Fund Modernization, 5.13%,
12/01/27

 

 

9,450

 

 

10,225,845

 

Puerto Rico Sales Tax Financing Corp., RB:

 

 

 

 

 

 

 

First Sub-Series A, 5.63%, 8/01/30

 

 

1,925

 

 

2,036,534

 

First Sub-Series A, 6.00%, 8/01/42

 

 

650

 

 

733,278

 

Series C, 5.25%, 8/01/40

 

 

3,800

 

 

4,157,960

 

 

 

 

 

 

 

31,891,739

 

Rhode Island — 0.8%

 

 

 

 

 

 

 

Rhode Island Health & Educational Building Corp., RB:

 

 

 

 

 

 

 

Providence College, 5.00%, 11/01/34

 

 

1,750

 

 

1,881,478

 

University of Rhode Island, Series A (AGC), 4.75%,
9/15/24

 

 

2,500

 

 

2,792,350

 

 

 

 

 

 

 

4,673,828

 

South Carolina — 0.2%

 

 

 

 

 

 

 

County of Florence South Carolina, RB, McLeod
Regional Medical Center, Series A, 4.50%, 11/01/25

 

 

1,000

 

 

1,069,810

 

South Dakota — 0.2%

 

 

 

 

 

 

 

South Dakota Health & Educational Facilities Authority,
RB, Regional Health, 5.00%, 9/01/25

 

 

1,000

 

 

1,094,500

 

Tennessee — 2.7%

 

 

 

 

 

 

 

Chattanooga-Hamilton County Hospital Authority
Tennessee, Refunding RB, Erlanger Health (AGM),
5.00%, 10/01/22

 

 

1,620

 

 

1,854,317

 

Johnson City Health & Educational Facilities Board, RB,
Appalachian Christian Village Project, Series A,
6.00%, 2/15/19

 

 

1,360

 

 

1,360,653

 

Knox County Health Educational & Housing Facilities
Board Tennessee, Refunding RB, Eastowne Village
Project, 4.00%, 6/01/21 (a)

 

 

3,870

 

 

4,179,871

 


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

41




 

 

 

 

Schedule of Investments (continued)

BlackRock Muni Intermediate Duration Fund, Inc. (MUI)
(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Tennessee (concluded)

 

 

 

 

 

 

 

Memphis-Shelby County Sports Authority Inc.,
Refunding RB, Memphis Arena Project:

 

 

 

 

 

 

 

Series A, 5.00%, 11/01/23

 

$

2,695

 

$

3,044,676

 

Series B, 5.00%, 11/01/22

 

 

1,000

 

 

1,134,550

 

Shelby County Health Educational & Housing Facilities
Board, RB, Germantown Village, Series A:

 

 

 

 

 

 

 

6.75%, 12/01/18

 

 

3,550

 

 

3,573,501

 

7.00%, 12/01/23

 

 

1,450

 

 

1,455,684

 

 

 

 

 

 

 

16,603,252

 

Texas — 3.9%

 

 

 

 

 

 

 

City of Houston Texas, Refunding ARB, Sub-Lien, Series A,
AMT, 5.00%, 7/01/25

 

 

1,500

 

 

1,663,320

 

City of Houston TX Airport System, Refunding RB,
Subordinate Lien, Series A, AMT, 5.00%, 7/01/32

 

 

1,010

 

 

1,091,022

 

Dallas-Fort Worth International Airport Facilities
Improvement Corp., RB, Series 2001-A-1, AMT,
6.15%, 1/01/16

 

 

4,000

 

 

4,005,480

 

Frisco ISD, GO, Refunding (NPFGC), 4.25%, 8/15/28

 

 

5,500

 

 

6,067,765

 

Grand Prairie ISD, GO, Refunding, 4.00%, 2/15/26

 

 

1,500

 

 

1,644,900

 

Gulf Coast IDA, RB, Citgo Petroleum Corp. Project,
Mandatory Put Bonds, AMT, 7.50%, 5/01/25 (a)

 

 

2,440

 

 

2,464,620

 

San Jacinto River Authority, RB, Special Project,
5.25%, 10/01/25

 

 

2,910

 

 

3,311,434

 

Socorro ISD, GO, Refunding:

 

 

 

 

 

 

 

5.00%, 8/15/30

 

 

1,000

 

 

1,146,600

 

5.00%, 8/15/32

 

 

2,500

 

 

2,840,925

 

 

 

 

 

 

 

24,236,066

 

Vermont — 0.3%

 

 

 

 

 

 

 

Vermont Educational & Health Buildings Financing
Agency, Refunding RB, Middlebury College Project,
5.00%, 11/01/32

 

 

1,680

 

 

1,946,314

 

Virginia — 2.7%

 

 

 

 

 

 

 

James City County EDA, Refunding RB, First Mortgage,
Williamsburg Lodge, Series A:

 

 

 

 

 

 

 

5.75%, 3/01/17

 

 

3,285

 

 

3,301,326

 

6.00%, 3/01/23

 

 

1,150

 

 

1,152,116

 

Roanoke Economic Development Authority, Refunding
RB, Carilion Health System, Series B (AGM):

 

 

 

 

 

 

 

5.00%, 7/01/20 (b)

 

 

50

 

 

62,470

 

5.00%, 7/01/38

 

 

3,155

 

 

3,366,070

 

Tobacco Settlement Financing Corp. Virginia, RB,
Asset-Backed, 5.63%, 6/01/15 (b)

 

 

7,800

 

 

8,993,244

 

 

 

 

 

 

 

16,875,226

 

West Virginia — 2.7%

 

 

 

 

 

 

 

West Virginia Hospital Finance Authority, Refunding RB,
Charleston, Series A, 5.13%, 9/01/23

 

 

4,000

 

 

4,316,960

 

West Virginia University, RB, Board of Governors
University Improvement, Series B:

 

 

 

 

 

 

 

5.00%, 10/01/29

 

 

7,520

 

 

8,573,702

 

5.00%, 10/01/30

 

 

3,500

 

 

3,975,230

 

 

 

 

 

 

 

16,865,892

 

Wisconsin — 1.0%

 

 

 

 

 

 

 

Wisconsin Health & Educational Facilities Authority, RB,
Aurora Health Care Inc., Series A (AGM), 5.00%,
7/15/27

 

 

3,770

 

 

4,138,518

 

Wisconsin Housing & EDA, RB, Series C, AMT, 4.85%,
9/01/26

 

 

2,000

 

 

2,064,480

 

 

 

 

 

 

 

6,202,998

 

Total Municipal Bonds — 134.1%

 

 

 

 

 

827,822,655

 

 

 

 

 

 

 

 

 

Municipal Bonds Transferred to
Tender Option Bond Trusts (g)

 

Par
(000)

 

Value

 

California — 3.3%

 

 

 

 

 

 

 

Peralta Community College District, GO, Election of
2000, Series D (AGM), 5.00%, 8/01/30

 

$

10,140

 

$

10,693,441

 

Sequoia Union High School District California, GO,
Refunding, Election of 2004, Series B (AGM),
5.50%, 7/01/35

 

 

9,028

 

 

9,766,490

 

 

 

 

 

 

 

20,459,931

 

Illinois — 3.8%

 

 

 

 

 

 

 

Du Page & Will Counties Community School District
No. 204 Indian, GO, School Building, Series A
(NPFGC), 5.25%, 12/30/22

 

 

8,650

 

 

9,858,899

 

McHenry County Conservation District Illinois, GO
(AGM), 5.13%, 2/01/27

 

 

12,695

 

 

13,805,668

 

 

 

 

 

 

 

23,664,567

 

Massachusetts — 3.3%

 

 

 

 

 

 

 

Massachusetts Development Finance Agency, RB,
Partners Healthcare, Series L, 5.00%, 7/01/31

 

 

10,175

 

 

11,422,246

 

Massachusetts School Building Authority, Sales Tax RB,
Series A (AGM), 5.00%, 8/15/30

 

 

8,338

 

 

9,224,026

 

 

 

 

 

 

 

20,646,272

 

Minnesota — 1.9%

 

 

 

 

 

 

 

State of Minnesota, GO, State Various Purpose, Series A,
4.00%, 8/01/29

 

 

10,525

 

 

11,711,992

 

New Jersey — 2.0%

 

 

 

 

 

 

 

New Jersey Transportation Trust Fund Authority, RB,
Transportation System, Series D (AGM), 5.00%,
6/15/19

 

 

11,120

 

 

12,218,100

 

New York — 9.0%

 

 

 

 

 

 

 

City of New York New York, GO:

 

 

 

 

 

 

 

Series E, 5.00%, 8/01/24

 

 

3,990

 

 

4,642,605

 

Sub-Series B-1, 5.25%, 9/01/22

 

 

8,250

 

 

9,750,180

 

New York City Municipal Water & Sewer Finance
Authority, Refunding RB, Series A, 4.75%, 6/15/30

 

 

8,000

 

 

8,746,240

 

New York State Urban Development Corp., RB, State
Personal Income Tax, State Facilities, Series A-1
(NPFGC), 5.25%, 3/15/34

 

 

10,000

 

 

10,608,300

 

Port Authority of New York & New Jersey, RB,
Consolidated, 169th Series, AMT, 5.00%, 10/15/26

 

 

5,530

 

 

6,221,416

 

Sales Tax Asset Receivable Corp., RB, Series A (AMBAC),
5.25%, 10/15/27

 

 

11,101

 

 

12,175,934

 

Suffolk County Water Authority, Refunding RB, New York
Water System, 3.00%, 6/01/25

 

 

3,242

 

 

3,295,935

 

 

 

 

 

 

 

55,440,610

 

Washington — 1.9%

 

 

 

 

 

 

 

Snohomish County School District No. 15 — Edmonds
Washington, GO, (NPFGC), 5.00%, 12/01/19

 

 

10,000

 

 

11,516,800

 

Total Municipal Bonds Transferred to
Tender Option Bond Trusts — 25.2%

 

 

 

 

 

155,658,272

 

Total Long-Term Investments
(Cost — $913,600,488) — 159.3%

 

 

 

 

 

983,480,927

 


 

 

 

See Notes to Financial Statements.

 

 

 

42

ANNUAL REPORT

APRIL 30, 2012




 

 

 

 

Schedule of Investments (concluded)

BlackRock Muni Intermediate Duration Fund, Inc. (MUI)

(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Short-Term Securities

 

Shares

 

 

Value

 

FFI Institutional Tax-Exempt Fund, 0.09% (h)(i)

 

 

3,601

 

$

3,601,217

 

Total Short-Term Securities
(Cost — $3,601,217) — 0.6%

 

 

 

 

 

3,601,217

 

Total Investments (Cost — $917,201,705) — 159.9%

 

 

 

 

 

987,082,144

 

Liabilities in Excess of Other Assets — (0.2)%

 

 

 

 

 

(1,078,578

)

Liability for TOB Trust Certificates, Including
Interest Expense and Fees Payable — (13.2)%

 

 

 

 

 

(81,466,452

)

VRDP Shares, at Liquidation Value — (46.5)%

 

 

 

 

 

(287,100,000

)

Net Assets Applicable to Common Shares — 100.0%

 

 

 

 

$

617,437,114

 


 

 

 

 

(a)

Variable rate security. Rate shown is as of report date.

 

 

(b)

US government securities, held in escrow, are used to pay interest on this security, as well as to retire the bond in full at the date indicated, typically at a premium to par.

 

 

(c)

When-issued security. Unsettled when-issued transactions were as follows:


 

 

 

 

 

 

 

 

Counterparty

 

Value

 

Unrealized
Appreciation

 

Citigroup Global

 

$

9,792,615

 

$

30,081

 

Goldman Sachs

 

$

1,280,015

 

$

9,371

 

Wells Fargo Securities

 

$

2,234,540

 

$

23,540

 


 

 

(d)

Non-income producing security.

 

 

(e)

Issuer filed for bankruptcy and/or is in default of interest payments.

 

 

(f)

Represents a zero-coupon bond. Rate shown reflects the current yield as of report date.

 

 

(g)

Securities represent bonds transferred to a TOB in exchange for which the Fund acquired residual interest certificates. These securities serve as collateral in a financing transaction. See Note 1 of the Notes to Financial Statements for details of municipal bonds transferred to TOBs.

 

 

(h)

Investments in companies considered to be an affiliate of the Fund during the year, for purposes of Section 2(a)(3) of the 1940 Act, as amended, were as follows:


 

 

 

 

 

 

 

 

 

 

 

 

 

 

Affiliate

 

Shares
Held at
April 30,
2011

 

Net
Activity

 

Shares
Held at
April 30,
2012

 

Income

 

FFI Institutional Tax-Exempt Fund

 

 

9,713,431

 

 

(6,112,214

)

 

3,601,217

 

$

4,294

 


 

 

(i)

Represents the current yield as of report date.

 

 

Financial futures contracts sold as of April 30, 2012 were as follows:


 

 

 

 

 

 

 

 

 

 

 

 

 

 

Contracts

 

Issue

 

Exchange

 

Expiration

 

Notional
Value

 

Unrealized
Depreciation

 

    720

 

10-Year US

 

Chicago Board

 

June 2012

 

$

95,242,500

 

$

(1,393,556

)

 

 

Treasury Note

 

of Trade

 

 

 

 

 

 

 

 

 


 

 

 

Fair Value Measurements — Various inputs are used in determining the fair value of investments and derivative financial instruments. These inputs are categorized into a disclosure hierarchy consisting of three broad levels for financial statement purposes as follows:

 

 

 

 

Level 1 — unadjusted price quotations in active markets/exchanges for identical assets and liabilities

 

 

 

 

Level 2 — other observable inputs (including, but not limited to: quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs)

 

 

 

 

Level 3 — unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Fund’s own assumptions used in determining the fair value of investments and derivative financial instruments)

Changes in valuation techniques may result in transfers into or out of an assigned level within the disclosure hierarchy. The categorization of a value determined for investments and derivative financial instruments is based on the pricing transparency of the investment and derivative financial instrument and is not necessarily an indication of the risks associated with investing in those securities. For information about the Fund’s policy regarding valuation of investments and derivative financial instruments and other significant accounting policies, please refer to Note 1 of the Notes to Financial Statements. The following tables summarize the inputs used as of April 30, 2012 in determining the fair valuation of the Fund’s investments and derivative financial instruments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Valuation Inputs

 

Level 1

 

Level 2

 

Level 3

 

Total

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

Investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

Long-Term
Investments1

 

 

 

$

983,480,927

 

 

 

$

983,480,927

 

Short-Term
Securities

 

$

3,601,217

 

 

 

 

 

 

3,601,217

 

Total

 

$

3,601,217

 

$

983,480,927

 

 

 

$

987,082,144

 


 

 

 

 

1

See above Schedule of Investments for values in each state or political subdivision.


 

 

 

 

 

 

 

 

 

 

 

 

 

 

Valuation Inputs

 

Level 1

 

Level 2

 

Level 3

 

Total

 

Derivative Financial
Instruments2

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest rate
contracts

 

$

(1,393,556

)

 

 

 

 

$

(1,393,556

)


 

 

 

 

2

Derivative financial instruments are financial futures contracts, which are valued at the unrealized appreciation/depreciation on the instrument.


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

43




 

 

 

 

Schedule of Investments April 30, 2012

BlackRock MuniVest Fund II, Inc. (MVT)

(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Alabama — 1.3%

 

 

 

 

 

 

 

County of Jefferson Alabama, RB, Series A, 5.25%,
1/01/19

 

$

1,490

 

$

1,470,139

 

Prattville IDB Alabama, RB, International Paper Co.
Project, Series A, AMT, 4.75%, 12/01/30

 

 

3,025

 

 

2,991,392

 

 

 

 

 

 

 

4,461,531

 

Alaska — 1.1%

 

 

 

 

 

 

 

Northern Tobacco Securitization Corp., Refunding RB,
Tobacco Settlement, Asset-Backed, Series A:

 

 

 

 

 

 

 

4.63%, 6/01/23

 

 

1,860

 

 

1,840,061

 

5.00%, 6/01/46

 

 

2,250

 

 

1,703,385

 

 

 

 

 

 

 

3,543,446

 

Arizona — 0.9%

 

 

 

 

 

 

 

Maricopa County IDA, RB, Arizona Charter Schools
Project, Series A, 6.75%, 7/01/29

 

 

1,000

 

 

689,350

 

Pima County IDA, RB:

 

 

 

 

 

 

 

6.75%, 7/01/21

 

 

310

 

 

310,366

 

Arizona Charter Schools Project, Series C, 6.75%,
7/01/31

 

 

1,900

 

 

1,900,380

 

Pima County IDA, Refunding RB, Charter Schools,
6.75%, 7/01/21

 

 

155

 

 

156,719

 

 

 

 

 

 

 

3,056,815

 

California — 13.0%

 

 

 

 

 

 

 

California Health Facilities Financing Authority, RB,
Sutter Health, Series B, 6.00%, 8/15/42

 

 

3,170

 

 

3,715,969

 

California Health Facilities Financing Authority,
Refunding RB, St. Joseph Health System, Series A,
5.75%, 7/01/39

 

 

2,200

 

 

2,490,488

 

California State Public Works Board, RB, Various Capital
Projects, Sub-Series I-1, 6.38%, 11/01/34

 

 

1,185

 

 

1,383,843

 

California Statewide Communities Development
Authority, RB, Kaiser Permanente, Series A, 5.00%,
4/01/42

 

 

2,200

 

 

2,347,026

 

City of Los Angeles Department of Airports, RB, Series A,
5.25%, 5/15/39

 

 

800

 

 

881,448

 

City of Los Angeles Department of Airports, Refunding
RB, Senior, Los Angeles International Airport,
Series A, 5.00%, 5/15/40

 

 

5,930

 

 

6,440,395

 

San Marcos Unified School District, CAB, GO, Election
of 2010, Series B (a)(b):

 

 

 

 

 

 

 

5.61%, 8/01/41

 

 

5,000

 

 

1,016,700

 

5.62%, 8/01/42

 

 

2,000

 

 

384,000

 

State of California, GO, Various Purpose:

 

 

 

 

 

 

 

6.00%, 3/01/33

 

 

2,525

 

 

3,003,765

 

6.50%, 4/01/33

 

 

14,925

 

 

18,187,605

 

5.00%, 10/01/41

 

 

3,050

 

 

3,247,884

 

 

 

 

 

 

 

43,099,123

 

Colorado — 1.9%

 

 

 

 

 

 

 

Colorado Health Facilities Authority, RB, Catholic Health
Initiatives, Series D, 6.25%, 10/01/33

 

 

1,060

 

 

1,236,872

 

Colorado Housing & Finance Authority, Refunding RB,
S/F Program, Senior Series A-2, AMT, 7.50%,
4/01/31

 

 

60

 

 

60,353

 

Plaza Metropolitan District No. 1 Colorado, Tax Allocation
Bonds, Public Improvement Fee, Tax Increment:

 

 

 

 

 

 

 

8.00%, 12/01/25

 

 

3,300

 

 

3,408,735

 

Subordinate, 8.13%, 12/01/25

 

 

820

 

 

803,067

 

University of Colorado, RB, Series A, 5.75%, 6/01/28

 

 

750

 

 

926,017

 

 

 

 

 

 

 

6,435,044

 


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Connecticut — 1.8%

 

 

 

 

 

 

 

Connecticut State Health & Educational Facility
Authority, RB:

 

 

 

 

 

 

 

Ascension Health Senior Credit, 5.00%, 11/15/40

 

$

1,375

 

$

1,479,486

 

Wesleyan University, 5.00%, 7/01/35

 

 

3,385

 

 

3,765,779

 

Mohegan Tribe of Indians of Connecticut, RB, Public
Improvement, Priority Distribution, 6.25%, 1/01/31

 

 

950

 

 

829,445

 

 

 

 

 

 

 

6,074,710

 

Delaware — 1.6%

 

 

 

 

 

 

 

County of Sussex Delaware, RB, NRG Energy, Inc.,
Indian River Project, 6.00%, 10/01/40

 

 

1,125

 

 

1,218,172

 

Delaware State EDA, RB, Exempt Facilities, Indian River
Power, 5.38%, 10/01/45

 

 

4,065

 

 

4,196,747

 

 

 

 

 

 

 

5,414,919

 

District of Columbia — 2.1%

 

 

 

 

 

 

 

Metropolitan Washington Airports Authority, RB:

 

 

 

 

 

 

 

CAB, Second Senior Lien, Series B (AGC), 7.05%,
10/01/33 (a)

 

 

6,590

 

 

2,096,543

 

CAB, Second Senior Lien, Series B (AGC), 7.08%,
10/01/34 (a)

 

 

4,830

 

 

1,437,649

 

CAB, Second Senior Lien, Series B (AGC), 7.10%,
10/01/35 (a)

 

 

6,515

 

 

1,816,317

 

First Senior Lien, Series A, 5.25%, 10/01/44

 

 

1,500

 

 

1,614,315

 

 

 

 

 

 

 

6,964,824

 

Florida — 3.8%

 

 

 

 

 

 

 

County of Miami-Dade Florida, Refunding RB, Miami
International Airport:

 

 

 

 

 

 

 

AMT (AGC), 5.00%, 10/01/40

 

 

2,225

 

 

2,274,684

 

Series A-1, 5.38%, 10/01/41

 

 

1,165

 

 

1,287,278

 

Fiddlers Creek Community Development District No. 2,
Special Assessment Bonds, Series A, 6.38%,
5/01/35 (c)(d)

 

 

2,350

 

 

1,234,855

 

Hillsborough County IDA, RB, National Gypsum Co.,
Series B, AMT, 7.13%, 4/01/30

 

 

2,720

 

 

2,692,392

 

Mid-Bay Bridge Authority, RB, Series A, 7.25%,
10/01/40

 

 

2,265

 

 

2,625,520

 

Midtown Miami Community Development District,
Special Assessment Bonds, Series A, 6.25%,
5/01/37

 

 

915

 

 

923,208

 

Palm Coast Park Community Development District,
Special Assessment Bonds, 5.70%, 5/01/37

 

 

1,175

 

 

763,797

 

Preserve at Wilderness Lake Community Development
District, RB, Series A, 7.10%, 5/01/33

 

 

840

 

 

848,551

 

 

 

 

 

 

 

12,650,285

 

Georgia — 4.2%

 

 

 

 

 

 

 

DeKalb Private Hospital Authority, Refunding RB,
Children’s Healthcare, 5.25%, 11/15/39

 

 

130

 

 

140,575

 

Fulton County Residential Care Facilities for the Elderly
Authority, Refunding RB, Canterbury Court Project,
Series A, 6.13%, 2/15/26

 

 

2,000

 

 

1,995,180

 

Metropolitan Atlanta Rapid Transit Authority, RB, Sales
Tax, Third Indenture Series A, 5.00%, 7/01/39

 

 

3,465

 

 

3,759,837

 

Municipal Electric Authority of Georgia, RB:

 

 

 

 

 

 

 

Series W, 6.60%, 1/01/18 (e)(f)

 

 

380

 

 

406,144

 

Series W, 6.60%, 1/01/18

 

 

5,520

 

 

6,225,898

 

Series X, 6.50%, 1/01/20

 

 

1,205

 

 

1,427,551

 

 

 

 

 

 

 

13,955,185

 

Hawaii — 0.5%

 

 

 

 

 

 

 

State of Hawaii, Refunding RB, Series A, 5.25%,
7/01/30

 

 

1,355

 

 

1,494,809

 


 

 

 

 

See Notes to Financial Statements.

 

44

ANNUAL REPORT

APRIL 30, 2012




 

 

 

 

Schedule of Investments (continued)

BlackRock MuniVest Fund II, Inc. (MVT)
(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

 

Value

 

Illinois — 16.2%

 

 

 

 

 

 

 

Chicago Board of Education Illinois, GO, Series A:

 

 

 

 

 

 

 

5.50%, 12/01/39

 

$

2,110

 

$

2,384,996

 

5.00%, 12/01/41

 

 

695

 

 

747,570

 

City of Chicago Illinois, RB, O’Hare International Airport,
General, Third Lien, Series C (AGM), 6.50%, 1/01/41

 

 

5,865

 

 

7,034,540

 

City of Chicago Illinois, Refunding RB, Sales Tax,
Series A, 5.25%, 1/01/38

 

 

820

 

 

912,611

 

City of Chicago Illinois, Special Assessment Bonds,
Lake Shore East, 6.75%, 12/01/32

 

 

800

 

 

838,320

 

City of Chicago Illinois, Tax Allocation Bonds, Kingsbury
Redevelopment Project, Series A, 6.57%, 2/15/13

 

 

300

 

 

300,162

 

City of Chicago Illinois Transit Authority, RB, Sales Tax
Receipts, 5.25%, 12/01/40

 

 

1,050

 

 

1,164,209

 

Illinois Finance Authority, RB:

 

 

 

 

 

 

 

Advocate Health Care Network, Series D, 6.50%,
11/01/38

 

 

5,000

 

 

5,777,600

 

Community Rehabilitation Providers Facilities,
Series A, 6.50%, 7/01/22

 

 

530

 

 

540,960

 

Community Rehabilitation Providers Facilities,
Series A, 6.50%, 7/01/22

 

 

470

 

 

429,420

 

Navistar International, Recovery Zone, 6.50%,
10/15/40

 

 

1,540

 

 

1,666,249

 

Illinois Finance Authority, Refunding RB:

 

 

 

 

 

 

 

Ascension Health, Series A, 5.00%, 11/15/37 (b)

 

 

970

 

 

1,054,322

 

Ascension Health, Series A, 5.00%, 11/15/42 (b)

 

 

1,765

 

 

1,908,194

 

Central DuPage Health, Series B, 5.50%, 11/01/39

 

 

1,610

 

 

1,761,920

 

Friendship Village of Schaumburg, Series A, 5.63%,
2/15/37

 

 

250

 

 

225,620

 

Metropolitan Pier & Exposition Authority, Refunding RB,
McCormick Place Expansion Project (AGM):

 

 

 

 

 

 

 

Series B, 5.00%, 6/15/50

 

 

3,150

 

 

3,281,072

 

Series B-2, 5.00%, 6/15/50

 

 

2,500

 

 

2,603,150

 

Railsplitter Tobacco Settlement Authority, RB:

 

 

 

 

 

 

 

5.50%, 6/01/23

 

 

1,335

 

 

1,525,598

 

6.00%, 6/01/28

 

 

1,140

 

 

1,293,626

 

Regional Transportation Authority, RB:

 

 

 

 

 

 

 

Series A (AMBAC), 7.20%, 11/01/20

 

 

1,260

 

 

1,525,910

 

Series A (NPFGC), 6.70%, 11/01/21

 

 

7,000

 

 

8,434,930

 

Series C (NPFGC), 7.75%, 6/01/20

 

 

2,500

 

 

3,126,675

 

State of Illinois, RB, Build Illinois, Series B, 5.25%,
6/15/34

 

 

630

 

 

693,126

 

Village of Hodgkins Illinois, RB, MBM Project, AMT,
6.00%, 11/01/23

 

 

2,800

 

 

2,802,660

 

Village of Wheeling Illinois, Tax Allocation Bonds, North
Milwaukee/Lake-Cook TIF Project, 6.00%, 1/01/25

 

 

1,450

 

 

1,423,407

 

 

 

 

 

 

 

53,456,847

 

Indiana — 2.4%

 

 

 

 

 

 

 

Indiana Finance Authority, RB:

 

 

 

 

 

 

 

Parkview Health System, Series A, 5.75%, 5/01/31

 

 

3,295

 

 

3,648,389

 

Sisters of St. Francis Health, 5.25%, 11/01/39

 

 

840

 

 

903,538

 

Wastewater Utility, First Lien, CWA Authority Project,
Series A, 5.25%, 10/01/38

 

 

1,580

 

 

1,761,257

 

Indiana Finance Authority, Refunding RB, Ascension
Health Senior Credit, Series B-5, 5.00%, 11/15/36

 

 

1,500

 

 

1,568,685

 

 

 

 

 

 

 

7,881,869

 

Iowa — 0.7%

 

 

 

 

 

 

 

Iowa Student Loan Liquidity Corp., Refunding RB, Senior
Series A-1, AMT, 5.15%, 12/01/22

 

 

1,950

 

 

2,169,122

 

Kansas — 0.5%

 

 

 

 

 

 

 

Kansas Development Finance Authority, Refunding RB,
Sisters of Leavenworth, Series A, 5.00%, 1/01/40

 

 

1,660

 

 

1,768,614

 


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Kentucky — 0.3%

 

 

 

 

 

 

 

Kentucky Economic Development Finance Authority, RB,
Owensboro Medical Health System, Series A, 6.38%,
6/01/40

 

$

1,010

 

$

1,155,531

 

Louisiana — 4.5%

 

 

 

 

 

 

 

Louisiana Local Government Environmental Facilities &
Community Development Authority, RB, Westlake
Chemical Corp., Series A-1, 6.50%, 11/01/35

 

 

3,320

 

 

3,726,268

 

Port of New Orleans Louisiana, Refunding RB,
Continental Grain Co. Project, 6.50%, 1/01/17

 

 

7,500

 

 

7,509,600

 

Sabine River Authority Louisiana, Refunding RB,
International Paper Co. Project, 6.20%, 2/01/25

 

 

3,600

 

 

3,627,612

 

 

 

 

 

 

 

14,863,480

 

Maine — 0.3%

 

 

 

 

 

 

 

Maine State Turnpike Authority, RB, Series A, 5.00%,
7/01/42

 

 

885

 

 

988,085

 

Maryland — 2.7%

 

 

 

 

 

 

 

County of Montgomery Maryland, GO, West Germantown
Development District, Senior Series A (Radian),
6.70%, 7/01/27

 

 

1,155

 

 

1,180,953

 

Maryland Community Development Administration,
Refunding RB, Residential, Series D, AMT, 4.90%,
9/01/42

 

 

1,500

 

 

1,517,925

 

Maryland EDC, RB, Transportation Facilities Project,
Series A, 5.75%, 6/01/35

 

 

435

 

 

461,357

 

Maryland EDC, Refunding RB, CNX Marine Terminals,
Inc., 5.75%, 9/01/25

 

 

830

 

 

868,777

 

Maryland Health & Higher Educational Facilities
Authority, RB, University of Maryland Medical System,
Series B (NPFGC), 7.00%, 7/01/22

 

 

1,000

 

 

1,222,700

 

Maryland Health & Higher Educational Facilities
Authority, Refunding RB, Ascension Health, Series B,
5.00%, 11/15/51 (b)

 

 

3,300

 

 

3,562,284

 

 

 

 

 

 

 

8,813,996

 

Massachusetts — 3.5%

 

 

 

 

 

 

 

Massachusetts Health & Educational Facilities Authority,
Refunding RB, Partners Healthcare, Series J1,
5.00%, 7/01/39

 

 

1,805

 

 

1,924,563

 

Massachusetts HFA, RB, AMT:

 

 

 

 

 

 

 

S/F, Series 130, 5.00%, 12/01/32

 

 

2,720

 

 

2,776,821

 

Series A, 5.20%, 12/01/37

 

 

2,895

 

 

2,971,544

 

Massachusetts HFA, Refunding HRB, AMT:

 

 

 

 

 

 

 

Series D, 4.85%, 6/01/40

 

 

1,770

 

 

1,790,178

 

Series F, 5.70%, 6/01/40

 

 

2,130

 

 

2,240,738

 

 

 

 

 

 

 

11,703,844

 

Michigan — 7.3%

 

 

 

 

 

 

 

City of Detroit Michigan, RB, Senior Lien, Water Supply
System, Series A, 5.25%, 7/01/41

 

 

3,075

 

 

3,135,301

 

City of Detroit Michigan, RB, Series B, Senior Lien,
(AGM), 7.50%, 7/01/33

 

 

910

 

 

1,140,285

 

Kalamazoo Hospital Finance Authority, Refunding RB,
Bronson Methodist Hospital, 5.50%, 5/15/36

 

 

1,380

 

 

1,492,525

 

Michigan State Hospital Finance Authority, Refunding
RB, Series A:

 

 

 

 

 

 

 

Henry Ford Health System, 5.25%, 11/15/46

 

 

6,850

 

 

7,083,790

 

McLaren Health Care, 5.75%, 5/15/38

 

 

8,560

 

 

9,414,630

 

Royal Oak Hospital Finance Authority Michigan,
Refunding RB, William Beaumont Hospital, 8.25%,
9/01/39

 

 

1,400

 

 

1,780,352

 

 

 

 

 

 

 

24,046,883

 


 

 

 

 

See Notes to Financial Statements.

 

 

ANNUAL REPORT

APRIL 30, 2012

45




 

 

 

 

Schedule of Investments (continued)

BlackRock MuniVest Fund II, Inc. (MVT)
(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Minnesota — 2.8%

 

 

 

 

 

 

 

Rochester Minnesota Health Care Facilities, RB, Mayo
Clinic, 4.00%, 11/15/41

 

$

1,000

 

$

991,420

 

Tobacco Securitization Authority Minnesota, Refunding
RB, Tobacco Settlement, Series B:

 

 

 

 

 

 

 

5.25%, 3/01/25

 

 

4,495

 

 

5,062,494

 

5.25%, 3/01/31

 

 

3,015

 

 

3,316,259

 

 

 

 

 

 

 

9,370,173

 

Mississippi — 1.4%

 

 

 

 

 

 

 

County of Lowndes Mississippi, Refunding RB,
Weyerhaeuser Co. Project, Series A, 6.80%, 4/01/22

 

 

3,000

 

 

3,361,740

 

University of Southern Mississippi, RB, Campus
Facilities Improvements Project, 5.38%, 9/01/36

 

 

1,065

 

 

1,185,153

 

 

 

 

 

 

 

4,546,893

 

Nebraska — 0.7%

 

 

 

 

 

 

 

Central Plains Energy Project, RB, Gas Project No. 3:

 

 

 

 

 

 

 

5.25%, 9/01/37

 

 

825

 

 

857,670

 

5.00%, 9/01/42

 

 

1,445

 

 

1,449,537

 

 

 

 

 

 

 

2,307,207

 

Nevada — 0.2%

 

 

 

 

 

 

 

County of Clark Nevada, Special Assessment Bonds,
Special Improvement District No. 142, Local
Improvement, 6.38%, 8/01/23

 

 

535

 

 

552,468

 

New Jersey — 3.5%

 

 

 

 

 

 

 

New Jersey EDA, RB, Continental Airlines, Inc. Project,
AMT, 6.25%, 9/15/29

 

 

3,000

 

 

3,007,200

 

New Jersey EDA, Refunding RB, Cigarette Tax, 5.00%,
6/15/23

 

 

975

 

 

1,093,180

 

New Jersey Health Care Facilities Financing Authority,
RB, Pascack Valley Hospital Association, 6.63%,
7/01/36 (c)(d)

 

 

1,680

 

 

17

 

New Jersey State Housing & Mortgage Finance Agency,
RB, Series AA, 6.38%, 10/01/28

 

 

1,105

 

 

1,214,561

 

New Jersey Transportation Trust Fund Authority, RB,
Transportation System:

 

 

 

 

 

 

 

Series A, 5.50%, 6/15/41

 

 

1,635

 

 

1,863,802

 

Series B, 5.25%, 6/15/36

 

 

2,460

 

 

2,748,853

 

Tobacco Settlement Financing Corp. New Jersey,
Refunding RB, Series 1A, 4.50%, 6/01/23

 

 

1,860

 

 

1,758,760

 

 

 

 

 

 

 

11,686,373

 

New York — 8.8%

 

 

 

 

 

 

 

Metropolitan Transportation Authority, RB, Series 2008C,
6.50%, 11/15/28

 

 

9,405

 

 

11,921,966

 

Metropolitan Transportation Authority, Refunding RB,
Transportation, Series D, 5.25%, 11/15/40

 

 

1,205

 

 

1,318,523

 

New York City Industrial Development Agency, RB:

 

 

 

 

 

 

 

British Airways Plc Project, 7.63%, 12/01/32

 

 

1,920

 

 

1,982,400

 

Series C, 6.80%, 6/01/28

 

 

690

 

 

709,134

 

Special Needs Facilities Pooled Program, Series C-1,
6.50%, 7/01/17

 

 

890

 

 

894,370

 

New York City Transitional Finance Authority, RB, Fiscal
2009, Series S-3, 5.25%, 1/15/39

 

 

6,700

 

 

7,361,692

 

New York Liberty Development Corp., Refunding RB,
Second Priority, Bank of America Tower at One Bryant
Park Project, 6.38%, 7/15/49

 

 

1,220

 

 

1,358,263

 

Port Authority of New York & New Jersey, RB, JFK
International Air Terminal:

 

 

 

 

 

 

 

6.00%, 12/01/36

 

 

1,165

 

 

1,304,555

 

6.00%, 12/01/42

 

 

1,250

 

 

1,385,450

 

Westchester County Industrial Development Agency
New York, RB, Special Needs Facilities Pooled Program,
Series E-1, 6.50%, 7/01/17

 

 

1,000

 

 

1,004,910

 

 

 

 

 

 

 

29,241,263

 


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

North Carolina — 1.5%

 

 

 

 

 

 

 

Gaston County Industrial Facilities & Pollution Control
Financing Authority North Carolina, RB, Exempt
Facilities National Gypsum Co. Project, AMT,
5.75%, 8/01/35

 

$

1,675

 

$

1,408,357

 

North Carolina Medical Care Commission, RB, Duke
University Health System, Series A, 5.00%, 6/01/42

 

 

1,400

 

 

1,506,162

 

North Carolina Medical Care Commission, Refunding
RB, Carolina Village Project, 6.00%, 4/01/38

 

 

2,000

 

 

2,022,680

 

 

 

 

 

 

 

4,937,199

 

Oregon — 0.2%

 

 

 

 

 

 

 

City of Tigard Washington County Oregon, RB, Water
System (b):

 

 

 

 

 

 

 

5.00%, 8/01/37

 

 

250

 

 

279,318

 

5.00%, 8/01/42

 

 

295

 

 

328,792

 

 

 

 

 

 

 

608,110

 

Pennsylvania — 2.5%

 

 

 

 

 

 

 

Allegheny County Hospital Development Authority,
Refunding RB, Health System, West Penn, Series A,
5.38%, 11/15/40

 

 

2,205

 

 

1,837,757

 

Bucks County IDA, RB, Ann’s Choice Inc. Facility,
Series A, 6.13%, 1/01/25

 

 

880

 

 

886,626

 

Montgomery County IDA Pennsylvania, MRB, Whitemarsh
Continuing Care, 6.13%, 2/01/28

 

 

420

 

 

416,396

 

Pennsylvania Economic Development Financing
Authority, RB:

 

 

 

 

 

 

 

Aqua Pennsylvania Inc. Project, 5.00%, 11/15/40

 

 

1,890

 

 

2,062,066

 

National Gypsum Co., Series B, AMT, 6.13%,
11/01/27

 

 

2,000

 

 

1,792,540

 

Philadelphia Authority for Industrial Development, RB,
Commercial Development, AMT, 7.75%, 12/01/17

 

 

1,265

 

 

1,266,607

 

 

 

 

 

 

 

8,261,992

 

Puerto Rico — 3.0%

 

 

 

 

 

 

 

Puerto Rico Commonwealth Aqueduct & Sewer Authority,
Refunding RB, Senior Lien, Series A:

 

 

 

 

 

 

 

5.13%, 7/01/37

 

 

345

 

 

344,248

 

5.25%, 7/01/42

 

 

570

 

 

568,244

 

Puerto Rico Sales Tax Financing Corp., RB, First
Sub-Series A, 6.50%, 8/01/44

 

 

4,255

 

 

4,988,775

 

Puerto Rico Sales Tax Financing Corp., Refunding RB,
Series C, 6.25%, 8/01/39 (a)

 

 

18,670

 

 

4,133,351

 

 

 

 

 

 

 

10,034,618

 

South Carolina — 2.3%

 

 

 

 

 

 

 

South Carolina State Ports Authority, RB, 5.25%,
7/01/40

 

 

3,280

 

 

3,601,506

 

South Carolina State Public Service Authority,
Refunding RB:

 

 

 

 

 

 

 

5.00%, 12/01/36

 

 

1,540

 

 

1,710,801

 

Series D, 5.00%, 12/01/43

 

 

2,100

 

 

2,296,539

 

 

 

 

 

 

 

7,608,846

 

Tennessee — 0.4%

 

 

 

 

 

 

 

Johnson City Health & Educational Facilities Board,
RB, Appalachian Christian Village Project, Series A,
6.00%, 2/15/24

 

 

1,000

 

 

1,000,100

 

Rutherford County Health & Educational Facilities
Board, Refunding RB, Ascension Health, Series C,
5.00%, 11/15/47 (b)

 

 

210

 

 

226,691

 

 

 

 

 

 

 

1,226,791

 


 

 

 

 

See Notes to Financial Statements.

 

46

ANNUAL REPORT

APRIL 30, 2012




 

 

 

 

Schedule of Investments (continued)

BlackRock MuniVest Fund II, Inc. (MVT)
(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Texas — 10.3%

 

 

 

 

 

 

 

Brazos River Authority, Refunding RB, Texas Utility Co.,
Series A, AMT, 7.70%, 4/01/33

 

$

1,500

 

$

213,360

 

Brazos River Harbor Navigation District, Refunding RB,
Dow Chemical Co. Project, Series A7, AMT, 6.63%,
5/15/33

 

 

3,000

 

 

3,034,080

 

Central Texas Regional Mobility Authority, RB, Senior
Lien, 6.25%, 1/01/46

 

 

2,140

 

 

2,359,371

 

City of Dallas Texas, Refunding RB, Waterworks & Sewer
System, 5.00%, 10/01/35

 

 

1,510

 

 

1,699,686

 

City of Houston Texas, RB, Special Facilities, Continental
Airlines, Series E, AMT, 6.75%, 7/01/21

 

 

4,820

 

 

4,858,319

 

Harris County Health Facilities Development Corp.,
Refunding RB, Memorial Hermann Healthcare System,
Series B, 7.25%, 12/01/35

 

 

2,000

 

 

2,387,040

 

North Texas Tollway Authority, Refunding RB, First Tier,
Series A, 6.25%, 1/01/39

 

 

7,000

 

 

7,896,070

 

Texas Private Activity Bond Surface Transportation Corp.,
RB, Senior Lien:

 

 

 

 

 

 

 

LBJ Infrastructure Group LLC, LBJ Freeway Managed
Lanes Project, 7.00%, 6/30/40

 

 

3,950

 

 

4,594,877

 

NTE Mobility Partners LLC, North Tarrant Express
Managed Lanes Project, 6.88%, 12/31/39

 

 

3,000

 

 

3,440,670

 

University of Texas System, Refunding RB, Financing
System, Series B, 5.00%, 8/15/43

 

 

3,080

 

 

3,519,147

 

 

 

 

 

 

 

34,002,620

 

Virginia — 2.7%

 

 

 

 

 

 

 

Fairfax County EDA, Refunding RB, Goodwin House Inc.:

 

 

 

 

 

 

 

5.13%, 10/01/37

 

 

500

 

 

505,750

 

5.13%, 10/01/42

 

 

3,440

 

 

3,468,174

 

Virginia Small Business Financing Authority, RB, Senior
Lien, Elizabeth River Crossings Project, Senior Lien,
Elizabeth River:

 

 

 

 

 

 

 

5.25%, 1/01/32

 

 

1,615

 

 

1,658,427

 

6.00%, 1/01/37

 

 

1,830

 

 

1,988,039

 

5.50%, 1/01/42

 

 

1,155

 

 

1,188,264

 

 

 

 

 

 

 

8,808,654

 

Washington — 2.1%

 

 

 

 

 

 

 

Washington Health Care Facilities Authority, RB,
Swedish Health Services, Series A, 6.75%, 11/15/41

 

 

1,980

 

 

2,522,777

 

Washington Health Care Facilities Authority, Refunding
RB, Catholic Health Initiatives, Series D, 6.38%,
10/01/36

 

 

3,700

 

 

4,356,750

 

 

 

 

 

 

 

6,879,527

 

Wisconsin — 4.1%

 

 

 

 

 

 

 

State of Wisconsin, Refunding RB, Series A, 6.00%,
5/01/36

 

 

7,100

 

 

8,594,124

 

Wisconsin Health & Educational Facilities Authority, RB:

 

 

 

 

 

 

 

Ascension Health Senior Credit Group, 5.00%,
11/15/33

 

 

2,465

 

 

2,684,311

 

SynergyHealth Inc., 6.00%, 11/15/32

 

 

2,215

 

 

2,276,112

 

 

 

 

 

 

 

13,554,547

 

Total Municipal Bonds — 117.1%

 

 

 

 

 

387,626,243

 


 

 

 

 

 

 

 

 

Municipal Bonds Transferred to
Tender Option Bond Trusts (g)

 

Par
(000)

 

Value

 

Arizona — 0.8%

 

 

 

 

 

 

 

Salt River Project Agricultural Improvement & Power
District, RB, Series A, 5.00%, 1/01/38

 

$

2,450

 

$

2,656, 802

 

California — 6.3%

 

 

 

 

 

 

 

Bay Area Toll Authority, Refunding RB, San Francisco
Bay Area, Series F-1, 5.63%, 4/01/44

 

 

3,271

 

 

3,666,481

 

California Educational Facilities Authority, RB, University
of Southern California, Series B, 5.25%, 10/01/39

 

 

2,610

 

 

2,961,228

 

Los Angeles Community College District California, GO,
Election of 2001, Series A (AGM), 5.00%, 8/01/32

 

 

2,290

 

 

2,571,578

 

San Diego Community College District California, GO,
Election of 2002, 5.25%, 8/01/33

 

 

1,077

 

 

1,235,957

 

San Francisco City & County Public Utilities
Commission, RB, Series B, 5.00%, 11/01/39

 

 

9,480

 

 

10,470,470

 

 

 

 

 

 

 

20,905,714

 

Colorado — 0.7%

 

 

 

 

 

 

 

Colorado Health Facilities Authority, Refunding RB,
Series A, 5.50%, 7/01/34

 

 

2,129

 

 

2,383,054

 

Connecticut — 2.0%

 

 

 

 

 

 

 

Connecticut State Health & Educational Facility
Authority, RB, Yale University, Series Z-3, 5.05%,
7/01/42

 

 

6,000

 

 

6,712,440

 

Florida — 1.9%

 

 

 

 

 

 

 

County of Miami-Dade Florida, RB, Water & Sewer
System, 5.00%, 10/01/34

 

 

5,679

 

 

6,243,405

 

Illinois — 1.4%

 

 

 

 

 

 

 

City of Chicago Illinois, Refunding RB, Second Lien
(AGM), 5.25%, 11/01/33

 

 

1,320

 

 

1,439,261

 

Illinois State Toll Highway Authority, RB, Series B,
5.50%, 1/01/33

 

 

2,999

 

 

3,273,200

 

 

 

 

 

 

 

4,712,461

 

Maryland — 0.8%

 

 

 

 

 

 

 

Maryland State Transportation Authority, RB,
Transportation Facility Project (AGM), 5.00%,
7/01/41

 

 

2,290

 

 

2,493,604

 

Massachusetts — 4.9%

 

 

 

 

 

 

 

Massachusetts School Building Authority, RB:

 

 

 

 

 

 

 

Sales Tax Revenue, Senior, Series B, 5.00%,
10/15/41

 

 

4,530

 

 

5,076,952

 

Sales Tax Revenue, Series A (AGM), 5.00%,
8/15/30

 

 

10,000

 

 

11,062,000

 

 

 

 

 

 

 

16,138,952

 

New Hampshire — 0.7%

 

 

 

 

 

 

 

New Hampshire Health & Education Facilities Authority,
RB, Dartmouth College, 5.25%, 6/01/39

 

 

2,009

 

 

2,309,168

 

New York — 11.7%

 

 

 

 

 

 

 

Hudson New York Yards Infrastructure Corp., RB, Senior,
Series A, 5.75%, 2/15/47

 

 

1,610

 

 

1,816,838

 

New York City Municipal Water & Sewer Finance
Authority, RB, Water & Sewer System, Series FF-2,
5.50%, 6/15/40

 

 

1,575

 

 

1,799,347

 

New York City Municipal Water & Sewer Finance
Authority, Refunding RB, Water & Sewer System,
Series DD, 5.00%, 6/15/37

 

 

6,299

 

 

6,801,263

 

New York City Transitional Finance Authority, RB,
Future Tax Secured Revenue, Sub-Series E-1,
5.00%, 2/01/42

 

 

2,459

 

 

2,731,899

 

New York Liberty Development Corp., RB, 5.25%,
12/15/43

 

 

10,740

 

 

12,068,001

 

New York Liberty Development Corp., Refunding RB,
5.75%, 11/15/51

 

 

6,440

 

 

7,310,108

 

New York State Dormitory Authority, ERB, Series F,
5.00%, 3/15/35

 

 

5,789

 

 

6,275,281

 

 

 

 

 

 

 

38,802,737

 


 

 

 

 

See Notes to Financial Statements.

 

 

ANNUAL REPORT

APRIL 30, 2012

47




 

 

 

 

Schedule of Investments (continued)

BlackRock MuniVest Fund II, Inc. (MVT)
(Percentages shown are based on Net Assets)


 

 

 

 

 

 

 

 

Municipal Bonds Transferred to
Tender Option Bond Trusts (g)

 

Par
(000)

 

Value

 

North Carolina — 2.0%

 

 

 

 

 

 

 

North Carolina Capital Facilities Finance Agency, RB,
Duke University Project, Series A, 5.00%, 10/01/41

 

$

6,239

 

$

6,681,215

 

Ohio — 5.4%

 

 

 

 

 

 

 

Ohio Higher Educational Facility Commission, RB,
Hospital, Cleveland Clinic Health, Series A, 5.25%,
1/01/33

 

 

2,400

 

 

2,597,496

 

State of Ohio, Refunding RB, Cleveland Clinic Health,
Series A, 5.50%, 1/01/39

 

 

13,843

 

 

15,259,811

 

 

 

 

 

 

 

17,857,307

 

South Carolina — 1.7%

 

 

 

 

 

 

 

South Carolina State Public Service Authority, Refunding
RB, Santee Cooper, Series A, 5.50%, 1/01/38

 

 

4,995

 

 

5,625,519

 

Texas — 3.2%

 

 

 

 

 

 

 

Harris County Metropolitan Transit Authority, RB, Sales
and Use Tax Bonds, Series A, 5.00%, 11/01/41

 

 

3,400

 

 

3,751,424

 

Texas Department of Housing & Community Affairs,
MRB, Series B, AMT (Ginnie Mae), 5.25%, 9/01/32

 

 

3,451

 

 

3,571,478

 

Texas State University Systems, Refunding RB (AGM),
5.00%, 3/15/30

 

 

2,743

 

 

3,065,220

 

 

 

 

 

 

 

10,388,122

 

Utah — 0.9%

 

 

 

 

 

 

 

City of Riverton Utah, RB, IHC Health Services, Inc.,
5.00%, 8/15/41

 

 

2,774

 

 

2,973,487

 

Washington — 5.6%

 

 

 

 

 

 

 

Central Puget Sound Regional Transit Authority, RB,
Series A:

 

 

 

 

 

 

 

5.00%, 11/01/34

 

 

5,000

 

 

5,509,250

 

5.00%, 11/01/36

 

 

4,000

 

 

4,407,400

 

(AGM), 5.00%, 11/01/32

 

 

7,693

 

 

8,647,554

 

 

 

 

 

 

 

18,564,204

 

Wisconsin — 0.8%

 

 

 

 

 

 

 

Wisconsin Health & Educational Facilities Authority,
Refunding RB, Froedtert & Community Health Inc.,
5.25%, 4/01/39

 

 

2,499

 

 

2,716,471

 

Total Municipal Bonds Transferred to
Tender Option Bond Trusts — 50.8%

 

 

 

 

 

168,164,662

 

Total Long-Term Investments
(Cost — $508,336,982) — 167.9%

 

 

 

 

 

555,790,905

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Short-Term Securities

 

 

Shares

 

 

 

 

FFI Institutional Tax-Exempt Fund, 0.09% (h)(i)

 

 

40,158

 

 

40,158

 

 

 

 

 

 

 

 

 

 

 

Par
(000)

 

 

 

 

Connecticut Housing Finance Authority, RB, VRDN,
Housing Mortgage Finance Program, Sub-Series A-2
(JPMorgan Chase Bank NA SBPA), 0.25%,
5/01/12 (j)

 

$

5,200

 

 

5,200,000

 

Total Short-Term Securities
(Cost — $5,240,158) — 1.6%

 

 

 

 

 

5,240,158

 

Total Investments (Cost — $513,577,140) — 169.5%

 

 

 

 

 

561,031,063

 

Liabilities in Excess of Other Assets — (0.4)%

 

 

 

 

 

(1,506,458

)

Liability for TOB Trust Certificates, Including
Interest Expense and Fees Payable — (26.8)%

 

 

 

 

 

(88,583,620

)

VMTP Shares, at Liquidation Value — (42.3)%

 

 

 

 

 

(140,000,000

)

Net Assets Applicable to Common Shares — 100.0%

 

 

 

 

$

330,940,985

 


 

 

(a)

Represents a zero-coupon bond. Rate shown reflects the current yield as of report date.

 

 

(b)

When-issued security. Unsettled when-issued transactions were as follows:


 

 

 

 

 

 

 

 

Counterparty

 

Value

 

Unrealized
Appreciation

 

Morgan Stanley & Co., Inc.

 

$

6,751,491

 

$

62,530

 

Stone & Youngberg LLC

 

$

1,400,700

 

$

30,760

 

Wells Fargo Securities

 

$

608,110

 

$

7,194

 


 

 

(c)

Issuer filed for bankruptcy and/or is in default of interest payments.

 

 

(d)

Non-income producing security.

 

 

(e)

Security is collateralized by Municipal or US Treasury obligations.

 

 

(f)

US government securities, held in escrow, are used to pay interest on this security, as well as to retire the bond in full at the date indicated, typically at a premium to par.

 

 

(g)

Securities represent bonds transferred to a TOB in exchange for which the Fund acquired residual interest certificates. These securities serve as collateral in a financing transaction. See Note 1 of the Notes to Financial Statements for details of municipal bonds transferred to TOBs.

 

 

(h)

Investments in companies considered to be an affiliate of the Fund during the year, for purposes of Section 2(a)(3) of the 1940 Act, as amended, were as follows:


 

 

 

 

 

 

 

 

 

 

 

 

 

 

Affiliate

 

Shares
Held at
April 30,
2011

 

Net
Activity

 

Shares
Held at
April 30,
2012

 

Income

 

FFI Institutional Tax-Exempt Fund

 

 

5,653,323

 

 

(5,613,165

)

 

40,158

 

$

1,191

 


 

 

(i)

Represents the current yield as of report date.

 

 

(j)

Variable rate security. Rate shown is as of report date and maturity shown is the date the principal owed can be recovered through demand.

 

 

Financial futures contracts sold as of April 30, 2012 were as follows:


 

 

 

 

 

 

 

 

 

 

 

 

 

 

Contracts

 

Issue

 

Exchange

 

Expiration

 

Notional
Value

 

Unrealized
Appreciation

 

285

 

10-Year US Treasury Note

 

Chicago Board of Trade

 

June 2012

 

$

37,700,156

 

$

(470,479

)


 

 

 

Fair Value Measurements — Various inputs are used in determining the fair value of investments and derivative financial instruments. These inputs are categorized into a disclosure hierarchy consisting of three broad levels for financial statement purposes as follows:

 

 

 

 

Level 1 — unadjusted price quotations in active markets/exchanges for identical assets and liabilities

 

 

 

 

Level 2 — other observable inputs (including, but not limited to: quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs)

 

 

 

 

Level 3 — unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Fund’s own assumptions used in determining the fair value of investments and derivative financial instruments)

 

 

 

 

Changes in valuation techniques may result in transfers into or out of an assigned level within the disclosure hierarchy. The categorization of a value determined for investments and derivative financial instruments is based on the pricing transparency of the investment and derivative financial instrument and is not necessarily an indication of the risks associated with investing in those securities. For information about the Fund’s policy regarding valuation of investments and derivative financial instruments and other significant accounting policies, please refer to Note 1 of the Notes to Financial Statements.


 

 

 

See Notes to Financial Statements.

 

 

 

48

ANNUAL REPORT

APRIL 30, 2012




 

 

 

 

Schedule of Investments (concluded)

BlackRock MuniVest Fund II, Inc. (MVT)

The following tables summarize the inputs used as of April 30, 2012 in determining the fair valuation of the Fund’s investments and derivative financial instruments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Valuation Inputs

 

Level 1

 

Level 2

 

Level 3

 

Total

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

Investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

Long Term Investments1

 

 

 

$

555,790,905

 

 

 

$

555,790,905

 

Short-Term Securities

 

$

40,158

 

 

5,200,000

 

 

 

 

5,240,158

 

Total

 

$

40,158

 

$

560,990,905

 

 

 

$

561,031,063

 


 

 

 

 

1

See above Schedule of Investments for values in each state or political subdivision.


 

 

 

 

 

 

 

 

 

 

 

 

 

 

Valuation Inputs

 

Level 1

 

Level 2

 

Level 3

 

Total

 

Derivative Financial Instruments2

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest rate contracts

 

$

(470,479

)

 

 

 

 

$

(470,479

)


 

 

 

 

2

Derivative financial instruments are financial futures contracts which are valued at the unrealized appreciation/depreciation on the instrument.


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

49




 

 

Statements of Assets and Liabilities


 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

April 30, 2012

 

BlackRock
MuniAssets
Fund, Inc.
(MUA)

 

BlackRock
MuniEnhanced
Fund, Inc.
(MEN)

 

BlackRock
MuniHoldings
Fund, Inc.
(MHD)

 

BlackRock
MuniHoldings
Fund II, Inc.
(MUH)

 

BlackRock
MuniHoldings
Quality
Fund, Inc.
(MUS)

 

BlackRock
Muni Intermediate
Duration
Fund, Inc.
(MUI)

 

BlackRock
MuniVest
Fund II, Inc.
(MVT)

 

Assets

Investments at value — unaffiliated1

 

$

531,232,027

 

$

554,930,379

 

$

385,418,062

 

$

284,051,492

 

$

316,790,218

 

$

983,480,927

 

$

560,990,905

 

Investments at value — affiliated2

 

 

3,404,970

 

 

9,127,957

 

 

22,614

 

 

27,550

 

 

22,670

 

 

3,601,217

 

 

40,158

 

Cash pledged as collateral for financial futures contracts

 

 

370,000

 

 

264,000

 

 

278,000

 

 

209,000

 

 

254,000

 

 

951,000

 

 

377,000

 

Interest receivable

 

 

8,948,238

 

 

7,798,745

 

 

5,640,113

 

 

3,989,170

 

 

4,205,777

 

 

13,240,139

 

 

8,635,069

 

Investments sold receivable

 

 

10,230,424

 

 

1,990,817

 

 

6,213,918

 

 

3,486,658

 

 

713,190

 

 

195,000

 

 

2,525,528

 

Deferred offering costs

 

 

 

 

254,046

 

 

137,893

 

 

122,611

 

 

141,793

 

 

1,058,264

 

 

175,073

 

Prepaid expenses

 

 

23,186

 

 

109,260

 

 

15,385

 

 

11,218

 

 

7,620

 

 

325,624

 

 

12,732

 

Total assets

 

 

554,208,845

 

 

574,475,204

 

 

397,725,985

 

 

291,897,699

 

 

322,135,268

 

 

1,002,852,171

 

 

572,756,465

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accrued Liabilities

Bank overdraft

 

 

 

 

11,875

 

 

 

 

 

 

 

 

23,924

 

 

 

Investments purchased payable

 

 

8,420,545

 

 

3,497,753

 

 

6,676,914

 

 

4,831,759

 

 

2,724,837

 

 

13,251,945

 

 

10,948,945

 

Income dividends payable — Common Shares

 

 

2,233,870

 

 

1,709,027

 

 

1,286,018

 

 

933,761

 

 

959,993

 

 

2,722,770

 

 

1,893,191

 

Investment advisory fees payable

 

 

242,294

 

 

231,349

 

 

173,748

 

 

127,742

 

 

130,281

 

 

441,875

 

 

226,501

 

Variation margin payable

 

 

35,000

 

 

25,000

 

 

26,250

 

 

19,750

 

 

24,000

 

 

90,000

 

 

35,625

 

Interest expense and fees payable

 

 

28,474

 

 

39,968

 

 

27,367

 

 

21,575

 

 

16,911

 

 

37,441

 

 

43,747

 

Officer’s and Directors’ fees payable

 

 

2,969

 

 

5,047

 

 

3,606

 

 

2,582

 

 

2,701

 

 

144,521

 

 

4,753

 

Other accrued expenses payable

 

 

137,668

 

 

156,070

 

 

84,690

 

 

62,957

 

 

78,284

 

 

172,889

 

 

122,845

 

Total accrued liabilities

 

 

11,100,820

 

 

5,676,089

 

 

8,278,593

 

 

6,000,126

 

 

3,937,007

 

 

16,885,365

 

 

13,275,607

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other Liabilities

TOB trust certificates

 

 

61,510,427

 

 

69,282,084

 

 

61,757,895

 

 

48,273,237

 

 

41,631,272

 

 

81,429,692

 

 

88,539,873

 

VRDP Shares, at liquidation value of $100,000 per share3,4

 

 

 

 

142,500,000

 

 

 

 

 

 

 

 

287,100,000

 

 

 

VMTP Shares, at liquidation value of $100,000 per share3,4

 

 

 

 

 

 

83,700,000

 

 

55,000,000

 

 

87,000,000

 

 

 

 

140,000,000

 

Total other liabilities

 

 

61,510,427

 

 

211,782,084

 

 

145,457,895

 

 

103,273,237

 

 

128,631,272

 

 

368,529,692

 

 

228,539,873

 

Total liabilities

 

 

72,611,247

 

 

217,458,173

 

 

153,736,488

 

 

109,273,363

 

 

132,568,279

 

 

385,415,057

 

 

241,815,480

 

Net Assets Applicable to Common Shareholders

 

$

481,597,598

 

$

357,017,031

 

$

243,989,497

 

$

182,624,336

 

$

189,566,989

 

$

617,437,114

 

$

330,940,985

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Assets Applicable to Common Shareholders Consist of

Paid-in capital5

 

$

479,397,343

 

$

315,235,026

 

$

209,408,538

 

$

154,696,048

 

$

174,729,963

 

$

541,201,305

 

$

284,512,904

 

Undistributed net investment income

 

 

2,005,206

 

 

6,013,515

 

 

4,428,518

 

 

4,100,642

 

 

3,210,440

 

 

9,173,694

 

 

5,961,823

 

Undistributed net realized gain (accumulated net realized loss)

 

 

(18,667,874

)

 

(10,099,972

)

 

1,557,594

 

 

292,514

 

 

(12,475,401

)

 

(1,424,768

)

 

(6,517,186

)

Net unrealized appreciation/depreciation

 

 

18,862,923

 

 

45,868,462

 

 

28,594,847

 

 

23,535,132

 

 

24,101,987

 

 

68,486,883

 

 

46,983,444

 

Net Assets Applicable to Common Shareholders

 

$

481,597,598

 

$

357,017,031

 

$

243,989,497

 

$

182,624,336

 

$

189,566,989

 

$

617,437,114

 

$

330,940,985

 

Net asset value, per Common Share

 

$

13.47

 

$

12.12

 

$

17.36

 

$

16.23

 

$

14.61

 

$

16.21

 

$

15.91

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

Investments at cost — unaffiliated

 

$

511,888,916

 

$

508,744,974

 

$

356,477,097

 

$

260,255,185

 

$

292,402,866

 

$

913,600,488

 

$

513,536,982

 

2

Investments at cost — affiliated

 

$

3,404,970

 

$

9,127,957

 

$

22,614

 

$

27,550

 

$

22,670

 

$

3,601,217

 

$

40,158

 

3

VRDP/VMTP Shares outstanding, par value $0.10 per share

 

 

 

 

1,425

 

 

837

 

 

550

 

 

870

 

 

2,871

 

 

1,400

 

4

Preferred Shares authorized

 

 

 

 

7,480

 

 

5,000

 

 

3,480

 

 

5,360

 

 

15,671

 

 

7,000

 

5

Common Shares outstanding, 200 million shares authorized, $0.10 par value par value

 

 

35,741,923

 

 

29,465,984

 

 

14,054,846

 

 

11,250,134

 

 

12,972,879

 

 

38,080,693

 

 

20,804,301

 


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

50

ANNUAL REPORT

APRIL 30, 2012

 




 

 

Statements of Operations


 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended April 30, 2012

 

BlackRock
MuniAssets
Fund, Inc.
(MUA)

 

BlackRock
MuniEnhanced
Fund, Inc.
(MEN)

 

BlackRock
MuniHoldings
Fund, Inc.
(MHD)

 

BlackRock
MuniHoldings
Fund II, Inc.
(MUH)

 

BlackRock
MuniHoldings
Quality
Fund, Inc.
(MUS)

 

BlackRock
Muni Intermediate
Duration
Fund, Inc.
(MUI)

 

BlackRock
MuniVest
Fund II, Inc.
(MVT)

 

Investment Income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest

 

$

30,837,784

 

$

25,994,106

 

$

18,846,828

 

$

13,838,159

 

$

14,002,616

 

$

43,805,459

 

$

27,468,304

 

Income — affiliated

 

 

1,157

 

 

1,136

 

 

1,738

 

 

535

 

 

2,001

 

 

4,294

 

 

1,191

 

Total income

 

 

30,838,941

 

 

25,995,242

 

 

18,848,566

 

 

13,838,694

 

 

14,004,617

 

 

43,809,753

 

 

27,469,495

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses

Investment advisory

 

 

2,721,086

 

 

2,696,196

 

 

1,970,591

 

 

1,444,180

 

 

1,639,192

 

 

5,183,737

 

 

2,586,199

 

Liquidity fees

 

 

 

 

1,085,883

 

 

 

 

 

 

 

 

3,557,673

 

 

 

Professional

 

 

177,499

 

 

160,710

 

 

166,236

 

 

103,994

 

 

105,897

 

 

155,712

 

 

129,122

 

Accounting services

 

 

97,462

 

 

98,876

 

 

73,980

 

 

61,399

 

 

59,512

 

 

144,320

 

 

96,699

 

Remarketing fees on Preferred Shares

 

 

 

 

154,993

 

 

86,472

 

 

56,687

 

 

88,002

 

 

291,088

 

 

154,568

 

Transfer agent

 

 

68,504

 

 

46,253

 

 

50,931

 

 

37,595

 

 

36,000

 

 

55,193

 

 

58,315

 

Officer and Directors

 

 

48,892

 

 

45,822

 

 

31,096

 

 

23,416

 

 

24,340

 

 

85,195

 

 

41,881

 

Custodian

 

 

25,876

 

 

28,914

 

 

18,141

 

 

13,749

 

 

16,581

 

 

44,684

 

 

25,137

 

Printing

 

 

16,025

 

 

21,868

 

 

18,351

 

 

10,292

 

 

10,470

 

 

36,820

 

 

20,950

 

Registration

 

 

10,320

 

 

17,134

 

 

9,472

 

 

15,659

 

 

9,262

 

 

26,261

 

 

9,737

 

Miscellaneous

 

 

32,741

 

 

135,523

 

 

38,409

 

 

36,348

 

 

31,893

 

 

117,972

 

 

64,399

 

Total expenses excluding interest expense, fees and amortization of offering costs

 

 

3,198,405

 

 

4,492,172

 

 

2,463,679

 

 

1,803,319

 

 

2,021,149

 

 

9,698,655

 

 

3,187,007

 

Interest expense, fees and amortization of offering costs1

 

 

325,336

 

 

1,167,027

 

 

721,213

 

 

512,942

 

 

614,956

 

 

1,346,094

 

 

1,123,241

 

Total expenses

 

 

3,523,741

 

 

5,659,199

 

 

3,184,892

 

 

2,316,261

 

 

2,636,105

 

 

11,044,749

 

 

4,310,248

 

Less fees waived by advisor

 

 

(2,291

)

 

(4,467

)

 

(2,427

)

 

(1,250

)

 

(145,255

)

 

(9,017

)

 

(3,241

)

Total expenses after fees waived

 

 

3,521,450

 

 

5,654,732

 

 

3,182,465

 

 

2,315,011

 

 

2,490,850

 

 

11,035,732

 

 

4,307,007

 

Net investment income

 

 

27,317,491

 

 

20,340,510

 

 

15,666,101

 

 

11,523,683

 

 

11,513,767

 

 

32,774,021

 

 

23,162,488

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Realized and Unrealized Gain (Loss)

Net realized gain (loss) from:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investments

 

 

8,320,166

 

 

1,409,802

 

 

2,384,317

 

 

1,361,493

 

 

2,460,809

 

 

4,876,167

 

 

4,428,525

 

Financial futures contracts

 

 

(1,193,801

)

 

(2,084,916

)

 

(1,227,256

)

 

(879,309

)

 

(764,976

)

 

(1,700,081

)

 

(2,077,178

)

 

 

 

7,126,365

 

 

(675,114

)

 

1,157,061

 

 

482,184

 

 

1,695,833

 

 

3,176,086

 

 

2,351,347

 

Net change in unrealized appreciation/depreciation on:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investments

 

 

40,364,255

 

 

54,105,070

 

 

36,355,566

 

 

27,093,987

 

 

26,163,103

 

 

64,561,493

 

 

47,668,286

 

Financial futures contracts

 

 

(175,468

)

 

129,630

 

 

53,171

 

 

38,292

 

 

(127,751

)

 

(652,770

)

 

65,409

 

 

 

 

40,188,787

 

 

54,234,700

 

 

36,408,737

 

 

27,132,279

 

 

26,035,352

 

 

63,908,723

 

 

47,733,695

 

Total realized and unrealized gain

 

 

47,315,152

 

 

53,559,586

 

 

37,565,798

 

 

27,614,463

 

 

27,731,185

 

 

67,084,809

 

 

50,085,042

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividends to AMPS Shareholders From

Net investment loss

 

 

 

 

(86,943

)

 

(208,121

)

 

(87,811

)

 

(137,099

)

 

 

 

(473,170

)

Net Increase in Net Assets Applicable to Common Shareholders Resulting from Operations

 

$

74,632,643

 

$

73,813,153

 

$

53,023,778

 

$

39,050,335

 

$

39,107,853

 

$

99,858,830

 

$

72,774,360

 


 

 

 

 

1

Related to TOBs, VRDP and/or VMTP shares.


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

51




 

 

Statements of Changes in Net Assets


 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BlackRock MuniAssets
Fund, Inc. (MUA)

 

 

BlackRock
MuniEnhanced Fund, Inc. (MEN)

 

 

 

Year Ended April 30,

 

 

Year Ended April 30,

 

Increase (Decrease) in Net Assets Applicable to Common Shareholders:

 

2012

 

2011

 

 

2012

 

2011

 

Operations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net investment income

 

$

27,317,491

 

$

17,901,566

 

 

$

20,340,510

 

$

21,566,988

 

Net realized gain (loss)

 

 

7,126,365

 

 

(1,468,023

)

 

 

(675,114

)

 

(915,429

)

Net change in unrealized appreciation/depreciation

 

 

40,188,787

 

 

(8,573,199

)

 

 

54,234,700

 

 

(17,353,928

)

Dividends to AMPS Shareholders from net investment income

 

 

 

 

 

 

 

(86,943

)

 

(895,488

)

Net increase in net assets applicable to Common Shareholders resulting from operations

 

 

74,632,643

 

 

7,860,344

 

 

 

73,813,153

 

 

2,402,143

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividends to Common Shareholders From

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net investment income

 

 

(26,925,856

)

 

(17,952,389

)

 

 

(20,207,814

)

 

(20,117,032

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital Share Transactions

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Value of Common Shares issued from reorganization

 

 

 

 

176,471,885

 

 

 

 

 

 

Reinvestment of common dividends

 

 

 

 

679,731

 

 

 

147,962

 

 

895,425

 

Net increase in net assets applicable to Common Shareholders derived from capital share transactions

 

 

 

 

177,151,616

 

 

 

147,962

 

 

895,425

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total increase (decrease) in net assets applicable to Common Shareholders

 

 

47,706,787

 

 

167,059,571

 

 

 

53,753,301

 

 

(16,819,464

)

Beginning of year

 

 

433,890,811

 

 

266,831,240

 

 

 

303,263,730

 

 

320,083,194

 

End of year

 

$

481,597,598

 

$

433,890,811

 

 

$

357,017,031

 

$

303,263,730

 

Undistributed net investment income

 

$

2,005,206

 

$

1,662,370

 

 

$

6,013,515

 

$

5,981,672

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BlackRock
MuniHoldings Fund, Inc. (MHD)

 

 

BlackRock
MuniHoldings Fund II, Inc. (MUH)

 

 

 

Year Ended April 30,

 

 

Year Ended April 30,

 

Increase (Decrease) in Net Assets Applicable to Common Shareholders:

 

2012

 

2011

 

 

2012

 

2011

 

Operations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net investment income

 

$

15,666,101

 

$

15,853,128

 

 

$

11,523,683

 

$

11,489,662

 

Net realized gain

 

 

1,157,061

 

 

798,443

 

 

 

482,184

 

 

592,853

 

Net change in unrealized appreciation/depreciation

 

 

36,408,737

 

 

(14,759,280

)

 

 

27,132,279

 

 

(10,389,967

)

Dividends and distributions to AMPS Shareholders from:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net investment income

 

 

(208,121

)

 

(425,020

)

 

 

(87,811

)

 

(217,592

)

Net realized gain

 

 

 

 

(45,016

)

 

 

 

 

(16,958

)

Net increase in net assets applicable to Common Shareholders resulting from operations

 

 

53,023,778

 

 

1,422,255

 

 

 

39,050,335

 

 

1,457,998

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividends and Distributions to Common Shareholders From

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net investment income

 

 

(15,317,116

)

 

(14,941,651

)

 

 

(11,059,908

)

 

(10,870,379

)

Net realized gain

 

 

 

 

(1,505,648

)

 

 

 

 

(807,254

)

Decrease in net assets resulting from dividends and distributions to Common Shareholders

 

 

(15,317,116

)

 

(16,447,299

)

 

 

(11,059,908

)

 

(11,677,633

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital Share Transactions

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reinvestment of common dividends and distributions

 

 

914,394

 

 

1,260,083

 

 

 

375,140

 

 

756,581

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Assets Applicable to Common Shareholders

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total increase (decrease) in net assets applicable to Common Shareholders

 

 

38,621,056

 

 

(13,764,961

)

 

 

28,365,567

 

 

(9,463,054

)

Beginning of year

 

 

205,368,441

 

 

219,133,402

 

 

 

154,258,769

 

 

163,721,823

 

End of year

 

$

243,989,497

 

$

205,368,441

 

 

$

182,624,336

 

$

154,258,769

 

Undistributed net investment income

 

$

4,428,518

 

$

4,260,439

 

 

$

4,100,642

 

$

3,703,185

 


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

52

ANNUAL REPORT

APRIL 30, 2012

 




 

 

Statements of Changes in Net Assets


 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BlackRock MuniHoldings
Quality Fund, Inc. (MUS)

 

BlackRock Muni Intermediate
Duration Fund, Inc. (MUI)

 

 

 

Year Ended April 30,

 

Year Ended April 30,

 

Increase (Decrease) in Net Assets Applicable to Common Shareholders:

 

2012

 

2011

 

2012

 

2011

 

Operations

 

 

 

 

 

 

 

 

 

 

 

 

 

Net investment income

 

$

11,513,767

 

$

11,766,913

 

$

32,774,021

 

$

36,232,994

 

Net realized gain (loss)

 

 

1,695,833

 

 

(1,327,071

)

 

3,176,086

 

 

2,847,724

 

Net change in unrealized appreciation/depreciation

 

 

26,035,352

 

 

(9,676,582

)

 

63,908,723

 

 

(14,744,868

)

Dividends to AMPS Shareholders from net investment income

 

 

(137,099

)

 

(360,146

)

 

 

 

(3,940,263

)

Net increase in net assets applicable to Common Shareholders resulting from operations

 

 

39,107,853

 

 

403,114

 

 

99,858,830

 

 

20,395,587

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividends to Common Shareholders From

 

 

 

 

 

 

 

 

 

 

 

 

 

Net investment income

 

 

(11,509,551

)

 

(11,484,081

)

 

(32,680,904

)

 

(32,019,140

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital Share Transactions

 

 

 

 

 

 

 

 

 

 

 

 

 

Reinvestment of common dividends

 

 

249,057

 

 

823,393

 

 

742,887

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Assets Applicable to Common Shareholders

 

 

 

 

 

 

 

 

 

 

 

 

 

Total increase (decrease) in net assets applicable to Common Shareholders

 

 

27,847,359

 

 

(10,257,574

)

 

67,920,813

 

 

(11,623,553

)

Beginning of year

 

 

161,719,630

 

 

171,977,204

 

 

549,516,301

 

 

561,139,854

 

End of year

 

$

189,566,989

 

$

161,719,630

 

$

617,437,114

 

$

549,516,301

 

Undistributed net investment income

 

$

3,210,440

 

$

3,342,889

 

$

9,173,694

 

$

9,402,200

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BlackRock MuniVest
Fund II, Inc. (MVT)

 

 

 

 

 

 

 

 

 

Year Ended April 30,

 

Increase (Decrease) in Net Assets Applicable to Common Shareholders:

 

 

 

 

 

 

 

2012

 

2011

 

Operations

 

 

 

 

 

 

 

 

 

 

 

 

 

Net investment income

 

 

 

 

 

 

 

$

23,162,488

 

$

23,494,758

 

Net realized gain (loss)

 

 

 

 

 

 

 

 

2,351,347

 

 

(1,604,962

)

Net change in unrealized appreciation/depreciation

 

 

 

 

 

 

 

 

47,733,695

 

 

(18,706,944

)

Dividends to AMPS Shareholders from net investment income

 

 

 

 

 

 

 

 

(473,170

)

 

(921,768

)

Net increase in net assets applicable to Common Shareholders resulting from operations

 

 

 

 

 

 

 

 

72,774,360

 

 

2,261,084

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividends to Common Shareholders From

 

 

 

 

 

 

 

 

 

 

 

 

 

Net investment income

 

 

 

 

 

 

 

 

(22,158,463

)

 

(21,675,139

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital Share Transactions

 

 

 

 

 

 

 

 

 

 

 

 

 

Reinvestment of common dividends

 

 

 

 

 

 

 

 

2,041,162

 

 

2,232,641

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Assets Applicable to Common Shareholders

 

 

 

 

 

 

 

 

 

 

 

 

 

Total increase (decrease) in net assets applicable to Common Shareholders

 

 

 

 

 

 

 

 

52,657,059

 

 

(17,181,414

)

Beginning of year

 

 

 

 

 

 

 

 

278,283,926

 

 

295,465,340

 

End of year

 

 

 

 

 

 

 

$

330,940,985

 

$

278,283,926

 

Undistributed net investment income

 

 

 

 

 

 

 

$

5,961,823

 

$

5,996,321

 


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

53




 

 

Statements of Cash Flows


 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended April 30, 2012

 

BlackRock
MuniEnhanced
Fund, Inc.
(MEN)

 

BlackRock
MuniHoldings
Fund, Inc.
(MHD)

 

BlackRock
MuniHoldings
Fund II, Inc.
(MUH)

 

BlackRock
MuniHoldings
Quality
Fund, Inc.
(MUS)

 

BlackRock
Muni Intermediate
Duration
Fund, Inc.
(MUI)

 

BlackRock
MuniVest
Fund II, Inc.
(MVT)

 

Cash Provided by (Used for) Operating Activities

Net increase in net assets resulting from operations, excluding dividends to AMPS Shareholders

 

$

73,900,096

 

$

53,231,899

 

$

39,138,146

 

$

39,244,952

 

$

99,858,830

 

$

73,247,530

 

Adjustments to reconcile net increase in net assets resulting from operations to net cash provided by (used for) operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Increase) decrease in interest receivable

 

 

(74,756

)

 

44,998

 

 

7,083

 

 

(5,922

)

 

795,852

 

 

53,961

 

(Increase) decrease in cash pledged as collateral for financial futures contracts

 

 

66,000

 

 

17,000

 

 

11,000

 

 

(134,000

)

 

(406,000

)

 

18,000

 

Decrease in other assets

 

 

 

 

 

 

 

 

 

 

103,224

 

 

 

Increase (decrease) in variation margin payable

 

 

(6,875

)

 

(2,250

)

 

(1,625

)

 

3,375

 

 

37,125

 

 

(2,625

)

Decrease in income receivable — affiliated

 

 

 

 

 

 

 

 

 

 

279

 

 

 

(Increase) decrease in prepaid expenses

 

 

(79,248

)

 

287

 

 

6,521

 

 

4,426

 

 

(263,795

)

 

6,900

 

Increase (decrease) in investment advisory fees payable

 

 

19,119

 

 

20,152

 

 

15,615

 

 

17,067

 

 

24,699

 

 

24,920

 

Decrease in interest expense and fees payable

 

 

(18,388

)

 

(4,212

)

 

(3,318

)

 

(5,894

)

 

(13,188

)

 

(6,396

)

Increase (decrease) in other accrued expenses payable

 

 

(143,161

)

 

(914

)

 

(5,477

)

 

(11,093

)

 

(13,723

)

 

3,400

 

Decrease in offering costs payable

 

 

(68,382

)

 

 

 

 

 

 

 

(317,772

)

 

 

Increase in Officer’s and Directors’ fees payable

 

 

4,102

 

 

2,738

 

 

2,184

 

 

2,196

 

 

38,105

 

 

3,580

 

Net realized and unrealized gain on investments

 

 

(55,514,872

)

 

(38,739,883

)

 

(28,455,480

)

 

(28,623,912

)

 

(69,437,660

)

 

(52,096,811

)

Amortization of premium and accretion of discount on investments

 

 

(760,330

)

 

(375,656

)

 

(628,720

)

 

532,093

 

 

1,238,552

 

 

(64,984

)

Amortization of deferred offering costs

 

 

347,288

 

 

13,994

 

 

9,670

 

 

14,417

 

 

37,900

 

 

19,704

 

Proceeds from sales of long-term investments

 

 

112,283,804

 

 

61,491,723

 

 

44,040,955

 

 

87,686,248

 

 

253,518,358

 

 

65,457,221

 

Purchases of long-term investments

 

 

(111,269,995

)

 

(86,067,373

)

 

(63,155,159

)

 

(100,921,806

)

 

(274,025,250

)

 

(96,081,657

)

Net proceeds from sales (purchases) of short-term securities

 

 

(5,657,003

)

 

6,846,901

 

 

5,302,139

 

 

3,779,414

 

 

6,112,214

 

 

3,668,165

 

Cash provided by (used for) operating activities

 

 

13,027,399

 

 

(3,520,596

)

 

(3,716,466

)

 

1,581,561

 

 

17,287,750

 

 

(5,749,092

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash Provided by (Used for) Financing Activities

Cash receipts from TOB trust certificates

 

 

14,653,676

 

 

23,740,273

 

 

18,606,053

 

 

10,949,348

 

 

20,137,082

 

 

31,535,127

 

Cash payments for TOB trust certificates

 

 

(6,954,499

)

 

(5,470,000

)

 

(3,950,000

)

 

(983,490

)

 

(5,316,202

)

 

(5,040,030

)

Cash payments on redemption of AMPS

 

 

(142,575,000

)

 

(83,700,000

)

 

(55,050,000

)

 

(87,000,000

)

 

 

 

(140,000,000

)

Cash receipts from issuance of VMTP Shares

 

 

 

 

83,700,000

 

 

55,000,000

 

 

87,000,000

 

 

 

 

140,000,000

 

Cash receipts from issuance of VRDP Shares

 

 

142,500,000

 

 

 

 

 

 

 

 

 

 

 

Cash payments for offering costs

 

 

(532,952

)

 

(151,887

)

 

(132,281

)

 

(156,210

)

 

(51,957

)

 

(194,777

)

Cash dividends paid to Common Shareholders

 

 

(20,029,655

)

 

(14,383,554

)

 

(10,665,911

)

 

(11,259,175

)

 

(31,934,745

)

 

(20,052,968

)

Cash dividends paid to Preferred Shareholders

 

 

(100,497

)

 

(213,782

)

 

(91,395

)

 

(141,409

)

 

 

 

(498,260

)

Increase (decrease) in bank overdraft

 

 

11,528

 

 

(454

)

 

 

 

 

 

(121,928

)

 

 

Cash provided by (used for) financing activities

 

 

(13,027,399

)

 

3,520,596

 

 

3,716,466

 

 

(1,590,936

)

 

(17,287,750

)

 

5,749,092

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net increase (decrease) in cash

 

 

 

 

 

 

 

 

(9,375

)

 

 

 

 

Cash at beginning of year

 

 

 

 

 

 

 

 

9,375

 

 

 

 

 

Cash at end of year

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash Flow Information

Cash paid during the year for interest

 

$

838,127

 

$

711,431

 

$

506,590

 

$

606,433

 

$

1,321,382

 

$

1,109,933

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noncash Financing Activities

Capital shares issued in reinvestment of dividends paid to Common Shareholders

 

$

147,962

 

$

914,394

 

$

375,140

 

$

249,057

 

$

742,887

 

$

2,041,162

 


 

A Statement of Cash Flows is presented when a Fund had a significant amount of borrowing during the year, based on the average borrowing outstanding in relation to average total assets.


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

 

54

ANNUAL REPORT

APRIL 30, 2012

 




 

 

 

 

Financial Highlights

BlackRock MuniAssets Fund, Inc. (MUA)


 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Period
June 1,
2008 to
April 30,
2009

 

 

 

 

 

 

 

 

Year Ended
May 31,

 

 

 

Year Ended April 30,

 

 

 

 

 

2012

 

2011

 

2010

 

 

2008

 

2007

 

Per Share Operating Performance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net asset value, beginning of period

 

$

12.14

 

$

12.63

 

$

10.59

 

$

12.79

 

$

13.87

 

$

13.65

 

Net investment income1

 

 

0.76

 

 

0.73

 

 

0.80

 

 

0.72

 

 

0.78

 

 

0.82

 

Net realized and unrealized gain (loss)

 

 

1.32

 

 

(0.46

)

 

2.06

 

 

(2.18

)

 

(1.04

)

 

0.24

 

Net increase (decrease) from investment operations

 

 

2.08

 

 

0.27

 

 

2.86

 

 

(1.46

)

 

(0.26

)

 

1.06

 

Dividends and distributions from:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net investment income

 

 

(0.75

)

 

(0.76

)

 

(0.82

)

 

(0.74

)

 

(0.82

)

 

(0.84

)

Net realized gain

 

 

 

 

 

 

 

 

 

 

(0.00

)2

 

 

Total dividends and distributions

 

 

(0.75

)

 

(0.76

)

 

(0.82

)

 

(0.74

)

 

(0.82

)

 

(0.84

)

Net asset value, end of period

 

$

13.47

 

$

12.14

 

$

12.63

 

$

10.59

 

$

12.79

 

$

13.87

 

Market price, end of period

 

$

13.15

 

$

11.27

 

$

12.65

 

$

10.91

 

$

13.35

 

$

15.29

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Investment Return3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Based on net asset value

 

 

17.90

%

 

2.31

%

 

27.72

%

 

(11.29

)%4

 

(1.90

)%

 

7.72

%

Based on market price

 

 

23.99

%

 

(5.17

)%

 

24.17

%

 

(12.45

)%4

 

(7.12

)%

 

14.71

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ratios to Average Net Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total expenses

 

 

0.77

%

 

0.78

%

 

0.72

%

 

0.77

%5

 

0.70

%

 

0.68

%

Total expenses after fees waived and paid indirectly

 

 

0.77

%

 

0.78

%

 

0.72

%

 

0.76

%5

 

0.69

%

 

0.68

%

Total expenses after fees waived and paid indirectly and excluding interest expense and fees6

 

 

0.70

%

 

0.74

%

 

0.67

%

 

0.70

%5

 

0.66

%

 

0.68

%

Net investment income

 

 

6.00

%

 

6.07

%

 

6.72

%

 

7.13

%5

 

5.81

%

 

5.91

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Supplemental Data

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net assets, end of period (000)

 

$

481,598

 

$

433,891

 

$

266,831

 

$

221,899

 

$

266,913

 

$

287,367

 

Portfolio turnover

 

 

28

%

 

24

%

 

44

%

 

23

%

 

23

%

 

25

%


 

 

1

Based on average shares outstanding.

 

 

2

Amount is less than $(0.01) per share.

 

 

3

Total investment returns based on market value, which can be significantly greater or lesser than the net asset value, may result in substantially different returns. Where applicable, total investment returns exclude the effects of any sales charges and include the reinvestment of dividends and distributions.

 

 

4

Aggregate total investment return.

 

 

5

Annualized.

 

 

6

Interest expense and fees relate to TOBs. See Note 1 of the Notes to Financial Statements for details of municipal bonds transferred to TOBs.


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

55




 

 

 

 

Financial Highlights

BlackRock MuniEnhanced Fund, Inc. (MEN)


 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Period
February 1,
2009 to
April 30,
2009

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended
January 31,

 

 

Year Ended April 30,

 

 

 

 

 

2012

 

2011

 

2010

 

 

2009

 

2008

 

Per Share Operating Performance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net asset value, beginning of period

 

$

10.30

 

$

10.90

 

$

9.77

 

$

9.15

 

$

11.16

 

$

11.55

 

Net investment income1

 

 

0.69

 

 

0.73

 

 

0.75

 

 

0.18

 

 

0.72

 

 

0.78

 

Net realized and unrealized gain (loss)

 

 

1.82

 

 

(0.62

)

 

1.04

 

 

0.58

 

 

(2.02

)

 

(0.41

)

Dividends to AMPS shareholders from net investment income

 

 

(0.00

)2

 

(0.03

)

 

(0.03

)

 

(0.01

)

 

(0.19

)

 

(0.24

)

Net increase (decrease) from investment operations

 

 

2.51

 

 

0.08

 

 

1.76

 

 

0.75

 

 

(1.49

)

 

0.13

 

Dividends to Common Shareholders from net investment income

 

 

(0.69

)

 

(0.68

)

 

(0.63

)

 

(0.13

)

 

(0.52

)

 

(0.52

)

Net asset value, end of period

 

$

12.12

 

$

10.30

 

$

10.90

 

$

9.77

 

$

9.15

 

$

11.16

 

Market price, end of period

 

$

11.66

 

$

9.99

 

$

10.81

 

$

8.88

 

$

8.31

 

$

10.66

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Investment Return Applicable to Common Shareholders3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Based on net asset value

 

 

25.12

%

 

0.78

%

 

18.76

%

 

8.40

%4

 

(13.19

)%

 

1.44

%

Based on market price

 

 

24.11

%

 

(1.44

)%

 

29.59

%

 

8.48

%4

 

(17.46

)%

 

3.92

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ratios to Average Net Assets Applicable to Common Shareholders

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total expenses5

 

 

1.70

%

 

1.24

%

 

1.20

%

 

1.46

%6

 

1.77

%

 

1.72

%

Total expenses after fees waived and paid indirectly5

 

 

1.70

%

 

1.24

%

 

1.20

%

 

1.45

%6

 

1.76

%

 

1.72

%

Total expenses after fees waived and paid indirectly and excluding interest expense, fees and amortization of offering costs5,7

 

 

1.35

%8

 

1.09

%

 

1.04

%

 

1.22

%6

 

1.18

%

 

1.08

%

Net investment income5

 

 

6.12

%

 

6.89

%

 

7.17

%

 

7.72

%6

 

7.43

%

 

6.85

%

Dividends to AMPS Shareholders

 

 

0.03

%

 

0.29

%

 

0.32

%

 

0.56

%6

 

1.92

%

 

2.08

%

Net investment income to Common Shareholders

 

 

6.09

%

 

6.60

%

 

6.85

%

 

7.16

%6

 

5.51

%

 

4.77

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Supplemental Data

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net assets applicable to Common Shareholders, end of period (000)

 

$

357,017

 

$

303,264

 

$

320,083

 

$

287,078

 

$

368,689

 

$

327,711

 

AMPS outstanding at $25,000 liquidation preference, end of period (000)

 

 

 

$

142,575

 

$

142,575

 

$

158,850

 

$

158,850

 

$

187,000

 

VRDP Shares outstanding at $100,000 liquidation value, end of period (000)

 

$

142,500

 

 

 

 

 

 

 

 

 

 

 

Portfolio turnover

 

 

22

%

 

9

%

 

23

%

 

6

%

 

24

%

 

18

%

Asset coverage per AMPS at $25,000 liquidation preference, end of period

 

 

 

$

78,179

 

$

81,128

 

$

70,185

 

$

67,294

 

$

68,834

 

Asset coverage per VRDP Shares at $100,000 liquidation value, end of period

 

$

350,538

 

 

 

 

 

 

 

 

 

 

 


 

 

1

Based on average Common Shares outstanding.

 

 

2

Amount is less than $(0.01) per share.

 

 

3

Total investment returns based on market value, which can be significantly greater or lesser than the net asset value, may result in substantially different returns. Where applicable, total investment returns exclude the effects of any sales charges and include the reinvestment of dividends and distributions.

 

 

4

Aggregate total investment return.

 

 

5

Do not reflect the effect of dividends to AMPS Shareholders.

 

 

6

Annualized.

 

 

7

Interest expense, fees and amortization of offering costs relate to TOBs and/or VRDP Shares. See Note 1 and Note 7 of the Notes to Financial Statements for details of municipal bonds transferred to TOBs and VRDP Shares, respectively.

 

 

8

For the year ended April 30, 2012, the total expense ratio after fees waived and paid indirectly and excluding interest expense, fees, amortization of offering costs, liquidity and remarketing fees was 0.98%.


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

56

 

ANNUAL REPORT

APRIL 30, 2012




 

 

 

 

Financial Highlights

BlackRock MuniHoldings Fund, Inc. (MHD)


 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended April 30,

 

 

 

2012

 

2011

 

2010

 

2009

 

2008

 

Per Share Operating Performance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net asset value, beginning of year

 

$

14.67

 

$

15.75

 

$

13.27

 

$

15.20

 

$

16.51

 

Net investment income1

 

 

1.12

 

 

1.14

 

 

1.13

 

 

1.07

 

 

1.16

 

Net realized and unrealized gain (loss)

 

 

2.67

 

 

(1.01

)

 

2.39

 

 

(1.94

)

 

(1.20

)

Dividends and distributions to AMPS shareholders from:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net investment income

 

 

(0.01

)

 

(0.03

)

 

(0.03

)

 

(0.18

)

 

(0.31

)

Net realized gain

 

 

 

 

(0.00

)2

 

(0.00

)2

 

(0.01

)

 

(0.03

)

Net increase (decrease) from investment operations

 

 

3.78

 

 

0.10

 

 

3.49

 

 

(1.06

)

 

(0.38

)

Dividends and distributions to Common Shareholders from:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net investment income

 

 

(1.09

)

 

(1.07

)

 

(0.99

)

 

(0.85

)

 

(0.85

)

Net realized gain

 

 

 

 

(0.11

)

 

(0.02

)

 

(0.02

)

 

(0.08

)

Total dividends and distributions to Common Shareholders

 

 

(1.09

)

 

(1.18

)

 

(1.01

)

 

(0.87

)

 

(0.93

)

Net asset value, end of year

 

$

17.36

 

$

14.67

 

$

15.75

 

$

13.27

 

$

15.20

 

Market price, end of year

 

$

18.08

 

$

14.51

 

$

15.70

 

$

11.97

 

$

14.77

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Investment Return Applicable to Common Shareholders3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Based on net asset value

 

 

26.57

%

 

0.57

%

 

27.31

%

 

(6.24

)%

 

(2.08

)%

Based on market price

 

 

33.28

%

 

(0.21

)%

 

40.68

%

 

(12.97

)%

 

(4.74

)%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ratios to Average Net Assets Applicable to Common Shareholders

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total expenses4

 

 

1.41

%

 

1.28

%

 

1.25

%

 

1.65

%

 

1.56

%

Total expenses after fees waived and paid indirectly4

 

 

1.41

%

 

1.28

%

 

1.25

%

 

1.64

%

 

1.56

%

Total expenses after fees waived and paid indirectly and excluding interest expense, fees and amortization of offering costs4,5

 

 

1.09

%6

 

1.13

%

 

1.11

%

 

1.25

%

 

1.20

%

Net investment income4

 

 

6.95

%

 

7.41

%

 

7.67

%

 

7.98

%

 

7.27

%

Dividends to AMPS Shareholders

 

 

0.09

%

 

0.20

%

 

0.24

%

 

1.32

%

 

1.96

%

Net investment income to Common Shareholders

 

 

6.86

%

 

7.21

%

 

7.43

%

 

6.66

%

 

5.31

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Supplemental Data

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net assets applicable to Common Shareholders, end of year (000)

 

$

243,989

 

$

205,368

 

$

219,133

 

$

184,685

 

$

211,429

 

AMPS outstanding at $25,000 liquidation preference, end of year (000)

 

 

 

$

83,700

 

$

83,700

 

$

91,925

 

$

125,000

 

VMTP Shares outstanding at $100,000 liquidation value, end of year (000)

 

$

83,700

 

 

 

 

 

 

 

 

 

Portfolio turnover

 

 

19

%

 

15

%

 

41

%

 

19

%

 

30

%

Asset coverage per AMPS at $25,000 liquidation preference, end of year

 

 

 

$

86,342

 

$

90,454

 

$

75,230

 

$

67,294

 

Asset coverage per VMTP Shares at $100,000 liquidation value, end of year

 

$

391,505

 

 

 

 

 

 

 

 

 


 

 

1

Based on average Common Shares outstanding.

 

 

2

Amount is less than $(0.01) per share.

 

 

3

Total investment returns based on market value, which can be significantly greater or lesser than the net asset value, may result in substantially different returns. Where applicable, total investment returns exclude the effects of any sales charges and include the reinvestment of dividends and distributions.

 

 

4

Do not reflect the effects of dividends to AMPS Shareholders.

 

 

5

Interest expense, fees and amortization of offering costs relate to TOBs and/or VMTP Shares. See Note 1 and Note 7 of the Notes to Financial Statements for details of municipal bonds transferred to TOBs and VMTP Shares, respectively.

 

 

6

For the year ended April 30, 2012, the total expense ratio after fees waived and paid indirectly and excluding interest expense, fees, amortization of offering costs, liquidity and remarketing fees was 1.05%.


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

57




 

 

 

 

Financial Highlights

BlackRock MuniHoldings Fund II, Inc. (MUH)


 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Period
August 1,
2008 to
April 30,
2009

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended
July 31,

 

 

Year Ended April 30,

 

 

 

 

 

2012

 

2011

 

2010

 

 

2008

 

2007

 

Per Share Operating Performance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net asset value, beginning of period

 

$

13.74

 

$

14.65

 

$

12.47

 

$

13.66

 

$

14.78

 

$

14.82

 

Net investment income1

 

 

1.03

 

 

1.03

 

 

1.02

 

 

0.72

 

 

1.04

 

 

1.05

 

Net realized and unrealized gain (loss)

 

 

2.45

 

 

(0.88

)

 

2.08

 

 

(1.22

)

 

(1.14

)

 

(0.05

)

Dividends and distributions to AMPS Shareholders from:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net investment income

 

 

(0.01

)

 

(0.02

)

 

(0.02

)

 

(0.10

)

 

(0.26

)

 

(0.27

)

Net realized gain

 

 

 

 

(0.00

)2

 

 

 

 

 

 

 

 

Net increase (decrease) from investment operations

 

 

3.47

 

 

0.13

 

 

3.08

 

 

(0.60

)

 

(0.36

)

 

0.73

 

Dividends and distributions to Common Shareholders from:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net investment income

 

 

(0.98

)

 

(0.97

)

 

(0.90

)

 

(0.59

)

 

(0.76

)

 

(0.77

)

Net realized gain

 

 

 

 

(0.07

)

 

 

 

 

 

 

 

 

Total dividends and distributions to Common Shareholders

 

 

(0.98

)

 

(1.04

)

 

(0.90

)

 

(0.59

)

 

(0.76

)

 

(0.77

)

Net asset value, end of period

 

$

16.23

 

$

13.74

 

$

14.65

 

$

12.47

 

$

13.66

 

$

14.78

 

Market price, end of period

 

$

16.46

 

$

13.35

 

$

14.68

 

$

11.33

 

$

13.01

 

$

13.99

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Investment Return Applicable to Common Shareholders3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Based on net asset value

 

 

26.08

%

 

0.92

%

 

25.71

%

 

(3.55

)%4

 

(2.30

)%

 

5.08

%

Based on market price

 

 

31.60

%

 

(2.14

)%

 

38.64

%

 

(7.99

)%4

 

(1.69

)%

 

4.39

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ratio to Average Net Assets Applicable to Common Shareholders

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total expenses5

 

 

1.37

%

 

1.23

%

 

1.25

%

 

1.60

%6

 

1.55

%

 

1.63

%

Total expenses after fees waived5

 

 

1.37

%

 

1.23

%

 

1.25

%

 

1.60

%6

 

1.55

%

 

1.63

%

Total expenses after fees waived and excluding interest expense, fees and amortization of offering costs5,7

 

 

1.07

%8

 

1.07

%

 

1.10

%

 

1.22

%6

 

1.18

%

 

1.19

%

Net investment income5

 

 

6.81

%

 

7.18

%

 

7.41

%

 

7.84

%6

 

7.07

%

 

6.97

%

Dividends to AMPS Shareholders

 

 

0.05

%

 

0.14

%

 

0.16

%

 

1.07

%6

 

1.79

%

 

1.82

%

Net investment income to Common Shareholders

 

 

6.76

%

 

7.04

%

 

7.25

%

 

6.77

%6

 

5.28

%

 

5.15

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Supplemental Data

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net assets applicable to Common Shareholders, end of period (000)

 

$

182,624

 

$

154,259

 

$

163,722

 

$

139,377

 

$

152,633

 

$

165,185

 

AMPS outstanding at $25,000 liquidation preference, end of period (000)

 

 

 

$

55,050

 

$

55,050

 

$

61,000

 

$

61,000

 

$

87,000

 

VMTP Shares outstanding at $100,000 liquidation value, end of period (000)

 

$

55,000

 

 

 

 

 

 

 

 

 

 

 

Portfolio turnover

 

 

18

%

 

15

%

 

41

%

 

19

%

 

28

%

 

15

%

Asset coverage per AMPS at $25,000 liquidation preference, end of period

 

 

 

$

95,056

 

$

99,353

 

$

81,123

 

$

87,562

 

$

72,478

 

Asset coverage per VMTP Shares at $100,000 liquidation value, end of period

 

$

432,044

 

 

 

 

 

 

 

 

 

 

 


 

 

1

Based on average Common Shares outstanding.

 

 

2

Amount is less than $(0.01) per share.

 

 

3

Total investment returns based on market value, which can be significantly greater or lesser than the net asset value, may result in substantially different returns. Where applicable, total investment returns exclude the effects of any sales charges and include the reinvestment of dividends and distributions.

 

 

4

Aggregate total investment return.

 

 

5

Do not reflect the effect of dividends to AMPS Shareholders.

 

 

6

Annualized.

 

 

7

Interest expense, fees and amortization of offering costs relate to TOBs and/or VMTP Shares. See Note 1 and Note 7 of the Notes to Financial Statements for details of municipal bonds transferred to TOBs and VMTP Shares, respectively.

 

 

8

For the year ended April 30, 2012, the total expense ratio after fees waived and paid indirectly and excluding interest expense, fees, amortization of offering costs, liquidity and remarketing fees was 1.03%.


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

58

 

ANNUAL REPORT

APRIL 30, 2012




 

 

 

 

Financial Highlights

BlackRock MuniHoldings Quality Fund, Inc. (MUS)


 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended April 30,

 

 

 

2012

 

2011

 

2010

 

2009

 

2008

 

Per Share Operating Performance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net asset value, beginning of year

 

$

12.48

 

$

13.34

 

$

12.27

 

$

13.31

 

$

14.10

 

Net investment income1

 

 

0.89

 

 

0.91

 

 

0.94

 

 

0.93

 

 

1.05

 

Net realized and unrealized gain (loss)

 

 

2.14

 

 

(0.85

)

 

0.97

 

 

(1.20

)

 

(0.87

)

Dividends to AMPS Shareholders from net investment income

 

 

(0.01

)

 

(0.03

)

 

(0.03

)

 

(0.19

)

 

(0.38

)

Net increase (decrease) from investment operations

 

 

3.02

 

 

0.03

 

 

1.88

 

 

(0.46

)

 

(0.20

)

Dividends to Common Shareholders from net investment income

 

 

(0.89

)

 

(0.89

)

 

(0.81

)

 

(0.58

)

 

(0.59

)

Net asset value, end of year

 

$

14.61

 

$

12.48

 

$

13.34

 

$

12.27

 

$

13.31

 

Market price, end of year

 

$

14.52

 

$

12.31

 

$

13.40

 

$

10.87

 

$

11.97

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Investment Return Applicable to Common Shareholders2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Based on net asset value

 

 

24.96

%

 

0.21

%

 

16.05

%

 

(2.52

)%

 

(0.95

)%

Based on market price

 

 

25.90

%

 

(1.60

)%

 

31.59

%

 

(3.97

)%

 

(4.34

)%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ratio to Average Net Assets Applicable to Common Shareholders

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total expenses3

 

 

1.49

%

 

1.34

%

 

1.36

%

 

1.88

%

 

1.64

%

Total expenses after fees waived3

 

 

1.41

%

 

1.25

%

 

1.20

%

 

1.65

%

 

1.51

%

Total expenses after fees waived and excluding interest expense, fees and amortization of offering costs3,4

 

 

1.06

%5

 

1.10

%

 

1.04

%

 

1.17

%

 

1.27

%

Net investment income3

 

 

6.50

%

 

7.04

%

 

7.23

%

 

7.69

%

 

7.72

%

Dividends to AMPS Shareholders

 

 

0.08

%

 

0.21

%

 

0.24

%

 

1.61

%

 

2.80

%

Net investment income to Common Shareholders

 

 

6.42

%

 

6.83

%

 

6.99

%

 

6.08

%

 

4.92

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Supplemental Data

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net assets applicable to Common Shareholders, end of year (000)

 

$

189,567

 

$

161,720

 

$

171,977

 

$

158,061

 

$

171,510

 

AMPS outstanding at $25,000 liquidation preference, end of year (000)

 

 

 

$

87,000

 

$

87,000

 

$

94,200

 

$

134,000

 

VMTP Shares outstanding at $100,000 liquidation value, end of year (000)

 

$

87,000

 

 

 

 

 

 

 

 

 

Portfolio turnover

 

 

30

%

 

28

%

 

22

%

 

35

%

 

57

%

Asset coverage per AMPS at $25,000 liquidation preference, end of year

 

 

 

$

71,472

 

$

74,420

 

$

66,951

 

$

57,008

 

Asset coverage per VMTP Shares at $100,000 liquidation value, end of year

 

$

317,893

 

 

 

 

 

 

 

 

 


 

 

 

 

1

Based on average Common Shares outstanding.

 

 

 

 

2

Total investment returns based on market value, which can be significantly greater or lesser than the net asset value, may result in substantially different returns. Where applicable, total investment returns exclude the effects of any sales charges and include the reinvestment of dividends and distributions.

 

 

 

 

3

Do not reflect the effect of dividends to AMPS Shareholders.

 

 

 

 

4

Interest expense, fees and amortization of offering costs relate to TOBs and/or VMTP Shares. See Note 1 and Note 7 of the Notes to Financial Statements for details of municipal bonds transferred to TOBs and VMTP Shares, respectively.

 

 

 

 

5

For the year ended April 30, 2012, the total expense ratio after fees waived and paid indirectly and excluding interest expense, fees, amortization of offering costs, liquidity and remarketing fees was 1.01%.


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

59




 

 

 

 

Financial Highlights

BlackRock Muni Intermediate Duration Fund, Inc. (MUI)


 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Period
June 1,
2008 to
April 30,
2009

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended April 30,

 

 

Year Ended
May 31,

 

 

 

2012

 

2011

 

2010

 

 

2008

 

2007

 

Per Share Operating Performance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net asset value, beginning of period

 

$

14.45

 

$

14.75

 

$

13.05

 

$

14.45

 

$

15.10

 

$

15.07

 

Net investment income1

 

 

0.86

 

 

0.95

 

 

1.02

 

 

0.89

 

 

1.04

 

 

1.03

 

Net realized and unrealized gain (loss)

 

 

1.76

 

 

(0.31

)

 

1.57

 

 

(1.42

)

 

(0.63

)

 

0.18

 

Dividends and distributions to AMPS Shareholders from:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net investment income

 

 

 

 

(0.10

)

 

(0.11

)

 

(0.23

)

 

(0.33

)

 

(0.28

)

Net realized gain

 

 

 

 

 

 

 

 

 

 

 

 

(0.04

)

Net increase (decrease) from investment operations

 

 

2.62

 

 

0.54

 

 

2.48

 

 

(0.76

)

 

0.08

 

 

0.89

 

Dividends and distributions to Common Shareholders from:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net investment income

 

 

(0.86

)

 

(0.84

)

 

(0.78

)

 

(0.64

)

 

(0.73

)

 

(0.74

)

Net realized gain

 

 

 

 

 

 

 

 

 

 

 

 

(0.12

)

Total dividends and distributions to Common Shareholders

 

 

(0.86

)

 

(0.84

)

 

(0.78

)

 

(0.64

)

 

(0.73

)

 

(0.86

)

Net asset value, end of period

 

$

16.21

 

$

14.45

 

$

14.75

 

$

13.05

 

$

14.45

 

$

15.10

 

Market price, end of period

 

$

16.45

 

$

13.65

 

$

14.13

 

$

11.77

 

$

13.70

 

$

14.85

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Investment Return Applicable to Common Shareholders2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Based on net asset value

 

 

18.74

%

 

3.86

%

 

19.85

%

 

(4.56

)%3

 

0.86

%

 

6.14

%

Based on market price

 

 

27.56

%

 

2.41

%

 

27.29

%

 

(9.21

)%3

 

(2.76

)%

 

8.34

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ratios to Average Net Assets Applicable to Common Shareholders

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total expenses4

 

 

1.88

%

 

1.45

%

 

1.20

%

 

1.44

%5

 

1.30

%

 

1.31

%

Total expenses after fees waived and paid indirectly4

 

 

1.88

%

 

1.43

%

 

1.10

%

 

1.25

%5

 

1.07

%

 

1.07

%

Total expenses after fees waived and paid indirectly and excluding interest expense, fees and amortization of offering costs4,6

 

 

1.65

%7

 

1.30

%

 

1.01

%

 

1.02

%5

 

0.90

%

 

0.87

%

Net investment income4

 

 

5.58

%

 

6.48

%

 

7.22

%

 

7.46

%5

 

6.97

%

 

6.71

%

Dividend to AMPS Shareholders

 

 

 

 

0.70

%

 

0.81

%

 

1.94

%5

 

2.23

%

 

1.80

%

Net investment income to Common Shareholders

 

 

5.58

%

 

5.78

%

 

6.41

%

 

5.52

%5

 

4.74

%

 

4.91

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Supplemental Data

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net assets applicable to Common Shareholders, end of period (000)

 

$

617,437

 

$

549,516

 

$

561,140

 

$

496,247

 

$

549,415

 

$

574,225

 

AMPS outstanding at $25,000 liquidation preference, end of period (000)

 

 

 

 

 

$

287,175

 

$

287,175

 

$

320,000

 

$

320,000

 

VRDP Shares outstanding at $100,000 liquidation value, end of period (000)

 

$

287,100

 

$

287,100

 

 

 

 

 

 

 

 

 

Portfolio turnover

 

 

27

%

 

21

%

 

29

%

 

13

%

 

14

%

 

12

%

Asset coverage per AMPS at $25,000 liquidation preference, end of period

 

 

 

 

 

$

73,857

 

$

68,207

 

$

67,941

 

$

69,875

 

Asset coverage per VRDP Shares at $100,000 liquidation value, end of period

 

$

315,060

 

$

291,402

 

 

 

 

 

 

 

 

 


 

 

 

 

1

Based on average Common Shares outstanding.

 

 

 

 

2

Total investment returns based on market value, which can be significantly greater or lesser than the net asset value, may result in substantially different returns. Where applicable, total investment returns exclude the effects of any sales charges and include the reinvestment of dividends and distributions.

 

 

 

 

3

Aggregate total investment return.

 

 

 

 

4

Do not reflect the effect of dividends to AMPS Shareholders.

 

 

 

 

5

Annualized.

 

 

 

 

6

Interest expense, fees and amortization of offering costs relate to TOBs and/or VRDP Shares. See Note 1 and Note 7 of the Notes to Financial Statements for details of municipal bonds transferred to TOBs and VRDP Shares, respectively.

 

 

 

 

7

For the year ended April 30, 2012, the total expense ratio after fees waived and paid indirectly and excluding interest expense, fees, amortization of offering costs, liquidity and remarketing fees was 0.99%.


 

 

 

See Notes to Financial Statements.

 

 

 

60

ANNUAL REPORT

APRIL 30, 2012




 

 

 

 

Financial Highlights

BlackRock MuniVest Fund II, Inc. (MVT)


 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Period
November 1,
2008 to
April 30,
2009

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended April 30,

 

 

Year Ended
October 31,

 

 

 

2012

 

2011

 

2010

 

 

2008

 

2007

 

Per Share Operating Performance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net asset value, beginning of period

 

$

13.47

 

$

14.41

 

$

11.95

 

$

10.95

 

$

14.49

 

$

15.35

 

Net investment income1

 

 

1.12

 

 

1.14

 

 

1.18

 

 

0.53

 

 

1.12

 

 

1.16

 

Net realized and unrealized gain (loss)

 

 

2.41

 

 

(0.99

)

 

2.32

 

 

0.95

 

 

(3.49

)

 

(0.84

)

Dividends to AMPS Shareholders from net investment income

 

 

(0.02

)

 

(0.04

)

 

(0.05

)

 

(0.05

)

 

(0.32

)

 

(0.32

)

Net increase (decrease) from investment operations

 

 

3.51

 

 

0.11

 

 

3.45

 

 

1.43

 

 

(2.69

)

 

 

Dividends to Common Shareholders from net investment income

 

 

(1.07

)

 

(1.05

)

 

(0.99

)

 

(0.43

)

 

(0.85

)

 

(0.86

)

Net asset value, end of period

 

$

15.91

 

$

13.47

 

$

14.41

 

$

11.95

 

$

10.95

 

$

14.49

 

Market price, end of period

 

$

16.75

 

$

13.72

 

$

14.94

 

$

11.65

 

$

9.75

 

$

13.91

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Investment Return Applicable to Common Shareholders2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Based on net asset value

 

 

26.86

%

 

0.73

%

 

29.75

%

 

13.71

%3

 

(19.33

)%

 

(0.02

)%

Based on market price

 

 

31.13

%

 

(1.04

)%

 

37.99

%

 

24.49

%3

 

(25.18

)%

 

(9.56

)%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ratio to Average Net Assets Applicable to Common Shareholders

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total expenses4

 

 

1.41

%

 

1.23

%

 

1.25

%

 

1.51

%5

 

1.67

%

 

1.67

%

Total expenses after fees waived and excluding interest expense, fees and amortization of offering costs4,6

 

 

1.04

%7

 

1.07

%

 

1.10

%

 

1.26

%5

 

1.16

%

 

1.12

%

Net investment income4

 

 

7.57

%

 

8.14

%

 

8.72

%

 

9.77

%5

 

8.03

%

 

7.74

%

Dividends to AMPS Shareholders

 

 

0.15

%

 

0.32

%

 

0.36

%

 

0.95

%5

 

2.31

%

 

2.11

%

Net investment income to Common Shareholders

 

 

7.42

%

 

7.82

%

 

8.36

%

 

8.82

%5

 

5.72

%

 

5.63

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Supplemental Data

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net assets applicable to Common Shareholders, end of period (000)

 

$

330,941

 

$

278,284

 

$

295,465

 

$

243,583

 

$

223,210

 

$

293,836

 

AMPS outstanding at $25,000 liquidation preference, end of period (000)

 

 

 

$

140,000

 

$

140,000

 

$

150,800

 

$

150,800

 

$

175,000

 

VMTP Shares outstanding at $100,000 liquidation value, end of period (000)

 

$

140,000

 

 

 

 

 

 

 

 

 

 

 

Portfolio turnover

 

 

13

%

 

16

%

 

30

%

 

9

%

 

49

%

 

43

%

Asset coverage per AMPS at $25,000 liquidation preference, end of period

 

 

 

$

74,698

 

$

77,767

 

$

65,388

 

$

62,019

 

$

67,004

 

Asset coverage per VMTP Shares at $100,000 liquidation value, end of period

 

$

336,386

 

 

 

 

 

 

 

 

 

 

 


 

 

 

 

1

Based on average Common Shares outstanding.

 

 

 

 

2

Total investment returns based on market value, which can be significantly greater or lesser than the net asset value, may result in substantially different returns. Where applicable, total investment returns exclude the effects of any sales charges and include the reinvestment of dividends and distributions.

 

 

 

 

3

Aggregate total investment return.

 

 

 

 

4

Do not reflect the effect of dividends to AMPS Shareholders.

 

 

 

 

5

Annualized.

 

 

 

 

6

Interest expense, fees and amortization of offering costs relate to TOBs and/or VMTP Shares. See Note 1 and Note 7 of the Notes to Financial Statements for details of municipal bonds transferred to TOBs and VMTP Shares, respectively.

 

 

 

 

7

For the year ended April 30, 2012, the total expense ratio after fees waived and paid indirectly and excluding interest expense, fees, amortization of offering costs, liquidity and remarketing fees was 0.99%.


 

 

 

 

See Notes to Financial Statements.

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

61




 

 

Notes to Financial Statements

1. Organization and Significant Accounting Policies:

BlackRock MuniAssets Fund, Inc. (“MUA”), BlackRock MuniEnhanced Fund, Inc. (“MEN”), BlackRock MuniHoldings Fund, Inc. (“MHD”), BlackRock Muni-Holdings Fund II, Inc. (“MUH”), BlackRock MuniHoldings Quality Fund, Inc. (“MUS”), BlackRock Muni Intermediate Duration Fund, Inc. (“MUI”) and BlackRock MuniVest Fund II, Inc. (“MVT”) (collectively, the “Funds”) are registered under the 1940 Act, as non-diversified, closed-end management investment companies. The Funds are organized as Maryland corporations. The Funds’ financial statements are prepared in conformity with accounting principles generally accepted in the United States of America (“US GAAP”), which may require management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements. Actual results could differ from those estimates. The Boards of Directors of the Funds are collectively referred to throughout this report as “Board of Directors” or the “Board,” and the directors thereof are collectively referred to throughout this report as “Directors.” The Funds determine and make available for publication the NAVs of their Common Shares on a daily basis.

The following is a summary of significant accounting policies followed by the Funds:

Reorganization: The Board and shareholders of MUA and the Board and shareholders of BlackRock Apex Municipal Fund, Inc. (“APX”) approved the reorganization of APX into MUA pursuant to which MUA acquired substantially all of the assets and substantially all of the liabilities of APX in exchange for an equal aggregate value of newly-issued Common Shares of MUA.

Each Common Shareholder of APX received Common Shares of MUA in an amount equal to the aggregate net asset value of such Common Shareholder’s APX Common Shares, as determined at the close of business on February 25, 2011, less the costs of APX’s reorganization (although cash was distributed for any fractional Common Shares).

The reorganization was accomplished by a tax-free exchange of Common Shares of MUA in the following amounts and at the following conversion ratio:

 

 

 

 

 

 

 

 

 

 

 

Target Fund

 

Shares Prior to
Reorganization

 

Conversion
Ratio

 

Shares of
MUA

 

APX

 

 

19,990,638

 

 

0.72861057

 

 

14,565,391

 

APX’s net assets and composition of net assets on February 25, 2011, the date of the merger, were as follows:

 

 

 

 

 

 

 

 

 

 

 

Target Fund

 

Net Assets
Applicable to
Common
Shareholders

 

Paid-in
Capital

 

Undistributed
Net Investment
Income

 

APX

 

$

176,471,885

 

$

192,252,646

 

$

670,780

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Target Fund

 

 

 

 

Accumulated
Net
Realized Loss

 

Net Unrealized
Depreciation

 

APX

 

 

 

 

$

(8,314,694

)

$

(8,136,847

)

For financial reporting purposes, assets received and shares issued by MUA were recorded at fair value; however, the cost basis of the investments received from APX was carried forward to align ongoing reporting of MUA’s realized and unrealized gains and losses with amounts distributable to shareholders for tax purposes. The aggregate net assets of MUA immediately after the acquisition amounted to $433,042,831. APX’s fair value and cost of investments prior to the reorganization was $173,035,802 and $181,172,649, respectively.

The purpose of this transaction was to combine two funds managed by the Manager (as defined in Note 3 below) with the same or substantially similar (but not identical) investment objectives, investment policies, strategies, risks and restrictions. The reorganization was a tax-free event and was effective on February 28, 2011.

Assuming the acquisition had been completed on May 1, 2010, the beginning of the annual reporting period of MUA, the pro forma results of operations for the year ended April 30, 2011, are as follows:

 

 

Net investment income: $26,815,648

 

 

Net realized and change in unrealized gain on investments: $(16,410,597)

 

 

Net increase in net assets applicable to Common Shareholders resulting from operations: $10,405,051

Because the combined investment portfolios have been managed as a single integrated portfolio since the acquisition was completed, it is not practicable to separate the amounts of revenue and earnings of MUA that have been included in MUA’s Statement of Operations since February 25, 2011.

Valuation: US GAAP defines fair value as the price the Funds would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. The Funds fair value their financial instruments at market value using independent dealers or pricing services under policies approved by each Fund’s Board. Municipal investments (including commitments to purchase such investments on a “when-issued” basis) are valued on the basis of prices provided by dealers or pricing services. In determining the value of a particular investment, pricing services may use certain information with respect to transactions in such investments, quotations from dealers, pricing matrixes, market transactions in comparable investments and information with respect to various relationships between investments. Financial futures contracts traded on exchanges are valued at their last sale price. Investments in open-end registered investment companies are valued at NAV each business day. Short-term securities with remaining maturities of 60 days or less may be valued at amortized cost, which approximates fair value.

In the event that application of these methods of valuation results in a price for an investment which is deemed not to be representative of the market value of such investment or if a price is not available, the investment will be valued in accordance with a policy approved by the Board as reflecting fair value (“Fair Value Assets”). When determining the price for Fair Value Assets, the investment advisor and/or the sub-advisor seeks to determine the price that each Fund might reasonably expect to receive from the current sale of

 

 

 

 

 

 

62

ANNUAL REPORT

APRIL 30, 2012




 

 

Notes to Financial Statements (continued)

that asset in an arm’s-length transaction. Fair value determinations shall be based upon all available factors that the investment advisor and/or sub-advisor deems relevant. The pricing of all Fair Value Assets is subsequently reported to the Board or a committee thereof.

Zero-Coupon Bonds: The Funds may invest in zero-coupon bonds, which are normally issued at a significant discount from face value and do not provide for periodic interest payments. Zero-coupon bonds may experience greater volatility in market value than similar maturity debt obligations which provide for regular interest payments.

Forward Commitments and When-Issued Delayed Delivery Securities: The Funds may purchase securities on a when-issued basis and may purchase or sell securities on a forward commitment basis. Settlement of such transactions normally occurs within a month or more after the purchase or sale commitment is made. The Funds may purchase securities under such conditions with the intention of actually acquiring them, but may enter into a separate agreement to sell the securities before the settlement date. Since the value of securities purchased may fluctuate prior to settlement, the Funds may be required to pay more at settlement than the security is worth. In addition, the Funds are not entitled to any of the interest earned prior to settlement. When purchasing a security on a delayed delivery basis, the Funds assume the rights and risks of ownership of the security, including the risk of price and yield fluctuations. In the event of default by the counterparty, the Funds’ maximum amount of loss is the unrealized appreciation of unsettled when-issued transactions, which is shown in the Schedules of Investments.

Municipal Bonds Transferred to TOBS: The Funds leverage their assets through the use of TOBs. A TOB is established by a third party sponsor forming a special purpose entity, into which a fund, or an agent on behalf of a fund, transfers municipal bonds. Other funds managed by the investment advisor may also contribute municipal bonds to a TOB into which a Fund has contributed bonds. A TOB typically issues two classes of beneficial interests: short-term floating rate certificates, which are sold to third party investors, and residual certificates (“TOB Residuals”), which are generally issued to the participating funds that made the transfer. The TOB Residuals held by a Fund include the right of a Fund (1) to cause the holders of a proportional share of the short-term floating rate certificates to tender their certificates at par, including during instances of a rise in short-term interest rates, and (2) to transfer, within seven days, a corresponding share of the municipal bonds from the TOB to a Fund. The TOB may also be terminated without the consent of a Fund upon the occurrence of certain events as defined in the TOB agreements. Such termination events may include the bankruptcy or default of the municipal bond, a substantial downgrade in credit quality of the municipal bond, the inability of the TOB to obtain quarterly or annual renewal of the liquidity support agreement, a substantial decline in market value of the municipal bond or the inability to remarket the short-term floating rate certificates to third party investors. During the year ended April 30, 2012, no TOBs in which the Funds participated were terminated without the consent of the Funds.

The cash received by the TOB from the sale of the short-term floating rate certificates, less transaction expenses, is paid to a Fund in exchange for TOB trust certificates. The Funds typically invest the cash in additional municipal bonds. Each Fund’s transfer of the municipal bonds to a TOB is accounted for as a secured borrowing; therefore, the municipal bonds deposited into a TOB are presented in the Funds’ Schedules of Investments and TOB trust certificates are shown in other liabilities in the Statements of Assets and Liabilities. The carrying amount of each Fund’s payable to the holder of the short-term floating rate certificates as reported in the Funds’ Statements of Assets and Liabilities as TOB trust certificates approximates its fair value.

Interest income, including amortization and accretion of premiums and discounts, from the underlying municipal bonds is recorded by the Funds on an accrual basis. Interest expense incurred on the secured borrowing and other expenses related to remarketing, administration and trustee services to a TOB are shown as interest expense, fees and amortization of offering costs in the Statements of Operations. The short-term floating rate certificates have interest rates that generally reset weekly and their holders have the option to tender certificates to the TOB for redemption at par at each reset date. At April 30, 2012, the aggregate value of the underlying municipal bonds transferred to TOBs, the related liability for TOB trust certificates and the range of interest rates on the liability for trust certificates were as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

Underlying
Municipal
Bonds
Transferred to
TOBs

 

Liability for
TOB Trust
Certificates

 

Range of
Interest
Rates

 

MUA

 

$

115,642,317

 

$

61,510,427

 

 

0.25% – 0.40

%

MEN

 

$

144,293,917

 

$

69,282,084

 

 

0.25% – 0.40

%

MHD

 

$

116,895,356

 

$

61,757,895

 

 

0.22% – 0.40

%

MUH

 

$

91,396,926

 

$

48,273,237

 

 

0.22% – 0.40

%

MUS

 

$

82,099,025

 

$

41,631,272

 

 

0.24% – 0.47

%

MUI

 

$

155,658,272

 

$

81,429,692

 

 

0.20% – 0.40

%

MVT

 

$

168,164,662

 

$

88,539,873

 

 

0.24% – 0.42

%

For the year ended April 30, 2012, the Funds’ average TOB trust certificates outstanding and the daily weighted average interest rate, including fees, were as follows:

 

 

 

 

 

 

 

 

 

 

Average TOB Trust
Certificates
Outstanding

 

Daily Weighted
Average
Interest Rate

 

MUA

 

$

39,509,700

 

 

0.82

%

MEN

 

$

65,174,093

 

 

0.65

%

MHD

 

$

49,506,179

 

 

0.70

%

MUH

 

$

38,623,061

 

 

0.69

%

MUS

 

$

34,391,779

 

 

0.66

%

MUI

 

$

70,869,516

 

 

0.68

%

MVT

 

$

72,112,534

 

 

0.70

%

Should short-term interest rates rise, the Funds’ investments in TOBs may adversely affect the Funds’ net investment income and dividends to Common Shareholders. Also, fluctuations in the market value of municipal bonds deposited into the TOB may adversely affect the Funds’ NAVs per share.

Segregation and Collateralization: In cases in which the 1940 Act and the interpretive positions of the Securities and Exchange Commission (“SEC”) require that the Funds either deliver collateral or segregate assets in connection with certain investments (e.g., financial futures contracts), the Funds will, consistent with SEC rules and/or certain interpretive letters issued by the SEC, segregate collateral or designate on their books and records cash

 

 

 

 

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

63




 

 

Notes to Financial Statements (continued)

or liquid securities having a market value at least equal to the amount that would otherwise be required to be physically segregated. Furthermore, based on requirements and agreements with certain exchanges and third party broker-dealers, each party to such transactions has requirements to deliver/deposit securities as collateral for certain investments.

Investment Transactions and Investment Income: For financial reporting purposes, investment transactions are recorded on the dates the transactions are entered into (the trade dates). Realized gains and losses on investment transactions are determined on the identified cost basis. Dividend income is recorded on the ex-dividend dates. Interest income, including amortization and accretion of premiums and discounts on debt securities, is recognized on the accrual basis.

Dividends and Distributions: Dividends from net investment income are declared and paid monthly. Distributions of capital gains are recorded on the ex-dividend dates. The amount and timing of dividends and distributions are determined in accordance with federal income tax regulations, which may differ from US GAAP. Dividends and distributions to Preferred Shareholders are accrued and determined as described in Note 7.

Income Taxes: It is each Fund’s policy to comply with the requirements of the Internal Revenue Code of 1986, as amended, applicable to regulated investment companies and to distribute substantially all of its taxable income to its shareholders. Therefore, no federal income tax provision is required.

Each Fund files US federal and various state and local tax returns. No income tax returns are currently under examination. The statute of limitations on the Funds’ US federal tax returns remains open for each of the following periods:

 

 

 

 

 

 

 

Year Ended

 

Period Ended

MUA

 

April 30, 2012

 

June 1, 2008 to

 

 

April 30, 2011

 

April 30, 2009

 

 

April 30, 2010

 

 

 

 

 

 

 

MEN

 

April 30, 2012

 

February 1, 2009 to

 

 

April 30, 2011

 

April 30, 2009

 

 

April 30, 2010

 

 

 

 

January 31, 2009

 

 

 

 

 

 

 

MHD

 

April 30, 2012

 

N/A

 

 

April 30, 2011

 

 

 

 

April 30, 2010

 

 

 

 

April 30, 2009

 

 

 

 

 

 

 

MUH

 

April 30, 2012

 

August 1, 2008 to

 

 

April 30, 2011

 

April 30, 2009

 

 

April 30, 2010

 

 

 

 

 

 

 

MUS

 

April 30, 2012

 

N/A

 

 

April 30, 2011

 

 

 

 

April 30, 2010

 

 

 

 

April 30, 2009

 

 

 

 

 

 

 

MUI

 

April 30, 2012

 

June 1, 2008 to

 

 

April 30, 2011

 

April 30, 2009

 

 

April 30, 2010

 

 

 

 

 

 

 

MVT

 

April 30, 2012

 

November 1, 2008

 

 

April 30, 2011

 

to April 30, 2009

 

 

April 30, 2010

 

 

 

 

October 31, 2008

 

 

The statutes of limitations on each Fund’s state and local tax returns may remain open for an additional year depending upon the jurisdiction.

Management does not believe there are any uncertain tax positions that require recognition of a tax liability.

Recent Accounting Standards: In May 2011, the Financial Accounting Standards Board (the “FASB”) issued amended guidance to improve disclosure about fair value measurements, which will require the following disclosures for fair value measurements categorized as Level 3: quantitative information about the unobservable inputs and assumptions used in the fair value measurement, a description of the valuation policies and procedures and a narrative description of the sensitivity of the fair value measurement to changes in unobservable inputs and the interrelationships between those unobservable inputs. In addition, the amounts and reasons for all transfers in and out of Level 1 and Level 2 will be required to be disclosed as well as disclosure of the level in the fair value hierarchy of assets and liabilities not recorded at fair value but where fair value is disclosed. The amended guidance is effective for financial statements for fiscal years beginning after December 15, 2011, and interim periods within those fiscal years. Management is evaluating the impact of this guidance on the Funds’ financial statement disclosures.

In December 2011, the FASB issued guidance that will expand current disclosure requirements on the offsetting of certain assets and liabilities. The new disclosures will be required for investments and derivative financial instruments subject to master netting or similar agreements, which are eligible for offset in the Statements of Assets and Liabilities and will require an entity to disclose both gross and net information about such investments and transactions in the financial statements. The guidance is effective for financial statements with fiscal years beginning on or after January 1, 2013, and interim periods within those fiscal years. Management is evaluating the impact of this guidance on the Funds’ financial statement disclosures.

Deferred Compensation and BlackRock Closed-End Share Equivalent Investment Plan: Under the deferred compensation plan approved by each Fund’s Board, independent Directors (“Independent Directors”) may defer a portion of their annual complex-wide compensation. Deferred amounts earn an approximate return as though equivalent dollar amounts had been invested in common shares of certain other BlackRock Closed-End Funds selected by the Independent Directors. This has approximately the same economic effect for the Independent Directors as if the Independent Directors had invested the deferred amounts directly in certain other BlackRock Closed-End Funds.

The deferred compensation plan is not funded and obligations thereunder represent general unsecured claims against the general assets of each Fund. Prior to March 31, 2012, each Fund elected to invest in common shares of certain other BlackRock Closed-End Funds selected by the Independent Directors in order to match its deferred compensation obligations and dividends and distributions received from the BlackRock Closed-End Fund investments through March 31, 2012 are included in income — affiliated in the Statements of Operations.

Offering Costs: Each fund, except MUA, incurred costs in connection with their issuance of VRDP Shares or VMTP Shares. For VRDP Shares, these costs were recorded as a deferred charge and will be amortized over the 30-year life of the VRDP Shares with the exception of upfront fees paid to the liquidity provider which are amortized over the life of the liquidity agreement. For

 

 

 

 

 

 

64

ANNUAL REPORT

APRIL 30, 2012




 

 

Notes to Financial Statements (continued)

VMTP Shares, these costs were recorded as a deferred charge and will be amortized over the 3-year life of the VMTP Shares. Amortization of these costs is included in interest expense, fees and amortization of offering costs in the Statements of Operations.

Other: Expenses directly related to a Fund are charged to that Fund. Other operating expenses shared by several funds are pro rated among those funds on the basis of relative net assets or other appropriate methods.

The Funds have an arrangement with the custodians whereby fees may be reduced by credits earned on uninvested cash balances, which, if applicable, are shown as fees paid indirectly in the Statements of Operations. The custodians impose fees on overdrawn cash balances, which can be offset by accumulated credits earned or may result in additional custody charges.

2. Derivative Financial Instruments:

The Funds engage in various portfolio investment strategies using derivative contracts both to increase the returns of the Funds and/or to economically hedge, or protect, their exposure to certain risks such as interest rate risk. These contracts may be transacted on an exchange.

Losses may arise if the value of the contract decreases due to an unfavorable change in the market rates or values of the underlying instrument or if the counterparty does not perform under the contract. Counterparty risk related to exchange-traded financial futures contracts is deemed to be minimal due to the protection against defaults provided by the exchange on which these contracts trade.

Financial Futures Contracts: The Funds purchase or sell financial futures contracts and options on financial futures contracts to gain exposure to, or economically hedge against, changes in interest rates (interest rate risk). Financial futures contracts are agreements between the Funds and the counterparty to buy or sell a specific quantity of an underlying instrument at a specified price and at a specified date. Depending on the terms of the particular contract, financial futures contracts are settled either through physical delivery of the underlying instrument on the settlement date or by payment of a cash settlement amount on the settlement date. Pursuant to the contract, the Funds agree to receive from or pay to the broker an amount of cash equal to the daily fluctuation in value of the contract. Such receipts or payments are known as variation margin and are recorded by the Funds as unrealized appreciation or depreciation. When the contract is closed, the Funds record a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the value at the time it was closed. The use of financial futures contracts involves the risk of an imperfect correlation in the movements in the price of financial futures contracts, interest or foreign currency exchange rates and the underlying assets.

Derivative Financial Instruments Categorized by Risk Exposure:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fair Values of Derivative Financial Instruments as of April 30, 2012

 

 

 

 

Liability Derivatives

 

 

 

 

MUA

 

MEN

 

MHD

 

MUH

 

MUS

 

MUI

 

MVT

 

 

Statements of Assets
and Liabilities Location

 

Value

Interest rate contracts

 

Net unrealized
appreciation/
depreciation1

 

$

(480,188

)

$

(316,943

)

$

(346,118

)

$

(261,175

)

$

(285,365

)

$

(1,393,556

)

$

(470,479

)


 

 

 

 

1

Includes cumulative appreciation/depreciation on financial futures contracts as reported in the Schedules of Investments. Only current day’s variation margin is reported within the Statements of Assets and Liabilities.


 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The Effect of Derivative Financial Instruments in the Statements of Operations
Year Ended April 30, 2012

 

 

 

Net Realized Gain (Loss) From

 

 

 

MUA

 

MEN

 

MHD

 

MUH

 

MUS

 

MUI

 

MVT

 

Interest rate contracts:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Financial future contracts

 

$

(1,193,801

)

$

(2,084,916

)

$

(1,227,256

)

$

(879,309

)

$

(764,976

)

$

(1,700,081

)

$

(2,077,178

)


 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Change in Unrealized Appreciation/Depreciation on

 

 

 

MUA

 

MEN

 

MHD

 

MUH

 

MUS

 

MUI

 

MVT

 

Interest rate contracts:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Financial future contracts

 

$

(175,468

)

$

129,630

 

$

53,171

 

$

38,292

 

$

(127,751

)

$

(652,770

)

$

65,409

 

For the year ended April 30, 2012, the average quarterly balances of outstanding derivative financial instruments were as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MUA

 

MEN

 

MHD

 

MUH

 

MUS

 

MUI

 

MVT

 

Financial future contracts:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average number of contracts sold

 

 

133

 

 

103

 

 

96

 

 

72

 

 

77

 

 

272

 

 

142

 

Average notional value of contracts sold

 

$

17,403,281

 

$

13,278,281

 

$

12,568,516

 

$

9,338,891

 

$

10,099,438

 

$

35,669,188

 

$

18,496,305

 


 

 

 

 

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

65




 

 

Notes to Financial Statements (continued)

3. Investment Advisory Agreement and Other Transactions with Affiliates:

As of April 30, 2012, the PNC Financial Services Group, Inc. (“PNC”) and Barclays Bank PLC (“Barclays”) are the largest stockholders of BlackRock, Inc. (“BlackRock”). Due to the ownership structure, PNC is an affiliate for 1940 Act purposes, but Barclays is not.

Each Fund entered into an Investment Advisory Agreement with BlackRock Advisors, LLC (the “Manager”), the Funds’ investment advisor, an indirect, wholly owned subsidiary of BlackRock, to provide investment advisory and administration services. The Manager is responsible for the management of each Fund’s portfolio and provides the necessary personnel, facilities, equipment and certain other services necessary to the operations of each Fund. For such services, each Fund pays the Manager a monthly fee based on a percentage of each Fund’s average daily net assets at the following annual rates:

 

 

 

 

 

MUA

 

 

0.55

%

MEN

 

 

0.50

%

MHD

 

 

0.55

%

MUH

 

 

0.55

%

MUS

 

 

0.55

%

MUI

 

 

0.55

%

MVT

 

 

0.50

%

Average daily net assets are the average daily value of each Fund’s total assets minus the sum of its accrued liabilities.

The Manager, for MUS, voluntarily agreed to waive its investment advisory fee on the proceeds of the Preferred Shares and TOBs that exceed 35% of total assets minus the sum of its accrued liabilities. This amount is included in fees waived by advisor in the Statements of Operations. For the year ended April 30, 2012, the waiver was $141,441.

The Manager voluntarily agreed to waive its investment advisory fees by the amount of investment advisory fees each Fund pays to the Manager indirectly through its investment in affiliated money market funds. However, the Manager does not waive its investment advisory fees by the amount of investment advisory fees paid through each Fund’s investment in other affiliated investment companies, if any. These amounts are included in fees waived by advisor in the Statements of Operations. For the year ended April 30, 2012, the amounts waived were as follows:

 

 

 

 

 

MUA

 

$

2,291

 

MEN

 

$

4,467

 

MHD

 

$

2,427

 

MUH

 

$

1,250

 

MUS

 

$

3,814

 

MUI

 

$

9,017

 

MVT

 

$

3,241

 

The Manager entered into a sub-advisory agreement with BlackRock Investment Management, LLC (“BIM”), an affiliate of the Manager. The Manager pays BIM, for services it provides, a monthly fee that is a percentage of the investment advisory fees paid by each Fund to the Manager.

Certain officers and/or Directors of the Funds are officers and/or directors of BlackRock or its affiliates. The Funds reimburse the Manager for compensation paid to the Funds’ Chief Compliance Officer.

4. Investments:

Purchases and sales of investments, excluding short-term securities for the year ended April 30, 2012, were as follows:

 

 

 

 

 

 

 

 

 

 

Purchases

 

Sales

 

MUA

 

$

175,366,677

 

$

136,067,783

 

MEN

 

$

114,531,590

 

$

114,274,621

 

MHD

 

$

88,466,749

 

$

67,605,641

 

MUH

 

$

64,890,845

 

$

47,477,613

 

MUS

 

$

102,227,829

 

$

88,121,750

 

MUI

 

$

280,397,606

 

$

251,088,329

 

MVT

 

$

100,843,731

 

$

67,942,749

 

5. Income Tax Information:

US GAAP requires that certain components of net assets be adjusted to reflect permanent differences between financial and tax reporting. These reclassifications have no effect on net assets or net asset values per share. The following permanent differences as of April 30, 2012 attributable to amortization methods on fixed income securities, distributions received from a regulated investment company, the sale of bonds received from tender option bond trusts, and the expiration of capital loss carryforwards were reclassified to the following accounts:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MUA

 

MEN

 

MHD

 

MUH

 

MUS

 

MUI

 

MVT

 

Paid-in capital

 

 

 

$

(364,714

)

 

 

 

 

 

 

 

 

 

 

Undistributed net investment income

 

$

(48,799

)

$

(13,910

)

$

27,215

 

$

21,493

 

$

434

 

$

(321,623

)

$

(565,353

)

Undistributed net realized gain (accumulated net realized loss)

 

$

48,799

 

$

378,624

 

$

(27,215

)

$

(21,493

)

$

(434

)

$

321,623

 

$

565,353

 


 

 

 

 

 

 

 

 

66

ANNUAL REPORT

APRIL 30, 2012

 




 

 

Notes to Financial Statements (continued)

The tax character of distributions paid during the fiscal years ended April 30, 2012 and April 30, 2011 was as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MUA

 

MEN

 

MHD

 

MUH

 

MUS

 

MUI

 

MVT

 

Tax-exempt income

 

04/30/12

 

$

26,806,448

 

$

21,041,552

 

$

15,837,794

 

$

11,353,000

 

$

12,032,695

 

$

33,498,893

 

$

23,223,910

 

 

 

04/30/11

 

 

17,692,426

 

 

21,012,520

 

 

15,260,047

 

 

11,057,513

 

 

11,844,227

 

 

36,127,151

 

 

22,581,030

 

Ordinary income

 

04/30/12

 

 

119,408

 

 

 

 

58,968

 

 

39,399

 

 

 

 

42,826

 

 

25,448

 

 

 

04/30/11

 

 

259,963

 

 

 

 

571,786

 

 

88,940

 

 

 

 

14,580

 

 

15,877

 

Long-term capital gains

 

04/30/12

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

04/30/11

 

 

 

 

 

 

1,085,502

 

 

765,730

 

 

 

 

 

 

 

Total

 

04/30/12

 

$

26,925,856

 

$

21,041,552

 

$

15,896,762

 

$

11,392,399

 

$

12,032,695

 

$

33,541,719

 

$

23,249,358

 

 

 

04/30/11

 

$

17,952,389

 

$

21,012,520

 

$

16,917,335

 

$

11,912,183

 

$

11,844,227

 

$

36,141,731

 

$

22,596,907

 

As of April 30, 2012, the tax components of accumulated net earnings were as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MUA

 

MEN

 

MHD

 

MUH

 

MUS

 

MUI

 

MVT

 

Undistributed tax-exempt income

 

$

973,433

 

$

5,916,597

 

$

4,064,508

 

$

3,536,152

 

$

3,279,729

 

$

8,377,114

 

$

5,452,488

 

Undistributed ordinary income

 

 

622,494

 

 

6,540

 

 

11,513

 

 

508,007

 

 

 

 

67,600

 

 

15,774

 

Undistributed long-term capital gains

 

 

 

 

 

 

1,464,070

 

 

361,857

 

 

 

 

 

 

 

Capital loss carryforwards

 

 

(18,654,945

)

 

(9,804,716

)

 

 

 

 

 

(12,809,109

)

 

(560,259

)

 

(4,998,176

)

Net unrealized gains1

 

 

19,259,273

 

 

45,663,584

 

 

29,040,868

 

 

23,522,272

 

 

24,366,406

 

 

69,655,129

 

 

46,873,122

 

Qualified late-year losses2

 

 

 

 

 

 

 

 

 

 

 

 

(1,303,775

)

 

(915,127

)

Total

 

$

2,200,255

 

$

41,782,005

 

$

34,580,959

 

$

27,928,288

 

$

14,837,026

 

$

76,235,809

 

$

46,428,081

 


 

 

 

 

1

The difference between book-basis and tax-basis net unrealized gains was attributable primarily to the tax deferral of losses on wash sales, amortization and accretion methods of premiums and discounts on fixed income securities, the accrual of income on securities in default, the realization for tax purposes of unrealized gains/losses on certain futures contracts, the deferral of compensation to trustees and the treatment of residual interests in tender option bond trusts.

 

 

 

 

2

The Funds have elected to defer certain qualified late-year losses and recognize such losses in the year ending April 30, 2013.

As of April 30, 2012, the Funds had capital loss carryforwards available to offset future realized capital gains through the indicated expiration dates as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expires April 30,

 

MUA

 

MEN

 

MUS

 

MUI

 

MVT

 

2013

 

$

3,378,868

 

 

 

 

 

 

 

 

 

2014

 

 

3,072,949

 

 

 

 

 

 

 

 

 

2015

 

 

5,065,527

 

 

 

 

 

 

 

 

 

2016

 

 

901,327

 

$

2,508,309

 

$

166,265

 

 

 

$

4,202,338

 

2017

 

 

3,645,754

 

 

3,540,378

 

 

5,373,343

 

 

 

 

 

2018

 

 

396,366

 

 

1,225,298

 

 

6,614,798

 

$

560,259

 

 

 

2019

 

 

2,194,154

 

 

732,655

 

 

 

 

 

 

 

No expiration date3

 

 

 

 

1,798,076

 

 

654,703

 

 

 

 

795,838

 

Total

 

$

18,654,945

 

$

9,804,716

 

$

12,809,109

 

$

560,259

 

$

4,998,176

 


 

 

 

 

3

Must be utilized prior to losses subject to expiration.

As of April 30, 2012, gross unrealized appreciation and gross unrealized depreciation based on cost for federal income tax purposes were as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MUA

 

MEN

 

MHD

 

MUH

 

MUS

 

MUI

 

MVT

 

Tax cost

 

$

453,313,675

 

$

449,035,643

 

$

294,515,313

 

$

212,283,585

 

$

250,815,212

 

$

835,870,839

 

$

424,802,889

 

Gross unrealized appreciation

 

$

42,905,040

 

$

46,581,071

 

$

32,395,833

 

$

24,653,417

 

$

24,773,905

 

$

72,641,704

 

$

52,129,616

 

Gross unrealized depreciation

 

 

(23,092,145

)

 

(840,462

)

 

(3,228,365

)

 

(1,131,197

)

 

(407,501

)

 

(2,860,091

)

 

(4,441,315

)

Net unrealized appreciation

 

$

19,812,895

 

$

45,740,609

 

$

29,167,468

 

$

23,522,220

 

$

24,366,404

 

$

69,781,613

 

$

47,688,301

 


 

 

 

 

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

67




 

 

Notes to Financial Statements (continued)

6. Concentration, Market and Credit Risk:

MEN, MHD, MUH, MUS, MUI and MVT invest a substantial amount of their assets in issuers located in a single state or limited number of states. Please see the Schedules of Investments for concentrations in specific states.

Many municipalities insure repayment of their bonds, which may reduce the potential for loss due to credit risk. The market value of these bonds may fluctuate for other reasons, including market perception of the value of such insurance, and there is no guarantee that the insurer will meet its obligation.

In the normal course of business, the Funds invest in securities and enter into transactions where risks exist due to fluctuations in the market (market risk) or failure of the issuer of a security to meet all its obligations (issuer credit risk). The value of securities held by the Funds may decline in response to certain events, including those directly involving the issuers whose securities are owned by the Funds; conditions affecting the general economy; overall market changes; local, regional or global political, social or economic instability; and currency and interest rate and price fluctuations. Similar to issuer credit risk, the Funds may be exposed to counterparty credit risk, or the risk that an entity with which the Funds have unsettled or open transactions may fail to or be unable to perform on its commitments. The Funds manage counterparty credit risk by entering into transactions only with counterparties that they believe have the financial resources to honor their obligations and by monitoring the financial stability of those counterparties. Financial assets, which potentially expose the Funds to market, issuer and counterparty credit risks, consist principally of financial instruments and receivables due from counterparties. The extent of the Funds’ exposure to market, issuer and counterparty credit risks with respect to these financial assets is generally approximated by their value recorded in the Funds’ Statements of Assets and Liabilities, less any collateral held by the Funds.

As of April 30, 2012, MHD, MUH and MVT invested a significant portion of its assets in securities in the health sector. MUA invested a significant portion of its assets in securities in the health and transportation sectors. MEN and MUS invested a significant portion of its assets in securities in the county/city/special district/school district and transportation sectors. MUI invested a significant portion of its assets in securities in the county/city/special district/school district and state sectors. Changes in economic conditions affecting the county/city/special district/school district, health, state and transportation sectors would have a greater impact on the Funds and could affect the value, income and/or liquidity of positions in such securities.

7. Capital Share Transactions:

Each Fund is authorized to issue 200 million shares, all of which were initially classified as Common Shares. The par value for each Fund’s Common Shares is $0.10. The par value for each Fund’s Preferred Shares is $0.10 except MEN Series A, B and C, which is $0.025 and MVT Series A, B and C, which is $0.05. The Board is authorized, however, to reclassify any unissued Common Shares to Preferred Shares without approval of Common Shareholders.

Common Shares

For the years shown, shares issued and outstanding increased by the following amounts as a result of dividend reinvestment:

 

 

 

 

 

 

 

 

 

 

Year Ended
April 30, 2012

 

Year Ended
April 30, 2011

 

MUA

 

 

 

 

52,762

 

MEN

 

 

12,832

 

 

83,278

 

MHD

 

 

56,498

 

 

82,143

 

MUH

 

 

24,312

 

 

52,545

 

MUS

 

 

17,824

 

 

61,762

 

MUI

 

 

45,759

 

 

 

MVT

 

 

139,364

 

 

158,460

 

Preferred Shares

Each Fund’s Preferred Shares rank prior to the Fund’s Common Shares as to the payment of dividends by the Fund and distribution of assets upon dissolution or liquidation of the Funds. The 1940 Act prohibits the declaration of any dividend on the Funds’ Common Shares or the repurchase of the Funds’ Common Shares if the Funds fail to maintain the asset coverage of at least 200% of the liquidation preference of the outstanding Preferred Shares. In addition, pursuant to the Preferred Shares’ governing instrument, the Funds are restricted from declaring and paying dividends on classes of shares ranking junior to or on parity with the Preferred Shares or repurchasing such shares if the Funds fail to declare and pay dividends on the Preferred Shares, redeem any Preferred Shares required to be redeemed under the Preferred Shares governing instrument or comply with the basic maintenance amount requirement of the rating agencies then rating the Preferred Shares.

The holders of Preferred Shares have voting rights equal to the holders of Common Shares (one vote per share) and will vote together with holders of Common Shares (one vote per share) as a single class. However, the holders of Preferred Shares, voting as a separate class, are also entitled to elect two Directors for each Fund. In addition, the 1940 Act requires that along with approval by shareholders that might otherwise be required, the approval of the holders of a majority of any outstanding Preferred Shares, voting separately as a class would be required to (a) adopt any plan of reorganization that would adversely affect the Preferred Shares, (b) change a Funds’ sub-classification as a closed-end investment company or change its fundamental investment restrictions or (c) change its business so as to cease to be an investment company.

VRDP Shares

MEN and MUI (collectively, the “VRDP Funds”), have issued Series W-7 VRDP Shares, $100,000 liquidation value per share, in a privately negotiated offering. The VRDP Shares were offered to qualified institutional buyers as defined pursuant to Rule 144A under the Securities Act of 1933 and include a liquidity feature that allows the holders of VRDP Shares to have their shares purchased by the liquidity provider in the event of a failed remarketing. The VRDP Funds are required to redeem the VRDP Shares owned by the liquidity provider after six months of continuous, unsuccessful remarketing. Upon the occurrence of the first unsuccessful remarketing, the VRDP Funds are required to segregate liquid assets to fund the redemption. The VRDP Shares are subject to certain restrictions on transfer.

 

 

 

 

 

 

68

ANNUAL REPORT

APRIL 30, 2012




 

 

Notes to Financial Statements (continued)

The VRDP Shares issued for the year ended April 30, 2012 were as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Issue
Date

 

Shares
Issued

 

Aggregate
Principal

 

Maturity Date

 

MEN

 

 

5/19/11

 

 

1,425

 

$

142,500,000

 

 

6/01/41

 

The VRDP Shares issued for the year ended April 30, 2011 were as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Issue
Date

 

Shares
Issued

 

Aggregate
Principal

 

Maturity Date

 

MUI

 

 

3/17/11

 

 

2,871

 

$

287,100,000

 

 

4/01/41

 

The VRDP Funds entered into a fee agreement with the liquidity provider that requires a per annum liquidity fee to be paid to the liquidity provider. These fees are shown as liquidity fees in the Statements of Operations.

The fee agreement between the VRDP Funds and the liquidity provider is for a 364 day term and is scheduled to expire on May 16, 2012 for MEN and December 28, 2012 for MUI unless renewed or terminated in advance. On April 9, 2012, MEN renewed the fee agreement with its liquidity provider which is scheduled to expire on May 14, 2013 unless renewed or terminated in advance. In the event the fee agreement is not renewed or is terminated in advance, and the VRDP Funds do not enter into a fee agreement with an alternate liquidity provider, the VRDP Shares will be subject to mandatory purchase by the liquidity provider prior to the termination of the fee agreement. The VRDP Funds are required to redeem any VRDP Shares purchased by the liquidity provider six months after the purchase date. Immediately after the purchase of any VRDP Shares by the liquidity provider, the VRDP Funds are required to begin to segregate liquid assets with the VRDP Funds’ custodians to fund the redemption. There is no assurance the VRDP Funds will replace such redeemed VRDP Shares with any other preferred shares or other form of leverage.

Each VRDP Fund is required to redeem its VRDP Shares on the maturity date, unless earlier redeemed or repurchased. Six months prior to the maturity date, each VRDP Fund is required to begin to segregate liquid assets with the Fund’s custodian to fund the redemption. In addition, the VRDP Funds are required to redeem certain of its outstanding VRDP Shares if it fails to maintain certain asset coverage, basic maintenance amount or leverage requirements.

Subject to certain conditions, VRDP Shares may be redeemed, in whole or in part, at any time at the option of the VRDP Funds. The redemption price per VRDP Share is equal to the liquidation value per share plus any outstanding unpaid dividends. In the event of an optional redemption of the VRDP Shares prior to the initial termination date of the fee agreement, the VRDP Funds must pay the respective liquidity provider fees on such redeemed VRDP Shares for the remaining term of the fee agreement up to the initial termination date.

Dividends on the VRDP Shares are payable monthly at a variable rate set weekly by the remarketing agent. Such dividend rates are generally based upon a spread over a base rate and cannot exceed a maximum rate. In the event of a failed remarketing, the dividend rate of the VRDP Shares will be reset to a maximum rate. The maximum rate is determined based on, among other things, the long-term preferred share rating assigned to the VRDP Shares and the length of time that the VRDP Shares fail to be remarketed. At the date of issuance, the VRDP Shares were assigned a long-term rating of Aaa from Moody’s and AAA from Fitch. As of April 30, 2012, the long-term ratings on the VRDP Shares remain unchanged. In May, Moody’s announced changes to its methodology for rating securities issued by registered closed-end funds, and it is currently reviewing all closed-end funds that it rates under the revised methodology for a possible downgrade.

The short-term ratings on the VRDP Shares are directly related to the short-term ratings of the liquidity provider for such VRDP Shares. Changes in the credit quality of the liquidity provider could cause a change in the short-term credit ratings of the VRDP Shares as rated by Moody’s, Fitch and S&P. A change in the short-term credit rating of the liquidity provider or the VRDP Shares may adversely affect the dividend rate paid on such shares, although the dividend rate paid on the VRDP Shares is not directly related based upon either short-term rating. On April 30, 2012, the short-term ratings of the liquidity provider and the VRDP Shares for MEN are P-1, F-1 and A-1 and MUI are P-1, F-1+ and Not Rated as rated by Moody’s, Fitch and/or S&P, respectively. As of June 22, 2012, the short-term rating of the liquidity provider and the VRDP Shares for MEN is P-2 as rated by Moody’s, which is within the two highest rating categories. The liquidity provider may be terminated prior to the scheduled termination date if the liquidity provider fails to maintain short-term debt ratings in one of the two highest rating categories.

For financial reporting purposes, VRDP Shares are considered debt of the issuer; therefore, the liquidation value which approximates fair value of VRDP Shares is recorded as a liability in the Statements of Assets and Liabilities. Unpaid dividends are included in interest expense and fees payable in the Statements of Assets and Liabilities, and the dividends paid on the VRDP Shares are included as a component of interest expense, fees and amortization of offering costs in the Statements of Operations. VRDP Shares are treated as equity for tax purposes. Dividends paid to holders of VRDP Shares are generally classified as tax-exempt income for tax-reporting purposes.

The VRDP Funds pay remarketing fees of 0.10% on the aggregate principal amount of all VRDP Shares, which are included in remarketing fees on Preferred Shares in the Statements of Operations. All of MEN and MUI’s VRDP Shares have successfully remarketed since issuance, with an annualized dividend rate of 0.29% for MEN and MUI, respectively, for the year ended April 30, 2012.

VRDP Shares issued and outstanding for MUI remained constant for the year ended April 30, 2012.

VMTP Shares

MHD, MUH, MUS and MVT (collectively, the “VMTP Funds”), have issued Series W-7 VMTP Shares, $100,000 liquidation value per share, in a privately negotiated offering and sale of VMTP Shares exempt from registration under the Securities Act of 1933.

 

 

 

 

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

69




 

 

Notes to Financial Statements (continued)

The VMTP Shares issued for the year ended April 30, 2012 were as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Issue
Date

 

Shares
Issued

 

Aggregate
Principal

 

Term Date

 

MHD

 

12/16/11

 

837

 

$

83,700,000

 

 

1/02/15

 

MUH

 

12/16/11

 

550

 

$

55,000,000

 

 

1/02/15

 

MUS

 

12/16/11

 

870

 

$

87,000,000

 

 

1/02/15

 

MVT

 

12/16/11

 

1,400

 

$

140,000,000

 

 

1/02/15

 

Each VMTP Fund is required to redeem its VMTP Shares on the term date, unless earlier redeemed or repurchased or unless extended. There is no assurance that the term of a Fund’s VMTP Shares will be extended or that a Fund’s VMTP Shares will be replaced with any other preferred shares or other form of leverage upon the redemption or repurchase of the VMTP Shares. Six months prior to term date, each VMTP Fund is required to begin to segregate liquid assets with the Fund’s custodian to fund the redemption. In addition, each VMTP Fund is required to redeem certain of its outstanding VMTP Shares if it fails to maintain certain asset coverage, basic maintenance amount or leverage requirements.

Subject to certain conditions, a Fund’s VMTP Shares may be redeemed, in whole or in part, at any time at the option of the Fund. The redemption price per VMTP Share is equal to the liquidation value per share plus any outstanding unpaid dividends and applicable redemption premium. If the Funds redeem the VMTP Shares on a date that is one year or more prior to the term date and the VMTP Shares are rated above A1/A+ by Moody’s and Fitch, respectively, then such redemption is subject to a prescribed redemption premium based on the time remaining to the term date, subject to certain exceptions for redemptions that are required to maintain minimum asset coverage requirements. The VMTP Shares are subject to certain restrictions on transfer, and a Fund may also be required to register the VMTP Shares for sale under the Securities Act of 1933 under certain circumstances. In addition, amendments to the VMTP governing document generally require the consent of the holders of VMTP Shares.

Dividends on the VMTP Shares are payable monthly at a variable rate set weekly at a fixed rate spread to the Securities Industry and Financial Markets Association Municipal Swap Index (SIFMA). The fixed spread is determined based on the long-term preferred share rating assigned to the VMTP Shares by Moody’s and Fitch. At the date of issuance, the VMTP Shares were assigned long-term ratings of Aaa from Moody’s and AAA from Fitch. As of April 30, 2012, the long-term ratings on the VMTP Shares remain unchanged. In May, Moody’s announced changes to its methodology for rating securities issued by registered closed-end funds, and it is currently reviewing all closed-end funds that it rates under the revised methodology for a possible downgrade. The dividend rate on the VMTP Shares is subject to a step-up spread if a Fund fails to comply with certain provisions, including, among other things, the timely payment of dividends, redemptions or gross-up payments, and maintaining certain asset coverage and leverage requirements.

The average annualized dividend rates of the VMTP Shares for the year ended April 30, 2012 were as follows:

 

 

 

 

 

MHD

 

 

1.14

%

MUH

 

 

1.14

%

MUS

 

 

1.14

%

MVT

 

 

1.14

%

For financial reporting purposes, VMTP Shares are considered debt of the issuer; therefore the liquidation value, which approximates fair value, of VMTP Shares is recorded as a liability in the Statements of Assets and Liabilities. Unpaid dividends are included in interest expense and fees payable in the Statements of Assets and Liabilities, and the dividends paid on the VMTP Shares are included as a component of interest expense, fees and amortization of offering costs in the Statements of Operations. VMTP Shares are treated as equity for tax purposes. Dividends paid to holders of VMTP Shares are generally classified as tax-exempt income for tax-reporting purposes.

AMPS

The AMPS are redeemable at the option of each Fund, in whole or in part, on any dividend payment date at their liquidation preference per share plus any accumulated and unpaid dividends whether or not declared. The AMPS are also subject to mandatory redemption at their liquidation preference plus any accumulated and unpaid dividends, whether or not declared, if certain requirements relating to the composition of the assets and liabilities of a Fund, as set forth in the Funds’ Articles Supplementary (the “Governing Instrument”) are not satisfied.

Dividends on seven-day and 28-day AMPS are cumulative at a rate which is reset every seven or 28 days, respectively, based on the results of an auction. If the AMPS fail to clear the auction on an auction date, each Fund is required to pay the maximum applicable rate on the AMPS to holders of such shares for successive dividend periods until such time as the shares are successfully auctioned. The low, high and average dividend rates on the AMPS for each Fund for the year ended April 30, 2012 were as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Series

 

 

Low

 

 

High

 

 

Average

 

MEN

 

 

A1

 

 

0.34

%

 

0.38

%

 

0.36

%

 

 

 

B1

 

 

0.32

%

 

0.40

%

 

0.36

%

 

 

 

C1

 

 

0.32

%

 

0.41

%

 

0.36

%

 

 

 

D2

 

 

1.32

%

 

1.47

%

 

1.40

%

MHD

 

 

A1

 

 

0.11

%

 

0.40

%

 

0.23

%

 

 

 

B1

 

 

0.11

%

 

0.41

%

 

0.23

%

 

 

 

C2

 

 

1.26

%

 

1.47

%

 

1.33

%

MUH

 

 

A1

 

 

0.11

%

 

0.40

%

 

0.23

%

 

 

 

B1

 

 

0.11

%

 

0.41

%

 

0.23

%

MUS

 

 

A1

 

 

0.11

%

 

0.41

%

 

0.23

%

 

 

 

B1

 

 

0.11

%

 

0.41

%

 

0.24

%

MVT

 

 

A1

 

 

0.12

%

 

0.37

%

 

0.25

%

 

 

 

B1

 

 

0.14

%

 

0.38

%

 

0.25

%

 

 

 

C1

 

 

0.11

%

 

0.41

%

 

0.23

%

 

 

 

D1

 

 

1.26

%

 

1.47

%

 

1.33

%


 

 

 

 

1

The maximum applicable rate on this series of AMPS is the higher of 110% of the AA commercial paper or 110% of 90% of the Kenny S&P 30-day High Grade Index rate divided by 1.00 minus the marginal tax rate.

 

 

 

 

2

The maximum applicable rate on this series of AMPS is the higher of 110% plus or times (i) the Telerate/BAA LIBOR or (ii) 90% of Kenny S&P 30-day High Grade Index rate divided by 1.00 minus the marginal tax rate.

Since February 13, 2008, the AMPS of the Funds failed to clear any of their auctions. As a result, the AMPS dividend rates were reset to the maximum applicable rate, which ranged from 0.11% to 1.47% for the year ended April 30, 2012. A failed auction is not an event of default for the Funds but it has a negative impact on the liquidity of AMPS. A failed auction occurs when there are more sellers of a Fund’s AMPS than buyers. A successful auction for the Funds’ AMPS may not occur for some time, if ever, and even if liquidity

 

 

 

 

 

 

70

ANNUAL REPORT

APRIL 30, 2012




 

 

Notes to Financial Statements (concluded)

does resume, holders of AMPS may not have the ability to sell the AMPS at their liquidation preference.

The Funds paid commissions of 0.15% on the aggregate principal amount of all shares that fail to clear their auctions and 0.25% on the aggregate principal amount of all shares that successfully clear their auctions. Certain broker dealers have individually agreed to reduce commissions for failed auctions. The commissions paid to these broker dealers are included in remarketing fees on Preferred Shares in the Statements of Operations.

During the year ended April 30, 2012, MEN, MHD, MUH, MUS and MVT announced the following redemptions of AMPS at a price of $25,000 per share plus any accrued and unpaid dividends through the redemption date:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Series

 

Redemption
Date

 

Shares
Redeemed

 

Aggregate
Principal

 

MEN

 

A28

 

6/14/11

 

 

 

1,525

 

 

$

38,125,000

 

 

 

B28

 

6/21/11

 

 

 

1,525

 

 

$

38,125,000

 

 

 

C7

 

5/31/11

 

 

 

1,525

 

 

$

38,125,000

 

 

 

D7

 

6/10/11

 

 

 

1,128

 

 

$

28,200,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MHD

 

A

 

1/11/12

 

 

 

1,473

 

 

$

36,825,000

 

 

 

B

 

1/06/12

 

 

 

1,473

 

 

$

36,825,000

 

 

 

C

 

1/10/12

 

 

 

402

 

 

$

10,050,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MUH

 

A

 

1/11/12

 

 

 

1,101

 

 

$

27,525,000

 

 

 

B

 

1/09/12

 

 

 

1,101

 

 

$

27,525,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MUS

 

A

 

1/06/12

 

 

 

1,740

 

 

$

43,500,000

 

 

 

B

 

1/10/12

 

 

 

1,740

 

 

$

43,500,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MVT

 

A

 

1/12/12

 

 

 

1,440

 

 

$

36,000,000

 

 

 

B

 

1/19/12

 

 

 

1,440

 

 

$

36,000,000

 

 

 

C

 

1/12/12

 

 

 

1,440

 

 

$

36,000,000

 

 

 

D

 

1/10/12

 

 

 

1,280

 

 

$

32,000,000

 

AMPS issued and outstanding remained constant during the year ended April 30, 2011 for MEN, MHD, MUH, MUS and MVT.

The Funds financed the AMPS redemptions with the proceeds received from the issuance of VRDP Shares or VMTP Shares as follows:

 

 

 

 

 

MEN

 

$

142,500,000

 

MHD

 

$

83,700,000

 

MUH

 

$

55,000,000

 

MUS

 

$

87,000,000

 

MVT

 

$

140,000,000

 

During the year ended April 30, 2011, MUI announced the following redemptions of AMPS at a price of $25,000 per share plus any accrued and unpaid dividends through the redemption period:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Series

 

Redemption
Date

 

Shares
Redeemed

 

Aggregate
Principal

 

MUI

 

M7

 

4/05/11

 

 

 

1,795

 

 

$

44,875,000

 

 

 

T7

 

4/06/11

 

 

 

2,423

 

 

$

60,575,000

 

 

 

W7

 

4/07/11

 

 

 

1,795

 

 

$

44,875,000

 

 

 

TH7

 

4/08/11

 

 

 

2,423

 

 

$

60,575,000

 

 

 

F7

 

4/04/11

 

 

 

1,795

 

 

$

44,875,000

 

 

 

TH28

 

4/08/11

 

 

 

1,256

 

 

$

31,400,000

 

MUI financed the AMPS redemptions with the proceeds received from the issuance of VRDP Shares of $287,100,000.

8. Subsequent Events:

Management’s evaluation of the impact of all subsequent events on the Funds’ financial statements was completed through the date the financial statements were issued and the following items were noted:

Each Fund paid a net investment income dividend on June 1, 2012 to Common Shareholders of record on May 15, 2012 as follows:

 

 

 

 

 

 

 

 

 

Common Dividend
Per Share

 

MUA

 

 

$

0.0625

 

 

MEN

 

 

$

0.0580

 

 

MHD

 

 

$

0.0915

 

 

MUH

 

 

$

0.0830

 

 

MUS

 

 

$

0.0740

 

 

MUI

 

 

$

0.0715

 

 

MVT

 

 

$

0.0910

 

 

Additionally, the Funds declared a net investment income dividend on June 1, 2012 payable to Common Shareholders of record on June 15, 2012 for the same amounts noted above.

The dividends declared on VRDP or VMTP Shares for the period May 1, 2012 to May 31, 2012 were as follows:

 

 

 

 

 

 

 

 

 

 

 

 

Series

 

VRDP/VMTP
Dividends
Declared

 

MEN VRDP Shares

 

 

W7

 

 

$

43,256

 

 

MHD VMTP Shares

 

 

W7

 

 

$

86,376

 

 

MUH VMTP Shares

 

 

W7

 

 

$

56,758

 

 

MUS VMTP Shares

 

 

W7

 

 

$

89,781

 

 

MUI VRDP Shares

 

 

W7

 

 

$

79,855

 

 

MVT VMTP Shares

 

 

W7

 

 

$

144,475

 

 

On June 8, 2012, MEN announced a proposed special rate period for its issued and outstanding VRDP Shares for a three year term ending June 24, 2015. On June 13, 2012, MEN announced a mandatory tender event effective June 20, 2012. The mandatory tender event is not the result of a failed remarketing. During the three-year term of the special rate period, MEN will not pay any liquidity and remarketing fees on the VRDP Shares and instead will pay dividends based on the sum of the SIFMA Municipal Swap Index and a percentage per annum based on the long-term ratings assigned to the VRDP Shares.

 

 

 

 

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

71




 

 

Report of Independent Registered Public Accounting Firm

To the Shareholders and Boards of Directors of:
BlackRock MuniAssets Fund, Inc.
BlackRock MuniEnhanced Fund, Inc.
BlackRock MuniHoldings Fund, Inc.
BlackRock MuniHoldings Fund II, Inc.
BlackRock MuniHoldings Quality Fund, Inc.
BlackRock Muni Intermediate Duration Fund, Inc.
BlackRock MuniVest Fund II, Inc.

We have audited the accompanying statements of assets and liabilities of BlackRock MuniAssets Fund, Inc., BlackRock MuniEnhanced Fund, Inc., BlackRock MuniHoldings Fund, Inc., BlackRock MuniHoldings Fund II, Inc., BlackRock MuniHoldings Quality Fund, Inc., BlackRock Muni Intermediate Duration Fund, Inc., and BlackRock MuniVest Fund II, Inc. (collectively, the “Funds”), including the schedules of investments, as of April 30, 2012, and the related statements of operations for the year then ended, the statements of cash flows of BlackRock MuniEnhanced Fund, Inc., BlackRock MuniHoldings Fund, Inc., BlackRock MuniHoldings Fund II, Inc., BlackRock MuniHoldings Quality Fund, Inc., BlackRock Muni Intermediate Duration Fund, Inc., and BlackRock MuniVest Fund II, Inc. for the year then ended, the statements 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 presented. These financial statements and financial highlights are the responsibility of the Funds’ 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 the standards of the Public Accounting Oversight Board (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. The Funds are not required to have, nor were we engaged to perform, an audit of their internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Funds’ internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of April 30, 2012, by correspondence with the custodians and brokers; where replies were not received from brokers, we performed other auditing procedures. 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 positions of BlackRock MuniAssets Fund, Inc., BlackRock MuniEnhanced Fund, Inc., BlackRock MuniHoldings Fund, Inc., BlackRock MuniHoldings Fund II, Inc., BlackRock MuniHoldings Quality Fund, Inc., BlackRock Muni Intermediate Duration Fund, Inc., and BlackRock MuniVest Fund II, Inc., as of April 30, 2012, the results of their operations for the year then ended, the statements of cash flows of BlackRock MuniEnhanced Fund, Inc., BlackRock MuniHoldings Fund, Inc., BlackRock MuniHoldings Fund II, Inc., BlackRock MuniHoldings Quality Fund, Inc., BlackRock Muni Intermediate Duration Fund, Inc., and BlackRock MuniVest Fund II, Inc. for the year then ended, the changes in their net assets for each of the two years in the period then ended, and the financial highlights for each of the periods presented, in conformity with accounting principles generally accepted in the United States of America.

Deloitte & Touche LLP
Boston, Massachusetts
June 22, 2012

 

 

 

 

 

 

72

ANNUAL REPORT

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Important Tax Information (Unaudited)

The following table summarizes the taxable per share distributions paid by MUA, MHD, MUH, MUI and MVT during the taxable year ended April 30, 2012.

 

 

 

 

 

 

 

 

MUA

 

Payable
Date

 

Ordinary
Income1

 

Common Shareholders

 

 

12/30/11

 

$

0.003341

 

MHD

 

 

 

 

 

 

 

Common Shareholders

 

 

12/30/11

 

$

0.004109

 

Preferred Shareholders:

 

 

 

 

 

 

 

Series A

 

 

12/07/11

 

$

0.29

 

Series B

 

 

12/09/11

 

$

0.29

 

Series C

 

 

12/06/11

 

$

1.24

 

MUH

 

 

 

 

 

 

 

Common Shareholders

 

 

12/30/11

 

$

0.003455

 

 

 

 

 

 

 

 

 

Preferred Shareholders:

 

 

 

 

 

 

 

Series A

 

 

12/07/11

 

$

0.28

 

Series B

 

 

12/05/11

 

$

0.28

 

MUI

 

 

 

 

 

 

 

Common Shareholders

 

 

12/30/11

 

$

0.001046

 

Preferred Shareholders:

 

 

 

 

 

 

 

Series W7

 

 

01/03/12

 

$

0.268548

 

MVT

 

 

 

 

 

 

 

Common Shareholders

 

 

12/30/11

 

$

0.001180

 

 

 

 

 

 

 

 

 

Preferred Shareholders:

 

 

 

 

 

 

 

Series A

 

 

12/15/11

 

$

0.10

 

Series B

 

 

12/22/11

 

$

0.10

 

Series C

 

 

12/08/11

 

$

0.10

 

Series D

 

 

12/06/11

 

$

0.40

 


 

 

 

 

1

Additionally, all ordinary income distributions are comprised of interest related dividends and qualified short-term capital gains for non-US residents and are eligible for exemption from US withholding tax for nonresident aliens and foreign corporations.

All other net investment income distributions paid by MUA, MEN, MHD, MUH, MUS, MUI and MVT during the taxable year ended April 30, 2012 qualify as tax-exempt interest dividends for federal income tax purposes.

 

 

 

 

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

73




 

 

Automatic Dividend Reinvestment Plans

Pursuant to each Fund’s Dividend Reinvestment Plan (the “Reinvestment Plan”), Common Shareholders are automatically enrolled to have all distributions of dividends and capital gains reinvested by Computershare Share-owner Services, LLC for MUA, MHD, MUH, MUS and MVT and Computershare Trust Company, N.A., for MEN and MUI (individually, the “Reinvestment Plan Agent” or together, the “Reinvestment Plan Agents”) in the respective Fund’s shares pursuant to the Reinvestment Plan. Shareholders who do not participate in the Reinvestment Plan will receive all distributions in cash paid by check and mailed directly to the shareholders of record (or if the shares are held in street name or other nominee name, then to the nominee) by the Reinvestment Plan Agent, which serves as agent for the shareholders in administering the Reinvestment Plan.

After the Funds declare a dividend or determines to make a capital gain distribution, the Reinvestment Plan Agent will acquire shares for the participants’ accounts, depending upon the following circumstances, either (i) through receipt of unissued but authorized shares from the Funds (“newly issued shares”) or (ii) by purchase of outstanding shares on the open market, on the Fund’s primary exchange (“open-market purchases”). If, on the dividend payment date, the net asset value per share (“NAV”) is equal to or less than the market price per share plus estimated brokerage commissions (such condition often referred to as a “market premium”), the Reinvestment Plan Agent will invest the dividend amount in newly issued shares acquired on behalf of the participants. The number of newly issued shares to be credited to each participant’s account will be determined by dividing the dollar amount of the dividend by the NAV on the date the shares are issued. However, if the NAV is less than 95% of the market price on the dividend payment date, the dollar amount of the dividend will be divided by 95% of the market price on the dividend payment date. If, on the dividend payment date, the NAV is greater than the market price per share plus estimated brokerage commissions (such condition often referred to as a “market discount”), the Reinvestment Plan Agent will invest the dividend amount in shares acquired on behalf of the participants in open-market purchases. If the Reinvestment Plan Agents are unable to invest the full dividend amount in open-market purchases, or if the market discount shifts to a market premium during the purchase period, the Reinvestment Plan Agent will invest any uninvested portion in newly issued shares. Investments in newly issued shares made in this manner would be made pursuant to the same process described above and the date of issue for such newly issued shares will substitute for the dividend payment date.

Participation in the Reinvestment Plan is completely voluntary and may be terminated or resumed at any time without penalty by notice if received and processed by the Reinvestment Plan Agent prior to the dividend record date. Additionally, the Reinvestment Plan Agent seeks to process notices received after the record date but prior to the payable date and such notices often will become effective by the payable date. Where late notices are not processed by the applicable payable date, such termination or resumption will be effective with respect to any subsequently declared dividend or other distribution.

The Reinvestment Plan Agent’s fees for the handling of the reinvestment of dividends and distributions will be paid by each Fund. However, each participant will pay a pro rata share of brokerage commissions incurred with respect to the Reinvestment Plan Agent’s open market purchases in connection with the reinvestment of dividends and distributions. The automatic reinvestment of dividends and distributions will not relieve participants of any federal income tax that may be payable on such dividends or distributions.

Each Fund reserves the right to amend or terminate the Reinvestment Plan. There is no direct service charge to participants in the Reinvestment Plan. However, each Fund reserves the right to amend the Reinvestment Plan to include a service charge payable by the participants. Participants in MEN and MUI that request a sale of shares are subject to a $2.50 sales fee and a $0.15 per share sold brokerage commission. Participants in MUA, MHD, MUH, MUS and MVT that request a sale of shares are subject to a $0.02 per share sold brokerage commission. All correspondence concerning the Reinvestment Plan for shareholders of MUA, MHD, MUH, MUS and MVT should be directed to Computershare Shareowner Services, LLC, P.0. Box 358035, Pittsburgh, PA 15252-8035, Telephone: (866) 216-0242. For shareholders of MEN and MUI, all correspondence concerning the Reinvestment Plan should be directed to Computershare Trust Company, N.A., P.O. Box 43078, Providence, RI 02940-3078, Telephone: (800) 699-1236, with overnight correspondence being directed to the Reinvestment Plan Agent at 250 Royall Street, Canton, MA 02021.

 

 

 

 

 

74

ANNUAL REPORT

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Officers and Directors


 

 

 

 

 

 

 

 

 

 

 

Name, Address
and Year of Birth

 

Position(s)
Held with
Funds

 

Length
of Time
Served as
a Director2

 

Principal Occupation(s) During Past Five Years

 

Number of BlackRock-
Advised Registered
Investment Companies
(“RICs”) Consisting of
Investment Portfolios
(“Portfolios”) Overseen

 

Public
Directorships

Independent Directors1

 

 

 

 

 

 

 

 

Richard E. Cavanagh
55 East 52nd Street
New York, NY 10055
1946

 

Chairman of the Board and Director

 

Since 2007

 

Trustee, Aircraft Finance Trust from 1999 to 2009; Director, The Guardian Life Insurance Company of America since 1998; Director, Arch Chemical (chemical and allied products) from 1999 to 2011; Trustee, Educational Testing Service from 1997 to 2009 and Chairman thereof from 2005 to 2009; Senior Advisor, The Fremont Group since 2008 and Director thereof since 1996; Adjunct Lecturer, Harvard University since 2007; President and Chief Executive Officer, The Conference Board, Inc. (global business research organization) from 1995 to 2007.

 

96 RICs consisting of 96 Portfolios

 

None

Karen P. Robards
55 East 52nd Street
New York, NY 10055
1950

 

Vice Chairperson of the Board, Chairperson of the Audit Committee and Director

 

Since 2007

 

Partner of Robards & Company, LLC (financial advisory firm) since 1987; Co-founder and Director of the Cooke Center for Learning and Development (a not-for-profit organization) since 1987; Director of Care Investment Trust, Inc. (health care real estate investment trust) from 2007 to 2010; Director of Enable Medical Corp. from 1996 to 2005; Investment Banker at Morgan Stanley from 1976 to 1987.

 

96 RICs consisting of 96 Portfolios

 

AtriCure, Inc. (medical devices)

Michael J. Castellano
55 East 52nd Street
New York, NY 10055
1946

 

Director and Member of the Audit Committee

 

Since 2011

 

Managing Director and Chief Financial Officer of Lazard Group LLC from 2001 to 2011; Chief Financial Officer of Lazard Ltd from 2004 to 2011; Director, Support Our Aging Religions (non-profit) since 2009; Director, National Advisory Board of Church Management at Villanova University since 2010.

 

96 RICs consisting of 96 Portfolios

 

None

Frank J. Fabozzi
55 East 52nd Street
New York, NY 10055
1948

 

Director and Member of the Audit Committee

 

Since 2007

 

Editor of and Consultant for The Journal of Portfolio Management since 1986; Professor of Finance, EDHEC Business School since 2011; Professor in the Practice of Finance and Becton Fellow, Yale University School of Management from 2006 to 2011; Adjunct Professor of Finance and Becton Fellow, Yale University from 1994 to 2006.

 

96 RICs consisting of 96 Portfolios

 

None

Kathleen F. Feldstein
55 East 52nd Street
New York, NY 10055
1941

 

Director

 

Since 2007

 

President of Economics Studies, Inc. (private economic consulting firm) since 1987; Chair, Board of Trustees, McLean Hospital from 2000 to 2008 and Trustee Emeritus thereof since 2008; Member of the Board of Partners Community Healthcare, Inc. from 2005 to 2009; Member of the Corporation of Partners HealthCare since 1995; Trustee, Museum of Fine Arts, Boston since 1992; Member of the Visiting Committee to the Harvard University Art Museum since 2003; Director, Catholic Charities of Boston since 2009.

 

96 RICs consisting of 96 Portfolios

 

The McClatchy Company (publishing); Bell South (telecommunications); Knight Ridder (publishing)

James T. Flynn
55 East 52nd Street
New York, NY 10055
1939

 

Director and Member of the Audit Committee

 

Since 2007

 

Chief Financial Officer of JPMorgan & Co., Inc. from 1990 to 1995.

 

96 RICs consisting of 96 Portfolios

 

None

Jerrold B. Harris
55 East 52nd Street
New York, NY 10055
1942

 

Director

 

Since 2007

 

Trustee, Ursinus College since 2000; Director, Troemner LLC (scientific equipment) since 2000; Director of Delta Waterfowl Foundation since 2001; President and Chief Executive Officer, VWR Scientific Products Corporation from 1990 to 1999.

 

96 RICs consisting of 96 Portfolios

 

BlackRock Kelso Capital Corp. (business development company)


 

 

 

 

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

75




 

 

Officers and Directors (continued)


 

 

 

 

 

 

 

 

 

 

 

 

Name, Address
and Year of Birth

 

Position(s)
Held with
Funds

 

Length
of Time
Served as
a Director2

 

Principal Occupation(s) During Past Five Years

 

Number of BlackRock-
Advised Registered
Investment Companies
(“RICs”) Consisting of
Investment Portfolios
(“Portfolios”) Overseen

 

Public
Directorships

Independent Directors1 (concluded)

R. Glenn Hubbard
55 East 52nd Street
New York, NY 10055
1958

 

Director

 

Since
2007

 

Dean, Columbia Business School since 2004; Columbia faculty member since 1988; Co-Director, Columbia Business School’s Entrepreneurship Program from 1997 to 2004; Chairman, U.S. Council of Economic Advisers under the President of the United States from 2001 to 2003; Chairman, Economic Policy Committee of the OECD from 2001 to 2003.

 

96 RICs consisting of 96 Portfolios

 

ADP (data and information services); KKR Financial Corporation (finance); Metropolitan Life Insurance Company(insurance)

W. Carl Kester
55 East 52nd Street
New York, NY 10055
1951

 

Director and
Member
of the Audit
Committee

 

Since
2007

 

George Fisher Baker Jr. Professor of Business Administration, Harvard Business School; Deputy Dean for Academic Affairs from 2006 to 2010; Chairman of the Finance Department, Harvard Business School from 2005 to 2006; Senior Associate Dean and Chairman of the MBA Program of Harvard Business School from 1999 to 2005; Member of the faculty of Harvard Business School since 1981.

 

96 RICs consisting of 96 Portfolios

 

None

 

 

1

Directors serve until their resignation, removal or death, or until December 31 of the year in which they turn 72. The maximum age limitation may be waived as to any Director by action of a majority of the Directors upon finding good cause thereof. In 2011, the Board of Directors unanimously approved extending the mandatory retirement age for James T. Flynn by one additional year, which the Board believes would be in the best interest of shareholders.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2

Date shown is the earliest date a person has served for the Funds covered by this annual report. Following the combination of Merrill Lynch Investment Managers, L.P. (“MLIM”) and BlackRock, Inc. (“BlackRock”) in September 2006, the various legacy MLIM and legacy BlackRock Fund boards were realigned and consolidated into three new Fund boards in 2007. As a result, although the chart shows certain Directors as joining the Funds’ board in 2007, each Director first became a member of the board of other legacy MLIM or legacy BlackRock Funds as follows: Richard E. Cavanagh, 1994; Frank J. Fabozzi, 1988; Kathleen F. Feldstein, 2005; James T. Flynn, 1996; Jerrold B. Harris, 1999; R. Glenn Hubbard, 2004; W. Carl Kester, 1995; and Karen P. Robards, 1998.

 

 

 

 

 

 

 

 

 

 

 

 

Interested Directors3

Paul L. Audet
55 East 52nd Street
New York, NY 10055
1953

 

Director

 

Since
2011

 

Senior Managing Director, BlackRock and Head of U.S. Mutual Funds since 2011; Chair of the U.S. Mutual Funds Committee reporting to the Global Executive Committee since 2011; Head of BlackRock’s Real Estate business from 2008 to 2011; Member of BlackRock’s Global Operating and Corporate Risk Management Committees and of the BlackRock Alternative Investors Executive Committee and Investment Committee for the Private Equity Fund of Funds business since 2008; Head of BlackRock’s Global Cash Management business from 2005 to 2010; Acting Chief Financial Officer of BlackRock from 2007 to 2008; Chief Financial Officer of BlackRock from 1998 to 2005.

 

158 RICs consisting of 281 Portfolios

 

None

Henry Gabbay
55 East 52nd Street
New York, NY 10055
1947

 

Director

 

Since
2007

 

Consultant, BlackRock from 2007 to 2008; Managing Director, BlackRock from 1989 to 2007; Chief Administrative Officer, BlackRock Advisors, LLC from 1998 to 2007; President of BlackRock Funds and BlackRock Bond Allocation Target Shares from 2005 to 2007; Treasurer of certain closedend funds in the BlackRock fund complex from 1989 to 2006.

 

158 RICs consisting of 281 Portfolios.

 

None

 

 

3

Mr. Audet is an “interested person,” as defined in the 1940 Act, of the Funds based on his position with BlackRock and its affiliates. Mr. Gabbay is an “interested person” of the Funds based on his former positions with BlackRock and its affiliates as well as his ownership of BlackRock and The PNC Financial Services Group, Inc. securities. Mr. Audet and Mr. Gabbay are also Directors of the BlackRock registered open-end funds. Directors serve until their resignation, removal or death, or until December 31 of the year in which they turn 72. The maximum age limitation may be waived as to any Director by action of a majority of the Directors upon finding good cause thereof.


 

 

 

 

 

 

 

John F. Powers, who was a Director of the Funds, resigned as of February 21, 2012.

 

 

 

 


 

 

 

 

 

 

76

ANNUAL REPORT

APRIL 30, 2012




 

 

Officers and Directors (continued)


 

 

 

 

 

 

 

 

Name, Address
and Year of Birth

 

Position(s)
Held with
Funds

 

Length
of Time
Served

 

Principal Occupation(s) During Past Five Years

Officers1

John M. Perlowski
55 East 52nd Street
New York, NY 10055
1964

 

President and
Chief Executive
Officer

 

Since
2011

 

Managing Director of BlackRock since 2009; Global Head of BlackRock Fund Administration since 2009; Managing Director and Chief Operating Officer of the Global Product Group at Goldman Sachs Asset Management, L.P. from 2003 to 2009; Treasurer of Goldman Sachs Mutual Funds from 2003 to 2009 and Senior Vice President thereof from 2007 to 2009; Director of Goldman Sachs Offshore Funds from 2002 to 2009; Director of Family Resource Network (charitable foundation) since 2009.

Anne Ackerley
55 East 52nd Street
New York, NY 10055
1962

 

Vice
President

 

Since
20072

 

Managing Director of BlackRock since 2000; Chief Marketing Officer of BlackRock since 2012; President and Chief Executive Officer of the BlackRock-advised funds from 2009 to 2011; Vice President of the BlackRock-advised funds from 2007 to 2009; Chief Operating Officer of BlackRock’s Global Client Group from 2009 to 2012; Chief Operating Officer of BlackRock’s U.S. Retail Group from 2006 to 2009; Head of BlackRock’s Mutual Fund Group from 2000 to 2006.

Brendan Kyne
55 East 52nd Street
New York, NY 10055
1977

 

Vice
President

 

Since
2009

 

Managing Director of BlackRock since 2010; Director of BlackRock from 2008 to 2009; Head of Product Development and Management for BlackRock’s U.S. Retail Group since 2009; and Co-head thereof from 2007 to 2009; Vice President of BlackRock from 2005 to 2008.

Neal Andrews
55 East 52nd Street
New York, NY 10055
1966

 

Chief
Financial
Officer

 

Since
2007

 

Managing Director of BlackRock since 2006; Senior Vice President and Line of Business Head of Fund Accounting and Administration at PNC Global Investment Servicing (U.S.) Inc. from 1992 to 2006.

Jay Fife
55 East 52nd Street
New York, NY 10055
1970

 

Treasurer

 

Since
2007

 

Managing Director of BlackRock since 2007; Director of BlackRock in 2006; Assistant Treasurer of the MLIM and Fund Asset Management, L.P. advised funds from 2005 to 2006; Director of MLIM Fund Services Group from 2001 to 2006.

Brian Kindelan
55 East 52nd Street
New York, NY 10055
1959

 

Chief Compliance
Officer and
Anti-Money
Laundering Officer

 

Since
2007

 

Chief Compliance Officer of the BlackRock-advised funds since 2007; Managing Director and Senior Counsel of BlackRock since 2005.

Ira P. Shapiro
55 East 52nd Street
New York, NY 10055
1963

 

Secretary

 

Since
2010

 

Managing Director of BlackRock since 2009; Managing Director and Associate General Counsel of Barclays Global Investors from 2008 to 2009 and Principal thereof from 2004 to 2008.

 

 

1

Officers of the Funds serve at the pleasure of the Board.

 

 

 

 

 

 

2

Ms. Ackerley was President and Chief Executive Officer from 2009 to 2011.


 

 

 

 

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

77




 

 

Officers and Directors (concluded)

Investment Advisor
BlackRock Advisors, LLC
Wilmington, DE 19809

Sub-Advisor
BlackRock Investment
Management, LLC
Princeton, NJ 08540

Custodians
The Bank of New York Mellon1
New York, NY 10286

State Street Bank and
Trust Company2
Boston, MA 02110

Transfer Agent
Computershare Trust Company, N.A.
Canton, MA 02021

VRDP Tender and Paying Agent and VMTP Redemption and Paying Agent
The Bank of New York Mellon
New York, NY 10289

VRDP Remarketing Agents
Citigroup Global Markets Inc.3
New York, NY 10179
J.P. Morgan Securities LLC4
New York, NY 10179

VRDP Liquidity Providers
Citibank, N.A.3
New York, NY 10179

J.P. Morgan Chase Bank, N.A.4
New York, NY 10179

Accounting Agent
State Street Bank and
Trust Company
Boston, MA 02110

Independent Registered Public Accounting Firm
Deloitte & Touche LLP
Boston, MA 02116

Legal Counsel
Skadden, Arps, Slate,
Meagher & Flom LLP
New York, NY 10036

Address of the Funds
100 Bellevue Parkway
Wilmington, DE 19809

 

 

1

For MUA, MHD, MUH, MUS and MVT.

 

 

2

For MEN and MUI.

 

 

3

For MEN.

 

 

4

For MUI.


 

 

 

 

 

 

78

ANNUAL REPORT

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Additional Information

 

 

Fund Certification

The Funds are listed for trading on the NYSE and have filed with the NYSE their annual chief executive officer certification regarding compliance with the NYSE’s listing standards. The Funds filed with the SEC the certification of their chief executive officer and chief financial officer required by section 302 of the Sarbanes-Oxley Act.

 

Dividend Policy

Each Fund’s dividend policy is to distribute all or a portion of its net investment income to its shareholders on a monthly basis. In order to provide shareholders with a more stable level of dividend distributions, the Funds may at times pay out less than the entire amount of net investment income earned in any particular month and may at times in any particular month pay out such accumulated but undistributed income in addition to net investment income earned in that month. As a result, the dividends paid by the Funds for any particular month may be more or less than the amount of net investment income earned by the Funds during such month. The Funds’ current accumulated but undistributed net investment income, if any, is disclosed in the Statements of Assets and Liabilities, which comprises part of the financial information included in this report.

 

 

 

 

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

79




 

 

Additional Information (continued)

 

 

General Information

On June 10, 2010, the Manager announced that the directors of MUI had received a demand letter sent on behalf of certain of MUI Common Shareholders. The demand letter alleged that the Manager and MUI’s officers and Board of Directors (the “Board”) breached their fiduciary duties owed to MUI and its Common Shareholders by redeeming at par certain of MUI’s AMPS, and demanded that the Board take action to remedy those alleged breaches. In response to the demand letter, the Board established a Demand Review Committee (the “Committee”) of the Independent Directors to investigate the claims made in the demand letter with the assistance of independent counsel. Based upon its investigation, the Committee recommended that the Board reject the demand specified in the letter. After reviewing the findings of the Committee, the Board unanimously adopted the Committee’s recommendation and unanimously voted to reject the demand.

The Funds do not make available copies of their Statements of Additional Information because the Funds’ shares are not continuously offered, which means that the Statement of Additional Information of each Fund has not been updated after completion of the respective Fund’s offerings and the information contained in each Fund’s Statement of Additional Information may have become outdated.

During the period, there were no material changes in the Funds’ investment objectives or policies or to the Funds’ charters or by-laws that would delay or prevent a change in control of the Funds, that were not approved by the shareholders or in the principal risk factors associated with investment in the Funds. There have been no changes in the persons who are primarily responsible for the day-to-day management of the Funds’ portfolio.

Quarterly performance, semi-annual and annual reports and other information regarding the Funds may be found on BlackRock’s website, which can be accessed at http://www.blackrock.com. This reference to BlackRock’s web-site is intended to allow investors public access to information regarding the Funds and does not, and is not intended to, incorporate BlackRock’s website in this report.

Electronic Delivery
Electronic copies of most financial reports are available on the Funds’ web-sites or shareholders can sign up for e-mail notifications of quarterly statements, annual and semi-annual reports by enrolling in the Funds’ electronic delivery program.

Shareholders Who Hold Accounts with Investment Advisors, Banks or Brokerages:
Please contact your financial advisor to enroll. Please note that not all investment advisors, banks or brokerages may offer this service.

Householding
The Funds will mail only one copy of shareholder documents, including annual and semi-annual reports and proxy statements, to shareholders with multiple accounts at the same address. This practice is commonly called “householding” and is intended to reduce expenses and eliminate duplicate mailings of shareholder documents. Mailings of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please call (800) 441-7762.

 

 

 

 

 

 

80

ANNUAL REPORT

APRIL 30, 2012




 

 

Additional Information (continued)

 

 

General Information (concluded)

Availability of Quarterly Schedule of Investments
The Funds file their complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The Funds’ Forms N-Q are available on the SEC’s website at http://www.sec.gov and may also be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information on how to access documents on the SEC’s website without charge may be obtained by calling (800) SEC-0330. The Funds’ Forms N-Q may also be obtained upon request and without charge by calling (800) 441-7762.

Availability of Proxy Voting Policies and Procedures
A description of the policies and procedures that the Funds use to determine how to vote proxies relating to portfolio securities is available (1) without charge, upon request, by calling (800) 441-7762; (2) at http://www.blackrock.com; and (3) on the SEC’s website at http://www.sec.gov.

Availability of Proxy Voting Record
Information about how the Funds voted proxies relating to securities held in the Funds’ portfolios during the most recent 12-month period ended June 30 is available upon request and without charge (1) at http://www.blackrock.com or by calling (800) 441-7762 and (2) on the SEC’s website at http://www.sec.gov.

Availability of Fund Updates
BlackRock will update performance and certain other data for the Funds on a monthly basis on its website in the “Closed-end Funds” section of http://www.blackrock.com. Investors and others are advised to periodically check the website for updated performance information and the release of other material information about the Funds. This reference to BlackRock’s website is intended to allow investors public access to information regarding the Funds and does not, and is not intended to incorporate BlackRock’s website in this report.

 

 

 

 

 

 

 

 

 

ANNUAL REPORT

APRIL 30, 2012

81




 

 

Additional Information (concluded)


 

BlackRock Privacy Principles

BlackRock is committed to maintaining the privacy of its current and former fund investors and individual clients (collectively, “Clients”) and to safeguarding their non-public personal information. The following information is provided to help you understand what personal information BlackRock collects, how we protect that information and why in certain cases we share such information with select parties.

If you are located in a jurisdiction where specific laws, rules or regulations require BlackRock to provide you with additional or different privacy-related rights beyond what is set forth below, then BlackRock will comply with those specific laws, rules or regulations.

BlackRock obtains or verifies personal non-public information from and about you from different sources, including the following: (i) information we receive from you or, if applicable, your financial intermediary, on applications, forms or other documents; (ii) information about your transactions with us, our affiliates, or others; (iii) information we receive from a consumer reporting agency; and (iv) from visits to our websites.

BlackRock does not sell or disclose to non-affiliated third parties any non-public personal information about its Clients, except as permitted by law or as is necessary to respond to regulatory requests or to service Client accounts. These non-affiliated third parties are required to protect the confidentiality and security of this information and to use it only for its intended purpose.

We may share information with our affiliates to service your account or to provide you with information about other BlackRock products or services that may be of interest to you. In addition, BlackRock restricts access to non-public personal information about its Clients to those BlackRock employees with a legitimate business need for the information. BlackRock maintains physical, electronic and procedural safeguards that are designed to protect the non-public personal information of its Clients, including procedures relating to the proper storage and disposal of such information.

 

 

 

 

 

 

82

ANNUAL REPORT

APRIL 30, 2012



This report is transmitted to shareholders only. It is not a prospectus. Past performance results shown in this report should not be considered a representation of future performance. Certain of the Funds have leveraged their Common Shares, which creates risks for Common Shareholders, including the likelihood of greater volatility of net asset value and market price of the Common Shares, and the risk that fluctuations in the short-term dividend rates of the Preferred Shares, including AMPS, which are currently set at the maximum reset rate as a result of failed auctions, may reduce the Common Shares’ yield. Statements and other information herein are as dated and are subject to change.

(GO PAPERLESS LOGO)

 

 

#CEMUNI7-4/12-AR

(BLACKROCK LOGO)


Item 2 –

Code of Ethics – The registrant (or the “Fund”) has adopted a code of ethics, as of the end of the period covered by this report, applicable to the registrant’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. During the period covered by this report, there have been no amendments to or waivers granted under the code of ethics. A copy of the code of ethics is available without charge at www.blackrock.com.

 

 

Item 3 –

Audit Committee Financial Expert – The registrant’s board of directors (the “board of directors”), has determined that (i) the registrant has the following audit committee financial experts serving on its audit committee and (ii) each audit committee financial expert is independent:

 

 

 

Frank J. Fabozzi

 

James T. Flynn

 

W. Carl Kester

 

Karen P. Robards

 

 

 

The registrant’s board of directors has determined that W. Carl Kester and Karen P. Robards qualify as financial experts pursuant to Item 3(c)(4) of Form N-CSR.

 

 

 

Prof. Kester has a thorough understanding of generally accepted accounting principles, financial statements and internal control over financial reporting as well as audit committee functions. Prof. Kester has been involved in providing valuation and other financial consulting services to corporate clients since 1978. Prof. Kester’s financial consulting services present a breadth and level of complexity of accounting issues that are generally comparable to the breadth and complexity of issues that can reasonably be expected to be raised by the registrant’s financial statements.

 

 

 

Ms. Robards has a thorough understanding of generally accepted accounting principles, financial statements and internal control over financial reporting as well as audit committee functions. Ms. Robards has been President of Robards & Company, a financial advisory firm, since 1987. Ms. Robards was formerly an investment banker for more than 10 years where she was responsible for evaluating and assessing the performance of companies based on their financial results. Ms. Robards has over 30 years of experience analyzing financial statements. She also is a member of the audit committee of one publicly held company and a non-profit organization.

 

 

 

Under applicable securities laws, a person determined to be an audit committee financial expert will not be deemed an “expert” for any purpose, including without limitation for the purposes of Section 11 of the Securities Act of 1933, as a result of being designated or identified as an audit committee financial expert. The designation or identification as an audit committee financial expert does not impose on such person any duties, obligations, or liabilities greater than the duties, obligations, and liabilities imposed on such person as a member of the audit committee and board of directors in the absence of such designation or identification. The designation or identification of a person as an audit committee financial expert does not affect the duties, obligations, or liability of any other member of the audit committee or board of directors.

 


Item 4 –

Principal Accountant Fees and Services

 

 

 

The following table presents fees billed by Deloitte & Touche LLP (“D&T”) in each of the last two fiscal years for the services rendered to the Fund:

 

 

(a) Audit Fees

(b) Audit-Related Fees1

(c) Tax Fees2

(d) All Other Fees3

Entity Name

Current
Fiscal Year
End

Previous
Fiscal Year End

Current
Fiscal Year
End

Previous
Fiscal Year
End

Current
Fiscal Year
End

Previous
Fiscal Year
End

Current
Fiscal Year
End

Previous
Fiscal Year
End

BlackRock MuniEnhanced Fund, Inc.

$34,900

$34,300

$0

$4,700

$14,600

$14,100

$0

$0

 

 

The following table presents fees billed by D&T that were required to be approved by the registrant’s audit committee (the “Committee”) for services that relate directly to the operations or financial reporting of the Fund and that are rendered on behalf of BlackRock Advisors, LLC (“Investment Adviser” or “BlackRock”) and entities controlling, controlled by, or under common control with BlackRock (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser) that provide ongoing services to the Fund (“Fund Service Providers”):

 

 

Current Fiscal Year End

Previous Fiscal Year End

(b) Audit-Related Fees1

$0

$0

(c) Tax Fees2

$0

$0

(d) All Other Fees3

$2,970,000

$3,030,000

 

1 The nature of the services includes assurance and related services reasonably related to the performance of the audit of financial statements not included in Audit Fees.

2 The nature of the services includes tax compliance, tax advice and tax planning.

3 Aggregate fees borne by BlackRock in connection with the review of compliance procedures and attestation thereto performed by D&T with respect to all of the registered closed-end funds and some of the registered open-end funds advised by BlackRock.

 

 

 

(e)(1) Audit Committee Pre-Approval Policies and Procedures:

 

 

 

The Committee has adopted policies and procedures with regard to the pre-approval of services. Audit, audit-related and tax compliance services provided to the registrant on an annual basis require specific pre-approval by the Committee. The Committee also must approve other non-audit services provided to the registrant and those non-audit services provided to the Investment Adviser and Fund Service Providers that relate directly to the operations and the financial reporting of the registrant. Certain of these non-audit services that the Committee believes are a) consistent with the SEC’s auditor independence rules and b) routine and recurring services that will not impair the independence of the independent accountants may be approved by the Committee without consideration on a specific case-by-case basis (“general pre-approval”). The term of any general pre-approval is 12 months from the date of the pre-approval, unless the Committee provides for a different period. Tax or other non-audit services provided to the registrant which have a direct impact on the operations or financial reporting of the registrant will only be deemed pre-approved provided that any individual project does not exceed $10,000 attributable to the registrant or $50,000 per project. For this purpose, multiple projects will be aggregated to determine if they exceed the previously mentioned cost levels.

 


 

Any proposed services exceeding the pre-approved cost levels will require specific pre-approval by the Committee, as will any other services not subject to general pre-approval (e.g., unanticipated but permissible services). The Committee is informed of each service approved subject to general pre-approval at the next regularly scheduled in-person board meeting. At this meeting, an analysis of such services is presented to the Committee for ratification. The Committee may delegate to the Committee Chairman the authority to approve the provision of and fees for any specific engagement of permitted non-audit services, including services exceeding pre-approved cost levels.

 

 

 

(e)(2) None of the services described in each of Items 4(b) through (d) were approved by the Committee pursuant to the de minimis exception in paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.

 

 

 

(f) Not Applicable

 

 

 

(g) The aggregate non-audit fees paid to the accountant for services rendered by the accountant to the registrant, the Investment Adviser and the Fund Service Providers were:

 

Entity Name

Current Fiscal Year End

Previous Fiscal Year End

BlackRock MuniEnhanced Fund, Inc.

$14,600

$18,800

 

 

Additionally, SSAE 16 Review (Formerly, SAS No. 70) fees for the current and previous fiscal years of $2,970,000 and $3,030,000, respectively, were billed by D&T to the Investment Adviser.

 

 

 

(h) The Committee has considered and determined that the provision of non-audit services that were rendered to the Investment Adviser, and the Fund Service Providers that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with maintaining the principal accountant’s independence.

 

 

Item 5 –

Audit Committee of Listed Registrants

 

 

(a) 

The following individuals are members of the registrant’s separately-designated standing audit committee established in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)(58)(A)):

 

 

Michael Castellano

 

 

Frank J. Fabozzi

 

 

James T. Flynn

 

 

W. Carl Kester

 

 

Karen P. Robards

 

 

 

 

(b) 

Not Applicable

 

Item 6 –

Investments

 

(a) The registrant’s Schedule of Investments is included as part of the Report to Stockholders filed under Item 1 of this Form.

 

(b) Not Applicable due to no such divestments during the semi-annual period covered since the previous Form N-CSR filing.

 


Item 7 –

Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies – The board of directors has delegated the voting of proxies for the Fund’s portfolio securities to the Investment Adviser pursuant to the Investment Adviser’s proxy voting guidelines. Under these guidelines, the Investment Adviser will vote proxies related to Fund securities in the best interests of the Fund and its stockholders. From time to time, a vote may present a conflict between the interests of the Fund’s stockholders, on the one hand, and those of the Investment Adviser, or any affiliated person of the Fund or the Investment Adviser, on the other. In such event, provided that the Investment Adviser’s Equity Investment Policy Oversight Committee, or a sub-committee thereof (the “Oversight Committee”) is aware of the real or potential conflict or material non-routine matter and if the Oversight Committee does not reasonably believe it is able to follow its general voting guidelines (or if the particular proxy matter is not addressed in the guidelines) and vote impartially, the Oversight Committee may retain an independent fiduciary to advise the Oversight Committee on how to vote or to cast votes on behalf of the Investment Adviser’s clients. If the Investment Adviser determines not to retain an independent fiduciary, or does not desire to follow the advice of such independent fiduciary, the Oversight Committee shall determine how to vote the proxy after consulting with the Investment Adviser’s Portfolio Management Group and/or the Investment Adviser’s Legal and Compliance Department and concluding that the vote cast is in its client’s best interest notwithstanding the conflict. A copy of the Fund’s Proxy Voting Policy and Procedures are attached as Exhibit 99.PROXYPOL. Information on how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available without charge, (i) at www.blackrock.com and (ii) on the SEC’s website at http://www.sec.gov.

 

 

Item 8 –

Portfolio Managers of Closed-End Management Investment Companies – as of April 30, 2012.

 

 

(a)(1)

The registrant is managed by a team of investment professionals comprised of Michael Kalinoski, Director at BlackRock, Theodore R. Jaeckel, Jr., CFA, Managing Director at BlackRock and Walter O’Connor, Managing Director at BlackRock. Each is a member of BlackRock’s municipal tax-exempt management group. Each is jointly responsible for the day-to-day management of the registrant’s portfolio, which includes setting the registrant’s overall investment strategy, overseeing the management of the registrant and/or selection of its investments. Messrs. Kalinoski, Jaeckel and O’Connor have been members of the registrant’s portfolio management team since 2000, 2006 and 2006, respectively.

 

Portfolio Manager

Biography

Michael Kalinoski

Director of BlackRock since 2006; Director of Merrill Lynch Investment Managers, L.P. (“MLIM”) from 1999 to 2006.

Theodore R. Jaeckel, Jr.

Managing Director at BlackRock since 2006; Managing Director of MLIM from 2005 to 2006; Director of MLIM from 1997 to 2005.

Walter O’Connor

Managing Director of BlackRock since 2006; Managing Director of MLIM from 2003 to 2006; Director of MLIM from 1998 to 2003.

 


 

(a)(2)

As of April 30, 2012:

 

 

(ii) Number of Other Accounts Managed

and Assets by Account Type

(iii) Number of Other Accounts and

Assets for Which Advisory Fee is

Performance-Based

(i) Name of

Portfolio Manager

Other

Registered

Investment

Companies

Other Pooled

Investment

Vehicles

Other

Accounts

Other

Registered

Investment

Companies

Other Pooled

Investment

Vehicles

Other

Accounts

Michael Kalinoski

10

0

0

0

0

0

 

$4.91 Billion

$0

$0

$0

$0

$0

Theodore R. Jaeckel, Jr.

65

0

0

0

0

0

 

$22.88 Billion

$0

$0

$0

$0

$0

Walter O’Connor

65

0

0

0

0

0

 

$22.88 Billion

$0

$0

$0

$0

$0

 

 

(iv)

Potential Material Conflicts of Interest

 

 

BlackRock has built a professional working environment, firm-wide compliance culture and compliance procedures and systems designed to protect against potential incentives that may favor one account over another. BlackRock has adopted policies and procedures that address the allocation of investment opportunities, execution of portfolio transactions, personal trading by employees and other potential conflicts of interest that are designed to ensure that all client accounts are treated equitably over time. Nevertheless, BlackRock furnishes investment management and advisory services to numerous clients in addition to the Fund, and BlackRock may, consistent with applicable law, make investment recommendations to other clients or accounts (including accounts which are hedge funds or have performance or higher fees paid to BlackRock, or in which portfolio managers have a personal interest in the receipt of such fees), which may be the same as or different from those made to the Fund.  In addition, BlackRock, Inc., its affiliates and significant shareholders and any officer, director, shareholder or employee may or may not have an interest in the securities whose purchase and sale BlackRock recommends to the Fund.  BlackRock, Inc., or any of its affiliates or significant shareholders, or any officer, director, shareholder, employee or any member of their families may take different actions than those recommended to the Fund by BlackRock with respect to the same securities.  Moreover, BlackRock may refrain from rendering any advice or services concerning securities of companies of which any of BlackRock, Inc.’s (or its affiliates’ or significant shareholders’) officers, directors or employees are directors or officers, or companies as to which BlackRock, Inc. or any of its affiliates or significant shareholders or the officers, directors and employees of any of them has any substantial economic interest or possesses material non-public information.  Certain portfolio managers also may manage accounts whose investment strategies may at times be opposed to the strategy utilized for a fund.  It should also be noted that a portfolio manager may be managing certain hedge fund and/or long only accounts, or may be part of a team managing certain hedge fund and/or long only accounts, subject to incentive fees. Such portfolio managers may therefore be entitled to receive a portion of any incentive fees earned on such accounts. Currently, the portfolio managers of this fund are not entitled to receive a portion of incentive fees of other accounts.

 

 

 

As a fiduciary, BlackRock owes a duty of loyalty to its clients and must treat each client fairly.  When BlackRock purchases or sells securities for more than one account, the trades must be allocated in a manner consistent with its fiduciary duties.  BlackRock attempts to allocate investments in a fair and equitable manner among client accounts, with no account receiving preferential treatment.  To this end, BlackRock, Inc. has adopted policies that are intended to ensure reasonable efficiency in client transactions and provide BlackRock with sufficient flexibility to allocate investments in a manner that is consistent with the particular investment discipline and client base, as appropriate.


 

(a)(3)

As of April 30, 2012:

 

 

Portfolio Manager Compensation Overview

 

 

 

BlackRock’s financial arrangements with its portfolio managers, its competitive compensation and its career path emphasis at all levels reflect the value senior management places on key resources. Compensation may include a variety of components and may vary from year to year based on a number of factors. The principal components of compensation include a base salary, a performance-based discretionary bonus, participation in various benefits programs and one or more of the incentive compensation programs established by BlackRock.

 

 

 

Base compensation.

 

 

 

Generally, portfolio managers receive base compensation based on their position with BlackRock, Inc.

 

 

 

Discretionary Incentive Compensation.

 

 

 

Discretionary incentive compensation is a function of several components: the performance of BlackRock, Inc., the performance of the portfolio manager’s group within BlackRock, the investment performance, including risk-adjusted returns, of the firm’s assets under management or supervision by that portfolio manager relative to predetermined benchmarks, and the individual’s performance and contribution to the overall performance of these portfolios and BlackRock.  In most cases, these benchmarks are the same as the benchmark or benchmarks against which the performance of the Fund or other accounts managed by the portfolio managers are measured.  Among other things, BlackRock’s Chief Investment Officers make a subjective determination with respect to each portfolio manager’s compensation based on the performance of the funds and other accounts managed by each portfolio manager relative to the various benchmarks.  Performance of fixed income funds is measured on a pre-tax and/or after-tax basis over various time periods including 1-, 3- and 5- year periods, as applicable. With respect to these portfolio managers, such benchmarks for the Fund and other accounts are:

 

Portfolio Manager

Benchmark

Theodore R. Jaeckel, Jr.

A combination of market-based indices (e.g., Barclays Capital Muni Bond Index,

Standard & Poor’s Municipal Bond Index, Barclays Capital Taxable Municipal Build America Bonds Index), certain customized indices and certain fund industry peer groups.

Walter O’Connor

A combination of market-based indices (e.g., Barclays Capital Muni Bond Index,

Standard & Poor’s Municipal Bond Index), certain customized indices and certain

fund industry peer groups.

Michael Kalinoski

A combination of market-based indices (e.g., Standard & Poor’s Municipal Bond

Index, Barclays Capital Taxable Municipal Build America Bonds Index), certain

customized indices and certain fund industry peer groups.

 


 

Distribution of Discretionary Incentive Compensation

 

 

 

Discretionary incentive compensation is distributed to portfolio managers in a combination of cash and BlackRock, Inc. restricted stock units which vest ratably over a number of years. For some portfolio managers, discretionary incentive compensation is also distributed in deferred cash awards that notionally track the returns of select BlackRock investment products they manage and that vest ratably over a number of years. The BlackRock, Inc. restricted stock units, upon vesting, will be settled in BlackRock, Inc. common stock. Typically, the cash portion of the discretionary incentive compensation, when combined with base salary, represents more than 60% of total compensation for the portfolio managers. Paying a portion of discretionary incentive compensation in BlackRock stock puts compensation earned by a portfolio manager for a given year “at risk” based on BlackRock’s ability to sustain and improve its performance over future periods. Providing a portion of discretionary incentive compensation in deferred cash awards that notionally track the BlackRock investment products they manage provides direct alignment with investment product results.

 

 

 

Long-Term Incentive Plan Awards — From time to time long-term incentive equity awards are granted to certain key employees to aid in retention, align their interests with long-term shareholder interests and motivate performance.  Equity awards are generally granted in the form of BlackRock, Inc. restricted stock units that, once vested, settle in BlackRock, Inc. common stock. Messrs. Jaeckel and O’Connor have each received long-term incentive awards.

 

 

 

Deferred Compensation Program — A portion of the compensation paid to eligible BlackRock employees may be voluntarily deferred at their election for defined periods of time into an account that tracks the performance of certain of the firm’s investment products. All of the eligible portfolio managers have participated in the deferred compensation program.

 

 

 

Other compensation benefits.

 

 

 

In addition to base compensation and discretionary incentive compensation, portfolio managers may be eligible to receive or participate in one or more of the following incentive savings plans. BlackRock, Inc. has created a variety of incentive savings plans in which BlackRock employees are eligible to participate, including a 401(k) plan, the BlackRock Retirement Savings Plan (RSP), and the BlackRock Employee Stock Purchase Plan (ESPP). The employer contribution components of the RSP include a company match equal to 50% of the first 8% of eligible pay contributed to the plan capped at $5,000 per year, and a company retirement contribution equal to 3-5% of eligible compensation up to the IRS limit ($250,000 for 2012).  The RSP offers a range of investment options, including registered investment companies and collective investment funds managed by the firm. BlackRock contributions follow the investment direction set by participants for their own contributions or, absent participant investment direction, are invested into an index target date fund that corresponds to, or is closest to, the year in which the participant attains age 65.  The ESPP allows for investment in BlackRock common stock at a 5% discount on the fair market value of the stock on the purchase date.  Annual participation in the ESPP is limited to the purchase of 1,000 shares of common stock or a dollar value of $25,000 based on its fair market value on the purchase date.  Messrs. Jaeckel, O’Connor and Kalinoski are each eligible to participate in these plans.

 


 

(a)(4)

Beneficial Ownership of Securities – As of April 30, 2012.

 

Portfolio Manager

Dollar Range of Equity Securities
of the Fund Beneficially Owned

Michael Kalinoski

None

Theodore R. Jaeckel, Jr.

None

Walter O’Connor

None

 

 

(b) Not Applicable

 

 

Item 9 –

Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers – Not Applicable due to no such purchases during the period covered by this report.

 

 

Item 10 –

Submission of Matters to a Vote of Security Holders – There have been no material changes to these procedures.

 

 

Item 11 –

Controls and Procedures

 

 

 

(a) – The registrant’s principal executive and principal financial officers, or persons performing similar functions, have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”)) are effective as of a date within 90 days of the filing of this report based on the evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act and Rule 13a-15(b) under the Securities Exchange Act of 1934, as amended.

 

 

 

(b) – There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) that occurred during the second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting.

 

 

Item 12 –

Exhibits attached hereto

 

 

 

(a)(1) – Code of Ethics – See Item 2

 

 

 

(a)(2) – Certifications – Attached hereto

 

 

 

(a)(3) – Not Applicable

 

 

 

(b) – Certifications – Attached hereto

 


 

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.

 

 

 

BlackRock MuniEnhanced Fund, Inc.

 

 

 

By: /s/ John M. Perlowski

 

 

 

John M. Perlowski

 

 

Chief Executive Officer (principal executive officer) of

 

 

BlackRock MuniEnhanced Fund, Inc.

 

 

 

Date: July 2, 2012

 

 

 

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 M. Perlowski

 

 

 

John M. Perlowski

 

 

Chief Executive Officer (principal executive officer) of

 

 

BlackRock MuniEnhanced Fund, Inc.

 

 

 

Date: July 2, 2012

 

 

 

By: /s/ Neal J. Andrews

 

 

 

Neal J. Andrews

 

 

Chief Financial Officer (principal financial officer) of

 

 

BlackRock MuniEnhanced Fund, Inc.

 

 

 

 

Date: July 2, 2012