BLACKROCK INVESTMENT QUALITY TERM TRUST INC, N-30D, 2000-03-01

BLACKROCK INVESTMENT QUALITY TERM TRUST INC
N-30D, 2000-03-01

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THE BLACKROCK INVESTMENT QUALITY TERM TRUST INC.
ANNUAL REPORT TO SHAREHOLDERS
REPORT OF INVESTMENT ADVISOR
- --------------------------------------------------------------------------------

January 31, 2000

Dear Shareholder:
After easing monetary policy three times during the fourth quarter of
1998, the Federal Reserve reversed its trend by raising the Fed funds target
rate 75 basis points (to 5.50%) over the course of 1999 in response to robust
GDP, low unemployment and rising equity prices. U.S. Treasury yields rose
significantly during the past twelve months, with the yield of the 30-year
Treasury rising above 6.00% for the first time since May 1998.

Despite the rise in Treasury yields, continued strong economic growth may
spur the Federal Reserve to proactively fight perceived inflation through
continued monetary policy tightening in 2000. Until the inflation picture
becomes clearer, we expect interest rates to remain largely range-bound.
Accordingly, we will continue to seek the most attractive relative value
opportunities and utilize our proprietary risk management systems to help the
Trust to achieve its investment objectives.

This report contains a summary of market conditions during the annual
period and a review of portfolio strategy by your Trust's managers in addition
to the Trust's audited financial statements and a detailed portfolio list of the
portfolio's holdings. Continued thanks for your confidence in BlackRock. We
appreciate the opportunity to help you achieve your long-term investment goals.

Sincerely,

/s/ LAURENCE D. FINK /s/ RALPH L. SCHLOSSTEIN
- -------------------- ------------------------
Laurence D. Fink Ralph L. Schlosstein
Chairman President

<PAGE>
January 31, 2000

Dear Shareholder:
We are pleased to present the annual report for The BlackRock Investment
Quality Term Trust Inc. ("the Trust") for the year ended December 31, 1999. We
would like to take this opportunity to review the Trust's stock price and net
asset value (NAV) performance, summarize market developments and discuss recent
portfolio management activity.
The Trust is a diversified, actively managed closed-end bond fund whose
shares are traded on the New York Stock Exchange under the symbol "BQT". The
Trust's primary investment objective is to return $10 per share (its initial
offering price) to shareholders on or about December 31, 2004. Although there
can be no guarantee, BlackRock believes that the Trust can achieve its
investment objective. The Trust will seek to achieve its objective by investing
in investment grade fixed income securities, including corporate debt
securities, mortgage-backed securities backed by U.S. Government agencies (such
as Fannie Mae, Freddie Mac or Ginnie Mae), asset-backed securities and
commercial mortgage-backed securities. All of the Trust's assets must be rated
at least "BBB" by Standard & Poor's or "Baa" by Moody's at time of purchase or
be issued or guaranteed by the U.S. Government or its agencies.
The table below summarizes the performance of the Trust's stock price and NAV
(the market value of its assets per share) over the period:

12/31/99 12/31/98 CHANGE HIGH LOW
-------- -------- -------- ------ -------
STOCK PRICE $7.875 $8.8125 (10.64)% $9.00 $7.8125
NET ASSET VALUE (NAV) $8.79 $9.56 (8.05)% $9.68 $8.79
10-YEAR TREASURY NOTE 6.44% 4.65% 38.49% 6.44% 4.61%

THE FIXED INCOME MARKETS

Despite the complete reversal of last year's 0.75% easing by the Federal
Reserve, the expansion of the U.S. economy continues intact. At the end of 1999,
the labor markets remain tight, economic growth remains strong and inflation
pressures appear restrained by offsetting gains in productivity. However, the
factors that should eventually lead to higher interest rates also remain intact:
higher equity and commodity prices, a confident consumer, labor markets that
continue to tighten and a global recovery that will boost U.S. exports and
reduce the trade deficit. Along with consumer confidence, consumer credit
continues to advance as evidenced in remarkably strong holiday sales.
Although the Federal Open Market Committee took no action at their December
meeting, this should not be interpreted to mean that the threat of inflationary
forces has dissipated. We expect that continued above-trend economic strength,
tight labor markets and the need to drain the excess liquidity that the Fed
provided the financial markets in the months leading up to Y2K will warrant
additional Fed tightening in 2000. Despite our outlook for additional Fed moves
we believe that the market has adequately priced in the degree of tightening
necessary to successfully engineer an economic slow down later this year.
Treasury yields increased significantly during 1999, continuing their
year-long slide in price. Over the course of the year the yield of the 30-year
Treasury has increased by nearly 139 basis points (1.39%). The yield of the
10-Year Treasury posted a net increase of 179 basis points (1.79%), beginning
1999 at 4.65% and closing on December 31, 1999 at 6.44%. Bond prices, which move
inversely to their yields, have continued to be punished as the market reacted
to strength of the economy and uncertainty of future Fed action. During the
fourth quarter, the short and intermediate sections of the yield curve
underperformed the long end of the curve. As we move into 2000, we anticipate a
continued flattening of the yield curve as a result of an active Federal Reserve
and potential Treasury repurchases of long maturity debt.

2
<PAGE>

A combination of shrinking supply, and a decline in prepayment rates in
response to a reduction in refinancing activity, allowed mortgage securities to
outperform the broader investment grade market. Falling bond prices kept
mortgages rates near 8%, which has significantly affected refinancing activity
reducing an important source of new mortgage origination. For the period ending
December 31st the LEHMAN BROTHERS MORTGAGE INDEX, mortgages posted a 1.86% total
return versus -0.82% for the LEHMAN BROTHERS AGGREGATE INDEX. As the origination
of new mortgages continues to decline, the outlook for the mortgage sector is
favorable. Despite the rich valuations of mortgages, a likely shortage of
yield-oriented products will draw investors to the mortgage sector as they
execute their investment plans in 2000.
Investment grade corporate securities underperformed the broader investment
grade bond market, as corporates measured by the MERRILL LYNCH U.S. CORPORATE
MASTER INDEX returned -1.87%, as compared to the LEHMAN BROTHERS AGGREGATE
INDEX'S -0.82%. 1999 was marked by a large supply of corporate bonds due to M&A
activity and issuers rushing to market ahead of Y2K. While we believe M&A
activity will follow through in 2000, higher rates combined with the increased
issuance in 1999 should result in a more moderate supply picture in 2000.
Despite a very buoyant economic environment, credit parameters have not been
improving in the investment grade corporate bond universe raising concerns about
vulnerability to a down turn. As a result, we have generally implemented an "up
in credit" strategy in portfolios.

THE TRUST'S PORTFOLIO AND INVESTMENT STRATEGY

BlackRock actively manages the Trust's portfolio holdings consistent with
BlackRock's overall market outlook and the Trust's investment objectives. The
following chart compares the Trust's current and December 31, 1998 asset
composition.

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THE BLACKROCK INVESTMENT QUALITY TERM TRUST INC.
- --------------------------------------------------------------------------------
COMPOSITION DECEMBER 31, 1999 DECEMBER 31, 1998
- --------------------------------------------------------------------------------
Corporate Bonds 27% 29%
- --------------------------------------------------------------------------------
Mortgage Pass-Throughs 20% 19%
- --------------------------------------------------------------------------------
U.S. Government Securities 11% 8%
- --------------------------------------------------------------------------------
Interest-Only Mortgage-Backed Securities 8% 11%
- --------------------------------------------------------------------------------
Commercial Mortgage-BackedSecurities 6% 7%
- --------------------------------------------------------------------------------
Stripped Money Market Instruments 6% 6%
- --------------------------------------------------------------------------------
Agency Multiple Class Mortgage Pass-Throughs 5% 6%
- --------------------------------------------------------------------------------
Taxable Municipal Bonds 5% 5%
- --------------------------------------------------------------------------------
Adjustable & Inverse Floating Rate Mortgages 5% 5%
- --------------------------------------------------------------------------------
Asset-Backed Securities 3% 2%
- --------------------------------------------------------------------------------
Principal-Only Mortgage-Backed Securities 2% 2%
- --------------------------------------------------------------------------------
Non-Agency Multiple Class Mortgage Pass-Throughs 2% --
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
RATING % OF CORPORATES
- --------------------------------------------------------------------------------
CREDIT RATING DECEMBER 31, 1999 DECEMBER 31, 1998
- --------------------------------------------------------------------------------
AA or equivalent 4% --
- --------------------------------------------------------------------------------
A or equivalent 44% 48%
- --------------------------------------------------------------------------------
BBB or equivalent 46% 46%
- --------------------------------------------------------------------------------
BB or equivalent 6% 6%
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3
<PAGE>

In accordance with the Trust's primary investment objective of returning the
initial offer price upon maturity, the Trust's portfolio management activity
focused on adding securities which offer attractive yield spreads over Treasury
securities and an emphasis on bonds with maturity dates approximating the
Trust's termination date of December 31, 2004. Additionally, the Trust has been
active in reducing positions in bonds which have maturity dates or potential
cash flows after the Trust's termination date.
Consistent with the Trust's primary investment objective, the continual
reinvestment of cash flows into shorter maturity securities over time as the
Trust approaches its maturity date results in a natural reduction in the amount
of net investment income generated by the Trust. Therefore, after careful
evaluation of the current and anticipated level of the Trust's net investment
income, the Board of Directors voted to reduce the Trust's monthly dividend from
$0.04167 ($0.50 annualized) to $0.0375 ($0.45 annualized) effective with the
December 31, 1999 dividend payment.
During the reporting period, the most significant additions have been in the
U.S. Government Securities, and mortgage pass-throughs. Additionally, the Trust
maintained its significant weighting in investment grade corporate bonds and
well-structured mortgage securities. To finance these purchases, the Trust sold
commercial mortgage-backed securities, as their maturity may extend past the
Trust's termination date in a rising interest rate environment, and interest
only mortgage-backed securities. The Trust also took some profits in the
corporate bond sector.
As a result of an internal reorganization, effective January 1, 2000,
BlackRock Advisors, Inc. has replaced BlackRock Financial Management Inc., a
wholly-owned subsidiary of BlackRock Advisors, Inc. as the Advisor of the Trust.
The investment management and other personnel responsible for providing services
to the Trust did not change as a result of the reorganization. We look forward
to managing the Trust to benefit from the opportunities available in the fixed
income markets and to meet its investment objectives. We thank you for your
investment in The BlackRock Investment Quality Term Trust Inc. Please feel free
to contact our marketing center at (800) 227-7BFM (7236) if you have specific
questions which were not addressed in this report.

Sincerely,

/s/ ROBERT S. KAPITO /s/ MICHAEL P. LUSTIG
- -------------------- ---------------------
Robert S. Kapito Michael P. Lustig
Vice Chairman and Portfolio Manager Managing Director and Portfolio Manager
BlackRock Advisors, Inc. BlackRock Advisors, Inc.

(1) Yield on Closing Stock Price is calculated by dividing the current
annualized distribution per share by the closing stock price per share.

(2) The distribution is not constant and is subject to change.

<PAGE>
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THE BLACKROCK INVESTMENT QUALITY TERM TRUST INC.
PORTFOLIO OF INVESTMENTS
DECEMBER 31, 1999

================================================================================
PRINCIPAL
RATING* AMOUNT VALUE
(UNAUDITED) (000) DESCRIPTION (NOTE 1)
- --------------------------------------------------------------------------------
LONG-TERM INVESTMENTS--136.9%
MORTGAGE PASS-THROUGHS--27.9%
Federal Home Loan Mortgage Corp.,
$14,541@ 6.50%, 5/01/26 - 6/01/29 .................. $ 13,709,335
7,109@ 7.00%, 12/01/28 ........................... 6,879,753
Federal Housing Administration,
2,055 Colonial, Series 37,
7.40%, 12/01/22 ........................... 2,041,549
4,616 GMAC, Series 51,
7.43%, 2/01/21 ............................ 4,607,007
1,242 Middlesex, 8.625%, 9/01/34 ................ 1,251,925
2,832 Tuttle Grove, 7.25%, 10/01/35 ............. 2,723,657
USGI,
1,179 Series 99, 7.43%, 10/01/23 .............. 1,169,759
7,920 Series 885, 7.43%, 3/01/22 .............. 7,865,687
4,097 Series 2081, 7.43%, 5/01/23 ............. 4,071,121
Federal National Mortgage Association,
32,132@ 6.50%, 8/01/28 - 6/01/29 .................. 30,274,169
9,320@ 6.35%, 1/01/04,
10 Year, Multi-family ................... 9,104,098
2,754@ 8.26%, 2/01/04,
10 Year, Multi-family ................... 2,787,668
2,294@ 8.78%, 4/01/04,
10 Year, Multi-family ................... 2,330,918
1,535@ 8.89%, 4/01/04,
10 Year, Multi-family ................... 1,559,248
-----------
90,375,894
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AGENCY MULTIPLE CLASS MORTGAGE
PASS-THROUGHS--6.7%
Federal Home Loan Mortgage Corp.,
Multiclass Mortgage Participation
Certificates,
484 Series 1512, Class 1512-NB,
5/15/08 ................................. 463,279
11 Series 1523, Class 1523-A,
6/15/22 ................................. 10,942
2,439 Series 1565, Class 1565-0A,
8/15/08 ................................. 2,323,612
1,037 Series 1584, Class 1584-SE,
2/15/23 ................................. 756,727
4,000@ Series 1587, Class 1587-KA,
7/15/08 ................................. 3,916,160
26 Series 1607, Class 1607-M,
4/15/13 ................................. 25,571
120 Series 1650, Class 1650-LC,
2/15/22 ................................. 119,458
2,728 Series 1667, Class 1667-C,
1/15/09 ................................. 2,632,531
1,651 Series 1678, Class 1678-SA,
2/15/09 ................................. 1,546,186

Federal National Mortgage Association,
REMIC Pass-Through Certificates,
$ 1,270 Trust 269, Class 269-1,
8/01/22 ................................. $ 1,325,324
6,338 Trust 1992-43, Class 43-E,
4/25/22 ................................. 6,303,045
257 Trust 1994-36, Class 36-L,
1/25/23 ................................. 255,001
2,000@ Trust 1996-M5, Class A2,
1/25/11 ................................. 1,990,714
-----------
21,668,550
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NON-AGENCY MULTIPLE CLASS
MORTGAGE PASS-THROUGHS--2.8%
Aaa 3,750 Chase Mortgage Finance Corp.,
Series 1993, Class A-9,
12/25/09 ................................ 3,710,138
AAA 1,031 GE Capital Mortgage Services Inc.,
Series 1994-2, Class A-4,
1/25/09 ................................. 1,021,124
AAA 4,271 Norwest Asset Securitization Corp.,
Series 1997-9, Class A-2,
7/25/12 ................................ 4,253,676
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8,984,938
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ADJUSTABLE & INVERSE FLOATING
RATE MORTGAGES--6.9%
Federal Home Loan Mortgage Corp.,
Multiclass Mortgage Participation
Certificates,
12,122@ Series 1353, Class 1353-S,
8/15/07 ................................ 1,103,589
15 Series 1634, Class 1634-SG,
12/15/22 ................................ 13,938
463 Series 1655, Class 1655-SB,
12/15/08 ................................ 439,219
Federal National Mortgage Association,
REMIC Pass-Through Certificates,
1,646@ Trust 1992-155, Class 155-SB,
2/25/06 ................................. 1,511,818
1,500 Trust 1993-143, Class 1993-SC,
8/25/23 ................................. 1,340,715
186 Trust 1993-179, Class 179-SA,
10/25/23 ................................ 178,455
8,162@ Trust 1993-188, Class 188-S,
2/25/08 ................................. 7,795,164
105 Trust 1993-192, Class 192-S,
4/25/07 ................................. 104,042

See Notes to Financial Statements.

5
<PAGE>

ADJUSTABLE & INVERSE FLOATING
RATE MORTGAGES(CONTINUED)
Federal National Mortgage Association,
REMIC Pass-Through Certificates,
$ 1,408 Trust 1993-212, Class 212-SB,
11/25/08 ................................ $ 1,366,928
705@ Trust 1993-225, Class 225-FK,
12/25/23 ................................ 700,147
189 Trust 1994-17, Class 17-SA,
1/25/09 ................................. 184,907
7,000@ Trust 1996-20, Class 20-SB,
10/25/08 ................................ 1,720,469
Residential Funding Mortgage
Securities I,
AAA 5,132 Series 1993-S15, Class A-16,
4/25/08 ................................. 5,269,902
AAA 529 Series 1993-S15, Class A-17,
4/25/08 ................................. 508,756
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22,238,049
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INTEREST ONLY MORTGAGE-BACKED
SECURITIES--10.5%
AAA 120,461 Citicorp Mortgage Securities Inc.,
REMIC Pass-Through Certificates,
Series 1999-3, Class A3,
5/25/29 ............................... 1,543,412
AAA 39,763 Credit Suisse First Boston
Mortgage Securities Corp.,
Series 1997-C1, Class AX,
6/20/29** ............................... 3,277,699
AAA 1,405 CWMBS Inc., Mortgage Certificate,
Series 1994-D, Class A-7,
3/25/24 ................................. 1,382,518
Federal Home Loan Mortgage Corp.,
Multiclass Mortgage Participation
Certificates,
6,546 Series G-25, Class 25-S,
8/25/06 ................................. 105,064
1,243 Series 1489, Class 1489-K,
10/15/07 ................................ 97,960
23,335 Series 1644, Class 1644-DA,
12/15/23 ................................ 583,364
789 Series 1751, Class 1751-PL,
10/15/23 ................................ 99,064
3,416 Series 1917, Class 1917-AS,
5/15/08 ................................. 620,789
831 Series 1946, Class 1946-SN,
10/15/08 ................................ 136,116
26,038 Series 1954, Class 1954-BB,
4/15/21 ................................. 207,784
11,282 Series 1954, Class 1954-LL,
5/15/21 ................................. 92,285
11,282 Series 1954, Class 1954-LM,
5/15/21 ................................. 92,285
14,577 Series 2055, Class 2055-IB,
12/15/09 ................................ 2,430,728
1,938 Series 2144, Class 2144-GI,
12/15/07 ................................ 177,204
Federal National Mortgage Association,
REMIC Pass-Through Certificates,
440 Trust 1993-22, Class 22-PT,
10/25/18 ................................ 8,217
1,463 Trust 1993-39, Class 39-K,
4/25/04 ................................. 210,605
9,600 Trust 1993-109, Class 109-QC,
7/25/07 ................................. 717,060
1,344 Trust 1994-27, Class 27-WC,
3/25/20 ................................. 115,204
2,175 Trust 1994-42, Class 42-SO,
3/25/23 ................................. 222,882
4,128 Trust 1996-24, Class 24-SE,
3/25/09 ................................. 837,919
108 Trust 1997-7, Class 7-WC,
4/25/22 ................................. 5,288
923 Trust 1997-28, Class 28-PH,
3/18/22 ................................. 86,731
15,402 Trust 1997-44, Class 44-SC,
6/25/08 ................................. 896,338
6,250 Trust 1997-50, Class 50-HK,
8/25/27 ................................. 1,966,974
8,908 Trust 1998-8, Class 8-PM,
6/18/19 ................................. 962,276
1,876 Trust 1998-12, Class 12-PL,
7/18/19 ................................. 205,371
15,220 Trust 1998-27, Class 27-PI,
12/18/20 ................................ 2,120,709
5,782 Trust 1999-43, Class 43-PL,
1/25/21 ................................. 890,718
AAA 1,641 GE Capital Mortgage Services Inc.,
Series 1997-2, Class 2-A-4,
3/25/12 ................................. 303,081
Merrill Lynch Mortgage Investors, Inc.,
AAA 71,310 Series 1997-C2, Class IO,
12/10/29 ................................ 4,629,772
AAA 47,653 Series 1998-C2, Class IO,
2/15/30 ................................. 3,411,739
Morgan Stanley Capital 1 Inc.,
AAA 2,934 Series 1997-HF1, Class HF1-X,
6/15/17** ............................... 217,306
AAA 79,826 Series 1998-HF1, Class HF1-X,
2/15/18 ................................. 4,289,593
AAA 5,350 PNC Mortgage Securities Corp.,
Series 1999-5, Class 1A-11,
6/25/29 ................................. 912,866
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33,856,921
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PRINCIPAL ONLY MORTGAGE-BACKED
SECURITIES--2.9%
Federal Home Loan Mortgage Corp.,
Multiclass Mortgage Participation
Certificates,
423 Series 1243, Class 1243-N,
8/15/06 ................................. 381,093

See Notes to Financial Statements.

6
<PAGE>

================================================================================
PRINCIPAL
RATING* AMOUNT VALUE
(UNAUDITED) (000) DESCRIPTION (NOTE 1)
- --------------------------------------------------------------------------------
PRINCIPAL ONLY MORTGAGE-BACKED
SECURITIES(CONTINUED)
Federal Home Loan Mortgage Corp.,
Multiclass Mortgage Participation
Certificates
$ 250 Series 1862, Class 1862-DA,
12/15/22 ................................ $ 165,682
292 Series 1862, Class 1862-DB,
12/15/22 ................................ 193,295
831 Series 1946, Class 1946-N,
10/15/08 ................................ 620,314
847 Series 2009, Class 2009-JH,
11/15/21 ................................ 782,823
Federal National Mortgage Association,
REMIC Pass-Through Certificates,
366@ Trust 1993-147, Class H,
8/25/23 ................................. 250,260
794 Trust 1993-228, Class 228-B,
3/25/23 ................................. 734,621
2,800 Trust 1993-254, Class 254-D,
11/25/23 ................................ 2,121,868
4,454 Trust 1994-57, Class 57-D,
1/15/24 ................................. 3,623,225
692@ Trust 1996-32, Class 32-E,
10/25/08 ................................ 671,048
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9,544,229
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COMMERCIAL MORTGAGE-BACKED
SECURITIES--8.4%
AAA 1,676 AETNA,
Series 1995-C5, Class B,
6.74%, 12/26/30 ......................... 1,668,241
A 6,485 FDIC REMIC Trust,
Series 1994-C1, Class 11-F,
8.70%, 9/25/25 .......................... 6,704,504
Aaa 167 Morgan Stanley Capital 1 Inc.,
Series 1997-HF1, Class A1,
6.86%, 5/15/06** ........................ 164,495
AAA 1,763 Mortgage Capital Funding, Inc.,
Series 1998-MC3, Class A1,
6.00%, 11/18/31 ......................... 1,665,461
AAA 5,000 New York City Mortgage Loan
Trust, Multifamily,
Series 1996, Class A-2,
6.75%, 6/25/11** ........................ 4,692,188
BBB+ 2,600 Nomura Asset Capital Corp.,
Series 1993-M1, Class A3,
7.64%, 11/25/03** ....................... 2,575,333
Structured Asset Securities Corp.,
Mortgage Certificates,
A+ 3,865 Series 1996, Class D,
7.03%, 2/25/28 .......................... 3,874,817
BBB 5,970 Series 1996, Class E,
7.75%, 2/25/28 .......................... 5,867,414
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27,212,453
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ASSET-BACKED SECURITIES--3.4%
NR $ 2,693 Global Rated Eligible Asset Trust,
Series 1998-A, Class A-1**/***
7.33%, 3/15/06 .......................... $ 808,026
AA 4,522 Pegasus Aviation Lease Securitization,
Series 1999-1, Class A-1,
6.30%, 3/25/29** ........................ 4,352,679
Structured Mortgage Asset
Residential Trust@@***
NR 4,077 Series 1997-2,
8.24%, 3/15/06 .......................... 896,997
NR 4,496 Series 1997-3,
8.57%, 4/15/06 .......................... 989,210
4,000 Student Loan Marketing Association,
Series 1995-1, Class B,
6.566%, 10/25/09 ........................ 3,921,875
-----------
10,968,787
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U.S. GOVERNMENT AND AGENCY
SECURITIES--14.9%
Small Business Administration,
1,129 Series 1996-20F,
7.55%, 6/01/16 .......................... 1,123,534
1,664 Series 1996-20G,
7.70%, 7/01/16 .......................... 1,667,667
4,286 Series 1996-20K,
6.95%, 11/01/16 ......................... 4,153,100
1,852 Series 1998-P10, Class P10-A,
6.12%, 2/01/08 .......................... 1,743,310
25,000@ U.S. Treasury Bonds,
5.50%, 8/15/28 ............................ 21,320,250
U.S. Treasury Notes,
12,000@ 4.75%, 2/15/04 ............................ 11,319,360
2,170@ 5.875%, 11/15/04 .......................... 2,127,620
4,800@ 6.00%, 8/15/09 ............................ 4,650,000
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48,104,841
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TAXABLE MUNICIPAL BONDS--6.9%
AAA 3,245 California Housing Finance
Agency Rev.,
6.69%, 8/01/03 .......................... 3,134,313
A+ 2,000 Fresno California Pension
Obligation,
7.15%, 6/01/04 .......................... 1,986,920
AAA 4,000 Los Angeles County California
Pension Obligation,
6.77%, 6/30/05 .......................... 3,891,720
AAA 7,000 New Jersey Economic Development
Authority,
Zero Coupon, 2/15/04 .................... 5,212,970
A- 5,000 New York City, G.O.,
7.50%, 4/15/04 ............................ 4,985,700

See Notes to Financial Statements.

<PAGE>

TAXABLE MUNICIPAL BONDS(CONTINUED)
BBB $ 1,000 New York State Environmental
Facilities Corp., Service
Contract Rev.,
6.95%, 9/15/04 $ 974,860
AAA 2,250 San Francisco California City &
Cnty. Arpts. Commission Rev.,
International Airport,
6.55%, 5/01/04 2,187,720
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22,374,203
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CORPORATE BONDS--36.9%
FINANCE & BANKING--12.9%
A3 2,450@ Amsouth Bancorp.,
6.75%, 11/01/25 ........................... 2,343,768
A+ 1,300 Equitable Life Assurance Society,
6.95%, 12/01/05** ......................... 1,261,147
A+ 5,000@ Farmers Insurance,
8.50%, 8/01/04** .......................... 5,138,375
A 4,800@ First National Bank of Boston,
8.00%, 9/15/04 ............................ 4,900,608
A3 5,000 Fleet Financial Group,
8.125%, 7/01/04 ........................... 5,111,700
A+ 4,850 Goldman Sachs Group,
6.25%, 2/01/03** .......................... 4,708,739
A 3,500 Lehman Brothers Holdings, Inc.,
6.75%, 9/24/01 ............................ 3,473,918
BB- 3,500 Macsaver Financial Services, Inc.,
7.875%, 8/01/03 ........................... 2,065,000
A+ 1,000 Metropolitan Life Insurance Co.,
6.30%, 11/01/03** ......................... 965,440
PaineWebber Group, Inc.,
BBB 500 6.90%, 2/09/04 ............................ 479,118
BBB+ 2,000 8.875%, 3/15/05 ........................... 2,086,059
A 3,100 Reliaster Financial Corp.,
6.625%, 9/15/03 ........................... 2,995,003
Aa3 2,000 Salomon Smith Barney Holdings, Inc.,
6.75%, 1/15/06 ............................ 1,919,000
Xtra, Inc.,
BBB+ 2,000 6.50%, 1/15/04 ............................ 1,892,480
BBB+ 2,500 7.22%, 7/31/04 ............................ 2,407,225
-----------
41,747,580
-----------

INDUSTRIALS--8.9%
A2 400 American Airlines, Inc.,
10.44%, 3/04/07 ........................... 443,756
BBB- 3,600 Anixter Inc.,
8.00%, 9/15/03 ............................ 3,391,021
BBB 2,000 Conagra, Inc.,
7.40%, 9/15/04 ............................ 1,981,180
BB- 5,000 Lukens, Inc.,
7.625%, 8/01/04 ........................... 4,765,750
BBB+ 5,000 Newmont Mining Corp.,
8.00%, 12/01/04 ........................... 4,842,500
BBB- 3,000 News America Holdings, Inc.,
8.50%, 2/15/05 ............................ 3,086,370
BBB 5,000@ Pulte Corp.,
8.375%, 8/15/04 ........................... 4,955,650
A+ 2,000 Ralcorp Holdings, Inc.,
8.75%, 9/15/04 ............................ 2,110,080
AA- 3,000@ TCI Communications, Inc.,
8.25%, 1/15/03 ............................ 3,094,410
-----------
28,670,717
-----------
UTILITIES--5.1%
360 Communications Co.,
A 2,000 7.125%, 3/01/03 ........................... 1,989,820
A 2,000 7.50%, 3/01/06 ............................ 1,996,860
BBB- 5,000 Gulf States Utilities Co.,
8.25%, 4/01/04 ............................ 5,070,700
BBB+ 5,400@ Niagara Mohawk Power Corp.,
7.375%, 8/01/03 ........................... 5,408,640
Baa2 2,000 Ohio Edison Co.,
8.625%, 9/15/03 ........................... 2,080,860
-----------
16,546,880
-----------
YANKEE--10.0%
NR 3,362 Banamex Remittance Master Trust,
Ser. 1996, 7.57%, 1/01/01** ............... 3,345,308
BBB+ 2,000 Canadian Pacific Ltd.,
6.875%, 4/15/03 ........................... 1,952,120
A 2,000 Corporacion Andina de Fomento,
7.10%, 2/01/03 ............................ 1,965,760
A1 3,000 Den Danske Bank,
7.25%, 6/15/05** .......................... 2,944,939
BBB- 5,000 Empresa Electric Guacolda SA,
7.95%, 4/30/03** .......................... 4,750,000
A- 3,500 Israel Electric Corp., Ltd.,
7.25%, 12/15/06** ......................... 3,309,705
A+ 5,000@ Quebec Province,
8.625%, 1/19/05 ........................... 5,246,500
BBB 5,000 Telekom Malaysia Berhad,
7.125%, 8/01/05** ......................... 4,761,600
BBB- 3,000 Telefonica De Argentina SA,
11.875%, 11/01/04 ......................... 3,052,500
BBB- 937 YPF Sociedad Anonima,
7.50%, 10/26/02 ........................... 935,319
-----------
32,263,751
-----------
Total Corporate Bonds ....................... 119,228,928
-----------

STRIPPED MONEY MARKET
INSTRUMENTS--8.7%
40,000 Vanguard Prime Money Market
Portfolio,
Zero Coupon, 12/31/04 ..................... 28,112,000
-----------

See Notes to Financial Statements.

8
<PAGE>

================================================================================
NOTIONAL
AMOUNT VALUE
(000) DESCRIPTION (NOTE 1)
- --------------------------------------------------------------------------------

CALL OPTIONS PURCHASED--0.0%
$50,000 Interest Rate Swap,
5.60% over 3 month LIBOR,
expires 8/07/00 (Cost $687,500) ........... $ 15,388
-----------
Total Long-Term Investments
(cost $459,211,485) ....................... 442,685,181
-----------

PRINCIPAL
AMOUNT
(000)
-------

SHORT-TERM INVESTMENTS--0.8%
DISCOUNT NOTE
$ 2,621 Federal Home Loan Bank,
1.50%, 1/03/00
(amortized cost $2,620,781) ............... 2,620,781
-----------

Total investments before
investments shold short
(cost $461,832,266) ....................... 445,305,962
-----------

INVESTMENT SOLD SHORT--(5.5%)
(18,750) U.S. Treasury Bond,
6.125%, 8/15/29
(proceeds $18,919,824) .................... (17,874,000)
-----------

Total investments net of investments
sold short--132.2%
(cost $442,912,442) ....................... 427,431,962
Liabilities in excess of other
assets--(32.2)% ........................... (104,000,550)
------------
NET ASSETS--100% $323,431,412
============

- ----------
* Using the higher of Standard & Poor's, Moody's or Fitch's rating.
** Security is exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from
registration to qualified institutional buyers.
*** Illiquid securities representing 0.6% of portfolio assets.
@ Entire or partial principal amount pledged as collateral for reverse
repurchase agreements or financial futures contracts.
@@ Securities are restricted as to public resale. The securities were acquired
in 1997 and have an aggregate current cost of $482,876.

- --------------------------------------------------------------------------------
KEY TO ABBREVIATIONS
G.O.-- General Obligation.
LIBOR-- London InterBank Offer Rate.
REMIC-- Real Estate Mortgage Investment Conduit.
- --------------------------------------------------------------------------------
See Notes to Financial Statements.

<PAGE>
- --------------------------------------------------------------------------------
THE BLACKROCK INVESTMENT
QUALITY TERM TRUST INC.
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
- --------------------------------------------------------------------------------

ASSETS
Investments, at value (cost $461,832,266)
(Note 1) ................................................... $445,305,962
Cash ......................................................... 471,981
Deposit with brokers as collateral for investments
sold short (Note 1) ........................................ 18,421,876
Interest receivable 5,878,227
Interest rate cap, at value (amortized cost $550,870)
(Note 1 and 3) ............................................. 616,168
Receivable for investments sold .............................. 286,394
------------
470,980,608
------------
LIABILITIES
Reverse repurchase agreements (Note 4) ....................... 126,627,375
Investment sold short, at value
(proceeds $18,919,824) (Note 1) ............................ 17,874,000
Dividends payable ............................................ 1,380,399
Interest payable ............................................. 880,231
Due to broker-variation margin ............................... 375,000
Investment advisory fee payable (Note 2) ..................... 161,294
Administration fee payable (Note 2) .......................... 26,882
Other accrued expenses ....................................... 224,015
------------
147,549,196
------------
NET ASSETS ................................................... $323,431,412
============
Net assets were comprised of:
Common stock, at par (Note 5) .............................. $ 368,106
Paid-in capital in excess of par ........................... 344,145,594
------------
344,513,700
Undistributed net investment income ........................ 7,818,843
Accumulated net realized loss .............................. (13,191,949)
Net unrealized depreciation ................................ (15,709,182)
------------
Net assets, December 31, 1999 .............................. $323,431,412
============
Net asset value per share:
($323,431,412 O 36,810,639 shares of
common stock issued and outstanding) $8.79
=====

- --------------------------------------------------------------------------------
THE BLACKROCK INVESTMENT
QUALITY TERM TRUST INC.
STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1999
- --------------------------------------------------------------------------------
NET INVESTMENT INCOME
Income
Interest earned (net of premium amortization
of $6,528,179 and interest expense of
$9,307,588) .............................................. $ 21,983,319
------------
Operating Expenses
Investment advisory ........................................ 2,007,320
Administration ............................................. 334,553
Reports to shareholders .................................... 91,000
Custodian .................................................. 89,000
Independent accountants .................................... 85,000
Directors .................................................. 84,000
Legal ...................................................... 50,000
Registration ............................................... 35,000
Transfer agent ............................................. 21,000
Miscellaneous .............................................. 88,023
------------
Total operating expenses ................................. 2,884,896
------------
Net investment income before excise tax ...................... 19,098,423
Excise tax ................................................. 200,000
------------
Net investment income ...................................... 18,898,423
------------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS
Net realized gain (loss) on:
Investments ................................................ (4,076,637)
Short sales ................................................ 2,120,761
Interest rate swaps ........................................ 1,112,319
Options written ............................................ 490,000
Futures .................................................... (9,591,499)
------------
(9,945,056)
------------
Net change in unrealized appreciation (depreciation) on:
Investments ................................................ (22,514,249)
Short sales ................................................ 1,877,856
Interest rate caps ......................................... 646,707
Interest rate swaps ........................................ (326,625)
Options written ............................................ 1,286,320
Futures .................................................... (210,080)
------------
(19,240,071)
------------
Net loss on investments .................................... (29,185,127)
-------------
NET DECREASE IN NET ASSETS
RESULTING FROM OPERATIONS .................................. $(10,286,704)
============

See Notes to Financial Statements.

10
<PAGE>

- --------------------------------------------------------------------------------
THE BLACKROCK INVESTMENT
QUALITY TERM TRUST INC.
STATEMENT OF CASH FLOWS
YEAR ENDED DECEMBER 31, 1999
- --------------------------------------------------------------------------------

RECONCILIATION OF NET DECREASE IN NET ASSETS
RESULTING FROM OPERATIONS TO NET
CASH FLOWS USED FOR OPERATING ACTIVITIES
Net decrease in net assets resulting from
operations ................................................. $ (10,286,704)
------------
Decrease in investments ...................................... 24,251,663
Net realized loss ............................................ 9,945,056
Decrease in unrealized appreciation .......................... 19,240,071
Decrease in interest receivable .............................. 590,644
Decrease in receivable for investments sold .................. 14,225,210
Decrease in deposits with brokers for
investments sold short ..................................... 98,141,571
Decrease in investments sold short ........................... (48,669,750)
Decrease in swap option written .............................. (1,776,320)
Increase in interest rate cap ................................ (388,928)
Decrease in payable for investments purchased ................ (107,494,848)
Increase in due to broker-variation margin ................... 291,079
Increase in interest payable ................................. 109,300
Decrease in unrealized appreciation
on interest rate swap ..................................... 326,625
Decrease in other accrued expenses ........................... (231,817)
------------
Total adjustments ......................................... 8,559,556
------------
Net cash flows used for operating activities ................. $ (1,727,148)
============

INCREASE (DECREASE) IN CASH
Net cash flows used for operating activities ................. $ (1,727,148)
------------

Cash flows provided by financing activities:
Increase in reverse repurchase agreements ................. 20,758,625
Cash dividends paid ....................................... (18,559,496)
------------
Net cash flows provided by financing activities .............. 2,199,129
------------
Net increase in cash ...................................... 471,981
Cash at beginning of year ................................. --
------------
Cash at end of year ....................................... $ 471,981
============

- --------------------------------------------------------------------------------
THE BLACKROCK INVESTMENT
QUALITY TERM TRUST INC.
STATEMENTS OF CHANGES
IN NET ASSETS
- --------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31,
--------------------------
1999 1998
--------- ---------
INCREASE (DECREASE) IN
NET ASSETS

Operations:

Net investment income ........................ $18,898,423 $24,368,986

Net realized gain (loss) ..................... (9,945,056) 7,228,158
Net change in unrealized
depreciation ...................... (19,240,071) (6,378,656)
----------- -----------

Net increase (decrease) in
net assets resulting
from operations ........................... (10,286,704) 25,218,488

Dividends from net
investment income ......................... (18,252,742) (20,245,529)
----------- -----------
Total increase (decrease) .................... (28,539,446) 4,972,959

NET ASSETS

Beginning of year ................................ 351,970,858 346,997,899
----------- -----------

End of year (including
undistributed net
investment income of
$7,818,843 and
$6,973,162, respectively) ...................... $323,431,412 $351,970,858
============ ============

See Notes to Financial Statements.

11
<PAGE>

- --------------------------------------------------------------------------------
THE BLACKROCK INVESTMENT QUALITY TERM TRUST INC.
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
----------------------------------------------------------
1999 1998 1997 1996 1995
----- ----- ----- ----- -----
PER SHARE OPERATING PERFORMANCE:
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year ....................... $ 9.56 $ 9.43 $ 9.09 $ 9.50 $ 8.21
------- ------- ------- ------- -------
Net investment income (net of interest expense of $0.25,
$0.21, $0.21, $0.17 and $0.23, respectively) ......... 0.52 0.66 0.65 0.64 0.60
Net realized and unrealized gain (loss) (0.79) 0.02 0.31 (0.46) 1.31
------- ------- ------- ------- -------
Net increase (decrease) from investment operations ....... (0.27) 0.68 0.96 0.18 1.91
------- ------- ------- ------- -------
Dividends from net investment income ..................... (0.50) (0.55) (0.62) (0.59) (0.60)
Distributions in excess of net investment income ......... -- -- -- -- (0.02)
------- ------- ------- ------- -------
Total dividends and distributions ........................ (0.50) (0.55) (0.62) (0.59) (0.62)
------- ------- ------- ------- -------
Net asset value, end of year* ............................ $ 8.79 $ 9.56 $ 9.43 $ 9.09 $ 9.50
======= ======= ======= ======= =======
Market value, end of year* ............................... $ 7.88 $ 8.81 $ 8.38 $ 7.63 $ 7.88
======= ======= ======= ======= =======
TOTAL INVESTMENT RETURN .................................. (4.99)% 11.50% 18.58% 4.58% 21.91%
RATIOS TO AVERAGE NET ASSETS:
Operating expenses ....................................... 0.86% 0.85% 0.89% 0.91% 0.92%
Operating expenses and interest expense .................. 3.64% 2.99% 3.15% 2.83% 3.44%
Operating expenses, interest expense and excise taxes .... 3.70% 3.01% 3.15% 2.83% 3.44%
Net investment income .................................... 5.65% 6.89% 6.98% 7.03% 6.76%

SUPPLEMENTAL DATA:
Average net assets (in thousands) ........................ $334,553 $353,745 $341,607 $332,778 $328,950
Portfolio turnover ....................................... 81% 106% 135% 221% 160%
Net assets, end of year (in thousands) ................... $323,431 $351,971 $346,998 $334,779 $349,862
Reverse repurchase agreements outstanding,
end of year (in thousands) ............................. $126,627 $105,869 $142,948 $ 96,846 $112,007
Asset coverage++.......................................... $ 3,554 $ 4,325 $ 3,427 $ 4,457 $ 4,124
</TABLE>

- --------------
* Net asset value and market value are published in BARRON'S each Saturday
and THE WALL STREET JOURNAL each Monday.

+ Total investment return is calculated assuming a purchase of common stock
at the current market price on the first day and a sale at the current
market price on the last day of each year reported. Dividends and
distributions are assumed, for purposes of this calculation, to be
reinvested at prices obtained under the Trust's dividend reinvestment plan.
This calculation does not reflect brokerage commissions.

++ Per $1,000 of reverse repurchase agreements outstanding.

The information above represents the audited operating performance data for a
share of common stock outstanding, total investment return, ratios to average
net assets and other supplemental data, for each of the years indicated. This
information has been determined based upon financial information provided in the
financial statements and market value data for the Trust's shares.

See Notes to Financial Statements.

<PAGE>
- --------------------------------------------------------------------------------
THE BLACKROCK INVESTMENT QUALITY TERM TRUST INC.
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
NOTE 1. ORGANIZATION & ACCOUNTING POLICIES

The BlackRock Investment Quality Term Trust Inc. ("the Trust"), a Maryland
corporation, is a diversified, closed-end management investment company. The
Trust's investment objective is to manage a portfolio of fixed income securities
that will return $10 per share to investors on or about December 31, 2004 while
providing high monthly income. The ability of issuers of debt securities held by
the Trust to meet their obligations may be affected by economic developments in
a specific industry or region. No assurance can be given that the Trust's
investment objective will be achieved.

The following is a summary of significant accounting policies followed by the
Trust.

SECURITIES VALUATION: The Trust values mortgage-backed, asset-backed and other
debt securities, interest rate swaps, caps, floors and non-exchange traded
options on the basis of current market quotations provided by dealers or pricing
services approved by the Trust's Board of Directors. In determining the value of
a particular security, pricing services may use certain information with respect
to transactions in such securities, quotations from dealers, market transactions
in comparable securities, various relationships observed in the market between
securities, and calculated yield measures based on valuation technology commonly
employed in the market for such securities. Exchange-traded options are valued
at their last sales price as of the close of options trading on the applicable
exchanges. In the absence of a last sale, options are valued at the average of
the quoted bid and asked prices as of the close of business. A futures contract
is valued at the last sale price as of the close of the commodities exchange on
which it trades. Any securities or other assets for which such current market
quotations are not readily available are valued at fair value as determined in
good faith under procedures established by and under the general supervision and
responsibility of the Trust's Board of Directors.

Short-term securities having a remaining maturity of 60 days or less are
valued at amortized cost which approximates market value.

REPURCHASE AGREEMENTS: In connection with transactions in repurchase agreements,
the Trust's custodian takes possession of the underlying collateral securities,
the value of which at least equals the principal amount of the repurchase
transaction, including accrued interest. To the extent that any repurchase
transaction exceeds one business day, the value of the collateral is
marked-to-market on a daily basis to ensure the adequacy of the collateral. If
the seller defaults and the value of the collateral declines or if bankruptcy
proceedings are commenced with respect to the seller of the security,
realization of the collateral by the Trust may be delayed or limited.

OPTION SELLING/PURCHASING: When the Trust sells or purchases an option, an
amount equal to the premium received or paid by the Trust is recorded as a
liability or an asset and is subsequently adjusted to the current market value
of the option written or purchased. Premiums received or paid from writing or
purchasing options which expire unexercised are treated by the Trust on the
expiration date as realized gains or losses. The difference between the premium
and the amount paid or received on effecting a closing purchase or sale
transaction, including brokerage commissions, is also treated as a realized gain
or loss. If an option is exercised, the premium paid or received is added to the
proceeds from the sale or cost of the purchase in determining whether the Trust
has realized a gain or a loss on investment transactions. The Trust, as writer
of an option, may have no control over whether the underlying securities may be
sold (call) or purchased (put) and as a result bears the market risk of an
unfavorable change in the price of the security underlying the written option.

Options, when used by the Trust, help in maintaining a targeted duration.
Duration is a measure of the price sensitivity of a security or a portfolio to
relative changes in interest rates. For instance, a duration of "one" means that
a portfolio's or a security's price would be expected to change by approximately
one percent with a one percent change in interest rates, while a duration of
five would imply that the price would move approximately five percent in
relation to a one percent change in interest rates.

Option selling and purchasing is used by the Trust to effectively "hedge"
positions, or collections of positions, so that changes in interest rates do not
change the duration of the portfolio unexpectedly. In general, the Trust uses
options to hedge a long or short position or an overall portfolio that is longer
or shorter than the benchmark security. A call option gives the purchaser of the
option the right (but not obligation) to buy, and obligates the seller to sell
(when the option is exercised), the underlying position at the exercise price at
any time or at a specified time during the option period. A put option gives the
holder the right to sell and obligates the writer to buy the underlying position
at the exercise price at any time or at a specified time during the option
period. Put options can be pur-

<PAGE>

chased to effectively hedge a position or a portfolio against price declines if
a portfolio is long. In the same sense, call options can be pur chased to hedge
a portfolio that is shorter than its benchmark against price changes. The Trust
can also sell (or write) covered call options and put options to hedge portfolio
positions.

The main risk that is associated with purchasing options is that the option
expires without being exercised. In this case, the option expires worthless and
the premium paid for the option is considered the loss. The risk associated with
writing call options is that the Trust may forego the opportunity for a profit
if the market value of the underlying position increases and the option is
exercised. The risk in writing put options is that the Trust may incur a loss if
the market value of the underlying position decreases and the option is
exercised. In addition, as with futures contracts, the Trust risks not being
able to enter into a closing transaction for the written option as the result of
an illiquid market.

SWAPS: In an interest rate swap, one investor pays a floating rate of interest
on a notional principal amount and receives a fixed rate of interest on the same
notional principal amount for a specified period of time. Alternatively, an
investor may pay a fixed rate and receive a floating rate. Interest rate swaps
were conceived as asset/liability management tools. In more complex swaps, the
notional principal amount may decline (or amortize) over time.

During the term of the swap, changes in the value of the swap are recognized
as unrealized gains or losses by "marking-to-market" to reflect the market value
of the swap. When the swap is terminated, the Trust will record a realized gain
or loss equal to the difference between the proceeds from (or cost of) the
closing transaction and the Trust's basis in the contract, if any.

The Trust is exposed to credit loss in the event of non-performance by the
other party to the swap. However, the Trust does not anticipate non-performance
by any counterparty.

SWAP OPTIONS: Swap options are similar to options on securities except that
instead of selling or purchasing the right to buy or sell a security, the writer
or purchaser of the swap option is granting or buying the right to enter into a
previously agreed upon interest rate swap agreement at any time before the
expiration of the option. Premiums received or paid from writing or purchasing
options are recorded as liabilities or assets and are subsequently adjusted to
the current market value of the option written or purchased. Premiums received
or paid from writing or purchasing options which expire unexercised are treated
by the Trust on the expiration date as realized gains or losses. The difference
between the premium and the amount paid or received on effecting a closing
purchase or sale transaction, including brokerage commission, is also treated as
a realized gain or loss. If an option is exercised, the premium paid or received
is added to the proceeds from the sale or cost of the purchase in determining
whether the Trust has realized a gain or loss on investment transactions.

The main risk that is associated with purchasing swap options is that the
swap option expires without being exercised. In this case, the option expires
worthless and the premium paid for the swap option is considered the loss. The
main risk that is associated with the writing of a swap option is the market
risk of an unfavorable change in the value of the interest rate swap underlying
the written swap option.

Swap options may be used by the Trust to manage the duration of the Trust's
portfolio in a manner similar to more generic options described above.

FINANCIAL FUTURES CONTRACTS: A futures contract is an agreement between two
parties to buy and sell a financial instrument for a set price on a future date.
Initial margin deposits are made upon entering into futures contracts and can be
either cash or securities. During the period the futures contract is open,
changes in the value of the contract are recognized as unrealized gains or
losses by "marking-to-market" on a daily basis to reflect the market value of
the contract at the end of each day's trading. Variation margin payments are
made or received, depending upon whether unrealized gains or losses are
incurred. When the contract is closed, the Trust records a realized gain or loss
equal to the difference between the proceeds from (or cost of) the closing
transaction and the Trust's basis in the contract.

Financial futures contracts, when used by the Trust, help in maintaining a
targeted duration. Futures contracts can be sold to effectively shorten an
otherwise longer duration portfolio. In the same sense, futures contracts can be
purchased to lengthen a portfolio that is shorter than its duration target.
Thus, by buying or selling futures contracts, the Trust can effectively "hedge"
positions so that changes in interest rates do not change the duration of the
portfolio unexpectedly.

The Trust may invest in financial futures contracts primarily for the purpose
of hedging its existing portfolio securities or securities the Trust intends to
purchase against fluctuations in value caused by changes in prevailing market
interest rates. Should interest rates move unexpectedly, the Trust may not
achieve the anticipated benefits of the financial futures contracts and may
realize a loss. The use of futures transactions involves the risk of imperfect
correlation in movements in the price of futures contracts, interest rates and
the underlying hedged assets. The Trust is also at risk of not being able to
enter into a closing transaction for the futures contract because of an illiquid
secondary market.

14
<PAGE>

In addition, since futures are used to shorten or lengthen a portfolio's
duration, there is a risk that the portfolio may have temporarily performed
better without the hedge or that the Trust may lose the opportunity to realize
appreciation in the market price of the underlying positions.

SHORT SALES: The Trust may make short sales of securities as a method of hedging
potential price declines in similar securities owned. When the Trust makes a
short sale, it may borrow the security sold short and deliver it to the
broker-dealer through which it made the short sale as collateral for its
obligation to deliver the security upon conclusion of the sale. The Trust may
have to pay a fee to borrow the particular securities and may be obligated to
pay over any payments received on such borrowed securities. A gain, limited to
the price at which the Trust sold the security short, or a loss, unlimited as to
dollar amount will be recognized upon the termination of a short sale if the
market price is less or greater than the proceeds originally received.

SECURITIES LENDING: The Trust may lend its portfolio securities to qualified
institutions. The loans are secured by collateral at least equal, at all times,
to the market value of the securities loaned. The Trust may bear the risk of
delay in recovery of, or even loss of rights in, the securities loaned should
the borrower of the securities fail financially. The Trust receives compensation
for lending its securities in the form of interest on the loan. The Trust also
continues to receive interest on the securities loaned, and any gain or loss in
the market price of the securities loaned that may occur during the term of the
loan will be for the account of the Trust.

The Trust did not engage in securities lending during the year ended December
31, 1999.

INTEREST RATE CAPS: Interest rate caps are similar to interest rate swaps,
except that one party agrees to pay a fee, while the other party pays the
excess, if any, of a floating rate over a specified fixed or floating rate.

Interest rate caps are intended to both manage the duration of the Trust's
portfolio and its exposure to changes in short-term rates. Owning interest rate
caps reduces the portfolio's duration, making it less sensitive to changes in
interest rates from a market value perspective. The effect on income involves
protection from rising short-term rates, which the Trust experiences primarily
in the form of leverage.

The Trust is exposed to credit loss in the event of non-performance by the
other party to the interest rate cap. However, the Trust does not anticipate
non-performance by any counterparty.

Transactions fees paid or received by the Trust are recognized as assets or
liabilities and amortized or accreted into interest expense or income over the
life of the interest rate cap. The asset or liability is subsequently adjusted
to the current market value of the interest rate cap purchased or sold. Changes
in the value of the interest rate cap are recognized as unrealized gains and
losses.

INTEREST RATE FLOORS: Interest rate floors are similar to interest rate swaps,
except that one party agrees to pay a fee, while the other party pays the
deficiency, if any, of a floating rate under a specified fixed or floating rate.

Interest rate floors are used by the Trust to both manage the duration of the
portfolio and its exposure to changes in short-term interest rates. Selling
interest rate floors reduces the portfolio's duration, making it less sensitive
to changes in interest rates from a market value perspective. The Trust's
leverage provides extra income in a period of falling rates. Selling floors
reduces some of that advantage by partially monetizing it as an up front payment
which the Trust receives.

The Trust is exposed to credit loss in the event of non-performance by the
other party to the interest rate floor. However, the Trust does not anticipate
non-performance by any counterparty.

Transactions fees paid or received by the Trust are recognized as assets or
liabilities and amortized or accreted into interest expense or income over the
life of the interest rate floor. The asset or liability is subsequently adjusted
to the current market value of the interest rate floor purchased or sold.
Changes in the value of the interest rate floor are recognized as unrealized
gains and losses.

SECURITIES TRANSACTIONS AND NET INVESTMENT INCOME: Securities transactions are
recorded on the trade date. Realized and unrealized gains and losses are
calculated on the identified cost basis. Interest income is recorded on the
accrual basis, and the Trust accretes discount and amortizes premium on
securities purchased using the interest method.

TAXES: It is the Trust's intention to continue to meet the requirements of the
Internal Revenue Code applicable to regulated investment companies and to
distribute sufficient taxable income to shareholders. Therefore, no federal
income tax provision is required. As part of a tax planning strategy, the Trust
intends to retain a portion of its taxable income and pay an excise tax on the
undistributed amounts.

DIVIDENDS AND DISTRIBUTIONS: The Trust declares and pays dividends and
distributions monthly, first from net invest-ment income, then from realized
short-term capital gains and other sources, if necessary. Net long-term capital
gains,

15
<PAGE>

if any, in excess of loss carryforwards may be distributed at least annually.
Dividends and distributions are recorded on the ex-dividend date.

Income distributions and capital gain distributions are determined in
accordance with income tax regulations which may differ from generally accepted
accounting principles.

RECLASSIFICATION OF CAPITAL ACCOUNTS: The Trust accounts for and reports
distributions to shareholders in accordance with the American Institute of
Certified Public Accountants' Statement of Position 93-2. Determination,
Disclosure, and Financial Statement Presentation of Income, Capital Gain, and
Return of Capital Distributions by Investment Companies. The effect caused by
applying this statement was to decrease paid-in capital and increase
undistributed net investment income by $200,000 due to certain expenses not
being deductible for tax purposes. Net investment income, net realized gains and
net assets were not affected by this change.

ESTIMATES: The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities 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.

NOTE 2. AGREEMENTS

The Trust has an Investment Advisory Agreement with BlackRock Financial
Management Inc. (the "Advisor"), a wholly-owned subsiary of BlackRock Advisors
Inc., which is a wholly-owned subsidiary of BlackRock, Inc., which in turn is an
indirect majority-owned subsidiary of PNCBank Corp. The Trust has an
Administration Agreement with Prudential Investments Fund Management LLC
("PIFM"), an indirect, wholly-owned subsidiary of The Prudential Insurance Co.
of America.

The investment advisory fee paid to the Advisor is computed weekly and
payable monthly at an annual rate of 0.60% of the Trust's average weekly net
assets. The administration fee paid to PIFM is also computed weekly and payable
monthly at an annual rate of 0.10% of the Trust's average weekly net assets
until December 31, 2002, and 0.08% from January 1, 2003 to the termination or
liquidation of the Trust.

Pursuant to the agreements, the Advisor provides continuous supervision of
the investment portfolio and pays the compensation of officers of the Trust who
are affiliated persons of the Advisor. PIFM pays occupancy and certain clerical
and accounting costs of the Trust. The Trust bears all other costs and expenses.

NOTE 3. PORTFOLIO SECURITIES
Purchases and sales of investment securities, other than short-term investments
and dollar rolls, for the year ended December 31, 1999 aggregated $378,467,876
and $338,405,655, respectively.

The Trust may invest up to 30% of its total assets in securities which are
not readily marketable, including those which are restricted as to disposition
under securities law ("restricted securities"). At December 31, 1999, the Trust
held 11% of its portfolio assets in securities restricted as to resale.

The Trust may from time to time purchase in the secondary market certain
mortgage pass-through securities packaged or master serviced by affiliates such
as PNC Mortgage Securities Corp. (or Sears Mortgage if PNC Mortgage Securities
Corp. succeeded to rights and duties of Sears) or mortgage related securities
containing loans or mortgages originated by PNC Bank or its affiliates,
including Midland Loan Services, Inc. It is possible under certain
circumstances, PNC Mortgage Securities Corp. or its affiliates, including
Midland Loan Services, Inc. could have interests that are in conflict with the
holders of these mortgage backed securities, and such holders could have rights
against PNC Mortgage Securities Corp. or its affiliates, including Midland Loan
Services, Inc.

The federal income tax basis of the Trust's investments at December 31, 1999
was substantially the same as for financial reporting purposes and, accordingly,
net unrealized depreciation for federal income tax purposes was $16,780,056
(gross unrealized appreciation--$8,056,892;

16
<PAGE>

gross unrealized depreciation--$24,836,948).

For federal income tax purposes, the Trust has a capital loss carryforward at
December 31, 1999 of approximately $15,774,000 of which approximately $530,000
will expire in 2002, approximately $3,845,000 will expire in 2003, approximately
$1,498,000 will expire in 2005, and approximately $9,901,000 will expire in
2007. Accordingly, no capital gains distribution is expected to be paid to
shareholders until net gains have been realized in excess of such amounts.

Details of open financial futures contracts at December 31, 1999 are as
follows:

VALUE AT VALUE AT
NUMBER OF EXPIRATION TRADE DECEMBER 31, UNREALIZED
CONTRACTS TYPE DATE DATE 1999 DEPRECIATION
- -------- ----- -------- ------- ------------- ------------
Long position: 30-Yr.
750 T-Bond Mar 00 $68,497,125 $68,203,125 $(294,000)
=========

Details of the interest rate cap held at December 31, 1999 are as follows:

NOTIONAL VALUE AT
AMOUNT FIXED FLOATING TERMINATION AMORTIZED DEC. 31, UNREALIZED
(000) RATE RATE DATE COST 1999 APPRECIATION
- ------------ ------------- ----------- ---------- ---------- -------------
$40,000 6.00% 3-month LIBOR 2/14/02 $550,870 $616,168 $65,298
=======

NOTE 4. BORROWINGS

REVERSE REPURCHASE AGREEMENTS: The Trust may enter into reverse repurchase
agreements with qualified, third party broker-dealers as determined by and under
the direction of the Trust's Board of Directors. Interest on the value of
reverse repurchase agreements issued and outstanding will be based upon
competitive market rates at the time of issuance. At the time the Trust enters
into a reverse repurchase agreement, it will establish and maintain a segregated
account with the lender, the value of which at least equals the principal amount
of the reverse repurchase transactions including accrued interest.

The average daily balance of reverse repurchase agreements outstanding during
the year ended December 31, 1999 was approximately $140,862,007 at a weighted
average interest rate of approximately 5.10%. The maximum amount of reverse
repurchase agreements outstanding at any month-end during the year was
$212,285,738 as of September 30, 1999, which was 38.9% of total assets.

DOLLAR ROLLS: The Trust may enter into dollar rolls in which the Trust sells
securities for delivery in the current month and simultaneously contracts to
repurchase substantially similar (same type, coupon and maturity) securities on
a specified future date. During the roll period the Trust forgoes principal and
interest paid on the securities. The Trust will be compensated by the interest
earned on the cash proceeds of the initial sale and by the lower repurchase
price at the future date.

The average monthly balance of dollar rolls outstanding during the year ended
December 31, 1999 was approximately $15,479,533. The maximum amount of dollar
rolls outstanding at any month-end during the year was $41,961,876 as of April
30, 1999, which was 8.2% of total assets. There were no dollar rolls outstanding
at December 31, 1999.

NOTE 5. CAPITAL
There are 200 million shares of $.01 par value common stock authorized. Of the
36,810,639 shares outstanding at December 31, 1999, the Advisor owned 10,639
shares.

<PAGE>
- --------------------------------------------------------------------------------
THE BLACKROCK INVESTMENT QUALITY TERM TRUST INC.
REPORT OF INDEPENDENT AUDITORS
- --------------------------------------------------------------------------------

The Shareholders and Board of Directors of
The BlackRock Investment Quality Term Trust Inc.:

We have audited the accompanying statement of assets and liabilities of The
BlackRock Investment Quality Term Trust Inc., including the portfolio of
investments, as of December 31, 1999, and the related statements of operations
and of cash flows for the year then ended, the statement of changes in net
assets for each of the two years in the period then ended, and the financial
highlights for each of the five years in the period then ended. These financial
statements and financial highlights are the responsibility of the Trust's
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 securities owned at December
31, 1999, by correspondence with the custodian and brokers; where replies were
not received from brokers, we performed other auditing procedures. 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 position of The
BlackRock Investment Quality Term Trust Inc. as of December 31, 1999, and the
results of its operations, its cash flows, the changes in its net assets and its
financial highlights for the respective stated periods in conformity with
generally accepted accounting principles.

/s/ DELOITTE & TOUCHE LLP
- -------------------------
Deloitte & Touche LLP

New York, New York
February 11, 2000

<PAGE>

- --------------------------------------------------------------------------------
THE BLACKROCK INVESTMENT QUALITY TERM TRUST INC.
TAX INFORMATION
- --------------------------------------------------------------------------------

We wish to advise you as to the federal tax status of dividends and
distributions paid by the Trust during the taxable year ended December 31, 1999.
During the fiscal year ended December 31, 1999, the Trust paid aggregate
dividends of $0.50 per share from net investment income taxable as 1999 income
to shareholders of record from January 1 toDecember 31, 1999. For federal income
tax purposes, the dividends you received are reportable in your 1999 federal
income tax return as ordinary income. Further, we wish to advise you that your
income dividends do not qualify for the dividends received deduction.
We are required by Massachusetts, Missouri, and Oregon to inform you that
dividends which have been derived from interest on federal obligations are not
taxable to shareholders. Please be advised that 23.19% of the dividends paid
from ordinary income in the fiscal year ended December 31, 1999 qualify for each
of these states' tax exclusion.
For the purpose of preparing your 1999 annual federal income tax return,
however, you should report the amounts as reflected on the appropriate Form 1099
DIV which was mailed to you in January 2000.

- --------------------------------------------------------------------------------
DIVIDEND REINVESTMENT PLAN
- --------------------------------------------------------------------------------

Pursuant to the Trust's Dividend Reinvestment Plan (the "Plan"),
shareholders may elect to have all distributions of dividends and capital gains
reinvested by State Street Bank and Trust Company (the "Plan Agent") in Trust
shares pursuant to the Plan. Shareholders who do not participate in the Plan
will receive all distributions in cash paid by check in United States dollars
mailed directly to the shareholders of record (or if the shares are held in
street or other nominee name, then to the nominee) by the transfer agent, as
dividend disbursing agent.
The Plan Agent serves as agent for the shareholders in administering the
Plan. After the Trust declares a dividend or determines to make a capital gain
distribution, the Plan Agent will, as agent for the participants, receive the
cash payment and use it to buy Trust shares in the open market on the New York
Stock Exchange or elsewhere, for the participants' accounts. The Trust will not
issue any new shares in connection with the Plan.
Participants in the Plan may withdraw from the Plan upon written notice to
the Plan Agent and will receive certificates for whole Trust shares and a cash
payment will be made for any fraction of a Trust share.

The Plan Agent's fees for the handling of the reinvestment of dividends
and distributions will be paid by the Trust. However, each participant will pay
a pro rata share of brokerage commissions incurred with respect to the Plan
Agent's open market purchases in connection with the reinvestment of dividends
and distributions. The automatic reinvestment of dividends and distributions
will not relieve participants of any federal, state or local income taxes that
may be payable on such dividends or distributions.

The Trust reserves the right to amend or terminate the Plan as applied to
any dividend or distribution paid subsequent to written notice of the change
sent to all shareholders of the Trust at least 90 days before the record date
for the dividend or distribution. The Plan also may be amended or terminated by
the Plan Agent upon at least 90 days' written notice to all shareholders of the
Trust. All correspondence concerning the Plan should be directed to the Plan
Agent at (800) 699-1BFM. The addresses are on the front of this report.

- --------------------------------------------------------------------------------
ADDITIONAL INFORMATION
- --------------------------------------------------------------------------------

There have been no material changes in the Trust's investment objectives
or policies that have not been approved by the shareholders or to its charter or
by-laws or in the principal risk factors associated with investment in the
Trust. There have been no changes in the persons who are primarily responsible
for the day-to-day management of the Trust's portfolio.

We have transitioned into the Year 2000, and it is business as usual at
BlackRock.

19
<PAGE>

- --------------------------------------------------------------------------------
THE BLACKROCK INVESTMENT QUALITY TERM TRUST INC.
INVESTMENT SUMMARY
- --------------------------------------------------------------------------------

THE TRUST'S INVESTMENT OBJECTIVE
The BlackRock Investment Quality Term Trust Inc.'s investment objective is to
manage a portfolio of investment grade fixed income securities that will return
$10 per share (the initial public offering price per share) to investors on or
about December 31, 2004.

WHO MANAGES THE TRUST?
BlackRock Advisors, Inc. is an SEC-registered investment advisor. As of December
31, 1999, BlackRock and its affiliates (together, "BlackRock") managed $165
billion on behalf of taxable and tax-exempt clients worldwide. Strategies
include fixed income, equity and cash any may incorporate both domestic and
international securities. Domestic fixed income strategies utilize the
government, mortgage, corporate and municipal bond sectors.BlackRock manages
twenty-two closed-end funds that are traded on either the New York or American
stock exchanges, and a $27 billion family of open-end funds. BlackRock manages
over 580 accounts, domiciled in the United States and overseas.

WHAT CAN THE TRUST INVEST IN?
The Trust may invest in all fixed income securities rated investment grade or
higher ("AAA", "AA", "A" or "BBB"). Examples of securities in which the Trust
may invest include U.S. government and government agency securities, zero coupon
securities, mortgage-backed securities, corporate debt securities, asset-backed
securities, U.S. dollar-denominated foreign debt securities and municipal
securities. Under current market conditions, BlackRock expects that the primary
investments of the Trust will be U.S. government securities, securities backed
by government agencies (such as mortgage-backed securities) and corporate debt
securities.

WHAT IS THE ADVISOR'S INVESTMENT STRATEGY?
The Advisor will seek to meet the Trust's investment objective by managing the
assets of the Trust so as to return the initial offering price ($10 per share)
at maturity. The Advisor will implement a conservative strategy that will seek
to closely match the maturity of the assets of the portfolio with the future
return of the initial investment at the end of 2004. At the Trust's termination,
the Advisor expects that the value of the securities which have matured,
combined with the value of the securities that are sold will be sufficient to
return the initial offering price to investors. On a continuous basis, the Trust
will seek its objective by actively managing its assets in relation to market
conditions, interest rate changes and, importantly, the remaining term to
maturity of the Trust.

In order to maintain competitive yields as the Trust approaches maturity and
depending on market conditions, the Advisor will attempt to purchase securities
with call protection or maturities as close to the Trust's maturity date as
possible. Securities with call protection should provide the portfolio with some
degree of protection against reinvestment risk during times of lower prevailing
interest rates. Since the Trust's primary goal is to return the initial offering
price at maturity, any cash that the Trust receives prior to its maturity date
(i.e. cash from early and regularly scheduled payments of principal on
mortgage-backed securities) will be reinvested in securities with maturities
which coincide with the remaining term of the Trust. Since shorter-term
securities typically yield less than longer-term securities, this strategy will
likely result in a decline in the Trust's income over time. It is important to
note that the Trust will be managed so as to preserve the integrity of the
return of the initial offering price.

<PAGE>

HOW ARE THE TRUST'S SHARES PURCHASED AND SOLD? DOES THE TRUST PAY DIVIDENDS
REGULARLY?
The Trust's shares are traded on the New York Stock Exchange which provides
investors with liquidity on a daily basis. Orders to buy or sell shares of the
Trust must be placed through a registered broker or financial Advisor. The Trust
pays monthly dividends which are typically paid on the last business day of the
month. For shares held in the shareholder's name, dividends may be reinvested in
additional shares of the fund through the Trust's transfer agent, State Street
Bank & Trust Company. Investors who wish to hold shares in a brokerage account
should check with their financial Advisor to determine whether their brokerage
firm offers dividend reinvestment services.

LEVERAGE CONSIDERATIONS IN A TERM TRUST
Under current market conditions, leverage increases the income earned by the
Trust. The Trust employs leverage primarily through the use of reverse
repurchase agreements and dollar rolls. Leverage permits the Trust to borrow
money at short-term rates and reinvest that money in longer-term assets which
typically offer higher interest rates. The difference between the cost of the
borrowed funds and the income earned on the proceeds that are invested in longer
term assets is the benefit to the Trust from leverage.

Leverage also increases the duration (or price volatility of the net assets) of
the Trust, which can improve the performance of the fund in a declining rate
environment, but can cause net assets to decline faster than the market in a
rising environment. The Advisor's portfolio managers continuously monitor and
regularly review the Trust's use of leverage and the Trust may reduce, or
unwind, the amount of leverage employed should the Advisor consider that
reduction to be in the best interests of the shareholders.

SPECIAL CONSIDERATIONS AND RISK FACTORS RELEVANT TO TERM TRUSTS
THE TRUST IS INTENDED TO BE A LONG-TERM INVESTMENT AND IS NOT A SHORT-TERM
TRADING VEHICLE.

RETURN OF INITIAL INVESTMENT. Although the objective of the Trust is to return
its initial offering price upon termination, there can be no assurance that this
objective will be achieved.

DIVIDEND CONSIDERATIONS. The income and dividends paid by the Trust are likely
to decline to some extent over the term of the Trust due to the anticipated
shortening of the dollar-weighted average maturity of the Trust's assets.

INTEREST-ONLY SECURITIES (IO). The yield to maturity on an IO class is extremely
sensitive to the rate of principal payments (including prepayments) on the
related underlying mortgage assets, and a rapid rate of principal payments may
have a material adverse effect on such security's yield to maturity. If the
underlying mortgage assets experience greater than anticipated prepayments of
principal, the Trust may fail to recoup fully its initial investment in these
securities even if the securities are rated AAA by S&P or Aaa by Moody's.

LEVERAGE. The Trust utilizes leverage through reverse repurchase agreements and
dollar rolls, which involves special risks. The Trust's net asset value and
market value may be more volatile due to its use of leverage.

MARKET PRICE OF SHARES. The shares of closed-end investment companies such as
the Trust trade on the New York Stock Exchange (NYSE symbol: BQT) and as such
are subject to supply and demand influences. As a result, shares may trade at a
discount or a premium to their net asset value.

MORTGAGE-BACKED AND ASSET-BACKED SECURITIES. The cash flow and yield
characteristics of these securities differ from traditional debt securities. The
major differences typically include more frequent payments and the possibility
of prepayments which will change the yield to maturity of the security.

CORPORATE DEBT SECURITIES. The value of corporate debt securities generally
varies inversely with changes in prevailing market interest rates. The Trust may
be subject to certain reinvestment risks in environments of declining interest
rates.

ZERO COUPON SECURITIES. Such securities receive no cash flows prior to maturity,
therefore interim price movements on these securities are generally more
sensitive to interest rate movements than securities that make periodic coupon
payments. These securities appreciate in value over time and can play an
important role in helping the Trust achieve its primary objective.

ILLIQUID SECURITIES. The Trust may invest in securities that are illiquid,
although under current market conditions the Trust expects to do so to only a
limited extent. These securities involve special risks.

NON-U.S SECURITIES. The Trust may invest up to 10% of its assets in non-U.S.
dollar-denominated securities which involve special risks such as currency,
political and economic risks, although under current market conditions does not
do so.

ANTITAKEOVER PROVISIONS. Certain antitakeover provisions will make a change in
the Trust's business or management more difficult without the approval of the
Trust's Board of Directors and may have the effect of depriving shareholders of
an opportunity to sell their shares at a premium above the prevailing market
price.

<PAGE>
- --------------------------------------------------------------------------------
THE BLACKROCK INVESTMENT QUALITY TERM TRUST INC.
GLOSSARY
- --------------------------------------------------------------------------------

ADJUSTABLE RATE MORTGAGE-
BACKED SECURITIES (ARMS): Mortgage instruments with interest rates
that adjust at periodic intervals at a
fixed amount over the market levels of
interest rates as reflected in specified
indexes. ARMS are backed by mortgage loans
secured by real property.

ASSET-BACKED SECURITIES: Securities backed by various types of
receivables such as automobile and credit
card receivables.

CLOSED-END FUND: Investment vehicle which initially offers
a fixed number of shares and trades on a
stock exchange. The fund invests in a
portfolio of securities in accordance with
its stated investment objectives and
policies.

COLLATERALIZED
MORTGAGE OBLIGATIONS (CMOS): Mortgage-backed securities which separate
mortgage pools into short-, medium-, and
long-term securities with different
priorities for receipt of principal and
interest. Each class is paid a fixed or
floating rate of interest at regular
intervals. Also known as multiple-class
mortgage pass-throughs.

COMMERCIAL MORTGAGE
BACKED SECURITIES (CMBS): Mortgage-backed securities secured or
backed by mortgage loans on commercial
properties.

DISCOUNT: When a fund's net asset value is greater
than its stock price the fund is said to
be trading at a discount.

DIVIDEND: Income generated by securities in a
portfolio and distributed to shareholders
after the deduction of expenses. This
Trust declares and pays dividends on a
monthly basis.

DIVIDEND REINVESTMENT: Shareholders may elect to have all
distributions of dividends and capital
gains automatically reinvested into
additional shares of the Trust.

FHA: Federal Housing Administration, a
government agency that facilitates a
secondary mortgage market by providing an
agency that guarantees timely payment of
interest and principal on mortgages.

FHLMC: Federal Home Loan Mortgage Corporation, a
publicly owned, federally chartered
corporation that facilitates a secondary
mortgage market by purchasing mortgages
from lenders such as savings institutions
and reselling them to investors by means
of mortgage-backed securities. Obligations
of FHLMC are not guaranteed by the U.S.
government, however; they are backed by
FHLMC's authority to borrow from the U.S.
government. Also known as Freddie Mac.

FNMA: Federal National Mortgage Association, a
publicly owned, federally chartered
corporation that facilitates a secondary
mortgage market by purchasing mortgages
from lenders such as savings institutions
and reselling them to investors by means
of mortgage-backed securities. Obligations
of FNMA are not guaranteed by the U.S.
government, however; they are backed by
FNMA's authority to borrow from the U.S.
government. Also known as Fannie Mae.

GNMA: Government National Mortgage Association,
a government agency that facilitates a
secondary mortgage market by providing an
agency that guarantees timely payment of
interest and principal on mortgages.
GNMA's obligations are supported by the
full faith and credit of the U.S.
Treasury. Also known as Ginnie Mae.

GOVERNMENT SECURITIES: Securities issued or guaranteed by the
U.S. government, or one of its agencies or
instrumentalities, such as GNMA, FNMA and
FHLMC.

<PAGE>

INVERSE-FLOATING RATE
MORTGAGES: Mortgage instruments with coupons that
adjust at periodic intervals according to
a formula which sets inversely with a
market lend interest rate index.

INTEREST-ONLY SECURITIES: Mortgage securities including CMBS that
receive only the interest cash flows from
an underlying pool of mortgage loans or
underlying pass-through securities.

MARKET PRICE: Price per share of a security trading in
the secondary market. For a closed-end
fund, this is the price at which one share
of the fund trades on the stock exchange.
If you were to buy or sell shares, you
would pay or receive the market price.

MORTGAGE DOLLAR ROLLS: A mortgage dollar roll is a transaction in
which the Trust sells mortgage-backed
securities for delivery in the current
month and simultaneously contracts to
repurchase substantially similar (although
not the same) securities on a specified
future date. During the "roll" period, the
Trust does not receive principal and
interest payments on the securities, but
is compensated for giving up these
payments by the difference in the current
sales price (for which the security is
sold) and lower price that the Trust pays
for the similar security at the end date
as well as the interest earned on the cash
proceeds of the initial sale.

MORTGAGE PASS-THROUGHS: Mortgage-backed securities issued by FNMA,
FHLMC, GNMA or FHA.

NET ASSET VALUE (NAV): Net asset value is the total market value
of all securities and other assets held by
the Trust, plus income accrued on its
investments, minus any liabilities
including accrued expenses, divided by the
total number of outstanding shares. It is
the underlying value of a single share on
a given day. Net asset value for the Trust
is calculated weekly and published in
BARRON'S on Saturday and THE WALL STREET
JOURNAL on Monday.

PRINCIPAL-ONLY SECURITIES: Mortgage securities that receive only the
principal cash flows from an underlying
pool of mortgage loans or underlying
pass-through securities.

PROJECT LOANS: Mortgages for multi-family, low- to
middle-income housing.

PREMIUM: When a fund's stock price is greater than
its net asset value, the fund is said to
be trading at a premium.

REMIC: A real estate mortgage investment conduit
is a multiple-class security backed by
mortgage-backed securities or whole
mortgage loans and formed as a trust,
corporation, partnership, or segregated
pool of assets that elects to be treated
as a REMIC for federal tax purposes.
Generally, FNMA REMICs are formed as
trusts and are backed by mortgage-backed
securities.

RESIDUALS: Securities issued in connection with
collateralized mortgage obligations that
generally represent the excess cash flow
from the mortgage assets underlying the
CMO after payment of principal and
interest on the other CMO securities and
related administrative expenses.

REVERSE REPURCHASE
AGREEMENTS: In a reverse repurchase agreement, the
Trust sells securities and agrees to
repurchase them at a mutually agreed date
and price. During this time, the Trust
continues to receive the principal and
interest payments from that security. At
the end of the term, the Trust receives
the same securities that were sold for the
same initial dollar amount plus interest
on the cash proceeds of the initial sale.

STRIPPED MORTGAGE-BACKED
SECURITIES: Arrangements in which a pool of assets is
separated into two classes that receive
different proportions of the interest and
principal distributions from underlying
mortgage-backed securities. IO's and PO's
are examples of strips.

<PAGE>
BlackRock
- --------------------------------------------------------------
DIRECTORS
Laurence D. Fink, CHAIRMAN
Andrew F. Brimmer
Richard E. Cavanagh
Kent Dixon
Frank J. Fabozzi
James Clayburn La Force, Jr.
Walter F. Mondale
Ralph L. Schlosstein

OFFICERS

Ralph L. Schlosstein, PRESIDENT
Scott Amero, VICE PRESIDENT
Keith T. Anderson, VICE PRESIDENT
Michael C. Huebsch, VICE PRESIDENT
Robert S. Kapito, VICE PRESIDENT
Richard M. Shea, VICE PRESIDENT/TAX
Henry Gabbay, TREASURER
James Kong, ASSISTANT TREASURER
Karen H. Sabath, SECRETARY

INVESTMENT ADVISOR
BlackRock Advisors, Inc.
400 Bellevue Parkway
Wilmington, DE 19809
(800) 227-7BFM

ADMINISTRATOR

Prudential Investments Fund Management LLC
Gateway Center Three
100 Mulberry Street
Newark, NJ 07102-4077

CUSTODIAN AND TRANSFER AGENT
State Street Bank and Trust Company
One Heritage Drive
North Quincy, MA 02171
(800) 699-1BFM

INDEPENDENT AUDITORS
Deloitte & Touche LLP
Two World Financial Center
New York, NY 10281-1434

LEGAL COUNSEL

Skadden, Arps, Slate, Meagher & Flom LLP
Four Times Square
New York, NY 10036

This report is for shareholder information. This is not a prospectus intended
for use in the purchase or sale of any securities.

THE BLACKROCK INVESTMENT
QUALITY TERM TRUST INC.

c/o Prudential Investments Fund Management LLC
Gateway Center Three
100 Mulberry Street

Newark, NJ 07102-4077
(800) 227-7BFM

09247J-102

The [BLACKROCK LOGO]
Investment Quality
Term Trust Inc.
- --------------------------------------------------------------------------------
Annual Report
December 31, 1999

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