Putnam
High Yield
Municipal
Trust
SEMIANNUAL REPORT ON PERFORMANCE AND OUTLOOK
9-30-99
[LOGO: BOSTON * LONDON * TOKYO]
From the Chairman
[GRAPHIC OMITTED: PHOTO OF GEORGE PUTNAM]
[copyright] Karsh, Ottawa
Dear Shareholder:
If history tells us anything about bond investing, it is this -- buying a
bond fund after a bad year is often a smart thing to do. The bond market
has endured its toughest year since 1994 and the second-worst year on
record, the result of two moves by the Federal Reserve Board to raise
interest rates. Within this challenging market environment, Putnam High
Yield Municipal Trust met its goals of providing high current tax-exempt
income by investing in higher-yielding, lower-rated municipal bonds. Not
surprisingly though, higher interest rates are also symptomatic of falling
bond prices and the fund's performance reflects this unavoidable
relationship.
Total return for 6 months ended 9/30/99
Net asset value Market price
- ----------------------------------------------------------------
-1.95% -25.64%
- ----------------------------------------------------------------
Past performance is no indication of future results. Performance
information for longer periods begins on page 6.
* MANAGEMENT MAINTAINS CONFIDENCE IN MUNICIPAL BONDS
Getting back to the importance of history, after the bond bear markets of
1989 and 1994, considerable buying opportunities were available to
investors. Your fund's manager, Blake Anderson, believes that similar
opportunities are present now for several reasons. The first is that a
30-year AAA-rated municipal bond currently offers a 6% yield, an extremely
high level for the tax-free sector, registering almost 97% of the yield on
a 30-year taxable Treasury bond. With inflation still remarkably low at 3%
or less, after-tax, after-inflation returns are the highest investors have
seen in years.
[GRAPHIC OMITTED: pie chart CREDIT QUALITY OVERVIEW]
CREDIT QUALITY OVERVIEW*
B -- 19.2%
BB/Ba -- 16.4%
BBB/Baa -- 25.2%
AAA/Aaa -- 37.2%
AA/Aa -- 2.0%
Footnote reads:
*As a percentage of market value as of 9/30/99. A bond rated Baa or higher
is considered investment grade. All ratings reflect Moody's descriptions
unless noted otherwise; percentages may include unrated bonds considered
by Putnam Management to be of comparable quality. Ratings will vary over
time.
Furthermore, after two interest-rate increases by the Fed and several
inflation scares, Blake believes that most of the potentially negative
developments have already been priced in. Even if there is another
interest hike in November, it is likely that most of the damage has been
done and the worst is over for the bond markets.
* OPPORTUNITY FOUND IN LOWER-RATED CREDITS AND INTERMEDIATE MATURITIES
In line with the objectives of this fund, Blake continued to emphasize the
lower-credit sectors (BBB-rated and below) in which higher yields
compensate investors for taking on a bit more risk. Since credit quality
is at an all-time high, thanks to the strong economy, there is much less
risk associated with lower-rated bonds than in previous years.
The health-care industry is one sector in which higher yields are the main
attraction but credit quality is a key issue. Because of concerns about
the effects of Medicare reform proposals and of Y2K disruptions, Blake has
been cautious about any new purchases in this sector.
One other key strategy he has used involves investing in intermediate to
long/intermediate maturities of 10 to 15 years. As interest rates have
fallen, the yield curve has steepened, and intermediate bonds have
outperformed other maturity ranges. Additionally, within each maturity
range, Blake relies heavily on credit analysis as additional tools to
evaluate investments for the fund.
* STRONGER POTENTIAL FOR BONDS SEEN IN NEAR FUTURE
Although the Fed did not raise interest rates in October, it has declared
a bias toward tightening should inflation appear stronger. The threat of
inflation remains the primary force driving volatility in both the bond
and stock markets. The historical connection between prolonged growth and
inflation haunts the markets, even as actual reported inflation lies
dormant. It seems that the tightening bias has already been priced into
the bond market's adverse behavior, clearing the way for better
performance.
[GRAPHIC OMITTED: TOP 10 HOLDINGS]
TOP 10 HOLDINGS
Iowa Financing Authority Health Care Facility
9.25% 7/1/25
Los Angeles, California, Regional Airport Improvement Corp.
9.25% 8/1/24
Delaware Valley Regional Finance Authority
7.75% 7/1/27
Butler, Alabama, Industrial Development Board
8.00% 9/1/28
Midland County, Michigan, Economic Development Corp.
9.50% 7/23/09
Denver City and County Airport Authority
8.50% 11/15/23
Massachusetts State Port Authority
10.00% 3/1/26
Texas State Housing and Community Affairs Home Mortgage
9.61% 7/2/24
Hodge, Louisiana Combined Utility
9.00% 3/1/10
Massachusetts State Industrial Financing Agency
9.00% 5/1/22
Footnote reads:
These holdings represent 27.6% of the fund's net assets as of 9/30/99.
Portfolio holdings will vary over time.
Furthermore, with equities beginning to look vulnerable as the semiannual
period ended, and with concern over Y2K likely to grow in the coming
months, bonds may gain appeal as a safe haven asset in the fourth quarter.
With this sentiment and the belief that bonds are fairly valued as of this
writing, Blake is inclined to take slightly more risk in the fund
portfolios now, extending maturities as opportunities arise. It has always
been our belief that choppy markets provide us with the opportunity to add
yield, find exceptional credits, and improve call protection -- strategies
that are very rewarding for shareholders over time.
Respectfully yours,
/S/GEORGE PUTNAM
George Putnam
Chairman of the Trustees
November 17, 1999
The views expressed here are exclusively those of Putnam Management. They
are not meant as investment advice. Although the described holdings were
viewed favorably as of 9/30/99, there is no guarantee the fund will
continue to hold these securities in the future. The lower credit ratings
of high-yield bonds reflect a greater possibility that adverse changes in
the economy or poor performance by the issuers of these bonds may affect
the issuer's ability to pay principal and interest.
Performance summary
This section provides information about your fund's performance, which
should always be considered in light of its investment strategy. Putnam
High Yield Municipal Trust is designed for investors seeking high current
income free from federal income tax through higher-yielding, lower-rated
municipal bonds.
TOTAL RETURN FOR PERIODS ENDED 9/30/99
Market Lehman Bros. Consumer
NAV price Municipal Bond Index price index
- -------------------------------------------------------------------------
6 months -1.95% -25.64% -2.16% 1.76%
- -------------------------------------------------------------------------
1 year 0.15 -21.90 -0.70 2.75
- -------------------------------------------------------------------------
5 years 39.45 18.46 38.78 12.38
Annual average 6.88 3.45 6.77 2.36
- -------------------------------------------------------------------------
10 years 103.72 72.99 103.85 34.32
Annual average 7.37 5.63 7.38 2.99
- -------------------------------------------------------------------------
Life of fund
(since 5/25/89) 109.07 72.23 106.76 35.62
Annual average 7.39 5.39 7.28 2.99
- -------------------------------------------------------------------------
Past performance is no assurance of future results. More recent returns
may be more or less than those shown. They do not take into account any
adjustment for taxes payable on reinvested distributions. Investment
returns, net asset value and market price will fluctuate so that an
investor's shares when sold may be worth more or less than their original
cost.
Terms and definitions
Total return shows how the value of the fund's shares changed over time,
assuming you held the shares through the entire period and reinvested all
distributions in the fund.
Net asset value (NAV) is the value of all your fund's assets, minus any
liabilities and the net assets allocated to remarketed preferred shares
divided by the number of outstanding common shares.
Market price is the current trading price of one share of the fund. Market
prices are set by transactions between buyers and sellers on the New York
Stock Exchange.
PRICE AND DISTRIBUTION INFORMATION 6 MONTHS ENDED 9/30/99
- ---------------------------------------------------------------------------
Distributions (common shares)
- ---------------------------------------------------------------------------
Number 6
- ---------------------------------------------------------------------------
Income1 $0.3355
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Capital gains1 --
- ---------------------------------------------------------------------------
Total $0.3355
- ---------------------------------------------------------------------------
Preferred shares Series A (900 shares)
- ---------------------------------------------------------------------------
Income1 $827.29
- ---------------------------------------------------------------------------
Capital gains1 --
- ---------------------------------------------------------------------------
Total $827.29
- ---------------------------------------------------------------------------
Share value (common shares) NAV Market price
- ---------------------------------------------------------------------------
3/31/99 $9.14 $10.938
- ---------------------------------------------------------------------------
9/30/99 8.63 7.875
- ---------------------------------------------------------------------------
Current return (common shares/end of period)
- ---------------------------------------------------------------------------
Current dividend rate2 6.67% 7.31%
- ---------------------------------------------------------------------------
Taxable equivalent3 11.05 12.11
- ---------------------------------------------------------------------------
1Capital gains if any, are taxable for federal and, in most cases, state
tax purposes. For some investors, investment income may also be subject to
the federal alternative minimum tax. Investment income may be subject to
state and local taxes.
2Income portion of most recent distribution, annualized and divided by
NAV or POP at end of period.
3Assumes maximum 39.6% combined federal and state tax rate. Results for
investors subject to lower tax rates would not be as advantageous.
Comparative benchmarks
Lehman Brothers Municipal Bond Index is an unmanaged list of long-term
fixed-rate investment-grade tax-exempt bonds representative of the
municipal bond market. Securities indexes assume reinvestment of all
distributions and interest payments and do not take in account brokerage
fees or taxes. Securities in the fund do not match those in the indexes
and performance of the fund will differ. It is not possible to invest
directly in the index.
Consumer price index (CPI) is a commonly used measure of inflation; it
does not represent an investment return.
A guide to the financial statements
These sections of the report constitute the fund's financial
statements.
The fund's portfolio lists all the fund's investments and their values as
of the last day of the reporting period. Holdings are organized by asset
type and industry sector, country, or state to show areas of concentration
and diversification.
Statement of assets and liabilities shows how the fund's net assets and
share price are determined. All investment and non-investment assets are
added together. Any unpaid expenses and other liabilities are subtracted
from this total. The result is divided by the number of shares to
determine the net asset value per share, which is calculated separately
for each class of shares. (For funds with preferred shares, the amount
subtracted from total assets includes the net assets allocated to
remarketed preferred shares.)
Statement of operations shows the fund's net investment gain or loss for
the reporting period. This is determined by adding up all the fund's
earnings -- from dividends and interest income -- and subtracting its
operating expenses. This statement also lists any net gain or loss the
fund realized on the sales of its holdings and -- for holdings that remain
in the portfolio -- any change in unrealized gains or losses over the
period.
Statement of changes in net assets shows how the fund's net assets were
affected by distributions to shareholders and by changes in the number of
the fund's shares. It lists distributions and their sources (net
investment income or realized capital gains) over the current reporting
period and the most recent fiscal year-end. The distributions listed here
may not match the sources listed in the Statement of operations because
the distributions are determined on a tax basis and may be paid in a
different period from the one in which they were earned.
Financial highlights provide an overview of the fund's investment results,
per-share distributions, expense ratios, net investment income ratios and
portfolio turnover in one summary table, reflecting the five most recent
reporting periods. In a semiannual report, the highlight table also
includes the current reporting period. For open-ended funds, a separate
table is provided for each share class.
<TABLE>
<CAPTION>
The fund's portfolio
September 30, 1999 (Unaudited)
KEY TO ABBREVIATIONS
AMBAC -- AMBAC Indemnity Corporation
FGIC -- Financial Guaranty Insurance Company
FNMA Coll. -- Federal National Mortgage Association Collateralized
FSA -- Financial Security Assurance
GNMA Coll. -- Government National Mortgage Association Collateralized
IFB -- Inverse Floating Rate Bonds
IF COP -- Inverse Floating Rate Certificate of Participation
MBIA -- Municipal Bond Investors Assurance Corporation
U.S. Govt. Coll. -- U.S. Government Collateralized
MUNICIPAL BONDS AND NOTES (98.7%) (a)
PRINCIPAL AMOUNT RATING (RAT) VALUE
<S> <C> <C> <C>
Alabama (2.7%)
- --------------------------------------------------------------------------------------------------------------------------
$ 5,750,000 Butler, Indl. Dev. Board Rev. Bonds (Solid Waste
Disp. James River Corp.), 8s, 9/1/28 BBB $ 6,360,938
Arizona (2.5%)
- --------------------------------------------------------------------------------------------------------------------------
2,500,000 Coconino Cnty., Poll. Control Corp. Rev. Bonds
(Tucson/Navajo Elec. Pwr.), Ser. A,
7 1/8s, 10/1/32 B 2,690,625
3,000,000 Tucson, Arpt. Auth. Special Fac. Rev. Bonds
(Lockheed Aermod Ctr. Inc.), 8.7s, 9/1/19 Baa2 3,165,600
--------------
5,856,225
Arkansas (0.5%)
- --------------------------------------------------------------------------------------------------------------------------
1,000,000 Northwest Regl. Apt. Auth. Rev. Bonds,
7 5/8s, 2/1/27 BB/P 1,093,750
California (8.2%)
- --------------------------------------------------------------------------------------------------------------------------
3,500,000 CA Hlth. Fac. Auth. Rev. Bonds (Cedar-Sinai
Med. Ctr.), MBIA, 5 1/8s, 8/1/27 Aaa 3,176,250
5,700,000 CA Statewide Cmnty. Dev. Auth. IF COP
(Motion Picture & TV Fund), AMBAC, 5.35s,
1/1/22 Aaa 5,023,125
4,000,000 Foothill/Eastern Corridor Agcy. CA Toll Road
Rev. Bonds, 5 3/4s, 1/15/40 BBB- 3,820,000
6,320,000 Los Angeles, Regl. Arpt. Impt. Corp Rev. Bonds
(Continental Airlines), 9 1/4s, 8/1/24 BB+/P 7,275,900
--------------
19,295,275
Colorado (5.2%)
- --------------------------------------------------------------------------------------------------------------------------
Denver, City & Cnty. Arpt. Rev. Bonds, Ser. A
3,670,000 8 3/4s, 11/15/23 Baa1 3,991,125
1,330,000 8 3/4s, 11/15/23, Prerefunded Aaa 1,472,975
Denver, City & Cnty. Arpt. Rev. Bonds, Ser. A
5,805,000 MBIA, 8 1/2s, 11/15/23 (SEG) Aaa 6,160,556
545,000 MBIA, 8 1/2s, 11/15/23, Prerefunded (SEG) Aaa 582,469
--------------
12,207,125
Delaware (2.7%)
- --------------------------------------------------------------------------------------------------------------------------
5,000,000 Delaware Valley, Regl. Fin. Auth. Govt. Rev. Bonds,
Ser. C, AMBAC, 7 3/4s, 7/1/27 Aaa 6,368,750
Florida (0.6%)
- --------------------------------------------------------------------------------------------------------------------------
1,500,000 Lee Cnty., Indl. Dev. Auth. Hlth. Care Facs. Rev.
Bonds (Cypress Cove Hlth. Pk.), Ser. A,
6 3/8s, 10/1/25 BB/P 1,455,000
Georgia (4.1%)
- --------------------------------------------------------------------------------------------------------------------------
3,025,000 De Kalb Cnty., Hsg. Auth. Muni. Rev. Bonds
(Briarcliff Park Apts.), Ser. B, 10s, 4/1/17 AAA/P 3,516,563
2,000,000 Forsyth Cnty., Hosp. Auth. Rev. Bonds
(Babtist Hlthcare Sys.), 6 1/4s, 10/1/18 B/P 1,905,000
3,900,000 GA Med. Ctr. Hosp. Auth. IFB (Columbus Regl.
Hlth. Care Syst.), Ser. B, MBIA, 8.495s, 8/1/10 Aaa 4,319,250
--------------
9,740,813
Illinois (6.0%)
- --------------------------------------------------------------------------------------------------------------------------
Chicago, O'Hare Intl. Arpt. Special Fac. Rev. Bonds
2,268,000 (United Air Lines, Inc.), Ser. B, 8.95s, 5/1/18 Baa2 2,425,286
1,715,000 (United Air Lines, Inc.), Ser. 84A, 8.85s, 5/1/18 Baa2 1,832,169
4,250,000 (American Airlines, Inc.), 8.2s, 12/1/24 Baa1 4,829,063
2,680,000 East Chicago, Ind. Exempt Fac Rev. Bonds
(Ispat Inland, Inc.), 7s, 1/1/14 B+ 2,576,150
IL Dev. Fin. Auth. Rev. Bonds (Cmnty. Rehab.
Providers Fac.), Ser. A
905,000 7 7/8s, 7/1/20 B/P 1,063,375
1,260,000 7 7/8s, 7/1/20, Prerefunded AAA/P 1,475,775
--------------
14,201,818
Indiana (3.1%)
- --------------------------------------------------------------------------------------------------------------------------
3,000,000 Fort Wayne, Hosp. Auth. Rev. Bonds (Parkview
Hlth. Syst., Inc.), MBIA, 4 3/4s, 11/15/28 Aaa 2,460,000
4,500,000 Indianapolis Indl. Arpt. Auth. Special Fac. Rev.
Bonds (Federal Express Corp.), 7.1s, 1/15/17 Baa2 4,871,250
--------------
7,331,250
Iowa (5.5%)
- --------------------------------------------------------------------------------------------------------------------------
2,000,000 Des Moines, Hosp. Rev. Bonds (Des Moines
Genl. Hosp.), Ser. B, 8 1/4s, 11/15/11 B-/P 2,037,500
8,500,000 IA Fin. Auth. Hlth. Care Fac. Rev. Bonds
(Care Initiatives), 9 1/4s, 7/1/25 BB/P 10,911,875
--------------
12,949,375
Kentucky (2.4%)
- --------------------------------------------------------------------------------------------------------------------------
4,000,000 Boone Cnty. Poll. Control Rev. Bonds (Dayton
Pwr. & Lt. Co.), Ser. A, 6 1/2s, 11/15/22 Aa3 4,275,000
1,435,000 Jefferson Cnty., 1st Mtge. Rev. Bonds
(AHF/KY-IOWA, Inc.), 10 1/4s, 1/1/20 B-/P 1,474,463
--------------
5,749,463
Louisiana (4.6%)
- --------------------------------------------------------------------------------------------------------------------------
5,000,000 Hodge, Combined Util. Rev. Bonds
(Stone Container Corp.), 9s, 3/1/10 B/P 5,158,450
2,500,000 LA Pub. Fac. Auth. 1st Mtge. Rev. Bonds
(St. James Place), 10s, 11/1/21 B-/P 2,731,250
3,000,000 W. Feliciana, Parish Poll. Control Rev. Bonds
(Gulf States Util. Co.), 8s, 12/1/24 Ba1 3,071,880
--------------
10,961,580
Massachusetts (16.0%)
- --------------------------------------------------------------------------------------------------------------------------
MA State Hlth. & Edl. Fac. Auth. IFB
3,000,000 (St. Elizabeth Hosp.), Ser. E, FSA, 9.82s, 8/12/21 Aaa 3,270,000
2,000,000 (New England Medical Ctr.), MBIA, 6.73s, 7/1/18 Aaa 1,817,500
4,500,000 MA State Hsg. Fin. Agcy. Rev. Bonds, Ser. 53,
MBIA, 6.15s, 12/1/29 (SEG) Aaa 4,567,500
MA State Indl. Fin. Agcy. Res. Recvy. Rev. Bonds
(Southeastern MA)
1,500,000 Ser. B, 9 1/4s, 7/1/15 BB-/P 1,636,875
3,500,000 Ser. A, 9s, 7/1/15 BB-/P 3,810,625
MA State Indl. Fin. Agcy. Rev. Bonds
900,000 (Odd Fellows Home of MA), 9.6s, 1/1/15 AAA/P 930,060
4,500,000 (Orchard Cove Inc.), U. S. Govt. Coll., 9s, 5/1/22 AAA/P 5,118,750
2,340,000 (MA Tpk.), 9s, 10/1/20 AAA/P 2,492,123
4,250,000 (Emerson College), 8.9s, 1/1/18 BBB-/P 4,574,063
3,315,000 (Evanswood Bethzatha), 7.85s, 1/15/17 B-/P 3,348,150
5,800,000 MA State Port Auth. Rev. Bonds
(Harborside Hyatt), 10s, 3/1/26 B/P 6,097,250
--------------
37,662,896
Michigan (6.4%)
- --------------------------------------------------------------------------------------------------------------------------
2,545,000 Detroit, Dev. Fin. Auth. Tax Increment Rev.
Bonds, Ser. A, 9 1/2s, 5/1/21 BBB+/P 2,949,019
4,700,000 MI State Strategic Fund Ltd. Oblig. Rev.
Bonds (Mercy Svcs. for Aging), 9.4s, 5/15/20 Aaa 4,946,938
1,000,000 MI State Strategic Fund Resource Recvy. Ltd.
Oblig. Rev. Bonds (Central Wayne Energy Rec.),
Ser. A, 7s, 7/1/27 B/P 957,500
6,000,000 Midland Cnty., Econ. Dev. Corp. Rev. Bonds
(Poll. Ctrl.), Ser. B, 9 1/2s, 7/23/09 B+/P 6,287,880
--------------
15,141,337
Missouri (2.0%)
- --------------------------------------------------------------------------------------------------------------------------
4,600,000 Kansas City, Indl. Dev. Auth. Hlth. Fac. Rev. Bonds
(Park Lane Med. Ctr.), 8 3/4s, 1/1/15 BB+/P 4,713,202
Nebraska (0.5%)
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1,000,000 NE Investment Fin. Auth. Hosp. IFB, MBIA,
9.284s, 11/15/16 Aaa 1,091,250
Nevada (1.4%)
- --------------------------------------------------------------------------------------------------------------------------
3,000,000 Clark Cnty., Indl. Dev. Rev. Bonds (Southwest
Gas Corp.), Ser. B, 7 1/2s, 9/1/32 Baa2 3,206,250
New Hampshire (2.2%)
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NH Higher Ed. & Hlth. Fac. Auth. Rev. Bonds
1,850,000 (Havenwood-Heritage Heights), U. S. Govt.
Coll., 9 3/4s, 12/1/19 AAA/P 1,921,836
1,000,000 (NH College), 6 3/8s, 1/1/27 BBB- 982,500
1,000,000 NH State Bus. Fin. Auth. Rev. Bonds (Franklin
Regl. Hosp. Assn. PJ), Ser. A, 6.05s, 9/1/29 BBB/P 931,250
1,500,000 NH State Bus. Fin. Auth. Swr. & Soild Waste
Rev. Bonds (Crown Paper), 7 7/8s, 7/1/26 B 1,432,500
--------------
5,268,086
New York (5.8%)
- --------------------------------------------------------------------------------------------------------------------------
2,350,000 NY State Energy Res. & Dev. Auth. Poll.
Control IFB, FGIC, 8.671s, 7/1/29
(acquired 12/19/94, cost $2,453,729) (RES) Aaa 2,802,375
3,000,000 NY State Hsg. Fin. Agcy. Svcs. Contract Oblig.
Rev. Bonds, Ser. A, 7 3/8s, 9/15/21 AAA 3,270,000
NY State Local Govt. Assistance Corp. Rev.
Bonds
1,500,000 Ser. A, 7s, 4/1/16 Aaa 1,590,000
2,000,000 Ser. D, 6 3/4s, 4/1/21 Aaa 2,155,000
1,500,000 Onondaga Cnty., Indl. Dev. Agcy. Rev. Bonds
(Solvay Paperboard LLC), 7s, 11/1/30 B/P 1,500,000
2,160,000 Port Auth. NY & NJ Special Oblig. Rev. Bonds
(Continental/Eastern Laguardia), 9 1/8s, 12/1/15 Ba2 2,292,300
--------------
13,609,675
Oregon (0.4%)
- --------------------------------------------------------------------------------------------------------------------------
1,000,000 Multnomah Cnty., Hosp. Fac. Auth. Rev. Bonds
(Terwilliger Plaza Project), 6 1/2s, 12/1/29 BB-/P 948,750
Pennsylvania (6.3%)
- --------------------------------------------------------------------------------------------------------------------------
280,000 Allegheny Cnty., Indl. Dev. Auth. Arpt. Spl. Facs.
Rev. Bonds, 8 7/8s, 3/1/21 B+ 302,400
2,000,000 Montgomery Cnty., Higher Ed. & Hlth. Auth.
Hosp. Rev. Bonds (United Hosp. Inc.),
Ser. A, 8 3/8s, 11/1/11 AAA 2,046,520
3,250,000 PA Econ. Dev. Fin. Auth. Rev. Bonds
(MacMillan Ltd. Partnership), 7.6s, 12/1/20 Baa2 3,761,875
2,500,000 PA State Higher Ed. Assistance Agcy. Student
Loan IFB, AMBAC, 8.405s, 9/1/26 Aaa 2,921,875
2,100,000 Philadelphia, Muni. Auth. Rev. Bonds,
Ser. C, 8 5/8s, 11/15/16 Aaa 2,328,375
3,400,000 Philadelphia, Regl. Port Auth. Lease IFB
(Kidder Peabody), MBIA, 8.15s, 9/1/13 Aaa 3,629,500
--------------
14,990,545
Texas (5.1%)
- --------------------------------------------------------------------------------------------------------------------------
1,000,000 Abilene Hlth. Fac. Dev. Corp. Rev. Bonds (Sears
Methodist Retirement), 5 7/8s, 11/15/18 BB+/P 935,000
2,500,000 Alliance, Arpt. Auth. Special Fac. Rev. Bonds
(American Airlines, Inc.), 7 1/2s, 12/1/29 Baa1 2,618,750
675,000 Cherokee Cnty., Hlth. Fac. Dev. Corp. Rev. Bonds
(Nancy Travis Memorial Hosp.), 10s, 5/15/13 B/P 771,188
2,500,000 Tomball Hosp. Auth. Rev. Bonds (Tomball Regl.
Hosp.), 6s, 7/1/29 BBB/P 2,378,125
4,800,000 TX State Hsg. & Cmnty. Affairs Home Mtge. IFB,
Ser. C, GNMA Coll, FNMA Coll, 9.612s, 7/2/24 AAA 5,322,000
--------------
12,025,063
Utah (3.3%)
- --------------------------------------------------------------------------------------------------------------------------
3,300,000 Carbon Cnty., Util. Rev. Bonds (Laidlaw Solid
Waste Disp.), Ser. A, 7 1/2s, 2/1/10 BBB 3,576,375
4,000,000 Tooele Cnty., Poll. Control Rev. Bonds
(Laidlaw Enviromental), Ser. A, 7.55s, 7/1/27 B/P 4,300,000
--------------
7,876,375
West Virginia (1.0%)
- --------------------------------------------------------------------------------------------------------------------------
2,500,000 Princeton Hosp. Rev. Bonds (Cmnty. Hosp.
Assn., Inc.), 6.1s, 5/1/29 BBB 2,412,500
Wisconsin (0.2%)
- --------------------------------------------------------------------------------------------------------------------------
430,000 WI Hsg. & Econ. Dev. Auth. IFB (Home
Ownership Dev.), 9.753s, 10/25/22 Aa3 453,650
- --------------------------------------------------------------------------------------------------------------------------
Total Investments (cost $228,213,653) (b) $ 232,970,941
- --------------------------------------------------------------------------------------------------------------------------
(a) Percentages indicated are based on net assets of $236,108,141.
(RAT) The Moody's or Standard & Poor's ratings indicated are believed to be the most recent ratings available at
September 30, 1999 for the securities listed. Ratings are generally ascribed to securities at the time of issuance.
While the agencies may from time to time revise such ratings, they undertake no obligation to do so, and the ratings
do not necessarily represent what the agencies would ascribe to these securities at September 30, 1999. Securities
rated by Putnam are indicated by "/P" and are not publicly rated.
(b) The aggregate identified cost on a tax basis is $228,213,653, resulting in gross unrealized appreciation and
depreciation of $10,252,469 and $5,495,181, respectively, or net unrealized appreciation of $4,757,288.
(RES) Restricted, excluding 144A securities, as to public resale. The total market value of restricted securities held at
September 30, 1999 was $2,802,375 or 1.2% of net assets.
(SEG) A portion of these securities were pledged and segregated with the custodian to cover margin requirements for
futures contracts at September 30, 1999.
The rates shown on IFB and IF COP, which are securities paying interest rates that vary inversely to changes in the
market interest rates, are the current interest rates at September 30, 1999.
The fund had the following industry group concentrations greater than 10% at September 30, 1999 (as a percentage of
net assets):
Transportation 24.0%
Health care 22.5
Utilities 11.9
The fund had the following insurance concentration greater than 10% at September 30, 1999 (as a percentage of net
assets):
MBIA 11.9%
- -------------------------------------------------------------------------------------
Futures Contracts Outstanding at September 30, 1999 (Unaudited)
Aggregate Face Expiration Unrealized
Total Value Value Date Depreciation
- -------------------------------------------------------------------------------------
Municipal Bond Index (long) $5,164,938 $5,234,502 Dec-99 $(69,564)
- -------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
<CAPTION>
Statement of assets and liabilities
September 30, 1999 (Unaudited)
<S> <C>
Assets
- -----------------------------------------------------------------------------------------------
Investment in securities at value
(identified cost $228,213,653) (Note 1) $232,970,941
- -----------------------------------------------------------------------------------------------
Cash 155,319
- -----------------------------------------------------------------------------------------------
Interest receivable 4,501,286
- -----------------------------------------------------------------------------------------------
Receivable for securities sold 40,000
- -----------------------------------------------------------------------------------------------
Receivable for variation margin 24,438
- -----------------------------------------------------------------------------------------------
Total assets 237,691,984
Liabilities
- -----------------------------------------------------------------------------------------------
Distributions payable to shareholders 1,063,071
- -----------------------------------------------------------------------------------------------
Payable for compensation of Manager (Note 2) 429,259
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Payable for investor servicing and custodian fees (Note 2) 25,659
- -----------------------------------------------------------------------------------------------
Payable for compensation of Trustees (Note 2) 12,460
- -----------------------------------------------------------------------------------------------
Payable for administrative services (Note 2) 1,608
- -----------------------------------------------------------------------------------------------
Other accrued expenses 51,786
- -----------------------------------------------------------------------------------------------
Total liabilities 1,583,843
- -----------------------------------------------------------------------------------------------
Net assets $236,108,141
Represented by
- -----------------------------------------------------------------------------------------------
Series A remarketed preferred shares, (8,000 shares authorized;
900 shares issued at $50,000 per share) (Note 4) $ 45,000,000
- -----------------------------------------------------------------------------------------------
Paid-in capital -- common shares (Note 1) 204,691,006
- -----------------------------------------------------------------------------------------------
Distributions in excess of net investment income (Note 1) (881,433)
- -----------------------------------------------------------------------------------------------
Accumulated net realized loss on investments (Note 1) (17,389,156)
- -----------------------------------------------------------------------------------------------
Net unrealized appreciation of investments 4,687,724
- -----------------------------------------------------------------------------------------------
Total -- Representing net assets applicable to
capital shares outstanding $236,108,141
Computation of net asset value
- -----------------------------------------------------------------------------------------------
Series A remarketed preferred shares $ 45,000,000
- -----------------------------------------------------------------------------------------------
Cumulative undeclared dividends on Series A
remarketed preferred shares 4,438
- -----------------------------------------------------------------------------------------------
Net assets allocated to Series A remarketed
preferred shares-liquidation preference $ 45,004,438
- -----------------------------------------------------------------------------------------------
Net assets available to common shares $191,103,703
- -----------------------------------------------------------------------------------------------
Net assets per common share
($191,103,703 divided by 22,148,029 shares) $8.63
- -----------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
<CAPTION>
Statement of operations
Six months ended September 30, 1999 (Unaudited)
<S> <C>
Investment income:
- -----------------------------------------------------------------------------------------------
Tax exempt interest income: $ 8,838,349
Expenses:
- -----------------------------------------------------------------------------------------------
Compensation of Manager (Note 2) 854,068
- -----------------------------------------------------------------------------------------------
Investor servicing and custodian fees (Note 2) 125,262
- -----------------------------------------------------------------------------------------------
Compensation of Trustees (Note 2) 6,459
- -----------------------------------------------------------------------------------------------
Administrative services (Note 2) 3,322
- -----------------------------------------------------------------------------------------------
Reports to shareholders 8,718
- -----------------------------------------------------------------------------------------------
Registration fees 75
- -----------------------------------------------------------------------------------------------
Auditing 75,528
- -----------------------------------------------------------------------------------------------
Legal 4,654
- -----------------------------------------------------------------------------------------------
Postage 21,746
- -----------------------------------------------------------------------------------------------
Preferred share remarketing agent fees 67,250
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Exchange listing fees 16,498
- -----------------------------------------------------------------------------------------------
Other 13,788
- -----------------------------------------------------------------------------------------------
Total expenses 1,197,368
- -----------------------------------------------------------------------------------------------
Expense reduction (Note 2) (18,287)
- -----------------------------------------------------------------------------------------------
Net expenses 1,179,081
- -----------------------------------------------------------------------------------------------
Net investment income 7,659,268
- -----------------------------------------------------------------------------------------------
Net realized gain on investments (Notes 1 and 3) 113,454
- -----------------------------------------------------------------------------------------------
Net realized loss on futures contracts (Note 1) (243,825)
- -----------------------------------------------------------------------------------------------
Net unrealized depreciation of investments and futures during the period (10,797,244)
- -----------------------------------------------------------------------------------------------
Net loss on investments (10,927,615)
- -----------------------------------------------------------------------------------------------
Net decrease in net assets resulting from operations $ (3,268,347)
- -----------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
<CAPTION>
Statement of changes in net assets
Six months ended Year ended
September 30 March 31
1999* 1999
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Decrease in net assets
- ---------------------------------------------------------------------------------------------------------------
Operations:
- ---------------------------------------------------------------------------------------------------------------
Net investment income $ 7,659,268 $ 15,567,072
- ---------------------------------------------------------------------------------------------------------------
Net realized loss on investments (130,371) (1,467,406)
- ---------------------------------------------------------------------------------------------------------------
Net unrealized depreciation of investments (10,797,244) (585,911)
- ---------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting
from operations (3,268,347) 13,513,755
- ---------------------------------------------------------------------------------------------------------------
Distributions to Series A remarketed preferred shareholders:
- ---------------------------------------------------------------------------------------------------------------
From net investment income: (744,561) (1,590,816)
- ---------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from
operations applicable to common shareholders (excluding
cumulative undeclared dividends on remarketed preferred
shares of $4,438 and $4,056, respectively) (4,012,908) 11,922,939
- ---------------------------------------------------------------------------------------------------------------
Distributions to common shareholders:
- ---------------------------------------------------------------------------------------------------------------
From net investment income: (7,417,908) (15,168,137)
- ---------------------------------------------------------------------------------------------------------------
Increase from issuance of common shares in
connection with reinvestment of distributions 856,065 1,864,602
- ---------------------------------------------------------------------------------------------------------------
Total decrease in net assets (10,574,751) (1,380,596)
Net assets
- ---------------------------------------------------------------------------------------------------------------
Beginning of period 246,682,892 248,063,488
- ---------------------------------------------------------------------------------------------------------------
End of period (including distributions in excess
of net investment income of $881,433 and
$378,232, respectively) $236,108,141 $246,682,892
- ---------------------------------------------------------------------------------------------------------------
Number of fund shares
- ---------------------------------------------------------------------------------------------------------------
Common shares outstanding at beginning of period 22,063,316 21,882,030
- ---------------------------------------------------------------------------------------------------------------
Shares issued in connection with reinvestment of distributions 84,713 181,286
- ---------------------------------------------------------------------------------------------------------------
Common shares outstanding at end of period 22,148,029 22,063,316
- ---------------------------------------------------------------------------------------------------------------
Remarketed preferred shares outstanding
at beginning and end of period 900 900
- ---------------------------------------------------------------------------------------------------------------
* Unaudited
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
<CAPTION>
Financial highlights
(For a share outstanding throughout the period)
- ------------------------------------------------------------------------------------------------------------------------------------
Six months
Per-share September 30
operating performance (Unaudited) Year ended March 31
- ------------------------------------------------------------------------------------------------------------------------------------
1999 1999 1998 1997 1996 1995
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of period
(common shares) $9.14 $9.28 $9.12 $9.16 $9.03 $9.23
- ------------------------------------------------------------------------------------------------------------------------------------
Investment operations
- ------------------------------------------------------------------------------------------------------------------------------------
Net investment income .35 .71 .75 .80 .80 .81
- ------------------------------------------------------------------------------------------------------------------------------------
Net realized and unrealized
gain (loss) on investments (.49) (.09) .18 (.08) .13 (.19)
- ------------------------------------------------------------------------------------------------------------------------------------
Total from
investment operations (.14) .62 .93 .72 .93 .62
- ------------------------------------------------------------------------------------------------------------------------------------
Less distributions:
- ------------------------------------------------------------------------------------------------------------------------------------
From net
investment income:
- ------------------------------------------------------------------------------------------------------------------------------------
To preferred shareholders (.03) (.07) (.08) (.07) (.08) (.07)
- ------------------------------------------------------------------------------------------------------------------------------------
To common shareholders (.34) (.69) (.69) (.69) (.72) (.75)
- ------------------------------------------------------------------------------------------------------------------------------------
Total distributions (.37) (.76) (.77) (.76) (.80) (.82)
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value,
end of period (common shares) $8.63 $9.14 $9.28 $9.12 $9.16 $9.03
- ------------------------------------------------------------------------------------------------------------------------------------
Market value,
end of period (common shares) $7.88 $10.94 $10.50 $10.25 $10.00 $9.50
- ------------------------------------------------------------------------------------------------------------------------------------
Ratios and supplemental data
- ------------------------------------------------------------------------------------------------------------------------------------
Total return at
market value (%)
(common shares)(a) (25.64)* 11.19 9.67 10.26 13.60 11.50
- ------------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period
(total fund) (in thousands) $236,108 $246,683 $248,063 $242,836 $241,599 $236,333
- ------------------------------------------------------------------------------------------------------------------------------------
Ratio of expenses to
average net assets (%)(b)(c) .61* 1.14 1.15 1.15 1.17 1.17
- ------------------------------------------------------------------------------------------------------------------------------------
Ratio of net investment income
to average net assets (%)(b) 3.51* 6.90 7.27 8.05 7.79 8.27
- ------------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover (%) 3.84* 6.92 16.78 9.30 34.45 49.11
- ------------------------------------------------------------------------------------------------------------------------------------
* Not annualized.
(a) Total return assumes dividend reinvestment and does not reflect the effect of sales charges.
(b) Ratios reflect net assets available to common shares only; net investment income ratio also reflects reduction for
dividend payments to preferred shareholders.
(c) The ratio of expenses to average net assets for the year ended March 31, 1996 and thereafter, includes amounts paid
through expense offset arrangements. Prior period ratios exclude these amounts (Note 2)
</TABLE>
Notes to financial statements
September 30, 1999 (Unaudited)
Note 1
Significant accounting policies
Putnam High Yield Municipal Trust (the "fund") is registered under the
Investment Company Act of 1940, as amended, as a diversified, closed-end
management investment company. The fund's investment objective is to seek
high current income exempt from federal income tax. The fund intends to
achieve its objective by investing in high yielding tax-exempt municipal
securities constituting a portfolio that the fund's Manager, Putnam
Investment Management, Inc., ("Putnam Management"), a wholly owned
subsidiary of Putnam Investments, Inc., believes to be consistent with
prudent investment management.
The following is a summary of significant accounting policies consistently
followed by the fund in the preparation of its financial statements. The
preparation of financial statements is in conformity with generally
accepted accounting principles and requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities
at the date of the financial statements and the reported amounts of
increases and decreases in net assets from operations during the reporting
period. Actual results could differ from those estimates.
A) Security valuation Tax-exempt bonds and notes are stated on the basis
of valuations provided by a pricing service, approved by the Trustees,
which uses information with respect to transactions in bonds, quotations
from bond dealers, market transactions in comparable securities and
various relationships between securities in determining value. The fair
value of restricted securities is determined by Putnam Management
following procedures approved by the Trustees, and such valuations and
procedures are reviewed periodically by the Trustees.
B) Security transactions and related investment income Security
transactions are accounted for on the trade date (date the order to buy or
sell is executed). Gains or losses on securities sold are determined on
the identified cost basis.
Interest income is recorded on the accrual basis.
C) Futures and options contracts The fund may use futures and options
contracts to hedge against changes in the values of securities the fund
owns or expects to purchase. The fund may also write options on securities
it owns or in which it may invest to increase its current returns.
The potential risk to the fund is that the change in value of futures and
options contracts may not correspond to the change in value of the hedged
instruments. In addition, losses may arise from changes in the value of
the underlying instruments, if there is an illiquid secondary market for
the contracts, or if the counterparty to the contract is unable to
perform. 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. Realized gains and
losses on purchased options are included in realized gains and losses on
investment securities.
Futures contracts are valued at the quoted daily settlement prices
established by the exchange on which they trade. Exchange traded options
are valued at the last sale price, or if no sales are reported, the last
bid price for purchased options and the last ask price for written
options. Options traded over-the-counter are valued using prices supplied
by dealers.
D) Federal taxes It is the policy of the fund to distribute all of its
income within the prescribed time and otherwise comply with the provisions
of the Internal Revenue Code applicable to regulated investment companies.
It is also the intention of the fund to distribute an amount sufficient to
avoid imposition of any excise tax under Section 4982 of the Internal
Revenue Code of 1986, as amended. Therefore, no provision has been made
for federal taxes on income, capital gains or unrealized appreciation on
securities held nor for excise tax on income and capital gains.
At March 31, 1999, the fund had a capital loss carryover of approximately
$16,283,000 available to offset future capital gains, if any. The amount
of the carryover and the expiration dates are:
Loss Carryover Expiration
- -------------- --------------
$3,134,000 March 31, 2003
1,309,000 March 31, 2004
7,979,000 March 31, 2006
3,861,000 March 31, 2007
E) Distributions to shareholders Distributions to common and preferred
shareholders are recorded by the fund on the ex-dividend date. Dividends
on remarketed preferred shares become payable when, as and if declared by
the Trustees. Each dividend period for the remarketed preferred shares is
generally a seven-day period. The applicable dividend rate for the
remarketed preferred shares on September 30, 1999 was 3.85%. The amount
and character of income and gains to be distributed are determined in
accordance with income tax regulations which may differ from generally
accepted accounting principles. Reclassifications are made to the fund's
capital accounts to reflect income and gains available for distribution
(or available capital loss carryovers) under income tax regulations.
F) Determination of net asset value Net asset value of the common shares
is determined by dividing the value of all assets of the fund, less all
liabilities and the liquidation preference of any outstanding remarketed
preferred shares, by the total number of common shares outstanding.
G) Amortization of bond premium and accretion of bond discount Any premium
resulting from the purchase of securities in excess of maturity value is
amortized on a yield-to-maturity basis. Discounts on zero coupon bonds,
original issue discount, stepped-coupon bonds and payment in kind bonds
are accreted according to the yield-to-maturity basis.
Note 2
Management fee, administrative
services and other transactions
Compensation of Putnam Management, for management and investment advisory
services is paid quarterly based on the average net assets of the fund.
Such fee is based on the annual rate of 0.70% of average weekly net
assets.
If dividends payable on remarketed preferred shares during any dividend
payment period plus any expenses attributable to remarketed preferred
shares for that period exceed the fund's gross income attributable to the
proceeds of the remarketed preferred shares during that period, then the
fee payable to Putnam Management for that period will be reduced by the
amount of the excess (but not more than 0.70% of the liquidation
preference of the remarketed preferred shares outstanding during the
period).
The fund reimburses Putnam Management an allocated amount for the
compensation and related expenses of certain officers of the fund and
their staff who provide administrative services to the fund. The aggregate
amount of all such reimbursements is determined annually by the Trustees.
Custodial functions for the fund's assets are provided by Putnam Fiduciary
Trust Company (PFTC), a subsidiary of Putnam Investments, Inc. Investor
servicing agent functions are provided by Putnam Investor Services, a
division of PFTC.
For the six months ended September 30, 1999, fund expenses were reduced by
$18,287 under expense offset arrangements with PFTC. Investor servicing
and custodian fees reported in the Statement of operations exclude these
credits. The fund could have invested a portion of the assets utilized in
connection with the expense offset arrangements in an income producing
asset if it had not entered into such arrangements.
Each Trustee of the fund receives an annual Trustee fee, of which $602 has
been allocated to the fund, and an additional fee for each Trustee's
meeting attended. Trustees who are not interested persons of Putnam
Management and who serve on committees of the Trustees receive additional
fees for attendance at certain committee meetings.
The fund has adopted a Trustee Fee Deferral Plan (the "Deferral Plan")
which allows the Trustees to defer the receipt of all or a portion of
Trustees Fees payable on or after July 1, 1995. The deferred fees remain
invested in certain Putnam funds until distribution in accordance with the
Deferral Plan.
The fund has adopted an unfunded noncontributory defined benefit pension
plan (the "Pension Plan") covering all Trustees of the fund who have
served as Trustee for at least five years. Benefits under the Pension Plan
are equal to 50% of the Trustee's average total retainer and meeting fees
for the three years preceding retirement. Pension expense for the fund is
included in Compensation of Trustees in the Statement of operations.
Accrued pension liability is included in Payable for compensation of
Trustees in the Statement of assets and liabilities.
Note 3
Purchases and sales of securities
During the six months ended September 30, 1999, cost of purchases and
proceeds from sales of investment securities other than short-term
investments aggregated $10,050,740 and $9,071,869, respectively. Purchases
and sales of short-term municipal obligations aggregated $29,600,000 and
$30,400,000 respectively.
Note 4
Remarketed preferred shares
The Series A shares are redeemable at the option of the fund on any
dividend payment date at a redemption price of $50,000 per share, plus an
amount equal to any dividends accumulated on a daily basis but unpaid
through the redemption date (whether or not such dividends have been
declared) and, in certain circumstances, a call premium.
It is anticipated that dividends paid to holders of remarketed preferred
shares will be considered tax-exempt dividends under the Internal Revenue
Code of 1986. To the extent that the fund earns taxable income and capital
gains by the conclusion of a fiscal year, it will be required to apportion
to the holders of the remarketed preferred shares throughout that year
additional dividends as necessary to result in an after-tax equivalent to
the applicable dividend rate for the period.
Under the Investment Company Act of 1940, the fund is required to maintain
asset coverage of at least 200% with respect to the remarketed preferred
shares as of the last business day of each month in which any such shares
are outstanding. Additionally, the fund is required to meet more stringent
asset coverage requirements under terms of the remarketed preferred shares
and the shares' rating agencies. Should these requirements not be met, or
should dividends accrued on the remarketed preferred shares not be paid,
the fund may be restricted in its ability to declare dividends to common
shareholders or may be required to redeem certain of the remarketed
preferred shares. At September 30, 1999, no such restrictions have been
placed on the fund.
Fund information
INVESTMENT MANAGER
Putnam Investment
Management, Inc.
One Post Office Square
Boston, MA 02109
MARKETING SERVICES
Putnam Mutual Funds Corp.
One Post Office Square
Boston, MA 02109
CUSTODIAN
Putnam Fiduciary Trust Company
LEGAL COUNSEL
Ropes & Gray
TRUSTEES
George Putnam, Chairman
William F. Pounds, Vice Chairman
John A. Hill, Vice Chairman
Jameson Adkins Baxter
Hans H. Estin
Ronald J. Jackson
Paul L. Joskow
Elizabeth T. Kennan
Lawrence J. Lasser
John H. Mullin III
Robert E. Patterson
George Putnam, III
A.J.C. Smith
W. Thomas Stephens
W. Nicholas Thorndike
OFFICERS
George Putnam
President
Charles E. Porter
Executive Vice President
Patricia C. Flaherty
Senior Vice President
John D. Hughes
Senior Vice President and Treasurer
Lawrence J. Lasser
Vice President
Gordon H. Silver
Vice President
Ian C. Ferguson
Vice President
Brett C. Browchuk
Vice President
Stephen Oristaglio
Vice President
Blake E. Anderson
Vice President and Fund Manager
Richard A. Monaghan
Vice President
John R. Verani
Vice President
Call 1-800-225-1581 weekdays from 9 a.m. to 5 p.m. Eastern Time, or visit
our Web site (www.putnaminv.com) any time for up-to-date information about
the fund's NAV.
[LOGO OMITTED]
PUTNAM INVESTMENTS
The Putnam Funds
One Post Office Square
Boston, Massachusetts 02109
- ---------------------
BULK RATE
U.S. POSTAGE PAID
PUTNAM
INVESTMENTS
- ---------------------
For account balances, economic forecasts, and the latest on Putnam funds, visit
www.putnaminv.com
56143 054 11/99
