MUNIVEST
NEW JERSEY
FUND, INC.
FUND LOGO
Annual Report
October 31, 1999
This report, including the financial information herein, is
transmitted to the shareholders of MuniVest New Jersey Fund, Inc.
for their information. It is not a prospectus, circular or
representation intended for use in the purchase of shares of the
Fund or any securities mentioned in the report. Past performance
results shown in this report should not be considered a
representation of future performance. The Fund has leveraged its
Common Stock by issuing Preferred Stock to provide the Common Stock
shareholders with a potentially higher rate of return. Leverage
creates risks for Common Stock shareholders, including the
likelihood of greater volatility of net asset value and market price
of shares of the Common Stock, and the risk that fluctuations in the
short-term dividend rates of the Preferred Stock may affect the
yield to Common Stock shareholders. Statements and other information
herein are as dated and are subject to change.
MuniVest
New Jersey Fund, Inc.
Box 9011
Princeton, NJ
08543-9011
Printed on post-consumer recycled paper
MUNIVEST NEW JERSEY FUND, INC.
The Benefits and
Risks of
Leveraging
MuniVest New Jersey Fund, Inc. utilizes leveraging to seek to
enhance the yield and net asset value of its Common Stock. However,
these objectives cannot be achieved in all interest rate
environments. To leverage, the Fund issues Preferred Stock, which
pays dividends at prevailing short-term interest rates, and invests
the proceeds in long-term municipal bonds. The interest earned on
these investments is paid to Common Stock shareholders in the form
of dividends, and the value of these portfolio holdings is reflected
in the per share net asset value of the Fund's Common Stock.
However, in order to benefit Common Stock shareholders, the yield
curve must be positively sloped; that is, short-term interest rates
must be lower than long-term interest rates. At the same time, a
period of generally declining interest rates will benefit Common
Stock shareholders. If either of these conditions change, then the
risks of leveraging will begin to outweigh the benefits.
To illustrate these concepts, assume a fund's Common Stock
capitalization of $100 million and the issuance of Preferred Stock
for an additional $50 million, creating a total value of $150
million available for investment in long-term municipal bonds. If
prevailing short-term interest rates are approximately 3% and long-
term interest rates are approximately 6%, the yield curve has a
strongly positive slope. The fund pays dividends on the $50 million
of Preferred Stock based on the lower short-term interest rates. At
the same time, the fund's total portfolio of $150 million earns the
income based on long-term interest rates. Of course, increases in
short-term interest rates would reduce (and even eliminate) the
dividends on the Common Stock.
In this case, the dividends paid to Preferred Stock shareholders are
significantly lower than the income earned on the fund's long-term
investments, and therefore the Common Stock shareholders are the
beneficiaries of the incremental yield. However, if short-term
interest rates rise, narrowing the differential between short-term
and long-term interest rates, the incremental yield pickup on the
Common Stock will be reduced or eliminated completely. At the same
time, the market value of the fund's Common Stock (that is, its
price as listed on the New York Stock Exchange) may, as a result,
decline. Furthermore, if long-term interest rates rise, the Common
Stock's net asset value will reflect the full decline in the price
of the portfolio's investments, since the value of the fund's
Preferred Stock does not fluctuate. In addition to the decline in
net asset value, the market value of the fund's Common Stock may
also decline.
As a part of its investment strategy, the Fund may invest in certain
securities whose potential income return is inversely related to
changes in a floating interest rate ("inverse floaters"). In
general, income on inverse floaters will decrease when short-term
interest rates increase and increase when short-term interest rates
decrease. Investments in inverse floaters may be characterized as
derivative securities and may subject the Fund to the risks of
reduced or eliminated interest payments and losses of invested
principal. In addition, inverse floaters have the effect of
providing investment leverage and, as a result, the market value of
such securities will generally be more volatile than that of fixed-
rate, tax-exempt securities. To the extent the Fund invests in
inverse floaters, the market value of the Fund's portfolio and the
net asset value of the Fund's shares may also be more volatile than
if the Fund did not invest in such securities.
MuniVest New Jersey Fund, Inc., October 31, 1999
DEAR SHAREHOLDER
For the year ended October 31, 1999, the Common Stock of MuniVest
New Jersey Fund, Inc. earned $0.780 per share income dividends,
which included earned and unpaid dividends of $0.065. This
represents a net annualized yield of 6.22%, based on a month-end per
share net asset value of $12.55. Over the same period, the total
investment return on the Fund's Common Stock was -9.70%, based on a
change in per share net asset value from $14.72 to $12.55, and
assuming reinvestment of $0.782 per share income dividends.
For the six-month period ended October 31, 1999, the total
investment return on the Fund's Common Stock was -10.88%, based on a
change in per share net asset value from $14.52 to $12.55, and
assuming reinvestment of $0.392 per share income dividends.
For the six-month period ended October 31, 1999, the Fund's Auction
Market Preferred Stock had an average yield of 3.11%.
The Municipal Market Environment
The combination of steady strong domestic economic growth,
improvement in foreign economies (most notably in Japan) and
increasing investor concerns regarding potential increases in US
inflation put upward pressure on bond yields throughout the six-
month period ended October 31, 1999. Continued strong US employment
growth, particularly the decline in the US unemployment rate to 4.2%
in early June, was among the reasons the Federal Reserve Board cited
for raising short-term interest rates in late June and again in late
August. US Treasury bond yields reacted by climbing above 6.375% by
late October. However, at October month-end, economic indicators
were released suggesting that, despite strong economic and
employment growth in the third quarter, inflationary pressures have
remained extremely well-contained. This resulted in a significant
rally in the US Treasury bond market, pushing US Treasury bond
yields downward to end the six-month period at approximately 6.15%.
During the period, yields on 30-year US Treasury bonds increased
over 50 basis points (0.50%).
Long-term tax-exempt bond yields also rose during the six months
ended October 31, 1999. Until early May, the municipal bond market
was able to withstand much of the upward pressure on bond yields.
However, investor concerns of additional moves by the Federal
Reserve Board to moderate US economic growth and, more importantly,
the loss of the strong technical support that the tax-exempt market
enjoyed in early 1999 helped push municipal bond yields
significantly higher for the remainder of the period. The yields on
long-term tax-exempt revenue bonds rose nearly 90 basis points to
6.18% by October 31, 1999, as measured by the Bond Buyer Revenue
Bond Index.
In recent months, the significant decline in new tax-exempt bond
issuance has remained a positive factor within the municipal bond
market, as it had been for much of the past year. During the last
six months, more than $110 billion in long-term municipal bonds was
issued, a decline of nearly 20% compared to the same period a year
ago. During the past three months, $55 billion in municipal bonds
was underwritten, representing a decline of nearly 10% compared to
the corresponding period in 1998. Additionally, in June and July,
investors received more than $40 billion in coupon income and
proceeds from bond maturities and early bond redemptions. These
proceeds have generated considerable retail investor interest, which
has helped absorb the recent diminished supply.
Although tax-exempt bond yields are at their highest level in over
two years and have attracted significant retail investor interest,
institutional demand has declined sharply. Long-term municipal
mutual funds have seen consistent outflows in recent months as the
yields of individual securities have risen faster than those of
larger, more diverse mutual funds. In addition, the demand from
property/casualty insurance companies has weakened as a result of
the losses, and anticipated losses, incurred as a result of the
series of damaging storms across much of the eastern United States.
Additionally, many institutional investors who were attracted to the
municipal bond market in recent years by historically attractive tax-
exempt bond yield ratios of over 90% have found other asset classes
even more attractive. Even with a reduced supply position, tax-
exempt issuers have been forced to repeatedly raise municipal bond
yields in the attempt to attract adequate demand.
The recent relative underperformance of the municipal bond market
has resulted in an opportunity for long-term investors to purchase
tax-exempt issues whose yields are nearly identical with taxable US
Treasury securities. At October 31, 1999, long-term uninsured muni-
cipal revenue bond yields were 100% of comparable US Treasury
securities. In recent months, many taxable asset classes, such as
corporate bonds, mortgage-backed securities and US agency debt, have
all accelerated debt issuance. This acceleration was initiated
largely to avoid issuing securities at year-end and to minimize any
associated Year 2000 (Y2K) problems that may develop. However, this
increased issuance has also resulted in higher yield levels in the
various asset classes as lower bond prices became necessary to
attract sufficient investor demand. Going forward, it is believed
that the pace of non-US government debt issuance is likely to slow
significantly. As the supply of this debt declines, we would expect
many institutional investors to return to the municipal bond market
and the attractive yield ratios available.
Looking ahead, it appears to us that long-term tax-exempt bond
yields will remain under pressure, trading in a broad range centered
near current levels. Investors are likely to remain concerned about
future action by the Federal Reserve Board in November. Y2K
considerations may prohibit any further Federal Reserve Board moves
through the end of the year and the beginning of 2000. Any
improvement in bond prices will probably be contingent upon
weakening in both US employment growth and consumer spending. The
100 basis point rise in US Treasury bond yields seen thus far this
year may negatively impact US economic growth. The US housing market
will be among the first sectors likely to be affected, as some
declines have already been evidenced in response to higher mortgage
rates. We believe that it is also unrealistic to expect double-digit
returns in US equity markets to continue indefinitely. Much of the
US consumer's wealth is tied to recent stock market appreciation.
Any slowing in these incredible growth rates is likely to reduce
consumer spending. We believe that these factors suggest that the
worst of the recent increase in bond yields has passed and stable,
if not slightly improving, bond prices may be expected.
In Conclusion
On September 21, 1999, MuniVest New Jersey Fund, Inc.'s Board of
Directors approved a plan of reorganization, subject to shareholder
approval and certain other conditions, whereby MuniYield New Jersey
Fund, Inc. would acquire substantially all of the assets and
liabilities of the Fund in exchange for newly issued shares of
MuniYield New Jersey Fund, Inc. These funds are registered, non-
diversified, closed-end management investment companies. Both
entities have similar investment objectives and are managed by Fund
Asset Management, L.P.
We appreciate your investment in MuniVest New Jersey Fund, Inc.
Sincerely,
(Terry K. Glenn)
Terry K. Glenn
President and Director
(Vincent R. Giordano)
Vincent R. Giordano
Senior Vice President
(Theodore R. Jaeckel Jr.)
Theodore R. Jaeckel Jr.
Vice President and Portfolio Manager
December 8, 1999
MuniVest New Jersey Fund, Inc., October 31, 1999
<TABLE>
PROXY RESULTS
<CAPTION>
During the six-month period ended October 31, 1999, MuniVest New
Jersey Fund, Inc.'s Common Stock shareholders voted on the following
proposal. Proposal 1 was approved at a shareholders' meeting on May
27, 1999. A description of the proposal and number of shares voted
are as follows:
Shares Voted Shares Voted Shares Voted
For Against Abstain
<S> <C> <C> <C>
1. To approve an amendment to the Articles Supplementary of the Fund. 2,811,982 144,974 106,336
<CAPTION>
During the six-month period ended October 31, 1999, MuniVest New
Jersey Fund, Inc.'s Preferred Stock shareholders voted on the
following proposal. Proposal 1 was approved at a shareholders'
meeting on May 27, 1999. A description of the proposal and number of
shares voted are as follows:
Shares Voted Shares Voted Shares Voted
For Against Abstain
1. To approve an amendment to the Articles Supplementary of the Fund. 963 6 24
</TABLE>
IMPORTANT TAX INFORMATION (unaudited)
All of the net investment income distributions paid by MuniVest New
Jersey Fund, Inc. during its taxable year ended October 31, 1999
qualify as tax-exempt interest dividends for Federal income tax
purposes. Additionally, there were no capital gains distributed by
the Fund during the year.
Please retain this information for your records.
QUALITY PROFILE (unaudited)
The quality ratings of securities in the Fund as of October 31, 1999
were as follows:
Percent of
S&P Rating/Moody's Rating Net Assets
AAA/Aaa 71.0%
AA/Aa 12.0
BBB/Baa 8.8
BB/Ba 3.2
NR (Not Rated) 2.0
Other++ 1.7
[FN]
++Temporary investments in short-term municipal securities.
PORTFOLIO ABBREVIATIONS
To simplify the listings of MuniVest New Jersey Fund, Inc.'s
portfolio holdings in the Schedule of Investments, we have
abbreviated the names of many of the securities according to the
list at right.
AMT Alternative Minimum Tax (subject to)
COP Certificates of Participation
EDA Economic Development Authority
GO General Obligation Bonds
RIB Residual Interests Bonds
RITR Residual Interest Trust Receipts
UT Unlimited Tax
VRDN Variable Rate Demand Notes
MuniVest New Jersey Fund, Inc., October 31, 1999
<TABLE>
SCHEDULE OF INVESTMENTS (in Thousands)
<CAPTION>
S&P Moody's Face Value
STATE Ratings Ratings Amount Issue (Note 1a)
<S> <S> <S> <C> <S> <C>
New AAA Aaa $ 2,500 Camden County, New Jersey, Improvement Authority, Lease
Jersey--98.7% Revenue Bonds (County Guaranteed), 6.15% due 10/01/2004 (d)(e) $ 2,705
AAA Aaa 1,000 Camden County, New Jersey, Municipal Utilities Authority, Sewer
Revenue Refunding Bonds, 5.20% due 7/15/2015 (b) 943
AAA Aaa 1,715 Cape May County, New Jersey, Industrial Pollution Control Financing
Authority Revenue Bonds (Atlantic City Electric Company Project),
AMT, Series A, 7.20% due 11/01/2029 (d) 1,882
AAA Aaa 1,000 Carteret, New Jersey, Board of Education COP, Refunding Bonds,
4.75% due 4/15/2019 (d) 860
AAA Aaa 1,425 East Orange, New Jersey, Board of Education, COP, 5.32%** due
8/01/2017 (c) 496
NR* Aaa 2,875 Hudson County, New Jersey, Improvement Authority, Facility Lease
Revenue Refunding Bonds, RIB, Series 34, 7.005% due 10/01/2024 (b)(f) 2,476
AAA NR* 835 Metuchen, New Jersey, School District, GO, UT, 5.15% due 9/15/2019 (b) 766
AAA Aaa 1,290 New Jersey Casino Reinvestment Development Authority, Parking Fee
Revenue Bonds, Series A, 5.25% due 10/01/2016 (c) 1,214
NR* NR* 600 New Jersey EDA, Economic Development Revenue Bonds (400 International
Drive Partners), VRDN, 3.30% due 9/01/2005 (g) 600
NR* Aa3 1,500 New Jersey EDA, Economic Development Revenue Refunding Bonds
(Burlington Coat Factory), 6.125% due 9/01/2010 1,566
AAA Aaa 3,900 New Jersey EDA, Natural Gas Facilities Revenue Refunding Bonds
(NUI Corporation Project), Series A, 6.35% due 10/01/2022 (a) 4,014
New Jersey EDA, Revenue Bonds:
AAA Aaa 2,400 (Educational Testing Service), Series B, 6.25% due 5/15/2005
(d)(e) 2,607
NR* Aaa 7,385 (Saint Barnabas), Series A, 5.53%** due 7/01/2022 (d) 1,866
AAA Aaa 5,250 (Transportation Project), Sub-Lease, Series B, 5.75% due
5/01/2010 (c) 5,469
New Jersey EDA, Revenue Refunding Bonds (First Mortgage):
BBB- NR* 2,000 (Fellowship Village), Series A, 5.50% due 1/01/2025 1,728
NR* NR* 1,250 (Franciscan Oaks Project), 5.70% due 10/01/2017 1,093
NR* NR* 1,250 (Franciscan Oaks Project), 5.75% due 10/01/2023 1,064
NR* Aa3 4,500 New Jersey EDA, Solid Waste Disposal Facilities Revenue Bonds
(Garden State Paper Company), 7.125% due 4/01/2022 4,784
BB Ba2 4,000 New Jersey EDA, Special Facility Revenue Bonds (Continental
Airlines Inc. Project), AMT, 5.50% due 4/01/2028 3,380
AAA Aaa 2,000 New Jersey EDA, Water Facilities Revenue Bonds (American Water
Company Inc. Project), AMT, 6% due 5/01/2036 (b) 1,994
New Jersey EDA, Water Facilities Revenue Bonds, RITR, AMT (f):
AAA Aaa 2,855 Series 34, 6.62% due 5/01/2032 (b) 2,330
AAA Aaa 1,500 Series 35, 6.304% due 2/01/2038 (d) 1,185
A1+ VMIG1++ 1,200 New Jersey EDA, Water Facilities Revenue Refunding Bonds (United
Water New Jersey Inc. Project), VRDN, Series B, 3.45% due
11/01/2025 (a)(g) 1,200
NR* Baa1 4,200 New Jersey Health Care Facilities Financing Authority Revenue
Bonds (Southern Ocean County Hospital), Series A, 6.25% due
7/01/2023 3,984
New Jersey Health Care Facilities Financing Authority, Revenue
Refunding Bonds:
BBB+ NR* 2,000 (Holy Name Hospital), 6% due 7/01/2025 1,864
AAA Aaa 2,845 (Jersey Shore Medical Center), 6.75% due 7/01/2004 (a)(e) 3,131
AAA NR* 2,155 (Jersey Shore Medical Center), 6.75% due 7/01/2019 (a) 2,331
AAA Aaa 2,945 (Meridan Health System Obligation Group), 5.25% due 7/01/2029 (c) 2,629
AAA Aaa 1,000 (Monmouth Medical Center), Series C, 6.25% due 7/01/2004 (c)(e) 1,082
AAA Aaa 2,000 (Saint Barnabas Health Center), Series B, 4.75% due 7/01/2028 (d) 1,641
AAA Aaa 1,700 (Saint Barnabas Hospital), Series B, 5.04%** due 7/01/2018 (d) 549
AAA Aaa 1,970 (Saint Barnabas Hospital), Series B, 5.04%** due 7/01/2020 (d) 560
AAA Aaa 2,365 (Saint Barnabas Hospital), Series B, 5.04%** due 7/01/2021 (d) 631
AAA Aaa 5,500 (Saint Barnabas Hospital), Series B, 5.05%** due 7/01/2023 (d) 1,296
BBB Baa2 2,075 (Saint Elizabeth Hospital Obligation Group), 6% due 7/01/2027 1,873
AAA Aaa 2,300 (Virtua Health Issue), 4.75% due 7/01/2018 (c) 1,975
New Jersey Sports and Exposition Authority, Convention Center,
Luxury Tax Revenue Refunding Bonds (d):
AAA Aaa 1,325 5% due 9/01/2015 1,219
AAA Aaa 2,205 5% due 9/01/2019 1,968
New Jersey State Educational Facilities Authority, Revenue Refunding
Bonds:
AA+ Aaa 1,000 (Institute for Advanced Study), Series F, 5% due 7/01/2018 903
AAA Aaa 2,225 (Ramapo College), Series G, 4.625% due 7/01/2022 (a) 1,856
AA+ Aa1 2,400 New Jersey State, GO, Refunding, Series F, 5.50% due 8/01/2011 2,450
NR* Aaa 2,675 New Jersey State Higher Education Assistance Authority, Student Loan
Revenue Bonds, RIB, AMT, Series 18, 6.775% due 6/01/2017 (a)(f) 2,341
AAA Aaa 2,700 New Jersey State Housing and Mortgage Finance Agency Revenue Bonds,
Home Buyer, AMT, Series M, 7% due 10/01/2026 (d) 2,864
AAA Aaa 5,150 New Jersey State Transit Corporation, COP, 6.50% due 10/01/2016 (c) 5,469
AA- Aa2 1,000 New Jersey State Transportation Trust Fund Authority Revenue Bonds
(Transportation System), Series A, 5.125% due 6/15/2015 933
AA- Aa 1,865 New Jersey Wastewater Treatment Trust Revenue Bonds, Series A,
6.50% due 4/01/2004 (e) 2,030
AAA Aaa 5,000 Passaic Valley, New Jersey, Sewer Commissioner's Revenue Refunding
Bonds (Sewer System), Series D, 5.875% due 12/01/2022 (a) 5,007
AA- A1 1,000 Port Authority of New York and New Jersey, Consolidated Revenue
Bonds, 93rd Series, 6.125% due 6/01/2094 1,024
AAA Aaa 2,500 Port Authority of New York and New Jersey, Special Obligation
Revenue Bonds (JFK International Air Terminal Project), AMT,
Series 6, 5.75% due 12/01/2022 (d) 2,428
AAA Aaa 3,500 South Jersey Transportation Authority, New Jersey, Transportation
System Revenue Refunding Bonds, 5% due 11/01/2029 (a) 3,020
AAA Aaa 2,500 West Windsor-Plainsboro, New Jersey, Regional School District, GO,
Refunding, 4.75% due 9/15/2024 (b) 2,104
Total Investments (Cost--$110,209)--98.7% 105,384
Other Assets Less Liabilities--1.3% 1,413
--------
Net Assets--100.0% $106,797
========
<FN>
(a)AMBAC Insured.
(b)FGIC Insured.
(c)FSA Insured.
(d)MBIA Insured.
(e)Prerefunded.
(f)The interest rate is subject to change periodically and
inversely based upon prevailing market rates. The interest rate
shown is the rate in effect at October 31, 1999.
(g)The interest rate is subject to change periodically based upon
prevailing market rates. The interest rate shown is the rate in
effect at October 31, 1999.
*Not Rated.
**Represents a zero coupon bond; the interest rate shown reflects
the effective yield at the time of purchase by the Fund.
++Highest short-term rating by Moody's Investors Service, Inc.
Ratings of issues shown have not been audited by Ernst & Young LLP
See Notes to Financial Statements.
</TABLE>
MuniVest New Jersey Fund, Inc., October 31, 1999
<TABLE>
STATEMENT OF ASSETS, LIABILITIES AND CAPITAL
<CAPTION>
As of October 31, 1999
<S> <S> <C> <C>
Assets: Investments, at value (identified cost--$110,208,794) (Note 1a) $105,384,272
Cash 47,929
Interest receivable 1,562,259
Prepaid expenses and other assets 16,180
------------
Total assets 107,010,640
------------
Liabilities: Payables:
Dividends to shareholders (Note 1e) $ 102,660
Investment adviser (Note 2) 51,856 154,516
------------
Accrued expenses and other liabilities 59,550
------------
Total liabilities 214,066
------------
Net Assets: Net assets $106,796,574
============
Capital: Capital Stock (200,000,000 shares authorized) (Note 4):
Preferred Stock, par value $.05 per share (1,500 shares
of AMPS* issued and outstanding at $25,000 per share
liquidation preference) $ 37,500,000
Common Stock, par value $.10 per share (5,519,681 shares
issued and outstanding) $ 551,968
Paid-in capital in excess of par 76,836,982
Undistributed investment income--net 516,172
Accumulated realized capital losses on investments--net
(Note 5) (3,784,026)
Unrealized depreciation on investments--net (4,824,522)
------------
Total--Equivalent to $12.55 net asset value per share of
Common Stock (market price--$11.375) 69,296,574
------------
Total capital $106,796,574
============
<FN>
*Auction Market Preferred Stock.
See Notes to Financial Statements.
</TABLE>
<TABLE>
STATEMENT OF OPERATIONS
<CAPTION>
For the Year Ended October 31, 1999
<S> <S> <C> <C>
Investment Interest and amortization of premium and discount earned $ 6,421,013
Income (Note 1d):
Expenses: Investment advisory fees (Note 2) $ 575,570
Commission fees (Note 4) 95,145
Professional fees 90,145
Transfer agent fees 57,950
Accounting services (Note 2) 48,205
Directors' fees and expenses 28,729
Printing and shareholder reports 21,067
Listing fees 16,221
Custodian fees 9,547
Pricing fees 8,031
Other 17,168
------------
Total expenses 967,778
------------
Investment income--net 5,453,235
------------
Realized & Realized gain on investments--net 795,435
Unrealized Change in unrealized appreciation/depreciation on investments--net (12,783,789)
Gain (Loss) on ------------
Investments--Net Net Decrease in Net Assets Resulting from Operations $ (6,535,119)
(Notes 1b, ============
1d & 3):
See Notes to Financial Statements.
</TABLE>
<TABLE>
STATEMENTS OF CHANGES IN NET ASSETS
<CAPTION>
For the Year Ended
October 31,
Increase (Decrease) in Net Assets: 1999 1998
<S> <S> <C> <C>
Operations: Investment income--net $ 5,453,235 $ 5,584,804
Realized gain on investments--net 795,435 2,170,081
Change in unrealized appreciation/depreciation on
investments--net (12,783,789) 743,792
------------ ------------
Net increase (decrease) in net assets resulting from
operations (6,535,119) 8,498,677
------------ ------------
Dividends to Investment income--net:
Shareholders Common Stock (4,312,428) (4,239,104)
(Note 1e): Preferred Stock (1,131,705) (1,290,390)
------------ ------------
Net decrease in net assets resulting from dividends
to shareholders (5,444,133) (5,529,494)
------------ ------------
Capital Stock Value of shares issued to Common Stock shareholders
Transactions in reinvestment of dividends 213,679 105,388
(Note 4): ------------ ------------
Net Assets: Total increase (decrease) in net assets (11,765,573) 3,074,571
Beginning of year 118,562,147 115,487,576
------------ ------------
End of year* $106,796,574 $118,562,147
============ ============
<FN>
*Undistributed investment income--net $ 516,172 $ 507,070
============ ============
See Notes to Financial Statements.
</TABLE>
MuniVest New Jersey Fund, Inc., October 31, 1999
<TABLE>
FINANCIAL HIGHLIGHTS
<CAPTION>
The following per share data and ratios have been derived
from information provided in the financial statements.
For the Year Ended October 31,
Increase (Decrease) in Net Asset Value: 1999 1998 1997 1996 1995
<S> <S> <C> <C> <C> <C> <C>
Per Share Net asset value, beginning of year $ 14.72 $ 14.18 $ 13.78 $ 13.76 $ 12.18
Operating -------- -------- -------- -------- --------
Performance: Investment income--net .99 1.01 1.00 1.01 1.02
Realized and unrealized gain (loss) on
investments--net (2.17) .53 .40 .01 1.58
-------- -------- -------- -------- --------
Total from investment operations (1.18) 1.54 1.40 1.02 2.60
-------- -------- -------- -------- --------
Less dividends to Common Stock shareholders:
Investment income--net (.78) (.77) (.78) (.78) (.76)
-------- -------- -------- -------- --------
Total dividends to Common Stock shareholders (.78) (.77) (.78) (.78) (.76)
-------- -------- -------- -------- --------
Effect of Preferred Stock activity:
Dividends to Preferred Stock shareholders:
Investment income--net (.21) (.23) (.22) (.22) (.26)
-------- -------- -------- -------- --------
Total effect of Preferred Stock activity (.21) (.23) (.22) (.22) (.26)
-------- -------- -------- -------- --------
Net asset value, end of year $ 12.55 $ 14.72 $ 14.18 $ 13.78 $ 13.76
======== ======== ======== ======== ========
Market price per share, end of year $ 11.375 $ 14.875 $ 13.25 $ 12.25 $ 12.00
======== ======== ======== ======== ========
Total Investment Based on market price per share (19.00%) 18.56% 14.78% 8.67% 26.66%
Return:* ======== ======== ======== ======== ========
Based on net asset value per share (9.70%) 9.63% 9.19% 6.61% 20.74%
======== ======== ======== ======== ========
Ratios Based on Total expenses** 1.24% 1.20% 1.23% 1.21% 1.28%
Average Net ======== ======== ======== ======== ========
Assets of Total investment income--net** 7.00% 7.11% 7.11% 7.31% 7.93%
Common Stock: ======== ======== ======== ======== ========
Amount of dividends to Preferred Stock
shareholders 1.45% 1.64% 1.56% 1.62% 2.01%
======== ======== ======== ======== ========
Investment income--net, to Common Stock
shareholders 5.55% 5.47% 5.55% 5.69% 5.92%
======== ======== ======== ======== ========
Ratios Based on Total expenses .84% .81% .83% .81% .84%
Total Average ======== ======== ======== ======== ========
Net Assets:**++ Total investment income--net 4.73% 4.78% 4.82% 4.87% 5.20%
======== ======== ======== ======== ========
Ratios Based on Dividends to Preferred Stock shareholders 3.03% 3.44% 3.22% 3.27% 3.82%
Average Net ======== ======== ======== ======== ========
Assets of
Preferred Stock:
Supplemental Net assets, net of Preferred Stock, end of
Data: year (in thousands) $ 69,297 $ 81,062 $ 77,988 $ 75,775 $ 75,657
======== ======== ======== ======== ========
Preferred Stock outstanding, end of year
(in thousands) $ 37,500 $ 37,500 $ 37,500 $ 37,500 $ 37,500
======== ======== ======== ======== ========
Portfolio turnover 44.23% 54.73% 39.77% 99.56% 62.45%
======== ======== ======== ======== ========
Leverage: Asset coverage per $1,000 $ 2,848 $ 3,162 $ 3,080 $ 3,021 $ 3,018
======== ======== ======== ======== ========
Dividends Investment income--net $ 754 $ 860 $ 805 $ 818 $ 955
Per Share ======== ======== ======== ======== ========
On Preferred
Stock
Outstanding:
<FN>
*Total investment returns based on market value, which can be
significantly greater or lesser than the net asset value, may result
in substantially different returns. Total investment returns exclude
the effects of sales charges.
**Do not reflect the effect of dividends to Preferred Stock
shareholders.
++Includes Common and Preferred Stock average net assets.
See Notes to Financial Statements.
</TABLE>
NOTES TO FINANCIAL STATEMENTS
1. Significant Accounting Policies:
MuniVest New Jersey Fund, Inc. (the "Fund") is registered under the
Investment Company Act of 1940 as a non-diversified, closed-end
management investment company. The Fund's financial statements are
prepared in accordance with generally accepted accounting
principles, which may require the use of management accruals and
estimates. The Fund's Common Stock is listed on the New York Stock
Exchange under the symbol MVJ. The following is a summary of
significant accounting policies followed by the Fund.
(a) Valuation of investments--Municipal bonds are traded primarily
in the over-the-counter markets and are valued at the most recent
bid price or yield equivalent as obtained by the Fund's pricing
service from dealers that make markets in such securities. Financial
futures contracts and options thereon, which are traded on
exchanges, are valued at their closing prices as of the close of
such exchanges. Options written or purchased are valued at the sale
price in the case of exchange-traded options. In the case of options
traded in the over-the-counter market, valuation is the last asked
price (options written) or the last bid price (options purchased).
Securities with remaining maturities of sixty days or less are
valued at amortized cost, which approximates market value.
Securities and assets for which market quotations are not readily
available are valued at fair value as determined in good faith by or
under the direction of the Board of Directors of the Fund, including
valuations furnished by a pricing service retained by the Fund,
which may utilize a matrix system for valuations. The procedures of
the pricing service and its valuations are reviewed by the officers
of the Fund under the general supervision of the Board of Directors.
(b) Derivative financial instruments--The Fund may engage in various
portfolio strategies to seek to increase its return by hedging its
portfolio against adverse movements in the debt markets. Losses may
arise due to changes in the value of the contract or if the
counterparty does not perform under the contract.
* Financial futures contracts--The Fund may purchase or sell financial
futures contracts and options on such futures contracts for the
purpose of hedging the market risk on existing securities or the
intended purchase of securities. Futures contracts are contracts for
delayed delivery of securities at a specific future date and at a
specific price or yield. Upon entering into a contract, the Fund
deposits and maintains as collateral such initial margin as required
by the exchange on which the transaction is effected. Pursuant to
the contract, the Fund agrees to receive from or pay to the broker
an amount of cash equal to the daily fluctuation in value of the
contract. Such receipts or payments are known as variation margin
and are recorded by the Fund as unrealized gains or losses. 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.
* Options--The Fund is authorized to write covered call options and
purchase put options. When the Fund writes an option, an amount
equal to the premium received by the Fund is reflected as an asset
and an equivalent liability. The amount of the liability is
subsequently marked to market to reflect the current market value of
the option written. When a security is purchased or sold through an
exercise of an option, the related premium paid (or received) is
added to (or deducted from) the basis of the security acquired or
deducted from (or added to) the proceeds of the security sold. When
an option expires (or the Fund enters into a closing transaction),
the Fund realizes a gain or loss on the option to the extent of the
premiums received or paid (or gain or loss to the extent the cost of
the closing transaction exceeds the premium paid or received).
Written and purchased options are non-income producing investments.
(c) Income taxes--It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute substantially all of its
taxable income to its shareholders. Therefore, no Federal income tax
provision is required.
(d) Security transactions and investment income--Security
transactions are recorded on the dates the transactions are entered
into (the trade dates). Interest income is recognized on the accrual
basis. Discounts and market premiums are amortized into interest
income. Realized gains and losses on security transactions are
determined on the identified cost basis.
(e) Dividends and distributions--Dividends from net investment
income are declared and paid monthly. Distributions of capital gains
are recorded on the ex-dividend dates.
MuniVest New Jersey Fund, Inc., October 31, 1999
NOTES TO FINANCIAL STATEMENTS (concluded)
2. Investment Advisory Agreement and Transactions
with Affiliates:
The Fund has entered into an Investment Advisory Agreement with Fund
Asset Management, L.P. ("FAM"). The general partner of FAM is
Princeton Services, Inc. ("PSI"), an indirect wholly-owned
subsidiary of Merrill Lynch & Co., Inc. ("ML & Co."), which is the
limited partner.
FAM is responsible for the management of the Fund's portfolio and
provides the necessary personnel, facilities, equipment and certain
other services necessary to the operations of the Fund. For such
services, the Fund pays a monthly fee at an annual rate of .50% of
the Fund's average weekly net assets, including proceeds from the
issuance of Preferred Stock.
Accounting services are provided to the Fund by FAM at cost.
Certain officers and/or directors of the Fund are officers and/or
directors of FAM, PSI, and/or ML & Co.
3. Investments:
Purchases and sales of investments, excluding short-term securities,
for the year ended October 31, 1999 were $51,543,593 and
$48,970,769, respectively.
Net realized gains for the year ended October 31, 1999 and net
unrealized losses as of October 31, 1999 were as follows:
Realized Unrealized
Gains Losses
Long-term investments $ 795,435 $(4,824,522)
------------ -----------
Total $ 795,435 $(4,824,522)
============ ===========
As of October 31, 1999, net unrealized depreciation for Federal
income tax purposes aggregated $4,945,763, of which $1,853,929
related to appreciated securities and $6,799,692 related to
depreciated securities. The aggregate cost of investments at October
31, 1999 for Federal income tax purposes was $110,330,035.
4. Capital Stock Transactions:
The Fund is authorized to issue 200,000,000 shares of capital stock,
including Preferred Stock, par value $.10 per share, all of which
were initially classified as Common Stock. The Board of Directors is
authorized, however, to reclassify any unissued shares of capital
stock without approval of holders of Common Stock.
Common Stock
Shares issued and outstanding during the years ended October 31,
1999 and October 31, 1998 increased by 14,564 and 7,164,
respectively, as a result of dividend reinvestment.
Preferred Stock
Auction Market Preferred Stock ("AMPS") are shares of Preferred
Stock of the Fund, with a par value of $.05 per share and a
liquidation preference of $25,000 per share, that entitle their
holders to receive cash dividends at an annual rate that may vary
for the successive dividend periods. The yield in effect at October
31, 1999 was 3.25%.
Shares issued and outstanding during the years ended October 31,
1999 and October 31, 1998 remained constant.
The Fund pays commissions to certain broker-dealers at the end of
each auction at an annual rate ranging from .25% to .375%,
calculated on the proceeds of each auction. For the year ended
October 31, 1999, Merrill Lynch, Pierce, Fenner & Smith
Incorporated, an affiliate of FAM, earned $39,924 as commissions.
5. Capital Loss Carryforward:
At October 31, 1999, the Fund had a net capital loss carryforward of
approximately $2,596,000, of which $265,000 expires in 2002 and
$2,331,000 expires in 2003. This amount will be available to offset
like amounts of any future taxable gains.
6. Reorganization Plan:
On September 21, 1999, the Fund's Board of Directors approved a plan
of reorganization, subject to shareholder approval and certain other
conditions, whereby MuniYield New Jersey Fund, Inc. would acquire
substantially all of the assets and liabilities of the Fund in
exchange for newly issued shares of MuniYield New Jersey Fund, Inc.
These Funds are registered, non-diversified, closed-end management
investment companies. Both entities have a similar investment
objective and are managed by FAM.
7. Subsequent Event:
On November 8, 1999, the Fund's Board of Directors declared an
ordinary income dividend to Common Stock shareholders in the amount
of $.065000 per share, payable on November 29, 1999 to shareholders
of record as of November 22, 1999.
<AUDIT-REPORT>
REPORT OF INDEPENDENT AUDITORS
To the Shareholders and Board of Directors,
MuniVest New Jersey Fund, Inc.
We have audited the accompanying statement of assets, liabilities
and capital of MuniVest New Jersey Fund, Inc., including the
schedule of investments, as of October 31, 1999, and the related
statement of operations for the year then ended, the statements of
changes in net assets for each of the two years in the period then
ended and financial highlights for each of the years indicated
therein. These financial statements and financial highlights are the
responsibility of the Fund's management. Our responsibility is to
express an opinion on these financial statements and financial
highlights based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material
misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements
and financial highlights. Our procedures included confirmation of
securities owned as of October 31, 1999 by correspondence with the
custodian. An audit also includes assessing the accounting
principles used and significant estimates made by management, as
well as evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the
financial position of MuniVest New Jersey Fund, Inc. at October 31,
1999, the results of its operations for the year then ended, the
changes in its net assets for each of the two years in the period
then ended and the financial highlights for each of the indicated
years, in conformity with generally accepted accounting principles.
Ernst & Young LLP
MetroPark, New Jersey
December 3, 1999
</AUDIT-REPORT>
MuniVest New Jersey Fund, Inc., October 31, 1999
MANAGED DIVIDEND POLICY
The Fund's dividend policy is to distribute substantially all of its
net investment income to its shareholders on a monthly basis.
However, in order to provide shareholders with a more consistent
yield to the current trading price of shares of Common Stock of the
Fund, the Fund may at times pay out less than the entire amount of
net investment income earned in any particular month and may at
times in any particular month pay out such accumulated but
undistributed income in addition to net investment income earned in
that month. As a result, the dividends paid by the Fund for any
particular month may be more or less than the amount of net
investment income earned by the Fund during such month. The Fund's
current accumulated but undistributed net investment income, if any,
is disclosed in the Statement of Assets, Liabilities and Capital,
which comprises part of the financial information included in this
report.
YEAR 2000 ISSUES (unaudited)
Many computer systems were designed using only two digits to
designate years. These systems may not be able to distinguish the
Year 2000 from the Year 1900 (commonly known as the "Year 2000
Problem"). The Fund could be adversely affected if the computer
systems used by the Fund's management or other Fund service
providers do not properly address this problem before January 1,
2000. The Fund's management expects to have addressed this problem
before then, and does not anticipate that the services it provides
will be adversely affected. The Fund's other service providers have
told the Fund's management that they also expect to resolve the Year
2000 Problem, and the Fund's management will continue to monitor the
situation as the Year 2000 approaches. However, if the problem has
not been fully addressed, the Fund could be negatively affected. The
Year 2000 Problem could also have a negative impact on the
securities in which the Fund invests, and this could hurt the Fund's
investment returns.
OFFICERS AND DIRECTORS
Terry K. Glenn, President and Director
Donald Cecil, Director
M. Colyer Crum, Director
Edward H. Meyer, Director
Jack B. Sunderland, Director
J. Thomas Touchton, Director
Fred G. Weiss, Director
Arthur Zeikel, Director
Vincent R. Giordano, Senior Vice President
Kenneth A. Jacob, Vice President
Theodore R. Jaeckel Jr., Vice President
Donald C. Burke, Vice President and Treasurer
Alice A. Pellegrino, Secretary
Custodian
The Bank of New York
90 Washington Street
New York, NY 10286
Transfer Agents
Common Stock:
The Bank of New York
101 Barclay Street
New York, NY 10286
Preferred Stock:
The Bank of New York
100 Church Street
New York, NY 10286
NYSE Symbol
MVJ
