<PAGE>
April 30, 1999 Annual Report
NUVEEN
Mutual Funds
Nuveen Municipal Bond Funds
Dependable, tax-free income to help
you keep more of what you earn.
Municipal Bond Fund
Insured Municipal Bond Fund
[PHOTO APPEARS HERE]
Featuring Portfolio Management By Nuveen Investment Advisory Services
A Premier Adviser/SM/ for Income Investing
<PAGE>
Contents
1 Dear Shareholder
4 Report from the Portfolio Managers
6 Nuveen Municipal Bond Fund Highlights
7 Nuveen Insured Municipal Bond Fund Highlights
8 Portfolio of Investments
25 Statement of Net Assets
26 Statement of Operations
27 Statement of Changes in Net Assets
28 Notes to Financial Statements
33 Financial Highlights
35 Report of Independent Public Accountants
36 Building a Better Portfolio
37 Fund Information
<PAGE>
DEAR Shareholder
[Photo of Timothy R. Schwertfeger appears here]
Timothy R. Schwertfeger
Chairman of the Board
I'm pleased to inform you that over the past 12 months, Nuveen Municipal Bond
Fund and Nuveen Insured Municipal Bond Fund continued to meet their primary
objectives of providing you with dependable tax-free income and attractive
after-tax total returns. The combination of these two components demonstrates
once again that Nuveen's municipal bond funds can serve as excellent investment
options for income-oriented investors.
"Improvements in productivity, spurred by technological advances, have been
responsible for offsetting wage and other inflationary pressures."
The Year in Review.
The past 12 months saw the U.S. economy continue its pattern of non-inflationary
growth, accompanied by low interest rates and unemployment levels that remain
among the lowest in three decades. Much of the current economic growth is
propelled by consumer demand, which has helped the U.S. resist the downward pull
of weaker overseas markets.
All indications point to a confident U.S. consumer who is comfortable with
the current state of the economy, especially the performance of the housing,
stock and job markets. This belief is reflected in the most recent Consumer
Confidence Index report, issued by the Conference Board, Inc., which showed a
record-setting seventh consecutive month of gains in May.
On the global front, the turmoil of the past two years appears to be fading
somewhat, as international financial markets have begun to send recovery
signals.
Inflation in the U.S. continued to operate at benign levels, with an
increase of 2.2% for the 12 months ended April 30, 1999. Despite a spike in
consumer prices in April, propelled by rising energy costs (which are showing
signs of retreating), the general backdrop of inflation indicators continued to
be mild, with the employment cost index, average hourly earnings, and import and
producer price trends all remaining favorable.
As Federal Reserve Chairman Alan Greenspan recently stated, one of the key
factors in achieving today's peaceful coexistence of economic growth and low
inflation has been increased productivity. Improvements in productivity, spurred
by technological advances, have been responsible for offsetting wage and other
inflationary pressures that we would normally expect to see as part of a growing
economy.
1
<PAGE>
"Municipal bonds represented a reasonably insulated haven in an otherwise
turbulent market, with lower volatility relative to Treasury bonds and other
fixed-income investments."
On the interest rate front, last fall saw the Federal Reserve ease short-
term rates for the first time in almost three years. Between the end of
September and mid-November 1998, three successive cuts brought the federal funds
rate to 4.75%, averting a potential domestic credit crunch and restoring some
stability to global markets.
Following the success of these preemptive moves, the Federal Reserve
indicated that fighting inflation continued to be a top priority by remaining in
a proactive mode and responding to April's increased consumer prices with a
shift to a tightening bias. By doing this, the Fed signaled its continued
support of the market without changing interest rates or fundamentally altering
the economy.
In the months ahead, we will continue to watch for indications from the Fed
and other factors that affect the economy's future, including wage and
employment statistics, reports on productivity growth, capital equipment
spending, and the progress of international economic recovery. We believe these
key components will influence the outlook for fixed-income markets well into the
new millennium.
Municipal Bonds: An Attractive Investment Option.
As interest rates declined over the past year, our municipal bond funds
continued to provide bright spots among the various investment options, offering
attractive, stable income in a market that places a high premium on yield.
In 1998, municipal bonds represented a reasonably insulated haven in an
otherwise turbulent market, with lower volatility relative to Treasury bonds and
other fixed-income investments. In fact, for the first four months of 1999,
municipals continued to outperform Treasuries.
The high ratio of tax-exempt municipal yields to Treasury yields sheltered
municipal bonds from the price decline that occurred in the Treasury market
during the first four months of the year. While the interest rate on 30-year
Treasury bonds rose from 5.10% at the end of December to 5.66% as of April 30,
1999, the yield on the Bond Buyer Revenue Bond Index, an unmanaged index of
long-term municipal revenue bonds, gained just three basis points--from 5.26% to
5.29%. Given the inverse relationship between interest rates and bond prices, we
saw bond prices fall as rates rose over this period.
Though municipal bond prices did decrease, the decline was not as dramatic
as the drop in Treasuries. The differential in performance reflects the fact
that Treasuries had become relatively expensive as the result of safe-haven
buying during the international economic crises of the past year. As the
financial turmoil subsided in the first quarter of 1999, however, foreign
investors returned to investing in their own countries rather than in U.S.
dollar-denominated securities. The combination of an increase in interest rates
and a decline in demand caused U.S. Treasuries to drop in price.
At the end of April 1999, the ratio between long-term municipal yields and
30-year Treasury yields stood at 94%, compared with the historical average of
86% for the period of 1986-1999. For investors, this meant that quality long-
term municipal bonds offered yields comparable to those of long Treasury bonds--
even before the tax advantages of municipal
2
<PAGE>
bonds were taken into account. On an after-tax basis in today's market,
municipal bonds continue to present an exceptionally attractive investment
option relative to Treasuries.
During 1998, lower interest rates and the strong economy combined to
generate high levels of new municipal issuance and a significant increase in the
refinancing of existing bonds. Municipal issuance in 1998 reached $284 billion,
up 29% over 1997.
In terms of total municipal issuance, 1998 ranked as the second largest
year on record, next to 1993's $292 billion.
In the first four months of 1999, however, as the market settled into a
more stable interest rate environment, refunding activity dropped off
dramatically. As a result, municipal supply in 1999 has declined by
approximately 25% from the levels of a year ago. This, in turn, has enhanced the
attractiveness of the municipal bonds that were brought to market, as demand--
especially from individual investors--remained relatively strong.
The Value of Nuveen Expertise. Nuveen Mutual Funds are a diverse collection of
investments featuring an impressive ensemble of highly regarded asset management
firms--Premier Advisers/SM/--who direct the investment activities of each
portfolio.
The Premier Advisers are firms that have earned a reputation for excellence
in their field of expertise--whether in municipal bonds, blue-chip growth
stocks, large-cap value stocks, or international securities.
The Premier Advisers include: Nuveen Investment Advisory Services for
income investing, Rittenhouse Financial Services for growth investing, and
Institutional Capital Corporation for value investing.
For more information on Nuveen funds, contact your financial adviser for a
prospectus, or call Nuveen at (800) 621-7227. Please read the prospectus
carefully before you invest or send money.
We encourage you to talk with your financial adviser about Nuveen's
expanding array of investments and the ways that Nuveen funds can help you
establish a diversified portfolio designed to build and sustain long-term
financial security.
Nuveen Municipal Bond Fund and Nuveen Insured Municipal Bond Fund are two
examples of the quality investments that embody Nuveen's income investing
expertise--carrying on a tradition that has been established throughout Nuveen's
100-year history. More than 1.3 million investors have trusted Nuveen to help
them build and sustain the wealth of a lifetime.
We are grateful for the confidence you have placed in us and are dedicated
to maintaining your trust in the years ahead.
Sincerely,
/s/ Timothy R. Schwertfeger
-----------------------------
Timothy R. Schwertfeger
Chairman of the Board
June 15, 1999
"...Municipal supply in 1999 has declined... this has enhanced the
attractiveness of the municipal bonds that were brought to market."
3
<PAGE>
Report from the Portfolio Managers
Nuveen Municipal Bond Fund and Nuveen Insured Municipal Bond Fund closed their
fiscal years April 30, 1999, both outperforming their appropriate Lipper peer
group*. Tom Spalding, portfolio manager of Nuveen Municipal Bond Fund, and Steve
Krupa, portfolio manager of Nuveen Insured Municipal Bond Fund, discuss the
activity within the municipal market during the year, and address the
performance and key investment strategies for their respective funds.
Comments cover the fiscal year ended April 30, 1999, and all performance
statistics are quoted for Class A shares at net asset value.
What economic factors affected the municipal market over the past year? The
major news event of the year was the emerging foreign markets' financial crises,
which caused a surge in the global demand for U.S. Treasury bonds--the world's
most liquid and risk-free securities. This phenomenon is commonly referred to as
a "flight to quality." However, because municipal bonds are not as attractive to
foreign buyers, who generally cannot take advantage of their tax-exempt feature,
the big news in `98 had little affect on the municipal market.
The Federal Reserve Board responded to the global crisis by lowering short-
term interest rates three times between late September and early November. By
early 1999, investor sentiment improved and the crisis appeared to be over.
However, stronger-than-expected U.S. economic growth led to a dramatic selloff
in the Treasury market in February. Municipal bonds outperformed Treasury
securities during the selloff.
As the second quarter of 1999 approached, the foreign economic crises
receded further into the background and the U.S. economy remained buoyant.
However, inflation fears began to take hold as oil prices rebounded and the
consumer price index spiked upward, causing yields on most fixed-income
securities to rise.
Municipal issuance was very strong during the funds' fiscal year, as
issuers took advantage of low interest rates. Because of higher supply and lower
demand, municipal bond yields exceeded taxable yields at times, making it a
rewarding asset class for investors. More typically, municipals yield about 86%
of comparably maturing Treasury bonds.
Tom, how did Nuveen Municipal Bond Fund perform during the year? For the fiscal
year ended April 30, 1999, the total return** for Class A shares on net asset
value was 6.28%, equivalent to a taxable total return of 8.46% for investors in
the 31% federal income tax bracket. The fund's 6.28% total return exceeded the
5.78% average annual total return posted by the Lipper General Municipal Debt
Peer Group*, ranking it 66 out of 258 national municipal bond funds.
What led to such strong performance? For more than 20 years, our objective has
been to achieve the higher returns of longer-term bonds while maintaining the
lower volatility of intermediate securities. As value investors, we try to
identify sectors and geographic regions of the country that we think will
outperform, regardless of the direction of interest rates.
We have also worked hard to maintain a high degree of call protection in
the portfolio. Bonds are typically issued with the right of the issuer to call
or redeem the bond if interest rates fall. We strive to purchase bonds with
seven to 10 years of call protection.
* The Lipper peer group return represents the average annualized returns of the
funds in the Lipper General Municipal Debt Peer Group (for Nuveen Municipal
Bond Fund) and in the Lipper Insured Municipal Debt category (for Nuveen
Insured Municipal Bond Fund). The returns assume reinvestment of dividends
and do not reflect any applicable sales charge.
**Total return is the sum of the fund's income and capital gains distributions
plus price changes in the underlying bond portfolio.
4
<PAGE>
What key strategies were used over the course of the year? Our emphasis on
securities issued by the State of Illinois has been a very successful strategy.
The Midwest, because of its industrial base, has rebounded strongly from the
recession of the early 1990s. As a result, credit quality has improved, leading
to upgrades and price appreciation within Nuveen Municipal Bond Fund's
portfolio.
While we continue to invest in the healthcare industry, we have found that
it is very important to be selective. In our experience, teaching hospitals such
as Northwestern Memorial Hospital have been strong credits. Northwestern
Memorial, one of the leading teaching facilities in Chicago, is gaining market
share, cutting costs and maintaining high levels of liquidity.
We are also comfortable with our investments in hospitals outside the urban
and suburban zones, which are dominant in their service areas. These issues are
generally lower-rated but offer excellent yields.
Turning to Nuveen Insured Municipal Bond Fund, Steve, how did it perform during
its fiscal year? For the fiscal year ended April 30, 1999, the total return on
net asset value was 6.43%, equivalent to a taxable total return of 8.66% for
investors in the 31% federal income tax bracket. This return exceeded the 6.04%
average annual total return posted by the Lipper Insured Municipal Debt Peer
Group*, ranking it 17 of 48 national insured municipal bond funds.
In addition to these performance numbers, we also increased the fund's
dividend during the period.
To what do you attribute the fund's strong relative performance? We chose to
keep the portfolio's duration relatively short during a period when interest
rates were rising, which turned out to be a good move. Bond prices fall when
interest rates rise because investors can purchase new bonds with higher yields.
The shorter the duration, which measures a bond's price volatility, or reaction
to interest rate movements, the less sensitive the bond is to changes in
interest rates.
In addition, raising the dividend reflected our ability to buy higher
yielding bonds during the year. We have also worked hard to maintain a high
degree of call protection in the portfolio. As Tom mentioned, bonds are
typically issued with the right of the issuer to call or redeem the bond if
interest rates fall. We strive to purchase bonds with seven to 10 years of call
protection.
What key strategies were used over the course of the year? Besides our duration
strategy, our value-investing philosophy of seeking undervalued sectors and
individual bonds proved effective during the year.
For example, deregulation in the electric utility industry and the changing
environment of health care has created investment opportunities. Industry
experts predict that electric power will be offered soon to consumers from
national vendors, much like long-distance telephone service is today.
The hospital industry is undergoing consolidation in response to cutbacks
in Medicare and other government reimbursement programs. These changes may
create uncertainty for investors. However, we believe that our extensive
research process allows us to find bonds backed by strong hospitals. These bonds
are temporarily undervalued.
Tom and Steve, what is your outlook for the municipal bond market, as well as
Nuveen Municipal Bond Fund and Nuveen Insured Municipal Bond Fund? We believe
that municipal bonds will continue offering attractive yields in relation to
U.S. Treasury securities. Due to the fact that supply is down and the demand
from retail buyers is growing, we believe that municipals could outperform
taxable bonds over the next six months.
As the outlook for the economy has strengthened over the past several
months, prices for lower-rated bonds have firmed up. Because the extra yield on
lower-rated securities is no longer compelling, we will be very selective in
that area.
We also see the best values for bonds maturing in 20 years rather than 30
years or longer. The 20-year bonds offer most of the yield of the longer
maturities without nearly as much price volatility.
We will continue searching for pockets of opportunity that will help us
maintain the strength of the fund's dividend and total return.
5
<PAGE>
NUVEEN MUNICIPAL BOND FUND
Highlights as of April 30, 1999
Quick Facts
<TABLE>
<CAPTION>
A Shares B Shares C Shares R Shares
<S> <C> <C> <C> <C>
NAV $ 9.57 $ 9.57 $ 9.57 $ 9.58
- ---------------------------------------------------------------------------
April's Dividend $0.0375 $0.0315 $0.0330 $0.0390
- ---------------------------------------------------------------------------
Fund Symbol NMBAX NUMBX N/A NUVBX
- ---------------------------------------------------------------------------
CUSIP 67065Q202 67065Q103 67065Q301 67065Q400
- ---------------------------------------------------------------------------
Inception Date 6/95 2/97 6/95 11/76
- ---------------------------------------------------------------------------
</TABLE>
Total Return (Annualized)/1/
<TABLE>
<CAPTION>
A Shares B Shares C Shares R Shares
NAV Offer NAV NAV NAV
<S> <C> <C> <C> <C> <C>
1-Year 6.28% 1.86% 5.49% 5.91% 6.59%
- -----------------------------------------------------------------------------------------
5-Year 6.97% 6.07% 6.24% 6.29% 7.24%
- -----------------------------------------------------------------------------------------
10-Year 7.18% 6.72% 6.60% 6.43% 7.44%
- -----------------------------------------------------------------------------------------
1-Year TER* 8.46% 3.96% 7.32% 7.84% 8.86%
</TABLE>
* Taxable Equivalent Return (31%)
/1/Class R share returns are actual. Class A, B and C share returns are actual
for the period since class inception; returns prior to class inception are
Class R share returns adjusted for differences in sales charges and expenses,
which are primarily differences in distribution and service fees. Class A
shares have a 4.2% maximum sales charge. Class B shares have a CDSC that
begins at 5% for redemptions during the first year after purchase and
declines periodically to 0% over the following five years, which is not
reflected in the return figures. Class C shares have a 1% CDSC for
redemptions within one year which is not reflected in the one-year total
return.
Index Comparison/2/
[LINE CHART APPEARS HERE]
<TABLE>
<CAPTION>
Nuveen Municipal Nuveen Municipal Lehman Brothers Municipal
Bond Fund (Offer) Bond Fund (NAV) Bond Index
$19,163 $20,004 $21,804
- --------------------------------------------------------------------------
<S> <C> <C> <C>
April 1989 $ 9,580 $10,000 $10,000
- --------------------------------------------------------------------------
10,129 10,573 10,721
- --------------------------------------------------------------------------
11,196 11,687 11,952
- --------------------------------------------------------------------------
12,212 12,747 13,089
- --------------------------------------------------------------------------
13,437 14,026 14,745
- --------------------------------------------------------------------------
13,681 14,281 15,063
- --------------------------------------------------------------------------
14,563 15,201 16,045
- --------------------------------------------------------------------------
15,478 16,156 17,342
- --------------------------------------------------------------------------
16,541 17,267 18,652
- --------------------------------------------------------------------------
18,031 18,821 20,387
- --------------------------------------------------------------------------
April 1999 19,163 20,004 21,804
- --------------------------------------------------------------------------
</TABLE>
Monthly Tax-Free Dividends (Class A Shares)/3/
[BAR CHART APPEARS HERE]
<TABLE>
<CAPTION>
<S> <C>
May 1998 .0375
- -----------------------
June 1998 .0375
- -----------------------
July 1998 .0375
- -----------------------
August 1998 .0375
- -----------------------
September 1998 .0375
- -----------------------
October 1998 .0375
- -----------------------
November 1998 .0375
- -----------------------
December 1998 .0375
- -----------------------
January 1999 .0375
- -----------------------
February 1999 .0375
- -----------------------
March 1999 .0375
- -----------------------
April 1999 .0375
- -----------------------
</TABLE>
/3/The Fund also paid shareholders capital gains and net ordinary income
distributions in December of $0.0256 per share.
Portfolio Statistics
<TABLE>
<CAPTION>
<S> <C>
Fund Net Assets $3.0 billion
- -------------------------------------------
Effective Maturity 17.44 years
- -------------------------------------------
Average
Effective Duration 5.99
- -------------------------------------------
</TABLE>
Top Five Sectors
<TABLE>
<CAPTION>
<S> <C>
Utilities 23%
- -------------------------------------------
Health Care 18%
- -------------------------------------------
U.S. Guaranteed 15%
- -------------------------------------------
Tax Obligation (Limited) 9%
- -------------------------------------------
Water and Sewer 9%
- -------------------------------------------
</TABLE>
Bond Credit Quality**
[PIE CHART APPEARS HERE]
AAA/U.S. Grtd................44%
AA...........................34%
A............................13%
BBB/NR....................... 9%
**as a percentage of total bond holdings
Returns are historical and do not guarantee future performance. Investment
returns and principal value will fluctuate so that when shares are redeemed,
they may be worth more or less than original cost. Performance of classes will
differ. For additional information, please see the fund's prospectus.
/2/ The Index Comparison shows the change in value of a $10,000 investment in
the Class A shares of the Nuveen fund compared with the Lehman Brothers
Municipal Bond Index. The Lehman Municipal Bond Index is comprised of a broad
range of investment-grade municipal bonds, and does not reflect any initial or
ongoing expenses. The Nuveen fund return depicted in the chart reflects the
initial maximum sales charge applicable to A shares (4.20%) and all ongoing fund
expenses. For periods prior to inception of Class A shares, performance reflects
Class R share performance adjusted for differences in expenses, which are
primarily differences in distribution and service fees.
Past performance is not predictive of future results.
6
<PAGE>
NUVEEN INSURED MUNICIPAL BOND FUND
Highlights as of April 30, 1999
<TABLE>
<CAPTION>
Quick Facts
A Shares B Shares C Shares R Shares
<S> <C> <C> <C> <C>
NAV $ 11.16 $ 11.16 $ 11.05 $ 11.11
- ----------------------------------------------------------------------------------
April's Dividend $0.0450 $0.0380 $0.0395 $0.0465
- ----------------------------------------------------------------------------------
Fund Symbol NMBIX NMBBX NMBKX NITNX
- ----------------------------------------------------------------------------------
CUSIP 67065Q509 67065Q608 67065Q707 67065Q806
- ----------------------------------------------------------------------------------
Inception Date 9/94 2/97 9/94 12/86
- ----------------------------------------------------------------------------------
</TABLE>
Total Return (Annualized)/1/
<TABLE>
<CAPTION>
A Shares B Shares C Shares R Shares
NAV Offer NAV NAV NAV
<S> <C> <C> <C> <C> <C>
1-Year 6.43% 1.99% 5.63% 5.86% 6.62%
- ----------------------------------------------------------------------------------------------
5-Year 7.21% 6.29% 6.38% 6.38% 7.37%
- ----------------------------------------------------------------------------------------------
10-Year 7.68% 7.21% 7.06% 6.86% 7.89%
- ----------------------------------------------------------------------------------------------
1-Year TER* 8.66% 4.13% 7.51% 7.83% 8.94%
</TABLE>
* Taxable Equivalent Return (31%)
/1/ Class R share returns are actual. Class A, B and C share returns are actual
for the period since class inception; returns prior to class inception are
Class R share returns adjusted for differences in sales charges and
expenses, which are primarily differences in distribution and service fees.
Class A shares have a 4.2% maximum sales charge. Class B shares have a CDSC
that begins at 5% for redemptions during the first year after purchase and
declines periodically to 0% over the following five years, which is not
reflected in the return figures. Class C shares have a 1% CDSC for
redemptions within one year which is not reflected in the one-year total
return.
Index Comparison/2/
[LINE CHART APPEARS HERE]
<TABLE>
<CAPTION>
Lehman Brothers Municipal Nuveen Ins Municipal Nuveen Ins Municipal
Bond Index Bond Fund (NAV) Bond Fund (Offer)
$21,804 $20,946 $20,066
- -----------------------------------------------------------------------------
<S> <C> <C>
$10,000 $10,000 $ 9,580
- -----------------------------------------------------------------------------
$10,721 $10,502 $10,061
- -----------------------------------------------------------------------------
$11,953 $11,720 $11,228
- -----------------------------------------------------------------------------
$13,090 $12,909 $12,367
- -----------------------------------------------------------------------------
$14,746 $14,657 $14,041
- -----------------------------------------------------------------------------
$15,063 $14,791 $14,170
- -----------------------------------------------------------------------------
$16,065 $15,864 $15,198
- -----------------------------------------------------------------------------
$17,343 $17,009 $16,295
- -----------------------------------------------------------------------------
$18,652 $18,049 $17,291
- -----------------------------------------------------------------------------
$20,387 $19,682 $18,855
- -----------------------------------------------------------------------------
$21,804 $20,946 $20,066
- -----------------------------------------------------------------------------
</TABLE>
Past performance is not predictive of future results.
Monthly Tax-Free Dividends (Class A Shares)/3/
[BAR CHART APPEARS HERE]
<TABLE>
<S> <C>
May 1998 .0445
June 1998 .0445
July 1998 .0445
August 1998 .0445
September 1998 .0445
October 1998 .0445
November 1998 .0445
December 1998 .0445
January 1999 .0450
February 1999 .0450
March 1999 .0450
April 1999 .0450
</TABLE>
/3/ The Fund also paid shareholders capital gains and net ordinary income
distributions in December of $0.0326 per share.
Portfolio Statistics
<TABLE>
<S> <C>
Fund Net Assets $861 million
- -----------------------------------------------------
Effective Maturity 18.10 years
- -----------------------------------------------------
Average
Effective Duration 6.26
- -----------------------------------------------------
Top Five Sectors
U.S. Guaranteed 32%
- -----------------------------------------------------
Health Care 15%
- -----------------------------------------------------
Tax Obligation (General) 11%
- -----------------------------------------------------
Utilities 10%
- -----------------------------------------------------
Housing (Single Family) 9%
- -----------------------------------------------------
</TABLE>
Bond Credit Quality**
[PIE CHART APPEARS HERE]
Insured 68%
Insured & U.S.
Guaranteed 29%
U.S. Guaranteed 3%
**as a percentage of total bond holdings
Returns are historical and do not guarantee future performance. Investment
returns and principal value will fluctuate so that when shares are redeemed,
they may be worth more or less than original cost. Performance of classes will
differ. For additional information, please see the fund's prospectus.
/2/ The Index Comparison shows the change in value of a $10,000 investment in
the Class A shares of the Nuveen fund compared with the Lehman Brothers
Municipal Bond Index. The Lehman Municipal Bond Index is comprised of a
broad range of investment-grade municipal bonds, and does not reflect any
initial or ongoing expenses. The Nuveen fund return depicted in the chart
reflects the initial maximum sales charge applicable to A shares (4.20%) and
all ongoing fund expenses. For periods prior to inception of Class A shares,
performance reflects Class R share performance adjusted for differences in
expenses, which are primarily differences in distribution and service fees.
Past performance is not predictive of future results.
7
<PAGE>
<TABLE>
<CAPTION>
Portfolio of Investments
Nuveen Municipal Bond Fund
April 30, 1999
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Alabama -- 1.4%
$ 3,255,000 The Board of Trustees of Alabama, Agricultural and Mechanical 5/08 at 102 AAA $ 3,173,332
University, Revenue Bonds, Series 1998, 5.000%, 11/01/25
7,000,000 City of Birmingham, Alabama, Water and Sewer Revenue Warrants, Series 1/08 at 101 AA- 6,500,900
1998-A, 4.750%, 1/01/29
Jefferson County, Alabama, Sewer Revenue Capital Improvement
Warrants, Series 1999-A:
4,000,000 5.750%, 2/01/38 2/09 at 101 AAA 4,271,280
16,000,000 5.125%, 2/01/39 2/09 at 101 AAA 15,653,280
12,000,000 Baptist Medical Center Special Care Facilities Financing Authority 11/08 at 101 AAA 11,554,440
of the City of Montgomery, Alabama, Revenue Bonds, Series 1998-B
(Baptist Health), 5.000%, 11/15/29
- ------------------------------------------------------------------------------------------------------------------------------------
Alaska -- 0.4%
12,375,000 Alaska Housing Finance Corporation, Collateralized Home Mortgage 12/03 at 102 AAA 12,624,604
Bonds, 1990 Series A, 5.850%, 6/01/25
- ------------------------------------------------------------------------------------------------------------------------------------
Arizona -- 2.4%
7,750,000 Arizona Board of Regents, Arizona State University, System Revenue 7/02 at 101 AA 8,230,965
Refunding Bonds, Series 1992-A, 5.750%, 7/01/12
21,600,000 Salt River Project Agricultural Improvement and Power District, 1/02 at 100 AA 22,095,288
Arizona, Salt River Project Electric System Revenue Bonds, 1992
Series C, 5.500%, 1/01/28
8,580,000 Salt River Project Agricultural Improvement and Power District, 7/99 at 100 AA 8,646,495
Arizona, Salt River Project Electric System Revenue Bonds, 1973
Series A, 5.000%, 1/01/10
Salt River Project Agricultural Improvement and Power District,
Arizona, Salt River Project Electric System Revenue Refunding Bonds,
1993 Series C:
5,000,000 4.900%, 1/01/08 1/04 at 102 AA 5,176,450
19,320,000 4.750%, 1/01/17 1/04 at 100 AA 18,679,349
7,000,000 The Industrial Development Authority of the City of Scottsdale, Arizona, 9/01 at 102 AAA 7,394,940
Hospital Revenue Refunding Bonds (Scottsdale Memorial Hospitals),
Series 1996-A, 5.625%, 9/01/12
- ------------------------------------------------------------------------------------------------------------------------------------
Arkansas -- 0.5%
11,210,000 Jefferson County, Arkansas, Hospital Refunding Revenue Bonds, 7/03 at 102 A 12,162,177
Series 1993, 6.000%, 7/01/06
4,000,000 Jefferson County, Arkansas, Pollution Control Revenue Refunding 12/02 at 102 BBB- 4,015,000
Bonds (Entergy Arkansas, Inc. Project), Series 1997,
5.600%, 10/01/17
- ------------------------------------------------------------------------------------------------------------------------------------
California -- 13.3%
21,220,000 California Health Facilities Financing Authority, Insured 7/04 at 102 AAA 21,402,916
Health Facility Refunding Revenue Bonds (Catholic Healthcare West),
1994 Series A, 5.000%, 7/01/14
State of California, Department of Water Resources, Central Valley Project,
Water System Revenue Bonds, Series L:
15,515,000 5.700%, 12/01/16 6/03 at 101 1/2 AA 16,417,042
9,500,000 5.750%, 12/01/19 6/03 at 101 1/2 AA 10,029,720
12,250,000 5.500%, 12/01/23 6/03 at 101 1/2 AA 12,644,083
21,000,000 State of California, Department of Water Resources, Central 12/03 at 101 AA 20,185,410
Valley Project, Water System Revenue Bonds, Series M,
4.875%, 12/01/27
12,000,000 State Public Works Board of the State of California, Lease 11/04 at 102 Aaa 14,148,120
Revenue Bonds (Department of Corrections), 1994 Series A
(California State Prison-Monterey County (Soledad II)),
7.000%, 11/01/19 (Pre-refunded to 11/01/04)
11,500,000 California Statewide Communities Development Authority, 10/03 at 102 AAA 12,380,325
Insured Health Facilities Revenue, Certificates of Participation
(UniHealth America), 1993 Series A, 5.500%, 10/01/14
</TABLE>
8
<PAGE>
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- -----------------------------------------------------------------------------------------------------------------------------------
<C> <S> <C> <C> <C>
California (continued)
$38,795,000 California Statewide Communities Development Authority, 7/03 at 102 AA $39,409,901
Certificates of Participation, St. Joseph Health System
Obligated Group, 5.500%, 7/01/23
15,725,000 Central Joint Powers Health Financing Authority, Certificates 2/03 at 102 Baa1 15,905,680
of Participation, Series 1993 (Community Hospital of
Central California), 5.250%, 2/01/13
9,000,000 East Bay Municipal Utility District (Alameda and Contra Costa 6/03 at 102 AAA 8,863,560
Counties, California), Water System Subordinated Revenue
Refunding Bonds, Series 1993A, 5.000%, 6/01/21
Foothill/Eastern Transportation Corridor Agency, California,
Toll Road Revenue Bonds, Series 1995A:
45,000,000 0.000%, 1/01/23 No Opt. Call BBB- 12,728,700
15,000,000 6.000%, 1/01/34 1/05 at 102 BBB- 16,116,150
17,040,000 Los Angeles Convention and Exhibition Center Authority, Lease 8/03 at 102 AAA 17,433,965
Revenue Bonds, 1993 Refunding Series A, City of Los Angeles,
California, 5.125%, 8/15/13
17,575,000 Department of Water and Power of the City of Los Angeles, 4/02 at 102 AA*** 19,228,456
California, Water Works Revenue Bonds, Issue of 1992,
6.500%, 4/15/32
16,000,000 The City of Los Angeles, California, Refunding Series 1993-B, 6/03 at 102 AAA 16,924,320
5.700%, 6/01/23
20,670,000 The City of Los Angeles, California, Wastewater System Revenue 11/03 at 102 AAA 20,891,376
Bonds, Series 1993-D, 5.200%, 11/01/21
15,750,000 Los Angeles County Metropolitan Transit Authority, Proposition 7/03 at 102 AA- 16,515,765
A, Sales Tax Revenue Refunding Bonds, Series 1993-A, 5.500%,
7/01/13
Los Angeles County Metropolitan Transit Authority,
Proposition C, Sales Tax Revenue Second Senior Bonds,
Series 1993-B:
20,935,000 4.750%, 7/01/18 7/03 at 102 AAA 20,355,938
8,000,000 5.250%, 7/01/23 7/03 at 102 AAA 8,106,560
10,500,000 Los Angeles County Sanitation Districts Financing Authority, 10/03 at 102 AA 11,081,805
Capital Projects Revenue Bonds, 1993 Series A (Senior Ad
Valorem Obligation Bonds), 5.375%, 10/01/13
31,360,000 Los Angeles County Transportation Commission, California, 7/02 at 102 Aaa 34,947,270
Proposition C, Sales Tax Revenue, Second Senior Bonds,
Series 1992-A, 6.750%, 7/01/19 (Pre-refunded to 7/01/02)
5,000,000 The Metropolitan Water District of Southern California, Water 7/02 at 102 AA 5,210,450
Revenue Bonds, Issue of 1992, 5.500%, 7/01/19
17,700,000 Sacramento County Sanitation Districts Financing Authority, 12/03 at 102 AA 16,730,040
1993 Revenue Bonds, 4.750%, 12/01/23
8,050,000 The Regents of the University of California, Refunding Revenue 9/02 at 102 AAA 9,039,989
Bonds (Multiple Purpose Projects), Series A, 6.875%,
9/01/16 (Pre-refunded to 9/01/02)
- -----------------------------------------------------------------------------------------------------------------------------------
Colorado -- 1.0%
22,060,000 Colorado Housing and Finance Authority, Single Family Housing 11/01 at 102 Aa1 23,214,620
Revenue Refunding Bonds, 1991 Series A, 7.250%, 11/01/31
6,595,000 City and County of Denver, Colorado, Airport System Revenue 11/01 at 100 AAA 6,890,588
Bonds, Series 1996D, 5.875%, 11/15/16
- -----------------------------------------------------------------------------------------------------------------------------------
Connecticut -- 0.1%
2,970,000 Connecticut Resources Recovery Authority, Bridgeport Resco 7/99 at 100 1/2 A 2,995,275
Company, L.P. Project Bonds, Series B, 8.625%, 1/01/04
- -----------------------------------------------------------------------------------------------------------------------------------
District of Columbia -- 0.6%
20,700,000 Washington Convention Center Authority (Washington, D.C.), 10/08 at 100 AAA 19,055,385
Senior Lien Dedicated Tax Revenue Bonds, Series 1998, 4.750%, 10/01/28
- -----------------------------------------------------------------------------------------------------------------------------------
Florida -- 2.1%
31,000,000 Hillsborough County Industrial Development Authority, 5/02 at 103 AA 35,201,740
Pollution Control Revenue Refunding Bonds (Tampa Electric
Company Project), Series 1992, 8.000%, 5/01/22
25,000,000 Orlando Utilities Commission, Water and Electric Subordinated 10/99 at 100 Aa2 24,396,250
Revenue Bonds, Series 1989D, 5.000%, 10/01/23
1,270,000 The Elderly Housing Corporation of Sarasota, Inc. (Elderly 7/99 at 103 N/R 1,313,282
Housing Project for the Sarasota Housing Authority),
First Mortgage Revenue Bonds, Series 1978, 7.500%, 7/01/09
</TABLE>
9
<PAGE>
Portfolio of Investments
Nuveen Municipal Bond Fund (continued)
April 30, 1999
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Hawaii - 0.3%
$ 8,000,000 Department of Budget and Finance of the State of Hawaii, Special Purpose 7/01 at 102 AAA $ 8,813,440
Revenue Bonds, Kapiolani Health Care System Obligated Group (Pali Momi
Medical Center Project), Series 1991, 7.650%, 7/01/19 (Pre-refunded to
7/01/01)
- -----------------------------------------------------------------------------------------------------------------------------------
Illinois - 19.2%
16,545,000 City of Chicago, General Obligation Bonds (Emergency Telephone System), 1/03 at 102 AAA 17,889,943
Series 1993, 5.625%, 1/01/23 (Pre-refunded to 1/01/03)
7,880,000 City of Chicago, General Obligation Bonds, Series 1993, 5.250%, 1/01/18 1/04 at 102 AAA 7,947,768
21,335,000 Chicago Metropolitan Housing Development Corporation, Housing Development 7/02 at 102 AA 22,846,585
Revenue Refunding Bonds (FHA-Insured Mortgage Loans--Section 8 Assisted
Projects), Series 1992B, 6.900%, 7/01/22
7,965,000 City of Chicago, Motor Fuel Tax Revenue Bonds, Refunding Series 1993, 1/03 at 101 AAA 7,871,332
5.000%, 1/01/16
21,710,000 City of Chicago (Illinois), Chicago O'Hare International Airport, General 1/04 at 102 AAA 21,384,784
Airport Second Lien Revenue Refunding Bonds, 1993 Series C, 5.000%, 1/01/18
61,150,000 City of Chicago (Illinois), Chicago O'Hare International Airport, General 1/04 at 102 A+ 60,093,940
Airport Revenue Refunding Bonds, 1993 Series A, 5.000%, 1/01/16
22,335,000 City of Chicago, Water Revenue Bonds, Series 1995, 5.000%, 11/01/15 11/06 at 102 AAA 22,360,015
25,380,000 The County of Cook (Illinois), General Obligation Bonds, Series 1993A, 11/03 at 100 AAA 24,458,706
5.000%, 11/15/23
17,300,000 DuPage Water Commission (DuPage, Cook and Will Counties, Illinois), 3/02 at 100 AAA 18,148,911
Illinois), General Obligation Water Refunding Bonds, Series 1992,
5.750%, 3/01/11
11,350,000 DuPage Water Commission (DuPage, Cook and Will Counties, Illinois), Water 5/03 at 102 Aa1 11,718,081
Refunding Revenue Bonds, Series 1993, 5.250%, 5/01/14
8,500,000 Illinois Development Finance Authority, Revenue and Refunding Bonds, 2/00 at 102 Baa2*** 8,985,350
Series 1990A (Columbus-Cuneo-Cabrini Medical Center), 8.500%, 2/01/15
(Pre-refunded to 2/01/00)
17,075,000 Illinois Educational Facilities Authority, Revenue Refunding Bonds, 7/03 at 102 Aa1 17,689,700
The University of Chicago, Series 1993B, 5.600%, 7/01/24
55,100,000 Illinois Health Facilities Authority, Revenue Bonds, Series 1994A 8/04 at 102 AA 58,809,883
(Northwestern Memorial Hospital), 6.000%, 8/15/24
6,115,000 Illinois Health Facilities Authority, Revenue Refunding Bonds, 10/03 at 102 A- 6,116,345
Series 1993 (Illinois Masonic Medical Center), 5.500%, 10/01/19
10,000,000 Illinois Health Facilities Authority, Revenue Bonds, Series 1992 10/02 at 102 AAA 10,835,700
(Highland Park Hospital), 6.200%, 10/01/22
34,120,000 Illinois Health Facilities Authority, Revenue Bonds, Series 1993 11/03 at 102 AAA 34,728,018
(Rush-Presbyterian-St. Luke's Medical Center Obligated Group), 5.500%,
11/15/25
7,275,000 Illinois Health Facilities Authority, Revenue Bonds, Series 1994 3/04 at 102 AAA 8,003,155
(Southern Illinois Hospital Services), 5.850%, 3/01/14 (Pre-refunded
to 3/01/04)
3,000,000 Illinois Health Facilities Authority, Revenue Bonds, Series 1998A 11/08 at 101 AAA 2,880,840
(Rush-Presbyterian-St. Luke's Medical Center Obligated Group), 5.000%,
11/15/24
15,000,000 Illinois Health Facilities Authority, FHA-Insured Mortgage Revenue 2/06 at 102 AAA 16,049,700
Bonds, Series 1996 (Sinai Health System), 6.000%, 2/15/24
15,100,000 State of Illinois, General Obligation Bonds, Series of March 1992 10/02 at 102 AA 16,465,795
(Full Faith and Credit), 6.200%, 10/01/04
State of Illinois, General Obligation Bonds, Series of August 1992
(Full Faith and Credit):
14,750,000 5.875%, 6/01/10 6/02 at 102 AA 15,783,680
5,000,000 5.875%, 6/01/11 6/02 at 102 AA 5,357,950
10,000,000 State of Illinois, General Obligation Bonds, Series of April 1993 4/03 at 102 AA 10,614,800
(Full Faith & Credit), 5.700%, 4/01/18
14,200,000 State of Illinois, Build Illinois Bonds (Sales Tax Revenue Bonds), 6/03 at 102 AAA 14,373,240
Series S, 5.250%, 6/15/18
15,315,000 State of Illinois, Build Illinois Bonds (Sales Tax Revenue Bonds), 6/01 at 100 AAA 15,965,581
Series O, 6.000%, 6/15/18
The Illinois State Toll Highway Authority, Toll Highway Priority
Revenue Bonds, 1992 Series A:
20,000,000 6.450%, 1/01/13 (Pre-refunded to 1/01/03) 1/03 at 102 AA-*** 22,157,400
8,805,000 6.200%, 1/01/16 (Pre-refunded to 1/01/03) 1/03 at 102 AAA 9,692,808
</TABLE>
10
<PAGE>
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Illinois (continued)
Metropolitan Pier and Exposition Authority (Illinois),
McCormick Place Expansion Project Bonds, Series 1992A:
$11,305,000 0.000%, 6/15/17 No Opt. Call AAA $ 4,474,180
43,180,000 6.500%, 6/15/27 (Pre-refunded to 6/15/03) 6/03 at 102 Aaa 48,426,370
15,950,000 Metropolitan Pier and Exposition Authority (Illinois), No Opt. Call AAA 4,894,736
McCormick Place Expansion Project Refunding Bonds, Series
1996A, 0.000%, 12/15/21
16,510,000 Metropolitan Pier and Exposition Authority (Illinois), 6/07 at 101 AAA 17,116,082
Dedicated State Tax Revenue Bonds, Series 1997, 5.125%, 6/01/11
5,000,000 Regional Transportation Authority, Cook, DuPage, Kane, Lake, 6/03 at 102 AAA 5,471,700
McHenry and Will Counties (Illinois), General Obligation
Refunding Bonds, Series 1993B, 5.800%, 6/01/13
(Pre-refunded to 6/01/03)
1,615,000 The Elderly Housing Corporation of Zion (Illinois), Housing 9/99 at 102 A 1,659,219
Development Revenue Bonds (Dell-Zion Associates-Section 8
Assisted Project), Series 1978, 7.750%, 3/01/10
- ------------------------------------------------------------------------------------------------------------------------------------
Indiana -- 3.6%
10,835,000 Duneland School Building Corporation, First Mortgage Bonds, 8/07 at 101 AAA 11,851,431
Series 1997, 5.450%, 8/01/15 (Pre-refunded to 8/01/07)
11,590,000 Indiana Health Facility Financing Authority, Hospital Revenue 9/02 at 102 AAA 12,536,092
Refunding Bonds, Series 1992A (Methodist Hospital of
Indiana, Inc.), 5.750%, 9/01/11
49,600,000 Indiana Health Facilities Financing Authority, Hospital 11/03 at 102 Aa2 51,331,040
Revenue Bonds (Daughters of Charity), Series 1993, 5.750%, 11/15/22
10,100,000 Indiana State Office Building Commission Correctional 12/01 at 102 Aa3*** 10,966,075
Facilities Program, Revenue Bonds, Series 1991, 6.375%,
7/01/16 (Pre-refunded to 12/01/01)
2,750,000 The Indianapolis Local Public Improvement Bond Bank, Series 2/03 at 102 AA 3,016,283
1992 D, 6.750%, 2/01/20
12,500,000 The Indianapolis Local Public Improvement Bond Bank, Series 1/03 at 102 AAA 13,447,125
1993 A, 6.000%, 1/10/18
2,350,000 Southwind Housing, Inc., 7.125%, 11/15/21 No Opt. Call N/R*** 2,616,937
- ------------------------------------------------------------------------------------------------------------------------------------
Iowa -- 0.2%
3,815,000 City of Davenport, Iowa, Hospital Facility Revenue Bonds 7/02 at 100 AAA 4,216,567
(Mercy Hospital Project), Series 1992, 6.625%, 7/01/14
(Pre-refunded to 7/01/02)
2,915,000 Iowa Housing Finance Authority, Single Family Mortgage Bonds, 8/99 at 100 Aaa 2,924,853
1977 Series A, 5.875%, 8/01/08
- ------------------------------------------------------------------------------------------------------------------------------------
Kentucky -- 3.0%
34,500,000 County of Carroll, Kentucky, Collateralized Pollution Control 9/02 at 102 Aa2 38,643,795
Revenue Bonds (Kentucky Utilities Company Project), 1992
Series A, 7.450%, 9/15/16
1,725,000 Kentucky Housing Corporation, Housing Revenue Bonds 7/01 at 102 AAA 1,801,694
(FHA-Insured/VA Guaranteed), 1991 Series A, 7.250%, 1/01/17
Kentucky Housing Corporation, Housing Revenue Bonds, 1993
Series B (Federally Insured or Guaranteed Mortgage Loans):
17,600,000 5.300%, 7/01/10 1/04 at 102 AAA 18,207,552
14,400,000 5.400%, 7/01/14 1/04 at 102 AAA 14,870,592
16,980,000 The Turnpike Authority of Kentucky, Resource Recovery Road 7/99 at 100 A+ 16,985,434
Revenue Refunding Bonds, 1987 Series A, 5.000%, 7/01/08
- ------------------------------------------------------------------------------------------------------------------------------------
Maine -- 0.8%
Maine State Housing Authority, Mortgage Purchase Bonds, 1994
Series A:
13,650,000 5.650%, 11/15/20 2/04 at 102 AA 13,901,433
10,000,000 5.700%, 11/15/26 2/04 at 102 AA 10,178,300
- ------------------------------------------------------------------------------------------------------------------------------------
Maryland -- 0.1%
2,500,000 Community Development Administration, Maryland Department of 1/07 at 102 Aa2 2,654,100
Housing and Community Development, Housing Revenue Bonds,
Series 1996A, 5.875%, 7/01/16
</TABLE>
11
<PAGE>
Portfolio of Investments
Nuveen Municipal Bond Fund (continued)
April 30, 1999
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Massachusetts -- 3.1%
$15,000,000 Massachusetts Bay Transportation Authority, Certificates of 8/00 at 102 AAA $16,067,550
Participation, 1990 Series A, 7.650%, 8/01/15
(Pre-refunded to 8/01/00)
5,170,000 The Commonwealth of Massachusetts, General Obligation Refunding No Opt. Call AA- 5,335,595
Bonds, 1993 Series C, 4.700%, 8/01/02
Massachusetts Water Resources Authority, General Revenue Bonds,
1990 Series A:
6,500,000 7.500%, 4/01/16 (Pre-refunded to 4/01/00) 4/00 at 102 AAA 6,875,700
9,605,000 6.000%, 4/01/20 (Pre-refunded to 4/01/00) 4/00 at 100 AAA 9,845,989
Massachusetts Water Resources Authority, General Revenue Refunding
Bonds, 1993 Series B:
14,890,000 5.250%, 3/01/13 3/03 at 102 A1 15,360,226
10,795,000 5.000%, 3/01/22 3/03 at 100 A1 10,444,594
Massachusetts Water Resources Authority, General Revenue Bonds,
1993 Series C:
12,705,000 5.250%, 12/01/20 (Pre-refunded to 12/01/04) 12/04 at 102 Aaa 13,779,589
13,345,000 5.250%, 12/01/20 12/04 at 102 A1 13,373,291
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan -- 6.0%
15,000,000 School District of the City of Detroit, Wayne County, Michigan, 5/06 at 102 AAA 16,639,950
School Building and Site Improvement Bonds (Unlimited Tax General
Obligation), Series 1996A, 5.700%, 5/01/25
(Pre-refunded to 5/01/06)
10,000,000 School District of the City of Detroit, Wayne County, Michigan, 5/09 at 101 AAA 9,379,600
School Building and Site Improvement Bonds (Unlimited Tax
General Obligation), Series 1998B, 4.750%, 5/01/28
3,370,000 Michigan Higher Education Facilities Authority, Limited 5/08 at 100 AA 3,332,323
Obligation Revenue and Revenue Refunding Bonds, Series 1998C
(Aquinas College Project), 5.125%, 5/01/16
State Building Authority, State of Michigan, 1998 Revenue Bonds Series I
(Facilities Program):
7,500,000 4.750%, 10/15/17 10/09 at 100 AA 7,253,625
6,000,000 4.750%, 10/15/21 10/09 at 100 AA 5,671,140
Michigan State Hospital Finance Authority, Hospital Revenue and Refunding
Bonds (The Detroit Medical Center Obligated Group), Series 1993B:
19,585,000 5.750%, 8/15/13 8/04 at 102 BBB 19,395,026
69,575,000 5.500%, 8/15/23 8/04 at 102 BBB 66,258,360
3,000,000 Michigan State Hospital Finance Authority, Hospital Revenue 10/05 at 100 AAA 3,576,990
Refunding Bonds (Genesys Health System Obligated Group),
Series 1995A, 7.500%, 10/01/27 (Pre-refunded to 10/01/05)
12,080,000 Michigan State Housing Development Authority, Rental Housing 4/04 at 102 AAA 12,583,253
Revenue Bonds, 1994 Series B, 5.700%, 4/01/12
15,600,000 State of Michigan, State Trunk Line Fund Bonds, Series 1992A, 10/02 at 100 AA- 16,116,204
5.500%, 10/01/21
16,805,000 Hospital Finance Authority of the City of St. Joseph, Revenue 1/04 at 102 AAA 16,949,523
Refunding Bonds (Mercy Memorial Medical Center Obligated Group),
Series 1993, 5.250%, 1/01/16
- ------------------------------------------------------------------------------------------------------------------------------------
Minnesota -- 0.4%
2,110,000 Minnesota Housing Finance Agency, Housing Development Bonds, 8/99 at 101 AA 2,139,835
1977 Series A, 6.250%, 2/01/20
8,375,000 Minnesota Housing Finance Agency, Rental Housing Bonds, 1995 2/05 at 102 AAA 8,805,978
Series D, 5.800%, 8/01/11
- ------------------------------------------------------------------------------------------------------------------------------------
Mississippi -- 0.3%
7,500,000 Mississippi Business Finance Corporation, Pollution Control 10/03 at 102 BBB- 7,537,350
Revenue Refunding Bonds (System Energy Resources, Inc. Project),
Series 1998, 5.875%, 4/01/22
- ------------------------------------------------------------------------------------------------------------------------------------
Missouri -- 0.9%
3,650,000 The Industrial Development Authority of the City of Kansas City, 11/08 at 102 N/R 3,533,200
Missouri, Retirement Facility Refunding and Improvement Revenue Bonds,
Series 1998A (Kingswood Project), 5.800%, 11/15/17
6,195,000 Missouri Housing Development Commission, Housing Development Bonds, 9/99 at 101 AA+ 6,307,006
Series B 1979 (Federally Insured Mortgage Bonds), 7.000%, 9/15/22
15,750,000 Health and Educational Facilities Authority of the State of 10/99 at 102 1/2 BBB+ 16,437,015
Missouri, Health Facilities Refunding and Improvement Revenue
Bonds (Heartland Health Systems Project), Series 1989,
8.125%, 10/01/10
</TABLE>
12
<PAGE>
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Montana - 0.2%
$ 5,825,000 Montana Health Facility Authority, Health Care Revenue Bonds, Series 1996 6/06 at 102 BBB- $ 6,134,249
(Community Medical Center, Inc.), 6.375%, 6/01/18
- -----------------------------------------------------------------------------------------------------------------------------------
Nebraska - 0.8%
23,515,000 Consumers Public Power District, Nebraska, Nuclear Facility Revenue Bonds, 7/99 at 100 A+ 23,542,277
1968 Series, 5.100%, 1/01/03
- -----------------------------------------------------------------------------------------------------------------------------------
Nevada - 0.4%
2,000,000 City of Henderson, Nevada, Local Improvement District No. T-4 (Green 5/09 at 103 N/R 1,998,840
Valley Properties), Senior Limited Obligation Refunding Bonds, 1999
Series A, 5.900%, 11/01/18
8,630,000 City of Reno, Nevada, Insured Hospital Revenue Bonds (St. Mary's Regional 5/03 at 102 AAA 9,264,391
Medical Center), Series 1993A, 5.800%, 5/15/13
- -----------------------------------------------------------------------------------------------------------------------------------
New Hampshire - 0.3%
8,500,000 The Industrial Development Authority of the State of New Hampshire, 12/01 at 103 A- 9,239,330
Pollution Control Revenue Bonds (Central Maine Power Company Project),
1984 Series B, 7.375%, 5/01/14
- -----------------------------------------------------------------------------------------------------------------------------------
New Jersey - 0.4%
10,750,000 New Jersey Housing and Mortgage Finance Agency, Housing Revenue Bonds, 1992 5/02 at 102 A+ 11,644,830
Series A, 6.950%, 11/01/13
- -----------------------------------------------------------------------------------------------------------------------------------
New York - 7.0%
11,190,000 Battery Park City Authority, Senior Revenue Refunding Bonds, Series 1993A, 11/03 at 102 AA 11,230,060
5.000%, 11/01/13
5,000,000 Municipal Assistance Corporation for the City of New York (A Public No Opt. Call AA 5,581,800
Benefit Corporation of the State of New York), Series L Bonds (Issued
Pursuant to the 1991 General Bond Resolution), 6.000%, 7/01/07
2,350,000 The City of New York, General Obligation Bonds, Fiscal 1996 Series C, No Opt. Call A- 2,560,889
6.000%, 8/15/04
8,000,000 The City of New York, General Obligation Bonds, Fiscal 1994 Series D, 8/03 at 101 1/2 A- 8,435,120
5.750%, 8/15/11
8,525,000 The City of New York, General Obligation Bonds, Fiscal 1992 Series C, 8/02 at 101 1/2 AAA 9,416,204
Fixed Rate Bonds, Subseries C-1, 6.625%, 8/01/12 (Pre-refunded to
8/01/02)
The City of New York, General Obligation Bonds, Fiscal 1996 Series G:
7,500,000 5.900%, 2/01/05 No Opt. Call A- 8,157,450
12,655,000 5.750%, 2/01/17 2/06 at 101 1/2 A- 13,459,352
15,620,000 The City of New York, General Obligation Bonds, Fiscal 1997 Series E, 8/06 at 101 1/2 A- 16,986,594
6.000%, 8/01/16
14,000,000 The City of New York, General Obligation Bonds, Fiscal 1995 Series F, 2/05 at 101 A-*** 15,973,860
6.625%, 2/15/25 (Pre-refunded to 2/15/05)
11,770,000 The City of New York, General Obligation Bonds, Fiscal 1998 Series J, 8/08 at 101 A- 12,341,316
5.375%, 8/01/13
4,000,000 The City of New York, General Obligation Bonds, Fiscal 1999 Series H, 3/09 at 101 A- 3,823,680
5.000%, 3/15/29
8,600,000 New York City Municipal Water Finance Authority, Water and Sewer 6/02 at 101 1/2 A1 9,199,678
System Revenue Bonds, Fiscal 1993 Series A, 6.000%, 6/15/17
10,000,000 New York City Transitional Finance Authority, Future Tax Secured 5/09 at 101 AA 9,426,800
Bonds, Fiscal 1999 Series B, 4.750%, 11/01/23
8,400,000 Dormitory Authority of the State of New York, Beth Israel Medical 11/00 at 102 AAA 9,102,828
Center Revenue Bonds, Series 1996, 6.000%, 11/01/15
8,000,000 Dormitory Authority of the State of New York, Mental Health Services 2/07 at 102 A- 8,277,920
Facilities Improvement Revenue Bonds, Series 1997B, 5.500%, 8/15/17
New York State Housing Finance Agency, Health Facilities Revenue
Bonds (New York City), 1990 Series A Refunding:
16,160,000 8.000%, 11/01/08 (Pre-refunded to 11/01/00) 11/00 at 102 AAA 17,541,034
3,330,000 8.000%, 11/01/08 11/00 at 102 BBB+ 3,544,485
8,000,000 New York Local Government Assistance Corporation (A Public Benefit 4/02 at 102 AAA 8,892,480
Corporation of the State of New York), Series 1991D Bonds, 7.000%,
4/01/18 (Pre-refunded to 4/01/02)
11,490,000 State of New York Mortgage Agency, Mortgage Revenue Bonds, Eighth 10/99 at 100 Aaa 11,774,378
Series A, 6.875%, 4/01/17
</TABLE>
13
<PAGE>
Portfolio of Investments
Nuveen Municipal Bond Fund (continued)
April 30, 1999
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
New York (continued)
$ 17,270,000 Power Authority of the State of New York, General Purpose Bonds, 1/03 at 102 Aaa $ 18,484,772
Series CC, 5.250%, 1/01/18 (Pre-refunded to 1/01/03)
5,000,000 Triborough Bridge and Tunnel Authority (New York), General Purpose 1/04 at 100 Aa3 4,739,350
Revenue Bonds, Series 1994A, 4.750%, 1/01/19
- ------------------------------------------------------------------------------------------------------------------------------------
North Carolina - 3.2%
16,750,000 North Carolina Eastern Municipal Power Agency, Power System Revenue 7/99 at 100 Baa1 16,775,293
Bonds, Refunding Series 1989 A, 6.500%, 1/01/24
68,450,000 North Carolina Eastern Municipal Power Agency, Power System Revenue 1/03 at 102 Baa1 72,268,825
Bonds, Refunding Series 1993 B, 6.250%, 1/01/12
4,750,000 North Carolina Medical Care Commission, Hospital Revenue Refunding Bonds 10/03 at 102 AA 4,830,608
(Presbyterian Health Services Corp. Project), Series 1993,
5.500%, 10/01/20
1,195,000 Housing Authority of the City of Wilmington, North Carolina, First No Opt. Call N/R*** 1,253,424
Mortgage Revenue Bonds, Series 1979, 7.750%, 6/01/10
- ------------------------------------------------------------------------------------------------------------------------------------
Oklahoma - 0.3%
5,375,000 The Comanche County Hospital Authority (Lawton, Oklahoma), Hospital 7/99 at 102 AAA 5,524,371
Revenue Bonds, Series 1989, 8.050%, 7/01/16 (Pre-refunded to 7/01/99)
2,970,000 Midwest City Memorial Hospital Authority (Midwest City, Oklahoma), 4/02 at 102 BBB+*** 3,314,312
Hospital Revenue Bonds, Series 1992, 7.375%, 4/01/12 (Pre-refunded to
4/01/02)
- ------------------------------------------------------------------------------------------------------------------------------------
Oregon - 0.4%
10,000,000 State of Oregon, Department of Administrative Services, Certificates of 5/07 at 101 AAA 11,182,200
Participation, 1997 Series A, 5.800%, 5/01/24 (Pre-refunded to 5/01/07)
- ------------------------------------------------------------------------------------------------------------------------------------
Pennsylvania - 2.7%
10,000,000 Lehigh County Industrial Development Authority, Pollution Control Revenue 9/04 at 102 AAA 11,183,600
Refunding Bonds, 1994 Series B (Pennsylvania Power and Light Company
Project), 6.400%, 9/01/29
22,500,000 Pennsylvania Housing Finance Agency, Rental Housing Refunding Bonds, 7/03 at 102 AAA 23,420,925
Issue 1993, 5.750%, 7/01/14
Pennsylvania Housing Finance Agency, Multifamily Housing Refunding Bonds
(Federal Housing Administration Insured Mortgage Loans), Issue FHA-1992:
4,025,000 8.100%, 7/01/13 7/02 at 102 AAA 4,444,969
16,830,000 8.200%, 7/01/24 7/02 at 102 AAA 18,634,681
16,600,000 Pennsylvania Intergovernmental Cooperation Authority, Special Tax Revenue 6/03 at 100 AAA 16,187,988
Refunding Bonds (City of Philadelphia Funding Program), Series of
1993A, 5.000%, 6/15/22
7,000,000 City of Philadelphia, Pennsylvania, Water and Sewer Revenue Bonds, 8/01 at 100 AAA 7,517,160
Sixteenth Series, 7.000%, 8/01/18 (Pre-refunded to 8/01/01)
- ------------------------------------------------------------------------------------------------------------------------------------
Rhode Island - 0.3%
8,095,000 Rhode Island Convention Center Authority, Refunding Revenue Bonds, 1993 5/03 at 100 AAA 7,874,007
Series B, 5.000%, 5/15/20
- ------------------------------------------------------------------------------------------------------------------------------------
Texas - 5.1%
3,470,000 City of Austin, Texas, Combined Utility Systems Revenue Refunding Bonds, 11/04 at 100 AAA 3,665,777
Series 1994, 5.750%, 5/15/24
City of Austin, Texas, Water, Sewer and Electric Refunding Revenue Bonds,
Series 1982:
135,000 14.000%, 11/15/01 (Pre-refunded to 5/15/99) 5/99 at 100 A2*** 146,414
105,000 14.000%, 11/15/01 5/00 at 100 A*** 125,182
14,295,000 14.000%, 11/15/01 No Opt. Call A 16,209,386
29,500,000 Brazos River Authority, Texas, Collateralized Revenue Refunding Bonds 8/00 at 102 AAA 30,809,505
(Houston Lighting and Power Company Project), Series 1995,
5.800%, 8/01/15
6,585,000 Crowley Independent School District, Tarrant and Johnson Counties, 8/08 at 100 AAA 7,531,989
Unlimited Tax School Building Bonds, Series 1997, 6.500%, 8/01/23
</TABLE>
14
<PAGE>
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Texas (continued)
Grapevine-Colleyville Independent School District (Tarrant and Dallas
Counties, Texas), Unlimited Tax School Building and Refunding Bonds,
Series 1998:
$ 4,890,000 0.000%, 8/15/19 No Opt. Call AAA $ 1,722,062
10,000,000 0.000%, 8/15/24 No Opt. Call AAA 2,672,500
25,900,000 Harris County, Texas, Toll Road Senior Lien Revenue Refunding Bonds, 8/04 at 102 AAA 27,047,888
Series 1994, 5.300%, 8/15/13
7,000,000 Harris County Health Facilities Development Corporation, Texas, No Opt. Call AAA 7,523,460
Hospital Revenue Bonds (St. Luke's Episcopal Hospital Project),
Series 1991A, 6.750%, 2/15/21
53,280,000 City of San Antonio, Texas, Electric and Gas Systems Revenue 2/02 at 101 Aa1 52,935,278
Refunding Bonds, New Series 1992,
5.000%, 2/01/17
- ------------------------------------------------------------------------------------------------------------------------------------
Utah - 3.5%
Intermountain Power Agency (Utah), Power Supply Revenue Refunding Bonds,
1993 Series A:
7,300,000 5.500%, 7/01/13 7/03 at 102 A+ 7,571,560
27,805,000 5.500%, 7/01/20 7/03 at 102 A+ 28,422,271
53,085,000 5.000%, 7/01/23 7/03 at 100 A+ 50,960,007
15,100,000 Intermountain Power Agency (Utah), Power Supply Revenue Refunding 7/07 at 102 AAA 16,148,393
Bonds, 1997 Series B, 5.750%, 7/01/19
1,355,000 Layton (Utah), Industrial Development Revenue Bonds (C.D.I. Ltd. 6/99 at 100 N/R 1,358,469
Project-K Mart Guaranteed), 8.750%, 6/01/05
- ------------------------------------------------------------------------------------------------------------------------------------
Vermont - 0.0%
190,000 University of Vermont and State Agricultural College, Housing, 7/99 at 100 A+ 190,849
Dining and Student Services Facilities System Bonds, Lot 1 Series
1969-A, 6.300%, 7/01/06
- ------------------------------------------------------------------------------------------------------------------------------------
Virginia - 3.4%
7,750,000 Richmond Metropolitan Authority (Virginia), Expressway Revenue and 7/02 at 102 AAA 8,417,120
Refunding Bonds, Series 1992-B, 6.250%, 7/15/22
39,630,000 Virginia Housing Development Authority, Commonwealth Mortgage Bonds, 1/02 at 102 AA+ 41,454,962
1992 Series A, 7.150%, 1/01/33
3,070,000 Virginia Housing Development Authority, Multifamily Mortgage Bonds, 5/99 at 101 AA+ 3,181,288
1978 Series B, 6.700%, 11/01/21
Virginia Housing Development Authority, Multifamily Housing Bonds,
1993 Series C:
19,080,000 5.550%, 5/01/08 5/03 at 102 AA+ 19,848,924
28,075,000 5.900%, 5/01/14 5/03 at 102 AA+ 29,489,980
- ------------------------------------------------------------------------------------------------------------------------------------
Washington - 6.1%
6,045,000 Public Utility District No. 1 of Chelan County, Rocky Reach 7/99 at 100 AA 6,045,242
Hydro-Electric System Revenue Bonds, Series of 1968, 5.125%, 7/01/23
13,890,000 Public Utility District No. 1 of Douglas County, Washington, Wells 9/99 at 100 1/2 A+ 13,207,445
Hydroelectric Revenue Bonds, Series of 1963, 4.000%, 9/01/18
7,250,000 Municipality of Metropolitan Seattle, Sewer Refunding Revenue Bonds, 1/03 at 102 AAA 7,746,698
Series Y, 5.700%, 1/01/12
5,000,000 Washington Public Power Supply System, Nuclear Project No. 1 No Opt. Call Aa1 6,250,250
Refunding Revenue Bonds, Series 1989B, 7.125%, 7/01/16
Washington Public Power Supply System, Nuclear Project No. 1
Refunding Revenue Bonds, Series 1993A:
14,260,000 7.000%, 7/01/07 No Opt. Call Aa1 16,721,276
18,500,000 5.750%, 7/01/13 7/03 at 102 Aa1 19,730,990
10,000,000 5.700%, 7/01/17 7/03 at 102 AAA 10,415,900
7,805,000 Washington Public Power Supply System, Nuclear Project No. 1 No Opt. Call Aa1 9,294,662
Refunding Revenue Bonds, Series 1993B, 7.000%, 7/01/09
10,000,000 Washington Public Power Supply System, Nuclear Project No. 1 7/03 at 102 Aa1 10,220,200
Refunding Revenue Bonds, Series 1993C, 5.375%, 7/01/15
8,835,000 Washington Public Power Supply System, Nuclear Project No. 3 7/03 at 102 Aa1 9,173,911
Refunding Revenue Bonds, Series 1993B, 5.700%, 7/01/18
</TABLE>
15
<PAGE>
Portfolio of Investments
Nuveen Municipal Bond Fund (continued)
April 30, 1999
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Washington (continued)
Washington Public Power Supply System, Nuclear Project No. 3
Refunding Revenue Bonds, Series 1993C:
$ 9,180,000 5.300%, 7/01/10 7/03 at 102 Aa1 $ 9,483,766
51,070,000 5.375%, 7/01/15 7/03 at 102 Aa1 52,194,561
11,545,000 5.500%, 7/01/18 7/03 at 102 Aa1 11,788,946
- -----------------------------------------------------------------------------------------------------------------------------------
Wisconsin - 4.4%
4,355,000 Wisconsin Housing and Economic Development Authority, Insured No Opt. Call AA*** 4,699,785
Mortgage Revenue Refunding Bonds, 1977 Series A, 5.800%, 6/01/17
8,500,000 Wisconsin Housing and Economic Development Authority, Multifamily 4/02 at 102 AA- 9,167,590
Housing Revenue Bonds, 1992 Series B, 7.050%, 11/01/22
28,200,000 Wisconsin Housing and Economic Development Authority, Housing 12/03 at 102 AA- 29,483,382
Revenue Bonds, 1993 Series C, 5.800%, 11/01/13
13,700,000 Wisconsin Health and Educational Facilities Authority, Revenue 11/01 at 102 AAA 14,667,494
Bonds, Series 1991 (Columbia Hospital, Inc.), 6.250%, 11/15/21
9,830,000 Wisconsin Health and Educational Facilities Authority, Health 6/02 at 102 AAA 10,608,339
Facilities Refunding Revenue Bonds (SSM Health Care), Series 1992AA,
6.250%, 6/01/20
3,950,000 Wisconsin Health and Educational Facilities Authority, Revenue 10/04 at 102 AAA 4,289,462
Bonds, Series 1994A (Froedtert Memorial Lutheran Hospital, Inc.),
5.875%, 10/01/13
6,000,000 Wisconsin Health and Educational Facilities Authority, Revenue 12/02 at 102 AAA 6,479,039
Bonds, Series 1992A (Meriter Hospital, Inc.), 6.000%, 12/01/22
18,500,000 Wisconsin Health and Educational Facilities Authority, Revenue Bonds, 8/03 at 102 AAA 18,260,979
Series 1993 (Aurora Health Care Obligated Group), 5.250%, 8/15/23
32,000,000 Wisconsin Health and Educational Facilities Authority, Revenue Bonds, 5/06 at 102 AAA 33,692,160
Series 1996 (Aurora Medical Group, Inc. Project), 5.750%, 11/15/25
- -----------------------------------------------------------------------------------------------------------------------------------
$2,872,185,000 Total Investments - (cost $2,659,153,911) - 98.2% 2,919,418,804
==============---------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 1.8% 52,291,278
----------------------------------------------------------------------------------------------------------------
Net Assets - 100% $2,971,710,082
================================================================================================================
</TABLE>
* Optional Call Provisions (not covered by the report of independent public
accountants): Dates (month and year) and prices of the earliest optional
call or redemption. There may be other call provisions at varying prices at
later dates.
** Ratings (not covered by the report of independent public accountants):
Using the higher of Standard & Poor's or Moody's rating.
*** Securities are backed by an escrow or trust containing sufficient U.S.
government or U.S. government agency securities which ensures the timely
payment of principal and interest. Securities are normally considered to be
equivalent to AAA rated securities.
N/R Investment is not rated.
See accompanying notes to financial statements
- ----
16
<PAGE>
Portfolio of Investments
Nuveen Insured Municipal Bond Fund
April 30, 1999
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Alabama - 7.5%
$ 5,600,000 The Alabama Public Health Care Authority, Mortgage Revenue Bonds, Series 4/06 at 102 AAA $ 6,035,960
1996, 6.000%, 10/01/25
2,120,000 The Water Supply Board of the City of Albertville (Alabama), Water 3/02 at 102 AAA 2,313,196
Revenue Bonds, Series 1992, 6.700%, 3/01/11
3,500,000 City of Athens (Alabama), Electric Revenue Warrants, Series 1995, 6/05 at 102 AAA 3,797,815
6.000%, 6/01/25
4,205,000 The Governmental Utility Services Corporation of the City of Auburn, 12/99 at 102 AAA 4,396,916
Floating/Fixed Rate Wastewater Treatment Revenue Bonds, Series 1984
(Merscot-Auburn Limited Partnership Project), 7.300%, 1/01/12
1,875,000 The Special Care Facilities Financing Authority of the City of Birmingham 1/01 at 102 AAA 1,952,719
(Alabama), Revenue Bonds, Series 1991-A (The Baptist Medical Centers),
7.000%, 1/01/21
1,225,000 The Utilities Board of the City of Daphne (Alabama), Water, Gas and Sewer 6/00 at 102 AAA 1,297,643
Revenue Refunding Bonds, Series 1990B, 7.350%, 6/01/20
6,750,000 The Public Building Authority of the City of Huntsville (Alabama), 10/05 at 102 AAA 7,345,080
Municipal Justice and Public Safety Center Lease Revenue Bonds, Series
1996A, 6.000%, 10/01/25
3,000,000 City of Madison (Alabama), General Obligation School Warrants, Series 2/04 at 102 AAA 3,354,960
1994, 6.250%, 2/01/19
5,500,000 City of Madison (Alabama), General Obligation Warrants, Series 1995, 4/05 at 102 AAA 5,959,470
6.000%, 4/01/23
5,580,000 Baptist Medical Center Special Care Facilities Financing Authority of the 9/07 at 102 AAA 5,672,516
City of Montgomery, Revenue Bonds, Series 1997-C (Baptist Medical
Center), 5.375%, 9/01/22
12,000,000 The Medical Clinic Board of the City of Montgomery (Alabama), Health Care 3/06 at 102 AAA 12,926,760
Facility Revenue Bonds, Jackson Hospital and Clinic, Series 1996,
6.000%, 3/01/26
The Utilities Board of the City of Oneonta (Alabama), Utility Revenue
Bonds, Series 1994:
2,860,000 6.900%, 11/01/24 (Pre-refunded to 11/01/04) 11/04 at 102 AAA 3,329,812
140,000 6.900%, 11/01/24 11/04 at 102 AAA 160,740
West Morgan-East Lawrence Water Authority, Water Revenue Bonds, Series
1994:
2,200,000 6.800%, 8/15/19 (Pre-refunded to 8/15/04) 8/04 at 102 AAA 2,539,812
3,000,000 6.850%, 8/15/25 (Pre-refunded to 8/15/04) 8/04 at 102 AAA 3,470,490
- ------------------------------------------------------------------------------------------------------------------------------------
Alaska - 2.7%
Alaska Industrial Development and Export Authority, Revolving Fund Bonds,
Series 1997A:
4,500,000 5.900%, 4/01/17 (Alternative Minimum Tax) 4/07 at 102 AAA 4,789,935
5,000,000 6.125%, 4/01/27 (Alternative Minimum Tax) 4/07 at 102 AAA 5,460,800
6,870,000 Alaska Housing Finance Corporation, Mortgage Revenue Bonds, 1996 6/06 at 102 AAA 7,309,680
Series A, 6.000%, 12/01/15
5,000,000 Alaska Housing Finance Corporation, Mortgage Revenue Bonds, 1997 6/07 at 102 AAA 5,282,450
Series A, 6.000%, 6/01/27
- ------------------------------------------------------------------------------------------------------------------------------------
Arizona - 2.0%
5,000,000 Navajo County, Arizona, Pollution Control Corporation, Pollution Control 8/03 at 102 A- 5,116,800
Revenue Refunding Bonds (Arizona Public Service Company), 1993
Series A, 5.875%, 8/15/28
Tempe Union High School District No. 213 of Maricopa County, Arizona,
School Improvement and Refunding Bonds, Series 1994:
4,290,000 6.000%, 7/01/10 (Pre-refunded to 7/01/04) 7/04 at 101 AAA 4,744,011
1,710,000 6.000%, 7/01/10 7/04 at 101 AAA 1,872,057
5,000,000 City of Tucson, Arizona, Water System Revenue Bonds, Series 1994-A 7/06 at 101 AAA 5,620,350
(1996), 6.000%, 7/01/21 (Pre-refunded to 7/01/06)
- ------------------------------------------------------------------------------------------------------------------------------------
California - 9.4%
3,525,000 Brea Public Financing Authority (Orange County, California), 1991 Tax 8/01 at 102 AAA 3,861,038
Allocation Revenue Bonds, Series A (Redevelopment Project AB),
7.000%, 8/01/15 (Pre-refunded to 8/01/01)
</TABLE>
17
<PAGE>
Portfolio of Investments
Nuveen Insured Municipal Bond Fund (continued)
April 30, 1999
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
California (continued)
$ 5,000,000 California Health Facilities Financing Authority, Insured Health Facility 7/06 at 102 AAA $ 5,429,550
Refunding Revenue Bonds (Catholic Healthcare West), 1996 Series A,
6.000%, 7/01/25
27,860,000 California Housing Finance Agency, Home Mortgage Revenue Bonds, 1999 No Opt. Call AAA 5,288,664
Series B, 0.000%, 2/01/30 (Alternative Minimum Tax)
10,000,000 California Statewide Communities Development Authority, Certificates of 4/08 at 101 AAA 10,024,500
Participation, Citrus Valley Health Partners, Inc., 5.125%, 4/01/23
995,000 M-S-R Public Power Agency (California), San Juan Project Refunding 7/99 at 100 AAA 997,239
Revenue Bonds, Series H, 5.900%, 7/01/20
13,750,000 Ontario Redevelopment Financing Authority (San Bernardino County, 8/03 at 102 AAA 14,953,538
California), 1993 Revenue Bonds (Ontario Redevelopment Project No. 1),
5.800%, 8/01/23
5,295,000 County of Riverside (California) (1994 Desert Justice Facility Project), 12/04 at 101 AAA 5,934,689
Certificates of Participation, 6.000%, 12/01/12 (Pre-refunded to
12/01/04)
2,250,000 Sacramento Municipal Utility District (California), Electric Revenue 9/01 at 102 AAA 2,445,502
Bonds, 1991 Series Y, 6.500%, 9/01/21 (Pre-refunded to 9/01/01)
17,355,000 County of San Bernardino (California), Single Family Home Mortgage 5/07 at 28 1/16 AAA 3,153,924
Revenue Bonds, (Mortgage-Backed Securities Program), 1997 Series A,
0.000%, 5/01/31 (Alternative Minimum Tax)
17,500,000 San Joaquin Hills Transportation Corridor Agency, Toll Road Refunding 1/07 at 102 AAA 17,757,950
Revenue Bonds, Series 1997A, 5.250%, 1/15/30
10,000,000 The Regents of the University of California, Revenue Bonds (Multiple 9/02 at 102 AAA 11,073,700
Purpose Projects), Series D, 6.375%, 9/01/24 (Pre-refunded to 9/01/02)
- ------------------------------------------------------------------------------------------------------------------------------------
Colorado--1.0%
Board of Water Commissioners, City and County of Denver, Colorado,
Certificates of Participation, Series 1991:
2,675,000 6.625%, 11/15/11 (Pre-refunded to 11/15/01) 11/01 at 101 AAA 2,895,928
1,825,000 6.625%, 11/15/11 11/01 at 101 AAA 1,959,813
3,500,000 Jefferson County, Colorado, Refunding Certificates of Participation, 12/02 at 102 AAA 3,889,970
6.650%, 12/01/08
- ------------------------------------------------------------------------------------------------------------------------------------
Delaware--0.5%
3,600,000 Delaware Economic Development Authority, Pollution Control Refunding 5/02 at 102 AAA 3,930,156
Revenue Bonds (Delmarva Power and Light Company Project), Series 1992B,
6.750%, 5/01/19
- ------------------------------------------------------------------------------------------------------------------------------------
District of Columbia--2.7%
6,000,000 District of Columbia (Washington, D.C.), General Obligation Bonds, Series 6/04 at 102 AAA 6,679,919
1994B, 6.100%, 6/01/11 (Pre-refunded to 6/01/04)
17,000,000 Washington Convention Center Authority (Washington, D.C.), Senior Lien 10/08 at 101 AAA 16,541,339
Dedicated Tax Revenue Bonds, Series 1998, 5.000%, 10/01/21
- ------------------------------------------------------------------------------------------------------------------------------------
Florida--0.1%
920,000 Florida Keys Aqueduct Authority, Water Revenue Refunding Bonds, Series 9/01 at 101 AAA 994,400
1991, 6.750%, 9/01/21 (Pre-refunded to 9/01/01)
80,000 Florida Keys Aqueduct Authority, Water Revenue Bonds, Series 1991, 9/01 at 101 AAA 85,896
6.750%, 9/01/21
- ------------------------------------------------------------------------------------------------------------------------------------
Georgia--3.3%
5,000,000 City of Albany (Georgia), Sewage System Revenue Bonds, Series 1992, 7/02 at 102 AAA 5,534,250
6.625%, 7/01/17 (Pre-refunded to 7/01/02)
5,000,000 Development Authority of Appling County (Georgia), Pollution Control 1/04 at 101 AAA 5,618,450
Revenue Bonds (Oglethorpe Power Corporation--Hatch Project), Series
1994, 7.150%, 1/01/21
5,000,000 Development Authority of Burke County (Georgia), Pollution Control 5/04 at 102 AAA 4,988,050
Revenue Bonds (Georgia Power Company--Vogtle Plant Project), Third
Series 1999, 5.250%, 5/01/34 (WI)
2,250,000 Chatham County Hospital Authority, Hospital Revenue Bonds (Memorial 1/01 at 102 AAA 2,416,073
Medical Center, Inc.) (Savannah, Georgia), Series 1990A,
7.000%, 1/01/21 (Pre-refunded to 1/01/01)
3,020,000 Development Authority of the City of Marietta, First Mortgage Revenue 9/05 at 102 AAA 3,265,586
Bonds (Life College, Inc.), Series 1995A and Series 1995B,
5.950%, 9/01/19
</TABLE>
18
<PAGE>
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<C> <S> <C> <C> <C>
Georgia (continued)
$ 6,180,000 Marietta Development Authority (Life College), 6.250%, 9/01/25 9/05 at 102 AAA $ 6,908,684
- ------------------------------------------------------------------------------------------------------------------------------------
Illinois--15.2%
2,500,000 City of Chicago, Illinois, General Obligation Adjustable Rate 7/02 at 101 1/2 AAA 2,771,850
Bonds, Central Public Library Project, Series C of 1988,
6.850%, 1/01/17 (Pre-refunded to 7/01/02)
5,000,000 City of Chicago, General Obligation Bonds, Series A of 1992, 1/02 at 102 AAA 5,397,650
6.250%, 1/01/12 (Pre-refunded to 1/01/02)
Chicago School Reform Board of Trustees of the Board of
Education of the City of Chicago, Illinois, Unlimited Tax
General Obligation Bonds (Dedicated Tax Revenues), Series 1997:
9,590,000 5.800%, 12/01/17 12/07 at 102 AAA 10,314,716
10,000,000 5.750%, 12/01/27 12/07 at 102 AAA 10,665,300
10,000,000 Chicago School Reform Board of Trustees of the Board of 12/07 at 102 AAA 9,976,500
Education of the City of Chicago, Illinois, Unlimited Tax
General Obligation Bonds (Dedicated Tax Revenues),
Series 1997A, 5.250%, 12/01/30
12,800,000 Public Building Commission of Chicago, Illinois, Building 12/03 at 102 AAA 14,083,200
Revenue Bonds, Series A of 1993 (Board of Education of the
City of Chicago), 5.750%, 12/01/18 (Pre-refunded to 12/01/03)
6,540,000 Town of Cicero, Cook County, Illinois, General Obligation 12/04 at 102 AAA 7,323,623
Corporate Purpose Bonds, Series 1994A, 6.400%, 12/01/14
7,500,000 The County of Cook, Illinois, General Obligation Bonds, 11/03 at 100 AAA 7,227,750
Series 1993A, 5.000%, 11/15/23
2,500,000 Community College District No. 508, Cook County, Illinois, No Opt. Call AAA 3,197,425
Certificates of Participation, 8.750%, 1/01/07
2,370,000 Board of Governors of State Colleges and Universities, 4/04 at 102 AAA 2,669,947
Illinois, Eastern Illinois University, Auxiliary Facilities
System Revenue Bonds, Series 1994A, 6.375%, 4/01/16
(Pre-refunded to 4/01/04)
Illinois Educational Facilities Authority, Revenue Refunding
Bonds (Midwestern University), Series 1966B:
1,455,000 6.250%, 5/15/26 (Pre-refunded to 5/15/06) 5/06 at 102 AAA 1,666,979
445,000 6.250%, 5/15/26 5/06 at 102 AAA 493,060
4,500,000 Illinois Health Facilities Authority, Revenue Bonds, 5/04 at 102 AAA 4,958,910
Series 1994 (Ingalls Health System Project), 6.250%, 5/15/24
3,000,000 Illinois Health Facilities Authority, Revenue Bonds, 8/04 at 102 AAA 3,365,850
Series 1994A (The University of Chicago Hospitals Project),
6.125%, 8/15/24 (Pre-refunded to 8/15/04)
4,000,000 Illinois Health Facilities Authority, Health Care Facilities 11/04 at 102 AAA 4,570,760
Revenue Bonds, Series 1995 (Northwestern Medical Faculty
Foundation, Inc.), 6.500%, 11/15/15
(Pre-refunded to 11/15/04)
7,000,000 Illinois Health Facilities Authority, Revenue Bonds (Carle 1/06 at 102 AAA 7,484,470
Foundation), Series 1996, 6.000%, 1/01/27
169,000 Illinois Health Facilities Authority, Revenue Bonds (Community No Opt. Call AAA 192,139
Provider Pooled Loan Program), 7.900%, 8/15/03
952,000 Illinois Health Facilities Authority, Revenue Bonds, 8/99 at 100 AAA 964,167
Series 1988-B (Community Provider Pooled Loan Program),
7.900%, 8/15/03
10,000,000 Illinois Housing Development Authority, Homeowner Mortgage 8/08 at 101 AAA 9,894,400
Revenue Bonds, 1998 Subseries G-2, 5.250%, 8/01/29
(Alternative Minimum Tax)
5,000,000 State of Illinois, General Obligation Bonds, 8/04 at 102 AA 5,427,850
Series of August 1994, 5.875%, 8/01/19
State of Illinois, General Obligation Bonds, Series of
February 1995:
3,065,000 6.100%, 2/01/19 2/05 at 102 AAA 3,349,340
5,545,000 6.100%, 2/01/20 2/05 at 102 AAA 6,059,410
8,790,000 Community Unit School District Number 60 (Waukegan), Lake No Opt. Call AAA 3,197,714
County, Illinois, General Obligation School Bonds,
Series 1999A & B, 0.000%, 12/01/18
4,000,000 Regional Transportation Authority, Cook, DuPage, Kane, Lake, 6/03 at 102 AAA 4,384,880
McHenry and Will Counties, Illinois, General Obligation
Refunding Bonds, Series 1993C, 5.850%, 6/01/23
(Pre-refunded to 6/01/03)
- ------------------------------------------------------------------------------------------------------------------------------------
Indiana--6.7%
5,000,000 Indiana Health Facility Financing Authority, Hospital Revenue 5/02 at 102 AAA 5,398,200
Refunding and Improvement Bonds, Series 1992 (Community
Hospitals Projects), 6.400%, 5/01/12
5,000,000 Indiana Municipal Power Agency, Power Supply System Revenue 1/03 at 102 AAA 5,417,700
Bonds, 1993 Series A, 6.125%, 1/01/19
</TABLE>
19
<PAGE>
Portfolio of Investments
Nuveen Insured Municipal Bond Fund (continued)
April 30, 1999
<TABLE>
CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Indiana (continued)
Indiana Housing Finance Authority, Single Family Mortgage
Revenue Bonds, 1997 Series B-2:
$ 1,755,000 6.000%, 7/01/16 (Alternative Minimum Tax) 1/07 at 101 1/2 Aaa $ 1,845,505
10,620,000 6.125%, 1/01/27 (Alternative Minimum Tax) 1/07 at 101 1/2 Aaa 11,184,984
3,750,000 City of Indianapolis, Indiana, Gas Utility System Revenue Bonds, 6/02 at 102 AAA 4,093,050
Series 1992 A, 6.200%, 6/01/23
(Pre-refunded to 6/01/02)
4,950,000 Jasper County, Indiana, Collateralized Pollution Control 7/01 at 102 AAA 5,354,712
Refunding Revenue Bonds (Northern Indiana Public Service Company
Project), Series 1991, 7.100%, 7/01/17
2,000,000 Lawrence Central High School Building Corporation, Marion County, 7/00 at 102 AAA 2,125,520
Indiana, First Mortgage Bonds, Series 1990, 7.250%, 7/01/08
(Pre-refunded to 7/01/00)
3,300,000 Marion County Convention and Recreational Facilities Authority, 6/01 at 102 AAA 3,586,407
Indiana, Excise Taxes Lease Rental Revenue Bonds, Series 1991B,
7.000%, 6/01/21 (Pre-refunded to 6/01/01)
11,300,000 Marion County Convention and Recreational Facilities Authority, 6/08 at 101 AAA 10,846,870
Indiana, Excise Taxes Lease Rental Revenue Subordinate Bonds,
Series 1997A, 5.000%, 6/01/27
1,000,000 City of Princeton, Indiana, Pollution Control Refunding Revenue Bonds, 3/00 at 102 AAA 1,051,590
1990 Series (Public Service Company of Indiana, Inc. - Project C),
7.375%, 3/15/12
2,000,000 Hospital Authority of St. Joseph County, Indiana, Fixed Rate Hospital 8/01 at 102 AAA 2,184,320
Revenue Refunding Bonds, Series 1991A (Memorial Hospital of
South Bend Project), 7.000%, 8/15/20 (Pre-refunded to 8/15/01)
2,190,000 Shelby County Jail Building Corporation, First Mortgage Bonds, 7/02 at 102 AAA 2,415,855
Shelby County, Indiana, 6.500%, 7/15/09 (Pre-refunded to 7/15/02)
2,265,000 Southwest Allen Multi-School Building Corporation, First Mortgage 1/02 at 101 AAA 2,427,514
Refunding Bonds, Series 1992B, Ft. Wayne, Indiana, 6.375%, 1/15/09
- ------------------------------------------------------------------------------------------------------------------------------------
Louisiana - 2.4%
7,000,000 Louisiana Public Facilities Authority, Hospital Revenue Refunding Bonds 5/02 at 102 AAA 7,755,720
(Southern Baptist Hospital Project), Series 1992, 6.800%, 5/15/12
(Pre-refunded to 5/15/02)
State of Louisiana, General Obligation Bonds, Series 1992-A:
5,000,000 6.500%, 5/01/09 5/02 at 102 AAA 5,492,250
2,000,000 6.500%, 5/01/12 (Pre-refunded to 5/01/02) 5/02 at 102 AAA 2,196,900
4,750,000 Hospital Service District No. 1 of the Parish of Tangipahoa, 2/04 at 102 AAA 5,224,810
State of Louisiana, Hospital Revenue Bonds (Series 1994),
6.250%, 2/01/24
- ------------------------------------------------------------------------------------------------------------------------------------
Maine - 3.4%
11,500,000 Maine Health and Higher Educational Facilities Authority, 7/05 at 102 AAA 12,418,505
Revenue Bonds, Series 1995A, 5.875%, 7/01/25
Maine Health and Higher Educational Facilities Authority, Revenue
Bonds, Series 1994B:
3,110,000 7.000%, 7/01/24 (Pre-refunded to 7/01/04) 7/04 at 102 AAA 3,612,110
65,000 7.000%, 7/01/24 7/04 at 102 AAA 74,307
11,090,000 Maine State Housing Authority, Mortgage Purchase Bonds, 5/06 at 102 AAA 11,964,114
1996 Series B-2, 6.450%, 11/15/26
(Alternative Minimum Tax)
Town of Old Orchard Beach, Maine, 1992 General Obligation Bonds:
750,000 6.650%, 9/01/09 (Pre-refunded to 9/01/02) 9/02 at 103 AAA 840,600
500,000 6.650%, 9/01/10 (Pre-refunded to 9/01/02) 9/02 at 103 AAA 560,400
- ------------------------------------------------------------------------------------------------------------------------------------
Massachusetts - 3.4%
3,500,000 City of Boston, Massachusetts, Revenue Bonds, Boston City Hospital 8/00 at 102 Aaa 3,751,755
(FHA-Insured Mortgage), Series A, 7.625%, 2/15/21
(Pre-refunded to 8/15/00)
1,150,000 City of Haverhill, Massachusetts, General Obligation Municipal Purpose 6/02 at 102 AAA 1,284,550
Loan of 1992, Series A, 7.000%, 6/15/12 (Pre-refunded to 6/15/02)
1,250,000 Massachusetts Bay Transportation Authority, Certificates of 8/00 at 102 AAA 1,338,963
Participation, 1990 Series A, 7.650%, 8/01/15
(Pre-refunded to 8/01/00)
3,400,000 Massachusetts Health and Educational Facilities Authority, 7/02 at 102 AAA 3,717,084
Revenue Bonds, New England Medical Center Hospitals Issue,
Series F, 6.625%, 7/01/25
4,000,000 Massachusetts Health and Educational Facilities Authority, 7/02 at 102 AAA 4,358,320
Revenue Bonds, South Shore Hospital Issue, Series D,
6.500%, 7/01/22
</TABLE>
20
<PAGE>
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Massachusetts (continued)
$5,875,000 Massachusetts Health and Educational Facilities Authority, Revenue Bonds, 11/03 at 102 AAA $ 5,825,004
Cape Cod Health Systems, Inc. Issue, Series A, 5.250%, 11/15/21
4,000,000 Massachusetts Health and Educational Facilities Authority, Revenue Bonds, 10/05 at 102 AAA 4,329,400
Berkshire Health Systems Issue, Series D, 6.000%, 10/01/19
5,225,000 Massachusetts Turnpike Authority, Metropolitan Highway System Revenue 1/09 at 101 AAA 4,986,740
Bonds, 1999 Series A (Subordinated), 5.000%, 1/01/39
- -----------------------------------------------------------------------------------------------------------------------------------
Michigan - 4.3%
12,130,000 City of Bay City, County of Bay, State of Michigan, 1991 General No Opt. Call AAA 3,866,680
Obligation Unlimited Tax Street Improvement Bonds, 0.000%, 6/01/21
5,000,000 Caledonia Community Schools, Counties of Kent, Allegan and Barry, 5/02 at 102 AAA 5,522,000
State of Michigan, 1992 School Building and Site and Refunding Bonds
(General Obligation - Unlimited Tax), 6.700%, 5/01/22
(Pre-refunded to 5/01/02)
2,500,000 Chelsea School District, Counties of Washtenaw and Jackson, State of 5/05 at 101 AAA 2,784,900
Michigan, 1995 School Building and Site Bonds (General Obligation -
Unlimited Tax), 6.000%, 5/01/19
2,000,000 City of Detroit, Michigan, Sewage Disposal System Revenue Bonds, 7/01 at 102 AAA 2,162,280
Series 1991, 6.625%, 7/01/21 (Pre-refunded to 7/01/01)
1,500,000 County of Lenawee, Michigan, Hospital Finance Authority, Hospital 7/09 at 101 AAA 1,443,135
Revenue and Refunding Bonds (Lenawee Health Alliance Obligated Group),
Series 1999A, 5.000%, 7/01/28
3,500,000 Michigan State Housing Development Authority, Single Family Mortgage 11/08 at 101 AAA 3,499,825
Revenue Bonds, 1998B, 5.200%, 12/01/18 (Alternative Minimum Tax)
5,000,000 Michigan State Hospital Finance Authority, Hospital Revenue Bonds 11/06 at 102 AAA 5,355,700
(Sparrow Obligated Group), Series 1996, 5.900%, 11/15/26
8,280,000 Michigan State Housing Development Authority, Rental Housing Revenue 4/07 at 102 AAA 8,811,824
Bonds, 1997 Series A, 6.100%, 10/01/33 (Alternative Minimum Tax)
2,000,000 Michigan Strategic Fund Limited Obligation Refunding Revenue Bonds 12/01 at 102 AAA 2,173,000
(The Detroit Edison Company Pollution Control Bonds Project),
Collateralized Series 1991DD, 6.875%, 12/01/21
1,085,000 School District of the City of River Rouge, County of Wayne, State 5/03 at 101 1/2 AAA 1,130,103
of Michigan, 1993 School Building and Site Bonds
(General Obligation - Unlimited Tax), 5.625%, 5/01/22
- -----------------------------------------------------------------------------------------------------------------------------------
Mississippi - 0.8%
6,400,000 Medical Center Educational Building Corporation (Mississippi), 12/04 at 102 AAA 7,131,264
Revenue Bonds, Series 1993 (University of Mississippi Medical Center
Project), 5.900%, 12/01/23 (Pre-refunded to 12/01/04)
- -----------------------------------------------------------------------------------------------------------------------------------
Missouri - 1.0%
7,950,000 St. Louis Municipal Finance Corporation, City Justice Center, 2/06 at 102 AAA 8,632,110
Leasehold Revenue Improvement Bonds, Series 1996A (City of St. Louis,
Missouri, Lessee), 5.950%, 2/15/16
- -----------------------------------------------------------------------------------------------------------------------------------
Nebraska - 0.6%
5,000,000 Nebraska Investment Finance Authority, Health Facilities Revenue Bonds 2/08 at 102 AAA 5,199,800
(Children's Healthcare Services Obligated Group), Series 1997, 5.500%,
8/15/27
- -----------------------------------------------------------------------------------------------------------------------------------
Nevada - 0.6%
2,500,000 County of Churchill, Nevada, Health Care Facilities Revenue Bonds 1/04 at 102 AAA 2,688,550
(Western Health Network, Inc.), Series 1994A, 6.000%, 1/01/24
2,000,000 Clark County, Nevada, Industrial Development Refunding Revenue Bonds 10/02 at 102 AAA 2,230,320
(Nevada Power Company Project), Series 1992C, 7.200%, 10/01/22
- -----------------------------------------------------------------------------------------------------------------------------------
New Hampshire - 0.4%
2,850,000 New Hampshire Higher Educational and Health Facilities Authority, 7/02 at 102 AAA 3,088,745
Revenue Refunding Bonds, University System of New Hampshire Issue,
Series 1992, 6.250%, 7/01/20
- -----------------------------------------------------------------------------------------------------------------------------------
New Jersey - 0.2%
1,665,000 Housing Finance Corporation of the Township of Pennsauken (Pennsauken, 10/99 at 103 AAA 1,720,544
New Jersey), Section 8 Assisted Housing Revenue Bonds (Pennsauken
Housing Associates - 1979 Elderly Project), 8.000%, 4/01/11
</TABLE>
21
<PAGE>
Portfolo of Investments
Nuveen Insured Municipal Bond Fund (continued)
April 30, 1999
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- -----------------------------------------------------------------------------------------------------------------------------------
<C> <S> <C> <C> <C>
New Mexico - 0.9%
$3,000,000 City of Albuquerque, New Mexico, Hospital System Revenue Bonds, 8/99 at 100 AAA $ 3,023,490
1992 Series B (Presbyterian Healthcare Services), 6.600%, 8/01/07
4,445,000 City of Farmington, New Mexico, Pollution Control Revenue Refunding 12/02 at 102 AAA 4,873,943
Bonds, 1992 Series A (Public Service Company of New Mexico, San Juan
and Four Corners Projects), 6.375%, 12/15/22
- -----------------------------------------------------------------------------------------------------------------------------------
New York - 9.4%
Metropolitan Transportation Authority, Commuter Facilities Revenue Bonds,
Series 1992B:
4,955,000 6.250%, 7/01/17 (Pre-refunded to 7/01/02) 7/02 at 102 AAA 5,434,000
6,925,000 6.250%, 7/01/22 (Pre-refunded to 7/01/02) 7/02 at 102 AAA 7,594,440
5,000,000 Metropolitan Transportation Authority, Commuter Facilities Revenue Bonds, 7/04 at 101 1/2 AAA 5,651,700
Series 1994A, 6.375%, 7/01/18 (Pre-refunded to 7/01/04)
5,935,000 The City of New York, General Obligation Bonds, 8/02 at 101 1/2 AAA 6,555,445
Fiscal 1992 Series C, Fixed Rate Bonds, Subseries
C-1, 6.625%, 8/01/12 (Pre-refunded to 8/01/02)
65,000 The City of New York, General Obligation Bonds, Fiscal 1992 8/02 at 101 1/2 AAA 71,102
Series C, 6.625%, 8/01/12
3,750,000 The City of New York, General Obligation Bonds, Fiscal 1992 2/02 at 101 1/2 AAA 4,095,263
Series B, 7.000%, 2/01/18
The City of New York, General Obligation Bonds, Fiscal 1993 Series E:
2,195,000 6.000%, 5/15/16 (Pre-refunded to 5/15/03) 5/03 at 101 1/2 AAA 2,409,078
815,000 6.000%, 5/15/16 5/03 at 101 1/2 AAA 880,754
19,500,000 New York City Municipal Water Finance Authority, Water and Sewer 6/06 at 101 AAA 20,014,995
System Revenue Bonds, Series A, 5.375%, 6/15/26
New York City Municipal Water Finance Authority, Water and Sewer
System Revenue Bonds, Fiscal 1992 Series A:
3,010,000 6.750%, 6/15/16 (Pre-refunded to 6/15/01) 6/01 at 101 AAA 3,234,847
3,320,000 6.750%, 6/15/16 6/01 at 101 AAA 3,551,404
4,470,000 New York City, Municipal Water Finance Authority, Water and Sewer 6/02 at 101 1/2 AAA 4,644,777
System Revenue Bonds, Fiscal 1993 Series A, 5.750%, 6/15/18
3,900,000 New York City Transit Authority, Transit Facilities No Opt. Call AAA 4,109,508
Refunding Revenue Bonds, Series 1993 (Livingston Plaza Project),
5.400%, 1/01/18
New York City Industrial Development Agency, Civic Facility
Revenue Bonds (USTA National Tennis Center Incorporated Project):
3,500,000 6.500%, 11/15/10 11/04 at 102 AAA 3,959,130
3,000,000 6.600%, 11/15/11 11/04 at 102 AAA 3,408,270
5,240,000 Triborough Bridge and Tunnel Authority, Special Obligation Refunding 1/01 at 102 AAA 5,597,211
Bonds, Series 1991B, 6.875%, 1/01/15
- -----------------------------------------------------------------------------------------------------------------------------------
Ohio - 0.3%
2,500,000 Dublin City School District, Franklin, Delaware and Union Counties, Ohio, 12/02 at 102 AAA 2,754,950
Various Purpose School Building Construction and Improvement Bonds
(General Obligation - Unlimited Tax), 6.200%, 12/01/19
(Pre-refunded to 12/01/02)
- -----------------------------------------------------------------------------------------------------------------------------------
Oklahoma - 0.7%
140,000 Muskogee County Home Finance Authority (Oklahoma), Single 6/00 at 102 AAA 145,075
Family Mortgage Revenue Refunding Bonds,
Series 1990 A, 7.600%, 12/01/10
5,000,000 Oklahoma Industries Authority, Health System Revenue Bonds 8/05 at 102 AAA 5,586,550
(Obligated Group consisting of Baptist Medical Center of
Oklahoma, Inc., South Oklahoma City Hospital Corporation
and Baptist Rural Health System, Inc.), Fixed Rate Bonds,
6.250%, 8/15/12
- -----------------------------------------------------------------------------------------------------------------------------------
Pennsylvania - 1.0%
3,000,000 North Penn Water Authority (Montgomery County, Pennsylvania), 11/04 at 101 AAA 3,483,270
Water Revenue Bonds, Series of 1994,
7.000%, 11/01/24 (Pre-refunded to 11/01/04)
3,900,000 The Philadelphia Municipal Authority (Philadelphia, Pennsylvania), 11/01 at 102 AAA 4,305,717
Justice Lease Revenue Bonds, 1991 Series B, 7.125%,
11/15/18 (Pre-refunded to 11/15/01)
1,000,000 Washington County Hospital Authority (Pennsylvania), Hospital 7/00 at 102 AAA 1,058,490
Revenue Refunding Bonds, Series A of 1990 (The Washington Hospital
Project), 7.150%, 7/01/17
</TABLE>
22
<PAGE>
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Puerto Rico--0.5%
$ 3,750,000 Commonwealth of Puerto Rico, Public Improvement Bonds of 1992 (General 7/02 at 101 1/2 AAA $ 4,140,675
Obligation Bonds), 6.600%, 7/01/13 (Pre-refunded to 7/01/02)
- ------------------------------------------------------------------------------------------------------------------------------------
Rhode Island--2.6%
4,000,000 City of Cranston, Rhode Island, General Obligation Bonds, 7.200%, 7/15/11 7/01 at 101 1/2 AAA 4,360,800
(Pre-refunded to 7/15/01)
3,130,000 Kent County Water Authority (Rhode Island), General Revenue Bonds, 1994 7/04 at 102 AAA 3,486,601
Series A, 6.350%, 7/15/14
1,000,000 Providence Housing Development Corporation, Mortgage Revenue Refunding 7/04 at 102 AAA 1,083,560
Bonds, Series 1994A (FHA-Insured Mortgage Loan--Barbara Jordan
Apartments Project) (Providence, Rhode Island), 6.650%, 7/01/15
2,250,000 Rhode Island Depositors Economic Corporation, Special Obligation Bonds, 8/02 at 102 AAA 2,494,508
1992 Series A, 6.625%, 8/01/19 (Pre-refunded to 8/01/02)
10,000,000 Rhode Island Clean Water Finance Agency, Wastewater Treatment System 9/07 at 102 AAA 10,535,600
Revenue Bonds (City of Cranston/Triton Ocean State LLC Project), Series
1997, 5.800%, 9/01/22 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
South Carolina--3.7%
Charleston County, South Carolina, Charleston Public Facilities
Corporation, Certificates of Participation, Series 1994B:
1,430,000 6.875%, 6/01/14 (Pre-refunded to 6/01/04) 6/04 at 102 AAA 1,650,506
70,000 6.875%, 6/01/14 6/04 at 102 AAA 79,315
2,385,000 7.000%, 6/01/19 (Pre-refunded to 6/01/04) 6/04 at 102 AAA 2,766,409
115,000 7.000%, 6/01/19 6/04 at 102 AAA 130,699
5,435,000 Greenville Memorial Auditorium District Public Facilities Corporation, 3/06 at 102 AAA 6,041,763
South Carolina, Certificates of Participation (Bi-Lo Center Project),
Series 1996B, 5.750%, 3/01/22 (Pre-refunded to 3/01/06)
3,845,000 Greenville Memorial Auditorium District Public Facilities Corporation, 3/09 at 102 AAA 3,856,535
South Carolina, Refunding Certificates of Participation (Bi-Lo Center
Project), Series 1999B, 5.200%, 3/01/27
15,000,000 Orangeburg County, South Carolina, Solid Waste Disposal Facilities 11/02 at 101 AAA 15,476,850
Revenue Bond (South Carolina Electric and Gas Company Project), Series
1994, 5.700%, 11/01/24 (Alternative Minimum Tax)
2,000,000 City of Rock Hill, South Carolina, Combined Utility System Revenue Bonds, 1/01 at 102 AAA 2,119,480
Series 1991, 6.375%, 1/01/15
- ------------------------------------------------------------------------------------------------------------------------------------
Texas--7.2%
3,000,000 Bexar County, Texas, Health Facilities Development Corporation, Hospital 8/04 at 102 AAA 3,450,030
Revenue Bonds (Baptist Memorial Hospital System Project), Series 1994,
6.750%, 8/15/19 (Pre-refunded to 8/15/04)
4,575,000 Harris County, Texas, Toll Road Senior Lien, Revenue Refunding Bonds, 8/02 at 102 AAA 5,059,127
Series 1992A, 6.500%, 8/15/17 (Pre-refunded to 8/15/02)
1,000,000 Harris County Hospital District Refunding Revenue Bonds, Texas, Series No Opt. Call AAA 1,200,600
1990, 7.400%, 2/15/10
500,000 City of Houston, Texas, Senior Lien Hotel Occupancy Tax and Parking 7/01 at 100 AAA 535,625
Facilities, Weekly Adjustable/Fixed Rate Revenue Bonds, Series 1985,
Custodial Receipts, Series A, 7.000%, 7/01/15 (Pre-refunded to 7/01/01)
825,000 Lower Colorado River Authority, Priority Refunding Revenue Bonds, Series 1/01 at 102 AAA 881,917
1991 B, 7.000%, 1/01/11
Retama Development Corporation, Special Facilities Revenue Bonds (Retama
Park Racetrack Project), Series 1993:
9,715,000 8.750%, 12/15/18 No Opt. Call AAA 14,280,273
5,405,000 10.000%, 12/15/20 No Opt. Call AAA 8,895,387
5,000,000 Tarrant County Health Facilities Development Corporation, Hospital No Opt. Call AAA 5,609,250
Revenue Refunding and Improvement Bonds (Fort Worth Osteopathic
Hospital, Inc. Project), Series 1993, 6.000%, 5/15/21
6,080,000 Texas Health Facilities Development Corporation, Hospital Revenue Bonds 8/03 at 102 AAA 6,677,421
(All Saints Episcopal Hospitals of Fort Worth Project), Series 1993B,
6.250%, 8/15/22
5,115,000 Texas Department of Housing and Community Affairs, Single Family Mortgage 9/07 at 102 AAA 5,295,508
Revenue Bonds, 1997 Series A Teams Structure, 5.800%, 9/01/29
(Alternative Minimum Tax)
</TABLE>
23
<PAGE>
Portfolio of Investments
Nuveen Insured Municipal Bond Fund (continued)
April 30, 1999
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Texas (continued)
$ 5,050,000 Tyler Health Facilities Development Corporation, Texas, Hospital 11/07 at 102 AAA $ 5,288,916
Revenue Bonds (East Texas Medical Center Regional Healthcare
System Project), Series 1997B, 5.600%, 11/01/27
5,000,000 Tyler Health Facilities Development Corporation, Texas, Hospital 2/09 at 102 AAA 5,003,900
Revenue Bonds (East Texas Medical Center Regional Healthcare System
Project), Series 1997D (Remarketed), 5.375%, 11/01/27
- -----------------------------------------------------------------------------------------------------------------------------------
Utah - 0.9%
3,055,000 State of Utah, State Building Ownership Authority, Lease Revenue 11/05 at 100 AAA 3,360,928
Bonds (State Facilities Master Lease Program), Series 1995A, 5.750%,
5/15/18 (Pre-refunded to 11/15/05)
60,000 Utah Housing Finance Agency, Single Family Mortgage Senior Bonds, No Opt. Call AAA 64,742
1988 Issue C (Federally Insured or Guaranteed Mortgage Loans), 8.375%,
7/01/19
3,500,000 White City Water Improvement District, Salt Lake County, Utah, General 2/05 at 100 AAA 3,964,205
Obligation Water Bonds, Series 1995, 6.600%, 2/01/25
(Pre-refunded to 2/01/05)
- -----------------------------------------------------------------------------------------------------------------------------------
Vermont - 1.1%
9,235,000 Vermont Housing Finance Agency, Single Family Housing Bonds, 6/07 at 101 1/2 AAA 9,714,758
Series 9, 5.900%, 5/01/29 (Alternative Minimum Tax)
- -----------------------------------------------------------------------------------------------------------------------------------
Washington - 2.0%
8,800,000 Public Utility District No. 1 of Chelan County, Washington, 7/08 at 102 AAA 8,638,256
Chelan Hydro-Consolidated System Revenue Bonds, Series 1998A, 5.250%,
7/01/33 (Alternative Minimum Tax)
1,000,000 City of Marysville, Washington, Water and Sewer Revenue Bonds, 12/03 at 100 AAA 1,135,590
Series of 1991, 7.000%, 12/01/11 (Pre-refunded to 12/01/03)
5,000,000 Washington Public Power Supply System, Nuclear Project No. 2 No Opt. Call AAA 5,346,100
Refunding Revenue Bonds, Series 1993B, 5.400%, 7/01/05
2,000,000 Bellingham School District No. 501, Whatcom County, Washington, 12/04 at 100 AAA 2,222,939
Unlimited Tax General Obligation Bonds, Series of 1994, 6.125%,
12/01/13 (Pre-refunded to 12/01/04)
- -----------------------------------------------------------------------------------------------------------------------------------
Wisconsin - 0.4%
2,000,000 City of Superior, Wisconsin, Limited Obligation Refunding Revenue No Opt. Call AAA 2,480,119
Bonds (Midwest Energy Resources Company Project), Series E-1991
(Collateralized), 6.900%, 8/01/21
1,000,000 Three Lakes School District General Obligation, 6.750%, 4/01/12 4/03 at 100 AAA 1,110,100
(Pre-refunded to 4/01/03)
- -----------------------------------------------------------------------------------------------------------------------------------
Wyoming - 0.2%
2,000,000 The Trustees of the University of Wyoming, Facilities Revenue Bonds, 6/00 at 101 AAA 2,092,019
Series 1991, 7.100%, 6/01/10
- -----------------------------------------------------------------------------------------------------------------------------------
$841,771,000 Total Investments - (cost $782,201,919) - 99.1% 853,095,629
============-----------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 0.9% 7,665,826
--------------------------------------------------------------------------------------------------------------------
Net Assets - 100% $860,761,455
====================================================================================================================
</TABLE>
All of the bonds in the portfolio are either covered by Original
Issue Insurance. Secondary Market Insurance or Portfolio
Insurance, or are backed by an escrow or trust containing
sufficient U.S. Government agency securities, any of which ensure
the timely payment of principal and interest.
* Optional Call Provisions (not covered by the report of
independent public accountants): Dates (month and year) and
prices of the earliest optional call or redemption. There may be
other call provisions at varying prices at later dates.
** Ratings (not covered by the report of independent public
accountants): Using the higher of Standard & Poor's or Moody's
rating.
(WI) Security purchased on a when-issued basis (note 1).
See accompanying notes to financial statements.
24
<PAGE>
Statement of Net Assets
April 30, 1999
<TABLE>
<CAPTION>
Insured
Municipal Bond Municipal Bond
- --------------------------------------------------------------------------------------------------
<S> <C> <C>
Assets
Investments in municipal securities, at market value (note 1) $2,919,418,804 $853,095,629
Cash 12,291,880 --
Receivables:
Interest 52,043,093 15,179,604
Investments sold 200,000 --
Shares sold 962,964 1,548,296
Other assets 39,634 9,675
- --------------------------------------------------------------------------------------------------
Total assets 2,984,956,375 869,833,204
- --------------------------------------------------------------------------------------------------
Liabilities
Cash overdraft -- 560,417
Payables:
Investments purchased -- 4,984,896
Shares redeemed 2,665,578 648,400
Accrued expenses:
Management fees (note 6) 1,101,513 336,490
12b-1 distribution and service fees (notes 1 and 6) 30,273 34,514
Other 303,397 189,042
Dividends payable 9,145,532 2,317,990
- --------------------------------------------------------------------------------------------------
Total liabilities 13,246,293 9,071,749
- --------------------------------------------------------------------------------------------------
Net assets (note 7) $2,971,710,082 $860,761,455
==================================================================================================
Class A Shares (note 1)
Net assets $ 120,418,263 $109,985,516
Shares outstanding 12,579,145 9,859,679
Net asset value and redemption price per share $ 9.57 $ 11.16
Offering price per share (net asset value per share plus
maximum sales charge of 4.20% of offering price) $ 9.99 $ 11.65
==================================================================================================
Class B Shares (note 1)
Net assets $ 10,085,570 $ 13,601,583
Shares outstanding 1,053,529 1,219,133
Net asset value, offering and redemption price per share $ 9.57 $ 11.16
==================================================================================================
Class C Shares (note 1)
Net assets $ 7,190,608 $ 10,946,794
Shares outstanding 751,553 990,641
Net asset value, offering and redemption price per share $ 9.57 $ 11.05
==================================================================================================
Class R Shares (note 1)
Net assets $2,834,015,641 $726,227,562
Shares outstanding 295,863,325 65,343,430
Net asset value, offering and redemption price per share $ 9.58 $ 11.11
==================================================================================================
</TABLE>
See accompanying notes to financial statements.
25
<PAGE>
Statement of Operations
Year Ended April 30, 1999
<TABLE>
<CAPTION>
Insured
Municipal Bond Municipal Bond
- ------------------------------------------------------------------------------------------------------
Investment Income (note 1) $163,127,763 $47,880,643
- ------------------------------------------------------------------------------------------------------
<S> <C> <C>
Expenses
Management fees (note 6) 13,391,083 4,052,926
12b-1 service fees - Class A (notes 1 and 6) 218,760 201,568
12b-1 distribution and service fees -- Class B (notes 1 and 6) 62,958 90,103
12b-1 distribution and service fees -- Class C (notes 1 and 6) 45,440 70,475
Shareholders' servicing agent fees and expenses 2,611,482 757,723
Custodian's fees and expenses 316,474 123,192
Trustees' fees and expenses (note 6) 56,461 13,824
Professional fees 61,856 19,888
Shareholders' reports -- printing and mailing expenses 500,720 152,849
Federal and state registration fees 97,695 71,871
Portfolio insurance expense -- 32,366
Other expenses 61,175 26,655
- ------------------------------------------------------------------------------------------------------
Total expenses 17,424,104 5,613,440
- ------------------------------------------------------------------------------------------------------
Net investment income 145,703,659 42,267,203
- ------------------------------------------------------------------------------------------------------
Realized and Unrealized Gain from Investments
Net realized gain from investment transactions (notes 1 and 4) 9,886,226 1,889,114
Net change in unrealized appreciation or depreciation of investments 33,024,384 9,916,541
- ------------------------------------------------------------------------------------------------------
Net gain from investments 42,910,610 11,805,655
- ------------------------------------------------------------------------------------------------------
Net increase in net assets from operations $188,614,269 $54,072,858
======================================================================================================
See accompanying notes to financial statements.
</TABLE>
26
<PAGE>
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
Municipal Bond Insured Municipal Bond
----------------------------- ----------------------------
Year Ended Year Ended Year Ended Year Ended
4/30/99 4/30/98 4/30/99 4/30/98
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Operations
Net investment income $ 145,703,659 $ 147,700,569 $ 42,267,203 $ 41,918,555
Net realized gain from investment transactions (notes 1 and 4) 9,886,226 7,384,205 1,889,114 6,786,199
Net change in unrealized appreciation or depreciation
of investments 33,024,384 100,807,694 9,916,541 23,049,222
- ----------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets from operations 188,614,269 255,892,468 54,072,858 71,753,976
- ----------------------------------------------------------------------------------------------------------------------------------
Distributions to Shareholders (note 1)
From undistributed net investment income:
Class A (5,110,885) (4,066,811) (4,814,934) (3,941,471)
Class B (259,255) (85,661) (375,574) (102,807)
Class C (250,362) (205,194) (396,974) (294,623)
Class R (139,355,083) (144,088,029) (36,432,960) (37,785,864)
From accumulated net realized gains from investment transactions:
Class A (276,503) (268,871) (289,942) (249,043)
Class B (16,969) (6,710) (28,707) (6,889)
Class C (15,972) (15,012) (28,282) (20,375)
Class R (7,337,232) (9,099,862) (2,094,492) (2,288,357)
- ----------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets from distributions to shareholders (152,622,261) (157,836,150) (44,461,865) (44,689,429)
- ----------------------------------------------------------------------------------------------------------------------------------
Fund Share Transactions (note 2)
Net proceeds from sale of shares 174,357,355 188,619,020 79,661,007 75,516,982
Net proceeds from shares issued to shareholders due
to reinvestment of distributions 116,641,699 123,635,013 29,306,392 30,119,890
- ----------------------------------------------------------------------------------------------------------------------------------
290,999,054 312,254,033 108,967,399 105,636,872
- ----------------------------------------------------------------------------------------------------------------------------------
Cost of shares redeemed (279,773,551) (336,624,740) (88,373,485) (92,161,203)
- ----------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets from Fund share
transactions 11,225,503 (24,370,707) 20,593,914 13,475,669
- ----------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets 47,217,511 73,685,611 30,204,907 40,540,216
Net assets at the beginning of year 2,924,492,571 2,850,806,960 830,556,548 790,016,332
- ----------------------------------------------------------------------------------------------------------------------------------
Net assets at the end of year $2,971,710,082 $2,924,492,571 $860,761,455 $830,556,548
==================================================================================================================================
Balance of undistributed net investment income at the end of year $ 1,260,486 $ 532,412 $ 566,781 $ 320,020
==================================================================================================================================
See accompanying notes to financial statements.
</TABLE>
27
<PAGE>
Notes to Financial Statements (continued)
1. General Information and Significant Accounting Policies
The Nuveen Flagship Municipal Trust (the "Trust") is an open-end diversified
investment company registered under the Investment Company Act of 1940, as
amended. The Trust comprises the Nuveen Municipal Bond Fund ("Municipal Bond")
and the Nuveen Insured Municipal Bond Fund ("Insured Municipal Bond")
(collectively the "Funds"), among others. The Trust was organized as a
Massachusetts business trust on July 1, 1996.
Each fund seeks to provide high tax-free income and preservation of capital
through investments in diversified portfolios of quality municipal bonds.
The following is a summary of significant accounting policies followed by the
Funds in the preparation of their financial statements in accordance with
generally accepted accounting principles.
Securities Valuation
The prices of municipal bonds in each Fund's investment portfolio are provided
by a pricing service approved by the Funds' Board of Trustees. When price quotes
are not readily available (which is usually the case for municipal securities),
the pricing service establishes fair market value based on yields or prices of
municipal bonds of comparable quality, type of issue, coupon, maturity and
rating, indications of value from securities dealers and general market
conditions. Temporary investments in securities that have variable rate and
demand features qualifying them as short-term securities are valued at amortized
cost, which approximates market value:
Securities Transactions
Securities transactions are recorded on a trade date basis. Realized gains and
losses from such transactions are determined on the specific identification
method. Securities purchased or sold on a when-issued or delayed delivery basis
may have extended settlement periods. Any securities so purchased are subject to
market fluctuation during this period. The Funds have instructed the custodian
to segregate assets in a separate account with a current value at least equal to
the amount of the when-issued and delayed delivery purchase commitments. At
April 30, 1999, Insured Municipal Bond had an outstanding when-issued purchase
commitment of $4,984,896. There were no such outstanding purchase commitments in
Municipal Bond.
Investment Income
Interest income is determined on the basis of interest accrued, adjusted for
amortization of premiums and accretion of discounts on long-term debt securities
when required for federal income tax purposes.
Dividends and Distributions to Shareholders
Tax-exempt net investment income is declared monthly as a dividend and payment
is made or reinvestment is credited to shareholder accounts on the first
business day after month-end. Net realized capital gains and/or market discount
from investment transactions, if any, are distributed to shareholders not less
frequently than annually. Furthermore, capital gains are distributed only to the
extent they exceed available capital loss carryforwards.
Distributions to shareholders of tax-exempt net investment income, net realized
capital gains and market discount are recorded on the ex-dividend date. The
amount and timing of distributions are determined in accordance with federal
income tax regulations, which may differ from generally accepted accounting
principles. Accordingly, temporary over-distributions as a result of these
differences may occur and will be classified as either distributions in excess
of net investment income, distributions in excess of net realized gains and/or
distributions in excess of net ordinary taxable income from investment
transactions, where applicable.
28
<PAGE>
Federal Income Taxes
Each Fund is a separate taxpayer for federal income tax purposes. Each Fund
intends to comply with the requirements of the Internal Revenue Code applicable
to regulated investment companies and to distribute all of its tax-exempt net
investment income, in addition to any significant amounts of net realized
capital gains and/or market discount realized from investment transactions. The
Funds currently consider significant net realized capital gains and/or market
discount as amounts in excess of $.001 per share. Furthermore, each Fund intends
to satisfy conditions which will enable interest from municipal securities,
which is exempt from regular federal income tax, to retain such tax-exempt
status when distributed to the shareholders of the Funds. All monthly tax-exempt
income dividends paid during the fiscal year ended April 30, 1999, have been
designated Exempt Interest Dividends. Net realized capital gain and market
discount distributions are subject to federal taxation.
Insurance
Insured Municipal Bond invests in municipal securities which are either covered
by insurance or backed by an escrow or trust account containing sufficient U.S.
government or U.S. government agency securities, both of which ensure the timely
payment of principal and interest. Each insured municipal security is covered by
Original Issue Insurance, Secondary Market Insurance or Portfolio Insurance.
Such insurance does not guarantee the market value of the municipal securities
or the value of the Fund's shares. Original Issue Insurance and Secondary Market
Insurance remain in effect as long as the municipal securities covered thereby
remain outstanding and the insurer remains in business, regardless of whether
the Fund ultimately disposes of such municipal securities. Consequently, the
market value of the municipal securities covered by Original Issue Insurance or
Secondary Market Insurance may reflect value attributable to the insurance.
Portfolio Insurance is effective only while the municipal securities are held by
the Fund. Accordingly, neither the prices used in determining the market value
of the underlying municipal securities nor the net asset value of the Fund's
shares include value, if any, attributable to the Portfolio Insurance. Each
policy of the Portfolio Insurance does, however, give the Fund the right to
obtain permanent insurance with respect to the municipal security covered by the
Portfolio Insurance policy at the time of its sale.
Flexible Sales Charge Program
Each Fund offers Class A, B, C and R Shares. Class A Shares are sold with a
sales charge and incur an annual 12b-1 service fee. Class A Share purchases of
$1 million or more are sold at net asset value without an up-front sales charge
but may be subject to a contingent deferred sales charge ("CDSC") if redeemed
within 18 months of purchase. Class B Shares are sold without a sales charge but
incur annual 12b-1 distribution and service fees. An investor purchasing Class B
Shares agrees to pay a CDSC of up to 5% depending upon the length of time the
shares are held by the investor (CDSC is reduced to 0% at the end of six years).
Class B Shares convert to Class A Shares eight years after purchase. Class C
Shares are sold without a sales charge but incur annual 12b-1 distribution and
service fees. An investor purchasing Class C Shares agrees to pay a CDSC of 1%
if Class C Shares are redeemed within one year of purchase. Class R Shares are
not subject to any sales charge or 12b-1 distribution or service fees. Class R
Shares are available only under limited circumstances, or by specified classes
of investors.
Derivative Financial Instruments
The Funds may invest in certain derivative financial instruments including
futures, forward, swap and option contracts, and other financial instruments
with similar characteristics. Although the Funds are authorized to invest in
such financial instruments, and may do so in the future, they did not make any
such investments during the fiscal year ended April 30, 1999.
Expense Allocation
Expenses of each Fund that are not directly attributable to a specific class of
shares are prorated among the classes based on the relative net assets of each
class. Expenses directly attributable to a class of shares, which presently only
includes 12b-1 distribution and service fees, are recorded to the specific
class.
Use of Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities at the date of the
financial statements and the
29
<PAGE>
Notes to Financial Statements (continued)
2. Fund Shares
Transactions in Fund shares were as follows:
<TABLE>
<CAPTION>
Municipal Bond
---------------------------------------------------------
Year Ended 4/30/99 Year Ended 4/30/98
---------------------------------------------------------
Shares Amount Shares Amount
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares sold:
Class A 3,884,851 $ 37,318,567 3,610,340 $ 34,138,865
Class B 649,958 6,249,871 425,808 4,027,584
Class C 358,434 3,445,814 198,476 1,867,171
Class R 13,266,170 127,343,103 15,747,999 148,585,400
Shares issued to shareholders due to reinvestment of distributions:
Class A 376,509 3,619,256 314,639 2,970,090
Class B 16,794 161,493 5,660 53,689
Class C 18,430 177,022 18,178 171,005
Class R 11,717,295 112,683,928 12,768,468 120,440,229
- ----------------------------------------------------------------------------------------------------------------------------------
30,288,441 290,999,054 33,089,568 312,254,033
- ----------------------------------------------------------------------------------------------------------------------------------
Shares redeemed:
Class A (1,942,093) (18,655,868) (1,356,476) (12,834,251)
Class B (50,591) (484,678) (45,312) (430,447)
Class C (142,641) (1,371,429) (285,886) (2,670,807)
Class R (26,989,392) (259,261,576) (33,956,929) (320,689,235)
- ----------------------------------------------------------------------------------------------------------------------------------
(29,124,717) (279,773,551) (35,644,603) (336,624,740)
- ----------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) 1,163,724 $ 11,225,503 (2,555,035) $ (24,370,707)
==================================================================================================================================
Insured Municipal Bond
---------------------------------------------------------
Year Ended 4/30/99 Year Ended 4/30/98
---------------------------------------------------------
Shares Amount Shares Amount
- ----------------------------------------------------------------------------------------------------------------------------------
Shares sold:
Class A 2,677,296 $ 29,968,100 2,354,322 $ 26,011,707
Class B 822,802 9,209,496 407,571 4,505,416
Class C 367,390 4,077,116 311,528 3,417,614
Class R 3,266,237 36,406,295 3,788,731 41,582,245
Shares issued to shareholders due to reinvestment of distributions:
Class A 281,935 3,161,785 242,808 2,675,963
Class B 16,650 186,828 5,134 56,987
Class C 24,527 272,429 22,045 240,583
Class R 2,299,262 25,685,350 2,475,051 27,146,357
- ----------------------------------------------------------------------------------------------------------------------------------
9,756,099 108,967,399 9,607,190 105,636,872
- ----------------------------------------------------------------------------------------------------------------------------------
Shares redeemed:
Class A (1,302,533) (14,580,513) (891,941) (9,818,160)
Class B (72,969) (815,543) (5,821) (65,030)
Class C (137,020) (1,519,584) (129,381) (1,413,103)
Class R (6,411,557) (71,457,845) (7,358,468) (80,864,910)
- ----------------------------------------------------------------------------------------------------------------------------------
(7,924,079) (88,373,485) (8,385,611) (92,161,203)
- ----------------------------------------------------------------------------------------------------------------------------------
Net increase 1,832,020 $ 20,593,914 1,221,579 $ 13,475,669
==================================================================================================================================
</TABLE>
30
<PAGE>
3. Distributions to Shareholders
The Funds declared dividend distributions from their tax-exempt net investment
income which were paid on June 1, 1999, to shareholders of record on May 7,
1999, as follows:
<TABLE>
<CAPTION>
Insured
Municipal Bond Municipal Bond
- -----------------------------------------------------------------------------
<S> <C> <C>
Dividend per share:
Class A $ .0375 $ .0450
Class B .0315 .0380
Class C .0330 .0395
Class R .0390 .0465
=============================================================================
</TABLE>
4. Securities Transactions
Purchases and sales (including maturities) of investments in long-term municipal
securities and short-term municipal securities for the fiscal year ended April
30, 1999, were as follows:
<TABLE>
<CAPTION>
Insured
Municipal Bond Municipal Bond
- -----------------------------------------------------------------------------
<S> <C> <C>
Purchases:
Long-term municipal securities $343,495,419 $134,039,943
Short-term municipal securities 164,493,000 64,700,000
Sales:
Long-term municipal securities 347,465,026 109,417,057
Short-term municipal securities 164,493,000 64,700,000
=============================================================================
</TABLE>
At April 30, 1999, the identified cost of investments owned for federal income
tax purposes was the same as the Cost for financial reporting purposes for each
Fund.
5. Unrealized Appreciation (Depreciation)
Gross unrealized appreciation and gross unrealized depreciation of investments
at April 30, 1999, were as follows:
<TABLE>
<CAPTION>
Insured
Municipal Bond Municipal Bond
- -----------------------------------------------------------------------------
<S> <C> <C>
Gross unrealized:
appreciation $ 261,853,519 $ 71,253,640
depreciation (1,588,626) (359,930)
- -----------------------------------------------------------------------------
Net unrealized appreciation $ 260,264,893 $ 70,893,710
=============================================================================
</TABLE>
6. Management Fee and Other Transactions with Affiliates
Under the Trust's investment management agreement with Nuveen Advisory Corp.
(the "Adviser"), a wholly owned subsidiary of The John Nuveen Company, each Fund
pays an annual management fee, payable monthly, at the rates set forth below
which are based upon the average daily net asset value of each Fund:
<TABLE>
<CAPTION>
Average Daily Net Asset Value Management Fee
- ----------------------------------------------------------------------------
<S> <C>
For the first $125 million .5000 of 1%
For the next $125 million .4875 of 1
For the next $250 million .4750 of 1
For the next $500 million .4625 of 1
For the next $1 billion .4500 of 1
For net assets over $2 billion .4250 of 1
=============================================================================
</TABLE>
The management fee compensates the Adviser for overall investment advisory and
administrative services, and general office facilities. The Trust pays no
compensation directly to those of its Trustees who are affiliated with the
Adviser or to its officers, all of whom receive remuneration for their services
to the Trust from the Adviser or its affiliates.
The Adviser has agreed to waive part of its management fees or reimburse certain
expenses of each Fund in order to limit total expenses to .75 of 1% of the
average daily net asset value of Municipal Bond and .975 of 1% of the average
daily net asset value of Insured Municipal Bond, excluding any 12b-1 fees
applicable to Class A, B and C Shares. The Adviser may also voluntarily agree to
reimburse additional expenses from time to time, which may be terminated at any
time at its discretion.
31
<PAGE>
Notes to Financial Statements (continued)
During the fiscal year ended April 30, 1999, the Distributor collected sales
charges on purchases of Class A Shares of approximately $579,200 and $567,200
for Municipal Bond and Insured Municipal Bond, respectively, of which
approximately $503,500 and $500,900, respectively, were paid out as concessions
to authorized dealers. The Distributor also received 12b-1 service fees on Class
A Shares, substantially all of which were paid to compensate authorized dealers
for providing services to shareholders relating to their investments.
During the fiscal year ended April 30, 1999, the Distributor compensated
authorized dealers directly with approximately $283,100 and $398,500 in
commission advances at the time of purchase for Municipal Bond and Insured
Municipal Bond, respectively. To compensate for commissions advanced to
authorized dealers, all 12b-1 service fees collected on Class B Shares during
the first year following a purchase, all 12b-1 distribution fees on Class B
Shares, and all 12b-1 service and distribution fees on Class C Shares during the
first year following a purchase are retained by the Distributor. During the
fiscal year ended April 30, 1999, the Distributor retained approximately $78,600
and $118,800 in such 12b-1 fees for Municipal Bond and Insured Municipal Bond,
respectively. The remaining 12b-1 fees charged to the Funds were paid to
compensate authorized dealers for providing services to shareholders relating to
their investments. The Distributor also retained approximately $24,000 and
$31,400 of CDSC on share redemptions for Municipal Bond and Insured Municipal
Bond, respectively, during the fiscal year ended April 30, 1999.
7. Composition of Net Assets
At April 30, 1999, the Funds had an unlimited number of $.01 par value shares
authorized. Net assets consisted of:
<TABLE>
<CAPTION>
Insured
Municipal Bond Municipal Bond
- ------------------------------------------------------------------------------
<S> <C> <C>
Capital paid-in $2,706,654,482 $787,802,152
Balance of undistributed net
investment income 1,260,486 566,781
Accumulated net realized gain from
investment transactions 3,530,221 1,498,812
Net unrealized appreciation of
investments 260,264,893 70,893,710
- ------------------------------------------------------------------------------
Net assets $2,971,710,082 $860,761,455
==============================================================================
</TABLE>
8. Investment Composition
At April 30, 1999, the revenue sources by municipal purpose, expressed as a
percent of long-term investments, were as follows:
<TABLE>
<CAPTION>
Insured
Municipal Bond Municipal Bond
- ------------------------------------------------------------------------------
<S> <C> <C>
Education and Civic Organizations 1% 4%
Health Care 18 15
Housing/Multifamily 7 1
Housing/Single Family 5 9
Tax Obligation/General 7 11
Tax Obligation/Limited 9 8
Transportation 5 3
U.S. Guaranteed 15 32
Utilities 23 10
Water and Sewer 9 6
Other 1 1
- ------------------------------------------------------------------------------
100% 100%
==============================================================================
</TABLE>
Certain long-term and intermediate-term investments owned by the Funds are
either covered by insurance issued by several private insurers or are backed by
an escrow or trust containing U.S. government or U.S. government agency
securities, either of which ensure the timely payment of principal and interest
in the event of default (37% for Municipal Bond and 100% for Insured Municipal
Bond). Such insurance or escrow, however, does not guarantee the market value of
the municipal securities or the value of the Funds' shares.
For additional information regarding each investment security, refer to the
Portfolio of Investments of each Fund.
32
<PAGE>
Financial Highlights
Selected data for a share outstanding throughout
each period is as follows:
<TABLE>
<CAPTION>
Class (Inception Date)
Investment Operations Less Distributions
--------------------------------- ---------------------------
Net
MUNICIPAL BOND Realized/
Unrealized
Beginning Net Invest- Net Ending
Net Invest- ment Invest- Net
Year Ended Asset ment Gain ment Capital Asset Total
April 30, Value Income (a) (Loss) Total Income Gains Total Value Return (b)
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Class A (6/95)
1999 $9.46 $.45 $ .13 $ .58 $(.45) $(.02) $(.47) $9.57 6.28%
1998 9.14 .46 .35 .81 (.46) (.03) (.49) 9.46 9.00
1997 (c) 9.24 .08 (.10) (.02) (.08) -- (.08) 9.14 (.23)
1997 (d) 9.28 .48 -- .48 (.47) (.05) (.52) 9.24 5.26
1996 (e) 9.15 .34 .14 .48 (.32) (.03) (.35) 9.28 5.33
Class B (2/97)
1999 9.46 .38 .13 .51 (.38) (.02) (.40) 9.57 5.49
1998 9.15 .38 .35 .73 (.39) (.03) (.42) 9.46 8.09
1997 (c) 9.24 .09 (.11) (.02) (.07) -- (.07) 9.15 (.25)
1997 (e) 9.23 .03 .01 .04 (.03) -- (.03) 9.24 .47
Class C (6/95)
1999 9.44 .40 .15 .55 (.40) (.02) (.42) 9.57 5.91
1998 9.14 .40 .34 .74 (.41) (.03) (.44) 9.44 8.20
1997 (c) 9.23 .07 (.09) (.02) (.07) -- (.07) 9.14 (.21)
1997 (d) 9.26 .42 -- .42 (.40) (.05) (.45) 9.23 4.64
1996 (e) 9.15 .29 .13 .42 (.28) (.03) (.31) 9.26 4.59
Class R (11/76)
1999 9.46 .47 .14 .61 (.47) (.02) (.49) 9.58 6.59
1998 9.15 .48 .34 .82 (.48) (.03) (.51) 9.46 9.09
1997 (c) 9.24 .08 (.09) (.01) (.08) -- (.08) 9.15 (.09)
1997 (d) 9.28 .49 .01 .50 (.49) (.05) (.54) 9.24 5.53
1996 (d) 9.00 .51 .31 .82 (.51) (.03) (.54) 9.28 9.31
1995 (d) 9.28 .52 (.21) .31 (.51) (.08) (.59) 9.00 3.60
=======================================================================================================================
</TABLE>
<TABLE>
<CAPTION>
Ratios/Supplemental Data
-------------------------------------------------------------------------------
Ratio Ratio
of Net of Net
Ratio of Investment Ratio of Investment
Expenses Income Expenses Income to
to Average to Average to Average Average
Ending Net Assets Net Assets Net Assets Net Assets
Net Before Before After After Portfolio
Year Ended Assets Reimburse- Reimburse- Reimburse- Reimburse- Turnover
April 30, (000) ment ment ment (a) ment (a) Ratio
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Class A (6/95)
1999 $ 120,418 .77% 4.71% .77% 4.71% 12%
1998 97,029 .80 4.83 .80 4.83 10
1997 (c) 70,331 .77* 5.13* .77* 5.13* 2
1997 (d) 68,204 .81 5.11 .81 5.11 12
1996 (e) 37,089 .86* 5.11* .83* 5.14* 17
Class B (2/97)
1999 10,086 1.52 3.96 1.52 3.96 12
1998 4,136 1.56 4.05 1.56 4.05 10
1997 (c) 468 1.53* 4.39* 1.53* 4.39* 2
1997 (e) 43 1.51 5.23 1.51* 5.23* 12
Class C (6/95)
1999 7,191 1.32 4.15 1.32 4.15 12
1998 4,886 1.35 4.29 1.35 4.29 10
1997 (c) 5,360 1.32* 4.58* 1.32* 4.58* 2
1997 (d) 5,039 1.54 4.37 1.54 4.37 12
1996 (e) 1,915 1.64* 4.33* 1.58* 4.39* 17
Class R (11/76)
1999 2,834,016 .57 4.90 .57 4.90 12
1998 2,818,442 .60 5.04 .60 5.04 10
1997 (c) 2,774,648 .57* 5.33* .57* 5.33* 2
1997 (d) 2,818,214 .57 5.35 .57 5.35 12
1996 (d) 2,878,641 .59 5.53 .59 5.53 17
1995 (d) 2,741,178 .59 5.79 .59 5.79 17
=================================================================================================
</TABLE>
* Annualized.
(a) After waiver of certain management fees or reimbursement of expenses, if
applicable, by Nuveen Advisory.
(b) Total returns are calculated on net asset value without any sales charge
and are not annualized.
(c) For the two months ended April 30.
(d) For the fiscal year ended February 28/29.
(e) From commencement of class operations as noted through February 28/29.
33
<PAGE>
Financial Highlights (continued)
Selected data for a share outstanding throughout each period is as follows:
Class (Inception Date)
<TABLE>
<CAPTION>
Investment Operations Less Distributions
------------------------------- ------------------------------
Net
INSURED MUNICIPAL BOND Realized/
Unrealized
Beginning Net Invest- Net Ending
Net Invest- ment Invest- Net
Year Ended Asset ment Gain ment Capital Asset Total
April 30, Value Income (a) (Loss) Total Income Gains Total Value Return (b)
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Class A (9/94)
1999 $11.03 $.54 $ .16 $ .70 $(.54) $(.03) $(.57) $11.16 6.43%
1998 10.66 .54 .41 .95 (.55) (.03) (.58) 11.03 9.05
1997 (c) 10.82 .09 (.16) (.07) (.09) - (.09) 10.66 (.63)
1997 (d) 10.97 .56 (.13) .43 (.54) (.04) (.58) 10.82 4.04
1996 (d) 10.40 .54 .57 1.11 (.54) - (.54) 10.97 10.90
1995 (e) 10.31 .26 .12 .38 (.27) (.02) (.29) 10.40 3.84
Class B (2/97)
1999 11.03 .45 .16 .61 (.45) (.03) (.48) 11.16 5.63
1998 10.67 .46 .39 .85 (.46) (.03) (.49) 11.03 8.14
1997 (c) 10.82 .09 (.16) (.07) (.08) - (.08) 10.67 (.65)
1997 (e) 10.80 .04 .02 .06 (.04) - (.04) 10.82 .55
Class C (9/94)
1999 10.92 .47 .16 .63 (.47) (.03) (.50) 11.05 5.86
1998 10.56 .48 .39 .87 (.48) (.03) (.51) 10.92 8.39
1997 (c) 10.72 .08 (.16) (.08) (.08) - (.08) 10.56 (.73)
1997 (d) 10.85 .46 (.09) .37 (.46) (.04) (.50) 10.72 3.48
1996 (d) 10.31 .46 .54 1.00 (.46) - (.46) 10.85 9.88
1995 (e) 10.29 .23 .08 .31 (.27) (.02) (.29) 10.31 3.09
Class R (12/86)
1999 10.98 .56 .15 .71 (.55) (.03) (.58) 11.11 6.62
1998 10.62 .56 .39 .95 (.56) (.03) (.59) 10.98 9.17
1997 (c) 10.78 .09 (.15) (.06) (.10) - (.10) 10.62 (.60)
1997 (d) 10.92 .57 (.11) .46 (.56) (.04) (.60) 10.78 4.38
1996 (d) 10.38 .57 .54 1.11 (.57) - (.57) 10.92 10.94
1995 (d) 10.81 .57 (.40) .17 (.58) (.02) (.60) 10.38 1.85
=======================================================================================================================
</TABLE>
<TABLE>
<CAPTION>
Ratios/Supplemental Data
-----------------------------------------------------------------------------------
Ratio Ratio
of Net of Net
Ratio of Investment Ratio of Investment
Expenses Income Expenses Income to
to Average to Average to Average Average
Ending Net Assets Net Assets Net Assets Net Assets
Net Before Before After After Portfolio
Year Ended Assets Reimburse- Reimburse- Reimburse- Reimburse- Turnover
April 30, (000) ment ment ment (a) ment (a) Rate
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Class A (9/94)
1999 $109,986 .81% 4.80% .81% 4.80% 13%
1998 90,459 .86 4.91 .86 4.91 40
1997 (c) 69,291 .84* 5.12* .84* 5.12* 12
1997 (d) 68,268 .87 5.07 .87 5.07 35
1996 (d) 46,943 .92 5.00 .91 5.01 27
1995 (e) 14,097 1.27* 5.28* 1.00* 5.55* 25
Class B (2/97)
1999 13,602 1.56 4.05 1.56 4.05 13
1998 4,992 1.61 4.14 1.61 4.14 40
1997 (c) 488 1.59* 4.36* 1.59* 4.36* 12
1997 (e) 228 1.58* 4.84* 1.58* 4.84* 35
Class C (9/94)
1999 10,947 1.36 4.25 1.36 4.25 13
1998 8,037 1.41 4.36 1.41 4.36 40
1997 (c) 5,615 1.39* 4.57* 1.39* 4.57* 12
1997 (d) 5,448 1.61 4.33 1.61 4.33 35
1996 (d) 5,151 1.63 4.34 1.63 4.34 27
1995 (e) 3,979 1.75* 4.83* 1.75* 4.83* 25
Class R (12/86)
1999 726,228 .62 5.00 .62 5.00 13
1998 727,068 .66 5.12 .66 5.12 40
1997 (c) 714,622 .64* 5.31* .64* 5.31* 12
1997 (d) 732,587 .63 5.31 .63 5.31 35
1996 (d) 761,936 .63 5.33 .63 5.33 27
1995 (d) 736,702 .64 5.67 .64 5.67 25
=========================================================================================================
</TABLE>
* Annualized.
(a) After waiver of certain management fees or reimbursement of expenses, if
applicable, by Nuveen Advisory.
(b) Total returns are calculated on net asset value without any sales charge
and are not annualized.
(c) For the two months ended April 30.
(d) For the fiscal year ended February 28/29.
(e) From commencement of class operations as noted through February 28/29.
34
<PAGE>
Report of Independent Public Accountants
To the Board of Trustees and Shareholders of
Nuveen Flagship Municipal Trust:
We have audited the accompanying statements of net assets, including the
portfolios of investments, of the Nuveen Municipal Bond Fund and Nuveen Insured
Municipal Bond Fund (two of the portfolios constituting the Nuveen Flagship
Municipal Trust (a Massachusetts business trust)), as of April 30, 1999, and the
related statements of operations, statements of changes in net assets and the
financial highlights for the periods indicated thereon. These financial
statements and financial highlights are the responsibility of the Fund's
management. Our responsibility is to express an opinion on these financial
statements and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of April
30, 1999, by correspondence with the custodian and brokers. As to securities
purchased but not received, we requested confirmation from brokers and, when
replies were not received, we carried out alternative auditing procedures. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the net assets of the Nuveen
Municipal Bond Fund and Nuveen Insured Municipal Bond Fund of the Nuveen
Flagship Municipal Trust as of April 30, 1999, and the results of their
operations, the changes in their net assets and their financial highlights for
the periods indicated thereon in conformity with generally accepted accounting
principles.
ARTHUR ANDERSEN LLP
Chicago, Illinois
June 18, 1999
35
<PAGE>
Building a Better Portfolio
Can Make You a Successful Investor
Nuveen Family of Mutual Funds
Nuveen offers a variety of funds designed to help you reach your financial
goals.
Growth
Nuveen Rittenhouse
Growth Fund
Growth and Income
European Value Fund
Growth and
Income Stock Fund
Balanced Stock
and Bond Fund
Balanced Municipal
and Stock Fund
Dividend and
Growth Fund
Income
Income Fund
Tax-Free Income
National Funds
Long-Term
Insured
Intermediate-Term
Limited-Term
State Funds
Arizona
California
Colorado
Connecticut
Florida
Georgia
Kansas
Kentucky
Louisiana
Maryland
Massachusetts
Michigan
Missouri
New Jersey
New Mexico
New York
North Carolina
Ohio
Pennsylvania
Tennessee
Virginia
Wisconsin
Successful investors know that a well-diversified portfolio - one that balances
different types of investments, levels of risk and tax management - can be the
foundation for building and sustaining wealth. That's why Nuveen offers you and
your financial adviser a wide range of quality investments that can help you
build a better portfolio in the pursuit of your financial goals.
Mutual Funds
Nuveen offers a family of equity, balanced and municipal bond funds featuring
Premier Advisers/SM/ including Institutional Capital Corporation, Rittenhouse
Financial Services, and Nuveen Advisory Corp. Each brings a specialized
expertise in a particular investment style or asset class, time-tested
investment strategies and a focus on consistent, long-term performance. With
Nuveen's Premier Adviser funds, you have all the advantages of a family of funds
plus the benefits of specialized investment expertise.
Private Asset Management
Rittenhouse Financial Services and Nuveen Asset Management offer comprehensive,
customized investment management solutions to investors with assets of $250,000
or more to invest. A range of actively managed growth, balanced and municipal
income-oriented portfolios are available, all based upon a disciplined
investment philosophy.
Defined Portfolios
Nuveen Defined Portfolios are fixed portfolios of quality securities that are a
convenient, attractive alternative to purchasing individual securities. They
provide low-cost diversification to reduce risk, while also offering
experienced, professional security selection and surveillance. In addition,
Nuveen Defined Portfolios provide daily liquidity at that day's net asset value
for quick access to your assets.
Exchange-Traded Funds
Nuveen Exchange-Traded Funds offer investors actively managed portfolios of
investment-grade quality municipal bonds. The fund shares are listed and traded
on the New York and American stock exchanges. Exchange-traded funds provide the
investment convenience, price visibility and liquidity of common stocks.
MuniPreferred/R/
Nuveen MuniPreferred offers investors a AAA rated investment with an attractive
tax-free yield for the cash reserves portion of an investment portfolio.
MuniPreferred shares are backed 2-to-1 by the long-term portfolios of Nuveen
dual-class exchange-traded funds and are available for national as well as a
wide variety of state-specific portfolios.
36
<PAGE>
Fund Information
Board of Trustees
Robert R Bremner
Lawrence H. Brown
Anne E. Impellizzeri
Peter R. Sawers
William J. Schneider
Timothy R. Schwertfeger
Judith M. Stockdale
Fund Manager
Nuveen Advisory Corp.
333 West Wacker Drive
Chicago, IL 60606
Transfer Agent and
Shareholder Services
Chase Global Fund Services Company
P.O. Box 5186
New York, NY 10274
(800) 257-8787
Legal Counsel
Morgan, Lewis &
Bockius LLP
Washington, D.C.
Independent Public
Accountants
Arthur Andersen LLP
Chicago, IL
- -----
37
<PAGE>
SERVING
Investors for Generations
Since our founding in 1898, John Nuveen & Co. has been synonymous with
investments that withstand the test of time. Today we offer a broad range of
quality investments designed for individuals seeking to build and sustain
wealth. In fact, more than 1.3 million investors have trusted Nuveen to help
them pursue their financial goals.
The cornerstone of Nuveen's investment philosophy is a commitment to
disciplined long-term investment strategies whose aim is to provide consistent,
competitive performance over time - with moderated risk. We emphasize quality
securities carefully chosen through in-depth research, and we follow those
securities closely over time to ensure that they continue to meet our exacting
standards.
Whether your focus is long-term growth, dependable income or sustaining
accumulated wealth, Nuveen offers a wide variety of investments and services to
help meet your unique circumstances and financial planning needs. Our growth,
growth and income, income, and tax-free funds, along with our defined portfolios
and private asset management, can help you build a better, well-diversified
portfolio.
Talk with your financial adviser to learn more about how Nuveen investment
products and services can help you. Or call us at (800) 257-8787 for more
information, including a prospectus where applicable. Please read that
information carefully before investing.
[Photo of John Nuveen, Sr.
appears here]
John Nuveen, Sr.
NUVEEN
John Nuveen & Co. Incorporated
333 West Wacker Drive
Chicago, IL. 60606-1286
www.nuveen.com
<PAGE>
April 30, 1999 Annual Report
NUVEEN
Mutual Funds
Nuveen Municipal Bond Funds
[PHOTO APPEARS HERE]
Dependable, tax-free
income to help
you keep more
of what you earn.
All-American
Municipal Bond Fund
Intermediate
Municipal Bond Fund
Limited Term
Municipal Bond Fund
Featuring Portfolio Management By Nuveen Investment Advisory Services
A Premier Adviser(SM) for Income Investing
<PAGE>
Contents
1 Dear Shareholder
4 Report from the Portfolio Managers
7 Nuveen Flagship All-American Municipal Bond Fund Highlights
8 Nuveen Flagship Intermediate Municipal Bond Fund
9 Nuveen Flagship Limited Term Municipal Bond Fund Highlights
10 Portfolio of Investments
36 Statement of Net Assets
37 Statement of Operations
38 Statement of Changes in Net Assets
39 Notes to Financial Statements
45 Financial Highlights
48 Report of Independent Public Accountants
49 Fund Information
<PAGE>
DEAR Shareholder
I would like to take the opportunity to report on the performance of the Nuveen
Flagship All-American Municipal Bond Fund, the Nuveen Flagship Intermediate
Municipal Bond Fund and the Nuveen Flagship Limited Term Municipal Bond Fund for
the fiscal year ended April 30, 1999.
[PHOTO OF TIMOTHY R. SCHWERTFEGER APPEARS HERE]
Timothy R. Schwertfeger
Chairman of the Board
"Improvements in productivity, spurred by technological advances, have been
responsible for offsetting wage and other inflationary pressures."
The Year in Review.
The past 12 months saw the U.S. economy continue its pattern of non-inflationary
growth, accompanied by low interest rates and unemployment levels that remain
among the lowest in three decades. Much of the current economic growth is
propelled by consumer demand, which has helped the U.S. resist the downward pull
of weaker overseas markets.
All indications point to a confident U.S. consumer who is comfortable with the
current state of the economy, especially the performance of the housing, stock
and job markets. This confidence is reflected in the most recent Consumer
Confidence Index report, issued by the Conference Board Inc., which showed a
record-setting seventh consecutive month of gains in May.
On the global front, the turmoil of the past two years appears to be fading
somewhat, as international financial markets have begun to send recovery
signals.
Inflation in the U.S. continued to operate at benign levels, with an increase
of 2.2% for the 12 months ended April 30, 1999. Despite a spike in consumer
prices in April, propelled by rising energy costs (which have subsequently
declined), the general backdrop of inflation indicators continued to be mild,
with the employment cost index, average hourly earnings, and import and producer
price trends all remaining favorable.
As Federal Reserve Chairman Alan Greenspan recently stated, one of the key
factors in achieving today's peaceful coexistence of economic growth and low
inflation has been increased productivity. Improvements in productivity, spurred
by technological advances, have been responsible for offsetting wage and other
inflationary pressures that we would normally expect to see as part of a growing
economy.
1
<PAGE>
"Municipal bonds represented a reasonably insulated haven in an otherwise
turbulent market, with lower volatility relative to Treasury bonds and other
fixed-income investments."
On the interest rate front, last fall saw the Federal Reserve ease short-term
rates for the first time in almost three years. Between the end of September and
mid-November 1998, three successive cuts brought the federal funds rate to
4.75%, averting a potential domestic credit crunch and restoring some stability
to global markets. The fed funds rate is the rate that banks charge each other
for overnight loans and serves as the basis many financial institutions use for
setting interest charges on a variety of products, from mortgage and car loans
to credit cards.
Following the success of these preemptive moves, the Fed indicated that
fighting inflation continued to be a top priority by remaining in a proactive
mode and responding to April's increased consumer prices with a shift to a
tightening bias. By doing this, the Fed signaled its continued support of the
market without changing interest rates or fundamentally altering the economy.
In the months ahead, we will continue to watch for indications from the Fed
and other factors that affect the economy's future, including wage and
employment statistics, reports on productivity growth, capital equipment
spending and the progress of international economic recovery. We believe these
key components will influence the outlook for fixed-income markets well into the
new millennium.
Municipal Bonds: An Attractive Investment Option.
As interest rates declined over the past year, our municipal bond funds
continued to provide bright spots among the various investment options, offering
attractive, stable income in a market that places a high premium on yield. In
1998, municipal bonds represented a reasonably insulated haven in an otherwise
turbulent market, with lower volatility relative to Treasury bonds and other
fixed-income investments. In fact, for the first four months of 1999, municipals
outperformed Treasuries.
The high ratio of tax-exempt municipal yields to Treasury yields sheltered
municipal bonds from the price decline that occurred in the Treasury market
during the first four months of the year.
While the interest rate on 30-year Treasury bonds rose from 5.10% at the end
of December to 5.66% as of April 30, 1999, the yield on the Bond Buyer Revenue
Bond Index, an unmanaged index of long-term municipal revenue bonds, gained just
three basis points--from 5.26% to 5.29%. Given the inverse relationship between
interest rates and bond prices, we saw bond prices fall as rates rose over this
period. Though municipal bond prices did decrease, the decline was not as
dramatic as the drop in Treasuries.
The differential in performance reflects the fact that Treasuries had become
relatively expensive as the result of safe-haven buying during the international
economic crises of the past year. As the financial turmoil subsided, however,
foreign investors returned to investing in their own countries rather than in
U.S. dollar-denominated securities, and the decline in demand caused U.S.
Treasuries to drop in price.
At the end of April 1999, the ratio between long-term municipal yields and 30-
year Treasury yields stood at 94%, compared with the historical average of 86%
for the period of 1986-1999. For investors, this meant that quality long-term
municipal bonds offered yields comparable to those of long Treasury bonds--even
before the tax advantages of municipal bonds were taken into
2
<PAGE>
account. On an after-tax basis in today's market, municipal bonds continue to
present an exceptionally attractive investment option relative to Treasuries.
During 1998, lower interest rates and the strong economy combined to generate
high levels of new municipal issuance and a significant increase in the
refinancing of existing bonds. Municipal issuance in 1998 reached $284 billion,
up 29% over 1997.
In terms of total municipal issuance, 1998 ranked as the second largest year
on record, next to 1993's $292 billion. In the first four months of 1999,
however, as the market settled into a more stable interest rate environment,
refunding activity dropped off dramatically. As a result, municipal supply in
1999 has declined by approximately 25% from the levels of a year ago. This, in
turn, has enhanced the attractiveness of the municipal bonds that were brought
to market, as demand--especially from individual investors--remained relatively
strong.
The strength of the U.S. economy continues to benefit municipal issuers, as
higher tax revenues produced improvements in the fundamental health of many
municipalities. In 1998, for example, state tax revenues rose by an average of
6.9%. This expanded flow of tax dollars resulted in higher credit ratings for
many municipal governments. (Moody's Investors Service, Inc. and Standard &
Poor's Corporation issue credit ratings for municipal bonds, representing their
opinions as to the quality of the securities.)
The Value of Nuveen Expertise. Nuveen Mutual Funds are a diverse collection of
investments featuring an impressive ensemble of highly regarded asset management
firms--Premier Advisers/SM/--who direct the investment activities of each
portfolio.
The Premier Advisers are firms that have earned a reputation for excellence in
their field of expertise--whether in municipal bonds, blue-chip growth stocks,
large-cap value stocks or international securities. They include: Nuveen
Investment Advisory Services for income investing, Rittenhouse Financial
Services for growth investing, and Institutional Capital Corporation for value
investing.
For more information on our funds, contact your financial adviser for a
prospectus, or call Nuveen at (800) 621-7227, or download one from
www.nuveen.com. Please read the prospectus carefully before you invest or send
money. We encourage you to talk with your financial adviser about Nuveen's
expanding array of investments and the ways they can help you establish a
diversified portfolio designed to build and sustain long-term financial
security.
Nuveen Flagship All-American Municipal Bond Fund, Nuveen Flagship Intermediate
Municipal Bond Fund and Nuveen Flagship Limited Term Municipal Bond Fund are
just three examples of the quality investments that embody Nuveen's income
investing expertise--carrying on a tradition established throughout Nuveen's
100-year history. More than 1.3 million investors have trusted Nuveen to help
them build and sustain the wealth of a lifetime. We are grateful for the
confidence you have placed in us and are dedicated to maintaining your trust in
the years ahead.
Sincerely,
/s/ Timothy R. Schwertfeger
Timothy R. Schwertfeger
Chairman of the Board
June 15, 1999
"...Municipal supply in 1999 has declined... this has enhanced the
attractiveness of the municipal bonds that were brought to market."
3
<PAGE>
Report from the Portfolio Managers
Despite troubles in the global financial arena that led investors on a flight to
quality, the municipal market did not act out of the ordinary during the fiscal
year ended April 30, 1999. Rick Huber, portfolio manager of Nuveen Flagship All-
American Municipal Bond Fund and Nuveen Flagship Limited Term Municipal Bond
Fund, and Paul Brennan, portfolio manager of Nuveen Flagship Intermediate
Municipal Bond Fund, discuss the municipal bond market, as well as their funds'
performance and key investment strategies.
Comments cover the fiscal year ended April 30, 1999, and all performance
statistics are quoted for Class A shares at net asset value.
What economic factors affected the municipal market May 1, 1998 through April
30, 1999? The major news event of the funds' fiscal year was the foreign
markets' financial crises, which caused a surge in the global demand for U.S.
Treasury bonds--the world's most liquid and risk-free securities. This
phenomenon is commonly referred to as a "flight to quality." However, because
municipal bonds are not as attractive to foreign buyers, who generally cannot
take advantage of their tax-exempt feature, the big news in `98 had little
effect on the municipal market.
The Federal Reserve Board responded to the global crisis by lowering short-
term interest rates three times between late September and early November.
The Fed cuts succeeded in their objective and by early 1999, investor
sentiment improved and the crisis appeared to be over.
Stronger-than-expected U.S. economic growth led to a dramatic selloff in the
Treasury market in February, however, as concerns grew over the potential for
inflation, which has been unusually low in recent years. Municipal bonds
outperformed Treasury securities during the selloff.
Municipal issuance was strong during the funds' fiscal year, as issuers took
advantage of low interest rates. Because of higher supply and lower demand,
municipal bond yields exceeded taxable yields at times, making it a rewarding
asset class for investors. More typically, municipals yield about 86% of
comparably maturing Treasury bonds.
As the second quarter of 1999 approached, the foreign economic crises receded
further into the background, and the U.S. economy remained buoyant. However,
inflation fears became more prevalent as oil prices rebounded and the consumer
price index spiked upward, causing yields on most fixed-income securities to
rise.
Rick, what can you tell us about Nuveen Flagship All-American Municipal Bond
Fund's performance? For the fiscal year ended April 30, 1999, the total return
for Class A shares on net asset value was 6.23%, outperforming the 5.78% average
total return* of the Lipper General Municipal Bond Peer Group.** The fund ranked
74 out of 258 funds in the category.
Rick, how did Nuveen Flagship Limited Term Municipal Bond Fund perform during
its fiscal year? For the one-year period ended April 30, 1999, the total return*
for Class A shares on net asset value was 5.57%.
* Total return is the sum of the fund's income and capital gains distributions
plus price changes in the underlying bond portfolio.
**The Lipper Peer Group return represents the average annualized returns of the
funds in the applicable Lipper National Municipal Debt category. The return
assumes reinvestment of dividends and does not reflect any applicable sales
charge.
4
<PAGE>
To what do you attribute both funds' performance? The strong relative
performance of Nuveen Flagship All-American Municipal Bond Fund was due
primarily to our focus on the yield curve, which describes the yield available
on bonds at various maturities. We found value in securities that were at a
premium and were priced to call options. The benefit to the fund, and therefore
to its shareholders, is that these securities produced the greatest amount of
coupon return, which translates into price stability and higher distribution
yield.
Also a boost to the All-American Fund's performance during the last part of
the fiscal year was our purchase of some industrial-backed municipal bonds,
which we bought at attractive prices when much of the market perceived that
global economic weakness would bleed into the U.S. economy and hurt this sector.
This has not happened, and as a result, industrial-backed municipal bonds have
outperformed traditional tax-backed obligations.
In addition, the fund benefited from refunding activity. One such deal took
place in the first quarter of 1999. The Illinois Education Facilities Authority
for Columbia College bonds were refunded and are now backed by U.S. government
escrow securities. As a result, the bonds have appreciated in price.
The Limited Term Municipal Bond Fund benefited mainly from values we found in
private placements and limited public offerings, bonds that are offered to a
smaller group of buyers. Their more private nature involves increased risks, and
they therefore generally have offered higher yields than traditional public
offerings. Because there is less public information available on private deals,
we rely on our capable research team to help mitigate those risks by performing
extensive research on each potential issue.
What key strategies did you and your team use in managing the All-American
Municipal Bond Fund and the Limited Term Municipal Bond Fund? Our value-
investing philosophy of seeking undervalued sectors and bonds proved effective
during the year for both funds. For example, in the All-American Fund, we
purchased energy bonds when oil prices were particularly weak.
Why was the All-American Municipal Bond Fund's dividend reduced during this
period? In order to maintain the fund's long-term objective, we traded some of
the fund's existing bonds, which typically had higher coupon rates, as they
neared their maturity dates and purchased in their place bonds with later
maturity dates.
Because of current market conditions, namely the lower interest rates, the
newer bonds are earning less income for the fund than the older bonds had.
On the bright side, the new bonds offer better total return potential for the
fund.
Paul, what can you tell us about the Intermediate Municipal Bond Fund's
performance? The total return for Class A shares on net asset value for the
fiscal year ended April 30, 1999 was 6.14%, which exceeded the average total
return of 5.83% posted by the Lipper National Intermediate Municipal peer group.
The fund ranked 38 out of 134 funds in its peer group.
During the fiscal year, the intermediate bond sector was more affected by
falling interest rates than the long-term sector was since intermediates are
more highly correlated to short-term rates, which the Fed cut three times in the
fall.
We attribute the fund's strong performance primarily to our decision to keep
the portfolio's average duration longer than that of its peers'. A bond's
duration measures its price volatility, or reaction to interest rate movements.
The longer the duration, the more sensitive it is to changes in interest rates.
Virtually all of the bonds in our portfolio make fixed interest payments and
their prices rise when interest rates fall due to the inverse relationship of
bond prices and interest rates.
Also a boost to performance was our ability to take advantage of opportunities
to purchase a select amount of lower-rated investment-grade bonds with
relatively attractive yields. In many instances, these types of issues were only
offered to institutional investors like Nuveen. Further, Nuveen's seasoned
research staff helps identify the most appropriate opportunities for the fund.
5
<PAGE>
What were your key strategies in managing the Intermediate Municipal Bond Fund?
We worked to maintain the maturity structure of the portfolio, which includes
many noncallable bonds. The maturities within the portfolio become shorter over
time, and as they lose their intermediate-term status, we trade them in for
bonds with longer maturities, in the 11-12 year range, in order to maintain the
fund's investment objective as an intermediate-term bond fund.
Much like for the Limited Term and All-American funds, our value-investing
philosophy of trying to buy undervalued sectors and individual bonds proved
effective during the year. In addition to finding attractively priced lower-
rated bonds as I mentioned earlier, we have found value in the transportation,
water and sewer and education sectors.
The fund's weighting in Florida issues primarily reflects the merger of Nuveen
Flagship Florida Intermediate Municipal Bond Fund into Nuveen Flagship
Intermediate Municipal Bond Fund last fall. We plan to maintain this weighting
until we see any change in the Florida municipal market that would create a
beneficial selling opportunity.
Why was the Intermediate Municipal Bond Fund's dividend decreased during the
period? The combination of low interest rates, trading activity geared to
maintain the fund's intermediate-term focus, and new cash flow caused the fund
to reduce its dividend slightly. The fund's investment objective is to provide
as high a level of current interest income, exempt from regular federal, state
and in some cases, local income taxes, as is consistent with preservation of
capital. So there are two goals, income as well as total return.
The small reduction was necessary in keeping with the interests of
shareholders' total return investment objectives.
Rick and Paul, what is your outlook for the Nuveen Flagship municipal bond
funds? We expect U.S. Treasury rates will remain stable for the rest of 1999,
and that municipal bonds will trade in line with Treasuries, closer to their
historical levels.
The economy should continue to grow moderately in a stable manufacturing
environment.
As a result, prices on the lower-quality investment-grade securities should
firm up, providing the potential for continued relatively strong performance by
the funds.
We will continue our commitment to enhancing call protection on the funds and
keeping each fund true to its specific investment objectives. As always, we will
search for pockets of opportunity in the municipal market that will help us
maintain the funds' dividends and total returns.
With the strong economy, municipal bond funds continue to be a wise choice for
many investors. Many investors are searching for attractive fixed-income
opportunities. With municipals being one of the few tax-free selections left,
demand is growing. Supply is expected to be on course at the levels we have seen
in 1998. A tight supply and high level on demand will typically provide a stable
environment for investments.
"We will continue our commitment to enhancing call protection
on the funds and keeping each fund true to its
specific investment objectives."
6
<PAGE>
NUVEEN FLAGSHIP ALL-AMERICAN MUNICIPAL BOND FUND
Highlights as of April 30, 1999
<TABLE>
<CAPTION>
Quick Facts
A Shares B Shares C Shares R Shares
<S> <C> <C> <C> <C>
NAV $11.43 $ 11.44 $ 11.42 $ 11.44
- ---------------------------------------------------------------------------
April's Dividend $0.047 $0.0400 $0.0420 $0.0490
- ---------------------------------------------------------------------------
Fund Symbol FLAAX N/A FAACX N/A
- ---------------------------------------------------------------------------
CUSIP 67065Q889 67065Q871 67065Q863 67065Q855
- ---------------------------------------------------------------------------
Inception Date 10/88 2/97 6/93 2/97
- ---------------------------------------------------------------------------
Total Return (Annualized)/2/
A Shares B Shares C Shares R Shares
NAV Offer NAV NAV NAV
1-Year 6.23% 1.74% 5.46% 5.69% 6.54%
- -----------------------------------------------------------------------------------------
5-Year 7.70% 6.78% 7.04% 7.13% 7.82%
- -----------------------------------------------------------------------------------------
10-Year 8.48% 8.02% 8.02% 7.89% 8.54%
- -----------------------------------------------------------------------------------------
1-Year TER* 8.56% 3.97% 7.44% 7.77% 8.98%
</TABLE>
* Taxable Equivalent Return (31%)
/2/ Class A share returns are actual. Class B, C and R share returns are actual
for the period since class inception; returns prior to class inception are
Class A share returns adjusted for differences in sales charges and
expenses, which are primarily differences in distribution and service fees.
Class A shares have a 4.2% maximum sales charge. Class B shares have a CDSC
that begins at 5% for redemptions during the first year after purchase and
declines periodically to 0% over the following five years, which is not
reflected in the return figures. Class C shares have a 1% CDSC for
redemptions within one year which is not reflected in the one-year total
return.
Index Comparison/2/
[LINE CHART APPEARS HERE]
<TABLE>
<CAPTION>
Lehman Brothers Municipal Nuveen Flagship All-American Nuveen Flagship All-American
Bond Index Municipal Bond Fund (NAV) Municipal Bond Fund (Offer)
$21,803 $22,578 $21,630
- --------------------------------------------------------------------------------------------
<S> <C> <C>
10,000 10,000 9,580
- --------------------------------------------------------------------------------------------
10,720 10,560 10,110
- --------------------------------------------------------------------------------------------
11,950 11,850 11,350
- --------------------------------------------------------------------------------------------
13,090 13,180 12,630
- --------------------------------------------------------------------------------------------
14,740 15,190 14,550
- --------------------------------------------------------------------------------------------
15,060 15,580 14,930
- --------------------------------------------------------------------------------------------
16,060 16,540 15,840
- --------------------------------------------------------------------------------------------
17,340 17,800 17,050
- --------------------------------------------------------------------------------------------
18,650 19,260 18,460
- --------------------------------------------------------------------------------------------
20,390 21,250 20,360
- --------------------------------------------------------------------------------------------
21,803 22,578 21,630
- --------------------------------------------------------------------------------------------
</TABLE>
Monthly Tax-Free Dividends/4/ (Class A Shares)
[BAR CHART APPEARS HERE]
<TABLE>
<S> <C>
May .049
June .049
July .048
August .048
September .048
October .048
November .048
December .048
January .047
February .047
March .047
April .047
</TABLE>
* Nuveen Flagship All-American Municipal Bond Fund also paid shareholders
capital gains distribution in December of $0.0108 per share.
Past performance is not predictive of future results.
Morningstar Rating/TM 1/
****
Overall rating among 1579
municipal bond funds as
of 4/30/99.
Portfolio Statistics
Fund Net Assets $ 427 million
- ---------------------------------------------------
Effective Maturity 21.47 years
- ---------------------------------------------------
Average
Effective Duration 8.34
- ---------------------------------------------------
Top Five Sectors**
Utilities 20%
- ---------------------------------------------------
U.S. Guaranteed 14%
- ---------------------------------------------------
Transportation 13%
- ---------------------------------------------------
Health Care 13%
- ---------------------------------------------------
Education & Civic Organizations 9%
- ---------------------------------------------------
Bond Credit Quality**
[PIE CHART APPEARS HERE]
AAA/U.S.
Grtd...33%
AA.....10%
A......13%
BBB/
NR.....44%
**as a percentage of total bond holdings
Returns are historical and do not guarantee future performance. Investment
returns and principal value will fluctuate so that when shares are redeemed,
they may be worth more or less than original cost. Performance of classes will
differ. For additional information, please see the fund's prospectus.
/1/ Morningstar proprietary ratings reflect historical risk-adjusted performance
as of 04/30/99. The ratings are subject to change every month. Ratings are
for the A share class only; other classes may vary. Past performance is no
guarantee of future results. Morningstar ratings are calculated form the
fund's three-, five-, and 10-year average annual returns (if applicable) in
excess of 90-day T-bill returns. All-American received 4 stars for the
three-, five-, and 10 year periods. The top 10% of the funds in a broad
asset class receive 5 stars, the next 22.5% receive 4 stars and the next 35%
receive 3 stars. The funds were rated among 1579, 1151, and 367 funds for
the three-, five-, and 10-year periods respectively.
/3/ The Index Comparison shows the change in value of a $10,000 investment in
the Class A shares of the Nuveen fund compared with the Lehman Brothers
Municipal Bond Index. The Lehman Brothers Municipal Bond Index is comprised
of a broad range of investment-grade municipal bonds, and does not reflect
any initial or ongoing expenses. The Nuveen fund return depicted in the
chart reflects the initial maximum sales charge applicable to A shares
(4.20%) and all ongoing fund expenses.
7
<PAGE>
NUVEEN FLAGSHIP INTERMEDIATE MUNICIPAL BOND FUND
Highlights as of April 30, 1999
<TABLE>
<CAPTION>
Quick Facts
A Shares C Shares R Shares
<S> <C> <C> <C>
NAV $11.00 $ 11.02 $ 10.99
- ---------------------------------------------------------------------------
April's Dividend $ 0.04 $0.0350 $0.0415
- ---------------------------------------------------------------------------
Fund Symbol FINTX FINCX N/A
- ---------------------------------------------------------------------------
CUSIP 67065Q814 67065Q798 67065Q780
- ---------------------------------------------------------------------------
Inception Date 9/92 12/95 2/97
- ---------------------------------------------------------------------------
Total Return (Annualized)/1/
A Shares C Shares R Shares
NAV Offer NAV NAV
1-Year 6.14% 2.93% 5.66% 6.42%
- ------------------------------------------------------------------------------------
5-Year 6.84% 6.19% 6.29% 6.90%
- ------------------------------------------------------------------------------------
Since Inception 7.08% 6.59% 6.52% 7.13%
- ------------------------------------------------------------------------------------
1-Year TER* 8.24% 4.96% 7.50% 8.60%
</TABLE>
* Taxable Equivalent Return (31%)
/1/ Class A share returns are actual. Class C and R share returns are actual for
the period since class inception; returns prior to class inception are Class
A share returns adjusted for differences in sales charges and expenses,
which are primarily differences in distribution and service fees. Class A
shares have a 3.0% maximum sales charge. Class C shares have a 1% CDSC for
redemptions within one year which is not reflected in the one-year total
return.
Index Comparison/2/
[LINE CHART APPEARS HERE]
<TABLE>
<CAPTION>
Nuveen Flagship Nuveen Flagship
Lehman Brothers 7-year Intermediate Municipal Intermediate Municipal
Municipal Bond Index Bond Fund (NAV) Bond Fund (Offer)
$15,036 $15,693 $15,223
- ---------------------- ---------------------- ----------------------
<S> <C> <C>
10,000 10,000 9,700
10,550 10,920 10,600
10,880 11,280 10,940
11,520 11,810 11,460
12,390 12,720 12,340
13,050 13,570 13,160
14,080 14,790 14,340
15,036 15,693 15,223
</TABLE>
Monthly Tax-Free Dividends (Class A Shares)/3/
[BAR CHART APPEARS HERE]
<TABLE>
<CAPTION>
<S> <C>
May .042
June .042
July .042
August .042
September .0422
October .042
November .042
December .042
January .040
February .040
March .040
April .040
</TABLE>
/3/ The fund also paid shareholders capital gains distributions in December of
$0.0442 per share.
Past performance is not predictive of future results.
Portfolio Statistics
<TABLE>
<CAPTION>
<S> <C>
Fund Net Assets $62 million
- --------------------------------------------------------------
Effective Maturity 9.06 years
- --------------------------------------------------------------
Average
Effective Duration 7.16
- --------------------------------------------------------------
Top Five Sectors**
Health Care 20%
- --------------------------------------------------------------
Transportation 16%
- --------------------------------------------------------------
Tax Obligation (Limited) 14%
- --------------------------------------------------------------
Tax Obligation (General) 12%
- --------------------------------------------------------------
Utilities 11%
- --------------------------------------------------------------
</TABLE>
[PIE CHART APPEARS HERE]
Bond Credit Quality**
AAA/U.S.
Grtd...........36%
AA..............6%
A..............17%
BBB/
NR.............41%
**as a percentage of total bond holdings
Returns are historical and do not guarantee future performance. Investment
returns and principal value will fluctuate so that when shares are redeemed,
they may be worth more or less than original cost. Performance of classes will
differ. For additional information, please see the fund's prospectus.
/2/ The Index Comparison shows the change in value of a $10,000 investment in
the Class A shares of the Nuveen fund compared with the Lehman Brothers
7-Year Municipal Bond Index. The Lehman Brothers Municipal Bond Index is
comprised of a broad range of investment-grade municipal bonds, and does not
reflect any initial or ongoing expenses. The Nuveen fund return depicted in
the chart reflects the initial maximum sales charge applicable to A shares
(3%) and all ongoing fund expenses.
8
<PAGE>
NUVEEN FLAGSHIP LIMITED TERM MUNICIPAL BOND FUND
Highlights as of April 30, 1999
<TABLE>
<CAPTION>
- --------------------------------------------------------------------
Quick Facts
- --------------------------------------------------------------------
A Shares C Shares R Shares
<S> <C> <C> <C>
NAV $ 10.89 $ 10.87 $ 10.87
- --------------------------------------------------------------------
April's Dividend $0.0405 $0.0375 $0.0425
- --------------------------------------------------------------------
Fund Symbol FLTDX FLTCX N/A
- --------------------------------------------------------------------
CUSIP 67065Q848 67065Q830 67065Q822
- --------------------------------------------------------------------
Inception Date 10/87 12/95 2/97
- --------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------
Total Return (Annualized)/2/
- --------------------------------------------------------------------
A Shares C Shares R Shares
NAV Offer NAV NAV
<S> <C> <C> <C> <C>
1-Year 5.57% 2.90% 5.13% 5.81%
- --------------------------------------------------------------------
5-Year 5.41% 4.88% 5.04% 5.47%
- --------------------------------------------------------------------
10-Year 6.52% 6.26% 6.18% 6.55%
- --------------------------------------------------------------------
1-Year TER* 7.70% 4.98% 7.11% 8.05%
</TABLE>
* Taxable Equivalent Return (31%)
/2/ Class A share returns are actual. Class C and R share returns are actual
for the period since class inception; returns prior to class inception are
Class A share returns adjusted for differences in sales charges and
expenses, which are primarily differences in distribution and service fees.
Class A shares have a 2.5% maximum sales charge. Class C shares have a 1%
CDSC for redemptions within one year which is not reflected in the one-year
total return.
- ---------------------------------------
Index Comparison/3/
- ---------------------------------------
[LINE CHART APPEARS HERE]
<TABLE>
<CAPTION>
Nuveen Flagship Nuveen Flagship
Lehman Brothers 5-Year Limt'd Municipal Limt'd Municipal
Municipal Bond Index Bond Fund (NAV) Bond Fund (Offer)
$19,724 $18,812 $18,341
- ---------------------- ---------------------- ----------------------
<S> <C> <C>
10,000 10,000 9,750
10,740 10,700 10,430
11,950 11,650 11,360
12,970 12,680 12,360
14,280 14,010 13,660
14,710 14,460 14,100
15,510 15,040 14,660
16,580 15,940 15,540
17,350 16,700 16,290
18,520 17,820 17,370
19,724 18,812 18,341
</TABLE>
- ----------------------------------------------
Monthly Tax-Free Dividends (Class A Shares)/4/
- ----------------------------------------------
[BAR CHART APPEARS HERE]
<TABLE>
<CAPTION>
<S> <C>
May .0425
June .0425
July .0425
August .0425
September .0425
October .0425
November .0425
December .0425
January .0405
February .0405
March .0405
April .0405
</TABLE>
/4/ Nuveen Flagship Limited Term Municipal Bond Fund also paid shareholders net
ordinary income distributions in December of $0.00008.
Past performance is not predictive of future results.
- ---------------------------------------
Morningstar Rating/TM/ /1/
- ---------------------------------------
****
Overall rating among 1579
municipal bond funds as
of 4/30/99.
- ---------------------------------------
Portfolio Statistics
- ---------------------------------------
Fund Net Assets $545 million
- ---------------------------------------
Effective Maturity 4.97 years
- ---------------------------------------
Average
Effective Duration 4.61
- ---------------------------------------
- ---------------------------------------
Top Five Sectors**
- ---------------------------------------
Utilities 22%
- ---------------------------------------
Health Care 17%
- ---------------------------------------
Education & Civic Organizations 13%
- ---------------------------------------
U.S. Guaranteed 9%
- ---------------------------------------
Tax Obligation (Limited) 9%
- ---------------------------------------
- ---------------------------------------
Bond Credit Quality**
- ---------------------------------------
[PIE CHART APPEARS HERE]
AAA/U.S.
Grtd...37%
AA......6%
A......23%
BBB/
NR.....34%
**as a percentage of total bond holdings
Returns are historical and do not guarantee future performance. Investment
returns and principal value will fluctuate so that when shares are redeemed,
they may be worth more or less than original cost. Performance of classes will
differ. For additional information, please see the fund's prospectus.
/1/ Morningstar proprietary ratings reflect historical risk-adjusted
performance as of 04/30/99. The ratings are subject to change every month.
Ratings are for the A share class only; other classes may vary. Past
performance is no guarantee of future results. Morningstar ratings are
calculated form the fund's three-, five-, and 10-year average annual
returns (if applicable) in excess of 90-day T-bill returns. Limited-Term
received 3 stars, 4 stars, 5 stars for the three-, five-, and 10-year
periods respectively. The top 10% of the funds in a broad asset class
receive 5 stars, the next 22.5% receive 4 stars and the next 35% receive 3
stars. The funds were rated among 1579, 1151, and 367 funds for the three-,
five-, and 10-year periods respectively.
/3/ The Index Comparison shows the change in value of a $10,000 investment in
the Class A shares of the Nuveen fund compared with the Lehman Brothers
5-Year Municipal Bond Index. The Lehman Brothers Municipal Bond Index is
comprised of a broad range of investment-grade municipal bonds, and does
not reflect any initial or ongoing expenses. The Nuveen fund return
depicted in the chart reflects the initial maximum sales charge applicable
to A shares (2.50%) and all ongoing fund expenses.
9
<PAGE>
Portfolio of Investments
Nuveen Flagship All-American Municipal Bond Fund
April 30, 1999
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Alabama - 0.9%
$ 25,000 Alabama Housing Finance Authority, Single Family Mortgage 4/04 at 102 Aaa $ 26,940
Revenue Bonds (Collateralized Home Mortgage Revenue Bond
Program), 1994 Series A-1 Bonds, 6.600%, 4/01/19
200,000 Alabama State Docks Department, Docks Facilities Revenue Bonds, 10/06 at 102 AAA 219,466
Series 1996, 6.100%, 10/01/13 (Alternative Minimum Tax)
100,000 Alabama State Docks Department, Docks Facilities Revenue Bonds, 10/07 at 102 AAA 102,319
Series 1997, 5.375%, 10/01/17 (Alternative Minimum Tax)
50,000 Alabama Public School and College Authority, Refunding Bonds, No Opt. Call AA 53,530
Series 1993A, 6.000%, 8/01/02
400,000 The Utilities Board of the City of Bayou La Batre (Alabama), 3/07 at 102 AA 420,672
Water and Sewer Revenue Refunding and Improvement Bonds,
Series 1997, 5.750%, 3/01/27
150,000 The Special Care Facilities Financing Authority of the City of 6/07 at 102 AAA 155,697
Birmingham, Children's Hospital, Health Care Facility
Revenue Bonds, Series 1997, 5.500%, 6/01/22
200,000 The Special Care Facilities Financing Authority of the City of 8/05 at 102 AAA 212,930
Birmingham, Carraway Revenue Bonds, Series 1995A (Carraway
Methodist Health Systems), 5.875%, 8/15/15
150,000 The Private Educational Building Authority of the City of 6/06 at 102 A3 159,207
Birmingham (Alabama), Birmingham - Southern College Tuition
Revenue Bonds, Series 1996, 6.000%, 12/01/21
150,000 Clarke-Mobile Counties Gas District (Alabama), Gas Revenue 12/06 at 102 AAA 158,501
Bonds, Series 1996, 5.600%, 12/01/17
100,000 The Colbert County-Northwest Alabama Health Care Authority, 6/05 at 102 AAA 106,887
Health Care Facilities Revenue Bonds, Series 1995
(Helen Keller Hospital), 5.750%, 6/01/15
100,000 The Industrial Development Board of the Town of Courtland 9/05 at 102 Baa1 107,310
(Alabama), Solid Waste Disposal Revenue Bonds (Champion
International Corporation Project), Series 1995A, 6.500%,
9/01/25 (Alternative Minimum Tax)
90,000 City of Huntsville, Alabama, Electric System Revenue Warrants, 12/03 at 102 AA 99,146
Series 1994, 6.100%, 12/01/10
25,000 The Health Care Authority of the City of Huntsville (Alabama), 6/04 at 102 AAA 28,351
Health Care Facilities Revenue Bonds, Series 1992-B, 6.500%,
6/01/13 (Pre-refunded to 6/01/04)
100,000 The Huntsville-Madison County Airport Authority, Airport Revenue 1/07 at 102 AAA 101,429
Bonds, Series 1997, 5.400%, 7/01/19 (Alternative Minimum Tax)
100,000 Jefferson County (Alabama), Sewer Revenue Refunding Warrants, 2/07 at 101 AAA 105,209
Series 1997-A, 5.625%, 2/01/22
100,000 Jefferson County (Alabama), Sewer Revenue Warrants, Series 2/07 at 101 AAA 106,955
1997-D, 5.750%, 2/01/27
100,000 The Health Care Authority of Lauderdale County and the City of 7/06 at 102 AAA 105,643
Florence (Alabama), Revenue Refunding Bonds, Series 1996
(Eliza Coffee Memorial Hospital), 5.750%, 7/01/19
180,000 City of Mobile (Alabama), General Obligation Refunding Warrants, 2/06 at 102 AAA 192,733
Series 1996, 5.750%, 2/15/16
200,000 Northport Alabama, WTS, Series A, 5.700%, 3/01/21 3/06 at 102 AAA 212,780
500,000 The Industrial Development Board of the City of Phoenix City 4/08 at 102 A- 486,140
(Alabama), Environmental Improvement Revenue Refunding Bonds
(Mead Coated Board Project), Series 1998A, 5.300%, 4/01/27
(Alternative Minimum Tax)
125,000 Prichard, Alabama, Waterworks and Sewer Board, Water and Sewer 11/04 at 102 AAA 138,605
Revenue Refunding, 6.125%, 11/15/14
250,000 The Industrial Development Board of the City of Tallassee, 8/06 at 102 A1*** 281,688
Alabama, Industrial Revenue Bonds, Dow-United Technologies
Composite Products, Series 1996-A, 6.100%, 8/01/14
(Pre-refunded to 8/01/06)
200,000 Troy State University (Alabama), Special Limited Obligation 6/07 at 103 AAA 213,144
Revenue Bonds (Troy City University/City of Troy Project),
Series 1997, 5.650%, 6/01/27
110,000 University of South Alabama, University Tuition Revenue 5/06 at 102 AAA 110,993
Refunding and Capital Improvement Bonds, Series 1996,
5.000%, 11/15/15
</TABLE>
10
<PAGE>
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Alaska - 1.2%
$ 5,000,000 Alaska Industrial Development and Export Authority, Revolving 4/08 at 101 AAA $4,942,700
Fund Refunding Bonds, Series 1998A, 5.250%, 4/01/23
(Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Arizona - 1.2%
2,500,000 The Industrial Development Authority of the County of Maricopa 7/08 at 101 A 2,420,100
(Arizona), Health Facility Revenue Bonds (Catholic Healthcare
West Project), 1998 Series A, 5.000%, 7/01/21
2,500,000 The Industrial Development Authority of the County of Yavapai 6/07 at 101 AA- 2,566,425
(Arizona), Industrial Development Revenue Bonds, 1998 Series
(Citizens Utilities Company Project), 5.450%, 6/01/33
(Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
California - 9.4%
5,000,000 California Health Facilities Financing Authority, Insured 7/07 at 102 AAA 5,281,100
Refunding Revenue Bonds (Pomona Valley Hospital Medical Center),
1997 Series A, 5.625%, 7/01/19
2,000,000 California Pollution Control Financing Authority, Pollution No Opt. Call A-1 2,242,180
Control Refunding Revenue Bonds (San Diego Gas and Electric Company),
1996 Series A, 5.900%, 6/01/14
5,000,000 California Statewide Communities Development Authority, Special 10/07 at 102 Baa3 5,156,300
Facilities Lease Revenue Bonds, 1997 Series A, 5.700%, 10/01/33
(Alternative Minimum Tax)
7,500,000 California Statewide Communities Development Authority, 4/09 at 101 BBB 7,361,025
Certificates of Participation, The Internext Group, 5.375%, 4/01/30
8,000,000 Contra Costa Home Mortgage Finance Authority, California, 1984 No Opt. Call AAA 3,223,040
Home Mortgage Revenue Bonds, 0.000%, 9/01/17
2,000,000 Foothill/Eastern Transportation Corridor Agency, California, No Opt. Call BBB- 1,576,160
Toll Road Revenue Bonds, Series 1995A, 0.000%, 1/01/05
7,000,000 Long Beach Aquarium of the Pacific Revenue Bonds (Aquarium of 7/05 at 102 BBB 7,385,420
the Pacific Project), 1995 Series A, 6.125%, 7/01/23
4,000,000 Regional Airports Improvement Corporation, Facilities Sublease 5/06 at 102 BBB- 4,318,320
Refunding Revenue Bonds, Issue of 1996, Delta Air Lines, Inc.
(Los Angeles International Airport), 6.350%, 11/01/25
Sacramento Cogeneration Authority, Cogeneration Project Revenue Bonds
(Procter & Gamble Project), 1995 Series:
500,000 6.200%, 7/01/06 7/05 at 102 BBB- 552,365
1,000,000 6.500%, 7/01/21 (Pre-refunded to 7/01/05) 7/05 at 102 N/R*** 1,153,160
2,000,000 Taft Public Financing Authority, Lease Revenue Bonds, 1997 1/07 at 101 A2 2,119,060
Series A (Community Correctional Facility Acquisition Project),
6.050%, 1/01/17
- ------------------------------------------------------------------------------------------------------------------------------------
Colorado - 4.3%
E-470 Public Highway Authority, Capital Improvement Trust Fund Highway
Revenue Bonds (E-470 Project), Senior Bonds:
6,000,000 0.000%, 8/31/05 No Opt. Call Aaa 4,619,880
2,000,000 6.950%, 8/31/20 (Pre-refunded to 8/31/05) 8/05 at 103 Aaa 2,376,880
11,800,000 Colorado Health Facilities Authority, Retirement Facilities No Opt. Call Aaa 3,399,226
(Liberty Heights), 0.000%, 7/15/22
5,000,000 City and County of Denver, Colorado, Airport System Revenue Bonds, 11/07 at 101 AAA 5,066,550
Series 1997E, 5.250%, 11/15/23
2,500,000 Hyland Hills Park and Recreation District, Adams County, Colorado 12/06 at 101 N/R 2,709,625
Special Revenue Refunding and Improvement Bonds, Series 1996A,
6.750%, 12/15/15
- ------------------------------------------------------------------------------------------------------------------------------------
Connecticut - 2.0%
2,500,00 0 State of Connecticut Health and Educational Facilities Authority, 7/07 at 102 BBB 2,440,350
Revenue Bonds, Hospital for Special Care Issue,
Series B, 5.500%, 7/01/27
2,000,000 State of Connecticut Health and Educational Facilities Authority, 11/04 at 102 AAA 2,349,560
Revenue Bonds, Nursing Home Program Issue, Series 1994,
AHF/Hartford, Inc. Project, 7.125% 11/01/14
3,305,000 State of Connecticut Health and Educational Facilities Authority, No Opt. Call AAA 3,550,099
Revenue Bonds, Trinity College Issue, Series F, 5.500%, 7/01/21
</TABLE>
11
<PAGE>
Portfolio of Investments
Nuveen Flagship All-American Municipal Bond Fund (continued)
April 30, 1999
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Delaware - 0.4%
$ 1,750,000 Delaware Economic Development Authority, First Mortgage Revenue D5/07 at 102 BBB $ 1,841,473
Bonds (Peninsula United Methodist Homes, Inc. Issue), Series 1997A,
6.300%, 5/01/22
- -----------------------------------------------------------------------------------------------------------------------------------
District of Columbia-0.4%
1,480,000 District of Columbia, University Revenue Bonds (Georgetown University 10/99 at 102 A2 1,514,217
Issue), Series 1990B, 7.150%, 4/01/21
- -----------------------------------------------------------------------------------------------------------------------------------
Florida - 1.9%
1,000,000 Town of Lady Lake, Florida, Industrial Development Revenue Bonds 7/00 at 102 N/R*** 1,088,360
(Sunbelt Utilities, Inc. Project), Series 1990, 9.625%, 7/01/15
(Alternative Minimum Tax) to (Pre-refunded 7/01/00)
1,945,000 Nassau County, Florida (GF/Amelia Island Properties, Inc. Project), 1/03 at 103 N/R 2,211,757
ICF/MR Revenue Bonds, Series 1993A, 9.750%, 1/01/23
1,750,000 Polk County Industrial Development Authority (Florida), Solid Waste 12/06 at 102 A-1+ 1,864,170
Disposal Facility Revenue Bonds (Tampa Electric Company Project),
Series 1996, 5.850%, 12/01/30 (Alternative Minimum Tax)
1,965,000 Sanford Airport Authority (Florida), Industrial Development Revenue 5/06 at 102 N/R 2,091,428
Bonds (Central Florida Terminals Inc. Project), Series 1995A,
7.500%, 5/01/10 (Alternative Minimum Tax)
645,000 Sanford Airport Authority (Florida), Industrial Development Revenue 5/07 at 102 N/R 673,909
Bonds (Central Florida Terminals Inc. Project), Series 1997C,
7.500%, 5/01/21
- -----------------------------------------------------------------------------------------------------------------------------------
Georgia - 1.2%
2,000,000 Brunswick and Glynn County Development Authority, Revenue Refunding 3/08 at 102 Baa2 1,997,340
Bonds, Series 1998 (Georgia Pacific Corporation Project),
5.550%, 3/01/26 (Alternative Minimum Tax)
2,000,000 Municipal Electric Authority of Georgia, General Power Revenue No Opt. Call A 2,128,460
Bonds, 1993C Series, 5.700%, 1/01/19
1,000,000 Municipal Electric Authority of Georgia, Project One Special Obligation No Opt. Call A+ 1,167,440
Bonds, Fifth Crossover Series Y, 6.500%, 1/01/17
- -----------------------------------------------------------------------------------------------------------------------------------
Illinois - 6.9%
7,400,000 Chicago School Reform Board of Trustees of the Board of Education No Opt. Call AAA 1,305,730
of the City of Chicago, Illinois, Unlimited Tax General Obligation
Bonds (Dedicated Tax Revenues), Series 1999A, 0.000%, 12/01/31
1,750,000 City of Chicago, Illinois, Gas Supply Revenue Bonds, 1990 Series A 5/00 at 102 AA- 1,858,290
(The People's Gas Light and Coke Company Project), 8.100%, 5/01/20
(Alternative Minimum Tax)
1,000,000 City of Chicago, Illinois, Gas Supply Refunding Revenue Bonds, 1995 6/05 at 102 AA- 1,083,670
Series A (The People's Gas Light and Coke Company Project),
6.100%, 6/01/25
2,000,000 Public Building Commission of Chicago, Illinois, Building Revenue No Opt. Call AAA- 2,075,880
Refunding Bonds, Series B of 1999 (Chicago School Reform Board of
Trustees of the Board of Education of the City of Chicago, Illinois),
5.250%, 12/01/18
2,000,000 Illinois Development Finance Authority (The Presbyterian Home Lake 9/06 at 102 AA- 2,207,180
Forest Place Project), Revenue Bonds, Series 1996B, 6.300%, 9/01/22
3,750,000 Illinois Educational Facilities Authority, Revenue Refunding Bonds, 7/01 at 102 A1*** 4,088,100
Loyola University of Chicago, Series 1991-A, 7.125%, 7/01/21
(Pre-refunded to 7/01/01)
Illinois Educational Facilities Authority, Revenue Refunding Bonds,
Columbia College, Series 1992:
2,815,000 6.875%, 12/01/17 (Pre-refunded to 12/01/04) 12/04 at 100 N/R*** 3,209,635
1,185,000 6.875%, 12/01/17 12/04 at 100 BBB 1,297,196
2,000,000 Illinois Health Facilities Authority, Revenue Refunding Bonds, 8/06 at 102 N/R 2,174,400
Series 1995A (Fairview Obligated Group), 7.125%, 8/15/17
6,000,000 Illinois Health Facilities Authority, Revenue Refunding Bonds, 2/07 at 102 A- 6,123,240
Series 1996B (Sarah Bush Lincoln Health Center), 5.750%, 2/15/22
4,000,000 Illinois Health Facilities Authority, Revenue Bonds, Series 1997A 8/07 at 101 A- 4,029,640
(Victory Health Service), 5.750%, 8/15/27
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
12
<PAGE>
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- -----------------------------------------------------------------------------------------------------------------------------------
<C> <S> <C> <C> <C>
Indiana - 4.7%
$ 2,000,000 City of Goshen, Indiana, Revenue Refunding Bonds, Series 1998 8/08 at 101 N/R $ 1,933,880
(Greencroft Obligated Group), 5.750%, 8/15/28
1,750,000 Indiana Health Facility Financing Authority, Hospital Revenue Bonds, 8/00 at 102 N/R*** 1,886,063
Series 1990 (Hancock Memorial Hospital Project), 8.300%, 8/15/20
(Pre-refunded to 8/15/00)
4,000,000 The Trustees of Indiana University, Indiana University Student Fee Bonds, No Opt. Call AAA 2,226,240
Series K, 0.000%, 8/01/11
2,000,000 Indianapolis Airport Authority, Special Facilities Revenue Bonds, 7/04 at 102 BBB 2,231,480
Series 1994 (Federal Express Corporation Project), 7.100%, 1/15/17
(Alternative Minimum Tax)
4,000,000 Indianapolis Airport Authority, Specialty Facility Revenue Bonds, 11/05 at 102 Baa2 4,333,000
Series 1995A (United Airlines, Inc., Indianapolis Maintenance Center
Project), 6.500%, 11/15/31 (Alternative Minimum Tax)
5,450,000 City of Indianapolis, Indiana, Economic Development Revenue 7/06 at 102 BBB 5,765,446
Bonds (Willowbrook Apartments Project), Senior Series 1996A,
6.500%, 7/01/26
500,000 Hospital Authority of Monroe County (Indiana), Hospital Revenue Bonds, 5/02 at 101 AAA 547,410
Series 1992 (Bloomington Hospital Project), 6.700%, 5/01/12
(Pre-refunded to 5/01/02)
1,000,000 Rockport Pollution Control (Indiana Michigan Power Company), 3/01 at 102 Baa2 1,063,420
7.600%, 3/01/16
- -----------------------------------------------------------------------------------------------------------------------------------
Kentucky - 5.8%
5,000,000 City of Ashland, Kentucky, Sewage and Solid Waste Revenue Bonds, 2/05 at 102 Baa1 5,616,050
Series 1995 (Ashland Inc. Project), 7.125%, 2/01/22
(Alternative Minimum Tax)
5,000,000 County of Henderson, Kentucky, Solid Waste Disposal Revenue Bonds 3/05 at 102 Baa2 5,355,050
(MacMillan Bloedel Project), Series 1995, 7.000%, 3/01/25
(Alternative Minimum Tax)
4,500,000 Jefferson County, Kentucky, Capital Projects Corporation, Lease No Opt. Call A+ 2,331,180
Revenue Bonds, Series 1992A, 0.000%, 8/15/12
2,000,000 Kentucky Economic Development Finance Authority, Hospital System 4/08 at 102 BBB 2,023,180
Refunding and Improvement Revenue Bonds, Series 1997 (Appalachian
Regional Healthcare, Inc. Project), 5.875%, 10/01/22
5,000,000 Louisville and Jefferson County Metropolitan Sewer District (Commonwealth 11/04 at 102 AAA 5,791,450
of Kentucky), Sewer and Drainage System Revenue Bonds, Series 1994A,
6.750%, 5/15/25
3,500,000 Pendleton County, Kentucky, County Lease Revenue Bonds, Kentucky 3/03 at 102 A 3,719,240
Associated Counties Leasing Trust Program, Series 1993-A,
6.500%, 3/01/19
- -----------------------------------------------------------------------------------------------------------------------------------
Louisiana - 0.5%
2,000,000 City of New Orleans Audubon Park Commission, Aquarium Revenue Bonds, 4/02 at 102 N/R*** 2,264,900
Series 1992, 8.000%, 4/01/12 (Pre-refunded to 4/01/02)
- -----------------------------------------------------------------------------------------------------------------------------------
Maryland - 1.1%
2,500,000 Community Development Administration, Maryland Department of Housing and 3/09 at 101 Aa2 2,496,050
Community Development, Residential Revenue Bonds, 1998 Series D,
5.250%, 9/01/29 (Alternative Minimum Tax)
2,000,000 Maryland Energy Financing Administration, Limited Obligation Solid Waste 12/06 at 102 A 2,181,400
Disposal Revenue Bonds (Wheelabrator Water Technologies Baltimore L.L.C.
Projects), 1996 Series, 6.450%, 12/01/16 (Alternative Minimum Tax)
- -----------------------------------------------------------------------------------------------------------------------------------
Massachusetts - 4.2%
5,000,000 Massachusetts Bay Transportation Authority, General Transportation System 3/07 at 101 AA 4,833,000
Bonds, 1998 Series B, 5.000%, 3/01/28
3,000,000 Massachusetts Health and Educational Facilities Authority, Revenue Bonds, 7/09 at 101 AA 2,929,770
Partners HealthCare System Issue, Series B, 5.125%, 7/01/19
2,000,000 Massachusetts Port Authority, Revenue Bonds, Series 1997-B, 7/07 at 101 AA 2,013,860
5.375%, 7/01/27 (Alternative Minimum Tax)
3,000,000 Massachusetts Industrial Finance Agency, Resource Recovery Revenue 12/08 at 102 BBB 3,006,180
Refunding Bonds (Ogden Haverhill Project), Series 1998A, 5.600%,
12/01/19 (Alternative Minimum Tax)
5,000,000 Massachusetts Housing Finance Authority, Single Family Housing Revenue 6/08 at 101 AAA 5,081,500
Bonds, Series 59, 5.500%, 12/01/30 (Alternative Minimum Tax)
</TABLE>
13
<PAGE>
Portfolio of Investments
Nuveen Flagship All-American Municipal Bond Fund (continued)
April 30, 1999
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Michigan - 2.0%
$ 2,000,000 Michigan State Hospital Finance Authority, Hospital Revenue and 10/08 at 101 BBB $ 1,955,580
Refunding Bonds (Genesys Regional Medical Center Obligated
Group), Series 1998A, 5.500%, 10/01/18
5,000,000 Michigan State Hospital Finance Authority, Hospital Revenue 8/08 at 101 BBB- 4,570,800
Bonds (The Detroit Medical Center Obligated Group),
Series 1998A, 5.250%, 8/15/23
2,000,000 Pontiac, Michigan, Hospital Finance Authority, Hospital Revenue 8/03 at 102 BBB- 2,030,980
Refunding (Nomc Obligation Group), 6.000%, 8/01/13
- ------------------------------------------------------------------------------------------------------------------------------------
Mississippi - 0.5%
2,000,000 Claiborne County, Mississippi, Pollution Control Revenue 5/00 at 102 BBB 2,088,940
Refunding Bonds (System Energy Resources, Inc. Project),
Series 1995, 7.300%, 5/01/25
- ------------------------------------------------------------------------------------------------------------------------------------
Missouri - 0.7%
3,000,000 Missouri State Development Finance Board, Solid Waste Disposal No Opt. Call AA 2,988,540
Revenue Bonds (Procter & Gamble Paper Products Company
Project), Series 1999, 5.200%, 3/15/29 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
New Hampshire - 0.3%
700,000 New Hampshire Higher Educational and Health Facilities 7/99 at 100 A- 702,135
Authority, Hospital Revenue Bonds, Catholic Medical Center
Issue, Series 1989, 6.000%, 7/01/17
600,000 New Hampshire Higher Educational and Health Facilities 1/01 at 102 A- 630,672
Authority, Hospital Revenue Bonds, St. Joseph Hospital
Issue, Series 1991, 7.500%, 1/01/16
- ------------------------------------------------------------------------------------------------------------------------------------
New Jersey - 1.1%
425,000 The Essex County Improvement Authority (Essex County, New 4/04 at 102 BBB+ 462,825
Jersey), City of Newark General Obligation Lease Revenue Bonds,
Series 1994, 6.600%, 4/01/14
2,400,000 New Jersey Economic Development Authority, Electric Energy 6/02 at 102 N/R 2,586,696
Facility Revenue Bonds (Vineland Cogeneration Limited Partnership
Project), Series 1992, 7.875%, 6/01/19 (Alternative Minimum Tax)
1,375,000 New Jersey Economic Development Authority, Insured Revenue Bonds 5/05 at 102 AAA 1,554,836
(Educational Testing Service Issue), Series 1995B, 6.125%,
5/15/15 (Pre-refunded to 5/15/05)
- ------------------------------------------------------------------------------------------------------------------------------------
New York - 13.4%
1,900,000 The City of New York, General Obligation Bonds, Fiscal 1992 2/02 at 101 1/2 A- 2,098,835
Series B, 7.500%, 2/01/09
The City of New York, General Obligation Bonds, Fiscal 1992
Series D:
685,000 7.500%, 2/01/17 (Pre-refunded to 2/01/02) 2/02 at 101 1/2 Aaa 762,816
750,000 7.500%, 2/01/18 (Pre-refunded to 2/01/02) 2/02 at 101 1/2 Aaa 835,200
The City of New York, General Obligation Bonds, Fiscal 1997
Series I:
1,490,000 6.250%, 4/15/27 (Pre-refunded to 4/15/07) 4/07 at 101 A-*** 1,704,947
1,510,000 6.250%, 4/15/27 4/07 at 101 A- 1,667,418
1,750,000 New York City Housing Development Corporation, Multi-Unit 6/01 at 102 AAA 1,885,888
Mortgage Refunding Bonds (FHA-Insured Mortgage Loans),
1991 Series A, 7.350%, 6/01/19
3,000,000 New York City Industrial Development Agency, Special Facility 8/07 at 102 Baa1 3,029,880
Revenue Bonds (1990 American Airlines, Inc. Project), 5.400%,
7/01/20 (Alternative Minimum Tax)
5,500,000 New York City Industrial Development Agency, Special Facility 12/08 at 102 A 5,439,775
Revenue Bonds, Series 1998 (British Airways PLC Project),
5.250%, 12/01/32 (Alternative Minimum Tax)
1,480,000 Dormitory Authority of the State of New York, City University No Opt. Call BBB+ 1,607,117
System Consolidated Second General Resolution Revenue Bonds,
Series 1993A, 5.750%, 7/01/18
2,500,000 Dormitory Authority of the State of New York, Department of 7/05 at 102 AAA 2,887,925
Health of the State of New York Revenue Bonds, Series 1995,
6.625%, 7/01/24 (Pre-refunded to 7/01/05)
3,200,000 Dormitory Authority of the State of New York, Upstate Community No Opt. Call BBB+ 3,064,896
Colleges Revenue Bonds, Series 1999A, 5.000%, 7/01/28
3,000,000 New York State Energy Research and Development Authority, 11/08 at 102 AAA 2,997,840
Pollution Control Revenue Refunding Bonds (Niagara Mohawk
Power Corporation Project), Series 1998A, 5.150%, 11/01/25
</TABLE>
14
<PAGE>
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
New York (continued)
$ 3,000,000 New York State Housing Finance Agency, Service Contract 9/05 at 102 BBB+ $3,322,860
Obligation Revenue Bonds, 1995 Series A, 6.375%, 9/15/15
1,385,000 State of New York Mortgage Agency, Homeowner Mortgage Revenue 4/01 at 102 Aa2 1,449,666
Bonds, 1991 Series UU, 7.750%, 10/01/23 (Alternative Minimum Tax)
5,500,000 New York State Urban Development Corporation, State Facilities No Opt. Call BBB+ 5,924,875
Revenue Bonds, 1995 Refunding Series, 5.700%, 4/01/20
1,500,000 New York State Urban Development Corporation, Project Revenue No Opt. Call BBB+ 1,597,275
Bonds (Center for Industrial Innovation), 1995 Refunding Series,
5.500%, 1/01/13
2,125,000 New York State Urban Development Corporation, Project Revenue No Opt. Call BBB+ 2,236,393
Bonds (University Facilities Grants), 1995 Refunding Series,
5.500%, 1/01/19
7,500,000 The Port Authority of New York and New Jersey, Special Project 10/06 at 102 N/R 8,294,025
Bonds, Series 4, KIAC Partners Project, 6.750%, 10/01/19
(Alternative Minimum Tax)
Suffolk County Industrial Development Agency (New York), 1998
Industrial Development Revenue Bonds (Nissequogue Cogen Partners
Facility):
1,800,000 5.300%, 1/01/13 (Alternative Minimum Tax) 1/09 at 101 N/R 1,800,630
4,500,000 5.500%, 1/01/23 (Alternative Minimum Tax) 1/09 at 101 N/R 4,523,490
- ------------------------------------------------------------------------------------------------------------------------------------
North Carolina - 0.7%
1,400,000 The Martin County Industrial Facilities and Pollution Control 11/05 at 102 A 1,457,638
Financing Authority (North Carolina), Solid Waste Disposal Revenue
Bonds, Series 1995 (Weyerhaeuser Company Project), 6.000%, 11/01/25
(Alternative Minimum Tax)
1,299,276 Woodfin Treatment Facility, Inc. (North Carolina), Proportionate 12/03 at 102 N/R 1,356,223
Interest Certificates, 6.750%, 12/01/13
- ------------------------------------------------------------------------------------------------------------------------------------
North Dakota - 0.1%
345,000 State of North Dakota (North Dakota Housing Finance Agency), 7/99 at 103 Aa2 356,109
Single Family Mortgage Program Bonds, 1989 Series B, 8.000%, 7/01/13
- ------------------------------------------------------------------------------------------------------------------------------------
Ohio - 8.0%
2,000,000 City of Cleveland, Ohio, Airport System Revenue Bonds, Series 1/08 at 101 AAA 1,959,300
1997A, 5.125%, 1/01/27 (Alternative Minimum Tax)
1,400,000 Cleveland, Ohio, Public Power System Revenue Bonds, 7.000%, 11/15/17 11/01 at 102 AAA 1,529,080
1,350,000 County of Columbiana, Ohio, County Jail Facilities Construction 12/04 at 102 AA 1,563,125
Bonds (General Obligation -- Unlimited Tax), 6.700%, 12/01/24
1,000,000 County of Cuyahoga, Ohio, Health Care Facilities Revenue Bonds, 6/00 at 100 N/R 1,043,760
Series 1990 (Altenheim Project), 9.280%, 6/01/15
3,000,000 County of Cuyahoga, Ohio, Hospital Revenue Bonds (Meridia 8/05 at 102 AAA 3,423,240
Health System), Series 1995, 6.250%, 8/15/24 (Pre-refunded to 8/15/05)
4,000,000 County of Cuyahoga, Ohio, Hospital Revenue Bonds, Series 1999B 7/09 at 101 AA- 3,892,680
(Cleveland Clinic Health System Obligated Group), 5.125%, 1/01/29
1,000,000 County of Cuyahoga, Ohio, Hospital Facilities Revenue Bonds, 2/03 at 102 AA- 1,071,480
Series 1993, Health Cleveland, Inc. (Fairview General Hospital Project),
6.300%, 8/15/15
2,350,000 City of Garfield Heights, Ohio, Hospital Improvement and Refunding 11/02 at 102 AA-*** 2,621,167
Revenue Bonds, Series 1992B (Marymount Hospital Project), 6.700%,
11/15/15 (Pre-refunded to 11/15/02)
1,500,000 County of Lucas, Ohio Hospital Facilities Revenue Bonds, Series A 1991 12/01 at 102 N/R*** 1,689,240
(Flower Memorial Hospital), 8.125%, 12/01/11 (Pre-refunded to 12/01/01)
3,500,000 County of Miami, Ohio, Hospital Facilities Revenue Refunding and 5/06 at 102 BBB 3,701,740
Improvement Bonds, Series 1996A (Upper Valley Medical Center),
6.375%, 5/15/26
3,000,000 Ohio Housing Finance Agency, Residential Mortgage Revenue Bonds, 9/08 at 102 AAA 3,012,900
1997 Series B (Mortgage-Backed Securities Program), 5.400%, 9/01/29
(Alternative Minimum Tax)
2,750,000 State of Ohio, Ohio Air Quality Development Authority, Air Quality 9/05 at 102 A+ 2,928,860
Development Revenue Refunding Bonds, 1995 Series (The Dayton Power
and Light Company Project), 6.100%, 9/01/30
</TABLE>
15
<PAGE>
Portfolio of Investments
Nuveen Flagship All-American Municipal Bond Fund (continued)
April 30, 1999
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Ohio (continued)
$ 1,750,000 State of Ohio (Ohio Higher Educational Facility Commission), 12/03 at 102 AAA $ 1,963,728
Higher Educational Facility Mortgage Revenue Bonds (University
of Dayton 1992 Project), 6.600%, 12/01/17
3,500,000 County of Shelby, Ohio, Hospital Facilities Revenue Refunding 9/02 at 102 N/R*** 3,974,145
and Improvement Bonds, Series 1992 (The Shelby County Memorial
Hospital Association), 7.700%, 9/01/18 (Pre-refunded to 9/01/02)
- ------------------------------------------------------------------------------------------------------------------------------------
Oklahoma - 1.9%
Edmond Economic Development Authority (Oklahoma), Student
Housing Revenue Bonds (Collegiate Housing Foundation - Edmond Project),
Series 1998A:
2,000,000 5.375%, 12/01/19 12/08 at 102 Baa3 1,946,500
3,250,000 5.500%, 12/01/28 12/08 at 102 Baa3 3,159,683
2,750,000 Trustees of the Tulsa Municipal Airport Trust, Revenue Bonds 6/05 at 102 Baa2 2,904,138
Series 1995 (American Airlines), 6.250%, 6/01/20
- ------------------------------------------------------------------------------------------------------------------------------------
Pennsylvania - 3.4%
2,500,000 Allegheny County Higher Education Building Authority 2/06 at 102 Baa3 2,701,125
(Commonwealth of Pennsylvania), College Revenue Bonds, Series A
of 1996 (Robert Morris College), 6.400%, 2/15/14
3,000,000 Beaver County Industrial Development Authority, Pennsylvania, 6/08 at 102 AAA 3,014,790
Exempt Facilities Revenue Bonds, 1998 Series A (Shippingport
Project), 5.375%, 6/01/28 (Alternative Minimum Tax)
1,500,000 Clarion County Hospital Authority, Hospital Revenue Refunding 7/99 at 102 N/R 1,541,565
Bonds, Series 1989 (Clarion Hospital
Project), 8.100%, 7/01/12
1,000,000 Delaware County Industrial Development Authority, Pollution 4/01 at 102 AAA 1,080,450
Control Revenue Refunding Bonds, 1991
Series A (Philadelphia Electric Company Project), 7.375%,
4/01/21
500,000 Falls Township Hospital Authority, Refunding Revenue Bonds, 8/02 at 102 AAA 531,465
The Delaware Valley Medical Center Project (FHA-Insured Mortgage),
Series 1992, 7.000%, 8/01/22
1,000,000 Latrobe Industrial Development Authority (Commonwealth of 5/04 at 102 AAA 1,145,620
Pennsylvania), College Revenue Bonds
(Saint Vincent College Project), Series 1994, 6.750%, 5/01/24
(Pre-refunded to 5/01/04)
3,000,000 Philadelphia Authority for Industrial Development, Airport 7/08 at 101 AAA 2,875,950
Revenue Bonds, Series 1998A
(Philadelphia Airport System Project), 5.000%, 7/01/23
(Alternative Minimum Tax)
1,700,000 City of Philadelphia, Pennsylvania Gas Works Revenue Bonds, 7/03 at 102 BBB 1,857,930
Fourteenth Series, 6.375%, 7/01/26 Puerto Rico 0.1%
- ------------------------------------------------------------------------------------------------------------------------------------
Puerto Rico - 0.1%
100,000 Commonwealth of Puerto Rico, Public Improvement Bonds of 1994 7/04 at 101 1/2 AAA 113,717
(General Obligation Bonds), 6.500%, 7/01/23
100,000 Puerto Rico Public Buildings Authority, Revenue Refunding No Opt. Call A 106,577
Bonds, Series L, Guaranteed by the Commonwealth of Puerto Rico,
5.500%, 7/01/21
165,000 Puerto Rico Electric Power Authority, Power Revenue Bonds, 7/04 at 102 BBB+*** 187,018
Series 1994-T, 6.375%, 7/01/24 (Pre-refunded to 7/01/04)
70,000 Puerto Rico Industrial, Tourist, Educational, Medical and 8/05 at 101 1/2 AAA 76,045
Environmental Control Facilities Financing Authority,
Hospital Revenue Refunding Bonds, 1995 Series A,
FHA-Insured Mortgage (Pila Hospital Project), 5.875%, 8/01/12
- ------------------------------------------------------------------------------------------------------------------------------------
South Carolina - 3.4%
Berkeley County School District, Certificates of Participation:
250,000 6.250%, 2/01/12 (Pre-refunded to 2/01/04) 2/04 at 102 AAA 279,813
2,225,000 6.300%, 2/01/16 (Pre-refunded to 2/01/04) 2/04 at 102 AAA 2,490,977
Charleston County, South Carolina, Charleston Public
Facilities Corporation, Certificates of Participation, Series 1994B:
240,000 6.875%, 6/01/14 (Pre-refunded to 6/01/04) 6/04 at 102 AAA 277,008
10,000 6.875%, 6/01/14 6/04 at 102 AAA 11,331
1,245,000 Charleston County, South Carolina, Revenue Bonds, Series 1999A No Opt. Call AAA 1,270,747
(CareAlliance Health Services), 5.125%, 8/15/16
</TABLE>
16
<PAGE>
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
South Carolina (continued)
$ 400,000 Board of Trustees of Coastal Carolina University, South Carolina, 6/04 at 102 AAA $ 453,936
Revenue Bonds, Series 1994, 6.800%, 6/01/19
500,000 Darlington County, South Carolina, Industrial Development Revenue 4/06 at 102 A 529,515
Bonds (Sonoco Products Company Project), Series 1996, 6.000%,
4/01/26 (Alternative Minimum Tax)
200,000 Greenville Hospital System Board of Trustees, Hospital Facilities No Opt. Call Aa3 225,682
Revenue Bonds (South Carolina), Series 1990, 6.000%, 5/01/20
300,000 City of Greenville, South Carolina, Waterworks System Revenue 2/07 at 102 Aa1 309,687
Bonds, Series 1997, 5.500%, 2/01/22
250,000 Greenwood County, South Carolina, Hospital Facilities Revenue 10/03 at 102 AAA 263,345
Bonds (Self Memorial Hospital), Series 1993, 5.875%, 10/01/17
300,000 Horry County, South Carolina, Airport Revenue Bonds, Series 7/07 at 102 AAA 314,973
1997A, 5.700%, 7/01/27 (Alternative Minimum Tax)
500,000 Lexington, South Carolina, Water and Sewer Revenue, 5.500%, 4/07 at 102 AA 512,070
4/01/29
1,405,000 Piedmont Municipal Power Agency (South Carolina), Electric 1/09 at 101 Baa2 1,373,359
Revenue Bonds, 1999A Refunding Series, 5.250%, 1/01/15
250,000 South Carolina Jobs - Economic Development Authority, Hospital 11/05 at 102 AAA 265,793
Revenue Bonds (Tuomey Regional Medical Center), Series A 1995,
5.750%, 11/01/15
300,000 South Carolina Regional Housing Development Corporation No. 1, 7/02 at 102 Aa 317,055
Multifamily Revenue Refunding, Redwood Village Apartments,
Series A, 6.625%, 7/01/17
500,000 South Carolina State Education Assistance Authority, Guaranteed 9/04 at 101 A 528,980
Student Loan Revenue and Refunding Bonds, 1994 Series, 6.300%,
9/01/08 (Alternative Minimum Tax)
250,000 South Carolina State Housing Authority, Homeownership Mortgage 7/04 at 102 AA 266,335
Purchase, Series A, 6.150%, 7/01/08
250,000 South Carolina State Housing Finance and Development Authority, 5/06 at 102 Aa2 266,208
Mortgage Revenue Bonds, Series 1996A, 6.350%, 7/01/25
(Alternative Minimum Tax)
1,000,000 South Carolina Housing Finance and Development Authority, 6/05 at 102 BBB+ 1,071,940
Multifamily Housing Mortgage Revenue Bonds (United Dominion -
Hunting Ridge Apartments Project), Series 1995, 6.750%, 6/01/25
(Alternative Minimum Tax) (Mandatory put 6/01/10)
1,250,000 South Carolina Housing Finance and Development Authority, 12/05 at 102 AA- 1,306,300
Multifamily Housing Revenue Refunding Bonds (Runaway Bay
Apartments Project), Series 1995, 6.125%, 12/01/15
250,000 Spartanburg, South Carolina, Sanitation Sewer District Sewer 6/07 at 101 AAA 260,418
System Revenue Improvement, 5.500%, 6/01/20
2,000,000 York County, South Carolina, Water and Sewer System Revenue 12/03 at 102 N/R 2,028,140
Bonds, Series 1995, 6.500%, 12/01/25
- -----------------------------------------------------------------------------------------------------------------------------------
South Dakota - 0.6%
2,500,000 Education Loans Incorporated (South Dakota), Tax Exempt Fixed Rate 6/08 at 102 A2 2,521,025
Student Loan Asset-Backed Callable Notes, Subordinate Series
1998-1K, 5.600%, 6/01/20
- -----------------------------------------------------------------------------------------------------------------------------------
Tennessee - 2.1%
2,925,000 The Health and Educational Facilities Board of the Metropolitan 2/08 at 102 AA 2,997,540
Government of Nashville and Davidson County, Tennessee,
Multi-Modal Interchangeable Rate, Health Facility Revenue Bonds
(Richland Place, Inc. Project), Series 1993, 5.500%, 5/01/23
2,125,000 The Health, Educational and Housing Facility Board of the County 8/07 at 105 N/R*** 2,946,483
of Shelby, Tennessee, ICF/MR Revenue Bonds (Open Arms
Developmental Centers), Series 1992A, 9.750%, 8/01/19
(Pre-refunded to 8/01/07)
1,380,000 Industrial Development Board of the City of South Fulton, 10/05 at 102 A3 1,485,694
Tennessee, Inc., Industrial Development Revenue Bonds (Tyson
Foods, Inc. Project), Series 1995, 6.350%, 10/01/15 (Alternative
Minimum Tax)
1,500,000 Wilson County, Tennessee, Series 1994, Certificates of 6/04 at 102 A2*** 1,679,355
Participation (Wilson County Educational Facilities Corporation),
6.250%, 6/30/15 (Pre-refunded to 6/30/04)
- -----------------------------------------------------------------------------------------------------------------------------------
Texas - 12.1%
7,000,000 Alliance Airport Authority, Inc., Special Facilities Revenue 4/06 at 102 BBB 7,551,530
Bonds, Series 1996 (Federal Express Corporation Project), 6.375%,
4/01/21 (Alternative Minimum Tax)
5,000,000 Brazos River Authority (Texas), Pollution Control Revenue 4/08 at 102 Baa1 4,947,850
Refunding Bonds (Texas Utilities Electric Company Project),
Series 1995C, 5.550%, 6/01/30 (Alternative Minimum Tax)
</TABLE>
17
<PAGE>
Portfolio of Investments
Nuveen Flagship All-American Municipal Bond Fund (continued)
April 30, 1999
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Texas (continued)
$ 7,000,000 Brazos River Authority (Texas), Pollution Control Revenue 5/08 at 102 AAA $ 7,153,300
Refunding Bonds (Texas Utilities Electric Company Project),
Series 1998A, 5.550%, 5/01/33 (Alternative Minimum Tax)
6,000,000 Brazos River Authority (Texas), Revenue Refunding Bonds (Houston No Opt. Call AAA 5,966,879
Lighting and Power Company Project), Series 1998, 5.050%,
11/01/18 (Alternative Minimum Tax)
6,000,000 Brazos River Authority (Texas), Revenue Refunding Bonds (Reliant 4/09 at 101 BBB+ 6,004,919
Energy, Incorporated Project), Series 1999A, 5.375%, 4/01/19
2,000,000 Dallas-Fort Worth International Airport Facility Improvement 11/02 at 102 Baa2 2,189,119
Corporation, American Airlines, Inc. Revenue Bonds, Series 1992,
7.250%, 11/01/30 (Alternative Minimum Tax)
8,400,000 Gulf Coast Waste Disposal Authority (Texas), Waste Disposal 4/09 at 101 BBB- 8,397,059
Revenue Bonds (Valero Energy Corporation Project), Series 1999,
5.700%, 4/01/32 (Alternative Minimum Tax)
2,500,000 Lower Neches Valley Authority, Industrial Development Corporation 3/08 at 101 AA 2,572,649
(Texas), Refunding Revenue Bonds, Series 1998 (Mobil Oil Refining
Corporation Project), 5.550%, 3/01/33
2,000,000 North Central Texas Health Facilities Development Corporation, 2/06 at 102 BBB 2,120,500
Health Facilities Development Revenue Bonds (C.C. Young Memorial
Home Project), Series 1996, 6.375%, 2/15/20
2,895,000 Port of Bay City Authority of Matagorda County (Texas), Revenue 5/06 at 102 A+ 3,151,293
Bonds (Hoechst Celanese Corporation Project), Series 1996, 6.500%,
5/01/26 (Alternative Minimum Tax)
2,000,000 City of San Antonio (Texas), Electric and Gas Systems Revenue 2/09 at 100 Aa1 1,842,000
Refunding Bonds, New Series 1998A, 4.500%, 2/01/21
- ------------------------------------------------------------------------------------------------------------------------------------
Utah - 0.5%
2,000,000 Carbon County, Utah, Solid Waste Disposal Refunding Revenue Bonds 2/05 at 102 BBB 2,246,700
(Laidlaw Inc./ECDC Environmental, L.C. Project), 1995 Series A,
7.500%, 2/01/10 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Virginia - 0.9%
2,000,000 Industrial Development Authority of the County of Hanover No Opt. Call AAA 2,350,019
(Virginia), Hospital Revenue Bonds, Series 1995 (Memorial
Regional Medical Center Project at Hanover Medical Park)
(Guaranteed by Bon Secours Health System Obligated Group),
6.375%, 8/15/18
1,250,000 Southeastern Public Service Authority of Virginia, Senior Revenue 7/03 at 102 A- 1,300,424
Bonds, Series 1993 (Regional Solid Waste System), 6.000%, 7/01/13
(Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
West Virginia - 0.1%
500,000 Mason County, West Virginia, Pollution Control Revenue Bonds 1/00 at 102 Baa1 519,184
(Appalachian Power Company Project), Series G, 7.400%, 1/01/14
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin - 0.2%
825,000 Village of Fall Creek, Wisconsin, Municipal Nursing Home Mortgage 7/99 at 100 N/R 830,032
Revenue Bonds, Series 1989, 9.875%, 7/01/19
- -----------------------------------------------------------------------------------------------------------------------------------
$425,474,276 Total Investments - (cost $392,942,990) - 98.2% 419,264,973
============------------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 1.8% 7,550,982
---------------------------------------------------------------------------------------------------------------------
Net Assets - 100% $426,815,955
=====================================================================================================================
</TABLE>
* Optional Call Provisions (not covered by the report of independent public
accountants): Dates (month and year) and prices of the earliest optional
call or redemption. There may be other call provisions at varying prices at
later dates.
** Ratings (not covered by the report of independent public accountants):
Using the higher of Standard & Poor's or Moody's rating.
*** Securities are backed by an escrow or trust containing sufficient U.S.
government or U.S. government agency securities which ensures the timely
payment of principal and interest. Securities are normally considered to be
equivalent to AAA rated securities.
N/R Investment is not rated.
See accompanying notes to financial statements.
______
18
<PAGE>
Portfolio of Investments
Nuveen Flagship Intermediate Municipal Bond Fund
April 30, 1999
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Arizona - 0.3%
$ 205,000 The Industrial Development Authority of the County of Pima, Single Family 5/07 at 102 AAA $ 215,078
Mortgage Revenue Refunding Bonds, Series 1997B, 5.850%, 5/01/09
(Alternative Minimum Tax)
- -----------------------------------------------------------------------------------------------------------------------------------
California - 3.9%
555,000 La Mirada Redevelopment Agency (California), Community Facilities District No Opt. Call N/R 566,855
No. 89-1 (Civic Theatre Project), 1998 Refunding Special Tax Bonds
(Tax Increment Contribution), 5.200%, 10/01/06
1,000,000 Sacramento Cogeneration Authority, Cogeneration Project Revenue Bonds 7/05 at 102 BBB- 1,104,730
(Procter & Gamble Project), 1995 Series, 6.200%, 7/01/06
770,000 Washington Township (California), Health Care District Revenue Bonds, 7/08 at 101 A2 767,513
Series 1999, 5.000%, 7/01/11 (WI)
- -----------------------------------------------------------------------------------------------------------------------------------
Colorado - 6.7%
2,300,000 Public Highway Authority, Capital Improvement Trust Fund, 8/05 at 95 29/32 Aaa 1,698,711
Highway Revenue Bonds (E-470 Project), Arapahoe County,
Colorado, Senior Bonds, 0.000%, 8/31/06
(Pre-refunded to 8/31/05)
1,000,000 Aurora Centretech Metropolitan District, Arapahoe County, Colorado, 12/06 at 102 A+ 1,000,760
General Obligation Refunding Bonds, Series 1998C, 4.875%, 12/01/28
(Mandatory put 12/01/08)
500,000 Colorado Health Facilities Authority, Revenue Bonds, Series 1995 12/05 at 102 A- 550,450
(Covenant Retirement Communities Inc.), 6.200%, 12/01/07
900,000 Eagle County Air Terminal Corporation, Airport Terminal Project No Opt. Call N/R 950,013
Revenue Bonds, Series 1996, 6.750%, 5/01/06
(Alternative Minimum Tax)
- -----------------------------------------------------------------------------------------------------------------------------------
Connecticut - 0.6%
335,000 Eastern Connecticut Resource Recovery Authority, Solid Waste 1/03 at 102 BBB+ 344,571
Revenue Bonds (Wheelbrator Lisbon Project), Series 1993A,
5.150%, 1/01/05 (Alternative Minimum Tax)
- -----------------------------------------------------------------------------------------------------------------------------------
Delaware - 0.9%
500,000 Delaware Economic Development Authority, First Mortgage Revenue Bonds 5/07 at 102 BBB 545,140
(Peninsula United Methodist Homes, Inc. Issue), Series 1997A,
6.100%, 5/01/10
- -----------------------------------------------------------------------------------------------------------------------------------
District of Columbia - 0.3%
205,000 District of Columbia, University Revenue Bonds (American University 10/06 at 101 AAA 218,006
Issue), Series 1996, 5.375%, 10/01/08
- -----------------------------------------------------------------------------------------------------------------------------------
Florida - 18.5%
200,000 Alachua County Health Facilities Authority, Florida, Health Facilities 12/06 at 102 AAA 216,140
Revenue Bonds, Series 1996A (Shands Teaching Hospital and Clinics,
Inc. Project), 5.300%, 12/01/08
485,000 City of Auburndale, Florida, Water and Sewer Revenue Bonds, Series 1995, 12/05 at 102 AAA 523,538
5.375%, 12/01/08
300,000 Brevard County Housing Finance Authority, Florida, Multi-Family Housing 2/06 at 101 AAA 339,045
Revenue Refunding Bonds (Windover Oaks and Windover Health Club
Apartments Projects), Series 1996A, 6.900%, 2/01/27
(Mandatory put 2/01/07)
200,000 The School District of Dade County, Florida, General Obligation 7/06 at 101 AAA 203,536
Refunding School Bonds, Series 1996, 4.500%, 7/15/08
500,000 Dade County, Florida, Seaport Revenue Refunding Bonds, Series 1995, No Opt. Call AAA 575,955
6.200%, 10/01/10
335,000 Dade County, Florida, Special Obligation and Refunding Bonds, 10/08 at 98 7/32 AAA 211,414
Series 1996B, 0.000%, 10/01/09
500,000 Duval County School District, Florida, General Obligation Refunding 8/02 at 102 AAA 532,815
Bonds, Series 1992, 6.300%, 8/01/08
160,000 Escambia County Housing Finance Authority, Florida, Single Family 4/07 at 102 Aaa 167,275
Mortgage Revenue Bonds, Series 1997A (Multi-County Program),
5.500%, 4/01/08 (Alternative Minimum Tax)
</TABLE>
19
<PAGE>
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provision* Ratings** Value
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Florida (continued)
$ 200,000 Escambia County, Florida, Pollution Control Refunding Revenue Bonds 11/02 at 102 Baa1 $ 218,184
(Champion International Project), Series 1992, 6.950%, 11/01/07
180,000 Florida Housing Finance Agency, Single Family Mortgage Revenue No Opt. Call AAA 186,982
Refunding Bonds, Series 1995A, 6.000%, 1/01/04 (Alternative
Minimum Tax)
325,000 Florida Ports Financing Commission, Revenue Bonds (State Transportation No Opt. Call AAA 340,275
Trust Fund), Series 1996, 5.000%, 6/01/07 (Alternative Minimum Tax)
500,000 State of Florida, Full Faith and Credit, Broward County Expressway No Opt. Call AA+ 700,600
Authority, Series of 1984, 9.875%, 7/01/09
200,000 Greater Orlando Aviation Authority, Airport Facilities Revenue Bonds, No Opt. Call AAA 219,220
City of Orlando, Florida, Series 1997, 5.750%, 10/01/10 (Alternative
Minimum Tax)
405,000 Gulf Breeze Local Government Loan Program Bonds, Remarketed Series 12/06 at 101 AAA 436,100
1985-B, 5.600%, 12/01/15 (Mandatory put 12/01/07)
145,000 School District of Gulf County, Florida, Sales Tax Revenue Bonds, 6/07 at 101 AA 153,104
Series 1997, 5.200%, 6/01/08
200,000 Halifax Hospital Medical Center (Daytona Beach, Florida), Health No Opt. Call A 200,356
Care Facilities Revenue Bonds (Halifax Management System,
Inc. Project), 1998 Series A, 4.600%, 4/01/08
200,000 Hillsborough County Aviation Authority, Florida, Tampa International 10/06 at 101 AAA 219,106
Airport Revenue Refunding Bonds, Series 1997 A, 5.750%, 10/01/07
(Alternative Minimum Tax)
200,000 Hillsborough County, Florida, Capital Improvement Program Refunding 8/06 at 102 AAA 208,098
Revenue Bonds, Series 1996, 4.800%, 8/01/08
150,000 Indian Trace Community Development District (Broward County, Florida), 5/05 at 102 AAA 162,434
Water Management Special Benefit Refunding Bonds, Series 1995A,
5.500%, 5/01/06
165,000 Jacksonville Health Facilities Authority, Florida, Tax Exempt Industrial No Opt. Call Baa1 177,375
Development Revenue Bonds (National Benevolent Association - Cypress
Village Florida Project), Series 1996A, 5.850%, 12/01/06
400,000 Lee County, Florida, Capital Revenue Refunding Bonds, Series A, 5.750%, No Opt. Call AAA 446,148
10/01/11
250,000 Hospital Board of Directors of Lee County, Florida, Hospital Revenue 4/07 at 102 AAA 269,975
Bonds (Lee Memorial Health System), Fixed Rate Hospital Revenue
Bonds, 1997 Series A, 5.400%, 4/01/09
250,000 Lee County, Florida, Industrial Development Authority, Utilities Revenue 11/06 at 101 AAA 269,903
Refunding Bonds, Bonita Springs Utilities Project, 5.450%, 11/01/07
(Alternative Minimum Tax)
200,000 Leesburg, Florida, Hospital Revenue Refunding, Leesburg Regional Medical 7/06 at 102 A- 214,424
Center, Project A, 5.600%, 7/01/08
290,000 Levy County, Florida, School Board Certificates of Participation, 5.500%, 7/05 at 102 AA 313,113
7/01/06
125,000 Lynn Haven, Florida, Special Project Revenue, 5.250%, 10/01/05 No Opt. Call AAA 132,206
(Alternative Minimum Tax)
250,000 Martin County, Florida, Special Assessment Bonds, Series 1995 (Tropical No Opt. Call A2 269,368
Farms Water and Sewer Special Assessment District), 5.600%, 11/01/05
300,000 Orange County Housing Finance Authority, Single Family Mortgage Revenue 9/07 at 102 AAA 311,070
Bonds (GNMA and Fannie Mae Mortgage Backed Securities Program), Series
1997B, 5.400%, 9/01/09 (Alternative Minimum Tax)
375,000 Pasco County, Florida, Solid Waste Disposal and Resource Recovery System 4/07 at 101 AAA 394,478
Revenue, Series B, 5.250%, 4/01/09 (Alternative Minimum Tax)
100,000 Pembroke Pines, Florida, Special Assessment No. 94-1, 5.750%, 11/01/05 No Opt. Call A3 107,475
200,000 Pensacola, Florida, Airport Revenue, Series B, 5.400%, 10/01/07 No Opt. Call AAA 214,564
B, 5.400%, 10/01/07 (Alternative Minimum Tax)
500,000 Housing Finance Authority of Polk County, Florida, Multifamily Housing 7/05 at 101 AAA 522,420
Revenue Bonds (Winter Oaks Apartments Project), Series 1997A, 5.250%,
7/01/22 (Mandatory put 7/01/07)
1,000,000 Sanford Airport Authority, Florida, Industrial Development Revenue Bonds No Opt. Call N/R 1,058,820
(Central Florida Terminals Inc. Project), Series 1995A, 7.500%, 5/01/06
(Alternative Minimum Tax)
250,000 Sanford Airport Authority, Florida, Industrial Development Revenue Bonds No Opt. Call N/R 266,845
(Central Florida Terminals Inc. Project), Series 1997C, 6.750%, 5/01/05
</TABLE>
20
<PAGE>
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provision* Ratings** Value
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Florida (continued)
$ 200,000 Sarasota County, Florida, Health Facilities Authority, Health No Opt. Call N/R $ 208,764
Facilities Revenue Refunding Bonds, Series 1995 (Sunnyside
Properties Project), 5.500%, 5/15/05
200,000 Sarasota-Manatee Airport Authority, Airport System Revenue Refunding 8/06 at 102 AAA 215,234
Bonds, Series 1996, 5.250%, 8/01/08
250,000 City of Tampa, Florida, Health System Revenue Bonds, Catholic Health No Opt. Call AAA 270,255
East Issue, Series 1998A-1, 5.500%, 11/15/12
- -----------------------------------------------------------------------------------------------------------------------------------
Illinois - 7.0%
500,000 City of Chicago, Chicago-O'Hare International Airport, Special No Opt. Call Baa2 506,410
Facilities Revenue Refunding Bonds (United Airlines, Inc. Project),
Series 1999B, 5.200%, 4/01/11 (Alternative Minimum Tax)
1,000,000 Illinois Development Finance Authority, Adjustable Rate Solid No Opt. Call Aa2 1,000,010
Waste Disposal Revenue Bonds (Waste Management, Inc. Project),
Series 1997, 5.050%, 1/01/10 (Alternative Minimum Tax)
225,000 Illinois Development Finance Authority, Economic Development 8/08 at 100 Baa2 228,942
Revenue Bonds, Series 1998 (The Latin School of Chicago Project),
5.250%, 8/01/09
1,000,000 Illinois Health Facilities Authority, Revenue Bonds, Series 1996 No Opt. Call BBB 1,068,250
(Mercy Hospital and Medical Center Project), 6.000%, 1/01/06
Illinois Health Facilities Authority, Revenue Bonds, Series 1998
(Centegra Health System):
500,000 5.500%, 9/01/09 9/08 at 101 A- 522,210
500,000 5.500%, 9/01/10 9/08 at 101 A- 521,620
500,000 Illinois Health Facilities Authority, Revenue Bonds (Victory Health 8/07 at 101 A- 538,145
Service), Series 1997A, 5.750%, 8/15/08
- -----------------------------------------------------------------------------------------------------------------------------------
Indiana - 1.7%
500,000 Indiana Bond Bank Special Program Bonds, Series 1997 B (Hendricks 2/07 at 102 AA- 539,325
County Redevelopment Authority, Pittboro Project), 5.750%, 2/01/08
495,000 Indiana Health Facility Financing Authority, Hospital Revenue Bonds No Opt. Call AA+ 508,276
(Charity Obligated Group - Daughters of Charity National Health
System), Series 1997D, 5.000%, 11/01/26 (Mandatory put 11/01/07)
- -----------------------------------------------------------------------------------------------------------------------------------
Kansas - 0.7%
420,000 Lenexa, Kansas, Multifamily Housing Revenue Refunding Bonds (Barrington 2/03 at 102 AA 445,032
Park Apartments Project), Series 1993A, 6.200%, 2/01/08
- -----------------------------------------------------------------------------------------------------------------------------------
Louisiana - 2.1%
2,000,000 Jefferson Sales Tax District, Parish of Jefferson, State of Louisiana, No Opt. Call AAA 1,041,600
Special Sales Tax Revenue and Refunding Bonds, Series 1998, 0.000%,
12/01/12
265,000 Louisiana Public Facilities Authority, Student Loan Revenue Bonds, Series 9/02 at 102 Aaa 284,136
1992A-2, 6.600%, 3/01/03 (Alternative Minimum Tax)
- -----------------------------------------------------------------------------------------------------------------------------------
Maryland - 0.9%
500,000 Maryland Health and Higher Educational Facilities Authority, Refunding 1/07 at 102 A- 541,995
Revenue Bonds, Pickersgill Issue, Series 1997A, 5.750%, 1/01/08
- -----------------------------------------------------------------------------------------------------------------------------------
Massachusetts - 1.7%
1,000,000 Massachusetts Health and Educational Facilities Authority, Revenue Bonds, 7/08 at 101 A 1,032,810
Massachusetts Eye and Ear Infirmary Issue, Series B, 5.250%, 7/01/10
- -----------------------------------------------------------------------------------------------------------------------------------
Michigan - 5.5%
1,000,000 Michigan State Hospital Finance Authority, Hospital Revenue Refunding No Opt. Call BBB 1,062,930
Bonds (Gratiot Community Hospital, Alma, Michigan), Series 1995, 6.100%,
10/01/07
1,000,000 Michigan State Hospital Finance Authority, Hospital Revenue and Refunding No Opt. Call BBB 1,051,810
Bonds (Genesys Regional Medical Center Obligated Group,) Series 1998A,
5.500%, 10/01/08
215,000 Michigan Strategic Fund, Limited Obligation Revenue Bonds (Clark No Opt. Call BBB+ 213,127
Retirement Community Inc. Project), Series 1998, 4.900%, 6/01/08
</TABLE>
21
<PAGE>
Portfolio of Investments
Nuveen Flagship Intermediate Municipal Bond Fund (continued)
April 30, 1999
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provision* Ratings** Value
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Michigan (continued)
$ 1,000,000 County of Monroe, Michigan, Pollution Control Revenue Bonds (The No Opt. Call AAA $1,100,330
Detroit Edison Company Project), Series A-1994, 6.350%, 12/01/04
(Alternative Minimum Tax)
- -----------------------------------------------------------------------------------------------------------------------------------
Minnesota - 1.6%
1,000,000 Housing and Redevelopment Authority of the City of Saint Paul, No Opt. Call BBB+ 1,011,080
Minnesota, Health Care Revenue Bonds (Regions Hospital Project),
Series 1998, 5.000%, 5/15/09
- -----------------------------------------------------------------------------------------------------------------------------------
Mississippi - 0.8%
500,000 Perry County (Mississippi), Pollution Control Refunding Revenue 3/12 at 100 Baa2 499,500
Bonds (Leaf River Forest Project), Series 1999, 5.200%, 10/01/12
- -----------------------------------------------------------------------------------------------------------------------------------
Missouri - 2.7%
1,000,000 The Industrial Development Authority of the City of Kansas City, 11/08 at 102 N/R 978,350
Missouri, Retirement Facility, Refunding and Improvement Revenue
Bonds, Series 1998A (Kingswood Project), 5.375%, 11/15/09
300,000 Health and Educational Facilities Authority of the State of 2/07 at 102 N/R 317,937
Missouri, Health Facilities Revenue Bonds (Lutheran Senior Services),
Series 1997, 5.550%, 2/01/09
350,000 The Industrial Development Authority of the City of St. Louis, 12/02 at 102 N/R 375,939
Missouri, Industrial Revenue Refunding Bonds (Kiel Center Multipurpose
Arena Project), Series 1992, 7.625%, 12/01/09 (Alternative Minimum Tax)
- -----------------------------------------------------------------------------------------------------------------------------------
Nebraska - 3.2%
1,000,000 American Public Energy Agency, Gas Supply Revenue Bonds (Nebraska Public No Opt. Call AAA 980,170
Gas Agency - Western A Project), 1999 Series A, 4.375%, 6/01/10
1,000,000 Energy America (Nebraska), Natural Gas Revenue Note (Metropolitan No Opt. Call N/R 1,008,960
Utility District Project), Series 1997B, 5.700%, 7/01/08
- -----------------------------------------------------------------------------------------------------------------------------------
New Jersey - 1.7%
500,000 New Jersey Economic Development Authority, Insured Revenue Bonds No Opt. Call AAA 535,595
(Educational Testing Service Issue), Series 1995B, 5.500%, 5/15/05
500,000 New Jersey Educational Facilities Authority, Revenue Bonds, No Opt. Call BBB 508,800
Saint Peters College Issue, 1998 Series B, 5.000%, 7/01/08
- -----------------------------------------------------------------------------------------------------------------------------------
New Mexico - 0.1%
80,000 New Mexico Educational Assistance Foundation, Student Loan No Opt. Call Aaa 85,750
Revenue Bonds, Senior 1992 Series One-A, 6.300%, 12/01/02
(Alternative Minimum Tax)
- -----------------------------------------------------------------------------------------------------------------------------------
New York - 10.5%
500,000 Albany Housing Authority, City of Albany, New York, Limited 10/05 at 102 Baa1 520,600
Obligation Bonds, Series 1995, 5.700%, 10/01/06
275,000 The City of New York, General Obligation Bonds, Fiscal 1997 8/06 at 101 1/2 A- 308,737
Series A, Fixed Rate Tax-Exempt Bonds, 6.250%, 8/01/08
200,000 The City of New York, General Obligation Bonds, Fiscal 1996 No Opt. Call A- 217,252
Series G, 5.750%, 2/01/06
500,000 The City of New York, General Obligation Bonds, Fiscal 1997 8/06 at 101 1/2 A- 545,620
Series B, 5.700%, 8/15/07
145,000 The City of New York, General Obligation Bonds, Fiscal 1993 2/05 at 101 A-*** 163,588
Series F, 6.375%, 2/15/06 (Pre-refunded to 2/15/05)
555,000 The City of New York, General Obligation Bonds, Fiscal 1995 2/05 at 101 A- 616,877
Series F, 6.375%, 2/15/06
1,000,000 Dormitory Authority of the State of New York, Mental Health 2/07 at 102 A- 1,108,230
Services Facilities Improvement Revenue Bonds, Series 1997A,
6.000%, 2/15/08
750,000 New York State Housing Finance Agency, Health Facilities Revenue No Opt. Call A- 820,943
Bonds, New York City, 1996 Series A Refunding, 6.000%, 5/01/06
1,000,000 The Port Authority of New York and New Jersey, Special Project No Opt. Call N/R 1,106,480
Bonds, Series 4, KIAC Partners Project, 7.000%, 10/01/07
(Alternative Minimum Tax)
</TABLE>
22
<PAGE>
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provision* Ratings** Value
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
New York (continued)
$ 1,000,000 The Port Authority of New York and New Jersey, Special Project No Opt. Call AAA $1,143,480
Bonds, Series 6, JFK International Air Terminal LLC Project,
6.250%, 12/01/10 (Alternative Minimum Tax)
- -----------------------------------------------------------------------------------------------------------------------------------
Ohio - 8.0%
Cleveland-Cuyahoga County Port Authority, Subordinate Refunding Revenue
Bonds, Series 1997 (Rock and Roll Hall of Fame and Museum Project):
360,000 5.750%, 12/01/07 No Opt. Call N/R 383,818
425,000 5.850%, 12/01/08 No Opt. Call N/R 456,276
1,000,000 City of Dayton, Ohio, Special Facilities Revenue Refunding Bonds, No Opt. Call BBB 1,068,910
1988 Series C (Emery Air Freight Corporation and Emery Worldwide
Airlines, Inc. - Guarantors) (Non-AMT), 6.050%, 10/01/09
1,000,000 County of Franklin, Ohio, Hospital Refunding and Improvement 11/06 at 101 Aa 1,081,020
Revenue Bonds, 1996 Series A (The Children's Hospital Project),
5.550%, 11/01/07
1,000,000 County of Hamilton, Ohio, Hospital Facilities Revenue Bonds, No Opt. Call AAA 1,062,850
Series 1993 (Children's Hospital Medical Center), 5.200%, 5/15/09
900,000 Miami County, Ohio, Hospital Facilities Revenue Refunding and No Opt. Call BBB 951,966
Improvement Bonds (Upper Valley Medical Center), Series 1996C,
6.000%, 5/15/06
- -----------------------------------------------------------------------------------------------------------------------------------
Pennsylvania - 5.2%
Pennsylvania Higher Educational Facilities Authority (Commonwealth of
Pennsylvania), Geneva College Revenue Bonds, Series of 1998:
470,000 4.900%, 4/01/07 No Opt. Call BBB- 472,124
495,000 4.950%, 4/01/08 No Opt. Call BBB- 495,688
2,195,000 Pleasant Valley School District, Monroe County (Pennsylvania), No Opt. Call AAA 1,224,152
General Obligation Bonds, Series of 1999, 0.000%, 9/01/11
1,500,000 Municipal Authority of Westmoreland County (Pennsylvania), No Opt. Call AAA 1,046,445
Municipal Service Revenue Bonds, Series of 1995A 0.000%, 8/15/07
- -----------------------------------------------------------------------------------------------------------------------------------
South Carolina - 0.3%
195,000 City of Myrtle Beach, South Carolina, Myrtle Beach Public No Opt. Call A3*** 205,064
Facilities Corporation, Certificates of Participation (City of
Myrtle Beach Convention Center Project), Series 1992, 6.750%,
7/01/02
- -----------------------------------------------------------------------------------------------------------------------------------
Tennessee - 1.7%
500,000 Memphis-Shelby County Airport Authority (Tennessee), Special No Opt. Call BBB 522,805
Facilities Revenue Refunding Bonds, Series 1997 (Federal Express
Corporation), 5.350%, 9/01/12
500,000 The Industrial Development Board of the Metropolitan Government No Opt. Call N/R 518,265
of Nashville and Davidson County (Tennessee), Industrial Development
Revenue Refunding and Improvement Bonds (Osco Treatment Systems,
Inc. Project), Series 1993, 6.000%, 5/01/03 (Alternative Minimum Tax)
- -----------------------------------------------------------------------------------------------------------------------------------
Texas - 6.5%
1,000,000 Alliance Airport Authority, Inc. (Texas), Special Facilities No Opt. Call Baa2 1,174,320
Revenue Bonds, Series 1991 (American Airlines, Inc. Project),
7.000%, 12/01/11 (Alternative Minimum Tax)
345,000 Brazos Higher Education Authority, Inc., Student Loan Revenue No Opt. Call Aaa 368,895
Refunding Bonds, Series 1993A-1, 6.200%, 12/01/02 (Alternative
Minimum Tax)
3,000,000 Goose Creek Consolidated Independent School District (Texas), No Opt. Call AAA 1,925,550
Unlimited Tax Refunding Bonds, Series 1993, 0.000%, 2/15/09
535,000 Texas Department of Housing and Community Affairs, Multifamily No Opt. Call A 566,126
Housing Revenue Bonds (NHP-Foundation - Asmara Project),
Series 1996A, 5.800%, 1/01/06
- -----------------------------------------------------------------------------------------------------------------------------------
Utah - 0.5%
290,000 Salt Lake County, Utah, College Revenue Bonds (Westminster 10/07 at 101 BBB 295,240
College of Salt Lake City Project), Series 1997, 5.200%,
10/01/09
</TABLE>
23
<PAGE>
Portfolio of Investments
Nuveen Flagship Intermediate Municipal Bond Fund (continued)
April 30, 1999
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provision* Ratings** Value
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Virgin Island - 2.6%
$ 585,000 Virgin Islands Port Authority, Airport Revenue Refunding Bonds, 9/02 at 101 BBB $ 585,082
Series 1998A, 4.500%, 9/01/05 (Alternative Minimum Tax)
1,000,000 Virgin Islands Water and Power Authority, Electric System Revenue 7/08 at 101 N/R 1,044,820
and Refunding Bonds, 1998 Series, 5.250%, 7/01/09
- -----------------------------------------------------------------------------------------------------------------------------------
Virginia - 0.8%
500,000 Pocahontas Parkway Association, Route 895 Connector Toll Road No Opt. Call BBB- 514,689
Revenue Bonds, Senior Current Interest, Series 1998A, 5.250%,
8/15/07
- -----------------------------------------------------------------------------------------------------------------------------------
Wisconsin - 1.2%
750,000 Wisconsin Health and Educational Facilities Authority, Revenue 10/07 at 101 BBB- 749,362
Bonds, Series 1998 (Carroll College, Inc. Project), 5.000%,
10/01/09
- -----------------------------------------------------------------------------------------------------------------------------------
Wyoming - 0.3%
200,000 State of Wyoming, Farm Loan Board, Capital Facilities Refunding 10/02 at 102 AA- 217,791
Revenue Bonds, Series 1992, 6.100%, 10/01/06
- -----------------------------------------------------------------------------------------------------------------------------------
$62,480,000 Total Investments - (cost $58,355,084) - 98.5% 61,430,545
- -----------------------------------------------------------------------------------------------------------------------------------
Temporary Investments in Short-Term Municipal Securities - 1.6%
$ 1,000,000 Maricopa County, Arizona, Pollution Control Corporation, Pollution Control A-1+ 1,000,000
Revenue Refunding Bonds (Arizona Public Service Company-Palo Verde Project),
1994 Series C, Variable Rate Demand Bonds, 4.250%, 5/01/29+
- ------------------------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - (0.1)% (94,966)
- -----------------------------------------------------------------------------------------------------------------------------------
Net Assets - 100% $62,335,579
===================================================================================================================================
</TABLE>
* Optional Call Provisions (not covered by the report of independent public
accountants): Dates (month and year) and prices of the earliest optional
call or redemption. There may be other call provisions at varying prices
at later dates.
** Ratings (not covered by the report of independent public accountants):
Using the higher of Standard & Poor's or Moody's rating.
*** Securities are backed by an escrow or trust containing sufficient U.S.
government or U.S. government agency securities which ensures the timely
payment of principal and interest. Securities are normally considered to
be equivalent to AAA rated securities.
N/R Investment is not rated.
(WI) Security purchased on a when-issued basis (note 1).
+ Security has a maturity of more than one year, but has variable rate and
demand features which qualify it as a short-term security. The rate
disclosed is that currently in effect. This rate changes periodically
based on market conditions or a specified market index.
See accompanying notes to financial statements.
24
<PAGE>
Portfolio of Investments
Nuveen Flagship Limited Term Municipal Bond Fund
April 30, 1999
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Alaska - 0.2%
$1,250,000 Alaska Student Loan Corporation, Student Loan Revenue Bonds, 1997 No Opt. Call AAA $1,301,475
Series A, 5.200%, 7/01/06 (Alternative Minimum Tax)
- -----------------------------------------------------------------------------------------------------------------------------------
Arizona - 0.4%
250,000 Arizona Educational Loan Marketing Corporation, Educational Loan No Opt. Call Aa 265,700
Revenue Bonds, 6.125%, 9/01/02 (Alternative Minimum Tax)
2,000,000 City of Tucson, Arizona, General Obligation Refunding Bonds, Series No Opt. Call AAA 2,144,960
1995, 5.375%, 7/01/05
- -----------------------------------------------------------------------------------------------------------------------------------
California - 4.8%
California Statewide Communities Development Authority, Certificates of
Participation Refunding (Rio Bravo-Fresno Project), 1999 Series A:
1,000,000 5.300%, 12/01/99 No Opt. Call N/R 1,003,970
3,000,000 5.400%, 12/01/00 No Opt. Call N/R 3,029,310
3,000,000 5.450%, 12/01/01 No Opt. Call N/R 3,031,350
2,000,000 5.550%, 12/01/02 No Opt. Call N/R 2,030,360
2,000,000 5.600%, 12/01/03 No Opt. Call N/R 2,033,800
4,380,000 Central Joint Powers Health Financing Authority, Certificates of No Opt. Call Baa1 4,567,376
Participation, Series 1993 (Community Hospital of Central California),
5.250%, 2/01/04
1,250,000 Long Beach Aquarium of the Pacific, Revenue Bonds (Aquarium of the No Opt. Call BBB 1,337,788
Pacific Project), 1995 Series A, 5.750%, 7/01/05
Sacramento Cogeneration Authority, Cogeneration Project Revenue Bonds
(Procter & Gamble Project), 1995 Series:
1,000,000 5.900%, 7/01/02 No Opt. Call BBB- 1,055,760
500,000 6.000%, 7/01/03 No Opt. Call BBB- 535,940
500,000 7.000%, 7/01/04 No Opt. Call BBB- 561,325
4,800,000 Southern California Public Power Authority, Power Project Revenue Bonds, No Opt. Call AAA 5,240,592
1996 Subordinate Refunding, Series A (Palo Verde Project), 5.500%,
7/01/05
1,500,000 Taft Public Financing Authority, Lease Revenue Bonds, 1997 Series A No Opt. Call A2 1,592,145
(Community Correctional Facility Acquisition Project), 5.500%, 1/01/06
- -----------------------------------------------------------------------------------------------------------------------------------
Colorado - 4.3%
9,000,000 Public Highway Authority, Capital Improvement Trust Fund Highway 8/05 at 95 29/32 Aaa 6,647,130
Revenue Bonds (E-470 Project), Senior Bonds Arapahoe County,
Colorado, 0.000%, 8/31/06 (Pre-refunded to 8/31/05)
City of Arvada, Colorado, Limited Sales and Use Tax Revenue Bonds,
Series 1991:
500,000 6.300%, 6/01/99 No Opt. Call N/R*** 501,225
400,000 6.400%, 6/01/00 No Opt. Call N/R*** 412,464
2,475,000 Colorado Health Facilities Authority, Revenue Bonds, Series 1995 No Opt. Call A- 2,629,787
(Covenant Retirement Communities Inc.), 5.650%, 12/01/04
Colorado Housing and Finance Authority, Single-Family Housing
Revenue Refunding Bonds, 1991 Series A:
1,515,000 0.000%, 11/01/01 No Opt. Call Aa1 1,326,625
3,515,000 0.000%, 11/01/02 No Opt. Call Aa1 2,908,592
6,475,000 City and County of Denver, Colorado, Airport System Revenue Bonds, No Opt. Call AAA 6,991,381
Series 1996B, 5.750%, 11/15/04 (Alternative Minimum Tax)
1,400,000 Eagle County Air Terminal Corporation, Airport Terminal Project No Opt. Call N/R 1,477,798
Revenue Bonds, Series 1996, 6.750%, 5/01/06 (Alternative
Minimum Tax)
500,000 Hyland Hills Park and Recreation District, Adams County, Colorado, No Opt. Call N/R 512,635
Special Revenue Refunding and Improvement Bonds, Series 1996A,
5.400%, 12/15/00
</TABLE>
25
<PAGE>
Portfolio of Investments
Nuveen Flagship Limited Term Municipal Bond Fund (continued)
April 30, 1999
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Connecticut - 4.1%
City of Bridgeport, Connecticut, General Obligation Refunding Bonds,
1996 Series A:
$ 4,650,000 5.250%, 9/01/04 No Opt. Call AAA $ 4,959,923
1,000,000 6.000%, 9/01/05 No Opt. Call AAA 1,109,430
2,800,000 State of Connecticut Health and Educational Facilities Authority, No Opt. Call BBB- 2,943,332
Revenue Bonds, Quinnipiac College Issue, Series D, 5.625%,
7/01/03
1,000,000 State of Connecticut Health and Educational Facilities Authority, No Opt. Call BBB 1,032,260
Revenue Bonds, Hospital for Special Care Issue, Series B, 5.125%,
7/01/07
Connecticut Development Authority, First Mortgage Gross Revenue Health
Care Project Refunding Bonds (Church Homes, Inc., Congregational Avery
Heights Project), 1997 Series:
780,000 5.100%, 4/01/04 No Opt. Call BBB 800,974
1,100,000 5.200%, 4/01/05 No Opt. Call BBB 1,136,872
1,135,000 5.300%, 4/01/06 No Opt. Call BBB 1,178,380
615,000 City of New Haven, Connecticut, General Obligation Bonds, Issue of No Opt. Call AAA 660,123
1992, 9.250%, 3/01/02
5,000,000 Housing Authority of the City of Stamford, Connecticut, Multifamily No Opt. Call A3 4,973,200
Housing Revenue Refunding Bonds (The Fairfield Apartments Project),
Series 1998, 4.750%, 12/01/28 (Mandatory put 12/01/08)
3,775,000 West Haven Housing Authority, Connecticut, Multifamily Housing Revenue 1/01 at 100 N/R 3,830,266
Bonds, Series 1998B (Meadows Landing Apartments), 6.000%, 1/01/02
(Alternative Minimum Tax)
- -----------------------------------------------------------------------------------------------------------------------------------
District of Columbia - 0.1%
500,000 District of Columbia Redevelopment Land Agency, Sports Arena Special Tax No Opt. Call BBB+ 504,069
Revenue Bonds (Series 1996), 5.300%, 11/01/99
- -----------------------------------------------------------------------------------------------------------------------------------
Florida - 1.5%
350,000 North Springs Improvment District (Broward County, Florida), Water and No Opt. Call N/R 364,522
Sewer Revenue Bonds, Series 1991, 7.900%, 10/01/01
4,940,000 Housing Finance Authority of Polk County (Florida), Multifamily Housing 7/05 at 101 AAA 5,161,510
Revenue Bonds (Winter Oaks Apartments Project), Series 1997A, 5.250%,
7/01/22 (Mandatory put 7/01/07)
2,370,000 Sanford Airport Authority (Florida), Industrial Development Revenue Bonds No Opt. Call N/R 2,471,081
(Central Florida Terminals Inc. Project), Series 1995A, 7.300%, 5/01/04
(Alternative Minimum Tax)
- -----------------------------------------------------------------------------------------------------------------------------------
Georgia - 0.6%
3,000,000 City of Atlanta, Georgia, Airport Facilities Revenue Refunding Bonds, No Opt. Call AAA 3,405,930
Series 1996, 6.500%, 1/01/06
- -----------------------------------------------------------------------------------------------------------------------------------
Illinois - 2.4%
290,000 DeKalb, Illinois, Home Rule Units Single Family Mortgage Revenue No Opt. Call Aaa 292,854
Bonds (GNMA Mortgage-Backed Securities Program), Series 1991A, 6.700%,
12/01/99 (Alternative Minimum Tax)
970,000 Illinois Health Facilities Authority, Revenue Refunding Bonds, No Opt. Call AA 988,682
Galesburg Cottage Hospital, 5.400%, 5/01/00
565,000 Illinois Health Facilities Authority, Revenue Bonds, Series 1996 No Opt. Call BBB 579,001
(Mercy Hospital and Medical Center Project), 5.600%, 1/01/02
1,500,000 Illinois Health Facilities Authority, Revenue Refunding Bonds, No Opt. Call A- 1,583,685
Series 1996B (Sarah Bush Lincoln Health Center), 5.500%,
2/15/06
Illinois Health Facilities Authority, Revenue Bonds (Victory Health
Service), Series 1997A:
945,000 5.000%, 8/15/05 No Opt. Call A- 975,023
995,000 5.000%, 8/15/06 No Opt. Call A- 1,024,631
1,045,000 5.750%, 8/15/07 No Opt. Call A- 1,125,120
605,000 5.750%, 8/15/08 8/07 at 101 A- 651,155
1,350,000 Illinois Health Facilities Authority, Revenue Bonds, Series 1998B 8/99 at 102 N/R*** 1,392,471
(ServantCor), 7.500%, 8/15/01 (Pre-refunded to 8/15/99)
3,000,000 State of Illinois, General Obligation Bonds, Series of March 1992 10/02 at 102 AA 3,271,350
1992 (Full Faith and Credit), 6.200%, 10/01/04
1,065,000 Village of Romeoville, Will County, Illinois, General Obligation No Opt. Call N/R 1,095,331
Refunding Bonds (Alternate Revenue Source), Series 1991-B,
7.850%, 1/01/01
</TABLE>
26
<PAGE>
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- -----------------------------------------------------------------------------------------------------------------------------------
<C> <S> <C> <C> <C>
Indiana - 1.3%
City of Goshen, Indiana, Revenue Refunding Bonds, Series 1998
(Greencroft Obligated Group)
$ 715,000 5.150%, 8/15/05 No Opt. Call N/R $ 715,172
790,000 5.250%, 8/15/07 No Opt. Call N/R 787,203
680,000 5.300%, 8/15/08 No Opt. Call N/R 677,382
775,000 5.350%, 8/15/09 8/08 at 101 N/R 769,854
Indiana Bond Bank Special Program Bonds, Series 1997B (Hendricks
County Redevelopment Authority, Pittboro Project):
1,525,000 5.250%, 2/01/03 No Opt. Call AA- 1,584,521
1,075,000 5.400%, 2/01/04 No Opt. Call AA- 1,127,288
1,250,000 Valparaiso Multi-School Building Corporation (Porter County, No Opt. Call AAA 1,314,512
Indiana), First Mortgage Bonds, Series 1992, 6.100%, 7/01/01
- -----------------------------------------------------------------------------------------------------------------------------------
Iowa - 1.7%
Iowa Student Loan Liquidity Corporation, Iowa Partnership Loan
Revenue Bonds, 1992 Series:
600,000 5.850%, 7/01/99 (Alternative Minimum Tax) No Opt. Call A 602,256
325,000 6.000%, 7/01/00 (Alternative Minimum Tax) No Opt. Call A 333,496
600,000 6.100%, 7/01/01 (Alternative Minimum Tax) No Opt. Call A 625,566
650,000 6.200%, 7/01/02 (Alternative Minimum Tax) No Opt. Call A 688,116
7,000,000 Iowa Student Loan Liquidity Corporation, Student Loan Revenue No Opt. Call AAA 7,049,840
Refunding Bonds, 1998 Series J, 4.800%, 6/01/09
(Alternative Minimum Tax)
- -----------------------------------------------------------------------------------------------------------------------------------
Kentucky - 6.8%
850,000 City of Berea, Kentucky, Berea College General Obligation Bonds, No Opt. Call Aaa 860,328
Series 1998, 4.800%, 7/01/08 (Alternative Minimum Tax)
3,180,000 County of Christian, Kentucky, Hospital Revenue and Refunding No Opt. Call A- 3,406,003
Bonds, Series 1997A, Jennie Stuart Medical Center, 5.500%,
7/01/06
City of Jeffersontown, Kentucky, Public Projects Refunding and
Improvements, Certificates of Participation:
235,000 4.650%, 11/01/02 No Opt. Call A 242,701
520,000 4.750%, 11/01/03 No Opt. Call A 541,471
Kenton County Water District No. 1, Water District Revenue
Bonds, Series 1995B:
475,000 5.600%, 2/01/03 No Opt. Call AAA 505,723
500,000 5.600%, 2/01/05 No Opt. Call AAA 540,050
Kentucky Development Finance Authority, Sisters of Charity of
Nazareth Health Corporation Revenue Refunding Bonds, Series 1991:
1,330,000 6.000%, 11/01/01 No Opt. Call A1*** 1,403,296
2,720,000 6.600%, 11/01/06 (Pre-refunded to 11/01/01) 11/01 at 102 A1*** 2,961,672
Kentucky Economic Development Finance Authority, Hospital System
Refunding and Improvement Revenue Bonds, Series 1997
(Appalachian Regional Healthcare, Inc. Project):
2,670,000 5.300%, 10/01/05 No Opt. Call BBB 2,713,841
1,315,000 5.400%, 10/01/06 No Opt. Call BBB 1,339,301
1,460,000 Kentucky Higher Education Student Loan Corporation, Insured Student No Opt. Call Aaa 1,590,801
Loan Revenue Bonds, 1991 Series B,
6.800%, 6/01/03 (Alternative Minimum Tax)
180,000 Kentucky Infrastructure Authority, Wastewater Revolving Fund Program, No Opt. Call A 189,740
Revenue Refunding Bonds, 1995 Series C, 5.300%, 6/01/03
Kentucky Infrastructure Authority, Governmental Agencies Program,
Revenue and Revenue Refunding Bonds, 1995 Series H:
1,945,000 5.300%, 8/01/03 No Opt. Call A 2,054,153
675,000 5.400%, 8/01/04 No Opt. Call A 719,429
1,000,000 5.500%, 8/01/05 No Opt. Call A 1,075,040
1,000,000 The Turnpike Authority of Kentucky, Resource Recovery Road Revenue No Opt. Call A+ 1,289,910
Refunding Bonds, 1985 Series A,
9.625%, 7/01/05
</TABLE>
----
27
<PAGE>
Portfolio of Investments
Nuveen Flagship Limited Term Municipal Bond Fund (continued)
April 30, 1999
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Kentucky (continued)
Regional Airport Authority of Louisville and Jefferson County,
Kentucky, Airport System Revenue Bonds, 1997 Series A:
$ 1,375,000 5.750%, 7/01/00 (Alternative Minimum Tax) No Opt. Call AAA $ 1,409,994
455,000 5.750%, 7/01/01 (Alternative Minimum Tax) No Opt. Call AAA 473,619
1,535,000 5.750%, 7/01/02 (Alternative Minimum Tax) No Opt. Call AAA 1,620,914
3,225,000 Mount Sterling, Kentucky, Lease Revenue Bonds (Kentucky League of No Opt. Call Aa 3,395,990
Cities Funding Program), Series 1993A, 5.625%, 3/01/03
10,800,000 City of Owensboro, Kentucky, Electric Light and Power System No Opt. Call AAA 8,968,320
Revenue Bonds, Series 1993A, 0.000%, 1/01/04
(Alternative Minimum Tax)
- -----------------------------------------------------------------------------------------------------------------------------------
Louisiana - 2.4%
6,000,000 Parish of East Baton Rouge, State of Louisiana, Pollution Control No Opt. Call A+ 6,252,360
Refunding Revenue Bonds (Hoechst Celanese Corporation Project),
Series 1993, 5.400%, 12/01/02
1,215,000 Louisiana Public Facilities Authority, Hospital Revenue Bonds No Opt. Call AAA 1,229,568
(Our Lady of Lourdes Regional Medical Center Project), Series
1992, 4.900%, 2/01/00
965,000 Louisiana Public Facilities Authority, Hospital Revenue Bonds No Opt. Call A3*** 1,020,092
(Womans Hospital Foundation Project), Series 1992, 6.750%,
10/01/02
2,500,000 Louisiana Offshore Terminal Authority, Deepwater Port Refunding No Opt. Call A 2,668,325
Revenue Bonds (LOOP INC. Project), First Stage Series 1992B,
6.100%, 9/01/02
Office Facilities Corporation (A Louisiana Non Profit Corporation),
Capital Facilities Bonds (Statewide Lease/Purchase Program), Series 1990:
400,000 7.250%, 12/01/99 No Opt. Call BBB+ 408,852
770,000 7.350%, 12/01/00 No Opt. Call BBB+ 813,297
Ouachita Parish, Louisiana, Hospital Service District No. 1,
Glenwood Regional Medical Center:
425,000 7.000%, 7/01/99 No Opt. Call A*** 427,516
300,000 7.250%, 7/01/00 No Opt. Call A*** 312,462
- -----------------------------------------------------------------------------------------------------------------------------------
Maine - 0.2%
1,210,000 Maine Educational Loan Marketing Corporation, Student Loan Revenue 5/02 at 101 A 1,261,594
Refunding Bonds, Series 1992, 6.600%, 5/01/05 (Alternative
Minimum Tax)
- -----------------------------------------------------------------------------------------------------------------------------------
Maryland - 1.1%
Maryland Energy Financing Administration, Limited Obligation
Solid Waste Disposal Revenue Bonds (Wheelabrator Water
Technologies-Baltimore L.L.C. Projects), 1996 Series:
2,280,000 5.650%, 12/01/03 (Alternative Minimum Tax) No Opt. Call A- 2,428,747
1,000,000 5.850%, 12/01/05 (Alternative Minimum Tax) No Opt. Call A- 1,084,520
2,400,000 Northeast Maryland Waste Disposal Authority, Resource Recovery No Opt. Call AAA 2,715,000
Revenue Refunding Bonds (Southwest Resource Recovery Facility),
Series 1993, 7.150%, 1/01/04
- -----------------------------------------------------------------------------------------------------------------------------------
Massachusetts - 4.4%
265,000 City of Brockton, Massachusetts, General Obligation Bonds, No Opt. Call A2 270,107
5.350%, 6/15/00
Massachusetts Educational Financing Authority, Education Loan
Revenue Bonds, Issue E, Series 1995:
800,000 5.500%, 7/01/01 (Alternative Minimum Tax) No Opt. Call AAA 823,648
2,445,000 5.700%, 7/01/04 (Alternative Minimum Tax) No Opt. Call AAA 2,575,367
Massachusetts Educational Financing Authority, Education Loan
Revenue Bonds, Issue E, Series 1997B:
1,970,000 5.250%, 7/01/06 (Alternative Minimum Tax) No Opt. Call AAA 2,079,946
2,775,000 5.350%, 7/01/07 (Alternative Minimum Tax) 7/06 at 102 AAA 2,947,244
Massachusetts Municipal Wholesale Electric Company, Power Supply
System Revenue Bonds, 1992 Series A:
2,635,000 6.300%, 7/01/00 No Opt. Call Aaa 2,720,901
3,800,000 6.300%, 7/01/00 No Opt. Call AAA 3,923,880
1,000,000 The Commonwealth of Massachusetts, General Obligation Refunding No Opt. Call AA- 1,007,050
Bonds, Series 1992A, 6.100%, 8/01/99
</TABLE>
28
<PAGE>
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Massachusetts (continued)
$ 1,500,000 Massachusetts Health and Educational Facilities Authority, No Opt. Call AA- $ 1,539,000
Revenue Bonds, Partners HealthCare System Issue, Series B,
5.000%, 7/01/09
City of New Bedford, Massachusetts General Obligation Landfill
Closure Bonds, Series 1993:
600,000 5.250%, 3/01/00 No Opt. Call Baa3 608,430
600,000 5.400%, 3/01/01 No Opt. Call Baa3 615,906
600,000 5.500%, 3/01/02 No Opt. Call Baa3 622,926
2,500,000 The New England Education Loan Marketing Corporation, Student Loan No Opt. Call A1 2,643,600
Refunding Bonds, 1993 Series E, 5.625%, 7/01/04
(Alternative Minimum Tax)
415,000 City of Springfield, Massachusetts, General Obligation Refunding Bonds, No Opt. Call A 418,254
Series 1992A, 5.800%, 9/01/99
City of Springfield, Massachusetts, General Obligation School Project
Loan Act of 1948 Bonds, Series B:
815,000 5.800%, 9/01/99 No Opt. Call Baa3 821,341
250,000 6.100%, 9/01/02 No Opt. Call Baa3 265,193
- -----------------------------------------------------------------------------------------------------------------------------------
Michigan - 5.0%
3,315,000 The Economic Development Corporation of the City of Detroit, No Opt. Call AAA 3,405,732
Resource Recovery Revenue Bonds, Series 1991A, 6.350%, 5/01/00
(Alternative Minimum Tax)
3,000,000 Greater Detroit Resource Recovery Authority, Michigan, Resource No Opt. Call AAA 3,221,970
Revenue Refunding Bonds, Series 1996-A, 5.500%, 12/13/04
460,000 City of Madison Heights Tax Increment Finance Authority, No Opt. Call N/R 482,531
Michigan, Series 1991, 8.500%, 3/15/01
900,000 Michigan Higher Education Student Loan Authority, Student Loan No Opt. Call AAA 932,265
Revenue Bonds, Series XII-E, 6.375%, 10/01/00
(Alternative Minimum Tax)
2,000,000 Michigan Higher Education Student Loan Authority, Series XV-A, No Opt. Call Aa1 2,048,260
5.400%, 9/01/00 (Alternative Minimum Tax)
2,700,000 Michigan State Hospital Finance Authority, Michigan, Hospital No Opt. Call AAA 2,756,322
Revenue Refunding Bonds (St. John Hospital), Series 1993A,
5.400%, 5/15/00
2,370,000 Michigan State Hospital Finance Authority, Hospital Revenue No Opt. Call BBB 2,439,204
Refunding Bonds (Gratiot Community Hospital, Alma, Michigan),
Series 1995, 5.300%, 10/01/01
1,000,000 Michigan State Hospital Finance Authority, Revenue Refunding Bonds No Opt. Call AA- 1,104,380
(Mercy Health Services Obligated Group), 1997 Series T,
6.000%, 8/15/06
Michigan State Housing Development Authority, Rental Housing
Revenue Bonds, 1995 Series B:
3,085,000 5.450%, 4/01/05 No Opt. Call AAA 3,237,831
3,325,000 5.450%, 10/01/05 6/05 at 102 AAA 3,501,757
4,095,000 Pontiac, Michigan, Hospital Finance Authority, Hospital Revenue 8/00 at 100 BBB- 4,163,264
Refunding, Nomc Obligation Group, 5.800%, 8/01/03
- -----------------------------------------------------------------------------------------------------------------------------------
Mississippi - 0.6%
Mississippi Hospital Equipment and Facilities Authority, Revenue
Refunding Bonds, Series 1995 (Mississippi Baptist Medical Center):
1,690,000 5.350%, 5/01/03 No Opt. Call AAA 1,777,762
1,000,000 5.400%, 5/01/04 No Opt. Call AAA 1,059,330
- -----------------------------------------------------------------------------------------------------------------------------------
Missouri - 0.5%
Health and Educational Facilities Authority of the State of Missouri,
Health Facilities Revenue Bonds (Lutheran Senior Services), Series 1997:
500,000 5.200%, 2/01/04 No Opt. Call N/R 517,275
600,000 5.300%, 2/01/05 No Opt. Call N/R 627,918
600,000 5.400%, 2/01/06 No Opt. Call N/R 628,080
700,000 5.500%, 2/01/07 No Opt. Call N/R 736,673
350,000 The City of St. Louis, Missouri, Regional Convention and Sports No Opt. Call N/R 362,544
Complex Authority, Convention and Sports Facility Project Bonds,
Series C of 1991, 7.750%, 8/15/01
</TABLE>
29
<PAGE>
Portfolio of Investments
Nuveen Flagship Limited Term Municipal Bond Fund (continued)
April 30, 1999
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Montana - 2.0%
City of Forsyth, Rosebud County, Montana, Pollution Control Revenue
Refunding Bonds (Portland General Electric Company Projects),
Series 1998B:
$ 7,500,000 4.750%, 5/01/33 (Alternative Minimum Tax) (Mandatory put 5/01/03) No Opt. Call A- $ 7,633,950
3,000,000 4.600%, 5/01/33 (Mandatory put 5/01/03) No Opt. Call A- 3,048,210
- -----------------------------------------------------------------------------------------------------------------------------------
Nebraska - 2.3%
7,500,000 American Public Energy Agency, Gas Supply Revenue Bonds No Opt. Call AA- 7,520,325
(Nebraska Public Gas Agency-Western A Project), 1999 Series A,
4.450%, 6/01/08
5,000,000 Energy America (Nebraska), Natural Gas Revenue Bonds (Nebraska Public No Opt. Call N/R 4,973,650
Gas Agency Project), Series 1998B, 5.450%, 4/15/08
- -----------------------------------------------------------------------------------------------------------------------------------
New Hampshire - 2.9%
505,000 New Hampshire Higher Educational and Health Facilities Authority, No Opt. Call A 531,376
Hospital Revenue Bonds, St. Joseph Hospital Issue, Series 1991,
7.250%, 1/01/01
New Hampshire Housing Finance Authority, Single Family Residential
Mortgage Bonds, 1991 Series D:
270,000 6.350%, 1/01/00 (Alternative Minimum Tax) No Opt. Call Aa3 273,154
260,000 6.450%, 1/01/01 (Alternative Minimum Tax) No Opt. Call Aa3 266,991
Business Finance Authority of the State of New Hampshire, Pollution
Control Refunding Revenue Bonds (The United Illuminating Company
Project - 1997 Series A):
10,000,000 4.550%, 7/01/27 (Alternative Minimum Tax) (Mandatory put 2/01/04) No Opt. Call BBB- 10,008,300
5,000,000 4.350%, 7/01/27 (Alternative Minimum Tax) (Mandatory put 2/01/02) No Opt. Call BBB- 4,992,900
- -----------------------------------------------------------------------------------------------------------------------------------
New Jersey - 3.3%
1,410,000 New Jersey Economic Development Authority, Electric Energy Facility No Opt. Call N/R 1,411,763
Revenue Bonds (Vineland Cogeneration Limited Partnership Project),
Series 1992, 6.750%, 6/01/99 (Alternative Minimum Tax)
New Jersey Health Care Facilities Financing Authority,
Bayonne Hospital Obligated Group Revenue Bonds, Series 1994:
860,000 5.750%, 7/01/00 No Opt. Call AAA 881,935
1,000,000 5.800%, 7/01/01 No Opt. Call AAA 1,044,126
790,000 5.900%, 7/01/02 No Opt. Call AAA 840,023
4,300,000 New Jersey Economic Development Authority, Insured Revenue Bonds No Opt. Call AAA 4,606,117
(Educational Testing Service Issue), Series 1995B, 5.500%, 5/15/05
New Jersey Economic Development Authority, First Mortgage Revenue
Bonds (Franciscan Oaks Project), Series 1997:
1,420,000 5.300%, 10/01/05 No Opt. Call N/R 1,466,931
830,000 5.400%, 10/01/06 No Opt. Call N/R 860,901
New Jersey Higher Educational Facilities Authority, Higher
Educational Facilities Revenue Bonds, Saint Peters College
Issue, 1992 Series B:
295,000 6.100%, 7/01/00 No Opt. Call BBB 303,646
355,000 6.200%, 7/01/01 No Opt. Call BBB 373,354
New Jersey Educational Facilities Authority, Stevens Institute of
Technology Issue Revenue Bonds, 1992 Series A:
1,155,000 6.000%, 7/01/99 No Opt. Call A 1,160,013
1,275,000 6.100%, 7/01/00 No Opt. Call A 1,311,414
995,000 6.200%, 7/01/01 No Opt. Call A 1,043,725
1,165,000 6.300%, 7/01/02 No Opt. Call A 1,245,478
1,200,000 New Jersey Educational Facilities Authority, Revenue Bonds, No Opt. Call BBB 1,221,120
Saint Peters College Issue, 1998 Series B, 5.000%, 7/01/08
</TABLE>
30
<PAGE>
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
New York -- 16.6%
Albany Housing Authority, City of Albany, New York, Limited
Obligation Bonds, Series 1995:
$ 500,000 5.100%, 10/01/01 No Opt. Call Baa1 $ 508,400
700,000 5.250%, 10/01/02 No Opt. Call Baa1 716,555
750,000 5.400%, 10/01/03 No Opt. Call Baa1 773,445
750,000 5.500%, 10/01/04 No Opt. Call Baa1 774,938
1,000,000 5.600%, 10/01/05 No Opt. Call Baa1 1,036,720
500,000 5.700%, 10/01/06 10/05 at 102 Baa1 520,600
700,000 5.850%, 10/01/07 10/05 at 102 Baa1 726,565
Cattaraugus County, New York, Industrial Development Agency, Civic
Facility Revenue Bonds (St. Bonaventure University Construction Project),
Series 1998B:
1,635,000 5.000%, 9/15/07 No Opt. Call BBB 1,656,680
1,720,000 5.000%, 9/15/08 No Opt. Call BBB 1,732,057
City of Jamestown, Chautauqua County, New York, Public Improvement
Serial Bonds, 1991 Series A:
150,000 7.000%, 3/15/04 No Opt. Call Baa2 167,736
750,000 7.000%, 3/15/05 No Opt. Call Baa2 850,560
1,000,000 Metropolitan Transportation Authority, New York Transit Service Contract No Opt. Call BBB+ 1,079,350
Bonds, Series N, 6.625%, 7/10/02
1,280,000 The City of New York, General Obligation Bonds, Fiscal 1988 Series A, No Opt. Call Aaa 1,311,526
8.250%, ll/01/99
2,750,000 The City of New York, General Obligation Bonds, Fiscal 1991 Series B, No Opt. Call A- 3,401,640
8.250%, 6/01/06
1,000,000 The City of New York, General Obligation Bonds, Fiscal 1996 Series E, No Opt. Call A- 1,102,690
6.500%, 2/15/04
The City of New York, General Obligation Bonds, Fiscal 1996 Series G:
3,000,000 5.750%, 2/01/06 No Opt. Call A- 3,183,930
500,000 5.750%, 2/01/06 No Opt. Call A- 543,130
3,000,000 The City of New York, General Obligation Bonds, Fiscal 1997 Series H, No Opt. Call A- 3,187,230
5.400%, 8/01/04
4,000,000 The City of New York, General Obligation Bonds, Fiscal 1995 Series F, No Opt. Call Aaa 4,260,360
6.100%, 2/15/02
5,000,000 The City of New York, General Obligation Bonds, Fiscal 1997 Series I, No Opt. Call A- 5,381,600
5.625%, 4/15/05
The City of New York, General Obligation Bonds, Fiscal 1999 Series H:
3,860,000 4.750%, 3/15/07 No Opt. Call A- 3,957,967
2,195,000 5.000%, 3/15/08 No Opt. Call A- 2,283,437
2,155,000 5.000%, 3/15/09 No Opt. Call A- 2,232,214
1,000,000 Dormitory Authority of the State of New York, State University 5/00 at 102 A- 1,056,500
Educational Facilities Revenue Bonds, Series 1990A, 7.400%, 5/15/01
4,155,000 Dormitory Authority of the State of New York, Revenue Bonds, City No Opt. Call Baa1 4,265,191
University Issue, Series U, 5.875%, 7/01/00
2,900,000 Dormitory Authority of the State of New York, Department of Health of No Opt. Call BBB+ 3,077,886
the State of New York Refunding Bonds, 1990 Issue, 6.750%, 7/01/01
Dormitory Authority of the State of New York, State University Educational
Facilities Revenue Bonds, Series 1995A:
6,500,000 5.250%, 5/15/01 No Opt. Call A- 6,701,435
2,000,000 6.500%, 5/15/05 No Opt. Call A- 2,242,600
Dormitory Authority of the State of New York, NYACK Hospital Revenue
Bonds, Series 1996:
1,000,000 5.500%, 7/01/00 No Opt. Call Baa 1,018,700
1,000,000 6.000%, 7/01/06 No Opt. Call Baa 1,083,840
3,315,000 Dormitory Authority of the State of New York, City University System No Opt. Call BBB+ 3,593,460
Consolidated Revenue Bonds, 1996 Series 2, 6.000%, 7/01/04
1,665,000 New York State Energy Research and Development Authority, State Service No Opt. Call BBB+ 1,651,064
Contract Revenue Bonds, Series 1999A (Western New York Nuclear Service
Center Project), 4.500%, 4/01/08
1,740,000 New York State Energy Research and Development Authority, State Service No Opt. Call BBB+ 1,729,003
Contract Revenue Bonds, Series 1999A (Western New York Nuclear Service
Center Project), 4.625%, 4/01/09
5,000,000 New York State Housing Finance Agency, Health Facilities Revenue Bonds No Opt. Call A- 5,373,200
(New York City), 1996 Series A Refunding, 5.875%, 5/01/04
2,000,000 New York State Thruway Authority, Local Highway and Bridge Service 4/06 at 102 BBB+ 2,154,640
Contract Bonds, Series 1996, 5.625%, 4/01/07
</TABLE>
31
<PAGE>
Portfolio of Investments
Nuveen Flagship Limited Term Municipal Bond Fund (continued)
April 30, 1999
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
New York (continued)
New York State Urban Development Corporation, Project Revenue
Bonds (Center for Industrial Innovation), 1995 Refunding Series:
$ 2,405,000 5.300%, 1/01/04 No Opt. Call BBB+ $ 2,521,691
1,265,000 6.250%, 1/01/05 No Opt. Call BBB+ 1,388,856
1,000,000 New York State Urban Development Corporation, Correctional No Opt. Call BBB+ 1,034,500
Capital Series, Facilities Revenue Bonds, 1993 Refunding
Series, 5.250%, 1/01/02
Onondaga County Resource Recovery Agency, New York, System
Revenue Bonds (Development Costs-19 Series):
480,000 6.100%, 5/01/99 No Opt. Call Baa1 480,014
630,000 6.200%, 5/01/00 No Opt. Call Baa1 637,289
3,700,000 The Port Authority of New York and New Jersey, Special No Opt. Call N/R 4,093,976
Project Bonds, Series 4, KIAC Partners Project, 7.000%,
10/01/07 (Alternative Minimum Tax)
3,035,000 The Port Authority of New York and New Jersey, Special No Opt. Call AAA 3,350,944
Project Bonds, Series 6, JFK International Air Terminal LLC
Project, 6.000%, 12/01/05 (Alternative Minimum Tax)
1,400,000 Suffolk County Industrial Development Agency, New York, 1998
Industrial Development Revenue Bonds (Nissequogue Cogen No Opt. Call N/R 1,390,144
Partners Facility), 4.875%, 1/01/08 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
North Carolina - 1.1%
5,475,000 North Carolina Municipal Power Agency Number 1, Catawba Electric 1/03 at 102 A- 5,894,714
Revenue Bonds, Series 1992, 6.000%, 1/01/05
- ------------------------------------------------------------------------------------------------------------------------------------
Ohio - 7.0%
8,245,000 Akron, Bath and Copley Joint Township Hospital District, Ohio, No Opt. Call Baa1 8,297,686
Hospital Facilities Revenue Bonds, Series 1998A (Summa Health
System Project), 5.000%, 11/15/08
City of Barberton, Ohio, Hospital Facilities Revenue Bonds, Series
1992 (The Barberton Citizens Hospital Company Project):
750,000 6.400%, 1/01/00 No Opt. Call A*** 765,300
500,000 6.550%, 1/01/01 No Opt. Call A*** 523,455
City of Cambridge, Ohio, Hospital Revenue Refunding Bonds, Series
1991 (Guernsey Memorial Hospital Project):
595,000 7.650%, 12/01/99 No Opt. Call BBB 608,322
640,000 7.750%, 12/01/00 No Opt. Call BBB 677,638
680,000 7.850%, 12/01/01 No Opt. Call BBB 741,234
Cleveland-Cuyahoga County Port Authority, Subordinate Refunding
Revenue Bonds, Series 1997 (Rock and Roll Hall of Fame and
Museum Project):
850,000 5.000%, 12/01/01 No Opt. Call N/R 869,499
1,000,000 5.100%, 12/01/02 No Opt. Call N/R 1,027,590
750,000 5.350%, 12/01/04 No Opt. Call N/R 781,935
335,000 5.600%, 12/01/06 No Opt. Call N/R 354,236
135,000 County of Cuyahoga, Ohio, Health Care Facilities Revenue Bonds, No Opt. Call N/R 135,441
Series 1990 (Altenheim Project), 8.750%, 6/01/99
County of Cuyahoga, Ohio, Hospital Revenue Bonds (Meridia Health
System), Series 1995:
500,000 5.750%, 8/15/00 No Opt. Call AAA 514,875
795,000 5.850%, 8/15/01 No Opt. Call AAA 834,949
735,000 5.950%, 8/15/02 No Opt. Call AAA 787,530
County of Lucas, Ohio, Hospital Facilities Revenue Bonds,
Series 1993 (Flower Hospital):
370,000 5.800%, 12/01/01 No Opt. Call N/R*** 389,122
790,000 5.900%, 12/01/02 No Opt. Call N/R*** 845,782
435,000 6.000%, 12/01/03 No Opt. Call N/R*** 473,141
5,195,000 County of Lucas, Ohio, Hospital Revenue Refunding Bonds, No Opt. Call AAA 5,745,254
Series 1996 (ProMedica Healthcare Obligated Group), 6.000%,
11/15/05
1,000,000 Miami County, Ohio, Hospital Facilities Revenue Refunding and No Opt. Call BBB 1,057,740
Improvement Bonds (Upper Valley Medical Center), Series
1996C, 6.000%, 5/15/06
885,000 State of Ohio, State Economic Development Revenue Bonds (Ohio 6/99 at 101 A- 904,674
Enterprise Bond Fund), Series 1991-2 and Series 1991-3
(Superior Forge and Steel Corporation), 7.250%, 6/01/01
(Alternative Minimum Tax)
</TABLE>
32
<PAGE>
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Ohio (continued)
$3,825,000 State of Ohio, Elementary and Secondary Education Capital Facilities Bonds, No Opt. Call AAA $4,050,522
Series 1995A, 5.700%, 6/01/02
County of Sandusky, Ohio, Hospital Facilities Revenue Refunding Bonds,
Series 1998 (Memorial Hospital):
910,000 4.500%, 1/01/01 No Opt. Call BBB- 919,282
1,030,000 4.600%, 1/01/02 No Opt. Call BBB- 1,043,524
1,375,000 4.700%, 1/01/03 No Opt. Call BBB- 1,394,209
1,460,000 4.800%, 1/01/04 No Opt. Call BBB- 1,482,542
1,030,000 4.900%, 1/01/05 No Opt. Call BBB- 1,050,559
830,000 5.000%, 1/01/06 No Opt. Call BBB- 850,169
500,000 5.050%, 1/01/07 No Opt. Call BBB- 512,065
750,000 5.100%, 1/01/09 1/08 at 102 BBB- 768,825
- ------------------------------------------------------------------------------------------------------------------------------------
Oklahoma - 0.6%
3,120,000 Oklahoma Industries Authority, Hospital Revenue Bonds (Deaconess Health No Opt. Call BBB 3,235,877
Care Corporation Project), Series 1997A, 5.250%, 10/01/07
- ------------------------------------------------------------------------------------------------------------------------------------
Pennsylvania - 10.4%
5,000,000 County of Allegheny, Pennsylvania, Airport Revenue Refunding Bonds, No Opt. Call AAA 5,323,300
Series 1997A (Pittsburgh International Airport), 5.500%, 1/01/05
(Alternative Minimum Tax)
Allegheny County Hospital Development Authority (Allegheny County,
Pennsylvania), Hospital Revenue Bonds, Series 1991A (St. Margaret
Memorial Hospital):
400,000 6.700%, 10/01/99 No Opt. Call BBB+*** 405,640
400,000 6.800%, 10/01/00 No Opt. Call BBB+*** 418,280
3,830,000 Delaware County Authority, Pennsylvania, Health Facilities Revenue 11/05 at 100 Aaa 4,225,448
Bonds, Series 1993A (Mercy Health Corporation of Southeastern
Pennsylvania Obligated Group), 6.000%, 11/15/07 (Pre-refunded
to 11/15/05)
Delaware County Industrial Development Authority (Pennsylvania),
Refunding Revenue Bonds, Series A 1997 (Resource Recovery Facility):
4,000,000 6.000%, 1/01/03 No Opt. Call A- 4,129,560
4,000,000 6.500%, 1/01/08 No Opt. Call A- 4,281,040
1,500,000 Monroeville, Pennsylvania, Hospital Authority, Hospital Revenue No Opt. Call N/R 1,441,875
Refunding Bonds, Forbes Health System, 5.750%, 10/01/05
335,000 Montgomery County Higher Education and Health Authority, Pennsylvania, No Opt. Call AAA 341,703
Hospital Facilities Revenue Bonds, Series of 1991 (Pottstown Memorial
Medical Center Project), 7.000%, 11/15/99
2,500,000 Pennsylvania Intergovernmental Cooperation Authority, Special Tax Revenue No Opt. Call AAA 2,572,425
Bonds (City of Philadelphia Funding Program), Series of 1992,
6.000%, 6/15/00
City of Philadelphia, Pennsylvania, Gas Works Revenue Bonds, Fourteenth
Series:
3,600,000 5.600%, 7/01/99 No Opt. Call BBB 3,612,816
3,425,000 5.700%, 7/01/00 No Opt. Call BBB 3,504,289
700,000 Philadelphia Hospital and Higher Educational Facilities Authority of No Opt. Call BBB+ 703,234
Philadelphia, Revenue Refunding Bonds, Series 1992 (Philadelphia MR
Project), 5.300%, 8/01/99
1,095,000 Redevelopment Authority of the City of Philadelphia, Pennsylvania, No Opt. Call N/R 1,088,123
Multifamily Housing Mortgage Revenue Bonds, Series 1998A (Cricket
Court Commons Project), 5.600%, 4/01/08 (Alternative Minimum Tax)
3,990,000 The School District of Philadelphia, Pennsylvania, General Obligation No Opt. Call AAA 4,265,031
Bonds, Series A of 1994, 5.450%, 7/01/04
1,080,000 The School District of Philadelphia, Pennsylvania, General Obligation No Opt. Call AAA 1,081,220
Bonds, Series A of 1992, 6.050%, 5/15/99
5,000,000 City of Philadelphia, Pennsylvania, Water and Wastewater Revenue Bonds, No Opt. Call AAA 5,277,400
Series 1993, 5.150%, 6/15/04
Philadelphia, Pennsylvania, Hospitals and Higher Education Facilities
Authority, Hospital Revenue Refunding:
3,490,000 5.850%, 7/01/02 No Opt. Call BBB+*** 3,697,795
2,020,000 6.050%, 7/01/04 No Opt. Call BBB+*** 2,203,153
2,000,000 6.150%, 7/01/05 No Opt. Call BBB+*** 2,209,320
</TABLE>
33
<PAGE>
Portfolio of Investments
Nuveen Flagship Limited Term Municipal Bond Fund (continued)
April 30, 1999
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Pennsylvania (continued)
$ 6,130,000 Westmoreland County Industrial Development Authority, Pennsylvania, No Opt. Call Baa3 $ 6,141,586
Hospital Revenue Bonds, Series 1998 (Citizens General Hospital),
4.750%, 7/01/03
- -----------------------------------------------------------------------------------------------------------------------------------
Rhode Island - 0.8%
4,035,000 Rhode Island Housing and Mortgage Finance Corporation, Multifamily No Opt. Call AAA 4,176,064
Housing Bonds, 1995 Series A, 5.350%, 7/01/03
- -----------------------------------------------------------------------------------------------------------------------------------
Tennessee - 1.9%
The Health and Educational Facilities Board of the Metropolitan
Government of Nashville and Davidson County, Tennessee, Revenue
Refunding Bonds, Series 1998 (The Blakford at Green Hills):
400,000 5.150%, 7/01/05 7/03 at 102 N/R 405,836
400,000 5.250%, 7/01/06 7/03 at 102 N/R 405,816
500,000 5.300%, 7/01/07 7/03 at 102 N/R 506,625
500,000 5.350%, 7/01/08 7/03 at 102 N/R 506,615
500,000 5.400%, 7/01/09 7/03 at 102 N/R 509,885
3,250,000 The Industrial Development Board of the Metropolitan Government of No Opt. Call N/R 3,368,723
Nashville and Davidson County, Tennessee, Industrial Development
Revenue Refunding and Improvement Bonds (Osco Treatment Systems, Inc.
Project), Series 1993, 6.000%, 5/01/03 (Alternative Minimum Tax)
4,650,000 The Tennessee Energy Acquisition Corporation, Gas Revenue Bonds, Series No Opt. Call AAA 4,686,456
1998B, 4.050%, 9/01/00
- -----------------------------------------------------------------------------------------------------------------------------------
Texas - 2.0%
1,575,000 Anderson County, Texas, Refunding Revenue Bonds (Coffield Prison Farm No Opt. Call AAA 1,602,972
Project), Series 1992 Supported by a Lease with the Texas Department
of Criminal Justice, 5.300%, 3/15/00
Brazos Higher Education Authority, Inc., Student Loan Revenue Refunding
Bonds, Series 1993A-1:
1,510,000 5.900%, 12/01/00 (Alternative Minimum Tax) No Opt. Call Aaa 1,562,171
1,075,000 6.050%, 12/01/01 (Alternative Minimum Tax) No Opt. Call Aaa 1,129,804
1,325,000 North Central Texas Health Facilities Development Corporation, Health 2/01 at 100 BBB 1,390,111
Facilities Development Revenue Bonds (C.C. Young Memorial Home
Project), Series 1996, 5.700%, 2/15/03
830,000 The City of Pasadena, Texas, Industrial Development Corporation, Economic 10/99 at 100 A 839,454
Development Revenue Bonds, Series 1991 (Universities Space Research
Association Lunar and Planetary Institute Project), 7.050%, 10/01/01
The State of Texas, Texas College Student Loan Senior Lien Revenue Bonds,
Series 1991:
460,000 7.000%, 4/01/00 (Alternative Minimum Tax) No Opt. Call A 473,450
960,000 7.100%, 4/01/01 (Alternative Minimum Tax) No Opt. Call A 1,010,870
Tyler Health Facilities Development Corporation, Texas, Hospital Revenue
Bonds (Mother Frances Hospital Regional HealthCare Center Project), Series
1997A:
1,650,000 5.125%, 7/01/05 7/02 at 100 Baa2 1,674,107
1,100,000 5.200%, 7/01/06 7/02 at 100 Baa2 1,115,234
- -----------------------------------------------------------------------------------------------------------------------------------
Vermont - 0.4%
Vermont Student Assistance Corporation, Education Loan Finance Program
Revenue Bonds, 1992 Series A-3:
1,000,000 5.900%, 12/15/00 (Alternative Minimum Tax) No Opt. Call AAA 1,034,819
1,000,000 6.050%, 12/15/01 (Alternative Minimum Tax) No Opt. Call AAA 1,050,909
- -----------------------------------------------------------------------------------------------------------------------------------
Virgin Islands - 1.7%
Virgin Islands Port Authority, Airport Revenue Bonds, Refunding Series
1998A:
1,590,000 4.050%, 9/01/01 (Alternative Minimum Tax) No Opt. Call A 1,592,115
2,960,000 4.450%, 9/01/04 9/02 at 101 BBB 2,965,386
2,500,000 4.500%, 9/01/05 9/02 at 101 BBB 2,500,349
2,070,000 Virgin Islands Water and Power Authority, Electric System Revenue and No Opt. Call N/R 2,179,005
Refunding Bonds, 1998 Series, 5.250%, 7/01/06
- -----------------------------------------------------------------------------------------------------------------------------------
Virginia - 1.2%
2,850,000 Newport News Redevelopment and Housing Authority, Multifamily Housing 5/05 at 102 AAA 3,021,740
Revenue Bonds (Fredericksburg-Oxford Project), Series 1997A, 5.550%,
5/01/27 (Mandatory put 5/01/07)
</TABLE>
- -----
34
<PAGE>
<TABLE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Virginia (continued)
$ 3,000,000 Virginia Public Building Authority, State Building Revenue Bonds, 8/04 at 101 AA*** $ 3,353,939
Series 1994A, 6.250%, 8/01/15 (Pre-refunded to 8/01/04)
- ------------------------------------------------------------------------------------------------------------------------------------
Washington - 0.9%
1,670,000 Washington Health Care Facilities Authority, Revenue Bonds, No Opt. Call AAA 1,793,646
Series 1992 (The Children's Hospital and Medical Center,
Seattle), 6.000%, 10/01/02
3,000,000 Washington Public Power Supply System, Nuclear Project No. 1 No Opt. Call Aa1 3,257,549
Refunding Revenue Bonds, Series 1993A, 5.700%, 7/01/06
- ------------------------------------------------------------------------------------------------------------------------------------
West Virginia - 0.8%
2,500,000 The County Commission of Pleasants County, West Virginia, Pollution No Opt. Call A 2,541,174
Control Revenue Bonds (West Penn Power Company-Pleasants
Station Project), 1998 Series D, 4.700%, 11/01/07
2,000,000 West Virginia Public Energy Authority, Energy Revenue Bonds 1/06 at 102 Aaa 2,051,399
(Morgantown Energy Associates Project), 1990 Series A, 5.050%,
7/01/08 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin - 0.4%
Wisconsin Health and Educational Facilities Authority, Revenue
Bonds, Series 1993A (Lutheran Hospital-La Crosse, Inc.):
1,100,000 5.200%, 2/15/00 No Opt. Call AAA 1,115,575
1,155,000 5.300%, 2/15/01 No Opt. Call AAA 1,186,185
- ------------------------------------------------------------------------------------------------------------------------------------
$521,380,000 Total Investments (cost $518,810,568) - 98.7% 538,458,966
============------------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 1.3% 6,928,944
---------------------------------------------------------------------------------------------------------------------
Net Assets - 100% $545,387,910
=====================================================================================================================
</TABLE>
* Optional Call Provisions (not covered by the report of independent public
accountants): Dates (month and year) and prices of the earliest optional
call or redemption. There may be other call provisions at varying prices at
later dates.
** Ratings (not covered by the report of independent public accountants):
Using the higher of Standard & Poor's or Moody's rating.
*** Securities are backed by an escrow or trust containing sufficient U.S.
government or U.S. government agency securities which ensures the timely
payment of principal and interest. Securities are normally considered to be
equivalent to AAA rated securities.
N/R Investment is not rated.
See accompanying notes to financial statements
______
35
<PAGE>
Statement of Net Assets
April 30, 1999
<TABLE>
<CAPTION>
All-American Intermediate Limited Term
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Assets
Investments in municipal securities, at market value (note 1) $419,264,973 $61,430,545 $538,458,966
Temporary investments in short-term municipal securities,
at amortized cost, which approximates market value (note 1) -- 1,000,000 --
Cash -- 1,125,313 --
Receivables:
Interest 6,815,747 889,737 8,537,967
Investments sold 3,705,027 165,000 1,680,000
Shares sold 3,060,715 38,801 2,455,436
Other assets 261,131 77,668 1,820
- --------------------------------------------------------------------------------------------------------------------------
Total assets 433,107,593 64,727,064 551,134,189
- --------------------------------------------------------------------------------------------------------------------------
Liabilities
Cash overdraft 352,828 -- 3,531,516
Payables:
Investments purchased 4,593,533 777,070 --
Shares redeemed 450,004 1,448,618 826,852
Accrued expenses:
Management fees (note 6) 134,634 10,975 193,922
12b-1 distribution and service fees (notes 1 and 6) 123,640 14,449 114,510
Other 124,673 53,934 168,600
Dividends payable 512,326 86,439 910,879
- --------------------------------------------------------------------------------------------------------------------------
Total liabilities 6,291,638 2,391,485 5,746,279
- --------------------------------------------------------------------------------------------------------------------------
Net assets (note 7) $426,815,955 $62,335,579 $545,387,910
==========================================================================================================================
Class A Shares (note 1)
Net assets $312,238,408 $51,773,415 $456,170,850
Shares outstanding 27,306,876 4,705,382 41,900,089
Net asset value and redemption price per share $ 11.43 $ 11.00 $ 10.89
Offering price per share (net asset value per share plus maximum sales
charge of 4.20%, 3.00% and 2.50%, respectively, of offering price) $ 11.93 $ 11.34 $ 11.17
==========================================================================================================================
Class B Shares (note 1)
Net assets $ 31,804,266 N/A N/A
Shares outstanding 2,780,221 N/A N/A
Net asset value, offering and redemption price per share $ 11.44 N/A N/A
==========================================================================================================================
Class C Shares (note 1)
Net assets $ 80,035,915 $ 9,855,152 $ 88,044,007
Shares outstanding 7,010,142 894,643 8,096,219
Net asset value, offering and redemption price per share $ 11.42 $ 11.02 $ 10.87
==========================================================================================================================
Class R Shares (note 1)
Net assets $ 2,737,366 $ 707,012 $ 1,173,053
Shares outstanding 239,271 64,313 107,923
Net asset value, offering and redemption price per share $ 11.44 $ 10.99 $ 10.87
==========================================================================================================================
</TABLE>
N/A--Intermediate and Limited Term are not authorized to issue Class B Shares.
See accompanying notes to financial statements.
36
<PAGE>
Statement of Operations
Year Ended April 30, 1999
<TABLE>
<CAPTION>
All-American Intermediate Limited Term
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Investment Income (note 1) $ 21,210,096 $ 3,014,402 $ 26,414,168
- -----------------------------------------------------------------------------------------------------------------------------------
Expenses
Management fees (note 6) 1,787,931 284,463 2,193,990
12b-1 service fees -- Class A (notes 1 and 6) 544,753 98,085 894,943
12b-1 distribution and service fees -- Class B (notes 1 and 6) 171,736 N/A N/A
12b-1 distribution and service fees -- Class C (notes 1 and 6) 538,035 53,669 314,590
Shareholders' servicing agent fees and expenses 168,313 35,608 269,164
Custodian's fees and expenses 76,817 45,230 108,976
Trustees' fees and expenses (note 6) 5,661 1,514 9,635
Professional fees 15,568 11,702 10,395
Shareholders' reports -- printing and mailing expenses 75,124 15,832 147,545
Federal and state registration fees 97,851 43,205 105,661
Other expenses 19,582 3,629 45,669
- -----------------------------------------------------------------------------------------------------------------------------------
Total expenses before expense reimbursement 3,501,371 592,937 4,100,568
Expense reimbursement (note 6) (33,793) (80,657) --
- -----------------------------------------------------------------------------------------------------------------------------------
Net expenses 3,467,578 512,280 4,100,568
- -----------------------------------------------------------------------------------------------------------------------------------
Net investment income 17,742,518 2,502,122 22,313,600
- -----------------------------------------------------------------------------------------------------------------------------------
Realized and Unrealized Gain (Loss) from Investments
Net realized gain from investment transactions (notes 1 and 4) 1,390,265 974,433 177,749
Net change in unrealized appreciation or depreciation of investments 1,381,053 (353,542) 4,044,043
- -----------------------------------------------------------------------------------------------------------------------------------
Net gain from investments 2,771,318 620,891 4,221,792
- -----------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets from operations $ 20,513,836 $ 3,123,013 $ 26,535,392
===================================================================================================================================
</TABLE>
N/A--Intermediate and Limited Term are not authorized to issue Class B Shares.
See accompanying notes to financial statements.
37
<PAGE>
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
All-American Intermediate
--------------------------- ---------------------------
Year Ended Year Ended Year Ended Year Ended
4/30/99 4/30/98 4/30/99 4/30/98
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Operations
Net investment income $ 17,742,518 $ 14,992,106 $ 2,502,122 $ 2,115,118
Net realized gain from
investment transactions (notes 1 and 4) 1,390,265 1,444,589 974,433 445,080
Net change in unrealized appreciation
or depreciation of investments 1,381,053 11,090,769 (353,542) 1,234,467
- ------------------------------------------------------------------------------------------------------------
Net increase in net assets from operations 20,513,836 27,527,464 3,123,013 3,794,665
- ------------------------------------------------------------------------------------------------------------
Distributions to Shareholders (note 1)
From undistributed net investment income:
Class A (13,558,500) (11,812,757) (2,193,035) (1,964,556)
Class B (757,569) (172,772) N/A N/A
Class C (3,203,324) (2,809,735) (282,244) (122,737)
Class R (225,133) (207,336) (32,146) (26,788)
From accumulated net realized gains
from investment transactions:
Class A (265,989) (1,796,387) (215,591) (1,421)
Class B (18,186) (34,421) N/A N/A
Class C (70,414) (476,161) (36,389) (104)
Class R (5,437) (30,203) (2,815) (19)
- ------------------------------------------------------------------------------------------------------------
Decrease in net assets
from distributions to shareholders (18,104,552) (17,339,772) (2,762,220) (2,115,625)
- ------------------------------------------------------------------------------------------------------------
Fund Share Transactions (note 2)
Net proceeds from shares issued in the
reorganization of:
Alabama 7,102,834 -- -- --
South Carolina 11,502,532 -- -- --
Florida Intermediate -- -- 12,375,612 --
Net proceeds from sale of shares 146,838,231 76,968,241 17,557,237 8,010,746
Net proceeds from shares issued to shareholders
due to reinvestment of distributions 6,230,070 9,893,852 1,227,057 1,256,923
- ------------------------------------------------------------------------------------------------------------
171,673,667 86,862,093 31,159,906 9,267,669
Cost of shares redeemed (59,511,217) (57,124,785) (15,659,540) (8,387,774)
- ------------------------------------------------------------------------------------------------------------
Net increase in net assets from
Fund share transactions 112,162,450 29,737,308 15,500,366 879,895
- ------------------------------------------------------------------------------------------------------------
Net increase in net assets 114,571,734 39,925,000 15,861,159 2,558,935
Net assets at the beginning of year 312,244,221 272,319,221 46,474,420 43,915,485
- ------------------------------------------------------------------------------------------------------------
Net assets at the end of year $426,815,955 $312,244,221 $ 62,335,579 $46,474,420
============================================================================================================
Balance of undistributed net
investment income at the end of year $ 576 $ 2,584 $ 5,292 $ 10,595
============================================================================================================
</TABLE>
<TABLE>
<CAPTION>
Limited Term
-----------------------------
Year Ended Year Ended
4/30/99 4/30/98
- ---------------------------------------------------------------------------------
<S> <C> <C>
Operations
Net investment income $ 22,313,600 $ 21,711,709
Net realized gain from
investment transactions (notes 1 and 4) 177,749 1,183,699
Net change in unrealized appreciation
or depreciation of investments 4,044,043 6,803,680
- ---------------------------------------------------------------------------------
Net increase in net assets from operations 26,535,392 29,699,088
- ---------------------------------------------------------------------------------
Distributions to Shareholders (note 1)
From undistributed net investment income:
Class A (20,627,751) (20,496,170)
Class B N/A N/A
Class C (2,406,223) (1,226,668)
Class R (45,661) (12,840)
From accumulated net realized gains
from investment transactions:
Class A -- --
Class B N/A N/A
Class C -- --
Class R -- --
- ---------------------------------------------------------------------------------
Decrease in net assets
from distributions to shareholders (23,079,635) (21,735,678)
- ---------------------------------------------------------------------------------
Fund Share Transactions (note 2)
Net proceeds from shares issued in the
reorganization of:
Alabama -- --
South Carolina -- --
Florida Intermediate -- --
Net proceeds from sale of shares 159,596,588 102,797,645
Net proceeds from shares issued to shareholders
due to reinvestment of distributions 10,739,032 13,729,912
- ---------------------------------------------------------------------------------
170,335,620 116,527,557
Cost of shares redeemed (101,189,975) (100,696,272)
- ---------------------------------------------------------------------------------
Net increase in net assets from
Fund share transactions 69,145,645 15,831,285
- ---------------------------------------------------------------------------------
Net increase in net assets 72,601,402 23,794,695
Net assets at the beginning of year 472,786,508 448,991,813
- ---------------------------------------------------------------------------------
Net assets at the end of year $ 545,387,910 $ 472,786,508
=================================================================================
Balance of undistributed net
investment income at the end of year $ 224,796 $ 990,831
=================================================================================
</TABLE>
N/A - Intermediate and Limited Term are not authorized to issue Class B Shares.
See accompanying notes to financial statements.
- ------
38
<PAGE>
Notes to Financial Statements
1. General Information and Significant Accounting Policies
The Nuveen Flagship Municipal Trust (the "Trust") is an open-end diversified
investment company registered under the Investment Company Act of 1940, as
amended. The Trust comprises the Nuveen Flagship All-American Municipal Bond
Fund ("All-American"), the Nuveen Flagship Intermediate Municipal Bond Fund
("Intermediate") and the Nuveen Flagship Limited Term Municipal Bond Fund
("Limited Term") (collectively, the "Funds"), among others. The Trust was
organized as a Massachusetts business trust on July 1, 1996.
After the close of business on September 11, 1998, Nuveen Flagship Alabama
Municipal Bond Fund ("Alabama") and Nuveen Flagship South Carolina Municipal
Bond Fund ("South Carolina") reorganized into All-American. Prior to these
reorganizations Alabama and South Carolina were each a series of the Nuveen
Flagship Multistate Trust III, an open-end investment company. Alabama and South
Carolina had fiscal year ends of May 31 prior to being reorganized into All-
American which has an April 30 fiscal year end.
After the close of business on September 11, 1998, Nuveen Flagship Florida
Intermediate Municipal Bond Fund ("Florida Intermediate") reorganized into
Intermediate. Prior to the reorganization Florida Intermediate was a series of
the Nuveen Flagship Multistate Trust I, an open-end investment company. Florida
Intermediate had a fiscal year end of May 31 prior to being reorganized into
Intermediate which has an April 30 fiscal year end.
Each Fund seeks to provide high tax-free income and preservation of capital
through investments in diversified portfolios of quality municipal bonds.
The following is a summary of significant accounting policies followed by the
Funds in the preparation of their financial statements in accordance with
generally accepted accounting principles.
Securities Valuation
The prices of municipal bonds in each Fund's investment portfolio are provided
by a pricing service approved by the Fund's Board of Trustees. When price quotes
are not readily available (which is usually the case for municipal securities),
the pricing service establishes fair market value based on yields or prices of
municipal bonds of comparable quality, type of issue, coupon, maturity and
rating, indications of value from securities dealers and general market
conditions. Temporary investments in securities that have variable rate and
demand features qualifying them as short-term securities are valued at amortized
cost, which approximates market value.
Securities Transactions
Securities transactions are recorded on a trade date basis. Realized gains and
losses from such transactions are determined on the specific identification
method. Securities purchased or sold on a when-issued or delayed delivery basis
may have extended settlement periods. Any securities so purchased are subject to
market fluctuation during this period. The Funds have instructed the custodian
to segregate assets in a separate account with a current value at least equal to
the amount of the when-issued and delayed delivery purchase commitments. At
April 30, 1999, Intermediate had an outstanding when-issued purchase commitment
of $777,070. All-American and Limited Term had no such outstanding purchase
commitments.
Investment Income
Interest income is determined on the basis of interest accrued, adjusted for
amortization of premiums and accretion of discounts on long-term debt securities
when required for federal income tax purposes.
Dividends and Distributions to Shareholders
Tax-exempt net investment income is declared as a dividend monthly and payment
is made or reinvestment is credited to shareholder accounts on the first
business day after month-end. Net realized capital gains and/or market discount
from investment transactions, if any, are distributed to shareholders not less
frequently than annually. Furthermore, capital gains are distributed only to the
extent they exceed available capital loss carryforwards.
Distributions to shareholders of tax-exempt net investment income, net realized
capital gains and/or market discount are recorded on the ex-dividend date. The
amount and timing of distributions are determined in accordance with federal
income tax regulations, which may differ from generally accepted accounting
principles. Accordingly, temporary over-distributions as a result of these
differences may occur and will be classified as either distributions in excess
of net investment income, distributions in excess of net realized gains and/or
distributions in excess of net ordinary taxable income from investment
transactions, where applicable.
39
<PAGE>
Notes to Financial Statements (continued)
Federal Income Taxes
Each Fund is a separate taxpayer for federal income tax purposes. Each Fund
intends to comply with the requirements of the Internal Revenue Code applicable
to regulated investment companies and to distribute all of its tax-exempt net
investment income, in addition to any significant amounts of net realized
capital gains and/or market discount from investment transactions. The Funds
currently consider significant net realized capital gains and/or market discount
as amounts in excess of $.001 per share. Furthermore, each Fund intends to
satisfy conditions which will enable interest from municipal securities, which
is exempt from regular federal income tax, to retain such tax-exempt status when
distributed to the shareholders of the Funds. All monthly tax-exempt dividends
paid during the fiscal year ended April 30, 1999, have been designated Exempt
Interest Dividends. Net realized capital gain and market discount distributions
are subject to federal taxation.
Flexible Sales Charge Program
Each Fund offers Class A, C and R Shares. All-American also offers Class B
Shares. Class A Shares are sold with a sales charge and incur an annual 12b-1
service fee. Class A Share purchases of $1 million or more are sold at net asset
value without an up-front sales charge but may be subject to a contingent
deferred sales charge ("CDSC") if redeemed within 18 months of purchase. Class B
Shares are sold without a sales charge but incur annual 12b-1 distribution and
service fees. An investor purchasing Class B Shares agrees to pay a CDSC of up
to 5% depending upon the length of time the shares are held by the investor
(CDSC is reduced to 0% at the end of six years). Class B Shares convert to Class
A Shares eight years after purchase. Class C Shares are sold without a sales
charge but incur annual 12b-1 distribution and service fees. An investor
purchasing Class C Shares agrees to pay a CDSC of 1% if Class C Shares are
redeemed within one year of purchase. Class R Shares are not subject to any
sales charge or 12b-1 distribution or service fees. Class R Shares are available
only under limited circumstances, or by specified classes of investors.
Derivative Financial Instruments
The Funds may invest in certain derivative financial instruments including
futures, forward, swap and option contracts, and other financial instruments
with similar characteristics. Although the Funds are authorized to invest in
such financial instruments, and may do so in the future, they did not make any
such investments during the fiscal year ended April 30, 1999.
Expense Allocation
Expenses of each Fund that are not directly attributable to a specific class of
shares are prorated among the classes based on the relative net assets of each
class. Expenses directly attributable to a class of shares, which presently only
includes 12b-1 distribution and service fees, are recorded to the specific
class.
Use of Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of increases and decreases in net
assets from operations during the reporting period. Actual results may differ
from those estimates.
40
<PAGE>
<TABLE>
<CAPTION>
2. Fund Shares
Transactions in Fund shares were as follows:
All-American
-----------------------------------------------------
Year Ended Year Ended
4/30/99 4/30/98
------------------------- ------------------------
Shares Amount Shares Amount
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares issued in the reorganization of Alabama:
Class A 395,906 $ 4,578,809 -- $ --
Class B 33,558 388,298 -- --
Class C 174,177 2,011,777 -- --
Class R 10,715 123,950 -- --
Shares issued in the reorganization of South Carolina:
Class A 888,879 10,280,233 -- --
Class B 62,148 719,099 -- --
Class C 33,844 390,899 -- --
Class R 9,709 112,301 -- --
Shares sold:
Class A 8,253,027 94,819,512 4,008,652 45,606,077
Class B 2,120,117 24,385,007 700,155 7,946,597
Class C 2,250,600 25,819,882 1,301,462 14,740,803
Class R 157,716 1,813,830 771,291 8,674,764
Shares issued to shareholders due to reinvestment of distributions:
Class A 410,709 4,717,255 660,598 7,458,579
Class B 22,987 264,311 9,097 103,693
Class C 89,793 1,029,146 188,101 2,120,043
Class R 19,091 219,358 18,643 211,537
- -------------------------------------------------------------------------------------------------------------------------------
14,932,976 171,673,667 7,657,999 86,862,093
- -------------------------------------------------------------------------------------------------------------------------------
Shares redeemed:
Class A (3,545,629) (40,755,984) (3,632,808) (40,915,436)
Class B (227,194) (2,609,789) (5,833) (66,678)
Class C (1,050,052) (12,050,245) (1,013,258) (11,466,412)
Class R (356,254) (4,095,199) (408,450) (4,676,259)
- -------------------------------------------------------------------------------------------------------------------------------
(5,179,129) (59,511,217) (5,060,349) (57,124,785)
- -------------------------------------------------------------------------------------------------------------------------------
Net increase 9,753,847 $112,162,450 2,597,650 $ 29,737,308
===============================================================================================================================
</TABLE>
- -----
41
<PAGE>
Notes to Financial Statements (continued)
<TABLE>
<CAPTION>
Intermediate
-----------------------------------------------------
Year Ended Year Ended
4/30/99 4/30/98
------------------------- -------------------------
Shares Amount Shares Amount
- --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares issued in the reorganization of Florida
Intermediate:
Class A 691,484 $ 7,709,931 -- $ --
Class C 407,786 4,549,343 -- --
Class R 10,446 116,338 -- --
Shares sold:
Class A 1,262,418 13,969,292 554,517 6,064,556
Class C 308,307 3,423,835 167,492 1,829,477
Class R 14,806 164,110 10,730 116,713
Shares issued to shareholders due to
reinvestment of distributions:
Class A 98,056 1,086,083 107,654 1,165,426
Class C 11,658 129,379 7,941 86,053
Class R 1,048 11,595 500 5,444
- --------------------------------------------------------------------------------------------------------
2,806,009 31,159,906 848,834 9,267,669
- --------------------------------------------------------------------------------------------------------
Shares redeemed:
Class A (1,238,267) (13,721,630) (678,166) (7,363,971)
Class C (157,660) (1,745,372) (93,422) (1,016,745)
Class R (17,438) (192,538) (640) (7,058)
- --------------------------------------------------------------------------------------------------------
(1,413,365) (15,659,540) (772,228) (8,387,774)
- --------------------------------------------------------------------------------------------------------
Net increase 1,392,644 $ 15,500,366 76,606 $ 879,895
========================================================================================================
Limited Term
-----------------------------------------------------
Year Ended Year Ended
4/30/99 4/30/98
------------------------- -------------------------
Shares Amount Shares Amount
- --------------------------------------------------------------------------------------------------------
Shares sold:
Class A 8,690,653 $ 94,938,574 7,703,171 $ 83,615,063
Class C 5,825,373 63,606,835 1,703,471 18,465,192
Class R 96,702 1,051,179 65,900 717,390
Shares issued to shareholders due to
reinvestment of distributions:
Class A 879,078 9,602,882 1,182,240 12,786,447
Class C 101,885 1,111,423 86,601 936,081
Class R 2,265 24,727 680 7,384
- --------------------------------------------------------------------------------------------------------
15,595,956 170,335,620 10,742,063 116,527,557
- --------------------------------------------------------------------------------------------------------
Shares redeemed:
Class A (8,242,278) (89,920,305) (8,422,781) (91,261,871)
Class C (977,837) (10,657,258) (865,221) (9,376,253)
Class R (56,064) (612,412) (5,334) (58,148)
- --------------------------------------------------------------------------------------------------------
(9,276,179) (101,189,975) (9,293,336) (100,696,272)
- --------------------------------------------------------------------------------------------------------
Net increase 6,319,777 $ 69,145,645 1,448,727 $ 15,831,285
========================================================================================================
</TABLE>
3. Distributions to Shareholders
The Funds declared dividend distributions from their tax-exempt net investment
income which were paid on June 1, 1999, to shareholders of record on May 7,
1999, as follows:
<TABLE>
<CAPTION>
All-American Intermediate Limited Term
- ----------------------------------------------------------------------------
<S> <C> <C> <C>
Dividend per share:
Class A $.0470 $.0400 $.0405
Class B .0400 N/A N/A
Class C .0420 .0350 .0375
Class R .0490 .0415 .0425
============================================================================
</TABLE>
N/A--Intermediate and Limited Term are not authorized to issue Class B Shares.
42
<PAGE>
4. Securities Transactions
Purchases and sales (including maturities) of investments in long-term municipal
securities and short-term municipal securities for the fiscal year ended April
30, 1999, were as follows:
<TABLE>
<CAPTION>
All-American Intermediate Limited Term
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Purchases:
Long-term municipal securities $123,570,575 $15,915,562 $143,340,118
Long-term municipal securities in the reorganization of Alabama 6,293,497 -- --
Long-term municipal securities in the reorganization of South Carolina 10,540,120 -- --
Long-term municipal securities in the reorganization of Florida Intermediate -- 11,285,830 --
Short-term municipal securities 73,600,000 7,300,000 101,000,000
Sales:
Long-term municipal securities 35,509,801 12,657,610 74,203,503
Short-term municipal securities 73,600,000 6,300,000 101,000,000
==================================================================================================================================
</TABLE>
At April 30, 1999, the identified cost of investments owned for federal income
tax purposes was the same as the cost for financial reporting purposes for each
Fund.
At April 30, 1999, Limited Term had an unused capital loss carryforward of
$3,801,908, available for federal income tax purposes to be applied against
future capital gains, if any. If not applied, the carryforward will expire in
the year 2003.
5. Unrealized Appreciation (Depreciation)
Gross unrealized appreciation and gross unrealized depreciation of investments
at April 30, 1999, were as follows:
<TABLE>
<CAPTION>
All-American Intermediate Limited Term
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Gross unrealized:
appreciation $26,800,543 $3,136,985 $19,945,827
depreciation (478,560) (61,524) (297,429)
- ----------------------------------------------------------------------------------------------------------------------------------
Net unrealized appreciation $26,321,983 $3,075,461 $19,648,398
==================================================================================================================================
</TABLE>
6. Management Fee and Other Transactions with Affiliates
Under the Trust's investment management agreement with Nuveen Advisory Corp.
(the "Adviser") a wholly owned subsidiary of The John Nuveen Company, each Fund
pays an annual management fee, payable monthly, at the rates set forth below
which are based upon the average daily net asset value of each Fund:
<TABLE>
<CAPTION>
All-American & Intermediate
Average Daily Net Asset Value Management Fee
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C>
For the first $125 million .5000 of 1%
For the next $125 million .4875 of 1
For the next $250 million .4750 of 1
For the next $500 million .4625 of 1
For the next $1 billion .4500 of 1
For net assets over $2 billion .4250 of 1
==================================================================================================================================
</TABLE>
<TABLE>
<CAPTION>
Limited Term
Average Daily Net Asset Value Management Fee
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C>
For the first $125 million .4500 of 1%
For the next $125 million .4375 of 1
For the next $250 million .4250 of 1
For the next $500 million .4125 of 1
For the next $1 billion .4000 of 1
For net assets over $2 billion .3750 of 1
==================================================================================================================================
</TABLE>
The management fee compensates the Adviser for overall investment advisory and
administrative services, and general office facilities. The Trust pays no
compensation directly to those of its Trustees who are affiliated with the
Adviser or to its officers, all of whom receive remuneration for their services
to the Trust from the Adviser or its affiliates.
The Adviser may voluntarily reimburse expenses from time to time, which may be
terminated at any time at its discretion.
- -----
43
<PAGE>
Notes to Financial Statements (continued)
During the fiscal year ended April 30, 1999, the Distributor collected sales
charges on purchases of Class A Shares of approximately $1,294,200, $148,400 and
$623,700 for All-American, Intermediate and Limited Term, respectively, of which
approximately $1,227,700, $123,600 and $537,900, respectively, were paid out as
concessions to authorized dealers. The Distributor also received 12b-1 service
fees on Class A Shares, substantially all of which were paid to compensate
authorized dealers for providing services to shareholders relating to their
investments.
During the fiscal year ended April 30, 1999, the Distributor compensated
authorized dealers directly with approximately $1,293,300, $88,800, and $799,100
in commission advances at the time of purchase for All-American, Intermediate
and Limited Term, respectively. To compensate for commissions advanced to
authorized dealers, all 12b-1 service fees collected on Class B Shares for All-
American during the first year following a purchase, all 12b-1 distribution fees
on Class B Shares for All-American, and all 12b-1 service and distribution fees
on Class C Shares during the first year following a purchase are retained by the
Distributor. During the fiscal year ended April 30, 1999, the Distributor
retained approximately $356,900, $30,900 and $177,100 in such 12b-1 fees for
All-American, Intermediate and Limited Term, respectively. The remaining 12b-1
fees charged to the Funds were paid to compensate authorized dealers for
providing services to shareholders relating to their investments. The
Distributor also collected and retained approximately $103,300, $800 and $72,800
of CDSC on share redemptions during the fiscal year ended April 30, 1999, for
All-American, Intermediate and Limited Term, respectively.
7. Composition of Net Assets
At April 30, 1999, each Fund had an unlimited number of $.01 par value shares
authorized. Net assets consisted of:
<TABLE>
<CAPTION>
All-American Intermediate Limited Term
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Capital paid-in $399,384,880 $58,247,509 $529,316,624
Balance of undistributed net investment income 576 5,292 224,796
Accumulated net realized gain (loss) from investment transactions 1,108,516 1,007,317 (3,801,908)
Net unrealized appreciation of investments 26,321,983 3,075,461 19,648,398
- ---------------------------------------------------------------------------------------------------------------
Net assets $426,815,955 $62,335,579 $545,387,910
===============================================================================================================
</TABLE>
8. Investment Composition
At April 30, 1999, the revenue sources by municipal purpose, expressed as a
percent of long-term securities, were as follows:
<TABLE>
<CAPTION>
All-American Intermediate Limited Term
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Education and Civic Organizations 9% 8% 13%
Energy 4 -- --
Health Care 13 20 17
Housing/Multifamily 2 3 5
Housing/Single Family 3 1 1
Long-Term Care 6 6 3
Tax Obligation/General 3 12 9
Tax Obligation/Limited 6 14 9
Transportation 13 16 7
U.S.Guaranteed 14 3 9
Utilities 20 11 22
Water and Sewer 3 3 2
Other 4 3 3
- ---------------------------------------------------------------------------------------------------------------
100% 100% 100%
===============================================================================================================
</TABLE>
Certain long-term and intermediate-term investments owned by the Funds are
either covered by insurance issued by several private insurers or are backed by
an escrow or trust containing U.S. government or U.S. government agency
securities, both of which ensure the timely payment of principal and interest in
the event of default (32% for All-American, 31% for Intermediate and 35% for
Limited Term). Such insurance or escrow, however, does not guarantee the market
value of the municipal securities or the value of any of the Funds' shares.
For additional information regarding each investment security, refer to the
Portfolio of Investments of each Fund.
44
<PAGE>
Financial Highlights
Selected data for a share outstanding throughout each period is as follows:
<TABLE>
<CAPTION>
Class (Inception Date)
Investment Operations Less Distributions
----------------------------------- -----------------------------
ALL-AMERICAN+ Net
Realized/
Unrealized
Beginning Net Invest- Net Ending
Net Invest- ment Invest- Net
Year Ended Asset ment Gain ment Capital Asset Total
April 30, Value Income (a) (Loss) Total Income Gains Total Value Return (b)
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Class A (10/88)
1999 $11.32 $.57 $ .12 $ .69 $(.57) $ (.01) $(.58) $11.43 6.23%
1998 10.90 .60 .51 1.11 (.60) (.09) (.69) 11.32 10.32
1997 (c) 10.67 .55 .29 .84 (.55) (.06) (.61) 10.90 8.02
1996 (d) 10.79 .61 (.12) .49 (.61) -- (.61) 10.67 4.64
1995 (d) 10.61 .63 .18 .81 (.63) -- (.63) 10.79 8.01
1994 (d) 11.07 .65 (.30) .35 (.65) (.16)++ (.81) 10.61 2.99
Class B (2/97)
1999 11.33 .49 .12 .61 (.49) (.01) (.50) 11.44 5.46
1998 10.91 .51 .51 1.02 (.51) (.09) (.60) 11.33 9.51
1997 (e) 10.98 .12 (.06) .06 (.13) -- (.13) 10.91 .54
Class C (6/93)
1999 11.31 .51 .12 .63 (.51) (.01) (.52) 11.42 5.69
1998 10.89 .53 .52 1.05 (.54) (.09) (.63) 11.31 9.75
1997 (c) 10.66 .50 .29 .79 (.50) (.06) (.56) 10.89 7.48
1996 (d) 10.78 .55 (.12) .43 (.55) -- (.55) 10.66 4.07
1995 (d) 10.60 .57 .18 .75 (.57) -- (.57) 10.78 7.42
1994 (f) 11.09 .57 (.32) .25 (.57) (.17)++ (.74) 10.60 2.16*
Class R (2/97)
1999 11.32 .60 .13 .73 (.60) (.01) (.61) 11.44 6.54
1998 10.91 .61 .51 1.12 (.62) (.09) (.71) 11.32 10.45
1997 (e) 10.99 .15 (.07) .08 (.16) -- (.16) 10.91 .69
==================================================================================================================================
</TABLE>
<TABLE>
<CAPTION>
Ratios/Supplemental Data
---------------------------------------------------------------------------------------
Ratio Ratio
of Net of Net
Ratio of Investment Ratio of Investment
Expenses Income Expenses Income to
to Average to Average to Average Average
Net Assets Net Assets Net Assets Net Assets
Before Before After After Portfolio
Year Ended Ending Net Reimburse- Reimburse- Reimburse- Reimburse- Turnover
April 30, Assets (000) ment ment ment (a) ment (a) Rate
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Class A (10/88)
1999 $312,238 .81% 4.97% .80% 4.98% 10%
1998 236,691 .81 5.27 .81 5.27 20
1997 (c) 216,575 .98* 5.43* .87* 5.54* 39
1996 (d) 207,992 1.02 5.41 .83 5.60 79
1995 (d) 185,495 1.06 5.72 .76 6.02 71
1994 (d) 159,867 1.05 5.34 .62 5.77 81
Class B (2/97)
1999 31,804 1.55 4.22 1.54 4.23 10
1998 8,706 1.56 4.47 1.56 4.47 20
1997 (e) 711 1.55* 4.83* 1.55* 4.83* 39
Class C (6/93)
1999 80,036 1.36 4.42 1.35 4.43 10
1998 62,336 1.36 4.72 1.36 4.72 20
1997 (c) 54,850 1.53* 4.88* 1.42* 4.99* 39
1996 (d) 47,314 1.57 4.85 1.37 5.05 79
1995 (d) 45,242 1.61 5.17 1.31 5.47 71
1994 (f) 39,997 1.63* 4.62* 1.09* 5.16* 81
Class R (2/97)
1999 2,737 .62 5.16 .61 5.17 10
1998 4,510 .61 5.42 .61 5.42 20
1997 (e) 183 .61* 5.95* .61* 5.95* 39
==================================================================================================================
</TABLE>
* Annualized.
+ Information included prior to the 11 months ended April 30, 1997, reflects
the financial highlights of Flagship All-American.
++ The amounts shown include a distribution in excess of capital gains of $.10
per share.
(a) After waiver of certain management fees or reimbursement of expenses, if
applicable, by Nuveen Advisory or its predecessor Flagship Financial.
(b) Total returns are calculated on net asset value without any sales charge and
are not annualized except where noted.
(c) For the 11 months ended April 30.
(d) For the year ended May 31.
(e) From commencement of class operations as noted through April 30.
(f) From commencement of class operations as noted through May 31.
45
<PAGE>
Financial Highlights (continued)
Selected data for a share outstanding throughout each period is
as follows:
<TABLE>
<CAPTION>
Class (Inception Date)
Investment Operations Less Distributions
-------------------------------- ----------------------------
INTERMEDIATE+
Net
Realized/
Unrealized
Beginning Net Invest- Net Ending
Net Invest- ment Invest- Net
Year Ended Asset ment Gain ment Capital Asset Total
April 30, Value Income (a) (Loss) Total Income Gains Total Value Return (b)
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Class A (9/92)
1999 $10.88 $.49 $ .17 $ .66 $(.50) $ (.04) $(.54) $11.00 6.14%
1998 10.47 .52 .41 .93 (.52) -- (.52) 10.88 8.97
1997 (c) 10.27 .47 .20 .67 (.47) -- (.47) 10.47 6.64
1996 (d) 10.29 .51 (.02) .49 (.51) -- (.51) 10.27 4.84
1995 (d) 10.16 .51 .13 .64 (.51) -- (.51) 10.29 6.63
1994 (d) 10.35 .52 (.13) .39 (.52) (.06)++ (.58) 10.16 3.72
Class C (12/95)
1999 10.89 .43 .18 .61 (.44) (.04) (.48) 11.02 5.66
1998 10.47 .46 .42 .88 (.46) -- (.46) 10.89 8.47
1997 (c) 10.28 .44 .17 .61 (.42) -- (.42) 10.47 6.00
1996 (f) 10.57 .23 (.30) (.07) (.22) -- (.22) 10.28 (1.78)*
Class R (2/97)
1999 10.86 .52 .16 .68 (.51) (.04) (.55) 10.99 6.42
1998 10.45 .54 .41 .95 (.54) -- (.54) 10.86 9.17
1997 (e) 10.60 .13 (.15) (.02) (.13) -- (.13) 10.45 (.15)
======================================================================================================================
</TABLE>
<TABLE>
<CAPTION>
Ratios/Supplemental Data
-----------------------------------------------------------------------------
Ratio Ratio
of Net of Net
Ratio of Investment Ratio of Investment
Expenses Income Expenses Income to
to Average to Average to Average Average
Net Assets Net Assets Net Assets Net Assets
Before Before After After Portfolio
Ending Net Reimburse- Reimburse- Reimburse- Reimburse- Turnover
Assets(000) ment ment ment (a) ment (a) Rate
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Class A (9/92)
1999 $51,773 .98% 4.32% .84% 4.46% 23%
1998 42,339 1.03 4.52 .79 4.76 20
1997 (c) 40,906 1.18* 4.46* .68* 4.96* 26
1996 (d) 46,742 1.17 4.31 .62 4.86 81
1995 (d) 42,069 1.24 4.45 .54 5.15 102
1994 (d) 35,891 1.29 4.04 .40 4.93 69
Class C (12/95)
1999 9,855 1.51 3.76 1.36 3.91 23
1998 3,533 1.58 3.96 1.34 4.20 20
1997 (c) 2,540 1.71* 3.90* 1.23* 4.38* 26
1996 (f) 1,187 1.73* 3.68* 1.13* 4.28* 81
Class R (2/97)
1999 707 .78 4.52 .64 4.66 23
1998 602 .83 4.71 .59 4.95 20
1997 (e) 469 .82* 4.98* .40* 5.40* 26
===============================================================================================
</TABLE>
* Annualized.
+ Information included prior to the 11 months ended April 30, 1997, reflects
the financial highlights of Flagship Intermediate.
++ The amount shown includes a distribution in excess of capital gains of $.01
per share.
(a) After waiver of certain management fees or reimbursement of expenses, if
applicable, by Nuveen Advisory or its predecessor Flagship Financial.
(b) Total returns are calculated on net asset value without any sales charge and
are not annualized except where noted.
(c) For the 11 months ended April 30.
(d) For the year ended May 31.
(e) From commencement of class operations as noted through April 30.
(f) From commencement of class operations as noted through May 31.
46
<PAGE>
Selected data for a share outstanding throughout each period is as follows:
<TABLE>
<CAPTION>
Class (Inception Date)
Investment Operations Less Distributions
----------------------------------- -------------------------------
LIMITED TERM+ Net
Realized/
Unrealized
Beginning Net Invest- Net Ending
Net Invest- ment Invest- Net
Year Ended Asset ment Gain ment Capital Asset Total
April 30, Value Income (a) (Loss) Total Income Gains Total Value Return (b)
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Class A (10/87)
1999 $10.80 $.49 $ .10 $ .59 $(.50) $ -- $(.50) $10.89 5.57%
1998 10.61 .51 .19 .70 (.51) -- (.51) 10.80 6.67
1997 (c) 10.57 .46 .04 .50 (.46) -- (.46) 10.61 4.78
1996 (d) 10.65 .51 (.09) .42 (.50) -- (.50) 10.57 4.03
1995 (d) 10.60 .51 .04 .55 (.50) -- (.50) 10.65 5.41
1994 (d) 10.74 .52 (.13) .39 (.52) (.01) (.53) 10.60 3.58
Class C (12/95)
1999 10.79 .45 .10 .55 (.47) -- (.47) 10.87 5.13
1998 10.60 .47 .19 .66 (.47) -- (.47) 10.79 6.33
1997 (c) 10.56 .44 .03 .47 (.43) -- (.43) 10.60 4.49
1996 (f) 10.76 .22 (.19) .03 (.23) -- (.23) 10.56 .46*
Class R (2/97)
1999 10.78 .51 .11 .62 (.53) -- (.53) 10.87 5.81
1998 10.59 .53 .19 .72 (.53) -- (.53) 10.78 6.87
1997 (e) 10.73 .12 (.13) (.01) (.13) -- (.13) 10.59 (.09)
==================================================================================================================================
</TABLE>
<TABLE>
<CAPTION>
Ratios/Supplemental Data
------------------------------------------------------------------------------
Ratio Ratio
of Net of Net
Ratio of Investment Ratio of Investment
Expenses Income Expenses Income to
to Average to Average to Average Average
Net Assets Net Assets Net Assets Net Assets
Before Before After After Portfolio
Ending Net Reimburse- Reimburse- Reimburse- Reimburse- Turnover
Assets (000) ment ment ment (a) ment (a) Rate
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Class A (10/87)
1999 $456,171 .77% 4.45% .77% 4.45% 16%
1998 438,134 .77 4.70 .77 4.70 30
1997 (c) 425,401 .82* 4.74* .80* 4.76* 29
1996 (d) 489,157 .84 4.72 .79 4.77 39
1995 (d) 569,196 .82 4.80 .74 4.88 20
1994 (d) 704,627 .79 4.67 .70 4.76 22
Class C (12/95)
1999 88,044 1.12 4.09 1.12 4.09 16
1998 33,952 1.12 4.35 1.12 4.35 30
1997 (c) 23,551 1.12* 4.43* 1.11* 4.44* 29
1996 (f) 15,415 1.43* 3.93* 1.19* 4.17* 39
Class R (2/97)
1999 1,173 .57 4.64 .57 4.64 16
1998 701 .59 4.86 .59 4.86 30
1997 (e) 40 .55* 5.07* .55* 5.07* 29
==================================================================================================
</TABLE>
* Annualized.
+ Information included prior to the 11 months ended April 30, 1997, reflects
the financial highlights of Flagship Limited Term.
(a) After waiver of certain management fees or reimbursement of expenses, if
applicable, by Nuveen Advisory or its predecessor Flagship Financial.
(b) Total returns are calculated on net asset value without any sales charge and
are not annualized except where noted.
(c) For the 11 months ended April 30.
(d) For the year ended May 31.
(e) From commencement of class operations as noted through April 30.
(f) From commencement of class operations as noted through May 31.
47
<PAGE>
Report of Independent Public Accountants
To the Board of Trustees and Shareholders of
Nuveen Flagship Municipal Trust:
We have audited the accompanying statements of net assets, including the
portfolios of investments, of Nuveen Flagship All-American Municipal Bond Fund,
Nuveen Flagship Intermediate Municipal Bond Fund, and Nuveen Flagship Limited
Term Municipal Bond Fund (collectively, the "Funds") (three of the portfolios
constituting the Nuveen Flagship Municipal Trust (a Massachusetts business
trust)), as of April 30, 1999, and the related statements of operations for the
year then ended, the statements of changes in net assets and the financial
highlights for the two years then ended. 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. The financial highlights for the Funds
for the years ended April 30, 1997 and prior were audited by other auditors
whose report dated June 13, 1997, expressed an unqualified opinion on those
financial highlights.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of April
30, 1999, by correspondence with the custodian and brokers. As to securities
purchased but not received, we requested confirmation from brokers and, when
replies were not received, we carried out alternative auditing procedures. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the net assets of the Nuveen
Flagship All-American Municipal Bond Fund, Nuveen Flagship Intermediate
Municipal Bond Fund, and Nuveen Flagship Limited Term Municipal Bond Fund of the
Nuveen Flagship Municipal Trust as of April 30, 1999, and the results of their
operations, the changes in their net assets, and the financial highlights for
the periods indicated above, in conformity with generally accepted accounting
principles.
ARTHUR ANDERSEN LLP
Chicago, Illinois
June 18, 1999
48
<PAGE>
Fund Information
Board of Trustees
Robert P. Bremner
Lawrence H. Brown
Anne E. Impellizzeri
Peter R. Sawers
William J. Schneider
Timothy R. Schwertfeger
Judith M. Stockdale
Fund Manager
Nuveen Advisory Corp.
333 West Wacker Drive
Chicago, IL 60606
Transfer Agent and
Shareholder Services
Chase Global Fund Services Company
P.O. Box 5186
New York, NY 10274
(800) 257-8787
Legal Counsel
Morgan, Lewis & Bockius LLP
Washington, D.C.
Independent Public Accountants
Arthur Andersen LLP
Chicago, IL
49
<PAGE>
SERVING
Investors for Generations
[PHOTO OF JOHN NUVEEN, SR. APPEARS HERE]
Since our founding in 1898, John Nuveen & Co. has been synonymous with
investments that withstand the test of time. Today we offer a broad range of
quality investments designed for individuals seeking to build and sustain
wealth. In fact, more than 1.3 million investors have trusted Nuveen to help
them pursue their financial goals.
The cornerstone of Nuveen's investment philosophy is a commitment to
disciplined long-term investment strategies whose aim is to provide consistent,
competitive performance over time -- with moderated risk. We emphasize quality
securities carefully chosen through in-depth research, and we follow those
securities closely over time to ensure that they continue to meet our exacting
standards.
Whether your focus is long-term growth, dependable income or sustaining
accumulated wealth, Nuveen offers a wide variety of investments and services to
help meet your unique circumstances and financial planning needs. Our growth,
growth and income, income, and tax-free funds, along with our defined portfolios
and private asset management, can help you build a better, well-diversified
portfolio.
Talk with your financial adviser to learn more about how Nuveen investment
products and services can help you. Or call us at (800) 257-8787 for more
information, including a prospectus where applicable. Please read that
information carefully before investing.
NUVEEN
John Nuveen & Co. Incorporated
333 West Wacker Drive
Chicago, IL 60606-1286
www.nuveen.com VAN-N2-4-99
