- --------------------------------------------------------------------------------
THE BLACKROCK INVESTMENT QUALITY MUNICIPAL TRUST INC.
SEMI-ANNUAL REPORT TO SHAREHOLDERS
REPORT OF INVESTMENT ADVISER
- --------------------------------------------------------------------------------
May 31, 1999
Dear Shareholder:
Since the Trust's last report, interest rates rose sharply as U.S.
economic growth remained strong, labor markets tightened and international
markets began to recover. In light of these factors, on May 18 members of the
Federal Reserve's Federal Open Market Committee announced that they had adopted
a bias towards higher interest rates, citing a concern that inflation might
start to accelerate.
BlackRock has adopted a cautious view of the bond market, as we believe
that there is a real possibility that the Federal Reserve will raise interest
rates in the near future. Additionally, because the Treasury yield curve has
already priced in Federal Reserve action, we believe that interest rates will
trade in a relatively narrow range until the economy shows signs of slowing.
This report contains comments from your Trust's managers regarding the
markets and portfolio in addition to the Trust's financial statements and a
detailed portfolio listing. We thank you for your continued investment in the
Trust.
Sincerely,
/s/ Laurence D. Fink /s/ Ralph L. Schlosstein
- -------------------- ------------------------
Laurence D. Fink Ralph L. Schlosstein
Chairman President
1
<PAGE>
May 31, 1999
Dear Shareholder:
We are pleased to present the semi-annual report for The BlackRock
Investment Quality Municipal Trust Inc. (the "Trust") for the six months ended
April 30, 1999. We would like to take this opportunity to review the Trust's
stock price and net asset value (NAV) performance, summarize developments in
the fixed income markets 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 "BKN". The
Trust's investment objective is to provide high current income that is exempt
from regular Federal income tax consistent with the preservation of capital.
The Trust seeks to achieve this objective by investing in investment grade
(rated "AAA" to "BBB" by a major rating agency or of equivalent quality)
tax-exempt general obligation and revenue bonds issued by city, county and
state municipalities throughout the United States.
The table below summarizes the changes in the Trust's stock price and NAV
over the period:
<TABLE>
<CAPTION>
----------------------------------------------------------------
4/30/99 10/31/98 CHANGE HIGH LOW
<S> <C> <C> <C> <C> <C>
STOCK PRICE $ 15.1875 $ 15.4375 (1.62%) $ 16.0625 $ 14.9375
- ------------------------------------------------------------------------------------------
NET ASSET VALUE (NAV) $ 15.42 $ 15.78 (2.28%) $ 15.79 $ 15.40
- ------------------------------------------------------------------------------------------
</TABLE>
THE FIXED INCOME MARKETS
The past six months have witnessed continued rapid expansion of the U.S.
economy. GDP growth for the first quarter of 1999 is estimated at an annual
rate above 4%, far exceeding the historical non-inflationary level of 2%. While
BlackRock believes that growth may slow down in the second half of 1999, we
anticipate GDP to remain above 3% for the year. Despite the strong economic
growth, inflation has stayed surprisingly subdued. A significant factor in
maintaining low inflation in the U.S. economy stems from the increase in
industrial productivity. Higher productivity has allowed manufacturers to avoid
price increases despite tight labor markets.
The Treasury market briefly rallied early in the fourth quarter of 1998
before dramatically reversing in 1999. For the semi-annual period, the yield of
the 10-year Treasury security rose from 4.61% on October 31, 1998 to 5.35% on
April 30, 1999. The weakened performance of the Treasury market can be
attributed to investors leaving the safe haven of Treasuries to purchase credit
sensitive or higher yielding securities in relation to inflationary concerns
voiced by the Federal Reserve.
Municipal bonds outperformed the taxable domestic bond market during the
past six months, returning 1.55% (as measured by the Lehman Municipal Index)
versus the Lehman Aggregate Index's 0.68% on a pre-tax basis. The main forces
behind municipal bond outperformance were the strongest mutual fund inflows in
five years and the reduction of municipal bond supply (due to higher interest
rates) after the second highest year of issuance ($284 billion issued in 1998.)
We believe that municipals currently offer attractive value versus Treasuries
and our outlook for municipal securities is favorable. Despite recent
outperformance we still feel that the attractive taxable equivalent yields
offered by municipal securities are compelling.
2
<PAGE>
THE TRUST'S PORTFOLIO AND INVESTMENT STRATEGY
The Trust's portfolio is actively managed to diversify exposure to various
sectors, issuers, revenue sources and security types. BlackRock's investment
strategy emphasizes a relative value approach, which allows the Trust to
capitalize upon changing market conditions by rotating municipal sectors,
credits and coupons.
Additionally, the Trust employs leverage to enhance its income by
borrowing at short-term municipal rates and investing the proceeds in longer
maturity issues that have higher yields. The degree to which the Trust can
benefit from its use of leverage may affect its ability to pay high monthly
income. At the end of the semi-annual period, the Trust's leverage amount was
34% of total assets. During the past six months, the Trust's borrowing costs
have remained favorable.
As municipal credit spreads remained tight during the reporting period, we
continued to emphasize higher rated securities over the lower rated investment
grade sector. We believe that credit spreads will return to more historical
levels in the near future and as such the Trust should be rewarded for its
higher credit quality bias. The Trust has continued its bias towards premium
coupon securities over discount priced securities, as premium coupons offer
better price performance during periods of rising interest rates and similar
performance to discounts when interest rates fall.
The following charts compare the Trust's current and October 31, 1998
asset composition and credit quality allocations:
SECTOR BREAKDOWN
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SECTOR APRIL 30, 1999 OCTOBER 31, 1998
- -------------------------------------------------------------------------------
<S> <C> <C>
Transportation 20% 18%
- -------------------------------------------------------------------------------
City, County & State 18% 17%
- -------------------------------------------------------------------------------
Hospital 14% 12%
- -------------------------------------------------------------------------------
Industrial & Pollution Control 9% 13%
- -------------------------------------------------------------------------------
Power 8% 8%
- -------------------------------------------------------------------------------
University/School 7% 7%
- -------------------------------------------------------------------------------
Lease Revenue 6% 6%
- -------------------------------------------------------------------------------
Housing 5% 5%
- -------------------------------------------------------------------------------
Water & Sewer 5% 5%
- -------------------------------------------------------------------------------
Miscellaneous Revenue 3% 1%
- -------------------------------------------------------------------------------
Resource Recovery 2% 2%
- -------------------------------------------------------------------------------
Special District 1% --
- -------------------------------------------------------------------------------
Tax Revenue 1% 6%
- -------------------------------------------------------------------------------
Utility 1% --
- -------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------
CREDIT RATING* APRIL 30, 1999 OCTOBER 31, 1998
- -------------------------------------------------------------------------------
<S> <C> <C>
AAA/Aaa 62% 58%
- -------------------------------------------------------------------------------
AA/Aa 17% 12%
- -------------------------------------------------------------------------------
A/A 12% 15%
- -------------------------------------------------------------------------------
BBB/Baa 9% 15%
- -------------------------------------------------------------------------------
</TABLE>
- ----------
* Using the higher of Standard & Poor's, Moody's or Fitch's rating.
3
<PAGE>
We look forward to continuing to manage the Trust to benefit from the
opportunities available to investors in the investment grade municipal market.
We thank you for your investment and continued interest in The BlackRock
Investment Quality Municipal 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/ Kevin Klingert
- -------------------- -------------------
Robert S. Kapito Kevin Klingert
Vice Chairman and Portfolio Manager Managing Director and Portfolio Manager
BlackRock Financial Management, Inc. BlackRock Financial Management, Inc.
- --------------------------------------------------------------------------------
THE BLACKROCK INVESTMENT QUALITY MUNICIPAL TRUST INC.
- --------------------------------------------------------------------------------
Symbol on New York Stock Exchange: BKN
- --------------------------------------------------------------------------------
Initial Offering Date: February 19, 1993
- --------------------------------------------------------------------------------
Closing Stock Price as of 4/30/99: $ 15.1875
- --------------------------------------------------------------------------------
Net Asset Value as of 4/30/99: $ 15.42
- --------------------------------------------------------------------------------
Yield on Closing Stock Price as of 4/30/99 ($15.1875)1: 5.68%
- --------------------------------------------------------------------------------
Current Monthly Distribution per Share2: $ 0.0719
- --------------------------------------------------------------------------------
Current Annualized Distribution per Share2: $ 0.8628
- --------------------------------------------------------------------------------
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.
4
<PAGE>
- --------------------------------------------------------------------------------
THE BLACKROCK INVESTMENT QUALITY MUNICIPAL TRUST INC.
PORTFOLIO OF INVESTMENTS APRIL 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT OPTION CALL VALUE
RATING* (000) DESCRIPTION PROVISIONS+ (NOTE 1)
====================================================================================================================================
<S> <C> <C> <C> <C>
LONG-TERM INVESTMENTS-147.8%
CALIFORNIA-12.7%
Aa2 $ 1,220 California Hsg. Fin. Agcy. Rev., Home Mtg., Ser. C, 5.65%, 8/01/14 ................. 2/04 at 102 $ 1,259,626
Aa3 5,770 California St. G.O., 5.00%, 10/01/14 ............................................... 10/07 at 101 5,879,688
AAA 15,460 Los Angeles Cnty. Asset Leasing Corp. Rev., 5.95%, 12/01/07, AMBAC ................. No Opt. Call 17,465,935
University of California Rev., Research Fac., Ser. B,
AAA 2,000++ 6.10%, 9/01/03 .................................................................... N/A 2,231,800
AAA 3,305++ 6.20%, 9/01/03 .................................................................... N/A 3,701,170
AAA 2,000++ 6.25%, 9/01/03 .................................................................... N/A 2,243,700
-----------
32,781,919
-----------
COLORADO-13.5%
Arapahoe Cnty. Cap. Impvt. Hwy. Rev., Trust Fund, Ser. E,
AAA 3,100 Zero Coupon, 8/31/04 ............................................................. No Opt. Call 2,506,908
Denver City & Cnty. Arpt. Rev.,
AAA 1,000 Ser. A, 5.60%, 11/15/20, MBIA .................................................... 11/05 at 102 1,041,390
BBB+ 1,120 Ser. C, 6.65%, 11/15/05 .......................................................... 11/02 at 102 1,211,896
BBB+ 3,000 Ser. C, 6.50%, 11/15/06 .......................................................... 11/02 at 102 3,231,660
AAA 3,705++ Ser. D, 7.00%, 11/15/01 .......................................................... N/A 3,989,989
BBB+ 14,085 Ser. D, 7.00%, 11/15/25 .......................................................... 11/01 at 100 14,886,155
E-470 Pub. Hwy. Auth. Rev., Ser. B,
AAA 3,000 Zero Coupon, 9/01/11, MBIA.. ..................................................... No Opt. Call 1,690,710
AAA 10,000 Zero Coupon, 9/01/18, MBIA ....................................................... No Opt. Call 3,661,400
AAA 2,250++ 6.90%, 8/31/05 ................................................................... N/A 2,659,522
-----------
34,879,630
-----------
CONNECTICUT-4.8%
AA 8,750 Connecticut St. G.O., Ser. A, 5.50%, 11/15/08 ..................................... 11/03 at 102 9,371,075
Baa3 3,000 Mashantuchet Western Pequot Tribe, Spl. Rev., 5.50%, 9/01/28 ...................... 9/09 at 101 2,988,180
-----------
12,359,255
-----------
DISTRICT OF COLUMBIA-2.0%
District of Columbia G.O., Ser. E, CAPMAC,
AAA 70++ 6.00%, 6/01/03 ................................................................... N/A 76,791
AAA 1,830 6.00%, 6/01/09 ................................................................... 6/03 at 102 1,960,699
AAA 3,000 Washington D.C. Convention Ctr. Auth. Ded. Tax Rev., 5.25%, 10/01/17, AMBAC ....... 10/08 at 101 3,052,860
-----------
5,090,350
-----------
FLORIDA-4.2%
AAA 1,740 Florida Hsg. Fin. Agcy. Rev., Sngl. Fam. Mtg., Ser. 1994-A, 6.55%, 7/01/14, GNMA .. 1/05 at 102 1,847,271
AA+ 5,000 Florida St. Dept. Trans., Right of Way, Ser. A, 4.75%, 7/01/24 .................... 7/09 at 101 4,726,650
BBB 4,000 Santa Rosa Bay Bridge Auth. Rev., 6.25%, 7/01/28 .................................. 7/06 at 102 4,356,120
-----------
10,930,041
-----------
GEORGIA-1.5%
A 3,000 Burke Cnty. Dev. Auth. P.C.R., Pwr. Co., Plant Vogtle, 3rd Ser., 5.45%, 5/01/34 ... 5/04 at 102 2,973,030
AAA 920 Georgia St. Hsg. & Fin. Auth. Rev., Sngl. Fam. Mtg., Ser. C, 7.00%, 12/01/15, FHA.. 6/99 at 100 981,180
-----------
3,954,210
-----------
ILLINOIS-9.7%
AAA 2,500 Chicago Waste Wtr. Transmission Rev., 5.125%, 1/01/25, FGIC . ..................... 1/06 at 102 2,446,025
AAA 5,050 Chicago Wtr. Rev., 5.25%, 11/01/23, FGIC. ......................................... 11/07 at 102 5,063,887
AAA 3,000++ Cook Cnty. Cap. Impt. 5.875%, 11/15/06, FGIC ...................................... N/A 3,347,460
AAA 4,165 Cook Cnty. G.O., Ser. A, 5.20%, 11/15/08, MBIA .................................... 11/07 at 101 4,436,808
Illinois Edl. Fac. Auth. Rev., Loyola Univ., FGIC,
AAA 5,000++ 5.70%, 7/01/05 ................................................................... N/A 5,335,100
AAA 4,000 5.45%, 7/01/14 ................................................................... 7/03 at 102 4,230,440
-----------
24,859,720
-----------
INDIANA-3.3%
BBB 7,595 Indianapolis Arpt. Auth. Rev., Spl. Fac. Fed. Express Corp. Proj., 7.10%, 1/15/17.. 7/04 at 102 8,501,919
-----------
KENTUCKY-7.4%
AAA 2,850 Boone Cnty. P.C.R., 5.50%, 1/01/24, MBIA .......................................... 1/04 at 102 2,937,466
AAA 15,000 Kentucky St. Tpke. Auth., Econ. Dev. Road Rev., 5.75%, 7/01/13, AMBAC ............. 7/03 at 102 16,051,350
-----------
18,988,816
-----------
</TABLE>
See Notes to Financial Statements.
5
<PAGE>
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL
AMOUNT OPTION CALL VALUE
RATING* (000) DESCRIPTION PROVISIONS+ (NOTE 1)
=================================================================================================================================
<S> <C> <C> <C> <C>
LOUISIANA-7.4%
AAA $14,400++ Louisiana Pub. Fac. Auth. Hosp. Rev., Our Lady of the Lake Regl. Med. Ctr.,
5.90%, 12/01/03, FSA ................................................................. N/A $15,893,856
AAA 2,860++ Louisiana Stadium & Expo Dist., Htl. Ocpcy. Tax, 6.00%, 7/01/06, FGIC .................. N/A 3,221,418
-----------
19,115,274
-----------
MARYLAND-5.4%
Aa2 9,940 Maryland St. Dept. Hsg. & Comn. Dev. Admin., Sngl. Fam. Prog., Ser. 2, 6.55%, 4/01/26.. 4/05 at 102 10,604,986
AAA 3,175 Northeast Waste Disp. Auth. Rev., Sld. Wst., Montgomery Cnty. Res. Rec. Proj., Ser. A,
6.30%, 7/01/16, MBIA ................................................................. 7/03 at 102 3,427,920
-----------
14,032,906
MASSACHUSETTS-2.5% -----------
AAA 6,500 Massachusetts St. Hlth. & Edl. Fac. Auth. Rev., Hallmark Hlth. Sys., Ser. A, 5.00%,
7/01/21, FSA ......................................................................... 7/08 at 101 6,304,935
-----------
4,000 MICHIGAN-3.8%
AAA Greater Detroit Res. Rec. Auth. Rev., Ser. A, 6.25%, 12/13/08, AMBAC .................. No Opt. Call 4,555,960
AAA 5,000 River Rouge Sch. Dist., 5.625%, 5/01/22, FSA .......................................... 5/03 at 101.50 5,247,350
-----------
9,803,310
MISSOURI-1.7% -----------
Lake of the Ozarks Cmnty. Brdg. Corp., Brdg. Sys. Rev.,
NR 2,000 5.25%, 12/01/14 ...................................................................... 12/08 at 102 1,994,920
NR 2,500 5.25%, 12/01/26 ...................................................................... 12/08 at 102 2,457,800
-----------
4,452,720
NEVADA-1.6% -----------
AAA 3,750 Washoe Cnty. Arpt. Auth., Arpt. Sys. Impvt. Rev., Ser. B, 5.80%, 7/01/09, MBIA ........ 7/03 at 102 4,000,612
-----------
NEW YORK-26.2%
AAA 5,400 Metropolitan Trans. Auth. Commuter Fac. Rev., Ser. A, 5.75%, 7/01/21, MBIA ............ 7/07 at 101.50 5,824,980
New York City G.O.,
A 4,140 Ser. A, 6.00%, 8/01/05 ............................................................... No Opt. Call 4,525,517
AAA 3,000 Ser. D, 5.60%, 11/01/05, AMBAC. ...................................................... No Opt. Call 3,246,810
A 7,000 Ser. E, 6.50%, 2/15/06 ............................................................... No Opt. Call 7,861,560
A 6,160++ Ser. H, 7.20%, 2/01/02 ............................................................... N/A 6,801,441
A 840 Ser. H, 7.20%, 2/01/13 ............................................................... 2/02 at 101.50 915,272
New York City Ind. Dev. Agcy. Spec. Fac. Rev., Term. One Group Assoc. Proj.,
A 4,000 6.00%, 1/01/08 ....................................................................... 1/04 at 102 4,293,480
A 1,000 6.00%, 1/01/15 ....................................................................... 1/04 at 102 1,064,250
AAA 9,375 New York City Mun. Wtr. Fin. Auth., Wtr. & Swr. Rev., Ser. A, 5.125%, 6/15/22, AMBAC ... 6/07 at 101 9,366,094
AA+ 4,000 New York City Transitional Fin. Auth. Rev., Ser. C, 4.75%, 5/01/23 ..................... 5/08 at 102 3,739,440
AAA 3,000++ New York St. Dorm. Auth. Rev., St. Univ. Edl. Fac., Ser. B, 6.10%, 5/15/04. ............ N/A 3,353,910
A- 1,955 New York St. Hsg. Fin. Agcy., Hlth. Fac. of New York City, Ser. A, 6.375%, 11/01/04 .... No Opt. Call 2,155,036
AAA 5,000++ New York St. Med. Care Fac. Rev., Hosp., Ser. A, 6.60%, 2/15/05, AMBAC ................. N/A 5,741,100
AAA 5,550 New York St. Twy. Auth., Svc. Contract Rev., Ser. B, 5.375%, 4/01/14, MBIA ............. 4/08 at 101 5,824,725
AAA 2,620 New York St. Urban Dev. Corp. Rev., Correctional Fac., 5.625%, 1/01/07, AMBAC .......... 1/03 at 102 2,792,003
-----------
67,505,618
-----------
NORTH CAROLINA-2.3%
AAA 5,000 North Carolina Eastn. Mun. Pwr. Agcy. Rev., Ser. B, 7.00%, 1/01/08, CAPMAC ............. No Opt. Call 5,901,000
-----------
OHIO-0.7%
NR 500 Cleveland Cuyahoga Cnty. Port Auth. Rev., Port Dev. Proj., 6.00%, 3/01/07 .............. No Opt. Call 518,935
AAA 1,220 Ohio St. Higher Edl. Fac. Com., Univ. Dayton Proj., 5.35%, 12/01/17, AMBAC ............. 12/07 at 101 1,266,592
-----------
1,785,527
OREGON-2.2% -----------
NR 5,600 Klamath Falls Oregon Elec. Rev., Sr. Lien-Klamath Cogen, 5.50%, 1/01/07 ................ No Opt. Call 5,620,272
-----------
PENNSYLVANIA-14.0%
AAA 6,000 Delaware Valley Regl. Fin. Auth., Ser. A, 5.50%, 8/01/28, AMBAC ........................ No Opt. Call 6,421,440
AAA 10,100 Lehigh Cnty. Gen. Purpose Auth., Rev., St. Lukes Hosp. Bethlehem Proj.,
7,000 5.50%, 11/15/13, AMBAC ............................................................... 11/03 at 102 10,542,683
AAA 4,000 Montgomery Cnty. Ed. & Hlth. Care Auth., Holy Redeemer, 5.25%, 10/01/23, AMBAC ......... 10/07 at 101 7,080,500
AAA 1,500 Pennsylvania Intergovernmental Coop. Auth., Spl. Tax Rev., Philadelphia Fdg. Prog.,
5.50%, 6/15/20, FGIC... .............................................................. 6/06 at 100 4,142,280
AAA Pennsylvania St. G.O., First Ser., 5.375%, 5/15/09, FGIC ............................... 5/06 at 101.50 1,601,325
Pennsylvania St. Higher Edl. Fac. Auth., Hlth. Svcs. Rev.,
AA 2,750 Ser. A, 5.875% 1/01/15 ............................................................... 1/06 at 101 2,894,568
AA 3,300 Ser. A, 5.75%, 1/01/17 ............................................................... 1/06 at 101 3,461,865
-----------
36,144,661
-----------
</TABLE>
See Notes to Financial Statements.
6
<PAGE>
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
PRINCIPAL
AMOUNT OPTION CALL VALUE
RATING* (000) DESCRIPTION PROVISIONS+ (NOTE 1)
===================================================================================================================================
<S> <C> <C>
RHODE ISLAND-2.2%
AA+ $3,430 Rhode Island Hsg. & Mtg. Fin., Homeownership Oppty., Ser. 15-B, 6.75%, 10/01/17 .... 4/04 at 102 $ 3,657,443
AAA 2,000 Rhode Island St. Hlth. & Edl. Bldg. Corp. Rev., Hosp. Fin., 5.50%, 5/15/16, MBIA ... 5/07 at 102 2,094,880
-------------
TENNESSEE - 3.3%
A 7,800 Maury Cnty. Ind. Dev. Brd., P.C.R., Saturn Corp. Proj., 6.50%, 9/01/24 ............. 9/04 at 102 8,589,048
TEXAS- 1.1%
A- 2,640 Sabine River Auth., P.C.R., Coll-Texas Utilities Elec. Proj., Ser. B,
8.25%, 10/01/20 10/00 at 102 2,822,424
UTAH-2.4%
A+ 1,800 Intermountain Pwr. Agcy. Rev., Fst. Crossover, Ser. 86 B, 5.00%, 7/01/16 ........... 6/99 at 100 1,751,112
AAA 4,450 Intermountain Pwr. Agcy. Rev., Pwr. Supply, Ser. F, 5.00%, 7/01/13, AMBAC .......... 6/99 at 100 4,450,267
------------
WASHINGTON-11.9%
AA 6,900 Seattle G.O., 5.40%, 1/01/08 ....................................................... 1/03 at 102 7,293,645
AA 2,650 Seattle Wtr. Sys. Rev., 5.50%, 6/01/18 ............................................. 6/03 at 102 2,702,708
AA+ 4,000 Washington St. G.O., Ser. A, 5.375%, 7/01/21 ....................................... 7/06 at 100 4,091,280
Washington St. Pub. Pwr. Supply Sys. Rev.,
AAA 13,395 Nuclear Proj. No. 1, 5.75%, 7/01/11, MBIA ......................................... 7/06 at 102 14,466,868
AAA 2,000 Nuclear Proj. No. 2, 5.55%, 7/01/10, FGIC ......................................... 7/03 at 102 2,115,660
------------
Total Long-Term Investments (cost $357,158,166)..................................... 381,048,030
------------
SHORT-TERM INVESTMENTS**-1.2%
MISSOURI-0.4%
Aa2 900 Jackson Cnty. P.C.R., 4.25%, 5/03/99, FRDD ......................................... N/A 900,000
------------
WASHINGTON-0.8%
Washington St. Hlth. Care Fac. Auth. Rev., Sisters of Prov., FRDD,
AA- 700 Ser. B, 4.25%, 5/03/99 ............................................................ N/A 700,000
AA- 1,400 Ser. D, 4.25%, 5/03/99 ............................................................ N/A 1,400,000
------------
2,100,000
------------
Total Short-Term Investments (cost $3,000,000)....................................... 3,000,000
------------
TOTAL INVESTMENTS-149.0% (COST $360,158,166) ........................................ 384,048,030
Other assets in excess of liabilities - 1.4% ........................................ 3,642,439
Liquidation value of preferred stock-(50.4)% ........................................ (130,000,000)
------------
NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS-100% .................................. $257,690,469
============
</TABLE>
- ----------
* Rating: Using the higher of Standard & Poor's, Moody's or Fitch's rating.
** For purposes of amortized cost valuation, the maturity date of these
instruments is considered to be the later of the next date on which the
security can be redeemed at par or the next date on which the rate of
interest is adjusted.
+ Option call provisions: date (month/year) and price of the earliest call or
redemption. There may be other call provisions at varying prices at later
dates.
++ This bond is prerefunded. See glossary for definition.
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
THE FOLLOWING ABBREVIATIONS ARE USED IN PORTFOLIO DESCRIPTIONS
<S> <C> <C> <C>
AMBAC -- American Municipal Bond Assurance Corporation FSA -- Financial Security Assurance
CAPMAC -- Capital Markets Assurance Corporation GNMA -- Government National Mortgage Association
FGIC -- Financial Guaranty Insurance Company G.O. -- General Obligation Bond
FHA -- Federal Housing Administration MBIA -- Municipal Bond Insurance Association
FRDD -- Floating Rate Daily Demand P.C.R. -- Pollution Control Revenue
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
7
<PAGE>
- --------------------------------------------------------------------------------
THE BLACKROCK INVESTMENT
QUALITY MUNICIPAL TRUST INC.
STATEMENT OF ASSETS AND LIABILITIES
APRIL 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS
Investments, at value (cost $360,158,166) (Note 1) . $384,048,030
Cash ................................................. 467,459
Interest receivable .................................. 6,576,099
Other assets ......................................... 9,515
------------
391,101,103
------------
LIABILITIES
Payable for investments purchased .................... 2,988,291
Investment advisory fee payable (Note 2) ............. 112,527
Administration fee payable (Note 2) .................. 48,226
Dividends payable-preferred stock .................... 37,290
Other accrued expenses ............................... 224,300
------------
3,410,634
------------
NET INVESTMENT ASSETS ................................ $387,690,469
============
Net investment assets were comprised of:
Common stock:
Par value (Note 4) ................................. $ 167,071
Paid-in capital in excess of par ................... 232,077,765
Preferred stock (Note 4) ............................ 130,000,000
------------
362,244,836
Undistributed net investment income ................. 1,635,168
Accumulated net realized loss ....................... (79,399)
Net unrealized appreciation ......................... 23,889,864
------------
Net investment assets, April 30, 1999 ................ $387,690,469
============
Net assets applicable to common shareholders ......... $257,690,469
============
Net asset value per common share:
($257,690,469 o 16,707,093 shares of
common stock issued and outstanding) ............... $15.42
======
</TABLE>
- --------------------------------------------------------------------------------
THE BLACKROCK INVESTMENT
QUALITY MUNICIPAL TRUST INC.
STATEMENT OF OPERATIONS
SIX MONTHS ENDED APRIL 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
NET INVESTMENT INCOME
Income
Interest and discount earned ........... $10,493,252
-----------
Expenses
Investment advisory .................... 680,772
Administration ......................... 291,759
Auction agent .......................... 171,000
Custodian .............................. 41,500
Reports to shareholders ................ 36,500
Directors .............................. 29,000
Audit .................................. 19,000
Transfer agent ......................... 12,500
Legal .................................. 4,000
Miscellaneous .......................... 19,083
-----------
Total expenses ......................... 1,305,114
-----------
Net investment income .................... 9,188,138
-----------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS (NOTE 3)
Net realized gain on investments ......... 1,719
Net change in unrealized appreciation
on investments ......................... (2,878,921)
-----------
Net loss on investments .................. (2,877,202)
-----------
NET INCREASE IN NET INVESTMENT ASSETS
RESULTING FROM OPERATIONS ................ $ 6,310,936
===========
</TABLE>
See Notes to Financial Statements.
8
<PAGE>
- --------------------------------------------------------------------------------
THE BLACKROCK INVESTMENT QUALITY MUNICIPAL TRUST INC.
STATEMENTS OF CHANGES IN NET INVESTMENT ASSETS (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS YEAR
ENDED APRIL 30, ENDED
1999 OCTOBER 31, 1998
----------------- -----------------
INCREASE (DECREASE) IN NET INVESTMENT ASSETS
<S> <C> <C>
Operations:
Net investment income ................................................... $ 9,188,138 $ 18,032,133
Net realized gain on investments ........................................ 1,719 3,208,243
Net change in unrealized appreciation (depreciation) on investments ..... (2,878,921) 8,422,329
------------- -------------
Net increase in net investment assets resulting from operations ......... 6,310,936 29,662,705
Dividends and distributions:
To common shareholders from net investment income ....................... (7,207,157) (13,554,216)
To common shareholders from net realized gain on investments ............ (2,504,280) (3,343,299)
To preferred shareholders from net investment income .................... (1,795,094) (3,967,577)
To preferred shareholders from net realized gain on investments ......... (703,888) (1,133,378)
------------- -------------
Total dividends and distributions ....................................... (12,210,419) (21,998,470)
------------- -------------
Total increase (decrease) .............................................. (5,899,483) 7,664,235
NET INVESTMENT ASSETS
Beginning of period ...................................................... 393,589,952 385,925,717
------------- -------------
End of period ............................................................ $ 387,690,469 $ 393,589,952
============= =============
</TABLE>
See Notes to Financial Statements.
9
<PAGE>
- --------------------------------------------------------------------------------
THE BLACKROCK INVESTMENT QUALITY MUNICIPAL TRUST INC.
FINANCIAL HIGHLIGHTS (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS ENDED
APRIL 30,
1999
----------------------
<S> <C>
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of period ............................... $ 15.78
-----------
Net investment income ............................................. .55
Net realized and unrealized gain (loss) on investments ............ (.18)
-----------
Net increase (decrease) from investment operations ................. .37
-----------
Dividends and distributions:
Dividends from net investment income to:
Common shareholders .............................................. (.43)
Preferred shareholders ........................................... (.11)
Distributions from net realized gain on investments to:
Common shareholders .............................................. (.15)
Preferred shareholders ........................................... (.04)
-----------
Total dividends and distributions .............................. (.73)
-----------
Capital charge with respect to issuance of common and
preferred shares .................................................. --
-----------
Net asset value, end of period* .................................... $ 15.42
===========
Per share market value, end of period* ............................. $ 15.19
===========
TOTAL INVESTMENT RETURN+ .......................................... 2.09%
===========
RATIOS TO AVERAGE NET ASSETS OF COMMON
SHAREHOLDERS:++
Expenses ........................................................... 1.01%+++
Net investment income before preferred stock dividends ............. 7.13%+++
Preferred stock dividends .......................................... 1.39%+++
Net investment income available to common shareholders ............. 5.74%+++
SUPPLEMENTAL DATA:
Average net assets of common shareholders (in thousands) ........... $ 259,970
Portfolio turnover ................................................. 20%
Net assets of common shareholders, end of period (in thousands)..... $ 257,690
Preferred stock outstanding (in thousands) ......................... $ 130,000
Asset coverage per share of preferred stock, end of period# ........ $ 74,566
<CAPTION>
YEAR ENDED OCTOBER 31,
----------------------------------------------------
1998 1997 1996 1995
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of period ............................... $ 15.32 $ 14.52 $ 14.18 $ 12.05
------- ------- ------- --------
Net investment income ............................................. 1.08 1.08 1.09 1.10
Net realized and unrealized gain (loss) on investments ............ .70 .80 .34 2.16
------- ------- ------- --------
Net increase (decrease) from investment operations ................. 1.78 1.88 1.43 3.26
------- ------- ------- --------
Dividends and distributions:
Dividends from net investment income to:
Common shareholders .............................................. (.81) (.78) (.79) (.82)
Preferred shareholders ........................................... (.24) (.27) (.28) (.31)
Distributions from net realized gain on investments to:
Common shareholders .............................................. (.20) (.02) (.01) --
Preferred shareholders ........................................... (.07) (.01) (.01) --
-------- -------- -------- --------
Total dividends and distributions .............................. (1.32) (1.08) (1.09) (1.13)
-------- -------- -------- --------
Capital charge with respect to issuance of common and
preferred shares .................................................. -- -- -- --
-------- -------- -------- --------
Net asset value, end of period* .................................... $ 15.78 $ 15.32 $ 14.52 $ 14.18
======== ======== ======== ========
Per share market value, end of period* ............................. $ 15.44 $ 13.38 $ 12.44 $ 12.00
======== ======== ======== ========
TOTAL INVESTMENT RETURN+ .......................................... 23.81% 14.39% 10.41% 24.01%
======== ======== ======== ========
RATIOS TO AVERAGE NET ASSETS OF COMMON
SHAREHOLDERS:++
Expenses ........................................................... 1.04% 1.07% 1.12% 1.16%
Net investment income before preferred stock dividends ............. 6.95% 7.42% 7.57% 8.36%
Preferred stock dividends .......................................... 1.53% 1.88% 1.97% 2.34%
Net investment income available to common shareholders ............. 5.42% 5.54% 5.60% 6.02%
SUPPLEMENTAL DATA:
Average net assets of common shareholders (in thousands) ........... $259,280 $243,947 $238,540 $219,740
Portfolio turnover ................................................. 46% 160% 164% 182%
Net assets of common shareholders, end of period (in thousands)..... $263,590 $255,926 $242,547 $236,990
Preferred stock outstanding (in thousands) ......................... $130,000 $130,000 $130,000 $130,000
Asset coverage per share of preferred stock, end of period# ........ $ 75,690 $ 74,241 $ 71,644 $ 70,575
<CAPTION>
1994
-----------
<S> <C>
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of period ............................... $ 14.76
--------
Net investment income ............................................. 1.06
Net realized and unrealized gain (loss) on investments ............ (2.64)
--------
Net increase (decrease) from investment operations ................. (1.58)
--------
Dividends and distributions:
Dividends from net investment income to:
Common shareholders .............................................. (.90)
Preferred shareholders ........................................... (.21)
Distributions from net realized gain on investments to:
Common shareholders .............................................. --
Preferred shareholders ........................................... --
--------
Total dividends and distributions .............................. (1.11)
--------
Capital charge with respect to issuance of common and
preferred shares .................................................. (.02)
--------
Net asset value, end of period* .................................... $ 12.05
========
Per share market value, end of period* ............................. $ 10.38
=========
TOTAL INVESTMENT RETURN+ .......................................... (20.98%)
========
RATIOS TO AVERAGE NET ASSETS OF COMMON
SHAREHOLDERS:++
Expenses ........................................................... 1.14%
Net investment income before preferred stock dividends ............. 7.80%
Preferred stock dividends .......................................... 1.55%
Net investment income available to common shareholders ............. 6.25%
SUPPLEMENTAL DATA:
Average net assets of common shareholders (in thousands) ........... $226,935
Portfolio turnover ................................................. 210%
Net assets of common shareholders, end of period (in thousands)..... $201,343
Preferred stock outstanding (in thousands) ......................... $130,000
Asset coverage per share of preferred stock, end of period# ........ $127,440
</TABLE>
- ----------
* Net asset value and market value are published in THE WALL STREET JOURNAL
each Monday.
# A stock split occurred on July 24, 1995 (Note 4).
+ 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 the period reported. Dividends and
distributions, if any, are assumed for purposes of this calculation, to be
reinvested at prices obtained under the Trust's dividend reinvestment plan.
Total investment return does not reflect brokerage commissions. Total
investment returns for periods of less than one year are not annualized.
++ Ratios are calculated on the basis of income and expenses applicable to
both the common and preferred stock relative to the average net assets of
common shareholders. Ratios do not reflect the effect of dividend payments
to preferred shareholders.
+++Annualized.
The information above represents the unaudited operating performance for a
share of common stock outstanding, total investment return, ratios to average
net assets and other supplemental data for the periods 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.
10
<PAGE>
- --------------------------------------------------------------------------------
THE BLACKROCK INVESTMENT
QUALITY MUNICIPAL TRUST INC.
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
- --------------------------------------------------------------------------------
NOTE 1. ORGANIZATION & The BlackRock Invest-
ACCOUNTING ment Quality Municipal
POLICIES Trust Inc. (the "Trust")
was organized in Mary-
land on November 19, 1992 as a diversified, closed-end management investment
company. The Trust's investment objective is to manage a portfolio of high
quality securities while providing high current income exempt from regular
Federal income tax consistent with the preservation of capital. 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: Municipal securities (including commitments to purchase
such securities on a "when-issued" basis) are valued on the basis of prices
provided by a pricing service 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 values. 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 which mature in more than 60 days are valued at
current market quotations. Short-term securities which mature in 60 days or
less are valued at amortized cost, if their term to maturity from date of
purchase is 60 days or less, or by amortizing their value on the 61st day prior
to maturity, if their original term to maturity from date of purchase exceeded
60 days.
SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities transactions are
recorded on 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 original issue discount or amortizes premium on
securities purchased using the interest method.
FEDERAL INCOME 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 net income to shareholders. For this
reason and because substantially all of the Trust's gross income consists of
tax-exempt interest, no Federal income tax provision is required.
DIVIDENDS AND DISTRIBUTIONS: The Trust declares and pays dividends and
distributions to common shareholders monthly from net investment income, net
realized short-term capital gains and other sources, if necessary. Net
long-term capital gains, if any, in excess of loss carryforwards may be
distributed annually. Dividends and distributions are recorded on the
ex-dividend date. Dividends and distributions to preferred shareholders are
accrued and determined as described in Note 4.
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 "Adviser"), a
wholly-owned corporate subsidiary of BlackRock Advisors, Inc., which is an
indirect majority-owned subsidiary of PNC Bank, N.A., and an Administration
Agreement with Princeton Administrators, L.P. (the "Administrator"), an indirect
wholly-owned subsidiary of Merrill Lynch & Co., Inc.
The investment fee paid to the Adviser is computed weekly and payable
monthly at an annual rate of 0.35% of the Trust's average weekly net investment
assets. The administration fee paid to the Administrator is also computed weekly
and payable monthly at an annual rate of 0.15% of the Trust's average weekly net
investment assets.
Pursuant to the agreements, the Adviser provides continuous supervision of
the investment portfolio and pays the compensation of officers of the Trust who
are affiliated persons of the Adviser. The Administrator pays occupancy and
certain clerical and accounting costs of the Trust. The Trust bears all other
costs and expenses.
NOTE 3. Purchases and sales of invest-
PORTFOLIO ment securities, other than
SECURITIES short-term investments, for the
period ended April 30, 1999, aggregated $78,431,539 and $81,362,169,
respectively.
The federal income tax basis of the Trust's investments at April 30, 1999
was $360,239,387, and accordingly, net unrealized appreciation was $23,808,643
(gross unrealized appreciation-$23,950,863, gross unrealized
depreciation-$142,220). HERE IT IS(gross unrealized appreciation-$23,950,863,
gross unrealized depreciation-$142,220).
11
<PAGE>
NOTE 4. CAPITAL There are 200 million shares
of $.01 par value common
stock authorized. Of the 16,707,093 common shares outstanding at April 30, 1999,
the Adviser owned 7,205 shares. As of April 30, 1999, there were 5,200 shares of
Preferred Stock outstanding as follows: Series T7-2,600 and Series T28-2,600.
The Trust may classify or reclassify any unissued shares of common stock
into one or more series of preferred stock. On April 1, 1993, the Trust
reclassified 2,600 shares of common stock and issued 2 series of Auction Market
Preferred Stock ("Preferred Stock") as follows: Series T7-1,300 shares, Series
T28-1,300 shares. The Preferred Stock had a liquidation value of $50,000 per
share plus any accumulated but unpaid dividends. On May 16, 1995 shareholders
approved a proposal to split each share of the Trust's Auction Market Preferred
Stock into two shares and simultaneously reduce each share's liquidation
preference from $50,000 to $25,000 per share plus any accumulated but unpaid
dividends. The stock split occurred on July 24, 1995.
Dividends on Series T7 are cumulative at a rate which is reset every 7
days based on the results of an auction. Dividends on Series T28 are also
cumulative at a rate which is reset every 28 days based on the results of an
auction. Divi-dend rates ranged from 2.95% to 6.00% during the six months ended
April 30, 1999.
The Trust may not declare dividends or make other distributions on shares
of common stock or purchase any such shares if, at the time of the declaration,
distribution, or purchase, asset coverage with respect to the outstanding
Preferred Stock would be less than 200%.
The Preferred Stock is redeemable at the option of the Trust, in whole or
in part, on any dividend payment date at $25,000 per share plus any accumulated
or unpaid dividends whether or not declared. The Preferred Stock is also
subject to mandatory redemption at $25,000 per share plus any accumulated or
unpaid dividends, whether or not declared, if certain requirements relating to
the composition of the assets and liabilities of the Trust as set forth in the
Articles of Incorporation are not satisfied.
The holders of Preferred Stock have voting rights equal to the holders of
common stock (one vote per share) and will vote together with holders of shares
of common stock as a single class. However, holders of Preferred Stock are also
entitled to elect two of the Trust's directors. In addition, the Investment
Company Act of 1940 requires that, along with approval by stockholders that
might otherwise be required, the approval of the holders of a majority of any
outstanding preferred shares, voting separately as a class would be required to
(a) adopt any plan of reorganization that would adversely affect the preferred
shares, and (b) take any action requiring a vote of security holders,
including, among other things, changes in the Trust's subclassification as a
closed-end investment company or changes in its fundamental investment
restrictions.
NOTE 5. DIVIDENDS Subsequent to April 30, 1999,
AND DISTRIBUTIONS 1999, the Board of Directors
of the Trust declared a dividend from undistributed earnings of $0.0719 per
common share payable May 28, 1999, to shareholders of record on May 14, 1999.
For the period May 1, 1999 through May 31, 1999, dividends declared on
Preferred Stock totalled $368,907 in aggregate for the two outstanding
Preferred Stock series.
12
<PAGE>
- --------------------------------------------------------------------------------
THE BLACKROCK INVESTMENT QUALITY MUNICIPAL TRUST INC.
DIVIDEND REINVESTMENT PLAN
- --------------------------------------------------------------------------------
Pursuant to the Trust's Dividend Reinvestment Plan (the "Plan"),
shareholders are automatically enrolled 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 elect not to
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 American
Stock Exchange or elsewhere for the participants' accounts. The Trust will not
issue any new shares under 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 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 income tax 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 address is on the front of this report.
13
<PAGE>
- --------------------------------------------------------------------------------
THE BLACKROCK INVESTMENT QUALITY MUNICIPAL TRUST INC.
ADDITIONAL INFORMATION
- --------------------------------------------------------------------------------
YEAR 2000 READINESS DISCLOSURE. The Trust is currently in the process of
evaluating its information technology infrastructure for Year 2000 compliance.
Substantially all of the Trust's information systems are supplied by the
Adviser. The Adviser has advised the Trust that it is currently evaluating
whether such systems are year 2000 compliant and that it expects to incur costs
of up to approximately five hundred thousand dollars to complete such
evaluation and to make any modifications to its systems as may be necessary to
achieve Year 2000 compliance. The Adviser has advised the Trust that it has
fully tested its systems for Year 2000 compliance. The Trust may be required to
bear a portion of such cost incurred by the Adviser in this regard. The Adviser
has advised the Trust that it does not anticipate any material disruption in
the operations of the Trust as a result of any failure by the Adviser to
achieve Year 2000 compliance. There can be no assurance that the costs will not
exceed the amount referred to above or that the Trust will not experience a
disruption in operations.
The Adviser has advised the Trust that it is in the process of evaluating
the Year 2000 compliance of various suppliers of the Adviser and the Trust. The
Adviser has advised the Trust that it has communicated with such suppliers to
determine their Year 2000 compliance status and the extent to which the Adviser
or the Trust could be affected by any supplier's Year 2000 compliance issues.
To date, the Adviser has received responses from all such suppliers with
respect to their Year 2000 compliance, and there can be no assurance that the
systems of such suppliers, who are beyond the Trust's control, will be Year
2000 compliant. In the event that any of the Trust's significant suppliers do
not successfully and timely achieve Year 2000 compliance, the Trust's business
or operations could be adversely affected. The Adviser has advised the Trust
that it is in the process of preparing a contingency plan for Year 2000
compliance by its suppliers. There can be no assurance that such contingency
plan will be successful in preventing a disruption of the Trust's operations.
The Trust is designating this disclosure as its Year 2000 readiness
disclosure for all purposes under the Year 2000 Information and Readiness
Disclosure Act and the foregoing information shall constitute a Year 2000
statement for purposes of that Act.
ANNUAL MEETING OF TRUST SHAREHOLDERS. 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.
The Annual Meeting of Trust Shareholders was held May 19, 1999 to vote on
the following matters:
(1) To elect three Directors as follows:
<TABLE>
<CAPTION>
DIRECTOR CLASS TERM EXPIRING
- ------------------------------------------------------ ------- --------- ---------
<S> <C> <C> <C>
Andrew F. Brimmer ............................... III 3 years 2002
Kent Dixon ...................................... III 3 years 2002
Laurence D. Fink ................................ III 3 years 2002
Directors whose term of office continues beyond this meeting are Richard E.
Cavanagh, James Grosfeld, Frank J. Fabozzi, James Clayburn La Force, Jr.,
Walter F. Mondale and Ralph L. Schlosstein.
</TABLE>
(2) To ratify the selection of Deloitte & Touche LLP as independent public
accountants of the Trust for the fiscal year ending October 31, 1999.
Shareholders elected the three Directors and ratified the selection of
Deloitte & Touche LLP. The results of the voting was as follows:
<TABLE>
<CAPTION>
VOTES FOR VOTES AGAINST ABSTENTIONS
------------ --------------- ------------
<S> <C> <C> <C>
Andrew F. Brimmer .............................. 13,908,729 -- 245,503
Kent Dixon ..................................... 13,911,170 -- 243,062
Laurence D. Fink ............................... 13,911,556 -- 242,676
Ratification of Deloitte & Touche LLP .......... 13,941,881 41,041 171,310
</TABLE>
14
<PAGE>
- --------------------------------------------------------------------------------
THE BLACKROCK INVESTMENT QUALITY MUNICIPAL TRUST INC.
INVESTMENT SUMMARY
- --------------------------------------------------------------------------------
THE TRUST'S INVESTMENT OBJECTIVE
The BlackRock Investment Quality Municipal Trust's investment objective is to
provide high current income exempt from regular Federal income tax consistent
with the preservation of capital.
WHO MANAGES THE TRUST?
BlackRock Financial Management, Inc. ("BlackRock") is an SEC-registered
investment adviser. BlackRock and its affiliates currently manage over $141
billion on behalf of taxable and tax-exempt clients worldwide. Strategies
include fixed income, equity and cash and may incorporate both domestic and
international securities. Domestic fixed income strategies utilize the
government, mortgage, corporate and municipal bond sectors. BlackRock manages
twenty-one closed-end funds that are traded on either the New York or American
stock exchanges, and a $25 billion family of open-end equity and bond funds.
Current accounts number over 450, domiciled in the United States and overseas.
WHAT CAN THE TRUST INVEST IN?
Under normal conditions, the Trust expects to continue to manage its assets so
that at least 80% of its investments are rated at least investment grade ("BBB"
by Standard & Poor's or "Baa" by Moody's Investor Services) and up to 20% of
its assets may instead be deemed to be of equivalent credit quality by the
Adviser. Examples of the types of securities that the Trust may invest in
include general obligation bonds, which are backed by the full taxing power of
the municipality (states, counties and cities), and revenue bonds, which are
backed by a revenue source associated with the issuing municipality or by a
special tax. Revenue bonds include those that are backed by revenues generated
by universities, hospitals, housing developments, utilities, public facilities,
toll roads, airports, etc.
WHAT IS THE ADVISER'S INVESTMENT STRATEGY?
The Adviser will manage the assets of the Trust in accordance with the Trust's
investment objective and policies to seek to achieve its objective by investing
in municipal debt securities that are diversified both geographically and
according to revenue source. As such, the Adviser actively manages the assets
in relation to market conditions and interest rate changes. In seeking the
investment objective, the Trust does not expect to invest more than 25% of its
total assets in municipals that are issued by the same state. Depending on
yield and portfolio allocation considerations, the Adviser may choose to invest
a portion of the Trust's assets in securities which pay interest that is
subject to AMT (alternative minimum tax).
Under current market conditions the use of leverage increases the income earned
by the Trust. The Trust employs leverage primarily through the issuance of
preferred stock. Preferred stockholders will receive dividends based on
short-term rates in exchange for allowing the Trust to borrow additional
assets. These assets will be invested in longer-term assets which typically
offer higher interest rates and the difference between the cost of the
dividends paid to preferred stockholders and the interest earned on the
longer-term securities will provide higher income levels for common
stockholders in most interest rate environments. The Trust issued preferred
stock to leverage the portfolio at approximately 35% of total assets. To
protect the common stockholders from increases in the cost of the preferred
stock dividends, the Trust invests in securities called "additional interest
bonds" or "embedded caps", which can help to limit the risk of increasing costs
of leverage in a rising interest rate or flattening yield curve environment.
These bonds pay additional interest when short-term municipal interest rates
rise above a predetermined rate, or "cap". These securities are used, when
available in the marketplace, to attempt to offset increases in the interest
paid to preferred stockholders and may allow the Trust to maintain dividend
levels to common stockholders in interest rate environments where the yield
curve is either flat or inverted. See "Leverage Considerations in the Trust"
below.
15
<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 and Trust. 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 THE TRUST
Leverage increases the duration (or price sensitivity of the net assets with
respect to changes in interest rates) of the Trust, which can improve the
performance of the Trust in a declining rate environment, but can cause net
assets to decline faster in a rapidly rising interest rate environment. The
Trust may reduce, or unwind, the amount of leverage employed should BlackRock
consider that reduction to be in the best interests of the Trust. BlackRock's
portfolio managers continuously monitor and regularly review the Trust's use of
leverage and maintain the ability to unwind the leverage if that course is
chosen. As mentioned above, the Trust will attempt to maintain a percentage of
its investments in additional interest bonds which may help protect the Trust's
income from increases in the cost of leverage.
SPECIAL CONSIDERATIONS AND RISK FACTORS RELEVANT TO THE TRUST
THE TRUST IS INTENDED TO BE A LONG-TERM INVESTMENT AND IS NOT A SHORT-TERM
TRADING VEHICLE.
INVESTMENT OBJECTIVE. Although the objective of the Trust is to provide high
current income exempt from regular Federal income tax consistent with the
preservation of capital, there can be no assurance that this objective will be
achieved.
DIVIDEND CONSIDERATIONS. The income and dividends paid by the Trust are likely
to vary over time as fixed income market conditions change. Future dividends
may be higher or lower than the dividend the Trust is currently paying.
LEVERAGE. The Trust utilizes leverage through preferred stock, 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: BKN) 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.
INVESTMENT GRADE MUNICIPAL OBLIGATIONS. The value of municipal debt securities
generally varies inversely with changes in prevailing market interest rates.
Depending on the amount of call protection that the securities in the Trust
have, the Trust may be subject to certain reinvestment risks in environments of
declining interest rates.
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.
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.
16
<PAGE>
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THE BLACKROCK INVESTMENT QUALITY MUNICIPAL TRUST INC.
GLOSSARY
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<TABLE>
<S> <C>
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.
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 to common
shareholders on a monthly basis.
DIVIDEND REINVESTMENT: Shareholders may have all dividends and distributions of capital gains
automatically reinvested into additional shares of a fund.
EMBEDDED CAP BONDS: Also known as additonal interest municipal bonds. These securities are intended
to protect the income that a fund earns through leverage from significant
increases in short-term rates. The coupon on these bonds will increase if short
term rates rise significantly.
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.
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, THE NEW YORK TIMES
and THE WALL STREET JOURNAL on Monday.
PREMIUM: When a fund's stock price is greater than its net asset value, the fund is said to
be trading at a premium.
PREREFUNDED BONDS: These securities are collateralized by U.S. Government securities which are held
in escrow and are used to pay principal and interest on the tax exempt issue and
retire the bond in full at the date indicated, typically at a premium to par.
</TABLE>
17
<PAGE>
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BLACKROCK FINANCIAL MANAGEMENT, INC.
SUMMARY OF CLOSED-END FUNDS
- --------------------------------------------------------------------------------
TAXABLE TRUSTS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
STOCK MATURITY
SYMBOL DATE
PERPETUAL TRUSTS ---------- ---------
<S> <C> <C>
The BlackRock Income Trust Inc. BKT N/A
The BlackRock North American Government Income Trust Inc. BNA N/A
The BlackRock High Yield Trust BHY N/A
TERM TRUSTS
The BlackRock 1999 Term Trust Inc. BNN 12/99
The BlackRock Target Term Trust Inc. BTT 12/00
The BlackRock 2001 Term Trust Inc. BLK 06/01
The BlackRock Strategic Term Trust Inc. BGT 12/02
The BlackRock Investment Quality Term Trust Inc. BQT 12/04
The BlackRock Advantage Term Trust Inc. BAT 12/05
The BlackRock Broad Investment Grade 2009 Term Trust Inc. BCT 12/09
</TABLE>
TAX-EXEMPT TRUSTS
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<TABLE>
<CAPTION>
STOCK MATURITY
SYMBOL DATE
PERPETUAL TRUSTS --------- ---------
<S> <C> <C>
The BlackRock Investment Quality Municipal Trust Inc. BKN N/A
The BlackRock California Investment Quality Municipal Trust Inc. RAA N/A
The BlackRock Florida Investment Quality Municipal Trust RFA N/A
The BlackRock New Jersey Investment Quality Municipal Trust Inc. RNJ N/A
The BlackRock New York Investment Quality Municipal Trust Inc. RNY N/A
TERM TRUSTS
The BlackRock Municipal Target Term Trust Inc. BMN 12/06
The BlackRock Insured Municipal 2008 Term Trust Inc. BRM 12/08
The BlackRock California Insured Municipal 2008 Term Trust Inc. BFC 12/08
The BlackRock Florida Insured Municipal 2008 Term Trust BRF 12/08
The BlackRock New York Insured Municipal 2008 Term Trust Inc. BLN 12/08
The BlackRock Insured Municipal Term Trust Inc. BMT 12/10
</TABLE>
IF YOU WOULD LIKE FURTHER INFORMATION PLEASE DO NOT HESITATE TO CALL BLACKROCK
AT (800) 227-7BFM (7236)
OR CONSULT WITH YOUR FINANCIAL ADVISOR.
18
<PAGE>
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BLACKROCK FINANCIAL MANAGEMENT, INC.
AN OVERVIEW
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BlackRock Financial Management, Inc. ("BlackRock") is an SEC-registered
investment adviser. BlackRock and its affiliates currently manage over $141
billion on behalf of taxable and tax-exempt clients worldwide. Strategies
include fixed income, equity and cash and may incorporate both domestic and
international securities. BlackRock manages twenty-one closed-end funds that
are traded on either the New York or American stock exchanges, and a $25
billion family of open-end equity and bond funds. Current accounts number over
450, domiciled in the United States and overseas.
BlackRock's fixed income product was introduced in 1988 by a team of
highly seasoned fixed income professionals. These professionals had extensive
experience creating, analyzing and trading a variety of fixed income
instruments, including the most complex structured securities. In fact, several
individuals at BlackRock were responsible for developing many of the major
innovations in the mortgage-backed and asset-backed securities markets,
including the creation of the first CMO, the floating rate CMO, the
senior/subordinated pass-through and the multi-class asset-backed security.
BlackRock is unique among asset management and advisory firms in the
emphasis it places on the development of proprietary analytical capabilities.
Over one quarter of the firm's professionals is dedicated to the design,
maintenance and use of these systems, which are not otherwise available to
investors. BlackRock's proprietary analytical tools are used for evaluating,
and designing fixed income investment strategies for client portfolios.
Securities purchased include mortgages, corporate bonds, municipal bonds and a
variety of hedging instruments.
BlackRock has developed investment products that respond to investors'
needs and has been responsible for several major innovations in closed-end
funds. In fact, BlackRock introduced the first closed-end mortgage fund, the
first taxable and tax-exempt closed-end funds to offer a finite term, the first
closed-end fund to achieve a AAA rating by Standard & Poor's, and the first
closed-end fund to invest primarily in North American Government securities.
Currently, BlackRock's closed-end funds have dividend reinvestment plans, which
are designed to provide ongoing demand for the stock in the secondary market.
BlackRock manages a wide range of investment vehicles, each having specific
investment objectives and policies.
In view of our continued desire to provide a high level of service to all
our shareholders, BlackRock maintains a toll-free number for your questions.
The number is (800) 227-7BFM (7236). We encourage you to call us with any
questions that you may have about your BlackRock funds and we thank you for the
continued trust that you place in our abilities.
IF YOU WOULD LIKE FURTHER INFORMATION
PLEASE DO NOT HESITATE TO CALL BLACKROCK AT (800) 227-7BFM
19
<PAGE>
BLACKROCK
DIRECTORS
Laurence D. Fink, CHAIRMAN
Andrew F. Brimmer
Richard E. Cavanagh
Kent Dixon
Frank J. Fabozzi
James Grosfeld
James Clayburn La Force, Jr.
Walter F. Mondale
Ralph L. Schlosstein
OFFICERS
Ralph L. Schlosstein, PRESIDENT
Keith T. Anderson, VICE PRESIDENT
Michael C. Huebsch, VICE PRESIDENT
Robert S. Kapito, VICE PRESIDENT
Kevin Klingert, VICE PRESIDENT
Richard M. Shea, VICE PRESIDENT/TAX
Henry Gabbay, TREASURER
James Kong, ASSISTANT TREASURER
Karen H. Sabath, SECRETARY
INVESTMENT ADVISER
BlackRock Financial Management, Inc.
345 Park Avenue
New York, NY 10154
(800) 227-7BFM
ADMINISTRATOR
Princeton Administrators, L.P.
P.O. Box 9095
Princeton, NJ 08543-9095
(800) 543-6217
CUSTODIAN AND TRANSFER AGENT
State Street Bank and Trust Company
One Heritage Drive
North Quincy, MA 02171
(800) 699-1BFM
AUCTION AGENT
Bankers Trust Company
4 Albany Street
New York, NY 10006
INDEPENDENT AUDITORS
Deloitte & Touche LLP
Two World Financial Center
New York, NY 10281-1434
LEGAL COUNSEL
Skadden, Arps, Slate, Meagher & Flom LLP
919 Third Avenue
New York, NY 10022
The accompanying financial statements as of April 30, 1999 were not
audited and, accordingly, no opinion is expressed on them.
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
MUNICIPAL TRUST INC.
c/o Princeton Administrators, L.P.
P.O. Box 9095
Princeton, NJ 08543-9095
(800) 543-6217
=======================================
The BLACKROCK
Investment Quality
Municipal Trust Inc.
=====================
Semi-Annual Report
April 30, 1999
[GRAPHIC OMITTED]
09247D-105
[LOGO] Printed on recycled paper 09247D-204
09247D-303
