Nuveen Exchange-Traded Funds
Providing tax-free income to help you live your dreams.
NUVEEN INSURED QUALITY MUNICIPAL FUND, INC.
NUVEEN INSURED MUNICIPAL OPPORTUNITY FUND, INC.
NUVEEN PREMIER INSURED MUNICIPAL INCOME FUND, INC.
NUVEEN INSURED PREMIUM INCOME MUNICIPAL FUND, INC.
NUVEEN INSURED PREMIUM INCOME MUNICIPAL FUND 2
ANNUAL REPORT/OCTOBER 31, 1995
Photographic image of man seated at breakfast table with wife standing behind
him.
<PAGE>
Photographic image of Nuveen Research Department. Four people around a table
working.
Research: a foundation
Your financial plan is in place. You and your adviser have made asset
allocation decisions. For the tax-free portion of your portfolio, you want
dependable income, safety of principal, and diversification. Solid, reliable
Nuveen research helps to keep your tax-free investments on the path you have
chosen.
Paul Williams, Vice President and Manager of Investment Strategies and
Research, emphasizes fundamental research as a strategy for finding value.
<PAGE>
The strength of Nuveen's Research Department is illustrated by the numerous
awards and press coverage we receive. Annual industry polls consistently
recognize the quality and depth of Nuveen Research.
Photographic image of a grouping of awards/statuettes.
At Nuveen, we believe that attention to detail combined with years of
experience is the foundation for sound research. Sound research means finding
quality bonds that deliver timely and dependable income over many decades.
Beyond this, it means adding value by identifying bonds whose credit strengths
are not yet understood by the market.
USING RESEARCH TO TRACK QUALITY AND VALUE
With tens of thousands of bonds available for investment today, the municipal
market is one of the nation's largest--and most complex--securities markets.
At the same time, the number of analysts devoted to researching the municipal
market is comparatively small. While more than 12,000 analysts at nearly 2,000
firms and investment organizations research the 7,500 common stocks available
in the equity market, approximately 1,000 analysts at 400 firms and rating
agencies cover 60,000 municipal bond issues.
Selecting those bonds that will outperform the market and help you achieve
your investment goals depends upon an ability to analyze and understand
complexities ranging from the demand for a new highway or airport to the
impact of an industry closure on the financial position of a town's water and
sewer system.
At Nuveen, we can provide this depth because we have the largest research
staff in the investment banking industry devoted exclusively to the analysis
of municipal bonds. Our award-winning team of more than 30 research
professionals provides invaluable support to our portfolio managers, assisting
them in careful analysis of bond issues considered for purchase--even those
rated AAA.
On a daily basis, our research analysts prepare credit reviews to assist in
the selection of bonds that offer the best combination of yield and security,
monitor the continued creditworthiness of portfolio holdings, and analyze
economic, political, and demographic trends affecting the markets.
The scope of this analysis is broad. We understand the beneficial insights
that can be obtained by assessing the impact of local elections in small towns
or gaining an understanding of the global wood pulp market to accurately
evaluate a municipal issue in Alaska. Recently a financial adviser noticed a
large number of clippings on salmon fishing on one Nuveen analyst's desk. The
analyst explained that the articles provided information on salmon spawning, a
conservation issue having a major impact on public hydroelectric projects in
the Pacific Northwest. With the largest research staff in the industry, we can
analyze subtle but essential details such as this--and apply our findings to
enhance the performance of your portfolio.
<PAGE>
BENEFITING OUR INVESTORS
The Nuveen Research Department supports the investment goals of fund investors
through three major activities:
Primary research and surveillance
Every year, our research staff reviews thousands of tax-exempt issues valued
at more than $100 billion to help our portfolio managers select the most
appropriate bonds based on current yield, price, credit quality, and future
prospects.
A recent example of the way Nuveen Research benefits our shareholders was
our successful investment in Philadelphia water and sewer bonds. When the city
decided to issue bonds to fund badly needed capital improvements, the city's
fiscal difficulties resulted in an issue that was priced below that of other
cities for similar bonds, generating higher income. However, Nuveen's own
research performed independently from the rating agencies indicated that the
city water and sewer system was economically sound and that adequate legal
safeguards would be in place to protect the investment. Following the
completion of the improvements, the prices of these bonds resulted in a
sizable portfolio gain to our shareholders.
Research reports
Just as you rely on your financial adviser for seasoned, prudent advice,
financial advisers depend on Nuveen's research reports to keep current on
market developments. Reports cover issues ranging from credit analysis of
specific states to comprehensive examinations of tax-free investment
strategies and the impact of national and state elections on municipal issues.
(For a list of research reports currently available to you and your adviser,
please refer to the attached reply card.)
Investor interests
We take our responsibility to our shareholders seriously by actively
representing their interests before the industry and government groups that
oversee and regulate the markets. We testified before a U.S. Senate
subcommittee to support better disclosure of financial information by bond
issuers. Our analysis of the effect of the Orange County bankruptcy on other
California issuers helped a California Senate subcommittee understand the
importance of fiscal conservatism and prudent policy decisions. By providing
informed opinions backed by years of experience, we help to define and set
policy that benefits you.
At Nuveen, quality research is one of the core elements of our disciplined
approach to providing you with dependable income, credit quality, and
diversification--key elements of a successful investment program.
Nuveen's research reports are often used by the press as background when
covering the municipal market in depth.
Photographic image of a grouping of research reports and newspapers.
<PAGE>
Photographic image of man seated at breakfast table with wife standing behind
him.
CONTENTS
6 Municipal market perspective
7 Dear shareholder
9 Answering your questions
14 Fund performance
17 Commonly used terms
19 Shareholder meeting report
20 Portfolio of investments
51 Statement of net assets
53 Statement of operations
55 Statement of changes in net assets
58 Notes to financial statements
70 Financial highlights
72 Report of independent auditors
73 Nuveen Exchange-Traded Funds dividend reinvestment program
<PAGE>
Municipal market perspective
The start of 1995 brought with it a turnaround in the bond market, concluding
one of the worst periods in recent bond market history. This rebound reflects
a general consensus that inflation is under control following an unprecedented
series of seven interest rate hikes by the Federal Reserve Board over a
twelve-month period.
In early July, the Federal Reserve reacted to the slowing economy by making a
much-anticipated move to ease short-term rates, the first such reduction in
nearly three years. Further rate cuts remain a possibility, as the Fed keeps a
close eye on the strength of the expanding economy and the outcome of
Congressional efforts to balance the federal budget.
In the municipal bond market, prospects of another Fed easing helped
municipals gain momentum toward year end, despite an exceptionally strong
stock market and continued debate about potential tax reform legislation.
Inflation for the year remained low, a benefit to bondholders.
<PAGE>
Dear shareholder
Photographic image of Richard Franke, Chairman of Nuveen.
"Over time, municipal bonds have proven to be a valuable and dependable
component of successful investment programs."
Since the beginning of 1995, we have enjoyed a welcome rebound in the bond
markets, as we put behind us 1994--a very volatile period in bond market
history. This period serves as a reminder that weathering the ups and downs of
the markets is a normal part of the investment process. We can gain a better
perspective on this process if we remember one of the basic principles of
investing: A financial plan that focuses on your long-term goals can minimize
the impact of any short-term market volatility.
Municipal bond funds continue to be an attractive way to invest for the long
term, offering steady tax-free income and diversification across market
sectors. Throughout the past year, we have kept our sights focused on
successfully meeting these objectives, providing you with a solid source of
current income, credit quality, and enhanced share price relative to the
market as a whole.
As of October 31, 1995, current yields on share prices for the funds covered
in this report ranged from 6.31% to 6.76%. To match these yields, an investor
in the 36% federal income tax bracket would have had to earn at least 9.86% on
taxable alternatives of comparable quality. Without question, taxable yields
at these levels on investments of comparable quality are difficult to achieve
in today's markets.
Reflecting the rebound in the bond market, each of these funds reported
gains in net asset value over October 31, 1994, as well as substantial
increases in share price. The 12-month total returns on net asset value,
reflecting share price gains plus reinvested dividend income, ranged from
16.43% to 26.20%, which translates to 20.49% to 30.14% on a taxable-equivalent
basis. These performance results remind us of the important role that
municipal bonds--and the tax-free income they provide--can play as part of an
investment strategy focused on diversification and long-term performance.
<PAGE>
The value and dependability of your municipal bond investments are enhanced
by the fact that you have chosen tax-free exchange-traded funds managed by
Nuveen. We offer a combination of professional management, award-winning
research, and shareholder service that distinguishes Nuveen as a fund manager.
Our portfolio management strategy, which we call value investing, relies on
a disciplined approach to security selection and portfolio construction
designed to deliver above-market performance by emphasizing securities that
are underpriced or undervalued by the market. This approach is supported by
the strength of Nuveen Research, which provides the insights and experience to
assist portfolio managers in identifying and selecting bonds with strong
credit quality. Our research professionals continually monitor our holdings in
order to alert portfolio managers about changes that may affect quality.
Nuveen also prides itself on its exceptional service to shareholders.
Through annual and semiannual reports, regular statements, as well as our
toll-free information lines, our communication programs help us stay in touch
with your needs and concerns. We also provide support to financial advisers
across the nation by supplying them with the information they need to answer
your questions and ensure that products are selected to meet your needs. Our
educational reports--covering issues such as credit analyses, tax-free
investment strategies, and tax reform proposals--are available to both you and
your adviser to keep you current on market developments.
As you review the following pages detailing the solid performance of your
funds, we trust you will come away with the feeling that these results,
coupled with Nuveen's continued pledge of premium service, add up to a
rewarding investment experience. We look forward to serving your tax-free
investment needs in the future.
Sincerely,
Richard J. Franke
Chairman of the Board
December 15, 1995
<PAGE>
Answering your questions
Photographic image of montage of letters received by Nuveen.
Tom Spalding, head of Nuveen's portfolio management team, offers insights into
value investing and the bond market recovery.
How has the recovery of the municipal bond market affected Nuveen funds?
In short, the market recovery has helped most Nuveen funds regain some of the
share price they lost during 1994's market. To put this in perspective, the
setback in the bond market last year--which goes on record as one of the most
volatile periods in decades--was the first downturn experienced by many Nuveen
exchange-traded fund investors, and some reacted by selling their shares.
This, in turn, drove share prices down even further. Since the beginning of
the recovery in early 1995, however, municipal bond prices have increased and
most Nuveen funds have seen their prices rise 12% to 15%.
Because of their capital structure, leveraged funds such as the ones covered
in this report experienced greater price declines in 1994 than unleveraged
funds, and they generally responded more quickly to the stabilizing interest
rate environment with recovering prices.
Photographic image of Tom Spalding, Portfolio Manager at Nuveen.
Tom Spalding, head of Nuveen's portfolio management team, answers investors'
questions on developments in the municipal market.
<PAGE>
Why do these funds continue to trade at a discount despite the recovery?
To understand why this is happening, it may be helpful to remember that each
share has two prices: the net asset value (NAV), which represents the
underlying value--or the sum of assets and liabilities--of the fund, and the
share price, which reflects the market's assessment of the fund.
As the market turned around in 1995, net asset values appreciated more
quickly than share prices. This is typical of a market that sometimes takes a
while to recognize underlying value balanced against the various factors that
affect share price, such as interest rates, inflation forecasts, the relative
strength of the stock market, or the legislative and tax outlook. The fact
that gains in NAVs are currently outpacing the rate of change in share prices
means that the market is lagging in recognizing the value currently offered by
municipal bonds.
Investors in the Nuveen national funds should be aware that the net asset
values for these funds, as shown in this report, remain quite strong. For
long-term investors, in fact, the current period may present a buying
opportunity, as shares can be purchased at prices lower than their underlying
value--and at a time when the bond market is strong.
What does Nuveen mean by "value investing"? Where are Nuveen analysts finding
value today?
At Nuveen, we define value investing as a disciplined approach to security
selection and portfolio construction designed to deliver above-market
performance. We emphasize securities that offer good intrinsic value but that
are underpriced or undervalued by the market. Our value investing approach
concentrates on identifying individual bonds with current yields, prices,
credit quality, and future prospects that are exceptionally attractive in
relation to other bonds in the market.
As we search for value in the market today, our analysts continue to assess
investment potential across the entire spectrum of geographical and sector
opportunities. During 1995, we have seen many credit upgrades on portfolio
holdings, meaning that our judgments about credit quality have been rewarded.
We currently favor revenue bonds, which offer a dedicated revenue stream--such
as tollways or recycling plants, over general obligation bonds, which rely on
the taxing power of a state or municipality. One example of revenue bonds that
have performed exceptionally well for us recently are those issued for the
Denver International Airport.
<PAGE>
What does Nuveen see as the impact of the flat tax proposals?
We have been closely monitoring the various flat tax proposals currently being
debated in Congress and their implications for tax-free funds. Four major tax
reform proposals are currently under discussion, all with the common goal of
simplifying the federal tax code and increasing incentives for saving and
investment. It is important to note that none of the proposals has gained a
strong consensus and implementation of any measure that manages to pass both
houses is at least two years away. We believe that some action on the tax
reform front is likely, as the federal tax laws are constantly being
reevaluated and revised, although changes of the magnitude outlined in current
proposals are rare.
As we look at the bond market today, we can see some evidence that the
market is already compensating investors for the uncertainty of tax reform.
Yields on municipal bonds are currently at a level equal to 90% or more of
Treasury bond yields, a historically high level. These yields are comparable
to taxable yields in the 10% range, providing good value that is tough to
match.
Once the tax issue is resolved, we're confident that municipal
bonds--because of their high credit quality and attractive yields--will
continue to hold a strategic place in the prudent investor's portfolio. The
importance of municipal bonds is enhanced by the integral role they play in
maintaining our way of life in this country. Our cities, counties, and states
will always have a need for financing to build and upgrade projects such as
roads, hospitals, and water treatment systems. And municipal bonds will
continue to be an essential way to match America's long-term needs for capital
improvements with investors' long-term needs for secure income.
What is Nuveen's outlook as we head into 1996?
Inflation remains low and the economy seems to be expanding at a reasonable
pace; and, while both of these factors can change and have an impact on the
bond market, the current environment is favorable for bonds. While municipal
supply is down from past years, demand from institutional investors such as
insurance companies has been strong in 1995, contributing to the rebound in
municipal prices. If we experience continued slow and steady economic growth,
combined with low inflation and stable interest rates, that may attract
greater numbers of individual investors as well.
<PAGE>
<TABLE>
NUVEEN INSURED QUALITY MUNICIPAL FUND, INC.
NQI
In keeping with the Fund's objective of providing attractive tax-free income,
shareholders enjoyed
12 months of stable dividends.
12 MONTH DIVIDEND HISTORY
<CAPTION>
Date Monthly Dividends Supplemental Dividends Capital Gains
<S> <C> <C> <C>
11/94 $0.0845
12/94 $0.0845
1/95 $0.0845
2/95 $0.0845
3/95 $0.0845
4/95 $0.0845
5/95 $0.0845
6/95 $0.0845
7/95 $0.0845
8/95 $0.0845
9/95 $0.0845
10/95 $0.0845
<CAPTION>
FUND HIGHLIGHTS 10/31/95
<S> <C>
Yield 6.76%
Taxable-equivalent yield 10.56%
Annual total return on NAV 16.43%
Taxable-equivalent total return 20.49%
Federal tax rate 36.00%
Share price $15.00
NAV $15.79
The price, net asset value and dividend history used in this chart constitute
past performance and do not necessarily predict the future price, net asset
value or dividends of the Fund or of any other Nuveen Fund.
</TABLE>
<PAGE>
<TABLE>
NUVEEN INSURED MUNICIPAL OPPORTUNITY FUND, INC.
NIO
In keeping with the Fund's objective of providing attractive tax-free income,
shareholders enjoyed 12 months of stable dividends.
12 MONTH DIVIDEND HISTORY
<CAPTION>
Date Monthly Dividends Supplemental Dividends Capital Gains
<S> <C> <C> <C>
11/94 $0.0820
12/94 $0.0820
1/95 $0.0820
2/95 $0.0820
3/95 $0.0820
4/95 $0.0820
5/95 $0.0820
6/95 $0.0820
7/95 $0.0820
8/95 $0.0820
9/95 $0.0820
10/95 $0.0820
<CAPTION>
FUND HIGHLIGHTS 10/31/95
<S> <C>
Yield 6.62%
Taxable-equivalent yield 10.34%
Annual total return on NAV 18.74%
Taxable-equivalent total return 22.81%
Federal tax rate 36.00%
Share price $14.875
NAV $15.60
The price, net asset value and dividend history used in this chart constitute
past performance and do not necessarily predict the future price, net asset
value or dividends of the Fund or of any other Nuveen Fund.
</TABLE>
<PAGE>
<TABLE>
NUVEEN PREMIER INSURED MUNICIPAL INCOME FUND, INC.
NIF
In keeping with the Fund's objective of providing attractive tax-free income,
shareholders enjoyed 12 months of stable dividends.
12 MONTH DIVIDEND HISTORY
<CAPTION>
Date Monthly Dividends Supplemental Dividends Capital Gains
<S> <C> <C> <C>
11/94 $0.0780
12/94 $0.0780
1/95 $0.0780
2/95 $0.0780
3/95 $0.0780
4/95 $0.0780
5/95 $0.0780
6/95 $0.0780
7/95 $0.0780
8/95 $0.0780
9/95 $0.0780
10/95 $0.0780
<CAPTION>
FUND HIGHLIGHTS 10/31/95
<S> <C>
Yield 6.46%
Taxable-equivalent yield 10.09%
Annual total return on NAV 17.73%
Taxable-equivalent total return 21.59%
Federal tax rate 36.00%
Share price $14.50
NAV $15.53
The price, net asset value and dividend history used in this chart constitute
past performance and do not necessarily predict the future price, net asset
value or dividends of the Fund or of any other Nuveen Fund.
</TABLE>
<PAGE>
<TABLE>
NUVEEN INSURED PREMIUM INCOME MUNICIPAL FUND, INC.
NPE
While the dividend income remained attractive compared with other funds, the
dividend was reduced during the 12 months to more closely reflect the earnings
of the bonds in the portfolio.
12 MONTH DIVIDEND HISTORY
<CAPTION>
Date Monthly Dividends Supplemental Dividends Capital Gains
<S> <C> <C> <C>
11/94 $0.0730
12/94 $0.0730
1/95 $0.0730
2/95 $0.0700
3/95 $0.0700
4/95 $0.0700
5/95 $0.0700
6/95 $0.0700
7/95 $0.0700
8/95 $0.0670
9/95 $0.0670
10/95 $0.0670
<CAPTION>
FUND HIGHLIGHTS 10/31/95
<S> <C>
Yield 6.31%
Taxable-equivalent yield 9.86%
Annual total return on NAV 22.56%
Taxable-equivalent total return 26.44%
Federal tax rate 36.00%
Share price $12.75
NAV $14.47
The price, net asset value and dividend history used in this chart constitute
past performance and do not necessarily predict the future price, net asset
value or dividends of the Fund or of any other Nuveen Fund.
</TABLE>
<PAGE>
<TABLE>
NUVEEN INSURED PREMIUM INCOME MUNICIPAL FUND 2
NPX
While the dividend income remained attractive compared with other funds, the
dividend was reduced during the 12 months to more closely reflect the earnings
of the bonds in the portfolio.
12 MONTH DIVIDEND HISTORY
<CAPTION>
Date Monthly Dividends Supplemental Dividends Capital Gains
<S> <C> <C> <C>
11/94 $0.0645
12/94 $0.0645
1/95 $0.0645
2/95 $0.0615
3/95 $0.0615
4/95 $0.0615
5/95 $0.0615
6/95 $0.0615
7/95 $0.0615
8/95 $0.0615
9/95 $0.0615
10/95 $0.0615
<CAPTION>
FUND HIGHLIGHTS 10/31/95
<S> <C>
Yield 6.49%
Taxable-equivalent yield 10.14%
Annual total return on NAV 26.20%
Taxable-equivalent total return 30.14%
Federal tax rate 36.00%
Share price $11.375
NAV $13.03
The price, net asset value and dividend history used in this chart constitute
past performance and do not necessarily predict the future price, net asset
value or dividends of the Fund or of any other Nuveen Fund.
</TABLE>
<PAGE>
Commonly used terms
Yield
An exchange-traded fund's annualized monthly dividend on a given date (in the
case of this report, October 31, 1995) divided by its closing price per share
on that date.
Taxable equivalent yield
The return an investor subject to a given federal income tax rate would need
to obtain from a fully taxable investment to equal the fund's stated
annualized yield on share price. In this report, the tax rate is assumed to be
36.0% for shareholders, based on incomes of $117,950-$256,500 for investors
filing singly, $143,600-$256,500 for those filing jointly.
Net Asset Value (NAV)
The market value of all securities and other assets held by an exchange-traded
fund, minus any liabilities. The NAV per share is the fund's net assets, less
the value of its preferred shares, divided by the total number of common
shares outstanding.
Total return on NAV
The percentage change in a fund's NAV per common share for a given period,
assuming reinvestment of all dividends and capital gains distributions, if
any.
Taxable equivalent total return
The total return an investor subject to a given state and federal income tax
rate would need to obtain from a fully taxable investment to equal the Fund's
stated total return on NAV.
Leverage
A technique used to enhance the income produced for common shareholders by a
long-term municipal bond fund through the issuance of short-term preferred
shares. The proceeds from the sale of the preferred shares can be used to
purchase additional long-term bonds, thus increasing the portfolio's income
stream. Changes in net asset value per share, both up and down, are also
magnified by leverage.
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 12-month period ended October 31, 1995. Any future
repur-chases will be reported to shareholders in the next annual or semiannual
report.
<PAGE>
<TABLE>
SHAREHOLDER MEETING REPORT
On July 26, 1995, Nuveen Exchange-Traded Funds held an Annual Meeting of
Shareholders. At the meeting, shareholders voted to elect directors of the
Funds and to ratify selection of the auditors for the Funds. The directors
elected at the meeting include: Lawrence H. Brown, Richard J. Franke, Anne E.
Impellizzeri, and Peter R. Sawers.
<CAPTION>
NQI NIO NIF NPE NPX
<S> <C> <C> <C> <C> <C>
Approval of the DIRECTORS
was reached as follows:
Lawrence H. Brown
For 31,977,580 71,612,983 16,154,548 13,086,452 18,596,799
Abstain 431,207 720,019 194,153 197,351 382,063
---------- ---------- ---------- ---------- ----------
Total 32,408,787 72,333,002 16,348,701 13,283,803 18,978,862
========== ========== ========== ========== ==========
Richard J. Franke
For 31,999,600 71,614,473 16,155,832 13,089,002 18,601,776
Abstain 409,187 718,529 192,869 194,801 377,086
---------- ---------- ---------- ---------- ----------
Total 32,408,787 72,333,002 16,348,701 13,283,803 18,978,862
========== ========== ========== ========== ==========
Anne E. Impellizzeri
For 31,972,719 71,595,161 16,153,392 13,079,888 18,599,723
Abstain 436,068 737,841 195,309 203,915 379,139
---------- ---------- ---------- ---------- ----------
Total 32,408,787 72,333,002 16,348,701 13,283,803 18,978,862
========== ========== ========== ========== ==========
Peter R. Sawers
For 31,995,042 71,600,331 16,154,094 13,079,772 18,598,692
Abstain 413,745 732,671 194,607 204,031 380,170
---------- ---------- ---------- ---------- ----------
Total 32,408,787 72,333,002 16,348,701 13,283,803 18,978,862
========== ========== ========== ========== ==========
Ratification of auditors
was reached as follows:
For 31,880,367 71,095,637 16,081,109 13,048,229 18,620,024
Against 106,126 343,169 72,737 46,549 103,865
Abstain 422,294 894,196 194,855 189,025 254,973
---------- ---------- ---------- ---------- ----------
Total 32,408,787 72,333,002 16,348,701 13,283,803 18,978,862
========== ========== ========== ========== ==========
</TABLE>
<PAGE>
<TABLE>
PORTFOLIO OF INVESTMENTS
NUVEEN INSURED QUALITY MUNICIPAL FUND, INC. (NQI)
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
ALABAMA - 1.8%
$ 6,000,000 Birmingham Special Care Facilities Financing Authority
(Baptist Health Systems, Inc.), 5.875%, 11/15/15 5/05 at 102 Aaa $ 6,044,820
8,500,000 Birmingham Special Care Facilities Financing Authority
(Medical Center East), 7.250%, 7/01/15 7/96 at 102 Aaa 8,838,215
ALASKA - 1.7%
725,000 Alaska Housing Finance Corporation (GNMA/FNMA),
8.500%, 12/01/11 12/95 at 103 Aaa 748,860
8,595,000 Alaska Housing Finance Corporation, Insured Mortgage
Program, 7.800%, 12/01/30 12/00 at 102 Aa 9,090,846
5,000,000 Anchorage Electric System, Senior Lien, 7.125%, 6/01/06 6/99 at 102 Aaa 5,521,050
ARIZONA - 6.6%
5,000,000 Phoenix Civic Improvement Corporation, Wastewater
System, 6.125%, 7/01/23 (Pre-refunded to 7/01/03) 7/03 at 102 AAA 5,558,150
10,000,000 Pima County Industrial Development Authority
(Carondelet Health Services), 6.750%, 7/01/16 7/01 at 102 Aaa 10,877,800
4,760,000 Pima County Industrial Development Authority, Single
Family Mortgage, Alternative Minimum Tax,
8.200%, 9/01/21 3/99 at 103 Aaa 5,095,913
6,250,000 Scottsdale Industrial Development Authority (Scottsdale
Memorial Hospital), 7.050%, 9/01/18 9/98 at 101 Aaa 6,738,813
10,000,000 Tucson Local Business Development Finance Corporation,
6.250%, 7/01/08 7/02 at 102 Aaa 10,702,600
15,250,000 Tucson Water System, 7.100%, 7/01/18 (Pre-refunded
to 7/01/01) 7/01 at 102 Aaa 17,507,458
ARKANSAS - 2.4%
10,250,000 Arkansas Development Finance Authority, Single Family
Mortgage, Alternative Minimum Tax, 6.700%, 7/01/27 7/05 at 102 AAA 10,635,503
Pope County Solid Waste Disposal (Arkansas Power and
Light Company), Alternative Minimum Tax:
6,400,000 8.000%, 1/01/21 1/01 at 102 Baa2 6,933,120
2,250,000 8.000%, 1/01/21 1/01 at 102 Aaa 2,584,755
CALIFORNIA - 4.1%
5,500,000 California Statewide Communities Development
Authority (Salk Institute for Biological Study),
Certificates of Participation, 6.200%, 7/01/24 7/04 at 102 AAA 5,635,245
12,800,000 Los Angeles Community Redevelopment Agency
(Bunker Hill Project), 5.625%, 12/01/23 12/03 at 102 Aaa 12,430,208
10,000,000 Los Angeles County Metropolitan Transportation
Authority Sales Tax, 5.625%, 7/01/18 7/03 at 102 Aaa 9,860,600
6,910,000 Ontario Redevelopment Financing Authority,
5.850%, 8/01/22 8/03 at 102 Aaa 7,031,616
COLORADO - 3.4%
Colorado Health Facilities Authority (PSL Healthcare
System):
5,000,000 7.250%, 2/15/16 2/01 at 102 Aaa 5,599,850
4,500,000 6.250%, 2/15/21 2/01 at 102 Aaa 4,817,700
3,815,000 Adams County, Single Family Mortgage, 8.700%, 6/01/12 6/01 at 103 Aaa 4,249,910
6,980,000 Arapahoe County, Capital Improvement Trust Fund,
6.150%, 8/31/26 8/05 at 103 Aaa 7,246,357
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
COLORADO (CONTINUED)
$ 90,000 Arapahoe County, Single Family Mortgage (GNMA),
Alternative Minimum Tax, 8.200%, 8/01/14 8/98 at 102 AAA $ 96,421
3,540,000 Castle Pines Metropolitan District, General Obligation,
7.625%, 12/01/15 12/00 at 102 Aaa 4,059,955
320,000 El Paso County, Single Family Mortgage, Alternative
Minimum Tax, 7.850%, 9/01/09 9/00 at 102 AAA 342,880
1,955,000 Jefferson County, Single Family Mortgage,
8.875%, 10/01/13 4/01 at 103 Aaa 2,138,614
DISTRICT OF COLUMBIA - 2.1%
15,450,000 District of Columbia General Obligation, 7.500%, 6/01/10
(Pre-refunded to 6/01/00) 6/00 at 102 Aaa 17,698,593
FLORIDA - 2.9%
Florida Housing Finance Agency, Single Family Mortgage,
Alternative Minimum Tax:
1,695,000 6.550%, 7/01/17 7/04 at 102 AAA 1,749,952
12,130,000 6.650%, 7/01/26 7/04 at 102 AAA 12,502,270
5,560,000 Orange County Health Facilities Authority,
5.750%, 11/15/25 11/05 at 102 Aaa 5,516,576
5,100,000 Pinellas County Health Facilities, 5.600%, 7/01/23 7/03 at 102 Aaa 5,011,566
GEORGIA - 0.8%
4,500,000 Georgia Residential Finance Authority, Single Family
Mortgage, Alternative Minimum Tax, 8.300%, 12/01/19 12/98 at 103 Aa 4,824,315
1,500,000 Marietta Development Authority (Life College, Inc.),
7.250%, 12/01/19 (Pre-refunded to 12/01/99) 12/99 at 102 AAA 1,694,070
ILLINOIS - 7.4%
4,900,000 Illinois Development Finance Authority, Pollution
Control (Illinois Power Company), 5.700%, 2/01/24 2/04 at 102 Aaa 4,755,695
9,500,000 Illinois Health Facilities Authority (The University of
Chicago Hospitals), 6.125%, 8/15/21 8/04 at 102 Aaa 9,663,970
8,400,000 Illinois State Toll Highway Authority, 5.750%, 1/01/17 1/03 at 102 Aaa 8,333,220
5,000,000 Central Lake County Joint Action Water Agency,
7.000%, 5/01/20 (Pre-refunded to 5/01/01) 5/01 at 102 Aaa 5,699,750
10,000,000 Chicago General Obligation, 6.125%, 1/01/16 7/05 at 102 Aaa 10,250,500
6,000,000 Chicago O'Hare International Airport, 6.375%, 1/01/12 1/05 at 102 Aaa 6,394,440
Chicago Public Building Commission (Chicago Board
of Education):
6,280,000 7.125%, 1/01/15 1/00 at 102 Aaa 6,919,492
10,325,000 5.750%, 12/01/18 12/03 at 102 Aaa 10,200,997
565,000 Moline, Rock Island and Urbana (GNMA), Alternative
Minimum Tax, 8.050%, 8/01/23 8/00 at 102 Aaa 609,273
INDIANA - 5.5%
3,285,000 Indiana Housing Finance Authority, Residential Mortgage,
Alternative Minimum Tax, 8.375%, 1/01/20 1/99 at 102 1/2 Aa 3,518,498
9,500,000 Indiana Housing Finance Authority, Single Family
Mortgage, Alternative Minimum Tax, 7.800%, 1/01/22 7/00 at 102 Aaa 10,145,050
6,000,000 Jasper County Pollution Control (Northern Indiana Public
Service Company), 7.100%, 7/01/17 7/01 at 102 Aaa 6,656,520
9,500,000 Marion County Convention and Recreational Facilities
Authority, 7.000%, 6/01/21 (Pre-refunded to 6/01/01) 6/01 at 102 Aaa 10,844,250
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
INDIANA (CONTINUED)
$ 4,230,000 Rockport Pollution Control (Indiana Michigan Power
Company), 7.600%, 3/01/16 3/01 at 102 Aaa $ 4,843,562
10,000,000 St. Joseph County Hospital Authority (Memorial Hospital
of South Bend), 7.000%, 8/15/20 8/01 at 102 Aaa 11,029,500
IOWA - 1.3%
5,305,000 Dubuque County (Sisters of Mercy Health Corporation),
7.000%, 8/15/21 8/01 at 102 Aaa 5,837,145
5,070,000 Muscatine Electric System, 7.625%, 1/01/04 1/96 at 102 Aaa 5,199,741
LOUISIANA - 4.2%
3,115,000 Louisiana Housing Finance Agency (GNMA), Single
Family Mortgage, Alternative Minimum Tax,
8.300%, 11/01/20 11/98 at 102 Aaa 3,339,062
10,095,000 Louisiana Stadium and Exposition District,
6.050%, 7/01/24 7/05 at 102 Aaa 10,284,382
4,325,000 Denham Springs-Livingston Housing Mortgage
Authority, Single Family Mortgage (GNMA/FNMA),
Alternative Minimum Tax, 6.875%, 2/01/28 2/05 at 102 AAA 4,501,460
3,830,000 Lafayette Public Trust Financing Authority, Single Family
Mortgage (GNMA/FNMA), Alternative Minimum Tax,
6.800%, 2/01/21 2/05 at 102 AAA 3,994,728
13,420,000 New Orleans General Obligation, 6.200%, 10/01/21 10/05 at 101 Aaa 13,887,284
MAINE - 1.6%
12,745,000 Maine Housing Authority, Mortgage Purchase,
7.400%, 11/15/22 5/01 at 102 Aaa 13,621,729
MASSACHUSETTS - 0.9%
7,100,000 Massachusetts Housing Finance Agency, Single Family
Mortgage, 7.500%, 12/01/13 6/99 at 102 Aaa 7,615,744
MINNESOTA - 2.1%
14,880,000 Minneapolis/St. Paul Housing Finance Board, Single
Family Mortgage, Alternative Minimum Tax,
8.300%, 8/01/21 8/98 at 102 AAA 15,869,371
1,885,000 St. Louis Park, Single Family Residential Mortgage
(GNMA), 7.250%, 4/20/23 4/01 at 102 Aaa 2,009,806
MISSISSIPPI - 1.8%
7,635,000 Mississippi Housing Finance Corporation, Single Family
Mortgage (GNMA), Alternative Minimum Tax,
8.250%, 10/15/18 10/99 at 102 Aaa 8,176,780
Harrison County Wastewater Management District:
2,545,000 8.500%, 2/01/13 No Opt. Call Aaa 3,345,810
2,715,000 7.750%, 2/01/14 No Opt. Call Aaa 3,374,772
NEVADA - 2.0%
3,270,000 Clarke County Industrial Development Authority
(Nevada Power Company Project), Alternative Minimum
Tax, 7.800%, 6/01/20 6/00 at 102 Aaa 3,670,673
13,185,000 Washoe County (Washoe Medical Center),
6.000%, 6/01/19 6/04 at 102 Aaa 13,312,763
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
NEW HAMPSHIRE - 0.7%
$ 5,990,000 New Hampshire Higher Educational and Health Facilities
Authority (Mary Hitchcock Memorial Hospital),
5.250%, 8/15/21 8/03 at 102 Aaa $ 5,562,793
NEW JERSEY - 0.5%
3,750,000 New Jersey Health Care Facilities Financing Authority
(Monmouth Medical Center), 6.250%, 7/01/24 7/04 at 102 Aaa 3,902,138
NEW MEXICO - 2.6%
3,850,000 New Mexico Mortgage Finance Authority, Multi-Family
Housing, 7.625%, 1/01/24 1/01 at 102 AAA 4,150,377
5,000,000 Albuquerque Airport, Alternative Minimum Tax,
6.600%, 7/01/16 7/00 at 105 Aaa 5,473,100
6,000,000 Farmington Pollution Control (Southern California
Edison Company), 7.200%, 4/01/21 4/01 at 102 Aa3 6,582,000
5,750,000 Santa Fe, 6.300%, 6/01/24 6/04 at 100 Aaa 5,999,090
NEW YORK - 16.7%
7,000,000 New York State Energy Research and Development
Authority, 6.100%, 8/15/20 7/05 at 102 A1 7,074,970
12,860,000 New York State Medical Care Facilities Finance Agency,
Hospital and Nursing Home, Insured Mortgage
(Kingsbrook Jewish Medical Center), 7.600%, 2/15/29 2/99 at 102 Aa 14,158,088
20,250,000 New York State Medical Care Facilities Finance Agency
(St. Luke's-Roosevelt Hospital Center), 7.450%, 2/15/29
(Pre-refunded to 2/15/00) 2/00 at 102 Aaa 23,068,193
5,000,000 New York State Medical Care Facilities Finance Agency
(Isabella Geriatric Center/Arden Hill), 5.900%, 8/15/33 8/03 at 102 Aaa 5,023,450
12,000,000 New York State Medical Care Facilities Finance Agency,
New York Hospital (FHA-Insured Mortgage),
6.900%, 8/15/34 2/05 at 102 Aaa 13,100,040
5,000,000 New York State Mortgage Agency, Homeowner Mortgage,
Alternative Minimum Tax, 7.950%, 10/01/21 2/01 at 102 Aa 5,366,100
New York City General Obligation:
2,000,000 8.000%, 3/15/11 3/00 at 101 1/2 Aaa 2,272,660
6,000,000 7.250%, 3/15/19 3/00 at 101 1/2 Aaa 6,632,460
17,700,000 New York City Housing Development Corporation,
Multi-Unit Mortgage, 7.250%, 6/01/19 6/01 at 102 Aaa 18,989,799
New York City Municipal Water Financing Authority:
20,000,000 5.500%, 6/15/23 6/05 at 101 A 18,901,600
10,000,000 6.000%, 6/15/25 6/05 at 101 A 10,020,700
15,000,000 New York City Transit Authority, Transit Facilities
(Livingston Plaza Project), 7.500%, 1/01/20
(Pre-refunded to 1/01/00) 1/00 at 102 Aaa 17,156,250
NORTH DAKOTA - 1.1%
9,000,000 Mercer County Pollution Control (Basin Electric Power
Coop), 6.050%, 1/01/19 6/05 at 102 Aaa 9,163,710
OKLAHOMA - 1.6%
2,360,000 Oklahoma Housing Finance Agency, Single Family
Mortgage, 7.200%, 3/01/11 3/01 at 102 Aaa 2,534,121
9,900,000 Pottawatomie County Development Authority (North
Deer Creek Reservoir Project), 7.375%, 7/01/26
(Pre-refunded to 7/01/00) 7/00 at 102 Aaa 11,309,166
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
PENNSYLVANIA - 5.4%
$ 8,685,000 Pennsylvania Higher Education Assistance Agency,
Student Loan, 6.800%, 12/01/00 No Opt. Call Aaa $ 9,431,302
7,000,000 Berks County Municipal Authority (Reading Hospital
and Medical Center), 6.100%, 10/01/23 10/04 at 102 Aaa 7,113,890
7,250,000 Lehigh County Industrial Development Authority,
6.150%, 8/01/29 8/05 at 102 Aaa 7,466,340
13,960,000 Philadelphia Water and Sewer System, 7.000%, 8/01/21
(Pre-refunded to 8/01/01) 8/01 at 102 Aaa 15,979,314
5,000,000 Sayre Health Care Facilities Authority (Guthrie
Healthcare System), 7.100%, 3/01/17 3/01 at 102 Aaa 5,546,450
RHODE ISLAND - 3.0%
12,500,000 Rhode Island Depositors Economic Protection Corporation,
Special Obligation, 7.500%, 8/01/14 (Pre-refunded
to 8/01/01) 8/01 at 102 Aaa 14,622,250
5,050,000 Rhode Island Port Authority and Economic Development
Corporation, Airport System, Alternative Minimum
Tax, 6.625%, 7/01/24 7/04 at 102 Aaa 5,326,033
5,000,000 Providence Public Building Authority, 7.250%, 12/15/10 12/00 at 102 Aaa 5,654,150
SOUTH CAROLINA - 0.4%
3,700,000 South Carolina Public Service Authority, 7.750%, 7/01/15 1/96 at 102 Aaa 3,795,423
TENNESSEE - 1.5%
7,680,000 Tennessee Housing Development Agency, Homeownership
Program, Alternative Minimum Tax, 8.125%, 7/01/21 7/98 at 103 A1 7,920,922
5,170,000 Sullivan County Health, Educational and Housing
Facilities Board (Holston Valley Health Care, Inc.),
5.750%, 2/15/13 2/03 at 102 Aaa 5,197,194
TEXAS - 9.0%
Texas Veterans' General Obligation:
9,100,000 8.300%, 12/01/16 (Pre-refunded to 12/01/99) 12/99 at 100 AAA 10,473,281
5,900,000 8.300%, 12/01/16 12/95 at 102 Aa 6,050,332
8,000,000 Abilene Health Facilities Development Corporation
(Hendrick Medical Center), 6.150%, 9/01/25 9/05 at 102 Aaa 8,212,400
16,115,000 Austin Combined Utility System, 5.875%, 5/15/21 5/01 at 100 Aaa 16,129,504
8,300,000 Bexar County Health Facilities Development Corporation
(Incarnate Word Health Services), 6.100%, 11/15/23 (WI) 11/05 at 102 Aaa 8,430,641
4,695,000 Harris County Health Facilities Development Corporation
(Texas Medical Center), 7.375%, 5/15/20 5/00 at 102 Aaa 5,255,347
Harris County Hospital District:
3,000,000 7.500%, 2/15/03 No Opt. Call Aaa 3,465,000
5,000,000 7.400%, 2/15/10 No Opt. Call Aaa 5,961,450
4,100,000 Houston Airport System, Senior Lien, Alternative
Minimum Tax, 8.200%, 7/01/17 7/98 at 102 1/2 Aaa 4,560,675
7,325,000 Matagorda County Navigation District No. 1 (Houston
Lighting and Power Company), Alternative Minimum
Tax, 7.875%, 11/01/16 11/96 at 102 Aaa 7,714,250
UTAH - 0.8%
6,000,000 Salt Lake City (IHC Hospitals), 8.000%, 5/15/07 5/98 at 102 AA 6,609,540
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
VIRGINIA - 0.3%
$ 2,205,000 Chesapeake Hospital Authority (Chesapeake General
Hospital), 7.600%, 7/01/00 No Opt. Call Aaa $ 2,419,171
WISCONSIN - 0.9%
6,855,000 Wisconsin Health and Educational Facilities Authority
(Waukesha Memorial Hospital), 7.250%, 8/15/19 8/00 at 102 Aaa 7,809,010
$772,930,000 Total Investments - (cost $763,680,912) - 97.1% 824,875,242
============
TEMPORARY INVESTMENTS IN SHORT-TERM
MUNICIPAL SECURITIES - 2.4%
$ 500,000 Birmingham Medical Clinic Board (University of
Alabama Health Services Foundation), Variable Rate
Demand Bonds, 4.100%, 12/01/26t A-1+ 500,000
500,000 California Health Facilities Financing Authority
(St. Joseph Health System), Series 1991B, Variable Rate
Demand Bonds, 3.800%, 7/01/09t VMIG-1 500,000
1,600,000 California Health Facilities Financing Authority
(St. Francis Memorial Hospital), Series 1993B, Variable
Rate Demand Bonds, 3.850%, 11/01/19t P-1 1,600,000
1,000,000 Chicago O'Hare International Airport (American Airlines),
Variable Rate Demand Bonds, 4.000%, 12/01/17t P-1 1,000,000
1,000,000 Jackson County Pollution Control Refunding (Chevron
USA Inc., Series 1993), Variable Rate Demand Bonds,
3.900%, 6/01/23t P-1 1,000,000
5,000,000 New York City Municipal Finance Authority, Water and
Sewer System, Series A, Variable Rate Demand Bonds,
4.000%, 6/15/25t VMIG-1 5,000,000
3,300,000 North Carolina Medical Care Commission, Hospital
Pooled Financing (Duke University Hospital), Variable
Rate Demand Bonds, 3.950%, 10/01/20t VMIG-1 3,300,000
1,300,000 Santa Ana Health Facilities Authority (Town & Country),
Variable Rate Demand Bonds, 3.700%, 10/01/20t A-1 1,300,000
6,200,000 University of Florida Stadium, Capital Improvement,
Variable Rate Demand Bonds, 4.000%, 2/01/20t VMIG-1 6,200,000
$ 20,400,000 Total Temporary Investments - 2.4% 20,400,000
============
Other Assets Less Liabilities - 0.5% 4,307,768
Net Assets - 100% $849,583,010
============
<PAGE>
<CAPTION>
NUMBER MARKET MARKET
STANDARD & POOR'S MOODY'S OF ISSUES VALUE PERCENT
<S> <C> <C> <C> <C> <C>
SUMMARY OF AAA Aaa 96 $717,824,211 87%
RATINGS** AA+, AA, AA- Aa1, Aa, Aa2, Aa3 8 56,199,719 7
PORTFOLIO OF A+ A1 2 14,995,892 2
INVESTMENTS A, A- A, A2, A3 2 28,922,300 3
(EXCLUDING BBB+, BBB, BBB- Baa1, Baa, Baa2, Baa3 1 6,933,120 1
TEMPORARY
INVESTMENTS):
TOTAL 109 $824,875,242 100%
<FN>
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 to ensure the timely payment of principal and interest.
* Optional Call Provisions (not covered by the report of independent
auditors): 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 (not covered by the report of independent auditors): Using the
higher of Standard & Poor's or Moody's rating.
(WI) Security purchased on a when-issued basis (note 1).
t The 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)
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
ALABAMA - 1.9%
$ 2,970,000 Alabama Housing Finance Authority, Single Family
Mortgage (GNMA), Alternative Minimum Tax,
7.900%, 10/01/22 10/00 at 102 AAA $ 3,193,522
3,850,000 Alabama Housing Finance Authority (GNMA),
6.500%, 7/20/30 7/05 at 103 Aaa 3,939,936
11,000,000 Birmingham Special Care Facilities Financing Authority
(Baptist Health Systems, Inc.), 5.875%, 11/15/20 5/05 at 102 Aaa 11,036,190
3,745,000 Demopolis General Obligation, 6.900%, 6/01/16
(Pre-refunded to 6/01/01) 6/01 at 102 Aaa 4,256,604
8,000,000 Houston County Health Care Authority (Southeast
Alabama Medical Center), 7.250%, 10/01/19
(Pre-refunded to 10/01/99) 10/99 at 102 Aaa 9,002,160
4,250,000 Shelby County General Obligation, 5.875%, 2/01/17 2/05 at 102 Aaa 4,273,885
ALASKA - 0.9%
4,000,000 Alaska Energy Authority (Bradley Lake Hydroelectric
Project), 7.250%, 7/01/21 7/00 at 102 Aaa 4,470,040
230,000 Alaska Housing Finance Corporation (GNMA and
FNMA), 8.500%, 12/01/11 12/95 at 103 Aaa 237,569
Alaska Housing Finance Corporation, Insured Mortgage
Program:
4,250,000 7.750%, 12/01/14 12/00 at 102 Aa 4,547,458
7,535,000 7.800%, 12/01/30 12/00 at 102 Aa 7,969,694
ARIZONA - 0.9%
15,000,000 Pima County Industrial Development Authority (Tucson
Electric), 7.250%, 7/15/10 1/02 at 103 Aaa 16,798,050
ARKANSAS - 0.9%
16,090,000 Arkansas Development Finance Authority, Single Family
Mortgage (GNMA), Alternative Minimum Tax,
7.400%, 9/01/23 9/01 at 102 AAA 17,221,932
CALIFORNIA - 8.0%
California Health Facilities Financing Authority
(Catholic Healthcare West):
9,000,000 6.500%, 7/01/16 (Pre-refunded to 7/01/01) 7/01 at 102 Aaa 10,098,090
14,000,000 6.650%, 7/01/21 (Pre-refunded to 7/01/01) 7/01 at 102 Aaa 15,812,580
1,880,000 California Housing Finance Agency, Home Mortgage,
Alternative Minimum Tax, 7.450%, 8/01/11 8/01 at 102 Aa 1,974,301
6,135,000 California Housing Finance Agency, 6.250%, 8/01/25 8/04 at 102 Aaa 6,249,663
3,100,000 Campbell Union School District, General Obligation,
6.250%, 8/01/19 8/04 at 102 Aaa 3,226,449
8,200,000 Castaic Lake Water Agency, Certificates of Participation,
6.300%, 8/01/20 8/04 at 102 Aaa 8,573,756
5,000,000 East Bay Municipal Utility District, 5.000%, 6/01/21 6/03 at 102 Aaa 4,547,150
5,500,000 Fallbrook Union High School District, General
Obligation, 6.250%, 9/01/19 9/04 at 102 Aaa 5,712,190
6,530,000 LaQuinta Financing Authority (City Hall Project),
6.650%, 10/01/18 10/00 at 102 Aaa 6,953,666
16,765,000 Los Angeles Department of Water and Power, Electric
Plant, 5.375%, 9/01/23 9/03 at 102 Aaa 15,974,027
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
CALIFORNIA (CONTINUED)
$ 11,200,000 Los Angeles Wastewater System, 4.700%, 11/01/19 11/03 at 102 Aaa $ 9,646,896
10,660,000 Los Angeles County Metropolitan Transportation
Authority, Sales Tax, 5.625%, 7/01/18 7/03 at 102 Aaa 10,511,400
9,000,000 Orange County Recovery, 5.750%, 6/01/15 6/05 at 102 Aaa 8,921,250
4,745,000 Palm Desert Financing Authority, 5.850%, 4/01/25 4/05 at 102 Aaa 4,746,661
9,500,000 Sacramento Municipal Utility District, 5.250%, 11/15/20 11/03 at 102 Aaa 8,915,370
6,500,000 Salinas (GNMA) (Villa Sierra), 6.600%, 7/20/30 7/04 at 102 AAA 6,710,860
11,000,000 Santa Ana Financing Authority, 6.250%, 7/01/24 No Opt. Call Aaa 11,971,960
5,500,000 Santa Clara Financing Authority, 6.750%, 11/15/20 11/04 at 102 Aaa 5,996,100
COLORADO - 0.8%
14,150,000 Denver Board of Water Commissioners, Certificates of
Participation, 6.625%, 11/15/11 11/01 at 101 Aaa 15,290,773
CONNECTICUT - 0.2%
2,500,000 Connecticut Health and Educational Facilities Authority
(Choate Rosemary Hall), 7.000%, 7/01/25 7/04 at 101 Aaa 2,786,700
DISTRICT OF COLUMBIA - 2.5%
19,355,000 District of Columbia, General Obligation,
7.500%, 6/01/09 (Pre-refunded to 6/01/99) 6/99 at 102 Aaa 21,778,052
3,000,000 District of Columbia (National Rehabilitation Hospital),
7.100%, 11/01/11 11/99 at 102 Aaa 3,331,110
6,000,000 District of Columbia (Children's Hospital),
6.250%, 7/15/19 7/02 at 102 Aaa 6,093,780
District of Columbia Housing Finance Agency, Single
Family Mortgage, Alternative Minimum Tax:
4,950,000 7.850%, 12/01/22 6/00 at 102 AAA 5,262,395
4,820,000 7.100%, 12/01/24 12/01 at 102 AAA 5,067,218
5,000,000 District of Columbia (American College of
Obstetricians and Gynecologists), 6.500%, 8/15/18 8/01 at 102 Aaa 5,217,900
FLORIDA - 3.0%
16,135,000 Florida Housing Finance Agency, Home Ownership,
8.595%, 11/01/17 No Opt. Call AAA 17,768,669
6,045,000 Florida Housing Finance Agency, Single Family Mortgage
(GNMA), 7.100%, 1/01/17 3/97 at 103 AAA 6,319,080
10,000,000 Altamonte Springs Health Facilities Authority (Adventist
Health System/Sunbelt), 5.375%, 11/15/23 11/03 at 102 Aaa 9,500,600
7,000,000 Broward County Certificates of Participation,
5.500%, 6/01/13 6/04 at 102 Aaa 6,995,730
4,500,000 Dade County Housing Finance Authority, Single Family
Mortgage, 6.950%, 12/15/12 12/01 at 102 Aaa 4,819,275
10,000,000 Escambia County Housing Finance Authority, Single
Family Mortgage, Alternative Minimum Tax,
6.950%, 10/01/27 4/05 at 102 Aaa 10,556,200
GEORGIA - 0.8%
8,315,000 Fulton-DeKalb Hospital Authority, 6.900%, 1/01/15
(Pre-refunded to 1/01/01) 1/01 at 102 Aaa 9,386,138
5,000,000 Gainesville and Hall County Hospital Authority
(Northeast Georgia Healthcare Project),
6.000%, 10/01/20 10/05 at 102 Aaa 5,052,700
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
HAWAII - 0.7%
$ 13,500,000 Hawaii Housing Finance and Development Corporation,
5.900%, 7/01/27 7/04 at 102 Aaa $ 13,441,140
IDAHO - 0.6%
3,010,000 Idaho Housing Agency, Single Family Mortgage,
6.750%, 7/01/22 No Opt. Call Aa 3,408,735
Idaho Housing Agency, Single Family Mortgage,
Alternative Minimum Tax:
2,900,000 6.900%, 7/01/26 No Opt. Call Aa 3,138,786
4,365,000 6.600%, 7/01/27 1/05 at 102 Aaa 4,461,336
ILLINOIS - 10.9%
5,000,000 Illinois Civic Center, 7.000%, 12/15/10 12/00 at 102 Aaa 5,590,500
20,000,000 Illinois Health Facilities Authority (Brokaw-Mennonite
Association-Bromenn Health), 6.250%, 8/15/18 8/02 at 102 Aaa 20,465,600
9,000,000 Illinois Health Facilities Authority, 6.250%, 8/15/15 8/04 at 102 Aaa 9,309,510
15,000,000 Illinois Health Facilities Authority (Northwestern
Memorial Hospital), 6.000%, 8/15/24 8/04 at 102 Aa 14,896,650
3,500,000 Illinois Health Facilities Authority (Alexian Brothers
Medical Center), 7.125%, 1/01/21 1/01 at 102 Aaa 3,842,650
2,500,000 Illinois Health Facilities Authority (Memorial Medical
Center System), 7.100%, 10/01/21 10/01 at 102 Aaa 2,732,500
4,115,000 Illinois Housing Development Authority, Residential
Mortgage, Alternative Minimum Tax, 7.400%, 2/01/20 8/99 at 102 Aa 4,265,815
Illinois State Department of Central Management
Services (Illinois Student Assistance Commission):
2,965,000 6.875%, 7/01/07 7/02 at 102 Aaa 3,284,508
6,085,000 6.950%, 7/01/13 7/02 at 102 Aaa 6,650,662
2,900,000 Alton (Christian Health), 7.200%, 2/15/21
(Pre-refunded to 2/15/01) 2/01 at 102 Aaa 3,320,819
6,515,000 Berwyn (MacNeal Memorial Hospital), 7.000%, 6/01/15 6/01 at 102 Aaa 7,146,173
4,055,000 Central Lake County Joint Action Water Agency, General
Obligation, 6.000%, 2/01/19 2/03 at 102 Aa 4,081,722
10,000,000 Chicago General Obligation (Central Public Library
Project), 6.850%, 1/01/17 (Pre-refunded to 7/01/02) 7/02 at 101 1/2 Aaa 11,432,600
9,425,000 Chicago General Obligation, 5.500%, 1/01/24 1/04 at 102 Aaa 9,116,520
5,750,000 Chicago Motor Fuel Tax, 6.500%, 1/01/16 (Pre-refunded
to 1/01/01) 1/01 at 100 Aaa 6,293,835
Cook County General Obligation:
18,430,000 6.750%, 11/01/18 (Pre-refunded to 11/01/01) 11/01 at 102 Aaa 20,944,774
26,475,000 6.250%, 11/01/21 11/01 at 102 Aaa 27,203,327
6,370,000 Decatur (Decatur Memorial Hospital), 7.750%, 10/01/21 10/01 at 102 Aaa 7,262,564
Eastern Illinois University, Auxiliary Facilities System:
12,355,000 0.000%, 10/01/09 10/04 at 74 3/32 Aaa 5,141,533
16,470,000 0.000%, 4/01/16 10/04 at 47 3/32 Aaa 4,148,299
4,560,000 Macon County (Millikin University), 6.250%, 10/01/16 10/05 at 100 Aaa 4,725,026
7,000,000 Northern Cook County Solid Waste Agency,
6.250%, 5/01/15 5/02 at 101 Aaa 7,201,950
Regional Transportation Authority:
5,000,000 6.250%, 6/01/24 6/04 at 102 Aaa 5,161,850
5,000,000 6.750%, 6/01/25 6/04 at 102 Aaa 5,433,500
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
INDIANA - 4.0%
$ 2,600,000 Indiana Health Facilities Financing Authority
(Community Hospitals of Indiana), 7.000%, 7/01/21 7/01 at 102 Aaa $ 2,863,770
825,000 Indiana Housing Finance Authority, Alternative
Minimum Tax, 7.800%, 1/01/22 7/00 at 102 Aaa 878,336
2,215,000 Indiana Housing Finance Authority, Single Family
Mortgage, Alternative Minimum Tax, 7.800%, 1/01/22 7/00 at 102 Aaa 2,351,776
7,000,000 Fort Wayne Hospital Authority (Parkview Memorial
Hospital), 6.400%, 11/15/22 11/02 at 102 A1 7,110,040
12,250,000 Lawrenceburg Pollution Control (Indiana Michigan Power
Company), 7.000%, 4/01/15 4/02 at 102 Aaa 13,633,270
12,950,000 Marion County Convention and Recreational Facilities
Authority, 7.000%, 6/01/21 (Pre-refunded to 6/01/01) 6/01 at 102 Aaa 14,782,425
9,545,000 New Prairie School Building Corporation, 7.200%, 7/15/21 7/04 at 102 Aaa 10,755,879
5,000,000 Penn High School Building Corporation, 6.125%, 1/15/16 7/05 at 101 Aaa 5,151,200
14,000,000 St. Joseph County Hospital Authority (Holy Cross
Health System), 7.000%, 12/01/12 12/01 at 102 Aaa 15,445,920
IOWA - 1.4%
5,000,000 Davenport (Mercy Hospital), 6.250%, 7/01/22 7/02 at 102 Aaa 5,163,100
11,400,000 Davenport (St. Luke's Hospital), 7.400%, 7/01/20 7/00 at 102 Aaa 12,789,888
7,000,000 Polk County, Insured Health Facilities (Mercy Health
Center of Central Iowa), 6.750%, 11/01/15 11/01 at 101 Aaa 7,520,380
KANSAS - 0.2%
3,035,000 Sedgwick County and Shawnee County (GNMA),
7.300%, 12/01/12 6/01 at 103 Aaa 3,277,557
KENTUCKY - 1.2%
10,000,000 Danville Multi-City Lease (Louisville and Jefferson
County Metropolitan Sewer), 6.800%, 3/01/19
(Pre-refunded to 3/01/02) 3/02 at 102 Aaa 11,387,500
53,000,000 Jefferson County Capital Projects Corporation,
0.000%, 8/15/19 (Pre-refunded to 2/15/01) 2/01 at 24 11/16 Aaa 10,260,800
LOUISIANA - 2.3%
15,650,000 Louisiana Public Facilities Authority (Southern Baptist
Hospital), 6.800%, 5/15/12 (Pre-refunded to 5/15/02) 5/02 at 102 Aaa 17,874,335
5,340,000 New Orleans Public Improvement, 7.000%, 9/01/19
(Pre-refunded to 9/01/02) 9/02 at 100 Aaa 6,107,305
11,180,000 Orleans Parish School Board, 6.625%, 2/01/02 12/95 at 100 Aaa 11,205,490
3,000,000 St. Charles Parish Pollution Control (Louisiana Power
and Light Company), Alternative Minimum Tax,
7.500%, 6/01/21 6/01 at 102 Aaa 3,376,290
3,500,000 Tangipahoa Parish Hospital, Service District No. 1,
6.250%, 2/01/24 2/04 at 102 Aaa 3,596,880
MAINE - 1.1%
Maine Health and Higher Educational Facilities Authority:
10,500,000 6.375%, 7/01/21 7/01 at 102 Aaa 10,767,225
9,240,000 5.500%, 7/01/23 7/04 at 102 Aaa 8,877,977
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
MASSACHUSETTS - 5.5%
$ 2,000,000 Massachusetts College Building Authority,
7.250%, 5/01/16 (Pre-refunded to 5/01/96) 5/96 at 102 Aaa $ 2,073,920
5,000,000 Massachusetts General Obligation, 6.000%, 7/01/12 7/01 at 100 A 5,055,650
3,800,000 Massachusetts Health and Educational Facilities Authority
(Salem Hospital), 7.250%, 7/01/09
(Pre-refunded to 7/01/97) 7/97 at 100 Aaa 3,974,078
6,000,000 Massachusetts Health and Educational Facilities Authority
(Brigham and Women's Hospital),
6.750%, 7/01/24 7/01 at 102 Aaa 6,459,240
5,050,000 Massachusetts Health and Educational Facilities Authority
(Fallon Health Care), 6.750%, 6/01/20 6/01 at 102 Aaa 5,433,093
10,500,000 Massachusetts Health and Educational Facilities Authority
(New England Medical Center), 6.625%, 7/01/25 7/02 at 102 Aaa 11,256,105
5,850,000 Massachusetts Health and Educational Facilities Authority
(South Shore Hospital), 6.500%, 7/01/22 7/02 at 102 Aaa 6,221,475
8,400,000 Massachusetts Health and Educational Facilities Authority
(Berkshire Health System), 6.000%, 10/01/13 10/05 at 102 Aaa 8,589,756
Massachusetts Housing Finance Agency, Single Family
Mortgage, Alternative Minimum Tax:
9,240,000 7.750%, 12/01/20 6/99 at 102 Aa 9,834,502
14,365,000 7.150%, 12/01/24 6/01 at 102 Aa 15,179,639
21,785,000 Massachusetts Housing Finance Authority, Insured Rental
Housing, Alternative Minimum Tax, 6.650%, 7/01/19 7/04 at 102 Aaa 22,573,835
5,000,000 Massachusetts Housing Finance Authority,
6.100%, 12/01/16 12/05 at 102 Aaa 5,033,700
MICHIGAN - 5.0%
8,860,000 Michigan Housing Development Authority, Rental
Housing, Alternative Minimum Tax, 7.150%, 4/01/10 1/02 at 102 A+ 9,391,954
11,000,000 Michigan State Hospital Finance Authority (Sisters of
Mercy health Corporation), 5.250%, 8/15/21 8/03 at 102 Aaa 10,215,480
15,000,000 Michigan Strategic Fund (The Detroit Edison Company),
6.875%, 12/01/21 12/01 at 102 Aaa 16,419,900
12,250,000 Detroit Economic Development Corporation, Resource
Recovery, Alternative Minimum Tax, 6.875%, 5/01/09 5/01 at 102 Aaa 13,353,113
20,300,000 Detroit Sewage Disposal System, 6.625%, 7/01/21 7/01 at 102 Aaa 21,782,915
8,000,000 Gaylord Community Schools General Obligation,
0.000%, 5/01/21 (Pre-refunded to 5/01/07) 5/07 at 37 3/4 Aaa 1,645,440
8,500,000 Jackson County Hospital Finance Authority (W. A. Foote
Memorial Hospital), 5.250%, 6/01/23 6/03 at 102 Aaa 7,876,525
27,000,000 Okemos Public Schools, General Obligation, Unlimited
Tax, 0.000%, 5/01/21 (Pre-refunded to 5/01/06) 5/06 at 34 17/32 Aaa 5,418,090
5,590,000 Western Township Utilities Authority, Sewage Disposal
System, 6.500%, 1/01/19 1/02 at 100 Aaa 5,841,382
MINNESOTA - 0.7%
Minnesota Housing Finance Agency, Single Family,
Alternative Minimum Tax:
5,000,000 6.850%, 1/01/24 7/02 at 102 Aa 5,187,700
7,420,000 6.700%, 7/01/26 1/04 at 102 AA+ 7,650,762
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
MISSOURI - 0.6%
$ 5,945,000 Missouri Housing Development Commission, Single
Family Mortgage (GNMA), 6.900%, 7/01/18 1/02 at 102 AAA $ 6,293,674
4,450,000 Missouri Housing Development Commission, Single
Family Mortgage, Alternative Minimum Tax,
7.900%, 2/01/21 2/99 at 102 AAA 4,732,442
MONTANA - 1.5%
26,000,000 Forsyth Pollution Control (Puget Sound Power and Light
Company), 6.800%, 3/01/22 3/02 at 102 Aaa 28,102,360
NEBRASKA - 0.2%
3,625,000 Nebraska Investment Finance Authority, Single Family
Mortgage, Alternative Minimum Tax, 8.125%, 8/15/38 8/98 at 102 Aaa 3,847,466
NEVADA - 3.3%
5,725,000 Nevada Housing Division, 6.700%, 10/01/17 4/04 at 102 Aa 5,977,587
4,415,000 Nevada Housing Division, Alternative Minimum Tax,
6.950%, 10/01/26 4/04 at 102 Aa 4,607,450
29,775,000 Clarke County Industrial Development Authority
(Nevada Power Company Project), Alternative Minimum
Tax, 7.800%, 6/01/20 6/00 at 102 Aaa 33,423,331
11,000,000 Clark County Passenger Facility (Las Vegas-McCarran
International Airport), 6.000%, 7/01/22 7/02 at 102 Aaa 11,076,450
5,250,000 Henderson (Catholic Healthcare West), 7.000%, 7/01/20
(Pre-refunded to 7/01/99) 7/99 at 102 Aaa 5,830,703
NEW HAMPSHIRE - 0.3%
4,950,000 New Hampshire Higher Educational and Health Facilities
Authority (Lakes Region Hospital Association),
5.750%, 1/01/11 1/03 at 102 Aaa 5,005,787
NEW JERSEY - 0.5%
3,935,000 New Jersey Turnpike Authority, 10.375%, 1/01/03 No Opt. Call AAA 4,798,654
5,000,000 Mercer County Improvement Authority, Solid Waste,
Alternative Minimum Tax, 6.700%, 4/01/13 4/02 at 102 Aaa 5,256,950
NEW YORK - 3.7%
New York State Energy Research and Development
Authority (Consolidated Edison of New York),
Alternative Minimum Tax:
18,220,000 7.250%, 11/01/24 11/98 at 101 Aaa 19,736,268
7,000,000 7.500%, 7/01/25 7/99 at 101 Aaa 7,707,770
3,000,000 New York State Mortgage Agency, Homeowner Mortgage,
Alternative Minimum Tax, 7.800%, 10/01/20 10/99 at 102 Aa 3,209,490
8,265,000 New York City General Obligation, 6.250%, 8/01/10
(Pre-refunded to 8/01/02) 8/02 at 101 1/2 Aaa 9,210,516
1,500,000 New York City Municipal Water Finance Authority,
Water and Sewer System, 7.375%, 6/15/14
(Pre-refunded to 6/15/01) 6/01 at 101 1/2 Aaa 1,740,900
Dormitory Authority of the State of New York (City
University):
3,000,000 6.250%, 7/01/19 7/04 at 100 Aaa 3,116,520
6,400,000 6.750%, 7/01/24 7/04 at 102 Aaa 7,041,344
15,600,000 Port Authority of New York and New Jersey, Alternative
Minimum Tax, 6.650%, 1/15/23 1/05 at 101 Aaa 16,643,172
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
NORTH CAROLINA - 2.8%
$ 45,000,000 Charlotte Convention Facility, Certificates of Participation,
6.750%, 12/01/21 (Pre-refunded to 12/01/01) 12/01 at 102 Aaa $ 51,382,800
OHIO - 3.1%
13,750,000 Ohio Air Quality Development Authority (JMG Funding
Limited Partnership Project), Alternative Minimum
Tax, 6.375%, 1/01/29 10/04 at 102 Aaa 14,478,750
Ohio Air Quality Development Authority (JMG Funding
Limited Partnership Project), Alternative Minimum Tax:
10,000,000 6.625%, 3/01/26 3/05 at 102 AAA 10,283,800
8,000,000 6.375%, 4/01/29 10/04 at 102 Aaa 8,424,000
12,550,000 Cleveland Waterworks, 6.500%, 1/01/21 (Pre-refunded
to 1/01/02) 1/02 at 102 Aaa 14,056,753
9,000,000 Lucas County (St. Vincent Medical Center),
6.625%, 8/15/22 (Pre-refunded to 8/15/02) 8/02 at 102 Aaa 10,054,980
OKLAHOMA - 3.1%
1,180,000 Oklahoma Housing Finance Agency, Single Family
Mortgage, 7.150%, 3/01/07 3/01 at 102 Aaa 1,266,069
46,430,000 Oklahoma Housing Finance Agency, Single Family
Mortgage (GNMA), Alternative Minimum Tax:
7.997%, 8/01/18 No Opt. Call AAA 50,588,303
3,360,000 Norman Regional Hospital Authority, 6.900%, 9/01/21 9/01 at 102 Aaa 3,655,613
1,605,000 Tulsa County Home Finance Authority (GNMA),
Alternative Minimum Tax, 7.100%, 6/01/22 12/01 at 102 AAA 1,699,823
OREGON - 0.3%
5,500,000 Oregon State Housing and Community Services
Department, Single Family Mortgage, Alternative
Minimum Tax, 6.450%, 7/01/26 7/05 at 102 Aa 5,594,105
PENNSYLVANIA - 5.7%
8,200,000 Pennsylvania Higher Educational Facilities Authority
(Temple University), 5.750%, 4/01/31 4/01 at 100 Aaa 8,059,534
7,000,000 Commonwealth of Pennsylvania (Harristown Development
Corporation), Certificates of Participation,
6.250%, 5/01/16 11/01 at 102 Aaa 7,265,090
14,700,000 Allegheny County (Greater Pittsburgh International
Airport), Alternative Minimum Tax, 6.625%, 1/01/22 1/02 at 102 Aaa 15,395,751
7,000,000 Beaver County Industrial Development Authority,
Pollution Control (Penn Power-Mansfield Project),
7.150%, 9/01/21 9/01 at 102 Aaa 7,806,750
24,800,000 Butler County Hospital Authority (North Hills Passavant
Hospital), 7.000%, 6/01/22 6/01 at 102 Aaa 27,405,488
Delaware County Industrial Development Authority
(Philadelphia Electric Project):
5,000,000 7.375%, 4/01/21 4/01 at 102 Baa1 5,388,600
5,000,000 7.375%, 4/01/21 4/01 at 102 Aaa 5,650,200
10,000,000 Harrisburg Authority, 6.625%, 6/01/13 6/01 at 101 Aaa 10,996,900
7,120,000 Lehigh County General Purpose Authority (Lehigh Valley
Hospital), 6.250%, 7/01/22 7/04 at 102 Aaa 7,385,861
8,950,000 Montgomery County Industrial Development Authority,
Pollution Control (Philadelphia Electric Company),
6.625%, 6/01/22 6/02 at 102 Aaa 9,520,831
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
RHODE ISLAND - 4.1%
Rhode Island Depositors Economic Protection
Corporation, Special Obligation:
$ 5,140,000 7.100%, 8/01/18 (Pre-refunded to 8/01/01) 8/01 at 102 Aaa $ 5,909,355
20,475,000 5.250%, 8/01/21 8/03 at 100 Aaa 18,887,164
6,000,000 Rhode Island Port Authority and Economic Development
Corporation, Airport System, Alternative Minimum
Tax, 5.250%, 7/01/15 7/03 at 102 Aaa 5,559,000
38,650,000 The Convention Center Authority of Rhode Island,
6.700%, 5/15/20 (Pre-refunded to 5/15/01) 5/01 at 102 Aaa 43,522,992
2,195,000 Providence Housing Development Corporation,
FHA-Insured (Barbara Jordan Apartments),
6.750%, 7/01/25 7/04 at 102 Aaa 2,300,162
SOUTH CAROLINA - 0.9%
South Carolina Jobs-Economic Development Authority
(Oconee Memorial Hospital):
3,000,000 6.150%, 3/01/15 3/05 at 102 AAA 3,069,780
1,775,000 6.150%, 3/01/25 3/05 at 102 AAA 1,811,867
3,275,000 Lexington County Health Service District,
6.750%, 10/01/18 10/01 at 102 Aaa 3,576,235
22,000,000 Piedmont Municipal Power Agency, 0.000%, 1/01/13 No Opt. Call Aaa 8,217,000
SOUTH DAKOTA - 0.7%
4,280,000 South Dakota Health and Educational Facilities Authority
(Rapid City Regional Hospital), 7.000%, 9/01/14 9/99 at 102 Aaa 4,722,338
2,800,000 South Dakota Health and Educational Facilities Authority
(McKennan Hospital), 7.250%, 7/01/15 7/00 at 102 Aaa 3,109,120
5,200,000 Grant County Pollution Control (Northwestern Public
Service Company), 5.900%, 6/01/23 6/03 at 102 Aaa 5,209,100
TENNESSEE - 0.4%
7,500,000 Metropolitan Nashville Airport Authority, Airport
Improvement Revenue, 6.600%, 7/01/15 7/01 at 102 Aaa 8,076,975
TEXAS - 2.6%
9,500,000 Coastal Bend Health Facilities Corporation (Incarnate
Word Health Services), 6.000%, 11/15/22 11/02 at 102 Aaa 9,568,875
2,300,000 East Texas Housing Finance Corporation, Single Family
Mortgage, Alternative Minimum Tax, 7.750%, 6/01/17 6/00 at 103 AAA 2,452,306
Harris County Toll Road, Senior Lien:
9,000,000 0.000%, 8/15/18 (Pre-refunded to 8/15/09) 8/09 at 53 27/32 Aaa 2,325,240
39,000,000 0.000%, 8/15/19 (Pre-refunded to 8/15/09) 8/09 at 50 1/4 Aaa 9,406,020
7,280,000 0.000%, 8/15/20 (Pre-refunded to 8/15/09) 8/09 at 46 29/32 Aaa 1,625,915
5,085,000 0.000%, 8/15/21 (Pre-refunded to 8/15/09) 8/09 at 43 25/32 Aaa 1,068,714
15,000,000 Houston Water and Sewer System, Junior Lien,
6.375%, 12/01/17 12/01 at 102 Aaa 15,711,900
5,000,000 San Antonio Water System, 5.500%, 5/15/18 5/02 at 100 Aaa 4,889,350
UTAH - 1.3%
6,935,000 Utah Housing Finance Agency, Multi-Family Housing,
7.400%, 7/01/24 1/02 at 102 AA 7,413,584
5,600,000 Utah Housing Finance Agency, Alternative Minimum
Tax, 6.750%, 7/01/27 7/04 at 102 Aaa 5,810,560
Intermountain Power Agency:
6,250,000 7.000%, 7/01/15 7/97 at 102 Aaa 6,633,000
4,565,000 6.000%, 7/01/21 7/97 at 100 Aaa 4,577,097
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
VIRGINIA - 0.6%
$ 11,000,000 Loudoun County Industrial Development Authority
(Loudoun Hospital Centre), 5.800%, 6/01/20 6/05 at 102 Aaa $ 10,906,830
WASHINGTON - 3.9%
19,750,000 Washington Health Care Facilities Authority (Group
Health Cooperative of Puget Sound), 7.200%, 12/01/15 12/99 at 102 Aaa 22,035,470
5,000,000 Washington Public Power Supply System, Nuclear
Project No. 1, 6.250%, 7/01/17 7/02 at 102 Aaa 5,139,100
5,000,000 Washington Public Power Supply System, Nuclear
Project No. 3, 5.600%, 7/01/17 7/03 at 102 Aaa 4,904,300
Douglas County Public Utility District No. 1 (Wells
Hydroelectric), Alternative Minimum Tax:
1,485,000 7.800%, 9/01/18 (Pre-refunded to 9/01/00) 9/00 at 102 Aaa 1,729,446
2,515,000 7.800%, 9/01/18 9/00 at 102 A+ 2,805,659
4,500,000 King County Public Hospital District No. 1 (Valley
Medical Center), 7.250%, 9/01/15 9/00 at 102 Aaa 5,003,505
24,675,000 Municipality of Metropolitan Seattle, Limited Sales Tax,
General Obligation, 6.625%, 1/01/17 1/97 at 102 Aa 25,435,484
4,250,000 Snohomish County Public Utility District No. 1,
6.650%, 1/01/16 No Opt. Call Aaa 4,649,075
WEST VIRGINIA - 1.1%
5,050,000 West Virginia University Dormitory System,
6.750%, 5/01/17 11/02 at 100 Aaa 5,415,267
4,100,000 West Virginia Water Development Authority,
7.000%, 11/01/25 11/01 at 102 Aaa 4,546,572
10,000,000 Harrison County Commission Solid Waste Disposal
(West Penn Power Company), Alternative Minimum
Tax, 6.300%, 5/01/23 5/03 at 102 A1 9,974,100
WISCONSIN - 4.1%
3,800,000 Wisconsin Health and Educational Facilities Authority
(Waukesha Memorial Hospital), 7.250%, 8/15/19 8/00 at 102 Aaa 4,328,846
Wisconsin Health and Educational Facilities Authority
(St. Luke's Medical Center):
17,000,000 7.400%, 8/15/19 (Pre-refunded to 8/15/99) 8/99 at 102 Aaa 19,163,420
8,150,000 7.100%, 8/15/19 8/01 at 102 Aaa 9,050,900
10,000,000 Wisconsin Health and Educational Facilities Authority
(Marshfield Clinic), 7.250%, 8/01/15 8/00 at 102 Aaa 11,059,900
17,710,000 Wisconsin Health and Educational Facilities Authority
(Novus Health Group), 6.750%, 12/15/20 12/01 at 102 Aaa 19,085,890
Wisconsin Housing and Economic Development Authority:
8,270,000 6.850%, 11/01/12 11/02 at 102 Aaa 8,788,942
3,500,000 6.450%, 3/01/17 3/04 at 102 Aa 3,589,810
$1,855,050,000 Total Investments - (cost $1,684,370,350) - 98.3% 1,811,249,210
==============
TEMPORARY INVESTMENTS IN SHORT-TERM
MUNICIPAL SECURITIES - 0.1%
$ 1,600,000 California Health Facilities Financing Authority (St.
==============
Francis Memorial Hospital), Series 1993B, Variable
Rate Bonds, 3.850%, 11/01/19t P-1 1,600,000
Other Assets Less Liabilities - 1.6% 28,930,598
Net Assets - 100% $1,841,779,808
==============
<PAGE>
<CAPTION>
NUMBER MARKET MARKET
STANDARD & POOR'S MOODY'S OF ISSUES VALUE PERCENT
<S> <C> <C> <C> <C> <C>
SUMMARY OF AAA Aaa 179 $1,633,559,933 89%
RATINGS** AA+, AA, AA- Aa1, Aa, Aa2, Aa3 19 137,963,274 7
PORTFOLIO OF A+ A1 4 29,281,753 2
INVESTMENTS A, A- A, A2, A3 1 5,055,650 1
(EXCLUDING BBB+, BBB, BBB- Baa1, Baa, Baa2, Baa3 1 5,388,600 1
TEMPORARY
INVESTMENTS):
TOTAL 204 $1,811,249,210 100%
<FN>
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 to ensure the timely payment of principal and interest.
* Optional Call Provisions (not covered by the report of independent
auditors): 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 (not covered by the report of independent auditors): Using the
higher of Standard & Poor's or Moody's rating.
t The 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)
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
ALABAMA - 1.3%
Montgomery Financing Authority, Special Care Facilities
(Baptist Medical Center):
$ 3,000,000 6.700%, 12/01/10 12/02 at 102 Aaa $ 3,270,780
2,250,000 5.750%, 1/01/22 1/02 at 100 Aaa 2,215,395
CALIFORNIA - 17.6%
Kern County Housing Authority (GNMA), Alternative
Minimum Tax:
1,090,000 7.150%, 12/30/24 No Opt. Call AAA 1,228,703
595,000 7.450%, 6/30/25 No Opt. Call AAA 673,129
6,045,000 LaVerne-Grand Terrace Housing Finance Agency, Single
Family Mortgage, 10.250%, 7/01/17 No Opt. Call Aaa 9,338,195
5,840,000 Lancaster Redevelopment Agency, Tax Allocation,
6.100%, 8/01/19 8/01 at 102 Aaa 5,944,536
5,040,000 Northern California Power Agency, 10.000%, 7/01/04 No Opt. Call Aaa 6,834,643
5,000,000 Ontario Redevelopment Authority, 7.400%, 8/01/25 No Opt. Call Aaa 6,231,600
2,340,000 Pomona Public Financing Authority (Water Treatment
Project), 6.100%, 7/01/17 7/02 at 102 Aaa 2,379,897
8,880,000 Pomona Single Family Mortgage (GNMA and FNMA),
7.500%, 8/01/23 No Opt. Call Aaa 10,586,292
10,305,000 San Bernardino Single Family Mortgage (GNMA),
7.500%, 5/01/23 No Opt. Call Aaa 12,518,617
14,755,000 San Bernardino County Single Family Mortgage,
Alternative Minimum Tax, 8.300%, 9/01/14 No Opt. Call Aaa 19,046,787
2,000,000 Santa Barbara Water System, Certificates of Participation,
6.700%, 4/01/27 4/02 at 102 Aaa 2,146,840
COLORADO - 0.3%
1,225,000 Summit County School District RE-1, General Obligation,
6.700%, 12/01/14 12/04 at 100 Aaa 1,348,701
DISTRICT OF COLUMBIA - 0.8%
3,000,000 District of Columbia (National Rehabilitation Hospital),
7.125%, 11/01/19 11/99 at 102 Aaa 3,333,810
FLORIDA - 2.7%
7,000,000 Polk County Industrial Development Authority (Winter
Haven Hospital), 6.250%, 9/01/15 9/02 at 103 Aaa 7,256,760
4,200,000 Sarasota County School Board Financing Corporation,
7.250%, 7/01/10 (Pre-refunded to 7/01/00) 7/00 at 101 Aaa 4,754,862
GEORGIA - 4.5%
3,160,000 Georgia Municipal Electric Authority, 7.800%, 1/01/20 1/98 at 102 Aaa 3,439,376
Burke County Development Authority, Pollution Control
(Oglethorpe Power Corporation):
3,555,000 7.800%, 1/01/08 1/03 at 103 Aaa 4,255,193
10,000,000 8.000%, 1/01/15 1/03 at 103 Aaa 11,974,400
ILLINOIS - 11.8%
6,635,000 Illinois Health Facilities Authority (Memorial Medical
Center of Springfield), 6.500%, 10/01/16 10/00 at 102 Aaa 6,961,508
2,210,000 City of Carbondale (Southern Illinois Hospital),
6.875%, 3/01/15 3/97 at 102 Aaa 2,322,644
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
ILLINOIS (CONTINUED)
$ 10,000,000 Chicago General Obligation (Central Public Library
Project), 6.850%, 1/01/17 (Pre-refunded to 7/01/02) 7/02 at 101 1/2 Aaa $ 11,432,600
8,200,000 Chicago Board of Education, General Obligation, Lease
Certificates, 6.250%, 1/01/15 No Opt. Call Aaa 8,795,648
2,600,000 Cook County General Obligation, 6.250%, 11/01/21 11/01 at 102 Aaa 2,671,526
10,150,000 Onterie Center Housing Finance Corporation,
FHA-Insured, 7.050%, 7/01/27 7/02 at 102 Aaa 10,772,094
3,225,000 Regional Transportation Authority, 9.000%, 6/01/09 No Opt. Call Aaa 4,334,013
4,000,000 St. Clair County Public Building Commission, Alternative
Minimum Tax, 6.350%, 12/01/09 12/02 at 102 Aaa 4,256,480
INDIANA - 4.1%
2,500,000 Indiana Bond Bank, 9.000%, 8/01/09 (Pre-refunded
to 2/01/99) 2/99 at 101 1/2 Aaa 2,940,350
5,000,000 Indiana Health Facilities Financing Authority
(Community Hospitals Project), 6.400%, 5/01/12 5/02 at 102 Aaa 5,228,100
2,000,000 Fremont Middle School Building Corporation,
6.750%, 3/15/13 (Pre-refunded to 3/15/02) 3/02 at 101 Aaa 2,258,280
7,000,000 Southwest Allen Multi-School Building Corporation,
6.375%, 1/15/09 1/02 at 101 Aaa 7,361,760
KENTUCKY - 1.5%
6,500,000 Daviess County (Owensboro-Daviess County Hospital),
6.250%, 8/01/22 8/02 at 102 Aaa 6,740,630
LOUISIANA - 3.2%
Louisiana Public Facilities Authority (Our Lady of
Lourdes Regional Medical Center):
5,000,000 6.375%, 2/01/12 2/02 at 102 Aaa 5,363,950
4,000,000 6.450%, 2/01/22 2/02 at 102 Aaa 4,167,680
3,750,000 Louisiana Public Facilities Authority (Southern Baptist
Hospital), 6.800%, 5/15/12 (Pre-refunded to 5/15/02) 5/02 at 102 Aaa 4,282,988
MARYLAND - 0.8%
4,000,000 Maryland Health and Higher Educational Facilities
Authority (Francis Scott Key Medical Center),
5.000%, 7/01/23 7/03 at 102 Aaa 3,584,120
MASSACHUSETTS - 2.0%
5,360,000 Massachusetts Health and Educational Facilities
Authority (New England Medical Center),
6.625%, 7/01/25 7/02 at 102 Aaa 5,745,974
3,000,000 Framingham Housing Authority, GNMA (Beaver Terrace
Apartments), 6.650%, 2/20/32 8/01 at 102 AAA 3,076,560
MISSISSIPPI - 1.1%
4,355,000 Mississippi Home Corporation, 9.250%, 3/01/12 9/00 at 103 Aaa 4,768,594
MISSOURI - 2.4%
7,495,000 Jefferson County Industrial Development Authority
(Richardson Road Apartments Project),
11.000%, 12/15/15 (Pre-refunded to 8/15/07) 8/07 at 100 AAA 10,636,155
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
MONTANA - 3.2%
$ 13,000,000 Forsyth Pollution Control (Puget Sound Power and Light
Company), 6.800%, 3/01/22 3/02 at 102 Aaa $ 14,051,180
NEBRASKA - 0.5%
2,235,000 Nebraska Investment Finance Authority, Single Family
Mortgage, Alternative Minimum Tax, 8.125%, 8/15/38 8/98 at 102 Aaa 2,372,162
NEVADA - 2.5%
6,000,000 Humboldt County Pollution Control (Sierra Pacific Power
Company), 6.550%, 10/01/13 10/02 at 102 Aaa 6,394,740
4,500,000 Washoe County Gas and Water Facilities (Sierra Pacific
Power Company), 6.300%, 12/01/14 7/02 at 102 Aaa 4,719,330
NEW YORK - 5.8%
7,645,000 Metropolitan Transportation Authority, Transit Facilities,
9.100%, 7/01/05 No Opt. Call Aaa 10,120,910
New York City General Obligation:
1,425,000 7.875%, 8/01/00 No Opt. Call Aaa 1,628,804
6,665,000 6.625%, 8/01/14 (Pre-refunded to 8/01/02) 8/02 at 101 1/2 Aaa 7,571,773
335,000 6.625%, 8/01/14 8/02 at 101 1/2 Aaa 358,383
4,950,000 6.625%, 8/01/15 (Pre-refunded to 8/01/02) 8/02 at 101 1/2 Aaa 5,623,448
50,000 6.625%, 8/01/15 8/02 at 101 1/2 Aaa 53,607
NORTH CAROLINA - 0.9%
4,000,000 North Carolina Medical Care Commission (Alamance
Health Services, Inc.), 5.500%, 8/15/24 8/03 at 102 Aaa 3,840,720
OKLAHOMA - 4.1%
9,505,000 Oklahoma Housing Finance Agency (GNMA), Single
Family Mortgage, Alternative Minimum Tax,
7.997%, 8/01/18 No Opt. Call AAA 10,372,046
4,285,000 Tulsa Airports Improvement Trust (Tulsa International
Airport), Alternative Minimum Tax, 7.700%, 6/01/09 6/97 at 102 1/2 Aaa 4,590,863
3,000,000 Tulsa Industrial Authority, GNMA (Country Club of
Woodland), 6.250%, 11/01/27 11/05 at 103 Aaa 3,018,570
PENNSYLVANIA - 8.0%
13,480,000 Allegheny County (Greater Pittsburgh International
Airport), Alternative Minimum Tax, 8.250%, 1/01/16 1/98 at 102 Aaa 14,736,875
19,140,000 Montgomery County Industrial Development Authority,
Pollution Control (Philadelphia Electric Company),
6.625%, 6/01/22 6/02 at 102 Aaa 20,360,749
RHODE ISLAND - 4.9%
12,750,000 Rhode Island Depositors Economic Protection
Corporation, Special Obligation, 6.625%, 8/01/19
(Pre-refunded to 8/01/02) 8/02 at 102 Aaa 14,475,840
4,000,000 Rhode Island General Obligation, 7.000%, 6/15/05 No Opt. Call Aaa 4,629,720
1,900,000 Rhode Island Convention Center Authority,
6.700%, 5/15/20 (Pre-refunded to 5/15/01) 5/01 at 102 Aaa 2,139,552
SOUTH CAROLINA - 2.4%
9,450,000 South Carolina Public Service Authority (Santee Cooper),
6.500%, 7/01/24 (Pre-refunded to 7/01/02) 7/02 at 102 Aaa 10,650,434
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
SOUTH DAKOTA - 0.5%
$ 2,100,000 South Dakota Health and Educational Facilities
Authority (Vocational Education Program),
5.700%, 8/01/23 8/03 at 102 Aaa $ 2,061,045
TEXAS - 7.1%
5,000,000 Brazos River Authority, Pollution Control (Texas
Utilities Electric Company), Alternative Minimum
Tax, 6.050%, 4/01/25 4/03 at 102 Aaa 5,037,150
2,570,000 Corpus Christi Housing Finance Corporation, Single
Family Mortgage, 7.700%, 7/01/11 7/01 at 103 Aaa 2,796,134
2,165,000 El Paso Property Finance Authority, Single Family
Mortgage (GNMA), Alternative Minimum Tax,
8.700%, 12/01/18 6/02 at 103 Aaa 2,333,718
Harris County Toll Road Senior Lien:
8,400,000 6.625%, 8/15/17 (Pre-refunded to 8/15/97) 8/97 at 102 Aaa 8,937,432
1,600,000 6.625%, 8/15/17 8/97 at 102 Aaa 1,674,080
5,210,000 6.500%, 8/15/17 (Pre-refunded to 8/15/02) 8/02 at 102 Aaa 5,880,527
940,000 6.500%, 8/15/17 8/02 at 102 Aaa 1,003,703
3,000,000 Rio Grande Health Facilities Development Corporation
(Valley Baptist Medical Center), 6.375%, 8/01/22 8/02 at 102 Aaa 3,115,680
UTAH - 0.4%
1,490,000 Utah Board of Regents (Weber State University),
6.250%, 4/01/10 4/02 at 100 Aaa 1,550,061
WASHINGTON - 2.3%
1,085,000 North Franklin School District No. J51-162, General
Obligation, 6.700%, 12/01/10 12/02 at 100 Aaa 1,160,797
Puyallup School District No. 3, General Obligation:
2,000,000 6.650%, 12/01/07 12/02 at 100 Aaa 2,182,880
4,750,000 6.700%, 12/01/09 12/02 at 100 Aaa 5,128,052
1,325,000 Richland Electric System, 6.700%, 11/01/11 11/02 at 100 Aaa 1,427,900
WEST VIRGINIA - 1.5%
6,000,000 Mason County Pollution Control (Appalachian Power
Company), 6.850%, 6/01/22 6/02 at 102 Aaa 6,538,080
$382,210,000 Total Investments - (cost $397,343,910) - 98.2% 429,017,115
============
Temporary Investments in Short-Term
Municipal Securities - 0.3%
$ 1,300,000 Birmingham Medical Clinic Board (University of
============
Alabama Health Services Foundation), Variable Rate
Demand Bonds, 4.100%, 12/01/26t A-1+ 1,300,000
Other Assets Less Liabilities - 1.5% 6,602,671
Net Assets - 100% $436,919,786
============
<PAGE>
<CAPTION>
NUMBER MARKET MARKET
STANDARD & POOR'S MOODY'S OF ISSUES VALUE PERCENT
<S> <C> <C> <C> <C> <C>
SUMMARY OF AAA Aaa 76 $429,017,115 100%
RATINGS**
PORTFOLIO OF
INVESTMENTS
(EXCLUDING
TEMPORARY
INVESTMENTS):
TOTAL 76 $429,017,115 100%
<FN>
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 to ensure the timely payment of principal and interest.
* Optional Call Provisions (not covered by the report of independent
auditors): 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 (not covered by the report of independent auditors): Using the
higher of Standard & Poor's or Moody's rating.
t The 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 PREMIUM INCOME MUNICIPAL FUND, INC. (NPE)
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
ALASKA - 1.6%
Anchorage General Obligation:
$ 2,020,000 5.900%, 2/01/06 No Opt. Call Aaa $ 2,166,753
3,000,000 6.250%, 6/01/23 6/99 at 100 Aaa 3,061,860
CALIFORNIA - 7.9%
6,590,000 California Housing Finance Agency, Multi-Unit Rental,
Alternative Minimum Tax, 6.625%, 2/01/24 2/03 at 102 A1 6,756,134
3,000,000 M-S-R Public Power Agency, San Juan Project,
6.000%, 7/01/20 7/03 at 102 Aaa 3,044,760
7,000,000 Palmdale Community Redevelopment Agency,
8.000%, 4/01/16 No Opt. Call Aaa 8,828,330
San Leandro Housing Finance Corporation (Ashland
Village Apartments):
2,005,000 6.550%, 1/01/12 1/02 at 102 Aaa 2,094,884
5,100,000 6.650%, 1/01/25 1/02 at 102 Aaa 5,311,038
DISTRICT OF COLUMBIA - 4.4%
5,000,000 District of Columbia (Children's Hospital),
6.250%, 7/15/19 7/02 at 102 Aaa 5,078,150
3,910,000 District of Columbia Housing Finance Agency, Single
Family Mortgage, Alternative Minimum Tax,
6.350%, 12/01/24 6/03 at 102 AAA 3,951,642
5,250,000 District of Columbia (The Catholic University of America),
6.450%, 10/01/23 10/03 at 102 AAA 5,450,130
ILLINOIS - 17.2%
8,000,000 Illinois Development Finance Authority, Pollution Control
(Illinois Power Company), 8.300%, 4/01/17 4/98 at 102 Aaa 8,858,320
3,635,000 Illinois Development Finance Authority (Indian Prairie
Community Unit School District No. 204),
7.750%, 12/30/03 No Opt. Call Aaa 4,345,315
Illinois Health Facilities Authority (Lutheran General
Health System):
4,355,000 6.125%, 4/01/12 4/03 at 102 Aaa 4,486,565
5,000,000 6.250%, 4/01/18 4/03 at 102 Aaa 5,122,950
1,770,000 Illinois Health Facilities Authority (Elmhurst Memorial
Hospital), 6.625%, 1/01/22 1/02 at 102 Aaa 1,867,863
Illinois State Toll Highway Authority:
4,000,000 6.200%, 1/01/16 1/03 at 102 Aaa 4,105,000
4,250,000 5.750%, 1/01/17 1/03 at 102 Aaa 4,216,213
2,750,000 Chicago Midway Airport, Alternative Minimum Tax,
6.250%, 1/01/14 1/04 at 102 Aaa 2,844,848
9,000,000 Chicago O'Hare International Airport, International
Terminal, 6.750%, 1/01/18 1/02 at 102 Aaa 9,492,120
3,000,000 Cook County Community College, District No. 508,
8.750%, 1/01/06 No Opt. Call Aaa 3,869,670
6,500,000 Metropolitan Pier & Exposition Authority (McCormick
Place Expansion Project), 6.500%, 6/15/22 6/03 at 102 Aaa 6,942,585
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
INDIANA - 1.0%
$ 2,220,000 Indiana Municipal Power Agency, Power Supply System,
6.125%, 1/01/19 1/03 at 102 Aaa $ 2,269,728
1,000,000 Fort Wayne South Side School Building Corporation,
6.125%, 1/15/12 1/04 at 102 Aaa 1,037,540
KANSAS - 0.4%
Kansas Development Finance Authority:
515,000 5.700%, 6/01/11 6/03 at 102 Aaa 522,375
750,000 5.875%, 6/01/21 6/03 at 102 Aaa 759,878
LOUISIANA - 0.8%
2,500,000 Louisiana Public Facilities Authority (Louisiana
Department of Health and Hospitals Medical Center),
6.250%, 10/15/10 10/02 at 100 AAA 2,590,300
MICHIGAN - 5.7%
8,300,000 Michigan Hospital Finance Authority (Henry Ford
Health System), 5.750%, 9/01/17 9/02 at 102 Aaa 8,182,555
10,000,000 Monroe County Pollution Control (Detroit Edison),
Alternative Minimum Tax, 6.550%, 9/01/24 9/03 at 103 Aaa 10,535,900
MONTANA - 0.8%
2,500,000 Forsyth Pollution Control (Puget Sound Power and
Light Company), 5.875%, 4/01/20 4/03 at 102 Aaa 2,501,650
NEVADA - 5.3%
2,905,000 Clark County General Obligation (Limited Tax),
10.000%, 6/01/01 No Opt. Call Aaa 3,663,786
5,000,000 Clark County (Nevada Power Company), Alternative
Minimum Tax, 6.700%, 6/01/22 6/02 at 102 Aaa 5,257,450
7,295,000 Clark County School District, General Obligation,
7.250%, 6/15/03 No Opt. Call Aaa 8,461,981
NEW JERSEY - 16.4%
15,495,000 New Jersey Economic Development Authority
(Elizabethtown Gas Company), Alternative Minimum
Tax, 6.750%, 10/01/21 10/96 at 102 Aaa 16,056,539
5,000,000 New Jersey Economic Development Authority
(Hackensack Water Company), 7.000%, 1/01/19 1/97 at 102 Aaa 5,245,900
New Jersey Economic Development Authority:
750,000 7.000%, 7/01/03 No Opt. Call Aaa 860,685
4,000,000 7.000%, 7/01/04 No Opt. Call Aaa 4,631,440
5,000,000 New Jersey Housing and Mortgage Finance Agency,
5.350%, 10/01/15 10/03 at 102 Aaa 4,747,350
15,000,000 New Jersey Transportation Trust Fund Authority,
6.500%, 6/15/05 No Opt. Call Aaa 16,902,600
New Jersey Turnpike Authority:
3,000,000 6.500%, 1/01/08 No Opt. Call Aaa 3,355,290
2,000,000 6.500%, 1/01/16 No Opt. Call Aaa 2,253,520
NEW YORK - 5.1%
Metropolitan Transportation Authority, Transit Facilities:
5,000,000 6.300%, 7/01/06 No Opt. Call Aaa 5,582,350
4,985,000 8.000%, 7/01/07 No Opt. Call Aaa 6,271,579
4,000,000 New York City General Obligation, 8.000%, 8/01/05 No Opt. Call Aaa 4,939,360
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
OHIO - 2.7%
$ 5,500,000 Ohio Air Quality Development Authority, Pollution
Control (Cleveland Electric Illuminating Company),
8.000%, 12/01/13 6/02 at 103 Aaa $ 6,515,905
2,250,000 Hamilton County Sewer System, 5.450%, 12/01/09 No Opt. Call Aaa 2,293,178
OKLAHOMA - 2.7%
8,425,000 McGee Creek Authority, Water System, 6.000%, 1/01/23 No Opt. Call Aaa 8,996,131
PENNSYLVANIA - 10.6%
2,000,000 Pennsylvania Industrial Development Authority,
7.000%, 1/01/06 No Opt. Call Aaa 2,309,540
8,275,000 Bethlehem Authority, Water System, 6.250%, 11/15/21
(Pre-refunded to 11/15/01) 11/01 at 100 Aaa 9,065,180
10,140,000 Erie County Prison Authority, 6.250%, 11/01/11
(Pre-refunded to 11/01/01) 11/01 at 100 Aaa 11,103,097
1,000,000 Luzerne County Industrial Development Authority
(Pennsylvania Gas and Water Company Project),
Alternative Minimum Tax, 7.000%, 12/01/17 12/04 at 102 Aaa 1,105,750
7,000,000 Philadelphia School District, General Obligation,
5.300%, 7/01/04 No Opt. Call Aaa 7,217,770
4,000,000 University of Pittsburgh, 6.125%, 6/01/21 6/02 at 102 Aaa 4,098,920
SOUTH CAROLINA - 2.0%
6,500,000 Piedmont Municipal Power Agency, 6.300%, 1/01/22 1/03 at 102 Aaa 6,720,935
TEXAS - 5.2%
9,590,000 Texas Veterans Housing, General Obligation, Alternative
Minimum Tax, 6.800%, 12/01/23 12/03 at 102 Aaa 10,052,622
7,075,000 Houston Housing Finance Corporation, Single Family
Mortgage, 5.950%, 12/01/10 6/03 at 102 Aaa 7,198,600
WASHINGTON - 6.1%
6,130,000 Washington Health Care Facilities Authority (Swedish
Hospital Medical Center of Seattle), 6.300%, 11/15/22 11/02 at 102 Aaa 6,310,528
8,100,000 Washington Health Care Facilities Authority (Virginia
Mason), 6.300%, 2/15/17 2/03 at 102 Aaa 8,307, 926
5,535,000 Washington Public Power Supply System, Nuclear
Project No. 3, 6.000%, 7/01/18 7/99 at 100 Aaa 5,537,158
WISCONSIN - 1.2%
4,000,000 Wisconsin Health and Educational Facilities Authority
(Wheaton Franciscan Services), 5.750%, 8/15/22 8/03 at 102 Aaa 3,927,240
PUERTO RICO - 1.1%
3,270,000 Puerto Rico Public Buildings Authority,
6.250%, 7/01/12 No Opt. Call Aaa 3,589,707
$301,140,000 Total Investments - (cost $310,961,282) - 98.2% 322,875,073
============
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
TEMPORARY INVESTMENTS IN SHORT-TERM
MUNICIPAL SECURITIES - 0.4%
$ 1,300,000 Port Authority of New York and New Jersey, Versatile
============
Structure Obligations, Variable Rate Demand Bonds,
3.600%, 5/01/19t A-1+ $ 1,300,000
Other Assets Less Liabilities - 1.4% 4,668,869
Net Assets - 100% $328,843,942
============
<CAPTION>
NUMBER MARKET MARKET
STANDARD & POOR'S MOODY'S OF ISSUES VALUE PERCENT
<S> <C> <C> <C> <C> <C>
SUMMARY OF AAA Aaa 59 $316,118,939 98%
RATINGS** A+ A1 1 6,756,134 2
PORTFOLIO OF
INVESTMENTS
(EXCLUDING
TEMPORARY
INVESTMENTS):
TOTAL 60 $322,875,073 100%
<FN>
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 to ensure the timely payment of principal and interest.
* Optional Call Provisions (not covered by the report of independent
auditors): 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 (not covered by the report of independent auditors): Using the
higher of Standard & Poor's or Moody's rating.
t The 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 PREMIUM INCOME MUNICIPAL FUND 2 (NPX)
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
ALASKA - 0.9%
$ 2,000,000 Alaska International Airports, Alternative Minimum Tax,
5.500%, 10/01/15 10/03 at 102 Aaa $ 1,965,480
2,000,000 Anchorage General Obligation, 5.600%, 1/01/14 1/04 at 100 Aaa 1,991,940
ARIZONA - 1.5%
3,700,000 Glendale Union High School District No. 205 General
Obligation, 5.700%, 7/01/14 7/05 at 101 Aaa 3,754,834
2,750,000 Phoenix Civic Improvement Corporation, Water System,
5.500%, 7/01/21 7/04 at 102 Aaa 2,725,498
ARKANSAS - 0.3%
1,500,000 Pulaski County, Special School District, Limited Tax,
5.250%, 2/01/19 2/99 at 100 Aaa 1,442,430
CALIFORNIA - 15.2%
10,355,000 California General Obligation, 11.000%, 8/01/03 No Opt. Call Aaa 14,463,553
15,325,000 California Pollution Control Finance Authority (Pacific
Gas and Electric Company), 5.850%, 12/01/23 12/03 at 102 A2 14,772,381
20,000,000 Los Angeles Community, Redevelopment Agency
(Bunker Hill Project), 5.625%, 12/01/18 12/03 at 102 Aaa 19,544,200
3,500,000 Northern California Power Agency Hydroelectric,
5.500%, 7/01/16 7/03 at 102 Aaa 3,438,260
5,000,000 Oakland Pension Financing, 7.600%, 8/01/21 8/98 at 102 Aaa 5,503,200
8,000,000 University of California, 5.000%, 9/01/14 9/03 at 102 Aaa 7,379,520
DISTRICT OF COLUMBIA - 3.3%
District of Columbia General Obligation:
5,000,000 6.500%, 6/01/09 No Opt. Call Aaa 5,537,050
5,000,000 5.500%, 6/01/12 No Opt. Call Aaa 4,739,350
4,030,000 District of Columbia Housing Finance Agency
(Southview Apartments), 6.000%, 1/01/25 7/03 at 102 Aaa 3,969,590
FLORIDA - 5.2%
5,250,000 Florida Department of General Services, Bond Finance
Division, 4.750%, 7/01/12 7/04 at 101 Aaa 4,794,090
5,500,000 Florida Municipal Power Agency, 6.500%, 10/01/20
(Pre-refunded to 10/01/02) 10/02 at 102 Aaa 6,242,280
9,000,000 Dade County, Water and Sewer System, 5.000%, 10/01/13 10/03 at 102 Aaa 8,456,760
3,000,000 Orlando and Orange County Expressway Authority,
5.500%, 7/01/18 7/03 at 102 Aaa 2,948,280
GEORGIA - 0.7%
3,000,000 Georgia Municipal Electric Authority, 6.000%, 1/01/22 1/04 at 102 Aaa 3,034,980
ILLINOIS - 10.7%
4,340,000 Illinois Development Finance Authority (Indian Prairie
Community Unit School District No. 204),
7.750%, 12/30/04 No Opt. Call Aaa 5,235,255
1,950,000 Illinois Health Facilities Authority, 6.550%, 6/01/14 No Opt. Call Aaa 2,130,083
500,000 Illinois Health Facilities Authority (Rush-Presbyterian-
St. Luke's Medical Center), 5.500%, 11/15/25 11/03 at 102 Aaa 473,005
4,000,000 Illinois Housing Development Authority, 6.000%, 7/01/18 1/04 at 102 A1 3,970,240
3,000,000 Illinois Sales Tax, 7.000%, 6/15/20 (Pre-refunded
to 6/15/01) 6/01 at 102 AAA 3,426,690
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
ILLINOIS (CONTINUED)
$ 1,500,000 Chicago General Obligation, 6.125%, 1/01/16 7/05 at 102 Aaa $ 1,537,575
1,100,000 Chicago Midway Airport, Alternative Minimum Tax,
6.100%, 1/01/08 1/04 at 102 Aaa 1,152,525
5,660,000 Chicago O'Hare International Airport, 6.375%, 1/01/15 1/05 at 102 Aaa 5,983,865
4,000,000 Chicago Public Building Commission (Board of
Education), 5.750%, 12/01/18 12/03 at 102 Aaa 3,951,960
2,000,000 Chicago Wastewater Transmission, 5.125%, 1/01/20 1/03 at 100 Aaa 1,836,460
520,000 Cook County General Obligation, 5.500%, 11/15/22 11/02 at 102 Aaa 498,477
5,825,000 Franklin Park General Obligation, 5.500%, 7/01/13 7/04 at 102 Aaa 5,701,568
4,500,000 Northlake General Obligation, 5.600%, 12/01/14 12/05 at 102 Aaa 4,420,620
5,000,000 Peoria, Moline and Freeport Single Family Mortgage,
Alternative Minimum Tax, 7.600%, 4/01/27 10/05 at 105 AAA 5,509,750
INDIANA - 2.2%
9,770,000 Northwest Allen Building Corporation, 5.500%, 6/01/15 6/05 at 102 Aaa 9,434,596
KANSAS - 1.5%
3,460,000 Olathe/Labette County, Single Family Mortgage,
Alternative Minimum Tax, 8.100%, 8/01/23 2/05 at 105 Aaa 3,904,195
2,330,000 Sedgwick County and Shawnee County, Single Family
Mortgage, Alternative Minimum Tax, 8.050%, 5/01/24 11/04 at 105 Aaa 2,618,058
KENTUCKY - 3.5%
Louisville-Jefferson County Regional Airport Authority,
Alternative Minimum Tax:
1,570,000 5.500%, 7/01/13 7/03 at 102 Aaa 1,485,063
13,745,000 5.500%, 7/01/23 7/03 at 102 Aaa 13,447,558
LOUISIANA - 1.8%
4,105,000 Louisiana Housing Finance Agency, Multi-Family
Housing (GNMA), 6.200%, 6/20/28 12/02 at 103 Aaa 4,110,747
3,750,000 Jefferson Parish Hospital Service District No. 1,
5.250%, 1/01/13 1/04 at 102 Aaa 3,576,300
MAINE - 0.5%
1,745,000 Maine Turnpike Authority, 7.500%, 7/01/09 No Opt. Call Aaa 2,113,823
MARYLAND - 2.4%
9,770,000 Maryland Transportation Authority (Baltimore/
Washington International Airport), Alternative
Minimum Tax, 6.400%, 7/01/19 7/04 at 102 Aaa 10,294,063
MICHIGAN - 0.9%
3,250,000 Wayne County (Detroit Metropolitan Airport),
5.250%, 12/01/21 12/03 at 102 Aaa 3,021,298
1,000,000 Wayne County (Detroit Metropolitan Airport),
Alternative Minimum Tax, 5.500%, 12/01/21 12/03 at 102 Aaa 974,950
MISSOURI - 2.7%
2,600,000 Missouri Third State Building, General Obligation,
7.050%, 8/01/05 (Pre-refunded to 8/01/96) 8/96 at 102 Aaa 2,713,828
3,415,000 Missouri Health and Educational Facilities,
6.250%, 2/15/22 2/02 at 102 Aaa 3,520,284
5,000,000 Kansas City Land Clearance Redevelopment Authority,
5.900%, 12/01/18 12/05 at 102 Aaa 5,045,000
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
NEVADA - 5.9%
$ 8,320,000 Clark County, School District, General Obligation,
7.250%, 6/15/04 No Opt. Call Aaa $ 9,728,826
Reno (St. Mary's Regional Medical Center):
3,100,000 5.625%, 5/15/18 5/03 at 102 Aaa 3,037,876
10,000,000 5.625%, 5/15/23 5/03 at 102 Aaa 9,780,600
2,490,000 University of Nevada, Community College System,
5.600%, 7/01/13 7/03 at 101 Aaa 2,490,896
NEW JERSEY - 0.6%
2,500,000 New Jersey Housing and Mortgage Finance Agency,
Multi-Family, 6.000%, 11/01/14 11/05 at 102 Aaa 2,526,900
NEW YORK - 4.2%
New York State Medical Care Facilities Finance Agency,
FHA-Insured (New York Hospital):
3,000,000 6.750%, 8/15/14 2/05 at 102 Aaa 3,306,990
2,500,000 6.800%, 8/15/24 2/05 at 102 Aaa 2,730,350
3,000,000 New York State Medical Care Facilities Finance Agency
(Mental Health Facilities), 6.000%, 8/15/15 2/05 at 102 Aaa 3,080,160
4,090,000 Metropolitan Transportation Authority, Commuter
Facilities, 8.000%, 7/01/07 No Opt. Call Aaa 5,145,588
2,500,000 New York City General Obligation, 5.750%, 8/01/10 8/02 at 101 1/2 Aaa 2,552,275
1,070,000 Niagara Falls General Obligation, 7.500%, 3/01/09 No Opt. Call Aaa 1,294,636
OHIO - 4.8%
8,320,000 Ohio Housing Finance Agency, Single Family Mortgage
(GNMA), Alternative Minimum Tax, 7.650%, 3/01/29 9/99 at 102 AAA 8,707,546
2,000,000 Cleveland Waterworks System, 6.250%, 1/01/15 1/02 at 102 Aaa 2,084,760
3,000,000 Fairfield City School District, General Obligation,
6.000%, 12/01/20 12/05 at 100 Aaa 3,073,920
6,450,000 Hamilton Electric System, 6.000%, 10/15/23 10/02 at 102 Aaa 6,581,774
OKLAHOMA - 1.5%
6,000,000 Norman Regional Hospital Authority, 6.900%, 9/01/21 9/01 at 102 Aaa 6,527,880
PENNSYLVANIA - 5.0%
Philadelphia School District, General Obligation:
2,680,000 6.250%, 9/01/08 (WI) No Opt. Call Aaa 2,942,211
2,000,000 5.500%, 9/01/15 (WI) 9/05 at 102 Aaa 1,972,520
Philadelphia Water and Wastewater System:
3,700,000 5.500%, 6/15/14 6/03 at 102 Aaa 3,568,243
4,000,000 5.500%, 6/15/15 6/03 at 102 Aaa 3,908,240
10,000,000 5.000%, 6/15/16 6/03 at 100 Aaa 9,151,000
TENNESSEE - 0.9%
2,000,000 Knoxville Community Development Corporation,
Multi-Family Mortgage (GNMA), 6.200%, 7/20/28 7/03 at 101 AAA 2,017,200
2,000,000 Madison Suburban Utility Water District,
5.000%, 2/01/19 2/08 at 100 Aaa 1,833,940
TEXAS - 3.7%
4,000,000 Texas Southern University, 5.750%, 8/01/18 8/03 at 101 Aaa 4,007,000
1,915,000 Texas Veterans Housing General Obligation, Alternative
Minimum Tax, 6.800%, 12/01/23 12/03 at 102 Aa 1,975,437
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
TEXAS (CONTINUED)
$ 2,845,000 Austin Combined Utility System, 11.125%, 11/15/09
(Pre-refunded to 11/15/99) 11/99 at 100 Aaa $ 3,555,397
6,370,000 Brazos River Authority, Pollution Control (Texas Utilities
Electric Company), 5.500%, 5/01/22 11/03 at 102 Aaa 6,175,715
UTAH - 1.5%
3,600,000 Utah State Board of Regents, Student Loan, Alternative
Minimum Tax, 5.900%, 11/01/13 11/03 at 102 Aaa 3,594,060
2,720,000 Salt Lake County Water Conservancy District,
5.350%, 10/01/18 10/03 at 100 Aaa 2,563,110
WASHINGTON - 6.7%
Washington Public Power Supply System, Nuclear
Project No. 1:
3,750,000 5.600%, 7/01/15 7/03 at 102 AAA 3,664,500
11,000,000 5.700%, 7/01/17 7/03 at 102 AAA 10,764,820
6,295,000 Washington Public Power Supply System, Nuclear
Project No. 3, 5.600%, 7/01/17 7/03 at 102 Aaa 6,174,514
4,000,000 Snohomish County Public Utility District No. 1, Electric
System, 5.800%, 1/01/24 1/04 at 102 A1 3,888,880
2,500,000 Tacoma Department of Public Utilities, 6.375%, 12/01/15 12/05 at 100 Aaa 2,632,825
1,465,000 Yakima County School District No. 7, General Obligation,
6.250%, 12/01/07 (WI) No Opt. Call Aaa 1,597,054
WEST VIRGINIA - 2.3%
10,000,000 Mason County Pollution Control (Ohio Power Company),
5.450%, 12/01/16 12/03 at 102 Aaa 9,700,900
WISCONSIN - 7.6%
2,000,000 Wisconsin Health and Educational Facilities Authority
(Children's Hospital of Wisconsin), 6.500%, 8/15/10 8/02 at 102 Aaa 2,132,680
3,750,000 Wisconsin Health and Educational Facilities Authority
(Sisters of the Sorrowful Mother Ministry),
5.400%, 8/15/13 8/03 at 102 Aaa 3,608,700
5,000,000 Wisconsin Health and Educational Facilities Authority,
6.125%, 8/15/13 8/05 at 102 Aaa 5,184,450
14,500,000 Wisconsin Housing and Economic Development
Authority, 5.800%, 11/01/13 12/03 at 102 A1 14,388,060
6,000,000 Superior Limited Obligation (Detroit Edison Company),
6.900%, 8/01/21 No Opt. Call Aaa 6,987,840
$409,745,000 Total Investments - (cost $414,797,256) - 98.0% 419,431,785
============
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
TEMPORARY INVESTMENTS IN SHORT-TERM
MUNICIPAL SECURITIES - 0.6%
$ 1,700,000 Gulf Coast Waste Disposal Authority Pollution Control
Revenue Refunding (Amoco Oil Company Project),
Series 1992, Variable Rate Demand Bonds,
3.900%, 10/01/17t VMIG-1 $ 1,700,000
500,000 Missouri Health and Educational Facilities Authority
(Washington University), Variable Rate Demand Bonds,
4.100%, 3/01/17t VMIG-1 500,000
300,000 North Carolina Medical Care Commission Hospital
Pooled Financing (Duke University Hospital), Variable
Rate Demand Bonds, 3.950%, 10/01/20t VMIG-1 300,000
$ 2,500,000 Total Temporary Investments - 0.6% 2,500,000
============
Other Assets Less Liabilities - 1.4% 5,976,574
Net Assets - 100% $427,908,359
============
<CAPTION>
NUMBER MARKET MARKET
STANDARD & POOR'S MOODY'S OF ISSUES VALUE PERCENT
<S> <C> <C> <C> <C> <C>
SUMMARY OF AAA Aaa 83 $380,436,787 91%
RATINGS** AA+, AA, AA- Aa1, Aa, Aa2, Aa3 1 1,975,437 1
PORTFOLIO OF A+ A1 3 22,247,180 5
INVESTMENTS A, A- A, A2, A3 1 14,772,381 3
(EXCLUDING
TEMPORARY
INVESTMENTS):
TOTAL 88 $419,431,785 100%
<FN>
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 to ensure the timely payment of principal and interest.
* Optional Call Provisions (not covered by the report of independent
auditors): 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 (not covered by the report of independent auditors): Using the
higher of Standard & Poor's or Moody's rating.
t The 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.
(WI) Security purchased on a when-issued basis (note 1).
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
STATEMENT OF NET ASSETS
<CAPTION>
NQI NIO NIF NPE
<S> <C> <C> <C> <C>
ASSETS
Investments in municipal securities, at market value (note 1) $824,875,242 $1,811,249,210 $429,017,115 $322,875,073
Temporary investments in short-term municipal securities,
at amortized cost (note 1) 20,400,000 1,600,000 1,300,000 1,300,000
Cash 80,904 91,678 168,750 72,882
Receivables:
Interest 16,146,287 34,896,198 8,084,071 5,893,216
Investments sold 386,549 2,453,528 96,274 --
Prepaid Preferred shares auction fees (note 1) 407,280 23,407 102,309 --
Other assets 30,428 70,040 21,369 23,857
----------- ------------- ----------- ------------
Total assets 862,326,690 1,850,384,061 438,789,888 330,165,028
----------- ------------- ----------- ------------
Liabilities
Payable for investments purchased 8,300,000 -- -- --
Accrued expenses:
Management fees (note 6) 450,422 956,535 236,015 178,350
Other 297,296 526,605 91,032 60,677
Preferred share dividends payable 540,770 595,077 51,424 68,452
Common share dividends payable 3,155,192 6,526,036 1,491,631 1,013,607
----------- ------------- ----------- ------------
Total liabilities 12,743,680 8,604,253 1,870,102 1,321,086
----------- ------------- ----------- ------------
Net assets (note 7) $849,583,010 $1,841,779,808 $436,919,786 $328,843,942
============ ============== ============ ============
Preferred shares, at liquidation value $260,000,000 $ 600,000,000 $140,000,000 $110,000,000
============ ============== ============ ============
Preferred shares outstanding 10,400 24,000 5,600 4,400
============ ============== ============ ============
Common shares outstanding 37,339,555 79,585,806 19,123,476 15,128,458
============ ============== ============ ============
Net asset value per Common share outstanding (net assets less
Preferred shares at liquidation value, divided by Common
shares outstanding) $ 15.79 $ 15.60 $ 15.53 $ 14.47
============ ============== ============ ============
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
STATEMENT OF NET ASSETS
<CAPTION>
NPX
<S> <C>
ASSETS
Investments in municipal securities, at market value (note 1) $419,431,785
Temporary investments in short-term municipal securities,
at amortized cost (note 1) 2,500,000
Cash 60,127
Receivables:
Interest 8,251,307
Investments sold 5,801,615
Prepaid Preferred shares auction fees (note 1) --
Other assets 13,755
-----------
Total assets 436,058,589
-----------
Liabilities
Payable for investments purchased 6,450,920
Accrued expenses:
Management fees (note 6) 230,265
Other 153,070
Preferred share dividends payable 46,488
Common share dividends payable 1,269,487
------------
Total liabilities 8,150,230
------------
Net assets (note 7) $427,908,359
============
Preferred shares, at liquidation value $158,900,000
============
Preferred shares outstanding 6,356
============
Common shares outstanding 20,642,068
============
Net asset value per Common share outstanding (net assets less
Preferred shares at liquidation value, divided by Common
shares outstanding) $ 13.03
============
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
STATEMENT OF OPERATIONS
Year ended October 31, 1995
<CAPTION>
NQI NIO NIF NPE
<S> <C> <C> <C> <C>
Investment Income
Tax-exempt interest income (note 1) $54,080,799 $113,698,117 $26,318,137 $18,828,179
----------- ------------ ----------- -----------
Expenses:
Management fees (note 6) 5,168,735 10,924,595 2,698,736 2,026,982
Preferred shares--auction fees 644,584 1,582,984 379,167 275,000
Preferred shares--dividend disbursing agent fees 40,000 70,050 20,000 30,000
Shareholders' servicing agent fees and expenses 138,477 222,047 57,089 37,963
Custodian's fees and expenses 105,183 178,848 69,819 62,127
Directors'/Trustees' fees and expenses (note 6) 5,967 2,460 2,083 1,586
Professional fees 24,152 23,247 20,935 19,001
Shareholders' reports--printing and mailing expenses 249,674 419,708 87,625 72,305
Stock exchange listing fees 34,020 67,761 23,285 24,529
Portfolio insurance expense 233,969 380,740 -- 12,281
Investor relations expense 41,834 96,332 23,857 15,517
Other expenses 38,085 72,576 35,302 26,603
----------- ------------ ----------- -----------
Total expenses 6,724,680 14,041,348 3,417,898 2,603,894
----------- ------------ ----------- -----------
Net investment income 47,356,119 99,656,769 22,900,239 16,224,285
----------- ------------ ----------- -----------
Realized and Unrealized Gain (Loss)
from Investments
Net realized gain (loss) from investment transactions, net of
taxes, if applicable (notes 1 and 3) 9,599,723 5,949,070 3,892 (1,944,767)
Net change in unrealized appreciation or depreciation
of investments 39,973,498 121,824,356 28,757,014 31,478,880
----------- ------------ ----------- -----------
Net gain from investments 49,573,221 127,773,426 28,760,906 29,534,113
----------- ------------ ----------- -----------
Net increase in net assets from operations $96,929,340 $227,430,195 $51,661,145 $45,758,398
=========== ============ =========== ===========
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
STATEMENT OF OPERATIONS
Year ended October 31, 1995
<CAPTION>
NPX
<S> <C>
Investment Income
Tax-exempt interest income (note 1) $24,078,207
-----------
Expenses:
Management fees (note 6) 2,595,700
Preferred shares--auction fees 397,250
Preferred shares--dividend disbursing agent fees 45,000
Shareholders' servicing agent fees and expenses 45,910
Custodian's fees and expenses 69,765
Directors'/Trustees' fees and expenses (note 6) 2,039
Professional fees 23,404
Shareholders' report--printing and mailing expenses 80,812
Stock exchange listing fees 15,903
Portfolio insurance expense 60,598
Investor relations expense 24,488
Other expenses 44,152
-----------
Total expenses 3,405,021
-----------
Net investment income 20,673,186
-----------
Realized and Unrealized Gain (Loss)
from Investments
Net realized gain (loss) from investment transactions, net of
taxes, if applicable (notes 1 and 3) (12,029,555)
Net change in unrealized appreciation or depreciation
of investments 55,044,396
-----------
Net gain from investments 43,014,841
-----------
Net increase in net assets from operations $63,688,027
============
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<CAPTION>
NQI NIO
Year ended Year ended Year ended Year ended
10/31/95 10/31/94 10/31/95 10/31/94
<S> <C> <C> <C> <C>
Operations
Net investment income $ 47,356,119 $ 47,368,738 $ 99,656,769 $ 98,534,967
Net realized gain (loss) from investment transactions, net of
taxes, if applicable 9,599,723 (2,737,017) 5,949,070 164,199
Net change in unrealized appreciation or depreciation
of investments 39,973,498 (73,182,324) 121,824,356 (173,962,074)
------------ ------------ -------------- --------------
Net increase (decrease) in net assets from operations 96,929,340 (28,550,603) 227,430,195 (75,262,908)
------------ ------------ -------------- --------------
Distributions to Shareholders (note 1)
From undistributed net investment income:
Common shareholders (37,862,338) (38,705,583) (78,312,431) (79,665,406)
Preferred shareholders (10,965,891) (9,581,324) (24,360,548) (19,792,559)
From accumulated net realized gains from investment
transactions:
Common shareholders -- (529,302) -- (883,406)
Preferred shareholders -- (82,589) -- (186,720)
------------ ------------ -------------- --------------
Decrease in net assets from distributions to shareholders (48,828,229) (48,898,798) (102,672,979) (100,528,091)
------------ ------------ -------------- --------------
Capital Share Transactions (note 2)
Common shares:
Net proceeds from Common shares issued to shareholders
due to reinvestment of distributions from net investment
income and from net realized gains from investment
transactions -- 2,110,084 -- --
Preferred shares, net proceeds from sale of shares -- -- -- --
------------ ------------ -------------- --------------
Net increase in net assets derived from capital share
transactions -- 2,110,084 -- --
------------ ------------ -------------- --------------
Net increase (decrease) in net assets 48,101,111 (75,339,317) 124,757,216 (175,790,999)
Net assets at beginning of year 801,481,899 876,821,216 1,717,022,592 1,892,813,591
------------ ------------ -------------- --------------
Net assets at end of year $849,583,010 $801,481,899 $1,841,779,808 $1,717,022,592
============ ============ ============== ==============
Balance of undistributed net investment income at end of year $ 1,137,948 $ 2,610,058 $ 3,205,372 $ 6,221,583
============ ============ ============== ==============
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<CAPTION>
NIF NPE
Year ended Year ended Year ended Year ended
10/31/95 10/31/94 10/31/95 10/31/94
<S> <C> <C> <C> <C>
Operations
Net investment income $ 22,900,239 $ 22,798,315 $ 16,224,285 $ 16,634,025
Net realized gain (loss) from investment transactions, net of
taxes, if applicable 3,892 (252,323) (1,944,767) (961,639)
Net change in unrealized appreciation or depreciation
of investments 28,757,014 (42,057,479) 31,478,880 (41,716,448)
------------ ------------ ------------ ------------
Net increase (decrease) in net assets from operations 51,661,145 (19,511,487) 45,758,398 (26,044,062)
------------ ------------ ------------ ------------
Distributions to Shareholders (note 1)
From undistributed net investment income:
Common shareholders (17,899,574) (18,348,977) (12,707,908) (14,311,525)
Preferred shareholders (5,531,433) (4,738,935) (4,215,008) (2,876,081)
From accumulated net realized gains from investment
transactions:
Common shareholders -- -- -- --
Preferred shareholders -- -- -- --
------------ ------------ ------------ ------------
Decrease in net assets from distributions to shareholders (23,431,007) (23,087,912) (16,922,916) (17,187,606)
------------ ------------ ------------ ------------
Capital Share Transactions (note 2)
Common shares:
Net proceeds from Common shares issued to shareholders
due to reinvestment of distributions from net investment
income and from net realized gains from investment
transactions -- -- -- --
Preferred shares, net proceeds from sale of shares -- -- -- --
------------ ------------ ------------ ------------
Net increase in net assets derived from capital share
transactions -- -- -- --
------------ ------------ ------------ ------------
Net increase (decrease) in net assets 28,230,138 (42,599,399) 28,835,482 (43,231,668)
Net assets at beginning of year 408,689,648 451,289,047 300,008,460 343,240,128
------------ ------------ ------------ ------------
Net assets at end of year $436,919,786 $408,689,648 $328,843,942 $300,008,460
============ ============ ============ ============
Balance of undistributed net investment income at end of year $ 783,988 $ 1,314,757 $ 265,613 $ 964,245
============ ============ ============ ============
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
NPX
Year ended Year ended
10/31/95 10/31/94
<S> <C> <C>
Operations
Net investment income $ 20,673,186 $ 20,193,798
Net realized gain (loss) from investment transactions, net of
taxes, if applicable (12,029,555) (10,409,736)
Net change in unrealized appreciation or depreciation
of investments 55,044,396 (55,190,281)
------------ ------------
Net increase (decrease) in net assets from operations 63,688,027 (45,406,219)
------------ ------------
Distributions to Shareholders (note 1)
From undistributed net investment income:
Common shareholders (15,419,632) (15,997,611)
Preferred shareholders (6,051,636) (4,047,134)
From accumulated net realized gains from investment
transactions:
Common shareholders -- --
Preferred shareholders -- --
------------ ------------
Decrease in net assets from distributions to shareholders (21,471,268) (20,044,745)
------------ ------------
Capital Share Transactions (note 2)
Common shares:
Net proceeds from Common shares issued to shareholders
due to reinvestment of distributions from net investment
income and from net realized gains from investment
transactions -- --
Preferred shares, net proceeds from sale of shares -- 156,068,392
------------ ------------
Net increase in net assets derived from capital share
transactions -- 156,068,392
------------ ------------
Net increase (decrease) in net assets 42,216,759 90,617,428
Net assets at beginning of year 385,691,600 295,074,172
------------ ------------
Net assets at end of year $427,908,359 $385,691,600
============ ============
Balance of undistributed net investment income at end of year $ 398,674 $ 1,196,756
============ ============
See accompanying notes to financial statements.
</TABLE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS
1. GENERAL INFORMATION AND SIGNIFICANT ACCOUNTING POLICIES
At October 31, 1995, 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), Nuveen
Insured Premium Income Municipal Fund, Inc. (NPE) and Nuveen Insured Premium
Income Municipal Fund 2 (NPX).
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
Portfolio securities for which market quotations are readily available are
valued at the mean between the quoted bid and asked prices or the yield
equivalent. Portfolio securities for which market quotations are not readily
available are valued at fair value by consistent application of methods
determined in good faith by the Board of Directors/Trustees. Temporary
investments in securities that have variable rate and demand features
qualifying them as short-term securities are traded and valued at amortized
cost.
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 be settled a month or more after the transaction date. 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 their purchase
commitments. At October 31, 1995, NQI and NPX had outstanding purchase
commitments of $8,300,000 and $6,450,920, respectively. There were no such
purchase commitments in NIO, NIF or NPE.
<PAGE>
Interest 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
The Funds intend to comply with the requirements of the Internal Revenue Code
applicable to regulated investment companies by distributing all of their net
investment income, in addition to any significant amounts of net realized
gains from investments, to shareholders. The Funds currently consider
significant net realized gains 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. All income dividends paid during the year ended October 31,
1995, have been designated Exempt Interest Dividends.
Dividends and Distributions to Shareholders
Net investment income is declared as a dividend monthly and payment is made or
reinvestment is credited to shareholder accounts after month-end. Net realized
gains from securities transactions are distributed to shareholders not less
frequently than annually only to the extent they exceed available capital loss
carryovers.
Distributions to shareholders of net investment income and net realized
capital gains are recorded on the ex-dividend date. The amount and timing of
such 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
result and will be classified as either distributions in excess of net
investment income or distributions in excess of net realized capital gains, if
applicable.
<PAGE>
<TABLE>
Preferred Shares
The following 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, except for those Series which have lengthened their current
dividend periods from seven days to three and five years (as indicated below).
The number of shares outstanding, by Series and in total, at October 31, 1995,
for each Fund is as follows:
<CAPTION>
NQI NIO NIF NPE
<S> <C> <C> <C> <C>
Number of shares:
Series M 2,600 4,000 -- --
Series T 2,600 4,000 -- 2,200
Series W 2,600* 4,000 -- --
Series Th -- 4,000 2,800 2,200
Series Th2 -- 4,000* -- --
Series F 2,600** 4,000 2,800* --
------ ------ ----- -----
Total 10,400 24,000 5,600 4,400
====== ====== ===== =====
<CAPTION>
NPX
<S> <C>
Number of shares:
Series M 2,080
Series T --
Series W 2,080
Series Th --
Series Th2 --
Series F 2,196
-----
Total 6,356
=====
<FN>
* Three year period ** Five year period
Preferred share auction fees paid in connection with lengthening the dividend
periods on the Series noted above have been capitalized and are being
amortized over the respective dividend periods.
</TABLE>
<PAGE>
Insurance
The Funds invest in municipal securities which are covered by insurance
guaranteeing the timely payment of principal and interest thereon or backed by
an escrow or trust account containing sufficient U.S. Government or U.S.
Government agency securities to 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
In October 1994, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 119 Disclosure about
Derivative Financial Instruments and Fair Value of Financial Instruments which
prescribes disclosure requirements for transactions 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 year ended
October 31, 1995, other than occasional purchases of high quality synthetic
money market securities which were held temporarily pending the re-investment
in long-term portfolio securities.
2. Fund Shares
There were no share transactions during the year ended October 31, 1995, in
any of the Funds. There were no share transactions during the year ended
October 31, 1994, in any of the Funds, except for 127,585 Common shares issued
due to reinvestment of distributions from net investment income and from net
realized gains from investment transactions by NQI and 6,356 Preferred shares
issued by NPX.
<PAGE>
<TABLE>
3. Securities Transactions
Purchase and sales (including maturities) of investments in municipal
securities and temporary municipal investments during the year ended October
31, 1995, were as follows:
<CAPTION>
NQI NIO NIF NPE
<S> <C> <C> <C> <C>
PURCHASES
Investments in municipal securities $240,681,480 $273,276,215 $21,438,566 $ 86,398,533
Temporary municipal investments 172,200,000 275,645,000 37,500,000 137,600,000
SALES AND MATURITIES
Investments in municipal securities 261,116,448 285,136,573 20,494,620 85,261,457
Temporary municipal investments 152,300,000 287,445,000 37,200,000 138,500,000
============ ============ =========== ============
<CAPTION>
NPX
<S> <C>
PURCHASES
Investments in municipal securities $116,844,877
Temporary municipal investments 99,110,000
SALES AND MATURITIES
Investments in municipal securities 118,444,279
Temporary municipal investments 96,710,000
============
At October 31, 1995, 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, 1995, the following Funds had unused capital loss carryovers
available for federal income tax purposes to be applied against future capital
gains, if any. If not applied, the carryovers will expire as follows:
<CAPTION>
NIF NPE NPX
<S> <C> <C> <C>
Expiration year:
2000 $323,662 $ -- $ --
2001 168,003 289,342 --
2002 252,323 961,639 10,409,736
2003 -- 1,944,767 12,029,555
-------- ---------- -----------
Total $743,988 $3,195,748 $22,439,291
======== ========== ===========
</TABLE>
<PAGE>
<TABLE>
4. DISTRIBUTIONS TO COMMON SHAREHOLDERS
On November 1, 1995, the Funds declared dividend distributions from their
ordinary income which were paid December 1, 1995, to shareholders of record on
November 15, 1995, as follows:
<CAPTION>
NQI NIO NIF NPE
<S> <C> <C> <C> <C>
Dividend per share $.0820 $.0820 $.0780 $.0670
====== ====== ====== ======
<CAPTION>
NPX
<S> <C>
Dividend per share $.0595
======
5. UNREALIZED APPRECIATION (DEPRECIATION)
Gross unrealized appreciation and gross unrealized depreciation of investments
at October 31, 1995, were as follows:
<CAPTION>
NQI NIO NIF NPE
<S> <C> <C> <C> <C>
Gross unrealized:
Appreciation $61,342,512 $128,393,875 $31,683,312 $11,989,342
Depreciation (148,182) (1,515,015) (10,107) (75,550)
----------- ------------ ----------- ------------
Net unrealized appreciation $61,194,330 $126,878,860 $31,673,205 $11,913,791
=========== ============ =========== ===========
<CAPTION>
NPX
<S> <C>
Gross unrealized:
Appreciation $7,770,566
Depreciation (3,136,037)
----------
Net unrealized appreciation $4,634,529
==========
</TABLE>
<PAGE>
<TABLE>
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 to the Adviser 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:
<CAPTION>
Average daily net asset value Management fee
<S> <C>
For the first $125,000,000 .65 of 1%
For the next $125,000,000 .6375 of 1
For the next $250,000,000 .625 of 1
For the next $500,000,000 .6125 of 1
For the next $1,000,000,000 .6 of 1
For net assets over $2,000,000,000 .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 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.
</TABLE>
<PAGE>
<TABLE>
7. COMPOSITION OF NET ASSETS
At October 31, 1995, net assets consisted of:
<CAPTION>
NQI NIO NIF NPE
<S> <C> <C> <C> <C>
Preferred shares, $25,000 stated value per share,
at liquidation value $260,000,000 $ 600,000,000 $140,000,000 $110,000,000
Common shares, $.01 par value per share 373,396 795,858 191,235 151,285
Paid-in surplus 520,013,891 1,104,893,119 265,015,346 209,709,001
Balance of undistributed net investment income 1,137,948 3,205,372 783,988 265,613
Accumulated net realized gain (loss) from investment transactions 6,863,445 6,006,599 (743,988) (3,195,748)
Net unrealized appreciation or depreciation of investments 61,194,330 126,878,860 31,673,205 11,913,791
----------- ------------- ----------- -----------
Net assets $849,583,010 $1,841,779,808 $436,919,786 $328,843,942
============ ============== ============ ============
Authorized shares:
Common 200,000,000 200,000,000 200,000,000 200,000,000
Preferred 1,000,000 1,000,000 1,000,000 1,000,000
============ ============== ============ ============
<CAPTION>
NPX
<S> <C>
Preferred shares, $25,000 stated value per share,
at liquidation value $158,900,000
Common shares, $.01 par value per share 206,421
Paid-in surplus 286,208,026
Balance of undistributed net investment income 398,674
Accumulated net realized gain (loss) from investment transactions (22,439,291)
Net unrealized appreciation or depreciation of investments 4,634,529
------------
Net assets $427,908,359
============
Authorized shares:
Common Unlimited
Preferred Unlimited
============
</TABLE>
<PAGE>
<TABLE>
8. Investment Composition
Each Fund invests in municipal securities which include general obligation,
escrowed and revenue bonds. At October 31, 1995, the revenue sources by
municipal purpose for these investments, expressed as a percent of total
investments, were as follows:
<CAPTION>
NQI NIO NIF NPE
<S> <C> <C> <C> <C>
Revenue Bonds:
Housing Facilities 23% 19% 10% 9%
Health Care Facilities 20 21 15 14
Pollution Control Facilities 8 11 17 18
Transportation 4 3 7 12
Electric Utilities 4 3 3 5
Water / Sewer Facilities 4 5 1 4
Lease Rental Facilities 2 4 3 7
Educational Facilities 2 3 1 3
Other 6 5 4 4
General Obligation Bonds 6 6 6 15
Escrowed Bonds 21 20 33 9
---- ---- ---- ----
100% 100% 100% 100%
==== ==== ==== ====
<CAPTION>
NPX
<S> <C>
Revenue Bonds:
Housing Facilities 14%
Health Care Facilities 10
Pollution Control Facilities 9
Transportation 11
Electric Utilities 9
Water / Sewer Facilities 9
Lease Rental Facilities 1
Educational Facilities 4
Other 6
General Obligation Bonds 23
Escrowed Bonds 4
----
100%
====
</TABLE>
<PAGE>
All of the long-term and intermediate-term investments owned by the Funds are
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, either 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 any of
the Funds' shares.
All of the temporary investments in short-term municipal securities have
credit enhancements (letters of credit, guarantees or insurance) issued by
third party domestic or foreign banks or other institutions.
For additional information regarding each investment security, refer to the
Portfolio of Investments of each Fund.
<PAGE>
<TABLE>
FINANCIAL HIGHLIGHTS
SELECTED DATA FOR A COMMON SHARE OUTSTANDING THROUGHOUT EACH PERIOD IS AS
FOLLOWS:
<CAPTION>
Operating performance Dividends from net
investment income
Net
realized and
Net asset unrealized
value Net gain (loss)
beginning investment from To Common To Preferred
of period income investmentstt shareholders shareholderst
NQI
<S> <C> <C> <C> <C> <C>
Year ended 10/31,
1995 $14.500 $1.269 $ 1.329 $(1.014) $(.294)
1994 16.580 1.269 (2.038) (1.038) (.257)
1993 15.110 1.320 1.574 (1.194) (.212)
1992 14.850 1.347 .244 (1.067) (.229)
12/19/90 to
10/31/91 14.050 1.004 .849 (.684) (.190)
<CAPTION>
NIO
<S> <C> <C> <C> <C> <C>
Year ended 10/31,
1995 14.040 1.252 1.598 (.984) (.306)
1994 16.240 1.238 (2.175) (1.001) (.249)
1993 14.400 1.238 1.897 (1.039) (.232)
1992 14.130 1.128 .346 (.874) (.183)
9/19/91 to
10/31/91 14.050 .052 .045 -- --
<CAPTION>
NIF
<S> <C> <C> <C> <C> <C>
Year ended 10/31,
1995 14.050 1.197 1.508 (.936) (.289)
1994 16.280 1.192 (2.214) (.960) (.248)
1993 14.030 1.204 2.233 (.975) (.212)
12/19/91 to
10/31/92 14.050 .760 .100 (.600) (.093)
<CAPTION>
NPE
<S> <C> <C> <C> <C> <C>
Year ended 10/31,
1995 12.560 1.073 1.956 (.840) (.279)
1994 15.420 1.100 (2.824) (.946) (.190)
12/17/92 to
10/31/93 14.050 .779 1.453 (.584) (.095)
<CAPTION>
NPX
<S> <C> <C> <C> <C> <C>
Year ended 10/31,
1995 10.990 1.001 2.079 (.747) (.293)
1994 14.290 .978 (3.170) (.775) (.196)
7/22/93 to
10/31/93 14.050 .114 .228 (.064) --
<PAGE>
<CAPTION>
Distributions from capital gains
Organization Per
and offering Common
costs and share
Preferred share Net asset market
To Common To Preferred underwriting value end value end
shareholders shareholderst discounts of period of period
NQI
<S> <C> <C> <C> <C> <C>
Year ended 10/31,
1995 $ -- $ -- $ -- $15.790 $15.000
1994 (.014) (.002) -- 14.500 13.125
1993 (.015) (.003) -- 16.580 17.375
1992 (.027) (.008) -- 15.110 15.250
12/19/90 to
10/31/91 -- -- (.179) 14.850 15.500
<CAPTION>
NIO
<S> <C> <C> <C> <C> <C>
Year ended 10/31,
1995 -- -- -- 15.600 14.875
1994 (.011) (.002) -- 14.040 13.000
1993 (.019) (.005) -- 16.240 16.125
1992 -- -- (.147) 14.400 14.000
9/19/91 to
10/31/91 -- -- (.017) 14.130 14.875
<CAPTION>
NIF
<S> <C> <C> <C> <C> <C>
Year ended 10/31,
1995 -- -- -- 15.530 14.500
1994 -- -- -- 14.050 12.500
1993 -- -- -- 16.280 15.625
12/19/91 to
10/31/92 -- -- (.187) 14.030 14.000
<CAPTION>
NPE
<S> <C> <C> <C> <C> <C>
Year ended 10/31,
1995 -- -- -- 14.470 12.750
1994 -- -- -- 12.560 11.125
12/17/92 to
10/31/93 -- -- (.183) 15.420 15.000
<CAPTION>
NPX
<S> <C> <C> <C> <C> <C>
Year ended 10/31,
1995 -- -- -- 13.030 11.375
1994 -- -- (.137) 10.990 9.875
7/22/93 to
10/31/93 -- -- (.038) 14.290 13.875
<PAGE>
<CAPTION>
Ratios/Supplemental data
Ratio
Total of net
Investment Total Ratio of investment
Return Return Net assets expenses to income Portfolio
on market on net asset end of period average net to average turnover
value** value** (in thousands) assetsttt net assetsttt rate
NQI
<S> <C> <C> <C> <C> <C> <C>
Year ended 10/31,
1995 22.62% 16.43% $ 849,583 .81% 5.73% 30%
1994 (19.13) (6.43) 801,482 .82 5.64 22
1993 22.55 18.34 876,821 .80 5.76 7
1992 5.32 9.36 815,993 .78 6.06 5
12/19/90 to
10/31/91 8.04 10.83 801,050 .77* 6.14* 33
<CAPTION>
NIO
<S> <C> <C> <C> <C> <C> <C>
Year ended 10/31,
1995 22.78 18.74 1,841,780 .79 5.59 16
1994 (13.60) (7.59) 1,717,023 .79 5.44 20
1993 23.41 20.75 1,892,814 .81 5.36 5
1992 (.14) 8.21 1,745,207 .79 5.55 13
9/19/91 to
10/31/91 (.83) .57 1,116,736 .77* 4.00* --
<CAPTION>
NIF
<S> <C> <C> <C> <C> <C> <C>
Year ended 10/31,
1995 24.14 17.73 436,920 .81 5.40 5
1994 (14.53) (8.06) 408,690 .81 5.30 4
1993 19.03 23.67 451,289 .81 5.31 9
12/19/91 to
10/31/92 (2.77) 4.13 407,907 .81* 5.00* 3
<CAPTION>
NPE
<S> <C> <C> <C> <C> <C> <C>
Year ended 10/31,
1995 22.67 22.56 328,844 .82 5.12 28
1994 (20.42) (12.88) 300,008 .82 5.14 16
12/17/92 to
10/31/93 4.01 14.13 343,240 .81* 4.75* 10
<CAPTION>
NPX
<S> <C> <C> <C> <C> <C> <C>
Year ended 10/31,
1995 23.46 26.20 427,908 .83 5.07 30
1994 (23.99) (18.24) 385,692 .83 4.83 25
7/22/93 to
10/31/93 (7.08) 2.16 295,074 .86* 3.16* --
<FN>
* 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.
t The amounts shown are based on Common share equivalents.
tt Net of taxes, if applicable.
ttt Ratios do not reflect the effect of dividend payments to Preferred
shareholders.
</TABLE>
<PAGE>
REPORT OF INDEPENDENT AUDITORS
The Board of Directors, Trustees and Shareholders
Nuveen Insured Quality Municipal Fund, Inc.
Nuveen Insured Municipal Opportunity Fund, Inc.
Nuveen Premier Insured Municipal Income Fund, Inc.
Nuveen Insured Premium Income Municipal Fund, Inc.
Nuveen Insured Premium Income Municipal Fund 2
We have audited the accompanying statements of net assets, including the
portfolios of investments, of Nuveen Insured Quality Municipal Fund, Inc.,
Nuveen Insured Municipal Opportunity Fund, Inc., Nuveen Premier Insured
Municipal Income Fund, Inc., Nuveen Insured Premium Income Municipal Fund,
Inc. and Nuveen Insured Premium Income Municipal Fund 2 as of October 31,
1995, and the related statements of operations and changes in net assets and
the financial highlights for the periods indicated therein. These financial
statements and financial highlights are the responsibility of the Funds'
management. Our responsibility is to express an opinion on these financial
statements and financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. Our procedures included confirmation of investments
owned as of October 31, 1995, by correspondence with the custodian and
brokers. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial positions of
Nuveen Insured Quality Municipal Fund, Inc., Nuveen Insured Municipal
Opportunity Fund, Inc., Nuveen Premier Insured Municipal Income Fund, Inc.,
Nuveen Insured Premium Income Municipal Fund, Inc. and Nuveen Insured Premium
Income Municipal Fund 2 at October 31, 1995, and the results of their
operations, changes in their net assets and financial highlights for the
periods indicated therein in conformity with generally accepted accounting
principles.
Ernst & Young LLP
Chicago, Illinois
December 15, 1995
<PAGE>
Build your wealth automatically
Photographic image of Customer Service Rep at Nuveen.
Managing your portfolio takes skill, experience, and informed judgment, but
our efforts to help you build your wealth don't stop there. At Nuveen, we
offer a number of convenient ways to build your tax-free portfolio and earn
the tax-free income you need to achieve your financial goals.
Nuveen Exchange-traded fund Dividend Reinvestment Plan
Your Nuveen exchange-traded fund allows you to conveniently reinvest dividends
and/or capital gains distributions in additional fund shares. If you do not
elect to reinvest distributions, all distributions are paid by check, or can
be deposited directly into your bank or brokerage account.
By choosing to reinvest, you'll be able to set aside money regularly and
automatically, and watch your investment grow through the power of tax-free
compounding. Income or capital gains taxes may be payable on dividends or
distributions that are reinvested. You'll also benefit from dollar-cost
averaging, a technique of investing at regular intervals, which allows you to
build a high-quality, tax-free portfolio conveniently and cost effectively
over time. All reinvestments are invested in full and fractional shares and
are kept in non-certificated form by the Plan Agent, Chase Manhattan Bank.
To make recordkeeping easy and convenient, each month you'll receive a
statement showing your total dividends and distributions, the date of
investment, the shares acquired and the price per share, and the total number
of shares you own.
The shares you acquire by reinvesting will either be purchased on the open
market or be newly issued by the Fund. If the shares are trading at or above
net asset value at the time of valuation, the Fund will issue new shares at
the then-current market price. If the shares are trading at less than net
asset value, shares for your account will be purchased on the open market.
Dividends and distributions received to purchase shares in the open market
will be invested within 30 days of the dividend payment date; no interest will
be paid on dividends and distributions awaiting reinvestment. Because the
market price of shares may increase before purchases are completed, the
average purchase price per share may exceed the market price at the time of
valuation resulting in the acquisition of fewer shares than if the dividend or
distribution had been paid in shares issued by the Fund. A pro rata portion of
any applicable brokerage commissions on open market purchases will be paid by
Plan participants. These commissions usually will be lower than those charged
on individual transactions.
<PAGE>
You may, of course, change your distribution option or withdraw from the
Plan at any time, should your needs or situation change. Should you withdraw,
you can receive a certificate for all whole shares credited to your
reinvestment account and cash payment for fractional shares, or cash payment
for all reinvestment account shares, less brokerage commissions and a $2.50
service fee.
You also can reinvest if your shares are registered in the name of a
brokerage firm, bank, or other nominee. Just ask your investment adviser if
the firm will participate on your behalf. If not, it's easy to have the shares
registered in your name and to apply for a reinvestment account directly.
Participants whose shares are registered in the name of one firm may not be
able to transfer the shares to another firm and continue to participate in the
Plan.
The Fund reserves the right to amend or terminate the Plan at any time.
Although, the Fund reserves the right to amend the Plan to include a service
charge payable by the participants, there is no direct service charge to
participants in the Plan at this time.
For more information on the Nuveen Automatic Reinvestment Plan or to enroll
in or withdraw from the Plan, speak with your investment adviser or call us
toll-free at 1.800.257.8787.
Photographic image of Customer Service Rep at Nuveen.
"When it comes to financial planning, your investment adviser knows your
situation best. And when we can give you the account information you need, our
motto is simple: We're here to help."
Photographic image of Customer Service Rep at Nuveen.
"At Nuveen, we make reinvesting easy. A phone call is all it takes to set up
your reinvestment account."
<PAGE>
Useful information
Photographic image of Customer Service Rep at Nuveen.
"When questions come up about your investment, we're happy to provide the
up-to-date information you and your adviser need."
Nuveen Shareholder Services:
1.800.257.8787
Call Monday through Friday, 9 a.m. to 6 p.m., EST for information on your
Nuveen Fund's current account balance, yield, dividend, net asset value,
closing price, and general information.
Dividend Reinvestment:
1.800.257.8787
Monday through Friday, 9 a.m. to 6 p.m., EST
Taking Stock Newsletter:
1.800.257.8787
Call Monday through Friday, 9 a.m. to 6 p.m., EST if you're not currently
getting our quarterly shareholder newsletter and would like to do so. We will
be happy to add your name to our mailing list.
Photographic image of woman seated and man standing behind her representing
Nuveen investors.
Many conservative investors are comfortable with Nuveen's emphasis on long
term value. That's why they depend on Nuveen for the tax-free income they need
to reach their goals.
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Your investment partner
Photographic image of John Nuveen, Sr., founder of Nuveen.
For nearly 100 years, Nuveen has earned its reputation as a tax-free income
specialist by focusing on municipal bonds.
Since 1898, John Nuveen & Co. Incorporated has worked to bring together the
various participants in the municipal bond industry and build strong
partnerships that benefit all concerned. Investors, financial advisers,
municipal officials, investment bankers--Nuveen believes that forging
relationships with these groups based on trust and value is the key to
successful investing.
As the oldest and largest municipal bond specialist in the United States,
Nuveen's investment bankers work with issuers to understand and meet their
needs in structuring and selling their bond issues.
Nuveen also works closely with financial advisers around the country,
including brokerage firms, banks, insurance companies, and independent
financial planners, to bring the benefits of tax-free investing to you. These
advisers are experts at identifying your needs and recommending the best
solutions for your situation. Together we make a powerful team, helping you
create a successful investment plan that meets your needs today and in the
future.
John Nuveen & Co. Incorporated
333 West Wacker Drive
Chicago, Illinois 60606-1286
ETF4-DEC 95
