MUNIVEST
FUND, INC.
[GRAPHIC OMITTED]
STRATEGIC
Performance
Semi-Annual Report
February 28, 1999
<PAGE>
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.
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.
As a part of its investment strategy, the Fund may invest in certain securities
whose potential income return is inversely related to changes in a floating
interest rate ("inverse floaters"). In general, income on inverse floaters will
decrease when short-term interest rates increase and increase when short-term
interest rates decrease. Investments in inverse floaters may be characterized as
derivative securities and may subject the Fund to the risks of reduced or
eliminated interest payments and losses of invested principal. In addition,
inverse floaters have the effect of providing investment leverage and, as a
result, the market value of such securities will generally be more volatile than
that of fixed-rate, tax-exempt securities. To the extent the Fund invests in
inverse floaters, the market value of the Fund's portfolio and the net asset
value of the Fund's shares may also be more volatile than if the Fund did not
invest in these securities.
<PAGE>
MuniVest Fund, Inc., February 28, 1999
DEAR SHAREHOLDER
For the six months ended February 28, 1999, the Common Stock of MuniVest Fund,
Inc. earned $0.306 per share income dividends, which included earned and unpaid
dividends of $0.044. This represents a net annualized yield of 6.12%, based on a
month-end per share net asset value of $10.06. Over the same period, the total
investment return on the Fund's Common Stock was +1.99%, based on a change in
per share net asset value from $10.20 to $10.06, and assuming reinvestment of
$0.312 per share income dividends and $0.029 per share capital gains
distributions.
For the six months ended February 28, 1999, the Fund's Preferred Stock had an
average yield as follows: Series A, 3.37%; Series B, 3.57%; Series C, 3.09%;
Series D, 3.11%; and Series E, 3.25%.
The Municipal Market Environment
During most of the six months ended February 28, 1999, fixed-income investors
concentrated on the positive elements within the current economic framework. On
an annual basis, US economic growth remained modest, although it strengthened
somewhat in recent months. More important, continued weak foreign economic
growth has been seen as preventing US growth from overheating and generating
increased inflationary pressures. World commodity prices continued to decline to
their lowest level in over a decade, reinforcing the extremely positive
inflationary environment in the United States. Additionally, the Federal Reserve
Board lowered short-term interest rates in September, October and November.
These actions were taken both to ensure that US domestic economic growth would
not be negatively impacted by weak foreign demand and that US financial markets
would have adequate liquidity to offset deteriorating financial conditions in
Asia, Russia and Brazil. Despite considerable volatility, such positive factors
allowed long-term fixed-income interest rates to modestly decline into late
January 1999. During the six-month period ended February 28, 1999, US Treasury
bond yields declined almost 20 basis points (0.20%) to 5.09%, and long-term
tax-exempt revenue bond yields fell approximately 10 basis points to 5.17%, as
measured by the Bond Buyer Revenue Bond Index.
However, during February investors have developed a more negative bias toward
both the prospects for US economic growth and long-term bond yields. Economic
indicators released during February did not suggest that the US economy was
materially stronger in February than it had been in January or even in late
1998. Inflationary measures, such as the consumer price index and the gross
domestic product price deflator, have continued to suggest that domestic price
pressures are nearly non-existent. The consensus among economists was that
Federal Reserve Board Chairman Alan Greenspan's Humphrey-Hawkins testimony
emphasized that the balance between moderate economic growth and low inflation
seen in recent quarters remains in place and that it was unlikely that the
Federal Reserve Board would lower or raise short-term interest rates during
1999. However, investors largely chose to ignore these interpretations and began
to anticipate that the Federal Reserve Board was likely to raise short-term
interest rates sometime during 1999. Subsequently, fixed-income bond yields rose
for the remainder of the month. In February, US Treasury bond yields rose almost
50 basis points to 5.57%, and long-term uninsured municipal revenue bond yields
rose less than 15 basis points to end the month at 5.29%. During the February
quarter, US Treasury bond yields rose 30 basis points, while long-term municipal
bond yields rose less than 5 basis points, as measured by the Bond Buyer Revenue
Bond Index.
Throughout most of 1998, the municipal bond market's performance was impeded by
a significant increase in annual new-issue supply. However, in recent months,
the technical position of the tax-exempt market improved. This has led to the
outperformance by long-term municipal bonds seen thus far in 1999. Over the last
12 months, more than $275 billion in new long-term tax-exempt bonds was
underwritten, an increase of almost 16% compared to the same period a year ago.
As municipal bond yields declined in recent years, it has taken increasingly
lower bond yields to generate the cost savings necessary to refinance remaining
higher-couponed debt. Consequently, the rate of increases in municipal bond
issuance slowed dramatically in recent quarters. During the last six months,
over $120 billion in new tax-exempt bonds was issued, a decrease of
approximately 7% compared to the same period a year ago. During the quarter
ended February 28, 1999, less than $60 billion in new long-term municipal bonds
was underwritten, representing a decline of nearly 10% compared to the quarter
ended February 28, 1998.
The pace of tax-exempt issuance slowed further in 1999. Year-to-date issuance
was less than $33 billion, representing a decline of almost 25% compared to
January 1998's volume. Additionally, investors received over $40 billion in
coupon payments, maturities and proceeds from early redemptions in January and
February. Consequently, investor demand has been strong in recent months, easily
matching, if not at times exceeding, available supply. We will monitor this
situation closely in the coming months to determine if the supply pressures
exerted in 1998 are abating and fostering a more balanced supply/demand
environment for 1999. Such an environment should allow the tax-exempt market's
performance to more closely mirror that of its taxable counterpart.
Foreign investors have rarely been active investors in the tax-exempt bond
market since they are unable to benefit from the inherent tax advantage of
municipal securities. Consequently, the municipal bond market has not been able
to benefit from the strong "flight to quality" demand enjoyed by US Treasury
securities since late 1997. This inability has in large part resulted in
significantly smaller declines in municipal bond yields compared to US Treasury
securities. However, this has resulted in the opportunity to purchase tax-exempt
securities with yields very close to or, in some instances, exceeding those of
comparable US Treasury bonds. By February 28, 1999, long-term tax-exempt bond
yields were at 95% of US Treasury bond yields. Municipal bond yield ratios have
averaged approximately 92% for the last 12 months. During 1997, tax-exempt bond
yield ratios averaged 84%. It is likely that the combination of the annual
increase in new-issue volume and the "safe-haven" status of US Treasury
securities drove municipal bond yield ratios to their present attractive levels.
Should new volume decline and/or foreign financial markets regain stability in
1999, tax-exempt bond yield ratios could quickly return to their more historic
levels (85%-88%).
Looking ahead, the expected combination of moderate economic growth in the
United States and continued negligible inflation suggests a relatively stable
interest rate environment into early 1999. However, it is likely that foreign
financial markets will again be a critical factor in determining US bond yields.
While some Pacific Rim economies are expected to improve somewhat in 1999, the
economies of Japan and much of Europe are unlikely to show much growth in the
coming months. Also, economic problems in Russia and Brazil remain unresolved
suggesting that additional shocks to the world's financial system are possible.
On the other hand, the continued robustness of the US economy has led to some
back up in interest rates. However, at present these factors suggest that there
is little immediate risk of sustained significant increases in long-term bond
yields.
Portfolio Strategy
In recent months, we gradually adopted a more neutral position toward the
tax-exempt bond market and interest rates. Presently, this change is expected to
be a temporary measure, since our longer-term outlook for interest rates remains
positive. During 1999, we expect annual economic growth in the United States to
be similar to 1998, if not slightly below trend. Given the current low levels of
world commodity prices, we believe that any meaningful increase in inflation is
unlikely. Similar to 1998, we believe that this scenario suggests that
fixed-income bond yields are likely to reach their annual highs early in the
year and subsequently decline.
During the six-month period ended February 28, 1999, we reduced the Fund's
position of interest rate-sensitive issues and placed greater
2 & 3
<PAGE>
emphasis on securities that are expected to generate higher levels of tax-exempt
income. However, the Fund remains well positioned to participate in any bond
market improvement. We will closely monitor the impact foreign economies will
have on US exports, as well as the ability of the US equity market to sustain
current levels of valuation. Should foreign economic conditions weaken further,
and/or the US equity market roll back from its current level, we are likely to
return the Fund to a more aggressive structure. Until then, we will keep the
Fund fully invested in an effort to seek to enhance shareholder income through
the purchase of high-quality tax-exempt securities.
In Conclusion
We appreciate your ongoing interest in MuniVest Fund, Inc., and we look forward
to assisting you with your financial needs in the months and years ahead.
Sincerely,
/s/ Terry K. Glenn
Terry K. Glenn
President and Director
/s/ Vincent R. Giordano
Vincent R. Giordano
Senior Vice President
/s/ Fred K. Stuebe
Fred K. Stuebe
Vice President and Portfolio Manager
April 7, 1999
================================================================================
After more than 20 years of service, Arthur Zeikel recently retired as Chairman
of Merrill Lynch Asset Management, L.P. (MLAM). Mr. Zeikel served as President
of MLAM from 1977 to 1997 and as Chairman since December 1997. Mr. Zeikel is one
of the country's most respected leaders in asset management and presided over
the growth of Merrill Lynch's asset management business. During his tenure,
client assets under management grew from $300 million to over $500 billion. Mr.
Zeikel will remain on MuniVest Fund, Inc.'s Board of Directors. We are pleased
to announce that Terry K. Glenn has been elected President and Director of the
Fund. Mr. Glenn has held the position of Executive Vice President of MLAM since
1983.
Mr. Zeikel's colleagues at MLAM join the Fund's Board of Directors in wishing
him well in his retirement from Merrill Lynch and are pleased that he will
continue as a member of the Fund's Board of Directors.
================================================================================
Quality Profile
The quality ratings of securities in the Fund as of February 28, 1999 were as
follows:
- --------------------------------------------------------------------------------
Percent of
S&P Rating/Moody's Rating Net Assets
- --------------------------------------------------------------------------------
AAA/Aaa................................................................. 41.3%
AA/Aa .................................................................. 24.3
A/A..................................................................... 16.4
BBB/Baa................................................................. 8.6
NR (Not Rated).......................................................... 3.7
Other*.................................................................. 4.0
- --------------------------------------------------------------------------------
* Temporary investments in short-term municipal securities.
PROXY RESULTS
During the six-month period ended February 28, 1999, MuniVest Fund, Inc. Common
Stock shareholders voted on the following proposals. The proposals were approved
at a shareholders' meeting on September 24, 1998. The description of each
proposal and number of shares voted are as follows:
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------------
Shares Voted Shares Withheld
For From Voting
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. To elect the Fund's Directors: Cynthia A. Montgomery 58,886,197 937,046
Charles C. Reilly 58,865,863 957,380
Kevin A. Ryan 58,893,958 929,285
Arthur Zeikel 58,856,557 966,686
- ----------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Shares Voted Shares Voted Shares Voted
For Against Abstain
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
2. To ratify the selection of Deloitte & Touche LLP as the Fund's
independent auditors for the current fiscal year. 58,789,779 255,585 777,879
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
During the six-month period ended February 28, 1999, MuniVest Fund, Inc.
Preferred Stock (Series A, B, C, D and E) shareholders voted on the following
proposals. The proposals were approved at a shareholders' meeting on September
24, 1998. The description of each proposal and number of shares voted are as
follows:
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------------
Shares Voted Shares Withheld
For From Voting
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. To elect the Fund's Directors as follows: Series A: Ronald W. Forbes and Richard R. West 1,806 0
Series B: Ronald W. Forbes and Richard R. West 1,967 0
Series C: Ronald W. Forbes 1,481 0
Richard R. West 1,477 4
Series D: Ronald W. Forbes 1,617 4
Richard R. West 1,621 0
Series E: Ronald W. Forbes 2,748 0
Richard R. West 2,740 8
- ----------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Shares Voted Shares Voted Shares Voted
For Against Abstain
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
2. To ratify the selection of Deloitte & Touche LLP as the Fund's Series A 1,802 4 0
independent auditors for the current fiscal year as follows: Series B 1,967 0 0
Series C 1,481 0 0
Series D 1,581 0 39
Series E 2,746 0 2
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</TABLE>
4 & 5
<PAGE>
MuniVest Fund, Inc., February 28, 1999
SCHEDULE OF INVESTMENTS (in Thousands)
<TABLE>
<CAPTION>
S&P Moody's Face Value
STATE Ratings Ratings Amount Issue (Note 1a)
=========================================================================================================================
<S> <C> <C> <C> <C> <C>
Alabama--6.6% NR* Aaa $ 4,165 Alabama HFA, S/F Mortgage Revenue Bonds (Collateral
Home Mortgage), Series A-1, 5.20% due 4/01/2017
(b)(d) $ 4,221
AAA NR* 9,740 Alabama HFA, S/F Mortgage Revenue Refunding Bonds,
Series A, 7.60% due 10/01/2022 (d) 10,158
A1+ P1 7,900 Columbia, Alabama, IDB, PCR, Refunding (Alabama
Power Company Project), VRDN, Series E, 3.20% due
10/01/2022 (g) 7,900
BBB Baa1 8,750 Courtland, Alabama, IDB, IDR, Refunding (Champion
International Corporation), Series A, 7.20% due
12/01/2013 9,559
Courtland, Alabama, IDB, Solid Waste Disposal
Revenue Bonds (Champion International Corporation
Project), AMT:
BBB Baa1 5,000 7% due 6/01/2022 5,374
BBB Baa1 6,170 Series A, 6.375% due 3/01/2029 6,521
NR* Aaa 12,500 Jefferson County, Alabama, Sewer Revenue Bonds,
RITR, Series 7, 7.32% due 2/01/2027 (j) 13,040
A1 VMIG1+ 2,100 Mobile, Alabama, IDB, PCR, Refunding (Alabama Power
Company Project), VRDN, 3.25% due 6/01/2015 (g) 2,100
=========================================================================================================================
Alaska--1.3% North Slope Boro, Alaska, GO, Series B (c):
AAA Aaa 6,000 5.10%** due 1/01/2002 5,380
AAA Aaa 6,000 5.20%** due 1/01/2003 5,154
A1+ VMIG1+ 1,000 Valdez, Alaska, Marine Terminal Revenue Refunding
Bonds (Exxon Pipeline Company Project), VRDN, Series
C, 3.15% due 12/01/2033 (g) 1,000
=========================================================================================================================
Colorado--3.3% NR* Aaa 5,000 Arapahoe County, Colorado, Capital Improvement Trust
Fund, Highway Revenue Bonds (SR-E-470 Project), 7%
due 8/31/2005 (a) 5,994
Denver, Colorado, City and County Airport Revenue
Bonds:
BBB+ Aaa 1,720 AMT, Series C, 6.75% due 11/15/2002 (a) 1,932
BBB+ Baa1 9,850 AMT, Series C, 6.75% due 11/15/2013 10,682
BBB+ Baa1 1,485 AMT, Series C, 6.75% due 11/15/2022 1,608
AAA Baa1 7,340 Series A, 7.25% due 11/15/2002 (a) 8,376
AAA NR* 525 El Paso County, Colorado, Local S/F Mortgage Revenue
Bonds, AMT, Series A, 8% due 9/01/2022 (d)(k) 549
=========================================================================================================================
Delaware--0.5% AAA Aaa 3,630 Delaware Transportation Authority, Transportation
System Revenue Bonds (Senior), 7% due 7/01/2004
(a)(f) 4,245
=========================================================================================================================
Florida--0.9% NR* Aaa 6,370 Florida HFA, Home Ownership Revenue Refunding Bonds,
AMT, Series G-1, 7.90% due 3/01/2022 (d) 6,721
A1+ VMIG1+ 1,300 Manatee County, Florida, PCR, Refunding (Florida
Power and Light Company Project), VRDN, 3.20% due
9/01/2024 (g) 1,300
A1+ VMIG1+ 100 Saint Lucie County, Florida, PCR, Refunding (Florida
Power and Light Company Project), VRDN, 3.20% due
1/01/2026 (g) 100
=========================================================================================================================
Georgia--5.9% Georgia Municipal Electric Authority, Power Revenue
Refunding Bonds:
A A3 4,850 Series W, 6.60% due 1/01/2018 5,737
A A3 12,940 Series Y, 6.50% due 1/01/2017 15,097
Georgia State, GO:
AAA Aaa 5,000 Series B, 5.75% due 7/01/2005 5,524
AAA Aaa 5,000 Series C, 5.75% due 9/01/2007 5,595
AAA Aaa 6,400 Series F, 6.50% due 12/01/2006 7,449
AAA Aaa 5,000 Series F, 6.50% due 12/01/2007 5,868
AAA Aa2 1,550 Georgia State Housing and Finance Authority, Revenue
Refunding Bonds, S/F Mortgage, AMT, Sub-Series A-2,
6.55% due 12/01/2027 (k) 1,648
A A3 4,785 Monroe County, Georgia, Development Authority, PCR,
Refunding (Oglethorpe Power Corporation Scherer),
Series A, 6.80% due 1/01/2011 5,711
=========================================================================================================================
Hawaii--3.7% AA- NR* 3,500 Hawaii State Department of Budget and Finance,
Special Purpose Mortgage Revenue Bonds, AMT, RIB,
6.66% due 11/01/2021 (j) 3,767
A A 10,000 Hawaii State Department of Budget and Finance,
Special Purpose Revenue Bonds, 6.25% due 7/01/2021 10,873
AAA Aaa 20,500 Honolulu, Hawaii, City and County, Wastewater System
Revenue Refunding Bonds, Junior Series, 4.50% due
7/01/2028 (f) 18,724
=========================================================================================================================
Idaho--0.5% NR* Aaa 4,420 Idaho Housing Agency, S/F Mortgage Revenue Refunding
Bonds, AMT, Series E-2, 6.90% due 1/01/2027 4,733
=========================================================================================================================
Illinois--9.5% AAA Aaa 12,000 Chicago, Illinois, GO, Refunding Bonds (Project and
Refunding), 5.25% due 1/01/2028 (f) 12,122
Chicago, Illinois, Sales Tax Revenue Bonds, RITR (j):
NR* Aaa 6,950 Series 24, 7.32% due 1/01/2027 7,252
AAA NR* 4,175 Series 92, 7.375% due 1/01/2030 (f) 4,350
AAA Aaa 5,300 Cook County, Illinois, GO, Refunding, Series B,
5.375% due 11/15/2018 (c) 5,397
Illinois Educational Facilities Authority, Revenue
Refunding Bonds (a):
NR* NR* 2,500 (Chicago Osteopathic Health System), 7.25% due
11/15/2019 3,166
NR* A1 2,000 (Loyola University--Chicago), Series A, 7.125% due
7/01/2001 2,199
Illinois HDA, Revenue Refunding Bonds:
A+ A1 660 (M/F Housing), Series A, 7.375% due 7/01/2017 720
A+ A1 7,000 (M/F Program), Series 5, 6.75% due 9/01/2023 7,609
Illinois Health Facilities Authority Revenue Bonds:
NR* Baa1 2,650 (Holy Cross Hospital Project), 6.70% due 3/01/2014 2,862
A1+ VMIG1+ 500 (Northwestern Memorial Hospital), VRDN, 3.25% due
8/15/2025 (g) 500
NR* NR* 2,205 (Ravenswood Hospital Medical Center), 6.85% due
6/01/2002 (a) 2,446
NR* NR* 7,375 (Ravenswood Hospital Medical Center), 6.90% due
6/01/2002 (a) 8,193
Illinois Health Facilities Authority, Revenue
Refunding Bonds:
AA A1 9,000 (Advocate Health Care), Series A, 5.875% due
8/15/2022 9,605
NR* VMIG1+ 700 (Resurrection Health Care System), VRDN, 3.25% due
5/01/2011 (g) 700
Illinois Regional Transportation Authority Revenue
Bonds:
AAA Aaa 3,500 Series A, 7.20% due 11/01/2020 (h) 4,484
AAA Aaa 4,000 Series C, 7.75% due 6/01/2020 (f) 5,436
AAA Aaa 2,500 Series C, 7.10% due 6/01/2025 (f) 2,874
A1+ P1 1,900 Joliet, Illinois, Regional Port District, Marine
Terminal Revenue Refunding Bonds (Exxon Project),
VRDN, 3.15% due 10/01/2024 (g) 1,900
NR* NR* 2,500 Lansing, Illinois, Tax Increment Revenue Refunding
Bonds (Sales Tax--Landings Redevelopment), 7% due
12/01/2008 2,751
=========================================================================================================================
</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.
ACES(SM) Adjustable Convertible Extendable Securities
AMT Alternative Minimum Tax (subject to)
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
RIB Residual Interest Bonds
RITR Residual Interest Trust Receipts
S/F Single-Family
VRDN Variable Rate Demand Notes
6 & 7
<PAGE>
MuniVest Fund, Inc., February 28, 1999
SCHEDULE OF INVESTMENTS (continued) (in Thousands)
<TABLE>
<CAPTION>
S&P Moody's Face Value
STATE Ratings Ratings Amount Issue (Note 1a)
=========================================================================================================================
<S> <C> <C> <C> <C> <C>
Indiana--8.8% AAA NR* $ 5,250 Indiana Bond Bank Revenue Bonds (State Revolving
Fund Program), Series A, 6.75% due 2/01/2017 $ 5,957
Indiana Health Facility Financing Authority,
Hospital Revenue Refunding Bonds:
AA Aa3 10,250 (Clarian Health Partners Inc.), Series A, 6% due
2/15/2021 11,097
BBB+ NR* 3,000 (Hancock Memorial Hospital Health Services),
6.125% due 8/15/2017 3,178
NR* Aaa 5,290 Indiana State, HFA, S/F Mortgage Revenue Refunding
Bonds, Series A, 6.80% due 1/01/2017 5,587
AA- Aa3 7,195 Indiana Transportation Finance Authority, Highway
Revenue Bonds, Series A, 6.80% due 12/01/2016 8,784
Indianapolis, Indiana, Local Public Improvement Bond
Bank Revenue Bonds, Series D:
AA NR* 15,335 6.75% due 2/01/2014 18,492
AA NR* 20,350 6.75% due 2/01/2020 22,401
A1 VMIG1+ 800 Jasper County, Indiana, PCR, Refunding (Northern
Indiana Public Service), VRDN, Series C, 3.20% due
4/01/2019 (g) 800
AA Aa2 2,000 Purdue University, Indiana, University Revenue Bonds
(Student Fee), Series B, 6.70% due 1/01/2005 (a) 2,328
=========================================================================================================================
Iowa--0.3% NR* Aaa 2,400 Iowa Finance Authority, S/F Mortgage Revenue Bonds,
AMT, Series A, 7.90% due 11/01/2022 (d) 2,490
=========================================================================================================================
Louisiana--2.1% BBB+ A3 4,000 De Soto Parish, Louisiana, Environmental Improvement
Revenue Refunding Bonds (International Paper Co.
Project), AMT, Series B, 6.55% due 4/01/2019 4,341
AAA Aaa 1,800 East Baton Rouge Parish, Louisiana, PCR, Refunding
(Exxon Project), VRDN, 3.25% due 3/01/2022 (g) 1,800
NR* A3 3,000 Lake Charles, Louisiana, Harbor and Terminal
District, Port Facilities Revenue Refunding Bonds
(Trunkline Long Company Project), 7.75% due 8/15/2022 3,389
A+ A1 5,000 Louisiana Public Facilities Authority Revenue Bonds
(Tulane University), 6.625% due 11/15/2002 (a) 5,587
NR* VMIG1+ 3,500 Louisiana State Offshore Terminal Authority,
Deepwater Port Revenue Refunding Bonds (Loop Inc.),
ACES, 1st Stage, 3.20% due 9/01/2006 (c)(g) 3,500
=========================================================================================================================
Maryland--0.6% AAA Aaa 5,000 Maryland State, GO (State and Local Facilities Loan),
Second Series, 5% due 7/15/2005 5,320
=========================================================================================================================
Massachusetts--4.7% AAA Aaa 2,035 Boston, Massachusetts, Water and Sewer Commission
Revenue Bonds, 9.25% due 1/01/2011 (e) 2,892
AA- Aa3 3,010 Massachusetts Bay Transportation Authority Revenue
Refunding Bonds (Massachusetts General
Transportation System), Series A, 7% due 3/01/2019 3,735
A A1 30,000 Massachusetts State Water Resource Authority Revenue
Bonds, Series A, 6.50% due 7/15/2019 35,338
=========================================================================================================================
Michigan--3.3% AAA Aaa 2,500 Avondale, Michigan, School District, GO, Refunding,
4.75% due 5/01/2022 (h) 2,385
AAA Aaa 2,420 Eaton Rapids, Michigan, Public Schools, GO,
Refunding, 4.75% due 5/01/2025 (c) 2,295
AA Aa2 1,760 Michigan State Building Authority, Revenue Refunding
Bonds (Facilities Program), Series 1, 5% due
10/15/2006 1,862
AA+ NR* 7,740 Michigan State, HDA, Revenue Refunding Bonds, AMT,
Series D, 6.85% due 6/01/2026 (k) 8,185
Michigan State Hospital Finance Authority, Revenue
Refunding Bonds:
BBB Baa2 3,250 (Detroit Medical Center Obligation Group),
Series A, 6.25% due 8/15/2013 3,338
BBB Baa2 7,930 (Detroit Medical Center Obligation Group),
Series A, 6.50% due 8/15/2018 8,230
NR* A1 2,500 (McLaren Health Care Corp.), Series A, 5% due
6/01/2028 2,333
NR* VMIG1+ 100 (Mt. Clemens Hospital), VRDN, 2.95% due
8/15/2015 (g) 100
AAA Aaa 1,000 Richmond, Michigan, Community School District, GO,
5.60% due 5/01/2006 (a)(h) 1,097
=========================================================================================================================
Minnesota--2.1% AAA Aaa 5,820 Minnesota State, GO, Refunding (Refunding and
Various Purpose), 4% due 11/01/2002 5,905
Minnesota State, HFA, S/F Mortgage Revenue Bonds:
AA+ Aa2 3,315 AMT, Series L, 6.70% due 7/01/2020 3,528
AA+ Aa2 5,180 AMT, Series M, 6.70% due 7/01/2026 5,514
AA+ Aa2 3,805 Series H, 6.70% due 1/01/2018 4,075
=========================================================================================================================
Nevada--2.1% AAA Aaa 5,000 Clark County, Nevada, School District, GO, 6.75% due
12/15/2004 (a)(f) 5,790
A A2 5,000 Henderson, Nevada, Health Care Facilities Revenue
Bonds (Catholic Healthcare West), 5.375% due
7/01/2026 5,020
Nevada State Housing Division Revenue Bonds, AMT:
AAA Aa2 1,235 (Multi-Unit Housing), Issue B, 7.45% due
10/01/2017 (b) 1,375
NR* Aa2 2,200 (S/F Program-Mezzanine), Series A, 6.55% due
10/01/2012 (k) 2,357
AAA Aaa 3,060 Nevada State Housing Division, S/F Program, AMT,
Senior Series E, 7% due 10/01/2019 (k) 3,295
A1+ P1 700 Washoe County, Nevada, Water Facility Revenue Bonds
(Sierra Pacific Power Company Project), AMT, VRDN,
3.35% due 12/01/2020 (g) 700
=========================================================================================================================
New Jersey--1.0% AAA Aaa 7,000 New Jersey Healthcare Facilities Financing Authority,
Revenue Refunding Bonds (Saint Barnabas Health),
Series B, 5.25% due 7/01/2015 (c) 7,204
AAA Aaa 2,000 New Jersey State Housing and Mortgage Finance Agency
Revenue Bonds (Home Buyer), AMT, Series M, 6.95% due
10/01/2022 (c) 2,185
=========================================================================================================================
New York--16.7% Long Island Power Authority, New York, Electric
System Revenue Bonds (c):
AAA Aaa 12,345 Series A, 5.50% due 12/01/2029 12,765
A1+ VMIG1+ 2,900 VRDN, Sub-Series 7, 3.20% due 4/01/2025 (g) 2,900
AAA Aaa 5,000 Metropolitan Transportation Authority, New York,
Commuter Facilities, Revenue Refunding Bonds, Series
B, 4.75% due 7/01/2026 (f) 4,750
AAA Aaa 6,300 Metropolitan Transportation Authority, New York,
Dedicated Tax Fund Revenue Bonds, Series A, 4.75%
due 4/01/2028 (f) 5,976
New York City, New York, GO:
A- A3 3,750 Refunding, Series C, 5.875% due 2/01/2016 4,036
A- A3 5,000 Refunding, Series F, 5.875% due 8/01/2024 5,385
A- Aaa 4,000 Series B, 7.25% due 8/15/2004 (a) 4,704
A- A3 2,800 Series B, 5.875% due 8/15/2016 3,015
A- Aaa 960 Series D, 9.50% due 8/01/2001 (a) 1,108
A- A3 430 Series D, 6% due 2/15/2005 (a) 479
A- A3 1,720 Series D, 6% due 2/15/2020 1,843
New York City, New York, Municipal Water Finance
Authority, Water and Sewer System Revenue Bonds:
NR* Aaa 11,920 RITR, Series 10, 7.37% due 6/15/2026 (j) 12,583
AAA Aaa 10,000 Series A, 4.75% due 6/15/2031 (f) 9,433
A A1 6,000 Series B, 5.75% due 6/15/2026 6,456
New York City, New York, Municipal Water Finance
Authority, Water and Sewer System Revenue Refunding
Bonds:
A A1 5,750 Series A, 5.50% due 6/15/2023 5,888
A A1 12,000 Series B, 5.25% due 6/15/2029 12,069
AAA Aaa 6,250 Series D, 4.75% due 6/15/2025 (c) 5,943
AA Aa3 6,500 New York City, New York, Transitional Finance
Authority Revenue Bonds (Future Tax), Second Series
C, 4.75% due 5/01/2023 6,194
AAA Aaa 24,500 New York State Dormitory Authority, Lease Revenue
Bonds, Municipal Health Facilities Improvement
Program, Series 1, 4.75% due 1/15/2029 (i) 23,191
AAA Aaa 4,000 New York State Dormitory Authority Revenue Bonds
(Mental Health Services Facilities Improvement),
Series G, 4.50% due 8/15/2018 3,739
</TABLE>
8 & 9
<PAGE>
MuniVest Fund, Inc., February 28, 1999
SCHEDULE OF INVESTMENTS (continued) (in Thousands)
<TABLE>
<CAPTION>
S&P Moody's Face Value
STATE Ratings Ratings Amount Issue (Note 1a)
=========================================================================================================================
<S> <C> <C> <C> <C> <C>
New York NR* NR* $ 9,000 New York State Energy Research and Development
(concluded) Authority, Gas Facilities Revenue Bonds, RITR,
Series 9, 7.62% due 1/01/2021 (c)(j) $ 9,857
AA- A1 2,750 Port Authority of New York and New Jersey,
Consolidated Revenue Refunding Bonds, 76th Series,
AMT, 6.50% due 11/01/2026 2,922
A1+ VMIG1+ 1,600 Port Authority of New York and New Jersey, Special
Obligation Revenue Refunding Bonds (Versatile
Structure Obligation), VRDN, AMT, Series 1R, 3.35%
due 8/01/2028 (g) 1,600
AAA Aaa 1,750 Westchester County, New York, GO, Refunding, Series
B, 4% due 11/15/2003 1,775
=========================================================================================================================
North Carolina--2.8% AA Aa3 12,250 North Carolina Medical Care Commission, Health Care
Facilities Revenue Refunding Bonds (Duke University
Health System), Series A, 4.75% due 6/01/2028 11,407
NR* VMIG1+ 4,750 North Carolina Medical Care Commission, Hospital
Revenue Bonds (Pooled Financing Project), ACES,
Series A, 3.20% due 10/01/2020 (g) 4,750
AAA Aaa 6,800 North Carolina Medical Care Commission, Hospital
Revenue Refunding Bonds (Pitt County Memorial
Hospital), Series A, 4.75% due 12/01/2028 (c) 6,417
AAA Aaa 2,900 University of North Carolina, System Pool Revenue
Bonds, Series B, 4.50% due 10/01/2018 (c) 2,727
=========================================================================================================================
Ohio--0.7% AAA Aaa 2,925 Ohio HFA, S/F Mortgage Revenue Bonds, AMT, RIB,
Series B, 10.226% due 3/31/2031 (d)(j) 3,250
AAA Aa1 3,000 Ohio State, GO (Highway Capital Improvements),
Series B, 5% due 5/01/2007 3,190
=========================================================================================================================
Pennsylvania--1.4% AA+ Aa2 320 Pennsylvania HFA, S/F Mortgage Revenue Bonds, AMT,
Series U, 7.80% due 10/01/2020 321
AAA Aaa 10,000 Pennsylvania State Higher Educational Assistance
Agency, Student Loan Revenue Bonds, AMT, RIB,
10.128% due 9/03/2026 (h)(j) 11,838
=========================================================================================================================
Rhode Island--0.8% AA+ Aa2 6,000 Rhode Island Housing and Mortgage Finance
Corporation, Revenue Refunding Bonds, INFLOS,
AMT, 10.833% due 4/01/2024 (j) 6,728
=========================================================================================================================
South Carolina--1.1% AAA A1 5,000 Charleston, South Carolina, Waterworks and Sewer
Revenue Refunding Bonds (Refunding and Capital
Improvement), 4.50% due 1/01/2024 4,613
AAA Aaa 5,000 South Carolina State Public Service Authority,
Revenue Refunding Bonds, Series A, 5.75% due
1/01/2022 (c) 5,335
=========================================================================================================================
Tennessee--1.0% AAA Aaa 9,000 Metropolitan Government Nashville and Davidson
County, Tennessee, Water and Sewer Revenue
Refunding Bonds, Series A, 4.75% due 1/01/2022 (f) 8,624
=========================================================================================================================
Texas--7.7% Copperas Cove, Texas, Independent School District,
GO (a):
AAA Aaa 1,430 6.90% due 8/15/2004 1,645
AAA Aaa 1,610 6.90% due 8/15/2004 1,852
AA- Aa3 6,250 Guadalupe-Blanco River Authority, Texas, Sewage and
Solid Waste Disposal Facility Revenue Bonds (E.I. du
Pont de Nemours and Company Project), AMT, 6.40% due
4/01/2026 6,887
BBB Baa1 4,000 Gulf Coast, Texas, IDA (Champion International
Corp.), 7.125% due 4/01/2010 4,336
A1+ VMIG1+ 1,900 Gulf Coast Waste Disposal Authority, Texas, PCR,
Refunding (Amoco Oil Company Project), VRDN, 3.15%
due 10/01/2017 (g) 1,900
AA Aa2 2,400 Harris County, Texas, GO (Certificates of
Obligation), 10% due 10/01/2002 (e) 2,894
Harris County, Texas, Health Facilities Development
Corporation, Hospital Revenue Bonds:
AAA Aaa 1,485 (Hermann Hospital Project), 6.375% due 10/01/2004
(a) 1,683
NR* NR* 3,500 (Memorial Hospital System Project), Series A,
6.60% due 6/01/2004 (a) 3,990
NR* NR* 2,500 (Memorial Hospital System Project), Series A,
6.625% due 6/01/2004 (a) 2,853
AAA Aa3 5,290 (Saint Luke's Episcopal Hospital Project), 6.625%
due 2/15/2012 (e) 5,684
A1+ NR* 1,900 Harris County, Texas, Health Facilities Development
Corporation, Hospital Revenue Refunding Bonds
(Methodist Hospital), VRDN, 3.25% due 12/01/2025 (g) 1,900
NR* Aa3 10,385 Harris County, Texas, Health Facilities Development
Corporation Revenue Bonds, RITR, Series 6, 7.995%
due 12/01/2027 (j) 11,508
AA Aa3 5,500 Harris County, Texas, Health Facilities Development
Corporation, Revenue Refunding Bonds (School Health
Care System), Series B, 6.25% due 7/01/2027 6,415
NR* Aaa 6,000 Houston, Texas, Water and Sewer System Revenue Bonds,
RITR, Series 5, 7.32% due 12/01/2027 (f)(j) 6,293
AA Aa2 5,000 Lower Neches Valley Authority, Texas, Industrial
Development Corporation, Sewer Facilities Revenue
Bonds (Mobil Oil Refining Corp. Project), AMT, 6.40%
due 3/01/2030 5,467
BBB- Baa2 3,250 Texas Gulf Coast Waste Disposal Authority, Revenue
Refunding Bonds (USX Corporation Projects), 5.50%
due 9/01/2017 3,216
=========================================================================================================================
Virginia--3.0% AAA Aaa 5,000 Chesterfield County, Virginia, GO, Refunding Bonds,
4% due 1/01/2005 5,041
BBB- Baa3 10,000 Pocahontas Parkway Association, Virginia, Toll Road
Revenue Bonds, Senior Series A, 5.50% due 8/15/2028 9,899
AA+ Aa1 1,930 University of Virginia, University Revenue Bonds,
Series A, 5% due 6/01/2006 2,045
AA+ Aa1 4,400 Virginia State, HDA, Commonwealth Mortgage Revenue
Bonds, Series J, Sub-Series J-2, 6.75% due 7/01/2017 4,714
AA+ Aa1 2,950 Virginia State, HDA, Commonwealth Mortgage Revenue
Refunding Bonds, AMT, Series G, Sub-Series G-2,
6.65% due 1/01/2019 3,132
AA+ Aa1 2,050 Virginia State Public School Authority, Revenue
Refunding Bonds (School Financing), Series I, 5.25%
due 8/01/2007 2,210
=========================================================================================================================
Washington--4.2% AA+ Aa1 6,955 King County, Washington, GO, Series B, 6.625% due
12/01/2015 8,170
NR* Aaa 1,540 Washington State Housing Finance Commission Revenue
Bonds (S/F Program), Series 3N, 5.25% due 12/01/2017
(b)(d) 1,556
Washington State Public Power Supply System, Revenue
Refunding Bonds (Nuclear Project No. 1):
AA- Aa1 3,000 Series A, 7% due 7/01/2008 3,582
AA- Aa1 5,000 Series B, 7.25% due 7/01/2009 5,951
AA- Aa1 14,320 Series B, 7.125% due 7/01/2016 17,953
=========================================================================================================================
Wisconsin--0.5% NR* A3 4,000 Wisconsin State Health and Educational Facilities
Authority, Revenue Refunding Bonds (Saint Claire
Hospital Project), 7% due 2/15/2002 (a) 4,432
=========================================================================================================================
Wyoming--1.2% BBB- Baa2 7,475 Sweetwater County, Wyoming, Solid Waste Disposal
Revenue Bonds (FMC Corp. Project), AMT, Series B,
6.90% due 9/01/2024 8,175
NR* VMIG1+ 250 Uinta County, Wyoming, PCR, Refunding (Chevron USA
Inc. Project), VRDN, 3.20% due 12/01/2022 (g) 250
AA Aa2 2,500 Wyoming Community Development Authority Revenue
Bonds, S/F, AMT, Series H, 7.10% due 6/01/2012 (k) 2,697
=========================================================================================================================
Total Investments (Cost--$824,877)--98.3% 877,136
Other Assets Less Liabilities--1.7% 14,807
--------
Net Assets--100.0% $891,943
========
=========================================================================================================================
</TABLE>
(a) Prerefunded.
(b) FNMA Collateralized.
(c) MBIA Insured.
(d) GNMA Collateralized.
(e) Escrowed to maturity.
(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 February 28, 1999.
(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 February 28, 1999.
(k) FHA Insured.
* 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.
See Notes to Financial Statements.
10 & 11
<PAGE>
MuniVest Fund, Inc., February 28, 1999
STATEMENT OF ASSETS, LIABILITIES AND CAPITAL
<TABLE>
<CAPTION>
As of February 28, 1999
============================================================================================================================
<S> <C> <C> <C>
Assets: Investments, at value (identified cost -- $824,877,159) (Note 1a) ........ $ 877,135,599
Cash ..................................................................... 43,594
Receivables:
Securities sold ........................................................ $ 16,396,324
Interest ............................................................... 10,586,028 26,982,352
-------------
Prepaid expenses and other assets ........................................ 22,503
-------------
Total assets ............................................................. 904,184,048
-------------
============================================================================================================================
Liabilities: Payables:
Securities purchased ................................................... 10,986,839
Dividends to shareholders (Note 1e) .................................... 798,544
Investment adviser (Note 2) ............................................ 343,766 12,129,149
-------------
Accrued expenses and other liabilities ................................... 112,223
-------------
Total liabilities ........................................................ 12,241,372
-------------
============================================================================================================================
Net Assets: Net assets ............................................................... $ 891,942,676
=============
============================================================================================================================
Capital: Preferred Stock, par value $.025 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;
61,346,288 shares issued and outstanding (Note 4) ........................ $ 6,134,629
Paid-in capital in excess of par ......................................... 565,767,507
Undistributed investment income--net ..................................... 6,017,711
Accumulated realized capital losses on investments--net (Note 5) ......... (13,235,611)
Unrealized appreciation on investments--net .............................. 52,258,440
-------------
Total -- Equivalent to $10.06 net asset value per share of Common Stock
(market price--$9.875) ................................................... 616,942,676
-------------
Total capital ............................................................ $ 891,942,676
=============
============================================================================================================================
</TABLE>
* Auction Market Preferred Stock.
See Notes to Financial Statements.
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
For the Six Months Ended February 28, 1999
================================================================================================================
<S> <C> <C> <C>
Investment Interest and amortization of premium and discount earned .. $ 24,988,927
Income (Note 1d):
================================================================================================================
Expenses: Investment advisory fees (Note 2) ......................... $ 2,225,537
Commission fees (Note 4) .................................. 345,142
Transfer agent fees ....................................... 85,594
Professional fees ......................................... 40,203
Accounting services (Note 2) .............................. 39,302
Custodian fees ............................................ 30,031
Printing and shareholder reports .......................... 16,680
Pricing fees .............................................. 12,694
Directors' fees and expenses .............................. 9,657
Listing fees .............................................. 7,193
Other ..................................................... 15,137
------------
Total expenses ............................................ 2,827,170
------------
Investment income--net .................................... 22,161,757
------------
================================================================================================================
Realized & Unreal- Realized gain on investments--net ......................... 7,098,225
ized Gain (Loss) on Change in unrealized appreciation on investments--net ..... (13,379,324)
Investments--Net ------------
(Notes 1b, 1d & 3): Net Increase in Net Assets Resulting from Operations ...... $ 15,880,658
============
================================================================================================================
</TABLE>
See Notes to Financial Statements.
12 & 13
<PAGE>
MuniVest Fund, Inc., February 28, 1999
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
For the Six For the
Months Ended Year Ended
February 28, August 31,
Increase (Decrease) in Net Assets: 1999 1998
==========================================================================================================================
<S> <C> <C> <C>
Operations: Investment income--net ............................................... $ 22,161,757 $ 45,972,603
Realized gain on investments--net .................................... 7,098,225 8,274,227
Change in unrealized appreciation on investments--net ................ (13,379,324) 10,430,911
------------- -------------
Net increase in net assets resulting from operations ................. 15,880,658 64,677,741
------------- -------------
==========================================================================================================================
Dividends & Investment income--net:
Distributions to Common Stock ....................................................... (18,139,014) (36,155,315)
Shareholders Preferred Stock .................................................... (4,465,672) (9,767,310)
(Note 1e): Realized gain on investments--net to Common Stock shareholders ....... (1,863,437) --
------------- -------------
Net decrease in net assets resulting from dividends and distributions
to shareholders ...................................................... (24,468,123) (45,922,625)
------------- -------------
==========================================================================================================================
Capital Stock Value of shares issued to Common Stock shareholders in reinvestment of
Transactions dividends and distributions .......................................... 2,260,151 --
(Note 4): ------------- -------------
==========================================================================================================================
Net Assets: Total increase (decrease) in net assets .............................. (6,327,314) 18,755,116
Beginning of period .................................................. 898,269,990 879,514,874
------------- -------------
End of period* ....................................................... $ 891,942,676 $ 898,269,990
============= =============
==========================================================================================================================
*Undistributed investment income--net ................................. $ 6,017,711 $ 6,460,640
============= =============
==========================================================================================================================
</TABLE>
See Notes to Financial Statements.
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
The following per share data and ratios For the
have been derived from information Six Months
provided in the financial statements. Ended For the Year Ended August 31,
February 28, --------------------------------------------
Increase (Decrease) in Net Asset Value: 1999 1998 1997 1996 1995
===================================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Net asset value, beginning of period .............. $ 10.20 $ 9.89 $ 9.45 $ 9.51 $ 9.57
Performance: -------- -------- -------- -------- --------
Investment income--net ............................ .37 .76 .77 .79 .81
Realized and unrealized gain (loss) on
investments--net .................................. (.10) .30 .45 (.06) .10
-------- -------- -------- -------- --------
Total from investment operations .................. .27 1.06 1.22 .73 .91
-------- -------- -------- -------- --------
Less dividends and distributions to Common Stock
shareholders:
Investment income--net .......................... (.30) (.59) (.62) (.63) (.64)
Realized gain on investments--net ............... (.03) -- -- -- (.12)
In excess of realized gain on investments--net .. -- -- -- -- (.04)
-------- -------- -------- -------- --------
Total dividends and distributions to Common Stock
shareholders ...................................... (.33) (.59) (.62) (.63) (.80)
-------- -------- -------- -------- --------
Effect of Preferred Stock activity:
Dividends to Preferred Stock shareholders from
investment income--net .......................... (.08) (.16) (.16) (.16) (.17)
-------- -------- -------- -------- --------
Net asset value, end of period .................... $ 10.06 $ 10.20 $ 9.89 $ 9.45 $ 9.51
======== ======== ======== ======== ========
Market price per share, end of period ............. $ 9.875 $ 10.00 $ 9.50 $ 9.125 $ 8.563
======== ======== ======== ======== ========
===================================================================================================================================
Total Investment Based on market price per share ................... 2.12%+ 11.78% 11.25% 14.18% 10.88%
Return:** ======== ======== ======== ======== ========
Based on net asset value per share ................ 1.99%+ 9.52% 11.84% 6.46% 9.38%
======== ======== ======== ======== ========
===================================================================================================================================
Ratios to Average Expenses .......................................... .64%* .64% .64% .64% .66%
Net Assets:*** ======== ======== ======== ======== ========
Investment income--net ............................ 4.98%* 5.19% 5.40% 5.57% 5.91%
======== ======== ======== ======== ========
===================================================================================================================================
Supplemental Data: Net assets, net of Preferred Stock, end of period
(in thousands) .................................... $616,943 $623,270 $604,515 $577,540 $581,211
======== ======== ======== ======== ========
Preferred Stock outstanding, end of period (in
thousands) ........................................ $275,000 $275,000 $275,000 $275,000 $275,000
======== ======== ======== ======== ========
Portfolio turnover ................................ 48.65% 102.77% 78.02% 69.87% 71.95%
======== ======== ======== ======== ========
===================================================================================================================================
Leverage: Asset coverage per $1,000 ......................... $ 3,243 $ 3,266 $ 3,198 $ 3,100 $ 3,113
======== ======== ======== ======== ========
===================================================================================================================================
Dividends Per Series A--Investment income--net .................. $ 418 $ 890 $ 872 $ 895 $ 922
Share on Preferred ======== ======== ======== ======== ========
Stock Outstanding: Series B--Investment income--net .................. $ 442 $ 902 $ 871 $ 903 $ 946
======== ======== ======== ======== ========
Series C--Investment income--net .................. $ 383 $ 886 $ 860 $ 900 $ 947
======== ======== ======== ======== ========
Series D--Investment income--net .................. $ 385 $ 880 $ 868 $ 901 $ 1,014
======== ======== ======== ======== ========
Series E--Investment income--net .................. $ 403 $ 884 $ 868 $ 895 $ 968
======== ======== ======== ======== ========
===================================================================================================================================
</TABLE>
* Annualized.
** 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 effects of sales loads.
*** Do not reflect the effect of dividends to Preferred Stock
shareholders.
+ Aggregate total investment return.
See Notes to Financial Statements.
14 & 15
<PAGE>
MuniVest Fund, Inc., February 28, 1999
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's financial statements are prepared in accordance with generally accepted
accounting principles which may require the use of management accruals and
estimates. These unaudited financial statements reflect all adjustments which
are, in the opinion of management, necessary to a fair statement of the results
for the interim period presented. All such adjustments are of a normal recurring
nature. 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 and options thereon,
which are traded on exchanges, are valued at their closing prices as of the
close of such exchanges. Options written or purchased are valued at the last
sale price in the case of exchange-traded options. In the case of options traded
in the over-the-counter market, valuation is the last asked price (options
written) or the last bid price (options purchased). 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
Board of 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.
o Financial futures contracts--The Fund may purchase or sell financial 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.
o 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.
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. ("ML &
Co."), which is the limited partner.
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, and/or ML & Co.
3. Investments:
Purchases and sales of investments, excluding short-term securities, for the six
months ended February 28, 1999 were $420,589,121 and $447,714,439, respectively.
Net realized gains for the for the six months ended February 28, 1999 and net
unrealized gains as of February 28, 1999 were as follows:
- --------------------------------------------------------------------------------
Realized Unrealized
Gains Gains
- -------------------------------------------------------------------------------
Long-term investments .............................. $ 7,098,225 $52,258,440
----------- -----------
Total .............................................. $ 7,098,225 $52,258,440
=========== ===========
- -------------------------------------------------------------------------------
As of February 28, 1999, net unrealized appreciation for Federal income tax
purposes aggregated $52,258,440, all of which related to appreciated securities.
The aggregate cost of investments at February 28, 1999 for Federal income tax
purposes was $824,877,159.
4. Capital Stock Transactions:
Common Stock
At February 28, 1999, the Fund had one class of shares of Common Stock, par
value $.10 per share, of which 150,000,000 shares were authorized. Shares issued
and outstanding during the six months ended February 28, 1999 increased by
223,148 from shares sold and for the year ended August 31, 1998 remained
constant.
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 of Preferred Stock. The yields in effect
February 28, 1999 were as follows: Series A, 2.95%; Series B, 3.05%; Series C,
3.00%; Series D, 3.03%; and Series E, 2.70%.
Shares issued and outstanding during the six months ended February 28, 1999 and
the year ended August 31, 1998 remained constant.
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 six months ended February 28, 1999, Merrill Lynch,
Pierce, Fenner & Smith Incorporated, an affiliate of FAM, received $168,831 as
commissions.
5. Capital Loss Carryforward:
At August 31, 1998, the Fund had a net capital loss carryforward of
approximately $3,631,000, all of which expires in 2004. This amount will be
available to offset like amounts of any future taxable gains.
6. Subsequent Event:
On March 8, 1999, the Fund's Board of Directors declared an ordinary income
dividend to Common Stock shareholders in the amount of $.044139 per share,
payable on March 30, 1999 to shareholders of record as of March 24, 1999.
16 & 17
<PAGE>
MuniVest Fund, Inc., February 28, 1999
YEAR 2000 ISSUES
Many computer systems were designed using only two digits to designate years.
These systems may not be able to distinguish the Year 2000 from the Year 1900
(commonly known as the "Year 2000 Problem"). The Fund could be adversely
affected if the computer systems used by the Fund's management or other Fund
service providers do not properly address this problem before January 1, 2000.
The Fund's management expects to have addressed this problem before then, and
does not anticipate that the services it provides will be adversely affected.
The Fund's other service providers have told the Fund's management that they
also expect to resolve the Year 2000 Problem, and the Fund's management will
continue to monitor the situation as the Year 2000 approaches. However, if the
problem has not been fully addressed, the Fund could be negatively affected. The
Year 2000 Problem could also have a negative impact on the securities in which
the Fund invests, and this could hurt the Fund's investment returns.
MANAGED DIVIDEND POLICY
The Fund's dividend policy is to distribute substantially all of its net
investment income to its shareholders on a monthly basis. However, in order to
provide shareholders with a more consistent yield to the current trading price
of shares of Common Stock of the Fund, the Fund may at times pay out less than
the entire amount of net investment income earned in any particular month and
may at times in any particular month pay out such accumulated but undistributed
income in addition to net investment income earned in that month. As a result,
the dividends paid by the Fund for any particular month may be more or less than
the amount of net investment income earned by the Fund during such month. The
Fund's current accumulated but undistributed net investment income, if any, is
disclosed in the Statement of Assets, Liabilities and Capital, which comprises
part of the financial information included in this report.
OFFICERS AND DIRECTORS
Terry K. Glenn, President and Director
Ronald W. Forbes, Director
Cynthia A. Montgomery, Director
Charles C. Reilly, Director
Kevin A. Ryan, Director
Richard R. West, Director
Arthur Zeikel, Director
Vincent R. Giordano, Senior Vice President
Kenneth A. Jacob, Vice President
Fred K. Stuebe, Vice President
Donald C. Burke, Vice President and Treasurer
Patrick D. Sweeney, Secretary
- --------------------------------------------------------------------------------
Gerald M. Richard, Treasurer of MuniVest Fund, Inc. has recently retired. His
colleagues at Merrill Lynch Asset Management, L.P. join the Fund's Board of
Directors in wishing Mr. Richard well in his retirement.
- --------------------------------------------------------------------------------
Custodian
The Bank of New York
90 Washington Street
New York, NY 10286
ASE Symbol
MVF
Transfer Agents
Common Stock:
The Bank of New York
101 Barclay Street
New York, NY 10286
Preferred Stock:
IBJ Whitehall Bank & Trust Company
One State Street
New York, NY 10004
18 & 19
<PAGE>
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 of 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.
Statements and other information herein are as dated and are subject to change.
MuniVest Fund, Inc.
Box 9011
Princeton, NJ
08543-9011 #10787--2/99
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