MUNIVEST
PENNSYLVANIA
INSURED
FUND
FUND LOGO
Semi-Annual Report
April 30, 1996
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 report. 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 Preferred
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 Common Shares, and the risk that fluctuations in
the short-term dividend rates of the Preferred Shares
may affect the yield to Common Shareholders. Statements
and other information herein are as dated and are
subject to change.
<PAGE>
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 Common
Shares. However, in order to benefit Common Shareholders, the
yield curve must be positively sloped; that is, short-term interest
rates must be lower than long-term interest rates. At the same time,
a period of generally declining interest rates will benefit Common
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
capitalization of $100 million and the issuance of Preferred Shares
for an additional $50 million, creating a total value of $150 million
available for investment in long-term municipal bonds. If prevail-
ing 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. Of course, increases
in short-term interest rates would reduce (and even eliminate)
the dividends on the Common Shares.
In this case, the dividends paid to Preferred Shareholders are
significantly lower than the income earned on the fund's long-
term investments, and therefore the Common Shareholders are
the beneficiaries of the incremental yield. However, if short-term
interest rates rise, narrowing the differential between short-
term and long-term interest rates, the incremental yield pick-up
on the Common Shares will be reduced or eliminated completely.
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
James H. Bodurtha, Trustee
Herbert I. London, Trustee
Robert R. Martin, Trustee
Joseph L. May, Trustee
Andre F. Perold, Trustee
Terry K. Glenn, Executive Vice President
Vincent R. Giordano, Senior Vice President
Donald C. Burke, Vice President
Kenneth A. Jacob, Vice President
Gerald M. Richard, Treasurer
Mark B. Goldfus, Secretary
Custodian
The Bank of New York
90 Washington Street
New York, New York 10286
NYSE Symbol
MVP
Transfer Agents
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
<PAGE>
DEAR SHAREHOLDER
For the six-month period ended April
30, 1996, the Common Shares of
MuniVest Pennsylvania Insured Fund
earned $0.365 per share income divi-
dends, which included earned and
unpaid dividends of $0.059. This rep-
resents a net annualized yield of
5.91%, based on a month-end per
share net asset value of $12.38. Over
the same period, the total investment
return on the Fund's Common Shares
was -1.17%, based on a change in
per share net asset value from $12.91
to $12.38, and assuming reinvestment
of $0.369 per share income dividends.
For the six-month period ended April
30, 1996, the Fund's Auction Market
Preferred Shares had an average yield
of 3.66%.
The Municipal Market
During the six months ended April
30, 1996, tax-exempt bond yields rose
as investors became increasingly con-
cerned that recent economic growth
would reignite inflationary pressures.
Through early February 1996, munici-
pal bond yields continued their ear-
lier declines supported by continued
moderate economic growth and favor-
able inflationary expectations. As
measured by the Bond Buyer Revenue
Bond Index, yields on uninsured,
A-rated municipal revenue bonds
declined an additional 30 basis points
(0.30%) to 5.70% by early February. As
signs of emerging economic growth
became more numerous, particularly
with the release of the strong March
employment figures, inflation fears
increased and bond yields rose in
response for the remainder of the
six-month period ended April 30, 1996.
At April 30, 1996, long-term municipal
bond yields were approximately 6.30%,
an increase of approximately 30 basis
points over the last six months. The
rise in US Treasury bond yields was
more substantial. Over the last six
months, yields on US Treasury securi-
ties rose approximately 60 basis points
to 6.90%. During the April period, the
municipal bond market reversed the
trend seen throughout much of 1995
and significantly outperformed the
US Treasury bond market.
<PAGE>
The municipal bond market's recent
outperformance was largely the result
of two principal factors. First, and
perhaps more important, much of the
earlier concern regarding proposed
changes in Federal income tax codes
and their effect on the tax treatment
of tax-exempt bond income has dissi-
pated. As the negative revenue impact
of the various proposals, such as the
flat tax, became apparent, the likeli-
hood of immediate reform quickly
diminished. When the Kemp Commis-
sion dealing with Federal income tax
reform released its findings early in
1996, the obvious need for reform was
highlighted. However, no specific rec-
ommendations of a flat tax, value-
added tax or any other reform were
made. Consequently, fears of losing
the favored tax treatment of munici-
pal bond income declined even fur-
ther. As a percentage of Treasury bond
yields, tax-exempt bond yield ratios
quickly declined from 95% to approxi-
mately 90%. This allowed the munici-
pal bond market to maintain much of
the gains made since early 1995.
The second major factor leading to
the municipal bond market's recent
improvement was the return of a more
favorable technical environment. Over
the past six months, approximately
$90 billion in municipal securities
were underwritten, an increase of
approximately 45% versus the com-
parable period a year earlier. However,
much of this increase was biased
by recent underwritings dedicated
toward refinancing. Like individual
homeowners, municipal issuers
sought to refinance their existing
higher-couponed debt as tax-exempt
bond yields declined from their highs
in 1995. In recent months such refi-
nancings were estimated to represent
at least 50% of total issuance. How-
ever, the recent rise in tax-exempt
interest rates slowed the pace of such
refinancings. Over the last three
months approximately $40 billion in
long-term tax-exempt securities were
underwritten, an increase of 35% com-
pared to the same period a year ago.
At current interest rate levels large
amounts of refundings are unlikely
and the rate of new bond issuance
should continue to decline.
<PAGE>
Additionally, investors continue to
receive significant amounts of assets
derived from coupon income, bond
maturities, and proceeds from early
redemptions. In recent months inves-
tors received over $30 billion in such
assets. These cash flows helped main-
tain individual retail investor demand
in recent months. Additionally, major
institutional investors, such as certain
insurance companies whose under-
writing profits were cyclically high,
demonstrated significant ongoing
interest in the tax-exempt bond
market, particularly on higher-quality
securities. Individual and institutional
investor demand was strong enough
during the six-month period ended
April 30, 1996 to absorb the relative
increase in bond issuance.
Looking ahead, we believe the munic-
ipal bond market is likely to continue
to outperform the US Treasury market.
Investor demand should remain ade-
quate to absorb new bond issuance. It
is also unlikely that the rapid pace of
issuance seen thus far in 1996 will be
maintained. The recent rise in yields
made further bond refinancings eco-
nomically unfeasible. Since these
refinancings were the driving force of
recent bond issuance, as the amount
of these refundings decline, overall
issuance should decline. This should
allow the current demand/supply
balance to be easily maintained in
upcoming months.
<PAGE>
Additionally, as a percentage of
US Treasury bond yields, long-term
municipal bond yields remain histori-
cally attractive. It is likely that recent
interest rate increases will have a neg-
ative impact on economic growth, per-
haps as early as late summer 1996.
With long-term mortgage rates above
8%, the domestic housing sector has
already indicated signs of slower
growth. If other interest rate sectors
of the economy, such as the automo-
bile industry, begin to show similar
adverse effects, taxable interest rates
would be poised to resume their de-
cline. With long-term tax-exempt reve-
nue bonds yielding approximately 90%
of their taxable counterparts, munici-
pal bond yields are poised to decline
further.
Portfolio Strategy
We entered the six-month period
ended April 30, 1996 optimistic that
interest rates would decline. This
optimism was based on the belief that
the economy was slowing and that
advances on a balanced Federal
budget agreement would be beneficial
to the fixed-income markets. To take
advantage of this anticipated decline
in interest rates, we reduced the
Fund's cash reserve position to a low
level and increased the Fund's dura-
tion. This strategy benefited the
Fund's performance as long-term inter-
est rates declined over 50 basis points
through the end of December. Through
mid-January, the economy appeared
sluggish enough that the Federal
Reserve Board lowered the Federal
Funds rate by 0.50% to 5.25% and the
markets priced in further easings of
monetary policy.
<PAGE>
The new year brought the beginning
of a reversal in the trend of lower
interest rates. By late February signs
of a strengthening economy began to
undermine the confidence in the
fixed-income market. In March a
strong employment report seemed to
confirm a surge in the growth of the
US economy, and yields rose rapidly.
Prior to the back up in yields, we
gradually increased the Fund's cash
reserves while shortening its duration.
This strategy made the Fund less sen-
sitive to the back up in yields experi-
enced in the fixed-income markets.
Looking ahead we remain cautious on
long-term interest rates. We believe
this stance is warranted as economic
releases so far in 1996 continue to
show strength while inflationary pres-
sures appeared in the form of higher
commodity prices. However, with the
swift increase in yields this year, we
recently decreased the Fund's cash
reserve position by purchasing long-
term securities at attractive yields. We
will maintain a cautious approach to
the municipal bond market until a
clearer direction of interest rates
emerges during the balance of the year.
In Conclusion
We appreciate your interest in
MuniVest Pennsylvania Insured Fund,
and we look forward to serving your
investment needs and objectives in
the months and years to come.
Sincerely,
(Arthur Zeikel)
Arthur Zeikel
President
(Vincent R. Giordano)
Vincent R. Giordano
Senior Vice President
<PAGE>
(William M. Petty)
William M. Petty
Portfolio Manager
June 3, 1996
We are pleased to announce that
William M. Petty is responsible for the
day-to-day management of MuniVest
Pennsylvania Insured Fund. Mr. Petty
has been employed by Merrill Lynch
Asset Management, L.P. (an affiliate of
the Fund's investment adviser) since
1993 as Vice President and was an
Assistant Vice President from 1992 to
1993. Prior thereto, he was employed
by J.J. Kenny Municipal Bond Brokers
as a Municipal Bond Broker from 1990
to 1992.
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 below and at right.
AMT Alternative Minimum Tax (subject to)
GO Government Obligation Bonds
IDA Industrial Development Authority
IDR Industrial Development Revenue Bonds
PCR Pollution Control Revenue Bonds
UPDATES Unit Priced Demand Adjustable
Tax-Exempt Securities
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
STATE Ratings Ratings Amount Issue (Note 1a)
<S> <S> <S> <C> <S> <C>
Pennsylvania-- AAA Aaa $2,240 Abington, Pennsylvania, School District, UT, Series AA, 5.75%
100.8% due 5/15/2024 (c) $ 2,191
Allegheny County, Pennsylvania, Hospital Development Authority Revenue
Bonds, VRDN (a):
A1 VMIG1++ 3,500 (Presbyterian Health Center), Series A, 4.10% due 3/01/2020 (b) 3,500
A1 VMIG1++ 100 (Presbyterian Health Center), Series C, 4.10% due 3/01/2018 (b) 100
NR* VMIG1++ 100 (Presbyterian University Hospital), Series B-1, 4.10% due 3/01/2020 100
NR* A1 200 Allegheny County, Pennsylvania, IDA, Revenue Refunding Bonds
(Commercial Development Parkway Center Mall Project), VRDN,
Series A, 4.30% due 5/01/2009 (a) 200
AAA Aaa 1,600 Altoona, Pennsylvania, City Authority, Water Revenue Bonds, Series A,
6.50% due 11/01/2019 (c) 1,682
AAA Aaa 2,550 Blair County, Pennsylvania, Hospital Authority Revenue Bonds
(Altoona Hospital Project), 6.375% due 7/01/2013 (d) 2,644
AAA Aaa 1,000 Bucks County, Pennsylvania, IDA, Revenue Refunding Bonds (Grand View
Hospital), Series A, 5.25% due 7/01/2021 (d) 900
AAA Aaa 1,590 Bucks County, Pennsylvania, Water and Sewer Authority, Sewer System
Revenue Bonds, 6.75% due 12/01/2019 (c) 1,707
BBB+ Baa1 1,700 Delaware County, Pennsylvania, Hospital Authority Revenue Bonds
(Crozer--Chester), 6% due 12/15/2020 1,547
Delaware County, Pennsylvania, IDA, PCR:
A1+ P1 500 (BP Oil Inc. Project), UPDATES, 4.20% due 12/01/2009 (a) 500
AAA Aaa 2,000 (Philadelphia Electric Company Project), Series A, 7.375% due
4/01/2021 (d) 2,223
A1+ NR* 2,000 Geisinger, Pennsylvania Health Systems Authority Revenue Bonds, VRDN,
Series B, 4.10% due 7/01/2022 (a) 2,000
AAA Aaa 2,750 Hampton Township, Pennsylvania, School District, UT, 6.75% due
11/15/2004 (d) (g) 3,089
AAA Aaa 2,700 Haverford Township, Pennsylvania, School District Refunding Bonds, UT,
5.30% due 3/15/2019 (c) 2,499
<PAGE>
AAA Aaa 3,280 Johnstown, Pennsylvania, Refunding Bonds, UT, 6.45% due 10/01/2019 (c) 3,411
A A 1,730 Lehigh County, Pennsylvania, General Purpose Authority Revenue Bonds
(Muhlenberg Hospital Center), Series B, 5.75% due 7/15/2010 1,659
AAA Aaa 2,000 Lehigh County, Pennsylvania, IDA, PCR, Refunding (Pennsylvania Power &
Light Company Project), Series A, 6.40% due 11/01/2021 (b) 2,080
AAA Aaa 3,000 Luzerne County, Pennsylvania, IDA, Exempt Facilities Revenue Refunding
Bonds (Pennsylvania Gas & Water Company Project), AMT, Series A, 7% due
12/01/2017 (d) 3,264
AAA NR* 1,200 Montgomery County, Pennsylvania, Higher Education and Health Authority,
Revenue Refunding Bonds (Saint Joseph's University), 6.50% due
12/15/2022 (h) 1,237
AAA Aaa 3,000 North Penn, Pennsylvania, Water Authority Revenue Bonds, 7% due
11/01/2004 (c) (g) 3,436
AAA Aaa 1,000 Northeastern, Pennsylvania, Hospital and Educational Authority,
Guaranteed College Revenue Bonds (Luzerne County Community College),
6.625% due 8/15/2015 (d) 1,060
BBB NR* 2,500 Northeastern, Pennsylvania, Hospital and Educational Authority,
University Revenue Refunding Bonds (Wilkes University), 5.625%
due 10/01/2018 2,204
BBB+ Baa1 2,500 Pennsylvania Economic Development Financing Authority, Wastewater
Treatment Revenue Bonds (Sun Company Inc.--R & M Project), AMT,
Series A, 7.60% due 12/01/2024 2,737
AAA Aaa 4,000 Pennsylvania Intergovernmental Cooperative Authority, Special Tax
Revenue Bonds (City of Philadelphia Funding Program), 5.625% due
6/15/2023 (b) 3,780
AAA Aaa 4,000 Pennsylvania State Higher Education Assistance Agency, Student Loan
Revenue Bonds, AMT, Series C, 7.15% due 9/01/2021 (d) 4,149
NR* VMIG1++ 1,200 Pennsylvania State Higher Educational Facilities Authority, College
and University Revenue Bonds (Temple University), VRDN, 4.10% due
10/01/2009 (a) 1,200
AAA Aaa 3,000 Pennsylvania State Higher Educational Facilities Authority Revenue
Bonds (State System of Higher Education), Series N, 5.80% due
6/15/2024 (b) 2,959
A1+ NR* 400 Philadelphia, Pennsylvania, Authority for IDR (Institute for Cancer
Research Project), VRDN, Series A, 4.10% due 7/01/2013 (a) 400
<PAGE>
Philadelphia, Pennsylvania, Water and Wastewater Revenue Bonds (b):
AAA Aaa 2,500 5.60% due 8/01/2018 2,396
AAA Aaa 2,000 Refunding, 5% due 6/15/2019 1,767
AAA Aaa 5,000 Pittsburgh, Pennsylvania, Water and Sewer Authority, Water and Sewer
System Revenue Bonds, First Lien, Series A, 5.60% due 9/01/2022 (c) 4,755
AAA Aaa 3,000 Seneca Valley, Pennsylvania, School District, UT, 5.85% due
2/15/2020 (c) 2,943
AAA Aaa 2,000 Solanco, Pennsylvania, School District, UT, 6.30% due 2/15/2014 (c) 2,060
AAA Aaa 3,000 Somerset County, Pennsylvania, General Authority, Commonwealth Lease
Revenue Bonds, 6.25% due 10/15/2001 (c) (g) 3,222
AAA Aaa 1,500 Southeastern, Pennsylvania, Transportation Authority, Pennsylvania
Special Revenue Bonds, Series A, 5.75% due 3/01/2020 (c) 1,462
AAA Aaa 1,010 Wattsburg Area School District, Pennsylvania, Refunding, UT,
Series A, 5.10% due 4/01/2013 (b) 942
Puerto Rico--1.9% AAA Aaa 1,500 Commonwealth of Puerto Rico, GO, YCN, 7.982% due 7/01/2020 (e) (f) 1,434
Total Investments (Cost--$77,903)--102.7% 79,439
Liabilities in Excess of Other Assets--(2.7%) (2,120)
-------
Net Assets--100.0% $77,319
=======
<FN>
(a)The interest rate is subject to change periodically
based upon prevailing market rates. The interest rate
shown is the rate in effect at April 30, 1996.
(b)MBIA Insured.
(c)FGIC Insured.
(d)AMBAC Insured.
(e)FSA Insured.
(f)The interest rate is subject to change periodically and
inversely based upon prevailing market rates. The interest
rate shown is the rate in effect at April 30, 1996.
(g)Prerefunded.
(h)Connie Lee Insured.
*Not Rated.
++Highest short-term rating by Moody's Investors Service, Inc.
See Notes to Financial Statements.
</TABLE>
<PAGE>
<TABLE>
STATEMENT OF ASSETS, LIABILITIES AND CAPITAL
<CAPTION>
As of April 30, 1996
<S> <S> <C> <C>
Assets: Investments, at value (identified cost--$77,903,097)(Note 1a) $79,438,876
Cash 59,882
Interest receivable 1,227,364
Deferred organization expense (Note 1e) 35,133
Prepaid registration fees and other assets 2,485
-----------
Total assets 80,763,740
-----------
Liabilities: Payables:
Securities purchased $3,229,414
Dividends to shareholders (Note 1f) 96,971
Investment adviser (Note 2) 31,855 3,358,240
----------
Accrued expenses and other liabilities 86,305
Total liabilities 3,444,545
-----------
Net Assets: Net assets $77,319,195
===========
Capital: Capital Shares (unlimited number of shares authorized)(Note 4):
Preferred Shares, par value $.10 per share (1,100 shares of AMPS*
issued and outstanding at $25,000 per share liquidation preference) $27,500,000
Common Shares, par value $.10 per share (4,024,856 shares issued and
outstanding) $ 402,486
Paid-in capital in excess of par 55,795,641
Undistributed investment income--net 259,285
Accumulated realized capital losses on investments--net (Note 5) (8,173,996)
Unrealized appreciation on investments--net 1,535,779
-----------
Total--Equivalent to $12.38 net asset value per Common Share (market
price--$12.125) 49,819,195
-----------
Total capital $77,319,195
===========
<FN>
*Auction Market Preferred Shares.
See Notes to Financial Statements.
</TABLE>
<PAGE>
<TABLE>
STATEMENT OF OPERATIONS
<CAPTION>
For the Six Months Ended April 30, 1996
<S> <S> <C> <C>
Investment Interest and amortization of premium and discount earned $ 2,326,910
Income
(Note 1d):
Expenses: Investment advisory fees (Note 2) $198,255
Commission fees (Note 4) 35,123
Professional fees 34,073
Accounting services (Note 2) 24,276
Printing and shareholder reports 19,854
Transfer agent fees 16,721
Listing fees 7,985
Trustees' fees and expenses 7,431
Amortization of organization expenses (Note 1e) 6,337
Custodian fees 3,984
Pricing fees 3,115
--------
Total expenses 357,154
-----------
Investment income--net 1,969,756
-----------
Realized & Realized loss on investments--net (23,849)
Unrealized Change in unrealized appreciation on investments--net (2,082,421)
Loss on -----------
Investments Net Decrease in Net Assets Resulting from Operations $ (136,514)
- --Net (Notes ===========
1b, 1d & 3):
See Notes to Financial Statements.
</TABLE>
<PAGE>
<TABLE>
STATEMENTS OF CHANGES IN NET ASSETS
<CAPTION>
For the Six For the
Months Ended Year Ended
April 30, October 31,
Increase (Decrease) in Net Assets: 1996 1995
<S> <S> <C> <C>
Operations: Investment income--net $ 1,969,756 $ 4,074,200
Realized loss on investments--net (23,849) (3,458,573)
Change in unrealized appreciation/depreciation on investments--net (2,082,421) 8,950,224
----------- -----------
Net increase (decrease) in net assets resulting from operations (136,514) 9,565,851
----------- -----------
Dividends to Investment income--net:
Shareholders Common Shares (1,481,790) (3,026,364)
(Note 1f): Preferred Shares (501,985) (1,062,765)
----------- -----------
Net decrease in net assets resulting from dividends to shareholders (1,983,775) (4,089,129)
----------- -----------
Capital Value of shares issued to Common Shareholders in reinvestment of dividends 72,729 --
Share ----------- -----------
Transactions Net increase in net assets derived from capital share transactions 72,729 --
(Note 4): ----------- -----------
Net Assets: Total increase (decrease) in net assets (2,047,560) 5,476,722
Beginning of period 79,366,755 73,890,033
----------- -----------
End of period* $77,319,195 $79,366,755
=========== ===========
<FN>
*Undistributed investment income--net $ 259,285 $ 273,304
=========== ===========
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 For the Six For the Period
financial statements. Months Ended July 30, 1993++
April 30, For the Year Ended October 31, to October 31,
Increase (Decrease) in Net Asset Value: 1996 1995 1994 1993
<S> <S> <C> <C> <C> <C>
Per Share Net asset value, beginning of period $ 12.91 $ 11.54 $ 14.70 $ 14.18
Operating --------- --------- --------- ---------
Performance: Investment income--net .48 1.01 1.05 .25
Realized and unrealized gain (loss) on investments--net (.52) 1.37 (3.08) .64
--------- --------- --------- ---------
Total from investment operations (.04) 2.38 (2.03) .89
--------- --------- --------- ---------
Less dividends and distributions to Common Shareholders:
Investment income--net (.37) (.75) (.86) (.13)
Realized gain on investments--net -- -- (.06) --
--------- --------- --------- ---------
Total dividends and distributions to Common Shareholders (.37) (.75) (.92) (.13)
--------- --------- --------- ---------
Capital charge resulting from issuance of Common Shares -- -- -- (.05)
--------- --------- --------- ---------
Effect of Preferred Share activity:++++
Dividends and distributions to Preferred Shareholders:
Investment income--net (.12) (.26) (.20) (.03)
Realized gain on investments--net -- -- (.01) --
Capital charge resulting from issuance of
Preferred Shares -- -- -- (.16)
--------- --------- --------- ---------
Total effect of Preferred Share activity (.12) (.26) (.21) (.19)
--------- --------- --------- ---------
Net asset value, end of period $ 12.38 $ 12.91 $ 11.54 $ 14.70
========= ========= ========= =========
Market price per share, end of period $ 12.125 $ 11.875 $ 10.875 $ 15.00
========= ========= ========= =========
Total Based on market price per share 5.23%+++ 16.58% (22.20%) .92%+++
Investment ========= ========= ========= =========
Return:** Based on net asset value per share (1.17%)+++ 19.44% (15.76%) 4.62%+++
========= ========= ========= =========
Ratios to Expenses, net of reimbursement .90%* .83% .51% .90%*
Average ========= ========= ========= =========
Net Expenses .90%* .95% .86% .90%*
Assets:*** ========= ========= ========= =========
Investment income--net 4.95%* 5.33% 5.24% 5.27%*
========= ========= ========= =========
Supplemental Net assets, net of Preferred Shares, end of period
Data: (in thousands) $ 49,819 $ 51,867 $ 46,390 $ 57,869
========= ========= ========= =========
Preferred Shares outstanding, end of period (in
thousands) $ 27,500 $ 27,500 $ 27,500 $ 27,500
========= ========= ========= =========
Portfolio turnover 69.06% 73.19% 93.00% 22.31%
========= ========= ========= =========
Leverage: Asset coverage per $1,000 $ 2,812 $ 2,886 $ 2,687 $ 3,104
========= ========= ========= =========
Dividends Investment income--net $ 456 $ 966 $ 721 $ 119
Per Share on ========= ========= ========= =========
Preferred
Shares
Outstanding:++++++
<PAGE>
<FN>
*Annualized.
**Total investment returns based on market value, which
can be significantly greater or lesser than the net asset
value, may result in substantially different returns. Total
investment returns exclude the effects of sales loads.
***Do not reflect the effect of dividends to Preferred Shareholders.
++Commencement of Operations.
++++The Fund's Preferred Shares were issued on September 2, 1993.
++++++Dividends per share have been adjusted to reflect a two-for-one
stock split that occurred on December 1, 1994.
++++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. These unaudited
financial statements reflect all adjustments which are, in the opinion
of management, necessary to a fair statement of the results for the
interim period presented. All such adjustments are of a normal
recurring nature. The Fund determines and makes available for
publication the net asset value of its Common Shares on a weekly
basis. The Fund's Common Shares are listed on the New York Stock
Exchange under the symbol MVP. The following is a summary of
significant accounting policies followed by the Fund.
(a) Valuation of investments--Municipal bonds are traded primarily
in the over-the-counter markets and are valued at the most recent bid
price or yield equivalent as obtained by the Fund's pricing service
from dealers that make markets in such securities. Financial futures
contracts and options thereon, which are traded on exchanges, are
valued at their closing prices as of the close of such exchanges.
Options, 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, which approximates market
value. Securities for which market quotations are not readily avail-
able are valued at fair value as determined in good faith by or under
the direction of the Board of Trustees of the Fund, including valua-
tions furnished by a pricing service retained by the Fund, which
may utilize a matrix system for valuations. The procedures of the
pricing service and its valuations are reviewed by the officers of the
Fund under the general supervision of the Board of Trustees.
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(b) Derivative financial instruments--The Fund may engage in vari-
ous portfolio strategies to seek to increase its return by hedging its
portfolio against adverse movements in the debt markets. Losses may
arise due to changes in the value of the contract or if the counterparty
does not perform under the contract.
* Financial futures contracts--The Fund may purchase or sell inter-
est 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 con-
tract is closed, the Fund records a realized gain or loss equal to the
difference between the value of the contract at the time it was
opened and the value at the time it was closed.
* Options--The Fund is authorized to write covered call options and
purchase put options. When the Fund writes an option, an amount
equal to the premium received by the Fund is reflected as an asset
and an equivalent liability. The amount of the liability is subsequently
marked to market to reflect the current market value of the option
written. When a security is purchased or sold through an exercise
of an option, the related premium paid (or received) is added to
(or deducted from) the basis of the security acquired, or deducted
from (or added to) the proceeds of the security sold. When an option
expires (or the Fund enters into a closing transaction), the Fund
realizes a gain or loss on the option to the extent of the premiums
received or paid (or gain or loss to the extent the cost of the closing
transaction exceeds the premium paid or received).
Written and purchased options are non-income producing investments.
(c) Income taxes--It is the Fund's policy to comply with the require-
ments of the Internal Revenue Code applicable to regulated invest-
ment companies and to distribute substantially all of its taxable
income to its shareholders. Therefore, no Federal income tax provi-
sion is required.
(d) Security transactions and investment income--Security trans-
actions are recorded on the dates the transactions are entered into
(the trade dates). Interest income is recognized on the accrual basis.
Discounts and market premiums are amortized into interest income.
Realized gains and losses on security transactions are determined
on the identified cost basis.
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(e) Deferred organization expenses--Deferred organization expenses
are amortized on a straight-line basis over a five-year period.
(f) Dividends and distributions--Dividends from net investment
income are declared and paid monthly. Distributions of capital gains
are recorded on the ex-dividend dates.
2. Investment Advisory Agreement and Transactions
with Affiliates:
The Fund has entered into an Investment Advisory Agreement
with Fund Asset Management, L.P. ("FAM"). The general partner of
FAM is Princeton Services, Inc. ("PSI"), an indirect wholly-owned
subsidiary of Merrill Lynch & Co., Inc. ("ML & Co."), which is the
limited partner.
FAM is responsible for the management of the Fund's portfolio and
provides the necessary personnel, facilities, equipment and certain
other services necessary to the operations of the Fund. For such
services, the Fund pays a monthly fee at an annual rate of 0.50% of
the Fund's average weekly net assets.
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, PSI, Merrill Lynch, Pierce, Fenner & Smith Inc.
("MLPF&S"), and/or ML & Co.
3. Investments:
Purchases and sales of investments, excluding short-term securities,
for the six months ended April 30, 1996 were $52,906,147 and
$54,353,751, respectively.
Net realized and unrealized gains (losses) as of April 30, 1996 were
as follows:
Realized
Gains Unrealized
(Losses) Gains
Long-term investments $(175,599) $1,535,779
Financial futures contracts 151,750 --
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Total $ (23,849) $1,535,779
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As of April 30, 1996, net unrealized appreciation for Federal income
tax purposes aggregated $1,535,779, of which $2,560,165 related to
appreciated securities and $1,024,386 related to depreciated securities.
The aggregate cost of investments at April 30, 1996 for Federal income
tax purposes was $77,903,097.
4. Capital Share Transactions:
The Fund is authorized to issue an unlimited number of shares of
beneficial interest, including Preferred Shares, par value $.10 per
share, all of which were initially classified as Common Shares. The
Board of Trustees is authorized, however, to reclassify any unissued
shares of capital without approval of the holders of Common Shares.
Common Shares
For the six months ended April 30, 1996, shares issued and out-
standing increased by 5,823 to 4,024,856 as a result of dividend
reinvestment. At April 30, 1996, total paid-in capital amounted to
$56,198,127.
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, 1996 was 3.825%.
As of April 30, 1996, there were 1,100 AMPS authorized, issued and
outstanding with a liquidation preference of $25,000 per share.
The Fund pays commissions to certain broker-dealers at the end of
each auction at an annual rate ranging from 0.25% to 0.375%,
calculated on the proceeds of each auction. For the six months ended
April 30, 1996, MLPF&S, an affiliate of FAM, earned $25,110
as commissions.
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5. Capital Loss Carryforward:
At October 31, 1995, the Fund had a net capital loss carryforward of
approximately $7,591,000, of which $4,474,000 expires in 2002, and
$3,117,000 expires in 2003. This amount will be available to offset
like amounts of any future taxable gains.
6. Subsequent Event:
On May 10, 1996, the Fund's Board of Trustees declared an ordinary
income dividend to Common Shareholders in the amount of $0.058949
per share, payable on May 30, 1996 to shareholders of record as of
May 21, 1996.
