<PAGE>
Putnam
New York
Tax Exempt
Income Fund
[ARTWORK APPEARS HERE]
SEMIANNUAL REPORT
May 31, 1994
[LOGO OF PUTNAM APPEARS HERE]
BOSTON * LONDON * TOKYO
<PAGE>
PERFORMANCE HIGHLIGHTS
Lipper Analytical Services, an industry research firm, ranked the fund second in
10-year performance against nine other funds with similar investment objectives
as of May 31, 1994.*
CDA/Wiesenberger ranked the fund among the top 25% of municipal single-state
funds for 3, 5, and 10 years performance as of May 31, 1994.+
Performance should always be considered in light of a fund's investment
strategy. Putnam New York Tax Exempt Income Fund is designed for investors
seeking a high level of current income free from federal and New York State and
City income tax consistent with preservation of capital.
<TABLE>
<CAPTION>
FISCAL 1994 RESULTS AT A GLANCE
TOTAL RETURN: CLASS A CLASS B
SIX MONTHS ENDED 5/31/94 NAV POP NAV CDSC
<S> <C> <C> <C> <C>
(change in value during period
plus reinvested earnings) -2.48% -7.13% -2.86% -7.54%
CURRENT RETURN: NAV POP NAV
(end of period)
Current dividend rate/1/ 5.73% 5.46% 5.20%
Taxable equivalent/2/(a) 10.27 9.78 9.32
(b) 10.79 10.28 9.79
Current 30-day SEC yield/3/ 5.50 5.24 4.72
Taxable equivalent/2/(a) 9.85 9.39 8.46
(b) 10.35 9.86 8.89
<CAPTION>
SHARE VALUE: NAV POP NAV
<S> <C> <C> <C> <C>
11/30/93 $9.38 $9.85 $9.37
5/31/94 8.79 9.23 8.77
<CAPTION>
DISTRIBUTIONS: CAPITAL GAINS/4/
NUMBER INCOME SHORT-TERM LONG-TERM TOTAL
<S> <C> <C> <C> <C> <C>
Class A 7 $0.251502 $0.017 $0.098 $0.366502
Class B 7 0.226253 0.017 0.098 0.341253
</TABLE>
Performance data represent past results. For performance over longer periods,
see pages 8 and 9. POP assumes 4.75% maximum sales charge. CDSC assumes 5%
maximum contingent deferred sales charge.
/1/ Income portion of most recent distribution, divided by NAV or POP at end
of period. /2/ Assumes (a) the maximum combined state and federal tax rate
of 44.19% or (b) the maximum combined state and federal and city tax rates of
46.88%. Results for investors subject to lower tax rates would not be as
advantageous. For some investors, investment income may also be subject to
the federal Alternative Minimum Tax. /3/ Based only on investment income,
calculated using SEC guidelines. /4/ Capital gains are taxable for federal,
and in most cases, state purposes. Investment income may be subject to state
and local taxes.
*Rankings by Lipper vary over time and do not include the effects of sales
charges. The firm ranked the fund 33rd out of 68 funds for the five months
ended May 31, 1994. For one year, 31st out of 60 funds; for three years, 13th
out of 44 funds; for five years, 15th out of 34 funds. Past performance is not
indicative of future results.
+CDA/Wiesenberger rankings are updated monthly, based entirely on total
return and do not take into account sales charges or fees. The fund ranked
413th out of 574 municipal single state funds for one year, 16th of 338 funds
for three years, 51st out of 230 funds for five years, and second out of 27
funds for ten years as of May 31, 1994.
2
<PAGE>
FROM THE CHAIRMAN
[PHOTO OF GEORGE PUTNAM APPEARS HERE]
(c) KARSH, OTTAWA
DEAR SHAREHOLDER:
THE FEDERAL RESERVE BOARD'S PRIMARY CONCERN REMAINS FIGHTING NOT ONLY
INFLATION BUT THE FEAR OF INFLATION. IT IS ADDRESSING THIS ISSUE BY GRADUALLY
RAISING THE SHORT-TERM INTEREST RATES UNDER ITS CONTROL TO SLOW THE ECONOMY'S
GROWTH TO WHAT IT REGARDS AS A SUSTAINABLE PACE.
THE COMBINATION OF THE FED'S CONTINUING POLICY AND THE RESPONSE BY
INDIVIDUALS AND BUSINESSES TO LAST YEAR'S TAX INCREASE COULD PRODUCE MORE OF
A SLOWDOWN IN BUSINESS THAN MANY OBSERVERS NOW EXPECT.
AS THIS SLOWING BECOMES MORE OBVIOUS, THE FED WILL COME UNDER GROWING
PRESSURE FROM POLITICIANS TO EASE UP. THE FED IS NOT LIKELY TO YIELD. BUT THE
VERY FACT THAT INVESTORS THINK IT MIGHT COULD CAUSE SOME MORE VOLATILITY IN
THE BOND MARKETS IN THE MONTHS AHEAD.
MEANWHILE, YOU CAN TAKE COMFORT IN THE TAX SHELTER PROVIDED FOR THE INCOME
GENERATED BY YOUR PUTNAM TAX-EXEMPT FUND SHARES.
IN THE FOLLOWING REPORT, FUND MANAGER DAVID EURKUS EXPLAINS HOW HE IS
POSITIONING YOUR FUND'S PORTFOLIO TO RESPOND TO 1994'S UNFOLDING EVENTS.
RESPECTFULLY YOURS,
GEORGE PUTNAM
CHAIRMAN OF THE TRUSTEES
JULY 20, 1994
3
<PAGE>
REPORT FROM THE FUND MANAGER
DAVID J. EURKUS
Although Putnam New York Tax Exempt Income Fund began fiscal 1994 on a high
note, this Spring's market correction meant a distinct change of tune. A
series of increases in short-term interest rates precipitated a substantial
bond market decline, and your fund -- along with its peers -- could not
escape the dampening effects.
Over the short term, your fund's performance was somewhat disappointing.
However, we believe the current market environment offers excellent potential
for stronger long-term performance for two reasons. The first is the
potential for a more favorable supply/demand situation. The second reason is
the presence of undervalued securities due to the municipal bond market's
recent overreaction and resulting sell-off in response to a series of
short-term interest rate increases. In addition, we are taking advantage of
our extensive in-house research capabilities in order to identify growing
sectors within the New York market that can offer future opportunities for
the fund.
SOUND STRATEGY, STRONG MARKET
In order to keep the events of the last six months in perspective, it
should be noted that the Fed's initial increase (as well as subsequent
increases) in interest rates had a negative effect on all fixed-income market
sectors. While there was some cause for concern that the cost of borrowing
would increase, we believe the steep drop in bond prices was due more to
investors' overreactions than to hard economic data.
4
<PAGE>
Although your fund experienced few redemptions, many no-load fund
shareholders opted to redeem their fund's shares. Fund managers were forced
to meet liquidation requests by selling portfolio holdings, with the effect
of further lowering prices.
For long-term investors, the recent decline may yet reveal a silver lining.
Late last year, we predicted a significant decrease in supply in the
municipal bond market and in New York in particular. As you may know, that
prediction came to pass this year with new issuances falling by more than
40%. We believe this occurrence, coupled with an increase in demand because
of higher taxes and the attractiveness of municipal bonds relative to taxable
Treasury bonds, will continue to act as a strong price support.
In addition, following the market drop, a significant increase occurred in
the number of undervalued securities available. The securities, many of which
are of the highest quality, offer growth potential for the fund.
[LINE GRAPH APPEARS HERE]
Municipal Bond Prices
5/31/93 - 5/31/94
Plot Points
Lehman Bros.
date/year Muni Bond Index
5/31/93 108.15
6/30/93 109.07
7/31/93 105.93
8/31/93 107.34
9/30/93 107.7
10/31/93 107.18
11/30/93 105.41
12/31/93 106.86
1/31/94 107.37
2/28/94 103.87
3/31/94 98.94
4/31/94 99.25
5/31/94 99.58
5
<PAGE>
NEW YORK: A MARKET ON THE UPSWING
Several state-specific reasons not only point to a more encouraging
environment for New York municipal bonds, but also lead us to believe the
state's debt will receive an upgrade by the end of the year.
Primarily, we believe the improved state economy and a recent budget surplus
of over $1 billion will eventually contribute to credit upgrades for these
issues that suffered when the state's credit was downgraded earlier this
decade. While the current political wrangling over the budget in the
legislature may delay any potential upgrade over the near term, we remain
bullish about the state's long-term prospects.
Secondly, we believe there will continue to be a strong municipal bond market
in New York because of the substantial numbers of the state's bonds scheduled
to mature over the next few years. The 1980s saw rapid growth in the issuance
of municipal debt. We see these bonds maturing or being called through 1998,
thus propping up demand. In addition, we believe the supply situation
outlined above will continue through that time as well.
Lastly, the fund has employed superior research techniques to diversify the
portfolio among an array of issues. While the fund does not concentrate on
any one particular sector, it has spread its holdings over a wide variety of
investment-grade issues such as the Port Authority of New York and New
Jersey, the state university system, and issues from major airports such as
New York City's Kennedy Airport and Buffalo Airport.
6
<PAGE>
[BAR CHART APPEARS HERE]
Top Five Industry Sectors*
Healthcare 19.89%
Education 19.17%
Transportation 15.49%
Housing 8.01%
Pollution Control 7.65%
* Based on net assets on 5/31/94
LOOKING AHEAD
In the near future we see an economy of slow but steady growth with
relatively low interest rates and inflation. We also believe municipal bonds
will look attractive compared with Treasuries and some taxable investments,
especially since municipal bond yields are relatively high and taxes remain
on the increase.
Looking farther down the road, we believe that the municipal securities we
stockpiled prior to the correction still have the potential to appreciate in
value and that our research-intensive strategy can help us identify the most
promising opportunities available in the months ahead.
7
<PAGE>
PERFORMANCE SUMMARY
This section provides, at a glance, information about your fund's
performance. Total return shows how the value of the fund's shares changed
over time, assuming you held the shares through the entire period and
reinvested all distributions back into the fund. We show total return in two
ways: on a cumulative long-term basis (see the chart on the facing page) and
how the fund might have grown each year, on average, over varying periods
(see the tables below). For comparative purposes, we show how the fund
performed relative to appropriate indexes and benchmarks.
TOTAL RETURN FOR PERIODS ENDING 5/31/94
<TABLE>
<CAPTION>
Lehman Bros.
Class A Class B Municipal
NAV POP NAV CDSC Bond Index CPI
================================================================================================
<S> <C> <C> <C> <C> <C> <C>
6 months -2.48% -7.13% -2.86% -7.54% -1.83% 1.17%
- ------------------------------------------------------------------------------------------------
1 year 1.08 -3.68 0.38 -4.34 2.47 2.29
- ------------------------------------------------------------------------------------------------
5 years 46.37 39.42 -- 48.84 19.14
Annual average 7.92 6.87 -- 8.28 3.57
- ------------------------------------------------------------------------------------------------
10 years 179.84 166.51 -- 186.42 42.65
Annual average 10.84 10.30 -- 11.10 3.62
- ------------------------------------------------------------------------------------------------
Life of class B
(since 1/4/93)(b) -- -- 6.13 2.21 7.95 3.95
- ------------------------------------------------------------------------------------------------
Annual average -- -- 4.31 1.56 5.53 2.76
================================================================================================
</TABLE>
TOTAL RETURN FOR PERIODS ENDING 6/30/94
(most recent calendar quarter)
<TABLE>
<CAPTION>
Class A Class B
NAV POP NAV CDSC
================================================================================================
<S> <C> <C> <C> <C>
1 year -1.23% -5.93% -1.91% -6.52%
- ------------------------------------------------------------------------------------------------
5 years 43.34 36.60 -- --
Annual average 7.47 6.44 -- --
- ------------------------------------------------------------------------------------------------
10 years 171.07 158.35 -- --
Annual average 10.49 9.96 -- --
- ------------------------------------------------------------------------------------------------
Life of class B
(since 1/4/93) -- -- 5.35 1.48
Annual Average -- -- 3.56 0.99
================================================================================================
</TABLE>
Performance data represent past results. Investment returns and net asset
value will fluctuate so an investor's shares, when sold, may be worth more or
less than their original cost. Fund performance data do not take into account
any adjustment for taxes payable on reinvested distributions or, for class A
shares, distribution fees prior to implementation of the class A distribution
plan in 1990.
8
<PAGE>
TERMS AND DEFINITIONS
CLASS A FUND SHARES may be subject to an initial sales charge.
CLASS B FUND SHARES may be subject to a sales charge on redemption.
NET ASSET VALUE (NAV) is the value of all fund assets, minus liabilities,
divided by the number of outstanding shares. It does not include any initial
or contingent deferred sales charges.
PUBLIC OFFERING PRICE (POP) is the price of a fund share plus the maximum
sales charge levied at the time of purchase. POP performance figures shown
here assume the maximum 4.75% sales charge.
CONTINGENT DEFERRED SALES CHARGE (CDSC) is applied on redemption of fund
shares. Your fund's CDSC declines from a 5% maximum during the first year to
1% during the sixth year. After the sixth year, the CDSC no longer applies.
COMPARATIVE BENCHMARKS
LEHMAN BROTHERS MUNICIPAL BOND INDEX is an unmanaged list of long-
term fixed-rate investment-grade tax-exempt bonds representative of the
municipal bond market. The index does not take into account brokerage
commissions or other costs, may include bonds different from those in the
fund, and may pose different risks than the fund.
CONSUMER PRICE INDEX is a commonly used measure of inflation. It does not
represent an investment return.
9
<PAGE>
THE PUTNAM FUND SELECTOR(TM)
The Putnam Fund Selector(TM) shows the many opportunities for investors
within every investment strategy. All investors should first accumulate a
base of conservative, cash-equivalent investments. Then, with the help of
your investment advisor, diversify your portfolio by investing in the Putnam
Family of Funds.
PUTNAM GROWTH FUNDS
RISK/REWARD
PUTNAM GROWTH
AND INCOME FUNDS
PUTNAM INCOME OR TAX-FREE INCOME FUNDS
MOST CONSERVATIVE INVESTMENTS
10
<PAGE>
PUTNAM GROWTH FUNDS
Asia Pacific Growth Fund
Diversified Equity Trust
Europe Growth Fund
Global Growth Fund
Health Sciences Trust
Investors Fund
Natural Resources Fund
New Opportunities Fund
OTC Emerging Growth Fund
Overseas Growth Fund
Vista Fund
Voyager Fund
PUTNAM GROWTH
AND INCOME FUNDS
Convertible Income-Growth Trust
Dividend Growth Fund
Equity Income Fund
The George Putnam Fund of Boston
The Putnam Fund for Growth and Income
Managed Income Trust
Utilities Growth and Income Fund
PUTNAM INCOME FUNDS
Adjustable Rate U.S. Government Fund
American Government Income Fund
Balanced Government Fund
Corporate Asset Trust
Diversified Income Trust
Federal Income Trust
Global Governmental Income Trust
High Yield Advantage Fund
High Yield Trust
Income Fund
U.S. Government Income Trust
PUTNAM TAX-FREE
INCOME FUNDS
Intermediate Tax Exempt Fund
Municipal Income Fund
Tax Exempt Income Fund
Tax-Free High Yield Fund
Tax-Free Insured Fund
State tax-free income funds*
Arizona, California, Florida, Massachusetts, Michigan, Minnesota, New Jersey,
New York, Ohio, and Pennsylvania
LIFESTAGE(TM) FUNDS
Putnam Asset Allocation Funds -- three investment portfolios that spread your
money across a variety of stocks, bonds, and money market investments to help
maximize your return and reduce your risk.
The three portfolios:
Putnam Asset Allocation: Balanced Portfolio
Putnam Asset Allocation: Conservative Portfolio
Putnam Asset Allocation: Growth Portfolio
MOST CONSERVATIVE INVESTMENTS+
Putnam money market funds
Daily Dividend Trust
Tax Exempt Money Market Fund
CDs and savings accounts++
* Not available in all states.
+ Relative to above.
++Not offered by Putnam Investments. Certificates of deposit offer a fixed
rate of return and may be insured, up to certain limits, by federal/state
agencies. Savings accounts may also be insured up to certain limits.
Please call your financial advisor or Putnam to obtain a prospectus for any
Putnam fund. It contains more complete information, including charges and
expenses. Read it carefully before you invest or send money.
11
<PAGE>
PORTFOLIO OF INVESTMENTS OWNED
May 31, 1994 (Unaudited)
<TABLE>
<CAPTION>
MUNICIPAL BONDS AND NOTES (98.7) (a)
PRINCIPAL AMOUNT RATINGS (b) VALUE
NEW YORK(93.1%)
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
34th Street Partnership Inc. Rev. Bonds (34th Street Business Impt.)
$ 5,300,000 5 1/2s, 1/1/23 A $ 4,809,750
2,000,000 5 1/2s, 1/1/14 A 1,855,000
Albany, Indl. Dev. Agcy. Rev. Bonds (Mental Hlth. & Retardation Ctr.)
1,215,000 Ser. B, 7.9s, 6/1/07 A 1,322,830
1,010,000 Ser. A, 7.9s, 12/1/06 A 1,099,637
5,000,000 Albany, Parking Auth. Rev. Bonds
(Green & Hudson St. Garage), Ser. A, 7.15s, 9/15/16 A 5,181,250
3,000,000 Babylon, Indl. Dev. Agcy. Resource Recvy. Rev. Bonds
(Ogden Martin Syst.), Ser. B, 8 1/2s, 1/1/19 Baa 3,303,750
Battery Park, City Auth. Rev. Bonds
14,500,000 7.7s, 5/1/15 AAA 16,403,124
350,000 Ser. A, 5.7s, 11/1/20 AA 323,749
29,125,000 Ser. A, 5 1/4s, 11/1/17 AA 25,375,155
20,645,000 Ser. A, 5s, 11/1/13 AA 17,857,924
5,705,000 Ser. A, 5s, 11/1/08 AA 5,148,762
21,160,000 Ser. A, 4 3/4s, 11/1/19 AA 17,113,149
Erie Cnty., General Obligation (G.O.) Bonds
1,700,000 Ser. B, 9 1/2s, 12/15/00 BBB 1,880,624
1,000,000 Ser. A, 9 1/2s, 2/1/00 BBB 1,067,500
1,700,000 Ser. B, 9 1/2s, 12/15/99 BBB 1,880,624
1,600,000 Ser. A, 9 1/2s, 2/1/99 BBB 1,708,000
2,000,000 Ser. A, 9.4s, 2/1/98 BBB 2,132,500
2,800,000 Ser. A, 9.3s, 2/1/97 BBB 2,985,500
Greece, Central School Dist. Rev. Bonds
950,000 Financial Guaranty Insurance Corp.(FGIC), 6s, 6/15/15 AAA 957,124
950,000 6s, 6/15/14 AAA 961,874
950,000 6s, 6/15/13 AAA 961,874
950,000 6s, 6/15/12 AAA 961,874
950,000 6s, 6/15/11 AAA 966,624
950,000 6s, 6/15/10 AAA 970,187
5,000 Ithaca, Hsg. Corp. Mtge. Rev. Bonds
(Eddygate Park Apts. Project), 9s, 6/1/06 BBB/P 5,050
Jamesville-Dewit Central School Dist. Rev. Bonds,
American Municipal Bond Assurance Corp. (AMBAC)
675,000 5 3/4s, 6/15/10 AAA 669,094
675,000 5 3/4s, 6/15/09 AAA 672,469
5,000,000 Metro Trans. Auth. Residual Interest Bonds (RIBS)
Ser 1993B, AMBAC, 6.859s, 6/30/02 (acquired 6/30/93,
cost $5,158,013) (c) AAA 4,606,250
Metro. Trans. Auth. Svcs. Contract Fac. Rev. Bonds
3,290,000 (Trans. Fac.), Ser. 3, 7 1/2s, 7/1/16 Aaa 3,762,938
3,750,000 (Trans. Fac.), Ser. 3, 7 3/8s, 7/1/08 Baa 4,125,000
3,000,000 (Trans. Fac.), 7 1/8s, 7/1/15 Aaa 3,397,500
12,585,000 (Trans. Fac.), Ser. 5, 7s, 7/1/12 Baa 13,009,744
3,000,000 (Trans. Fac.), 7s, 7/1/09 Baa 3,112,500
12,600,000 (Commuter Fac.), Ser. P, 5 3/4s, 7/1/15 Baa 11,592,000
14,865,000 (Trans. Fac.), Ser. P, 5 3/4s, 7/1/15 Baa 13,675,800
1,995,000 (Trans. Fac.), Ser. O, 5 3/4s, 7/1/13 Baa 1,862,831
4,225,000 (Trans. Fac.), Ser. O, 5 3/4s, 7/1/08 Baa 4,034,875
10,400,000 (Trans. Fac.), Ser. 7, 5 5/8s, 7/1/16 Baa 9,399,000
8,000,000 (Commuter Fac.), Ser. O, 5 1/2s, 7/1/17 Baa 7,180,000
17,490,000 (Trans. Fac), Ser. O, 5 1/2s, 7/1/17 Baa 15,697,275
</TABLE>
12
<PAGE>
<TABLE>
<CAPTION>
MUNICIPAL BONDS AND NOTES
PRINCIPAL AMOUNT RATINGS (b) VALUE
NEW YORK(continued)
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
$ 1,575,000 (Commuter Fac.), Ser. 7 4 3/4s, 7/1/19 Baa $ 1,244,250
3,500,000 (Trans. Fac.), Ser. 7, 4 3/4s, 7/1/19 Baa 2,765,000
12,000,000 Metro. Trans. Auth. Transit Fac. Rev. Bonds,
Municipal Bond Insurance Assn. (MBIA), Ser. K, 6 1/4s,
7/1/11 AAA 12,390,000
Metro. Trans. Auth. Transit Fac. Rev. Bonds
5,000,000 Ser. K, 6.1s, 7/1/03 Baa 5,087,500
4,500,000 Ser. M, 6s, 7/1/14 Baa 4,246,875
9,500,000 Ser. M, MBIA, 6s, 7/1/14 AAA 9,476,250
1,305,000 Monroe Cnty., Rochester Pure Wtr. Dist. G.O. Bonds
8.4s, 6/1/01 AA 1,427,344
2,400,000 Monroe Cnty., Wtr. Auth. Rev. Bonds, 6 1/4s, 8/1/11 AA 2,490,000
Muni. Assistance Corp. for the City of NY Rev. Bonds
4,500,000 Ser. 61, 5 3/4s, 7/1/08 AA 4,556,250
11,795,000 Ser. 62, 5 1/2s, 7/1/08 AA 11,809,744
NY City, G.O. Bonds
11,200,000 Ser. D, Group B, 8 1/4s, 8/1/11 A 12,824,000
2,775,000 Ser. B, 8 1/4s, 6/1/07 A 3,222,469
12,325,000 Ser. B, 8 1/4s, 6/1/05 A 14,374,031
205,000 Ser. A, 8s, 8/15/19 A 231,650
20,195,000 Ser. A, 8s, 8/15/19 A 23,779,613
1,000,000 Ser. D, Group A, 8s, 8/1/07 A 1,140,000
10,000,000 Ser. D, Group A, 8s, 8/1/03 A 11,250,000
5,575,000 Ser. D, 7.65s, 2/1/08 A 6,167,344
3,455,000 Ser. E, 7.6s, 2/1/05 A 3,822,094
4,730,000 Ser. F, 7.6s, 2/1/05 A 5,232,563
27,000,000 Ser. B, 7 1/2s, 2/1/06 A 29,700,000
20,000,000 Ser. B, 7 1/2s, 2/1/02 A 21,750,000
8,300,000 Ser. B, 7s, 10/1/13 A 8,932,875
18,800,000 Ser. F, 3s, 11/15/00 A 16,097,500
5,000,000 Ser. F, MBIA, 3s, 11/15/00 AAA 4,418,750
NY City, Hlth. & Hosp. Auth. Local Govt. Rev. Bonds
2,750,000 Ser. A, 6s, 2/15/07 Baa 2,695,000
2,610,000 Ser. A, 6s, 2/15/05 Baa 2,577,375
NY City, Hsg. Dev. Corp. Mtge. Variable Rate Demand
Notes (VRDN)
1,000,000 (Upper Fifth Ave. Project), Ser. A, 2.6s, 1/1/16 VMIG1 1,000,000
3,300,000 (East 96th St. Project), Ser. A, 2.6s, 8/1/15 VMIG 3,300,000
575,000 (Parkgate Tower Project), 2 1/2s, 12/1/07 VMIG1 575,000
25,300,000 NY City, Hsg. Dev. Corp. Mtge. Multi-Fam. Rev. Bonds,
Ser. B, Federal Housing Authority (FHA) Insd. 5.85s,
5/1/26 AA 23,402,500
1,000,000 NY City, Indl. Dev. Agcy. Civic Fac. Rev. Bonds, Ser
1990, 7 5/8s, 7/1/10 AAA/P 1,058,750
13,000,000 NY City, Muni. Wtr. Fin. Auth. RIBS, 11.169s, 6/15/11
(acquired 8/9/91; cost $13,587,860) (c) AAA 17,225,000
NY City, Muni. Wtr. Fin. Auth. Wtr. & Swr. Syst. Rev.
Bonds
2,000,000 Ser. A, 7s, 6/15/14 AAA 2,137,500
5,000,000 Ser. A, 6 3/4s, 6/15/17 A 5,131,250
1,700,000 Ser. A, FGIC, 6 3/4s, 6/15/16 AAA 1,802,000
4,000,000 Ser. A, 6s, 6/15/17 AAA 3,920,000
8,150,000 Ser. A, 6s, 6/15/17 A 7,824,000
</TABLE>
13
<PAGE>
<TABLE>
<CAPTION>
MUNICIPAL BONDS AND NOTES
PRINCIPAL AMOUNT RATINGS (b) VALUE
NEW YORK(continued)
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
$ 9,085,000 Ser. A, 6s, 6/15/08 A $ 9,130,425
1,250,000 Ser. A, 5 1/2s, 6/15/11 AAA 1,189,063
2,000,000 Ser. A, MBIA, zero%, 6/15/03 AAA 1,252,500
8,835,000 Ser. A, MBIA, zero%, 6/15/02 AAA 5,875,275
19,000,000 NY City, Muni. Fin. Auth. Wtr. & Swr. Syst.
VRDN FGIC, Ser. G, 2.95s, 6/15/24 VMIG1 19,000,000
NY State Crossover G.O. Bonds
2,750,000 6 1/8s, 11/15/14 A 2,743,125
2,455,000 6.1s, 11/15/09 A 2,473,413
2,305,000 6.1s, 11/15/08 A 2,342,456
13,000,000 NY State Dorm. Auth. RIBS
(Cornell U.) 10.919s, 7/1/30 (acquired 8/9/91
cost $13,315,900) (c) AA 15,437,500
NY State Dorm. Auth. Rev. Bonds
1,250,000 (The Society of NY Hosp.), 9 3/4s, 7/1/15 Baa 1,279,688
5,000,000 (NY Dept of Ed.), 7 3/4s, 7/1/21 Baa 5,637,500
10,000,000 (City U. Syst.), 7 5/8s, 7/1/14 Baa 10,825,000
9,000,000 (State U. Edl. Fac.), Ser. A, 7 5/8s, 5/15/05 Baa 10,305,000
10,500,000 (State U. Edl. Fac.), Ser. B, 7 1/2s, 5/15/11 Baa 11,865,000
18,800,000 (City U. Syst.), Ser. C, 7 1/2s, 7/1/10 Baa 21,103,000
500,000 (Wildwood School), 7.3s, 7/1/15 A 545,000
4,000,000 (State U. Athletic Fac.), 7 1/4s, 7/1/21 Baa 4,305,000
1,995,000 (State U. Edl. Fac.), Ser. A, 7 1/4s, 5/15/18 Baa 2,276,794
260,000 (State U. Edl. Fac.), Ser. A, 7 1/4s, 5/15/18 Baa 296,725
7,250,000 (City U. Syst.), Ser. A, 6 1/2s, 7/1/16 Baa 7,259,063
26,605,000 (City U. Syst.), Ser. A, 6 1/2s, 7/1/15 Baa 26,638,256
1,650,000 (City U. Syst.), Ser. A, 6 1/2s, 7/1/14 Baa 1,652,063
4,465,000 (U. of Rochester), 6 1/2s, 7/1/09 A 4,638,019
1,685,000 (State U. Edl. Fac.), Ser. A, 6.2s, 5/15/06 Baa 1,708,169
16,750,000 (State U. Edl. Fac.), Ser. A, 6s, 5/15/22 Baa 15,912,500
22,200,000 (Construction City U. Syst.), Ser. A, 6s, 7/1/20 (d) Baa 21,228,750
2,970,000 (State U. Edl. Fac.), Ser. B, 6s, 5/15/17 Baa 2,843,775
7,390,000 (State U. Edl. Fac.), Ser. A, 5 7/8s, 5/15/17 Baa 7,011,263
2,410,000 (State U. Edl. Fac.), Ser. A, 5 7/8s, 5/15/11 Baa 2,316,613
21,475,000 (Construction City U. Syst.) 5 3/4s, 7/1/18 Baa 19,783,844
1,000,000 (Columbia U.), 5 3/4s, 7/1/15 Aaa 978,750
10,000,000 (U. of Rochester) 5 3/4s, 7/1/14 A 9,362,500
15,000,000 (Construction City U. Syst.), Ser. A, 5 3/4s, 7/1/13 Baa 14,025,000
11,615,000 (Upstate Cmnty. Colleges) , Ser. A, 5.7s, 7/1/21 Baa 10,584,169
1,250,000 (Colgate U.) FGIC, 5 5/8s, 7/1/23 AAA 1,192,188
4,000,000 (Upstate Cmnty. Colleges), Ser. A, 5 5/8s, 7/1/14 Baa 3,700,000
10,625,000 (City U. Syst.), 5 1/2s, 7/1/21 A 9,389,844
14,200,000 (State U. Edl. Fac.), Ser. A, 5 1/2s, 5/15/13 Baa 12,975,250
31,505,000 (State U. Edl. Fac.), Ser. B, 5 1/4s, 5/15/19 Baa 26,936,775
13,250,000 (State U. Edl. Fac.), Ser. A, 5 1/4s, 5/15/15 Baa 11,560,625
3,500,000 (State U. Edl. Fac.), Ser. B, 5 1/4s, 5/15/13 Baa 3,066,875
17,025,000 (Mt. Sinai Medical School), Ser. A, MBIA, 5s, 7/1/21 AAA 14,492,531
6,500,000 (City U.), Ser. F, 5s, 7/1/20 Baa 5,224,375
27,990,000 (State U. Edl. Fac.), Ser. B, 5s, 5/15/18 Baa 23,056,763
10,000,000 (City U. Syst.), Ser. C, 5s, 7/1/17 Baa 8,162,500
4,020,000 (Columbia U.), 5s, 7/1/15 Aaa 3,507,450
15,985,000 (Cornell U.), 5s, 7/1/15 AA 14,306,575
23,864,000 (State U. Edl. Fac.), Ser. B, zero%, 5/15/10 Baa 8,620,870
</TABLE>
14
<PAGE>
<TABLE>
<CAPTION>
MUNICIPAL BONDS AND NOTES
PRINCIPAL AMOUNT RATINGS (b) VALUE
NEW YORK(continued)
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
$ 48,000,000 (State U. Edl. Fac.), Ser. B, zero%, 5/15/09 Baa $ 18,660,000
54,520,000 (State U. Edl. Fac.), Ser. B, zero%, 5/15/08 Baa 22,898,400
10,000,000 (State U. Edl. Fac.), Ser. B, zero%, 5/15/07 Baa 4,550,000
10,580,000 (State U. Edl. Fac.), Ser. B, zero%, 5/15/06 Baa 5,184,200
12,155,000 (U. of Rochester Strong Memorial Hosp. Project), 5.9s,
7/1/17 A 11,440,894
5,000,000 NY State Energy Research & Dev. Auth. Elec. Fac.
Rev. Bonds
(Con. Edison Co. of NY, Inc. Project), 9s, 8/15/20 A 5,331,250
NY State Energy Research & Dev. Auth. Gas. Fac.
Rev. Bonds (Brooklyn Union Gas Co. Project)
8,100,000 Ser. A, 9s, 5/15/15 A 8,586,000
8,000,000 Ser. 1, 7 1/8s, 12/1/20 A 8,460,000
10,000,000 NY State Energy Research & Dev. Auth. Gas Fac.
RIBS (Brooklyn Union Gas Co.), Ser. B, 11.034s, 7/1/26 A 10,850,000
NY State Energy Research & Dev. Auth. Poll. Control
Rev. Bonds (Orange and Rockland Util. Project)
5,000,000 10 1/4s, 10/1/14 A 5,193,750
5,000,000 9s, 8/1/15 A 5,337,500
NY State Env. Fac. Corp. Poll. Control Rev. Bonds
8,655,000 (State Wtr. Revolving Fund), Ser A, 7 1/2s, 6/15/12 Aa 9,704,419
3,780,000 (IBM Corp. Project) 7 1/8s, 7/1/12 A 4,087,125
4,480,000 (State Wtr. Revolving Fund), Ser. E, 6 7/8s, 6/15/10 Aa 4,732,000
6,870,000 (State Wtr. Revolving Fund), Ser. B, 6.65s, 9/15/13 AA 7,101,863
5,265,000 (State Wtr. Revolving Fund), Ser. A, 6.55s, 9/15/10 AA 5,442,694
10,500,000 (State Wtr. Revolving Fund), Ser. E, 6 1/2s, 6/15/14 Aa 10,775,625
6,500,000 (State Wtr. Revolving Fund), 5 3/4s, 6/15/12 Aa 6,353,750
1,000,000 (State Wtr. Revolving Fund), Ser. B, 5.2s, 5/15/14 AA 891,250
2,670,000 (State Wtr. Revolving Fund), Ser. B, 5.1s, 5/15/10 AA 2,419,688
2,780,000 NY State G.O. Bonds 5.2s, 3/15/10 A 2,554,125
NY State Hsg. Corp. Rev Bonds
1,225,000 5 1/2s, 11/1/20 AA 1,097,906
5,300,000 5s, 11/1/18 AA 4,438,750
13,135,000 5s, 11/1/13 AA 11,361,775
16,750,000 Ser. A, zero %, 11/1/10 A 9,254,374
NY State Hsg. Fin. Agcy. Rev. Bonds
28,000,000 Ser. A, 8s, 11/1/08 Baa 31,850,000
9,440,000 (Multi-Fam. Hsg. Insd. Mtge.), Ser. A, 7s, 8/15/22 AA 9,758,600
1,050,000 (Multi-Fam. Mtge. Hsg. Insd. Mtge.), Ser. A,
6.95s, 8/15/12 AA 1,089,375
3,250,000 (Multi-Fam. Hsg. Secd. Mtge.), Ser. PG-E, 6 3/4s, 8/15/25 AA 3,298,750
2,750,000 (Multi-Fam. Mtge. Hsg.), Ser. C, FHA Insd., 6 1/2s, 8/15/24 AAA 2,736,250
1,000,000 (Multi-Fam. Mtge. Hsg.), Ser. C, FHA Insd., 6.45s, 8/15/14 AAA 1,000,000
1,455,000 (Multi-Fam. Hsg. Secd. Mtge.), Ser. D,
6.2s, 8/15/12 Aa 1,447,725
NY State Hsg. Fin. Agcy. Svcs. Contract Oblig. Rev. Bonds
9,000,000 Ser. A, 7.8s, 9/15/20 AAA 10,507,500
7,500,000 Ser. C, 7.3s, 3/15/21 AAA 8,596,875
1,000,000 Ser. C, 7.3s, 9/15/12 Baa 1,073,750
1,500,000 Ser. A, 7 1/4s, 9/15/12 Baa 1,610,625
16,335,000 Ser. C, 5 7/8s, 9/15/14 Baa 15,252,806
14,000,000 Ser. A, 5 1/2s, 9/15/22 Baa 12,180,000
15,500,000 Ser. D, 5 3/8s, 3/15/23 Baa 13,233,125
NY State Local Govt. Asst. Corp. Rev. Bonds
</TABLE>
15
<PAGE>
<TABLE>
<CAPTION>
MUNICIPAL BONDS AND NOTES
PRINCIPAL AMOUNT RATINGS (b) VALUE
NEW YORK(continued)
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
$ 5,000,000 Ser. A, 7 1/4s, 4/1/18 AAA $ 5,681,250
11,750,000 Ser. A, 6 7/8s, 4/1/19 A 12,249,375
6,100,000 Ser. D, 6 3/4s, 4/1/21 Aaa 6,778,625
21,205,000 Ser. A, 6 1/2s, 4/1/20 A 21,417,050
5,885,000 Ser. C, 6 1/4s, 4/1/18 A 5,855,575
7,000,000 Ser. C, 5 1/2s, 4/1/17 A 6,335,000
4,500,000 Ser. E, 5 1/4s, 4/1/16 A 3,948,750
3,900,000 Ser. D, 5s, 4/1/23 A 3,212,625
10,000,000 Ser. C, 5s, 4/1/21 A 8,287,500
26,100,000 Ser. E, 5s, 4/1/21 A 21,760,875
2,500,000 NY State Local Govt. Asst. Corp. VRDN, 2 1/2s, 4/1/23 VMIG1 2,500,000
24,700,000 NY State Med. Care Fac. Fin. Agcy. RIBS (Montefiore
Med. Ctr.), Ser. A, MBIA 10.675s, 2/15/24 ($21,400,000
par acquired 10/3/91, cost $22,955,243; $3,300,000
par acquired 4/8/92, cost $3,546,169) (c) AAA 28,127,125
NY State Med. Care Fac. Fin. Agcy. Rev. Bonds
5,450,000 (Hosp. & Nursing Home Insd. Mtge.), Ser. B, FHA Insd.,
10 1/2s, 1/15/24 A 5,559,000
1,000,000 (Hosp. & Nursing Home Insd. Mtge.), Ser. B, FHA Insd.,
9 1/8s, 2/15/25 AA 1,052,500
4,000,000 (Hosp. & Nursing Home Insd. Mtge.), Ser. C, FHA Insd.,
9s, 2/15/26 Aa 4,190,000
335,000 (Hosp. & Nursing Home Insd. Mtge.), Ser. B, FHA Insd.,
8 7/8s, 8/15/27 AA 373,944
3,620,000 (Mental Hlth. Svcs. Fac.), Ser. A, 8 7/8s, 8/15/07 Baa 4,054,400
3,230,000 (Mental Hlth. Svcs. Fac.), Rev. A, 8 7/8s, 8/15/97 AAA 3,686,238
12,730,000 (Hosp. & Nursing Home), Ser. B, FHA Insd., 8s, 2/15/28 AAA 14,082,563
8,750,000 (Hosp. & Nursing Home Insd. Mtge.), Ser. A, FHA Insd.,
8s, 2/1/27 AA 9,690,625
6,150,000 (Mental Hlth. Svcs. Fac.), Ser. B, 7 7/8s, 8/15/20 Baa 6,872,625
7,985,000 (Mental Hlth. Svcs. Fac.), Ser. B, 7 7/8s, 8/15/00 AAA 9,312,506
7,275,000 (Mental Hlth. Svcs. Fac.), Ser. A, 7.8s, 2/15/19 AAA 7,984,313
13,725,000 (Mental Hlth. Svcs. Fac. ), Ser. A, 7.8s, 2/15/99 AAA 15,560,719
22,525,000 (Presbyterian Hosp.), Ser. A, FHA Insd., 7.7s, 2/15/25 AA 25,988,219
5,000,000 (Buffalo Gen. Hosp.), Ser. C, FHA Insd., 7.7s, 2/15/22 AAA 5,487,500
9,780,000 (Mental Hlth. Svcs. Fac.), Ser. B, 7 5/8s, 8/15/17 Baa 10,635,750
9,225,000 (Mental Hlth. Svcs. Fac.), Ser. A, 7 1/2s, 2/15/21 Baa 10,159,031
24,775,000 (Mental Hlth. Svcs. Fac.), Ser. A, 7 1/2s, 2/15/01 AAA 28,460,281
18,500,000 (St. Luke's Hosp.), Ser. B, FHA Insd., 7.45s, 2/15/29 AAA 20,997,500
590,000 (Mental Hlth. Svcs. Fac.), Ser. C, 7.3s, 2/15/21 Baa 649,000
1,785,000 (Mental Hlth. Svcs. Fac.), Ser. C, 7.3s, 2/15/01 AAA 2,043,825
10,730,000 (Insd. Mtge. Hosp.), FHA Insd., 7 1/4s, 2/15/12 AA 11,548,163
5,175,000 (Beth Israel Med. Ctr Project), Ser. A, 7.2s, 11/1/14 A 5,414,344
1,205,000 (Hosp. & Nursing Home), Ser. B, FHA Insd., 7s, 8/15/32 AA 1,280,313
24,000,000 (Hosp. & Nursing Home), Ser. B, FHA Insd., 6.95s,
2/15/32 AA 25,110,000
3,000,000 (Hosp. & Nursing Home), Ser. A, FHA Insd., 6 7/8s,
2/15/32 AA 3,120,000
6,625,000 (Methodist Hosp. & Nursing Home), Ser. A, FHA Insd.,
6.7s, 8/15/23 AA 6,856,875
1,200,000 (Hosp. & Nursing Home), Ser. C, 6.55s, 8/15/12 Aa 1,227,000
1,250,000 (Aurelia Osborn Fox Hosp.), Ser. A, 6 1/2s, 11/1/19 AAA 1,289,063
2,000,000 (Longterm Hlth. Care), Ser. C, 6.4s, 11/1/14 AAA 2,052,500
</TABLE>
16
<PAGE>
<TABLE>
<CAPTION>
MUNICIPAL BONDS AND NOTES
PRINCIPAL AMOUNT RATINGS (b) VALUE
NEW YORK(continued)
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
$ 6,000,000 (Hosp. & Nursing Home), Ser. A, FHA Insd., 6.3s,
8/15/23 AA $ 6,007,500
13,700,000 (Hosp. & Nursing Home Insd. Mtge.), Ser. B, FHA Insd.,
6.2s, 8/15/22 AAA 13,545,875
2,000,000 (Central Suffolk Cnty. Hosp. Project), Ser. A, 6 1/8s,
11/1/16 BBB 1,855,000
37,860,000 Ser. A, 5.9s, 8/15/33 AA 35,351,775
5,000,000 (Hosp. & Nursing Home), Ser. C, FHA Insd., 5 3/4s,
8/15/19 AAA 4,662,500
17,350,000 (St. Lukes Roosevelt Project), Ser. A, FHA Insd., 5.7s,
2/15/29 AAA 15,723,438
5,000,000 (Mental Hlth. Svcs. Fac.), Ser. A, AMBAC, 5.7s, 8/15/14 AAA 4,768,750
8,140,000 (St. Lukes-Roosevelt Project), Ser. A, FHA Insd., 5
5/8s, 8/15/18 AAA 7,448,100
11,000,000 (Presbyterian Hosp.), Ser. A, 5 3/8s, 2/15/25 AAA 9,556,250
6,000,000 (Mental Hlth. Svcs. Fac.), Ser. D, 5 3/8s, 8/15/13 Baa 5,310,000
2,725,000 (Mental Hlth. Svcs. Fac. ), Ser. A, 5 1/4s, 8/15/23 Baa 2,268,563
4,785,000 (Mental Hlth. Svcs. Fac.), Ser. D, 5 1/4s, 8/15/23 Baa 4,025,381
16,290,000 (Mental Hlth. Svcs. Fac.), Ser. F, 5 1/4s, 2/15/19 Baa 13,927,950
NY State Med. Care Fac. Fin. Agcy. Secured Hosp. Rev.
Bonds
12,235,000 Ser. A, 7.4s, 8/15/21 Baa 13,320,856
6,500,000 Ser. A, 7.35s, 8/15/11 Baa 7,052,500
5,000,000 NY State Med. Care Fac. Fin. Agcy. Secured Hosp. Rev.
Bonds Ser. A, 6 1/4s, 2/15/24 Baa 4,831,250
NY State Mtge. Agcy. Rev. Bonds
3,260,000 (Homeownership Dev. Program), Ser. BB-2, 7.95s,
10/1/15 Aa 3,435,225
5,000,000 (Homeownership Dev. Program), Ser. QQ, 7.7s, 10/1/12 Aa 5,337,500
1,000,000 (Homeownership Dev. Program), Ser. TT, 7 1/2s, 4/1/15 Aa 1,072,500
5,000,000 (Homeownership Dev. Program), Ser. 27, 6.9s, 4/1/15 Aa 5,175,000
12,515,000 Ser. A, 6 7/8s, 4/1/17 Aa 12,718,369
5,000,000 5.65s, 4/1/15 Aa 4,637,500
2,500,000 5.4s, 10/1/17 Aa 2,196,875
2,600,000 5 3/8s, 10/1/17 Aa 2,291,250
44,585,000 (Single-Fam.) Ser. 2, zero%, 10/1/14 Aa 6,743,481
4,250,000 NY State Muni. Bond Bank Agcy. Special Program Rev.
Bonds, Ser. A, 6 3/4s, 3/15/11 A 4,590,000
5,400,000 NY State Pwr. Auth. General Purpose Rev. Bonds
Ser. U, 5 3/4s, 1/1/18 AA 5,069,250
NY State Thruway Auth. Svc. Contract Rev. Bonds (Local Hwy. &
Bridge Project)
13,300,000 7 1/4s, 1/1/10 Baa 14,114,625
6,500,000 6 1/4s, 4/1/07 Baa 6,597,500
20,365,000 6s, 1/1/11 Baa 19,626,769
9,525,000 5 1/4s, 4/1/13 Baa 8,322,469
NY State Urban Dev. Corp. Rev. Bonds
9,000,000 (Onondaga Cnty. Convention Project), 7 7/8s, 1/1/20 Baa 9,990,000
23,250,000 (State Fac.), 7 1/2s, 4/1/20 Baa 25,400,625
33,250,000 (Correctional Fac.), Ser. 2, 7 1/2s, 1/1/18 Aaa 38,112,813
5,000,000 (Correctional Fac.), Ser. 3, 7s, 1/1/21 Aaa 5,625,000
8,000,000 (Correctional Fac.), Ser. A, 5 1/2s, 1/1/16 Baa 7,100,000
10,750,000 (Correctional Fac.), 5 1/2s, 1/1/15 Baa 9,567,500
25,000,000 (Correctional Fac.), Ser. A, 5 1/4s, 1/1/21 Baa 20,937,500
</TABLE>
17
<PAGE>
<TABLE>
<CAPTION>
MUNICIPAL BONDS AND NOTES
PRINCIPAL AMOUNT RATINGS (b) VALUE
NEW YORK(continued)
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
$ 2,250,000 Newark-Wayne Cnty., Cmnty. Hosp. Rev. Bonds
Ser. B, FHA Insd., 5 7/8s, 1/15/33 AAA $ 2,143,125
Niagara, Frontier Trans. Auth. Arpt. Rev. Bonds
(Buffalo Intl. Airport)
6,000,000 Ser. A, AMBAC, 6 1/4s, 4/1/24 AAA 5,977,500
1,500,000 Ser. C, AMBAC, 6s, 4/1/24 AAA 1,473,750
1,000,000 North Cnty., Dev. Auth. Rev. Bonds
(Solid Waste Mgmt. Syst.), Ser. A, 6 3/4s, 7/1/12 Baa 1,017,500
5,000,000 Onondaga Cnty. Indl. Dev. Agcy. Swr. Fac. Rev. Bonds
(Bristol-Meyers Squibb Co. Project), 5 3/4s, 3/1/24 AAA 4,706,250
Onondaga Cnty., G.O. Bonds
2,600,000 5.7s, 4/1/10 AA 2,570,750
2,600,000 5.7s, 4/1/08 AA 2,557,750
2,800,000 Ontario Cnty., Indl. Dev. Agcy. Res. Recvy. Rev. Bonds
(High Tech. Fac. Group), 7 3/8s, 5/1/96 A 2,842,000
Port Auth. of NY & NJ Cons. Bonds
11,000,000 53rd Ser., 8.7s, 7/15/20 AA 11,756,250
10,000,000 Ser. 67, 6 7/8s, 1/1/25 AA 10,562,500
8,600,000 Port Auth. of NY & NJ Cons. RIBS 10.334s,
8/1/26 (acquired 8/29/91, cost $8,789,873) (d) AA 9,266,500
5,250,000 Ser. 51-E, 12s, 12/1/14 AA/P 5,453,438
Rockland Cnty., Swr. Dist. Rev. Bonds
1,000,000 7.7s, 6/1/16 AA 1,101,250
1,000,000 7.7s, 6/1/15 AA 1,101,250
900,000 7.7s, 6/1/14 AA 991,125
1,250,000 Schenectady, Indl. Dev. Agcy. Rev. Bonds
(Broadway Ctr. Project), 7 3/8s, 9/1/09 AAA 1,375,000
7,000,000 Syracuse, Indl. Dev. Agcy. Civic Fac. VRDN, 7s, 4/1/18 AA/P 7,000,000
Triborough Bridge & Tunnel Auth. General Purpose Rev.
Bonds
38,750,000 (Convention Ctr. Project), Ser. E, 7 1/4s, 1/1/10 Baa 42,479,688
4,750,000 Ser. Y, 6 1/8s, 1/1/21 A 4,761,875
16,925,000 Ser. Q, 6s, 1/1/13 Aa 16,628,813
12,500,000 (Convention Ctr. Project), Ser. E, 6s, 1/1/11 Baa 12,093,750
14,575,000 Ser. P, 5 1/2s, 1/1/19 A 13,245,031
7,000,000 Ser. B, zero% 1/1/22 Aa 1,233,750
5,000,000 Ser. B, zero% 1/1/21 Aa 937,500
27,570,000 Ser. B, zero% 1/1/15 Aa 7,616,213
18,000,000 Triborough Bridge & Tunnel Auth. Special Oblig. RIBS
MBIA 8.58s, 1/1/12 (acquired 7/10/92,
cost $18,135,000) (c) AAA 18,270,000
5,000,000 Triborough Bridge & Tunnel Auth. Special Oblig. VRDN
FGIC, 2.6s, 1/1/24 VMIG1 5,000,000
1,300,000 United Nations Dev. Corp. Rev. Bonds
(Sr. Lien, Phase 2 & 3), Ser. A, 7 7/8s, 7/1/26 Aaa 1,415,375
White Plains, G.O. Rev. Bonds
1,000,000 4.7s, 1/15/06 Aa 913,750
1,000,000 4.6s, 1/15/05 Aa 918,750
-------------
2,162,096,145
<CAPTION>
PUERTO RICO(5.6%)
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
38,500,000 Cmnwlth. of Puerto Rico, Aqueduct & Swr. Auth. Rev.
Bonds Ser. A, 7 7/8s, 7/1/17 BBB 42,013,125
22,120,000 Cmnwlth. of Puerto Rico, G.O. SWAP
5.315s, 7/1/09 A 6,718,950
</TABLE>
18
<PAGE>
<TABLE>
<CAPTION>
MUNICIPAL BONDS AND NOTES
PRINCIPAL AMOUNT RATINGS (b) VALUE
PUERTO RICO(continued)
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
$ 4,000,000 Cmnwlth. of Puerto Rico, Hwy. & Trans. Auth. VRDN
Ser. X, 2.55s, 7/1/99 VMIG1 $ 4,000,000
Puerto Rico Elec. Pwr. Auth. Rev. Bonds
12,345,000 Ser. I, 10 1/4s, 7/1/09 AAA 12,777,075
7,500,000 Ser. J, 9 1/8s, 7/1/15 AAA 8,118,750
68,500,000 Ser. N, zero%, 7/1/17 A 15,669,375
11,175,000 Ser. O, zero%, 7/1/17 A 2,556,281
8,965,000 Puerto Rico Hsg. Bank & Fin. Agcy. Single Fam. Rev.
Bonds 7 1/4s, 12/1/06 AAA 9,402,044
1,253,557 Puerto Rico Hsg. Fin. Corp. Rev. Bonds
(Bayamon Hsg. Dev. Project), 7 1/2s, 7/1/21 Baa 1,335,038
3,000,000 Puerto Rico Indl. Med. & Poll. Ctl. Fac. Rev. Bonds
5.1s, 12/1/18 Aaa 2,640,000
6,925,000 Puerto Rico Pub. Bldg. Auth. Fac. RIBS 10.34s,
7/1/02 (acquired 6/10/93, cost $8,906,404) (c) Baa 8,612,969
11,350,000 Puerto Rico Tel. Auth. RIBS 8.676s,
1/1/20 (acquired 9/28/92, cost $10,981,125) (c) A 11,123,000
3,865,000 U. of Puerto Rico Rev. Bonds, Ser. I, 10 5/8s, 6/1/04 AAA 3,980,950
-------------
128,947,557
-------------
Total Investments (cost $2,171,311,135) $2,291,043,702
=============
</TABLE>
(a) Percentages indicated are based on net assets of $2,321,955,384, which
correspond to a net asset value per class A share and class B share of
$8.79 and $8.77, respectively.
(b) The Moody's or Standard & Poor's ratings indicated are believed to be
the most recent ratings available at May 31, 1994 for the securities
listed. Ratings are generally ascribed to securities at the time of
issuance. While the rating agencies may from time to time revise such
ratings, they undertake no obligation to do so, and the ratings indicated
do not necessarily represent ratings which the agencies would ascribe to
these securities at May 31, 1994. Securities rated by Putnam are indicated
by "/P" and are not publicly rated.
(c) Restricted as to public resale. At the date of acquisition, these
securities were valued at cost. There were no outstanding unrestricted
securities of the same class as those held. Total market value of
restricted securities held at May 31, 1994 was $112,668,344 or 4.9% of net
assets.
(d) This security, having a total value of $19,125,000 or 0.8% of net assets
has been purchased on a "forward commitment" basis, that is, the Fund has
agreed to take delivery of and make payment for this security beyond the
settlement time of five business days after the trade date and subsequent
to the date of this report. The purchase price and interest rate of this
security are fixed at the trade date although the fund does not earn any
interest on this security until the settlement date.
(e) The aggregate identified cost on a tax basis is $2,173,300,345,
resulting in gross unrealized appreciation and depreciation of $150,694,355
and $32,950,998, respectively, or net unrealized appreciation of
$117,743,357.
The rates shown on Residual Interest Bonds (RIBS) and Variable Rate Demand
Notes (VRDN) and fixed interest rate SWAPS are the current interest rates
at May 31, 1994 which are subject to change based on the terms of the
security.
The Fund had the following industry group concentrations greater than 10%
at May 31, 1994 (as a percentage of net assets):
Healthcare 19.9%
Education 19.2
Transportation 15.5
19
<PAGE>
U.S. TREASURY BOND FUTURES CONTRACTS
OUTSTANDING AT MAY 31, 1994 (aggregate face value $204,917,800)
<TABLE>
<CAPTION>
Number of Contracts Expiration Date/Strike Price Unrealized Depreciation
- -------------------------------------------------------------------------------------------------------
<C> <S> <C> <C>
2,000 US Treasury Bond Futures (Sell) Sept 94/104 $ (19,700)
- -------------------------------------------------------------------------------------------------------
</TABLE>
20
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
May 31, 1994 (Unaudited)
<TABLE>
<CAPTION>
ASSETS
- ----------------------------------------------------------------------------------------------------
<S> <C>
Investments in securities, at value
(identified cost $2,171,311,135) (Note 1) $2,291,043,702
- ----------------------------------------------------------------------------------------------------
Cash 1,520,920
- ----------------------------------------------------------------------------------------------------
Receivable for variation margin 1,148,090
- ----------------------------------------------------------------------------------------------------
Interest receivables 43,532,159
- ----------------------------------------------------------------------------------------------------
Receivable for shares of the Fund sold 5,006,527
- ----------------------------------------------------------------------------------------------------
Receivable for securities sold 32,624,215
- ----------------------------------------------------------------------------------------------------
Total assets $2,374,875,613
LIABILITIES
- ----------------------------------------------------------------------------------------------------
Payable for securities purchased $ 35,934,516
- ----------------------------------------------------------------------------------------------------
Payable for shares of the Fund repurchased 7,849,203
- ----------------------------------------------------------------------------------------------------
Distributions payable to shareholders 4,984,931
- ----------------------------------------------------------------------------------------------------
Payable for compensation of Manager (Note 2) 2,797,330
- ----------------------------------------------------------------------------------------------------
Payable for administrative services (Note 2) 9,797
- ----------------------------------------------------------------------------------------------------
Payable for investor servicing and custodian fees (Note 2) 424,553
- ----------------------------------------------------------------------------------------------------
Payable for distribution fees 864,566
- ----------------------------------------------------------------------------------------------------
Other accrued expenses 55,333
- ----------------------------------------------------------------------------------------------------
Total liabilities 52,920,229
- ----------------------------------------------------------------------------------------------------
Net assets $2,321,955,384
- ----------------------------------------------------------------------------------------------------
Represented by
Paid-in capital (Notes 4 and 5) $2,231,915,060
Undistributed net investment income 1,085,747
Accumulated net realized loss on investment transactions (30,758,290)
Net unrealized appreciation of investments 119,712,867
- ----------------------------------------------------------------------------------------------------
Total -- Representing net assets applicable to
capital shares outstanding $2,321,955,384
- ----------------------------------------------------------------------------------------------------
Computation of net asset value and offering price
Net asset value and redemption price per class A share
($2,146,630,598 divided by 244,249,972 shares) $8.79
-------------
Offering price per class A share (100/95.25 of $8.79)* $9.23
Net asset value and redemption price per class B share
($175,324,786 divided by 19,987,383 shares)+ $8.77
- ----------------------------------------------------------------------------------------------------
</TABLE>
* On single retail sales of less than $50,000.
On sales of $50,000 or more and on group sales the offering price is reduced.
+ Redemption price per share is equal to net asset value less any
applicable contingent deferred sales charge.
The accompanying notes are an integral part of these financial statements.
21
<PAGE>
STATEMENT OF OPERATIONS
Six months ended May 31, 1994 (Unaudited)
<TABLE>
<S> <C>
- --------------------------------------------------------------------------------------------------------
Tax exempt interest income $76,998,512
Expenses:
- --------------------------------------------------------------------------------------------------------
Compensation of Manager (Note 2) $ 5,668,311
- --------------------------------------------------------------------------------------------------------
Investor servicing and custodian fees (Note 2) 952,467
- --------------------------------------------------------------------------------------------------------
Compensation of Trustees (Note 2) 23,706
- --------------------------------------------------------------------------------------------------------
Reports to shareholders 18,229
- --------------------------------------------------------------------------------------------------------
Auditing 31,892
- --------------------------------------------------------------------------------------------------------
Legal 19,740
- --------------------------------------------------------------------------------------------------------
Postage 8,812
- --------------------------------------------------------------------------------------------------------
Registration fees 55,372
- --------------------------------------------------------------------------------------------------------
Administrative services (Note 2) 20,166
- --------------------------------------------------------------------------------------------------------
Distribution fees -- Class A (Note 2) 2,243,772
- --------------------------------------------------------------------------------------------------------
Distribution fees -- Class B (Note 2) 703,932
- --------------------------------------------------------------------------------------------------------
Other expenses 94,696
- --------------------------------------------------------------------------------------------------------
Total expenses 9,841,095
- --------------------------------------------------------------------------------------------------------
Net investment income 67,157,417
- --------------------------------------------------------------------------------------------------------
Net realized loss on investments (Notes 1 and 3) (15,719,931)
- --------------------------------------------------------------------------------------------------------
Net realized gain on future contracts (Notes 1 and 3) 1,155,596
- --------------------------------------------------------------------------------------------------------
Net unrealized depreciation of investments and future
contracts during the period (113,798,689)
- --------------------------------------------------------------------------------------------------------
Net loss on investment transactions (128,363,024)
- --------------------------------------------------------------------------------------------------------
Net decrease in net assets resulting from operations $ (61,205,607)
- --------------------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
22
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
Six months ended Year ended
May 31 November 30
- ------------------------------------------------------------------------------------------------------------------
1994* 1993
<S> <C> <C>
INCREASE (DECREASE ) IN NET ASSETS
- ------------------------------------------------------------------------------------------------------------------
Operations:
- ------------------------------------------------------------------------------------------------------------------
Net investment income $ 67,157,417 $ 126,909,777
- ------------------------------------------------------------------------------------------------------------------
Net realized gain (loss) on investments (15,719,931) 36,648,077
- ------------------------------------------------------------------------------------------------------------------
Net realized gain (loss) on future contracts 1,155,596 (13,832,372)
- ------------------------------------------------------------------------------------------------------------------
Net unrealized appreciation
(depreciation) of investments (113,798,689) 95,362,861
- ------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets
resulting from operations (61,205,607) 245,088,343
DISTRIBUTIONS TO SHAREHOLDERS FROM:
- ------------------------------------------------------------------------------------------------------------------
Net investment income -- class A (61,622,171) (122,826,647)
- ------------------------------------------------------------------------------------------------------------------
Net investment income -- class B (4,093,228) (3,368,397)
- ------------------------------------------------------------------------------------------------------------------
Net realized gain on investments -- class A (27,913,842) (22,277,277)
- ------------------------------------------------------------------------------------------------------------------
Net realized gain on investments -- class B (1,862,502) --
- ------------------------------------------------------------------------------------------------------------------
In excess of net realized gain on investments -- (4,353,395)
- ------------------------------------------------------------------------------------------------------------------
Increase from capital share
transactions (Note 4) 51,393,692 374,496,587
- ------------------------------------------------------------------------------------------------------------------
Total increase (decrease) in net assets (105,303,658) 466,759,214
NET ASSETS
- ------------------------------------------------------------------------------------------------------------------
Beginning of period 2,427,259,042 1,960,499,828
- ------------------------------------------------------------------------------------------------------------------
End of period (including undistributed
and distributions in excess of net investment
income of $1,085,747 and $(476,652),
respectively) $2,321,955,384 $2,427,259,042
- ------------------------------------------------------------------------------------------------------------------
</TABLE>
* Unaudited.
The accompanying notes are an integral part of these financial statements.
23
<PAGE>
FINANCIAL HIGHLIGHTS*
(For a share outstanding throughout the period)
<TABLE>
<CAPTION>
For the period
January 4, 1993
Six (commencement Six
months ended of operations) to months ended
May 31 November 30 May 31
- --------------------------------------------------------------------------------- -----------------------------------------
1994 1993 1994 1993 1992
- --------------------------------------------------------------------------------- -----------------------------------------
Class B Class A
- --------------------------------------------------------------------------------- -----------------------------------------
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $ 9.37 $8.95 $9.38 $8.98 $8.75
- --------------------------------------------------------------------------------- -----------------------------------------
INVESTMENT OPERATIONS
Net Investment Income .22 .40 .26 .53 .57
- --------------------------------------------------------------------------------- -----------------------------------------
Net Realized and Unrealized
Gain (Loss) on Investments (.47) .42 (.48) .52 .32
- --------------------------------------------------------------------------------- -----------------------------------------
Total from Investment Operations (.25) .82 (.22) 1.05 .89
- --------------------------------------------------------------------------------- -----------------------------------------
Less Distributions from:
Net Investment Income (.23) (.40) (.25) (.53) (.58)
- --------------------------------------------------------------------------------- -----------------------------------------
Net Realized Gain on Investments (.12) -- (.12) (.10) (.08)
- --------------------------------------------------------------------------------- -----------------------------------------
In Excess of Net Realized Gain on Investments -- -- -- (.02) --
- --------------------------------------------------------------------------------- -----------------------------------------
Total Distributions (.35) (.40) (.37) (.65) (.66)
- --------------------------------------------------------------------------------- -----------------------------------------
Net Asset Value, End of Period $8.77 $9.37 $8.79 $9.38 $8.98
- --------------------------------------------------------------------------------- -----------------------------------------
Total Investment Return at
Net Asset Value (%) (a) (5.72)(b) 10.16(b) (4.96)(b) 12.02 10.60
- --------------------------------------------------------------------------------- -----------------------------------------
NET ASSETS, END OF PERIOD (IN THOUSANDS) $175,325 $146,665 $2,146,631 $2,280,604 $1,960,500
- --------------------------------------------------------------------------------- -----------------------------------------
Ratio of Expenses to Average
Net Assets (%) 1.43(b) 1.44(b) .77(b) .76 .66
- --------------------------------------------------------------------------------- -----------------------------------------
Ratio of Net Investment Income
to Average Net Assets (%) 4.98(b) 4.83(b) 5.65(b) 5.67 6.44
- --------------------------------------------------------------------------------- -----------------------------------------
Portfolio Turnover (%) 24.18(c) 26.60 24.18(c) 26.60 20.13
- --------------------------------------------------------------------------------- -----------------------------------------
</TABLE>
24
<PAGE>
<TABLE>
<CAPTION>
Two months
Year ended ended Year ended
November 30 Nov. 30 September 30
- -------------------------------------------------------------------------------------------------------------------------------
1991 1990 1989 1988 1987 1987 1986
- -------------------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period $8.34 $8.61 $8.33 $7.99 $7.76 $8.56 $7.57
- -------------------------------------------------------------------------------------------------------------------------------
INVESTMENT OPERATIONS
Net Investment Income .58 .58 .60 .61 .11 .60 .65
- -------------------------------------------------------------------------------------------------------------------------------
Net Realized and Unrealized
Gain (Loss) on Investments .42 (.23) .27 .39 .22 (.72) .99
- -------------------------------------------------------------------------------------------------------------------------------
Total from Investment Operations 1.00 .35 .87 1.00 .33 (.12) 1.64
- -------------------------------------------------------------------------------------------------------------------------------
Less Distributions from:
Net Investment Income (.59) (.56) (.59) (.60) (.10) (.61) (.65)
- -------------------------------------------------------------------------------------------------------------------------------
Net Realized Gain on Investments -- (.06) -- (.06) -- (.07) --
- -------------------------------------------------------------------------------------------------------------------------------
In Excess of Net Realized Gain on Investments -- -- -- -- -- -- --
- -------------------------------------------------------------------------------------------------------------------------------
Total Distributions (.59) (.62) (.59) (.66) (.10) (.68) (.65)
- -------------------------------------------------------------------------------------------------------------------------------
Net Asset Value, End of Period $8.75 $8.34 $8.61 $8.33 $7.99 $7.76 $8.56
- -------------------------------------------------------------------------------------------------------------------------------
Total Investment Return at
Net Asset Value (%) (a) 12.44 4.37 10.77 12.99 25.41(b) (1.76) 22.41
- -------------------------------------------------------------------------------------------------------------------------------
NET ASSETS, END OF PERIOD (IN THOUSANDS) $1,659,383 $1,416,555 $1,313,050 $1,063,650 $958,201 $950,417 $701,799
- -------------------------------------------------------------------------------------------------------------------------------
Ratio of Expenses to Average
Net Assets (%) .63 .56 .57 .54 .48(b) .55 .56
- -------------------------------------------------------------------------------------------------------------------------------
Ratio of Net Investment Income
to Average Net Assets (%) 6.84 6.96 6.94 7.34 7.95(b) 7.08 7.81
- -------------------------------------------------------------------------------------------------------------------------------
Portfolio Turnover (%) 49.91 17.22 42.87 31.91 12.90(c) 43.28 50.45
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>
* Financial Highlights for periods ended through November 30, 1992 have
been reclassified and data has been presented to conform with requirements
issued by the SEC in April 1993. The table has been restated to reflect a 2-
for-1 share split, class A only, declared by the fund to shareholders of
record on October 27, 1989 payable on October 28, 1989.
(a) Total investment return assumes dividend reinvestment and does not reflect
the effect of sales charges.
(b) Annualized.
(c) Not annualized.
25
<PAGE>
NOTES TO FINANCIAL STATEMENTS
May 31, 1994 (Unaudited)
NOTE 1
SIGNIFICANT ACCOUNTING POLICIES
The fund is registered under the Investment Company Act of 1940, as amended,
as a diversified, open-end management investment company. The fund seeks as
high a level of current income exempt from federal income tax and New York
State and City personal income tax as Putnam Management believes is
consistent with preservation of capital by investing primarily in a portfolio
of longer-term New York tax exempt securities.
The fund offers both class A and class B shares. Class A shares are sold with
a maximum front-end sales charge of 4.75%. Class B shares do not pay a
front-end sales charge, but pay a higher ongoing distribution fee than class
A shares, and may be subject to a contingent deferred sales charge if those
shares are redeemed within six years of purchase. Expenses of the fund are
borne pro-rata by the holders of both classes of shares, except that each
class bears expenses unique to that class (including the distribution fees
applicable to such class) and votes as a class only with respect to its own
distribution plan or other matters on which a class vote is required by law
or determined by the Trustees. Shares of each class would receive their
pro-rata share of the net assets of the fund, if the fund were liquidated. In
addition, the Trustees declare separate dividends on each class of shares.
The following is a summary of significant accounting policies consistently
followed by the fund in the preparation of its financial statements. The
policies are in conformity with generally accepted accounting principles.
A SECURITY VALUATION Tax-exempt bonds and notes are stated on the basis of
valuations provided by a pricing service, approved by the Trustees, which uses
information with respect to transactions in bonds, quotations from bond dealers,
market transactions in comparable securities and various relationships between
securities in determining value. The fair value of restricted securities is
determined by the Manager following procedures approved by the Trustees.
B SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME Security transactions
are accounted for on the trade date (date the order to buy or sell is executed).
Interest income is recorded on the accrual basis.
C FUTURES A futures contract is an agreement between two parties to buy and
sell a security at a set price on a future date. Upon entering into such a
contract, the fund is required to pledge to the broker an amount of cash or tax-
exempt securities equal to the minimum "initial margin" requirements of the
exchange. Pursuant to the contract, the fund agrees to receive from or pay to
the broker an amount of cash equal to the daily fluctuation in value of the
contract. Such receipts or payments are known as "variation margin," and are
recorded by the fund as unrealized gains or losses. When the contract is closed,
the fund records a realized gain or loss equal to the difference between the
value of the contract at the time it was opened and the value at the time it was
closed. The potential risk to the fund is that the change in value of the
underlying securities may not correspond to the change in value of the futures
contracts.
D FEDERAL TAXES It is the policy of the fund to distribute all of its income
within the prescribed time and otherwise comply with the provisions of the
Internal
26
<PAGE>
Revenue Code applicable to regulated investment companies. It is also the
intention of the fund to distribute an amount sufficient to avoid imposition of
any excise tax under Section 4982 of the Internal Revenue Code of 1986.
Therefore, no provision has been made for federal taxes on income, capital gains
or unrealized appreciation of securities held and excise tax on income and
capital gains.
E DISTRIBUTIONS TO SHAREHOLDERS Income dividends are recorded daily by the
fund and are distributed to the shareholders monthly. Capital gains
distributions, if any, are recorded on the ex-dividend date and paid annually.
F AMORTIZATION OF BOND PREMIUM AND DISCOUNT Any premium resulting from the
purchase of securities is amortized using the effective yield method for bonds
issued after September 27, 1985 and on a straight-line basis for bonds issued
prior thereto. The premium in excess of the call price, if any, is amortized to
the call date; thereafter, the remaining excess premium is amortized to
maturity. Discount on zero-coupon bonds is accreted according to the effective
yield method.
NOTE 2
MANAGEMENT FEE, ADMINISTRATIVE SERVICES, AND OTHER TRANSACTIONS
Compensation of Putnam Investment Management Inc., the fund's Manager, a wholly-
owned subsidiary of Putnam Investments, Inc., for management and investment
advisory services is paid quarterly based on the average net assets of the fund
for the quarter. Such fee is based on the following annual rates: 0.6% of the
first $500 million of average net assets, 0.5% of the next $500 million, 0.45%
of the next $500 million and 0.4% of any amount over $1.5 billion, subject to
reduction in any year to the extent of certain brokerage commissions and fees
(less expenses) received by affiliates of the Manager on the fund's portfolio
transactions.
The fund also reimburses the Manager for the compensation and related expenses
of certain officers of the fund and their staff who provide administrative
services to the fund. The aggregate amount of all such reimbursements is
determined annually by the Trustees. For the six months ended May 31, 1994, the
fund paid $20,166 for these services.
Trustees of the fund receive an annual Trustee's fee of $3,000 and an
additional fee for each Trustees' meeting attended. Trustees who are not
interested persons of the Manager and who serve on committees of the Trustees
receive additional fees for attendance at certain committee meetings.
Custodial functions are being provided to the fund by Putnam Fiduciary Trust
Company (PFTC), a subsidiary of the Putnam Investments, Inc. Investor
servicing agent functions are provided by Putnam Investor Services, a
division of PFTC. Fees paid for these investor servicing and custodial
functions for the six months ended May 31, 1994 amounted to $952,467.
Investor servicing and custodian fees reported in the Statement of operations
for the six months ended May 31, 1994 have been reduced by credits allowed by
PFTC.
The fund has adopted a distribution plan with respect to its class A shares
(the "Class A Plan") pursuant to Rule 12b-1 under the Investment Company Act
of 1940. The purpose of the Class A Plan is to compensate Putnam Mutual Funds
Corp., a wholly-owned subsidiary of Putnam Investments, Inc., for
services provided and expenses incurred by it in distributing class A shares.
The Trustees have approved
27
<PAGE>
payment by the fund to Putnam Mutual Funds Corp. at an annual rate of 0.20% of
the fund's average net assets attributable to class A shares. For the six months
ended May 31, 1994, the fund paid Putnam Mutual Funds Corp. distribution fees of
$2,243,772 for class A shares.
During the six months ended May 31, 1994, Putnam Mutual Funds Corp., acting as
an underwriter, received net commissions of $170,248 from the sale of class A
shares of the fund.
A deferred shales charge of up to 1.00% is assessed on certain redemptions of
class A shares purchased as part of an investment of $1 million or more. For
the six months ended May 31, 1994, Putnam Mutual Funds Corp., acting as an
underwriter, received no monies on such redemptions.
The fund has adopted a separate distribution plan with respect to its class B
shares (the "Class B Plan") pursuant to Rule 12b-1 under the Investment
Company Act of 1940. The purpose of the Class B Plan is to compensate Putnam
Mutual Funds Corp. for services provided and expenses incurred by it in
distributing class B shares. The Class B Plan provides for payments by the
fund to Putnam Mutual Funds Corp. at an annual rate of up to 1.00% of the
fund's average net assets attributable to class B shares. Currently, the
Trustees have limited payments to .85% of such assets. For the six months
ended May 31, 1994, the fund paid Putnam Mutual Funds Corp. distribution fees
of $703,932 for class B shares.
Putnam Mutual Funds Corp. acting as an underwriter, also receives the proceeds
of the contingent deferred sales charges levied on class B share redemptions
within six years of purchase. The charge is based on declining rates, which
begin at 5.00% of the net asset value of the redeemed shares. Putnam Mutual
Funds Corp. has received contingent deferred sales charges of $220,327 from
redemptions for the six months ended May 31, 1994.
NOTE 3
PURCHASES AND SALES OF SECURITIES
During the six months ended May 31, 1994, purchases and sales of investment
securities other than short-term investments aggregated $560,142,050 and
$695,288,598, respectively. Purchases and sales of short-term municipal
obligations aggregated $63,175,000 and $44,400,000, respectively. In
determining the net gain or loss on securities sold, the cost of securities
has been determined on the identified cost basis.
Transactions in treasury bond futures contracts during the period are
summarized as follows:
<TABLE>
<CAPTION>
Sales of Futures Contracts
Number of Aggregate
Contracts Face Value
- ---------------------------------------------------------------
<S> <C> <C>
Contracts opened 9,750 $1,034,424,931
- ---------------------------------------------------------------
Contracts closed (7,750) (829,507,131)
- ---------------------------------------------------------------
Contracts open at
end of period 2,000 $ 204,917,800
- ---------------------------------------------------------------
</TABLE>
28
<PAGE>
NOTE 4
CAPITAL SHARES
At May 31, 1994 there was an unlimited number of shares of beneficial
interest authorized divided into two classes of shares, class A and class B
capital shares. Transactions in capital shares were as follows:
<TABLE>
<CAPTION>
Six months ended May 31, 1994
Class A Shares Amount
- ---------------------------------------------------------------------------
<S> <C> <C>
Shares sold 20,301,500 $ 183,941,949
- ---------------------------------------------------------------------------
Shares issued in connection with
reinvestment of distributions 6,024,354 55,267,888
- ---------------------------------------------------------------------------
26,325,854 239,209,837
- ---------------------------------------------------------------------------
Shares repurchased (25,204,887) (227,710,898)
- ---------------------------------------------------------------------------
Net increase 1,120,967 $ 11,498,939
- ---------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Year ended November 30, 1993
Class A Shares Amount
- ---------------------------------------------------------------------------
<S> <C> <C>
Shares sold 50,423,746 $467,973,918
- ---------------------------------------------------------------------------
Shares issued in connection with
reinvestment of distributions 10,120,185 93,395,071
- ---------------------------------------------------------------------------
60,543,931 561,368,989
- ---------------------------------------------------------------------------
Shares repurchased
(35,707,681) (332,870,429)
- ---------------------------------------------------------------------------
Net increase 24,836,250 $228,498,560
- ---------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Six months ended May 31, 1994
Class B Shares Amount
- ---------------------------------------------------------------------------
<S> <C> <C>
Shares sold 4,966,165 $ 45,527,088
- ---------------------------------------------------------------------------
Shares issued in connection with
reinvestment of distributions
453,500 1,147,169
- ---------------------------------------------------------------------------
5,419,665 49,674,257
- ---------------------------------------------------------------------------
Shares repurchased (1,086,042) (9,779,504)
- ---------------------------------------------------------------------------
Net increase 4,333,623 $ 39,894,753
- ---------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
January 4 (commencement of
operations) to November 30, 1993
Class B Shares Amount
- ---------------------------------------------------------------------------
<S> <C> <C>
Shares sold 16,174,744 $150,893,935
- ---------------------------------------------------------------------------
Shares issued in connection with
reinvestment of distributions
240,160 2,260,582
- ---------------------------------------------------------------------------
16,414,904 153,154,517
- ---------------------------------------------------------------------------
Shares repurchased (761,144) (7,156,490)
- ---------------------------------------------------------------------------
Net increase 15,653,760 $145,998,027
- ---------------------------------------------------------------------------
</TABLE>
29
<PAGE>
NOTE 5
RECLASSIFICATION OF CAPITAL ACCOUNTS
Effective December 1, 1993, Putnam New York Tax Exempt Income Fund has adopted
the provisions of the AICPA Statement of Position (SOP)93-2 "Determination,
Disclosure and Financial Statement Presentation of Income, Capital Gain and
Return of Capital Distributions, by Investment Companies." The purpose of this
SOP is to report the accumulated net realized gain (loss) accounts in such a
manner as to approximate amounts available for future distributions (or to
offset future realized capital gains) and to achieve uniformity in the
presentation of distributions by investment companies.
As a result of SOP, the fund has reclassified $120,381 to increase
undistributed net investment income, $2,843,449 to increase accumulated net
realized loss and $2,723,068 to increase paid in capital.
These adjustments represent the cumulative amounts necessary to report these
balances through November 30, 1993, the close of the fund's most recent
fiscal year end for financial reporting and tax purposes.
30
<PAGE>
FUND INFORMATION
INVESTMENT
MANAGER
Putnam Investment Management, Inc.
One Post Office Square
Boston, MA 02109
MARKETING SERVICES
Putnam Mutual Funds Corp.
One Post Office Square
Boston, MA 02109
CUSTODIAN
Putnam Fiduciary Trust Company
LEGAL COUNSEL
Ropes & Gray
TRUSTEES
George Putnam, Chairman
William Pounds, Vice Chairman
Jameson Adkins Baxter
Hans H. Estin
John A. Hill
Elizabeth T. Kennan
Lawrence J. Lasser
Donald S. Perkins
Robert E. Patterson
George Putnam, III
A.J.C. Smith
W. Nicholas Thorndike
OFFICERS
George Putnam
President
Charles E. Porter
Executive Vice President
Patricia C. Flaherty
Senior Vice President
Lawrence J. Lasser
Vice President
Gordon H. Silver
Vice President
Gary N. Coburn
Vice President
James E. Erickson
Vice President
Thomas C. Goggins
Vice President
and Fund Manager
William N. Shiebler
Vice President
John R. Verani
Vice President
Paul M. O'Neil
Vice President
John D. Hughes
Vice President
and Treasurer
Beverly Marcus
Clerk and Assistant
Treasurer
This report is for the information of shareholders of Putnam New York Tax Exempt
Income Fund. It may also be used as sales literature when preceded or
accompanied by the current prospectus, which gives details of sales charges,
investment objectives, and operating policies of the fund.
31
<PAGE>
THE PUTNAM FUNDS
One Post Office Square
Boston, Massachusetts 02109
----------------
Bulk Rate
----------------
U.S. Postage
PAID
Boston, MA
Permit No. 53749
----------------
30/345-12994
<PAGE>
GRAPHICS APPENDIX LIST
----------------------
Page Where Description of Graphic or Cross -
Graphic Appears Reference
- --------------- ---------------------------------
pg 5 Mountain Graph with dollar values for vertical
axis and 2 years over the horizontal axis.
pg 10 Pyramid image listing categories of Funds
Risk vs Reward with most conservative at
Base.
