MUNIVEST
FUND, INC.
FUND LOGO
Annual Report
August 31, 1995
This report, including the financial information herein, is
transmitted to the shareholders of MuniVest Fund, Inc. for their
information. It is not a prospectus, circular or representation
intended for use in the purchase of shares of the Fund or any
securities mentioned in the report. Past performance results shown
in this report should not be considered a representation of future
performance. The Fund has leveraged its Common Stock by issuing
Preferred Stock to provide the Common Stock shareholders with a
potentially higher rate of return. Leverage creates risks for Common
Stock shareholders, including the likelihood of greater volatility
of net asset value and market price shares of the Common Stock, and
the risk that fluctuations in the short-term dividend rates of the
Preferred Stock may affect the yield to Common Stock shareholders.
<PAGE>
MuniVest Fund, Inc.
Box 9011
Princeton, NJ
08543-9011
MUNIVEST FUND, INC.
The Benefits and
Risks of
Leveraging
MuniVest Fund, Inc. utilizes leveraging to seek to enhance the yield
and net asset value of its Common Stock. However, these objectives
cannot be achieved in all interest rate environments. To leverage,
the Fund issues Preferred Stock, which pays dividends at prevailing
short-term interest rates, and invests the proceeds in long-term
municipal bonds. The interest earned on these investments is paid to
Common Stock shareholders in the form of dividends, and the value of
these portfolio holdings is reflected in the per share net asset
value of the Fund's Common Stock. However, in order to benefit
Common Stock shareholders, the yield curve must be positively
sloped; that is, short-term interest rates must be lower than long-
term interest rates. At the same time, a period of generally
declining interest rates will benefit Common Stock shareholders. If
either of these conditions change, then the risks of leveraging will
begin to outweigh the benefits.
To illustrate these concepts, assume a fund's Common Stock
capitalization of $100 million and the issuance of Preferred Stock
for an additional $50 million, creating a total value of $150
million available for investment in long-term municipal bonds. If
prevailing short-term interest rates are approximately 3% and long-
term interest rates are approximately 6%, the yield curve has a
strongly positive slope. The fund pays dividends on the $50 million
of Preferred Stock based on the lower short-term interest rates. At
the same time, the fund's total portfolio of $150 million earns the
income based on long-term interest rates. Of course, increases in
short-term interest rates would reduce (and even eliminate) the
dividends on the Common Stock.
<PAGE>
In this case, the dividends paid to Preferred Stock shareholders are
significantly lower than the income earned on the fund's long-term
investments, and therefore the Common Stock shareholders are the
beneficiaries of the incremental yield. However, if short-term
interest rates rise, narrowing the differential between short-term
and long-term interest rates, the incremental yield pick-up on the
Common Stock will be reduced or eliminated completely. At the same
time, the market value on the fund's Common Stock (that is, its
price as listed on the American Stock Exchange), may, as a result,
decline.Furthermore, if long-term interest rates rise, the Common
Stock's net asset value will reflect the full decline in the price
of the portfolio's investments, since the value of the fund's
Preferred Stock does not fluctuate. In addition to the decline in
net asset value, the market value of the fund's Common Stock may
also decline.
Officers and
Directors
Arthur Zeikel, President and Director
Ronald W. Forbes, Director
Cynthia A. Montgomery, Director
Charles C. Reilly, Director
Kevin A. Ryan, Director
Richard R. West, Director
Terry K. Glenn, Executive Vice President
Donald C. Burke, Vice President
Vincent R. Giordano, Vice President
Kenneth A. Jacob, Vice President
Gerald M. Richard, Treasurer
Mark B. Goldfus, Secretary
Custodian
The Bank of New York
90 Washington Street
New York, New York 10286
ASE Symbol
MVF
<PAGE>
Transfer Agents
Common Stock:
The Bank of New York
101 Barclay Street
New York, New York 10286
Preferred Stock:
IBJ Schroder Bank & Trust Company
One State Street
New York, New York 10004
TO OUR SHAREHOLDERS
For the year ended August 31, 1995, the Common Stock of MuniVest
Fund, Inc. earned $0.631 per share income dividends, representing a
net annualized yield of 6.63%, based on a month-end per share net
asset value of $9.51. Over the same period, the Fund's total
investment return was +9.38%, based on a change in per share net
asset value from $9.57 to $9.51, and assuming reinvestment of $0.636
per share income dividends and $0.164 capital gains distributions.
For the six months ended August 31, 1995, the Common Stock of
MuniVest Fund, Inc. earned $0.309 per share income dividends,
representing a net annualized yield of 6.44%, based on a month-end
per share net asset value of $9.51. Over the same period, the Fund's
total investment return was +5.88%, based on a change in per share
net asset value from $9.31 to $9.51, and assuming reinvestment of
$.0310 per share income dividends.
For the six months ended August 31, 1995, the Fund's Preferred Stock
had an average dividend yield as follows: Series A, 3.62%; Series B,
4.28%; Series C, 4.17%; Series D, 4.17%; and Series E, 4.05%.
The Environment
During the three months ended August 31, 1995, US economic
indicators continued to suggest that economic growth is moderate and
that the rate of inflation remains low. Gross domestic product (GDP)
growth for the three months ended June 30 were revised to show that
the economy expanded at a 1.1% pace, rather than the 0.5% rate that
was originally reported. However, although the employment report for
August exceeded consensus expectations, most of the new jobs created
were in the service sector, reflecting the ongoing sluggishness in
manufacturing. In addition, total hours worked and hourly wages
declined in August. Other lackluster economic indicators included
disappointing durable goods orders in July and continued poor retail
sales results.
<PAGE>
After gaining ground in recent weeks, the US dollar has strengthened
relative to the yen and the Deutschemark. Improving interest rate
differentials favoring the US currency, combined with coordinated
central bank intervention and more positive investor sentiment, have
helped to bolster the dollar in foreign exchange markets. Other
factors that appear to be improving the US dollar's outlook in the
near term are a pick-up in capital flows to the United States and
the prospect of increased capital outflows from Japan. However, it
remains to be seen if the US dollar's strengthening trend can
continue without significant improvements in the US budget and trade
deficits.
In the weeks ahead, investor interest will continue to focus on US
economic activity. Clear signs of a moderate, noninflationary
expansion would further benefit the US stock and bond markets. In
addition, should the current Federal budget deficit reduction
efforts now underway in Washington prove successful, the
implications would likely be positive for the US financial markets.
The Municipal Market
Although long-term tax-exempt bond yields continued their slow
decline during the six-month period ended August 31, 1995, municipal
bond yields exhibited significant volatility. Over the past six
months, tax-exempt bond yields fluctuated by as much as 25 basis
points (0.25%) on a weekly basis as investors reacted strongly as
successive economic indicators were released. Amid signs that the
strong economic growth seen in the latter half of 1994 was severely
curtailed by the Federal Reserve Board's series of interest rate
increases, investor confidence rose and bond yields fell. By early
June, long-term A-rated uninsured municipal revenue bond yields, as
measured by the Bond Buyer Revenue Bond Index, had declined
approximately 40 basis points to 5.94%. Subsequently, investor
confidence waned as economic indicators signaling a potentially
resurgent economy were released in July and early August. Tax-exempt
bond yields rose to 6.44% in response to a potentially stronger
domestic economy by mid-August. The tax-exempt market rallied to end
the reporting period at 6.26% as investors began to emphasize the
positive impact of low inflation upon long-term bond yields. US
Treasury bond yields exhibited a similar pattern over the last six
months, although the extent of their decline was more dramatic. At
the end of August 1995, the 30-year US Treasury bond yielded 6.65%
after declining almost 80 basis points in the last six months.
<PAGE>
Municipal bonds underperformed US Treasury securities for a number
of reasons. The record highs of the US equity market continued to
attract retail investors seeking further capital gains. Investor
demand was also diminished in recent months by the "sticker shock"
effect that periodically affects the municipal bond market.
Investors who had become accustomed to purchasing tax-exempt
securities in the 6.50%--7.00% range six to seven months ago
demonstrated understandable reluctance to purchase similar
securities at current levels. The strong fundamental structure of
the municipal bond market, however, suggests that such hesitancy may
prove costly.
However, the major reason for the tax-exempt market's recent
underperformance was concerns regarding the implication for
municipal bonds' tax advantage resulting from various proposed tax
law changes (for example, flat tax, value-added tax or national
sales tax) that have reduced investor demand for tax-exempt
products. Such concerns are likely to quickly recede as investors
realize that such, if any, changes are unlikely to be enacted before
late 1996 at the earliest. Long-term investors will also recall
1986 when similar tax proposals were made, municipal bond yields
initially rose, in some instances, to over 100% of taxable yields.
Tax-exempt bond yields quickly declined as investors' fears proved
to be unfounded.
The municipal bond market's strong technical position has diminished
somewhat in recent months. New-issue supply over the last six months
totaled approximately $75 billion, or a decline of over 12% compared
to the corresponding period in 1994. During the last three months,
however, municipalities issued approximately $42 billion in new
securities, which represents less than a 2% decline compared to the
same period a year earlier. Investor demand remained muted in recent
months despite significant funds available to investors. By the end
of August investors, both individual and institutional, are expected
to have received as much as $85 billion from tax-exempt bond
maturities, coupon payments and the proceeds of early bond
redemptions. Little new money has entered the municipal market in
recent months, largely in response to the factors mentioned above.
Consequently, much of the technical support the municipal market
enjoyed earlier this year evaporated, causing municipal bond yields
to decline at a slower rate than their taxable counterparts.
However, the recent relative underperformance of municipal bonds has
made them particularly attractive to long-term investors. Tax-exempt
bonds currently yield well over 90% of US Treasury securities. In
some instances, A-rated, long-term revenue bonds yielded almost 95%
of US Treasury bonds. Analysts usually consider municipal bonds
yielding over 82% of US Treasury securities to be historically
attractive. With inflation-adjusted, "real" after-tax equivalent tax-
exempt yields of over 6.50%, municipal securities appear to
represent considerable value.
<PAGE>
Current tax-exempt yield levels appear to be overcompensating for
any proposed changes in tax law that can reasonably be expected to
be enacted. As Congressional hearings on this matter continue into
1996, and the revenue losses resultant from such changes become more
apparent, the likelihood of any significant changes to tax codes and
the resultant decline of municipal bonds' inherent tax advantage
should decline. Under such a scenario, tax-exempt bond yields could
quickly decline and currently available municipal bond yields would
return to their normal historic relationship.
Portfolio Strategy
During the 12-month period ended August 31, 1995, our portfolio
strategy--and the Fund's performance--can be divided into two
periods. From September to late November 1994, we believed that most
of the rise in interest rates seen during the latter half of 1994
was unwarranted. Consequently, we maintained the Fund's aggressive
portfolio structure. This caused the Fund to underperform market
averages through November 1994. Beginning in December 1994 and
throughout 1995, our positive outlook toward interest rates was
rewarded as bond yields began a significant correction. Since their
highs in November 1994, tax-exempt bond yields have fallen over 100
basis points and bond prices rose accordingly. During this period,
the Fund outperformed industry averages and recouped almost all of
the losses incurred in 1994.
At present, given the extent of the municipal bond market's recent
rally, we have adopted a more neutral outlook toward interest rates.
We plan to limit cash reserves to seek to enhance the Fund's current
income, but we will probably make no significant additional
purchases of interest rate-sensitive securities. The Fund's present
structure allows it to fully participate in any additional market
improvement. Our primary focus continues to be maintaining the
Fund's current high level of tax-exempt income.
Short-term tax-exempt interest rates traded in the 3%--4% range
throughout most of the last six months. As such, the leveraging
effect continues to generate significant beneficial impact on the
yield paid to Common Stock shareholders. However, should the spread
between short-term and long-term interest rates narrow, the benefits
of the leverage will decline and the yield on the Fund's Common
Stock will be reduced. (For a complete explanation on the benefits
and risks of leveraging, see page 1 of this report to shareholders.)
In Conclusion
We appreciate your ongoing interest in MuniVest Fund, Inc., and we
look forward to serving your investment needs and objectives in the
months and years to come.
Sincerely,
(Arthur Zeikel)
Arthur Zeikel
President
<PAGE>
(Vincent R. Giordano)
Vincent R. Giordano
Vice President
(Fred K. Stuebe)
Fred K. Stuebe
Portfolio Manager
September 26, 1995
We are pleased to announce that Fred K. Stuebe is responsible for
the day-to-day management of MuniVest Fund, Inc. Mr. Stuebe has been
employed by Merrill Lynch Asset Management since 1989 as Vice
President and Portfolio Manager. Prior thereto, Mr. Stuebe was
employed by Old Republic Insurance Company since 1984 as Vice
President-Tax-Exempt Investments.
PROXY RESULTS
During the six-month period ended August 31, 1995, MuniVest Fund,
Inc. Common Stock shareholders voted on the following proposals. The
proposals were approved at a special shareholders' meeting on June
16, 1995. The description of each proposal and number of shares
voted are as follows:
<TABLE>
<CAPTION>
Shares Voted Shares Voted
For Without Authority
<S> <S> <C> <C>
1. To elect the Fund's Board of Directors: Cynthia A. Montgomery 57,842,435 1,610,634
Charles C. Reilly 57,834,040 1,619,029
Kevin A. Ryan 57,832,868 1,620,201
Arthur Zeikel 57,836,250 1,616,819
<PAGE>
<CAPTION>
Shares Voted Shares Voted Shares Voted
For Against Abstain
2. To select Deloitte & Touche LLP as the Fund's independent auditors. 57,897,132 504,970 1,050,967
</TABLE>
During the six-month period ended August 31, 1995, MuniVest Fund,
Inc. Preferred Stock shareholders (Series A, B, C, D and E) voted on
the following proposals. The proposals were approved at a special
shareholders' meeting on June 16, 1995. The description of each
proposal and number of shares voted are as follows:
<TABLE>
<CAPTION>
Shares Voted Shares Voted
For Without Authority
<S> <S> <C> <C>
1. To elect the Fund's Board of Directors: Ronald W. Forbes 8,430 268
Richard R. West 8,430 268
<CAPTION>
Shares Voted Shares Voted Shares Voted
For Against Abstain
<S> <C> <C> <C>
2. To select Deloitte & Touche LLP as the Fund's independent auditors. 8,652 4 42
</TABLE>
Portfolio
Abbreviations
To simplify the listings of MuniVest Fund, Inc.'s portfolio holdings
in the Schedule of Investments, we have abbreviated the names of
many of the securities according to the list at right.
AMT Alternative Minimum Tax (subject to)
COP Certificates of Participation
GO General Obligation Bonds
HDA Housing Development Authority
HFA Housing Finance Agency
IDA Industrial Development Authority
IDB Industrial Development Board
IDR Industrial Development Revenue Bonds
INFLOS Inverse Floating Rate Municipal Bonds
M/F Multi-Family
PCR Pollution Control Revenue Bonds
RAW Revenue Anticipation Warrants
RIB Residual Interest Bonds
S/F Single-Family
UT Unlimited Tax
VRDN Variable Rate Demand Notes
<PAGE>
<TABLE>
SCHEDULE OF INVESTMENTS (in Thousands)
<CAPTION>
S&P Moody's Face Value
STATE Ratings Ratings Amount Issue (Note 1a)
<S> <S> <S> <C> <S> <C>
Alabama--2.9% AAA NR* $ 9,740 Alabama HFA, S/F Mortgage Revenue Bonds, Series A, 7.60% due
10/01/2022 (d) $ 10,460
BBB Baa1 8,750 Courtland, Alabama, IDB, Revenue Refunding Bonds (Champion
International Corporation), Series A, 7.20% due 12/01/2013 9,407
BBB Baa1 5,000 Courtland, Alabama, IDB, Solid Waste Disposal Revenue Bonds
(Champion International Corporation Project), AMT, 7% due
6/01/2022 5,178
Alaska--3.6% North Slope Boro, Alaska, Revenue Bonds, UT, Series B (c):
AAA Aaa 6,000 5.10%** due 1/01/2002 4,383
AAA Aaa 6,000 5.20%** due 1/01/2003 4,138
AA- A1 20,750 Valdez, Alaska, Marine Terminal Revenue Refunding Bonds (Sohio
Pipeleine), 7.125% due 12/01/2025 22,493
Arizona--0.3% AAA Aaa 2,220 Arizona State Transportation Board, Excise Tax Revenue Bonds
(Maricopa County Regional Area Road), Series A, 5.75% due
7/01/2004 (h) 2,373
A1+ P1 200 Maricopa County, Arizona, PCR, Refunding (Arizona Public
Service Co.), VRDN, Series B, 3.50% due 5/01/2029 (g) 200
California--1.4% A1 VMIG1++ 200 California Pollution Control Financing Authority, PCR (Southern
California Edison), VRDN, Series A, 3.45% due 2/28/2008 (g) 200
SP1 MIG1++ 6,100 California State, RAW, Series C, 5.75% due 4/25/1996 6,172
University of California, COP (UCLA Central Chiller/
Cogeneration):
NR* Aa 1,245 10.75% due 11/01/1998 1,472
NR* Aa 3,315 10.75% due 11/01/1999 4,065
Colorado--2.8% Denver, Colorado, City and County Airport Revenue Bonds:
BB Baa 11,150 AMT, Series C, 6.75% due 11/15/2013 11,243
BB Baa 1,905 AMT, Series C, 6.75% due 11/15/2022 1,916
BB Baa 7,340 Series A, 7.25% due 11/15/2025 7,847
AAA NR* 1,075 El Paso County, Colorado, S/F Mortgage Revenue Bonds, AMT,
Series A, 8% due 9/01/2022 (d) 1,141
NR* A 1,335 Larimer County, Colorado, COP (Poudre School District No. R-1),
10% due 12/01/2000 1,668
AA+ MIG1++ 600 Northglenn, Colorado, IDR, Refunding (Castle Gardens), VRDN,
3.55% due 1/01/2009 (g) 600
<PAGE>
Connecticut--0.6% Connecticut State Development Authority, PCR, Refunding, VRDN,
Series A (g):
A1+ VMIG1++ 300 (Connecticut Light & Power Co. Project), 3.55% due 9/01/2028 300
A1+ VMIG1++ 700 (Western Massachusetts Electric Co.), 3.40% due 9/01/2028 700
A1 VMIG1++ 4,200 Connecticut State Economic Recovery Notes, VRDN, Series B, 3.55%
due 6/01/1996 (g) 4,200
Delaware--0.5% AAA Aaa 3,630 Delaware Transporation Authority, Transporation System, Senior
Revenue Bonds, 7% due 7/01/2014 (f) 4,043
District of A1+ VMIG1++ 400 District of Columbia, General Fund Recovery Revenue Bonds, VRDN,
Columbia--0.0% UT, Series B, 4.20% due 6/01/2003 (g) 400
Florida--1.5% NR* Aaa 10,180 Florida HFA, Home Ownership Revenue Bonds, AMT, Series G-1,
7.90% due 3/01/2022 (d) 10,942
NR* VMIG1++ 1,700 Palm Beach County, Florida, Water and Sewer Revenue Bonds, VRDN,
3.55% due 10/01/2011 (g) 1,700
A1+ VMIG1++ 300 Saint Lucie County, Florida, PCR, Refunding (Florida Power &
Light Co. Project), VRDN, 3.50% due 1/01/2026 (g) 300
Georgia--5.7% A A 5,000 Georgia Municipal Electric Authority, Power Revenue Refunding
Bonds, Series V, 6.60% due 1/01/2018 5,277
Georgia Municipal Electric Authority, Special Obligation
Revenue Bonds:
A+ A 12,940 (Fifth Crossover Series--Project One), 6.50% due 1/01/2017 13,512
A A 4,850 (Third Crossover Series), 6.60% due 1/01/2018 5,128
Georgia State, GO:
AA+ Aaa 8,900 Series F, 6.50% due 12/01/2006 10,095
AA+ Aaa 7,000 Series F, 6.50% due 12/01/2007 7,925
AA+ Aa 1,550 Georgia State HFA, S/F Mortgage Revenue Bonds, AMT, Sub-Series
A-2, 6.55% due 12/01/2027 1,565
A+ A3 4,785 Monroe County, Georgia, Development Authority, PCR, Refunding
(Oglethorpe Power), Series A, 6.80% due 1/01/2011 5,225
Hawaii--0.4% AAA NR* 3,500 Hawaii State Department of Budget and Finance, Special Purpose
Mortgage Revenue Bonds (Citizens Utility Company), AMT, Series
91-A, 6.66% due 11/01/2021 3,603
Idaho--0.6% NR* Aaa 5,000 Idaho Housing Agency, S/F Mortgage Revenue Bonds, AMT, Series
E-2, 6.90% due 1/01/2027 5,173
<PAGE>
Illinois--8.0% AA Aa 2,500 Chicago, Illinois, Metropolitan Water Reclamation District,
Greater Chicago Capital Improvement Bonds, 5.50% due 12/01/2012 2,445
AAA Aaa 3,000 Chicago, Illinois, Motor Fuel Tax Revenue Refunding Bonds,
5.375% due 1/01/2014 (h) 2,799
AAA Aaa 2,500 Cook County, Illinois, COP, UT (Community College--District
No. 508), 8.75% due 1/01/2004 (f) 3,142
Illinois Development Finance Authority, PCR, Refunding:
A1+ NR* 1,400 (Amoco Oil Project), VRDN, 3.50% due 11/01/2012 (g) 1,400
BBB Baa2 7,000 (Commonwealth Edison Company Project), 7.25% due 6/01/2011 7,389
Illinois Educational Facilities Authority Revenue Bonds:
BBB+ NR* 2,500 (Chicago Osteopathic Health System), 7.25% due 5/15/2022 2,554
A+ A1 2,000 Refunding (Loyola University), Series A, 7.125% due
7/01/2021 2,142
Illinois HDA Revenue Bonds (M/F Housing Program):
A+ A1 2,000 Refunding, Series A, 7.375% due 7/01/2017 2,182
A+ A1 7,000 Series 5, 6.75% due 9/01/2023 7,125
Illinois Health Facilities Authority Revenue Bonds:
NR* Baa1 2,650 (Holy Cross Hospital Project), 6.70% due 3/01/2014 2,611
A1+ VMIG1++ 100 (Northwest Community Hospital), VRDN, 3.55% due 7/01/2025 (g) 100
NR Baa1 2,205 (Ravenswood Hospital Medical Center), 6.85% due 6/01/2012 2,229
NR* Baa1 7,375 (Ravenswood Hospital Medical Center), 6.90% due 6/01/2022 7,356
</TABLE>
<TABLE>
SCHEDULE OF INVESTMENTS (continued) (in Thousands)
<CAPTION>
S&P Moody's Face Value
STATE Ratings Ratings Amount Issue (Note 1a)
<S> <S> <S> <C> <S> <C>
Illinois AAA A1 $ 7,650 Illinois State Sales Tax Revenue Bonds, Series P, 6.50% due
(concluded) ` 6/15/2022 $ 8,263
BBB NR* 2,500 Lansing, Illinois, Tax Increment Revenue Refunding Bonds
(Sales Tax--Landings Redevelopment), 7% due 12/01/2008 2,685
Regional Transportation Authority, Illinois, GO:
AAA Aaa 3,500 Series A, 7.20% due 11/01/2020 (h) 4,092
AAA Aaa 4,000 Series C, UT, 7.75% due 6/01/2020 (f) 4,956
AAA Aaa 2,500 Series C, UT, 7.10% due 6/01/2025 (f) 2,785
<PAGE>
Indiana--8.6% A NR* 5,250 Indiana Bond Bank Revenue Bonds (State Revolving Fund Program),
Series A, 6.75% due 2/01/2017 5,532
NR* Aaa 6,855 Indiana State HFA, S/F Mortgage Revenue Refunding Bonds, Series
A, 6.80% due 1/01/2017 7,088
AAA Aaa 4,250 Indiana State Office Building, Community Correctional
Facilities, Revenue Refunding Bonds, Series A, 5.50% due
7/01/2020 3,956
A A 5,000 Indiana Transportation Finance Authority, Airport Facilities,
Lease Revenue Bonds (United Air), Series A, 6.75% due
11/01/2011 5,225
A+ A1 7,195 Indiana Transportation Finance Authority, Highway Revenue
Bonds, Series A, 6.80% due 12/01/2016 8,019
Indianapolis, Indiana, Local Public Improvement Bond Bank
Revenue Bonds:
A+ NR* 15,335 Refunding, Series D, 6.75% due 2/01/2014 16,877
A+ NR* 18,350 Refunding, Series D, 6.75% due 2/01/2020 19,328
NR* A1 7,000 Series C, 6.70% due 1/01/2017 7,280
Iowa--0.5% NR* Aaa 3,970 Iowa Finance Authority, S/F Mortgage Revenue Bonds, AMT,
Series A, 7.90% due 11/01/2022 (d) 4,220
Kentucky--0.1% A1+ VMIG1++ 800 Daviess County, Kentucky, Solid Waste Disposal Facility
Revenue Bonds (Scott Paper Company Project), VRDN, AMT,
Series A, 3.65% due 12/01/2023 (g) 800
Louisiana--0.4% NR* Baa3 3,000 Lake Charles, Louisiana, Harbor and Terminal District, Port
Facilities Revenue Refunding Bonds (Trunkline Long Company
Project), 7.75% due 8/15/2022 3,344
Maryland--0.3% AAA Aaa 1,000 Maryland State and Local Facilities Loans, Third Series, UT,
5.25% due 10/15/2002 1,047
AA Aa 1,925 Maryland Water Quality Financing Administration, Revolving
Loan Fund, Revenue Refunding Bonds, Series A, 5.50% due
9/01/2012 1,883
<PAGE>
Massachusetts-- AAA Aaa 2,035 Boston, Massachusetts, Water and Sewer Commission Revenue
10.0% Bonds, Series A, 9.25% due 1/01/2011 (k) 2,772
Massachusetts Bay Transportation Authority Revenue Bonds
(Massachusetts General Transportation Systems), Series A:
A+ A1 16,000 7% due 3/01/2021 18,306
A+ A1 3,010 Refunding, UT, 7% due 3/01/2019 3,438
A+ A1 3,090 Massachusetts State Consolidated Loan Revenue Bonds,
Series B, 5.375% due 7/01/2007 3,118
Massachusetts State Health and Educational Facilities
Authority Revenue Bonds:
AAA Aaa 7,300 6.70% due 8/15/2021 (i) 7,628
BBB Baa1 2,300 (Sisters Providence Health System), Series A, 6.625% due
11/15/2022 2,201
Massachusetts State, HFA (Residential Development) (l):
AAA Aaa 3,375 Series A, 6.90% due 11/15/2024 3,518
AAA Aaa 2,360 Series D, Section 8, 6.875% due 11/15/2021 2,456
A A 39,630 Massachusetts State Water Resource Authority Revenue Bonds,
Series A, 6.50% due 7/15/2019 42,544
Michigan--6.9% AAA Aaa 4,000 Anchor Bay, Michigan, School District Revenue Bonds, UT,
5.25% due 5/01/2014 (f) 3,729
AAA Aaa 3,410 Big Rapids, Michigan, Public School District Revenue Bonds,
UT, 5.625% due 5/01/2020 (f) 3,280
AAA Aaa 1,000 Detroit, Michigan, Sewage Disposal Revenue Refunding Bonds,
Series A, 5.70% due 7/01/2013 (f) 975
BBB Baa1 11,800 Dickinson County, Michigan, Economic Development Corporation,
PCR, Refunding (Champion International Corporation Project),
5.85% due 10/01/2018 11,185
BBB NR* 4,385 LaPeer, Michigan, Economic Development Corporation, Limited
Obligation Revenue Bonds (LaPeer Health Services Project),
8.50% due 2/01/2000 (a) 5,116
AA- A1 2,600 Michigan Public Power Agency, Revenue Refunding Bonds (Belle
River Project), Series B, 5% due 1/01/2019 2,264
AA+ NR* 6,000 Michigan State HDA, S/F Mortgage Revenue Refunding Bonds,
AMT, Series D, 6.85% due 6/01/2026 6,184
Michigan State Hospital Finance Authority, Revenue Refunding
Bonds, Series A:
A A 3,250 (Detroit Medical Center), 6.25% due 8/15/2013 3,226
A A 7,930 (Detroit Medical Center), 6.50% due 8/15/2018 7,964
NR* A1 4,180 (McLaren Obligation Group), 5.375% due 10/15/2013 3,807
AA- A1 2,000 Michigan State University, Michigan, Revenue Refunding Bonds,
Series A, 5.50% due 8/15/2022 1,845
AAA Aaa 1,250 Oakland University, Michigan, General Revenue Bonds, 5.75%
due 5/15/2026 (c) 1,213
Royal Oak, Michigan, Hospital Finance Authority, Hospital
Revenue Refunding Bonds (Beaumont Properties, Inc.):
AA- Aa 2,500 Series E, 6.625% due 1/01/2019 2,589
AA Aa 1,500 Series G, 5.10% due 11/15/2005 1,456
AAA Aaa 2,500 Warren, Michigan, Consolidated School District Revenue
Refunding Bonds, UT, Series II, 5.25% due 5/01/2021 (f) 2,289
AAA Aaa 2,000 Wayne State University, Michigan, General Revenue Refunding
Bonds, 5.65% due 11/15/2015 (h) 1,953
<PAGE>
Minnesota--3.7% A1+ NR* 600 Hubbard County, Minnesota, Solid Waste Disposal Revenue Bonds
(Potlatch Corporation Project), VRDN, AMT, 3.70% due
8/01/2014 (g) 600
AA- A1 300 Minneapolis, Minnesota, Community Development Agency, PCR
(Collateral-Nothern System Power Co. Project), VRDN,
3.65% due 3/01/2011 (g) 300
Minnesota State, HFA, S/F Mortgage Revenue Bonds:
AA Aa 3,750 AMT, Series L, 6.70% due 7/01/2020 3,841
AA Aa 6,000 AMT, Series M, 6.70% due 7/01/2026 6,145
AA+ Aa 7,500 Series E, 6.80% due 7/01/2025 7,880
AA+ Aa 4,250 Series H, 6.70% due 1/01/2018 4,440
AA+ Aa 2,000 Series Q, 6.70% due 1/01/2017 2,092
BBB Baa1 5,700 Sartell, Minnesota, PCR, Refunding (Champion International
Corporation), 6.95% due 10/01/2012 5,992
Nebraska--0.3% AAA Aaa 2,465 Nebraska Investment Finance Authority, S/F Mortgage Revenue
Bonds, AMT, Series 1, 8.125% due 8/15/2038 (c) (d) 2,617
Nevada--1.8% AAA Aaa 5,000 Clark County, Nevada, School District Revenue Bonds, 6.75%
due 6/15/2015 (f) 5,356
AA Aa 2,500 Nevada State Colorado River Community Revenue Bonds, 6.50%
due 7/01/2014 2,626
AAA NR* 1,235 Nevada State Housing Division, Housing Revenue Bonds
(Multi-Unit), Issue B, AMT, 7.45% due 10/01/2017 (l) 1,335
Nevada State Housing Division Revenue Bonds (S/F Program),
AMT:
NR* Aa 2,580 Series A, 6.55% due 10/01/2012 2,609
AAA Aaa 3,245 Series E, 7% due 10/01/2019 3,380
</TABLE>
<TABLE>
SCHEDULE OF INVESTMENTS (continued) (in Thousands)
<CAPTION>
S&P Moody's Face Value
STATE Ratings Ratings Amount Issue (Note 1a)
<S> <S> <S> <C> <S> <C>
New Jersey--0.6% AA- A1 $ 1,925 New Jersey State Highway Authority, General Revenue Bonds
(Garden State Parkway), 5.90% due 1/01/2004 $ 2,057
AAA Aaa 3,000 New Jersey State Housing and Mortgage Finance Agency
Revenue Bonds (Home Buyer), AMT, Series M, 6.95% due
10/01/2022 (c) 3,171
<PAGE>
New York--9.3% New York City, New York, GO, UT:
BBB+ Baa1 2,000 Series A, 7.75% due 3/15/2004 2,201
BBB+ Baa1 4,500 Series B, 7% due 6/01/2016 4,646
BBB+ Baa1 1,500 Series B, Sub-Series B-1, 7% due 8/15/2016 1,566
BBB+ Baa1 4,000 Series B, Sub-Series B-1, 7.25% due 8/15/2019 4,266
BBB+ Baa1 5,000 Series D, 9.50% due 8/01/2002 6,058
BBB+ Baa1 6,290 Series F, 8.10% due 11/15/1999 6,985
BBB+ Baa1 1,610 Series I, 7.50% due 8/15/2002 1,735
BBB+ Baa1 5,450 Series I, 7.50% due 8/15/2005 5,870
New York City, New York, Municipal Water Finance Authority,
Water and Sewer System Revenue Bonds:
A- A 3,200 Series A, 6% due 6/15/2025 3,143
A- A 4,500 Series B, 5.50% due 6/15/2019 4,150
AAA VMIG1++ 1,200 VRDN, Series G, 3.35% due 6/15/2024 (f) (g) 1,200
New York State Local Government Assistance Corporation
Revenue Bonds:
A A 4,905 Refunding, Series B, 5.50% due 4/01/2021 4,556
A A 11,870 Refunding, Series C, 5.50% due 4/01/2018 11,071
A A 3,800 Series A, 5.375% due 4/01/2014 3,544
A A 13,000 Series C, 7% due 4/01/2010 14,336
A A 5,000 Series D, 5.375% due 4/01/2014 4,663
North Dakota A+ Aa 985 North Dakota State HFA, S/F Mortgage Revenue Bonds, Series C,
- --0.1% 8.75% due 1/01/2019 1,044
Ohio--4.0% AAA Aaa 1,950 Cleveland, Ohio, Water Works Revenue Refunding Bonds
(First Mortgage), Series F, 6.50% due 1/01/2011 (h) 2,069
AAA Aaa 1,740 Lakota, Ohio, Local School District Revenue Bonds, UT, 7%
due 12/01/2008 (h) 2,024
Ohio, HFA, S/F Mortgage Revenue Bonds, AMT (d):
AAA NR* 10,735 Series A, 7.65% due 3/01/2029 11,189
AAA Aaa 8,285 Series B, 6.903% due 3/24/2031 8,522
AAA NR* 5,380 Series C, 8.125% due 3/01/2020 5,770
AAA NR* 4,735 Series C, 7.85% due 9/01/2021 5,033
Pennsylvania A1+ VMIG1++ 1,700 Allegheny County, Pennsylvania, Municipalities Improvement
- --4.2% Authority, Hospital Revenue Bonds (Pooled Hospital Equipment
Leasing), VRDN, 3.50% due 9/01/1995 (c) (g) 1,700
A+ Aa3 5,000 Delaware County, Pennsylvania, IDA, Revenue Refunding Bonds
(Resource Recovery Project), Series A, 8.10% due 12/01/2013 5,249
Pennsylvania HFA, S/F Mortgage Revenue Bonds, AMT:
AA Aa 11,665 Series R, 8.125% due 10/01/2019 12,372
AA Aa 4,890 Series U, 7.80% due 10/01/2020 5,212
AAA Aaa 10,000 Pennsylvania State Higher Education Assistance Agency,
Student Loan Revenue Bonds, RIB, AMT, 9.49% due 9/03/2026
(h) (j) 10,912
A1+ VMIG1++ 100 Philadelphia, Pennsylvania, Hospitals and Higher Education
Facilities Authority, Hospital Revenue Bonds (Children's
Hospital of Philadelphia Project), VRDN, 3.25% due
3/01/2027 (g) 100
<PAGE>
Rhode Island AAA Aaa 6,000 Rhode Island Health and Education Building Corporation
- --1.4% Revenue Bonds (Rhode Island Hospital), 6.85% due
8/15/2021 (f) 6,338
AA+ A1 6,000 Rhode Island Housing and Mortgage Finance Corporation,
INFLOS, AMT, Series B, 9.911% due 4/01/2024 (j) 6,375
South Carolina-- A1+ VMIG1++ 1,500 Berkeley County, South Carolina, PCR, Refunding (Amoco
0.5% Chemical Co. Project), VRDN, 3.50% due 7/01/2012 (g) 1,500
AAA Aaa 2,045 Richland County, South Carolina, Hospital Facilities Revenue
Refunding Bonds (South Carolina Baptist Hospital), Series B,
10% due 8/01/2001 (h) 2,614
Texas--8.7% Austin, Texas, Utility System Revenue Bonds (Prior Lien) (a):
AAA Aaa 20,000 10% due 5/15/2000 (e) 24,616
AAA Aaa 5,450 10.75% due 5/15/2000 6,879
AAA Aaa 6,000 Series A, 9.50% due 5/15/2000 7,262
A1+ VMIG1++ 1,200 Brazos River Authority, Texas, PCR, Refunding (Utility
Electric Co.), VRDN, AMT, Series C, 4.35% due 6/01/2030 (g) 1,200
Copperas Cove, Texas, Independent School District Revenue
Bonds, UT (a) (b):
AAA Aaa 1,430 6.90% due 8/15/2011 1,644
AAA Aaa 1,610 6.90% due 8/15/2013 1,851
BBB Baa1 4,000 Gulf Coast, Texas, IDA, Revenue Refunding Bonds (Champion
International Corporation), 7.125% due 4/01/2010 4,240
AA Aa 2,400 Harris County, Texas, Certificates of Obligation, Tax and
Revenue Bonds, 10% due 10/01/2002 3,159
Harris County, Texas, Health Facilities Development
Corporation, Hospital Revenue Bonds, Series A:
A- A 3,500 (Memorial Hospital Systems Project), 6.60% due 6/01/2014 3,560
A- A 2,500 (Memorial Hospital Systems Project), 6.625% due 6/01/2024 2,545
AA Aa 5,290 (Saint Luke's Episcopal Hospital Project), 6.625%
due 2/15/2012 5,445
AA Aa 11,400 North Central, Texas, Health Facilities Development
Corporation Revenue Bonds (Baylor University Medical
Center), Series A, 6.85% due 5/15/2016 11,832
NR* VMIG1++ 400 Southwest Higher Education Authority Incorporated, Texas,
Revenue Refunding Bonds (Southern Methodist University),
Crossover Series, VRDN, 3.50% due 7/01/2015 (g) 400
<PAGE>
Virginia--3.0% Virginia State Housing Development Authority, Commonwealth
Mortgage Revenue Bonds:
AA+ Aa 2,950 Series G, Sub-Series G-2, AMT, 6.65% due 1/01/2019 2,994
AA+ Aa1 10,000 Series H, 6.85% due 7/01/2014 10,489
AA+ Aa1 4,400 Series J, Sub-Series J-2, 6.75% due 7/01/2017 4,562
Virginia State Public School Authority, Special Obligation
Bonds (Chesapeake School Financing), UT:
AA Aa 2,500 5.40% due 6/01/2005 2,602
AA Aa 5,000 5.40% due 6/01/2006 5,160
Washington--4.9% Washington State Housing Finance Commission, S/F Mortgage
Revenue Refunding Bonds (d):
AAA NR* 8,805 Series A, 7.70% due 7/01/2016 9,473
AAA NR* 2,395 Series D, 6.95% due 7/01/2017 (l) 2,505
Washington State Public Power Supply System, Revenue
Refunding Bonds (Nuclear Project No. 1):
AA Aa 3,000 Series A, 7% due 7/01/2008 3,308
AA Aa 5,000 Series A, 6.875% due 7/01/2017 5,175
AA Aa 5,000 Series B, 7.25% due 7/01/2009 5,581
AA Aa 14,320 Series B, 7.125% due 7/01/2016 15,678
</TABLE>
<TABLE>
SCHEDULE OF INVESTMENTS (concluded) (in Thousands)
<CAPTION>
S&P Moody's Face Value
STATE Ratings Ratings Amount Issue (Note 1a)
<S> <S> <S> <C> <S> <C>
Wisconsin--0.9% NR* A $ 4,000 Wisconsin State Health and Educational Facilities
Authority, Revenue Refunding Bonds (Saint Claire Hospital
Project), 7% due 2/15/2011 $ 4,157
AA- A1 3,800 Wisconsin State Transportation Revenue Bonds, Series A,
5.50% due 7/01/2014 3,595
Wyoming--1.5% A1+ Aaa 2,300 Lincoln County, Wyoming, PCR (Exxon Project), VRDN, AMT,
Series C, 3.55% due 7/01/2017 (g) 2,300
BBB Baa3 7,475 Sweetwater County, Wyoming, Solid Waste Disposal Revenue
Bonds (FMC Corporation Project), AMT, Series B, 6.90% due
9/01/2024 7,625
AA Aa 2,500 Wyoming Community Development Authority, S/F Mortgage
Revenue Bonds, AMT, Series H, 7.10% due 6/01/2012 2,700
Total Investments (Cost--$825,325)--100.0% 855,945
Other Assets Less Liabilities--0.0% 266
--------
Net Assets--100.0% $856,211
========
<PAGE>
<FN>
(a)Prerefunded.
(b)PSF Guaranteed.
(c)MBIA Insured.
(d)GNMA Collateralized.
(e)BIGI Insured.
(f)FGIC Insured.
(g) The interest rate is subject to change periodically based upon
prevailing market rates. The interest rate shown is the rate in
effect at August 31, 1995.
(h)AMBAC Insured.
(i)FSA Insured.
(j)The interest rate is subject to change periodically and inversely
based upon prevailing market rates. The interest rate shown is the
rate in effect at August 31, 1995.
(k)Escrowed to maturity.
(l)FNMA Collateralized.
*Not Rated.
**Represents a zero coupon bond; the interest rate shown is the
effective yield at the time of purchase by the Fund.
++Highest short-term rating by Moody's Investors Service, Inc.
Ratings of issues shown have not been audited by Deloitte & Touche
LLP.
See Notes to Financial Statements.
</TABLE>
<TABLE>
STATEMENT OF ASSETS, LIABILITIES AND CAPITAL
<CAPTION>
As of August 31, 1995
<S> <S> <C> <C>
Assets: Investments, at value (identified cost--$825,325,201)(Note 1a) $855,945,096
Receivables:
Interest $ 13,318,006
Securities sold 6,546,592 19,864,598
------------
Prepaid expenses and other assets 18,982
------------
Total assets 875,828,676
------------
<PAGE>
Liabilities: Payables:
Securities purchased 13,512,196
Dividends to Common Stock shareholders (Note 1e) 878,543
Investment adviser (Note 2) 359,461 14,750,200
------------
Accrued expenses and other liabilities 4,867,727
------------
Total liabilities 19,617,927
------------
Net Assets: Net assets $856,210,749
============
Capital: Preferred Stock, par value $.10 per share; 10,000,000
shares authorized (11,000 shares of AMPS* issued and
outstanding, at $25,000 per share liquidation preference)
(Note 4) $275,000,000
Common Stock, par value $.10 per share; 150,000,000 shares
authorized; 61,123,140 shares issued and outstanding (Note 4) $ 6,112,314
Paid-in capital in excess of par 563,529,671
Undistributed investment income--net 6,623,527
Accumulated realized capital losses on investments--net (Note 5) (23,373,939)
Accumulated distributions in excess of realized capital
gains--net (2,300,719)
Unrealized appreciation on investments--net 30,619,895
------------
Total--Equivalent to $9.51 net asset value per share of Common
Stock (market price--$8.563) 581,210,749
------------
Total capital $856,210,749
============
<FN>
*Auction Market Preferred Stock.
See Notes to Financial Statements.
</TABLE>
<TABLE>
STATEMENT OF OPERATIONS
<CAPTION>
For the Year Ended August 31, 1995
<S> <S> <C> <C>
Investment Interest and amortization of premium and discount earned $ 54,973,899
Income (Note 1d):
<PAGE>
Expenses: Investment advisory fees (Note 2) $ 4,180,370
Commission fees (Note 4) 687,254
Transfer agent fees 201,450
Accounting services (Note 2) 132,355
Professional fees 93,257
Printing and shareholder reports 90,493
Custodian fees 58,655
Directors' fees and expenses 36,722
Pricing fees 23,752
Listing fees 14,500
Other 32,795
------------
Total expenses 5,551,603
------------
Investment income--net 49,422,296
------------
Realized & Realized loss on investments--net (23,373,939)
Unrealized Gain Change in unrealized appreciation on investments--net 29,954,817
(Loss) on ------------
Investments Net Increase in Net Assets Resulting from Operations $ 56,003,174
- --Net (Notes ============
1b, 1d & 3):
See Notes to Financial Statements.
</TABLE>
<TABLE>
STATEMENTS OF CHANGES IN NET ASSETS
<CAPTION>
For the Year Ended August 31,
Increase (Decrease) in Net Assets: 1995 1994
<S> <S> <C> <C>
Operations: Investment income--net $ 49,422,296 $ 51,160,280
Realized gain (loss) on investments--net (23,373,939) 18,031,016
Change in unrealized appreciation/depreciation on
investments--net 29,954,817 (65,699,451)
------------ ------------
Net increase in net assets resulting from operations 56,003,174 3,491,845
------------ ------------
Dividends & Investment income--net:
Distributions to Preferred Stock (10,565,338) (6,969,913)
Shareholders Common Stock (38,887,886) (42,880,970)
(Note 1e): Realized gain on investments--net, to Common Stock
shareholders (7,718,708) (19,681,289)
In excess of realized gain on investments--net, to Common
Stock Shareholders (2,300,719) --
------------ ------------
Net decrease in net assets resulting from dividends and
distributions to shareholders (59,472,651) (69,532,172)
------------ ------------
<PAGE>
Common Stock Net increase in net assets derived from shares issued to
Transactions Common Stock shareholders in reinvestment of dividends and
(Note 4): distributions -- 8,190,313
------------ ------------
Net Assets: Total decrease in net assets (3,469,477) (57,850,014)
Beginning of year 859,680,226 917,530,240
------------ ------------
End of year* $856,210,749 $859,680,226
============ ============
<FN>
*Undistributed investment income--net $ 6,623,527 $ 6,654,455
============ ============
See Notes to Financial Statements.
</TABLE>
<TABLE>
FINANCIAL HIGHLIGHTS
The following per share data and ratios have
been derived from information provided in
the financial statements.
For the Year Ended August 31,
Increase (Decrease) in Net Asset Value: 1995 1994 1993 1992 1991
<S> <S> <C> <C> <C> <C> <C>
Per Share Net asset value, beginning of year $ 9.57 $ 10.65 $ 10.19 $ 9.76 $ 9.28
Operating -------- -------- -------- -------- --------
Performance: Investment income--net .81 .84 .92 .97 .96
Realized and unrealized gain (loss) on
investments--net .10 (.78) .69 .58 .49
-------- -------- -------- -------- --------
Total from investment operations .91 .06 1.61 1.55 1.45
-------- -------- -------- -------- --------
Less dividends and distributions to
Common Stock shareholders:
Investment income--net (.64) (.70) (.78) (.79) (.73)
Realized gain on investments--net (.12) (.32) (.25) (.16) --
In excess of realized gain on investments--net (.04) -- -- -- --
-------- -------- -------- -------- --------
Total dividends and distributions to
Common Stock shareholders (.80) (1.02) (1.03) (.95) (.73)
-------- -------- -------- -------- --------
Effect of Preferred Stock Activity:
Dividends to Preferred Stock shareholders
from investment income--net (.17) (.12) (.12) (.17) (.24)
-------- -------- -------- -------- --------
Net asset value, end of year $ 9.51 $ 9.57 $ 10.65 $ 10.19 $ 9.76
======== ======== ======== ======== ========
Market price per share, end of year $ 8.563 $ 8.50 $ 11.25 $ 11.25 $ 10.25
======== ======== ======== ======== ========
<PAGE>
Total Based on market price per share 10.88% (16.29%) 10.39% 20.39% 18.02%
Investment ======== ======== ======== ======== ========
Return:* Based on net asset value per share 9.38% (0.44%) 15.38% 14.52% 13.53%
======== ======== ======== ======== ========
Ratios to Expenses .66% .64% .65% .65% .66%
Average ======== ======== ======== ======== ========
Net Assets:** Investment income--net 5.91% 5.76% 6.17% 6.58% 6.84%
======== ======== ======== ======== ========
Supplemental Net assets, net of Preferred Stock,
Data: end of year (in thousands) $581,211 $584,680 $642,530 $601,049 $593,867
======== ======== ======== ======== ========
Preferred Stock outstanding, end of year
(in thousands) $275,000 $275,000 $275,000 $275,000 $275,000
======== ======== ======== ======== ========
Portfolio turnover 71.95% 100.92% 73.38% 112.10% 129.73%
======== ======== ======== ======== ========
Dividends Per Series A--Investment income--net $ 922 $ 633 $ 633 $ 878 $ 1,251
Share on Series B--Investment income--net 946 637 642 882 1,243
Preferred Stock Series C--Investment income--net 947 644 624 861 1,237
Outstanding:++ Series D--Investment income--net 1,014 633 644 915 1,290
Series E--Investment income--net 968 626 636 884 1,261
<FN>
*Total investment returns based on market value, which can be
significantly greater or lesser than the net asset value, may result
in substantially different returns. Total investment returns exclude
the effect of sales loads.
**Do not reflect the effect of dividends to Preferred Stock
shareholders.
++Dividends per share have been adjusted to reflect a four-for-one
stock split.
See Notes to Financial Statements.
</TABLE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS
1. Significant Accounting Policies:
MuniVest Fund, Inc. (the "Fund") is registered under the Investment
Company Act of 1940 as a non-diversified, closed-end management
investment company. The Fund determines and makes available for
publication the net asset value of its Common Stock on a weekly
basis. The Fund's Common Stock is listed on the American Stock
Exchange under the symbol MVF. The following is a summary of
significant accounting policies followed by the Fund.
(a) Valuation of investments--Municipal bonds are traded primarily
in the over-the-counter markets and are valued at the most recent
bid price or yield equivalent as obtained by the Fund's pricing
service from dealers that make markets in such securities. Financial
futures contracts, which are traded on exchanges, are valued at
their closing prices as of the close of such exchanges. Options,
which are traded on exchanges, are valued at their last sale price
as of the close of such exchanges or, lacking any sales, at the last
available bid price. Securities with remaining maturities of sixty
days or less are valued at amortized cost, which approximates market
value. Securities and assets for which market quotations are not
readily available are valued at fair value as determined in good
faith by or under the direction of the Board of Directors of the
Fund, including valuations furnished by a pricing service retained
by the Fund, which may utilize a matrix system for valuations. The
procedures of the pricing service and its valuations are reviewed by
the officers of the Fund under the general supervision of the
Directors.
(b) Derivative financial instruments--The Fund may engage in various
portfolio strategies to seek to increase its return by hedging its
portfolio against adverse movements in the debt markets. Losses may
arise due to changes in the value of the contract or if the
counterparty does not perform under the contract.
* Financial futures contracts--The Fund may purchase or sell
interest rate futures contracts and options on such futures
contracts for the purpose of hedging the market risk on existing
securities or the intended purchase of securities. Futures contracts
are contracts for delayed delivery of securities at a specific
future date and at a specific price or yield. Upon entering into a
contract, the Fund deposits and maintains as collateral such initial
margin as required by the exchange on which the transaction is
effected. 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.
<PAGE>
* Options--The Fund is authorized to write covered call options and
purchase put options. When the Fund writes an option, an amount
equal to the premium received by the Fund is reflected as an asset
and an equivalent liability. The amount of the liability is
subsequently marked to market to reflect the current market value of
the option written.
When a security is purchased or sold through an exercise of an
option, the related premium paid (or received) is added to (or
deducted from) the basis of the security acquired or deducted from
(or added to) the proceeds of the security sold. When an option
expires (or the Fund enters into a closing transaction), the Fund
realizes a gain or loss on the option to the extent of the premiums
received or paid (or gain or loss to the extent the cost of the
closing transaction exceeds the premium paid or received).
Written and purchased options are non-income producing investments.
(c) Income taxes--It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute substantially all of its
taxable income to its shareholders. Therefore, no Federal income tax
provision is required.
(d) Security transactions and investment income--Security
transactions are recorded on the dates the transactions are entered
into (the trade dates). Interest income is recognized on the accrual
basis. Discounts and market premiums are amortized into interest
income. Realized gains and losses on security transactions are
determined on the identified cost basis.
(e) Dividends and distributions--Dividends from net investment
income are declared and paid monthly. Distributions of capital gains
are recorded on the ex-dividend dates. Distributions in excess of
realized capital gains are due primarily to differing tax treatments
for futures transactions and post-October losses.
2. Investment Advisory Agreement and Transactions
with Affiliates:
The Fund has entered into an Investment Advisory Agreement with Fund
Asset Management, L.P. ("FAM"). The general partner of FAM is
Princeton Services, Inc. ("PSI"), an indirect wholly-owned
subsidiary of Merrill Lynch & Co., Inc. ("ML & Co."), which is the
limited partner.
<PAGE>
FAM is responsible for the management of the Fund's portfolio and
provides the necessary personnel, facilities, equipment and certain
other services necessary to the operations of the Fund. For such
services, the Fund pays a monthly fee at an annual rate of .50% of
the Fund's average weekly net assets.
Accounting services are provided to the Fund by FAM at cost.
Certain officers and/or directors of the Fund are officers and/or
directors of FAM, PSI, Merrill Lynch, Pierce, Fenner & Smith Inc.
("MLPF&S"), and/or ML & Co.
3. Investments:
Purchases and sales of investments, excluding short-term securities,
for the year ended August 31, 1995 were $610,018,122 and
$567,821,508, respectively.
Net realized and unrealized gains (losses) as of August 31, 1995
were as follows:
Realized Unrealized
Losses Gains
Long-term investments $(14,267,018) $30,619,895
Short-term investments (30,182) --
Financial futures contracts (9,076,739) --
------------ -----------
Total $(23,373,939) $30,619,895
============ ===========
As of August 31, 1995, net unrealized appreciation for Federal
income tax purposes aggregated $30,539,918, of which $32,323,423
related to appreciated securities and $1,783,505 related to
depreciated securities. The aggregate cost of investments at August
31, 1995 for Federal income tax purposes was $825,405,178.
4. Capital Stock Transactions:
Common Stock
At August 31, 1995, the Fund had one class of shares of Common
Stock, par value $.10 per share, of which 150,000,000 shares were
authorized. For the year ended August 31, 1995 shares issued and
outstanding remained constant at 61,123,140. At August 31, 1995,
total paid-in capital amounted to $569,641,985.
<PAGE>
Preferred Stock
The Auction Market Preferred Stock ("AMPS") are shares of Preferred
Stock of the Fund that entitle their holders to receive cash
dividends at an annual rate that may vary for the successive
dividend periods for each series. The Fund is authorized to issue
10,000,000 shares or Preferred Stock having a par value of $.10
per share. The yields in effect at August 31, 1995 were as follows:
Series A, 3.728%; Series B, 3.720%; Series C, 3.760%; Series D,
3.476%; and Series E, 3.700%.
A four-for-one stock split occurred on December 1, 1994. As a
result, at August 31, 1995, there were 11,000 AMPS shares issued and
outstanding with a liquidation preference of $25,000 per share, plus
accumulated and unpaid dividends of $117,631. Prior to the stock
split, there were 2,750 AMPS shares outstanding with a liquidation
preference of $100,000.
The Fund pays commissions to certain broker-dealers at the end of
each auction at an annual rate of approximately one-quarter of 1%
calculated on the proceeds of each auction. For the year ended
August 31, 1995, MLPF&S, an affiliate of FAM, received $420,101 as
commissions.
5. Capital Loss Carryforward:
At August 31, 1995, the Fund had a net capital loss carryforward of
approximately $5,673,000, all of which expires in 2003. This amount
will be available to offset like amounts of any future taxable
gains.
6. Subsequent Event:
On September 11, 1995, the Fund's Board of Directors declared an
ordinary income dividend to Common Stock shareholders in the amount
of $0.051628 per share, payable on September 28, 1995 to
shareholders of record as of September 22, 1995.
<AUDIT-REPORT>
INDEPENDENT AUDITORS' REPORT
The Board of Directors and Shareholders,
MuniVest Fund, Inc.
We have audited the accompanying statement of assets, liabilities
and capital, including the schedule of investments, of MuniVest
Fund, Inc. as of August 31, 1995, the related statements of
operations for the year then ended and changes in net assets for
each of the years in the two-year period then ended, and the
financial highlights for each of the years in the five-year period
then ended. These financial statements and the financial highlights
are the responsibility of the Fund's management. Our responsibility
is to express an opinion on these financial statements and the
financial highlights based on our audits.
<PAGE>
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 the 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 at August
31, 1995 by correspondence with the custodian and brokers. 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, such financial statements and financial highlights
present fairly, in all material respects, the financial position of
MuniVest Fund, Inc. as of August 31, 1995, the results of its
operations, the changes in its net assets, and the financial
highlights for the respective stated periods in conformity with
generally accepted accounting principles.
Deloitte & Touche LLP
Princeton, New Jersey
September 29, 1995
</AUDIT-REPORT>
IMPORTANT TAX INFORMATION (unaudited)
All of the net investment income distributions paid monthly by
MuniVest Fund, Inc. during its taxable year ended August 31, 1995
qualify as tax-exempt interest dividends for Federal income tax
purposes. Additionally, the Fund distributed long-term capital gains
of $0.163922 per share to shareholders of record on December 19,
1994.
Please retain this information for your records.
<PAGE>
PER SHARE INFORMATION (unaudited)
<TABLE>
Per Share
Selected Quarterly
Financial Data*
<CAPTION>
Net Realized Unrealized Dividends / Distributions
Investment Gains Gains Net Investment Income Capital Gains
For the Quarter Income (Losses) (Losses) Common Preferred Common Preferred
<S> <C> <C> <C> <C> <C> <C> <C>
September 1, 1993 to November 30, 1993 $.22 $ .17 $(.30) $.19 $.03 -- --
December 1, 1993 to February 28, 1994 .21 .05 (.12) .17 .02 $.32 --
March 1, 1994 to May 31, 1994 .21 .13 (.69) .17 .03 -- --
June 1, 1994 to August 31, 1994 .20 (.05) .03 .17 .04 -- --
September 1, 1994 to November 30, 1994 .21 (.28) (.77) .17 .04 -- --
December 1, 1994 to February 28, 1995 .20 (.09) 1.04 .16 .04 .16 --
March 1, 1995 to May 31, 1995 .20 (.04) .34 .15 .04 -- --
June 1, 1995 to August 31, 1995 .20 .02 (.12) .16 .05 -- --
<CAPTION>
Net Asset Value Market Price**
For the Quarter High Low High Low Volume***
<S> <C> <C> <C> <C> <C>
September 1, 1993 to November 30, 1993 $10.86 $10.44 $11.25 $10.25 2,454
December 1, 1993 to February 28, 1994 10.76 10.11 10.75 9.375 2,851
March 1, 1994 to May 31, 1994 10.05 9.18 9.875 8.875 3,341
June 1, 1994 to August 31, 1994 9.83 9.35 9.625 8.25 3,361
September 1, 1994 to November 30, 1994 9.57 8.32 8.375 7.125 7,824
December 1, 1994 to February 28, 1995 9.31 8.49 8.75 7.50 6,243
March 1, 1995 to May 31, 1995 9.62 9.18 8.875 8.00 3,233
June 1, 1995 to August 31, 1995 9.77 9.29 8.6875 8.1875 3,485
<FN>
*Calculations are based upon shares of Common Stock outstanding at
the end of each quarter.
**As reported in the consolidated transaction reporting system.
***In thousands.
</TABLE>
