Putnam
New York
Investment Grade
Municipal Trust
SEMIANNUAL REPORT ON PERFORMANCE AND OUTLOOK
10-31-98
[LOGO: BOSTON * LONDON * TOKYO]
From the Chairman
[GRAPHIC OMITTED: PHOTO OF GEORGE PUTNAM]
[copyright] Karsh, Ottawa
Dear Shareholder:
Solid economic growth, favorable credit fundamentals, and rising tax
revenues provided fertile ground for municipal bonds during the six months
ended October 31, 1998. In addition, falling interest rates brought
long-term municipal bond yields roughly in line with those of 30-year
Treasury bonds by the end of October, suggesting tax-free securities are
undervalued relative to Treasuries. Putnam New York Investment Grade
Municipal Trust appreciated 5.04% at net asset value and 10.46% at market
price on a total return basis for the period. For complete performance
information, please see pages 6 and 7.
I'm pleased to announce the appointment of Richard P. Wyke as the fund's
new manager. Rick has been with Putnam since 1987 and is also responsible
for the management of a number of other closed-end municipal bond funds
and institutional portfolios. He has 16 years of investment experience.
Jerome Jacobs, who had served as interim manager, continues to monitor the
fund in his role as chief investment officer of the Tax Exempt group.
* MUNICIPAL BONDS OFFER EXCEPTIONAL VALUE
Throughout the dramatic market shifts of 1998, the municipal market
continued to stand its ground. A steady string of international events
sparked the stock market volatility and bond market rallies. As foreign
investors and hedge fund shareholders panicked about plummeting stock
markets worldwide, they began a flight to quality -- selling hedge fund
and emerging-market positions in favor of the safety of U.S. Treasury
bonds. This buying spree drove up the prices of Treasuries and
consequently, because yields and prices move in an inverse relationship,
pulled down their yields. Since foreign investors do not benefit from the
tax advantages of municipal bonds, prices in this market did not rise as
much as those of Treasuries. As a result, with municipal bond yields about
equal to Treasury yields, municipals have become an exceptional investment
choice for U.S. investors.
Putnam Management expects the pace of the supply of tax-free securities to
decline -- a positive factor for municipal bond prices. Normally when
interest rates fall, refundings boost the bond supply. But because rates
have been low for some time, most issuers have already completed their
refundings and Rick expects that the supply of new issues will slow.
Perpetuating the slowdown in supply is the relationship of Treasury yields
to municipal yields. Since Treasury yields fell so dramatically relative
to municipal yields, the Treasury escrows used in prerefundings are not
adequate to pay off the municipal issues.
* CREDIT FUNDAMENTALS AND STRONG ECONOMY BUOY SECTORS
Strong economic growth, which propelled the U.S. stock market to record
highs during the period, is contributing to rising city and state tax
revenues. This, in turn, is improving investors' perception of New York's
creditworthiness -- prompting a series of credit upgrades by the major
rating agencies. Since the credit risk of the state's university system
closely tracks that of the state, this trend has had a positive effect on
the education bonds held in your fund's portfolio. At 17.8% of net assets,
colleges and university issues represented the largest sector at the
fiscal year's midpoint.
[GRAPHIC OMITTED: horizontal bar chart TOP INDUSTRY SECTORS]
TOP INDUSTRY SECTORS*
Education 17.8%
Health care 14.7%
Transportation 12.6%
Housing 11.0%
Utilities 8.4%
Footnote reads:
*Based on net assets as of 10/31/98. Holdings will vary over time.
[GRAPHIC OMITTED: pie chart CREDIT QUALITY OVERVIEW]
CREDIT QUALITY OVERVIEW*
Baa -- 16.4%
A -- 26.1%
Aa -- 21.7%
Aaa -- 34.4%
VMIGI -- 1.4%
Footnote reads:
*As a percentage of market value as of 10/31/98. A bond rated Baa or
higher is considered investment grade. All ratings reflect Moody's
descriptions unless noted otherwise; percentages may include unrated bonds
considered by Putnam Management to be of comparable quality. Ratings will
vary over time.
With so much good news factored into prices, New York City's bonds are
currently trading at a premium. We expect the credit ratings to remain
stable for the foreseeable future, but investors may begin to take profits
at these price levels. Nevertheless, the bonds' above-market yields make
them a valuable component of your fund's income strategy.
The vigor of the economy, along with low petroleum prices, also
contributed to the strong performance of the transportation sector.
Airlines are posting record profits and are in the best fiscal shape of
the decade. Current airline-related bonds include those backed by
carriers, such as American Airlines, that enjoy broad market
diversification.
Today's lower interest rates offer an important benefit for your fund. The
potential for declining income may, in part, be offset by the declining
cost of leveraging, a strategy that historically has been useful in
enhancing the fund's income level. The fund issues and sells preferred
shares to institutional short-term investors at low rates and reinvests
the proceeds in longer-term, higher-paying bonds. The effect is a more
positive cash flow. On October 31, 1998, 19.79% of the fund's net assets
were leveraged.
* CAUTIONARY OUTLOOK
The bond markets are beginning to move away from their obsession with
international markets. The Federal Reserve Board cut interest rates twice
in three weeks (and yet a third time in mid-November after the close of
this reporting period), which helped the U.S. bond markets pay more
attention to economic fundamentals and thus become more balanced. The
intermediate maturity range of the yield curve (8 to 15 years), which is
where many of the fund's holdings are positioned, has outperformed other
maturities, and this trend is likely to continue over the near term.
However, with yields on short-term securities falling in response to the
Fed's easing, the yield curve has steepened. There will come a time when a
shift to longer maturities will offer better performance. When this
opportunity presents itself, your management team will take the necessary
steps to capture the higher yields.
Respectfully yours,
/S/GEORGE PUTNAM
George Putnam
Chairman of the Trustees
December 16, 1998
The views expressed here are exclusively those of Putnam Management. They
are not meant as investment advice. Although the described holdings were
viewed favorably as of 10/31/98, there is no guarantee the fund will
continue to hold these securities in the future.
Performance summary
This section provides information about your fund's performance, which
should always be considered in light of its investment strategy. Putnam
New York Investment Grade Municipal Trust is designed for investors
seeking high current income free from federal, state, and New York City
income tax, consistent with preservation of capital.
TOTAL RETURN FOR PERIODS ENDED 10/31/98
Lehman Bros. Consumer
Market Municipal Price
(common shares) NAV price Bond Index Index
- -----------------------------------------------------------------------
6 months 5.04% 10.46% 5.11% 0.80%
- -----------------------------------------------------------------------
1 year 7.60 13.64 8.02 1.36
- -----------------------------------------------------------------------
5 years 30.85 33.69 36.12 12.42
Annual average 5.52 5.98 6.36 2.37
- -----------------------------------------------------------------------
Life of fund (11/27/92) 49.44 43.06 52.56 15.35
Annual average 7.02 6.24 7.40 2.44
- -----------------------------------------------------------------------
TOTAL RETURN FOR PERIODS ENDED 9/30/98
(most recent calendar quarter)
Market
(common shares) NAV price
- -----------------------------------------------------------------------
6 months 4.59% 3.82%
- -----------------------------------------------------------------------
1 year 8.45 11.16
- -----------------------------------------------------------------------
5 years 31.99 32.59
Annual average 5.71 5.80
- -----------------------------------------------------------------------
Life of fund 49.78 41.17
Annual average 7.16 6.08
- -----------------------------------------------------------------------
Performance data represent past results and do not reflect future
performance. They do not take into account any adjustment for taxes
payable on reinvested distributions. Investment returns, net asset value
and market price will fluctuate so that an investor's shares when sold may
be worth more or less than their original cost.
This performance information does not reflect any market volatility that
may have occurred since the date of the information. As a result, more
recent returns may be more or less than those shown.
PRICE AND DISTRIBUTION INFORMATION
6 months ended 10/31/98
- ------------------------------------------------------------------------------
Distributions (common shares)
- ------------------------------------------------------------------------------
Number 6
- ------------------------------------------------------------------------------
Income $0.405
- ------------------------------------------------------------------------------
Capital gains1 --
- ------------------------------------------------------------------------------
Total $0.405
- ------------------------------------------------------------------------------
Preferred shares Series A (200 shares)
- ------------------------------------------------------------------------------
Income $898.15
- ------------------------------------------------------------------------------
Capital gains --
- ------------------------------------------------------------------------------
Total $898.15
- ------------------------------------------------------------------------------
Share value (common shares) NAV Market price
- ------------------------------------------------------------------------------
4/30/98 $13.96 $13.625
- ------------------------------------------------------------------------------
10/31/98 14.25 14.625
- ------------------------------------------------------------------------------
Current return (common shares)
- ------------------------------------------------------------------------------
Current dividend rate2 5.68% 5.54%
- ------------------------------------------------------------------------------
Taxable equivalent3 10.53 10.27
- ------------------------------------------------------------------------------
1 Capital gains, if any, are taxable for federal and, in most cases, state
tax purposes. For some investors, investment income may also be subject to
the federal alternative minimum tax. Investment income may be subject to
state and local taxes.
2 Income portion of most recent distribution, annualized and divided by NAV
or POP at end of period.
3 Assumes maximum 46.08% combined federal, state, and city tax rate.
Results for investors subject to lower tax rates would not be as
advantageous.
TERMS AND DEFINITIONS
Total return shows how the value of the fund's shares changed over time,
assuming you held the shares through the entire period and reinvested all
distributions in the fund.
Net asset value (NAV) is the value of all your fund's assets, minus any
liabilities and the net assets allocated to remarketed preferred shares,
divided by the number of outstanding common shares.
Market price is the current trading price of one share of the fund. Market
prices are set by transactions between buyers and sellers on the New York
Stock Exchange.
COMPARATIVE BENCHMARKS
Lehman Brothers Municipal Bond Index is an unmanaged list of long-term
fixed-rate investment-grade tax-exempt bonds representative of the
municipal bond market. The index does not take into account brokerage
commissions, taxes or other costs, may include bonds different from those
in the fund, and may pose different risks than the fund. The index assumes
reinvestment of all distributions and interest payments. It is not
possible to invest directly in an index.
Consumer Price Index (CPI) is a commonly used measure of inflation; it
does not represent an investment return.
<TABLE>
<CAPTION>
Portfolio of investments owned
October 31, 1998 (Unaudited)
Key to Abbreviations
AMBAC -- AMBAC Indemnity Corporation
COP -- Certificate of Participation
FGIC -- Financial Guaranty Insurance Company
FHA Insd. -- Federal Housing Administration Insured
FSA -- Financial Security Assurance
G.O. Bonds -- General Obligation Bonds
IFB -- Inverse Floating Rate Bonds
LOC -- Letter of Credit
VRDN -- Variable Rate Demand Notes
MUNICIPAL BONDS AND NOTES (98.7%) (a)
PRINCIPAL AMOUNT RATINGS (RAT) VALUE
<S> <C> <C> <C>
New York (89.7%)
- --------------------------------------------------------------------------------------------------------------------------
$ 885,000 Ithaca, Hsg. Corp. Mtge. Rev. Bonds
(Eddygate Park Apts.), 9s, 6/1/06 BBB+/P $ 920,692
1,000,000 Long Island, Pwr. Auth. NY Elec. Syst. Rev. Bonds,
Ser. A, 5 1/4s, 12/1/26 A- 1,007,500
500,000 Metropolitan Trans. Auth. Svcs. Contract Rev.
Bonds (Trans. Fac.), Ser. O, 5 3/4s, 7/1/13 Baa1 557,500
1,000,000 Niagara Falls, School Dist. COP, 5 7/8s, 6/15/19 BBB- 1,063,750
NY City, G.O. Bonds
1,385,000 Ser. A, 8s, 8/15/19 AAA 1,563,319
5,000 Ser. B, 6 3/4s, 10/1/17 A- 5,563
230,000 Prerefunded, Ser. B, 6 3/4s, 10/1/17 A- 258,175
525,000 Ser. I, 6 1/4s, 4/15/17 A- 583,406
100,000 Ser. D, 6s, 2/15/25 A- 107,000
15,000 Prerefunded, Ser. D, 6s, 2/15/25 A- 16,763
1,000,000 Ser. F, 5 7/8s, 8/1/24 A- 1,071,250
1,155,000 Ser. F, 5 3/4s, 2/1/19 A- 1,224,300
2,000,000 NY City, G.O. Bonds, IFB, AMBAC, 8.13s, 9/1/11 (SEG) AAA 2,327,500
1,000,000 NY City, Indl. Dev. Agcy. Rev. Bonds
(Terminal One Group), 6s, 1/1/15 A- 1,061,250
NY City, Indl. Dev. Agcy. Special Fac. Rev. Bonds
(American Airlines, Inc.)
1,400,000 8s, 7/1/20 Baa2 1,435,168
1,525,000 6.9s, 8/1/24 Baa2 1,696,563
1,500,000 NY City, Muni. Wtr. & Swr. Fin. Auth. Rev. Bonds,
Ser. A, 4 3/4s, 6/15/31 Aaa 1,428,750
1,300,000 NY State Dorm. Auth. IFB (Cornell U.), 10.903s,
7/1/30 (acquired 1/6/93 cost $1,533,675) (RES) AA 1,501,500
NY State Dorm. Auth. Rev. Bonds
1,500,000 (State U. Edl. Fac.), Ser. A, 7 1/2s, 5/15/13 A3 1,968,750
2,000,000 (Cornell U.), Ser. A, 7 3/8s, 7/1/20 Aa2 2,157,500
2,000,000 (Mental Hlth. Svcs. Fac.), Ser. A, 5 3/4s, 2/15/27 A3 2,157,500
1,190,000 (City U. Syst. Construction), Ser. 1, 5 1/4s,
7/1/17 Baa1 1,218,263
2,000,000 NY State Energy Res. & Dev. Auth. Elec. Fac. Rev.
Bonds (Cons. Edison Co. of NY, Inc.), Ser. A,
7 1/2s, 1/1/26 A1 2,090,000
1,000,000 NY State Energy Res. & Dev. Auth. Poll. Control
Rev. Bonds (Niagara Mohawk Pwr. Corp.),
Ser. A, FGIC, 7.2s, 7/1/29 Aaa 1,163,750
1,600,000 NY State Env. Fac. Corp. Poll. Control Rev. Bonds
(State Wtr. Revolving Fund), Ser. A, 7 1/2s,
6/15/12 Aa2 1,724,000
200,000 NY State Hsg. Fin. Agcy. VRDN
(Normadie Court I), 2.5s, 5/15/15
(Landesbank Hessien (LOC)) VMIG1 200,000
500,000 NY State Local Govt. Assistance Corp. VRDN
Ser. B, 2.7s, 4/1/25 VMIG1 500,000
NY State Med. Care Fac. Fin. Agcy. Rev. Bonds
110,000 (Hosp. & Nursing Home Insd. Mtge.), Ser. B,
FHA Insd., 8s, 2/15/28 AAA 112,613
360,000 (Mental Hlth.), Ser. D, 7.4s, 2/15/18 A3 400,950
940,000 (Mental Hlth.), Prerefunded, Ser. D, 7.4s,
2/15/18 A- 1,063,375
1,720,000 (Hosp. & Nursing Home Insd. Mtge.), Ser. C,
6.65s, 8/15/32 Aa2 1,874,800
80,000 (Hosp. & Nursing Home Insd. Mtge.),
Prerefunded, Ser. C, 6.65s, 8/15/32 Aa2 89,500
1,800,000 (Hosp. & Nursing Home Insd. Mtge.), Ser. D,
FHA Insd., 6.6s, 2/15/31 AAA 1,959,750
1,800,000 (Hosp. & Nursing Home Insd. Mtge.), Ser. C,
FHA Insd, 6 3/8s, 8/15/29 AAA 1,939,500
1,800,000 NY State Mtge. Agcy. Rev. Bonds
(Homeownership Dev. Program), Ser. BB-2,
FHA Insd., 7.95s, 10/1/15 Aa2 1,845,378
2,075,000 NY State Urban Dev. Corp. Rev. Bonds, 7 1/2s,
4/1/20 Aaa 2,300,656
1,000,000 Onondaga Cnty., Indl. Dev. Agcy. Rev. Bonds
(Bristol-Myers Squibb Co.), 5 3/4s, 3/1/24 AAA 1,110,000
1,400,000 Port Auth. NY & NJ Cons. Rev. IFB, 8.9755s,
8/1/26 (acquired 7/19/93 cost $1,687,700) (RES) AA+ 1,613,500
--------------
45,319,734
Puerto Rico (9.0%)
- --------------------------------------------------------------------------------------------------------------------------
1,500,000 PR Elec. Pwr. Auth. IFB, FSA, 8.179s, 7/1/23 AAA 1,764,375
1,081,676 PR Hsg. Fin. Corp. Rev. Bonds
(Bayamon Hsg. Dev.), FHA Insd., 7 1/2s, 7/1/21 BBB+/P 1,272,321
1,365,000 PR Pub. Bldg. Auth. Gtd. Ed. & Hlth. Fac. Rev.
Bonds, Ser. L, 6 7/8s, 7/1/21 AAA 1,532,210
--------------
4,568,906
- --------------------------------------------------------------------------------------------------------------------------
Total Investments (cost $47,690,839) (b) $ 49,888,640
- --------------------------------------------------------------------------------------------------------------------------
(a) Percentages indicated are based on net assets of $50,566,301.
(RAT) The Moody's or Standard & Poor's ratings indicated are believed to be the most recent ratings available at
October 31, 1998 for the securities listed. Ratings are generally ascribed to securities at the time of issuance.
While the agencies may from time to time revise such ratings, they undertake no obligation to do so, and the ratings
do not necessarily represent what the agencies would ascribe to these securities at October 31, 1998. Securities
rated by Putnam are indicated by "/P" and are not publicly rated.
(b) The aggregate identified cost on a tax basis is $47,690,839, resulting in gross unrealized appreciation and
depreciation of $2,508,960 and $311,159, respectively, or net unrealized appreciation of $2,197,801.
(RES) Restricted, excluding 144A securities, as to public resale. The total market value of restricted securities
held at October 31, 1998 was $3,115,000 or 6.2% of net assets.
(SEG) A portion of this security was pledged and segregated with the custodian to cover margin requirements for
futures contracts at October 31, 1998.
The rates shown on IFBs, which are securities paying interest rates that vary inversely to changes in the
market interest rates, and VRDN's are the current interest rates at October 31, 1998.
The fund had the following industry group concentrations greater than 10% at October 31, 1998 (as a percentage
of net assets):
Education 17.8%
Health care 14.7
Transportation 12.6
Housing 11.0
The fund had the following insurance concentration greater than 10% at October 31, 1998 (as a percentage of
net assets):
FHA Insd. 14.1%
- -------------------------------------------------------------------------------
Futures Contracts Outstanding at October 31, 1998 (Unaudited)
Total Aggregate Face Expiration Unrealized
Market Value Value Date Depreciation
- -------------------------------------------------------------------------------
Municipal Bonds
Index (long) $2,007,500 $2,010,604 Dec-98 $(3,104)
- -------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
<CAPTION>
Statement of assets and liabilities
October 31, 1998 (Unaudited)
<S> <C>
Assets
- -----------------------------------------------------------------------------------------------
Investments in securities, at value
(identified cost $47,690,839) (Note 1) $49,888,640
- -----------------------------------------------------------------------------------------------
Cash 184,316
- -----------------------------------------------------------------------------------------------
Interest receivable 745,976
- -----------------------------------------------------------------------------------------------
Receivable for securities sold 1,494,793
- -----------------------------------------------------------------------------------------------
Total assets 52,313,725
Liabilities
- -----------------------------------------------------------------------------------------------
Payable for variation margin 12,000
- -----------------------------------------------------------------------------------------------
Distributions payable to shareholders 192,155
- -----------------------------------------------------------------------------------------------
Payable for securities purchased 1,428,909
- -----------------------------------------------------------------------------------------------
Payable for compensation of Manager (Note 2) 91,037
- -----------------------------------------------------------------------------------------------
Payable for investor servicing and custodian fees (Note 2) 4,315
- -----------------------------------------------------------------------------------------------
Payable for compensation of Trustees (Note 2) 7,942
- -----------------------------------------------------------------------------------------------
Other accrued expenses 11,066
- -----------------------------------------------------------------------------------------------
Total liabilities 1,747,424
- -----------------------------------------------------------------------------------------------
Net assets $50,566,301
Represented by
- -----------------------------------------------------------------------------------------------
Series A remarketed preferred shares (200 shares issued and
outstanding at $50,000 per share) (Note 4) $10,000,000
- -----------------------------------------------------------------------------------------------
Paid-in capital -- common shares (unlimited shares authorized) (Note 1) 39,510,376
- -----------------------------------------------------------------------------------------------
Undistributed net investment income (Note 1) 182,926
- -----------------------------------------------------------------------------------------------
Accumulated net realized loss on investments (Note 1) (1,321,698)
- -----------------------------------------------------------------------------------------------
Net unrealized appreciation of investments 2,194,697
- -----------------------------------------------------------------------------------------------
Total -- Representing net assets applicable to
capital shares outstanding $50,566,301
Net assets available to:
- -----------------------------------------------------------------------------------------------
Series A remarketed preferred shares $10,000,000
- -----------------------------------------------------------------------------------------------
Cumulative undeclared dividends on remarketed preferred shares 7,521
- -----------------------------------------------------------------------------------------------
Net assets allocated to remarketed preferred
shares -- liquidation preference $10,007,521
- -----------------------------------------------------------------------------------------------
Net assets available to common shares $40,558,780
- -----------------------------------------------------------------------------------------------
Net asset value per common share
($40,558,780 divided by 2,847,092 shares) $14.25
- -----------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
<CAPTION>
Statement of operations
Six months ended October 31, 1998 (Unaudited)
<S> <C>
Tax exempt interest income: $1,618,998
- -----------------------------------------------------------------------------------------------
Expenses:
- -----------------------------------------------------------------------------------------------
Compensation of Manager (Note 2) 181,941
- -----------------------------------------------------------------------------------------------
Investor servicing and custodian fees (Note 2) 28,040
- -----------------------------------------------------------------------------------------------
Compensation of Trustees (Note 2) 4,254
- -----------------------------------------------------------------------------------------------
Administrative services (Note 2) 2,395
- -----------------------------------------------------------------------------------------------
Reports to shareholders 6,331
- -----------------------------------------------------------------------------------------------
Auditing 13,320
- -----------------------------------------------------------------------------------------------
Legal 5,229
- -----------------------------------------------------------------------------------------------
Preferred share remarketing agent fees 10,532
- -----------------------------------------------------------------------------------------------
Other 281
- -----------------------------------------------------------------------------------------------
Total expenses 252,323
- -----------------------------------------------------------------------------------------------
Expense reduction (Note 2) (7,598)
- -----------------------------------------------------------------------------------------------
Net expenses 244,725
- -----------------------------------------------------------------------------------------------
Net investment income 1,374,273
- -----------------------------------------------------------------------------------------------
Net realized loss on investments (Notes 1 and 3) (39,248)
- -----------------------------------------------------------------------------------------------
Net realized gain on futures contracts (Note 1) 93,104
- -----------------------------------------------------------------------------------------------
Net unrealized appreciation of investments and futures during the period 705,047
- -----------------------------------------------------------------------------------------------
Net gain on investments 758,903
- -----------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations $2,133,176
- -----------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
<CAPTION>
Statement of changes in net assets
Six months ended Year ended
October 31 April 30
1998* 1998
<S> <C> <C>
- ---------------------------------------------------------------------------------------------------------------
Increase in net assets
- ---------------------------------------------------------------------------------------------------------------
Operations:
- ---------------------------------------------------------------------------------------------------------------
Net investment income $ 1,374,273 $ 2,701,063
- ---------------------------------------------------------------------------------------------------------------
Net realized gain (loss) on investments 53,856 (28,632)
- ---------------------------------------------------------------------------------------------------------------
Net unrealized appreciation of investments 705,047 1,316,409
- ---------------------------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations 2,133,176 3,988,840
Distributions to remarketed preferred shareholders:
- ---------------------------------------------------------------------------------------------------------------
From net investment income (179,630) (350,520)
- ---------------------------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations
applicable to common shareholders (excluding cumulative
undeclared dividends on remarketed preferred shares
of $7,521 and $19,562, respectively) 1,953,546 3,638,320
- ---------------------------------------------------------------------------------------------------------------
Distributions to common shareholders:
- ---------------------------------------------------------------------------------------------------------------
From net investment income (1,153,451) (2,305,843)
- ---------------------------------------------------------------------------------------------------------------
Total increase in net assets 800,095 1,332,477
Net assets
- ---------------------------------------------------------------------------------------------------------------
Beginning of period 49,766,206 48,433,729
- ---------------------------------------------------------------------------------------------------------------
End of period (including undistributed net investment
income of $182,926 and $141,734, respectively) $50,566,301 $49,766,206
- ---------------------------------------------------------------------------------------------------------------
Number of fund shares
- ---------------------------------------------------------------------------------------------------------------
Common shares outstanding at beginning and end of period 2,847,092 2,847,092
- ---------------------------------------------------------------------------------------------------------------
Remarketed preferred shares outstanding at beginning and
end of period 200 200
- ---------------------------------------------------------------------------------------------------------------
* Unaudited
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
<CAPTION>
Financial highlights
(For a share outstanding throughout the period)
- ------------------------------------------------------------------------------------------------------------------------------------
Six months
ended
Per-share October 31
operating performance (Unaudited) Year ended April 30
- ------------------------------------------------------------------------------------------------------------------------------------
1998 1998 1997 1996 1995 1994
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of
period (common shares) $13.96 $13.49 $13.54 $13.50 $13.86 $14.57
- ------------------------------------------------------------------------------------------------------------------------------------
Investment operations
- ------------------------------------------------------------------------------------------------------------------------------------
Net investment income .48 .95 .95 .98 1.06 1.05
- ------------------------------------------------------------------------------------------------------------------------------------
Net realized and unrealized
gain (loss) on investments .28 .45 (.07) .07 (.26) (.53)
- ------------------------------------------------------------------------------------------------------------------------------------
Total from investment operations .76 1.40 .88 1.05 .80 .52
- ------------------------------------------------------------------------------------------------------------------------------------
Less distributions from:
- ------------------------------------------------------------------------------------------------------------------------------------
Net investment income:
- ------------------------------------------------------------------------------------------------------------------------------------
To preferred shareholders (.06) (.12) (.12) (.13) (.13) (.13)
- ------------------------------------------------------------------------------------------------------------------------------------
To common shareholders (.41) (.81) (.81) (.88) (.94) (.93)
- ------------------------------------------------------------------------------------------------------------------------------------
Net realized gain on investments:
- ------------------------------------------------------------------------------------------------------------------------------------
To preferred shareholders -- -- -- -- (.01) (.02)
- ------------------------------------------------------------------------------------------------------------------------------------
To common shareholders -- -- -- -- (.08) (.15)
- ------------------------------------------------------------------------------------------------------------------------------------
Total distributions (.47) (.93) (.93) (1.01) (1.16) (1.23)
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period
(common shares) $14.25 $13.96 $13.49 $13.54 $13.50 $13.86
- ------------------------------------------------------------------------------------------------------------------------------------
Market value, end of period
(common shares) $14.625 $13.625 $12.875 $13.000 $13.625 $13.500
- ------------------------------------------------------------------------------------------------------------------------------------
Ratios and supplemental data
- ------------------------------------------------------------------------------------------------------------------------------------
Total investment return at market
value (common shares) (%)(a) 10.46* 12.12 5.34 1.78 9.09 (3.25)
- ------------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period
(total fund) (in thousands) $50,566 $49,766 $48,434 $48,583 $48,443 $49,480
- ------------------------------------------------------------------------------------------------------------------------------------
Ratio of expenses to
average net assets (%)(b)(c) .63* 1.31 1.44 1.34 1.35 1.23
- ------------------------------------------------------------------------------------------------------------------------------------
Ratio of net investment income
to average net assets (%)(b) 2.99* 5.90 6.10 6.19 6.87 6.23
- ------------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate (%) 16.77* 18.22 49.71 84.87 8.55 15.18
- ------------------------------------------------------------------------------------------------------------------------------------
* Not annualized.
(a) Total investment return assumes dividend reinvestment.
(b) Ratios reflect net assets available to common shares only; net investment income ratio also reflects
reduction for distributions to preferred shareholders.
(c) The ratio of expenses to average net assets for the year ended April 30, 1996 and thereafter,
includes amounts paid through expense offset arrangements. Prior period ratios
exclude these amounts. (Note 2)
</TABLE>
Notes to financial statements
October 31, 1998 (Unaudited)
Note 1
Significant accounting policies
Putnam New York Investment Grade Municipal Trust (the "fund") is
registered under the Investment Company Act of 1940, as amended, as a
non-diversified, closed-end management investment company. The fund's
investment objective is to seek high a current income exempt from federal
income tax and New York State and City personal income tax. The fund
intends to achieve its objective by investing in investment grade
municipal securities constituting a portfolio that Putnam Investment
Management, Inc., ("Putnam Management') the fund's Manager, a wholly-owned
subsidiary of Putnam Investments, Inc., believes to be consistent with
preservation of capital.
The following is a summary of significant accounting policies consistently
followed by the fund in the preparation of its financial statements. The
preparation of financial statements is in conformity with generally
accepted accounting principles and requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities. Actual results could differ from those estimates.
A) Security valuation Tax-exempt bonds and notes are stated on the basis
of valuations provided by a pricing service, approved by the Trustees,
which uses information with respect to transactions in bonds, quotations
from bond dealers, market transactions in comparable securities and
various relationships between securities in determining value. The fair
value of restricted securities is determined by Putnam Management
following procedures approved by the Trustees, and such valuations and
procedures are reviewed periodically by the Trustees.
B) Security transactions and related investment income Security
transactions are accounted for on the trade date (date the order to buy or
sell is executed). Interest income is recorded on the accrual basis.
C) Futures and options contracts The fund may use futures and options
contracts to hedge against changes in the values of securities the fund
owns or expects to purchase. The fund may also write options on securities
it owns or in which it may invest to increase its current returns.
The potential risk to the fund is that the change in value of futures and
options contracts may not correspond to the change in value of the hedged
instruments. In addition, losses may arise from changes in the value of
the underlying instruments, if there is an illiquid secondary market for
the contracts, or if the counterparty to the contract is unable to
perform. When the contract is closed, the fund records a realized gain or
loss equal to the difference between the value of the contract at the time
it was opened and the value at the time it was closed. Realized gains and
losses on purchased options are included in realized gains and losses on
investment securities.
Futures contracts are valued at the quoted daily settlement prices
established by the exchange on which they trade. Exchange traded options
are valued at the last sale price, or if no sales are reported, the last
bid price for purchased options and the last ask price for written
options. Options traded over-the-counter are valued using prices supplied
by dealers.
D) Federal taxes It is the policy of the fund to distribute all of its
income within the prescribed time and otherwise comply with the provisions
of the Internal Revenue Code applicable to regulated investment companies.
It is also the intention of the fund to distribute an amount sufficient to
avoid imposition of any excise tax under Section 4982 of the Internal
Revenue Code of 1986, as amended. Therefore, no provision has been made
for federal taxes on income, capital gains or unrealized appreciation on
securities held nor for excise tax on income and capital gains.
At April 30, 1998, the fund had a capital loss carryover of approximately
$1,276,826 available to offset future capital gains, if any. The amount of
the carryover and the expiration dates are:
Loss Carryover Expiration
- ----------------- -----------------
$785,019 April 30, 2004
491,807 April 30, 2005
E) Distributions to shareholders Distributions to common and preferred
shareholders are recorded by the fund on the ex-dividend date. Dividends
on remarketed preferred shares become payable when, as and if declared by
the Trustees. Each dividend period for the remarketed preferred shares is
generally a 28 day period. The applicable dividend rate for the remarketed
preferred shares on October 31, 1998 was 3.05%. The amount and character
of income and gains to be distributed are determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. Reclassifications are made to the fund's capital accounts to
reflect income and gains available for distribution (or available capital
loss carryovers) under income tax regulations.
F) Determination of net asset value Net asset value of the common shares
is determined by dividing the value of all assets of the fund, less all
liabilities and the liquidation preference of any outstanding remarketed
preferred shares, by the total number of common shares outstanding.
G) Amortization of bond premium and accretion of bond discount Any premium
resulting from the purchase of securities in excess of maturity value is
amortized on a yield-to-maturity basis. Discounts on original issue
discount bonds are accreted according to the yield to maturity basis.
Note 2
Management fee, administrative
services, and other transactions
Compensation of Putnam Management, for management and investment advisory
services is paid quarterly based on the average net assets of the fund.
Such fee is based on the following annual rates: 0.70% of the first $500
million of weekly average net assets, 0.60% of the next $500 million,
0.55% of the next $500 million, and 0.50% thereafter.
If dividends payable on remarketed preferred shares during any dividend
payment period plus any expenses attributable to remarketed preferred
shares for that period exceed the fund's net income attributable to the
proceeds of the remarketed preferred shares during that period, then the
fee payable to Putnam Management for that period will be reduced by the
amount of the excess (but not more than .70% of the liquidation preference
of the remarketed preferred shares outstanding during the period).
The fund reimburses Putnam Management an allocated amount for the
compensation and related expenses of certain officers of the fund and
their staff who provide administrative services to the fund. The aggregate
amount of all such reimbursements is determined annually by the Trustees.
Custodial functions for the fund's assets are provided by Putnam Fiduciary
Trust Company (PFTC), a subsidiary of Putnam Investments, Inc. Investor
servicing agent functions are provided by Putnam Investor Services, a
division of PFTC.
For the six months ended October 31, 1998, fund expenses were reduced by
$7,598 under expense offset arrangements with PFTC. Investor servicing and
custodian fees reported in the Statement of operations exclude these
credits. The fund could have invested a portion of the assets utilized in
connection with the expense offset arrangements in an income producing
asset if it had not entered into such arrangements.
Each Trustee of the fund receives an annual Trustee fee, of which $400 has
been allocated to the fund, and an additional fee for each Trustee's
meeting attended. Trustees who are not interested persons of Putnam
Management and who serve on committees of the Trustees receive additional
fees for attendance at certain committee meetings.
The fund has adopted a Trustee Fee Deferral Plan (the "Deferral Plan")
which allows the Trustees to defer the receipt of all or a portion of
Trustees Fees payable on or after July 1, 1995. The deferred fees remain
in the fund and are invested in certain Putnam funds until distribution in
accordance with the Deferral Plan.
The fund has adopted an unfunded noncontributory defined benefit pension
plan (the "Pension Plan") covering all Trustees of the fund who have
served as Trustee for at least five years. Benefits under the Pension Plan
are equal to 50% of the Trustee's average total retainer and meeting fees
for the three years preceding retirement. Pension expense for the fund is
included in Compensation of trustees in the Statement of operations.
Accrued pension liability is included in Payable for compensation of
Trustees in the Statement of assets and liabilities.
Note 3
Purchase and sales of securities
During the six months ended October 31, 1998, purchases and sales of
investment securities other than short-term investments aggregated
$8,146,728 and $8,572,438, respectively. There were no purchases and sales
of U.S. government obligations. In determining the net gain or loss on
securities sold, the cost of securities has been determined on the
identified cost basis.
Note 4
Remarketed preferred shares
The Series A shares are redeemable at the option of the fund on any
dividend payment date at a redemption price of $50,000 per share, plus an
amount equal to any dividends accumulated on a daily basis but unpaid
through the redemption date (whether or not such dividends have been
declared) and, in certain circumstances, a call premium.
It is anticipated that dividends paid to holders of remarketed preferred
shares will be considered tax-exempt dividends under the Internal Revenue
Code of 1986. To the extent that the fund earns taxable income and capital
gains by the conclusion of a fiscal year, it will be required to apportion
to the holders of the remarketed preferred shares throughout that year
additional dividends as necessary to result in an after-tax equivalent to
the applicable dividend rate for the period.
Under the Investment Company Act of 1940, the fund is required to maintain
asset coverage of at least 200% with respect to the remarketed preferred
shares as of the last business day of each month in which any such shares
are outstanding. Additionally, the fund is required to meet more stringent
asset coverage requirements under terms of the remarketed preferred shares
and the shares' rating agencies. Should these requirements not be met, or
should dividends accrued on the remarketed preferred shares not be paid,
the fund may be restricted in its ability to declare dividends to common
shareholders or may be required to redeem certain of the remarketed
preferred shares. At October 31, 1998, no such restrictions have been
placed on the fund.
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Fund information
INVESTMENT MANAGER
Putnam Investment
Management, Inc.
One Post Office Square
Boston, MA 02109
MARKETING SERVICES
Putnam Mutual Funds Corp.
One Post Office Square
Boston, MA 02109
CUSTODIAN
Putnam Fiduciary Trust Company
LEGAL COUNSEL
Ropes & Gray
TRUSTEES
George Putnam, Chairman
William F. Pounds, Vice Chairman
John A. Hill, Vice Chairman
Jameson Adkins Baxter
Hans H. Estin
Ronald J. Jackson
Paul L. Joskow
Elizabeth T. Kennan
Lawrence J. Lasser
John H. Mullin III
Robert E. Patterson
Donald S. Perkins
George Putnam, III
A.J.C. Smith
W. Thomas Stephens
W. Nicholas Thorndike
OFFICERS
George Putnam
President
Charles E. Porter
Executive Vice President
Patricia C. Flaherty
Senior Vice President
John D. Hughes
Senior Vice President and Treasurer
Lawrence J. Lasser
Vice President
Gordon H. Silver
Vice President
Ian C. Ferguson
Vice President
Brett C. Browchuk
Vice President
Stephen Oristaglio
Vice President
Jerome J. Jacobs
Vice President
Richard P. Wyke
Vice President and Fund Manager
John R. Verani
Vice President
Beverly Marcus
Clerk and Assistant Treasurer
Call 1-800-225-1581 weekdays from 9 a.m. to 5 p.m. Eastern Time, or
visit our website (www.putnaminv.com) any time for up-to-date
information about the fund's NAV.
[LOGO OMITTED]
PUTNAM INVESTMENTS
The Putnam Funds
One Post Office Square
Boston, Massachusetts 02109
www.putnaminv.com
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PUTNAM
INVESTMENTS
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