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THE BLACKROCK CALIFORNIA INVESTMENT QUALITY MUNICIPAL TRUST INC.
SEMI-ANNUAL REPORT TO SHAREHOLDERS
REPORT OF INVESTMENT ADVISER
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May 31, 1995
Dear Shareholder:
The fixed income markets experienced both extremely bearish and bullish
sentiment during the semi-annual period between November 1, 1994 and April 30,
1995. Closed-end bond funds responded to the broader markets with similar
volatility and hit all-time low stock prices during the fourth quarter of 1994.
These low levels of stock valuation were further eroded by an unusually high
degree of tax-related selling; however, closed-end bond funds have staged a
resounding rebound during the first five months of 1995. The U.S. economy
appears to have responded to the Fed's vigilance toward inflation with low
absolute levels of inflation and moderate rates of growth. This scenario is
suggestive of a "soft landing" for the economy, which has sparked a significant
Treasury market rally and resulted in overall strength in most fixed income
markets.
BlackRock Financial Management, Inc., your Trust's investment adviser, is
pleased to report that its acquisition by PNC Bank, N.A. ("PNC") was officially
completed on February 28, 1995. PNC is a commercial bank whose principal office
is in Pittsburgh, Pennsylvania and is a wholly-owned by PNC Bank Corp., a bank
holding company. The merger was structured to assure continuity of performance
and service through stability of our organization. BlackRock retains its name
and continues to operate out of its New York office. All members of BlackRock's
management team have signed long-term employment contracts and will continue to
be responsible for managing BlackRock's business so that shareholders will
notice no changes in the management of the Trust.
You will note several enhancements to the Trust's semi-annual report
designed to improve the report's usefulness to you. The letter to shareholders
which reviews the markets and Trust's investment strategy over the semi-annual
period is provided by the Trust's portfolio managers. In addition, we have
included an investment summary section which provides a synopsis of the Trust's
investment objectives and guidelines and reviews its investment strategy. We
appreciate your investment in The BlackRock California Investment Quality
Municipal Trust Inc. and look forward to continuing to serve your financial
needs.
Sincerely,
Laurence D. Fink Ralph L. Schlosstein
Chairman President
1
<PAGE>
May 31, 1995
Dear Shareholder:
Characterized by large swings in interest rates across the yield curve, the
semi-annual period between November 1, 1994 and April 30, 1995 provided a
challenging investment environment for fixed income products including The
BlackRock California Investment Quality Municipal Trust Inc. ("RAA" or the
"Trust"). At the beginning of the fiscal period, RAA was trading at a stock
price of $10.625, while at the end of this fiscal period (April 30, 1995) the
Trust closed at $12.50. During this same period, the net asset value (NAV)
increased from $11.74 to $12.95. As we write this letter, the Trust's shares are
trading at a price of $12.50 per share, which is a 9.35% discount to its net
asset value of $13.79 per share. The current annual dividend per share is
$0.7872, which is equivalent to a yield of 6.30% on the current stock price.
According to Lipper Analytical Services, Inc., 94% of municipal closed-end bond
funds are trading at a discount to their net asset values. The significant fixed
income market rally of 1995 has resulted in the Trust's NAV increasing more
rapidly than its market price, which is reflected in the current discount.
BlackRock feels that as investors adapt to the more positive tone in the
marketplace, the discount on RAA should narrow.
A review of the fixed income markets over the past year as well as the
trading activity in the Trust's portfolio that has taken place since our last
annual report appears below. This information should provide you with a greater
understanding of the active management strategies you have hired BlackRock to
provide to the Trust.
The Fixed Income Markets
The fourth quarter of 1994 echoed the underperformance that pervaded the
fixed income markets throughout 1994. The market experienced periods of
illiquidity during November as mutual funds sold securities to meet redemptions
and dealers were reluctant to add to their already large inventories. From a
yield curve perspective, the municipal curve remained rather steep compared to
the taxable curve. However, during the first quarter of 1995, the long end of
the municipal bond market witnessed a dramatic rally which resulted in a
flattening of the municipal yield curve. This rally was a result of a
significant amount of cash which needed to be reinvested in the municipal market
due to approximately $35 billion in cash flow from principal and interest
payments as well as crossover accounts returning to the market aggressively.
Ratios of long-term municipal yields to long-term Treasury yields ended the
quarter at 78.7%, the richest levels we have experienced since August of 1992.
Interestingly, the municipal yield curve flattened as the Treasury yield
curve steepened. The divergent trend between the shape of the municipal yield
curve and the Treasury curve was primarily the delayed response of the municipal
yield curve to the rapid Treasury curve flattening in late 1994. This recent
strong performance is likely to continue to some extent because of favorable
technical conditions. Individual investor demand for municipal bonds is expected
to remain high through the summer as approximately $60 billion in coupon and
redemption payments will flow into municipal investor hands during June and July
and will need to be reinvested. In addition, municipal bond supply, which
declined 46% in the first quarter of 1995 from the same quarter last year, is
expected to continue to diminish. These trends should allow municipal closed-end
bond funds like RAA to perform well in the near term.
Recently proposals for tax simplification, particularly the creation of a
"flat tax" have begun to receive attention. Some versions of this proposal would
eliminate the taxation of all investment income, which would offset the current
tax benefits of municipal bonds. This could result in an underperformance of the
municipal market if the flat tax becomes a pivotal 1996 Presidential campaign
issue. While actual tax reform is still at best two years away, we will continue
to actively follow the situation because investor concerns about tax reform
could cause dislocations in the municipal market, creating possible buying
opportunities for the Trust.
2
<PAGE>
The California economy has been improving over the fiscal period due to a
number of factors. The state's manufacturing sector has grown recently as the
expansion of world economies such as those of Europe and parts of Asia have
resulted in increased export demand for California's manufactured goods. While
the participants continue to closely monitor the antics of Orange County's
supervisors, the market for other California issuers continues to be orderly.
The situation in Orange County is not the result of an inability to pay as much
as a lack of willingness to pay. The Trust has no direct exposure to the Orange
County Bankruptcy proceedings.
The Closed-End Bond Fund Industry
During the final months of 1994, investor demand for closed-end bond funds
dropped to an all-time low level. Closed-end bond funds fell victim to a lack of
demand stemming from fears of rising inflation coupled with rising interest
rates and historically high levels of year-end tax swapping. As a result, the
prices of most closed-end bond funds, including RAA, dropped to historically low
levels. Investors who endured the market slump and opted to "hold" or acquire
more shares of the Trust during these tumultuous markets benefitted from a
substantial increase in both net asset value and share price during the first
quarter of 1995 as the market environment for fixed income securities improved
considerably.
Reflecting the current strength of the fixed income markets, the majority of
domestic closed-end bond funds registered positive gains for the one year period
ended April 30, 1995 with an average total return* of 6.46%. According to Lipper
Analytical Services, Inc., RAA ranked #2 out of 27 Closed-End California
Municipal Bond Funds for the one-year period ended April 30, 1995 with a total
return* of 9.72% versus its category's average of 7.11%.
- ---------------
*Total return was calculated based on net asset values and assumes the
reinvestment of dividends and distributions.
The Trust's Portfolio and Investment Strategy
BlackRock continues to actively manage the Trust's portfolio to selectively
modify the Trust's allocation to certain sectors, issuers, revenue sources and
types of bonds. Due to the 1993 change in tax treatment of market discounts on
individual bonds, we have been favoring premiums and discount securities over
those selling near par value since we believe that the market is not fully
valuing the effects of the tax change on par bonds. The following table
illustrates the sector reallocations during the fiscal period:
Sector Breakdown
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Sector April 30, 1995 October 31, 1994
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Water & Sewer 18% 14%
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Utility 15% 15%
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Transportation 13% 13%
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Miscellaneous Revenue 11% 5%
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University 10% 10%
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Housing 10% 5%
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Sales Tax 9% 14%
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Lease 5% 15%
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City, County & State 5% 5%
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Power 4% 4%
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3
<PAGE>
The portfolio consists of investment grade municipal securities (securities
rated at least "BBB") with average maturities of 19 years. We continue to
closely monitor the credit quality of the Trust's assets, 73% of which are rated
either "AAA" or "AA", and subject the credits to rigorous credit analysis.
Currently, the breakdown by credit quality is as follows:
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Standard & Poor's/Moody's
Credit Rating April 30, 1995 October 31, 1994
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AAA/Aaa 50% 55%
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AA/Aa 23% 9%
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A/A 24% 32%
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BBB/Baa 3% 4%
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We thank you for your investment in The BlackRock California Investment
Quality Municipal Trust Inc. Please feel free to contact us at (800) 227-7BFM
(7236) if you have specific questions which were not addressed in this
semi-annual report.
Sincerely,
Robert Kapito Kevin Klingert
Vice Chairman and Principal and Municipal
Senior Portfolio Manager Portfolio Manager
BlackRock Financial Management, Inc. BlackRock Financial Management, Inc.
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The BlackRock California Investment Quality Municipal Trust Inc.
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Symbol on American Stock Exchange: RAA
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Initial Offering Date: May 28, 1993
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Closing Stock Price as of 4/30/95: $12.50
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Net Asset Value as of 4/30/95: $12.95
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Yield on Closing Stock Price as of 4/30/95 ($12.50)1: 6.30%
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Current Monthly Distribution per Share2: $0.0656
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Current Annualized Distribution per Share2: $0.7872
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1Yield on Closing Stock Price is calculated by dividing the current annualized
distribution per share by the closing stock price per share.
2The distribution is not constant and is subject to change.
4
<PAGE>
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The BlackRock California Investment
Quality Municipal Trust Inc.
Portfolio of Investments
April 30, 1995
(Unaudited)
<TABLE>
<CAPTION>
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Principal
Amount Value
Rating* (000) Description (Note 1)
- ----------------------------------------------------------------------------------------------------------------------------
LONG-TERM INVESTMENTS-156.9%
<S> <C> <C> <C>
AAA $1,000 Anaheim Pub. Fin. Auth. Rev., Elec. Util. Projs., 5.55%, 10/01/12, MBIA ...................... $ 941,410
A+ 1,250 California St., G.O., 6.40%, 2/01/20 ......................................................... 1,210,675
California St. Hsg. Fin. Agcy. Rev.,
AA- 1,000 Ser. B-1, 6.45%, 2/01/11 ................................................................... 1,012,640
AA- 1,000 Home Mtge., Ser. G, 7.20%, 8/01/14 ......................................................... 1,063,350
California St. Pub. Wks. Brd. Lease, Rev.
A- 1,000 St. Univ. Proj., Ser. A, 6.10%, 10/01/06 ................................................... 1,017,220
AAA 1,000 St. Univ. Proj., Ser. A, 6.40%, 12/01/16, AMBAC ............................................ 1,021,470
A- 1,000 Dep. of Corrections, Ser. A., 6.875%, 11/01/14 ............................................. 1,037,420
AAA 1,000 Los Angeles Dept. Wtr. & Pwr., Electric Plant Rev., 5.375%, 9/01/23, MBIA .................... 887,980
AA 1,000 Los Angeles Sanit. Dist. Fin. Auth. Rev., Solid Waste Res., 5.375%, 10/01/13 ................. 908,040
AAA 1,000 Los Angeles Waste Wtr. Sys. Rev., Ser. B, 5.50%, 6/01/13, MBIA ............................... 937,850
A 1,000 MSR Pub. Pwr. Agcy, San Juan Proj., Ser. C, 6.875%, 7/01/19 .................................. 1,031,340
AAA 1,220 Northern California Transm. Rev., Ser. A, 5.50%, 5/01/14, MBIA ............................... 1,136,979
AAA 1,000 Orange Cnty. Arpt. Dev. Rev., 5.50%, 7/01/13, MBIA............................................ 901,040
AAA 1,000 Sacramento Utility Dist. Elec. Rev., Ser. E, 5.70%, 5/15/12, MBIA ............................ 959,960
AAA 1,000 San Francisco City & Cnty. Arpt. Comn. Rev., Intl. Arpt., Ser. 6, 6.125%, 5/01/09, AMBAC ..... 1,002,760
AA 1,000 San Francisco City & Cnty. Pub. Utils. Comn. Wtr. Rev., Ser. A, 6.00%, 11/01/15 .............. 978,090
BBB 750 San Joaquin Hills Trans. Corridor Agcy. Toll Rd. Rev., 6.75%, 1/01/32 ........................ 728,138
AAA 1,000 San Jose Redev. Agcy. Tax Alloc., 5.25%, 8/01/16, MBIA ....................................... 890,670
AAA 1,000 Santa Cruz Cnty. Pub. Fin. Auth.Rev., Tax Alloc., Ser. A, 5.25%, 9/01/15, MBIA ............... 893,040
AA- 1,000 Southern California Pub. Pwr. Auth. Transm. Proj. Rev., 5.50%, 7/01/20 ....................... 901,880
AAA 1,000 Univ. of California Rev., Ser. D, 6.10%, 9/01/10, MBIA ....................................... 1,011,230
-----------
Total long-term investments (cost $20,351,705) 20,473,182
-----------
SHORT-TERM INVESTMENT**-5.4%
A1+ 700 California St. Hlth. Facs. Fin. Auth. Rev., Sutter Hlth. Sys., Ser. A, 5.00%, 5/01/95, FRDD
(cost $700,000) ............................................................................ 700,000
-----------
Total Investments-162.3% (cost $21,051,705) .................................................. 21,173,182
Liabilities in excess of other assets-(4.8)% ................................................. (629,382)
Liquidation value of preferred stock-(57.5)% ................................................. (7,500,000)
-----------
Net Assets Applicable to Common Shareholders-100% ............................................ $13,043,800
===========
<FN>
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* Rating: using the higher of Standard & Poor's, Moody's or Fitch's rating.
** For purposes of amortized cost valuation, the maturity date of this instrument 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.
</FN>
</TABLE>
<TABLE>
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Key to Abbreviations
<S> <C> <C> <C>
AMBAC -American Municipal Bond Assurance Corporation G.O. -General Obligation Bond
FRDD -Floating Rate Daily Demand** MBIA -Municipal Bond Insurance Association
- -----------------------------------------------------------------------------------------------------------
</TABLE>
See Notes to Financial Statements.
5
<PAGE>
(Left Column)
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The BlackRock California Investment
Quality Municipal Trust Inc.
Statement of Assets and Liabilities
April 30, 1995
(Unaudited)
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<TABLE>
<S> <C>
Assets
Investments, at value (cost $21,051,705) (Note 1) ... $21,173,182
Cash ................................................ 18,016
Interest receivable ................................. 385,912
Deferred organization expenses and other assets ..... 10,682
-----------
21,587,792
-----------
Liabilities
Payable for investments purchased ................... 1,002,348
Advisory fee payable (Note 2) ....................... 6,009
Dividends payable-preferred stock ................... 5,454
Dividends payable-common stock ...................... 3,411
Administration fee payable (Note 2) ................. 1,717
Other accrued expenses .............................. 25,053
-----------
1,043,992
-----------
Net Investment Assets $20,543,800
===========
Net investment assets were comprised of:
Common stock:
Par value (Note 4) .................................. $ 10,071
Paid-in capital in excess of par .................... 13,897,103
Preferred stock (Note 4) ............................ 7,500,000
-----------
21,407,174
Undistributed net investment income ................. 147,478
Accumulated net realized loss ....................... (1,132,329)
Net unrealized appreciation ......................... 121,477
-----------
Net investment assets, April 30, 1995 ............... $20,543,800
===========
Net assets applicable to common shareholders ........ $13,043,800
===========
Net asset value per share:
($13,043,800 / 1,007,093 shares of common
stock issued and outstanding) ..................... $12.95
======
</TABLE>
(Right Column)
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The BlackRock California Investment
Quality Municipal Trust Inc.
Statement of Operations
Six Months Ended April 30, 1995
(Unaudited)
- ------------------------------------------------------------------
<TABLE>
<S> <C>
Net Investment Income
Income
Interest and discount earned......................... $ 627,277
---------
Expenses
Investment advisory.................................. 33,407
Reports to shareholders.............................. 12,500
Administration....................................... 9,545
Directors............................................ 6,000
Transfer agent....................................... 5,000
Audit................................................ 3,500
Legal................................................ 2,500
Custodian............................................ 1,500
Miscellaneous........................................ 16,430
---------
Total expenses....................................... 90,382
---------
Net investment income................................ 536,895
---------
Realized and Unrealized Gain (Loss)
on Investments (Note 3)
Net realized loss on investments..................... (150,089)
Net change in unrealized appreciation on
investments........................................ 1,363,850
---------
Net gain on investments.............................. 1,213,761
---------
Net Increase In Net Investment
Assets Resulting from Operations..................... $1,750,656
==========
</TABLE>
See Notes to Financial Statements.
6
<PAGE>
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The BlackRock California Investment Quality Municipal Trust Inc.
Statements of Changes in Net Investment Assets
(Unaudited)
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<TABLE>
<CAPTION>
For the For the
Six Months Year
Ended Ended
Increase (Decrease)in Net Investment Assets April 30, 1995 October 31, 1994
-------------- ----------------
Operations:
<S> <C> <C>
Net investment income .......................................................... $ 536,895 $ 1,043,684
Net realized loss on investments ............................................... (150,089) (982,210)
Net change in unrealized appreciation (depreciation) on investments ............ 1,363,850 (2,049,564)
---------- -----------
Net increase (decrease) in net investment assets resulting from operations ..... 1,750,656 (1,988,090)
Dividends and distributions:
To common shareholders from net investment income .............................. (396,385) (792,772)
To preferred shareholders from net investment income ........................... (135,977) (182,317)
To common shareholders from capital gains ...................................... - (25,882)
To preferred shareholders from capital gains ................................... - (5,503)
Capital stock transactions:
Capital charge with respect to initial public offering of shares ............... - (16,356)
---------- -----------
Total increase (decrease) 1,218,294 (3,010,920)
Net Investment Assets
Beginning of period ............................................................ 19,325,506 22,336,426
---------- -----------
End of period .................................................................. $20,543,800 $19,325,506
=========== ===========
</TABLE>
See Notes to Financial Statements.
7
<PAGE>
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The BlackRock California Investment Quality Municipal Trust Inc.
Financial Highlights
(Unaudited)
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<TABLE>
<CAPTION>
<S> <C> <C> <C>
For the For the For the Period
Six Months Year June 4, 1993*
Ended Ended Through
PER SHARE OPERATING PERFORMANCE: April 30, 1995 October 31, 1994 October 31, 1993
-------------- ---------------- ----------------
Net asset value, beginning of period............................................ $ 11.74 $ 14.73 $ 14.10
-------- -------- --------
Net investment income......................................................... .53 1.04 .31
Net realized and unrealized gain (loss) on investments........................ 1.21 (3.01) .83
-------- -------- --------
Net increase (decrease) from investment operations.............................. 1.74 (1.97) 1.14
-------- -------- --------
Dividends from net investment income to:
Common shareholders........................................................... (.39) (.79) (.20)
Preferred shareholders........................................................ (.14) (.18) (.04)
-------- -------- --------
Total dividends............................................................... (.53) (.97) (.24)
-------- -------- --------
Distributions from capital gains to:
Common shareholders........................................................... - (.03) -
Preferred shareholders........................................................ - (.01) -
-------- -------- --------
Total distributions........................................................... - (.04) -
-------- -------- --------
Capital charge with respect to issuance of common and preferred stock........... - (.01) (.27)
-------- -------- --------
Net asset value, end of period**................................................ $ 12.95 $ 11.74 $ 14.73#
======== ======== ========
Per share market value, end of period**......................................... $ 12.50 $ 10.625 $ 14.00
======== ======== ========
TOTAL INVESTMENT RETURN(D):..................................................... 21.71% (18.85)% .68%
RATIOS TO AVERAGE NET ASSETS OF COMMON SHAREHOLDERS(D)(D):
Expenses........................................................................ 1.48%(D)(D)(D) 1.25% 1.07%(D)(D)(D)
Net investment income........................................................... 8.81%(D)(D)(D) 7.81% 5.31%(D)(D)(D)
SUPPLEMENTAL DATA:
Average net assets of common shareholders (in thousands)........................ $ 12,294 $ 13,362 $ 14,504
Portfolio turnover rate......................................................... 63% 184% 13%
Net assets of common shareholders, end of period (in thousands)................. $ 13,044 $ 11,826 $ 14,836
Asset coverage per share of preferred stock, end of period...................... $136,959 $128,837 $148,910
-------- -------- --------
Preferred stock outstanding (in thousands)...................................... $ 7,500 $ 7,500 $ 7,500
<FN>
- --------------
* Commencement of investment operations.
** Net asset value and market value are published in The Wall Street
Journal each Monday.
# Net asset value immediately after the closing of the first public
offering was $14.01.
(D) Total investment return is calculated assuming a purchase of common
stock at the current market value on the first day and a sale at the
current market value on the last day of each period reported.
Dividends and distributions are assumed for purposes of this
calculation to be reinvested at prices obtained under the Trust's
dividend reinvestment plan. This calculation does not reflect
brokerage commissions. Total investment returns for periods of less
than one year are not annualized. (D)(D) Ratios calculated on the
basis of income and expenses applicable to both the common and
preferred shares relative to the average net assets of common
shareholders. Ratios do not reflect the effect of dividend payments to
preferred shareholders.
(D)(D)(D) 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
period indicated. This information has been determined based upon
financial information provided in the financial statements and market
value data for the Trust's common stock.
</FN>
</TABLE>
See Notes to Financial Statements.
8
<PAGE>
(left column)
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The BlackRock California Investment
Quality Municipal Trust Inc.
Notes to Financial Statements
(Unaudited)
- --------------------------------------------------------------------------------
Note 1. Accounting Policies
The BlackRock California Investment Quality Municipal Trust Inc. (the "Trust")
was organized in Maryland on April 12, 1993 as a non-diversified closed-end
management investment company. The Trust had no transactions until May 27, 1993
when it sold 7,093 shares of common stock for $100,012 to BlackRock Financial
Management, Inc., (the "Adviser"). Investment operations commenced on June 4,
1993.
The Trust's investment objective is to provide high current income exempt from
regular federal and California state income taxes 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 the
state, 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.
Option Selling/Purchasing: When the Trust sells or purchases an option, an
amount equal to the premium received or paid by the Trust is recorded as a
liability or an asset and is
(right column)
subsequently adjusted to the current market value of the option written or
purchased. Premiums received or paid from writing or purchasing options which
expire unexercised are treated by the Trust on the expiration date as realized
gains or losses. The difference between the premium and the amount paid or
received on effecting a closing purchase or sale transaction, including
brokerage commissions, is also treated as a realized gain or loss. If an option
is exercised, the premium paid or received is added to the proceeds from the
sale or cost of the purchase in determining whether the Trust has realized a
gain or a loss on investment transactions. The Trust, as writer of an option,
may have no control over whether the underlying securities may be sold (call) or
purchased (put) and as a result bears the market risk of an unfavorable change
in the price of the security underlying the written option.
Financial Futures Contracts: A futures contract is an agreement between two
parties to buy and sell a financial instrument for a set price on a future date.
Initial margin deposits are made upon entering into futures contracts and can be
either cash or securities. During the period the futures contract is open,
changes in the value of the contract are recognized as unrealized gains or
losses by "marking-to-market" on a daily basis to reflect the market value of
the contract at the end of each day's trading. Variation margin payments are
made or received, depending upon whether unrealized gains or losses are
incurred. When the contract is closed, the Trust records a realized gain or loss
equal to the difference between the proceeds from (or cost of) the closing
transaction and the Trust's basis in the contract.
Financial futures contracts, when used by the Trust, help in maintaining a
targeted duration. Duration is a measure of the price sensitivity of a security
or a portfolio to relative changes in interest rates. For instance, a duration
of "one" means that a portfolio's or a security's price would be expected to
change by approximately one percent with a one percent change in interest rates,
while a duration of "five" would imply that the price would move approximately
five percent in relation to a one percent change in interest rates. Futures
contracts can be sold to effectively shorten an otherwise longer duration
portfolio. In the same sense, futures contracts can be purchased to lengthen a
portfolio that is shorter than its duration target. Thus, by buying or selling
futures contracts, the Trust can effectively "hedge" more volatile positions so
that changes in interest rates do not change the duration of the portfolio
unexpectedly.
The Trust may invest in financial futures contracts primarily for the purpose
of hedging its existing portfolio securities or
9
<PAGE>
(left column)
securities the Trust intends to purchase against fluctuations in value caused by
changes in prevailing market interest rates. Should interest rates move
unexpectedly, the Trust may not achieve the anticipated benefits of the
financial futures contracts and may realize a loss. The use of futures
transactions involves the risk of imperfect correlation in movements in the
price of futures contracts, interest rates and the underlying hedged assets. The
Trust is also at risk of not being able to enter into a closing transaction for
the futures contract because of an illiquid secondary market. In addition, since
futures are used to shorten or lengthen a portfolio's duration, there is a risk
that the portfolio may have temporarily performed better without the hedge or
that the Trust may lose the opportunity to realize appreciation in the market
price of underlying positions.
Short Sales: The Trust may make short sales of securities as a method of hedging
potential price declines in similar securities owned. When the Trust makes a
short sale, it may borrow the security sold short and deliver it to the
broker-dealer through which it made the short sale as collateral for its
obligation to deliver the security upon conclusion of the sale. The Trust may
have to pay a fee to borrow the particular securities and may be obligated to
pay over any payments
received on such borrowed securities. A gain, limited to the price at which the
Trust sold the security short, or a loss, unlimited as to dollar amount, will be
recognized upon the termination of a short sale if the market price is greater
or less than the proceeds originally received.
Securities Transactions and Investment Income: Securities transactions are
recorded on the trade date. Realized and unrealized gains and losses are
calculated on the identified cost basis. Interest income is recorded on the
accrual basis and the Trust accretes discounts 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. Therefore 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.
(right column)
Deferred Organization Expenses: A total of $16,000 was incurred in connection
with the organization of the Trust. These costs have been deferred and are being
amortized ratably over a period of sixty months from the date the Trust
commenced investment operations.
Note 2. Agreements
The Trust has an Investment Advisory Agreement with the Adviser and an
Administration Agreement with Prudential Mutual Fund Management, Inc. ("PMF"),
an indirect, wholly-owned subsidiary of The Prudential Insurance Company of
America.
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 PMF is also computed weekly and payable monthly
at an annual rate of 0.10% 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. PMF pays occupancy and certain clerical and
accounting costs of the Trust. The Trust bears all other costs and expenses.
On February 28, 1995, the advisor was acquired by PNC Bank, N.A. As a result,
the Adviser is a wholly-owned corporate subsidiary of PNC Asset Management
Group, Inc., the holding company for PNC's asset management businesses.
Note 3. Portfolio Securities
Purchases and sales of investment securities, other than short-term investments,
for the period ended April 30, 1995 aggregated $12,184,790 and $12,603,397,
respectively.
The federal income tax basis of the Trust's investments at April 30, 1995 was
substantially the same as the basis for financial reporting and, accordingly,
net unrealized depreciation for federal income tax purposes, was $121,477 (gross
unrealized appreciation-$444,274; gross unrealized depreciation-$322,797).
For federal income tax purposes, the Trust had a capital loss carryforward at
October 31, 1994 of approximately $982,000 which will expire in 2002.
Accordingly, no capital gain distribution is expected to be paid to shareholders
until net gains have been realized in excess of such amount.
10
<PAGE>
(left column)
Note 4. Capital
There are 200 million shares of $.01 par value common stock authorized. Of the
1,007,093 shares outstanding at April 30, 1995, the Adviser owned 7,093 shares.
Offering costs ($104,994) incurred in connection with the Trust's underwriting
of common stock have been charged to paid-in capital in excess of par of the
common stock.
The Trust may classify or reclassify any unissued shares of common stock into
one or more series of preferred stock. On July 29, 1993 the Trust reclassified
150 shares of common stock and issued a series of Auction Market Preferred Stock
("Preferred Stock") Series W7. The Preferred Stock has a liquidation value of
$50,000 per share plus any accumulated but unpaid dividends.
Underwriting discounts ($112,500) and offering costs ($75,344) incurred in
connection with the Preferred Stock offering have been charged to paid-in
capital in excess of par of the common stock.
Dividends on Series W7 are cumulative at a rate which is reset every 7 days
based on the results of an auction. Dividend rates ranged from 3.00% to 4.99%
during the period ended April 30, 1995.
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
(right column)
$50,000 per share plus any accumulated or unpaid dividends whether or not
declared. The Preferred Stock is also subject to mandatory redemption at $50,000
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.
On May 16, 1995 shareholders approved a proposal to split each share of the
Trust's Auction Rate Municipal Preferred Stock into two shares and
simultaneously reduce each share's liquidation preference from $50,000 to
$25,000.
Note 5. Dividends
Subsequent to April 30, 1995, the Board of Directors of the Trust declared a
dividend from undistributed earnings of $0.0656 per common share payable May 31,
1995 to shareholders of record on May 15, 1995.
For the period May 1, 1995 to May 31, 1995, dividends declared on Preferred
Stock totalled $25,919 in aggregate for the outstanding Preferred Stock.
11
<PAGE>
Note 6. Quarterly Data
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
Net realized Net increase/decrease Dividends
and unrealized in net investment and distributions
Net investment gains (losses) assets resulting Common Preferred
income on investments from operations Shares Shares** Period
Per Per Per Per Per Share price of end
Quarterly Total Common Common Common Common Common Common stock net asset
period income Amount share Amount share Amount share Amount share Amount share High Low value
- --------- ------ ------ ------ ------ ------ ------ ------ ------ ----- ------ ------ ---- --- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
June 4, 1993*
to
July 31, 1993 $ 90,374 $ 69,192 $.07 $ (8,976) $(.01) $ 60,216 $ .06 - - $ 1,264 - $15-1/8 $14-1/2 $13.88
August 1, 1993
to
October 31, 1993 289,863 247,308 .24 847,522 .84 1,094,830 1.08 $198,196 $.20 42,690 $.04 15-1/8 14 14.73
November 1, 1993
to
January 31, 1994 301,401 260,542 .26 112,026 .11 372,568 .37 224,076 .22 43,587 .05 14-1/4 12-7/8 14.84
February 1, 1994
to
April 30, 1994 298,390 258,532 .26(2,288,516) (2.27)(2,029,984)(2.01) 198,195 .20 41,050 .04 13-3/4 11-1/4 12.58
May 1, 1994
to
July 31, 1994 302,866 260,859 .26 377,218 .37 638,077 .63 198,193 .20 48,416 .05 12 11-1/4 12.97
August 1, 1994
to
October 31, 1994 307,462 263,751 .26(1,232,502) (1.22) (968,751) (.96) 198,190 .20 54,767 .05 11-3/4 9-7/8 11.74
November 1, 1994
to
January 31, 1995 314,677 272,661 .27 505,599 .50 778,260 .77 198,190 .19 68,381 .07 11-1/4 9-7/8 12.25
February 1, 1995
to
April 30, 1995 312,600 264,234 .26 708,162 .71 972,396 .97 198,195 .20 67,596 .07 12-1/2 11-3/8 12.95
- ------------------------------------------------------------------------------------------------------------------------------------
<FN>
**Commencement of investment operations.
**For the six months ended April 30, 1995 the average annualized rate paid to preferred shareholders was 3.66%.
</FN>
</TABLE>
12
<PAGE>
- --------------------------------------------------------------------------------
THE BLACKROCK CALIFORNIA INVESTMENT QUALITY MUNICIPAL TRUST INC.
DIVIDEND REINVESTMENT PLAN
- --------------------------------------------------------------------------------
Pursuant to the Trust's Dividend Reinvestment Plan (the "Plan"),
shareholders will automatically have all distributions of dividends and capital
gains reinvested by State Street Bank & Trust Company (the "Plan Agent") in
Trust shares pursuant to the Plan unless an election is made to receive such
amounts in cash. The Plan Agent will effect purchases of shares under the Plan
in the open market. 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 in connection with the Plan.
Participants in the Plan may withdraw from the Plan upon written notice to
the Plan Agent and will receive certificates for whole Trust shares and a cash
payment for any fraction of a Trust share.
The Plan Agent's fees for the handling of the reinvestment of dividends and
distributions will be paid by the Trust. However, each participant will pay a
pro rata share of brokerage commissions incurred with respect to the Plan
Agent's open market purchases in connection with the reinvestment of dividends
and distributions. The automatic reinvestment of dividends and distributions
will not relieve participants of any federal, state or local income taxes that
may be payable on such dividends or distributions.
Experience under the Plan may indicate that changes are desirable.
Accordingly, 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 by the Plan
Agent upon at least 90 days' written notice to all shareholders of the Trust.
The Plan may be terminated by the Plan Agent or the Trust upon at least 30 days
written notice to all shareholders of the Trust. All correspondence concerning
the Plan should be directed to the Plan Agent at (800) 699-1BFM. The addresses
are on the front of this report.
- --------------------------------------------------------------------------------
ADDITIONAL INFORMATION
- --------------------------------------------------------------------------------
There have been no material changes in the Trust's investment objectives or
policies that have not been approved by the shareholders, or to its charter or
by-laws, or in the principal risk factors associated with investment in the
Trust. There have been no changes in the persons who are primarily responsible
for the day-to-day management of the Trust's portfolio.
At a Special Meeting of Trust Shareholders held on February 15, 1995 to
approve the Trust's advisory agreement with BlackRock Financial Management, Inc.
Shareholders approved the agreement. The result of the voting is as follows:
Votes For ....................................... 816,127
Votes Against ................................... 25,450
Votes Withheld .................................. 27,734
The Annual Meeting of Trust Shareholders was held May 16, 1995 to vote on
the following matters:
(1) To elect the following three Directors to serve as follows:
Director Class Term Expiring
-------- ----- ---- --------
James Grosfeld ....................... I 3 years 1998
James Clayburn La Force, Jr. ......... I 3 years 1998
Kent Dixon ........................... III 2 years 1997
and to elect Richard E. Cavanagh as a Class I Director to represent the
preferred shareholders for a three year term expiring in 1998.
Directors whose term of office continues beyond this meeting are Andrew F.
Brimmer, Frank J. Fabozzi, Laurence D. Fink and Ralph L.Schlosstein.
(2) To consider and act on a proposal to split each share of the Trust's
Auction Rate Preferred Stock (Preferred) into two shares and simultaneously
reduce each share's liquidation preference, as provided in the Trust's Articles
Supplementary, from $50,000 to $25,000.
(3) To ratify the selection of Deloitte & Touche LLP as independent public
accountants of the Trust for the fiscal year ending October 31, 1995.
Shareholders elected the four Directors, approved the proposal to split each
Preferred share into two shares and ratified the selection of Deloitte & Touche
LLP. The results of the voting was as follows:
Votes* For Votes* Against Votes* Withheld
James Grosfeld 626,465 - 126,958
James Clayburn La Force, Jr. 626,465 - 126,958
Kent Dixon 626,465 - 126,958
Richard E. Cavanagh 134 - -
Preferred share split 597,334 132,790 23,299
Deloitte & Touche LLP 722,790 14,216 16,417
- ----------------
*The votes represent common and preferred shareholders voting as a single class
except for the election of Richard E. Cavanagh who was elected by the preferred
shareholders.
13
<PAGE>
- --------------------------------------------------------------------------------
THE BLACKROCK CALIFORNIA INVESTMENT QUALITY MUNICIPAL TRUST INC.
INVESTMENT SUMMARY
- --------------------------------------------------------------------------------
The Trust's Investment Objective
The BlackRock California Investment Quality Municipal Trust's investment
objective is to provide high current income exempt from regular Federal and
California income tax consistent with the preservation of capital.
Who Manages the Trust?
BlackRock Financial Management, Inc. ("BlackRock" or the "Adviser") is the
investment adviser for the Trust. BlackRock is a registered investment adviser
specializing in fixed income securities. Currently, BlackRock manages over $27
billion of assets across the government, mortgage, corporate and municipal
sectors. These assets are managed on behalf of institutional and individual
investors in 21 closed-end funds, several open-end funds and over 75 separate
accounts for various clients in the U.S. and overseas. BlackRock is a subsidiary
of PNC Asset Management Group which is a division of PNC Bank, N.A., the
nation's twelfth largest banking organization.
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 investment grade ("BBB" by
Standard & Poor's and "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.
The Trust intends to invest substantially all of the assets in a portfolio of
investment grade California Municipal Obligations, which include debt
obligations issued by or on behalf of California, its political subdivisions,
agencies and instrumentalities and by other qualifying issuers that pay interest
which, in the opinion of the bond counsel of the issuer, is exempt from regular
Federal and California income tax. California Municipal Obligations are issued
to obtain funds for various public functions, including the construction of
public facilities, the refinancing of outstanding obligations, the obtaining of
funds for general operating expenses and for loans to other public institutions
and facilities.
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 investment grade California Municipal Obligations. The Adviser actively
manages the assets in relation to market conditions and interest rate changes.
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). The Trust intends to
emphasize investments in California Municipal Obligations with long-term
maturities and expects to maintain an average portfolio maturity of 15-20 years,
but the average maturity may be shortened or lengthened from time to time
depending on market conditions.
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. See "Leverage Considerations in the Trust"
below.
How Are the Trust's Shares Purchased and Sold?
Does the Trust Pay Dividends Regularly?
The Trust's shares are traded on the American 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, Boston
Financial Data Services. 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 fund in a declining rate environment, but can cause net
assets to decline faster in a rapidly rising interest
14
<PAGE>
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.
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 and California 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 American Stock Exchange (AMEX symbol: RAA) 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.
15
<PAGE>
- --------------------------------------------------------------------------------
THE BLACKROCK CALIFORNIA INVESTMENT QUALITY MUNICIPAL TRUST INC.
GLOSSARY
- --------------------------------------------------------------------------------
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 the Trust.
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 and The New
York Times or The Wall Street Journal each 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.
16
<PAGE>
- --------------------------------------------------------------------------------
BLACKROCK FINANCIAL MANAGEMENT, INC.
SUMMARY OF CLOSED-END FUNDS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Taxable Trusts
- ------------------------------------------------------------------------------------------
Stock Maturity
Perpetual Trusts Symbol Date
------ --------
<S> <C> <C>
The BlackRock Income Trust Inc. BKT N/A
The BlackRock North American Government Income Trust Inc. BNA N/A
Term Trusts
The BlackRock 1998 Term Trust Inc. BBT 12/98
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
Tax-Exempt Trusts
- ------------------------------------------------------------------------------------------
Stock Maturity
Perpetual Trusts Symbol Date
------ --------
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 call BlackRock at (800) 227-7BFM (7236)
or consult with your financial advisor.
17
<PAGE>
- --------------------------------------------------------------------------------
BLACKROCK FINANCIAL MANAGEMENT, INC.
AN OVERVIEW
- --------------------------------------------------------------------------------
BlackRock Financial Management, Inc. (BlackRock) is a registered investment
adviser which specializes in managing high quality fixed income securities, both
taxable and tax exempt. BlackRock currently manages over $27 billion of net
assets in 111 portfolios of government, mortgage, corporate and municipal
securities. These assets are managed on behalf of many individual investors in
twenty-one closed-end funds and several open-end funds and on behalf of more
than 75 institutional clients in the United States and overseas. BlackRock's
institutional investor base includes Chrysler Corporation Master Retirement
Trust, General Retirement System of the City of Detroit, State Treasurer of
Florida, General Electric Pension Trust and Unisys Corporation Master Trust.
BlackRock was formed in April 1988 by fixed income professionals who sought
to create an asset management firm specializing in managing fixed income
securities for individuals and institutional investors. The professionals at
BlackRock have extensive experience creating, analyzing and trading a variety of
fixed income instruments, including the most complex structured securities. In
fact, individuals at BlackRock are responsible for many of the major innovations
in the mortgage-backed and asset-backed securities markets, including the
creation of the 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
significant emphasis it places on the development of proprietary analytical
capabilities. A quarter of the professionals at BlackRock work full-time in the
design, maintenance and use of such systems which are otherwise not generally
available to investors. BlackRock's proprietary analytical tools are used for
evaluating, investing in and designing investment strategies and portfolios of
fixed income securities, including mortgage securities, corporate debt
securities or tax-exempt securities and a variety of hedging instruments.
BlackRock has developed investment products which respond to investors'
needs and has been responsible for several major innovations in closed-end
funds. 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 AAAf rating by Standard & Poor's, and the first
closed-end fund to invest primarily in North American Government securities.
BlackRock's closed-end funds currently have dividend reinvestment plans which
are designed to provide an ongoing source of demand for the stock in the
secondary market. BlackRock manages a ladder of alternative investment vehicles,
with each fund 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
you may have about your BlackRock funds and thank you for the continued trust
you place in our abilities.
If you would like further information
please call BlackRock at (800) 227-7BFM
18
<PAGE>
(Left Column)
- ---------
BlackRock
- ---------
Directors
Laurence D. Fink, Chairman
Andrew F. Brimmer
Richard E. Cavanagh
Kent Dixon
Frank J. Fabozzi
James Grosfeld
James Clayburn La Force, Jr.
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
Prudential Mutual Fund Management, Inc.
One Seaport Plaza
New York, NY 10292
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
919 Third Avenue
New York, NY 10022
The accompanying financial statements as of
April 30, 1995 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 California Investment
Quality Municipal Trust Inc.
c/o Prudential Mutual Fund Management, Inc.
32nd Floor
One Seaport Plaza
New York, NY 10292
(800) 227-7BFM
09247U-10-7
09247U-20-6
(Right Column)
- -----------------------------
- -----------------------------
The BlackRock
California
Investment Quality
Municipal Trust Inc.
- -----------------------------
Semi-Annual Report
April 30, 1995
