<PAGE> 1
TABLE OF CONTENTS
<TABLE>
<S> <C>
Letter to Shareholders........................... 1
Performance Results.............................. 5
Portfolio of Investments......................... 6
Statement of Assets and Liabilities.............. 9
Statement of Operations.......................... 10
Statement of Changes in Net Assets............... 11
Financial Highlights............................. 12
Notes to Financial Statements.................... 13
</TABLE>
VTN SAR 6/97
<PAGE> 2
LETTER TO SHAREHOLDERS
June 5, 1997
Dear Shareholder,
As mentioned in your previous
report, VK/AC Holding, Inc., the parent
company of Van Kampen American Capital,
Inc., was acquired by Morgan Stanley
Group Inc., a world leader in asset
management. More recently, on February [PHOTO]
5, 1997, Morgan Stanley Group Inc. and
Dean Witter, Discover & Co. announced
their agreement to merge, and you DENNIS J. MCDONNELL AND DON G. POWELL
received a proxy in April. The merger
was completed on May 31, 1997, creating
the combined company of Morgan Stanley, Dean Witter, Discover & Co. This
preeminent global financial services firm boasts a market capitalization of $21
billion and leading market positions in securities, asset management, and credit
services. As the financial industry continues to witness unprecedented
consolidations and new partnerships, we believe that those firms that are
leaders in all facets of their business will be able to offer investors the
greatest opportunities and services as we move into the next century. We are
confident that this merger will provide investors with those benefits.
ECONOMIC REVIEW
Bond prices were volatile during the six months ended April 30, 1997. Prices
initially rose as the economy slowed, erasing fears of an interest rate hike by
the Federal Reserve Board. The November election of a Democratic president and
Republican Congress was positive for bonds because the split government was
viewed as a restraint on spending increases that could potentially swell the
budget deficit. In addition, support diminished for radical tax reform that
could threaten the tax-free status of municipal bonds.
By the beginning of 1997, the situation changed. Bond prices began to fall
as the economy picked up speed, culminating in a 5.60 percent annualized growth
rate in the first quarter. This strength, coupled with warnings by Fed Chairman
Alan Greenspan that tighter monetary policy might be appropriate, reignited
fears of a rate hike. On March 25, the Fed raised short-term rates by a modest
0.25 percent, which sent the 30-year Treasury bond yield above 7.00 percent for
the first time in six months. By the end of April, the 30-year Treasury bond
yield slipped back below 7.00 percent as the market turned its attention to
positive news about inflation, and bonds recovered some of their earlier losses.
Throughout most of the six months ended April 30, municipal bonds generally
outperformed Treasuries. Between October 31 and April 30, yields on long-term
municipal revenue bonds rose 21 basis points, while yields on 30-year Treasury
bonds jumped 31 basis points. Because bond yields move in the opposite direction
of prices, the smaller
Continued on page two
1
<PAGE> 3
increase in municipal yields meant that municipal bond prices did not fall as
sharply as Treasury bond prices did. A relatively stable supply of new issues,
combined with an increase in retail demand, contributed to the improved
performance of municipal bonds.
The New York state economy experienced steady growth, although its pace
lagged the national growth rate. The state had some success in controlling
spending, but this did not eliminate fears of future budget deficits, due in
part to tax cuts. The state's budget process, which has resulted in late budgets
for 13 consecutive years, remains dysfunctional.
FUND STRATEGY
In managing the Trust, we maintained a "barbell" approach to credit quality,
which means we weighed investments in both the highest and lowest levels of the
quality spectrum. Investing at both ends of the ratings spectrum helps to
potentially balance the portfolio's volatility to interest rate movements.
AAA-rated securities have tended to perform better when interest rates are
declining and provide the potential for safety of principal. They are extremely
liquid because most are insured bonds. BBB-rated securities have tended to
perform better when rates are rising, and they have the potential to provide
additional income. As of April 30, approximately 34 percent of the Trust's long-
term investments were rated AAA, the highest credit rating assigned to bonds by
the Standard & Poor's Ratings Group, and approximately 30 percent were rated AA
or A. In addition, approximately 36 percent of long-term investments were rated
BBB or lower. BBB is the lowest rating Standard & Poor's assigns to bonds in the
investment-grade category.
[CREDIT QUALITY GRAPH]
Portfolio Composition by Credit Quality as a Percentage of Long-Term
Investments as of April 30, 1997
<TABLE>
<S> <C>
AAA...................... 34.1%
AA....................... 23.1%
A........................ 7.1%
BBB...................... 34.4%
BB....................... 1.3%
</TABLE>
Based upon credit quality ratings issued by Standard & Poor's. For securities
not rated by Standard & Poor's, the Moody's rating is used.
Portfolio turnover during the period was minimal because market conditions
offered few opportunities to add value over existing holdings. The average
yields of bonds in the portfolio were higher than yields available in the
current market. In addition, yield spreads remained narrow between AAA-rated
bonds and lower-rated bonds. As a result, there was often not enough yield
reward to justify the credit risk associated with purchasing additional
lower-rated securities.
Activity focused on enhancing the portfolio's call protection by selling
bonds that could potentially be called in the near term and replacing them with
noncallable bonds or discount securities. In other words, we hope to lessen the
concentration of bonds that can
Continued on page three
2
<PAGE> 4
be called at any one time. When buying new securities for the portfolio, we
attempt to identify those bonds that we believe will outperform within a
particular sector and that can be purchased at an attractive price. We believe
this "bottom-up" approach, supported by our research, provides significant added
value to the portfolio.
We maintained a short to neutral duration during this period of rising
interest rates in order to potentially reduce the Trust's volatility to rate
increases. Duration, which is expressed in years, is a measure of a portfolio's
sensitivity to interest rate movements. Portfolios with long durations have
tended to perform better when rates are falling, and portfolios with short
durations have tended to perform better when rates are rising. At the end of the
period, the Trust's duration stood at 7.17 years compared to 8.16 years for the
Lehman Brothers New York Municipal Bond Index benchmark.
[DISTRIBUTION HISTORY GRAPH]
Six-month Distribution History
For the Period Ended April 30, 1997
<TABLE>
<CAPTION>
Distribution per Share
<S> <C>
Nov 1996............................ $.0750
Dec 1996............................ $.1073
Jan 1997............................ $.0750
Feb 1997............................ $.0750
Mar 1997............................ $.0750
Apr 1997............................ $.0750
</TABLE>
The dividend and/or capital gains history represents past performance of the
Trust and does not predict the Trust's future distributions.
PERFORMANCE SUMMARY
For the six-month period ended April 30, 1997, the Van Kampen American
Capital Trust for Investment Grade New York Municipals generated a total return
at market price of 2.41 percent(1). The Trust offered a tax-exempt distribution
rate of 6.21 percent(3), based on the closing common stock price of $14.50 per
share on April 30, 1997. Because income from the Trust is exempt from federal
and New York state income taxes, this distribution rate represents a yield
equivalent to a taxable investment earning 10.45 percent(4) (for investors in
the combined federal and state income tax bracket of 40.6 percent). At the end
of the reporting period, the closing share price of the Trust traded at a 11.85
percent discount to its net asset value of $16.45.
The Trust declared a capital gains distribution of $0.0323 per share payable
on December 31, 1996, due to the sale of some assets that had appreciated in
value.
Continued on page four
3
<PAGE> 5
Top Five Portfolio Holdings by Sector as of April 30, 1997*
General Purpose................... 22.3%
Transportation.................... 14.3%
Public Building.................... 9.2%
Health Care........................ 9.1%
Other Care......................... 8.9%
*As a Percentage of Long-Term Investments
MUNICIPAL MARKET OUTLOOK
We continue to see signs of a strong economy, although we do not expect the
unusually brisk growth rate of the first quarter to be sustained throughout the
year. As a result, we believe the Fed will monitor the economy closely and take
aggressive action to control growth if inflation picks up or the high growth
rate is sustained. However, if growth slows, we believe the Fed will leave rates
unchanged. Given this outlook, we expect that yields on the 30-year Treasury
bond will range between 6.75 and 7.40 percent for the remainder of the year,
with higher levels occurring early and lower yields dominating the second half
of 1997. Although short-term interest rates have risen, this has not had a
significant impact on the leveraged structure of the Trust.
We believe the Trust is positioned to perform well in the coming months, and
we do not anticipate major structural changes in the portfolio. In light of our
expectations for interest rates, we will continue to maintain a slightly
defensive posture by keeping a relatively short duration for the portfolio and
adjusting the duration when prudent. We will also continue to seek a balance
between the Trust's total return and its dividend income, as well as to add
value through security selection. Thank you for your continued confidence in Van
Kampen American Capital and your Trust's team of managers.
Sincerely,
[SIG]
Don G. Powell
Chairman
Van Kampen American Capital
Investment Advisory Corp.
[SIG]
Dennis J. McDonnell
President
Van Kampen American Capital
Investment Advisory Corp.
Please see footnotes on page five
4
<PAGE> 6
PERFORMANCE RESULTS FOR THE PERIOD ENDED APRIL 30, 1997
VAN KAMPEN AMERICAN CAPITAL TRUST FOR INVESTMENT GRADE
NEW YORK MUNICIPALS
(NYSE TICKER SYMBOL--VTN)
<TABLE>
<S> <C>
COMMON SHARE TOTAL RETURNS
Six-month total return based on market price(1)............ 2.41%
Six-month total return based on NAV(2)..................... 1.82%
DISTRIBUTION RATES
Distribution rate as a % of closing common stock
price(3)................................................. 6.21%
Taxable-equivalent distribution rate as a % of closing
common stock price(4)...................................... 10.45%
SHARE VALUATIONS
Net asset value............................................ $ 16.45
Closing common stock price................................. $14.500
Six-month high common stock price (03/07/97)............... $15.250
Six-month low common stock price (04/29/97)................ $14.250
Preferred share rate(5).................................... 3.668%
</TABLE>
(1) Total return based on market price assumes an investment at the market price
at the beginning of the period indicated, reinvestment of all distributions for
the period in accordance with the Trust's dividend reinvestment plan, and sale
of all shares at the closing common stock price at the end of the period
indicated.
(2) Total return based on net asset value (NAV) assumes an investment at the
beginning of the period indicated, reinvestment of all distributions for the
period, and sale of all shares at the end of the period, all at NAV.
(3) Distribution rate represents the monthly annualized distributions of the
Trust at the end of the period and not the earnings of the Trust.
(4) The taxable-equivalent distribution rate is calculated assuming a 40.6%
combined federal and state income tax bracket, which takes into consideration
the deductibility of individual state taxes paid.
(5) See "Notes to Financial Statements" footnote #5, for more information
concerning Preferred Share reset periods.
A portion of the interest income may be taxable for those investors subject to
the federal alternative minimum tax (AMT).
Past performance does not guarantee future results. Investment return, stock
price and net asset value will fluctuate with market conditions. Trust shares,
when sold, may be worth more or less than their original cost.
Market forecasts provided in this report may not necessarily come to pass.
5
<PAGE> 7
PORTFOLIO OF INVESTMENTS
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par
Amount
(000) Description Coupon Maturity Market Value
- --------------------------------------------------------------------------------------------------
<C> <S> <C> <C> <C>
MUNICIPAL BONDS
NEW YORK 88.8%
$ 1,850 Albany Cnty, NY Arpt Auth Arpt Rev (FSA Insd)... 5.500% 12/15/19 $ 1,756,982
3,000 Cohoes, NY Indl Dev Agy Indl Dev Rev Norlite
Corp Proj Ser B (Prerefunded @ 05/01/02)........ 6.750 05/01/09 3,290,010
1,210 Erie Cnty, NY Wtr Auth Wtr Rev Fourth Resolution
Rfdg (AMBAC Insd)............................... * 12/01/17 277,344
3,870 Grand Cent Dist Mgmt Assn Inc NY Business Impt
Dist Cap Impt (Prerefunded @ 01/01/02).......... 6.500 01/01/22 4,206,535
1,150 Groton, NY Cmnty Hlthcare Cent Inc Hlthcare Fac
Rev Groton Cmnty Ser A (FHA Gtd)................ 7.450 07/15/21 1,291,588
2,295 Metropolitan Tran Auth NY Svcs Contract Commuter
Fac Ser O....................................... 5.750 07/01/07 2,317,675
3,000 Metropolitan Tran Auth NY Svcs Contract Tran Fac
Ser 5 Rfdg...................................... 7.000 07/01/12 3,225,390
1,355 Nassau Cnty, NY Genl Impt Ser Q (FGIC Insd)..... 5.200 08/01/13 1,306,911
1,100 Nassau Cnty, NY Genl Impt Ser Q (FGIC Insd)..... 5.200 08/01/14 1,047,772
1,000 New York City Subser A1 (Embedded Swap)......... 5.510 08/01/12 940,000
2,500 New York City Indl Dev Agy Civic Fac Rev The
Lighthouse Inc.................................. 6.500 07/01/22 2,637,600
2,000 New York City Ser A Rfdg........................ 7.000 08/01/04 2,167,260
10,000 New York City Ser B (Embedded Cap).............. 6.600 10/01/16 10,353,800
2,750 New York City Ser D............................. 6.500 02/15/06 2,907,960
745 New York City Ser D............................. 7.500 02/01/16 818,561
795 New York City Ser D............................. 7.500 02/01/17 876,670
1,270 New York City Ser D (Prerefunded @ 02/01/02).... 7.500 02/01/16 1,430,109
205 New York City Ser D (Prerefunded @ 02/01/02).... 7.500 02/01/17 230,844
2,300 New York City Ser G Rfdg........................ 5.700 08/01/08 2,275,344
7,900 New York City Ser I Rfdg (FSA Insd)............. * 08/01/01 6,470,258
1,000 New York St Dorm Auth Rev Court Fac Lease Ser
A............................................... 5.625 05/15/13 965,670
1,500 New York St Dorm Auth Rev Court Fac Lease Ser
A............................................... 5.375 05/15/16 1,372,935
2,500 New York St Dorm Auth Rev Grace Manor Hlthcare
Fac............................................. 6.150 07/01/18 2,545,225
4,460 New York St Dorm Auth Rev Mtg KMH Homes Inc (FHA
Gtd)............................................ 6.950 08/01/31 4,748,964
1,835 New York St Dorm Auth Rev NY Pub Lib Ser A (MBIA
Insd)........................................... * 07/01/02 1,428,749
1,910 New York St Dorm Auth Rev NY Pub Lib Ser A (MBIA
Insd)........................................... * 07/01/03 1,406,658
1,000 New York St Dorm Auth Rev Nyack Hosp Rfdg....... 6.250 07/01/13 1,017,670
5,010 New York St Dorm Auth Rev St Univ Edl Fac Ser B
Rfdg (AMBAC Insd)............................... 5.250 05/15/19 4,608,198
4,100 New York St Energy Resh & Dev Auth Elec Fac Rev
Cons Edison Co NY Inc Proj Ser A (MBIA Insd).... 6.750 01/15/27 4,328,985
1,500 New York St Energy Resh & Dev Auth Gas Fac Rev
Brooklyn Union Gas Ser B (MBIA Insd)............ 6.750 02/01/24 1,611,495
</TABLE>
See Notes to Financial Statements
6
<PAGE> 8
PORTFOLIO OF INVESTMENTS (CONTINUED)
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par
Amount
(000) Description Coupon Maturity Market Value
- --------------------------------------------------------------------------------------------------
<C> <S> <C> <C> <C>
NEW YORK (CONTINUED)
$ 4,000 New York St Energy Resh & Dev Auth Gas Fac Rev
Brooklyn Union Gas Ser C (MBIA Insd)............ 5.600% 06/01/25 $ 3,796,760
2,000 New York St Environmental Fac Corp St Wtr
Pollutn Ctl Rev Ser E........................... 6.600 06/15/09 2,176,240
3,500 New York St Hsg Fin Agy Rev Multi-Family Hsg
Secured Mtg Pgm Ser A........................... 7.050 08/15/24 3,686,620
1,935 New York St Hsg Fin Agy Rev Multi-Family Hsg
Secured Mtg Pgm Ser C........................... 6.950 08/15/24 2,026,932
1,970 New York St Loc Govt Assistance Corp Ser B
(Prerefunded 04/01/01).......................... 7.250 04/01/07 2,184,769
4,675 New York St Med Care Fac Fin Agy Rev Hosp &
Nursing Home Methodist Ser A (FHA Gtd).......... 6.700 08/15/23 4,917,492
1,000 New York St Med Care Fac Fin Agy Rev Long Term
Hlth Care Ser A (Cap Guar Insd)................. 6.800 11/01/14 1,072,110
300 New York St Med Care Fac Fin Agy Rev Mental Hlth
Svcs Fac Ser C.................................. 7.300 02/15/21 328,431
570 New York St Med Care Fac Fin Agy Rev Mental Hlth
Svcs Fac Ser C (Prerefunded @ 08/15/01)......... 7.300 02/15/21 635,921
3,000 New York St Med Care Fac Fin Agy Rev
Presbyterian Hosp Ser A Rfdg (MBIA Insd)........ 5.375 02/15/25 2,803,230
2,050 New York St Med Care Fac Fin Agy Rev Saint
Peter's Hosp Proj Ser A (AMBAC Insd)............ 5.375 11/01/20 1,920,276
4,500 New York St Med Care Fac Fin Agy Rev Shorefront
Saint Lukes & Wtrfront Nursing Homes............ 6.950 02/15/32 4,808,070
4,000 New York St Mtg Agy Rev Homeowner Mtg Ser 28.... 7.050 10/01/23 4,193,240
2,000 New York St Mtg Agy Rev Homeowner Mtg Ser 42
(FHA Gtd)....................................... 6.400 10/01/20 2,047,600
1,795 New York St Mtg Agy Rev Homeowner Mtg Ser 52.... 6.100 04/01/26 1,780,425
1,000 New York St Muni Bond Bk Agy Spl Pgm Rev Buffalo
Ser A........................................... 6.875 03/15/06 1,068,710
2,000 New York St Thruway Auth Svc Contract Rev Loc
Hwy & Brdg...................................... 5.750 04/01/08 2,006,320
2,500 New York St Urban Dev Corp Rev Correctional Cap
Fac Ser A Rfdg.................................. 5.500 01/01/14 2,384,375
1,625 New York St Urban Dev Corp Rev Proj Cent for
Indl Innovation Rfdg............................ 5.500 01/01/13 1,564,599
20,000 New York St Urban Dev Corp Rev St Office South
Mall Ser A...................................... * 01/01/11 8,843,400
1,750 Niagara Falls, NY Brdg Comm Toll Rev
(Prerefunded @ 10/01/02) (FGIC Insd)............ 6.125 10/01/19 1,887,795
4,500 Port Auth NY & NJ Cons 97th Ser (FGIC Insd)..... 6.650 01/15/23 4,796,685
2,000 Port Auth NY & NJ Delta Airls Inc Proj Ser 1R... 6.950 06/01/08 2,122,180
2,405 Rensselaer, NY Hsg Auth Multi-Family Rev Mtg
Renwyck Pl Ser A................................ 7.650 01/01/11 2,590,257
</TABLE>
See Notes to Financial Statements
7
<PAGE> 9
PORTFOLIO OF INVESTMENTS (CONTINUED)
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Par
Amount
(000) Description Coupon Maturity Market Value
- --------------------------------------------------------------------------------------------------
<C> <S> <C> <C> <C>
NEW YORK (CONTINUED)
$ 2,210 Rensselaer, NY Hsg Auth Multi-Family Rev Mtg Van
Rensselaer Heights Ser A........................ 7.750% 01/01/11 $ 2,390,579
1,825 Syracuse, NY Ctfs Partn Syracuse Hancock Intl
Arpt............................................ 6.625 01/01/12 1,923,076
------------
143,819,254
------------
GUAM 3.9%
2,000 Guam Arpt Auth Rev Ser B........................ 6.400 10/01/05 2,040,900
3,000 Guam Govt Ltd Oblig Hwy Ser A (FSA Insd)........ 6.250 05/01/07 3,187,020
1,000 Guam Pwr Auth Rev Ser A......................... 6.625 10/01/14 1,039,670
------------
6,267,590
------------
PUERTO RICO 5.5%
5,000 Puerto Rico Comwlth Hwy & Tran Ser Y (Embedded
Cap) (FSA Insd)................................. 5.730 07/01/21 5,381,300
2,250 Puerto Rico Comwlth Pub Impt (Prerefunded @
07/01/02)....................................... 6.800 07/01/21 2,490,435
1,000 Puerto Rico Pub Bldgs Auth Rev Gtd Ser K
(Prerefunded @ 07/01/02)........................ 6.875 07/01/21 1,110,260
------------
8,981,995
------------
TOTAL LONG-TERM INVESTMENTS 98.2%
(Cost $149,226,224)(a)...................................................... 159,068,839
SHORT-TERM INVESTMENTS 0.2%
(Cost $400,000)(a).......................................................... 400,000
OTHER ASSETS IN EXCESS OF LIABILITIES 1.6%................................... 2,562,164
------------
NET ASSETS 100.0%............................................................ $162,031,003
============
</TABLE>
*Zero coupon bond
(a) At April 30, 1997, for federal income tax purposes, cost for long- and
short-term investments is $149,626,224; the aggregate gross unrealized
appreciation is $9,921,048 and the aggregate gross unrealized depreciation
is $78,433, resulting in net unrealized appreciation of $9,842,615.
See Notes to Financial Statements
8
<PAGE> 10
STATEMENT OF ASSETS AND LIABILITIES
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Long-Term Investments, at Market Value (Cost $149,226,224)
(Note 1).................................................. $159,068,839
Short-Term Investments (Cost $400,000) (Note 1)............. 400,000
Cash........................................................ 587,172
Interest Receivable......................................... 2,324,139
Other....................................................... 2,421
------------
Total Assets.......................................... 162,382,571
------------
LIABILITIES:
Payables:
Income Distributions--Common and Preferred Shares......... 88,255
Investment Advisory Fee (Note 2).......................... 86,089
Administrative Fee (Note 2)............................... 26,489
Affiliates (Note 2)....................................... 5,081
Accrued Expenses............................................ 85,177
Deferred Compensation and Retirement Plans (Note 2)......... 60,477
------------
Total Liabilities..................................... 351,568
------------
NET ASSETS.................................................. $162,031,003
============
NET ASSETS CONSIST OF:
Preferred Shares ($.01 par value, authorized 100,000,000
shares, 1,200 issued with liquidation preference of
$50,000 per share) (Note 5)............................... $ 60,000,000
------------
Common Shares ($.01 par value with an unlimited number of
shares authorized, 6,200,987 shares issued and
outstanding).............................................. 62,010
Paid in Surplus............................................. 91,232,016
Net Unrealized Appreciation on Investments.................. 9,842,615
Accumulated Undistributed Net Investment Income............. 749,902
Accumulated Net Realized Gain on Investments................ 144,460
------------
Net Assets Applicable to Common Shares................ 102,031,003
------------
NET ASSETS.................................................. $162,031,003
============
NET ASSET VALUE PER COMMON SHARE ($102,031,003 divided
by 6,200,987 shares outstanding).......................... $ 16.45
============
</TABLE>
See Notes to Financial Statements
9
<PAGE> 11
STATEMENT OF OPERATIONS
For the Six Months Ended April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
INVESTMENT INCOME:
Interest.................................................... $ 4,778,894
-----------
EXPENSES:
Investment Advisory Fee (Note 2)............................ 525,485
Administrative Fee (Note 2)................................. 161,688
Preferred Share Maintenance (Note 5)........................ 80,964
Custody..................................................... 15,331
Trustees Fees and Expenses (Note 2)......................... 12,805
Legal (Note 2).............................................. 7,240
Amortization of Organizational Costs (Note 1)............... 2,001
Other....................................................... 74,485
-----------
Total Expenses.......................................... 879,999
-----------
NET INVESTMENT INCOME....................................... $ 3,898,895
===========
REALIZED AND UNREALIZED GAIN/LOSS ON INVESTMENTS:
Net Realized Gain on Investments............................ $ 144,460
-----------
Unrealized Appreciation/Depreciation on Investments:
Beginning of the Period................................... 10,942,209
End of the Period......................................... 9,842,615
-----------
Net Unrealized Depreciation on Investments During the
Period.................................................... (1,099,594)
-----------
NET REALIZED AND UNREALIZED LOSS ON INVESTMENTS............. $ (955,134)
===========
NET INCREASE IN NET ASSETS FROM OPERATIONS.................. $ 2,943,761
===========
</TABLE>
See Notes to Financial Statements
10
<PAGE> 12
STATEMENT OF CHANGES IN NET ASSETS
For the Six Months Ended April 30, 1997
and the Year Ended October 31, 1996 (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Six Months Ended Year Ended
April 30, 1997 October 31, 1996
- --------------------------------------------------------------------------------------------
<S> <C> <C>
FROM INVESTMENT ACTIVITIES:
Operations:
Net Investment Income................................... $ 3,898,895 $ 8,071,755
Net Realized Gain on Investments........................ 144,460 339,887
Net Unrealized Appreciation/Depreciation on
Investments During the Period......................... (1,099,594) 265,699
------------ ------------
Change in Net Assets from Operations.................... 2,943,761 8,677,341
------------ ------------
Distributions from Net Investment Income:
Common Shares......................................... (2,790,263) (5,580,709)
Preferred Shares...................................... (1,002,107) (2,179,733)
------------ ------------
(3,792,370) (7,760,442)
------------ ------------
Distributions from Net Realized Gain on Investments
(Note 1):
Common Shares......................................... (200,265) -0-
Preferred Shares...................................... (73,239) -0-
------------ ------------
(273,504) -0-
------------ ------------
Total Distributions..................................... (4,065,874) (7,760,442)
------------ ------------
NET CHANGE IN NET ASSETS FROM INVESTMENT ACTIVITIES..... (1,122,113) 916,899
NET ASSETS:
Beginning of the Period................................. 163,153,116 162,236,217
------------ ------------
End of the Period (Including accumulated undistributed
net investment income of $749,902 and $643,377,
respectively)......................................... $162,031,003 $163,153,116
============ ============
</TABLE>
See Notes to Financial Statements
11
<PAGE> 13
FINANCIAL HIGHLIGHTS
The following schedule presents financial highlights for one common share of
the Trust outstanding throughout the periods indicated. (Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION> March 27, 1992
Six Months (Commencement
Ended Year Ended October 31, of Investment
April 30, ------------------------------------- Operations) to
1997 1996 1995 1994 1993 October 31, 1992
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of the Period (a)...... $16.634 $16.487 $14.801 $17.621 $14.812 $14.742
------- ------- ------- ------- ------- -------
Net Investment Income............ .629 1.302 1.303 1.337 1.352 .607
Net Realized and Unrealized
Gain/Loss on Investments....... (.153) .097 1.783 (2.869) 2.766 .027
------- ------- ------- ------- ------- -------
Total from Investment
Operations....................... .476 1.399 3.086 (1.532) 4.118 .634
------- ------- ------- ------- ------- -------
Less:
Distributions from Net Investment
Income:
Paid to Common Shareholders.... .450 .900 1.000 1.020 1.020 .425
Common Share Equivalent of
Distributions Paid to
Preferred Shareholders....... .162 .352 .384 .268 .289 .139
Distributions from Net Realized
Gain on Investments (Note 1):
Paid to Common Shareholders.... .032 -0- .013 -0- -0- -0-
Common Share Equivalent of
Distributions Paid to
Preferred Shareholders....... .012 -0- .003 -0- -0- -0-
------- ------- ------- ------- ------- -------
Total Distributions............... .656 1.252 1.400 1.288 1.309 .564
------- ------- ------- ------- ------- -------
Net Asset Value, End of the
Period........................... $16.454 $16.634 $16.487 $14.801 $17.621 $14.812
======= ======= ======= ======= ======= =======
Market Price Per Share at End of
the Period....................... $14.500 $14.625 $14.375 $13.125 $17.125 $15.000
Total Investment Return at Market
Price (b)........................ 2.41%* 8.09% 17.49% (18.07%) 21.52% 2.79%*
Total Return at Net Asset Value
(c).............................. 1.82%* 6.50% 18.88% (10.55%) 26.50% 1.48%*
Net Assets at End of the Period
(In millions).................... $162.0 $163.2 $162.2 $151.8 $169.3 $151.8
Ratio of Expenses to Average Net
Assets Applicable to Common
Shares (d)....................... 1.72% 1.73% 1.78% 1.70% 1.62% 1.49%**
Ratio of Expenses to Average Net
Assets (d)....................... 1.09% 1.09% 1.10% 1.07% 1.02% 1.03%**
Ratio of Net Investment Income to
Average Net Assets Applicable to
Common Shares (e)................ 5.67% 5.67% 5.89% 6.55% 6.45% 5.28%**
Portfolio Turnover................ 3%* 20% 54% 38% 18% 24%*
</TABLE>
(a) Net Asset Value at March 27, 1992 is adjusted for common and preferred share
offering costs of $.258 per common share.
(b) Total Investment Return at Market Price reflects the change in market value
of the common shares for the period indicated with reinvestment of dividends
in accordance with the Trust's dividend reinvestment plan.
(c) Total Return at Net Asset Value (NAV) reflects the change in value of the
Trust's assets with reinvestment of dividends based upon NAV.
(d) Beginning with the year ended October 31, 1995, the Ratios of Expenses are
based upon Total Expenses which does not reflect credits earned on overnight
cash balances.
(e) Net Investment Income is adjusted for the common share equivalent of
distributions paid to preferred shareholders.
* Non-Annualized
** If certain expenses had not been assumed by the investment adviser for the
period ended October 31, 1992, the annualized ratios of expenses to average
net assets applicable to common shares, expenses to average net assets and
net investment income to average net assets applicable to common shares would
have been 1.58%, 1.10% and 5.19%, respectively.
See Notes to Financial Statements
12
<PAGE> 14
NOTES TO FINANCIAL STATEMENTS
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES
Van Kampen American Capital Trust for Investment Grade New York Municipals (the
"Trust") is registered as a non-diversified closed-end management investment
company under the Investment Company Act of 1940, as amended. The Trust's
investment objective is to provide a high level of current income exempt from
federal as well as New York State and New York City income taxes, consistent
with preservation of capital. The Trust will invest substantially all of its
assets in New York municipal securities rated investment grade at the time of
investment. The Trust commenced investment operations on March 27, 1992.
The following is a summary of significant accounting policies consistently
followed by the Trust in the preparation of its financial statements. The
preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
A. SECURITY VALUATION--Investments are stated at value using market quotations
or, if such valuations are not available, estimates obtained from yield data
relating to instruments or securities with similar characteristics in accordance
with procedures established in good faith by the Board of Trustees. Short-term
securities with remaining maturities of 60 days or less are valued at amortized
cost.
B. SECURITY TRANSACTIONS--Security transactions are recorded on a trade date
basis. Realized gains and losses are determined on an identified cost basis. The
Trust may purchase and sell securities on a "when issued" or "delayed delivery"
basis, with settlement to occur at a later date. The value of the security so
purchased is subject to market fluctuations during this period. The Trust will
maintain, in a segregated account with its custodian, assets having an aggregate
value at least equal to the amount of the when issued or delayed delivery
purchase commitments until payment is made. At April 30, 1997, there were no
when issued or delayed delivery purchase commitments.
C. INVESTMENT INCOME--Interest income is recorded on an accrual basis. Bond
premium and original issue discount are amortized over the expected life of each
applicable security.
13
<PAGE> 15
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
D. ORGANIZATIONAL COSTS--The Trust has reimbursed Van Kampen American Capital
Distributors, Inc. or its affiliates (collectively "VKAC") for costs incurred in
connection with the Trust's organization in the amount of $25,000. These costs
were amortized on a straight line basis over the 60 month period ended March 26,
1997.
E. FEDERAL INCOME TAXES--It is the Trust's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute substantially all of its taxable income to its
shareholders. Therefore, no provision for federal income taxes is required.
F. DISTRIBUTION OF INCOME AND GAINS--The Trust declares and pays dividends from
net investment income to common shareholders monthly. Net realized gains, if
any, are distributed annually on a pro rata basis to common and preferred
shareholders. Distributions from net realized gains for book purposes may
include short-term capital gains, which are included as ordinary income for tax
purposes.
2. INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES
Under the terms of the Trust's Investment Advisory Agreement, the Adviser will
provide investment advice and facilities to the Trust for an annual fee payable
monthly of .65% of the average net assets of the Trust. In addition, the Trust
will pay a monthly administrative fee to VKAC, the Trust's Administrator, at an
annual rate of .20% of the average daily net assets of the Trust. The
administrative services provided by the Administrator include record keeping and
reporting responsibilities with respect to the Trust's portfolio and preferred
shares and providing certain services to shareholders.
Certain legal expenses are paid to Skadden, Arps, Slate, Meagher & Flom
(Illinois), counsel to the Trust, of which a trustee of the Trust is an
affiliated person.
For the six months ended April 30, 1997, the Trust recognized expenses of
approximately $20,900 representing VKAC's cost of providing accounting and legal
services to the Trust.
Certain officers and trustees of the Trust are also officers and directors
of VKAC. The Trust does not compensate its officers or trustees who are officers
of VKAC.
The Trust provides deferred compensation and retirement plans for its
trustees who are not officers of VKAC. Under the deferred compensation plan,
trustees may elect to defer all or a portion of their compensation to a later
date. Benefits under the retirement plan are payable for a ten-year period and
are based upon each trustee's years of service
14
<PAGE> 16
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
to the Trust. The maximum annual benefit under the plan is equal to the
trustees' annual retainer fee, which is currently $2,500.
At April 30, 1997, VKAC owned 6,700 common shares of the Trust.
3. INVESTMENT TRANSACTIONS
During the period, the cost of purchases and proceeds from sale of investments,
excluding short-term investments, were $4,678,017 and $6,444,130, respectively.
4. DERIVATIVE FINANCIAL INSTRUMENTS
A derivative financial instrument in very general terms refers to a security
whose value is "derived" from the value of an underlying asset, reference rate
or index.
The Trust uses Indexed Securities, a type of derivative instrument, as a
hedge against a rise in short-term interest rates which are paid on the Trust's
preferred shares. All of the Trust's portfolio holdings, including derivative
instruments, are marked to market each day with the change in value reflected in
the unrealized appreciation/depreciation on investments. Upon disposition, a
realized gain or loss is recognized accordingly.
The following types of Indexed Securities are identified in the portfolio of
investments. The price of these securities may be more volatile than the price
of a comparable fixed rate security.
A. An Embedded Cap security includes a cap strike level such that the coupon
payment may be supplemented by cap payments if the floating rate index upon
which the cap is based rises above the strike level.
B. An Embedded Swap security includes a swap component such that the fixed
coupon component of the underlying bond is adjusted by the difference between
the security's fixed swap rate and the floating swap index.
15
<PAGE> 17
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
April 30, 1997 (Unaudited)
- --------------------------------------------------------------------------------
5. PREFERRED SHARES
The Trust has outstanding 1,200 Auction Preferred Shares ("APS"). Dividends are
cumulative and the dividend rate is currently reset every 28 days through an
auction process. The rate in effect on April 30, 1997, was 3.67%. During the six
months ended April 30, 1997, the rates ranged from 3.36% to 4.26%.
The Trust pays annual fees equivalent to .25% of the preferred share
liquidation value for the remarketing efforts associated with the preferred
auctions. These fees are included as a component of Preferred Share Maintenance
expense.
The APS are redeemable at the option of the Trust in whole or in part at the
liquidation value of $50,000 per share plus accumulated and unpaid dividends.
The Trust is subject to certain asset coverage tests and the APS are subject to
mandatory redemption if the tests are not met.
16
<PAGE> 18
VAN KAMPEN AMERICAN CAPITAL TRUST FOR INVESTMENT GRADE NEW YORK MUNICIPALS
BOARD OF TRUSTEES
DAVID C. ARCH
ROD DAMMEYER
HOWARD J KERR
DENNIS J. MCDONNELL*--Chairman
THEODORE A. MYERS
HUGO F. SONNENSCHEIN
WAYNE W. WHALEN*
OFFICERS
DENNIS J. MCDONNELL*
President
RONALD A. NYBERG*
Vice President and Secretary
EDWARD C. WOOD, III*
Vice President and Chief Financial Officer
CURTIS W. MORELL*
Vice President and Chief Accounting Officer
JOHN L. SULLIVAN*
Treasurer
TANYA M. LODEN*
Controller
PETER W. HEGEL*
Vice President
INVESTMENT ADVISER
VAN KAMPEN AMERICAN CAPITAL
INVESTMENT ADVISORY CORP.
One Parkview Plaza
Oakbrook Terrace, Illinois 60181
CUSTODIAN AND
TRANSFER AGENT
STATE STREET BANK
AND TRUST COMPANY
225 Franklin Street
P.O. Box 1713
Boston, Massachusetts 02105
LEGAL COUNSEL
SKADDEN, ARPS, SLATE,
MEAGHER & FLOM (ILLINOIS)
333 West Wacker Drive
Chicago, Illinois 60606
INDEPENDENT ACCOUNTANTS
KPMG PEAT MARWICK LLP
Peat Marwick Plaza
303 East Wacker Drive
Chicago, Illinois 60601
* "Interested" persons of the Trust, as defined in the Investment Company Act
of 1940.
(C) Van Kampen American Capital Distributors, Inc., 1997 All rights reserved.
(SM) denotes a service mark of Van Kampen American Capital Distributors, Inc.
17
