MUNIVEST
PENNSYLVANIA
INSURED
FUND
Semi-Annual Report April 30, 1994
This report, including the financial information herein, is
transmitted to the shareholders of MuniVest Pennsylvania
Insured Fund 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 re-
port. Past performance results shown in this report should
not be considered a representation of future performance.
The Fund has leveraged its Common Shares by issuing Pre-
ferred Shares to provide Common Shareholders with a poten-
tially higher rate of return. Leverage creates risks for
Common Shareholders, including the likelihood of greater
volatility of net asset value and market price of the Com-
mon Shares, and the risk that fluctuations in the short-
term dividend rates of the Preferred Shares may affect the
yield to Common Shareholders.
MuniVest Pennsylvania Insured Fund
Box 9011
Princeton, NJ
08543-9011
<PAGE>
MUNIVEST PENNSYLVANIA INSURED FUND
The Benefits and
Risks of
Leveraging
MuniVest Pennsylvania Insured Fund utilizes leveraging to seek
to enhance the yield and net asset value of its Common Shares.
However, these objectives cannot be achieved in all interest rate
environments. To leverage, the Fund issues Preferred Shares,
which pay 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 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 Com-
mon Shares. However, in order to benefit Common Shareholders, the
yield curve must be positively sloped; that is, short-term inter-
est rates must be lower than long-term interest rates. At the same
time, a period of generally declining interest rates will benefit
Common 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 Share capital-
ization of $100 million and the issuance of Preferred Shares for an
additional $50 million, creating a total value of $150 million avail-
able 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 Shares 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.
In this case, the dividends paid to Preferred Shareholders are sig-
nificantly lower than the income earned on the fund's long-term in-
vestments, and therefore the Common Shareholders are the beneficiar-
ies of the incremental yield. However, if short-term interest rates
rise, narrowing the differential between short-term and long-term in-
terest rates, the incremental yield pick-up on the Common Shares will
be reduced. At the same time, the market value of the fund's Common
Shares (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 Shares' net asset value will reflect the full decline
in the price of the portfolio's investments, since the value of the
fund's Preferred Shares does not fluctuate. In addition to the decline
in net asset value, the market value of the fund's Common Shares may
also decline.
<PAGE>
Officers and
Trustees
Arthur Zeikel, President and Trustee
Kenneth S. Axelson, Trustee
Herbert I. London, Trustee
Robert R. Martin, Trustee
Joseph L. May, Trustee
Andre F. Perold, Trustee
Terry K. Glenn, Executive Vice President
Donald C. Burke, Vice President
Vincent R. Giordano, Vice President
Kenneth A. Jacob, Vice President
Gerald M. Richard, Treasurer
Mark B. Goldfus, Secretary
Robert E. Putney, III, Assistant Secretary
Transfer Agent
Common Shares:
The Bank of New York
101 Barclay Street
New York, New York 10286
Preferred Shares:
IBJ Schroder Bank & Trust Company
One State Street
New York, New York 10004
Custodian
The Bank of New York
110 Washington Street
New York, New York 10286
NYSE Symbol
MVP
<PAGE>
DEAR SHAREHOLDER
For the six-month period ended April 30, 1994, the Common Shares
of MuniVest Pennsylvania Insured Fund earned $0.490 per share in-
come dividends, which includes earned and unpaid dividends of
$0.069. This represents a net annualized yield of 7.97%, based on
a month-end per share net asset value of $12.39. Over the same
period, the total investment return on the Fund's Common Shares
was -12.65%, based on a change in per share net asset value from
$14.70 to $12.39, and assuming reinvestment of $0.502 per share
income dividends.
For the six-month period ended April 30, 1994, the Fund's Auc-
tion Market Preferred Shares had an average yield of 2.90%.
The Environment
Inflationary expectations and investor sentiment changed for the
worse during the three-month period ended April 30, 1994. Follow-
ing stronger-than-expected economic results through year-end 1993,
the Federal Reserve Board broke with tradition on February 4, 1994
and publicly announced a modest 25 basis point (0.25%) increase in
short-term interest rates. At the March 22, 1994 meeting of the
Federal Open Market Committee, the Federal Reserve Board again
raised the Federal Funds rate by 25 basis points, followed by an-
other 25 basis point increase on April 18, 1994.
Rather than view the Federal Reserve Board's first tightening move
as a preemptive strike against inflation, fixed-income investors
focused on Chairman Greenspan's implicit promise of further tight-
ening should the rate of inflation accelerate, and bond prices
declined sharply. The setback in the bond market was also reflec-
ted in greater stock market volatility. While the second and
third increases in the Federal Funds rate were less of a surprise,
investors remained concerned that interest rates would trend up-
ward sharply as the central bank aggressively attempted to contain
the inflationary pressures of an improving economy. At the same
time, highly leveraged investors were forced to liquidate posi-
tions in the face of declining stock and bond prices. Investor
confidence was not restored with the announcement of the surpris-
ingly slow 2.6% gross domestic product growth rate for the first
calendar quarter of 1994. Instead, investors focused on the higher-
than-expected (but still moderate) broad inflation measures, and
became concerned that business activity was beginning to stagnate
as inflationary pressures were increasing.
<PAGE>
The volatility in the US capital makets was mirrored in inter-
national markets during the period. Political and economic devel-
opments, along with concerns of heightened global inflationary
pressures, led to a sell-off in most capital markets, especially
the emerging markets that had appreciated strongly in 1993.
The Municipal Market
During the six months ended April 30, 1994, tax-exempt bond yields
exhibited considerable volatility as they rose to their highest
level in the past two years. As measured by the Bond Buyer Reven-
ue Bond Index, the yield on newly issued municipal bonds maturing
in 30 years rose over 90 basis points to 6.42% by the end of April.
Yields on seasoned municipal revenue bonds rose by over 100 basis
points in sympathy with the equally dramatic increase in long-term
US Treasury bond yields. By the end of April, yields on US Treasury
securities rose by over 95 basis points to approximately 7.30%.
Long-term tax-exempt bond yields were essentially unchanged from
the end of October 1993 to the end of January 1994. However, on a
weekly basis, tax-exempt bond yields fluctuated by as much as 15
basis points as investors were unable to reconcile the rapid eco-
nomic growth seen late last year with continued low inflation.
Following the initial interest rate increase by the Federal Re-
serve Board in early February, municipal bond prices began to erode
in concert with taxable bond prices as investors began to sell
securities in anticipation of further interest rate increases. This
fear led investors to withdraw from the tax-exempt market. From
early February to the end of March, total assets of all tax-exempt
bond funds declined by $14 billion to $247 billion. This decline
in investor demand, coupled with fears that the robust economic
recovery seen during the fourth quarter of 1993 would continue well
into 1994, helped push municipal bond yields higher in February and
March. Attracted by tax-exempt yields in excess of 6.25%, investor
demand returned in April, allowing yields to decline approxi-
mately 15 basis points to end the April period at approximately
6.40%.
A rise in tax-exempt bond yields the magnitude of that exper-
ienced over the past six months has not been seen since 1987 when
municipal bond rates rose 250 basis points between March and Oc-
tober of that year. It is very important to note that the recent
municipal bond price declines were largely the result of consis-
tent and insistent selling pressures over the last two months. In
1987, the tax-exempt bond market was much more volatile and, at
times, chaotic as investors sought to liquidate positions without
concern for fundamental value. For the most part, the recent price
deterioration has been orderly, and the municipal bond market's
liquidity and integrity have not been challenged or jeopardized.
<PAGE>
To a large extent, the municipal bond market has continued to be
supported by its strong technical position. New-issue volume for
the last six months has been less than $105 billion. This represents
a decline of approximately 20% versus the comparable period a year
ago. This decline was expected and has been discussed in previous
shareholder reports. This reduced issuance has minimized potential
selling pressure in recent months since institutional investors
have been wary of selling appreciable amounts of securities that
they may be unable to replace later this year at any price level.
We expect this decline in issuance to continue since we anticipate
recent yield increases to significantly impact future municipal
bond issuance. Just as higher mortgage rates slow home mortgage re-
financings, the recent rise in bond yields will prevent bond re-
financings from becoming the driving force in bond issuance in
1994 as they were in 1993.
Despite recent price declines, tax-exempt securities remain among
the most attractive investment alternatives available. After the
recent yield increases, longer-term municipal securities yielded
approximately 90% of comparable US Treasury yields. Purchasers of
these municipal bonds also accrue substantial after-tax yield ad-
vantages. To investors in the 39% marginal Federal income tax
bracket, the purchase of a municipal bond yielding 6.50% repre-
sents an after-tax equivalent of 10.65%. With prevailing estimates
of 1994 inflation at no more than 3%--4%, real after-tax rates in
excess of 6.50% easily compensate longer-term investors for much
of the price volatility recently experienced.
Portfolio Strategy
Our near-term interest rate outlook is cautious, and we expect that
the municipal market will continue to be volatile over the coming
months. Nevertheless, we are optimistic that the expected slowing
of the economy during the second half of 1994 will prove to be bene-
ficial to the fixed-income markets. In particular, municipal bonds
should benefit as projected new issuance is significantly lower
than last year.
<PAGE>
In line with our short-term concerns about the market, the Fund's
cash re-serves have been increased to 5%--10% of net assets. This
will allow the Fund to purchase attractively priced Pennsylvania
securities as opportunities in the market arise. The Preferred
Shares have been locked in for one year at a rate of 2.90% since
August 30, 1993, to take full advantage of the extremely steep
yield curve. The leveraging benefit, derived from the Preferred
Shares' interest rate, is expected to continue to provide the
Common Shareholder with an attractive level of tax-exempt in-
come. Dividends paid to Preferred Shareholders are significantly
lower than the income earned on the Fund's long-term invest-
ments, and therefore the Common Shareholders are the beneficiaries
of the incremental yield. Should the interest rate differential
between short-term and long-term interest rates narrow because of
a rise in short-term interest rates, the incremental yield "pick up"
on the Common Shares will be reduced. Furthermore, if long-term interest
rates rise, the Common Shares' net asset value will reflect the full
decline in the entire portfolio holdings, since the value of the
Fund's Preferred Shares does not fluctuate. During the six-month
period ended April 30, 1994, long-term interest rates rose, reflected
in the decline in the net asset value of the Fund's Common Shares.
For a complete explanation of leveraging, see page 1 of this
report to shareholders.
Sincerely,
(Arthur Zeikel)
Arthur Zeikel
President
(Vincent R. Giordano)
Vincent R. Giordano
Vice President and Portfolio Manager
May 31, 1994
Portfolio
Abbreviations
To simplify the listings of MuniVest Pennsylvania Insured
Fund'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)
IDA Industrial Development Authority
PCR Pollution Control Revenue Bonds
RIB Residual Interest Bonds
UT Unlimited Tax
VRDN Variable Rate Demand Notes
YCN Yield Curve Notes
<PAGE>
<TABLE>
SCHEDULE OF INVESTMENTS (in Thousands)
<CAPTION>
S&P Moody's Face Value
Ratings Ratings Amount Issue (Note 1a)
<S> <S> <S> <C> <S> <C>
Pennsylvania-- Allegheny County, Pennsylvania, Airport Revenue Refunding Bonds,
101.3% AMT (Pittsburgh International Airport) (e):
AAA Aaa $ 2,190 Series A, 5.625% due 1/01/2016 (b) $ 1,997
AAA Aaa 5,000 Series B, 5.625% due 1/01/2019 (c) 4,528
Allegheny County, Pennsylvania, Hospital Development Authority
Revenue Bonds:
AAA Aaa 1,550 (Magee--Women's Hospital), 5.625% due 10/01/2023 (c) 1,405
AAA Aaa 2,255 Refunding (Presbyterian Health Center), Series B, 6%
due 11/01/2023 (b) 2,159
Allegheny County, Pennsylvania, Hospital Development Authority
Revenue Bonds, VRDN (a):
A1+ VMIG1 500 (Presbyterian Health Center), Series A, 2% due 3/01/2020 500
A1+ VMIG1 100 (Presbyterian University Health System), Series D, 3.20% due
3/01/2020 100
AAA Aaa 3,000 Allegheny County, Pennsylvania, Sanitation Authority, Sewer Revenue
Bonds, 6% due 12/01/2011 (b) 2,920
AAA Aaa 1,275 Bucks County, Pennsylvania, IDA, Revenue Refunding Bonds (Grand View
Hospital), Series A, 5.25% due 7/01/2021 (d) 1,089
AAA Aaa 2,800 Delaware County, Pennsylvania, College Authority, Revenue Refunding
Bonds (Haverford College), 5.50% due 11/15/2023 (b) 2,491
Delaware County, Pennsylvania, Hospital Authority Revenue Bonds
(Crozer-Chester):
AAA Aaa 2,000 5.30% due 12/15/2020 (b) 1,722
BBB+ A 2,500 6% due 12/15/2020 2,261
AAA Aaa 3,965 Derry, Pennsylvania, Area School District Refunding Bonds, UT,
5.50% due 2/01/2021 (b) 3,561
AAA Aaa 1,930 Highland, Pennsylvania, Sewer and Water Authority Revenue Bonds,
5.35% due 9/01/2013 (e) 1,757
AAA Aaa 2,765 Lackawanna County, Pennsylvania, Revenue Refunding Bonds, UT,
6% due 12/01/2011 (d) 2,750
AAA Aaa 1,000 Lancaster County, Pennsylvania, Hospital Authority, Revenue Re-
funding Bonds (Lancaster General Hospital Project), 6.125% due
7/01/2012 (d) 984
<PAGE>
AAA Aaa 2,000 Lehigh County, Pennsylvania, IDA, PCR, Refunding (Pennsylvania
Power & Light Company Project), Series A, 6.40% due 11/01/2021 (b) 2,012
A1+ Aaa 3,500 Lehigh County, Pennsylvania, Water Authority Revenue Bonds, VRDN,
3.45% due 11/01/2004 (a)(c) 3,500
AAA Aaa 2,000 Ligonier Valley, Pennsylvania, School District Revenue Bonds, UT,
6% due 3/01/2023 (b) 1,920
AAA Aaa 4,000 North Allegheny, Pennsylvania, School District Refunding Bonds,
Series A, UT, 6.35% due 11/01/2012 (d) 4,042
Northeastern, Pennsylvania, Hospital and Educational Authority,
College Revenue Refunding Bonds:
BBB NR 1,735 (King's College Project), Series B, 6% due 7/15/2018 1,590
BBB NR 2,500 (Wilkes University), 5.625% due 10/01/2018 2,179
AAA Aaa 1,900 Pennsylvania Intergovernmental Cooperative Authority, Special
Tax Revenue Bonds (City of Philadelphia--FDG Program), 5.625%
due 6/15/2023 (b) 1,716
Pennsylvania State Higher Educational Assistance Agency Revenue
Bonds (Student Loan Revenue), AMT (d):
AAA Aaa 2,000 Series A, 7.05% due 10/01/2016 2,074
AAA Aaa 1,000 Series C, 6.40% due 3/01/2022 999
AAA Aaa 4,045 Pennsylvania State Higher Educational Facilities Authority,
College and University Revenue Refunding Bonds (Duquesne Uni-
versity Project), Series A, 5.50% due 9/01/2020 (b) 3,636
AAA Aaa 3,500 Pennsylvania State IDA, Economic Development Revenue Bonds,
6% due 1/01/2012 3,465
AAA Aaa 3,000 Pennsylvania State Turnpike Commission, Oil Franchise Tax Revenue
Bonds, Series A, 6% due 12/01/2019 (d) 2,857
BBB Baa1 2,505 Philadelphia, Pennsylvania, Gas Works Revenue Refunding Bonds,
14th Series A, 6.375% due 7/01/2014 2,467
BBB+ Baa1 1,000 Philadelphia, Pennsylvania, Hospitals and Higher Educational
Facilities Authority, Hospital Revenue Bonds (Graduate Health
Systems), Series B, 6.25% due 7/01/2018 905
Philadelphia, Pennsylvania, Water and Wastewater Revenue Re-
funding Bonds:
AAA Aaa 2,000 5.50% due 6/15/2015 1,808
AAA Aaa 3,325 5.25% due 6/15/2023 (b) 2,846
AAA Aaa 2,500 Pittsburgh, Pennsylvania, Water and Sewer Authority, Revenue
Refunding Bonds (Water and Sewer System), Series A, 6.50% due
9/01/2013 (c) 2,630
<PAGE>
BBB Baa 1,000 Ridley Park, Pennsylvania, Hospital Authority, Revenue Refunding
Bonds (Taylor Hospital), Series A, 6.125% due 12/01/2020 858
BBB+ NR 2,650 Sharon, Pennsylvania, Regional Health System Authority, Hospital
Revenue Bonds (Sharon Regional Health Systems Project), Series B,
6.875% due 12/01/2022 2,561
AAA Aaa 3,090 South Butler County, Pennsylvania, School District Revenue Bonds,
5.50% due 10/01/2017 (c) 2,807
AAA Aaa 1,000 Wayne County, Pennsylvania, Hospital and Health Facilities Authority
Revenue Bonds (Wayne Memorial Hospital Project), 6.375% due
7/01/2024 (b) 990
Puerto Rico--1.8% AAA Aaa 1,500 Commonwealth of Puerto Rico, YCN, RIB, UT, 8.882% due 7/01/2020
(e)(f) 1,393
Total Investments (Cost--$84,418)--103.1% 79,479
Liabilities in Excess of Other Assets--(3.1%) (2,414)
-------
Net Assets--100.0% $77,065
=======
<FN>
(a) The interest rate is subject to change periodically based
upon prevailing market rates. The interest rates shown are
the rates in effect at April 30, 1994.
(b) MBIA Insured.
(c) FGIC Insured.
(d) AMBAC Insured.
(e) FSA Insured.
(f) The interest rate is subject to change periodically and in-
versely to the prevailing market rate. The interest rate shown
is the rate in effect at April 30, 1994.
See Notes to Financial Statements.
</TABLE>
<PAGE>
<TABLE>
STATEMENT OF ASSETS, LIABILITIES AND CAPITAL
<CAPTION>
<S> <S> <C> <C>
Assets: Investments, at value (identified cost--$84,418,043) (Note 1a) $ 79,478,643
Cash 72,732
Receivables:
Securities sold $ 9,692,049
Interest 1,161,161
Investment adviser (Note 2) 38,951 10,892,161
------------
Deferred organization expenses (Note 1e) 59,093
Prepaid expenses and other assets 3,955
------------
Total assets 90,506,584
------------
Liabilities: Payables:
Securities purchased 13,239,592
Dividends to shareholders (Note 1g) 66,455 13,306,047
------------
Accrued expenses and other liabilities 135,309
------------
Total liabilities 13,441,356
------------
Net Assets: Net assets $ 77,065,228
============
Capital: Capital Shares (unlimited number of shares of beneficial interest authorized)
(Note 4):
Preferred Shares, par value $.10 per share (550 shares of AMPS* issued and
outstanding at $50,000 per share liquidation preference) $ 27,500,000
Common Shares, par value $.10 per share (3,999,936 shares issued and
outstanding) $ 399,993
Paid-in capital in excess of par 55,504,196
Undistributed investment income--net 306,510
Accumulated realized capital losses--net (1,706,071)
Unrealized depreciation on investments--net (4,939,400)
------------
Total--Equivalent to $12.39 net asset value per Common Share (market
price--$12.875) 49,565,228
------------
Total capital $ 77,065,228
============
* Auction Market Preferred Shares.
See Notes to Financial Statements.
</TABLE>
<PAGE>
<TABLE>
STATEMENT OF OPERATIONS
<CAPTION>
For the Six Months Ended April 30, 1994
<S> <S> <C> <C>
Investment Interest and amortization of premium and discount earned $ 2,310,232
Income
(Note 1d):
Expenses: Investment advisory fees (Note 2) $ 205,679
Professional fees 37,557
Accounting services (Note 2) 20,513
Printing and shareholder reports 19,424
Transfer agent fees 18,734
Trustees' fees and expenses 11,390
Listing fees 7,902
Amortization of organization expenses (Note 1e) 5,581
Commission fees (Note 4) 5,275
Custodian fees 3,833
Pricing fees 3,269
Other 10,934
------------
Total expenses before reimbursement 350,091
Reimbursement of expenses (Note 2) (161,021)
------------
Total expenses after reimbursement 189,070
------------
Investment income--net 2,121,162
------------
Realized & Realized loss on investments--net (1,706,069)
Unrealized Change in unrealized appreciation/depreciation on investments--net (7,192,637)
Loss on ------------
Investments-- Net Decrease in Net Assets Resulting from Operations $ (6,777,544)
Net (Notes ============
1d & 3):
See Notes to Financial Statements.
</TABLE>
<PAGE>
<TABLE>
STATEMENTS OF CHANGES IN NET ASSETS
<CAPTION>
For the Six For the Period
Months Ended July 30, 1993++
Increase (Decrease) in Net Assets: April 30, 1994 to Oct. 31, 1993
<S> <S> <C> <C>
Operations: Investment income--net $ 2,121,162 $ 981,705
Realized gain (loss) on investments--net (1,706,069) 266,982
Change in unrealized appreciation/depreciation on investments--net (7,192,637) 2,253,237
------------ ------------
Net increase (decrease) in net assets resulting from operations (6,777,544) 3,501,924
------------ ------------
Dividends Investment income--net:
& Distri- Common Shares (1,758,870) (528,319)
butions to Preferred Shares (378,466) (130,702)
Shareholders Realized gain on investments--net:
(Note 1g): Common Shares (231,438) --
Preferred Shares (35,546) --
------------ ------------
Net decrease in net assets resulting from dividends and distributions to
shareholders (2,404,320) (659,021)
------------ ------------
Common & Net proceeds from issuance of Common Shares -- 55,292,685
Preferred Proceeds from issuance of Preferred Shares -- 27,500,000
Shares Offering and underwriting costs resulting from the issuance of Preferred Shares -- (613,250)
Transactions Value of shares issued to Common Shareholders in reinvestment of dividends 878,081 246,668
(Notes 1e ------------ ------------
& 4): Net increase in net assets derived from capital share transactions 878,081 82,426,103
------------ ------------
Net Assets: Total increase (decrease) in net assets (8,303,783) 85,269,006
Beginning of period 85,369,011 100,005
------------ ------------
End of period* $ 77,065,228 $ 85,369,011
============ ============
<FN>
*Undistributed investment income--net $ 306,510 $ 322,684
============ ============
++Commencement of Operations.
See Notes to Financial Statements.
</TABLE>
<PAGE>
<TABLE>
FINANCIAL HIGHLIGHTS
<CAPTION>
The following per share data and ratios have been derived
from information provided in the financial statements. For the Six For the Period
Months Ended July 30, 1993++
Increase (Decrease) in Net Asset Value: April 30, 1994 to Oct. 31, 1993
<S> <S> <C> <C>
Per Share Net asset value, beginning of period $ 14.70 $ 14.18
Operating ------------ ------------
Performance: Investment income--net .53 .25
Realized and unrealized gain (loss) on investments--net (2.23) .64
------------ ------------
Total from investment operations (1.70) .89
------------ ------------
Less dividends and distributions to Common Shareholders:
Investment income--net (.44) (.13)
Realized gain on investments--net (.06) --
------------ ------------
Total dividends and distributions to Common Shareholders (.50) (.13)
Capital charge resulting from issuance of Common Shares -- (.05)
------------ ------------
Effect of Preferred Share activity++++:
Dividends and distributions to Preferred Shareholders:
Investment income--net (.10) (.03)
Realized gain on investments--net (.01) --
Capital charge resulting from issuance of Preferred Shares -- (.16)
------------ ------------
Total effect of Preferred Share activity (.11) (.19)
------------ ------------
Net asset value, end of period $ 12.39 $ 14.70
============ ============
Market price per share, end of period $ 12.875 $ 15.00
============ ============
Total Based on market value per share (11.04%)+++ 0.92%+++
Investment ============ ============
Return:** Based on net asset value per share (12.65%)+++ 4.62%+++
============ ============
Ratios to Expenses, net of reimbursement .46%* .90%*
Average Net ============ ============
Assets:*** Expenses .85%* .90%*
============ ============
Investment income--net 5.14%* 5.27%*
============ ============
<PAGE>
Supplemental Net assets, net of Preferred Shares, end of period (in thousands) $ 49,565 $ 57,869
Data: ============ ============
Preferred Shares outstanding, end of period (in thousands) $ 27,500 $ 27,500
============ ============
Portfolio turnover 41.92% 22.31%
============ ============
Dividends Investment income--net $ 688 $ 238
Per Share on
Preferred
Shares Out-
standing:
<FN>
++Commencement of Operations.
++++The Fund's Preferred Shares were issued on September 2, 1993.
*Annualized.
**Total investment returns based on market value, which can be significantly greater or lesser than the net asset
value, result in substantially different returns. Total investment returns exclude the effects of sales loads.
***Do not reflect the effect of dividends to Preferred Shareholders.
+++Aggregate total investment return.
See Notes to Financial Statements.
</TABLE>
NOTES TO FINANCIAL STATEMENTS
1. Significant Accounting Policies:
MuniVest Pennsylvania Insured Fund (the "Fund") is registered
under the Investment Company Act of 1940 as a non-diversified,
closed-end management investment company. The following is a
summary of significant accounting policies followed by the Fund.
The Fund's Common Shares are listed on the New York Stock
Exchange under the symbol MVP.
(a) Valuation of investments--Municipal bonds are traded primarily
in the over-the-counter market 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. Finan-
cial futures contracts, which are traded on exchanges, are valued
at their closing prices as of the close of such exchanges. Options,
which are traded on exchanges, are valued at their last sale price
as of the close of such exchanges or, lacking any sales, at the last
available bid price. Securities with remaining maturities of sixty
days or less are valued at amortized cost. Securities for which
market quotations are not readily available are valued at fair val-
ue as determined in good faith by or under the direction of the
Board of Trustees of the Fund.
<PAGE>
(b) Financial futures contracts--The Fund may purchase or sell in-
terest rate 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.
(c) Income taxes--It is the Fund's policy to comply with the re-
quirements 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 trans-
actions are recorded on the dates the transactions are entered in-
to (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) Deferred organization and offering expenses--Deferred organi-
zation expenses are amortized on a straight-line basis over a
five-year period beginning with the commencement of operations
of the Fund. Direct expenses relating to the public offering of
the Fund's Common and Preferred Shares were charged to capital at
the time of issuance of the shares.
(f) Non-income producing investments--Written and purchased
options are non-income producing investments.
(g) Dividends and distributions--Dividends from net investment
income are declared and paid monthly. Distributions of capital
gains are recorded on the ex-dividend dates.
<PAGE>
2. Investment Advisory Agreement and Transactions with
Affiliates:
The Fund has entered into an Investment Advisory Agreement with
Fund Asset Management, L.P. ("FAM"). Effective January 1, 1994,
the investment advisory business of FAM was reorganized from a
corporation to a limited partnership. Both prior to and after the
reorganization, ultimate control of FAM was vested with Merrill
Lynch & Co., Inc. ("ML & Co."). The general partner of FAM is
Princeton Services, Inc., an indirect wholly-owned subsidiary
of ML & Co. The limited partners are ML & Co. and Merrill Lynch
Investment Management, Inc. ("MLIM"), which is also an indirect
wholly-owned subsidiary of ML & Co.
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 0.50%
of the Fund's average weekly net assets. For the six months ended
April 30, 1994, FAM earned fees of $205,679, of which $161,021 was
voluntarily waived.
Accounting services are provided to the Fund by FAM at cost.
Certain officers and/or trustees of the Fund are officers and/or
directors of FAM, MLIM, Merrill Lynch, Pierce, Fenner & Smith Inc.
("MLPF&S"), and/or ML & Co.
3. Investments:
Purchases and sales of investments, excluding short-term secur-
ities, for the six months ended April 30, 1994 were $35,261,857
and $33,007,152, respectively.
Net realized and unrealized losses as of April 30, 1994 were
as follows:
Realized Unrealized
Losses Losses
Long-term investments $(1,706,069) $(4,676,958)
Short-term investments -- (262,442)
----------- -----------
Total $(1,706,069) $(4,939,400)
=========== ===========
As of April 30, 1994, net unrealized depreciation for Federal in-
come tax purposes aggregated $4,939,400, of which $109,450 related
to appreciated securities and $5,048,850 related to depreciated
securities. The aggregate cost of investments at April 30, 1994 for
Federal income tax purposes was $84,418,043.
<PAGE>
4. Capital Share Transactions:
At April 30, 1994, the Fund had one class of Common Stock, par value
$.10 per share, of which unlimited number of shares were authorized.
For the six months ended April 30, 1994, shares issued and outstand-
ing increased by 62,768 to 3,999,936 as a result of dividend reinvest-
ment. At April 30, 1994, total paid-in capital amounted to $55,904,189.
Preferred Shares
Auction Market Preferred Shares ("AMPS") are Preferred Shares of the
Fund 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 April 30, 1994 was 2.90%.
In connection with the offering of AMPS, the Fund reclassified 550
shares of unissued capital stock as AMPS. For the six months ended
April 30, 1994, there were 550 AMPS authorized, issued and outstand-
ing with a liquidation preference of $50,000 per share, plus an un-
paid dividend of $20,273.
The Fund pays commissions to certain broker-dealers at the end of
each auction at the annual rate of one-quarter of 1% calculated
on the proceeds of each auction.
5. Subsequent Event:
On May 6, 1994, the Fund's Board of Trustees declared an ordinary
income dividend to Common Shareholders in the amount of $0.069227
per share, payable on May 27, 1994 to shareholders of record as of
May 17, 1994.
PER SHARE INFORMATION
<TABLE>
Per Share Selected
Quarterly Financial
Data*
<CAPTION>
Net Realized Unrealized Dividends/Distributions
Investment Gains Gains Net Investment Income Capital Gains
For the Period Income (Losses) (Losses) Common Preferred Common Preferred
<S> <C> <C> <C> <C> <C> <C> <C>
July 30, 1993++ to October 31, 1993 $.25 $ .07 $ .57 $.13 $.03 -- --
November 1, 1993 to January 31, 1994 .29 .03 .13 .22 .05 $.06 $.01
February 1, 1994 to April 30, 1994 .24 (.46) (1.93) .22 .05 -- --
<CAPTION>
Net Asset Value Market Price**
For the Period High Low High Low Volume***
<S> <C> <C> <C> <C> <C>
July 30, 1993++ to October 31, 1993 $15.04 $14.16 $15.375 $14.75 177
November 1, 1993 to January 31, 1994 14.80 14.06 15.50 14.375 175
February 1, 1994 to April 30, 1994 14.74 11.71 15.375 12.625 256
<FN>
++Commencement of Operations.
*Calculations are based upon Common Shares outstanding at the end of the period.
**As reported in the consolidated transaction reporting system.
***In thousands.
</TABLE>
