NUVEEN Exchange-Traded Funds
April 30, 1999
Semiannual Report
Dependable, tax-free income to help you keep more of what you earn.
NQI
Insured Quality
NIO
Insured Opportunity
NIF
Premier Insured Income
NPX
Insured Premium Income 2
Photo of: People walking on beach.
<PAGE>
Highlights
As of April 30, 1999
Contents
1 Dear Shareholder
3 Portfolio Manager's Comments
6 NQI's Performance Overview
7 NIO's Performance Overview
8 NIF's Performance Overview
9 NPX's Performance Overview
10 Portfolio of Investments
37 Statement of Net Assets
38 Statement of Operations
39 Statement of Changes in Net Assets
41 Notes to Financial Statements
46 Financial Highlights
48 Building a Better Portfolio
49 Fund Information
Credit Quality Performance Highlights
Nuveen Insured Quality Municipal Fund, Inc. (NQI)
o Taxable-equivalent yield of 8.38% *
o Outperformed the total return of its Lipper
Peer Group and paralleled the total return
of the Lehman Brothers Insured Municipal
Bond Index **
Pie Chart:
Insured 78%
Insured and U.S. Guaranteed 20%
U.S. Guaranteed 2%
Nuveen Insured Municipal Opportunity Fund, Inc. (NIO)
o Taxable-equivalent yield of 8.45% *
o Stable tax-free dividend for 12 months
Pie Chart:
Insured 69%
Insured and U.S. Guaranteed 30%
U.S. Guaranteed 1%
Nuveen Premier Insured Municipal Income Fund, Inc.(NIF)
o Taxable-equivalent yield of 8.16% *
o Paralleled the total return performance of
its Lipper Peer Group **
Pie Chart:
Insured 65%
Insured and U.S. Guaranteed 20%
U.S. Guaranteed 15%
Nuveen Insured Premium Income Municipal Fund 2 (NPX)
o Taxable-equivalent yield of 8.01% *
o Outperformed the total return of its Lipper
Peer Group and the Lehman Brothers Insured
Municipal Bond Index **
Pie Chart:
Insured 86%
Insured and U.S. Guaranteed 14%
* For investors in the 31% federal income tax bracket. See your Fund's
Performance Overview for more information.
** The Lipper Peer Group return represents the average annualized returns of
the funds in the appropriate Lipper Municipal Debt category. The return
assumes reinvestment of dividends and does not reflect any applicable sales
charge.
The Lehman Brothers Insured Municipal Bond Index is an unleveraged index
covering a broad range of insured municipal bonds. The result for the index
does not reflect any initial or ongoing expenses.
<PAGE>
Photo of: Timothy R. Schwertfeger
Chairman of the Board
Sidebar text: Wealth takes a lifetime to build. Once achieved, it should be
preserved.
Dear Shareholder
I would like to take this opportunity to discuss the performance of your Nuveen
Exchange-Traded Fund over the past six months. Over this period, your Fund
continued to provide a stable, tax-free dividend while seeking to enhance its
after-tax total return. Capital preservation also remained an integral part of
the portfolio manager's strategies. The combination of these factors
demonstrates that Nuveen's municipal bond funds can serve as excellent
investment options for income-oriented investors.
The Year in Review
The past 6 to 12 months saw the U.S. economy continue its pattern of
non-inflationary growth, accompanied by low interest rates and unemployment
levels that remain among the lowest in three decades. Much of the current
economic growth is propelled by consumer demand, which has helped the U.S.
resist the downward pull of weaker overseas markets. All indications point to a
confident American consumer who is comfortable with the current state of the
economy, especially the performance of the housing, stock, and job markets. This
confidence is reflected in the most recent Consumer Confidence Index report
issued by the Conference Board, which showed a record-setting seventh
consecutive month of gains in May. On the global front, the turmoil of the past
two years appears to be fading somewhat, as international financial markets have
begun to recover.
Inflation in the U.S. continued to operate at benign levels, with an increase of
2.2% for the 12 months ended April 30, 1999. Despite a spike in consumer prices
in April, which was propelled by rising energy costs (which have subsequently
declined), the general backdrop of inflation indicators continued to be mild,
with the employment cost index, average hourly earnings, and import and producer
price trends all remaining favorable. As Federal Reserve Chairman Alan Greenspan
recently stated, one of the key factors in achieving today's peaceful
coexistence of economic growth and low inflation has been increased
productivity. Improvements in productivity, spurred by technological advances,
have been responsible for offsetting wage and other inflationary pressures that
we would normally expect to see as part of a growing economy.
On the interest rate front, last fall saw the Federal Reserve ease short-term
rates for the first time in almost three years. Between the end of September and
mid-November 1998, three successive cuts brought the federal funds rate to
4.75%, averting a potential domestic credit crunch and restoring some stability
to global markets. Following the success of these preemptive moves, the Federal
Reserve indicated that fighting inflation continued to be a top priority by
remaining in a proactive mode and responding to April's increased consumer
prices with a shift to a tightening bias. By doing this, the Fed signaled its
contin ued support of the market without changing interest rates or
fundamentally altering the economy. In the months ahead, we will continue to
watch for indications from theFed and other factors that affect the economy's
future, including wage and employment statistics, reports on productivity
growth, capital equipment spending, and the progress of international economic
recovery. We believe these key components will influence the outlook for
fixed-income markets well into the new millennium.
Municipal Bonds:
An Attractive Investment Option
As interest rates declined over the past year, our municipal bond funds
continued to provide bright spots among the various invest-ment options,
generally offering attractive, stable income in a market that places a high
premium on yield. In 1998, municipal bonds represented a reasonably insulated
haven in an otherwise turbulent market, with lower volatility relative to
Treasury bonds and other fixed-income investments. In fact, for the first four
months of 1999, municipals continued to outperform Treasuries.
<PAGE>
The high ratio of tax-exempt municipal yields to Treasury yields shel tered
municipal bonds from the price decline that occurred in the Treasury market
during the first four months of the year. While the interest rate on 30-year
Treasury bonds rose from 5.10% at the end of December to 5.66% as of April 30,
1999, the yield on the Bond Buyer Revenue Bond Index, an unmanaged index of
long-term municipal revenue bonds, gained just three basis points - from 5.26%
to 5.29%. Given the inverse relationship between interest rates and bond prices,
Treasury bond prices fell as rates rose over this period. Though municipal bond
prices did decrease, the decline was not as dramatic as the drop in Treasuries.
The differential in performance reflects the fact that Treasuries had become
relatively expensive as the result of safe-haven buying during the international
economic crises of the past year.
Line chart of: The Bond Buyer Revenue Bond Index
As the financial turmoil subsided in the first quarter of 1999, however, foreign
investors returned to investing in their own countries rather than in U.S.
dollar-denominated securities. The combination of an increase in interest rates
and a decline in demand caused U.S. Treasuries to drop in price.
At the end of April 1999, the ratio between long-term municipal yields and
30-year Treasury yields stood at 94%, compared with the historical average of
86% for the period of 1986-1999. For investors, this meant that quality
long-term municipal bonds offered yields comparable to those of long Treasury
bonds even before the tax advantages of municipal bonds were taken into account.
On an after-tax basis in today's market, municipal bonds continue to present an
exceptionally attractive investment option relative to Treasuries.
During 1998, lower interest rates and the strong economy combined to generate
high levels of new municipal issuance and a significant increase in the
refinancing of existing bonds. Municipal issuance in 1998 reached $284 billion,
up 29% over 1997. In terms of total municipal issuance, 1998 ranked as the
second largest year on record, next to 1993's $292 billion. In the first four
months of 1999, however, as the market settled into a more stable interest rate
environment, refunding activity dropped off dramatically. As a result, municipal
supply in 1999 has declined by approximately 25% from the levels of a year ago.
This, in turn, has enhanced the attractiveness of the munic ipal bonds that were
brought to market, as demand - especially from individual investorsremained
relatively strong.
The Value of Nuveen Expertise
The solid track record of a proven investment manager is one key to taking
advantage of the attractive values currently available in the municipal market.
The near-record level of municipal issuance in 1998, for example, highlighted
the value of Nuveen's in-depth knowledge of the municipal market, as our
portfolio management teams carefully analyzed each issue to select those
securities best suited to help the Funds achieve their investment objectives.
With the outlook for tighter supply and continued demand in 1999, Nuveen's
established market position ensures that we will have exceptional access to the
bond offerings that have the potential to add value for our shareholders.
As a further enhancement to our management capabilities, Nuveen has assembled a
strong group of investment managers - experts in their particular areas of the
market - to provide investors with the advantage of their experience and
insights. In addition to Nuveen Advisory Services for tax-free investing, you
and your financial adviser can rely on Institutional Capital Corporation for
value-oriented equity investing and Rittenhouse Financial Services, Inc. for
growth-oriented equity investing. We encourage you to talk with your financial
adviser about Nuveen's expanding array of investments and the ways that Nuveen
Funds can help you establish a diversified portfolio designed to build and
sustain long-term financial security. For more information on our funds, contact
your adviser for a prospectus, or call Nuveen at (800) 621-7227. Please read it
carefully before you invest or send money.
Thank you for the confidence you have placed in Nuveen. We are committed to
maintaining the trust you have shown in us, and we look forward to meeting your
investment needs well into the next century.
/s/ Timothy R. Schwertfeger
Timothy R. Schwertfeger
Chairman of the Board
June 15, 1999
Sidebar text: "The solid track record of a proven investment manager is one key
to taking advantage of the attractive values currently available in the
municipal market."
<PAGE>
Nuveen Exchange-Traded Funds
Portfolio Manager's Comments
Portfolio manager Steve Krupa discusses the municipal market environment,
fund performance, and the outlook for the Nuveen national insured
exchange-traded funds. Steve, who has served as portfolio manager for Insured
Quality and Insured Opportunity since their inceptions, assumed management
responsibilities for the Premier Insured Income Fund and the Insured Premium
Income Fund 2 on July 1, 1998, as part of Nuveen's efforts to maximize the
efficient use of staff resources and portfolio manager expertise. Steve is a
20-year veteran of Nuveen with more than 20 years of investment experience.
What factors have influenced the municipal market during the past 12 months?
Over the past 12 months, the U.S. economy continued to enjoy strong
non-inflationary growth, low interest rates, and low unemployment. With tax
revenues rising along with the growth in personal income, the national
government is generating a budget surplus, putting an end to 28 straight years
of federal budget deficits (1970-97). Over the past year, the
municipal-to-Treasury ratio ranged as high as 104%, offering investors in
quality long-term municipal bonds yields comparable to those of Treasury bonds,
even before the tax advantage of municipals was taken into account.
The other major story in the municipal market over the past 12 months was 1998
calendar year's impressive supply of new issuance. In the fourth quarter of
1998, investors saw $25-30 billion in new bonds brought to market each month.
Demand for municipal bonds also remained high, due to cash flow from
non-traditional investors as well as from the traditional buyers of mutual and
exchange-traded funds, such as individual investors and insurance companies. In
the first four months of 1999, however, there was a 25% drop-off in new issue
volume from 1998 levels. During this period, the continued demand from
individual investors compensated for lower demand from insurance companies,
which currently have fewer assets to invest due to heavy insurance premium price
competition and mounting claims from a series of devastating spring storms in
the Midwest and South.
For the remainder of 1999, the municipal market will be heavily influenced by
the direction of interest rates and inflation. If interest rates remain stable
or increase, we expect to see lower refinancing volume and a continuation of the
tighter supply scenario of the past four months. Demand should remain strong, as
individual investors look to diversify their portfolios by reallocating profits
from the equity market into fixed-income investments. These reallocation efforts
will be expanded if the volatility in equities continues. Even with lower supply
and high demand, Nuveen's position in the municipal market ensures that we will
have access to the best offerings in the marketplace.
How did the Funds perform over the past year?
For the 12 months ended April 30, 1999, the Funds produced total returns on net
asset value (NAV) ranging from 6.60% to 7.71%, providing taxable-equivalent
total returns of 9.39% to 10.17%, as shown in the accompanying table. For
comparison purposes, the total return on the Funds' benchmark - the Lehman
Brothers Insured Municipal Bond Index - and the average for the Lipper Insured
Leveraged Municipal Debt category are also provided.
1-Yr Ended Taxable-
4/30/99 Equivalent(3)
- ------------------------------------------------------
NQI
Total Return on NAV 7.13% 9.86%
Lehman Total Return(1) 7.22% N/A
Lipper Average(2) 7.09% N/A
Market Yield 5.78% 8.38%
- ------------------------------------------------------
NIO
Total Return on NAV 6.60% 9.39%
Lehman Total Return(1) 7.22% N/A
Lipper Average(2) 7.09% N/A
Market Yield 5.83% 8.45%
- ------------------------------------------------------
NIF
Total Return on NAV 6.94% 9.60%
Lehman Total Return(1) 7.22% N/A
Lipper Average(2) 7.09% N/A
Market Yield 5.63% 8.16%
- ------------------------------------------------------
NPX
Total Return on NAV 7.71% 10.17%
Lehman Total Return(1) 7.22% N/A
Lipper Average(2) 7.09% N/A
Market Yield 5.53% 8.01%
- ------------------------------------------------------
<PAGE>
1 The Funds are compared with the Lehman Brothers Insured Municipal Bond
Index, an unleveraged index covering a broad range of insured municipal
bonds. The return for the Lehman index does not reflect any initial or
ongoing expenses.
2 The Lipper Peer Group return represents the average annualized return of
funds in the Lipper Insured Leveraged Municipal Debt category. This return
assumes reinvestment of divi dends and does not reflect any applicable
sales charges.
3 Based on the 31% federal income tax rate.
<PAGE>
Over the past year, the yield on the Bond Buyer Revenue Bond Index, an unmanaged
index of long-term municipal revenue bonds, fell only 23 basis points, an
indication of a relatively stable interest rate climate. In this environment,
the Funds' durations (the measure of a bond fund's price volatility in response
to interest rate changes) played a smaller, though still significant role in
determining their returns relative to the market, as measured by the Lehman
insured index. NPX, which had the longest leverage-adjusted duration (10.52)
among these funds as of April 30, 1999, also had the best performance over the
past 12 months. In comparison, the duration of the unleveraged Lehman index was
8.42. Factors such as sector weightings and levels of call protection also had
an impact on the performance of each Fund.
How were the Funds' dividends and share prices affected?
Good call protection helped support the dividends of NQI, NIO, and NPX and
shield the income of these Funds from erosion. As of April 30, 1999, NPX had
provided 30 consecutive months of steady or increasing income, while NQI and NIO
had each provided shareholders with steady dividends for 12 straight months.
During the past year, lower interest rates led to an increased number of bond
calls, as issuers sought to reduce debt financing costs. In addition, declining
rates meant that proceeds from prepaid or matured bonds had to be reinvested in
issues paying relatively lower current rates. Both of these situations
contributed to a reduction in the income level of NIF and necessitated a
dividend cut in July 1998. Current market conditions indicate that NIF's
dividend should remain sustainable at its present level for the foreseeable
future. All of the Funds have continued to provide attractive market yields.
As interest rates declined, active demand for the national insured
exchange-traded funds resulted in solid share price performance. At the same
time, gains in the Funds' NAVs reflected gains in the overall bond market. As a
result of these factors, NIO saw its premium (share price over NAV) widen over
the past year, while the discount (share price below NAV) on NPX narrowed, and
both NQI and NIF moved from discounts to premiums.
4/30/98 4/30/99
- ------------------------------------------------------
NQI
Share Price ($) 15.4375 15.875
NAV$ 15.60 15.65
Premium/Discount to Nav(4) -1.04% 1.44%
1-Yr Ended Taxable-
4/30/99 Equivalent(3)
- ------------------------------------------------------
Total Return on Share Price 9.81% 12.56%
- ------------------------------------------------------
NIO
Share Price ($) 15.9375 16.25
NAV$ 15.68 15.71
Premium/Discount to Nav(4) 1.64% 3.44%
1-Yr Ended Taxable-
4/30/99 Equivalent(3)
- ------------------------------------------------------
Total Return on Share Price 8.31% 11.06%
- ------------------------------------------------------
NIF
Share Price ($) 15.625 16.00
NAV$ 15.74 15.87
Premium/Discount to Nav(4) -0.73% 0.82%
1-Yr Ended Taxable-
4/30/99 Equivalent(3)
- ------------------------------------------------------
Total Return on Share Price 8.55% 11.22%
- ------------------------------------------------------
NPX
Share Price ($) 12.625 13.125
NAV$ 13.61 13.92
Premium/Discount to Nav(4) -7.24% -5.71%
1-Yr Ended Taxable-
4/30/99 Equivalent(3)
- ------------------------------------------------------
Total Return on Share Price 9.72% 12.37%
- ------------------------------------------------------
For additional information, see the individual Performance Overview for your
fund in this report.
What key strategies were used to manage the Funds during the past year?
Over the past year, the Funds offered the benefit of insulation from the
volatility experienced by other markets, enhanced by dependable tax-free income.
The focus of our management strategies for these Funds contin ued to be on
supporting the highest level of tax-exempt dividends consistent with capital
preservation.
3 Based on the 31% federal income tax rate.
4 A fund's premium or discount represents the difference between the fund's
share price and its NAV.
<PAGE>
During the 12 months ended April 1999, several sectors offered opportunities to
add value and enhance the Funds' call protection and portfolio structure. These
included the utilities sector, where deregulation and abundant new supply -
boosted by the record-setting $7 billion Long Island Power Authority offering -
provided increased opportunities to find the types of bonds that can help us
achieve our goals for these Funds. We also found opportunities in bonds issued
by the healthcare sector, specifically hospitals, which continue to undergo
pressure from health management systems and the federal government. In
transportation, the ongoing demand for larger facilities resulted in a good
supply of airport bonds, including those issued by O'Hare International and
Midway airports in Chicago. The continued growth of this industry makes airport
bonds one of our favorite groups. As interest rates trended lower during the
fourth quarter of 1998, several issuers took the opportunity to advance refund
bonds, and all of these Funds benefited from the price appreciation that
resulted from this event.
In the area of call protection, NQI and NIO continue to offer good levels of
protection over the next two years, as less than 9% of each portfolio is subject
to calls before 2001. With virtually no scheduled bond calls until 2002, both
NIF and NPX currently offer outstanding call protection, which should provide
additional stability for their dividends over this period. Beginning in 2002,
however, these Funds will enter the normal part of the bond cycle in which bond
calls are more likely to occur. To minimize the impact of future bond calls, we
are already at work on strategies for managing through the upcoming period. One
such strategy involves selling callable bonds before their scheduled call dates
and reinvesting the proceeds at the long end of the yield curve to take
advantage of current yields. Nuveen's excellent surveillance and research help
us properly evaluate each issue so that we can find and maximize selling and
reinvestment opportunities. These buy/sell deci sions can benefit the Funds by
adding asset value and increasing the potential for earning income.
What is Nuveen's outlook for the Funds' future?
Looking ahead for the Nuveen national insured funds, our focus will continue to
be on supporting the income streams of these Funds. Our strategies will include
repositioning assets by investing in bonds found on the long end of the yield
curve to move the Funds' durations to a more market-neutral position and boost
both income and total return potential. We will also continue to reinvest any
bond call proceeds in the most advantageous manner possible. The success ful
execution of these strategies demonstrates the value that can be added by an
active bond manager such as Nuveen. As an experienced investment manager
knowledgeable about the unique aspects of the municipal market, we are in the
marketplace every day, monitoring market dynamics, looking for opportunities,
and capitalizing on them to the benefit of shareholders.
In our opinion, municipal bonds are currently one of the most compelling values
in the investment marketplace. Over the past 12 months, the value of these
quality investments has been enhanced by excellent municipal-to-Treasury ratios
as well as a market environment characterized by low interest rates and benign
inflation. With continued volatility in the equity markets and investors'
increasing awareness of the need for asset allocation rebalancing, the demand
for municipal bond funds is expected to grow. We believe that investors who take
advantage of current opportunities in the municipal market should be rewarded
with healthy returns and attractive yields in the months ahead.
<PAGE>
Nuveen Insured Quality Municipal Fund, Inc.
Performance Overview
As of April 30, 1999
NQI
Portfolio Statistics
Inception Date 12/90
- --------------------------------------------------
Share Price $15 7/8
- --------------------------------------------------
Net Asset Value $15.65
- --------------------------------------------------
Market Yield 5.78%
- --------------------------------------------------
Taxable-Equivalent Yield (Federal Only)(1) 8.38%
- --------------------------------------------------
Fund Net Assets ($000) $851,297
- --------------------------------------------------
Effective Maturity (Years) 19.69
- --------------------------------------------------
Leverage-Adjusted Duration 8.75
- --------------------------------------------------
Annualized Total Return
On Share Price On NAV
- --------------------------------------------------
1-Year 9.81% 7.13%
- --------------------------------------------------
5-Year 9.02% 7.67%
- --------------------------------------------------
Since Inception 7.65% 8.37%
- --------------------------------------------------
Taxable-Equivalent Total Return(2)
On Share Price On NAV
- --------------------------------------------------
1-Year 12.56% 9.86%
- --------------------------------------------------
5-Year 12.05% 10.64%
- --------------------------------------------------
Since Inception 10.68% 11.42%
- --------------------------------------------------
Top Five Sectors (as a % of total investments)
U.S. Guaranteed 22%
- --------------------------------------------------
Utilities 17%
- --------------------------------------------------
Healthcare 16%
- --------------------------------------------------
Housing/Single Family 11%
- --------------------------------------------------
Transportation 11%
- --------------------------------------------------
1 Taxable-equivalent yield represents the yield on a taxable investment
necessary to equal the yield of the Nuveen fund on an after-tax basis. The
federal only rate is based on the current market yield and a federal income
tax rate of 31%.
2 Taxable-equivalent total return is based on the annualized total return and
a federal income tax rate of 31%. It represents the return on a taxable
investment necessary to equal the return of the Nuveen fund on an after-tax
basis.
3 The Fund also paid shareholders capital gains and net ordinary income
distributions in December of $0.1261 and $0.0001, respectively, per share.
Bar Chart:
1998-1999 Monthly Tax-Free Dividends Per Share(3)
5/98 0.0765
6/98 0.0765
7/98 0.0765
8/98 0.0765
9/98 0.0765
10/98 0.0765
11/98 0.0765
12/98 0.0765
1/99 0.0765
2/99 0.0765
3/99 0.0765
4/99 0.0765
Line Chart:
Share Price Performance
5/1/98 15.313
15.25
15.375
15.625
15.813
16
15.75
15.563
15.813
15.938
15.813
16
15.875
15.688
15.625
15.688
15.688
15.625
15.375
15.438
15.5
15.875
15.875
16.125
15.63
15.63
15.75
15.94
15.94
16.38
16.13
15.94
16.06
16
15.69
15.5
15.44
15.63
15.56
15.75
15.75
16
15.94
16
16
16
15.81
15.88
4/30/99 15.88
Weekly Closing Price
Past performance is not predictive of future results.
<PAGE>
Nuveen Insured Municipal Opportunity Fund, Inc.
Performance Overview
As of April 30, 1999
NIO
Portfolio Statistics
Inception Date 9/91
- --------------------------------------------------
Share Price $16 1/4
- --------------------------------------------------
Net Asset Value $15.71
- --------------------------------------------------
Market Yield 5.83%
- --------------------------------------------------
Taxable-Equivalent Yield (Federal Only)(1) 8.45%
- --------------------------------------------------
Fund Net Assets ($000) $1,951,736
- --------------------------------------------------
Effective Maturity (Years) 17.94
- --------------------------------------------------
Leverage-Adjusted Duration 8.63
- --------------------------------------------------
Annualized Total Return
On Share Price On NAV
- --------------------------------------------------
1-Year 8.31% 6.60%
- --------------------------------------------------
5-Year 9.83% 8.02%
- --------------------------------------------------
Since Inception 7.76% 8.15%
- --------------------------------------------------
Taxable-Equivalent Total Return(2)
On Share Price On NAV
- --------------------------------------------------
1-Year 11.06% 9.39%
- --------------------------------------------------
5-Year 12.89% 11.02%
- --------------------------------------------------
Since Inception 10.75% 11.11%
- --------------------------------------------------
Top Five Sectors (as a % of total investments)
U.S. Guaranteed 31%
- --------------------------------------------------
Healthcare 17%
- --------------------------------------------------
Utilities 15%
- --------------------------------------------------
Housing/Single Family 11%
- --------------------------------------------------
Transportation 9%
- --------------------------------------------------
1 Taxable-equivalent yield represents the yield on a taxable investment
necessary to equal the yield of the Nuveen fund on an after-tax basis. The
federal only rate is based on the current market yield and a federal income
tax rate of 31%.
2 Taxable-equivalent total return is based on the annualized total return and
a federal income tax rate of 31%. It represents the return on a taxable
investment necessary to equal the return of the Nuveen fund on an after-tax
basis.
3 The Fund also paid shareholders capital gains distributions in December of
$0.0405 per share.
Bar Chart:
1998-1999 Monthly Tax-Free Dividends Per Share(3)
5/98 0.079
6/98 0.079
7/98 0.079
8/98 0.079
9/98 0.079
10/98 0.079
11/98 0.079
12/98 0.079
1/99 0.079
2/99 0.079
3/99 0.079
4/99 0.079
Line Chart:
Share Price Performance
5/1/98 15.813
15.563
15.688
15.813
16.063
16.125
16.063
16.063
16.125
16.313
16.188
15.938
15.938
16
16
16.188
16.125
16.125
16.063
16.063
16.125
16.563
16.625
16.875
16.56
16.63
16.75
16.94
16.75
16.88
16.75
16.63
16.5
16.38
16.38
16.25
16.38
16.75
16.63
16.5
16.44
16.56
16.63
16.5
16.5
16.5
16.06
16.13
4/30/99 16.25
Weekly Closing Price
Past performance is not predictive of future results.
<PAGE>
Nuveen Premier Insured Municipal Income Fund, Inc.
Performance Overview
As of April 30, 1999
NIF
Portfolio Statistics
Inception Date 12/91
- --------------------------------------------------
Share Price $16
- --------------------------------------------------
Net Asset Value $15.87
- --------------------------------------------------
Market Yield 5.63%
- --------------------------------------------------
Taxable-Equivalent Yield (Federal Only)(1) 8.16%
- --------------------------------------------------
Fund Net Assets ($000) $445,649
- --------------------------------------------------
Effective Maturity (Years) 17.22
- --------------------------------------------------
Leverage-Adjusted Duration 9.42
- --------------------------------------------------
Annualized Total Return
On Share Price On NAV
- --------------------------------------------------
1-Year 8.55% 6.94%
- --------------------------------------------------
5-Year 9.15% 7.87%
- --------------------------------------------------
Since Inception 7.23% 7.93%
- --------------------------------------------------
Taxable-Equivalent Total Return(2)
On Share Price On NAV
- --------------------------------------------------
1-Year 11.22% 9.60%
- --------------------------------------------------
5-Year 12.12% 10.71%
- --------------------------------------------------
Since Inception 10.10% 10.74%
- --------------------------------------------------
Top Five Sectors (as a % of total investments)
U.S. Guaranteed 35%
- --------------------------------------------------
Utilities 17%
- --------------------------------------------------
Tax Obligation/Limited 16%
- --------------------------------------------------
Healthcare 11%
- --------------------------------------------------
Housing/Multifamily 5%
- --------------------------------------------------
1 Taxable-equivalent yield represents the yield on a taxable investment
necessary to equal the yield of the Nuveen fund on an after-tax basis. The
federal only rate is based on the current market yield and a federal income
tax rate of 31%.
2 Taxable-equivalent total return is based on the annualized total return and
a federal income tax rate of 31%. It represents the return on a taxable
investment necessary to equal the return of the Nuveen fund on an after-tax
basis.
3 The Fund also paid shareholders capital gains distributions in December of
$0.0402 per share.
Bar Chart:
1998-1999 Monthly Tax-Free Dividends Per Share(3)
5/98 0.078
6/98 0.078
7/98 0.075
8/98 0.075
9/98 0.075
10/98 0.075
11/98 0.075
12/98 0.075
1/99 0.075
2/99 0.075
3/99 0.075
4/99 0.075
Line Chart:
Share Price Performance
5/1/98 15.813
15.875
15.688
15.75
15.938
16.063
15.875
15.875
16.125
16.063
15.875
15.75
15.688
15.75
15.813
15.938
15.938
15.938
15.938
16.063
16
16.688
16.5
16.5
16.69
16.88
16.69
16.5
16.44
16.5
16.44
16.44
16.44
16.31
16.06
16.06
16.19
16.44
16.5
16.5
16.44
16.44
16.19
16.06
16.06
16.13
15.63
15.75
4/30/99 16
<PAGE>
Nuveen Insured Premium Income Municipal Fund 2
Performance Overview
As of April 30, 1999
NPX
Portfolio Statistics
Inception Date 7/93
- --------------------------------------------------
Share Price $13 1/8
- --------------------------------------------------
Net Asset Value $13.92
- --------------------------------------------------
Market Yield 5.53%
- --------------------------------------------------
Taxable-Equivalent Yield (Federal Only)(1) 8.01%
- --------------------------------------------------
Fund Net Assets ($000) $787,424
- --------------------------------------------------
Effective Maturity (Years) 17.40
- --------------------------------------------------
Leverage-Adjusted Duration 10.52
- --------------------------------------------------
Annualized Total Return
On Share Price On NAV
- --------------------------------------------------
1-Year 9.72% 7.71%
- --------------------------------------------------
5-Year 9.89% 8.89%
- --------------------------------------------------
Since Inception 3.65% 5.45%
- --------------------------------------------------
Taxable-Equivalent Total Return(2)
On Share Price On NAV
- --------------------------------------------------
1-Year 12.37% 10.17%
- --------------------------------------------------
5-Year 12.87% 11.57%
- --------------------------------------------------
Since Inception 6.40% 8.00%
- --------------------------------------------------
Top Five Sectors (as a % of total investments)
Utilities 23%
- --------------------------------------------------
Tax Obligation/General 17%
- --------------------------------------------------
U.S. Guaranteed 14%
- --------------------------------------------------
Healthcare 10%
- --------------------------------------------------
Transportation 9%
- --------------------------------------------------
1 Taxable-equivalent yield represents the yield on a taxable investment
necessary to equal the yield of the Nuveen fund on an after-tax basis. The
federal only rate is based on the current market yield and a federal income
tax rate of 31%.
2 Taxable-equivalent total return is based on the annualized total return and
a federal income tax rate of 31%. It represents the return on a taxable
investment necessary to equal the return of the Nuveen fund on an after-tax
basis.
Bar Chart:
1998-1999 Monthly Tax-Free Dividends Per Share
5/98 0.0605
6/98 0.0605
7/98 0.0605
8/98 0.0605
9/98 0.0605
10/98 0.0605
11/98 0.0605
12/98 0.0605
1/99 0.0605
2/99 0.0605
3/99 0.0605
4/99 0.0605
Line Chart:
Share Price Performance
5/1/98 12.688
12.625
12.688
12.813
13
12.938
13.063
12.875
12.813
13.063
12.938
12.875
13
13.125
12.875
12.938
13.063
12.938
13.063
13.188
13.313
13.563
13.563
13.625
13.75
13.69
13.69
13.69
13.94
13.81
13.94
13.88
13.81
13.69
13.38
13.25
13.5
13.25
13.31
13.31
13.44
13.56
13.44
13.38
13.69
13.38
13.13
13.13
4/30/99 13.13
Weekly Closing Price
Past performance is not predictive of future results.
<PAGE>
<TABLE>
Portfolio of Investments
Nuveen Insured Quality Municipal Fund, Inc. (NQI)
April 30, 1999
(Unaudited)
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Alabama - 3.1%
$ 8,500,000 The Special Care Facilities Financing Authority of the City of 7/99 at 100 AAA $ 8,528,560
Birmingham-Medical Center East, Health Care Facility Revenue
Refunding Bonds, Series 1986, 7.250%, 7/01/15
12,250,000 Jefferson County, Alabama, Sewer Revenue Capital Improvement 2/09 at 101 AAA 11,984,543
Warrants, Series 1999-A, 5.125%, 2/01/39
University of South Alabama, Tuition Revenue Bonds, Series 1999:
7,545,000 0.000%, 11/15/17 No Opt. Call AAA 2,928,441
7,545,000 0.000%, 11/15/18 No Opt. Call AAA 2,756,339
- ------------------------------------------------------------------------------------------------------------------------------------
Alaska - 0.6%
5,000,000 Municipality of Anchorage, Alaska, Senior Lien Refunding Electric 6/99 at 102 AAA 5,115,100
Revenue Bonds, Series 1989, 7.125%, 6/01/06
- ------------------------------------------------------------------------------------------------------------------------------------
Arizona - 5.2%
5,000,000 City of Phoenix (Arizona), Civic Improvement Corporation, 7/03 at 102 AAA 5,538,750
Wastewater System Lease Revenue Bonds, Series 1993, 6.125%, 7/01/23
(Pre-refunded to 7/01/03)
10,000,000 Industrial Development Authority of The County of Pima (Arizona), 7/01 at 102 AAA 10,772,800
Health Care System Revenue Bonds, Carondelet Health Services, Inc.,
St. Joseph's and St. Mary's Hospitals and Health Centers Issue,
Series 1991, 6.750%, 7/01/16
Business Development Finance Corporation, Tucson (Arizona),
Local Development Lease Revenue Refunding Bonds, Series 1992:
3,020,000 6.250%, 7/01/08 (Pre-refunded to 7/01/02) 7/02 at 102 AAA 3,307,142
6,980,000 6.250%, 7/01/08 7/02 at 102 AAA 7,605,199
15,250,000 City of Tucson (Arizona), Water System Revenue Bonds, Series 1991, 7/01 at 102 AAA 16,644,613
7.100%, 7/01/18 (Pre-refunded to 7/01/01)
- ------------------------------------------------------------------------------------------------------------------------------------
Arkansas - 2.3%
9,450,000 Arkansas Development Finance Authority, Single Family Mortgage 7/05 at 102 AAA 10,175,949
Revenue Bonds, 1995 Series B (Mortgage-Backed Securities Program),
6.700%, 7/01/27 (Alternative Minimum Tax)
Pope County, Arkansas, Solid Waste Disposal Revenue Bonds,
Series 1991 (Arkansas Power and Light Company Project):
6,400,000 8.000%, 1/01/21 (Alternative Minimum Tax) 1/01 at 102 BBB+ 6,828,288
2,250,000 8.000%, 1/01/21 (Alternative Minimum Tax) 1/01 at 102 AAA 2,435,310
- ------------------------------------------------------------------------------------------------------------------------------------
California - 10.3%
9,650,000 Certificates of Participation (1991 Financing Project), 9/06 at 102 AAA 10,585,857
County of Alameda, California, Alameda County Public Facilities
Corporation, 6.000%, 9/01/21
12,695,000 Antioch Area Public Facilities Financing Agency, Community 8/02 at 102 AAA 12,670,626
Facilities District No. 1989-1, Series 1993 Special Tax Bonds,
5.000%, 8/01/18
8,500,000 California Health Facilities Financing Authority, Insured 8/08 at 101 AAA 8,280,190
Revenue Bonds (Sutter Health), Series 1998A, 5.000%, 8/15/37
California Housing Finance Agency, Home Mortgage Revenue Bonds,
1997 Series E:
3,000,000 5.650%, 8/01/17 (Alternative Minimum Tax) 8/07 at 102 AAA 3,125,340
14,075,000 5.750%, 2/01/29 (Alternative Minimum Tax) 8/07 at 102 AAA 14,694,300
5,500,000 California Statewide Communities Development Authority, 7/04 at 102 AAA 6,085,255
Certificates of Participation, The Slake Institute for
Biological Studies, San Diego, California, 6.200%, 7/01/24
5,000,000 Inland Empire Solid Waste Financing Authority, Revenue Bonds, 8/06 at 102 AAA 5,452,000
1996 Series B (Landfill Improvement Financing Project),
6.000%, 8/01/16 (Alternative Minimum Tax)
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
California (continued)
$ 11,270,000 Los Angeles County Metropolitan Transportation Authority, 7/03 at 100 AAA $ 11,098,471
California, Proposition A, Sales Tax Revenue Refunding Bonds,
Series 1993-A, 5.000%, 7/01/21
6,910,000 Ontario Redevelopment Financing Authority, San Bernardino County, 8/03 at 102 AAA 7,553,805
California, 1993 Revenue Bonds (Ontario Redevelopment Project No. 1),
5.850%, 8/01/22
8,500,000 Airports Commission, City and County of San Francisco, 5/05 at 101 AAA 9,337,590
California, San Francisco International Airport, Second Series
Revenue Bonds, Issue 11 (Noise Insulation Program),
6.250%, 5/01/26 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Colorado - 6.6%
1,060,000 Adams County, Colorado, Single Family Revenue Refunding Bonds, 6/01 at 103 AAA 1,133,744
1991 Series A-2, 8.700%, 6/01/12
5,630,000 E-470 Public Highway Authority, Arapaho County, Colorado, Capital 8/05 at 103 AAA 6,265,683
Improvement Trust Fund Highway Revenue Bonds (E-470 Project),
Vehicle Registration Fee Bonds, 6.150%, 8/31/26
Colorado Health Facilities Authority, Insured Hospital Revenue
Bonds (PSL Healthcare System Project), Series 1991A:
5,000,000 7.250%, 2/15/16 (Pre-refunded to 2/15/01) 2/01 at 102 AAA 5,408,250
4,500,000 6.250%, 2/15/21 (Pre-refunded to 2/15/01) 2/01 at 102 AAA 4,791,690
6,500,000 Colorado Health Facilities Authority, Revenue Bonds, Series 1998 6/08 at 101 AAA 6,354,790
(Sisters of Charity of Leavenworth Health Services Corporation),
5.000%, 12/01/25
City and County of Denver, Colorado, Airport System Revenue Bonds,
Series 1998B:
20,250,000 5.000%, 11/15/25 (Alternative Minimum Tax) 11/08 at 101 AAA 19,514,925
12,000,000 5.000%, 11/15/25 11/08 at 101 AAA 11,749,320
115,000 El Paso County, Colorado, Colorado Local Single Family Mortgage 9/00 at 102 AAA 119,341
Revenue Bonds, 1990 Series A, 7.850%, 9/01/09
(Alternative Minimum Tax)
655,000 Jefferson County, Colorado, Single Family Revenue Refunding Bonds, 4/01 at 103 AAA 693,783
Series 1991A, 8.875%, 10/01/13
- ------------------------------------------------------------------------------------------------------------------------------------
Florida - 1.2%
9,395,000 Florida Housing Finance Agency, Single Family Mortgage Revenue 7/04 at 102 AAA 10,020,801
Bonds, 1994 Series B, 6.650%, 7/01/26 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Hawaii - 2.9%
6,130,000 Department of Budget and Finance of the State of Hawaii, Special 12/02 at 102 AAA 6,720,013
Purpose Revenue Bonds (Hawaiian Electric Company, Inc. and
Subsidiaries Projects), Series 1992, 6.550%, 12/01/22
(Alternative Minimum Tax)
16,180,000 Department of Budget and Finance of the State of Hawaii, Special 5/06 at 101 AAA 17,766,449
Purpose Revenue Bonds (Hawaii Electric Company, Inc. and Subsidiaries
Project), Series 1996A, 6.200%, 5/01/26 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Illinois - 11.2%
5,000,000 Central Lake County Joint Action Water Agency, Lake County, 5/01 at 102 AAA 5,423,350
Illinois, Water Revenue Bonds, Series 1991, 7.000%, 5/01/20
(Pre-refunded to 5/01/01)
10,000,000 City of Chicago, General Obligation Bonds, Project Series 1995, 7/05 at 102 AAA 11,304,700
6.125%, 1/01/16 (Pre-refunded to 7/01/05)
Chicago School Reform Board of Trustees of the Board of Education
of the City of Chicago, Illinois, Unlimited Tax General Obligation Bonds
(Dedicated Tax Revenues), Series 1997A:
20,000,000 5.250%, 12/01/27 12/07 at 102 AAA 19,984,400
10,000,000 5.250%, 12/01/30 12/07 at 102 AAA 9,976,500
6,000,000 City of Chicago, Illinois, Chicago-O'Hare International Airport, 1/05 at 102 AAA 6,658,200
General Airport Second Lien Revenue Refunding Bonds,
1994 Series A, 6.375%, 1/01/12
6,280,000 Public Building Commission of Chicago, Illinois, Building Revenue 1/00 at 102 AAA 6,649,390
Bonds, Series A of 1990 (Board of Education of the City of Chicago),
7.125%, 1/01/15
6,825,000 Public Building Commission of Chicago, Illinois, Building 12/03 at 102 AAA 7,509,206
Revenue Bonds, Series A of 1993 (Board of Education of the City
of Chicago), 5.750%, 12/01/18 (Pre-refunded to 12/01/03)
18,880,000 Illinois Health Facilities Authority, FHA-Insured Mortgage Revenue 2/06 at 102 AAA 20,201,222
Bonds, Series 1996 (Sinai Health System), 6.000%, 2/15/24
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Illinois (continued)
$ 260,000 City of Moline, Illinois, City of Rock Island, Illinois, 8/00 at 102 AAA $ 270,078
City of Urbana, Illinois, Single Family Mortgage Revenue Bonds (GNMA
Mortgage-Backed Securities Program), Series 1990, 8.050%, 8/01/23
(Alternative Minimum Tax)
7,700,000 Board of Trustees of Southern Illinois University, Southern 4/07 at 102 AAA 8,282,043
Illinois University Medical Facilities System Revenue Bonds, Series 1997,
5.875%, 4/01/23
- ------------------------------------------------------------------------------------------------------------------------------------
Indiana - 5.6%
9,050,000 Indiana Development Finance Authority, Environmental Revenue 2/03 at 102 AAA 9,379,963
Bonds, Series 1993B (PSI Energy, Inc.), 5.750%, 2/15/28
(Alternative Minimum Tax)
5,805,000 Indiana Housing Finance Authority, Single Family Mortgage 7/00 at 102 Aaa 6,025,590
Revenue Bonds (GNMA Collateralized Home Mortgage Program),
1990 Series C, 7.800%, 1/01/22 (Alternative Minimum Tax)
6,000,000 Jasper County, Indiana, Collateralized Pollution Control Refunding 7/01 at 102 AAA 6,490,560
Revenue Bonds (Northern Indiana Public Service Company Project),
Series 1991, 7.100%, 7/01/17
9,645,000 Marion County Convention and Recreational Facilities Authority, 6/01 at 102 AAA 10,482,090
Indiana, Excise Taxes Lease Rental Revenue Bonds, Series 1991B,
7.000%, 6/01/21 (Pre-refunded to 6/01/01)
4,230,000 City of Rockport, Indiana, Pollution Control Revenue Refunding 3/01 at 102 AAA 4,576,818
Bonds (Indiana Michigan Power Company Project), Series B,
7.600%, 3/01/16
10,000,000 Hospital Authority of St. Joseph County, Indiana, Fixed Rate 8/01 at 102 AAA 10,921,600
Hospital Revenue Refunding Bonds, Series 1991A (Memorial Hospital
of South Bend Project), 7.000%, 8/15/20 (Pre-refunded to 8/15/01)
- ------------------------------------------------------------------------------------------------------------------------------------
Iowa - 0.7%
5,305,000 City of Mason City, Iowa, Hospital Revenue Bonds (Sisters of 8/01 at 102 AAA 5,796,349
Mercy Health Corporation), 1991 Series L, 7.000%, 8/15/21
(Pre-refunded to 8/15/01)
- ------------------------------------------------------------------------------------------------------------------------------------
Louisiana - 2.4%
13,170,000 City of New Orleans, Louisiana, General Obligation Refunding 10/05 at 101 AAA 14,609,613
Bonds, Series 1995, 6.200%, 10/01/21
5,275,000 Orleans Levee District (A Political Subdivision of the State of 12/05 at 103 AAA 5,742,471
Louisiana), Public Improvement Bonds, Series 1986, 5.950%, 11/01/15
- ------------------------------------------------------------------------------------------------------------------------------------
Maine - 1.5%
12,320,000 Maine State Housing Authority, Mortgage Purchase Bonds, 5/01 at 102 AAA 12,969,264
1991 Series A, 7.400%, 11/15/22
- ------------------------------------------------------------------------------------------------------------------------------------
Massachusetts - 3.5%
7,100,000 Massachusetts Housing Financing Agency, Single Family Housing 6/99 at 102 AAA 7,313,355
Revenue Bonds, Series 12, 7.500%, 12/01/13
23,500,000 Massachusetts Turnpike Authority, Metropolitan Highway System 1/07 at 102 AAA 22,445,555
Revenue Bonds, 1997 Series C (Senior), 5.000%, 1/01/37
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan - 2.4%
4,380,000 Board of Control of Grand Valley State University, Michigan, 10/07 at 101 AAA 4,413,814
General Revenue and Refunding Bonds, Series 1997, 5.250%, 10/01/22
16,500,000 Michigan State Hospital Finance Authority, Revenue and Refunding 5/08 at 101 AAA 15,795,945
Bonds (St. John Health System), Series 1998A, 5.000%, 5/15/28
- ------------------------------------------------------------------------------------------------------------------------------------
Minnesota - 1.1%
7,825,000 Minneapolis/Saint Paul Housing Finance Board, Single Family 8/99 at 101 AAA 7,999,419
Mortgage Revenue Bonds (Minneapolis/Saint Paul Family Housing
Program, Phase VI) (Alternative Minimum Tax)
1,004,000 City of St. Louis Park, Minnesota, Single Family Residential 4/01 at 102 Aaa 1,050,596
Mortgage Revenue Refunding Bonds (GNMA Mortgage-Backed Securities
Program), Series 1991-A, 7.250%, 4/20/23
- ------------------------------------------------------------------------------------------------------------------------------------
Mississippi - 2.5%
2,545,000 Harrison County, Wastewater Management District (Mississippi), No Opt. Call AAA 3,505,101
Wastewater Treatment Facilities Revenue Refunding Bonds,
Series 1991A, 8.500%, 2/01/13
2,715,000 Harrison County, Wastewater Management District (Mississippi), No Opt. Call AAA 3,570,877
Wastewater Treatment Facilities Revenue Refunding Bonds,
Series 1991B, 7.750%, 2/01/14
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Mississippi (continued)
$ 4,080,000 Mississippi Housing Finance Corporation, Single Family Mortgage 10/99 at 102 AAA $ 4,207,908
Purchase Revenue Bonds, Series 1989 (GNMA Mortgage-Backed
Securities Program), 8.250%, 10/15/18 (Alternative Minimum Tax)
8,700,000 Mississippi Home Corporation, Single Family Mortgage Revenue Bonds, 6/06 at 105 Aaa 9,874,500
Series 1996C, 7.600%, 6/01/29 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Missouri - 0.6%
5,000,000 St. Louis Municipal Finance Corporation, City Justice Center, 2/06 at 102 AAA 5,414,750
Leasehold Revenue Improvement Bonds, Series 1996A (City of
St. Louis, Missouri, Lessee), 6.000%, 2/15/19
- ------------------------------------------------------------------------------------------------------------------------------------
Nevada - 2.1%
3,270,000 Clark County, Nevada, Industrial Development Revenue Bonds 6/00 at 102 AAA 3,472,184
(Nevada Power Company Project), Series 1990, 7.800%, 6/01/20
(Alternative Minimum Tax)
13,185,000 Washoe County, Nevada, Hospital Refunding Revenue Bonds 6/04 at 102 AAA 14,206,706
(Washoe Medical Center, Inc. Project), Series 1994A, 6.000%, 6/01/19
- ------------------------------------------------------------------------------------------------------------------------------------
New Jersey - 0.5%
3,750,000 New Jersey Health Care Facilities Financing Authority, Revenue 7/04 at 102 AAA 4,221,113
Bonds, Monmouth Medical Center Issue, Series C, 6.250%, 7/01/24
- ------------------------------------------------------------------------------------------------------------------------------------
New Mexico - 3.2%
5,000,000 City of Albuquerque, New Mexico, Airport Revenue Bonds, 7/00 at 105 AAA 5,394,200
Series 1995A, 6.600%, 7/01/16 (Alternative Minimum Tax)
6,000,000 City of Farmington, New Mexico, Pollution Control Refunding Revenue 4/01 at 102 A+ 6,440,280
Bonds (Southern California Edison Company Four Corners Project),
1991 Series A, 7.200%, 4/01/21
5,400,000 City of Farmington, New Mexico, Pollution Control Refunding Revenue 4/09 at 102 AAA 5,342,706
Bonds (Southern California Edison Company Four Corners Project),
1999 Series A, 5.125%, 4/01/29 (DD)
3,850,000 New Mexico Mortgage Finance Authority, Multifamily Housing 1/01 at 102 AAA 4,066,447
Refunding Revenue Bonds, 1990 Series A - Tax-Exempt (Fannie Mae
Collateralized), 7.625%, 1/01/24
5,750,000 City of Santa Fe, New Mexico, Revenue Bonds, Series 1994A, 6/04 at 100 AAA 6,385,030
6.300%, 6/01/24 (Pre-refunded to 6/01/04)
- ------------------------------------------------------------------------------------------------------------------------------------
New York - 8.6%
The City of New York, General Obligation Bonds, Fiscal 1991 Series A:
2,000,000 8.000%, 3/15/11 3/00 at 101 1/2 AAA 2,105,440
6,000,000 7.250%, 3/15/19 3/00 at 101 1/2 AAA 6,279,420
17,700,000 New York City Housing Development Corporation, Multi-Unit 6/01 at 102 AAA 19,039,536
Mortgage Refunding Bonds (FHA-Insured Mortgage Loans),
1991 Series A, 7.250%, 6/01/19
10,335,000 New York City, New York, Municipal Water Finance Authority, 6/05 at 101 AAA 11,543,472
Water and Sewer System Revenue Bonds, Fiscal 1996 Series A,
6.000%, 6/15/25 (Pre-refunded to 6/15/05)
7,000,000 New York State Energy Research and Development Authority, 7/05 at 102 A+ 7,598,640
Facilities Refunding Revenue Bonds, Series 1995 A (Consolidated
Edison Company of New York, Inc. Project), 6.100%, 8/15/20
11,950,000 New York State Finance Agency, Housing Project Mortgage Revenue 5/06 at 102 AAA 12,890,465
Bonds, 1996 Series A Refunding, 6.125%, 11/01/20
12,000,000 New York State Medical Care Facilities Finance Agency, New York 2/05 at 102 AAA 13,976,520
Hospital FHA-Insured Mortgage Revenue Bonds, 1994 Series A,
6.900%, 8/15/34 (Pre-refunded to 2/15/05)
- ------------------------------------------------------------------------------------------------------------------------------------
North Dakota - 3.3%
21,075,000 Mercer County, North Dakota, Pollution Control Refunding Revenue 1/05 at 102 AAA 22,716,743
Bonds, Second 1995 Series (Basin Electric Power Cooperative-
Antelope Valley Unit 1 and Common Facilities), 6.050%, 1/01/19
5,000,000 Oliver County, North Dakota (Square Butte Electric Cooperative), 1/09 at 102 AAA 5,053,850
Pollution Control Revenue Refunding Bonds, Series 1998A,
5.300%, 1/01/27
- ------------------------------------------------------------------------------------------------------------------------------------
Oklahoma - 1.4%
1,230,000 Oklahoma Housing Finance Agency, Single Family Mortgage 3/01 at 102 AAA 1,287,748
Revenue Bonds, 1991 Series A, 7.200%, 3/01/11
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Oklahoma (continued)
$ 9,900,000 Pottawatomie County Development Authority, Water Revenue Bonds, 7/00 at 102 AAA $ 10,538,847
Series 1990 (North Deer Creek Reservoir Project), 7.375%, 7/01/26
(Pre-refunded to 7/01/00)
- ------------------------------------------------------------------------------------------------------------------------------------
Oregon - 1.2%
10,000,000 Oregon Health Sciences University, Insured Revenue Bonds, 7/06 at 102 AAA 10,075,200
1995 Series B, 5.250%, 7/01/25
- ------------------------------------------------------------------------------------------------------------------------------------
Pennsylvania - 5.1%
7,000,000 County of Allegheny, Pennsylvania, Airport Revenue Refunding Bonds, 1/08 at 101 AAA 7,102,900
Series 1997A (Pittsburgh International Airport),
5.250%, 1/01/16 (Alternative Minimum Tax)
7,000,000 Berks County Municipal Authority, Pennsylvania, Hospital Revenue 10/04 at 102 AAA 7,668,570
Bonds (The Reading Hospital and Medical Center Project),
Series B of 1994, 6.100%, 10/01/23
7,250,000 Lehigh County Industrial Development Authority, Pollution Control 8/05 at 102 AAA 8,006,973
Revenue Refunding Bonds, 1995 Series A (Pennsylvania Power and
Light Company Project), 6.150%, 8/01/29
14,190,000 City of Philadelphia, Pennsylvania, Water and Sewer Revenue 8/01 at 102 AAA 15,500,447
Bonds, Sixteenth Series, 7.000%, 8/01/21 (Pre-refunded to 8/01/01)
5,000,000 Health Care Facilities Authority of Sayre, Pennsylvania, 3/01 at 102 AAA 5,370,800
Series 1991A Revenue Bonds, Guthrie Healthcare System, 7.100%, 3/01/17
- ------------------------------------------------------------------------------------------------------------------------------------
Rhode Island - 2.3%
12,500,000 Rhode Island Depositors Economic Protection Corporation, Special 8/01 at 102 AAA 13,782,750
Obligation Bonds, 1991 Series A, 7.500%, 8/01/14
(Pre-refunded to 8/01/01)
5,050,000 Rhode Island Port Authority and Economic Development Corporation, 7/04 at 102 AAA 5,636,053
Airport Revenue Bonds, 1994 Series A, 6.625%, 7/01/24
(Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Tennessee - 0.6%
5,170,000 The Health, Educational and Housing Facilities Board of the County 2/03 at 102 AAA 5,531,435
of Sullivan, Tennessee, Hospital Revenue Bonds, Series 1993
(Holston Valley Health Care, Inc.), 5.750%, 2/15/13
- ------------------------------------------------------------------------------------------------------------------------------------
Texas - 3.5%
8,000,000 Abilene Health Facilities Development Corporation (Texas), 9/05 at 102 AAA 8,796,560
Hospital Revenue Refunding and Improvement Bonds (Hendrick
Medical Center Project), Series 1995C, 6.150%, 9/01/25
Brazos River Authority (Texas), Revenue Refunding Bonds
(Houston Industries Incorporated Project), Series 1998C:
1,750,000 5.125%, 5/01/19 (Optional put 5/01/08) 5/08 at 102 AAA 1,741,338
2,000,000 5.125%, 11/01/20 (Optional put 11/01/08) 11/08 at 102 AAA 1,974,340
Harris County Hospital District, Refunding Revenue Bonds, Series 1990:
3,000,000 7.500%, 2/15/03 No Opt. Call AAA 3,247,320
5,000,000 7.400%, 2/15/10 No Opt. Call AAA 6,003,000
7,450,000 Matagorda County Navigation District Number One (Texas), Pollution 7/00 at 102 AAA 7,788,305
Control Revenue Refunding Bonds (Central Power and Light
Company Project), Series 1995, 6.100%, 7/01/28
- ------------------------------------------------------------------------------------------------------------------------------------
Utah - 2.1%
10,770,000 Intermountain Power Agency, Utah, Power Supply Revenue 7/03 at 100 A+ 10,338,874
Refunding Bonds, 1993 Series A, 5.000%, 7/01/23
6,000,000 Salt Lake City, Utah, Hospital Revenue Refunding Bonds (IHC 5/00 at 100 AAA 7,123,800
Hospitals, Inc.), Series 1988 A, 8.000%, 5/15/07
- ------------------------------------------------------------------------------------------------------------------------------------
Vermont - 0.2%
1,230,000 Vermont Housing Finance Agency, Single Family Housing Bonds, 6/07 at 101 1/2 AAA 1,295,540
Series 9, 6.000%, 5/01/37 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
$ 795,554,000 Total Investments - (cost $773,146,999) - 97.8% 832,432,036
=============
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Short-Term Investments - 1.2%
$ 10,000,000 Certificates of Participation, California Statewide Communities VMIG-1 $ 10,000,000
============= Development Authority, Northern California Retired Officers
Community, Variable Rate Demand Bonds, 4.200%, 6/01/26+
--------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 1.0% 8,864,752
--------------------------------------------------------------------------------------------------------------------
Net Assets - 100% $ 851,296,788
====================================================================================================================
All of the bonds in the portfolio, excluding temporary investments in
short-term municipal securities, are either covered by Original Issue Insurance,
Secondary Market Insurance or Portfolio Insurance, or are backed by an escrow or
trust containing sufficient U.S. Government or U.S. Government agency
securities, any of which ensure the timely payment of principal and interest.
* Optional Call Provisions: Dates (month and year) and prices of the earliest
optional call or redemption. There may be other call provisions at varying
prices at later dates.
** Ratings: Using the higher of Standard & Poor's or Moody's rating.
(DD) Security purchased on a delayed delivery basis (note 1).
+ Security has a maturity of more than one year, but has variable rate and
demand features which qualify it as a short-term security. The rate
disclosed is that currently in effect. This rate changes periodically based
on market conditions or a specified market index.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
Portfolio of Investments
Nuveen Insured Municipal Opportunity Fund, Inc. (NIO)
April 30, 1999
(Unaudited)
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Alabama - 2.7%
$ 3,850,000 Alabama Housing Finance Authority, Multifamily Housing Revenue 7/05 at 103 Aaa $ 4,181,639
Refunding Bonds (GNMA Collateralized - Royal Hills),
1995 Series F, 6.500%, 7/20/30
11,000,000 The Special Care Facilities Financing Authority of the City of 5/05 at 102 AAA 11,229,020
Birmingham, Alabama, Baptist Medical Centers, Revenue Bonds,
Series 1995-B (Baptist Health System, Inc.), 5.875%, 11/15/20
The Special Care Facilities Financing Authority of the City of Birmingham,
Alabama, Baptist Medical Centers Revenue Bonds, Series 1996-A
(Baptist Health System, Inc.):
7,465,000 5.875%, 11/15/19 11/06 at 102 AAA 7,659,314
10,000,000 5.875%, 11/15/26 11/06 at 102 AAA 10,184,600
Jefferson County, Alabama, Sewer Revenue Capital Improvement
Warrants, Series 1999-A:
5,000,000 5.000%, 2/01/33 2/09 at 101 AAA 4,822,050
10,250,000 5.125%, 2/01/39 2/09 at 101 AAA 10,027,883
4,250,000 County Board of Education of Shelby County, Alabama, Capital Outlay 2/05 at 102 AAA 4,535,430
Refunding School Warrants, Series 1995, 5.875%, 2/01/17
- ------------------------------------------------------------------------------------------------------------------------------------
Alaska - 1.1%
4,000,000 Alaska Energy Authority, Power Revenue Bonds, Second Series 7/00 at 102 AAA 4,238,520
(Bradley Lake Hydroelectric Project), 7.250%, 7/01/21
15,950,000 Alaska State Housing Finance Corporation, Governmental Purpose 12/05 at 102 AAA 16,720,864
Bonds, 1995 Series A, 5.875%, 12/01/30
- ------------------------------------------------------------------------------------------------------------------------------------
Arizona - 0.9%
5,000,000 Coconino County, Arizona, Pollution Control Corporation, Pollution 8/03 at 102 A- 5,122,100
Control Revenue Refunding Bonds (Arizona Public Service Company),
1993 Series A, 5.875%, 8/15/28
10,725,000 The Industrial Development Authority of the County of Pima, 1/02 at 103 AAA 11,861,850
Arizona, Industrial Development Lease Obligation Refunding
Revenue Bonds, 1988 Series A (Irvington Project), 7.250%, 7/15/10
- ------------------------------------------------------------------------------------------------------------------------------------
Arkansas - 0.6%
10,775,000 Arkansas Development Finance Authority, Single Family Mortgage 9/01 at 102 AAA 11,406,738
Revenue Bonds, 1990 Series A (GNMA-Backed Securities Program),
7.400%, 9/01/23 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
California - 9.5%
6,135,000 California Housing Finance Agency, Housing Revenue Bonds (Insured), 8/04 at 102 AAA 6,504,266
1994 Series C, 6.250%, 8/01/25
5,000,000 California Housing Finance Agency, Multifamily Housing Revenue 8/08 at 101 1/2 AAA 5,096,250
Bonds III, 1998 Series B, 5.500%, 8/01/39 (Alternative Minimum Tax)
California Health Facilities Financing Authority, Insured Health
Facility Revenue Bonds, 1991 Series D (Catholic Healthcare
West):
9,000,000 6.500%, 7/01/16 (Pre-refunded to 7/01/01) 7/01 at 102 AAA 9,732,690
14,000,000 6.650%, 7/01/21 (Pre-refunded to 7/01/01) 7/01 at 102 AAA 15,183,140
18,655,000 California Housing Finance Agency, Home Mortgage Revenue Bonds, No Opt. Call AAA 7,862,896
1999 Series B, 0.000%, 2/01/16
California Rural Home Mortgage Finance Authority, Single Family
Mortgage Revenue Bonds (Mortgage-Backed Securities Program),
1996 Series A:
3,080,000 7.550%, 11/01/26 (Alternative Minimum Tax) No Opt. Call AAA 3,455,390
2,560,000 7.750%, 5/01/27 (Alternative Minimum Tax) No Opt. Call AAA 2,900,301
7,000,000 California Statewide Communities Development Authority, 7/06 at 102 AAA 7,489,650
Certificates of Participation, Huntington Memorial Hospital,
5.800%, 7/01/26
3,100,000 Campbell Union School District, Santa Clara County, California, 8/04 at 102 AAA 3,524,359
1994 General Obligation Bonds, Series A, 6.250%, 8/01/19
(Pre-refunded to 8/01/04)
8,200,000 Castaic Lake Water Agency, California, Refunding Revenue 8/04 at 102 AAA 9,120,942
Certificates of Participation (Water System Improvement Projects),
Series 1994A, 6.300%, 8/01/20
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
California (continued)
$ 11,750,000 East Bay Municipal Utility District, Alameda and Contra Costa 6/03 at 102 AAA $ 11,571,870
Counties, California, Water System Subordinated Revenue
Refunding Bonds, Series 1993A, 5.000%, 6/01/21
5,500,000 Fallbrook Union High School District, San Diego County, California, 9/04 at 102 AAA 6,262,190
1994 General Obligation Bonds, Series A, 6.250%, 9/01/19
(Pre-refunded to 9/01/04)
9,000,000 County of Orange, California, Refunding Recovery Bonds, 6/05 at 102 AAA 9,662,670
1995 Series A, 5.750%, 6/01/15
12,500,000 County of Orange, California, 1996 Recovery Certificates of 7/06 at 102 AAA 13,573,875
Participation, Series A, 6.000%, 7/01/26
6,500,000 City of Salinas, California, Housing Facility Refunding 7/04 at 102 AAA 6,988,605
Revenue Bonds, Series 1994A (GNMA Collateralized - Villa
Serra Project), 6.600%, 7/20/30
18,000,000 Airports Commission, City and County of San Francisco, California, 5/06 at 101 AAA 18,557,640
San Francisco International Airport, Second Series Revenue Bond,
Issue 13B, 5.500%, 5/01/26 (Alternative Minimum Tax)
8,500,000 Airports Commission, City and County of San Francisco, California, 5/05 at 101 AAA 9,337,590
San Francisco International Airport, Second Series Revenue Bonds,
Issue 11 (Noise Insulation Program), 6.250%, 5/01/26
(Alternative Minimum Tax)
20,395,000 San Joaquin Hills Transportation Corridor Agency, Toll Road 1/07 at 102 AAA 20,695,622
Refunding Revenue Bonds, Series 1997A, 5.250%, 1/15/30
11,000,000 Santa Ana Financing Authority, Police Administration and Housing No Opt. Call AAA 12,982,090
Facility Lease Revenue Bonds, Series 1994A, 6.250%, 7/01/24
5,500,000 Santa Clara County Financing Authority, Lease Revenue Bonds 11/04 at 102 AAA 6,421,690
(VMC Facility Replacement Project), 1994 Series A,
6.750%, 11/15/20 (Pre-refunded to 11/15/04)
- ------------------------------------------------------------------------------------------------------------------------------------
Colorado - 0.8%
Board of Water Commissioners, City and County of Denver,
Colorado, Certificates of Participation, Series 1991:
8,390,000 6.625%, 11/15/11 (Pre-refunded to 11/15/01) 11/01 at 101 AAA 9,082,930
5,760,000 6.625%, 11/15/11 11/01 at 101 AAA 6,185,491
- ------------------------------------------------------------------------------------------------------------------------------------
Connecticut - 0.1%
2,500,000 State of Connecticut Health and Educational Facilities Authority, 7/04 at 101 AAA 2,886,950
Revenue Bonds, Choate Rosemary Hall Issue, Series A,
7.000%, 7/01/25 (Pre-refunded to 7/01/04)
- ------------------------------------------------------------------------------------------------------------------------------------
District of Columbia - 1.1%
6,000,000 District of Columbia, Hospital Improvement and Refunding Revenue 7/02 at 102 AAA 6,488,100
Bonds (Children's Hospital Issue), Series 1992A, 6.250%, 7/15/19
4,825,000 District of Columbia Housing Finance Agency, Collateralized Single 6/00 at 102 AAA 4,995,564
Family Mortgage Revenue Bonds, Series 1988C, 7.850%, 12/01/22
(Alternative Minimum Tax)
4,820,000 District of Columbia Housing Finance Agency, Collateralized Single 12/01 at 102 AAA 5,061,964
Family Mortgage Revenue Bonds, Series 1990B, 7.100%, 12/01/24
(Alternative Minimum Tax)
5,000,000 District of Columbia, Revenue Bonds (The American College of 8/01 at 102 AAA 5,408,600
Obstetricians and Gynecologists Issue), Series 1991, 6.500%, 8/15/18
- ------------------------------------------------------------------------------------------------------------------------------------
Florida - 0.7%
1,839,000 Housing Finance Authority of Dade County (Florida), Single Family 12/01 at 102 AAA 1,941,120
Mortgage Revenue Refunding Bonds, 1991 Series D, 6.950%, 12/15/12
2,745,000 Escambia County Housing Finance Authority (Florida), Single Family 4/05 at 102 AAA 2,963,173
Mortgage Revenue Bonds (Multi-County Program), Series 1995,
6.950%, 10/01/27 (Alternative Minimum Tax)
7,280,000 Florida Housing Finance Agency, Home Ownership Revenue No Opt. Call AAA 8,139,477
Refunding Bonds, 1987 Series G1, 8.595%, 11/01/17
- ------------------------------------------------------------------------------------------------------------------------------------
Georgia - 1.4%
8,260,000 City of Atlanta, Georgia, Water and Wastewater Revenue Bonds, 5/09 at 101 AAA 7,937,364
Series 1999A, 5.000%, 11/01/38
8,315,000 The Fulton-De Kalb Hospital Authority, Georgia, Revenue 1/01 at 102 AAA 8,915,426
Certificates, Series 1991 (Grady Memorial Hospital),
6.900%, 1/01/15 (Pre-refunded to 1/01/01)
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Georgia (continued)
$ 5,000,000 The Hospital Authority of Hall County and the City of Gainesville, 10/05 at 102 AAA $ 5,411,750
Revenue Anticipation Certificates (Northeast Georgia Healthcare
Project), Series 1995, 6.000%, 10/01/20
5,000,000 The Glynn-Brunswick Memorial Hospital Authority, Revenue 8/06 at 102 AAA 5,194,550
Anticipation Certificates (Southeast Georgia Health Systems Project),
Series 1996, 5.250%, 8/01/13
- ------------------------------------------------------------------------------------------------------------------------------------
Hawaii - 1.4%
24,250,000 Department of Budget and Finance of the State of Hawaii, Special 5/06 at 101 AAA 26,627,713
Purpose Revenue Bonds (Hawaii Electric Company, Inc. and Subsidiaries
Project), Series 1996A, 6.200%, 5/01/26 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Idaho - 0.5%
Idaho Housing Agency, Single Family Mortgage Bonds, 1994 Series B:
2,805,000 6.750%, 7/01/22 No Opt. Call Aa1 3,134,279
2,690,000 6.900%, 7/01/26 (Alternative Minimum Tax) No Opt. Call Aa1 3,055,679
4,100,000 Idaho Housing Agency, Single Family Mortgage Bonds, 1995 Series B, 1/05 at 102 AAA 4,368,181
6.600%, 7/01/27 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Illinois - 10.8%
6,515,000 City of Berwyn, Illinois, Revenue Bonds, Series 1991 (MacNeal 6/01 at 102 AAA 7,077,701
Memorial Hospital Association Project), 7.000%, 6/01/15
(Pre-refunded to 6/01/01)
4,055,000 Central Lake County Joint Action Water Agency, Lake County, 2/03 at 102 Aa2 4,358,192
Illinois, General Obligation Water Refunding Bonds, Series 1992,
6.000%, 2/01/19
10,000,000 City of Chicago, Illinois, General Obligation Adjustable 7/02 at 101 1/2 AAA 11,087,400
Rate Bonds, Central Public Library Project, Series C of 1988,
6.850%, 1/01/17 (Pre-refunded to 7/01/02)
15,000,000 Chicago School Reform Board of Trustees of the Board of Education 12/07 at 102 AAA 14,988,300
of the City of Chicago, Illinois, Unlimited Tax General
Obligation Bonds (Dedicated Tax Revenues), Series 1997A,
5.250%, 12/01/27
City of Chicago, Illinois, Chicago Midway Airport Revenue Bonds,
Series 1998A:
30,000,000 5.125%, 1/01/31 (Alternative Minimum Tax) 1/09 at 101 AAA 28,818,300
12,750,000 5.125%, 1/01/35 (Alternative Minimum Tax) 1/09 at 101 AAA 12,245,483
5,000,000 City of Chicago, Illinois, Chicago Midway Airport Revenue Bonds, 1/09 at 101 AAA 4,774,300
Series 1998B, 5.000%, 1/01/31
5,750,000 City of Chicago, Illinois, Motor Fuel Tax Revenue Bonds, 1/01 at 100 AAA 6,022,723
Series 1990, 6.500%, 1/01/16 (Pre-refunded to 1/01/01)
3,250,000 City of Chicago, Water Revenue Bonds, Series 1995, 11/06 at 102 AAA 3,127,670
5.000%, 11/01/25
The County of Cook, Illinois, General Obligation Bonds, Series 1991:
18,430,000 6.750%, 11/01/18 (Pre-refunded to 11/01/01) 11/01 at 102 AAA 20,165,737
26,475,000 6.250%, 11/01/21 (Pre-refunded to 11/01/01) 11/01 at 102 AAA 28,653,893
6,370,000 City of Decatur, Macon County, Illinois (Decatur Memorial 10/01 at 102 AAA 7,091,530
Hospital), Hospital Facility Revenue Bonds, Series 1991B,
7.750%, 10/01/21 (Pre-refunded to 10/01/01)
Board of Governors of State Colleges and Universities, Eastern
Illinois University, Auxiliary Facilities System Revenue Bonds,
Series 1989:
12,355,000 0.000%, 10/01/09 10/04 at 74 1/16 AAA 7,077,562
16,470,000 0.000%, 4/01/16 10/04 at 47 1/16 AAA 5,878,802
1,920,000 Illinois Housing Development Authority, Residential Mortgage 8/99 at 102 Aa1 1,963,219
Revenue Bonds, 1989 Series A, 7.400%, 2/01/20
(Alternative Minimum Tax)
20,000,000 Illinois Health Facilities Authority, Brokaw-Mennonite Association, 8/02 at 102 AAA 21,656,800
Revenue Refunding Bonds, Series 1992 (BroMenn Healthcare),
6.250%, 8/15/18
3,500,000 Illinois Health Facilities Authority, Revenue Bonds, Series 1990 1/01 at 102 AAA 3,764,180
(Alexian Brothers Medical Center, Inc. Project), 7.125%, 1/01/21
3,615,000 State of Illinois, Civic Center Bonds (Dedicated Tax Revenue), 12/00 at 102 AAA 3,870,761
Series 1990-A, 7.000%, 12/15/10
State of Illinois Department of Central Management Services, Illinois
Student Assistance Commission:
2,965,000 6.875%, 7/01/07 7/02 at 102 AAA 3,282,552
6,085,000 6.950%, 7/01/13 7/02 at 102 AAA 6,701,106
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Illinois (continued)
$ 4,560,000 County of Macon, Illinois, Revenue Bonds, Millikin University, 10/05 at 100 AAA $ 5,134,286
Series 1995, 6.250%, 10/01/16
5,000,000 Regional Transportation Authority, Cook, DuPage, Kane, Lake, 6/04 at 102 AAA 5,724,850
McHenry and Will Counties, Illinois, General Obligation Bonds,
Series 1994D, 6.750%, 6/01/25 (Pre-refunded to 6/01/04)
- ------------------------------------------------------------------------------------------------------------------------------------
Indiana - 4.4%
10,500,000 Hospital Authority of the City of Fort Wayne (Indiana), Revenue 11/02 at 102 A+ 11,596,830
Bonds, Series 1992 (Parkview Memorial Hospital, Inc. Project),
6.400%, 11/15/22
7,750,000 Indiana Health Facility Financing Authority, Hospital Revenue 11/07 at 102 AAA 7,818,123
Bonds, Series 1997A (Sisters of St. Francis Health Services,
Inc. Project), 5.375%, 11/01/27
10,000,000 Indiana Health Facility Financing Authority, Hospital Revenue 5/06 at 102 AAA 10,448,500
Refunding and Improvement Bonds, Series 1995 (Community Hospitals
Projects), 5.700%, 5/15/22
1,440,000 Indiana Housing Finance Authority, Single Family Mortgage Revenue 7/00 at 102 Aaa 1,500,206
Bonds (GNMA Collateralized Home Mortgage Program),
1990 Series B, 7.800%, 1/01/22 (Alternative Minimum Tax)
520,000 Indiana Housing Finance Authority, Single Family Mortgage Revenue 7/00 at 102 Aaa 539,282
Bonds (GNMA Collateralized Home Mortgage Program),
1990 Series D, 7.800%, 1/01/22 (Alternative Minimum Tax)
12,250,000 City of Lawrenceburg, Indiana, Pollution Control Revenue Refunding 4/02 at 102 AAA 13,433,473
Bonds (Indiana Michigan Power Company Project), Series D,
7.000%, 4/01/15
12,950,000 Marion County Convention and Recreational Facilities Authority 6/01 at 102 AAA 14,073,931
(Indiana), Excise Taxes Lease Rental Revenue Bonds, Series 1991B,
7.000%, 6/01/21 (Pre-refunded to 6/01/01)
9,545,000 New Prairie School Building Corporation (LaPorte and St. Joseph 7/04 at 102 AAA 11,161,732
Counties, Indiana), First Mortgage Bonds, Series 1994, 7.200%, 7/15/21
(Pre-refunded to 7/15/04)
14,000,000 Holy Cross Health System Corporation, Indiana Hospital 12/01 at 102 AAA 15,414,700
Revenue Bonds, Hospital Authority of Marshall County,
Hospital Revenue Refunding Bonds, Series1991 (Holy Cross
Parkview Hospital, Inc.), 7.000%, 12/01/12
(Pre-refunded to 12/01/01)
- ------------------------------------------------------------------------------------------------------------------------------------
Iowa - 1.0%
5,000,000 City of Davenport, Iowa, Hospital Facility Revenue Bonds 7/02 at 102 AAA 5,470,700
(Mercy Hospital Project), Series 1992, 6.250%, 7/01/22
(Pre-refunded to 7/01/02)
7,015,000 Iowa Finance Authority, Hospital Facilities Revenue Bonds, 7/08 at 102 AAA 6,890,343
Series 1998 A (Iowa Health System), 5.125%, 1/01/28
7,000,000 Polk County, Iowa, Health Facilities Revenue Bonds, Catholic 11/01 at 101 AAA 7,595,140
Health Corporation (Mercy Health Center of Central Iowa
Project), Series 1991, 6.750%, 11/01/15 (Pre-refunded to 11/01/01)
- ------------------------------------------------------------------------------------------------------------------------------------
Kansas - 0.1%
1,760,000 Sedgwick County, Kansas, and Shawnee County, Kansas, GNMA 6/01 at 103 AAA 1,857,557
Collateralized Mortgage Revenue Bonds, Senior 1991 Series A,
7.300%, 12/01/12
- ------------------------------------------------------------------------------------------------------------------------------------
Kentucky - 1.2%
10,000,000 City of Danville, Kentucky, Multi-City Lease Revenue Bonds 3/02 at 102 AAA 11,031,300
(Louisville and Jefferson County Metropolitan Sewer District,
Sewer and Drainage System Revenue Project), Series 1991-G,
6.800%, 3/01/19 (Pre-refunded to 3/01/02)
53,000,000 Jefferson County, Kentucky, Capital Projects Corporation, 2/01 at 24 11/16 AAA 12,258,370
Lease Revenue Bonds, Series 1989B, 0.000%, 8/15/19
(Pre-refunded to 2/15/01)
- ------------------------------------------------------------------------------------------------------------------------------------
Louisiana - 2.1%
15,650,000 Louisiana Public Facilities Authority, Hospital Revenue Refunding 5/02 at 102 AAA 17,339,574
Bonds (Southern Baptist Hospital Project), Series 1992,
6.800%, 5/15/12 (Pre-refunded to 5/15/02)
5,340,000 Public Improvement Bonds, Issue of 1992, City of New Orleans, 9/02 at 100 AAA 5,897,656
Louisiana, 7.000%, 9/01/19 (Pre-refunded to 9/01/02)
8,995,000 Orleans Levee District (A Political Subdivision of the State 12/05 at 103 AAA 9,792,137
of Louisiana), Public Improvement Bonds, Series 1986,
5.950%, 11/01/15
3,000,000 Parish of St. Charles, State of Louisiana, Pollution Control 6/01 at 102 AAA 3,259,710
Revenue Bonds (Louisiana Power and Light Company Project),
Series 1991, 7.500%, 6/01/21 (Alternative Minimum Tax)
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Louisiana (continued)
$ 3,500,000 Hospital Service District No. 1 of the Parish of Tangipahoa, 2/04 at 102 AAA $ 3,849,860
State of Louisiana, Hospital Revenue Bonds, Series 1994,
6.250%, 2/01/24
- ------------------------------------------------------------------------------------------------------------------------------------
Maine - 0.6%
10,500,000 Maine Health and Higher Educational Facilities Authority, Revenue 7/01 at 102 AAA 11,218,935
Bonds, Series 1991, 6.375%, 7/01/21
- ------------------------------------------------------------------------------------------------------------------------------------
Massachusetts - 6.5%
6,000,000 Massachusetts Health and Educational Facilities Authority, Revenue 7/01 at 102 AAA 6,510,300
Bonds, Brigham and Women's Hospital Issue, Series D,
6.750%, 7/01/24 (Pre-refunded to 7/01/01)
10,500,000 Massachusetts Health and Educational Facilities Authority, 7/02 at 102 AAA 11,479,230
Revenue Bonds, New England Medical Center Hospitals Issue,
Series F, 6.625%, 7/01/25
5,850,000 Massachusetts Health and Educational Facilities Authority, Revenue 7/02 at 102 AAA 6,374,043
Bonds, South Shore Hospital Issue, Series D, 6.500%, 7/01/22
8,400,000 Massachusetts Health and Educational Facilities Authority, Revenue 10/05 at 102 AAA 9,140,544
Bonds, Berkshire Health Systems Issue, Series D, 6.000%, 10/01/13
7,000,000 Massachusetts Health and Educational Facilities Authority, Revenue 7/06 at 102 AAA 7,556,990
Bonds, Baystate Medical Center Issue, Series E, 6.000%, 7/01/26
20,000,000 Massachusetts Health and Educational Facilities Authority, Revenue 7/08 at 101 AAA 19,231,000
Bonds, Boston Medical Center Issue, Series A, 5.000%, 7/01/29
6,745,000 Massachusetts Housing Finance Agency, Housing Development 6/08 at 101 AAA 6,940,605
Bonds, 1998 Series A, 5.375%, 6/01/16 (Alternative Minimum Tax)
13,360,000 Massachusetts Housing Finance Agency, Single Family Housing 6/01 at 102 Aa 13,972,690
Revenue Bonds, Series 17, 7.150%, 12/01/24 (Alternative Minimum Tax)
2,430,000 Massachusetts Housing Finance Agency, Single Family Housing 6/99 at 102 Aa3 2,497,627
Revenue Bonds, Series 11, 7.750%, 12/01/20 (Alternative Minimum Tax)
4,865,000 Massachusetts Housing Finance Agency, Housing Revenue 12/05 at 102 AAA 5,161,424
Refunding Bonds, 1995 Series A, 6.100%, 12/01/16
15,400,000 Massachusetts Turnpike Authority, Metropolitan Highway System 1/07 at 102 AAA 14,709,002
Revenue Bonds, 1997 Series C (Senior), 5.000%, 1/01/37
25,000,000 Massachusetts Turnpike Authority, Metropolitan Highway System 1/09 at 101 AAA 23,860,000
Revenue Bonds, 1999 Series A (Subordinated), 5.000%, 1/01/39
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan - 5.2%
Cheboygan Area Schools, Counties of Cheboygan and Presque Isle,
State of Michigan, 1996 School Building and State Bonds
(General Obligation - Unlimited Tax):
3,180,000 5.700%, 5/01/16 (Pre-refunded to 5/01/07) 5/07 at 100 AAA 3,507,031
2,750,000 5.700%, 5/01/16 5/07 at 100 AAA 2,917,915
11,245,000 The Economic Development Corporation of the City of Detroit, 5/01 at 102 AAA 12,046,544
Resource Recovery Revenue Bonds, Series 1991A, 6.875%, 5/01/09
(Alternative Minimum Tax)
20,300,000 City of Detroit, Michigan, Sewage Disposal System Revenue Bonds, 7/01 at 102 AAA 21,947,142
Series 1991, 6.625%, 7/01/21 (Pre-refunded to 7/01/01)
13,500,000 City of Detroit, Michigan, Water Supply System Revenue and Revenue 7/04 at 102 AAA 13,157,100
Refunding Bonds, Series 1993, 5.000%, 7/01/23
8,000,000 Gaylord Community Schools, Counties of Otsego and Antrim, State 5/07 at 37 3/4 AAA 2,144,960
of Michigan, 1992 School Building and Site Refunding Bonds,
0.000%, 5/01/21 (Pre-refunded to 5/01/07)
8,500,000 County of Jackson Hospital Finance Authority, Hospital Revenue 6/03 at 102 AAA 8,459,285
Refunding Bonds (W. A. Foote Memorial Hospital, Jackson,
Michigan), Series 1993A, 5.250%, 6/01/23
5,880,000 Lincoln Consolidated School District, Counties of Washtenaw and 5/08 at 100 AAA 5,726,356
Wayne, State of Michigan, 1998 School Building and Site Bonds
(General Obligation- Unlimited Tax), 5.000%, 5/01/28
3,000,000 Michigan State Hospital Finance Authority, Revenue and Refunding 12/07 at 102 AAA 2,949,960
Bonds (Mid-Michigan Obligated Group), Series 1997A, 5.125%, 6/01/24
3,640,000 Michigan State Housing Development Authority, Rental Housing 1/02 at 102 AA- 3,907,176
Revenue Bonds, 1991 Series A, 7.150%, 4/01/10
(Alternative Minimum Tax)
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Michigan (continued)
$ 10,000,000 Michigan Strategic Fund Limited Obligation Refunding Revenue 12/01 at 102 AAA $ 10,865,000
Bonds (The Detroit Edison Company Pollution Control Bonds Project),
Collateralized Series 1991DD, 6.875%, 12/01/21
27,000,000 Okemos Public School, County of Ingham, State of Michigan, 5/06 at 34 17/32 AAA 6,937,920
1991 School Building and Site Bonds, Series I, 0.000%, 5/01/21
(Pre-refunded to 5/01/06)
6,125,000 Western Townships Utilities Authority, Sewage Disposal System 1/02 at 100 AAA 6,515,836
Refunding Bonds, Series 1991, 6.500%, 1/01/19
- ------------------------------------------------------------------------------------------------------------------------------------
Minnesota - 0.6%
6,635,000 Minnesota Housing Finance Agency, Single Family Mortgage Bonds, 1/04 at 102 AA 7,055,659
1994 Series M, 6.700%, 7/01/26 (Alternative Minimum Tax)
5,000,000 Minnesota Housing Finance Agency, Single Family Mortgage Bonds, 7/02 at 102 AA+ 5,279,100
1992 Series E, 6.850%, 1/01/24 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Missouri - 0.3%
4,850,000 Missouri Housing Development Commission, Single Family Mortgage 1/02 at 102 AAA 5,122,182
Revenue Bonds (GNMA Mortgage-Backed Securities Program),
1991 Series C, 6.900%, 7/01/18
- ------------------------------------------------------------------------------------------------------------------------------------
Montana - 1.4%
26,000,000 City of Forsyth, Rosebud County, Montana, Pollution Control Revenue 3/02 at 102 AAA 28,209,740
Refunding Bonds (Puget Sound, Power and Light Company-Colstrip
Project), Series 1992, 6.800%, 3/01/22
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska - 0.2%
4,000,000 Hospital Authority No.1 of Lancaster County, Nebraska, Hospital 6/08 at 101 AAA 4,080,200
Revenue Bonds, Series 1997B (Bryan Memorial Hospital
Project), 5.375%, 6/01/22
- ------------------------------------------------------------------------------------------------------------------------------------
Nevada - 2.8%
29,775,000 Clark County, Nevada, Industrial Development Revenue Bonds 6/00 at 102 AAA 31,615,988
(Nevada Power Company Project), Series 1990, 7.800%, 6/01/20
(Alternative Minimum Tax)
11,000,000 Clark County, Nevada, Las Vegas-McCarran International Airport 7/02 at 102 AAA 11,964,370
Passenger Facility Charge Revenue Bonds, 1992 Series A,
6.000%, 7/01/22 (Pre-refunded to 7/01/02)
5,450,000 Nevada Housing Division, Single Family Program Bonds, 4/04 at 102 Aa2 5,794,713
1994 Issue B-1 Senior Bonds, 6.700%, 10/01/17
4,205,000 Nevada Housing Division, 6.950%, 10/01/26 (Alternative Minimum Tax) 4/04 at 102 Aa2 4,493,127
- ------------------------------------------------------------------------------------------------------------------------------------
New Hampshire - 0.3%
4,950,000 New Hampshire Higher Educational and Health Facilities Authority, 1/03 at 102 AAA 5,310,608
Hospital Revenue Bonds, Lakes Region Hospital Association Issue,
Series 1993, 5.750%, 1/01/11
- ------------------------------------------------------------------------------------------------------------------------------------
New York - 5.0%
10,000,000 Long Island Power Authority (New York), Electric System General 6/08 at 101 AAA 10,155,000
Revenue Bonds, Series 1998A, 5.250%, 12/01/26
8,265,000 The City of New York, General Obligation Bonds, Fiscal 1992 8/02 at 101 1/2 AAA 9,034,802
Series C, Fixed Rate Bonds, Subseries C-1, 6.250%, 8/01/10
(Pre-refunded to 8/01/02)
10,000,000 The City of New York, General Obligation Bonds, 8/08 at 101 AAA 9,899,500
Fiscal 1998 Series H, 5.125%, 8/01/25
10,000,000 New York City (New York), Municipal Water Finance Authority, 6/06 at 101 AAA 10,747,900
Water and Sewer System Revenue Bonds, Fiscal 1996 Series B,
5.750%, 6/15/26
Dormitory Authority of the State of New York, City University
System Consolidated Third General Resolution Revenue Bonds, 1994
Series 2:
3,000,000 6.250%, 7/01/19 (Pre-refunded to 7/01/04) 7/04 at 100 AAA 3,336,630
6,400,000 6.750%, 7/01/24 (Pre-refunded to 7/01/04) 7/04 at 102 AAA 7,372,032
18,220,000 New York State Energy Research and Development Authority, 5/99 at 101 AAA 18,459,775
Electric Facilities Revenue Bonds, Series 1989 C (Consolidated Edison
Company of New York, Inc. Project), 7.250%, 11/01/24
(Alternative Minimum Tax)
7,000,000 New York State Energy Research and Development Authority, Electric 7/99 at 101 AAA 7,116,060
Facilities Revenue Bonds, Series 1990 A (Consolidated Edison
Company of New York, Inc. Project), 7.500%, 7/01/25
(Alternative Minimum Tax)
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
New York (continued)
$ 3,000,000 State of New York Mortgage Agency, Homeowner Mortgage Revenue 10/99 at 102 Aa2 $ 3,084,870
Bonds, Series KK, 7.800%, 10/01/20 (Alternative Minimum Tax)
15,600,000 Port of Authority of New York and New Jersey, Consolidated Revenue 1/05 at 101 AAA 17,412,408
Bonds, Ninety-Seventh Series, 6.650%, 1/15/23 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
North Carolina - 2.5%
45,000,000 City of Charlotte, North Carolina, Certificates of Participation, 12/01 at 102 AAA 49,365,900
Series 1991 (Convention Facility Project), 6.750%, 12/01/21
(Pre-refunded to 12/01/01)
- ------------------------------------------------------------------------------------------------------------------------------------
Ohio - 2.9%
12,550,000 City of Cleveland, Ohio, Waterworks Improvement First Mortgage 1/02 at 102 AAA 13,687,407
Revenue Bonds, Series F, 6.500%, 1/01/21 (Pre-refunded to 1/01/02)
9,000,000 County of Lucas, Ohio, Hospital Improvement Revenue Bonds, 8/02 at 102 AAA 9,892,440
Series 1992 (St. Vincent Medical Center), 6.625%, 8/15/22
9,105,000 Ohio Housing Finance Agency, Residential Mortgage Revenue Bonds 3/05 at 102 AAA 9,775,310
(GNMA Mortgage-Backed Securities Program), 1995 Series A-2,
6.625%, 3/01/26 (Alternative Minimum Tax)
State of Ohio, Ohio Air Quality Development Authority, Revenue
Refunding Bonds (JMG Funding, Limited Partnership Project),
Series 1994:
13,750,000 6.375%, 1/01/29 (Alternative Minimum Tax) 10/04 at 102 AAA 15,259,888
8,000,000 6.375%, 4/01/29 (Alternative Minimum Tax) 10/04 at 102 AAA 8,878,480
- ------------------------------------------------------------------------------------------------------------------------------------
Oklahoma - 2.1%
3,360,000 Norman Regional Hospital Authority (Norman, Oklahoma), Hospital 9/01 at 102 AAA 3,669,120
Revenue Bonds, Series 1991, 6.900%, 9/01/21 (Pre-refunded to 9/01/01)
615,000 Oklahoma Housing Finance Agency, Single Family Mortgage Revenue 3/01 at 102 AAA 643,345
Bonds, 1991 Series A, 7.150%, 3/01/07
32,575,000 Oklahoma Housing Finance Agency, GNMA Collateralized Single No Opt. Call AAA 36,019,155
Family Mortgage Revenue Bonds, Series 1987A, 7.997%, 8/01/18
(Alternative Minimum Tax)
1,285,000 Tulsa County Home Finance Authority, GNMA Collateralized Mortgage 12/01 at 102 AAA 1,348,877
Revenue Bonds, Series 1991C, 7.100%, 6/01/22
(Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Oregon - 0.3%
5,500,000 State of Oregon, Housing and Community Services Department, 7/05 at 102 Aa2 5,896,275
Mortgage Revenue Bonds (Single Family Mortgage Program),
1995 Series A, 6.450%, 7/01/26 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Pennsylvania - 5.9%
14,700,000 County of Allegheny (Pennsylvania), Airport Revenue Bonds, 1/02 at 102 AAA 15,870,855
Series 1992A and 1992B (Greater Pittsburgh International Airport),
6.625%, 1/01/22 (Alternative Minimum Tax)
7,000,000 Beaver County (Pennsylvania), Industrial Development Authority, 9/01 at 102 AAA 7,609,000
Pollution Control Revenue Refunding Bonds, 1991 Series A
(Pennsylvania Power Company-Mansfield Project), 7.150%, 9/01/21
24,800,000 Butler County Hospital Authority (Butler County, Pennsylvania), 6/01 at 102 AAA 26,941,976
Hospital Revenue Bonds, Series 1991 A (North Hills Passavant Hospital),
7.000%, 6/01/22 (Pre-refunded to 6/01/01)
Delaware County Industrial Development Authority, Pollution
Control Revenue Refunding Bonds, 1991 Series A (Philadelphia
Electric Company Project):
5,000,000 7.375%, 4/01/21 4/01 at 102 A 5,321,550
5,000,000 7.375%, 4/01/21 4/01 at 102 AAA 5,402,250
8,000,000 Delaware Valley Regional Finance Authority, Local Government No Opt. Call AAA 8,795,600
Revenue Bonds, Series 1997B, 5.700%, 7/01/27
10,000,000 The Harrisburg Authority (Dauphin County, Pennsylvania), 6/01 at 101 AAA 10,704,500
Commonwealth of Pennsylvania Lease Bonds, Series of 1991,
6.625%, 6/01/13 (Pre-refunded to 6/01/01)
7,120,000 Lehigh County (Pennsylvania), General Purpose Authority, Hospital 7/04 at 102 AAA 8,018,046
Revenue Bonds (Lehigh Valley Hospital, Inc.), Series A of 1994,
6.250%, 7/01/22 (Pre-refunded to 7/01/04)
9,000,000 Montgomery County Higher Education and Health Authority 6/08 at 101 AAA 8,659,440
(Pennsylvania), Hospital Revenue Bonds, Series 1998A (Abington
Memorial Hospital), 5.000%, 6/01/28
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Pennsylvania (continued)
$ 8,950,000 Montgomery County Industrial Development Authority, Pollution 6/02 at 102 AAA $ 9,768,657
Control Revenue Refunding Bonds, 1992 Series A (Philadelphia Electric
Company Project), 6.625%, 6/01/22
7,000,000 Certificates of Participation, Commonwealth of Pennsylvania, 11/01 at 102 AAA 7,514,500
Harristown Development Corporation, 6.250%, 5/01/16
- ------------------------------------------------------------------------------------------------------------------------------------
Puerto Rico - 0.4%
7,000,000 Puerto Rico Highway and Transportation Authority, Transportation 7/08 at 101 AAA 6,941,130
Revenue Bonds, Series A, 5.000%, 7/01/28
- ------------------------------------------------------------------------------------------------------------------------------------
Rhode Island - 3.7%
38,650,000 The Convention Center Authority (Rhode Island), Revenue Bonds, 5/01 at 102 AAA 41,709,921
1991 Series A, 6.700%, 5/15/20 (Pre-refunded to 5/15/01)
2,195,000 Providence Housing Development Corporation (Rhode Island), 7/04 at 102 AAA 2,377,844
Mortgage Revenue Refunding Bonds, Series 1994A, FHA-Insured
Mortgage Loan - Barbara Jordan Apartments Project, 6.750%, 7/01/25
5,140,000 Rhode Island Depositors Economic Protection Corporation, Special 8/01 at 102 AAA 5,624,753
Obligation Bonds, 1991 Series A, 7.100%, 8/01/18 (Pre-refunded to 8/01/01)
20,475,000 Rhode Island Depositors Economic Protection Corporation, Special 2/11 at 100 AAA 21,700,019
Obligation Refunding Bonds, 1992 Series B, 5.250%, 8/01/21
(Pre-refunded to 2/01/11)
- ------------------------------------------------------------------------------------------------------------------------------------
South Carolina - 0.8%
22,000,000 Piedmont Municipal Power Agency (South Carolina), Electric Revenue No Opt. Call AAA 11,324,908
Bonds, 1988 Refunding Series, 0.000%, 1/01/13
South Carolina Jobs Economic Development Authority, Hospital
Facilities Revenue Bonds, Series 1995 (Oconee Memorial Hospital,
Inc.):
3,000,000 6.150%, 3/01/15 3/05 at 102 AAA 3,232,860
775,000 6.150%, 3/01/25 3/05 at 102 AAA 845,827
- ------------------------------------------------------------------------------------------------------------------------------------
South Dakota - 0.1%
1,635,000 South Dakota Health and Educational Facilities Authority, Revenue 9/99 at 102 AAA 1,686,911
Bonds, Series 1989 (Rapid City Regional Hospital), 7.000%, 9/01/14
- ------------------------------------------------------------------------------------------------------------------------------------
Tennessee - 0.4%
7,500,000 Metropolitan Nashville Airport Authority (Tennessee), Airport 7/01 at 102 AAA 8,064,525
Improvement Revenue Bonds, Refunding Series 1991C, 6.600%, 7/01/15
- ------------------------------------------------------------------------------------------------------------------------------------
Texas - 4.5%
6,000,000 Brazos County, Texas, Health Facilities Development Corporation, 7/07 at 102 AAA 6,079,320
Franciscan Services Corporation Obligated Group, Revenue Bonds,
Series 1997 B, 5.375%, 1/01/28
9,500,000 Coastal Bend Health Facilities Development Corporation, Texas, 11/02 at 102 AAA 10,394,045
Incarnate Word Health Services Revenue Bonds, Series 1993-A,
6.000%, 11/15/22
Harris County, Texas, Toll Road Senior Lien Revenue Bonds, Series 1989:
9,000,000 0.000%, 8/15/18 (Pre-refunded to 8/15/09) 8/09 at 53 27/32 AAA 3,074,130
39,000,000 0.000%, 8/15/19 (Pre-refunded to 8/15/09) 8/09 at 50 1/4 AAA 12,435,540
7,280,000 0.000%, 8/15/20 (Pre-refunded to 8/15/09) 8/09 at 46 29/32 AAA 2,166,965
5,085,000 0.000%, 8/15/21 (Pre-refunded to 8/15/09) 8/09 at 43 25/32 AAA 1,412,918
14,160,000 City of Houston, Texas, Water and Sewer System, Junior Lien 12/01 at 102 AAA 15,229,505
Revenue Refunding Bonds, Series 1991C, 6.375%, 12/01/17
13,500,000 Matagorda County Navigation District Number One, Texas, 5/06 at 102 AAA 14,650,200
Pollution Control Revenue Refunding Bonds (Central Power and Light
Company Project), Series 1996, 6.125%, 5/01/30 (Alternative Minimum Tax)
3,945,000 Retama Development Corporation, Special Facilities Revenue Bonds No Opt. Call AAA 6,333,698
(Retama Park Racetrack Project), Series 1993, 10.000%, 12/15/17
14,445,000 Texas Department of Housing and Community Affairs, Single Family 9/06 at 102 AAA 15,313,145
Mortgage Revenue Bonds, 1996 Series D, 6.250%, 9/01/28
(Alternative Minimum Tax)
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Utah - 0.5%
$ 6,080,000 Utah Housing Finance Agency, Multifamily Housing Refunding Bonds, 1/02 at 102 AAA $ 6,511,619
1992 Issue A (FHA-Insured Mortgage Loans), 7.400%, 7/01/24
2,680,000 Utah Housing Finance Agency, Single Family Mortgage Bonds, 7/04 at 102 Aaa 2,841,818
1994 Issue D (Federally Insured or Guaranteed Mortgage Loans),
6.750%, 1/01/27 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Virginia - 0.4%
8,000,000 Industrial Development Authority of Loudoun County, Virginia, 6/05 at 102 AAA 8,461,920
Hospital Revenue Bonds (Loudoun Hospital Center), Series 1995,
5.800%, 6/01/20
- ------------------------------------------------------------------------------------------------------------------------------------
Washington - 3.3%
10,000,000 Public Utility District No. 1 of Chelan County, Washington, No Opt. Call AAA 2,025,100
Columbia River-Rock Island Hydro-Electric System Revenue Refunding
Bonds, Series 1997A, 0.000%, 6/01/29
2,515,000 Public Utility District No. 1 of Douglas County, Washington, 9/00 at 102 A+ 2,664,718
Wells Hydro-Electric Revenue Bonds, Series of 1990,
7.800%, 9/01/18 (Alternative Minimum Tax)
4,250,000 Public Utility District No. 1 of Snohomish County, Washington, No Opt. Call AAA 4,647,163
Generation System Revenue Bonds, Series 1989, 6.650%, 1/01/16
19,750,000 Washington Health Care Facilities Authority, Revenue Bonds, 12/99 at 102 AAA 20,561,330
Series 1989 (Group Health Cooperative of Puget Sound, Seattle),
7.200%, 12/01/15
8,000,000 Washington Health Care Facilities Authority, Revenue Bonds, 11/08 at 101 Aaa 7,931,600
Series 1998 (Swedish Health Services), 5.125%, 11/15/18
14,300,000 Washington Health Care Facilities Authority, Revenue Bonds, 10/08 at 101 Aaa 13,694,395
Series 1998 (Children's Hospital and Regional Medical Center),
5.000%, 10/01/28
4,100,000 Washington Public Power Supply System, Nuclear Project No. 1 7/02 at 102 Aaa 4,443,457
Refunding Revenue Bonds, Series 1992A, 6.250%, 7/01/17
8,500,000 Washington Public Power Supply System, Nuclear Project No. 3 7/03 at 102 AAA 8,788,660
Refunding Revenue Bonds, Series 1993B, 5.600%, 7/01/17
- ------------------------------------------------------------------------------------------------------------------------------------
West Virginia - 1.1%
10,000,000 The County Commission of Harrison County, West Virginia, 5/03 at 102 A+ 10,611,700
Solid Waste Disposal Revenue Bonds (West Penn Power Company-
Harrison Station Project), Series B, 6.300%, 5/01/23
(Alternative Minimum Tax)
4,100,000 West Virginia Water Development Authority, Water Development 11/01 at 102 AAA 4,479,168
Revenue Refunding Bonds (Loan Program), 1991 Series A,
7.000%, 11/01/25
5,050,000 State of West Virginia, University of West Virginia Board 5/02 at 100 AAA 5,493,693
of Trustees, Dormitory Revenue Bonds (West Virginia University
Project), 1992 Series A, 6.750%, 5/01/17 (Pre-refunded to 5/01/02)
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin - 2.7%
8,270,000 Wisconsin Housing and Economic Development Authority, 1/02 at 102 AAA 8,847,990
Housing Revenue Bonds, 1992 Series A, 6.850%, 11/01/12
8,150,000 Wisconsin Health and Educational Facilities Authority, Revenue 8/01 at 102 AAA 8,921,072
Bonds, Series 1991 (St. Luke's Medical Center Project),
7.100%, 8/15/19 (Pre-refunded to 8/15/01)
17,710,000 Wisconsin Health and Educational Facilities Authority, 12/01 at 102 AAA 19,419,362
Revenue Bonds, Series 1991-B (Novus Health Group),
6.750%, 12/15/20 (Pre-refunded to 12/15/01)
15,000,000 Wisconsin Health and Educational Facilities Authority, Revenue 2/07 at 102 AAA 15,843,600
Bonds, Series 1997 (Marshfield Clinic Project), 5.750%, 2/15/27
- ------------------------------------------------------------------------------------------------------------------------------------
$1,899,069,000 Total Investments - (cost $1,713,057,784) - 94.9% 1,852,514,895
==============
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Short-Term Investments - 0.0%
$ 400,000 Moffat County Pollution Control Revenue (Pacificorp Projects), VMIG-1 $ 400,000
AMBAC Variable Rate Demand Bonds, 4.250%, 5/01/13+
--------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 5.1% 98,820,948
--------------------------------------------------------------------------------------------------------------------
Net Assets - 100% $ 1,951,735,843
====================================================================================================================
All of the bonds in the portfolio, excluding temporary investments in
short-term municipal securities, are either covered by Original Issue Insurance,
Secondary Market Insurance or Portfolio Insurance, or are backed by an escrow or
trust containing sufficient U.S. Government or U.S. Government agency
securities, any of which ensure the timely payment of principal and interest.
* Optional Call Provisions: Dates (month and year) and prices of the earliest
optional call or redemption. There may be other call provisions at varying
prices at later dates.
** Ratings: Using the higher of Standard & Poor's or Moody's rating.
+ Security has a maturity of more than one year, but has variable rate and
demand features which qualify it as a short-term security. The rate
disclosed is that currently in effect. This rate changes periodically based
on market conditions or a specified market index.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
Portfolio of Investments
Nuveen Premier Insured Municipal Income Fund, Inc. (NIF)
April 30,1999
(Unaudited)
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Alabama - 1.6%
$ 2,250,000 BMC Special Care Facilities Financing Authority of the City of 1/02 at 100 AAA $ 2,367,563
Montgomery, Revenue Bonds, Series 1992-A (Baptist Medical Center),
5.750%, 1/01/22
3,000,000 BMC Special Care Facilities Financing Authority of the City of 12/02 at 102 AAA 3,321,090
Montgomery, Revenue Bonds, Series 1992-B (Baptist Medical Center),
6.700%, 12/01/10
West Morgan-East Lawrence Water Authority, Water Revenue Bonds,
Series 1996:
1,000,000 5.625%, 8/15/21 8/06 at 102 AAA 1,054,660
400,000 5.625%, 8/15/25 8/06 at 102 AAA 422,172
- ------------------------------------------------------------------------------------------------------------------------------------
Arkansas - 1.3%
5,555,000 Sebastian County (Arkansas), Community Junior College District, 4/07 at 101 Aaa 5,859,136
General Obligation Refunding and Improvement Bonds, Series 1997,
5.600%, 4/01/17
- ------------------------------------------------------------------------------------------------------------------------------------
California - 18.4%
4,000,000 State of California Veterans General Obligation Bonds, Series BH, 12/08 at 101 AAA 4,093,760
5.400%, 12/01/16 (Alternative Minimum Tax)
1,090,000 Housing Authority of the County of Kern, Guaranteed Tax-Exempt No Opt. Call AAA 1,278,712
Mortgage Obligations, 1994 Series A, Subseries I, 7.150%, 12/30/24
(Alternative Minimum Tax)
580,000 Housing Authority of the County of Kern, Guaranteed Tax-Exempt No Opt. Call AAA 671,739
Mortgage Obligations, 1994 Series A, Subseries III, 7.450%, 6/30/25
(Alternative Minimum Tax)
5,990,000 La Verne - Grand Terrace Housing Finance Agency, Single Family No Opt. Call AAA 8,952,834
Residential Mortgage Revenue Bonds, 1984 Series A, 10.250%, 7/01/17
5,840,000 Lancaster Redevelopment Agency, Lancaster Residential 8/01 at 102 AAA 6,236,536
Redevelopment Project Area, Tax Allocation Refunding Bonds,
Issue of 1992, 6.100%, 8/01/19
5,040,000 Northern California Power Agency, Hydroelectric Project Number No Opt. Call AAA 6,454,022
One, Revenue Bonds, 1992 Refunding Series A, 10.000%, 7/01/04
5,000,000 Ontario Redevelopment Financing Authority (San Bernardino County, No Opt. Call AAA 6,747,600
California), 1995 Revenue Refunding Bonds (Ontario Redevelopment
Project No.1), 7.400%, 8/01/25
1,340,000 Pomona Public Financing Authority, California, 1992 Revenue Bonds, 7/02 at 102 AAA 1,450,510
Series A (Water Treatment Project), 6.100%, 7/01/17
8,880,000 City of Pomona, California, Single Family Mortgage Revenue No Opt. Call AAA 11,572,150
Refunding Bonds (GNMA and FHLMC Mortgage-Backed Securities),
Series 1990B, 7.500%, 8/01/23
10,305,000 City of San Bernardino, California, Single Family Mortgage Revenue No Opt. Call AAA 13,088,999
Refunding Bonds (GNMA Mortgage-Backed Securities), Series 1990A,
7.500%, 5/01/23
14,755,000 County of San Bernardino, California, Single Family Mortgage No Opt. Call AAA 19,373,905
Revenue Bonds (GNMA Mortgage-Backed Securities), 1988 Series A,
8.300%, 9/01/14 (Alternative Minimum Tax)
2,000,000 City of Santa Barbara, California, Certificates of Participation 4/02 at 102 AAA 2,179,180
(1992 Water System Improvement Project and Refunding),
6.700%, 4/01/27
- ------------------------------------------------------------------------------------------------------------------------------------
Colorado - 0.3%
1,225,000 Summit School District RE-1, Summit County, Colorado, General 12/04 at 100 AAA 1,397,933
Obligation Improvement Bonds, Series 1994, 6.700%, 12/01/14
(Pre-refunded to 12/01/04)
- ------------------------------------------------------------------------------------------------------------------------------------
Florida - 7.6%
Miami-Dade County, Florida, Subordinate Special Obligation Refunding
Bonds, Series 1997A:
8,500,000 0.000%, 10/01/19 4/08 at 55 13/32 AAA 2,925,020
27,000,000 0.000%, 10/01/21 4/08 at 49 17/32 AAA 8,265,240
8,775,000 0.000%, 10/01/22 4/08 at 46 13/16 AAA 2,536,063
17,455,000 0.000%, 10/01/24 4/08 at 41 13/16 AAA 4,493,615
35,370,000 0.000%, 10/01/26 4/08 at 37 5/16 AAA 8,088,412
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Florida (continued)
$ 6,750,000 Polk County Industrial Development Authority, Industrial 9/02 at 103 AAA $ 7,386,863
Development Variable Rate Revenue Bonds, 1985 Series 2
(Winter Haven Hospital Project), 6.250%, 9/01/15
- ------------------------------------------------------------------------------------------------------------------------------------
Georgia - 3.6%
Development Authority of Burke County, Georgia, Pollution Control
Revenue Bonds (Oglethorpe Power Corporation-Vogtle Project),
Series 1992:
3,555,000 7.800%, 1/01/08 (Pre-refunded to 1/01/03) 1/03 at 103 AAA 4,136,420
10,000,000 8.000%, 1/01/15 (Pre-refunded to 1/01/03) 1/03 at 103 AAA 11,703,400
- ------------------------------------------------------------------------------------------------------------------------------------
Illinois - 11.2%
10,000,000 City of Chicago, Illinois, General Obligation Adjustable 7/02 at 101 1/2 AAA 11,087,400
Rate Bonds, Central Public Library Project, Series C of 1988,
6.850%, 1/01/17 (Pre-refunded to 7/01/02)
8,200,000 Board of Education of the City of Chicago, General Obligation No Opt. Call AAA 9,493,468
Lease Certificates, 1992 Series A, 6.250%, 1/01/15
10,000,000 City of Chicago, Illinois, Chicago Midway Airport Revenue Bonds, 1/09 at 101 AAA 9,528,500
Series 1998B, 5.000%, 1/01/35
10,150,000 Onterie Center Housing Finance Corporation (An Illinois Not for 7/02 at 102 AAA 10,851,365
Profit Corporation), Mortgage Revenue Refunding Bonds, Series 1992A
(FHA-Insured Mortgage Loan-Onterie Center Project), 7.050%, 7/01/27
3,225,000 Regional Transportation Authority, Cook, DuPage, Kane, Lake, No Opt. Call AAA 4,387,580
McHenry and Will Counties, Illinois, General Obligation Bonds,
Series 1992A, 9.000%, 6/01/09
4,000,000 Public Building Commission of St. Clair County, Illinois, Public 12/02 at 102 AAA 4,345,280
Building Revenue Bonds, Series 1992, 6.350%, 12/01/09
(Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Indiana - 3.7%
5,375,000 Indiana Health Facility Financing Authority, Hospital Revenue 5/02 at 102 AAA 5,803,065
Refunding and Improvement Bonds, Series 1992 (Community
Hospitals Projects), 6.400%, 5/01/12
7,000,000 Southwest Allen Multi-School Building Corporation, First Mortgage 1/02 at 101 AAA 7,502,250
Refunding Bonds, Series 1992B, Ft. Wayne, Indiana, 6.375%, 1/15/09
3,000,000 Wheeler-Union Township School Building Corporation (Porter County, 1/07 at 102 AAA 3,169,770
Indiana), First Mortgage Bonds, Series 1997A, 5.625%, 1/15/15
- ------------------------------------------------------------------------------------------------------------------------------------
Kentucky - 1.6%
6,500,000 County of Daviess, Kentucky, Insured Hospital Revenue Bonds 8/02 at 102 AAA 7,054,710
(ODCH, Inc. Project), 1992 Series A, 6.250%, 8/01/22
- ------------------------------------------------------------------------------------------------------------------------------------
Louisiana - 2.2%
Louisiana Public Facilities Authority, Hospital Revenue Bonds
(Our Lady of Lourdes Regional Medical Center Project), Series
1992:
5,000,000 6.375%, 2/01/12 (Pre-refunded to 2/01/03) 2/03 at 102 AAA 5,533,750
4,000,000 6.450%, 2/01/22 (Pre-refunded to 2/01/03) 2/03 at 102 AAA 4,443,360
- ------------------------------------------------------------------------------------------------------------------------------------
Massachusetts - 4.6%
3,000,000 Framingham Housing Authority, GNMA Collateralized Mortgage Revenue 8/01 at 102 AAA 3,178,710
Bonds (Beaver Terrace Apartments), 6.650%, 2/20/32
8,335,000 Massachusetts Health and Educational Facilities Authority, Revenue 7/02 at 102 AAA 9,112,322
Bonds, New England Medical Center Hospitals Issue, Series F,
6.625%, 7/01/25
8,270,000 Massachusetts Housing Finance Authority, Single Family Housing 6/08 at 101 AAA 8,404,801
Revenue Bonds, Series 59, 5.500%, 12/01/30 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan - 0.5%
2,000,000 Paw Paw Public Schools, County of Van Buren, State of Michigan, 5/05 at 100 AAA 2,172,480
1995 School Building and Site Bonds, 5.625%, 5/01/25
(Pre-refunded to 5/01/05)
- ------------------------------------------------------------------------------------------------------------------------------------
Minnesota - 0.4%
1,650,000 Minnesota Housing Finance Agency, Rental Housing Bonds, 2/05 at 102 AAA 1,734,431
1995 Series D, 5.950%, 2/01/18
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Mississippi - 0.5%
$ 1,900,000 Mississippi Home Corporation, Single Family Senior Revenue 9/00 at 103 AAA $ 2,011,530
Refunding Bonds, Series 1990A, 9.250%, 3/01/12
- ------------------------------------------------------------------------------------------------------------------------------------
Missouri - 3.0%
7,495,000 The Industrial Development Authority of Jefferson County, Missouri, 8/07 at 100 AAA 10,916,018
Housing Revenue Bonds (Richardson Road Apartments Project),
Series 1985, 11.000%, 12/15/15 (Pre-refunded to 8/15/07)
2,250,000 The Industrial Development Authority of University City, Missouri, 12/05 at 102 AAA 2,353,118
Multifamily Housing Revenue Refunding Bonds (GNMA Collateralized-
Canterbury Gardens Project), Series 1995A, 6.000%, 12/20/30
- ------------------------------------------------------------------------------------------------------------------------------------
Montana - 3.2%
13,000,000 City of Forsyth, Rosebud County, Montana, Pollution Control Revenue 3/02 at 102 AAA 14,104,870
Refunding Bonds (Puget Sound, Power and Light Company-Colstrip
Project), Series 1992, 6.800%, 3/01/22
- ------------------------------------------------------------------------------------------------------------------------------------
Nebraska - 0.6%
2,500,000 Nebraska Investment Finance Authority, Multifamily Housing Revenue 10/07 at 101 AAA 2,607,400
Bonds (Cambury Hills Apartments Project), Series 1997,
5.875%, 10/01/29 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Nevada - 3.7%
10,250,000 Humboldt County, Nevada, Variable Rate Demand Pollution Control 5/02 at 102 AAA 11,166,863
Refunding Revenue Bonds (Sierra Pacific Power Company Project),
Series 1987, 6.550%, 10/01/13
5,050,000 Washoe County, Nevada, Variable Rate Demand Gas and Water 7/02 at 102 AAA 5,463,949
Facilities Refunding Revenue Bonds (Sierra Pacific Power Company
Project), Series 1987, 6.300%, 12/01/14
- ------------------------------------------------------------------------------------------------------------------------------------
New Hampshire - 0.7%
3,000,000 New Hampshire Higher Educational and Health Facilities Authority, 10/06 at 102 AAA 3,243,990
Hospital Revenue Bonds, Concord Hospital Issue, Series 1996,
6.000%, 10/01/26
- ------------------------------------------------------------------------------------------------------------------------------------
New Jersey - 1.4%
6,000,000 The Union County Utilities Authority (New Jersey), Solid Waste 6/08 at 101 AAA 6,143,400
Bonds, County Deficiency Agreement, Series 1998A, 5.350%, 6/01/23
(Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
New York - 5.1%
7,645,000 Metropolitan Transportation Authority, Transit Facilities Revenue No Opt. Call AAA 9,691,643
Bonds, Series J, 9.100%, 7/01/05
The City of New York, General Obligation Bonds, Fiscal 1992 Series C:
6,925,000 6.625%, 8/01/14 (Pre-refunded to 8/01/02) 8/02 at 101 1/2 AAA 7,648,940
75,000 6.625%, 8/01/14 8/02 at 101 1/2 AAA 82,403
The City of New York, General Obligation Bonds, Fiscal 1992
Series C, Subseries C-1:
4,950,000 6.625%, 8/01/15 (Pre-refunded to 8/01/02) 8/02 at 101 1/2 AAA 5,467,473
50,000 6.625%, 8/01/15 8/02 at 101 1/2 AAA 54,694
- ------------------------------------------------------------------------------------------------------------------------------------
Ohio - 0.6%
2,690,000 County of Cuyahoga, Ohio, Hospital Improvement and Refunding 2/07 at 102 AAA 2,789,745
Revenue Bonds, Series 1997 (The MetroHealth System Project),
5.500%, 2/15/27
- ------------------------------------------------------------------------------------------------------------------------------------
Oklahoma - 2.4%
6,900,000 Oklahoma Housing Finance Agency, GNMA Collateralized Single No Opt. Call AAA 7,629,537
Family Mortgage Revenue Bonds, Series 1987A, 7.997%, 8/01/18
(Alternative Minimum Tax)
3,000,000 Tulsa Industrial Authority, Multifamily Housing Revenue Refunding 11/05 at 103 Aaa 3,229,200
Bonds (GNMA Collateralized - Country Club of Woodland Hills
Development), Series 1995, 6.250%, 11/01/27
- ------------------------------------------------------------------------------------------------------------------------------------
Pennsylvania - 5.8%
5,000,000 Allegheny County Hospital Development Authority, Health Center 11/08 at 101 Aaa 4,887,350
Revenue Refunding Bonds, Series 1998B (UPMC Health System),
5.000%, 11/01/18
19,140,000 Montgomery County Industrial Development Authority, Pollution 6/02 at 102 AAA 20,890,736
Control Revenue Refunding Bonds, 1992 Series A (Philadelphia
Electric Company Project), 6.625%, 6/01/22
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Rhode Island - 4.7%
$ 11,750,000 Rhode Island Depositors Economic Corporation, Special Obligation 8/02 at 102 AAA $ 13,026,873
Bonds, 1992 Series A, 6.625%, 8/01/19 (Pre-refunded to 8/01/02)
8,290,000 Rhode Island Health and Educational Building Corporation, Higher 4/09 at 101 AAA 7,960,473
Education Facility Revenue Bonds, Johnson and Wales University
Issue, Series 1999, 5.000%, 4/01/29
- ------------------------------------------------------------------------------------------------------------------------------------
South Carolina - 2.3%
9,450,000 South Carolina Public Service Authority, Santee Cooper Revenue 7/02 at 102 AAA 10,424,673
Bonds, 1991 Series D, 6.500%, 7/01/24 (Pre-refunded to 7/01/02)
- ------------------------------------------------------------------------------------------------------------------------------------
South Dakota - 0.5%
2,100,000 South Dakota Health and Educational Facilities Authority, 8/03 at 102 AAA 2,180,766
Vocational Education Program Revenue Bonds, Series 1993B,
5.700%, 8/01/23
- ------------------------------------------------------------------------------------------------------------------------------------
Texas - 4.3%
5,000,000 Brazos River Authority (Texas), Collateralized Pollution Control 4/03 at 102 AAA 5,347,300
Revenue Bonds (Texas Utilities Electric Company Project),
Series 1993A, 6.050%, 4/01/25 (Alternative Minimum Tax)
1,545,000 Corpus Christi (Texas), Housing Finance Corporation, Single Family 7/01 at 103 AAA 1,677,267
Mortgage Senior Revenue Refunding Bonds, Series 1991A,
7.700%, 7/01/11
1,355,000 City of El Paso (Texas), Property Finance Authority, Inc., 6/02 at 103 Aaa 1,451,151
Single Family Mortgage Revenue Bonds (GNMA Mortgage-Backed Securities
Program), Series 1992A, 8.700%, 12/01/18 (Alternative Minimum Tax)
5,210,000 Harris County (Texas), Toll Road Senior Lien Revenue Refunding 8/02 at 102 AAA 5,761,322
Bonds, Series 1992A, 6.500%, 8/15/17 (Pre-refunded to 8/15/02)
1,600,000 Harris County (Texas), Toll Road Senior Lien Revenue Refunding 8/99 at 100 AAA 1,615,152
Bonds, Series 1992B, 6.625%, 8/15/17
3,145,000 Rio Grande Valley Health Facilities Development Corporation 8/02 at 102 AAA 3,425,251
(Texas), Hospital Revenue Bonds (Valley Baptist Medical Center
Project), Series 1992A, 6.375%, 8/01/22
- ------------------------------------------------------------------------------------------------------------------------------------
Washington - 1.2%
4,750,000 Puyallup School District No. 3, Pierce County, Washington, 12/02 at 100 AAA 5,235,160
Unlimited Tax General Obligation and Refunding Bonds,
1992 Series A, 6.700%, 12/01/09 (Pre-refunded to 12/01/02)
- ------------------------------------------------------------------------------------------------------------------------------------
West Virginia - 1.5%
6,000,000 Mason County, West Virginia, Pollution Control Revenue Bonds 6/02 at 102 AAA 6,578,400
(Appalachian Power Company Project), Series I, 6.850%, 6/01/22
- ------------------------------------------------------------------------------------------------------------------------------------
$ 463,375,000 Total Investments - (cost $403,118,861) - 98.5% 438,927,423
=============
Other Assets Less Liabilities - 1.5% 6,721,447
--------------------------------------------------------------------------------------------------------------------
Net Assets - 100% $ 445,648,870
====================================================================================================================
All of the bonds in the portfolio are either covered by Original Issue
Insurance, Secondary Market Insurance or Portfolio Insurance, or are backed by
an escrow or trust containing sufficient U.S. Government or U.S. Government
agency securities, any of which ensure the timely payment of principal and
interest.
* Optional Call Provisions: Dates (month and year) and prices of the earliest
optional call or redemption. There may be other call provisions at varying
prices at later dates.
** Ratings: Using the higher of Standard & Poor's or Moody's rating.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
Portfolio of Investments
Nuveen Insured Premium Income Municipal Fund 2 (NPX)
April 30, 1999
(Unaudited)
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Alabama - 2.1%
$ 10,000,000 Jefferson County, Alabama, Sewer Revenue Capital Improvement 2/09 at 101 AAA $ 9,644,100
Warrants, Series 1999-A, 5.000%, 2/01/33
2,500,000 City of Mobile, Alabama, General Obligation Refunding Warrants, 2/06 at 102 AAA 2,676,850
Series 1996, 5.750%, 2/15/16
1,600,000 City of Northport, Alabama, General Obligation Warrants, 3/06 at 102 AAA 1,702,240
Series 1996-B, 5.700%, 3/01/21
2,000,000 City of Scottsboro, Alabama, General Obligation School Warrants, 7/06 at 102 AAA 2,163,360
Series 1996-B, 5.750%, 7/01/14
- ------------------------------------------------------------------------------------------------------------------------------------
Alaska - 1.4%
3,370,000 Alaska Housing Finance Corporation, Mortgage Revenue Bonds, 6/06 at 102 AAA 3,585,208
1996 Series A, 6.050%, 12/01/17
Municipality of Anchorage, Alaska, 1999 General Obligation
General Purpose and General Obligation Refunding General Purpose
Bonds, Series A:
1,500,000 5.000%, 4/01/16 4/09 at 100 AAA 1,499,085
2,600,000 5.000%, 4/01/19 4/09 at 100 AAA 2,559,622
3,000,000 Municipality of Anchorage, Alaska, 1989 General Obligation 6/99 at 100 AAA 3,007,860
Refunding Water Bonds, 6.250%, 6/01/23
- ------------------------------------------------------------------------------------------------------------------------------------
Arkansas - 0.3%
2,335,000 Board of Trustees of Arkansas, State University, Consolidated 4/07 at 101 AAA 2,330,003
Building System Revenue Bonds, Series 1999, 5.100%, 4/01/24 (WI)
- ------------------------------------------------------------------------------------------------------------------------------------
California - 7.9%
6,450,000 California Housing Finance Agency, Multi-Unit Rental Housing 2/03 at 102 Aa2 6,786,303
Revenue Bonds, 1992 Series A, 6.625%, 2/01/24
(Alternative Minimum Tax)
6,500,000 California Housing Finance Agency, Multifamily Housing Revenue 2/07 at 102 AAA 6,822,985
Bonds III, 1997 Series A, 5.950%, 8/01/28 (Alternative Minimum Tax)
2,500,000 California Housing Finance Agency, Home Mortgage Revenue Bonds, 8/07 at 102 AAA 2,672,300
1996 Series D, 6.150%, 8/01/28 (Alternative Minimum Tax)
10,355,000 State of California, Various Purpose General Obligation Bonds, No Opt. Call AAA 13,267,862
11.000%, 8/01/03
5,000,000 Irvine Public Facilities Infrastructure Authority, California, 9/09 at 102 AAA 4,955,650
Assessment Revenue Bonds, Series A, 5.050%, 9/02/22
3,000,000 M-S-R Public Power Agency, California, San Juan Project Revenue 7/03 at 102 AAA 3,262,650
Bonds, Series F, 6.000%, 7/01/20
Modesto Irrigation District, California, Certificates of Participation
(Refunding and Capital Improvements), Series 1999A:
3,320,000 0.000%, 7/01/17 7/09 at 67 21/32 AAA 1,314,886
3,325,000 0.000%, 7/01/18 7/09 at 63 31/32 AAA 1,242,287
3,320,000 0.000%, 7/01/19 7/09 at 60 15/32 AAA 1,169,005
3,320,000 0.000%, 7/01/20 7/09 at 57 3/8 AAA 1,105,494
3,320,000 0.000%, 7/01/21 7/09 at 54 7/16 AAA 1,045,070
3,500,000 Northern California Power Agency, Hydroelectric Project Number 7/03 at 102 AAA 3,628,310
One Revenue Bonds, 1993 Refunding Series A, 5.500%, 7/01/16
6,850,000 County of Orange, California, 1996 Recovery Certificates of 7/06 at 102 AAA 7,438,484
Participation, Series A, 6.000%, 7/01/26
San Leandro Housing Finance Corporation, Mortgage Revenue
Refunding Bonds, Series 1993A (FHA-Insured Mortgage Loan-Ashland
Village Apartments, Section 8 Assisted Project):
1,685,000 6.550%, 1/01/12 1/02 at 102 AAA 1,770,244
5,100,000 6.650%, 1/01/25 1/02 at 102 AAA 5,357,499
- ------------------------------------------------------------------------------------------------------------------------------------
Colorado - 5.4%
850,000 Adams County, Colorado, Pollution Control Refunding Revenue Bonds 1/09 at 101 AAA 849,210
(Public Service Company of Colorado Projects), Series 1999,
5.100%, 1/01/19
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Colorado (continued)
$ 9,425,000 Town of Castle Rock, Colorado, Multifamily Housing Revenue Bonds 12/06 at 101 AAA $ 9,990,217
(The Pines at Castle Rock (Phase II) Project), 1996 Series A,
6.200%, 12/01/28 (Alternative Minimum Tax)
19,805,000 City and County of Denver, Colorado, Airport System Revenue Bonds, 11/08 at 101 AAA 19,086,079
Series 1998B, 5.000%, 11/15/25 (Alternative Minimum Tax)
13,000,000 Pueblo County, Colorado, Pollution Control Refunding Revenue Bonds 1/09 at 102 AAA 12,987,910
(Public Service Company of Colorado Projects), Series 1999,
5.100%, 1/01/19
- ------------------------------------------------------------------------------------------------------------------------------------
District of Columbia - 5.0%
5,000,000 District of Columbia (Washington, D.C.), General Obligation No Opt. Call AAA 5,369,700
Refunding Bonds, Series 1993B, 5.500%, 6/01/12
245,000 District of Columbia (Washington D.C.), General Obligation No Opt. Call AAA 287,735
Refunding Bonds, 1994 Series A-1, 6.500%, 6/01/09
4,755,000 District of Columbia (Washington, D.C.), General Obligation No Opt. Call AAA 5,487,698
Refunding Bonds, Series 1994A, 6.500%, 6/01/09
5,000,000 District of Columbia, Hospital Improvement and Refunding Revenue 7/02 at 102 AAA 5,406,750
Bonds (Childrens Hospital Issue), Series 1992A, 6.250%, 7/15/19
3,775,000 District of Columbia Housing Finance Agency, Collateralized Single 6/03 at 102 AAA 3,956,729
Family Mortgage Revenue Bonds, Series 1990C-4, 6.350%, 12/01/24
(Alternative Minimum Tax)
4,030,000 District of Columbia Housing Finance Agency, Mortgage Revenue 7/03 at 102 AAA 4,161,499
Refunding Bonds, Series 1993A (FHA-Insured Mortgage Loan-Southview
Apartments II, Section 8 Assisted Project), 6.000%, 1/01/25
Washington Convention Center Authority (Washington, D.C.),
Senior Lien Dedicated Tax Revenue Bonds, Series 1998:
4,885,000 5.000%, 10/01/18 10/08 at 101 AAA 4,792,576
10,000,000 5.000%, 10/01/21 10/08 at 101 AAA 9,730,200
- ------------------------------------------------------------------------------------------------------------------------------------
Florida - 1.2%
10,000,000 Miami-Dade County, Florida, Subordinate Special Obligation Bonds, 4/08 at 102 AAA 9,741,400
Series 1997B, 5.000%, 10/01/37
- ------------------------------------------------------------------------------------------------------------------------------------
Georgia - 0.5%
645,000 Housing Authority of Fulton County, Georgia, Single Family Mortgage 9/06 at 102 AAA 682,874
Revenue Refunding Bonds (GNMA Mortgage-Backed Securities
Program), Series 1996A, 6.200%, 9/01/27 (Alternative Minimum Tax)
3,000,000 Municipal Electric Authority of Georgia, Power Revenue Bonds, 1/04 at 102 AAA 3,239,460
Series EE, 6.000%, 1/01/22
- ------------------------------------------------------------------------------------------------------------------------------------
Illinois - 20.0%
2,500,000 City of Aurora, Kane, DuPage, Kendall and Will Counties, Illinois, 1/05 at 100 AAA 2,725,425
General Obligation Corporate Purpose Bonds, Series 1996,
5.800%, 1/01/14 (Pre-refunded to 1/01/05)
Village of Bolingbrook, Illinois, General Obligation Bonds, Series 1997:
2,190,000 0.000%, 1/01/21 1/08 at 47 29/32 AAA 656,321
2,195,000 0.000%, 1/01/22 1/08 at 45 3/16 AAA 620,000
2,195,000 0.000%, 1/01/23 1/08 at 42 1/2 AAA 582,904
2,195,000 0.000%, 1/01/24 1/08 at 40 3/32 AAA 549,299
2,195,000 0.000%, 1/01/25 1/08 at 37 27/32 AAA 517,625
2,195,000 0.000%, 1/01/26 1/08 at 35 11/16 AAA 486,785
Village of Bolingbrook, Illinois, General Obligation Bonds,
Series 1999C Refunding:
2,505,000 0.000%, 1/01/21 (WI) No Opt. Call AAA 809,766
2,930,000 0.000%, 1/01/22 (WI) No Opt. Call AAA 897,078
1,500,000 City of Chicago, General Obligation Bonds, Series 1995, 7/05 at 102 AAA 1,695,705
6.125%, 1/01/16 (Pre-refunded to 7/01/05)
City of Chicago, Chicago Midway Airport Revenue Bonds, 1994 Series A:
1,100,000 6.100%, 1/01/08 (Alternative Minimum Tax) 1/04 at 102 AAA 1,190,926
2,750,000 6.250%, 1/01/14 (Alternative Minimum Tax) 1/04 at 102 AAA 2,988,453
9,000,000 City of Chicago, Chicago-OHare International Airport, International 1/02 at 102 AAA 9,745,020
Terminal Special Revenue Bonds, Series 1992, 6.750%, 1/01/18
(Alternative Minimum Tax)
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Illinois (continued)
$ 8,235,000 City of Chicago, Illinois, Chicago-OHare International Airport, 1/05 at 102 AAA $ 9,138,380
General Airport Second Lien Revenue Refunding Bonds,
1994 Series A, 6.375%, 1/01/15
The County of Cook, Illinois, General Obligation Bonds,
Series 1992A:
4,815,000 6.500%, 11/15/12 (Pre-refunded to 11/15/02) 11/02 at 102 AAA 5,354,232
30,000,000 6.600%, 11/15/22 (Pre-refunded to 11/15/02) 11/02 at 102 AAA 33,458,400
3,000,000 Community College District No. 508, Cook County, Illinois, No Opt. Call AAA 3,760,740
Certificates of Participation, 8.750%, 1/01/06
2,000,000 Illinois Development Finance Authority, Mortgage Revenue Refunding 7/07 at 102 Aaa 2,090,700
Bonds, Series 1997A (FHA-Insured Mortgage Loans, Section 8
Assisted Projects), 5.750%, 7/01/18
Illinois Development Finance Authority, School District Program Revenue
Bonds, Series 1995 (Indian Prairie Community Unit School District
Number 204 Project):
3,635,000 7.750%, 12/30/03 No Opt. Call AAA 4,238,010
4,340,000 7.750%, 12/30/04 No Opt. Call AAA 5,164,123
1,950,000 Illinois Health Facilities Authority, Health Facilities Refunding No Opt. Call AAA 2,312,076
Revenue Bonds (SSM Health Care), Series 1992AA, 6.550%, 6/01/14
Illinois Health Facilities Authority, Revenue Bonds (Lutheran General
HealthSystem), Series 1993A:
4,355,000 6.125%, 4/01/12 No Opt. Call AAA 4,796,336
5,000,000 6.250%, 4/01/18 No Opt. Call AAA 5,531,150
5,000,000 Illinois Health Facilities Authority, FHA-Insured Mortgage Revenue 2/06 at 102 AAA 5,349,900
Bonds (Sinai Health System), Series 1996, 6.000%, 2/15/24
3,765,000 Illinois Housing Development Authority, Housing Development Bonds, 1/04 at 102 A+ 3,904,719
1993 Series A, 6.000%, 7/01/18
1,770,000 Illinois Health Facilities Authority, Revenue Bonds (Elmhurst 1/02 at 102 AAA 1,913,317
Memorial Hospital), Series 1991, 6.625%, 1/01/22
4,000,000 The Illinois State Toll Highway Authority, Toll Highway Priority 1/03 at 102 AAA 4,403,320
Revenue Bonds, 1992 Series A, 6.200%, 1/01/16
(Pre-refunded to 1/01/03)
13,825,000 School District Number 46, Kane, Cook and DuPage Counties, No Opt. Call Aaa 17,844,757
Illinois (Elgin School District Number U-46), School Bonds,
Series 1997, 7.800%, 1/01/12
2,600,000 Community Unit School District Number 115, Kendall and Kane No Opt. Call AAA 3,027,518
Counties, Illinois (Yorkville), School Bonds, Series 1996, 7.000%, 1/01/07
4,035,000 Community Consolidated School District Number 41 (Lake Villa), No Opt. Call AAA 5,736,075
Lake County, Illinois, General Obligation School Bonds, Series 1997,
8.750%, 11/01/14
4,035,000 Community High School District No. 157, McHenry and Lake No Opt. Call AAA 5,957,597
Counties, Illinois (Richmond-Burton), General Obligation School Bonds,
Series 1998, 9.000%, 12/01/17
Metropolitan Pier and Exposition Authority, Illinois, McCormick
Place Expansion Project Bonds, Series 1992A:
6,335,000 6.500%, 6/15/22 (Pre-refunded to 6/15/03) 6/03 at 102 AAA 7,104,703
165,000 6.500%, 6/15/22 6/03 at 102 AAA 182,305
3,190,000 City of Peoria, City of Moline and City of Freeport, Illinois, 10/05 at 105 AAA 3,591,812
Collateralized Single Family Mortgage Revenue Bonds, Series 1995A,
7.600%, 4/01/27 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Indiana - 1.7%
1,000,000 Fort Wayne South Side School Building Corporation, First Mortgage 1/04 at 102 AAA 1,111,240
Bonds, Series 1994, Allen County, Indiana, 6.125%, 1/15/12
(Pre-refunded to 1/15/04)
2,220,000 Indiana Municipal Power Agency, Power Supply System Revenue 1/03 at 102 AAA 2,405,459
Bonds, 1993 Series A, 6.125%, 1/01/19
9,770,000 Northwest Allen Building Corporation, First Mortgage Bonds, 6/05 at 102 AAA 10,220,104
Series 1995, Allen County, Indiana, 5.500%, 6/01/15
- ------------------------------------------------------------------------------------------------------------------------------------
Kansas - 0.5%
1,465,000 City of Olathe, Kansas and Labette County, Kansas, Collateralized 2/05 at 105 Aaa 1,641,650
Single Family Mortgage Refunding Revenue Bonds, Series A-I,
8.100%, 8/01/23 (Alternative Minimum Tax)
2,125,000 Sedwick County and Shawnee County, Kansas, Collateralized Single 11/04 at 105 Aaa 2,376,536
Family Mortgage Refunding Revenue Bonds, Series A-II,
8.050%, 5/01/24 (Alternative Minimum Tax)
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Kentucky - 1.9%
$ 15,000,000 County of Jefferson, Kentucky, Health System Revenue Bonds, 10/08 at 101 AAA $ 14,926,350
Series 1998 (Alliant Health System, Inc.), 5.125%, 10/01/18
- ------------------------------------------------------------------------------------------------------------------------------------
Maine - 0.9%
4,000,000 Maine Health and Higher Educational Facilities Authority, Revenue 7/09 at 101 AAA 3,814,720
Bonds, Series 1999A, 5.000%, 7/01/30 (WI)
3,250,000 Finance Authority of Maine, Electric Rate Stabilization Revenue 7/08 at 102 AAA 3,192,768
Refunding Bonds, Series 1998A (Penobscot Energy Recovery
Company, LP), 5.000%, 7/01/18
- ------------------------------------------------------------------------------------------------------------------------------------
Maryland - 0.5%
3,575,000 Maryland Transportation Authority, Special Obligation Revenue 7/04 at 102 AAA 3,639,672
Bonds, Baltimore/Washington International Airport Projects,
Series 1994-A (Qualified Airport Bonds), 6.400%, 7/01/19
(Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Massachusetts - 2.4%
5,000,000 Massachusetts Housing Finance Agency, Housing Project Revenue, 4/03 at 102 AAA 5,306,600
6.150%, 10/01/15
8,080,000 Massachusetts Housing Finance Agency, Single Family Housing 6/06 at 102 AAA 8,607,139
Revenue Bonds, Series 48, 6.350%, 6/01/26 (Alternative Minimum Tax)
5,000,000 Massachusetts Housing Finance Agency, Single Family Housing 6/07 at 102 AAA 5,308,400
Revenue Bonds, Series 53, 6.150%, 12/01/29 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Michigan - 2.8%
10,000,000 Michigan State Housing Development Authority, Rental Housing 4/07 at 102 AAA 10,645,300
Revenue Bonds, 1997 Series A, 6.000%, 4/01/16 (Alternative Minimum Tax)
10,000,000 County of Monroe, Michigan, Pollution Control Revenue Bonds 9/03 at 102 AAA 11,044,900
(The Detroit Edison Company Project), Series CC-1992,
6.550%, 9/01/24 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Minnesota - 0.8%
4,135,000 Minnesota Housing Finance Agency, Rental Housing Bonds, 2/05 at 102 AAA 4,346,588
1995 Series D, 5.950%, 2/01/18
1,850,000 Minnesota Housing Finance Agency, Single Family Mortgage Bonds, 1/06 at 102 AA 1,929,772
1996 Series H, 6.000%, 1/01/21
- ------------------------------------------------------------------------------------------------------------------------------------
Missouri - 3.0%
1,000,000 The Industrial Development Authority of the City of Hazelwood, 9/06 at 102 AAA 1,060,300
Missouri, Multifamily Housing Revenue Refunding Bonds (GNMA
Collateralized - The Lakes Apartments Project), Series 1996,
6.000%, 9/20/16
8,000,000 City of Kansas City, Missouri, General Improvement Airport 9/05 at 101 AAA 9,209,520
Refunding Revenue Bonds, Series 1995, 6.750%, 9/01/09
4,500,000 Land Clearance for Redevelopment Authority of Kansas City, 12/05 at 102 AAA 4,824,630
Missouri, Lease Revenue Bonds (Municipal Auditorium and
Muehlebach Hotel Redevelopment Project), Series 1995A,
5.900%, 12/01/18
1,000,000 Kansas City Municipal Assistance Corporation, Leasehold Revenue 1/06 at 101 AAA 1,071,530
Capital Improvement Bonds (Kansas City, Missouri, Lessee),
Series 1996B, 5.750%, 1/15/14
1,030,000 Missouri Housing Development Commission, Multifamily Housing 12/06 at 102 AAA 1,089,143
Revenue Bonds (Brookstone Village Apartments Project),
1996 Series A, 6.000%, 12/01/16 (Alternative Minimum Tax)
3,415,000 Health and Educational Facilities Authority of the State of 2/02 at 102 AAA 3,676,487
Missouri, Health Facilities Revenue Bonds (Health Midwest),
Series 1992B, 6.250%, 2/15/22
2,700,000 The Industrial Development Authority of the County of St. Louis, 4/07 at 102 AAA 2,881,116
Missouri, Multifamily Housing Revenue Refunding Bonds (GNMA
Collateralized - South Summit Apartments Project), Series 1997A,
6.050%, 4/20/27
- ------------------------------------------------------------------------------------------------------------------------------------
Nevada - 3.4%
2,905,000 Clark County, Nevada, General Obligation (Limited Tax) No Opt. Call AAA 3,269,955
(Additionally Secured with Pledged Revenues), Airport Bonds,
Series June 1, 1991, 10.000%, 6/01/01
5,000,000 Clark County, Nevada, Industrial Development Revenue Bonds 6/02 at 102 AAA 5,437,650
(Nevada Power Company Project), Series 1992A, 6.700%, 6/01/22
(Alternative Minimum Tax)
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Nevada (continued)
Clark County School District, Nevada, General Obligation
(Limited Tax), School Improvement Bonds, Series May 1, 1995A:
$ 7,295,000 7.250%, 6/15/03 No Opt. Call AAA $ 8,220,371
8,320,000 7.250%, 6/15/04 No Opt. Call AAA 9,552,941
- ------------------------------------------------------------------------------------------------------------------------------------
New York - 13.9%
Long Island Power Authority (New York), Electric System General
Revenue Bonds, Series 1998A:
24,000,000 5.000%, 12/01/18 6/08 at 101 AAA 23,777,040
20,000,000 5.250%, 12/01/26 6/08 at 101 AAA 20,310,000
17,740,000 Long Island Power Authority (New York), Electric System General 4/08 at 101 AAA 17,043,350
Revenue Bonds, Series 1998B, 4.750%, 4/01/18
4,090,000 Metropolitan Transportation Authority (New York), Commuter No Opt. Call AAA 5,118,022
Facilities Revenue Bonds, Series 1994A, 8.000%, 7/01/07
5,000,000 Metropolitan Transportation Authority (New York), Transit No Opt. Call AAA 5,658,750
Facilities Revenue Bonds, Series K, 6.300%, 7/01/06
4,985,000 Metropolitan Transportation Authority (New York), Transit No Opt. Call AAA 6,237,980
Facilities Revenue Bonds, Series O, 8.000%, 7/01/07
4,000,000 The City of New York, General Obligation Bonds, Fiscal No Opt. Call AAA 4,838,880
1995 Series E, 8.000%, 8/01/05
5,000,000 The City of New York, General Obligation Bonds, Fiscal 8/06 at 101 1/2 AAA 5,558,000"
1997 Series E, 6.000%, 8/01/08
The City of New York, General Obligation Bonds, Fiscal 1993 Series A:
540,000 5.750%, 8/01/10 (Pre-refunded to 8/01/02) 8/02 at 101 1/2 AAA 582,082
1,960,000 5.750%, 8/01/10 8/02 at 101 1/2 AAA 2,098,043
5,230,000 Dormitory Authority of the State of New York, Maimonides Medical 2/06 at 102 AAA 5,631,664
Center, FHA-Insured Mortgage Hospital Revenue Bonds, Series 1996A,
5.750%, 8/01/14
New York State Medical Care Facilities Finance Agency, Mental
Health Services Facilities Improvement Revenue Bonds, 1995
Series C:
6,095,000 6.000%, 8/15/15 (Pre-refunded to 2/15/05) 2/05 at 102 AAA 6,817,806
55,000 6.000%, 8/15/15 2/05 at 102 AAA 59,937
New York State Medical Care Facilities Finance Agency, New York
Hospital FHA-Insured Mortgage
Revenue Bonds, 1994 Series A:
3,000,000 6.750%, 8/15/14 (Pre-refunded to 2/15/05) 2/05 at 102 AAA 3,471,060
2,500,000 6.800%, 8/15/24 (Pre-refunded to 2/15/05) 2/05 at 102 AAA 2,898,950
- ------------------------------------------------------------------------------------------------------------------------------------
Ohio - 2.4%
City of Cleveland, Ohio, Waterworks Improvement First Mortgage
Revenue Bonds, Series F of 1992:
1,915,000 6.250%, 1/01/15 (Pre-refunded to 1/01/02) 1/02 at 102 AAA 2,076,492
85,000 6.250%, 1/01/15 1/02 at 102 AAA 91,197
5,000,000 Fairfield City School District, County of Butler, Ohio, School 12/05 at 100 AAA 5,430,600
Improvement Bonds, Series 1995, 6.000%, 12/01/20
4,660,000 Ohio Housing Finance Agency, Single Family Mortgage Revenue 9/99 at 102 AAA 4,768,392
Bonds (GNMA Mortgage-Backed Securities Program), 1989 Series A,
7.650%, 3/01/29 (Alternative Minimum Tax)
5,500,000 Ohio Air Quality Development Authority, State of Ohio, 6/02 at 103 AAA 6,262,025
Collateralized Pollution Control Revenue Refunding Bonds,
Series 1992 (The Cleveland Electric Illuminating Company
Project), 8.000%, 12/01/13
- ------------------------------------------------------------------------------------------------------------------------------------
Oklahoma - 2.0%
8,425,000 McGee Creek Authority (Oklahoma), Water Revenue Bonds, No Opt. Call AAA 9,566,672
Series 1992, 6.000%, 1/01/23
6,000,000 Norman Regional Hospital Authority (Norman, Oklahoma), Hospital 9/01 at 102 AAA 6,552,000
Revenue Bonds, Series 1991, 6.900%, 9/01/21
(Pre-refunded to 9/01/01)
- ------------------------------------------------------------------------------------------------------------------------------------
Pennsylvania - 3.3%
3,715,000 Allegheny County Residential Finance Authority, Single Family 11/06 at 102 Aaa 3,967,843
Mortgage Revenue Bonds, 1996 Series AA, 6.450%, 5/01/28
(Alternative Minimum Tax)
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Pennsylvania (continued)
$ 6,000,000 Cambria County Industrial Development Authority, Pollution 11/05 at 102 AAA $ 6,422,220
Control Revenue Refunding Bonds, 1995 Series A (Pennsylvania
Electric Company Project), 5.800%, 11/01/20
4,750,000 Lehigh County Industrial Development Authority, Pollution Control 11/02 at 102 AAA 5,209,230
Revenue Refunding Bonds, 1992 Series A (Pennsylvania Power and
Light Company Project), 6.400%, 11/01/21
1,000,000 Luzerne County Industrial Development Authority, Exempt Facilities 12/04 at 102 AAA 1,141,290
Revenue Refunding Bonds, 1994 Series A (Pennsylvania Gas and
Water Company Project), 7.000%, 12/01/17 (Alternative Minimum Tax)
2,680,000 The School District of Philadelphia, Pennsylvania, General No Opt. Call AAA 3,059,354
Obligation Refunding Bonds, Series A of 1995, 6.250%, 9/01/08
University of Pittsburgh of the Commonwealth System of Higher
Education, University Capital Project Bonds (Pennsylvania), 1992
Series A:
1,395,000 6.125%, 6/01/21 (Pre-refunded to 6/01/02) 6/02 at 102 AAA 1,520,452
4,105,000 6.125%, 6/01/21 6/02 at 102 AAA 4,433,975
- ------------------------------------------------------------------------------------------------------------------------------------
South Carolina - 1.5%
5,000,000 Charleston County, South Carolina Revenue Bonds, Series 1999A 8/09 at 101 AAA 4,878,200
(CareAlliance Health Services), 5.000%, 8/15/19
6,500,000 Piedmont Municipal Power Agency (South Carolina), Electric Revenue 1/03 at 102 AAA 7,182,240
Bonds, 1992 Refunding Series, 6.300%, 1/01/22 (Pre-refunded to 1/01/03)
- ------------------------------------------------------------------------------------------------------------------------------------
Tennessee - 0.2%
1,500,000 Knoxvilles Community Development Corporation, Multifamily Mortgage 7/03 at 101 AAA 1,563,510
Revenue Bonds (GNMA Mortgage-Backed Security Program-
Morningside Gardens Project), Series 1993, 6.200%, 7/20/28
- ------------------------------------------------------------------------------------------------------------------------------------
Texas - 3.2%
State of Texas, Veterans Housing Assistance Bonds, Series 1993,
General Obligation Bonds:
7,330,000 6.800%, 12/01/23 (Alternative Minimum Tax) 12/03 at 102 AAA 7,878,064
1,460,000 6.800%, 12/01/23 (Alternative Minimum Tax) 12/03 at 102 AA 1,566,069
9,950,000 Tyler Health Facilities Development Corporation (Texas), Hospital 11/07 at 102 AAA 10,371,184
Revenue Bonds (East Texas Medical Center Regional Healthcare
System Project), Series 1997A, 5.600%, 11/01/27
5,250,000 Tyler Health Facilities Development Corporation (Texas), Hospital 2/09 at 102 AAA 5,254,095
Revenue Bonds (East Texas Medical Center Regional Healthcare
System Project), Series 1997D (Remarketed), 5.375%, 11/01/27
- ------------------------------------------------------------------------------------------------------------------------------------
Utah - 0.5%
3,600,000 State Board of Regents of the State of Utah, Student Loan Revenue 11/03 at 102 Aaa 3,776,976
Bonds, Series 1993B, 5.900%, 11/01/13 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Virginia - 0.3%
2,250,000 Virginia Housing Development Authority, Multifamily Housing 1/08 at 102 AAA 2,403,023
Revenue Bonds, Series B, 6.050%, 5/01/17 (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------------------
Washington - 5.4%
2,500,000 City of Tacoma, Washington, Sewer Revenue Bonds, 1995 Series B, 12/05 at 100 AAA 2,777,275
6.375%, 12/01/15
8,100,000 Washington Health Care Facilities Authority, Revenue Bonds, 2/03 at 102 AAA 8,811,828
Series 1992 (Virginia Mason Obligated Group, Seattle),
6.300%, 2/15/17
6,130,000 Washington Health Care Facilities Authority, Revenue Bonds, 11/02 at 102 AAA 6,767,459
Series 1992 (Swedish Hospital Medical Center, Seattle),
6.300%, 11/15/22 (Pre-refunded to 11/15/02)
3,750,000 Washington Public Power Supply System, Nuclear Project 7/03 at 102 AAA 3,900,375
No. 1 Refunding Revenue Bonds, Series 1993B, 5.600%, 7/01/15
10,500,000 Washington Public Power Supply System, Nuclear Project No. 1 7/06 at 102 AAA 11,344,305
Refunding Revenue Bonds, Series 1996A (Bonneville Power
Administration), 5.750%, 7/01/11
2,000,000 Washington Public Power Supply System, Nuclear Project No. 1 7/07 at 102 AAA 2,044,420
Refunding Revenue Bonds, Series 1997A, 5.125%, 7/01/14
6,295,000 Washington Public Power Supply System, Nuclear Project No. 3 7/03 at 102 AAA 6,508,778
Refunding Revenue Bonds, Series 1993B, 5.600%, 7/01/17
<PAGE>
<CAPTION>
Principal Optional Call Market
Amount Description Provisions* Ratings** Value
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
West Virginia - 2.8%
$ 20,000,000 The County Commission of Pleasants County, West Virginia, Pollution 5/05 at 102 AAA $ 22,075,400
Control Revenue Bonds (Monongahela Power Company-Pleasants
Station Project), 1995 Series C, 6.150%, 5/01/15
- ------------------------------------------------------------------------------------------------------------------------------------
Wisconsin - 1.0%
2,000,000 Wisconsin Health and Educational Facilities Authority, Revenue 8/02 at 102 AAA 2,209,013
Bonds, Series 1992 (Childrens Hospital of Wisconsin, Inc.
Project), 6.500%, 8/15/10 (Pre-refunded to 8/15/02)
5,000,000 Wisconsin Health and Educational Facilities Authority, Revenue 8/05 at 102 AAA 5,442,700
Bonds, Series 1995 (Mercy Health System Corporation),
6.125%, 8/15/13
- ------------------------------------------------------------------------------------------------------------------------------------
$ 742,540,000 Total Investments - (cost $733,465,426) - 98.2% 773,271,932
=============
Short-Term Investments - 0.9%
- ------------------------------------------------------------------------------------------------------------------------------------
$ 6,700,000 New York City Municipal Water Finance Authority, Water And VMIG-1 6,700,000
============= Sewer System Revenue Bonds, Fiscal 1996 Series A,
Variable Rate Demand Bonds, 4.400%, 6/15/25+
--------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 0.9% 7,451,953
--------------------------------------------------------------------------------------------------------------------
Net Assets - 100% $ 787,423,885
====================================================================================================================
All of the bonds in the portfolio, excluding temporary investments in
short-term municipal securities, are either covered by Original Issue Insurance,
Secondary Market Insurance or Portfolio Insurance, or are backed by an escrow or
trust containing sufficient U.S. Government or U.S. Government agency
securities, any of which ensure the timely payment of principal and interest.
* Optional Call Provisions: Dates (month and year) and prices of the earliest
optional call or redemption. There may be other call provisions at varying
prices at later dates.
** Ratings: Using the higher of Standard & Poor's or Moody's rating.
(WI) Security purchased on a when-issued basis (note 1).
+ Security has a maturity of more than one year, but has variable rate and
demand features which qualify it as a short-term security. The rate
disclosed is that currently in effect. This rate changes periodically based
on market conditions or a specified market index.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
Statement of Net Assets
April 30, 1999
(Unaudited)
<CAPTION>
Insured Insured Premier Insured
Quality Opportunity Insured Income Premium Income 2
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Assets
Investments in municipal securities, at
market value (note 1) $832,432,036 $1,852,514,895 $438,927,423 $773,271,932
Temporary investments in short-term municipal securities,
at amortized cost, which approximates market value
(note 1) 10,000,000 400,000 -- 6,700,000
Cash 2,475,974 69,644,757 884,631 4,298,731
Receivables:
Interest 15,449,114 35,803,603 7,528,265 14,019,822
Investments sold 219,243 1,857,790 190,463 247,582
Other assets 43,491 79,133 28,165 59,601
- ------------------------------------------------------------------------------------------------------------------------------------
Total assets 860,619,858 1,960,300,178 447,558,947 798,597,668
- ------------------------------------------------------------------------------------------------------------------------------------
Liabilities
Payable for investments purchased 5,387,502 -- -- 7,860,949
Accrued expenses:
Management fees (note 6) 438,447 944,509 233,119 406,197
Other 519,557 1,073,398 193,395 577,079
Preferred share dividends payable 87,546 151,484 38,928 75,709
Common share dividends payable 2,890,018 6,394,944 1,444,635 2,253,849
- ------------------------------------------------------------------------------------------------------------------------------------
Total liabilities 9,323,070 8,564,335 1,910,077 11,173,783
- ------------------------------------------------------------------------------------------------------------------------------------
Net assets (note 7) $851,296,788 $1,951,735,843 $445,648,870 $787,423,885
====================================================================================================================================
Preferred shares, at liquidation value $260,000,000 $ 680,000,000 $140,000,000 $268,900,000
====================================================================================================================================
Preferred shares outstanding 10,400 27,200 5,600 10,756
====================================================================================================================================
Common shares outstanding 37,778,077 80,948,495 19,261,806 37,253,960
====================================================================================================================================
Net asset value per Common share outstanding
(net assets less Preferred shares at liquidation
value, divided by Common shares outstanding) $ 15.65 $ 15.71 $ 15.87 $ 13.92
====================================================================================================================================
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
Statement of Operations
Six Months Ended April 30, 1999
(Unaudited)
<CAPTION>
Insured Insured Premier Insured
Quality Opportunity Insured Income Premium Income 2
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Investment Income (note 1) $25,013,189 $54,513,079 $12,770,851 $20,988,573
- -----------------------------------------------------------------------------------------------------------------------------------
Expenses
Management fees (note 6) 2,654,793 5,719,048 1,411,961 2,457,903
Preferred shares - auction fees 322,328 743,836 173,561 333,362
Preferred shares - dividend disbursing agent fees 19,836 29,753 9,917 24,795
Shareholders' servicing agent fees and expenses 58,357 91,606 22,863 33,821
Custodian's fees and expenses 54,210 102,846 35,394 52,107
Directors'/Trustees' fees and expenses (note 6) 4,040 8,874 2,112 3,696
Professional fees 10,549 11,993 9,944 10,798
Shareholders' reports - printing and mailing expenses 85,327 176,140 43,551 76,970
Stock exchange listing fees 16,239 33,724 12,031 16,140
Portfolio insurance expense 60,058 103,966 -- 13,461
Investor relations expense 36,520 75,448 18,058 31,020
Other expenses 22,637 45,491 11,752 19,020
- -----------------------------------------------------------------------------------------------------------------------------------
Total expenses 3,344,894 7,142,725 1,751,144 3,073,093
- -----------------------------------------------------------------------------------------------------------------------------------
Net investment income 21,668,295 47,370,354 11,019,707 17,915,480
- -----------------------------------------------------------------------------------------------------------------------------------
Realized and Unrealized Gain (Loss) from Investments
Net realized gain from investment transactions (notes 1 and 4)2,954,678 4,077,151 1,708,736 3,281,819
Net change in unrealized appreciation or
depreciation of investments (11,855,089) (26,336,702) (7,136,520) (10,309,314)
- -----------------------------------------------------------------------------------------------------------------------------------
Net gain (loss) from investments (8,900,411) (22,259,551) (5,427,784) (7,027,495)
- -----------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets from operations $12,767,884 $25,110,803 $ 5,591,923 $10,887,985
===================================================================================================================================
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
Statement of Changes in Net Assets
(Unaudited)
<CAPTION>
Insured Quality Insured Opportunity
- -----------------------------------------------------------------------------------------------------------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
4/30/99 10/31/98 4/30/99 10/31/98
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Operations
Net investment income $ 21,668,295 $ 44,617,562 $ 47,370,354 $ 97,070,050
Net realized gain from investment transactions
(notes 1 and 4) 2,954,678 6,071,593 4,077,151 4,892,106
Net change in unrealized appreciation or
depreciation of investments (11,855,089) 7,097,066 (26,336,702) 17,252,534
- -----------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets from operations 12,767,884 57,786,221 25,110,803 119,214,690
- -----------------------------------------------------------------------------------------------------------------------------------
Distributions to Shareholders (note 1)
From undistributed net investment income:
Common shareholders (17,316,814) (35,204,129) (38,299,915) (77,561,303)
Preferred shareholders (3,184,521) (9,554,564) (8,557,115) (20,642,256)
From accumulated net realized gains from
investment transactions:
Common shareholders (4,753,670) (453,849) (3,264,852) --
Preferred shareholders (1,322,344) (19,266) (864,520) --
- -----------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets from distributions to shareholders (26,577,349) (45,231,808) (50,986,402) (98,203,559)
- -----------------------------------------------------------------------------------------------------------------------------------
Capital Share Transactions (note 2)
Net proceeds from Common shares issued
to shareholders due to reinvestment of distributions 1,926,902 2,263,160 5,948,225 9,806,987
Preferred shares - net proceeds from sale of shares -- -- 79,074,482 --
- -----------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets from capital share transactions 1,926,902 2,263,160 85,022,707 9,806,987
- -----------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets (11,882,563) 14,817,573 59,147,108 30,818,118
Net assets at beginning of period 863,179,351 848,361,778 1,892,588,735 1,861,770,617
- -----------------------------------------------------------------------------------------------------------------------------------
Net assets at end of period $851,296,788 $863,179,351 $1,951,735,843 $1,892,588,735
===================================================================================================================================
Balance of undistributed net investment income at
end of period $ 1,774,580 $ 607,620 $ 1,513,812 $ 1,000,488
===================================================================================================================================
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
Statement of Changes in Net Assets (continued)
(Unaudited)
<CAPTION>
Premier Insured Income Insured Premium Income 2
- ------------------------------------------------------------------------------------------------------------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
4/30/99 10/31/98 4/30/99 10/31/98
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Operations
Net investment income $ 11,019,707 $ 22,329,463 $ 17,915,480 $ 35,542,409
Net realized gain from investment transactions
(notes 1 and 4) 1,708,736 980,248 3,281,819 5,306,267
Net change in unrealized appreciation or
depreciation of investments (7,136,520) 6,160,462 (10,309,314) 14,400,072
- -----------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets from operations 5,591,923 29,470,173 10,887,985 55,248,748
- -----------------------------------------------------------------------------------------------------------------------------------
Distributions to Shareholders (note 1)
From undistributed net investment income:
Common shareholders (8,653,377) (17,721,831) (13,522,287) (27,350,824)
Preferred shareholders (1,980,432) (4,817,384) (4,012,910) (9,249,566)
From accumulated net realized gains
from investment transactions:
Common shareholders (772,125) (400,607) -- --
Preferred shareholders (208,292) (110,068) -- --
- -----------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets from distributions to shareholders (11,614,226) (23,049,890) (17,535,197) (36,600,390)
- -----------------------------------------------------------------------------------------------------------------------------------
Capital Share Transactions (note 2)
Net proceeds from Common shares issued to
shareholders due to reinvestment of distributions 1,205,146 872,626 209,519 --
- -----------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets (4,817,157) 7,292,909 (6,437,693) 18,648,358
Net assets at beginning of period 450,466,027 443,173,118 793,861,578 775,213,220
- -----------------------------------------------------------------------------------------------------------------------------------
Net assets at end of period $445,648,870 $450,466,027 $787,423,885 $793,861,578
===================================================================================================================================
Balance of undistributed net investment income at
end of period $ 681,454 $ 295,556 $ 1,095,451 $ 715,168
===================================================================================================================================
See accompanying notes to financial statements.
</TABLE>
Notes to Financial Statements
(Unaudited)
1. General Information and Significant Accounting Policies
The National Funds (the "Funds") covered in this report and their corresponding
New York Stock Exchange symbols are Nuveen Insured Quality Municipal Fund, Inc.
(NQI), Nuveen Insured Municipal Opportunity Fund, Inc. (NIO), Nuveen Premier
Insured Municipal Income Fund, Inc. (NIF) and Nuveen Insured Premium Income
Municipal Fund 2 (NPX).
Each Fund invests primarily in a diversified portfolio of municipal obligations
issued by state and local government authorities. The Funds are registered under
the Investment Company Act of 1940 as closed-end, diversified management
investment companies.
The following is a summary of significant accounting policies followed by the
Funds in the preparation of their financial statements in accordance with
generally accepted accounting principles.
Securities Valuation
The prices of municipal bonds in each Fund's investment portfolio are provided
by a pricing service approved by the Fund's Board of Directors/Trustees. When
price quotes are not readily available (which is usually the case for municipal
securities), the pricing service establishes fair market value based on yields
or prices of municipal bonds of comparable quality, type of issue, coupon,
maturity and rating, indications of value from securities dealers and general
market conditions. Temporary investments in securities that have variable rate
and demand features qualifying them as short-term securities are valued at
amortized cost, which approximates market value.
Securities Transactions
Securities transactions are recorded on a trade date basis. Realized gains and
losses from such transactions are determined on the specific identification
method. Securities purchased or sold on a when-issued or delayed delivery basis
may have extended settlement periods. The securities so purchased are subject to
market fluctuation during this period. The Funds have instructed the custodian
to segregate assets in a separate account with a current value at least equal to
the amount of the when-issued and delayed delivery purchase commitments. At
April 30, 1999, Insured Quality and Insured Premium Income 2 had outstanding
delayed delivery and when-issued purchase commitments of $5,387,502 and
$7,860,949, respectively. There were no such outstanding purchase commitments in
either Insured Opportunity or Premier Insured Income.
Investment Income
Interest income is determined on the basis of interest accrued, adjusted for
amortization of premiums and accretion of discounts on long-term debt securities
when required for federal income tax purposes.
Federal Income Taxes
Each Fund is a separate taxpayer for federal income tax purposes. Each Fund
intends to comply with the requirements of the Internal Revenue Code applicable
to regulated investment companies and to distribute all of its tax-exempt net
investment income, in addition to any significant amounts of net realized
capital gains and/or market discount realized from investment transactions. The
Funds currently consider significant net realized capital gains and/or market
discount as amounts in excess of $.01 per Common share. Furthermore, each Fund
intends to satisfy conditions which will enable interest from municipal
securities, which is exempt from regular federal income tax, to retain such
tax-exempt status when distributed to shareholders of the Funds. Net realized
capital gain and market discount distributions are subject to federal taxation.
Dividends and Distributions to Shareholders
Tax-exempt net investment income is declared monthly as a dividend and payment
is made or reinvestment is credited to shareholder accounts on the first
business day after month-end. Net realized capital gains and/or market discount
from investment transactions, if any, are distributed to shareholders not less
frequently than annually. Furthermore, capital gains are distributed only to the
extent they exceed available capital loss carryforwards.
Distributions to shareholders of tax-exempt net investment income, net realized
capital gains and/or market discount are recorded on the ex-dividend date. The
amount and timing of distributions are determined in accordance with federal
income tax regulations, which may differ from generally accepted accounting
principles. Accordingly, temporary over-distributions as a result of these
differences may occur and will be classified as either distributions in excess
of net investment income, distributions in excess of net realized gains and/or
distributions in excess of net ordinary taxable income from investment
transactions, where applicable.
<PAGE>
Preferred Shares
The Funds have issued and outstanding $25,000 stated value Preferred shares.
Each Fund's Preferred shares are issued in more than one Series. The dividend
rate on each Series may change every seven days, as set by the auction agent.
The number of Preferred shares outstanding, by Series and in total, at April 30,
1999, is as follows:
Premier Insured
Insured Insured Insured Premium
Quality Opportunity Income Income 2
- ------------------------------------------------------------------------------
Number of shares:
Series M 2,600 4,000 -- 2,080
Series T 2,600 4,000 -- 2,200
Series W 2,600 4,000 -- 2,080
Series W2 -- 3,200* -- --
Series Th -- 4,000 2,800 2,200
Series Th2 -- 4,000 -- --
Series F 2,600 4,000 2,800 2,196
- ------------------------------------------------------------------------------
Total 10,400 27,200 5,600 10,756
==============================================================================
*Effective April 30, 1999, Insured Opportunity issued 3,200 Series W2 $25,000
stated value Preferred shares.
Effective May 7, 1999, Insured Quality issued 2,320 Series Th $25,000 stated
value Preferred shares.
Effective June 18, 1999, Premier Insured issued 840 Series W $25,000 stated
value Preferred shares.
Insurance
The Funds invest in municipal securities which are either covered by insurance
or are backed by an escrow or trust account containing sufficient U.S.
government or U.S. government agency securities, both of which ensure the timely
payment of principal and interest. Each insured municipal security is covered by
Original Issue Insurance, Secondary Market Insurance or Portfolio Insurance.
Such insurance does not guarantee the market value of the municipal securities
or the value of the Funds' shares. Original Issue Insurance and Secondary Market
Insurance remain in effect as long as the municipal securities covered thereby
remain outstanding and the insurer remains in business, regardless of whether
the Funds ultimately dispose of such municipal securities. Consequently, the
market value of the municipal securities covered by Original Issue Insurance or
Secondary Market Insurance may reflect value attributable to the insurance.
Portfolio Insurance is effective only while the municipal securities are held by
the Funds. Accordingly, neither the prices used in determining the market value
of the underlying municipal securities nor the net asset value of the Funds'
shares include value, if any, attributable to the Portfolio Insurance. Each
policy of the Portfolio Insurance does, however, give the Funds the right to
obtain permanent insurance with respect to the municipal security covered by the
Portfolio Insurance policy at the time of its sale.
Derivative Financial Instruments
The Funds may invest in certain derivative financial instruments including
futures, forward, swap and option contracts, and other financial instruments
with similar characteristics. Although the Funds are authorized to invest in
such financial instruments, and may do so in the future, they did not make any
such investments during the six months ended April 30, 1999.
Use of Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of increases and decreases in net
assets from operations during the reporting period. Actual results may differ
from those estimates.
<PAGE>
2. Fund Shares
Transactions in Common and Preferred shares were as follows:
<TABLE>
<CAPTION>
Insured Quality Insured Opportunity
- -------------------------------------------------------------------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
4/30/99 10/31/98 4/30/99 10/31/98
- -------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares issued to shareholders
due to reinvestment
of distributions 120,648 140,631 360,616 606,60
===========================================================================================
<CAPTION>
Premier Insured Income Insured Premium Income 2
- -------------------------------------------------------------------------------------------
Six Months Ended Year Ended Six Months Ended Year Ended
4/30/99 10/31/98 4/30/99 10/31/98
- -------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares issued to shareholders
due to reinvestment
of distributions 73,559 54,102 14,923 --
===========================================================================================
</TABLE>
Insured Opportunity issued 3,200 Series W2 Preferred shares during the six
months ended April 30, 1999.
3. Distributions to Common Shareholders
The Funds declared Common share dividend distributions from their tax-exempt net
investment income which were paid on June 1, 1999, to shareholders of record on
May 15, 1999, as follows:
Premier Insured
Insured Insured Insured Premium
Quality Opportunity Income Income 2
- ------------------------------------------------------------------------------
Dividend per share $.0765 $.0775 $.0750 $.0605
==============================================================================
4. Securities Transactions
Purchases and sales (including maturities) of investments in long-term municipal
securities and temporary municipal securities for the six months ended April 30,
1999, were as follows:
<TABLE>
<CAPTION>
Premier Insured
Insured Insured Insured Premium
Quality Opportunity Income Income 2
- ----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Purchases:
Long-term municipal securities $84,126,591 $201,025,021 $47,311,630 $131,610,313
Temporary municipal securities 40,400,000 106,250,000 23,200,000 63,000,000
Sales and Maturities:
Long-term municipal securities 91,460,920 205,086,169 45,203,687 134,369,332
Temporary municipal securities 32,500,000 116,750,000 25,100,000 56,300,000
==============================================================================================
</TABLE>
At April 30, 1999, the identified cost of investments owned for federal income
tax purposes was the same as the cost for financial reporting purposes for each
Fund.
At October 31, 1998, the Funds' last fiscal year end, Insured Premium Income 2
had unused capital loss carryforwards of $16,029,037 available for federal
income tax purposes to be applied against future capital gains, if any. If not
applied, $1,918,696 of the carryforward will expire in the year 2002,
$12,029,555 will expire in the year 2003 and $2,080,786 will expire in the year
2004.
5. Unrealized Appreciation (Depreciation)
Gross unrealized appreciation and gross unrealized depreciation of investments
at April 30, 1999, were as follows:
<TABLE>
<CAPTION>
Premier Insured
Insured Insured Insured Premium
Quality Opportunity Income Income 2
- -------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Gross unrealized:
appreciation $59,545,680 $140,611,848 $36,290,198 $40,373,639
depreciation (260,643) (1,154,737) (481,636) (567,133)
- -------------------------------------------------------------------------------------------
Net unrealized appreciation $59,285,037 $139,457,111 $35,808,562 $39,806,506
===========================================================================================
</TABLE>
<PAGE>
6. Management Fee and Other Transactions with Affiliates
Under the Funds' investment management agreements with Nuveen Advisory Corp.
(the "Adviser"), a wholly owned subsidiary of The John Nuveen Company, each Fund
pays an annual management fee, payable monthly, at the rates set forth below,
which are based upon the average daily net asset value of each Fund:
Average Daily Net Asset Value Management Fee
- -------------------------------------------------------------------------------
For the first $125 million .6500 of 1%
For the next $125 million .6375 of 1
For the next $250 million .6250 of 1
For the next $500 million .6125 of 1
For the next $1 billion .6000 of 1
For net assets over $2 billion .5875 of 1
===============================================================================
The fee compensates the Adviser for overall investment advisory and
administrative services and general office facilities. The Funds pay no
compensation directly to those of its Directors/Trustees who are affiliated with
the Adviser or to their officers, all of whom receive remuneration for their
services to the Funds from the Adviser.
7. Composition of Net Assets At April 30, 1999, net assets consisted of:
<TABLE>
<CAPTION>
Premier Insured
Insured Insured Insured Premium
Quality Opportunity Income Income 2
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Preferred shares, $25,000 stated value per share,
at liquidation value $260,000,000 $ 680,000,000 $140,000,000 $268,900,000
Common shares, $.01 par value per share 377,781 809,485 192,618 372,540
Paid-in surplus 526,936,533 1,125,881,159 267,258,184 490,091,220
Balance of undistributed net investment income 1,774,580 1,513,812 681,454 1,095,451
Accumulated net realized gain (loss) from
investment transactions 2,922,857 4,074,276 1,708,052 (12,841,832)
Net unrealized appreciation of investments 59,285,037 139,457,111 35,808,562 39,806,506
- -----------------------------------------------------------------------------------------------------------------
Net assets $851,296,788 $1,951,735,843 $445,648,870 $787,423,885
=================================================================================================================
Authorized shares:
Common 200,000,000 200,000,000 200,000,000 Unlimited
Preferred 1,000,000 1,000,000 1,000,000 Unlimited
=================================================================================================================
</TABLE>
<PAGE>
<TABLE>
8. Investment Composition
At April 30, 1999, the revenue sources by municipal purpose, expressed as a
percent of long-term investments, were as follows:
<CAPTION>
Premier Insured
Insured Insured Insured Premium
Quality Opportunity Income Income 2
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Education and Civic Organizations 3% 1% 2% 1%
Health Care 16 17 11 10
Housing/Multifamily 4 3 5 9
Housing/Single Family 11 11 5 6
Tax Obligation/General 7 3 2 17
Tax Obligation/Limited 7 4 16 8
Transportation 11 9 5 9
U.S. Guaranteed 22 31 35 14
Utilities 17 15 17 23
Water and Sewer 2 5 1 3
Other -- 1 1 --
- ---------------------------------------------------------------------------------------------------------
100% 100% 100% 100%
=========================================================================================================
All of the long-term and intermediate-term investments owned by the Funds are
either covered by insurance issued by several private insurers or are backed by
an escrow or trust containing U.S. government or U.S. government agency
securities, both of which ensure the timely payment of principal and interest in
the event of default. Such insurance or escrow, however, does not guarantee the
market value of the municipal securities or the value of the Funds' shares.
For additional information regarding each investment security, refer to the
Portfolio of Investments of each Fund.
</TABLE>
<PAGE>
<TABLE>
Financial Highlights
(Unaudited)
Selected data for a Common share outstanding throughout each
period is as follows:
<CAPTION>
Investment Operations
Net
Realized/
Beginning Net Unrealized
Net Asset Investment Investment
Value Income Gain (Loss) Total
<S> <C> <C> <C> <C>
Insured Quality
Year Ended 10/31:
1999 (a) $16.02 $ .57 $ (.23) $ .34
1998 15.68 1.18 .36 1.54
1997 15.50 1.22 .28 1.50
1996 15.79 1.24 (.12) 1.12
1995 14.50 1.27 1.32 2.59
1994 16.58 1.27 (2.04) (.77)
<CAPTION>
Insured Opportunity
<S> <C> <C> <C> <C>
Year Ended 10/31:
1999 (a) 16.04 .59 (.28) .31
1998 15.78 1.21 .28 1.49
1997 15.54 1.23 .28 1.51
1996 15.60 1.24 .02 1.26
1995 14.04 1.25 1.60 2.85
1994 16.24 1.24 (2.18) (.94)
<CAPTION>
Premier Insured Income
<S> <C> <C> <C> <C>
Year Ended 10/31:
1999 (a) 16.18 .57 (.28) .29
1998 15.84 1.16 .38 1.54
1997 15.49 1.19 .36 1.55
1996 15.53 1.19 (.03) 1.16
1995 14.05 1.20 1.51 2.71
1994 16.28 1.19 (2.21) (1.02)
<CAPTION>
Insured Premium Income 2
<S> <C> <C> <C> <C>
Year Ended 10/31:
1999 (a) 14.10 .48 (.19) .29
1998 13.60 .95 .53 1.48
1997 13.04 1.00 .54 1.54
1996 13.03 .99 -- .99
1995 10.99 1.00 2.08 3.08
1994 14.29 .98 (3.16) (2.18)
<PAGE>
<CAPTION>
Less Distributions
Net Net Organization and
Investment Investment Capital Capital Offering Costs and
Income Income Gains Gains Preferred Share
To Common To Preferred To Common To Preferred Underwriting
Shareholders Shareholders+ Shareholders Shareholders+ Total Discounts
<S> <C> <C> <C> <C> <C> <C>
Insured Quality
Year Ended 10/31:
1999 (a) $ (.46) $(.08) $(.13) $(.04) $ (.71) $--
1998 (.94) (.25) (.01) -- (1.20) --
1997 (.98) (.25) (.07) (.02) (1.32) --
1996 (.98) (.25) (.14) (.04) (1.41) --
1995 (1.01) (.29) -- -- (1.30) --
1994 (1.04) (.26) (.01) -- (1.31) --
<CAPTION>
Insured Opportunity
<S> <C> <C> <C> <C> <C> <C>
Year Ended 10/31:
1999 (a) (.47) (.11) (.04) (.01) (.63) (.01)
1998 (.97) (.26) -- -- (1.23) --
1997 (.98) (.26) (.02) (.01) (1.27) --
1996 (.98) (.26) (.06) (.02) (1.32) --
1995 (.98) (.31) -- -- (1.29) --
1994 (1.00) (.25) (.01) -- (1.26) --
<CAPTION>
Premier Insured Income
<S> <C> <C> <C> <C> <C> <C>
Year Ended 10/31:
1999 (a) (.45) (.10) (.04) (.01) (.60) --
1998 (.92) (.25) (.02) (.01) (1.20) --
1997 (.94) (.26) -- -- (1.20) --
1996 (.94) (.26) -- -- (1.20) --
1995 (.94) (.29) -- -- (1.23) --
1994 (.96) (.25) -- -- (1.21) --
<CAPTION>
Insured Premium Income 2
<S> <C> <C> <C> <C> <C> <C>
Year Ended 10/31:
1999 (a) (.36) (.11) -- -- (.47) --
1998 (.73) (.25) -- -- (.98) --
1997 (.73) (.25) -- -- (.98) --
1996 (.71) (.27) -- -- (.98) --
1995 (.75) (.29) -- -- (1.04) --
1994 (.78) (.20) -- -- (.98) (.14)
<PAGE>
<CAPTION>
Total Returns
Ending Ending
Net Asset Ending Based on Based on Net Net Assets
Value Market Value Market Value** Asset Value** (000)
<S> <C> <C> <C> <C> <C>
Insured Quality
Year Ended 10/31:
1999 (a) $15.65 $15.8750 5.38% 1.37% $ 851,297
1998 16.02 15.6250 6.13 8.43 863,179
1997 15.68 15.6250 10.57 8.22 848,362
1996 15.50 15.1250 8.54 5.49 839,304
1995 15.79 15.0000 22.62 16.43 849,583
1994 14.50 13.1250 (19.13) (6.43) 801,482
<CAPTION>
Insured Opportunity
<S> <C> <C> <C> <C> <C>
Year Ended 10/31:
1999 (a) 15.71 16.2500 .84 1.16 1,951,736
1998 16.04 16.6250 12.03 7.99 1,892,589
1997 15.78 15.7500 10.18 8.32 1,861,771
1996 15.54 15.2500 9.77 6.50 1,837,731
1995 15.60 14.8750 22.78 18.74 1,841,780
1994 14.04 13.0000 (13.60) (7.59) 1,717,023
<CAPTION>
Premier Insured Income
<S> <C> <C> <C> <C> <C>
Year Ended 10/31:
1999 (a) 15.87 16.0000 (2.29) 1.13 445,649
1998 16.18 16.8750 14.06 8.35 450,466
1997 15.84 15.6875 12.09 8.56 443,173
1996 15.49 14.8750 9.23 5.93 436,134
1995 15.53 14.5000 24.14 17.73 436,920
1994 14.05 12.5000 (14.53) (8.06) 408,690
<CAPTION>
Insured Premium Income 2
<S> <C> <C> <C> <C> <C>
Year Ended 10/31:
1999 (a) 13.92 13.1250 (1.53) 1.31 787,424
1998 14.10 13.6875 16.35 9.28 793,862
1997 13.60 12.4375 15.45 10.15 775,213
1996 13.04 11.4380 6.95 5.70 754,329
1995 13.03 11.3750 23.46 26.20 427,908
1994 10.99 9.8750 (23.99) (18.24) 385,692
<PAGE>
<CAPTION>
Ratios/Supplemental Data
Ratio of Net Ratio of Net
Ratio of Investment Ratio of Investment
Expenses to Income to Expenses to Income to
Average Average Average Total Average Total
Net Assets Net Assets Net Assets Net Assets Portfolio
Applicable to Applicable to Including Including Turnover
Common Shares++ Common Shares++ Preferred++ Preferred++ Rate
<S> <C> <C> <C> <C> <C>
Insured Quality
Year Ended 10/31:
1999 (a) 1.13%* 7.33%* .79%* 5.10%* 10%
1998 1.13 7.49 .79 5.21 16
1997 1.15 7.88 .79 5.44 8
1996 1.17 7.98 .80 5.50 33
1995 1.19 8.36 .81 5.73 30
1994 1.19 8.17 .82 5.64 22
<CAPTION>
Insured Opportunity
<S> <C> <C> <C> <C> <C>
Year Ended 10/31:
1999 (a) 1.12* 7.45* .76* 5.07* 11
1998 1.13 7.60 .77 5.17 12
1997 1.15 7.92 .78 5.34 8
1996 1.16 8.01 .78 5.38 18
1995 1.19 8.43 .79 5.59 16
1994 1.18 8.14 .79 5.44 20
<CAPTION>
Premier Insured Income
<S> <C> <C> <C> <C> <C>
Year Ended 10/31:
1999 (a) 1.15* 7.21* .79 4.96 10
1998 1.16 7.29 .79 5.00 10
1997 1.17 7.61 .80 5.18 4
1996 1.18 7.70 .80 5.22 3
1995 1.20 8.05 .81 5.40 5
1994 1.20 7.86 .81 5.30 4
<CAPTION>
Insured Premium Income 2
<S> <C> <C> <C> <C> <C>
Year Ended 10/31:
1999 (a) 1.19* 6.92* .78* 4.57* 17
1998 1.20 6.89 .79 4.53 31
1997 1.23 7.55 .80 4.89 37
1996 1.36 7.53 .86 4.78 32
1995 1.37 8.29 .83 5.07 30
1994 1.32 7.67 .83 4.83 25
* Annualized.
** Total Investment Return on Market Value is the combination of reinvested
dividend income, reinvested capital gains distributions, if any, and
changes in stock price per share.
Total Return on Net Asset Value is the combination of reinvested dividend
income, reinvested capital gains distributions, if any, and changes in net
asset value per share.
Total returns are not annualized.
+ The amounts shown are based on Common share equivalents.
++ Ratios do not reflect the effect of dividend payments to Preferred
shareholders; income ratios reflect income earned on assets attributable to
Preferred shares.
(a) For the six months ended April 30, 1999.
</TABLE>
<PAGE>
Building a Better Portfolio
Can Make You a Successful Investor
Nuveen Family of Mutual Funds
Nuveen offers a variety
of funds designed to
help you reach your
financial goals.
Growth
Nuveen Rittenhouse
Growth Fund
Growth and Income
European Value Fund
Growth and
Income Stock Fund
Balanced Stock
and Bond Fund
Balanced Municipal
and Stock Fund
Dividend and
Growth Fund
Income
Income Fund
Tax-Free Income
National Funds
Long-Term
Insured
Intermediate-Term
Limited-Term
State Funds
Arizona
California
Colorado
Connecticut
Florida
Georgia
Kansas
Kentucky
Louisiana
Maryland
Massachusetts
Michigan
Missouri
New Jersey
New Mexico
New York
North Carolina
Ohio
Pennsylvania
Tennessee
Virginia
Wisconsin
Successful investors know that a well-diversified portfolio - one that balances
different types of investments, levels of risk and tax management - can be the
foundation for building and sustaining wealth. That's why Nuveen offers you and
your financial adviser a wide range of quality investments that can help you
build a better portfolio in the pursuit of your financial goals
Exchange-Traded Funds
Nuveen Exchange-Traded Funds offer investors actively managed portfolios of
investment-grade quality municipal bonds. The fund shares are listed and traded
on the New York and American stock exchanges. Exchange-traded funds provide the
investment convenience, price visibility and liquidity of common stocks.
MuniPreferred(R)
Nuveen MuniPreferred offers investors a AAA rated investment with an attractive
tax-free yield for the cash reserves portion of an investment portfolio.
MuniPreferred shares are backed 2-to-1 by the long-term portfolios of Nuveen
dual-class exchange-traded funds and are available for national as well as a
wide variety of state-specific portfolios.
Mutual Funds
Nuveen offers a family of equity, balanced and municipal bond funds featuring
Premier AdvisersSM including Institutional Capital Corporation, Rittenhouse
Financial Services, and Nuveen Advisory Corp. Each brings a specialized
expertise in a particular investment style or asset class, time-tested
investment strategies and a focus on consistent, long-term performance. With
Nuveen's Premier Adviser funds, you have all the advantages of a family of funds
plus the benefits of specialized investment expertise.
Private Asset Management
Rittenhouse Financial Services and Nuveen Asset Management offer comprehensive,
customized investment management solutions to investors with assets of $250,000
or more to invest. A range of actively managed growth, balanced and municipal
income-oriented portfolios are available, all based upon a disciplined
investment philosophy.
Defined Portfolios
Nuveen Defined Portfolios are fixed portfolios of quality securities that are a
convenient, attractive alternative to purchasing individual securities. They
provide low-cost diversification to reduce risk, while also offering
experienced, professional security selection and surveillance. In addition,
Nuveen Defined Portfolios provide daily liquidity at that day's net asset value
for quick access to your assets.
<PAGE>
Fund Information
Board of Directors/Trustees
Robert P. Bremner
Lawrence H. Brown
Anne E. Impellizzeri
Peter R. Sawers
William J. Schneider
Timothy R. Schwertfeger
Judith M. Stockdale
Fund Manager
Nuveen Advisory Corp.
333 West Wacker Drive
Chicago, IL 60606
Custodian, Transfer Agent
and Shareholder Services
The Chase Manhattan Bank
4 New York Plaza
New York, NY 10004-2413
(800) 257-8787
Legal Counsel
Morgan, Lewis &
Bockius LLP
Washington, D.C.
Independent Auditors
Ernst & Young LLP
Chicago, IL
Year 2000
The concern that computer systems may have problems processing date-related
information in the year 2000 and beyond has challenged businesses and
organizations to thoroughly review all aspects of their operations. We have
undertaken just such an approach at Nuveen in preparation for the millennium.
Over the last 10 years, we have updated or replaced our trading, fund
management, and pricing systems at Nuveen - systems that directly affect our
investors and their financial advisers - to address Year 2000 concerns.
We continue to work closely with our transfer agent, custodian, firms through
whom we buy and sell portfolio securities, and other service partners to monitor
the Year 2000 readiness of their systems, while addressing other remaining
systems issues.
In addition, the Funds hold securities of issuers whose business operations
leave them susceptible to Year 2000 concerns. We seek to evaluate an issuer's
Year 2000 readiness as part of our initial and ongoing research of these
issuers. This is only one of the many factors considered in determining whether
to buy, sell, or continue holding a particular security.
We anticipate that all significant components of our Year 2000 review, repair,
and testing program will be complete by mid-1999. This includes appropriate
industry-wide testing of critical systems and receipt of satisfactory assurances
from critical service providers, vendors, and issuers regarding their Year 2000
readiness. We are also making Year 2000 contingency plans to guide recovery
efforts in the event that, despite our remediation attempts, Year 2000 issues
adversely affect the Funds. Although we cannot give complete assurance at this
time that the steps we take will be sufficient to prevent any problems that
would impact the Nuveen Exchange-Traded Funds, we can assure you that we will
take all reasonable steps to prevent disruption of the services provided by your
Fund.
Each fund intends to repurchase shares of its own common or preferred stock in
the future at such times and in such amounts as is deemed advisable. No shares
were repurchased during the six-month period ended April 30, 1999. Any future
repurchases will be reported to shareholders in the next annual or semiannual
report.
<PAGE>
Serving Investors for Generations
Photo of: John Nuveen, Sr.
Since our founding in 1898, John Nuveen & Co. has been synonymous with
investments that withstand the test of time. Today we offer a broad range of
quality investments designed for individuals seeking to build and sustain
wealth. In fact, more than 1.3 million investors have trusted Nuveen to help
them pursue their financial goals.
The cornerstone of Nuveen's investment philosophy is a commitment to disciplined
long-term investment strategies focused on providing consistent, attractive
performance over time - with moderated risk. We emphasize quality securities
carefully chosen through in-depth research, and we follow those securities
closely over time to ensure that they continue to meet our exacting standards.
Whether your focus is long-term growth, dependable current income or sustaining
accumulated wealth, Nuveen offers a wide variety of investments and services to
help meet your unique circumstances and financial planning needs. Our equity,
balanced, and tax-free income funds, along with our defined portfolios and
private asset management, can help you build a better, well-diversified
portfolio.
Talk with your financial adviser to learn more about how Nuveen investment
products and services can help you. Or call us at (800) 257-8787 for more
information, including a prospectus where applicable. Please read that
information carefully before investing.
Logo:
NUVEEN
helping investors sustain the wealth of a lifetime(tm).
John Nuveen & Co. Incorporated
333 West Wacker Drive
Chicago, IL 60606-1286
www.nuveen.com
FSA-4-4-99
