-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Oz8wRYWDFTXSyqe7b+7+PYK+ceuEPTQHEvCyunv4nXJF3QL/5WmMDisXSbCYHm58 WBlkCLyPKusHRKXAlw146g== 0000930413-03-001387.txt : 20030508 0000930413-03-001387.hdr.sgml : 20030508 20030429132916 ACCESSION NUMBER: 0000930413-03-001387 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20030228 FILED AS OF DATE: 20030429 EFFECTIVENESS DATE: 20030429 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BLACKROCK CALIFORNIA INSURED MUNICIPAL INCOME TRUST CENTRAL INDEX KEY: 0001181027 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-21177 FILM NUMBER: 03668818 BUSINESS ADDRESS: STREET 1: 40 EAST 52ND ST CITY: NEW YORK STATE: NY ZIP: 10022 BUSINESS PHONE: 2127545300 FORMER COMPANY: FORMER CONFORMED NAME: BLACKROCK CALIFORNIA MUNICIPAL INCOME TRUST III DATE OF NAME CHANGE: 20020816 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BLACKROCK MUNICIPAL INCOME TRUST II CENTRAL INDEX KEY: 0001176194 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-21126 FILM NUMBER: 03668819 BUSINESS ADDRESS: STREET 1: 40 EAST 52ND STREET CITY: NEW YORK STATE: NY ZIP: 10022 BUSINESS PHONE: 2127545300 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BLACKROCK CALIFORNIA MUNICIPAL INCOME TRUST II CENTRAL INDEX KEY: 0001176196 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-21125 FILM NUMBER: 03668816 BUSINESS ADDRESS: STREET 1: 40 EAST 52ND STREET CITY: NEW YORK STATE: NY ZIP: 10022 BUSINESS PHONE: 2127545300 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BLACKROCK NEW YORK MUNICIPAL INCOME TRUST II CENTRAL INDEX KEY: 0001176197 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-21124 FILM NUMBER: 03668812 BUSINESS ADDRESS: STREET 1: 40 EAST 52ND STREET CITY: NEW YORK STATE: NY ZIP: 10022 BUSINESS PHONE: 2127545300 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BLACKROCK NEW YORK INSURED MUNICIPAL INCOME TRUST CENTRAL INDEX KEY: 0001181024 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-21179 FILM NUMBER: 03668810 BUSINESS ADDRESS: STREET 1: 40 EAST 52ND ST CITY: NEW YORK STATE: NY ZIP: 10022 BUSINESS PHONE: 2127545300 FORMER COMPANY: FORMER CONFORMED NAME: BLACKROCK NEW YORK MUNICIPAL INCOME TRUST III DATE OF NAME CHANGE: 20020816 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BLACKROCK FLORIDA INSURED MUNICIPAL INCOME TRUST CENTRAL INDEX KEY: 0001181026 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-21180 FILM NUMBER: 03668815 BUSINESS ADDRESS: STREET 1: 40 EAST 52ND ST CITY: NEW YORK STATE: NY ZIP: 10022 BUSINESS PHONE: 2127545300 FORMER COMPANY: FORMER CONFORMED NAME: BLACKROCK FLORIDA MUNICIPAL INCOME TRUST III DATE OF NAME CHANGE: 20020816 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BLACKROCK INSURED MUNICIPAL INCOME TRUST CENTRAL INDEX KEY: 0001181187 IRS NUMBER: 816105962 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-21178 FILM NUMBER: 03668821 BUSINESS ADDRESS: STREET 1: 40 EAST 52ND STREET CITY: NEW YORK STATE: NY ZIP: 10022 BUSINESS PHONE: 2127545300 FORMER COMPANY: FORMER CONFORMED NAME: BLACKROCK MUNICIPAL INCOME TRUST III DATE OF NAME CHANGE: 20020819 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BLACKROCK MUNICIPAL BOND TRUST CENTRAL INDEX KEY: 0001167467 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-21036 FILM NUMBER: 03668820 BUSINESS ADDRESS: STREET 1: 345 PARK AVE CITY: NEW YORK STATE: NY ZIP: 10154 BUSINESS PHONE: 2127545300 MAIL ADDRESS: STREET 1: 345 PARK AVE CITY: NEW YORK STATE: NY ZIP: 10154 FORMER COMPANY: FORMER CONFORMED NAME: BLACKROCK TAX FREE INCOME TRUST DATE OF NAME CHANGE: 20020213 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BLACKROCK NEW YORK MUNICIPAL BOND TRUST CENTRAL INDEX KEY: 0001167470 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-21037 FILM NUMBER: 03668813 BUSINESS ADDRESS: STREET 1: 345 PARK AVE CITY: NEW YORK STATE: NY ZIP: 10154 BUSINESS PHONE: 2127545300 MAIL ADDRESS: STREET 1: 345 PARK AVE CITY: NEW YORK STATE: NY ZIP: 10154 FORMER COMPANY: FORMER CONFORMED NAME: BLACKROCK NEW YORK TAX FREE INCOME TRUST DATE OF NAME CHANGE: 20020213 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BLACKROCK CALIFORNIA MUNICIPAL BOND TRUST CENTRAL INDEX KEY: 0001169027 IRS NUMBER: 000000000 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-21052 FILM NUMBER: 03668817 BUSINESS ADDRESS: STREET 1: 345 PARK AVENUE CITY: NEW YORK STATE: NY ZIP: 10154 BUSINESS PHONE: 2127545300 MAIL ADDRESS: STREET 1: 345 PARK AVENUE CITY: NEW YORK STATE: NY ZIP: 10154 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BLACKROCK FLORIDA MUNICIPAL BOND TRUST CENTRAL INDEX KEY: 0001169028 IRS NUMBER: 000000000 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-21054 FILM NUMBER: 03668822 BUSINESS ADDRESS: STREET 1: 345 PARK AVENUE CITY: NEW YORK STATE: NY ZIP: 10154 BUSINESS PHONE: 2127545300 MAIL ADDRESS: STREET 1: 345 PARK AVENUE CITY: NEW YORK STATE: NY ZIP: 10154 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BLACKROCK MARYLAND MUNICIPAL BOND TRUST CENTRAL INDEX KEY: 0001169029 IRS NUMBER: 000000000 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-21051 FILM NUMBER: 03668811 BUSINESS ADDRESS: STREET 1: 345 PARK AVENUE CITY: NEW YORK STATE: NY ZIP: 10154 BUSINESS PHONE: 2127545300 MAIL ADDRESS: STREET 1: 345 PARK AVENUE CITY: NEW YORK STATE: NY ZIP: 10154 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BLACKROCK NEW JERSEY MUNICIPAL BOND TRUST CENTRAL INDEX KEY: 0001169031 IRS NUMBER: 000000000 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-21050 FILM NUMBER: 03668809 BUSINESS ADDRESS: STREET 1: 345 PARK AVENUE CITY: NEW YORK STATE: NY ZIP: 10154 BUSINESS PHONE: 2127545300 MAIL ADDRESS: STREET 1: 345 PARK AVENUE CITY: NEW YORK STATE: NY ZIP: 10154 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BLACKROCK VIRGINIA MUNICIPAL BOND TRUST CENTRAL INDEX KEY: 0001169034 IRS NUMBER: 000000000 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-21053 FILM NUMBER: 03668814 BUSINESS ADDRESS: STREET 1: 345 PARK AVENUE CITY: NEW YORK STATE: NY ZIP: 10154 BUSINESS PHONE: 2127545300 MAIL ADDRESS: STREET 1: 345 PARK AVENUE CITY: NEW YORK STATE: NY ZIP: 10154 N-CSR 1 c26967_ncsr.txt This report is for shareholder information. This is not a prospectus intended for use in the purchase or sale of Trust shares. Statements and other information contained in this report are as dated and are subject to change. WORLD CLASS INSTITUTIONAL ASSET MANAGEMENT AT A PERSONAL LEVEL NOT FDIC May Lose Value INSURED No Bank Guarantee BLACKROCK CLOSED-END FUNDS - ----------------------------------------- SEMI-ANNUAL REPORT - ----------------------------------------- February 28, 2003 (unaudited) BLACKROCK INSURED MUNICIPAL INCOME TRUST BLACKROCK MUNICIPAL BOND TRUST BLACKROCK MUNICIPAL INCOME TRUST II BLACKROCK CALIFORNIA INSURED MUNICIPAL INCOME TRUST BLACKROCK CALIFORNIA MUNICIPAL BOND TRUST BLACKROCK CALIFORNIA MUNICIPAL INCOME TRUST II BLACKROCK FLORIDA INSURED MUNICIPAL INCOME TRUST BLACKROCK FLORIDA MUNICIPAL BOND TRUST BLACKROCK MARYLAND MUNICIPAL BOND TRUST BLACKROCK NEW JERSEY MUNICIPAL BOND TRUST BLACKROCK NEW YORK INSURED MUNICIPAL INCOME TRUST BLACKROCK NEW YORK MUNICIPAL BOND TRUST BLACKROCK NEW YORK MUNICIPAL INCOME TRUST II BLACKROCK VIRGINIA MUNICIPAL BOND TRUST TABLE OF CONTENTS Letter to Shareholders .................................................... 1 Portfolio Managers' Report ................................................ 2 Trust Summaries ........................................................... 7 Portfolios of Investments ................................................. 21 Financial Statements Statements of Assets and Liabilities ................................... 41 Statements of Operations ............................................... 44 Statements of Changes in Net Assets .................................... 47 Financial Highlights ...................................................... 52 Notes to Financial Statements ............................................. 57 Dividend Reinvestment Plans ............................................... 62 Investment Summaries ...................................................... 63 Additional Information .................................................... 71 Glossary .................................................................. 71 - -------------------------------------------------------------------------------- PRIVACY PRINCIPLES OF THE TRUSTS The Trusts are committed to maintaining the privacy of shareholders and to safeguarding their non-public personal information. The following information is provided to help you understand what personal information the Trusts collect, how we protect that information and why, in certain cases, we may share information with select other parties. Generally, the Trusts do not receive any non-public personal information relating to their shareholders, although certain non-public personal information of shareholders may become available to the Trusts. The Trusts do not disclose any non-public personal information about their shareholders or former shareholders to anyone, except as permitted by law or as is necessary in order to service shareholder accounts (for example, to a transfer agent or third party administrator). The Trusts restrict access to non-public personal information about their shareholders to BlackRock employees with a legitimate business need for the information. The Trusts maintain physical, electronic and procedural safeguards designed to protect the non-public personal information of their shareholders. - -------------------------------------------------------------------------------- LETTER TO SHAREHOLDERS March 31, 2003 Dear Shareholder: We are pleased to report that during the period, the Trusts continued to provide tax-free monthly income, as well as the opportunity to invest in various diversified portfolios of municipal bond securities. The Trusts are actively managed, which means that the management team is continuously monitoring the municipal bond market and adjusting the portfolios to gain exposure to various issuers, revenue sources and security types. This strategy enables the Trusts to move among different sectors, credits and coupons to capitalize on changing market conditions. During the period, demand for municipal bonds remained positive. In the face of weaker equity markets, individual investors continue to favor the high credit quality and low volatility that municipal securities can offer. For the six months ended February 28, 2003, the LEHMAN BROTHERS MUNICIPAL BOND INDEX(1) had a total return of 3.36%. The following table shows the Trusts' yields, tax-equivalent yields (based on the maximum Federal tax rate of 38.6%), closing market prices per share and net asset values ("NAV") per share as of February 28, 2003.
TAX- EQUIVALENT MARKET TRUST YIELD(2) YIELD(2) PRICE NAV - ------------------------------------------------------------------------------------------------------- BlackRock Insured Municipal Income Trust (BYM) 6.69% 10.90% $14.01 $14.52 BlackRock Municipal Bond Trust (BBK) 7.23 11.78 14.00 14.80 BlackRock Municipal Income Trust II (BLE) 7.31 11.90 13.75 14.13 BlackRock California Insured Municipal Income Trust (BCK) 6.44 10.49 13.97 14.32 BlackRock California Municipal Bond Trust (BZA) 6.97 11.34 13.46 14.77 BlackRock California Municipal Income Trust II (BCL) 7.17 11.68 13.60 13.92 BlackRock Florida Insured Municipal Income Trust (BAF) 6.28 10.22 14.34 14.50 BlackRock Florida Municipal Bond Trust (BIE) 6.39 10.41 14.32 15.19 BlackRock Maryland Municipal Bond Trust (BZM) 5.77 9.40 14.55 15.03 BlackRock New Jersey Municipal Bond Trust (BLJ) 6.76 11.02 13.75 14.40 BlackRock New York Insured Municipal Income Trust (BSE) 6.24 10.17 14.42 14.45 BlackRock New York Municipal Bond Trust (BQH) 6.84 11.14 13.38 14.90 BlackRock New York Municipal Income Trust II (BFY) 7.03 11.44 13.45 14.30 BlackRock Virginia Municipal Bond Trust (BHV) 5.63 9.17 15.05 15.28
BlackRock, Inc. ("BlackRock"), a world leader in asset management, has a proven commitment to the municipal market. As of December 31, 2002, BlackRock managed approximately $14 billion in municipal bonds including six open-end and 35 closed-end municipal bond funds. At BlackRock, we are recognized for our emphasis on risk management and proprietary analytics and for our reputation managing money for the world's largest institutional investors. Individual investors in our closed-end and open-end funds benefit from the same investment management skills and resources as our institutional investors. BlackRock Advisors, Inc., which manages the Trusts, is a wholly owned subsidiary of BlackRock, Inc. This report contains a summary of market conditions for the period, a review of the strategy used by your Trusts' managers, the Trusts' unaudited financial statements and a listing of each of the portfolios' holdings. On behalf of BlackRock, we thank you for your continued trust and assure you that we remain committed to excellence in managing your assets. Sincerely, /s/ Laurence D. Fink /s/ Ralph L. Schlosstein Laurence D. Fink Ralph L. Schlosstein Chief Executive Officer President BlackRock Advisors, Inc. BlackRock Advisors, Inc. (1) The LEHMAN BROTHERS MUNICIPAL BOND INDEX is designed to measure the performance of the investment grade long-term tax-exempt bond market. The index is unmanaged and cannot be purchased directly. (2) Yields are based on market price. Tax-equivalent yield assumes the maximum Federal tax rate of 38.6%. 1 PORTFOLIO MANAGERS' REPORT March 31, 2003 Dear Shareholder: We are pleased to present the unaudited semi-annual report for the following BlackRock closed-end municipal Trusts: PRIMARY TRUST EXCHANGE - -------------------------------------------------------------------------------- BLACKROCK INSURED MUNICIPAL INCOME TRUST (BYM) NYSE BLACKROCK MUNICIPAL BOND TRUST (BBK) NYSE BLACKROCK MUNICIPAL INCOME TRUST II (BLE) AMEX BLACKROCK CALIFORNIA INSURED MUNICIPAL INCOME TRUST (BCK) NYSE BLACKROCK CALIFORNIA MUNICIPAL BOND TRUST (BZA) NYSE BLACKROCK CALIFORNIA MUNICIPAL INCOME TRUST II (BCL) AMEX BLACKROCK FLORIDA INSURED MUNICIPAL INCOME TRUST (BAF) NYSE BLACKROCK FLORIDA MUNICIPAL BOND TRUST (BIE) NYSE BLACKROCK MARYLAND MUNICIPAL BOND TRUST (BZM) AMEX BLACKROCK NEW JERSEY MUNICIPAL BOND TRUST (BLJ) AMEX BLACKROCK NEW YORK INSURED MUNICIPAL INCOME TRUST (BSE) NYSE BLACKROCK NEW YORK MUNICIPAL BOND TRUST (BQH) NYSE BLACKROCK NEW YORK MUNICIPAL INCOME TRUST II (BFY) AMEX BLACKROCK VIRGINIA MUNICIPAL BOND TRUST (BHV) AMEX The semi-annual report reviews the Trusts' market price and NAV performance, summarizes developments in the relevant fixed income markets and discusses recent portfolio management activity for the period ended February 28, 2003. THE FIXED INCOME MARKETS AND ECONOMIC COMMENTARY Fixed income markets displayed considerable vigor throughout much of 2002 and exhibited similar performance through the first two months of 2003. For the six-month period ended February 28, 2003, the LEHMAN BROTHERS U.S. AGGREGATE INDEX, a broad measure of the fixed income market, returned 4.74%. Over the same period, the equity markets, as measured by the S&P 500 INDEX, returned -7.29%. Over the semi-annual period, there has been no reprieve from the primary themes that have been prevalent in the marketplace in recent years. Uncertainty and volatility continue to affect virtually all markets and key indicators appear reluctant to provide considerable insight as to the condition and direction of the economic recovery. Growth in the manufacturing sector and a revised fourth quarter GDP that was greater than expected bode well for an improving economy. However, several significant factors continue to drag on potential economic growth. In January, new home sales experienced the steepest decline since 1994, initial jobless claims were above expectations and consumer confidence hit a nine-year low. After beginning the semi-annual period with a reading of 5.7% in September, the unemployment rate reached a high in December of 6.0% before settling in February at 5.8%, near where it began the period. Despite the slight reduction in the unemployment rate since December 2002, the most recent reading was largely seen as a negative, with February experiencing the steepest decline in payrolls since the months immediately following the terrorist attacks of September 11, 2001. The continued weakness in the job market, as well as uncertainty associated with the war in Iraq and ongoing trepidation over the possibility of terrorist attacks, had a negative impact on the U.S. consumer. Consumer confidence fell approximately 15 points in February to 64.0, its third consecutive month of declines. After third quarter GDP growth of 4.0%, fourth quarter growth was initially estimated to be 0.7%. This figure was ultimately revised upward to 1.4%, which was above many forecasts. However, the adjustment was due in large part to greater than expected inventory reloading and an increase in government spending. Although there is very little evidence of upward pricing pressure in the majority of industries, a rapid rise in oil prices contributed to month-over-month increases in the Producer Price 2 Index ("PPI") and the Consumer Price Index ("CPI"). In January, the PPI, which measures changes in wholesale prices, jumped 1.6%, the largest month-over-month increase in 13 years. For the same period, the CPI, the most popular cost-of-living index, rose 0.3%, its most significant monthly increase since last April. Year-over-year, however, inflation remains relatively modest, with CPI growth of 2.6%. The manufacturing sector, as measured by the Institute for Supply Management Index, continues to grow, though it is doing so at a slower pace due in part to the rise in energy prices. Despite declining in recent months, February marked the fourth consecutive month of growth in manufacturing activity as the index finished the month at 50.5. Although December and January had higher readings of 55.2 and 53.9, respectively, any reading over 50 indicates expansion of activity. At its November meeting, the Federal Open Market Committee ("FOMC") reduced interest rates by 50 basis points ("bps"). In their decision to cut the Fed Funds rate, which now stands at a 41-year low, the FOMC cited the existence of greater uncertainty and geopolitical risks, which are, "currently inhibiting spending, production, and employment." Since that time, the economic recovery has continued to be sluggish amid considerable volatility and macro political issues. The FOMC elected to hold interest rates steady at both the January and March meetings, but the bond market has recently begun to price in the possibility of a further reduction in the coming months. The likelihood of this occurrence is a topic of considerable debate with interest rates already at historically low levels and the effect of further fiscal stimulus uncertain. Overall, the economy should be heading towards economic recovery, although recent data suggests perhaps not as quickly as initially had been predicted. Several obstacles remain, including an excess of capacity and a lack of pricing power, which is hampering profitability and restraining a pick-up in business investment. More importantly though, ongoing concerns and uncertainty over geopolitical risks continue to impair businesses and have negative effects on consumer confidence, both of which are crucial factors to a full economic recovery. However, as we continue to work through the recession following the speculative bubble of the late 1990s, accommodative monetary policy, additional fiscal stimulus, healthier corporate balance sheets and a weaker dollar should ultimately help to stimulate the economic environment. The volatility that has been widespread in the overall marketplace also was prevalent in the Treasury market. Although returns varied widely on a month-by-month basis, Treasuries rallied over the semi-annual period with yields across all maturities finishing the period lower than where they began. Continued global anxieties, as well as expectations and implications surrounding the FOMC's decision to reduce interest rates for the twelfth consecutive time since January 2001, were major themes in the market. Overall, these themes were positive for Treasuries and were only partially offset by equity rallies in October, November and January. The LEHMAN BROTHERS U.S. TREASURY INDEX returned 4.62% for the six months ended February 28, 2003. Over the semi-annual period, the yield curve steepened as securities with shorter maturities declined faster than those with longer maturities. In response to risk aversion and expectations for declining short-term interest rates, yields on 2- and 5-year Treasuries declined 62 bps and 56 bps, respectively. Yields of 10- and 30-year securities declined by 45 bps and 26 bps, respectively. During the period, the Bush Administration presented an ambitious fiscal stimulus package, which included future tax cuts while revoking the "double-taxation" of stock dividends. While it is unlikely that the package will be enacted in its original form, increased Treasury borrowing is a likely response to any future proposal that may ultimately be accepted. In fact, the Treasury announced plans for increased borrowing in February, stating that it would revive issuance of the 3-year note (which was discontinued in May 1998) and double the frequency of sales for the 5-year note. Looking ahead, as the amount of outstanding Treasury debt draws closer to the ceiling set by Congress, the Treasury Department will need to focus on taking measures to overcome this issue. Until a fiscal stimulus package is finalized, this adds another element of uncertainty to an already volatile Treasury market. For the semi-annual period ended February 28, 2003, municipals, as measured by the LEHMAN BROTHERS MUNICIPAL BOND INDEX, returned 3.36%. During this period, municipals were a strong performer overall, despite some temporary increases in interest rates. Municipals continue to attract interest from both retail and institutional accounts based upon the attractive taxable equivalent yields they provide. In 2002, the combination of widening budget deficits (due to declines in tax revenue at the state and local level) and historical low interest rates drove municipalities to issue a record number of bonds. Total issuance for 2002 was $357 billion, which surpassed the previous record set back in 1993 at $292 billion. New issue volume has been unrelenting in the early stages of 2003, setting new records for the largest January and February ever. Heightened issuance levels have persisted as many state and local governments continue to face weak fiscal conditions. Towards the end of the semi-annual period, heavy new issue supply, increased geopolitical tensions and a flight-to-quality in the Treasury market caused municipals to underper- 3 form most taxable sectors. An additional consideration regarding the municipal market is the potential impact of the proposed tax changes by President Bush. CALIFORNIA California is the nation's most populous state with 35 million residents spread over its 163,707 square miles. This massive population supports an economy that produces a $1.3 trillion annual economic output, vying with France for the world's fifth or sixth largest economy (depending on the dollar/euro exchange rate). The state's vast economy turned sluggish in January 2001 and since then job growth has remained relatively stagnant. The December 2002 jobless rate was 6.9%, higher than both the national rate of 6.0% and December 2001's 6.2% rate. In contrast to the slower economy, housing prices, spurred by low mortgage rates, continue to advance at a double digit pace (+20.4% in 2002) and the 2002 average median single-family home price was a record $315,870. Both California's General Fund revenues as well as spending rapidly increased between 1997 and 2001. More recently, a sluggish economy depressed revenue streams and the 2003 budget was passed two months late after closing a gap in excess of $23 billion. To meet cash needs in June 2002 the state sold $7.5 billion of revenue anticipation warrants ("RAWs") and in October 2002, California sold $12.5 billion revenue anticipation notes ("RANs"). The state's structural imbalance continues to grow as revenues decline more rapidly than expenditures. By January 2003, the state's anticipated General Fund deficit was acknowledged to be over $30 billion (for the next 18 months) due largely to the steep drop in personal income tax collections. Without corrective action the General Fund deficit for fiscal year 2003 alone is expected to exceed $8.5 billion and require the issuance of additional RAWs to repay the outstanding RANs. In order for the California legislature to address the state's significant structural imbalance, they will likely include both program cuts and tax/fee increases, among other things. Constitutionally the legislature must reach a consensus on corrective actions and pass a balanced budget by June 30, 2003. From the bondholder's perspective, however, California's large and diverse economy provides sufficient security, confirmed by Moody's Investor Services ("Moody's") and Standard &Poor's ("S&P") A1/A ratings. FLORIDA The state of Florida's historically strong financial position reflects prudent fiscal management combined with a solid and diversified economy. Florida's $472.1 billion total economic output (in 2000) makes it the nation's fourth largest state economy. The state's prudent fiscal management is reflected in its FY2002 unreserved General Fund balance of $2.0 billion, which is equal to 10.3% of total General Fund revenues. In addition, a budget stabilization fund ($941 million) provides an even greater financial cushion. This financial cushion provides additional security to both the state and its bondholders. During the recent economic expansion, Florida built up its budget stabilization fund to nearly $1 billion. The state government has met the challenges of limited revenue growth, the recession and the manifestations of the September 11th terrorist attacks, by lowering its income expectations and commensurate expenditures. Sales tax receipts are the General Fund's major revenue source (72% in FY2002) with tourism generating much of this income. Last year's revenue revisions were accurate and the state ended FY2002 with a surplus. Furthermore, current revenue receipts (through January 2003) are 100.8% of November's upward revisions. Florida residents' growing needs for Medicaid (2000 and 2001 combined increase was +22%) and education pressure the $50.4 billion budget for FY2003. Florida's policy is to maintain a manageable debt burden while continuing to use bonds to meet capital expenses. The state's 1997 tobacco settlement is expected to total $13 billion over 25 years. Florida expects to use this money ($3.3 billion as of June 30, 2002) for healthcare coverage and services. Florida's population increased at a 1.8% average annual rate between 1990 and 2000 to over 16 million residents. This compares to an average increase of 1% for the U.S. overall. Net migration into Florida accounted for 85% of its growth, with approximately one-third of the new residents coming from foreign countries. By 2000, elderly residents accounted for 17.5% of the state's population. Although economists anticipate slower future growth, Florida's population expansion continues to exceed that of the nation (April 2000-July 2001 +2.6% versus 1.2% for the U.S.). The state's economy is anchored by tourism, manufacturing and agriculture. The 5.3% unemployment rate (December 2002) is below that of a year ago (5.8%) and significantly below the national average (6.0% in December 2002). Trade and services, the major employment sectors, have remained flat. Manufacturing jobs continue their slow decline (3% year-over-year) and represent approximately 6% of Florida's employment, which is about one-half the national level. The construction industry is becoming less important as the state's economy diversifies. The state's large economy, combined with its conservative fiscal policy, merit its Aa2/AA+ ratings by Moody's and S&P. MARYLAND Maryland is primarily an urban state with 70% of its 5.3 million residents living in the eleven counties that constitute the "Baltimore-Washington Corridor." The state's highly skilled workforce is heavily concentrated in the service and government 4 employment sectors; information and high technology and defense spending are strong components of the state's economy. A history of relatively low unemployment rates (December 2002 is 4.2% versus 6.0% for the U.S.) has supported personal income growth over the past decade and the state's per capita income has ranked fifth among the states since 1992. This high wealth level supports retail sales tax receipts, which have increased at a 5.1% average annual rate for the last ten years. As a result of the recent recession, Maryland's General Fund expenditures have increased more rapidly than revenues. Prudent financial management resulted in a FY2002 unreserved General Fund balance equal to 1.9% of revenues, while the rate stabilization fund decreased to over $650 million. Reserve funds were used in FY2002 to supplement revenues, which dropped below budgeted levels. In FY2003, decreased income resulted in a budget gap at approximately 4% of revenues. Proposals to fill the gap include revenue increases and interfund transfers in order to end FY2004 with an operating surplus. The state's Aaa/AAA rating reflects Maryland's fundamentally strong, diverse economy, with above average income levels and responsible fiscal management. NEW JERSEY Despite a strong and diversified economy, employment in New Jersey peaked in June of 2001. The past decade's economic expansion fueled the state's dramatic increase in per capita disposable personal income to become the highest in the nation. Nevertheless, New Jersey's economy was directly shaken by the events of September 11th and the continued correction in the financial markets. Reflecting this, the December 2002 unemployment rate increased to 6.0%, significantly higher than the 5.2% rate a year earlier. Manufacturing employment continues its declining trend. Until this year, New Jersey was able to rely on its strong and growing economy to support annual spending increases. This increasing prosperity between 1993 and 2000 enabled New Jersey to afford income, business and corporate tax reductions and still maintain a year-end (2001) operating surplus with reserve funds in excess of $1 billion. In contrast, FY2002 saw significant declines in tax receipts and New Jersey chose to use all of its reserve funds to plug a deficit in excess of 12% of General Fund revenues. The FY2003 budget gap is estimated at $1.1 billion due to lower revenues and increased spending, especially in healthcare. A spending freeze and tobacco securitization bond proceeds are included as gap filling measures. New Jersey's FY2004 budgetary structural imbalance is estimated to be between $4.2 and $5 billion and the Governor proposes addressing this with spending reductions and $2 billion of one-time revenue sources. The state's debt burden remains manageable despite the 71% increase in appropriation bonds over the past five years. New Jersey's debt ratings (Aa2/AA) were downgraded in 2002, reflecting the sluggish economy. NEW YORK Prudent and responsive fiscal management combined with sufficient reserve funds helped cushion the impact of the recession and the September 11th terrorist attacks on New York State's fiscal well-being. After September 11th, economic growth in New York ceased and the unemployment rate increased to 6.4% (December 2002). Year-over-year (December 2001 to December 2002) statewide, non-agrarian employment has decreased less than 1% and remains over 8.5 million jobs. The state has a broad and diverse economic base with a substantial foundation of wealth and resources. However, the terrorist attacks, the recession and the drop in Wall Street employment and profits have had a negative impact on state finances. New York used the FY2001 surplus ($1.6 billion) to meet its budgetary needs in FY2002, diminishing the state's fiscal flexibility. The FY2003 budget was produced in a timely manner, which helped to maintain New York State's AA rating from S&P. However, the state is faced with challenges in maintaining balanced operations, as tax receipts are approximately $2 billion below projections. By early 2003, the Governor acknowledged a budget gap that may be as large as $9.3 billion over the next 18 months. General Fund revenues, in particular personal and corporate income tax, are below estimates while costs including Medicaid and pensions have exceeded expectations. The projected FY2004 gap must be closed at the end of the fiscal year (March 31st). The state's fiscal health is directly linked to that of New York City. The combined impact of September 11th, the slowdown in financial markets (a major contributor to New York finances), and the lackluster national economy have all contributed to reduced revenues for both the city and the state of New York. New York City's economy has lost approximately 150,000 jobs since its peak in January 2001; the economic cycle, exacerbated by the events of September 11th, are responsible for the city's unemployment rate rising to 8.4% by December 2002. The NYC Comptroller's Office does not expect the city's economy to rebound until mid-2003. The city ended FY2002 with a balanced budget and closed an over $4 billion budget gap for FY2003. Currently, the flow of tax revenues is below projections and the city is taking corrective actions to bring revenues and expenditures in balance. Revenue uncertainty and the potential for imminent structural imbalance prompted Moody's and S&P to keep the city's A2/A bond ratings on negative outlook. For bondholders, New York State's diverse economy and financial management provide sufficient security. 5 VIRGINIA Virginia maintains a strong economy with responsible fiscal management. The commonwealth's fiscal position significantly improved during the last decade. The commonwealth's skilled labor force fed into the expanding job opportunities, especially in the high tech and government employment sectors. This economic growth produced low unemployment rates and fueled the state's per capita income, which exceeded that of the U.S. during the 1990s. Virginia's 2.2% jobless rate, in 2000, was the lowest in the nation and significantly below the national average. The 2001 national recession, and particularly the slowdown in technology, began to affect the commonwealth's economy. During FY2002 Virginia's revenues fell approximately 4% while expenditures continued to grow. This resulted in a General Fund operating deficit of 11.7% in FY2002. The negative trend continues into FY2003 as Medicare costs and declining tax receipts contributed to a budget gap of $950 million. Revenues, which are now meeting revised projections, and additional spending cuts are planned to balance operations through the FY2004 biennium. The commonwealth is rated Aaa/AAA and continued strong, conservative financial management will be needed to maintain this rating and to provide the highest level of bondholder security. THE TRUSTS' PORTFOLIOS AND INVESTMENT STRATEGIES The Trusts' portfolios are actively managed to diversify exposure to various sectors, issuers, revenue sources and security types. BlackRock's investment strategy emphasizes a relative value approach, which allows the Trusts to capitalize upon changing market conditions by rotating municipal sectors, credits and coupons. Additionally, each of the Trusts in this report may employ leverage to enhance their income by borrowing at short-term municipal rates and investing the proceeds in longer maturity issues which typically have higher yields. The degree to which the Trusts can benefit from their use of leverage may affect their ability to pay high monthly income. The table below summarizes the approximate amount of leverage, as a percentage of managed assets, for each Trust at February 28, 2003. TRUST LEVERAGE - -------------------------------------------------------------------------------- BLACKROCK INSURED MUNICIPAL INCOME TRUST (BYM) 38% BLACKROCK MUNICIPAL BOND TRUST (BBK) 38 BLACKROCK MUNICIPAL INCOME TRUST II (BLE) 39 BLACKROCK CALIFORNIA INSURED MUNICIPAL INCOME TRUST (BCK) 38 BLACKROCK CALIFORNIA MUNICIPAL BOND TRUST (BZA) 38 BLACKROCK CALIFORNIA MUNICIPAL INCOME TRUST II (BCL) 39 BLACKROCK FLORIDA INSURED MUNICIPAL INCOME TRUST (BAF) 38 BLACKROCK FLORIDA MUNICIPAL BOND TRUST (BIE) 37 BLACKROCK MARYLAND MUNICIPAL BOND TRUST (BZM) 37 BLACKROCK NEW JERSEY MUNICIPAL BOND TRUST (BLJ) 38 BLACKROCK NEW YORK INSURED MUNICIPAL INCOME TRUST (BSE) 38 BLACKROCK NEW YORK MUNICIPAL BOND TRUST (BQH) 38 BLACKROCK NEW YORK MUNICIPAL INCOME TRUST II (BFY) 39 BLACKROCK VIRGINIA MUNICIPAL BOND TRUST (BHV) 37 We look forward to continuing to manage BlackRock's closed-end municipal funds to benefit from the opportunities available to investors in the fixed income markets. We thank you for your investment and continued confidence in the BlackRock closed-end municipal funds. Please feel free to call our marketing center at (800) 227-7BFM (7236) if you have any specific questions that were not addressed in this report. Sincerely, /s/ Robert S. Kapito /s/ Kevin M. Klingert Robert S. Kapito Kevin M. Klingert Vice Chairman and Portfolio Manager Managing Director and Portfolio Manager BlackRock Advisors, Inc. BlackRock Advisors, Inc. 6 TRUST SUMMARIES (unaudited) FEBRUARY 28, 2003 - ---------------------------------------- BlackRock Insured Municipal Income Trust - ---------------------------------------- TRUST INFORMATION - -------------------------------------------------------------------------------- Symbol on New York Stock Exchange: BYM - -------------------------------------------------------------------------------- Initial Offering Date: October 31, 2002 - -------------------------------------------------------------------------------- Closing Market Price as of 2/28/03: $14.01 - -------------------------------------------------------------------------------- Net Asset Value as of 2/28/03: $14.52 - -------------------------------------------------------------------------------- Yield on Closing Market Price as of 2/28/03 ($14.01):(1) 6.69% - -------------------------------------------------------------------------------- Current Monthly Distribution per Common Share:(2) $ 0.078125 - -------------------------------------------------------------------------------- Current Annualized Distribution per Common Share:(2) $ 0.937500 - -------------------------------------------------------------------------------- (1) Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. (2) The distribution is not constant and is subject to change. The table below summarizes the changes in the Trust's market price and NAV from inception date to 2/28/03: ----------------------------------------------------- 2/28/03 HIGH LOW - -------------------------------------------------------------------------------- MARKET PRICE $14.01 $15.05 $13.61 - -------------------------------------------------------------------------------- NAV $14.52 $14.59 $14.14 - -------------------------------------------------------------------------------- The following charts show the Trust's asset composition and credit quality allocations: SECTOR BREAKDOWN -------------------------------------------------------------- SECTOR FEBRUARY 28, 2003 -------------------------------------------------------------- Transportation 32% -------------------------------------------------------------- City, County & State 19 -------------------------------------------------------------- Water & Sewer 15 -------------------------------------------------------------- Tobacco 10 -------------------------------------------------------------- Power 10 -------------------------------------------------------------- Industrial & Pollution Control 3 -------------------------------------------------------------- Tax Revenue 2 -------------------------------------------------------------- Hospital 2 -------------------------------------------------------------- Housing 2 -------------------------------------------------------------- Lease Revenue 2 -------------------------------------------------------------- Recreational 1 -------------------------------------------------------------- Education 1 -------------------------------------------------------------- Other 1 -------------------------------------------------------------- CREDIT BREAKDOWN* -------------------------------------------------------------- CREDIT RATING FEBRUARY 28, 2003 -------------------------------------------------------------- AAA/Aaa 82% -------------------------------------------------------------- A 15 -------------------------------------------------------------- BBB/Baa 3 -------------------------------------------------------------- ----------- * Using the higher of S&P's, Moody's or Fitch's rating. Percentages based on long-term investments. 7 TRUST SUMMARIES (unaudited) FEBRUARY 28, 2003 - ---------------------------------------- BlackRock Insured Municipal Income Trust - ---------------------------------------- TRUST INFORMATION - -------------------------------------------------------------------------------- Symbol on New York Stock Exchange: BBK - -------------------------------------------------------------------------------- Initial Offering Date: April 30, 2002 - -------------------------------------------------------------------------------- Closing Market Price as of 2/28/03: $14.00 - -------------------------------------------------------------------------------- Net Asset Value as of 2/28/03: $14.80 - -------------------------------------------------------------------------------- Yield on Closing Market Price as of 2/28/03 ($14.00):(1) 7.23% - -------------------------------------------------------------------------------- Current Monthly Distribution per Common Share:(2) $ 0.084375 - -------------------------------------------------------------------------------- Current Annualized Distribution per Common Share:(2) $ 1.012500 - -------------------------------------------------------------------------------- (1) Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. (2) The distribution is not constant and is subject to change. The table below summarizes the changes in the Trust's market price and NAV: --------------------------------------------------------------- 2/28/03 8/31/02 CHANGE HIGH LOW - -------------------------------------------------------------------------------- MARKET PRICE $14.00 $14.90 (6.04)% $14.98 $13.34 - -------------------------------------------------------------------------------- NAV $14.80 $14.76 0.27% $15.23 $13.97 - -------------------------------------------------------------------------------- The following charts show the Trust's asset composition and credit quality allocations: SECTOR BREAKDOWN - -------------------------------------------------------------------------------- SECTOR FEBRUARY 28, 2003 AUGUST 31, 2002 - -------------------------------------------------------------------------------- Industrial & Pollution Control 25% 27% - -------------------------------------------------------------------------------- Hospitals 20 18 - -------------------------------------------------------------------------------- Housing 13 13 - -------------------------------------------------------------------------------- Tobacco 11 12 - -------------------------------------------------------------------------------- City, County & State 9 8 - -------------------------------------------------------------------------------- Transportation 7 7 - -------------------------------------------------------------------------------- Tax Revenue 5 6 - -------------------------------------------------------------------------------- Power 3 3 - -------------------------------------------------------------------------------- Education 2 2 - -------------------------------------------------------------------------------- Other 5 4 - -------------------------------------------------------------------------------- CREDIT BREAKDOWN* - -------------------------------------------------------------------------------- CREDIT RATING FEBRUARY 28, 2003 AUGUST 31, 2002 - -------------------------------------------------------------------------------- AAA/Aaa 25% 24% - -------------------------------------------------------------------------------- AA/Aa 4 4 - -------------------------------------------------------------------------------- A 38 39 - -------------------------------------------------------------------------------- BBB/Baa 22 22 - -------------------------------------------------------------------------------- BB/Ba -- 3 - -------------------------------------------------------------------------------- B 4 1 - -------------------------------------------------------------------------------- Not Rated 7 7 - -------------------------------------------------------------------------------- - --------- * Using the higher of S&P's, Moody's or Fitch's rating. Percentages based on long-term investments. 8 TRUST SUMMARIES (unaudited) FEBRUARY 28, 2003 - ----------------------------------- BlackRock Municipal Income Trust II - ----------------------------------- TRUST INFORMATION - -------------------------------------------------------------------------------- Symbol on American Stock Exchange: BLE - -------------------------------------------------------------------------------- Initial Offering Date: July 30, 2002 - -------------------------------------------------------------------------------- Closing Market Price as of 2/28/03: $13.75 - -------------------------------------------------------------------------------- Net Asset Value as of 2/28/03: $14.13 - -------------------------------------------------------------------------------- Yield on Closing Market Price as of 2/28/03 ($13.75):(1) 7.31% - -------------------------------------------------------------------------------- Current Monthly Distribution per Common Share:(2) $ 0.08375 - -------------------------------------------------------------------------------- Current Annualized Distribution per Common Share:(2) $ 1.00500 - -------------------------------------------------------------------------------- (1) Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. (2) The distribution is not constant and is subject to change. The table below summarizes the changes in the Trust's market price and NAV: ------------------------------------------------------------- 2/28/03 8/31/02 CHANGE HIGH LOW - -------------------------------------------------------------------------------- MARKET PRICE $13.75 $15.00 (8.33)% $15.05 $12.95 - -------------------------------------------------------------------------------- NAV $14.13 $14.40 (1.88)% $14.63 $13.22 - -------------------------------------------------------------------------------- The following charts show the Trust's asset composition and credit quality allocations: SECTOR BREAKDOWN - -------------------------------------------------------------------------------- SECTOR FEBRUARY 28, 2003 AUGUST 31, 2002 - -------------------------------------------------------------------------------- Hospitals 23% 15% - -------------------------------------------------------------------------------- Tobacco 15 17 - -------------------------------------------------------------------------------- Industrial & Pollution Control 14 12 - -------------------------------------------------------------------------------- City, County & State 11 15 - -------------------------------------------------------------------------------- Housing 10 4 - -------------------------------------------------------------------------------- Transportation 9 9 - -------------------------------------------------------------------------------- Water & Sewer 8 8 - -------------------------------------------------------------------------------- Tax Revenue 6 8 - -------------------------------------------------------------------------------- Power 2 2 - -------------------------------------------------------------------------------- Education 1 10 - -------------------------------------------------------------------------------- Lease Revenue 1 -- - -------------------------------------------------------------------------------- CREDIT BREAKDOWN* - -------------------------------------------------------------------------------- CREDIT RATING FEBRUARY 28, 2003 AUGUST 31, 2002 - -------------------------------------------------------------------------------- AAA/Aaa 30% 31% - -------------------------------------------------------------------------------- AA/Aa 8 11 - -------------------------------------------------------------------------------- A 38 38 - -------------------------------------------------------------------------------- BBB/Baa 13 11 - -------------------------------------------------------------------------------- BB/Ba -- 4 - -------------------------------------------------------------------------------- B 5 5 - -------------------------------------------------------------------------------- Not Rated 6 -- - -------------------------------------------------------------------------------- - ---------- * Using the higher of S&P's, Moody's or Fitch's rating. Percentages based on long-term investments. 9 TRUST SUMMARIES (unaudited) FEBRUARY 28, 2003 - --------------------------------------------------- BlackRock California Insured Municipal Income Trust - --------------------------------------------------- TRUST INFORMATION - -------------------------------------------------------------------------------- Symbol on the New York Stock Exchange: BCK - -------------------------------------------------------------------------------- Initial Offering Date: October 31, 2002 - -------------------------------------------------------------------------------- Closing Market Price as of 2/28/03: $13.97 - -------------------------------------------------------------------------------- Net Asset Value as of 2/28/03: $14.32 - -------------------------------------------------------------------------------- Yield on Closing Market Price as of 2/28/03 ($13.97):(1) 6.44% - -------------------------------------------------------------------------------- Current Monthly Distribution per Common Share:(2) $ 0.075 - -------------------------------------------------------------------------------- Current Annualized Distribution per Common Share:(2) $ 0.900 - -------------------------------------------------------------------------------- (1) Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. (2) The distribution is not constant and is subject to change. The table below summarizes the changes in the Trust's market price and NAV from inception date to 2/28/03: ------------------------------------------------------ 2/28/03 HIGH LOW - -------------------------------------------------------------------------------- MARKET PRICE $13.97 $15.01 $13.65 - -------------------------------------------------------------------------------- NAV $14.32 $14.56 $13.90 - -------------------------------------------------------------------------------- The following charts show the Trust's asset composition and credit quality allocations: SECTOR BREAKDOWN -------------------------------------------------------------- SECTOR FEBRUARY 28, 2003 -------------------------------------------------------------- Water & Sewer 30% -------------------------------------------------------------- Education 23 -------------------------------------------------------------- Tobacco 11 -------------------------------------------------------------- Power 10 -------------------------------------------------------------- Lease Revenue 9 -------------------------------------------------------------- City, County & State 7 -------------------------------------------------------------- Tax Revenue 4 -------------------------------------------------------------- Transportation 4 -------------------------------------------------------------- Housing 2 -------------------------------------------------------------- CREDIT BREAKDOWN* -------------------------------------------------------------- CREDIT RATING FEBRUARY 28, 2003 -------------------------------------------------------------- AAA/Aaa 84% -------------------------------------------------------------- A 16 -------------------------------------------------------------- ----------- * Using the higher of S&P's, Moody's or Fitch's rating. Percentages based on long-term investments. 10 TRUST SUMMARIES (unaudited) FEBRUARY 28, 2003 - ----------------------------------------- BlackRock California Municipal Bond Trust - ----------------------------------------- TRUST INFORMATION - -------------------------------------------------------------------------------- Symbol on New York Stock Exchange: BZA - -------------------------------------------------------------------------------- Initial Offering Date: April 30, 2002 - -------------------------------------------------------------------------------- Closing Market Price as of 2/28/03: $13.46 - -------------------------------------------------------------------------------- Net Asset Value as of 2/28/03: $14.77 - -------------------------------------------------------------------------------- Yield on Closing Market Price as of 2/28/03 ($13.46):(1) 6.97% - -------------------------------------------------------------------------------- Current Monthly Distribution per Common Share:(2) $ 0.078125 - -------------------------------------------------------------------------------- Current Annualized Distribution per Common Share:(2) $ 0.937500 - -------------------------------------------------------------------------------- (1) Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. (2) The distribution is not constant and is subject to change. The table below summarizes the changes in the Trust's market price and NAV: --------------------------------------------------------------- 2/28/03 8/31/02 CHANGE HIGH LOW - -------------------------------------------------------------------------------- MARKET PRICE $13.46 $14.58 (7.68)% $14.97 $13.25 - -------------------------------------------------------------------------------- NAV $14.77 $14.87 (0.67)% $15.46 $14.24 - -------------------------------------------------------------------------------- The following charts show the Trust's asset composition and credit quality allocations: SECTOR BREAKDOWN - -------------------------------------------------------------------------------- SECTOR FEBRUARY 28, 2003 AUGUST 31, 2002 - -------------------------------------------------------------------------------- Education 23% 21% - -------------------------------------------------------------------------------- Hospitals 17 17 - -------------------------------------------------------------------------------- Housing 14 14 - -------------------------------------------------------------------------------- Tobacco 12 9 - -------------------------------------------------------------------------------- City, County & State 9 11 - -------------------------------------------------------------------------------- Power 7 2 - -------------------------------------------------------------------------------- Transportation 5 9 - -------------------------------------------------------------------------------- Water & Sewer 5 9 - -------------------------------------------------------------------------------- Industrial & Pollution Control 2 2 - -------------------------------------------------------------------------------- Lease Revenue 1 1 - -------------------------------------------------------------------------------- Other 5 5 - -------------------------------------------------------------------------------- CREDIT BREAKDOWN* - -------------------------------------------------------------------------------- CREDIT RATING FEBRUARY 28, 2003 AUGUST 31, 2002 - -------------------------------------------------------------------------------- AAA/Aaa 23% 34% - -------------------------------------------------------------------------------- A 49 41 - -------------------------------------------------------------------------------- BBB/Baa 9 9 - -------------------------------------------------------------------------------- BB/Ba -- 2 - -------------------------------------------------------------------------------- B 2 0 - -------------------------------------------------------------------------------- Not Rated 17 14 - -------------------------------------------------------------------------------- - ---------- * Using the higher of S&P's, Moody's or Fitch's rating. Percentages based on long-term investments. 11 TRUST SUMMARIES (unaudited) FEBRUARY 28, 2003 - ---------------------------------------------- BlackRock California Municipal Income Trust II - ---------------------------------------------- TRUST INFORMATION - -------------------------------------------------------------------------------- Symbol on American Stock Exchange: BCL - -------------------------------------------------------------------------------- Initial Offering Date: July 30, 2002 - -------------------------------------------------------------------------------- Closing Market Price as of 2/28/03: $13.60 - -------------------------------------------------------------------------------- Net Asset Value as of 2/28/03: $13.92 - -------------------------------------------------------------------------------- Yield on Closing Market Price as of 2/28/03 ($13.60):(1) 7.17% - -------------------------------------------------------------------------------- Current Monthly Distribution per Common Share:(2) $ 0.08125 - -------------------------------------------------------------------------------- Current Annualized Distribution per Common Share:(2) $ 0.97500 - -------------------------------------------------------------------------------- (1) Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. (2) The distribution is not constant and is subject to change. The table below summarizes the changes in the Trust's market price and NAV: --------------------------------------------------------------- 2/28/03 8/31/02 CHANGE HIGH LOW - -------------------------------------------------------------------------------- MARKET PRICE $13.60 $15.01 (9.39)% $15.09 $13.00 - -------------------------------------------------------------------------------- NAV $13.92 $14.42 (3.47)% $14.77 $13.26 - -------------------------------------------------------------------------------- The following charts show the Trust's asset composition and credit quality allocations: SECTOR BREAKDOWN - -------------------------------------------------------------------------------- SECTOR FEBRUARY 28, 2003 AUGUST 31, 2002 - -------------------------------------------------------------------------------- City, County & State 20% 21% - -------------------------------------------------------------------------------- Education 20 26 - -------------------------------------------------------------------------------- Hospitals 12 12 - -------------------------------------------------------------------------------- Tobacco 12 9 - -------------------------------------------------------------------------------- Transportation 9 10 - -------------------------------------------------------------------------------- Water & Sewer 6 -- - -------------------------------------------------------------------------------- Lease Revenue 5 7 - -------------------------------------------------------------------------------- Power 5 5 - -------------------------------------------------------------------------------- Housing 5 -- - -------------------------------------------------------------------------------- Industrial & Pollution Control 4 5 - -------------------------------------------------------------------------------- Tax Revenue 2 5 - -------------------------------------------------------------------------------- CREDIT BREAKDOWN* - -------------------------------------------------------------------------------- CREDIT RATING FEBRUARY 28, 2003 AUGUST 31, 2002 - -------------------------------------------------------------------------------- AAA/Aaa 49% 77% - -------------------------------------------------------------------------------- A 30 14 - -------------------------------------------------------------------------------- BBB/Baa 3 -- - -------------------------------------------------------------------------------- BB/Ba -- 2 - -------------------------------------------------------------------------------- B 1 0 - -------------------------------------------------------------------------------- Not Rated 17 7 - -------------------------------------------------------------------------------- - ---------- * Using the higher of S&P's, Moody's or Fitch's rating. Percentages based on long-term investments. 12 TRUST SUMMARIES (unaudited) FEBRUARY 28, 2003 - ------------------------------------------------ BlackRock Florida Insured Municipal Income Trust - ------------------------------------------------ TRUST INFORMATION - -------------------------------------------------------------------------------- Symbol on New York Stock Exchange: BAF - -------------------------------------------------------------------------------- Initial Offering Date: October 31, 2002 - -------------------------------------------------------------------------------- Closing Market Price as of 2/28/03: $14.34 - -------------------------------------------------------------------------------- Net Asset Value as of 2/28/03: $14.50 - -------------------------------------------------------------------------------- Yield on Closing Market Price as of 2/28/03 ($14.34):(1) 6.28% - -------------------------------------------------------------------------------- Current Monthly Distribution per Common Share:(2) $ 0.075 - -------------------------------------------------------------------------------- Current Annualized Distribution per Common Share:(2) $ 0.900 - -------------------------------------------------------------------------------- (1) Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. (2) The distribution is not constant and is subject to change. The table below summarizes the changes in the Trust's market price and NAV from inception date to 2/28/03: --------------------------------------------------- 2/28/03 HIGH LOW - -------------------------------------------------------------------------------- MARKET PRICE $14.34 $15.45 $14.25 - -------------------------------------------------------------------------------- NAV $14.50 $14.50 $14.13 - -------------------------------------------------------------------------------- The following charts show the Trust's asset composition and credit quality allocations: SECTOR BREAKDOWN ------------------------------------------------------------ SECTOR FEBRUARY 28, 2003 ------------------------------------------------------------ Education 31% ------------------------------------------------------------ City, County & State 13 ------------------------------------------------------------ Power 13 ------------------------------------------------------------ Hospital 10 ------------------------------------------------------------ Tax Revenue 10 ------------------------------------------------------------ Water & Sewer 6 ------------------------------------------------------------ Transportation 5 ------------------------------------------------------------ Tobacco 5 ------------------------------------------------------------ Housing 3 ------------------------------------------------------------ Lease Revenue 1 ------------------------------------------------------------ Other 3 ------------------------------------------------------------ CREDIT BREAKDOWN* ------------------------------------------------------------ CREDIT RATING FEBRUARY 28, 2003 ------------------------------------------------------------ AAA/Aaa 82% ------------------------------------------------------------ AA/Aa 4 ------------------------------------------------------------ A 11 ------------------------------------------------------------ Not Rated 3 ------------------------------------------------------------ ---------- * Using the higher of S&P's, Moody's or Fitch's rating. Percentages based on long-term investments. 13 TRUST SUMMARIES (unaudited) FEBRUARY 28, 2003 - -------------------------------------- BlackRock Florida Municipal Bond Trust - -------------------------------------- TRUST INFORMATION - -------------------------------------------------------------------------------- Symbol on New York Stock Exchange: BIE - -------------------------------------------------------------------------------- Initial Offering Date: April 30, 2002 - -------------------------------------------------------------------------------- Closing Market Price as of 2/28/03: $14.32 - -------------------------------------------------------------------------------- Net Asset Value as of 2/28/03: $15.19 - -------------------------------------------------------------------------------- Yield on Closing Market Price as of 2/28/03 ($14.32):(1) 6.39% - -------------------------------------------------------------------------------- Current Monthly Distribution per Common Share:(2) $ 0.07625 - -------------------------------------------------------------------------------- Current Annualized Distribution per Common Share:(2) $ 0.91500 - -------------------------------------------------------------------------------- (1) Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. (2) The distribution is not constant and is subject to change. The table below summarizes the changes in the Trust's market price and NAV: ----------------------------------------------------------- 2/28/03 8/31/02 CHANGE HIGH LOW - -------------------------------------------------------------------------------- MARKET PRICE $14.32 $14.92 (4.02)% $15.20 $14.09 - -------------------------------------------------------------------------------- NAV $15.19 $14.90 1.95% $15.54 $14.43 - -------------------------------------------------------------------------------- The following charts show the Trust's asset composition and credit quality allocations: SECTOR BREAKDOWN - -------------------------------------------------------------------------------- SECTOR FEBRUARY 28, 2003 AUGUST 31, 2002 - -------------------------------------------------------------------------------- Hospitals 24% 24% - -------------------------------------------------------------------------------- Tax Revenue 15 14 - -------------------------------------------------------------------------------- Power 14 14 - -------------------------------------------------------------------------------- Housing 7 -- - -------------------------------------------------------------------------------- Water & Sewer 7 7 - -------------------------------------------------------------------------------- Lease Revenue 6 9 - -------------------------------------------------------------------------------- City, County & State 6 10 - -------------------------------------------------------------------------------- Industrial & Pollution Control 5 5 - -------------------------------------------------------------------------------- Tobacco 4 -- - -------------------------------------------------------------------------------- Transportation 4 4 - -------------------------------------------------------------------------------- Education 4 5 - -------------------------------------------------------------------------------- Other 4 8 - -------------------------------------------------------------------------------- CREDIT BREAKDOWN* - -------------------------------------------------------------------------------- CREDIT RATING FEBRUARY 28, 2003 AUGUST 31, 2002 - -------------------------------------------------------------------------------- AAA/Aaa 44% 60% - -------------------------------------------------------------------------------- AA/Aa 14 7 - -------------------------------------------------------------------------------- A 32 29 - -------------------------------------------------------------------------------- Not Rated 10 4 - -------------------------------------------------------------------------------- - ---------- * Using the higher of S&P's, Moody's or Fitch's rating. Percentages based on long-term investments. 14 TRUST SUMMARIES (unaudited) FEBRUARY 28, 2003 - --------------------------------------- BlackRock Maryland Municipal Bond Trust - --------------------------------------- TRUST INFORMATION - -------------------------------------------------------------------------------- Symbol on American Stock Exchange: BZM - -------------------------------------------------------------------------------- Initial Offering Date: April 30, 2002 - -------------------------------------------------------------------------------- Closing Market Price as of 2/28/03: $14.55 - -------------------------------------------------------------------------------- Net Asset Value as of 2/28/03: $15.03 - -------------------------------------------------------------------------------- Yield on Closing Market Price as of 2/28/03 ($14.55):(1) 5.77% - -------------------------------------------------------------------------------- Current Monthly Distribution per Common Share:(2) $ 0.07 - -------------------------------------------------------------------------------- Current Annualized Distribution per Common Share:(2) $ 0.84 - -------------------------------------------------------------------------------- (1) Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. (2) The distribution is not constant and is subject to change. The table below summarizes the changes in the Trust's market price and NAV: -------------------------------------------------------------- 2/28/03 8/31/02 CHANGE HIGH LOW - -------------------------------------------------------------------------------- MARKET PRICE $14.55 $14.95 (2.68)% $15.70 $14.35 - -------------------------------------------------------------------------------- NAV $15.03 $14.76 1.83% $15.40 $14.29 - -------------------------------------------------------------------------------- The following charts show the Trust's asset composition and credit quality allocations: SECTOR BREAKDOWN - -------------------------------------------------------------------------------- SECTOR FEBRUARY 28, 2003 AUGUST 31, 2002 - -------------------------------------------------------------------------------- Education 26% 23% - -------------------------------------------------------------------------------- Hospitals 17 17 - -------------------------------------------------------------------------------- Water & Sewer 12 12 - -------------------------------------------------------------------------------- Lease Revenue 9 16 - -------------------------------------------------------------------------------- City, County & State 9 9 - -------------------------------------------------------------------------------- Transportation 9 9 - -------------------------------------------------------------------------------- Housing 5 6 - -------------------------------------------------------------------------------- Power 5 4 - -------------------------------------------------------------------------------- Tobacco 4 -- - -------------------------------------------------------------------------------- Other 4 4 - -------------------------------------------------------------------------------- CREDIT BREAKDOWN* - -------------------------------------------------------------------------------- CREDIT RATING FEBRUARY 28, 2003 AUGUST 31, 2002 - -------------------------------------------------------------------------------- AAA/Aaa 34% 34% - -------------------------------------------------------------------------------- AA/Aa 14 23 - -------------------------------------------------------------------------------- A 41 35 - -------------------------------------------------------------------------------- BBB/Baa 7 4 - -------------------------------------------------------------------------------- Not Rated 4 4 - -------------------------------------------------------------------------------- - ---------- * Using the higher of S&P's, Moody's or Fitch's rating. Percentages based on long-term investments. 15 TRUST SUMMARIES (unaudited) FEBRUARY 28, 2003 - ----------------------------------------- BlackRock New Jersey Municipal Bond Trust - ----------------------------------------- TRUST INFORMATION - -------------------------------------------------------------------------------- Symbol on American Stock Exchange: BLJ - -------------------------------------------------------------------------------- Initial Offering Date: April 30, 2002 - -------------------------------------------------------------------------------- Closing Market Price as of 2/28/03: $13.75 - -------------------------------------------------------------------------------- Net Asset Value as of 2/28/03: $14.40 - -------------------------------------------------------------------------------- Yield on Closing Market Price as of 2/28/03 ($13.75):(1) 6.76% - -------------------------------------------------------------------------------- Current Monthly Distribution per Common Share:(2) $ 0.0775 - -------------------------------------------------------------------------------- Current Annualized Distribution per Common Share:(2) $ 0.9300 - -------------------------------------------------------------------------------- (1) Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. (2) The distribution is not constant and is subject to change. The table below summarizes the changes in the Trust's market price and NAV: ------------------------------------------------------------- 2/28/03 8/31/02 CHANGE HIGH LOW - -------------------------------------------------------------------------------- MARKET PRICE $13.75 $14.65 (6.14)% $15.00 $13.36 - -------------------------------------------------------------------------------- NAV $14.40 $14.58 (1.23)% $14.92 $13.84 - -------------------------------------------------------------------------------- The following charts show the Trust's asset composition and credit quality allocations: SECTOR BREAKDOWN - -------------------------------------------------------------------------------- SECTOR FEBRUARY 28, 2003 AUGUST 31, 2002 - -------------------------------------------------------------------------------- Hospitals 24% 24% - -------------------------------------------------------------------------------- Transportation 17 17 - -------------------------------------------------------------------------------- Housing 15 15 - -------------------------------------------------------------------------------- Tobacco 12 9 - -------------------------------------------------------------------------------- Lease Revenue 10 9 - -------------------------------------------------------------------------------- City, County & State 5 5 - -------------------------------------------------------------------------------- Power 5 4 - -------------------------------------------------------------------------------- Education 4 5 - -------------------------------------------------------------------------------- Industrial & Pollution Control 4 4 - -------------------------------------------------------------------------------- Recreational -- 4 - -------------------------------------------------------------------------------- Other 4 4 - -------------------------------------------------------------------------------- CREDIT BREAKDOWN* - -------------------------------------------------------------------------------- CREDIT RATING FEBRUARY 28, 2003 AUGUST 31, 2002 - -------------------------------------------------------------------------------- AAA/Aaa 23% 26% - -------------------------------------------------------------------------------- AA/Aa -- 4 - -------------------------------------------------------------------------------- A 48 44 - -------------------------------------------------------------------------------- BBB/Baa 21 18 - -------------------------------------------------------------------------------- B 4 4 - -------------------------------------------------------------------------------- Not Rated 4 4 - -------------------------------------------------------------------------------- - ---------- * Using the higher of S&P's, Moody's or Fitch's rating. Percentages based on long-term investments. 16 TRUST SUMMARIES (unaudited) FEBRUARY 28, 2003 - ------------------------------------------------- BlackRock New York Insured Municipal Income Trust - ------------------------------------------------- TRUST INFORMATION - -------------------------------------------------------------------------------- Symbol on New York Stock Exchange: BSE - -------------------------------------------------------------------------------- Initial Offering Date: October 31, 2002 - -------------------------------------------------------------------------------- Closing Market Price as of 2/28/03: $14.42 - -------------------------------------------------------------------------------- Net Asset Value as of 2/28/03: $14.45 - -------------------------------------------------------------------------------- Yield on Closing Market Price as of 2/28/03 ($14.42):(1) 6.24% - -------------------------------------------------------------------------------- Current Monthly Distribution per Common Share:(2) $ 0.075 - -------------------------------------------------------------------------------- Current Annualized Distribution per Common Share:(2) $ 0.900 - -------------------------------------------------------------------------------- (1) Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. (2) The distribution is not constant and is subject to change. The table below summarizes the changes in the Trust's market price and NAV from inception date to 2/28/03: -------------------------------------------------- 2/28/03 HIGH LOW - -------------------------------------------------------------------------------- MARKET PRICE $14.42 $15.04 $13.81 - -------------------------------------------------------------------------------- NAV $14.45 $14.49 $14.06 - -------------------------------------------------------------------------------- The following charts show the Trust's asset composition and credit quality allocations: SECTOR BREAKDOWN ------------------------------------------------------------- SECTOR FEBRUARY 28, 2003 ------------------------------------------------------------- Transportation 32% ------------------------------------------------------------- Education 23 ------------------------------------------------------------- Hospital 12 ------------------------------------------------------------- Tobacco 12 ------------------------------------------------------------- Tax Revenue 10 ------------------------------------------------------------- Water & Sewer 7 ------------------------------------------------------------- Lease Revenue 4 ------------------------------------------------------------- CREDIT BREAKDOWN* ------------------------------------------------------------- CREDIT RATING FEBRUARY 28, 2003 ------------------------------------------------------------- AAA/Aaa 81% ------------------------------------------------------------- AA/Aa 6 ------------------------------------------------------------- A 13 ------------------------------------------------------------- --------- * Using the higher of S&P's, Moody's or Fitch's rating. Percentages based on long-term investments. 17 TRUST SUMMARIES (unaudited) FEBRUARY 28, 2003 - --------------------------------------- BlackRock New York Municipal Bond Trust - --------------------------------------- TRUST INFORMATION - -------------------------------------------------------------------------------- Symbol on New York Stock Exchange: BQH - -------------------------------------------------------------------------------- Initial Offering Date: April 30, 2002 - -------------------------------------------------------------------------------- Closing Market Price as of 2/28/03: $13.38 - -------------------------------------------------------------------------------- Net Asset Value as of 2/28/03: $14.90 - -------------------------------------------------------------------------------- Yield on Closing Market Price as of 2/28/03 ($13.38):(1) 6.84% - -------------------------------------------------------------------------------- Current Monthly Distribution per Common Share:(2) $ 0.07625 - -------------------------------------------------------------------------------- Current Annualized Distribution per Common Share:(2) $ 0.91500 - -------------------------------------------------------------------------------- (1) Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. (2) The distribution is not constant and is subject to change. The table below summarizes the changes in the Trust's market price and NAV: --------------------------------------------------------------- 2/28/03 8/31/02 CHANGE HIGH LOW - -------------------------------------------------------------------------------- MARKET PRICE $13.38 $14.50 (7.72)% $15.00 $13.02 - -------------------------------------------------------------------------------- NAV $14.90 $14.83 0.47% $15.46 $14.43 - -------------------------------------------------------------------------------- The following charts show the Trust's asset composition and credit quality allocations: SECTOR BREAKDOWN - -------------------------------------------------------------------------------- SECTOR FEBRUARY 28, 2003 AUGUST 31, 2002 - -------------------------------------------------------------------------------- Transportation 14% 18% - -------------------------------------------------------------------------------- Tobacco 13 13 - -------------------------------------------------------------------------------- Lease Revenue 12 4 - -------------------------------------------------------------------------------- Education 12 12 - -------------------------------------------------------------------------------- Hospitals 11 7 - -------------------------------------------------------------------------------- City, County & State 10 10 - -------------------------------------------------------------------------------- Housing 9 13 - -------------------------------------------------------------------------------- Water & Sewer 8 8 - -------------------------------------------------------------------------------- Industrial & Pollution Control 4 -- - -------------------------------------------------------------------------------- Power 3 3 - -------------------------------------------------------------------------------- Tax Revenue -- 8 - -------------------------------------------------------------------------------- Other 4 4 - -------------------------------------------------------------------------------- CREDIT BREAKDOWN* - -------------------------------------------------------------------------------- CREDIT RATING FEBRUARY 28, 2003 AUGUST 31, 2002 - -------------------------------------------------------------------------------- AAA/Aaa 21% 21% - -------------------------------------------------------------------------------- AA/Aa 30 30 - -------------------------------------------------------------------------------- A 41 41 - -------------------------------------------------------------------------------- B 4 4 - -------------------------------------------------------------------------------- Not Rated 4 4 - -------------------------------------------------------------------------------- - ---------- * Using the higher of S&P's, Moody's or Fitch's rating. Percentages based on long-term investments. 18 TRUST SUMMARIES (unaudited) FEBRUARY 28, 2003 - -------------------------------------------- BlackRock New York Municipal Income Trust II - -------------------------------------------- TRUST INFORMATION - -------------------------------------------------------------------------------- Symbol on American Stock Exchange: BFY - -------------------------------------------------------------------------------- Initial Offering Date: July 30, 2002 - -------------------------------------------------------------------------------- Closing Market Price as of 2/28/03: $13.45 - -------------------------------------------------------------------------------- Net Asset Value as of 2/28/03: $14.30 - -------------------------------------------------------------------------------- Yield on Closing Market Price as of 2/28/03 ($13.45):(1) 7.03% - -------------------------------------------------------------------------------- Current Monthly Distribution per Common Share:(2) $ 0.07875 - -------------------------------------------------------------------------------- Current Annualized Distribution per Common Share:(2) $ 0.94500 - -------------------------------------------------------------------------------- (1) Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. (2) The distribution is not constant and is subject to change. The table below summarizes the changes in the Trust's market price and NAV: ------------------------------------------------------------- 2/28/03 8/31/02 CHANGE HIGH LOW - -------------------------------------------------------------------------------- MARKET PRICE $13.45 $15.10 (10.93)% $15.45 $12.95 - -------------------------------------------------------------------------------- NAV $14.30 $14.47 (1.17)% $14.74 $13.58 - -------------------------------------------------------------------------------- The following charts show the Trust's asset composition and credit quality allocations: SECTOR BREAKDOWN - -------------------------------------------------------------------------------- SECTOR FEBRUARY 28, 2003 AUGUST 31, 2002 - -------------------------------------------------------------------------------- Transportation 26% 38% - -------------------------------------------------------------------------------- Education 20 16 - -------------------------------------------------------------------------------- Tobacco 12 12 - -------------------------------------------------------------------------------- Water & Sewer 9 12 - -------------------------------------------------------------------------------- Tax Revenue 9 7 - -------------------------------------------------------------------------------- Industrial & Pollution Control 9 -- - -------------------------------------------------------------------------------- City, County & State 8 6 - -------------------------------------------------------------------------------- Hospitals 5 3 - -------------------------------------------------------------------------------- Power 1 3 - -------------------------------------------------------------------------------- Housing 1 3 - -------------------------------------------------------------------------------- CREDIT BREAKDOWN* - -------------------------------------------------------------------------------- CREDIT RATING FEBRUARY 28, 2003 AUGUST 31, 2002 - -------------------------------------------------------------------------------- AAA/Aaa 29% 33% - -------------------------------------------------------------------------------- AA/Aa 47 55 - -------------------------------------------------------------------------------- A 20 6 - -------------------------------------------------------------------------------- BBB/Baa 1 -- - -------------------------------------------------------------------------------- B 3 6 - -------------------------------------------------------------------------------- - ---------- * Using the higher of S&P's, Moody's or Fitch's rating. Percentages based on long-term investments. 19 TRUST SUMMARIES (unaudited) FEBRUARY 28, 2003 - --------------------------------------- BlackRock Virginia Municipal Bond Trust - --------------------------------------- TRUST INFORMATION - -------------------------------------------------------------------------------- Symbol on American Stock Exchange: BHV - -------------------------------------------------------------------------------- Initial Offering Date: April 30, 2002 - -------------------------------------------------------------------------------- Closing Market Price as of 2/28/03: $15.05 - -------------------------------------------------------------------------------- Net Asset Value as of 2/28/03: $15.28 - -------------------------------------------------------------------------------- Yield on Closing Market Price as of 2/28/03 ($15.05):(1) 5.63% - -------------------------------------------------------------------------------- Current Monthly Distribution per Common Share:(2) $ 0.070625 - -------------------------------------------------------------------------------- Current Annualized Distribution per Common Share:(2) $ 0.847500 - -------------------------------------------------------------------------------- (1) Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. (2) The distribution is not constant and is subject to change. The table below summarizes the changes in the Trust's market price and NAV: ---------------------------------------------------------------- 2/28/03 8/31/02 CHANGE HIGH LOW - -------------------------------------------------------------------------------- MARKET PRICE $15.05 $15.20 (0.99)% $15.70 $14.25 - -------------------------------------------------------------------------------- NAV $15.28 $14.90 2.55% $15.58 $14.36 - -------------------------------------------------------------------------------- The following charts show the Trust's asset composition and credit quality allocations: SECTOR BREAKDOWN - -------------------------------------------------------------------------------- SECTOR FEBRUARY 28, 2003 AUGUST 31, 2002 - -------------------------------------------------------------------------------- City, County & State 20% 19% - -------------------------------------------------------------------------------- Water & Sewer 19 19 - -------------------------------------------------------------------------------- Hospitals 17 13 - -------------------------------------------------------------------------------- Housing 15 11 - -------------------------------------------------------------------------------- Transportation 12 20 - -------------------------------------------------------------------------------- Education 5 4 - -------------------------------------------------------------------------------- Tobacco 4 -- - -------------------------------------------------------------------------------- Lease Revenue 4 10 - -------------------------------------------------------------------------------- Other 4 4 - -------------------------------------------------------------------------------- CREDIT BREAKDOWN* - -------------------------------------------------------------------------------- CREDIT RATING FEBRUARY 28, 2003 AUGUST 31, 2002 - -------------------------------------------------------------------------------- AAA/Aaa 47% 47% - -------------------------------------------------------------------------------- AA/Aa 20 24 - -------------------------------------------------------------------------------- A 21 22 - -------------------------------------------------------------------------------- Not Rated 12 7 - -------------------------------------------------------------------------------- - ---------- * Using the higher of S&P's, Moody's or Fitch's rating. Percentages based on long-term investments. 20 PORTFOLIO OF INVESTMENTS (unaudited) FEBRUARY 28, 2003 - ---------------------------------------- BlackRock Insured Municipal Income Trust - ----------------------------------------
PRINCIPAL AMOUNT OPTION CALL RATING* (000) DESCRIPTION PROVISIONS** VALUE - -------------------------------------------------------------------------------------------------------------------------------- LONG-TERM INVESTMENTS--157.5% ALABAMA--10.6% Jefferson Cnty. Swr. Rev., Ser. D, FGIC, AAA $20,000 5.00%, 2/01/38 ............................................................ 08/12 @ 100 $ 20,048,600 AAA 20,000 5.00%, 2/01/42 ............................................................ 08/12 @ 100 19,989,000 ------------ 40,037,600 ------------ CALIFORNIA--22.8% AAA 24,530 California, GO, 5.00%, 2/01/31, MBIA ........................................ 02/13 @ 100 24,804,245 A- 14,000 California Dept. of Wtr. Res., Pwr. Sply. Rev., Ser. A, 5.375%, 5/01/22 ..... 05/12 @ 101 14,509,740 Los Angeles Dept. of Wtr. & Pwr., Wtr. Wrks. Rev., Ser. A, AAA 11,810 5.125%, 7/01/40, FGIC ..................................................... 07/12 @ 100 12,035,689 AAA 12,850 5.125%, 7/01/41, MBIA ..................................................... 07/11 @ 100 13,072,691 San Joaquin Hills Transp. Corridor Agcy., Toll Road Rev., Ser. A, MBIA, AAA 53,000 Zero Coupon, 1/15/31 ...................................................... No Opt. Call 11,816,350 AAA 48,690 Zero Coupon, 1/15/32 ...................................................... No Opt. Call 10,257,035 ------------ 86,495,750 ------------ GEORGIA--9.1% Atlanta Wtr. & Wstwtr. Rev., Ser. A, AAA 9,555 5.00%, 11/01/38, FGIC ..................................................... 05/09 @ 101 9,657,334 AAA 14,145 5.00%, 11/01/39, MBIA ..................................................... 05/12 @ 100 14,313,043 A3 10,000 De Kalb Cnty. Dev. Auth., PCR, General Mtrs. Corp. Proj., 6.00%, 3/15/21 .... 12/12 @ 101 10,293,500 ------------ 34,263,877 ------------ ILLINOIS--12.2% AAA 7,300 Chicago, GO, Neighborhoods Alive 21 Prog., Ser. A, 5.00%, 1/01/41, FGIC ..... 01/11 @ 100 7,342,048 AAA 11,550 Chicago Spec. Transp. Rev., 5.25%, 1/01/31, AMBAC ........................... 01/11 @ 101 11,946,973 AAA 9,400 Chicago Wtr. Rev., 5.00%, 11/01/31, AMBAC ................................... 11/11 @ 100 9,506,220 Met. Pier & Exposition Auth., Dedicated St. Tax Rev., McCormick Place Expansion Proj., MBIA, AAA 10,000 Ser. A, Zero Coupon, 12/15/25 ............................................. No Opt. Call 2,965,100 AAA 5,000 Ser. A, Zero Coupon, 12/15/29 ............................................. No Opt. Call 1,175,450 AAA 25,000 Ser. A, Zero Coupon, 6/15/35 .............................................. No Opt. Call 4,334,750 AAA 5,000 Ser. A, 5.25%, 6/15/42 .................................................... 06/12 @ 101 5,141,500 AAA 15,000 Ser. B, Zero Coupon, 6/15/28 .............................................. No Opt. Call 3,834,300 ------------ 46,246,341 ------------ INDIANA--2.5% AAA 9,400 New Albany-Floyd Cnty. Sch. Bldg. Corp., 5.125%, 1/15/27, FGIC .............. 07/12 @ 100 9,637,256 ------------ MASSACHUSETTS--11.3% Massachusetts Tpke. Auth., Met. Hwy. Sys. Rev., Ser. A, AAA 16,735 5.00%, 1/01/37, MBIA ...................................................... 01/07 @ 102 16,771,650 AAA 26,000 5.00%, 1/01/39, AMBAC ..................................................... 01/09 @ 101 26,055,120 ------------ 42,826,770 ------------ MICHIGAN--1.4% AAA 5,000 Detroit City Sch. Dist., GO, Ser. A, 5.125%, 5/01/31, FSA ................... 05/12 @ 100 5,123,850 ------------ NEVADA--7.4% AAA 6,000 Reno Transp. Proj., 5.125%, 6/01/32, AMBAC .................................. 06/12 @ 100 6,136,200 Truckee Meadows Wtr. Auth., Ser. A, FSA, AAA 10,000 5.00%, 7/01/25 ............................................................ 07/11 @ 100 10,150,200 AAA 6,500 5.125%, 7/01/30 ........................................................... 07/11 @ 100 6,626,035 AAA 5,000 5.25%, 7/01/34 ............................................................ 07/11 @ 100 5,156,650 ------------ 28,069,085 ------------ NEW JERSEY--4.7% A+ 20,000 Tobacco Settlement Fin. Corp., 6.125%, 6/01/42 .............................. 06/12 @ 100 17,712,600 ------------
See Notes to Financial Statements. 21
PRINCIPAL AMOUNT OPTION CALL RATING* (000) DESCRIPTION PROVISIONS** VALUE - -------------------------------------------------------------------------------------------------------------------------------- NEW YORK--7.0% Met. Transp. Auth., Dedicated Tax Fund, Ser. A, AAA $10,000 5.00%, 11/15/30, MBIA ..................................................... 11/12 @ 100 $ 10,148,100 AAA 5,000 5.00%, 11/15/31, FGIC ..................................................... 11/11 @ 100 5,063,800 AAA 11,000 Triborough Brdg. & Tunl. Auth. Rev., Ser. E, 5.00%, 11/15/32, MBIA .......... 11/12 @ 100 11,137,390 ------------ 26,349,290 ------------ OHIO--0.7% BBB 2,500 Cuyahoga Cnty. Hosp. Facs. Rev., Canton Inc. Proj., 7.50%, 1/01/30 .......... 07/10 @ 101 2,765,275 ------------ PENNSYLVANIA--8.5% BBB+ 5,000 Lebanon Cnty. Hlth. Facs. Auth., Good Samaritan Hosp. Proj., 6.00%, 11/15/35 11/12 @ 101 5,042,050 AAA 5,000 Pennsylvania Tpke. Comm., 5.00%, 7/15/41, AMBAC ............................. 07/11 @ 101 5,058,050 Philadelphia Gas Wks., FSA, AAA 5,200 Ser. 3, 5.125%, 8/01/31 ................................................... 08/11 @ 100 5,319,860 AAA 16,625 Ser. 4, 5.00%, 8/01/32 .................................................... 08/13 @ 100 16,900,643 ------------ 32,320,603 ------------ RHODE ISLAND--5.2% A+ 21,495 Tobacco Settlement Fin. Corp., Ser. A, 6.25%, 6/01/42 ....................... 06/12 @ 100 19,852,782 ------------ SOUTH CAROLINA--13.4% AAA 5,000 So. Carolina Pub. Svc. Auth., Ser. B, 5.50%, 1/01/36, FSA ................... 01/12 @ 100 5,309,250 So. Carolina Transp. Infrastructure Bank, AMBAC, AAA 9,000 Ser. A, 5.00%, 10/01/29 ................................................... 10/11 @ 100 9,202,680 AAA 22,750 Ser. A, 5.00%, 10/01/33 ................................................... 10/12 @ 100 23,206,820 AAA 12,660 Ser. B, 5.125%, 10/01/26 .................................................. 10/11 @ 100 13,092,086 ------------ 50,810,836 ------------ SOUTH DAKOTA--1.1% A1 4,165 Edl. Enhancement Fdg. Corp., Tobacco Settlement Rev., Ser. B, 6.50%, 6/01/32 06/12 @ 101 4,063,457 ------------ TENNESSEE--3.5% Knox Cnty. Hlth. Edl. & Hsg. Facs. Brd., Hosp. Facs. Rev., Ser. A, FSA, AAA 11,705 Zero Coupon, 1/01/22 ...................................................... 01/13 @ 59.566 4,100,847 AAA 9,260 Zero Coupon, 1/01/23 ...................................................... 01/13 @ 56.016 3,026,909 AAA 8,500 Zero Coupon, 1/01/24 ...................................................... 01/13 @ 52.749 2,605,760 AAA 6,850 Zero Coupon, 1/01/25 ...................................................... 01/13 @ 49.712 1,978,485 AAA 5,000 Zero Coupon, 1/01/26 ...................................................... 01/13 @ 46.781 1,356,050 ------------ 13,068,051 ------------ TEXAS--20.2% BBB+ 3,700 Comal Cnty. Hlth. Facs., Hlth. Care Sys., McKenna Mem. Proj., Ser. A, 6.25%, 2/01/32 ................................................................... 02/13 @ 100 3,709,472 Harris Cnty., AAA 7,485 GO, Zero Coupon, 8/15/25, MBIA ............................................ No Opt. Call 2,329,781 AAA 10,915 GO, Zero Coupon, 8/15/28, MBIA ............................................ No Opt. Call 2,841,830 AAA 5,510 Toll Road Rev., 5.00%, 8/15/30, FSA ....................................... 08/12 @ 100 5,569,122 Harris Cnty. Houston Sports Auth., Ser. H, MBIA, AAA 5,785 Zero Coupon, 11/15/38 ..................................................... 11/31 @ 64.91 832,172 AAA 6,160 Zero Coupon, 11/15/39 ..................................................... 11/31 @ 60.976 831,908 AAA 25,000 Houston Wtr. & Swr. Sys. Rev., Ser. A, 5.00%, 12/01/30, FSA ................. 12/12 @ 100 25,274,500 AAA 32,000 Texas Tpke. Auth., Central Sys. Rev., Ser. A, 5.00%, 8/15/42, AMBAC ......... 08/12 @ 100 32,102,720 BBB+ 3,000 Tyler Cnty. Hlth. Facs. Dev., Mother Frances Hosp., 6.00%, 7/01/31 .......... 07/12 @ 100 3,011,340 ------------ 76,502,845 ------------ VIRGINIA--1.9% Chesterfield Cnty. Indl. Dev. Auth., PCR, Elec. & Pwr. Co., A3 3,000 Ser. A, 5.875%, 6/01/17 ................................................... 11/10 @ 102 3,159,510 A3 4,000 Ser. B, 5.875%, 6/01/17 ................................................... 11/10 @ 102 4,212,680 ------------ 7,372,190 ------------
See Notes to Financial Statements. 22
PRINCIPAL AMOUNT OPTION CALL RATING* (000) DESCRIPTION PROVISIONS** VALUE - -------------------------------------------------------------------------------------------------------------------------------- WASHINGTON--14.0% AAA $ 3,655 Chelan Cnty. Pub. Util. Dist. 1, Chelan Hydro Sys., Ser. C, 5.125%, 7/01/33, AMBAC ..................................................................... 07/12 @ 100 $ 3,727,588 AAA 6,450 King Cnty. Swr. Rev., 5.00%, 1/01/31, FGIC .................................. 01/12 @ 100 6,514,887 AAA 9,500 Seattle, GO, Ser. F, 5.125%, 12/15/28, MBIA ................................. 12/08 @ 100 9,636,800 A1 18,150 Tobacco Settlement Auth., 6.625%, 6/01/32 ................................... 06/13 @ 100 17,656,502 Washington, GO, FSA, AAA 6,380 Ser. A, 5.00%, 7/01/25 .................................................... 07/11 @ 100 6,449,542 AAA 9,000 Ser. B, 5.00%, 1/01/27 .................................................... 01/12 @ 100 9,077,670 ------------ 53,062,989 ------------ TOTAL LONG-TERM INVESTMENTS (COST $589,175,699) ............................. 596,581,447 ------------ MONEY MARKET FUND--1.6% NR 6,000 AIM Tax Free Investment Co. Cash Reserve Portfolio (cost $6,000,000) ........ N/A 6,000,000 ------------ TOTAL INVESTMENTS--159.1% (COST $595,175,699) ............................... 602,581,447 Other assets in excess of liabilities--1.4% ................................. 5,145,544 Preferred shares at redemption value, including dividends payable--(60.5)% .. (228,997,880) ------------ NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS--100% .......................... $378,729,111 ============
- ---------- * Using the higher of S&P's, Moody's or Fitch's rating. ** Date (month/year) and price of the earliest call or redemption. There may be other call provisions at varying prices at later dates. - ---------------------------------------------------------------- KEY TO ABBREVIATIONS AMBAC -- American Municipal Bond Assurance Corporation FGIC -- Financial Guaranty Insurance Company FSA -- Financial Security Assurance GO -- General Obligation MBIA -- Municipal Bond Insurance Association PCR -- Pollution Control Revenue - ---------------------------------------------------------------- See Notes to Financial Statements. 23 PORTFOLIO OF INVESTMENTS (unaudited) FEBRUARY 28, 2003 - ------------------------------ BlackRock Municipal Bond Trust - ------------------------------
PRINCIPAL AMOUNT OPTION CALL RATING* (000) DESCRIPTION PROVISIONS** VALUE - -------------------------------------------------------------------------------------------------------------------------------- LONG-TERM INVESTMENTS--156.4% ALABAMA--11.5% BBB $ 9,250 Courtland Ind. Dev. Brd., PCR, Champion Intl. Corp. Proj., Ser. A, 6.50%, 9/01/25 ................................................................... 09/05 @ 102 $ 9,553,215 A2 7,500 Huntsville Hlth. Care Auth., Ser. A, 5.75%, 6/01/31 ......................... 06/11 @ 101 7,636,725 ------------ 17,189,940 ------------ ALASKA--6.8% AA+ 10,000 Valdez Marine Term., BP Pipelines Inc. Proj., Ser. A, 5.85%, 8/01/25 ........ 08/03 @ 102 10,241,000 ------------ CALIFORNIA--7.6% A+ 5,505 Golden St. Tobacco Sec. Corp., Tobacco Settlement Rev., Ser. A-1, 6.75%, 6/01/39 ................................................................... 06/13 @ 100 5,431,233 B- 8,000 Los Angeles Regl. Arpt. Impvt., Corp. Lease Rev., Amer. Airlines Inc., Ser. B, 7.50%, 12/01/24 ................................................... 12/12 @ 102 5,886,160 ------------ 11,317,393 ------------ CONNECTICUT--7.0% Connecticut Dev. Auth., Connecticut Lt. & Pwr., PCR, A3 6,500 Ser. A, 5.85%, 9/01/28 .................................................... 10/08 @ 102 6,812,325 A3 3,500 Ser. B, 5.95%, 9/01/28 .................................................... 10/08 @ 102 3,638,110 ------------ 10,450,435 ------------ DELAWARE--7.3% NR 10,500+ Charter Mac Equity Issuer Trust, Ser. B-2, 7.20%, 10/31/52 .................. 10/14 @ 100 10,996,755 ------------ DISTRICT OF COLUMBIA--7.1% AAA 33,450 Dist. of Columbia Rev., Georgetown Univ., Ser. A, Zero Coupon, 4/01/38, MBIA 04/11 @ 20.243 4,308,026 AAA 6,000 Dist. of Columbia Tax Incr. Rev., Gallery Place Proj., 5.40%, 7/01/31, FSA .. 07/12 @ 100 6,306,180 ------------ 10,614,206 ------------ FLORIDA--16.0% BBB- 6,200 Martin Cnty. Indl. Dev. Auth., Indiantown Cogeneration Proj., Ser. A, 7.875%, 12/15/25 .................................................................. 12/04 @ 102 6,457,052 A- 10,000 Orange Cnty. Hlth. Facs. Auth., Hosp. Adventist Hlth. Sys., 5.625%, 11/15/32 11/12 @ 101 10,158,600 AAA 7,255 Palm Beach Cnty. Hsg. Fin. Auth., Mult. Fam. Rev., Indian Trace Apts., Ser. A, 5.625%, 1/01/44, FSA .............................................. 01/12 @ 100 7,418,818 ------------ 24,034,470 ------------ ILLINOIS--20.5% AAA 23,065 Bolingbrook, GO, Ser. B, Zero Coupon, 1/01/36, FGIC ......................... 01/12 @ 23.018 3,316,516 AAA 9,880 Chicago, GO, Ser. A, 5.50%, 1/01/38, MBIA ................................... 01/11 @ 101 10,469,046 BBB 6,000 Illinois Edl. Facs. Auth., Student Hsg. Rev., Edl. Advancement Fund Univ. Ctr. Proj., 6.25%, 5/01/34 ................................................ 05/07 @ 100 6,047,280 A- 6,000 Illinois Hlth. Facs. Auth., Lake Forest Hosp., Ser. A, 5.75%, 7/01/29 ....... 07/12 @ 100 6,101,520 Met. Pier & Exposition Auth., Dedicated St. Tax Rev., McCormick Place Expansion Proj., Ser. A, MBIA, AAA 10,000 Zero Coupon, 6/15/35 ...................................................... No Opt. Call 1,733,900 AAA 10,000 Zero Coupon, 12/15/36 ..................................................... No Opt. Call 1,592,600 AAA 10,000 Zero Coupon, 12/15/37 ..................................................... No Opt. Call 1,502,800 ------------ 30,763,662 ------------ INDIANA--1.4% NR 2,020 Mult. Fam. Hsg. Rev., Canterbury House Apts., Ser. 1, 5.90%, 12/01/34 ....... 12/11 @ 100 2,038,988 ------------ KANSAS--3.5% A 5,000 Wichita Arpt. Auth., Arpt. Facs. Rev., Cessna Citation Svc. Ctr., Ser. A, 6.25%, 6/15/32 ............................................................ 06/12 @ 101 5,218,450 ------------ LOUISIANA--4.0% A- 6,000 Louisiana Pub. Facs. Auth., Ochsner Clinic Fndtn. Proj., Ser. B, 5.50%, 5/15/32 ................................................................... 05/12 @ 101 6,031,020 ------------ MASSACHUSETTS--5.0% AAA 7,500 Massachusetts Tpke. Auth., Met. Hwy. Sys. Rev., Ser. A, 5.00%, 1/01/37, MBIA 01/07 @ 102 7,516,425 ------------ MICHIGAN--3.0% BBB 4,500 Delta Cnty. Econ. Dev. Corp., Environ. Impvt. Rev., Mead Westvaco Escanaba, Ser. A, 6.25%, 4/15/27 .................................................... 04/12 @ 100 4,553,865 ------------ NEW JERSEY--6.9% New Jersey Econ. Dev. Auth., B+ 3,000 Continental Airlines Inc. Proj., 7.20%, 11/15/30 .......................... 11/10 @ 101 2,182,890 Baa3 7,500 Kapkowski Road Landfill Proj., 6.50%, 4/01/28 ............................. No Opt. Call 8,222,925 ------------ 10,405,815 ------------
See Notes to Financial Statements. 24
PRINCIPAL AMOUNT OPTION CALL RATING* (000) DESCRIPTION PROVISIONS** VALUE - -------------------------------------------------------------------------------------------------------------------------------- OREGON--0.7% NR $ 1,000 Mult. Fam. Hsg. Rev., Pacific Tower Apts., Ser. 6, 6.05%, 11/01/34 .......... 06/12 @ 100 $ 1,008,330 ------------ RHODE ISLAND--6.2% A+ 10,000 Tobacco Settlement Fin. Corp., Ser. A, 6.25%, 6/01/42 ....................... 06/12 @ 100 9,236,000 ------------ SOUTH CAROLINA--9.8% A- 5,000 So. Carolina Jobs Econ. Dev. Auth., Hosp. Facs. Rev., Bon Secours Hlth. Sys. Inc., Ser. A, 5.625%, 11/15/30 .................................................. 11/12 @ 100 5,044,750 A+ 10,000 Tobacco Settlement Rev. Mgmt. Auth., Ser. B, 6.375%, 5/15/28 ................ 05/11 @ 101 9,628,700 ------------ 14,673,450 ------------ TEXAS--20.3% AAA 11,690 Harris Cnty. Houston Sports Auth., Ser. G, Zero Coupon, 11/15/41, MBIA ...... 11/31 @ 53.779 1,355,806 NR 2,840 Mult. Fam. Hsg. Rev., Copperwood Ranch Apts., Ser. 9, 5.95%, 11/01/35 ....... 06/12 @ 100 2,865,787 BBB 10,000 Red River Auth., PCR, Celanese Proj., Ser. B, 6.70%, 11/01/30 ............... 05/12 @ 101 10,438,600 AAA 60,000 Texas Tpke. Auth., Central Sys. Rev., Zero Coupon, 8/15/35, AMBAC ........... 08/12 @ 25.665 8,892,000 BBB+ 6,840 Tyler Cnty. Hlth. Facs. Dev., Mother Frances Hosp., 6.00%, 7/01/31 .......... 07/12 @ 100 6,865,856 ------------ 30,418,049 ------------ VIRGINIA--3.4% A 5,000 Arlington Cnty. Ind. Dev. Auth., Hosp. Fac. Rev., Virginia Hosp. Ctr. Arlington Hlth. Sys., 5.25%, 7/01/31 ............................................................ 07/11 @ 101 5,038,750 ------------ WEST VIRGINIA--2.1% AAA 20,255 West Virginia Hsg. Dev. Fund, Hsg. Fin. Rev., Zero Coupon, 11/01/37 ......... No Opt. Call 3,110,560 ------------ WISCONSIN--6.3% A+ 2,395 Badger Tobacco Asset Sec. Corp., 6.375%, 6/01/32 ............................ 06/12 @ 100 2,263,179 A 7,000 Wisconsin Hlth. & Edl. Facs. Auth., Wheaton Franciscan Svcs., 5.75%, 8/15/30 02/12 @ 101 7,141,820 ------------ 9,404,999 ------------ TOTAL LONG-TERM INVESTMENTS (COST $228,788,913) ............................. 234,262,562 ------------ SHORT-TERM INVESTMENTS--2.0% PENNSYLVANIA--0.0% A2 75 Harrisburg Auth., 1.13%, 3/06/03, FRWD+ ..................................... N/A 75,000 ------------ MONEY MARKET FUND--2.0% NR 3,000 AIM Tax Free Investment Co. Cash Reserve Portfolio .......................... N/A 3,000,000 ------------ TOTAL SHORT-TERM INVESTMENTS (COST $3,075,000) .............................. 3,075,000 TOTAL INVESTMENTS--158.4% (COST $231,863,913) ............................... 237,337,562 Other assets in excess of liabilities--2.0% ................................. 2,957,087 Preferred shares at redemption value, including dividends payable--(60.4)% .. (90,504,768) ------------ NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS--100% .......................... $149,789,881 ============
- ---------- * Using the higher of S&P's, Moody's or Fitch's rating. ** Date (month/year) and price of the earliest call or redemption. There may be other call provisions at varying prices at later dates. + For purposes of amortized cost valuation, the maturity date of this instrument is considered to be the earlier 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. - -------------------------------------------------------------- KEY TO ABBREVIATIONS AMBAC -- American Municipal Bond Assurance Corporation FGIC -- Financial Guaranty Insurance Company FRWD -- Floating Rate Weekly Demand FSA -- Financial Security Assurance GO -- General Obligation MBIA -- Municipal Bond Insurance Association PCR -- Pollution Control Revenue - -------------------------------------------------------------- See Notes to Financial Statements. 25 PORTFOLIO OF INVESTMENTS (unaudited) FEBRUARY 28, 2003 - ----------------------------------- BlackRock Municipal Income Trust II - -----------------------------------
PRINCIPAL AMOUNT OPTION CALL RATING* (000) DESCRIPTION PROVISIONS** VALUE - -------------------------------------------------------------------------------------------------------------------------------- LONG-TERM INVESTMENTS--157.6% ALABAMA--2.8% AAA $ 9,000 Birmingham Wtr. Wks. & Swr. Brd., Wtr. & Swr. Rev., Ser. B, 5.00%, 1/01/43, MBIA ...................................................................... 01/13 @ 100 $ 9,015,840 ------------ CALIFORNIA--7.4% A- 5,000 California Statewide Cmnty. Dev. Auth., Mem. Hlth. Svcs., Ser. A, 5.50%, 10/01/33 .................................................................. 04/13 @ 100 5,021,850 A+ 4,000 Golden St. Tobacco Sec. Corp., Tobacco Settlement Rev., Ser. A-1, 6.75%, 6/01/39 ................................................................... 06/13 @ 100 3,946,400 B- 13,500 Los Angeles Regl. Arpt. Impvt. Corp. Lease Rev., Amer. Airlines Inc., Ser. C, 7.50%, 12/01/24 ........................................................... 12/12 @ 102 9,932,895 NR 4,620 San Francisco City & Cnty. Redev. Agcy., Cmnty. Facs. Dist., Mission Bay South, 6.625%, 8/01/27 ........................................................... 08/11 @ 101 4,818,152 ------------ 23,719,297 ------------ COLORADO--4.4% AA 10,000 Colorado Hlth. Facs. Auth., Catholic Hlth. Initiatives, Ser. A, 5.50%, 3/01/32 09/12 @ 100 10,122,600 AAA 4,000 Northwest Pkwy. Pub. Hwy. Auth. Rev., Ser. A, 5.25%, 6/15/41, FSA ........... 06/11 @ 102 4,139,400 ------------ 14,262,000 ------------ CONNECTICUT--1.6% A3 5,000 Connecticut Dev. Auth., Connecticut Lt. & Pwr., PCR, Ser. B, 5.95%, 9/01/28 . 10/08 @ 102 5,197,300 ------------ DISTRICT OF COLUMBIA--4.6% A+ 15,000 Dist. of Columbia Tobacco Settlement Fin. Corp., 6.75%, 5/15/40 ............. 05/11 @ 101 14,718,750 ------------ FLORIDA--7.3% A 2,650 Leesburg Hosp. Rev., Leesburg Regl. Med Ctr. Proj., 5.50%, 7/01/32 .......... 07/12 @ 100 2,652,730 A- 6,850 Orange Cnty. Hlth. Facs. Auth., Hosp. Adventist Hlth. Sys., 5.625%, 11/15/32 11/12 @ 101 6,958,641 AA- 14,000 Pinellas Cnty. Hlth. Fac. Auth., Baycare Hlth. Sys., 5.50%, 11/15/33 ........ 05/13 @ 100 13,985,440 ------------ 23,596,811 ------------ GEORGIA--1.6% AAA 5,045 Atlanta Wtr. & Wstwtr. Rev., Ser. A, 5.00%, 11/01/33, MBIA .................. 05/12 @ 100 5,131,118 ------------ ILLINOIS--17.0% AAA 4,000 Bolingbrook, GO, Ser. A, 5.375%, 1/01/38, FGIC .............................. 01/12 @ 100 4,173,200 A- 7,500 Illinois Dev. Fin. Auth., Adventist Hlth. Sys. Sunbelt Oblig., 5.65%, 11/15/24 11/09 @ 101 7,593,750 A2 8,000 Illinois Hlth. Facs. Auth., Elmhurst Mem. Hlth. Care, 5.50%, 1/01/22 ........ 01/13 @ 100 8,051,840 AAA 15,000 Illinois Sports Facs. Auth., Dedicated St. Tax Supported Rev., Zero Coupon, 6/15/30, AMBAC ............................................................ 06/15 @ 101 10,456,200 Met. Pier & Exposition Auth., Dedicated St. Tax Rev., McCormick Place Expansion Proj., Ser. A, MBIA, AAA 45,190 Zero Coupon, 6/15/33 ...................................................... No Opt. Call 8,736,583 AAA 5,000 Zero Coupon, 6/15/40 ...................................................... No Opt. Call 652,900 AAA 14,500 5.25%, 6/15/42 ............................................................ 06/12 @ 101 14,910,350 ------------ 54,574,823 ------------ INDIANA--9.7% A3 5,500 Fort Wayne, PCR, Gen. Mtrs. Corp. Proj., 6.20%, 10/15/25 .................... 12/12 @ 101 5,758,390 AA 5,000 Indiana Hlth. Fac. Fin. Auth., Ascension Hlth., Ser. F, 5.375%, 11/15/25 .... 11/12 @ 101 5,050,000 AAA 19,735 Indianapolis Local Pub. Impvt. Bond Bank, Wtr. Wks. Proj., Ser. A, 5.25%, 7/01/33, MBIA ............................................................. 07/12 @ 100 20,475,457 ------------ 31,283,847 ------------ LOUISIANA--7.5% A- 24,000 Louisiana Pub. Facs. Auth., Ochsner Clinic Fndtn. Proj., Ser. B, 5.50%, 5/15/32 ................................................................... 05/12 @ 101 24,124,080 ------------ MARYLAND--1.9% Baa3 5,000 Maryland Econ. Dev. Corp., Student Hsg. Rev., Univ. of Maryland, Ser. A, 5.75%, 10/1/33 ................................................................... 10/13 @ 100 4,973,350 A3 1,000 Maryland Hlth. & Higher Edl. Facs. Auth., Union Hosp. of Cecil Cnty., 5.625%, 7/01/32 ................................................................... 07/12 @ 100 1,022,560 ------------ 5,995,910 ------------ MASSACHUSETTS--4.7% AAA 15,000 Massachusetts Tpke. Auth., Met. Hwy. Sys. Rev., Ser. A, 5.00%, 1/01/39, AMBAC ..................................................................... 01/09 @ 101 15,031,800 ------------ MICHIGAN--3.1% AA 10,000 Michigan Hosp. Fin. Auth., Ascension Hlth., Ser. B, 5.25%, 11/15/26 ......... 11/12 @ 101 10,047,500 ------------ MISSISSIPPI--1.8% BBB 4,950 Lowndes Cnty. Sld. Wst. Disp., PCR, Weyerhaeuser Co. Proj., Ser. A, 6.80%, 4/01/22 ................................................................... No Opt. Call 5,666,117 ------------ MISSOURI--1.9% NR 6,000 Dept. of Transp., Rt. 370/Missouri Bottom Rd./Taussig Rd. Transp. Dev., 7.20%, 5/01/33 ................................................................... 05/13 @ 100 6,087,840 ------------
See Notes to Financial Statements. 26
PRINCIPAL AMOUNT OPTION CALL RATING* (000) DESCRIPTION PROVISIONS** VALUE - -------------------------------------------------------------------------------------------------------------------------------- NEVADA--3.8% No. Las Vegas Local Impvt., Spec. Impvt. Dist. 60 Aliante, NR $ 2,500 6.125%, 12/01/17 .......................................................... 06/03 @ 103 $ 2,517,050 NR 3,000 6.40%, 12/01/22 ........................................................... 06/03 @ 103 3,020,010 AAA 6,500 Truckee Meadows Wtr. Auth., Ser. A, 5.125%, 7/01/30, FSA .................... 07/11 @ 100 6,626,035 ------------ 12,163,095 ------------ NEW JERSEY--10.5% New Jersey Econ. Dev. Auth., B+ 10,100 Continental Airlines Inc. Proj., 7.20%, 11/15/30 .......................... 11/10 @ 101 7,349,063 Baa3 7,475 Kapkowski Road Landfill Proj., 6.50%, 4/01/28 ............................. No Opt. Call 8,195,515 Baa3 10,000 Kapkowski Road Landfill Proj., 6.50%, 4/01/31 ............................. No Opt. Call 10,963,900 A+ 7,500 Tobacco Settlement Fin. Corp., 6.75%, 6/01/39 ............................... 06/13 @ 100 7,282,200 ------------ 33,790,678 ------------ NEW MEXICO--1.5% Baa1 5,200 New Mexico Hsg. Auth. Region III, Villa Delaware Oso Apts. Proj., Ser. A, 6.00%, 1/01/38 ............................................................ 01/13 @ 102 4,980,404 ------------ NEW YORK--4.3% A+ 5,250 New York City, GO, Ser. I, 5.00%, 3/01/33 ................................... 03/13 @ 100 5,092,553 B3 8,800 Port Auth. of NY & NJ, Spec. Oblig. Rev., Cont'l/Eastern Proj. LaGuardia, 9.00%, 12/01/10 ........................................................... 04/03 @ 100 8,848,400 ------------ 13,940,953 ------------ NORTH CAROLINA--1.9% AAA 8,250 No. Carolina Pub. Impvt., Ser. A, 3.00%, 3/01/28 ............................ 03/13 @ 100 6,062,348 ------------ RHODE ISLAND--4.8% A+ 16,620 Tobacco Settlement Fin. Corp., Ser. A, 6.25%, 6/01/42 ....................... 06/12 @ 100 15,350,232 ------------ SOUTH CAROLINA--10.4% Greenwood Cnty. Hosp. Rev., Self Mem. Hosp. Facs., A+ 3,280 5.50%, 10/01/26 ........................................................... 10/11 @ 100 3,300,631 A+ 3,250 5.50%, 10/01/31 ........................................................... 10/11 @ 100 3,254,940 So. Carolina Jobs Econ. Dev. Auth., Hosp. Facs. Rev., A- 10,000 Bon Secours Hlth. Sys. Inc., Ser. A, 5.625%, 11/15/30 ..................... 11/12 @ 100 10,089,500 AA 3,750 Georgetown Mem. Hosp., 5.375%, 2/01/30, RAA ............................... 08/11 @ 100 3,835,500 A+ 13,445 Tobacco Settlement Rev. Mgmt. Auth., Ser. B, 6.375%, 5/15/30 ................ No Opt. Call 12,964,341 ------------ 33,444,912 ------------ SOUTH DAKOTA--3.0% A1 10,000 Edl. Enhancement Fdg. Corp., Tobacco Settlement Rev., Ser. B, 6.50%, 6/01/32 06/12 @ 101 9,756,200 ------------ TENNESSEE--2.4% AAA 20,405 Knox Cnty. Hlth. Edl. & Hsg. Facs. Brd., Hosp. Facs. Rev., Ser. A, Zero Coupon, 1/01/21, FSA ...................................................... 01/13 @ 63.44 7,674,116 ------------ TEXAS--19.7% A- 13,000 Brazos Cnty. Hlth. Fac. Dev. Corp., Franciscan Svcs. Corp. Rev., 5.375%, 1/01/32 ................................................................... 01/13 @ 101 12,696,060 A- 1,750 Crawford Ed. Facs. Corp., Higher Ed. Rev., Univ. St. Thomas Proj., 5.375%, 10/01/27 .................................................................. 10/12 @ 100 1,720,757 BBB 20,000 Gulf Coast Wst. Disp. Auth., Environ. Impvt. Rev., Ser. A, 6.10%, 8/01/24 ... 08/12 @ 100 20,019,600 Texas Tpke. Auth., Central Sys. Rev., AMBAC, AAA 73,370 Zero Coupon, 8/15/36 ...................................................... 08/12 @ 24.171 10,235,115 AAA 65,000 Zero Coupon, 8/15/37 ...................................................... 08/12 @ 22.708 8,505,900 AAA 27,600 Zero Coupon, 8/15/38 ...................................................... 08/12 @ 21.384 3,391,488 AAA 6,700 Ser. A, 5.00%, 8/15/42 .................................................... 08/12 @ 100 6,721,507 ------------ 63,290,427 ------------ UTAH--2.8% BBB 9,000 Tooele Cnty. Hazardous Wst. Treatment, Union Pacific Proj., Ser. A, 5.70%, 11/01/26 .................................................................. 04/08 @ 102 8,884,530 ------------ VIRGINIA--8.7% NR 13,500 Alexandria Redev. & Hsg. Auth., 3001 Park Center Apts., Ser. A, 6.375%, 4/01/34 ................................................................... 04/08 @ 103 13,310,595 A 5,000 Arlington Cnty. Ind. Dev. Auth., Hosp. Fac. Rev., Virginia Hosp. Ctr. Arlington Hlth. Sys., 5.25%, 7/01/25 ................................................ 07/11 @ 101 5,070,850 AAA 9,000 Halifax Cnty. Indl. Dev. Auth., Exempt Fac. Rev., Old Dominion Elec. Coop. Proj., 5.625%, 6/01/28, AMBAC .................................................... 06/13 @ 101 9,498,870 ------------ 27,880,315 ------------
See Notes to Financial Statements. 27
PRINCIPAL AMOUNT OPTION CALL RATING* (000) DESCRIPTION PROVISIONS** VALUE - -------------------------------------------------------------------------------------------------------------------------------- WISCONSIN--6.5% A+ $12,600 Badger Tobacco Asset Sec. Corp., 6.375%, 6/01/32 ............................ 06/12 @ 100 $ 11,906,496 Wisconsin Hlth. & Edl. Facs. Auth., A- 4,000 Synergy Hlth. Inc., 6.00%, 11/15/32 ....................................... 08/13 @ 100 4,033,640 A 5,000 Wheaton Franciscan Svcs., 5.75%, 8/15/25 .................................. 02/12 @ 101 5,136,100 ------------ 21,076,236 ------------ TOTAL LONG-TERM INVESTMENTS (COST $504,493,182) ............................. 506,747,479 ------------ SHORT-TERM INVESTMENTS--7.3% ALABAMA--0.4% A1+ 1,400 Jefferson Cnty., GO, Ser. B, 1.18%, 3/03/03, FRDD+ .......................... N/A 1,400,000 ------------ CALIFORNIA--0.0% A1 75 California Hlth. Facs. Fin. Auth., Insured Scripps Hlth., Ser. B, Zero Coupon, 3/05/03, MBIA, FRWD+ ...................................................... N/A 75,000 ------------ FLORIDA--1.8% VMIG1 5,800 Orange Cnty. Florida Sch. Brd., COP, Ser. B-1, 1.15%, 3/03/03, AMBAC, FRDD+ . N/A 5,800,000 ------------ NEW YORK--2.0% A1+ 1,300 New York City Mun. Wtr. Fin. Auth., Ser. G, 1.10%, 3/03/03, FGIC, FRDD+ ..... N/A 1,300,000 A1+ 5,000 New York City Transl. Fin. Auth. Rev., Ser. A-1, 1.05%, 3/05/03, FRWD+ ...... N/A 5,000,000 ------------ 6,300,000 ------------ MONEY MARKET FUND--3.1% NR 10,000 AIM Tax Free Investment Co. Cash Reserve Portfolio .......................... N/A 10,000,000 ------------ TOTAL SHORT-TERM INVESTMENTS (COST $23,575,000) ............................. 23,575,000 TOTAL INVESTMENTS--164.9% (COST $528,068,182) ............................... 530,322,479 Liabilities in excess of other assets--(1.0)% ............................... (3,083,311) Preferred shares at redemption value, including dividends payable--(63.9)% .. (205,564,229) ------------ NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS--100% .......................... $321,674,939 ============
- ---------- * Using the higher of S&P's, Moody's or Fitch's rating. ** Date (month/year) and price of the earliest call or redemption. There may be other call provisions at varying prices at later dates. + For purposes of amortized cost valuation, the maturity date of this instrument is considered to be the earlier 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. - ------------------------------------------------------------- KEY TO ABBREVIATIONS AMBAC -- American Municipal Bond Assurance Corporation COP -- Certificate of Participation FGIC -- Financial Guaranty Insurance Company FRDD -- Floating Rate Daily Demand FRWD -- Floating Rate Weekly Demand FSA -- Financial Security Assurance GO -- General Obligation MBIA -- Municipal Bond Insurance Association PCR -- Pollution Control Revenue RAA -- Radian Asset Assurance - ------------------------------------------------------------- See Notes to Financial Statements. 28 PORTFOLIO OF INVESTMENTS (unaudited) FEBRUARY 28, 2003 - --------------------------------------------------- BlackRock California Insured Municipal Income Trust - ---------------------------------------------------
PRINCIPAL AMOUNT OPTION CALL RATING* (000) DESCRIPTION PROVISIONS** VALUE - -------------------------------------------------------------------------------------------------------------------------------- LONG-TERM INVESTMENTS--157.8% AAA $ 6,500 Benicia Unified Sch. District., Ser. B, Zero Coupon, 8/01/23, MBIA .......... No Opt. Call $ 2,266,680 California Cnty., Tobacco Sec. Agcy. Rev., A+ 7,650 Alameda Cnty., 6.00%, 6/01/42 ............................................. 06/12 @ 100 6,881,098 A+ 7,405 Sonoma Cnty., 5.875%, 6/01/43 ............................................. 06/12 @ 100 6,509,143 A- 6,500 California Dept. of Wtr. Res., Pwr. Sply. Rev., Ser. A, 5.25%, 5/01/20 ...... 05/12 @ 101 6,740,305 AAA 2,385 California Edl. Facs. Auth., Scripps College, 5.00%, 8/01/31, MBIA .......... 08/11 @ 100 2,424,496 AAA 4,500 California Infrastructure & Econ. Dev., Rand Corp., Ser. A, 5.25%, 4/01/42, AMBAC ..................................................................... 04/12 @ 100 4,675,320 AAA 5,000 California Pub. Wks. Brd., Dept. of Gen. Svcs., Ser. A, 5.00%, 12/01/27, AMBAC ..................................................................... 12/12 @ 100 5,089,950 Ceres Unified Sch. Dist., Ser. B, FGIC, AAA 3,055 Zero Coupon, 8/01/30 ...................................................... 08/12 @ 34.887 649,951 AAA 3,180 Zero Coupon, 8/01/31 ...................................................... 08/12 @ 32.868 639,816 AAA 3,300 Zero Coupon, 8/01/32 ...................................................... 08/12 @ 30.966 626,703 AAA 3,440 Zero Coupon, 8/01/33 ...................................................... 08/12 @ 29.174 612,699 AAA 3,575 Zero Coupon, 8/01/34 ...................................................... 08/12 @ 27.782 603,746 AAA 3,275 Zero Coupon, 8/01/35 ...................................................... 08/12 @ 26.186 522,035 AAA 2,000 Long Beach Unified Sch. Dist., Ser. D, 5.00%, 8/01/31, FSA .................. 08/10 @ 101 2,033,120 Los Angeles Dept. of Wtr. & Pwr., Wtr. Wks. Rev., Ser. A, FGIC, AAA 5,000 5.00%, 7/01/43 ............................................................ 07/12 @ 100 5,030,450 AAA 5,000 5.125%, 7/01/41 ........................................................... 07/11 @ 100 5,086,650 AAA 5,000 Los Angeles Unified Sch. Dist., Ser. E, 5.125%, 1/01/27, MBIA ............... 07/12 @ 100 5,171,400 Los Angeles Wstwtr. Sys. Rev., Ser. A, AAA 5,000 5.00%, 6/01/27, MBIA ...................................................... 06/13 @ 100 5,093,800 AAA 6,025 5.00%, 6/01/32, FGIC ...................................................... 06/12 @ 100 6,128,630 AAA 5,000 No. California Pwr. Agcy., Pub. Pwr. Rev., Hydroelec. Proj. 1, Ser. A, 5.00%, 7/01/28, MBIA ...................................................... 07/08 @ 101 5,082,350 AAA 2,500 No. Orange Cnty. Cmnty. Coll. Dist., Ser. A, 5.00%, 2/01/27, MBIA ........... 08/12 @ 101 2,557,925 AAA 5,000 Riverside Unified Sch. Dist., Ser. A, 5.00%, 2/01/27, FGIC .................. 02/12 @ 101 5,111,250 AAA 5,295 San Diego Cnty. Wtr. Auth., COP, Ser. A, 5.00%, 5/01/32, MBIA ............... 05/12 @ 101 5,393,752 AAA 4,805 San Diego Redev. Agcy., Centre City Proj., Ser. A, 5.00%, 9/01/28, MBIA ..... 09/11 @ 101 4,913,257 AAA 4,000 San Diego Univ. Foundation Auxiliary Organization, Ser. A, 5.00%, 3/01/37, MBIA ...................................................................... 03/12 @ 100 4,052,840 AAA 20,000 San Joaquin Hills Transp. Corridor Agcy., Toll Road Rev., Ser. A, Zero Coupon, 1/15/31, MBIA ..................................................... No Opt. Call 4,459,000 AAA 6,000 San Jose Fin. Auth., Civic Center Proj., Ser. B, 5.00%, 6/01/37, AMBAC ...... 06/12 @ 100 6,080,760 AAA 11,125 Santa Rosa Wstwtr. Rev., Ser. B, Zero Coupon, 9/01/27, AMBAC ................ No Opt. Call 3,038,905 AAA 6,000 Tustin Unified Sch. Dist., Spec. Tax Rev., Cmnty. Facs. Dist. 97-1, Ser. A, 5.00%, 9/01/38, FSA ............................................... 09/12 @ 100 6,060,240 AAA 5,280 Westlands Wtr. Dist., COP, 5.00%, 9/01/34, MBIA ............................. 09/12 @ 101 5,359,622 ------------ TOTAL LONG-TERM INVESTMENTS (COST $118,464,070) ............................. 118,895,893 MONEY MARKET FUNDS--8.0% NR 3,000 AIM Tax Free Investment Co. Cash Reserve Portfolio .......................... N/A 3,000,000 NR 3,000 SSgA Tax Free Money Mkt. Fund ............................................... N/A 3,000,000 ------------ TOTAL SHORT-TERM INVESTMENTS (COST $6,000,000) .............................. 6,000,000 TOTAL INVESTMENTS--165.8% (COST $124,464,070) ............................... 124,895,893 Liabilities in excess of other assets--(4.1)% ............................... (3,051,610) Preferred shares at redemption value, including dividends payable--(61.7)% .. (46,506,683) ------------ NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS--100% .......................... $ 75,337,600 ============
- ---------- * Using the higher of S&P's, Moody's or Fitch's rating. ** Date (month/year) and price of the earliest call or redemption. There may be other call provisions at varying prices at later dates. - -------------------------------------------------------------- KEY TO ABBREVIATIONS AMBAC -- American Municipal Bond Assurance Corporation COP -- Certificate of Participation FGIC -- Financial Guaranty Insurance Company FSA -- Financial Security Assurance MBIA -- Municipal Bond Insurance Association - -------------------------------------------------------------- See Notes to Financial Statements. 29 PORTFOLIO OF INVESTMENTS (unaudited) FEBRUARY 28, 2003 - ----------------------------------------- BlackRock California Municipal Bond Trust - -----------------------------------------
PRINCIPAL AMOUNT OPTION CALL RATING* (000) DESCRIPTION PROVISIONS** VALUE - ---------------------------------------------------------------------------------------------------------------------------------- LONG-TERM INVESTMENTS--158.6% CALIFORNIA--155.2% AAA $ 5,000 Anaheim Pub. Fin. Auth., Pub. Impvt. Proj., Ser. C, Zero Coupon, 9/01/32, FSA ................................................ No Opt. Call $ 1,018,200 A 2,500 California, GO, 5.25%, 4/01/30 ............................................. 04/12 @ 100 2,520,125 California Cnty. Tobacco Sec. Agcy. Rev., Ser. A, A+ 4,000 Kern Cnty. Fdg., 6.125%, 6/01/43 ......................................... 06/12 @ 100 3,629,920 A+ 3,250 Stanislaus Fdg., 5.875%, 6/01/43 ......................................... 06/12 @ 100 2,856,815 A- 3,500 California Dept. of Wtr. Res., Pwr. Sply. Rev., Ser. A, 5.25%, 5/01/20 ..... 05/12 @ 101 3,629,395 A2 4,000 California Edl. Facs. Auth., Univ. of San Diego, Ser. A, 5.25%, 10/01/30 ... 10/12 @ 100 4,091,600 A 3,270 California Hlth. Facs. Fin. Auth., Insured Hlth. Facs. Valleycare, Ser. A, 5.375%, 5/01/27 .................................................. 05/12 @ 100 3,330,822 AAA 20,000 California Hsg. Fin. Agcy., Home Mtg., Ser. K, Zero Coupon, 2/01/33, MBIA .. 02/12 @ 27.46 3,308,000 California Infrastructure & Econ. Dev., AAA 3,000 5.25%, 6/01/30, MBIA ..................................................... 06/07 @ 101 3,090,540 A- 3,750 J. David Gladstone Inst. Proj., 5.25%, 10/01/34 .......................... 10/11 @ 101 3,787,350 AAA 3,500 Rand Corp., Ser. A, 5.25%, 4/01/42, AMBAC ................................ 04/12 @ 100 3,636,360 California Statewide Cmnty. Dev. Auth., A 5,000 Kaiser Permanente, Ser. A, 5.50%, 11/01/32 ............................... 11/12 @ 100 5,058,150 A+ 3,250 Sutter Hlth. Oblig. Grp., Ser. B, 5.625%, 8/15/42 ........................ 08/12 @ 100 3,321,890 NR 3,500+ Charter Mac Equity Issuer Trust, Ser. B-2, 7.20%, 10/31/52 ................. 10/14 @ 100 3,665,585 BBB 3,750 Foothill/Eastn. Transp. Corridor Agcy., Toll Road Rev., 5.75%, 1/15/40 ..... 01/10 @ 101 3,794,888 A+ 3,000 Golden St. Tobacco Sec. Corp., Tobacco Settlement Rev., Ser. A-1, 6.75%, 6/01/39 ................................................. 06/13 @ 100 2,959,800 1,000 Los Angeles Regl. Arpt. Impvt., Corp. Lease Rev., Amer. Airlines Inc., B- Ser. B, 7.50%, 12/01/24 .................................................. 12/12 @ 102 735,770 B- 1,000 Ser. C, 7.50%, 12/01/24 .................................................. 12/12 @ 102 735,770 Mult. Fam. Hsg. Rev., NR 2,240 San Lucas Apts., Ser. 5, Zero Coupon, 11/01/34 ........................... 06/12 @ 100 2,258,749 NR 2,425 Westgate Courtyard Apts., Ser. 3, Zero Coupon, 11/01/34 .................. 12/11 @ 100 2,444,739 NR 2,400 Orange Cnty. Cmnty. Facs. Dist., Spl. Tax, Ladera Ranch, Ser. A, 6.00%, 8/15 .................................................... 08/10 @ 101 2,460,552 BBB 3,000 Palm Springs Mobile Home Park, Sahara Mobile Home Park, 5.75%, 5/15/37 ..... 05/12 @ 102 3,058,050 NR 2,500 San Francisco City & Cnty. Redev. Agcy., Cmnty. Facs. Dist., Mission Bay South, 6.25%, 8/01/33 ........................................ 08/11 @ 101 2,513,925 AAA 15,000 Santa Ana Unified Sch. Dist., COP, Zero Coupon, 4/01/29, FSA ............... No Opt. Call 3,748,500 AAA 3,500 Santa Clara Valley Wtr. Dist., Wtr. Util. Sys. Rev., Ser. A, 5.125%, 6/01/31, FGIC ............................................ 06/10 @ 100 3,598,735 A+ 1,500 Torrance Hosp. Rev., Torrance Mem. Med Ctr., Ser. A, 5.50%, 6/01/31 ........ 06/11 @ 101 1,541,010 ------------ 76,795,240 ------------ PUERTO RICO--3.4% A- 1,645 Puerto Rico Elec. Pwr. Auth., Ser. II, 5.25%, 7/01/31 ...................... 07/12 @ 101 1,682,341 ------------ TOTAL INVESTMENTS--158.6% (COST $76,881,425) ............................... 78,477,581 Other assets in excess of liabilities--2.0% ................................ 992,981 Preferred shares at redemption value, including dividends payable--(60.6)% . (29,978,690) ------------ NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS--100% ......................... $ 49,491,872 ============
- ---------- * Using the higher of S&P's, Moody's or Fitch's rating. ** Date (month/year) and price of the earliest call or redemption. There may be other call provisions at varying prices at later dates. + Security is not registered under the Securities Act of 1933. These securities may be resold in transactions in accordance with Rule 144A under that Act, to qualified institutional buyers. As of February 28, 2003, the Trust held 7.4% of its net assets, with a current market value of $3,665,585, in securities restricted as to resale.
- --------------------------------------------------------------------------------------------------------------------- KEY TO ABBREVIATIONS AMBAC -- American Municipal Bond Assurance Corporation FSA -- Financial Security Assurance COP -- Certificate of Participation GO -- General Obligation FGIC -- Financial Guaranty Insurance Company MBIA -- Municipal Bond Insurance Association - ---------------------------------------------------------------------------------------------------------------------
See Notes to Financial Statements. 30 PORTFOLIO OF INVESTMENTS (unaudited) FEBRUARY 28, 2003 - ---------------------------------------------- BlackRock California Municipal Income Trust II - ----------------------------------------------
PRINCIPAL AMOUNT OPTION CALL RATING* (000) DESCRIPTION PROVISIONS** VALUE - ---------------------------------------------------------------------------------------------------------------------------------- LONG-TERM INVESTMENTS--158.6% CALIFORNIA--156.6% Anaheim Pub. Fin. Auth., Pub. Impvt. Proj., Ser. C, FSA, AAA $15,000 Zero Coupon, 9/01/34 ..................................................... No Opt. Call $ 2,725,350 AAA 10,000 Zero Coupon, 9/01/36 ..................................................... No Opt. Call 1,625,100 California Cnty. Tobacco Sec. Agcy. Rev., A1 4,500 Gold Country Fdg. Corp., 6.00%, 6/01/38 .................................. 06/12 @ 100 4,058,640 A+ 5,515 Ser. B, 6.00%, 6/01/29 ................................................... 06/12 @ 100 5,202,079 A+ 1,600 Stanislaus Fdg., Ser. A, 5.875%, 6/01/43 ................................. 06/12 @ 100 1,406,432 A- 6,000 California Dept. of Wtr. Res., Pwr. Sply. Rev., Ser. A, 5.375%, 5/01/21 .... 05/12 @ 101 6,242,340 AAA 8,000 California Edl. Facs. Auth., Institute of Tech., Ser. A, 5.00%, 10/01/32 ... 10/11 @ 100 8,174,480 California Infrastructure & Econ. Dev., Ser. A, A 1,735 Kaiser Hosp. Asst. LLC, 5.55%, 8/01/31 ................................... 08/11 @ 102 1,780,301 AAA 2,500 Rand Corp., 5.25%, 4/01/42, AMBAC ........................................ 04/12 @ 100 2,597,400 California Statewide Cmnty. Dev. Auth., BBB+ 5,000 Disposal Republic Svcs. A, 4.95%, 12/01/12 ............................... No Opt. Call 5,010,150 A 5,000 Kaiser Permanente, Ser. A, 5.50%, 11/01/32 ............................... 11/12 @ 100 5,058,150 A- 7,000 Mem. Hlth. Svcs., Ser. A, 5.50%, 10/01/33 ................................ 04/13 @ 100 7,030,590 A+ 8,000 Sutter Hlth. Oblig Corp., Ser. B, 5.50%, 8/15/34 ......................... 08/12 @ 100 8,145,040 California Statewide Fin. Auth., Tobacco Settlement Rev., A+ 5,000 Ser. A, 6.00%, 5/01/37 ................................................... 05/12 @ 100 4,513,550 A+ 1,750 Ser. B, 6.00%, 5/01/43 ................................................... 05/12 @ 100 1,573,320 AAA 6,000 Corona Norco Unified Sch. Dist., Spl. Tax, Cmnty. Facs. Dist. No. 98-1, 5 10%, 9/01/32, AMBAC ....................... 09/12 @ 100 6,151,380 Foothill/Eastn. Transp. Corridor Agcy., Toll Road Rev., Ser. A, AAA 15,470 Zero Coupon, 1/01/26 ..................................................... ETM 4,848,143 AAA 4,890 Zero Coupon, 1/01/30 ..................................................... ETM 1,227,586 A+ 4,000 Golden St. Tobacco Sec. Corp., Tobacco Settlement Rev., Ser. A-1, 6.75%, 6/0 ..................................................... 06/13 @ 100 3,946,400 AAA 5,000 La Quinta Redev. Agcy. Tax Allocation, Redev. Proj. Area No. 1, 5.125%, 9/01/32, AMBAC ................................................... 09/12 @ 102 5,158,250 AAA 5,500 Los Angeles Dept. of Wtr. & Pwr., Wtr. Wks. Rev., Ser. A, 5.125%, 7/01/41, FGIC ............................................ 07/11 @ 100 5,595,315 B- 2,500 Los Angeles Regl. Arpt. Impvt. Corp. Lease Rev., Amer. Airlines Inc., Ser. C, 7.50%, 12/01/24 .................................................. 12/12 @ 102 1,839,425 AAA 5,000 Los Angeles Wstwtr. Sys. Rev., Ser. A, 5.00%, 6/01/27, MBIA ................ 06/13 @ 100 5,093,800 Oxnard Impvt. Bond Act 1915, Spec. Assmt. Dist. No. 01, 1 Rice Avenue, NR 1,940 5.625%, 9/02/27 .......................................................... 09/03 @ 103 1,903,334 NR 1,935 5.70%, 9/02/32 ........................................................... 09/03 @ 103 1,902,434 AAA 4,525 Port Oakland, Ser. L, 5.00%, 11/01/32, FGIC .............................. 11/12 @ 100 4,534,503 AAA 5,000 Poway Redev. Agcy. Tax Allocation, Paguay Redev. Proj., 5.125%, 6/15/33, AMBAC ................................................... 12/11 @ 101 5,138,700 Poway Unified Sch. Dist., Spl. Tax, Cmnty. Facs. Dist. No. 6, NR 1,500 5.50%, 9/01/25 ........................................................... 09/10 @ 102 1,458,525 NR 1,700 5.60%, 9/01/33 ........................................................... 09/10 @ 102 1,646,909 AAA 5,000 Sacramento City Fin. Auth., Cap. Impvt., Ser. A, 5.00%, 12/01/32, AMBAC .... 06/11 @ 100 5,077,800 NR 6,000 San Bernardino Cnty., Spl. Tax, Cmnty. Facs., 5.90%, 9/01/33 ............... 09/12 @ 102 5,826,660 San Diego Unified Sch. Dist., Ser. D, FGIC, AAA 8,000 5.00%, 7/01/27 ........................................................... 07/12 @ 100 8,168,960 AAA 8,665 5.25%, 7/01/23 ........................................................... 07/12 @ 101 9,228,485 NR 5,000 San Francisco City & Cnty. Redev. Agcy., Cmnty. Facs. Dist., Mission Bay South, 6.25%, 8/01/33 ........................................ 08/11 @ 101 5,027,850 AAA 30,000 San Joaquin Hills Transp. Corridor Agcy., Toll Road Rev., Ser. A, Zero Coupon, 1/15/34, MBIA ....................................... No Opt. Call 5,639,400 NR 8,000 San Jose Mult. Fam. Hsg. Rev., Helzer Courts Apts. Proj., Ser. A, 6.40%, 12/01/41 .................................................. 12/09 @ 102 7,953,600 Santa Clarita Facs. Dist., Valencia Town Center, NR 1,640 5.80%, 11/15/25 .......................................................... 11/10 @ 102 1,645,871 NR 1,500 5.85%, 11/15/32 .......................................................... 11/10 @ 102 1,505,355 AAA 2,685 Santa Rosa Wstwtr. Rev., Ser. B, Zero Coupon, 9/01/25, AMBAC ............... No Opt. Call 822,603 Tustin Unified Sch. Dist., Spec. Tax Rev., Cmnty. Facs. Dist. 97-1, AAA 5,000 Ser. A, 5.00%, 9/01/38, FSA .............................................. 09/12 @ 100 5,050,200 NR 2,000 Ser. B, 5.60%, 9/01/29 ................................................... 09/12 @ 101 2,003,920 ------------ 173,538,330 ============
See Notes to Financial Statements. 31
PRINCIPAL AMOUNT OPTION CALL RATING* (000) DESCRIPTION PROVISIONS** VALUE - ---------------------------------------------------------------------------------------------------------------------------------- PUERTO RICO--2.0% A- $ 2,230 Puerto Rico Elec. Pwr. Auth., Ser. D, 5.00%, 7/01/28 ....................... 07/08 @ 101.5 $ 2,233,835 ------------ TOTAL LONG-TERM INVESTMENTS (COST $175,009,544) ............................ 175,772,165 ------------ MONEY MARKET FUND--4.5% NR 5,000 AIM Tax Free Investment Co. Cash Reserve Portfolio (cost $5,000,000) ....... N/A 5,000,000 ------------ TOTAL INVESTMENTS--163.1% (COST $180,009,544) .............................. 180,772,165 Other assets in excess of liabilities--1.8% ................................ 2,024,736 Preferred shares at redemption value, including dividends payable--(64.9)% . (71,953,854) ------------ NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS--100% ......................... $110,843,047 ============
- ---------- * Using the higher of S&P's, Moody's or Fitch's rating. ** Date (month/year) and price of the earliest call or redemption. There may be other call provisions at varying prices at later dates.
- --------------------------------------------------------------------------------------------------------------------- KEY TO ABBREVIATIONS AMBAC -- American Municipal Bond Assurance Corporation FSA -- Financial Security Assurance ETM -- Escrowed to Maturity MBIA -- Municipal Bond Insurance Association FGIC -- Financial Guaranty Insurance Company - ---------------------------------------------------------------------------------------------------------------------
See Notes to Financial Statements. 32 PORTFOLIO OF INVESTMENTS (unaudited) FEBRUARY 28, 2003 - ---------------------------------------------- BlackRock California Municipal Income Trust II - ----------------------------------------------
PRINCIPAL AMOUNT OPTION CALL RATING* (000) DESCRIPTION PROVISIONS** VALUE - ---------------------------------------------------------------------------------------------------------------------------------- LONG-TERM INVESTMENTS--158.9% FLORIDA--151.7% Florida Brd. of Ed., AAA $ 9,000 GO, Ser. A, 5.00%, 6/01/27, FSA .......................................... 06/12 @ 101 $ 9,176,220 AAA 8,640 Lottery Rev., Ser. C, 5.00%, 1/01/22, MBIA ............................... 01/13 @ 101 8,935,574 AAA 7,000 Florida Dept. of Transp., 5.00%, 7/01/27, FSA .............................. 07/12 @ 101 7,137,970 AAA 9,695 Gainesville Util. Sys. Rev., Ser. A, 5.00%, 10/01/33, FSA .................. 10/13 @ 100 9,849,926 A- 8,500 Highlands Cnty. Hlth. Facs. Auth., Hosp. Adventist/Sunbelt, Ser. A, 6.00%, 11/15/31 .................................................. 11/11 @ 101 8,954,325 AAA 12,580 Hillsborough Cnty. Sch. Brd., COP, Ser. A, 5.00%, 7/01/25, MBIA ............ 07/10 @ 100 12,794,992 AAA 2,865 Jacksonville Cap. Impvt., Ser. A, 5.00%, 10/01/30, AMBAC ................... 10/12 @ 100 2,911,470 AAA 8,000 Jacksonville Excise Tax Rev., Ser. B, 5.00%, 10/01/26, AMBAC ............... 10/12 @ 100 8,148,320 AAA 9,500 Jacksonville Sales Tax Rev., 5.00%, 10/01/27, MBIA ......................... 10/13 @ 100 9,691,330 AAA 9,500 Jacksonville Transp. Rev., 5.00%, 10/01/31, MBIA ........................... 10/11 @ 100 9,633,380 AAA 1,500 Julington Creek Plantation Cmnty. Dev., Assmt. Rev., 5.00%, 5/01/29, MBIA .. 05/12 @ 101 1,526,760 AAA 9,000 Lake Cnty. Sch. Brd., COP, Ser. A, 5.00%, 7/01/28, AMBAC ................... 07/13 @ 100 9,147,960 AAA 26,935 Miami Dade Cnty., Spec. Oblig. Rev., Ser. B, Zero Coupon, 10/01/31, MBIA ... 04/08 @ 28.079 5,603,827 AAA 7,975 Orange Cnty. Sales Tax Rev., Ser. B, 5.125%, 1/01/32, FGIC ................. 01/13 @ 100 8,171,903 AAA 2,000 Orange Cnty. Sch. Brd., COP, Ser. A, 5.00%, 8/01/27, MBIA .................. 08/12 @ 100 2,031,940 AAA 9,250 Orange Cnty. Tourist Dev., Tax Rev., 5.125%, 10/01/30, AMBAC ............... 04/12 @ 100 9,477,642 AAA 4,000 Osceola Cnty. Sch. Brd., COP, Ser. A, 5.25%, 6/01/27, AMBAC ................ 06/12 @ 101 4,175,200 Palm Bay Util. Rev., FGIC, AAA 4,015 Zero Coupon, 10/01/28 .................................................... No Opt. Call 1,078,028 AAA 5,570 Zero Coupon, 10/01/31 .................................................... No Opt. Call 1,277,869 AAA 17,700 Palm Beach Cnty. Sch. Brd., COP, Ser. D, 5.00%, 8/01/28, FSA ............... 08/12 @ 100 17,969,394 AA- 5,000 Pinellas Cnty. Hlth. Fac. Auth., Baycare Hlth. Sys., 5.50%, 11/15/33 ....... 05/13 @ 100 4,994,800 AAA 9,500 Pinellas Cnty. Swr. Rev., 5.00%, 10/01/32, FSA ............................. 10/13 @ 100 9,651,810 Aaa 5,000 Polk Cnty. Util. Sys. Rev., 5.00%, 10/01/29, FGIC .......................... 10/13 @ 100 5,092,350 AAA 2,325 Port St. Lucie Util. Rev., 5.125%, 9/01/31, MBIA ........................... 09/11 @ 100 2,377,522 AAA 2,945 Sarasota Cnty. Util. Sys. Rev., Ser. C, 5.25%, 10/01/22, FGIC .............. 10/12 @ 100 3,106,769 Aa3 2,250 So. Broward Hosp. Dist. Rev., 5.60%, 5/01/27 ............................... 05/12 @ 101 2,309,153 A2 4,750 So. Lake Cnty. Hosp. Dist. Rev., So. Lake Hosp. Inc., 5.80%, 10/01/34 ...... 10/09 @ 101 4,834,027 AAA 3,500 St. Petersburg Pub. Util. Rev., Ser. A, 5.00%, 10/01/28, FSA ............... 10/09 @ 101 3,550,610 AAA 2,000 Tampa Bay Wtr. Util. Sys. Rev., Ser. A, 5.00%, 10/01/28, FGIC .............. 10/11 @ 100 2,032,300 Village Cmnty. Dev., Assmt. Rev., NR 5,000 Ser. A, 6.50%, 5/01/33 ................................................... 05/13 @ 101 5,035,500 NR 1,000 Ser. B, 5.40%, 5/01/07 ................................................... No Opt. Call 1,004,480 ------------ 191,683,351 ============ PUERTO RICO--7.2% A+ 9,405 Children's Trust Fund Tobacco Settlement Rev., 5.625%, 5/15/43 ............. 05/12 @ 100 9,094,447 TOTAL INVESTMENTS--158.9% (COST $198,561,373) .............................. 200,777,798 Other assets in excess of liabilities--1.2% ................................ 1,577,754 Preferred shares at redemption value, including dividends payable--(60.1)% . (76,008,912) ------------ NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS--100% $126,346,640 ============
- ---------- * Using the higher of S&P's, Moody's or Fitch's rating. ** Date (month/year) and price of the earliest call or redemption. There may be other call provisions at varying prices at later dates.
- --------------------------------------------------------------------------------------------------------------------- KEY TO ABBREVIATIONS AMBAC -- American Municipal Bond Assurance Corporation FSA -- Financial Security Assurance COP -- Certificate of Participation GO -- General Obligation FGIC -- Financial Guaranty Insurance Company MBIA -- Municipal Bond Insurance Association - ---------------------------------------------------------------------------------------------------------------------
See Notes to Financial Statements. 33 PORTFOLIO OF INVESTMENTS (unaudited) FEBRUARY 28, 2003 - ----------------------------------------- BlackRock California Municipal Bond Trust - -----------------------------------------
PRINCIPAL AMOUNT OPTION CALL RATING* (000) DESCRIPTION PROVISIONS** VALUE - ---------------------------------------------------------------------------------------------------------------------------------- LONG-TERM INVESTMENTS--157.2% FLORIDA--143.4% AAA $ 1,250 Bay Cnty. Sales Tax Rev., 5.125%, 9/01/32, AMBAC ........................... 09/12 @ 100 $ 1,280,063 A 1,000 Boynton Beach Multi. Fam. Rev., Clipper Cove Apts., 5.30%, 1/01/23, ACA .... 01/13 @ 100 1,014,150 NR 3,000+ Charter Mac Equity Issuer Trust, Ser. B-2, 7.20%, 10/31/52 ................. 10/14 @ 100 3,141,930 AAA 3,150 Florida Mun. Loan Council, Ser. A, 5.125%, 5/01/32, MBIA ................... 05/12 @ 101 3,229,947 AAA 3,100 Greater Orlando Aviation Auth., Orlando Arpt. Facs., Ser. A, 5.125%, 10/01/32, FSA ............................................ 10/12 @ 100 3,158,280 A- 4,900 Highlands Cnty. Hlth. Facs. Auth., Hosp. Adventist/Sunbelt, Ser. A, 6.00%, 11/15/31 .................................................. 11/11 @ 101 5,161,905 A2 4,000 Hillsborough Cnty. Ind. Dev. Auth., PCR, Tampa Elec. Co. Proj., 5.50%, 10/01/23 .......................................................... 10/12 @ 100 3,970,320 AA 3,500 Jacksonville Econ. Dev. Comm. Hlth. Facs., Mayo Clinic, Ser. B, 5.50%, 11/15/36 .................................................. 11/11 @ 101 3,643,815 AA+ 5,000 JEA Elec. Sys. Rev., Ser. A, 5.50%, 10/01/41 ............................... 10/07 @ 100 5,179,300 AAA 5,425 JEA Wtr. & Swr. Sys. Rev., Ser. A, 5.375%, 10/01/30, MBIA .................. 04/07 @ 100 5,568,491 A1 3,000 Lakeland Hosp. Sys. Rev., Lakeland Regl. Hlth. Sys., 5.50%, 11/15/32 ....... 11/12 @ 101 3,013,950 Miami Dade Cnty., Spec. Oblig. Rev., MBIA, AAA 5,500 Ser. A, Zero Coupon, 10/01/26 ............................................ 04/08 @ 37.301 1,530,485 AAA 10,000 Ser. B, Zero Coupon, 10/01/30 ............................................ 04/08 @ 29.688 2,203,300 AAA 5,410 Ser. B, Zero Coupon, 10/01/32 ............................................ 04/08 @ 26.494 1,061,117 A2 5,000 Orange Cnty. Hlth. Facs. Auth., Orlando Regl. Hlth. Care, 5.75%, 12/01/32 .. 12/12 @ 100 5,091,650 AAA 1,250 Orange Cnty. Sch. Brd., COP, Ser. A, 5.00%, 8/01/27, MBIA .................. 08/12 @ 100 1,269,963 AAA 3,350 Orange Cnty. Tourist Dev., Tax Rev., 5.125%, 10/01/30, AMBAC ............... 04/12 @ 100 3,432,444 AAA 3,105 Osceola Cnty. Tourist Dev., Tax Rev., Ser. A, 5.00%, 10/01/32, FGIC ........ 10/12 @ 100 3,150,612 AAA 3,630 Palm Bay Util. Rev., Zero Coupon, 10/01/28, FGIC ........................... No Opt. Call 974,655 AAA 3,000 Palm Beach Cnty. Sch. Brd., COP, Ser. C, 5.00%, 8/01/27, FSA ............... 08/12 @ 100 3,043,380 AAA 5,000 Port St. Lucie Util. Rev., 5.125%, 9/01/31, MBIA ........................... 09/11 @ 100 5,112,950 Aa3 2,000 So. Broward Hosp. Dist. Rev., 5.60%, 5/01/27 ............................... 05/12 @ 101 2,052,580 NR 2,850 Sumter Cnty. Indl. Dev. Auth., No. Sumter Util. Co. LLC, 6.80%, 10/01/32 ... 10/09 @ 100 2,857,638 NR 1,900 Village Cmnty. Dev., Assmt. Rev., Ser. A, 6.50%, 5/01/33 ................... 05/13 @ 101 1,913,490 ------------ 72,056,415 ------------ PUERTO RICO--13.8% A+ 3,500 Children's Trust Fund Tobacco Settlement Rev., 5.625%, 5/15/43 ............. 05/12 @ 100 3,384,430 A- 3,500 Puerto Rico Pub. Bldgs. Auth., Gov't. Facs., Ser. D, 5.25%, 7/01/36 ........ 07/12 @ 100 3,554,705 ------------ 6,939,135 ------------ TOTAL INVESTMENTS--157.2% (COST $75,998,564) ............................... 78,995,550 Other assets in excess of liabilities--2.0% ................................ 1,040,024 Preferred shares at redemption value, including dividends payable--(59.2)% . (29,776,630) ------------ NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS--100% $ 50,258,944 ============
- ---------- * Using the higher of S&P's, Moody's or Fitch's rating. ** Date (month/year) and price of the earliest call or redemption. There may be other call provisions at varying prices at later dates. + Security is not registered under the Securities Act of 1933. These securities may be resold in transactions in accordance with Rule 144A under that Act, to qualified institutional buyers. As of February 28, 2003, the Trust held 6.3% of its net assets, with a current market value of $3,141,930, in securities restricted as to resale.
- ---------------------------------------------------------------------------------------------------------------------- KEY TO ABBREVIATIONS ACA -- American Capital Access FSA -- Financial Security Assurance AMBAC -- American Municipal Bond Assurance Corporation MBIA -- Municipal Bond Insurance Association COP -- Certificate of Participation PCR -- Pollution Control Revenue FGIC -- Financial Guaranty Insurance Company - ----------------------------------------------------------------------------------------------------------------------
See Notes to Financial Statements. 34 PORTFOLIO OF INVESTMENTS (unaudited) FEBRUARY 28, 2003 - --------------------------------------- BlackRock Maryland Municipal Bond Trust - ---------------------------------------
PRINCIPAL AMOUNT OPTION CALL RATING* (000) DESCRIPTION PROVISIONS** VALUE - ---------------------------------------------------------------------------------------------------------------------------------- LONG-TERM INVESTMENTS--157.5% MARYLAND--128.8% A3 $ 2,870 Anne Arundel Cnty. Econ. Dev., Cmnty. Coll. Proj., 5.25%, 9/01/28 .......... 09/12 @ 102 $ 2,943,673 Baltimore Cnty., GO, AAA 2,000 Met. 67th Dist., 5.00%, 6/01/22 .......................................... 06/11 @ 101 2,092,100 AAA 2,000 Met. 68th Dist., 5.00%, 8/01/28 .......................................... 08/12 @ 100 2,053,320 Baltimore Wstwtr. Proj., Ser. A, FGIC, AAA 2,000 5.125%, 7/01/42 .......................................................... 07/12 @ 100 2,045,760 AAA 3,500 5.20%, 7/01/32 ........................................................... 07/12 @ 100 3,626,245 NR 2,000+ Charter Mac Equity Issuer Trust, Ser. B-2, 7.20%, 10/31/52 ................. 10/14 @ 100 2,094,620 Aa2 2,355 Maryland Dept. Hsg. & Cmnty. Dev. Admin., Sngl. Fam. Prog., Ser. 2, 6.55%, 4/01/26 ................................................... 04/05 @ 102 2,447,128 Baa3 1,500 Maryland Econ. Dev. Corp., Student Hsg. Rev., Univ. of Maryland, Ser. A, 5.75%, 10/01/33 .................................................. 10/13 @ 100 1,492,005 Maryland Hlth. & Higher Edl. Facs. Auth., A 2,000 Brd. of Child Care, 5.375%, 7/01/32 ...................................... 07/12 @ 100 2,049,700 BBB+ 1,990 Carroll Cnty. Gen. Hosp., 6.00%, 7/01/37 ................................. 07/12 @ 100 2,071,411 AA 2,000 Johns Hopkins Univ., Ser. B, 5.00%, 7/01/41 .............................. 07/11 @ 100 2,017,700 A 2,000 Loyola Coll. Issue, 5.00%, 10/01/39 ...................................... 10/09 @ 101 2,012,460 A3 2,000 Union Hosp. of Cecil Cnty., 5.625%, 7/01/32 .............................. 07/12 @ 100 2,045,120 A 2,000 Univ. of Maryland Med. Sys., 5.25%, 7/01/34 .............................. 07/11 @ 100 1,988,740 A+ 1,905 Maryland Ind. Dev. Fin. Auth., Econ. Dev. Rev., Nat'l. Aquarium Baltimore Fac., Ser. B, 5.20%, 11/01/26 .................. 11/12 @ 100 1,938,699 AAA 2,000 Maryland Transp. Auth., Arpt. Pkg. Rev., Baltimore/Wash Intl. Arpt., Ser. B, 5.125%, 3/01/24, AMBAC ........................................... 03/12 @ 101 2,049,060 Montgomery Cnty. Lease Rev., Metrorail Garage Proj., AA 500 5.00%, 6/01/23 ........................................................... 06/12 @ 100 514,635 AA 1,435 5.00%, 6/01/24 ........................................................... 06/12 @ 100 1,472,654 St. Marys Coll., Academic & Auxil. Fees, Ser. A, AMBAC, AAA 1,000 5.00%, 9/01/27 ........................................................... 09/12 @ 101 1,023,360 AAA 1,000 5.00%, 9/01/32 ........................................................... 09/12 @ 101 1,019,210 ------------ 38,997,600 ------------ PUERTO RICO--28.7% A+ 2,000 Children's Trust Fund Tobacco Settlement Rev., 5.625%, 5/15/43 ............. 05/12 @ 100 1,933,960 A 2,000 Puerto Rico Comnwlth. Hwy. & Transp. Auth., Ser. D, 5.25%, 7/01/38 ......... 07/12 @ 100 2,032,760 AAA 2,060 Puerto Rico Elec. Pwr. Auth., Ser. HH, 5.25%, 7/01/29, FSA ................. 07/10 @ 101 2,153,359 Puerto Rico Pub. Bldgs. Auth., Gov't. Facs., Ser. D, A- 1,000 5.25%, 7/01/36 ........................................................... 07/12 @ 100 1,015,630 A- 1,500 5.375%, 7/01/33 .......................................................... 07/12 @ 100 1,536,150 ------------ 8,671,859 ------------ TOTAL INVESTMENTS--157.5% (COST $46,048,317) ............................... 47,669,459 Other assets in excess of liabilities--2.0% ................................ 597,903 Preferred shares at redemption value, including dividends payable--(59.5)% . (18,000,296) ------------ NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS--100% ......................... $ 30,267,066 ============
- ---------- * Using the higher of S&P's, Moody's or Fitch's rating. ** Date (month/year) and price of the earliest call or redemption. There may be other call provisions at varying prices at later dates. + Security is not registered under the Securities Act of 1933. These securities may be resold in transactions in accordance with Rule 144A under that Act, to qualified institutional buyers. As of February 28, 2003, the Trust held 6.9% of its net assets, with a current market value of $2,094,620, in securities restricted as to resale.
- ------------------------------------------------------------------------------------------------------------------ KEY TO ABBREVIATIONS AMBAC -- American Municipal Bond Assurance Corporation FSA -- Financial Security Assurance FGIC -- Financial Guaranty Insurance Company GO -- General Obligation - ------------------------------------------------------------------------------------------------------------------
See Notes to Financial Statements. 35 PORTFOLIO OF INVESTMENTS (unaudited) FEBRUARY 28, 2003 - ----------------------------------------- BlackRock New Jersey Municipal Bond Trust - -----------------------------------------
PRINCIPAL AMOUNT OPTION CALL RATING* (000) DESCRIPTION PROVISIONS** VALUE - ---------------------------------------------------------------------------------------------------------------------------------- LONG-TERM INVESTMENTS--156.0% NEW JERSEY--118.7% NR $ 2,000+ Charter Mac Equity Issuer Trust, Ser. B-2, 7.20%, 10/31/52 ................. 10/14 @ 100 $ 2,094,620 New Jersey Econ. Dev. Auth., B+ 2,500 Continental Airlines Inc. Proj., 7.00%, 11/15/30 ......................... 11/10 @ 101 1,819,075 BBB- 2,000 Fellowship Village, Ser. A, 5.50%, 1/01/25 ............................... 01/08 @ 102 1,871,720 Baa3 4,750 Kapkowski Road Landfill Proj., 6.50%, 4/01/28 ............................ No Opt. Call 5,207,852 Aaa 1,790 Victoria Hlth., Ser. A, 5.20%, 12/20/36 .................................. 12/11 @ 103 1,846,027 BBB- 1,000 New Jersey Edl. Facs. Auth., Fairleigh Dickinson Univ., Ser. D, 6.00%, 7/01/25 ................................................... 07/13 @ 100 1,013,250 New Jersey Hlth. Care Facs. Fin. Auth., A- 2,000 Atlantic City Med. Ctr., 5.75%, 7/01/25 .................................. 07/12 @ 100 2,078,280 A+ 2,000 Catholic Hlth. East, Ser. A, 5.375%, 11/15/33 ............................ 11/12 @ 100 2,009,100 A3 2,000 Kennedy Hlth. Sys., 5.625%, 7/01/31 ...................................... 07/11 @ 100 2,034,080 Baa1 2,500 So. Jersey Hosp., 6.00%, 7/01/32 ......................................... 07/12 @ 100 2,538,125 AAA 2,250 New Jersey Hsg. & Mtg. Fin. Agcy., Mult. Fam. Hsg. Rev., Ser. A, 5.65%, 5/01/40, AMBAC ............................................ 11/07 @ 101.5 2,344,050 Port Auth. of NY & NJ, AAA 1,500 Ser. 125, 5.00%, 4/15/32, FSA ............................................ 04/12 @ 101 1,539,270 AAA 2,250 Ser. 126, 5.25%, 5/15/37, FGIC ........................................... 05/12 @ 101 2,329,965 B3 130 Spec. Oblig. Rev., Cont'l./Eastern Proj. LaGuardia, 9.125%, 12/01/15 ..... 04/03 @ 100 131,169 A+ 7,000 Tobacco Settlement Fin. Corp., 6.125%, 6/01/42 ............................. 06/12 @ 100 6,199,410 AAA 1,000 Univ. of Medicine & Dentistry, Ser. A, 5.00%, 12/01/31, AMBAC .............. 12/12 @ 100 1,021,910 Vineland, GO, MBIA, AAA 1,000 5.30%, 5/15/29 ........................................................... 05/10 @ 101 1,034,960 AAA 1,500 5.375%, 5/15/32 .......................................................... 05/10 @ 101 1,558,980 ------------ 38,671,843 ------------ PUERTO RICO--37.3% A 4,900 Puerto Rico Comnwlth. Hwy. & Transp. Auth., Ser. D, 5.25%, 7/01/38 ......... 07/12 @ 100 4,980,262 A- 2,250 Puerto Rico Elec. Pwr. Auth., Ser. II, 5.25%, 7/01/31 ...................... 07/12 @ 101 2,301,075 Puerto Rico Pub. Bldgs. Auth., Gov't. Facs., Ser. D, A- 2,300 5.25%, 7/01/27 ........................................................... 07/12 @ 100 2,353,153 A- 2,500 5.25%, 7/01/36 ........................................................... 07/12 @ 100 2,539,075 ------------ 12,173,565 ------------ TOTAL INVESTMENTS--156.0% (COST $50,519,559) ............................... 50,845,408 Other assets in excess of liabilities--6.1% ................................ 1,974,378 Preferred shares at redemption value, including dividends payable--(62.1)% . (20,226,752) ------------ NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS--100% ......................... $ 32,593,034 ============
- ---------- * Using the higher of S&P's, Moody's or Fitch's rating. ** Date (month/year) and price of the earliest call or redemption. There may be other call provisions at varying prices at later dates. + Security is not registered under the Securities Act of 1933. These securities may be resold in transactions in accordance with Rule 144A under that Act, to qualified institutional buyers. As of February 28, 2003, the Trust held 6.4% of its net assets, with a current market value of $2,094,620, in securities restricted as to resale.
- ---------------------------------------------------------------------------------------------------------------------- KEY TO ABBREVIATIONS AMBAC -- American Municipal Bond Assurance Corporation GO -- General Obligation FGIC -- Financial Guaranty Insurance Company MBIA -- Municipal Bond Insurance Association FSA -- Financial Security Assurance - ----------------------------------------------------------------------------------------------------------------------
See Notes to Financial Statements. 36 PORTFOLIO OF INVESTMENTS (unaudited) FEBRUARY 28, 2003 - ------------------------------------------------- BlackRock New York Insured Municipal Income Trust - -------------------------------------------------
PRINCIPAL AMOUNT OPTION CALL RATING* (000) DESCRIPTION PROVISIONS** VALUE - ---------------------------------------------------------------------------------------------------------------------------------- LONG-TERM INVESTMENTS--156.4% NEW YORK--132.8% Met. Transp. Auth., Ser. A, AAA $ 1,085 5.00%, 11/15/25, FGIC .................................................... 11/12 @ 100 $ 1,106,982 AAA 7,000 5.00%, 11/15/30, FSA ..................................................... 11/12 @ 100 7,098,280 AAA 5,000 5.25%, 11/15/31, FGIC .................................................... 11/12 @ 100 5,201,600 AAA 5,000 Dedicated Tax Fund, 5.00%, 11/15/28, FSA ................................. 11/12 @ 100 5,077,950 AAA 5,000 Dedicated Tax Fund, 5.00%, 11/15/31, FGIC ................................ 11/11 @ 100 5,063,800 AAA 10,000 Svc. Contract Rev., 5.00%, 7/01/30, AMBAC ................................ 07/12 @ 100 10,135,700 A 2,500 New York City Indl. Dev. Agcy., Lycee Francais De Proj., Ser. A, 5.375%, 6/01/23, ACA ............................................. 12/12 @ 100 2,535,500 AAA 10,000 New York City Mun. Wtr. Fin. Auth., Ser. A, 5.125%, 6/15/34, FSA ........... 06/12 @ 100 10,212,800 AAA 7,000 New York City Transl. Fin. Auth., Ser. B, 5.00%, 5/01/30, AMBAC ............ 11/11 @ 101 7,098,000 AAA 5,000 New York City Trust Cultural Res. Rev., Museum Modern Art, Ser. D, 5.125%, 7/01/31, AMBAC ........................................... 07/12 @ 100 5,158,550 New York Dorm. Auth., AAA 4,500 Ser. A, 5.00%, 3/15/32, FGIC ............................................. 03/13 @ 100 4,558,140 AAA 3,160 Iona Coll., 5.00%, 7/01/27, XLCA ......................................... 07/12 @ 100 3,205,251 Aa3 3,000 Joachim & Ann Residence, 5.25%, 7/01/27 .................................. 07/12 @ 100 3,007,650 AAA 5,000 New York & Presbyterian Hosp., 5.00%, 8/01/32, AMBAC ..................... 02/08 @ 101 5,048,800 AAA 7,000 New York Univ., Ser. 2, 5.00%, 7/01/41, AMBAC ............................ 07/11 @ 100 7,061,950 AAA 2,000 Sch. Dist. Fin., Ser. A, 5.00%, 4/01/31, MBIA ............................ 10/12 @ 100 2,027,840 AAA 3,500 Sch. Dist. Fin., Ser. D, 5.00%, 10/01/30, MBIA ........................... 10/12 @ 100 3,551,415 AAA 7,000 St. Barnabas, Ser. A, 5.00%, 2/01/31, AMBAC .............................. 08/12 @ 100 7,095,900 AAA 5,000 Univ. Dorm. Facs., 5.00%, 7/01/32, MBIA .................................. 07/12 @ 100 5,060,350 AAA 2,000 Winthrop Univ. Hosp. Assoc., Ser. A, 5.25%, 7/01/31, AMBAC ............... 07/11 @ 101 2,078,100 AAA 2,500 New York Urban Dev. Corp., Ser. C-1, 5.00%, 3/15/33, FGIC .................. 03/13 @ 100 2,534,275 AAA 3,000 Port Auth. of NY & NJ, Ser. 128, 5.00%, 11/01/27, FSA ...................... 11/12 @ 101 3,089,730 AAA 10,000 Triborough Brdg. & Tunl. Auth. Rev., Ser. E, 5.00%, 11/15/32, MBIA ......... 11/12 @ 100 10,124,900 Aa2 6,000 TSASC Inc., Tobacco Settlement Rev., Ser. 1, 5.75%, 7/15/32 ................ 07/12 @ 100 5,915,760 ------------ 123,049,223 ------------ PUERTO RICO--23.6% A1 11,000 Children's Trust Fund Tobacco Settlement Rev., 5.625%, 5/15/43 ............. 05/12 @ 100 10,636,780 A 5,000 Puerto Rico Indl. Fin. Auth., Medical & Env. Ctrl. Facs., Polytechnic Univ., Ser. A, 5.00%, 8/01/32, ACA .............................................. 08/12 @ 100 5,015,850 AAA 6,000 Puerto Rico Mun. Fin. Agcy., Ser. A, 5.00%, 8/01/27, FSA ................... 08/12 @ 100 6,178,440 ------------ 21,831,070 ------------ TOTAL INVESTMENTS--156.4% (COST $143,210,303) .............................. 144,880,293 Other assets in excess of liabilities--4.0% ................................ 3,730,005 Preferred shares at redemption value, including dividends payable--(60.4)% . (56,001,610) ------------ NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS--100% ......................... $ 92,608,688 ============
- ---------- * Using the higher of S&P's, Moody's or Fitch's rating. ** Date (month/year) and price of the earliest call or redemption. There may be other call provisions at varying prices at later dates.
- ---------------------------------------------------------------------------------------------------------------------- KEY TO ABBREVIATIONS ACA -- American Capital Access FSA -- Financial Security Assurance AMBAC -- American Municipal Bond Assurance Corporation MBIA -- Municipal Bond Insurance Association FGIC -- Financial Guaranty Insurance Company XLCA -- XL Capital Assurance - ----------------------------------------------------------------------------------------------------------------------
See Notes to Financial Statements. 37 PORTFOLIO OF INVESTMENTS (unaudited) FEBRUARY 28, 2003 - --------------------------------------- BlackRock New York Municipal Bond Trust - ---------------------------------------
PRINCIPAL AMOUNT OPTION CALL RATING* (000) DESCRIPTION PROVISIONS** VALUE - ---------------------------------------------------------------------------------------------------------------------------------- LONG-TERM INVESTMENTS--157.4% NEW YORK--118.0% NR $ 2,500+ Charter Mac Equity Issuer Trust, Ser. B-2, 7.20%, 10/31/52 ................. 10/14 @ 100 $ 2,618,275 AA 2,000 Dutchess Cnty. Ind. Dev. Agcy., Civic Facs. Rev., Vassar Coll. Proj., 5.35%, 9/01/40 ........................................................... 08/11 @ 101 2,077,440 A 3,000 Met. Transp. Auth., Dedicated Tax Fund, Ser. A, 5.125%, 11/15/31 ........... 11/12 @ 100 3,029,160 A+ 3,000 New York City, GO, Ser. D, 5.375%, 6/01/32 ................................. 06/12 @ 100 3,029,730 A3 1,100 New York City Hlth. & Hosp. Corp., Hlth. Sys., Ser. A, 5.375%, 2/15/26 ..... 02/12 @ 100 1,116,357 AA 2,500 New York City Hsg. Dev. Corp., Mult. Fam. Hsg. Rev., Ser. A, 5.50%, 11/01/34 05/12 @ 100 2,553,900 AAA 2,500 New York City Mun. Wtr. Fin. Auth., Ser. A, 5.25%, 6/15/33, FGIC ........... 06/11 @ 100 2,586,625 New York Dorm. Auth., AA- 2,750 City Univ., Ser. A, 5.25%, 7/01/31 ....................................... 07/11 @ 100 2,805,852 AAA 2,500 Iona Coll., 5.125%, 7/01/32, XLCA ........................................ 07/12 @ 100 2,547,775 A- 3,000 Lenox Hill Hosp. Oblig. Grp., 5.50%, 7/01/30 ............................. 07/11 @ 101 3,075,930 AAA 2,500 Willow Towers Inc. Proj., 5.40%, 2/01/34 ................................. 08/12 @ 101 2,597,025 AAA 2,750 New York Env. Facs. Corp., Mun. Wtr. Proj., Ser. D, 5.125%, 6/15/31 ........ 06/12 @ 100 2,823,013 Aa1 3,000 New York Mtg. Agcy., Ser. 101, 5.40%, 4/01/32 .............................. 10/11 @ 100 3,053,400 AA 5,000 New York Urban Dev. Corp., Ser. A, 5.25%, 3/15/32 .......................... 03/12 @ 100 5,109,100 Port Auth. of NY & NJ, AAA 2,750 Ser. 126, 5.25%, 5/15/37, FGIC ........................................... 05/12 @ 101 2,847,735 B3 2,600 Spec. Oblig. Rev., Cont'l./Eastern Proj. LaGuardia, 9.125%, 12/01/15 ..... 04/03 @ 100 2,623,374 Aa2 3,000 TSASC Inc., Tobacco Settlement Rev., Ser. 1, 5.75%, 7/15/32 ................ 07/12 @ 100 2,957,880 ------------ 47,452,571 ------------ PUERTO RICO--39.4% A+ 5,150 Children's Trust Fund Tobacco Settlement Rev., 5.625%, 5/15/43 ............. 05/12 @ 100 4,979,947 A- 3,000 Puerto Rico Comnwlth., GO, Ser. A, 5.125%, 7/01/31 ......................... 07/11 @ 100 3,027,420 A 3,000 Puerto Rico Comnwlth. Hwy. & Transp. Auth., Ser. D, 5.25%, 7/01/38 ......... 07/12 @ 100 3,049,140 A- 2,000 Puerto Rico Elec. Pwr. Auth., Ser. II, 5.25%, 7/01/31 ...................... 07/12 @ 101 2,045,400 A- 2,700 Puerto Rico Pub. Bldgs. Auth., Gov't. Facs., Ser. D, 5.25%, 7/01/27 ........ 07/12 @ 100 2,762,397 ------------ 15,864,304 ------------ TOTAL INVESTMENTS--157.4% (COST $61,320,951) ............................... 63,316,875 Other assets in excess of liabilities--2.8% ................................ 1,118,131 Preferred shares at redemption value, including dividends payable--(60.2)% . (24,202,029) ------------ NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS--100% ......................... $ 40,232,977 ============
- ---------- * Using the higher of S&P's, Moody's or Fitch's rating. ** Date (month/year) and price of the earliest call or redemption. There may be other call provisions at varying prices at later dates. + Security is not registered under the Securities Act of 1933. These securities may be resold in transactions in accordance with Rule 144A under that Act, to qualified institutional buyers. As of February 28, 2003, the Trust held 6.5% of its net assets, with a current market value of $2,618,275, in securities restricted as to resale.
- ------------------------------------------------------------------------------------------------------ KEY TO ABBREVIATIONS FGIC -- Financial Guaranty Insurance Company XLCA -- XL Capital Assurance GO -- General Obligation - ------------------------------------------------------------------------------------------------------
See Notes to Financial Statements. 38 PORTFOLIO OF INVESTMENTS (unaudited) FEBRUARY 28, 2003 - -------------------------------------------- BlackRock New York Municipal Income Trust II - --------------------------------------------
PRINCIPAL AMOUNT OPTION CALL RATING* (000) DESCRIPTION PROVISIONS** VALUE - ---------------------------------------------------------------------------------------------------------------------------------- LONG-TERM INVESTMENTS--157.9% NEW YORK--143.8% Aaa $ 1,750 Clarence Indl. Dev. Agcy., Civic Fac. Rev., Bristol Village Proj., 6.00%, 1/20/44 ........................................................... 01/13 @ 102 $ 1,902,723 AA 6,000 Dutchess Cnty. Ind. Dev. Agcy., Civic Facs. Rev., Vassar Coll. Proj., 5.35%, 9/01/40 ........................................................... 08/11 @ 101 6,232,320 BBB 625 Essex Cnty. Indl. Dev. Agcy., Solid Wst. Disp. Rev., Intl. Paper Co. Proj., Ser. A, 5.50%, 10/01/26 .................................................. No Opt. Call 613,675 Aaa 3,250 Geneva Indl. Dev. Agcy., Civic Fac. Rev., Hobart & William Smith Proj., Ser. A, 5.375%, 2/01/33 .................................................. 02/13 @ 100 3,373,532 AAA 3,515 Long Island Pwr. Auth., Elec. Sys. Rev., Ser. A, Zero Coupon, 6/01/28, FSA . No Opt. Call 996,362 Met. Transp. Auth., Ser. A, AAA 5,000 5.25%, 11/15/31, FGIC .................................................... 11/12 @ 100 5,201,600 AA- 5,000 Dedicated Tax Fund, 5.00%, 11/15/30 ...................................... 11/12 @ 100 5,023,950 AA- 5,000 Svc. Contract Rev., 5.125%, 1/01/29 ...................................... 07/12 @ 100 5,069,300 A 5,000 New York City, GO, Ser. B, 5.75%, 12/01/22 ................................. 12/11 @ 100 5,277,950 New York City Indl. Dev. Agcy., Ser. A, AAA 1,000 Eger Harbor Proj., 4.95%, 11/20/32 ....................................... 11/12 @ 101 992,800 AAA 1,000 Eger Harbor Proj., 5.875%, 5/20/44 ....................................... 11/12 @ 105 1,089,960 A 1,500 Lycee Francais De Proj., 5.375%, 6/01/23, ACA ............................ 12/12 @ 100 1,521,300 AA 5,000 New York City Mun. Wtr. Fin. Auth., Ser. A, 5.125%, 6/15/34 ................ 06/12 @ 100 5,106,400 AAA 5,000 New York City Trans. Auth., Met. Transp. Auth., Triborough Brdg. & Tunl. Auth., COP, Ser. A, 5.25%, 1/01/29, AMBAC ....... 01/10 @ 101 5,175,000 AA+ 5,000 New York City Transl. Fin. Auth., Ser. B, 5.00%, 11/01/27 .................. 11/12 @ 100 5,050,700 New York Dorm. Auth., AAA 2,425 New Sch. Univ., 5.00%, 7/01/31, MBIA ..................................... 07/11 @ 100 2,454,755 AAA 3,000 New York Univ., Ser. 2, 5.00%, 7/01/41, AMBAC ............................ 07/11 @ 100 3,026,550 AAA 2,500 St. Barnabas, Ser. A, 5.00%, 2/01/31, AMBAC .............................. 08/12 @ 100 2,534,250 AA 1,000 Mount St. Mary Coll., 5.00%, 7/01/32, RAA ................................ 07/13 @ 100 1,001,080 AA- 5,000 Univ. Dorm. Facs., 5.00%, 7/01/32 ........................................ 07/12 @ 100 5,019,300 A+ 5,500 New York Energy Res. & Dev. Auth., Facs. Rev., 4.70%, 6/01/36 .............. 10/05 @ 100 5,513,035 AAA 5,000 New York Env. Facs. Corp., Mun. Wtr. Proj., Ser. K, 5.00%, 6/15/28 ......... 06/12 @ 100 5,093,850 AA 5,000 New York Urban Dev. Corp., Ser. C-1, 5.00%, 3/15/33 ........................ 03/13 @ 100 5,021,100 B3 3,675 Port Auth. of NY & NJ, Spec. Oblig. Rev., Cont'l./Eastern Proj. LaGuardia, 9.125%, 12/01/15 ......................................................... 04/03 @ 100 3,708,038 Triborough Brdg. & Tunl. Auth. Rev., AA 2,500 Ser. A, 5.00%, 1/01/32 ................................................... 01/12 @ 100 2,519,775 AA 4,000 Ser. B, 5.00%, 11/15/27 .................................................. 11/12 @ 100 4,049,960 Aa2 9,000 TSASC Inc., Tobacco Settlement Rev., Ser. 1, 5.75%, 7/15/32 .............. 07/12 @ 100 8,873,640 ------------ 101,442,905 ------------ PUERTO RICO--14.1% A+ 4,000 Children's Trust Fund Tobacco Settlement Rev., 5.625%, 5/15/43 ............. 05/12 @ 100 3,867,920 A- 4,000 Puerto Rico Comnwlth., GO, Ser. A, 5.125%, 7/01/31 ......................... 07/11 @ 100 4,036,560 A 2,000 Puerto Rico Comnwlth. Hwy. & Transp. Auth., Ser. D, 5.375%, 7/01/36 ........ 07/12 @ 100 2,057,200 ------------ 9,961,680 ------------ TOTAL LONG-TERM INVESTMENTS (COST $110,030,829) ............................ 111,404,585 ------------ MONEY MARKET FUND--2.8% NR 2,000 AIM Tax Free Investment Co. Cash Reserve Portfolio (cost $2,000,000) ....... N/A 2,000,000 ------------ TOTAL INVESTMENTS--160.7% (COST $112,030,829) .............................. 113,404,585 Other assets in excess of liabilities--2.6% ................................ 1,800,919 Preferred shares at redemption value, including dividends payable--(63.3)% . (44,652,567) ------------ NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS--100% ......................... $ 70,552,937 ============
- ---------- * Using the higher of S&P's, Moody's or Fitch's rating. ** Date (month/year) and price of the earliest call or redemption. There may be other call provisions at varying prices at later dates.
- ---------------------------------------------------------------------------------------------------------------------- KEY TO ABBREVIATIONS ACA -- American Capital Access FSA -- Financial Security Assurance AMBAC -- American Municipal Bond Assurance Corporation GO -- General Obligation COP -- Certificate of Participation MBIA -- Municipal Bond Insurance Association FGIC -- Financial Guaranty Insurance Company RAA -- Radian Asset Assurance - ----------------------------------------------------------------------------------------------------------------------
See Notes to Financial Statements. 39 PORTFOLIO OF INVESTMENTS (unaudited) FEBRUARY 28, 2003 - -------------------------------------------- BlackRock New York Municipal Income Trust II - --------------------------------------------
PRINCIPAL AMOUNT OPTION CALL RATING* (000) DESCRIPTION PROVISIONS** VALUE - ---------------------------------------------------------------------------------------------------------------------------------- LONG-TERM INVESTMENTS--156.4% DISTRICT OF COLUMBIA--6.6% AAA $ 1,500 Met. Arpts. Auth., Arpt. Sys. Rev., Ser. A, 5.25%, 10/01/32, FGIC .......... 10/12 @ 100 $ 1,530,900 ------------ VIRGINIA--143.5% NR 1,500 Alexandria Redev. & Hsg. Auth., 3001 Park Center Apts., Ser. A, 6.375%, 4/01/34 ................................................ 04/08 @ 103 1,478,955 AAA 1,500 Arlington Cnty., GO, 5.00%, 2/01/21 ........................................ 02/11 @ 100 1,552,545 A 3,000 Arlington Cnty. Ind. Dev. Auth., Hosp. Fac. Rev., Virginia Hosp. Ctr. Arlington Hlth. Sys., 5.25%, 7/01/31 ..................................... 07/11 @ 101 3,023,250 NR 1,500+ Charter Mac Equity Issuer Trust, Ser. B-2, 7.20%, 10/31/52 ................. 10/14 @ 100 1,570,965 AAA 1,500 Danville Ind. Dev. Auth., Hosp. Rev., Danville Regl. Med. Ctr, 5.25%, 10/01/28, AMBAC .......................................................... No Opt. Call 1,617,750 NR 1,000 Dulles Town Ctr. Cmnty. Dev. Auth., Spl. Assmt. Tax, Dulles Town Ctr. Proj., 6.25%, 3/01/26 ................................... 03/08 @ 102 1,002,540 AAA 1,500 Fairfax Cnty. Wtr. Auth., Wtr. Rev, 5.00%, 4/01/27 ......................... 04/12 @ 100 1,533,225 AA 1,000 Hampton, GO, 5.00%, 4/01/20 ................................................ 04/12 @ 101 1,051,470 A- 1,500 Henrico Cnty. Econ. Dev. Auth., Bon Secours Hlth. Sys. Inc., Ser. A, 5.60%, 11/15/30 .................................................. 11/12 @ 100 1,527,615 AAA 1,500 Norfolk Arpt. Auth., Ser. A, 5.125%, 7/01/31, FGIC ......................... 07/11 @ 100 1,525,995 NR 500 Peninsula Port Auth., Residential Care Fac. Rev., Virginia Baptist Homes, Ser. A, 7.375%, 12/01/32 ................................................. 12/13 @ 100 500,320 A 5,000 Pocahontas Pkwy. Assoc., Toll Road Rev., Ser. B, Zero Coupon, 8/15/22, ACA . 08/08 @ 45.5 1,465,400 AA 1,375 Prince William Cnty., COP, 5.00%, 12/01/21 ................................. 06/12 @ 100 1,429,972 AAA 1,250 Richmond Met. Auth., Expwy. Rev., 5.25%, 7/15/22, FGIC ..................... No Opt. Call 1,380,688 AAA 3,000 Richmond Pub. Util. Rev., 5.00%, 1/15/33, FSA .............................. 01/12 @ 100 3,060,690 AA 1,500 Virginia Beach Dev. Auth., Pub. Fac. Rev., Town Ctr. Proj. Phase I, Ser. A, 5.00%, 8/1/22 .................................................... 08/12 @ 100 1,551,570 Virginia Coll. Bldg. Auth., Edl. Facs. Rev., Washington & Lee Univ. Proj., MBIA, AAA 500 5.25%, 1/01/26 ........................................................... No Opt. Call 546,465 AAA 1,000 5.25%, 1/01/31 ........................................................... No Opt. Call 1,095,120 AAA 3,000 Virginia Hsg. Dev. Auth., Comnwlth. Mtg. Rev., Ser. H, 5.375%, 7/01/36, MBIA 07/11 @ 100 3,077,640 Virginia Res. Auth., AA 1,000 Infrastructure Rev., Ser. A, 5.00%, 5/01/22 .............................. 05/11 @ 101 1,033,600 AA 635 Infrastructure Rev., Ser. A, 5.125%, 5/01/27 ............................. 05/11 @ 101 654,056 AA 1,500 Wtr. & Swr. Sys. Rev., Frederick Cnty. Sanitation Auth. Proj., 5.20%, 10/01/28 ........................................................ 10/10 @ 100 1,549,260 ------------ 33,229,091 ------------ PUERTO RICO--6.3% A+ 1,500 Children's Trust Fund Tobacco Settlement Rev., 5.625%, 5/15/43 ............. 05/12 @ 100 1,450,470 ------------ TOTAL INVESTMENTS--156.4% (COST $34,696,683) ............................... 36,210,461 Other assets in excess of liabilities--2.0% ................................ 470,731 Preferred shares at redemption value, including dividends payable--(58.4)% . (13,525,268) ------------ NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS--100% $ 23,155,924 ============
- ---------- * Using the higher of S&P's, Moody's or Fitch's rating. ** Date (month/year) and price of the earliest call or redemption. There may be other call provisions at varying prices at later dates. + Security is not registered under the Securities Act of 1933. These securities may be resold in transactions in accordance with Rule 144A under that Act, to qualified institutional buyers. As of February 28, 2003, the Trust held 6.8% of its net assets, with a current market value of $1,570,965, in securities restricted as to resale.
- ---------------------------------------------------------------------------------------------------------------------- KEY TO ABBREVIATIONS ACA -- American Capital Access FSA -- Financial Security Assurance AMBAC -- American Municipal Bond Assurance Corporation GO -- General Obligation COP -- Certificate of Participation MBIA -- Municipal Bond Insurance Association FGIC -- Financial Guaranty Insurance Company - ----------------------------------------------------------------------------------------------------------------------
See Notes to Financial Statements. 40 STATEMENTS OF ASSETS AND LIABILITIES (UNAUDITED) FEBRUARY 28, 2003 - --------------------------------------------------------------------------------
CALIFORNIA INSURED INSURED MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL ASSETS INCOME TRUST BOND TRUST INCOME TRUST II INCOME TRUST -------------- ------------- --------------- -------------- Investments at value(1) ....................... $ 602,581,447 $237,337,562 $ 530,322,479 $124,895,893 Cash .......................................... 1,186,685 822,715 114,007 880,205 Receivable from investments sold .............. -- -- 10,643,104 -- Interest receivable ........................... 6,289,482 3,282,708 6,594,234 1,549,419 Other assets .................................. 26,657 48,492 39,778 9,082 ------------- ------------ ------------- ------------ 610,084,271 241,491,477 547,713,602 127,334,599 ------------- ------------ ------------- ------------ LIABILITIES Payable to custodian .......................... -- -- -- -- Payable for investments purchased ............. -- -- 18,256,110 5,045,583 Dividends payable -- common shares ............ 2,037,306 854,133 1,905,985 394,590 Investment advisory fee payable ............... 161,567 63,980 160,334 32,298 Deferred Trustees fees ........................ 782 2,113 2,237 249 Other accrued expenses ........................ 157,625 276,602 149,768 17,596 ------------- ------------ ------------- ------------ 2,357,280 1,196,828 20,474,434 5,490,316 ------------- ------------ ------------- ------------ PREFERRED SHARES AT REDEMPTION VALUE $25,000 liquidation value per share, including dividends payable(2,3) ...................... 228,997,880 90,504,768 205,564,229 46,506,683 ------------- ------------ ------------- ------------ NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS ........................... $ 378,729,111 $149,789,881 $ 321,674,939 $ 75,337,600 ============= ============ ============= ============ Composition of Net Assets Applicable to Common Shareholders: Par value ................................... $ 26,078 $ 10,123 $ 22,758 $ 5,261 Paid-in capital in excess of par ............ 370,066,914 143,453,136 322,946,039 74,639,545 Undistributed (distributions in excess of) net investment income ..................... 904,154 1,090,681 769,365 146,059 Accumulated net realized gain (loss) ........ 326,217 (237,708) (4,317,520) 114,912 Net unrealized appreciation ................. 7,405,748 5,473,649 2,254,297 431,823 ------------- ------------ ------------- ------------ Net assets applicable to common shareholders, February 28, 2003 ........................... $ 378,729,111 $149,789,881 $ 321,674,939 $ 75,337,600 ============= ============ ============= ============ Net asset value per common share(4)............ $14.52 $14.80 $14.13 $14.32 ====== ====== ====== ====== (1)Investments at cost ........................ $ 595,175,699 $231,863,913 $ 528,068,182 $124,464,070 (2)Preferred shares outstanding ............... 9,159 3,620 8,222 1,860 (3)Par value per share ........................ 0.001 0.001 0.001 0.001 (4)Common shares outstanding .................. 26,077,512 10,123,055 22,758,028 5,261,197
See Notes to Financial Statements 41 - --------------------------------------------------------------------------------
FLORIDA CALIFORNIA CALIFORNIA INSURED FLORIDA MARYLAND NEW JERSEY MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL BOND TRUST INCOME TRUST II INCOME TRUST BOND TRUST BOND TRUST BOND TRUST ---------- ----------- ---------- ---------- ---------- ---------- $ 78,477,581 $ 180,772,165 $ 200,777,798 $ 78,995,550 $ 47,669,459 $ 50,845,408 283,294 539,896 -- 31,602 95,563 1,384,353 -- 4,985,314 5,284,250 -- -- -- 1,035,207 2,298,515 2,425,950 1,322,839 686,405 818,317 23,721 18,009 9,786 22,842 3,544 3,761 - -------------- -------------- -------------- -------------- -------------- -------------- 79,819,803 188,613,899 208,497,784 80,372,833 48,454,971 53,051,839 - -------------- -------------- -------------- -------------- -------------- -------------- -- -- 334,629 -- -- -- -- 5,045,583 5,081,900 -- -- -- 261,809 646,932 653,327 252,348 140,940 175,473 21,874 55,457 53,837 21,323 12,863 14,092 1,522 753 259 1,522 1,530 1,531 64,036 68,273 18,280 62,066 32,276 40,957 - -------------- -------------- -------------- -------------- -------------- -------------- 349,241 5,816,998 6,142,232 337,259 187,609 232,053 - -------------- -------------- -------------- -------------- -------------- -------------- 29,978,690 71,953,854 76,008,912 29,776,630 18,000,296 20,226,752 - -------------- -------------- -------------- -------------- -------------- -------------- $ 49,491,872 $ 110,843,047 $ 126,346,640 $ 50,258,944 $ 30,267,066 $ 32,593,034 ============== ============== ============== ============== ============== ============== $ 3,351 $ 7,962 $ 8,711 $ 3,310 $ 2,013 $ 2,264 47,466,833 112,975,671 123,622,622 46,865,682 28,480,824 32,036,718 288,715 (266,316) (2,460) 226,675 156,715 134,881 136,817 (2,636,891) 501,342 166,291 6,372 93,322 1,596,156 762,621 2,216,425 2,996,986 1,621,142 325,849 - -------------- -------------- -------------- -------------- -------------- -------------- $ 49,491,872 $ 110,843,047 $ 126,346,640 $ 50,258,944 $ 30,267,066 $ 32,593,034 ============== ============== ============== ============== ============== ============== $14.77 $13.92 $14.50 $15.19 $15.03 $14.40 ====== ====== ====== ====== ====== ====== $ 76,881,425 $ 180,009,544 $ 198,561,373 $ 75,998,564 $ 46,048,317 $ 50,519,559 1,199 2,878 3,040 1,191 720 809 0.001 0.001 0.001 0.001 0.001 0.001 3,351,150 7,962,244 8,711,027 3,309,483 2,013,427 2,264,170
42 STATEMENTS OF ASSETS AND LIABILITIES (unaudited) (continued) FEBRUARY 28, 2003 - --------------------------------------------------------------------------------
NEW YORK INSURED NEW YORK NEW YORK VIRGINIA MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL ASSETS INCOME TRUST BOND TRUST INCOME TRUST II BOND TRUST ------------ ------------ --------------- ------------ Investments at value(1)......................... $ 144,880,293 $ 63,316,875 $ 113,404,585 $ 36,210,461 Cash ........................................... 557,710 484,756 847,865 153,093 Receivable from investments sold ............... 7,229,382 -- -- -- Interest receivable ............................ 1,677,120 878,040 1,428,547 456,545 Other assets ................................... 9,339 22,989 8,539 2,196 ------------- ------------ ------------- ------------ 154,353,844 64,702,660 115,689,536 36,822,295 ------------- ------------ ------------- ------------ LIABILITIES Payable for investments purchased .............. 5,204,106 -- -- -- Dividends payable-- common shares .............. 480,602 205,950 388,476 107,033 Investment advisory fee payable ................ 39,570 16,819 35,072 9,748 Deferred Trustees fees ......................... 249 1,509 752 1,509 Other accrued expenses ......................... 19,019 43,376 59,732 22,813 ------------- ------------ ------------- ------------ 5,743,546 267,654 484,032 141,103 ------------- ------------ ------------- ------------ PREFERRED SHARES AT REDEMPTION VALUE $25,000 liquidation value per share, including dividends payable(2,3)........................ 56,001,610 24,202,029 44,652,567 13,525,268 ------------- ------------ ------------- ------------ NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS ............................ $ 92,608,688 $ 40,232,977 $ 70,552,937 $ 23,155,924 ============= ============ ============= ============ Composition of Net Assets Applicable to Common Shareholders: Par value .................................... $ 6,408 $ 2,701 $ 4,933 $ 1,516 Paid-in capital in excess of par ............. 90,928,968 38,236,462 69,960,661 21,419,765 Undistributed (distributions in excess of) net investment income ...................... 11,113 141,430 (195,840) 175,985 Accumulated net realized gain (loss) ......... (7,791) (143,540) (590,573) 44,880 Net unrealized appreciation .................. 1,669,990 1,995,924 1,373,756 1,513,778 ------------- ------------ ------------- ------------ Net assets applicable to common shareholders, February 28, 2003 ............................ $ 92,608,688 $ 40,232,977 $ 70,552,937 $ 23,155,924 ============= ============ ============= ============ Net asset value per common share(4) ............ $14.45 $14.90 $14.30 $15.28 ====== ====== ====== ====== (1)Investments at cost ......................... $ 143,210,303 $ 61,320,951 $ 112,030,829 $ 34,696,683 (2)Preferred shares outstanding ................ 2,240 968 1,786 541 (3)Par value per share ......................... 0.001 0.001 0.001 0.001 (4)Common shares outstanding ................... 6,408,028 2,700,991 4,933,028 1,515,507
See Notes to Financial Statements. 43 STATEMENTS OF OPERATIONS (unaudited) FOR THE PERIOD(1) ENDED FEBRUARY 28, 2003 - --------------------------------------------------------------------------------
CALIFORNIA INSURED INSURED MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL NET INVESTMENT INCOME INCOME TRUST BOND TRUST INCOME TRUST II INCOME TRUST -------------- -------------- --------------- -------------- Interest Income ................................. $ 8,450,686 $ 7,136,674 $ 13,991,862 $ 1,650,371 ------------- ------------ ------------- ------------ EXPENSES Investment advisory ........................... 928,920 769,471 1,365,873 188,249 Transfer agent ................................ 6,612 8,000 8,000 5,607 Custodian ..................................... 13,224 33,987 40,129 4,331 Reports to shareholders ....................... 22,416 18,750 26,000 7,924 Trustees ...................................... 15,765 9,328 21,847 4,190 Registration .................................. 10,529 10,118 9,270 7,520 Independent accountants ....................... 13,848 33,882 25,691 13,121 Legal ......................................... 8,598 7,439 12,583 3,159 Insurance ..................................... 5,625 3,901 8,831 1,985 Organization .................................. 15,000 -- -- 15,000 Auction Agent ................................. 130,925 117,340 232,555 27,414 Miscellaneous ................................. 14,972 16,344 21,247 4,756 ------------- ------------ ------------- ------------ Total expenses .............................. 1,186,434 1,028,560 1,772,026 283,256 Less fees waived by Advisor ................. (337,789) (355,140) (372,511) (68,454) Less fees paid indirectly ................... -- (10,919) (17,589) -- ------------- ------------ ------------- ------------ Net expenses ................................ 848,645 662,501 1,381,926 214,802 ------------- ------------ ------------- ------------ Net investment income ........................... 7,602,041 6,474,173 12,609,936 1,435,569 ------------- ------------ ------------- ------------ REALIZED AND UNREALIZED GAIN (LOSS) Net realized gain (loss) ........................ 326,217 (7,197) (4,317,520) 114,912 Net change in unrealized appreciation ........... 7,405,748 170,674 608,639 431,823 ------------- ------------ ------------- ------------ Net gain (loss) ................................. 7,731,965 163,477 (3,708,881) 546,735 ------------- ------------ ------------- ------------ DIVIDENDS AND DISTRIBUTIONS TO PREFERRED SHAREHOLDERS FROM: Net investment income ......................... (593,974) (556,517) (1,189,093) (106,100) Net realized gains ............................ -- (68,481) -- -- ------------- ------------ ------------- ------------ Total dividends and distributions ............... (593,974) (624,998) (1,189,093) (106,100) ------------- ------------ ------------- ------------ NET INCREASE IN NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS RESULTING FROM OPERATIONS ....................... $ 14,740,032 $ 6,012,652 $ 7,711,962 $ 1,876,204 ============= ============ ============= ============
- ---------- (1)Commencements of investment operations for the Insured Trusts were October 31, 2002. See Notes to Financial Statements. 44 STATEMENTS OF OPERATIONS (unaudited) (continued) FOR THE PERIOD(1) ENDED FEBRUARY 28, 2003 - --------------------------------------------------------------------------------
CALIFORNIA FLORIDA CALIFORNIA MUNICIPAL INSURED FLORIDA MUNICIPAL INCOME MUNICIPAL MUNICIPAL NET INVESTMENT INCOME BOND TRUST TRUST II INCOME TRUST BOND TRUST ---------- ---------- ---------- ---------- Interest Income .................................. $ 2,211,371 $ 4,376,367 $ 2,456,609 $ 2,131,812 ------------- ------------ ------------- ------------- EXPENSES Investment advisory ............................ 256,333 476,672 309,085 255,660 Transfer agent ................................. 7,989 7,933 5,694 7,868 Custodian ...................................... 7,584 28,928 5,334 7,584 Reports to shareholders ........................ 8,500 11,225 9,957 8,606 Trustees ....................................... 6,164 9,075 5,085 6,148 Registration ................................... 11,518 3,625 7,520 11,394 Independent accountants ........................ 22,812 25,125 13,282 22,703 Legal .......................................... 3,450 5,951 4,179 3,450 Insurance ...................................... 1,397 3,726 2,458 1,333 Organization ................................... -- -- 15,000 -- Auction Agent .................................. 39,630 81,531 44,274 40,284 Miscellaneous .................................. 10,231 14,307 6,150 10,263 ------------- ------------ ------------- ------------- Total expenses ............................... 375,608 668,098 428,018 375,293 Less fees waived by Advisor .................. (118,308) (130,002) (112,395) (117,997) Less fees paid indirectly .................... -- (21,453) -- -- ------------- ------------ ------------- ------------- Net expenses ................................. 257,300 516,643 315,623 257,296 ------------- ------------ ------------- ------------- Net investment income ............................ 1,954,071 3,859,724 2,140,986 1,874,516 ------------- ------------ ------------- ------------- REALIZED AND UNREALIZED GAIN (LOSS) Net realized gain (loss) ......................... 349,841 (2,636,891) 501,342 378,259 Net change in unrealized appreciation ............ (594,535) (53,901) 2,216,425 610,291 ------------- ------------ ------------- ------------- Net gain (loss) .................................. (244,694) (2,690,792) 2,717,767 988,550 ------------- ------------ ------------- ------------- DIVIDENDS AND DISTRIBUTIONS TO PREFERRED SHAREHOLDERS FROM: Net investment income .......................... (156,908) (374,124) (183,803) (151,837) Net realized gains ............................. (36,465) -- -- (25,515) ------------- ------------ ------------- ------------- Total dividends and distributions ................ (193,373) (374,124) (183,803) (177,352) ------------- ------------ ------------- ------------- NET INCREASE IN NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS RESULTING FROM OPERATIONS ........................ $ 1,516,004 $ 794,808 $ 4,674,950 $ 2,685,714 ============= ============ ============= ============
- ---------- (1)Commencements of investment operations for the Insured Trusts were October 31, 2002. See Notes to Financial Statements. 45 STATEMENTS OF OPERATIONS (UNAUDITED)(CONTINUED) FOR THE PERIOD(1) ENDED FEBRUARY 28, 2003 - --------------------------------------------------------------------------------
NEW YORK MARYLAND NEW JERSEY INSURED NEW YORK NEW YORK VIRGINIA MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL BOND TRUST BOND TRUST INCOME TRUST BOND TRUST INCOME TRUST II BOND TRUST ---------- ---------- ------------ ---------- ---------------- ------------- $ 1,246,899 $ 1,475,218 $ 1,840,893 $ 1,736,776 $ 2,625,584 $ 956,233 - -------------- -------------- -------------- -------------- -------------- -------------- 154,255 170,324 228,525 207,462 298,960 116,749 8,000 8,000 5,836 7,995 8,000 8,000 7,503 6,978 4,709 7,463 19,741 7,503 7,500 7,750 8,238 8,250 9,500 6,000 6,124 6,132 4,257 6,140 6,213 6,015 796 828 7,520 11,394 2,450 654 19,329 18,927 13,149 19,405 24,963 10,056 3,369 3,369 4,011 3,369 5,040 3,288 1,003 1,064 2,310 1,249 2,040 806 -- -- 15,000 -- -- -- 24,766 27,528 32,632 32,460 51,474 20,115 6,860 9,198 5,742 8,597 9,086 4,696 - -------------- -------------- -------------- -------------- -------------- -------------- 239,505 260,098 331,929 313,784 437,467 183,882 (71,195) (78,611) (83,100) (95,752) (81,535) (53,884) -- -- -- -- (13,602) -- - -------------- -------------- -------------- -------------- -------------- -------------- 168,310 181,487 248,829 218,032 342,330 129,998 - -------------- -------------- -------------- -------------- -------------- -------------- 1,078,589 1,293,731 1,592,064 1,518,744 2,283,254 826,235 - -------------- -------------- -------------- -------------- -------------- -------------- 92,049 164,633 (7,791) (143,155) (590,573) 195,274 472,144 (512,787) 1,669,990 384,110 662,237 488,195 - -------------- -------------- -------------- -------------- -------------- -------------- 564,193 (348,154) 1,662,199 240,955 71,664 683,469 - -------------- -------------- -------------- -------------- -------------- -------------- (108,866) (99,376) (139,145) (139,013) (251,688) (61,629) (11,020) (16,272) -- (21,351) -- (22,888) - -------------- -------------- -------------- -------------- -------------- -------------- (119,886) (115,648) (139,145) (160,364) (251,688) (84,517) - -------------- -------------- -------------- -------------- -------------- -------------- $ 1,522,896 $ 829,929 $ 3,115,118 $ 1,599,335 $ 2,103,230 $ 1,425,187 ============== ============== ============== ============== ============== ==============
46 STATEMENTS OF CHANGES IN NET ASSETS FOR THE PERIOD(1) ENDED FEBRUARY 28, 2003 (UNAUDITED), AND FOR THE PERIOD(2) ENDED AUGUST 31, 2002 - --------------------------------------------------------------------------------
INSURED MUNICIPAL INCOME TRUST MUNICIPAL BOND TRUST MUNICIPAL INCOME TRUST II ------------- ------------------------ ------------------------------ INCREASE (DECREASE) IN NET ASSETS 2003 2003 2002 2003 2002 APPLICABLE TO COMMON SHAREHOLDERS ------------- --------- ---------- ----------- ------------ OPERATIONS: Net investment income .......................... $ 7,602,041 $ 6,474,173 $ 3,112,184 $ 12,609,936 $ 784,425 Net realized gain (loss) ....................... 326,217 (7,197) 367,062 (4,317,520) -- Net change in unrealized appreciation .......... 7,405,748 170,674 5,302,975 608,639 1,645,658 Dividends to preferred shareholders from: Net investment income ........................ (593,974) (556,517) (257,276) (1,189,093) -- Net realized gain ............................ -- (68,481) -- -- -- ------------- ------------- ------------- ------------- ------------ Net increase in net assets resulting from operations ............................ 14,740,032 6,012,652 8,524,945 7,711,962 2,430,083 ------------- ------------- ------------- ------------- ------------ DIVIDENDS AND DISTRIBUTIONS TO COMMON SHAREHOLDERS FROM: Net investment income .......................... (6,103,913) (5,124,788) (2,557,095) (11,435,903) -- Net realized gain .............................. -- (529,092) -- -- -- ------------- ------------- ------------- ------------- ------------ Total dividends and distributions ............ (6,103,913) (5,653,880) (2,557,095) (11,435,903) -- ------------- ------------- ------------- ------------- ------------ CAPITAL SHARE TRANSACTIONS:(3) Net proceeds from the issuance of common shares 343,210,001 -- 133,612,802 -- 306,727,751 Net proceeds from the underwriters' over- allotment option exercised ................... 28,590,000 -- 10,743,750 4,288,500 14,325,000 Offering costs relating to the issuance of preferred shares ............................. (2,704,873) -- (1,265,738) (2,372,454) -- Reinvestment of common dividends ............... 997,864 178,549 193,896 -- -- ------------- ------------- ------------- ------------- ------------ Net proceeds from capital share transactions . 370,092,992 178,549 143,284,710 1,916,046 321,052,751 ------------- ------------- ------------- ------------- ------------ Total increase (decrease) .................. 378,729,111 537,321 149,252,560 (1,807,895) 323,482,834 ------------- ------------- ------------- ------------- ------------ NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS: Beginning of period .............................. -- 149,252,560 -- 323,482,834 -- ------------- ------------- ------------- ------------- ------------ End of period .................................... $ 378,729,111 $ 149,789,881 $ 149,252,560 $ 321,674,939 $323,482,834 ============= ============= ============= ============= ============ End of period undistributed (distributions in excess of) net investment income .......................... $ 904,154 $ 1,090,681 $ 297,813 $ 769,365 $ 784,425
- ---------- (1)Commencements of investment operations for the Insured Trusts were October 31, 2002. This information includes the initial investment by BlackRock Funding, Inc. (2)Commencements of investment operations for the Bond Trusts and the Income II Trusts were April 30, 2002, and July 30, 2002, respectively. This information includes the initial investment by BlackRock Funding, Inc. (3)Prior period amounts have been restated to conform to the current period's presentation. See Notes to Financial Statements. 47
CALIFORNIA FLORIDA INSURED INSURED MUNICIPAL CALIFORNIA CALIFORNIA MUNICIPAL INCOME TRUST MUNICIPAL BOND TRUST MUNICIPAL INCOME TRUST II INCOME TRUST ------------ ---------------------------- ----------------------------- ------------- 2003 2003 2002 2003 2002 2003 ------------ ------------ ------------ ------------- ------------ ------------- $ 1,435,569 $ 1,954,071 $ 926,051 $ 3,859,724 $ 128,802 $ 2,140,986 114,912 349,841 101,627 (2,636,891) -- 501,342 431,823 (594,535) 2,190,691 (53,901) 816,522 2,216,425 (106,100) (156,908) (79,291) (374,124) -- (183,803) -- (36,465) -- -- -- -- 1,876,204 1,516,004 3,139,078 794,808 945,324 4,674,950 (1,183,410) (1,570,851) (784,357) (3,880,718) -- (1,959,643) -- (278,186) -- -- -- -- (1,183,410) (1,849,037) (784,357) (3,880,718) -- (1,956,643) ------------ ------------ ------------ ------------- ------------ ------------- 71,605,000 -- 42,994,952 -- 105,901,001 114,493,001 3,573,750 -- 4,798,875 2,144,250 5,730,000 10,006,500 (578,925) (21,849) (425,251) (849,475) -- (910,998) 44,981 12,499 110,958 57,857 -- 42,830 ------------ ------------ ------------ ------------- ------------ ------------- 74,644,806 (9,350) 47,479,534 1,352,632 111,631,001 123,631,333 ------------ ------------ ------------ ------------- ------------ ------------- 75,337,600 (342,383) 49,834,255 (1,733,278) 112,576,325 126,346,640 ------------ ------------ ------------ ------------- ------------ ------------- -- 49,834,255 -- 112,576,325 -- -- ------------ ------------ ------------ ------------- ------------ ------------- $ 75,337,600 $ 49,491,872 $ 49,834,255 $ 110,843,047 $112,576,325 $ 126,346,640 ============ ============ ============ ============= ============ ============= $ 146,059 $ 288,715 $ 62,403 $ (266,316) $ 128,802 $ (2,460)
48 STATEMENTS OF CHANGES IN NET ASSETS (continued) FOR THE PERIOD(1) ENDED FEBRUARY 28, 2003 (UNAUDITED), AND FOR THE PERIOD(2) ENDED AUGUST 31, 2002 - --------------------------------------------------------------------------------
FLORIDA MARYLAND MUNICIPAL BOND TRUST MUNICIPAL BOND TRUST INCREASE (DECREASE) IN NET ASSETS ---------------------------- ---------------------------- APPLICABLE TO COMMON SHAREHOLDERS 2003 2002 2003 2002 ------------ ------------ ------------ ------------ OPERATIONS: Net investment income ......................... $ 1,874,516 $ 851,789 $ 1,078,589 $ 506,802 Net realized gain (loss) ...................... 378,259 -- 92,049 (2,107) Net change in unrealized appreciation ......... 610,291 2,386,695 472,144 1,148,998 Dividends to preferred shareholders from: Net investment income ....................... (151,837) (77,259) (108,866) (51,559) Net realized gain ........................... (25,515) -- (11,020) -- ------------ ------------ Net increase in net assets resulting from operations ........................... 2,685,714 3,161,225 1,522,896 1,602,134 ------------ ------------ ------------ ------------ DIVIDENDS AND DISTRIBUTIONS TO COMMON SHAREHOLDERS FROM: Net investment income ......................... (1,513,840) (756,694) (845,570) (422,681) Net realized gain ............................. (186,453) -- (72,550) -- ------------ ------------ ------------ ------------ Total dividends and distributions ........... (1,700,293) (756,694) (918,120) (422,681) ------------ ------------ ------------ ------------ CAPITAL SHARE TRANSACTIONS:(3) Net proceeds from the issuance of common shares -- 42,221,628 -- 64,447,001 Net proceeds from the underwriters' over- allotment option exercised .................. -- 5,371,875 -- 3,509,625 Offering costs relating to the issuance of preferred shares ............................ (28,492) (722,474) (50,675) (258,959) Reinvestment of common dividends .............. 18,121 8,334 8,015 2,979 ------------ ------------ ------------ ------------ Net proceeds from capital share transactions (10,371) 46,879,363 (42,660) 69,460,751 ------------ ------------ ------------ ------------ Total increase (decrease) ................. 975,050 49,283,894 562,116 29,704,950 ------------ ------------ ------------ ------------ NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS: Beginning of period ............................. 49,283,894 -- 29,704,950 -- ------------ ------------ ------------ ------------ End of period ................................... $ 50,258,944 $ 49,283,894 $ 30,267,066 $ 29,704,950 ============ ============ ============ ============ End of period undistributed (distributions in excess of) net investment income ........... $ 226,675 $ 17,836 $ 156,715 $ 32,562
- ---------- (1) Commencements of investment operations for the Insured Trusts were October 31, 2002. This information includes the initial investment by BlackRock Funding, Inc. (2) Commencements of investment operations for the Bond Trusts and the Income II Trusts were April 30, 2002, and July 30, 2002, respectively. This information includes the initial investment by BlackRock Funding, Inc. (3) Prior period amounts have been restated to conform to the current period's presentation. See Notes to Financial Statements. 49
NEW YORK INSURED NEW JERSEY MUNICIPAL NEW YORK NEW YORK MUNICIPAL BOND TRUST INCOME TRUST MUNICIPAL BOND TRUST MUNICIPAL INCOME TRUST II - ---------------------------- ------------ ---------------------------- --------------------------- 2003 2002 2003 2003 2002 2003 2002 - ------------ ------------ ------------ ------------ ------------ ------------ ----------- $ 1,293,731 $ 567,668 $ 1,592,064 $ 1,518,744 $ 679,537 $ 2,283,254 $ 103,447 164,633 88,643 (7,791) (143,155) 176,216 (590,573) -- (512,787) 838,636 1,669,990 384,110 1,611,814 662,237 711,519 (99,376) (48,286) (139,145) (139,013) (64,545) (251,688) -- (16,272) (565) -- (21,351) (247) -- -- - ------------ ------------ ------------ ------------ ------------ ------------ ----------- 829,929 1,446,096 3,115,118 1,599,335 2,402,775 2,103,230 814,966 - ------------ ------------ ------------ ------------ ------------ ------------ ----------- (1,052,836) (519,382) (1,441,806) (1,235,700) (614,992) (2,330,853) -- (143,682) (6,073) -- (155,250) (2,354) -- -- - ------------ ------------ ------------ ------------ ------------ ------------ ----------- (1,196,518) (525,455) (1,441,806) (1,390,950) (617,346) (2,330,853) -- - ------------ ------------ ------------ ------------ ------------ ------------ ----------- 25,271,852 -- 28,702,502 85,901,501 -- 35,135,552 -- -- 3,581,250 5,718,000 -- 3,438,000 1,072,125 5,013,750 (48,427) (289,857) (684,125) (37,459) (345,056) (567,282) -- 27,182 66,332 -- -- 48,126 -- -- - ------------ ------------ ------------ ------------ ------------ ------------ ----------- 28,525,497 (21,245) 32,060,227 90,935,376 (37,459) 38,276,622 504,843 - ------------ ------------ ------------ ------------ ------------ ------------ ----------- (387,834) 32,980,868 92,608,688 170,926 40,062,051 277,220 70,275,717 - ------------ ------------ ------------ ------------ ------------ ------------ ----------- 32,980,868 -- -- 40,062,051 -- 70,275,717 -- - ------------ ------------ ------------ ------------ ------------ ------------ ----------- $ 32,593,034 $ 32,980,868 $ 92,608,688 $ 40,232,977 $ 40,062,051 $ 70,552,937 $70,275,717 ============ ============ ============ ============ ============ ============ =========== $ 134,881 $ (6,638) $ 11,113 $ 141,430 $ (2,601) $ (195,840) $ 103,447
50 STATEMENTS OF CHANGES IN NET ASSETS (continued) FOR THE SIX MONTHS ENDED FEBRUARY 28, 2003 (UNAUDITED), AND FOR THE PERIOD(1) ENDED AUGUST 31, 2002 - -------------------------------------------------------------------------------- VIRGINIA MUNICIPAL BOND TRUST INCREASE (DECREASE) IN NET ASSETS ---------------------------- APPLICABLE TO COMMON SHAREHOLDERS 2003 2002 ------------ ------------ OPERATIONS: Net investment income ......................... $ 826,235 $ 412,690 Net realized gain (loss) ...................... 195,274 23,871 Net change in unrealized appreciation ......... 488,195 1,025,583 Dividends to preferred shareholders from: Net investment income ....................... (61,629) (39,206) Net realized gain ........................... (22,888) -- ------------ ------------ Net increase in net assets resulting from operations ........................... 1,425,187 1,422,938 ------------ ------------ DIVIDENDS AND DISTRIBUTIONS TO COMMON SHAREHOLDERS FROM: Net investment income ......................... (641,570) (320,535) Net realized gain ............................. (151,377) -- ------------ ------------ Total dividends and distributions ........... (792,947) (320,535) ------------ ------------ CAPITAL SHARE TRANSACTIONS:(2) Net proceeds from the issuance of common shares -- 19,270,352 Net proceeds from the underwriters' over- allotment option exercised .................. -- 2,363,625 Offering costs relating to the issuance of preferred shares ............................ (58,033) (196,816) Reinvestment of common dividends .............. 37,136 5,017 ------------ ------------ Net proceeds from capital share transactions (20,897) 21,442,178 ------------ ------------ Total increase (decrease) ................. 611,343 22,544,581 ------------ ------------ NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS: Beginning of period ............................. 22,544,581 -- ------------ ------------ End of period ................................... $ 23,155,924 $ 22,544,581 ============ ============ End of period undistributed net investment income $ 175,985 $ 52,949 - ---------- (1) Commencements of investment operations for Virginia Bond was April 30, 2002. This information includes the initial investment by BlackRock Funding, Inc. (2) Prior period amounts have been restated to conform to the current period's presentation. See Notes to Financial Statements. 51 FINANCIAL HIGHLIGHTS FOR THE PERIOD(1) ENDED FEBRUARY 28, 2003 (UNAUDITED), AND FOR THE PERIOD(2) ENDED AUGUST 31, 2002 - --------------------------------------------------------------------------------
INSURED MUNICIPAL INCOME TRUST MUNICIPAL BOND TRUST MUNICIPAL INCOME TRUST II ------------ ----------------------- ------------------------- 2003 2003 2002 2003 2002 --------- --------- --------- --------- --------- PER COMMON SHARE OPERATING PERFORMANCE: Net asset value, beginning of period(3)............... $ 14.33 $ 14.76 $ 14.33 $ 14.40 $ 14.33 --------- --------- --------- --------- --------- Investment operations: Net investment income .............................. 0.29 0.64 0.31 0.55 0.03 Net realized and unrealized gain (loss) ............ 0.28 0.02 0.52 (0.17) 0.07 Dividends to preferred shareholders: Net investment income ............................ (0.02) (0.05) (0.03) (0.05) -- Net realized gains on investments ................ -- (0.01) -- -- -- --------- --------- --------- --------- --------- Net increase from investment operations .............. 0.55 0.60 0.80 0.33 0.10 --------- --------- --------- --------- --------- Dividends to common shareholders: Net investment income .............................. (0.23) (0.51) (0.25) (0.50) -- Net realized gains on investments .................. -- (0.05) -- -- -- --------- --------- --------- --------- --------- Total dividends and distributions .................... (0.23) (0.56) -- (0.50) -- --------- --------- --------- --------- --------- Capital charges with respect to issuance of: Common shares ...................................... (0.03) -- (0.03) -- (0.03) Preferred shares ................................... (0.10) -- (0.09) (0.10) -- --------- --------- --------- --------- --------- Total capital charges ................................ (0.13) -- (0.12) (0.10) (0.03) --------- --------- --------- --------- --------- Net asset value, end of period(3)..................... $ 14.52 $ 14.80 $ 14.76 $ 14.13 $ 14.40 ========= ========= ========= ========= ========= Market value, end of period(3)........................ $ 14.01 $ 14.00 $ 14.90 $ 13.75 $ 15.00 ========= ========= ========= ========= ========= TOTAL INVESTMENT RETURN(4)............................ (5.06)% (2.28)% 1.07% (4.94)% 0.00% ========= ========= ========= ========= ========= RATIOS TO AVERAGE NET ASSETS OF COMMON SHAREHOLDERS:(5,6) Expenses after fee waiver ............................ 0.70% 0.90% 0.90% 0.88% 0.65%(7) Expenses before fee waiver ........................... 0.98% 1.40% 1.32% 1.12% 0.80%(7) Net investment income before preferred share dividends 6.30% 8.81% 6.35% 8.00% 2.82%(7) Preferred share dividends ............................ 0.49% 0.76% 0.53% 0.75% 0.00%(7) Net investment income available to common shareholders ................................ 5.81% 8.05% 5.82% 7.25% 2.82%(7) SUPPLEMENTAL DATA: Average net assets of common shareholders (000) ...... $ 363,764 $ 148,222 $ 144,196 $ 317,960 $ 307,165 Portfolio turnover ................................... 35% 5% 22% 58% 0% Net assets of common shareholders, end of period (000) ................................ $ 378,729 $ 149,790 $ 149,253 $ 321,675 $ 323,483 Preferred shares outstanding (000) ................... $ 228,975 $ 90,500 $ 90,500 $ 205,550 $ -- Asset coverage per preferred share, end of period .... $ 66,353 $ 66,380 $ 66,233 $ 64,125 $ --
- ---------- (1) Commencements of investment operations for the Insured Trusts were October 31, 2002. This information includes the initial investments by BlackRock Funding, Inc. Net asset value immediately after the closing of the public offerings were $14.30. (2) Commencements of investment operations for the Bond Trusts and the Income IITrusts were April 30, 2002, and July 30, 2002, respectively. This information includes the initial investments by BlackRock Funding, Inc. Net asset value immediately after the closing of the public offerings were $14.30. (3) Net asset value and market value are published in BARRON'S on Saturday and THE WALL STREET JOURNAL on Monday. (4) Total investment return is calculated assuming a purchase of a common share at the current market price on the first day and a sale at the current market price on the last day of each period reported. Dividends and distributions, if any, are assumed for purposes of this calculation to be reinvested at prices obtained under each Trust's dividend reinvestment plan. Total investment returns do not reflect brokerage commissions. Total investment returns for less than a full year are not annualized. Past performance is not a guarantee of future results. (5) Ratios are calculated on the basis of income and expenses applicable to both the common and preferred shares relative to the average net assets of the common shareholders. (6) Annualized. (7) These ratios are not indicative of future expense ratios, due to the short operating history of the Income II Trusts. Please refer to each Trust's prospectus for the estimated expense ratios. The information in these Financial Highlights represents the unaudited operating performance for a common share outstanding, total investment returns, ratios to average net assets and other supplemental data for each period indicated. This information has been determined based upon financial information provided in the financial statements and market value data for each Trust's common shares. See Notes to Financial Statements 52 FINANCIAL HIGHLIGHTS FOR THE PERIOD(1) ENDED FEBRUARY 28, 2003 (UNAUDITED), AND FOR THE PERIOD(2) ENDED AUGUST 31, 2002 - --------------------------------------------------------------------------------
CALIFORNIA INSURED MUNICIPAL CALIFORNIA CALIFORNIA INCOME TRUST MUNICIPAL BOND TRUST MUNICIPAL INCOME TRUST II ------------ ---------------------- ------------------------- 2003 2003 2002 2003 2002 --------- --------- --------- --------- --------- PER COMMON SHARE OPERATING PERFORMANCE: Net asset value, beginning of period(3)............... $ 14.33 $ 14.87 $ 14.33 $ 14.42 $ 14.33 --------- --------- --------- --------- --------- Investment operations: Net investment income .............................. 0.27 0.58 0.28 0.48 0.02 Net realized and unrealized gain (loss) ............ 0.10 (0.06) 0.63 (0.33) 0.10 Dividends to preferred shareholders: Net investment income ............................ (0.02) (0.05) (0.02) (0.05) -- Net realized gains on investments ................ -- (0.01) -- -- -- --------- --------- --------- --------- --------- Net increase from investment operations .............. 0.35 0.46 0.89 0.10 0.12 --------- --------- --------- --------- --------- Dividends to common shareholders: Net investment income .............................. (0.22) (0.47) (0.23) (0.49) -- Net realized gains on investments .................. -- (0.08) -- -- -- --------- --------- --------- --------- --------- Total dividends and distributions .................... (0.22) (0.55) (0.23) (0.49) -- --------- --------- --------- --------- --------- Capital charges with respect to issuance of: Common shares ...................................... (0.03) -- (0.03) -- (0.03) Preferred shares ................................... (0.11) (0.01) (0.09) (0.11) -- --------- --------- --------- --------- --------- Total capital charges ................................ (0.14) (0.01) (0.12) (0.11) (0.03) --------- --------- --------- --------- --------- Net asset value, end of period(3)..................... $ 14.32 $ 14.77 $ 14.87 $ 13.92 $ 14.42 ========= ========= ========= ========= ========= Market value, end of period(3)........................ $ 13.97 $ 13.46 $ 14.58 $ 13.60 $ 15.01 ========= ========= ========= ========= ========= TOTAL INVESTMENT RETURN(4)............................ (5.38)% (3.96)% (1.23)% (6.15)% 0.07% ========= ========= ========= ========= ========= RATIOS TO AVERAGE NET ASSETS OF COMMON SHAREHOLDERS:(5,6) Expenses after fee waiver ............................ 0.88% 1.05% 1.12% 0.94% 1.05%(7) Expenses before fee waiver ........................... 1.16% 1.53% 1.53% 1.22% 1.20%(7) Net investment income before preferred share dividends 5.88% 7.95% 5.75% 7.03% 1.35%(7) Preferred share dividends ............................ 0.43% 0.64% 0.49% 0.68% 0.00%(7) Net investment income available to common shareholders ................................ 5.45% 7.31% 5.26% 6.35% 1.35%(7) SUPPLEMENTAL DATA: Average net assets of common shareholders (000) ...... $ 73,656 $ 49,550 $ 47,390 $ 110,772 $ 105,895 Portfolio turnover ................................... 43% 15% 18% 53% 0% Net assets of common shareholders, end of period (000) ................................ $ 75,338 $ 49,492 $ 49,834 $ 110,843 $ 112,576 Preferred shares outstanding (000) ................... $ 46,500 $ 29,975 $ 29,975 $ 71,950 $ -- Asset coverage per preferred share, end of period .... $ 65,508 $ 66,281 $ 66,569 $ 63,515 $ 65,771
- ---------- (1) Commencements of investment operations for the Insured Trusts were October 31, 2002. This information includes the initial investments by BlackRock Funding, Inc. Net asset value immediately after the closing of the public offerings were $14.30. (2) Commencements of investment operations for the Bond Trusts and the Income IITrusts were April 30, 2002, and July 30, 2002, respectively. This information includes the initial investments by BlackRock Funding, Inc. Net asset value immediately after the closing of the public offerings were $14.30. (3) Net asset value and market value are published in BARRON'S on Saturday and THE WALL STREET JOURNAL on Monday. (4) Total investment return is calculated assuming a purchase of a common share at the current market price on the first day and a sale at the current market price on the last day of each period reported. Dividends and distributions, if any, are assumed for purposes of this calculation to be reinvested at prices obtained under each Trust's dividend reinvestment plan. Total investment returns do not reflect brokerage commissions. Total investment returns for less than a full year are not annualized. Past performance is not a guarantee of future results. (5) Ratios are calculated on the basis of income and expenses applicable to both the common and preferred shares relative to the average net assets of the common shareholders. (6) Annualized. (7) These ratios are not indicative of future expense ratios, due to the short operating history of the Income II Trusts. Please refer to each Trust's prospectus for the estimated expense ratios. The information in these Financial Highlights represents the unaudited operating performance for a common share outstanding, total investment returns, ratios to average net assets and other supplemental data for each period indicated. This information has been determined based upon financial information provided in the financial statements and market value data for each Trust's common shares. See Notes to Financial Statements 53
FLORIDA INSURED MUNICIPAL FLORIDA MARYLAND NEW JERSEY INCOME TRUST MUNICIPAL BOND TRUST MUNICIPAL BOND TRUST MUNICIPAL BOND TRUST - ------------ -------------------------- -------------------------- -------------------------- 2003 2003 2002 2003 2002 2003 2002 - ----------- ----------- ----------- ----------- ----------- ----------- ----------- $ 14.33 $ 14.90 $ 14.33 $ 14.76 $ 14.33 $ 14.58 $ 14.33 - ----------- ----------- ----------- ----------- ----------- ----------- ----------- 0.25 0.57 0.26 0.54 0.25 0.57 0.25 0.29 0.31 0.68 0.28 0.53 (0.16) 0.37 (0.02) (0.05) (0.02) (0.05) (0.03) (0.04) (0.02) -- (0.01) -- (0.01) -- (0.01) -- - ----------- ----------- ----------- ----------- ----------- ----------- ----------- 0.52 0.82 0.92 0.76 0.75 0.36 0.60 - ----------- ----------- ----------- ----------- ----------- ----------- ----------- (0.22) (0.46) (0.23) (0.42) (0.21) (0.46) (0.23) -- (0.06) -- (0.04) -- (0.06) -- - ----------- ----------- ----------- ----------- ----------- ----------- ----------- (0.22) (0.52) (0.23) (0.46) (0.21) (0.52) (0.23) - ----------- ----------- ----------- ----------- ----------- ----------- ----------- (0.03) -- (0.03) -- (0.02) -- (0.03) (0.10) (0.01) (0.09) (0.03) (0.09) (0.02) (0.09) - ----------- ----------- ----------- ----------- ----------- ----------- ----------- (0.13) (0.01) (0.12) (0.03) (0.11) (0.02) (0.12) - ----------- ----------- ----------- ----------- ----------- ----------- ----------- $ 14.50 $ 15.19 $ 14.90 $ 15.03 $ 14.76 $ 14.40 $ 14.58 =========== =========== =========== =========== =========== =========== =========== $ 14.34 $ 14.32 $ 14.92 $ 14.55 $ 14.95 $ 13.75 $ 14.65 =========== =========== =========== =========== =========== =========== =========== (2.90)% (0.60)% 1.03% 0.39% 1.10% (2.56)% (0.75)% =========== =========== =========== =========== =========== =========== =========== 0.79% 1.05% 1.12% 1.14% 1.12% 1.12% 1.15% 1.07% 1.53% 1.54% 1.62% 1.54% 1.61% 1.57% 5.33% 7.63% 5.36% 7.29% 5.30% 8.00% 5.29% 0.46% 0.62% 0.49% 0.74% 0.54% 0.61% 0.45% 4.87% 7.01% 4.87% 6.55% 4.76% 7.39% 4.84% $ 121,157 $ 49,541 $ 46,792 $ 29,856 $ 28,153 $ 32,617 $ 31,611 47% 12% 0% 11% 1% 13% 17% $ 126,347 $ 50,259 $ 49,284 $ 30,267 $ 29,705 $ 32,593 $ 32,981 $ 76,000 $ 29,775 $ 29,775 $ 18,000 $ 18,000 $ 20,225 $ 20,225 $ 66,564 $ 67,200 $ 66,383 $ 67,038 $ 66,259 $ 65,290 $ 65,771
54 FINANCIAL HIGHLIGHTS FOR THE PERIOD(1) ENDED FEBRUARY 28, 2003 (UNAUDITED), AND FOR THE PERIOD(2) ENDED AUGUST 31, 2002 - --------------------------------------------------------------------------------
NEW YORK INSURED MUNICIPAL NEW YORK NEW YORK INCOME TRUST MUNICIPAL BOND TRUST MUNICIPAL INCOME TRUST II ------------ ------------------------- ------------------------- 2003 2003 2002 2003 2002 ---------- ---------- ---------- ---------- ---------- PER COMMON SHARE OPERATING PERFORMANCE: Net asset value, beginning of period(3)............... $ 14.33 14.83 $ 14.33 $ 14.47 $ 14.33 ---------- ---------- ---------- ---------- ---------- Investment operations: Net investment income .............................. 0.25 0.56 0.25 0.46 0.02 Net realized and unrealized gain ................... 0.25 0.10 0.62 0.01 0.15 Dividends to preferred shareholders: Net investment income ............................ (0.02) (0.05) (0.02) (0.05) -- Net realized gains on investments ................ -- (0.01) -- -- -- ---------- ---------- ---------- ---------- ---------- Net increase from investment operations .............. 0.48 0.60 0.85 0.42 0.17 ---------- ---------- ---------- ---------- ---------- Dividends to common shareholders: Net investment income .............................. (0.22) (0.46) (0.23) (0.47) -- Net realized gains on investments .................. -- (0.06) -- -- -- ---------- ---------- ---------- ---------- ---------- Total dividends and distributions .................... (0.22) (0.52) (0.23) (0.47) -- ---------- ---------- ---------- ---------- ---------- Capital charges with respect to issuance of: Common shares ...................................... (0.03) -- (0.03) -- (0.03) Preferred shares ................................... (0.11) (0.01) (0.09) (0.12) -- ---------- ---------- ---------- ---------- ---------- Total capital charges ................................ (0.14) (0.01) (0.12) (0.12) (0.03) ---------- ---------- ---------- ---------- ---------- Net asset value, end of period(3)..................... $ 14.45 $ 14.90 $ 14.83 $ 14.30 $ 14.47 ========== ========== ========== ========== ========== Market value, end of period(3)........................ $ 14.42 $ 13.38 $ 14.50 $ 13.45 $ 15.10 ========== ========== ========== ========== ========== TOTAL INVESTMENT RETURN(4)............................ (2.32)% (4.26)% (1.78)% (7.80)% 0.67% ========== ========== ========== ========== ========== RATIOS TO AVERAGE NET ASSETS OF COMMON SHAREHOLDERS:(5,6) Expenses after fee waiver ............................ 0.84% 1.09% 1.12% 0.99% 1.43%(7) Expenses before fee waiver ........................... 1.12% 1.58% 1.54% 1.26% 1.58%(7) Net investment income before preferred share dividends 5.35% 7.63% 5.24% 6.59% 1.77%(7) Preferred share dividends ............................ 0.47% 0.70% 0.50% 0.73% 0.00%(7) Net investment income available to common shareholders ................................ 4.88% 6.93% 4.74% 5.86% 1.77%(7) SUPPLEMENTAL DATA: Average net assets of common shareholders (000) ...... $ 89,700 $ 40,164 $ 38,183 $ 69,897 $ 64,673 Portfolio turnover ................................... 71% 7% 15% 27% 0% Net assets of common shareholders, end of period (000) ................................ $ 92,609 $ 40,233 $ 40,062 $ 70,553 $ 70,276 Preferred shares outstanding (000) ................... $ 56,000 $ 24,200 $ 24,200 $ 44,650 $ -- Asset coverage per preferred share, end of period .... $ 66,344 $ 66,565 $ 66,390 $ 64,505 $ --
- ---------- (1) Commencements of investment operations for the Insured Trusts were October 31, 2002. This information includes the initial investments by BlackRock Funding, Inc. Net asset value immediately after the closing of the public offerings were $14.30. (2) Commencements of investment operations for the Bond Trusts and the Income IITrusts were April 30, 2002, and July 30, 2002, respectively. This information includes the initial investments by BlackRock Funding, Inc. Net asset value immediately after the closing of the public offerings were $14.30. (3) Net asset value and market value are published in BARRON'S on Saturday and THE WALL STREET JOURNAL on Monday. (4) Total investment return is calculated assuming a purchase of a common share at the current market price on the first day and a sale at the current market price on the last day of each period reported. Dividends and distributions, if any, are assumed for purposes of this calculation to be reinvested at prices obtained under each Trust's dividend reinvestment plan. Total investment returns do not reflect brokerage commissions. Total investment returns for less than a full year are not annualized. Past performance is not a guarantee of future results. (5) Ratios are calculated on the basis of income and expenses applicable to both the common and preferred shares relative to the average net assets of the common shareholders. (6) Annualized. (7) These ratios are not indicative of future expense ratios, due to the short operating history of the Income II Trusts. Please refer to each Trust's prospectus for the estimated expense ratios. The information in these Financial Highlights represents the unaudited operating performance for a common share outstanding, total investment returns, ratios to average net assets and other supplemental data for each period indicated. This information has been determined based upon financial information provided in the financial statements and market value data for each Trust's common shares. See Notes to Financial Statements 55 VIRGINIA MUNICIPAL BOND TRUST - ------------------------- 2003 2002 - ---------- ---------- $ 14.90 $ 14.33 - ---------- ---------- 0.55 0.27 0.45 0.65 (0.04) (0.03) (0.02) -- - ---------- ---------- 0.94 0.89 - ---------- ---------- (0.42) (0.21) (0.10) -- - ---------- ---------- (0.52) (0.21) - ---------- ---------- -- (0.02) (0.04) (0.09) - ---------- ---------- (0.04) (0.11) - ---------- ---------- $ 15.28 $ 14.90 ========== ========== $ 15.05 $ 15.20 ========== ========== 2.53% 2.81% ========== ========== 1.16% 1.12% 1.63% 1.54% 7.34% 5.70% 0.55% 0.54% 6.79% 5.16% $ 22,695 $ 21,321 14% 8% $ 23,156 $ 22,545 $ 13,525 $ 13,525 $ 67,803 $ 66,674 56 NOTES TO FINANCIAL STATEMENTS (UNAUDITED) - -------------------------------------------------------------------------------- NOTE 1. ORGANIZATION & ACCOUNTING POLICIES BlackRock Insured Municipal Income Trust ("Insured Municipal"), BlackRock California Insured Municipal Income Trust ("California Insured"), BlackRock Florida Insured Municipal Income Trust ("Florida Insured"), BlackRock New York Insured Municipal Income Trust ("New York Insured") (collectively the "Insured Trusts"), BlackRock Municipal Bond Trust ("Municipal Bond"), BlackRock California Municipal Bond Trust ("California Bond"), BlackRock Florida Municipal Bond Trust ("Florida Bond"), BlackRock Maryland Municipal Bond Trust ("Maryland Bond"), BlackRock NewJersey Municipal Bond Trust ("New Jersey Bond"), BlackRock New York Municipal Bond Trust ("New York Bond"), BlackRock Virginia Municipal Bond Trust ("Virginia Bond")(collectively the "Bond Trusts"), BlackRock Municipal Income Trust II("Municipal Income II"), BlackRock California Municipal Income Trust II("California Income II") and BlackRock New York Municipal Income Trust II("New York Income II") (collectively the "Income IITrusts")(collectively the "Trusts") are organized as Delaware statutory trusts. The Insured Trusts were organized on August 19, 2002. They had no transactions until October 19, 2002 when each of the Insured Trusts sold 8,028 common shares for $115,001 to BlackRock Funding, Inc. Investment operations for the Insured Trusts commenced on October 31, 2002. Insured Municipal, Municipal Bond and Municipal Income II are registered as diversified closed-end management investment companies under the Investment Company Act of 1940, as amended. California Insured, California Bond, California Income II, Florida Insured, Florida Bond, Maryland Bond, New Jersey Bond, New York Insured, New York Bond, New York Income II and Virginia Bond are registered as non-diversified closed-end management investment companies under the Investment Company Act of 1940, as amended. The ability of issuers of debt securities held by the Trusts to meet their obligations may be affected by economic developments in a state, a specific industry or region. The following is a summary of significant accounting policies followed by the Trusts. SECURITIES VALUATION: Municipal securities (including commitments to purchase such securities on a "when-issued" basis) are valued on the basis of prices provided by dealers or pricing services selected under the supervision of each Trust's Board of Trustees (the "Board"). In determining the value of a particular security, pricing services may use certain information with respect to transactions in such securities, quotations from bond dealers, market transactions in comparable securities and various relationships between securities. A futures contract is valued at the last sale price as of the close of the commodities exchange on which it trades. Short-term investments may be valued at amortized cost. 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, each Trust's Board. SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities transactions are recorded on trade date. Realized and unrealized gains and losses are calculated on the identified cost basis. Each Trust also records interest income on an accrual basis and amortizes premium and accretes discount to interest income on securities purchased using the interest method. SEGREGATION: In cases in which the Investment Company Act of 1940, as amended, and the interpretive positions of the Securities and Exchange Commission ("SEC") require that each Trust segregate assets in connection with certain investments (e.g., when issued securities, reverse repurchase agreements or futures contracts), each Trust will, consistent with certain interpretive letters issued by the SEC, designate on its books and records cash or other liquid debt securities having a market value at least equal to the amount that would otherwise be required to be physically segregated. FEDERAL INCOME TAXES: It is each Trust's intention to continue to be treated as a regulated investment company under the Internal Revenue Code and to distribute sufficient net income to shareholders. For this reason and because substantially all of the gross income of each Trust consists of tax-exempt interest, no Federal income tax provisions are required. DIVIDENDS AND DISTRIBUTIONS: Each 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 5. ESTIMATES: The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. DEFERRED COMPENSATION PLAN: Under the revised deferred compensation plan approved by each Trust's Board, non-interested Trustees may elect to defer receipt of all or a portion of their annual compensation. As of January 1, 2003, the Board elected to require its members to defer a portion of their annual complex compensation pursuant to the plan. Deferred amounts earn an approximate return as though equivalent dollar amounts had been invested in common shares of other BlackRock Trusts selected by the Trustees. The deferred compensation plan is not funded and obligations thereunder represent general unsecured claims against the general assets of the Trust. Each Trust may, however, elect to invest in common shares of those Trusts selected by the Trustees in order to match its deferred compensation obligations. 57 NOTE 2. AGREEMENTS Each Trust has an Investment Management Agreement with BlackRock Advisors, Inc. (the "Advisor"), a wholly owned subsidiary of BlackRock, Inc. BlackRock Financial Management, Inc., a wholly owned subsidiary of BlackRock, Inc., serves as sub-advisor to each Trust. BlackRock, Inc. is an indirect majority owned subsidiary of The PNC Financial Services Group, Inc. The investment management agreement covers both investment advisory and administration services. Each Trust's investment advisory fee paid to the Advisor is computed weekly and payable monthly based on an annual rate, 0.55% for the Insured Trusts and Income II Trusts and 0.65% for the Bond Trusts, of each Trust's average weekly managed assets. "Managed assets" means the total assets of a Trust (including any assets attributable to any preferred shares that may be outstanding) minus the sum of accrued liabilities (other than debt representing financial leverage). The Advisor has voluntarily agreed to waive a portion of the investment advisory fee or other expenses of each Trust. With respect to the Insured Trusts the waiver, as a percentage of managed assets, is as follows: 0.20% for the first 5 years of each Trust's operations, 0.15% in year 6, 0.10% in year 7, and 0.05% in year 8. With respect to the Bond Trusts the waiver, as a percentage of managed assets, is as follows: 0.30% for the first 5 years of each Trust's operations, 0.25% in year 6, 0.20% in year 7, 0.15% in year 8, 0.10% in year 9 and 0.05% in year 10. With respect to the Income II Trusts the waiver, as a percentage of managed assets, is as follows: 0.15% for the first 5 years of each Trust's operations, 0.10% in year 6 through year 7, 0.05% in year 8 through year 10. The investment advisory fee and waiver amount for each Trust for the periods ended February 28, 2003 and August 31, 2002, were as follows: 2003 2002 ------------------------ ------------------------ TRUST ADVISORY FEE WAIVER ADVISORY FEE WAIVER - -------- ------------ -------- ------------ -------- Insured Municipal $ 928,920 $337,789 N/A N/A Municipal Bond 769,471 335,140 $444,125 $204,981 Municipal Income II 1,365,873 372,511 152,741 41,657 California Insured 188,249 68,454 N/A N/A California Bond 256,333 118,308 146,284 67,516 California Income II 476,672 130,002 52,657 14,361 Florida Insured 309,085 112,395 N/A N/A Florida Bond 255,660 117,997 144,686 66,778 Maryland Bond 154,255 71,195 87,170 40,232 New Jersey Bond 170,324 78,611 97,897 45,183 New York Insured 228,525 83,100 N/A N/A New York Bond 207,462 95,752 117,932 54,430 New York Income II 298,960 81,535 32,159 8,771 Virginia Bond 116,749 53,884 65,868 30,401 Pursuant to the agreements, the Advisor provides continuous supervision of the investment portfolio and pays the compensation of officers of each Trust who are affiliated persons of the Advisor, occupancy and certain clerical and accounting costs of each Trust. Each Trust bears all other costs and expenses, which include reimbursements to the Advisor for certain operational support services provided to each Trust. Pursuant to the terms of their custody agreements, Municipal Bond, Municipal Income II, California Income II and New York Income II received earnings credits from its custodian for positive cash balances maintained, which are used to offset custody fees, in the amounts of $10,919, $17,589, $21,453 and $13,602, respectively. NOTE 3. PORTFOLIO SECURITIES Purchases and sales of investment securities, other than short-term investments, for the period ended February 28, 2003, were as follows:
TRUST PURCHASES SALES TRUST PURCHASES SALES - -------- ------------ ------------ ------- ----------- ----------- Insured Municipal $747,395,774 $159,334,194 Florida Bond $ 9,370,383 $ 9,537,336 Municipal Bond 11,196,335 16,349,151 Maryland Bond 5,384,305 5,569,550 Municipal Income II 485,023,008 280,767,378 New Jersey Bond 6,828,118 7,914,663 California Insured 160,652,241 42,511,753 New York Insured 216,416,872 73,193,229 California Bond 11,735,975 12,079,010 New York Bond 4,927,250 4,692,700 California Income II 181,261,481 85,525,200 New York Income II 77,633,808 27,329,290 Florida Insured 264,822,066 66,873,256 Virginia Bond 4,911,845 5,154,665
58 At February 28, 2003, the total cost of securities for Federal income tax purposes and the aggregate gross unrealized appreciation and depreciation for securities held by each Trust were as follows:
TRUST COST APPRECIATION DEPRECIATION NET - -------- ------------ ------------ ------------ ---------- Insured Municipal $595,175,072 $9,602,409 $2,196,034 $7,406,375 Municipal Bond 231,862,926 8,250,132 2,775,496 5,474,636 Municipal Income II 528,061,527 9,229,625 6,968,673 2,260,952 California Insured 124,464,070 1,747,630 1,315,807 431,823 California Bond 76,880,495 2,715,236 1,118,150 1,597,086 California Income II 180,007,507 3,011,463 2,246,805 764,658 Florida Insured 198,560,973 2,216,825 -- 2,216,825 Florida Bond 75,990,317 3,005,233 -- 3,005,233 Maryland Bond 46,047,556 1,621,903 -- 1,621,903 New Jersey Bond 50,516,413 1,331,406 1,002,411 328,995 New York Insured 143,209,528 1,763,120 92,355 1,670,765 New York Bond 61,320,740 1,996,135 -- 1,996,135 New York Income II 112,038,840 1,696,527 330,782 1,365,745 Virginia Bond 34,685,123 1,550,133 24,795 1,525,338
NOTE 4. CAPITAL There are an unlimited number of $0.001 par value common shares of beneficial interest authorized for each Trust. Each Trust may classify or reclassify any unissued common shares into one or more series of preferred shares. At February 28, 2003, the shares outstanding and the shares owned by affiliates of the Advisor of each Trust were as follows:
COMMON COMMON SHARES COMMON SHARES COMMON TRUST OUTSTANDING SHARES OWNED TRUST OUTSTANDING SHARES OWNED - -------- ----------- ------------ -------- ------------ ------------ Insured Municipal 26,077,512 7,667 Florida Bond 3,309,483 7,679 Municipal Bond 10,123,055 7,679 Maryland Bond 2,013,427 7,679 Municipal Income II 22,758,028 8,028 New Jersey Bond 2,264,170 7,679 California Insured 5,261,197 7,667 New York Insured 6,408,028 7,667 California Bond 3,351,150 7,679 New York Bond 2,700,991 7,679 California Income II 7,962,244 8,028 New York Income II 4,933,028 8,028 Florida Insured 8,711,027 7,667 Virginia Bond 1,515,507 7,679
Transactions in common shares of beneficial interest from October 31, 2002 (commencement of investment operations) through February 28, 2003, for the Insured Trusts, were as follows:
SHARES FROM ----------------------------------------------------------------- INITIAL UNDERWRITERS' EXERCISING REINVESTMENT NET INCREASE IN TRUST PUBLIC OFFERING THE OVER-ALLOTMENT OPTION OF DIVIDENDS SHARES OUTSTANDING - ------- --------------- ------------------------- ------------ ------------------ Insured Municipal 24,008,028 2,000,000 69,484 26,077,512 California Insured 5,008,028 250,000 3,169 5,261,197 Florida Insured 8,008,028 700,000 2,999 8,711,027 New York Insured 6,008,028 400,000 -- 6,408,028
Offering costs incurred in connection with the Insured Trusts' offering of common shares have been charged to paid-in capital in excess of par of the common shares as follows: TRUST OFFERING COST TRUST OFFERING COST - -------- ------------- -------- ------------- Insured Municipal $765,000 Florida Insured $246,000 California Insured 142,500 New York Insured 177,000 59 On September 19, 2002, each of the Income II Trusts reclassified common shares of beneficial interest and issued several series of Auction Market Preferred Shares ("preferred shares") listed in the table below. The preferred shares have a liquidation value of $25,000 per share plus any accumulated unpaid dividends.
TRUST SERIES SHARES TRUST SERIES SHARES - -------- ------ ------ -------- ------ ------ Municipal Income II M7 2,055 California Income II T7 1,439 T7 2,056 R7 1,439 W7 2,055 New York Income II W7 1,786 R7 2,056
Underwriting discounts and offering costs incurred in connection with the preferred share offering have been charged to paid-in capital in excess of par of the common shares.
UNDERWRITING OFFERING UNDERWRITING OFFERING TRUST DISCOUNT COST TRUST DISCOUNT COST - -------- ------------ --------- -------- ------------ -------- Municipal Income II $2,055,500 $316,954 New York Income II $446,500 $99,639 California Income II 719,500 125,210
On December 11, 2002, the Insured Trusts reclassified common shares of beneficial interest and issued several series of preferred shares listed in the table below. The preferred shares have a liquidation value of $25,000 per share plus any accumulated unpaid dividends.
TRUST AND SERIES SHARES TRUST AND SERIES SHARES - ----------------- ------ --------------------- ------ Insured Municipal California Insured-F7 1,860 M7 3,053 Florida Insured-M7 3,040 R7 3,053 New York Insured-R7 2,240 F7 3,053
Underwriting discounts and offering costs incurred in connection with the preferred share offering have been charged to paid-in capital in excess of par of the common shares.
UNDERWRITING OFFERING UNDERWRITING OFFERING TRUST DISCOUNT COST TRUST DISCOUNT COST - -------- ------------ ---------- -------- ------------ --------- Insured Municipal $2,289,750 $415,123 Florida Insured $760,000 $150,998 California Insured 465,000 113,925 New York Insured 560,000 124,125
As of February 28, 2003, the Bond Trusts had the following series of preferred shares outstanding as listed in the table below. The preferred shares have a liquidation value of $25,000 per share plus any accumulated unpaid dividends.
TRUST AND SERIES SHARES TRUST AND SERIES SHARES - ---------------- ------ ------------------ ------ Municipal Bond Maryland Bond-R7 720 T7 1,810 New Jersey Bond-M7 809 R7 1,810 New York Bond-T7 968 California Bond-F7 1,199 Virginia Bond-R7 541 Florida Bond-W7 1,191
Dividends on seven-day preferred shares are cumulative at a rate which is reset every seven days based on the results of an auction. The dividend ranges on the preferred shares for each of the Trusts for the period ended February 28, 2003, were as follows:
TRUST LOW HIGH TRUST LOW HIGH - -------- ----- ----- -------- ----- ------ Insured Municipal 1.05% 1.70% Florida Bond 0.24% 1.68% Municipal Bond 0.95 3.69 Maryland Bond 0.60 2.80 Municipal Income II 0.94 1.75 New Jersey Bond 0.79 2.50 California Insured 0.79 1.20 New York Insured 1.05 1.50 California Bond 0.70 2.98 New York Bond 1.00 2.48 California Income II 0.70 1.73 New York Income II 0.86 1.75 Florida Insured 0.94 1.38 Virginia Bond 0.64 2.80
A Trust may not declare dividends or make other distributions on common shares or purchase any such shares if, at the time of the declaration, distribution or purchase, asset coverage with respect to the outstanding preferred shares would be less than 200%. The preferred shares are redeemable at the option of each Trust, in whole or in part, on any dividend payment date at $25,000 per share plus any accumulated or unpaid dividends whether or not declared. The preferred shares are also subject to mandatory redemption at $25,000 60 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 a Trust, as set forth in each Trust's Declaration of Trust, are not satisfied. The holders of preferred shares have voting rights equal to the holders of common shares (one vote per share) and will vote together with holders of common shares as a single class. However, holders of preferred shares are also entitled to elect two Trustees for each Trust. In addition, the Investment Company Act of 1940 requires that along with approval by shareholders 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 a Trust's sub-classification as a closed-end investment company or changes in its fundamental investment restrictions. NOTE 5. DIVIDENDS Subsequent to February 28, 2003, the Board of each Trust declared dividends from undistributed earnings per common share payable April 1, 2003, to shareholders of record on March 14, 2003. The per share common dividends declared were as follows: COMMON DIVIDEND COMMON DIVIDEND TRUST PER SHARE TRUST PER SHARE - -------- --------------- -------- --------------- Insured Municipal $0.078125 Florida Bond $0.076250 Municipal Bond 0.084375 Maryland Bond 0.070000 Municipal Income II 0.083750 New Jersey Bond 0.077500 California Insured 0.075000 New York Insured 0.075000 California Bond 0.078125 New York Bond 0.076250 California Income II 0.081250 New York Income II 0.078750 Florida Insured 0.075000 Virginia Bond 0.070625 The dividends declared on preferred shares for the period March 1, 2003 to March 31, 2003, for each of the Trusts were as follows: DIVIDENDS DIVIDENDS TRUST AND SERIES DECLARED TRUST AND SERIES DECLARED - --------------------- --------- -------------------- --------- Insured Municipal California Bond-F7 $27,829 M7 $61,579 California Income II R7 58,679 T7 27,715 F7 76,081 R7 28,003 Municipal Bond Florida Insured-M7 61,347 T7 34,951 Florida Bond-W7 22,712 R7 34,607 Maryland Bond-R7 13,622 Municipal Income II New Jersey Bond-M7 13,923 M7 40,011 New York Insured-R7 42,918 T7 39,393 New York Bond-T7 16,650 W7 40,853 New York Income II-W7 34,648 R7 40,791 Virginia Bond-R7 8,948 California Insured-F7 44,287 61 DIVIDEND REINVESTMENT PLANS - -------------------------------------------------------------------------------- Pursuant to each Trust's Dividend Reinvestment Plan (the "Plan"), common shareholders are automatically enrolled to have all distributions of dividends and capital gains reinvested by EquiServe Trust Company, N.A. (the "Plan Agent") in the respective Trust's shares pursuant to the Plan. Shareholders who elect not to participate in the Plan will receive all distributions in cash paid by check and 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 Plan Agent. The Plan Agent serves as agent for the shareholders in administering the Plan. After a Trust declares a dividend or determines to make a capital gain distribution, the Plan Agent will acquire shares for the participants' accounts, depending upon the circumstances described below, either (i) through receipt of unissued but authorized shares from the Trust ("newly issued shares") or (ii) by purchase of outstanding shares on the open market, on the Trust's primary exchange or elsewhere ("open-market purchases"). If, on the dividend payment date, the net asset value per share ("NAV") is equal to or less than the market price per share plus estimated brokerage commissions (such condition being referred to herein as "market premium"), the Plan Agent will invest the dividend amount in newly issued shares on behalf of the participants. The number of newly issued shares to be credited to each participant's account will be determined by dividing the dollar amount of the dividend by the NAV on the date the shares are issued. However, if the NAV is less than 95% of the market price on the payment date, the dollar amount of the dividend will be divided by 95% of the market price on the payment date. If, on the dividend payment date, the NAV is greater than the market value per share plus estimated brokerage commissions (such condition being referred to herein as "market discount"), the Plan Agent will invest the dividend amount in shares acquired on behalf of the participants in open-market purchases. 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 each Trust. However, each participant will pay a pro rata share of brokerage commissions incurred with respect to the Plan Agent's open market purchases in connection with the reinvestment of dividends and distributions. The automatic reinvestment of dividends and distributions will not relieve participants of any Federal income tax that may be payable on such dividends or distributions. Each Trust reserves the right to amend or terminate the Plan. There is no direct service charge to participants in the Plan, however, each Trust reserves the right to amend the Plan to include a service charge payable by the participants. All correspondence concerning the Plan should be directed to the Plan Agent at (800) 699-1BFM or 150 Royall Street, Canton, MA 02021. 62 INVESTMENT SUMMARIES - -------------------------------------------------------------------------------- WHO MANAGES THE TRUSTS? BlackRock Advisors, Inc. (the "Advisor") manages the Trusts. The Advisor is a wholly owned subsidiary of BlackRock, Inc. ("BlackRock"), which is one of the largest publicly traded investment management firms in the United States with $273 billion of assets under management as of December 31, 2002. BlackRock manages assets on behalf of institutional and individual investors worldwide through a variety of equity, fixed income, liquidity and alternative investment products. In addition, BlackRock provides risk management and investment system services to a growing number of institutional investors under the BLACKROCK SOLUTIONS name. Clients are served from the company's headquarters in New York City, as well as offices in Boston, Edinburgh, Hong Kong, San Francisco, Tokyo and Wilmington. BlackRock is majority owned by The PNC Financial Services Group, Inc. (NYSE: PNC), and by BlackRock employees. HOW ARE THE TRUSTS' SHARES PURCHASED AND SOLD? DOES THE TRUST PAY DIVIDENDS REGULARLY? The Trusts' common shares are traded on either the New York Stock Exchange ("NYSE") or the American Stock Exchange ("AMEX"), both of which provide investors with liquidity on a daily basis. Orders to buy or sell shares of the Trusts must be placed through a registered broker or financial advisor. The Trusts pay monthly dividends which are typically paid on the first business day of the month. For shares held in the shareholder's name, dividends may be reinvested in additional shares of the respective Trust through its transfer agent, EquiServe Trust Company, N.A. 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 TRUSTS The Trusts employ leverage primarily through the issuance of preferred shares. Leverage permits the Trusts to borrow money at short-term rates and reinvest that money in longer-term assets, which typically offer higher interest rates. The difference between the cost of the borrowed funds and the income earned on the proceeds that are invested in longer-term assets is the potential benefit to the Trusts from leverage. Leverage increases the duration (or price sensitivity of the net assets with respect to changes in interest rates) of the Trusts, which can improve the performance of the Trusts in a declining interest rate environment, but can cause net assets to decline faster in a rapidly rising interest rate environment. The Advisor's portfolio managers continuously monitor and regularly review each Trust's use of leverage and may reduce, or unwind, the amount of leverage employed should the Advisor consider that reduction to be in the best interests of the shareholders. SPECIAL CONSIDERATIONS AND RISK FACTORS RELEVANT TO THE TRUSTS The Trusts are intended to be long-term investments and are not short-term trading vehicles. DIVIDEND CONSIDERATIONS. The income and dividends paid by the Trusts are likely to vary over time as fixed income market conditions change. Future dividends may be higher or lower than the dividends the Trusts are currently paying. LEVERAGE. The Trusts utilize leverage through the issuance of preferred shares, which involves special risks. The Trusts' NAV and market value may be more volatile due to the use of leverage. MARKET PRICE OF SHARES. The shares of closed-end investment companies such as the Trusts trade on the NYSE or the AMEX and as such are subject to supply and demand influences. As a result, shares may trade at a discount or a premium to their NAV. 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 a Trust have, a Trust may be subject to certain reinvestment risks in environments of declining interest rates. HIGH YIELD RISK. The Trusts, except the Insured Trusts, may invest in high yield bonds, which involves additional risks, including credit risk. The value of high yield, lower quality bonds is affected by the creditworthiness of the issuers of the securities and by general economic and specific industry conditions. Issuers of high yield bonds are not as strong financially as those with higher credit ratings. A Trust's investment in lower grade securities will expose the Trust to greater risk than if the Trust owned only higher grade securities. ILLIQUID SECURITIES. The Trusts may invest in securities that are illiquid, although under current market conditions the Trusts expect to do so to only a limited extent. These securities involve special risks. ANTITAKEOVER PROVISIONS. Certain antitakeover provisions will make a change in a Trust's business or management more difficult without the approval of a Trust's Board and may have the effect of depriving shareholders of an opportunity to sell their shares at a premium above the prevailing market price. ALTERNATIVE MINIMUM TAX (AMT). The Trusts, except the Insured Trusts, may invest in securities subject to alternative minimum tax. 63 - ---------------------------------------- BLACKROCK INSURED MUNICIPAL INCOME TRUST - ---------------------------------------- INVESTMENT OBJECTIVE The Trust's investment objective is to provide current income exempt from Federal income tax, including the alternative minimum tax. WHAT CAN THE TRUST INVEST IN? The Trust invests primarily in insured municipal bonds that pay interest that is exempt from Federal income tax, including the alternative minimum tax. Under normal market conditions, the Trust manages its assets so that at the time of investment, at least 80% of its investments are rated in the highest category (AAA by S&P or Fitch or Aaa by Moody's) or, if unrated, determined to be of comparable quality by the Advisor. Up to 20% of the Trust's assets may be invested in bonds rated below AAA or Aaa (but not lower than BBB or Baa), and comparable unrated municipal bonds and/or municipal bonds that are uninsured. The Trust does not intend to invest any of its assets in municipal bonds rated below investment grade or in comparable unrated municipal bonds. WHAT IS THE ADVISOR'S INVESTMENT STRATEGY? The Advisor manages the assets of the Trust in accordance with the Trust's investment objective and policies by investing primarily in insured municipal bonds that pay interest that is exempt from Federal income tax, including alternative minimum tax. The Trust will not invest in a municipal bond if the interest on that bond is subject to the alternative minimum tax. The Advisor actively manages the assets in relation to market conditions and interest rate changes. The Trust intends to invest primarily in long-term bonds and expects bonds in its portfolio to have a dollar weighted average maturity of 15 years or more, but the average maturity may be shortened or lengthened from time to time depending on market conditions. The Trust employs leverage primarily through the issuance of preferred shares. Preferred shareholders 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. The difference between the cost of the dividends paid to preferred shareholders and the interest earned on the longer-term securities will provide higher income levels for common shareholders in most interest rate environments. See "Leverage Considerations in the Trusts". - ------------------------------ BLACKROCK MUNICIPAL BOND TRUST - ------------------------------ INVESTMENT OBJECTIVE The Trust's investment objective is to provide current income exempt from regular Federal income tax. WHAT CAN THE TRUST INVEST IN? Under normal conditions, the Trust manages its assets so that at the time of investment, at least 80% of its investments are rated at least investment grade (BBB by S&P or Fitch or Baa by Moody's) or, if unrated, determined to be of comparable quality by the Advisor. Up to 20% of the Trust's assets may be invested in bonds rated below investment grade (Ba/BB or B) or, if unrated, determined to be of comparable quality by the Advisor. The Trust invests primarily all of the assets in a portfolio of municipal obligations, which include debt obligations issued by the United States, 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 Federal income taxes. WHAT IS THE ADVISOR'S INVESTMENT STRATEGY? The Advisor manages the assets of the Trust in accordance with the Trust's investment objective and policies by investing primarily in municipal bonds that pay interest that is exempt from regular Federal income tax. The Advisor actively manages the assets in relation to market conditions and interest rate changes. Depending on yield and portfolio allocation considerations, the Advisor may choose to invest a portion of the Trust's assets in securities which pay interest that is subject to AMT. The Trust intends to invest primarily in long-term bonds and expects bonds in its portfolio to have a dollar weighted average maturity of 15 years or more, but the average maturity may be shortened or lengthened from time to time depending on market conditions. The Trust employs leverage primarily through the issuance of preferred shares. Preferred shareholders 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. The difference between the cost of the dividends paid to preferred shareholders and the interest earned on the longer-term securities will provide higher income levels for common shareholders in most interest rate environments. See "Leverage Considerations in the Trusts". 64 - ----------------------------------- BLACKROCK MUNICIPAL INCOME TRUST II - ----------------------------------- INVESTMENT OBJECTIVE The Trust's investment objective is to provide current income exempt from regular Federal income tax. WHAT CAN THE TRUST INVEST IN? Under normal conditions, the Trust manages its assets so that at the time of investment, at least 80% of its investments are rated at least investment grade (BBB by S&P or Fitch or Baa by Moody's) or, if unrated, determined to be of comparable quality by the Advisor. Up to 20% of the Trust's assets may be invested in bonds rated below investment grade (Ba/BB or B) or, if unrated, determined to be of comparable quality by the Advisor. The Trust invests primarily all of the assets in a portfolio of municipal obligations, which include debt obligations issued by the United States, 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 Federal income taxes. WHAT IS THE ADVISOR'S INVESTMENT STRATEGY? The Advisor manages the assets of the Trust in accordance with the Trust's investment objective and policies by investing primarily in municipal bonds that pay interest that is exempt from regular Federal income tax. The Advisor actively manages the assets in relation to market conditions and interest rate changes. Depending on yield and portfolio allocation considerations, the Advisor may choose to invest a portion of the Trust's assets in securities which pay interest that is subject to AMT. The Trust intends to invest primarily in long-term bonds and expects bonds in its portfolio to have a dollar weighted average maturity of 15 years or more, but the average maturity may be shortened or lengthened from time to time depending on market conditions. The Trust employs leverage primarily through the issuance of preferred shares. Preferred shareholders 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. The difference between the cost of the dividends paid to preferred shareholders and the interest earned on the longer-term securities will provide higher income levels for common shareholders in most interest rate environments. See "Leverage Considerations in the Trusts". - --------------------------------------------------- BLACKROCK CALIFORNIA INSURED MUNICIPAL INCOME TRUST - --------------------------------------------------- INVESTMENT OBJECTIVE The Trust's investment objective is to provide current income exempt from Federal income tax, including the alternative minimum tax, and California income tax. WHAT CAN THE TRUST INVEST IN? The Trust invests primarily in insured municipal bonds that pay interest that is exempt from Federal income tax, including the alternative minimum tax, and California income tax. Under normal market conditions, the Trust manages its assets so that at the time of investment, at least 80% of its investments are rated in the highest category (AAA by S&P or Fitch or Aaa by Moody's) or, if unrated, determined to be of comparable quality by the Advisor. Up to 20% of the Trust's assets may be invested in bonds rated below AAA or Aaa (but not lower than BBB or Baa), and comparable unrated municipal bonds and/or municipal bonds that are uninsured. The Trust does not intend to invest any of its assets in municipal bonds rated below investment grade or in comparable unrated municipal bonds. WHAT IS THE ADVISOR'S INVESTMENT STRATEGY? The Advisor manages the assets of the Trust in accordance with the Trust's investment objective and policies by investing primarily in insured municipal bonds that pay interest that is exempt from Federal income tax, including alternative minimum tax, and California income tax. The Trust will not invest in a municipal bond if the interest on that bond is subject to the alternative minimum tax. The Advisor actively manages the assets in relation to market conditions and interest rate changes. The Trust intends to invest primarily in long-term bonds and expects bonds in its portfolio to have a dollar weighted average maturity of 15 years or more, but the average maturity may be shortened or lengthened from time to time depending on market conditions. The Trust employs leverage primarily through the issuance of preferred shares. Preferred shareholders 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. The difference between the cost of the dividends paid to preferred shareholders and the interest earned on the longer-term securities will provide higher income levels for common shareholders in most interest rate environments. See "Leverage Considerations in the Trusts". 65 - ----------------------------------------- BLACKROCK CALIFORNIA MUNICIPAL BOND TRUST - ----------------------------------------- INVESTMENT OBJECTIVE The Trust's investment objective is to provide current income exempt from regular Federal income tax and California income tax. WHAT CAN THE TRUST INVEST IN? Under normal conditions, the Trust manages its assets so that at the time of investment, at least 80% of its investments are rated at least investment grade (BBB by S&P or Fitch or Baa by Moody's) or, if unrated, determined to be of comparable quality by the Advisor. Up to 20% of the Trust's assets may be invested in bonds rated below investment grade (Ba/BB or B) or, if unrated, determined to be of comparable quality by the Advisor. The Trust invests primarily all of the assets in a portfolio of California municipal obligations, which include debt obligations issued by the state 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 Federal income tax and California income tax. WHAT IS THE ADVISOR'S INVESTMENT STRATEGY? The Advisor manages the assets of the Trust in accordance with the Trust's investment objective and policies by investing primarily in municipal bonds that pay interest that is exempt from regular Federal income tax and California income tax. The Advisor actively manages the assets in relation to market conditions and interest rate changes. Depending on yield and portfolio allocation considerations, the Advisor may choose to invest a portion of the Trust's assets in securities which pay interest that is subject to AMT. The Trust intends to invest primarily in long-term bonds and expects bonds in its portfolio to have a dollar weighted average maturity of 15 years or more, but the average maturity may be shortened or lengthened from time to time depending on market conditions. The Trust employs leverage primarily through the issuance of preferred shares. Preferred shareholders 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. The difference between the cost of the dividends paid to preferred shareholders and the interest earned on the longer-term securities will provide higher income levels for common shareholders in most interest rate environments. See "Leverage Considerations in the Trusts". - ---------------------------------------------- BLACKROCK CALIFORNIA MUNICIPAL INCOME TRUST II - ---------------------------------------------- INVESTMENT OBJECTIVE The Trust's investment objective is to provide current income exempt from regular Federal income tax and California income tax. WHAT CAN THE TRUST INVEST IN? Under normal conditions, the Trust manages its assets so that at the time of investment, at least 80% of its investments are rated at least investment grade (BBB by S&P or Fitch or Baa by Moody's) or, if unrated, determined to be of comparable quality by the Advisor. Up to 20% of the Trust's assets may be invested in bonds rated below investment grade (Ba/BB or B), or if unrated, determined to be of comparable quality by the Advisor. The Trust invests primarily all of the assets in a portfolio of California municipal obligations, which include debt obligations issued by the state 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 Federal income tax and California income tax. WHAT IS THE ADVISOR'S INVESTMENT STRATEGY? The Advisor manages the assets of the Trust in accordance with the Trust's investment objective and policies by investing primarily in municipal bonds that pay interest that is exempt from regular Federal income tax and California income tax. The Advisor actively manages the assets in relation to market conditions and interest rate changes. Depending on yield and portfolio allocation considerations, the Advisor may choose to invest a portion of the Trust's assets in securities which pay interest that is subject to AMT. The Trust intends to invest primarily in long-term bonds and expects bonds in its portfolio to have a dollar weighted average maturity of 15 years or more, but the average maturity may be shortened or lengthened from time to time depending on market conditions. The Trust employs leverage primarily through the issuance of preferred shares. Preferred shareholders 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. The difference between the cost of the dividends paid to preferred shareholders and the interest earned on the longer-term securities will provide higher income levels for common shareholders in most interest rate environments. See "Leverage Considerations in the Trusts". 66 - ------------------------------------------------ BLACKROCK FLORIDA INSURED MUNICIPAL INCOME TRUST - ------------------------------------------------ INVESTMENT OBJECTIVE The Trust's investment objective is to provide current income exempt from Federal income tax, including the alternative minimum tax, and Florida intangible personal property tax. WHAT CAN THE TRUST INVEST IN? The Trust invests primarily in insured municipal bonds that pay interest that is exempt from Federal income tax, including the alternative minimum tax, and Florida intangible personal property tax. Under normal market conditions, the Trust manages its assets so that at the time of investment, at least 80% of its investments are rated in the highest category (AAA by S&P or Fitch or Aaa by Moody's) or, if unrated, determined to be of comparable quality by the Advisor. Up to 20% of the Trust's assets may be invested in bonds rated below AAA or Aaa (but not lower than BBB or Baa), and comparable unrated municipal bonds and/or municipal bonds that are uninsured. The Trust does not intend to invest any of its assets in municipal bonds rated below investment grade or in comparable unrated municipal bonds. WHAT IS THE ADVISOR'S INVESTMENT STRATEGY? The Advisor manages the assets of the Trust in accordance with the Trust's investment objective and policies by investing primarily in insured municipal bonds that pay interest that is exempt from Federal income tax, including alternative minimum tax, and Florida intangible personal property tax. The Trust will not invest in a municipal bond if the interest on that bond is subject to the alternative minimum tax. The Advisor actively manages the assets in relation to market conditions and interest rate changes. The Trust intends to invest primarily in long-term bonds and expects bonds in its portfolio to have a dollar weighted average maturity of 15 years or more, but the average maturity may be shortened or lengthened from time to time depending on market conditions. The Trust employs leverage primarily through the issuance of preferred shares. Preferred shareholders 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. The difference between the cost of the dividends paid to preferred shareholders and the interest earned on the longer-term securities will provide higher income levels for common shareholders in most interest rate environments. See "Leverage Considerations in the Trusts". - -------------------------------------- BLACKROCK FLORIDA MUNICIPAL BOND TRUST - -------------------------------------- INVESTMENT OBJECTIVE The Trust's investment objective is to provide current income exempt from regular Federal income tax and Florida intangible personal property tax. WHAT CAN THE TRUST INVEST IN? Under normal conditions, the Trust manages its assets so that at the time of investment, at least 80% of its investments are rated at least investment grade (BBB by S&P or Fitch or Baa by Moody's) or, if unrated, determined to be of comparable quality by the Advisor. Up to 20% of the Trust's assets may be invested in bonds rated below investment grade (Ba/BB or B) or, if unrated, determined to be of comparable quality by the Advisor. The Trust invests primarily all of the assets in a portfolio of Florida municipal obligations, which include debt obligations issued by the state of Florida, 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 Federal income tax and Florida intangible personal property tax. WHAT IS THE ADVISOR'S INVESTMENT STRATEGY? The Advisor manages the assets of the Trust in accordance with the Trust's investment objective and policies by investing primarily in municipal bonds that pay interest that is exempt from regular Federal income tax and Florida intangible personal property tax. The Advisor actively manages the assets in relation to market conditions and interest rate changes. Depending on yield and portfolio allocation considerations, the Advisor may choose to invest a portion of the Trust's assets in securities which pay interest that is subject to AMT. The Trust intends to invest primarily in long-term bonds and expects bonds in its portfolio to have a dollar weighted average maturity of 15 years or more, but the average maturity may be shortened or lengthened from time to time depending on market conditions. The Trust employs leverage primarily through the issuance of preferred shares. Preferred shareholders 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. The difference between the cost of the dividends paid to preferred shareholders and the interest earned on the longer-term securities will provide higher income levels for common shareholders in most interest rate environments. See "Leverage Considerations in the Trusts". 67 - --------------------------------------- BLACKROCK MARYLAND MUNICIPAL BOND TRUST - --------------------------------------- INVESTMENT OBJECTIVE The Trust's investment objective is to provide current income exempt from regular Federal income tax and Maryland personal income tax. WHAT CAN THE TRUST INVEST IN? Under normal conditions, the Trust manages its assets so that at the time of investment, at least 80% of its investments are rated at least investment grade (BBB by S&P or Fitch or Baa by Moody's) or, if unrated, determined to be of comparable quality by the Advisor. Up to 20% of the Trust's assets may be invested in bonds rated below investment grade (Ba/BB or B), or if unrated, determined to be of comparable quality by the Advisor. The Trust invests primarily all of the assets in a portfolio of Maryland municipal obligations, which include debt obligations issued by the state of Maryland, 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 Federal income tax and Maryland personal income tax. WHAT IS THE ADVISOR'S INVESTMENT STRATEGY? The Advisor manages the assets of the Trust in accordance with the Trust's investment objective and policies by investing primarily in municipal bonds that pay interest that is exempt from regular Federal income tax and Maryland personal income tax. The Advisor actively manages the assets in relation to market conditions and interest rate changes. Depending on yield and portfolio allocation considerations, the Advisor may choose to invest a portion of the Trust's assets in securities which pay interest that is subject to AMT. The Trust intends to invest primarily in long-term bonds and expects bonds in its portfolio to have a dollar weighted average maturity of 15 years or more, but the average maturity may be shortened or lengthened from time to time depending on market conditions. The Trust employs leverage primarily through the issuance of preferred shares. Preferred shareholders 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. The difference between the cost of the dividends paid to preferred shareholders and the interest earned on the longer-term securities will provide higher income levels for common shareholders in most interest rate environments. See "Leverage Considerations in the Trusts". - ----------------------------------------- BLACKROCK NEW JERSEY MUNICIPAL BOND TRUST - ----------------------------------------- INVESTMENT OBJECTIVE The Trust's investment objective is to provide current income exempt from regular Federal income tax and New Jersey gross income tax. WHAT CAN THE TRUST INVEST IN? Under normal conditions, the Trust manages its assets so that at the time of investment, at least 80% of its investments are rated at least investment grade (BBB by S&P or Fitch or Baa by Moody's) or, if unrated, determined to be of comparable quality by the Advisor. Up to 20% of the Trust's assets may be invested in bonds rated below investment grade (Ba/BB or B) or, if unrated, determined to be of comparable quality by the Advisor. The Trust intends to invest primarily all of the assets in a portfolio of New Jersey municipal obligations, which include debt obligations issued by the state of New Jersey, 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 Federal income tax and New Jersey gross income tax. WHAT IS THE ADVISOR'S INVESTMENT STRATEGY? The Advisor manages the assets of the Trust in accordance with the Trust's investment objective and policies to seek to achieve its objective by investing primarily in municipal bonds that pay interest that is exempt from regular Federal income tax and New Jersey gross income tax. The Advisor actively manages the assets in relation to market conditions and interest rate changes. Depending on yield and portfolio allocation considerations, the Advisor may choose to invest a portion of the Trust's assets in securities which pay interest that is subject to AMT. The Trust intends to invest primarily in long-term bonds and expects bonds in its portfolio to have a dollar weighted average maturity of 15 years or more, but the average maturity may be shortened or lengthened from time to time depending on market conditions. The Trust employs leverage primarily through the issuance of preferred shares. Preferred shareholders 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. The difference between the cost of the dividends paid to preferred shareholders and the interest earned on the longer-term securities will provide higher income levels for common shareholders in most interest rate environments. See "Leverage Considerations in the Trusts". 68 - ------------------------------------------------- BLACKROCK NEW YORK INSURED MUNICIPAL INCOME TRUST - ------------------------------------------------- INVESTMENT OBJECTIVE The Trust's investment objective is to provide current income exempt from Federal income tax, including the alternative minimum tax, and New York State and New York City personal income taxes. WHAT CAN THE TRUST INVEST IN? The Trust invests primarily in insured municipal bonds that pay interest that is exempt from Federal income tax, including the alternative minimum tax, and New York State and New York City personal income taxes. Under normal market conditions, the Trust manages its assets so that at the time of investment, at least 80% of its investments are rated in the highest category (AAA by S&P or Fitch or Aaa by Moody's) or, if unrated, determined to be of comparable quality by the Advisor. Up to 20% of the Trust's assets may be invested in bonds rated below AAA or Aaa (but not lower than BBB or Baa), and comparable unrated municipal bonds and/or municipal bonds that are uninsured. The Trust does not intend to invest any of its assets in municipal bonds rated below investment grade or in comparable unrated municipal bonds. WHAT IS THE ADVISOR'S INVESTMENT STRATEGY? The Advisor manages the assets of the Trust in accordance with the Trust's investment objective and policies by investing primarily in insured municipal bonds that pay interest that is exempt from Federal income tax, including alternative minimum tax, and New York State and New York City personal income taxes. The Trust will not invest in a municipal bond if the interest on that bond is subject to the alternative minimum tax. The Advisor actively manages the assets in relation to market conditions and interest rate changes. The Trust intends to invest primarily in long-term bonds and expects bonds in its portfolio to have a dollar weighted average maturity of 15 years or more, but the average maturity may be shortened or lengthened from time to time depending on market conditions. The Trust employs leverage primarily through the issuance of preferred shares. Preferred shareholders 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. The difference between the cost of the dividends paid to preferred shareholders and the interest earned on the longer-term securities will provide higher income levels for common shareholders in most interest rate environments. See "Leverage Considerations in the Trusts". - --------------------------------------- BLACKROCK NEW YORK MUNICIPAL BOND TRUST - --------------------------------------- INVESTMENT OBJECTIVE The Trust's investment objective is to provide current income exempt from regular Federal income tax and New York State and New York City personal income taxes. WHAT CAN THE TRUST INVEST IN? Under normal conditions, the Trust manages its assets so that at the time of investment, at least 80% of its investments are rated at least investment grade (BBB by S&P or Fitch or Baa by Moody's) or, if unrated, determined to be of comparable quality by the Advisor. Up to 20% of the Trust's assets may be invested in bonds rated below investment grade (Ba/BB or B) or, if unrated, determined to be of comparable quality by the Advisor. The Trust invests primarily all of the assets in a portfolio of New York municipal obligations, which include debt obligations issued by the state of New York, 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 Federal income tax and New York State and New York City personal income taxes. WHAT IS THE ADVISOR'S INVESTMENT STRATEGY? The Advisor manages the assets of the Trust in accordance with the Trust's investment objective and policies by investing primarily in municipal bonds that pay interest that is exempt from regular Federal income tax and New York State and New York City personal income taxes. The Advisor actively manages the assets in relation to market conditions and interest rate changes. Depending on yield and portfolio allocation considerations, the Advisor may choose to invest a portion of the Trust's assets in securities which pay interest that is subject to AMT. The Trust intends to invest primarily in long-term bonds and expects bonds in its portfolio to have a dollar weighted average maturity of 15 years or more, but the average maturity may be shortened or lengthened from time to time depending on market conditions. The Trust employs leverage primarily through the issuance of preferred shares. Preferred shareholders 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. The difference between the cost of the dividends paid to preferred shareholders and the interest earned on the longer-term securities will provide higher income levels for common shareholders in most interest rate environments. See "Leverage Considerations in the Trusts". 69 - -------------------------------------------- BLACKROCK NEW YORK MUNICIPAL INCOME TRUST II - -------------------------------------------- INVESTMENT OBJECTIVE The Trust's investment objective is to provide current income exempt from regular Federal income tax and New York State and New York City personal income taxes. WHAT CAN THE TRUST INVEST IN? Under normal conditions, the Trust manages its assets so that at the time of investment, at least 80% of its investments are rated at least investment grade (BBB by S&P or Fitch or Baa by Moody's) or, if unrated, determined to be of comparable quality by the Advisor. Up to 20% of the Trust's assets may be invested in bonds rated below investment grade (Ba/BB or B) or, if unrated, determined to be of comparable quality by the Advisor. The Trust invests primarily all of the assets in a portfolio of New York municipal obligations, which include debt obligations issued by the state of New York, 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 Federal income tax and New York State and New York City personal income taxes. WHAT IS THE ADVISOR'S INVESTMENT STRATEGY? The Advisor manages the assets of the Trust in accordance with the Trust's investment objective and policies by investing primarily in municipal bonds that pay interest that is exempt from regular Federal income tax and New York State and New York City personal income taxes. The Advisor actively manages the assets in relation to market conditions and interest rate changes. Depending on yield and portfolio allocation considerations, the Advisor may choose to invest a portion of the Trust's assets in securities which pay interest that is subject to AMT. The Trust intends to invest primarily in long-term bonds and expects bonds in its portfolio to have a dollar weighted average maturity of 15 years or more, but the average maturity may be shortened or lengthened from time to time depending on market conditions. The Trust employs leverage primarily through the issuance of preferred shares. Preferred shareholders 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. The difference between the cost of the dividends paid to preferred shareholders and the interest earned on the longer-term securities will provide higher income levels for common shareholders in most interest rate environments. See "Leverage Considerations in the Trusts". - --------------------------------------- BLACKROCK VIRGINIA MUNICIPAL BOND TRUST - --------------------------------------- INVESTMENT OBJECTIVE The Trust's investment objective is to provide current income exempt from regular Federal income tax and Virginia personal income tax. WHAT CAN THE TRUST INVEST IN? Under normal conditions, the Trust manages its assets so that at the time of investment, at least 80% of its investments are rated at least investment grade (BBB by S&P or Fitch or Baa by Moody's) or, if unrated, determined to be of comparable quality by the Advisor. Up to 20% of the Trust's assets may be invested in bonds rated below investment grade (Ba/BB or B) or, if unrated, determined to be of comparable quality by the Advisor. The Trust invests primarily all of the assets in a portfolio of Virginia municipal obligations, which include debt obligations issued by the commonwealth of Virginia, 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 Federal income tax and Virginia personal income tax. WHAT IS THE ADVISOR'S INVESTMENT STRATEGY? The Advisor manages the assets of the Trust in accordance with the Trust's investment objective and policies by investing primarily in municipal bonds that pay interest that is exempt from regular Federal income tax and Virginia personal income tax. The Advisor actively manages the assets in relation to market conditions and interest rate changes. Depending on yield and portfolio allocation considerations, the Advisor may choose to invest a portion of the Trust's assets in securities which pay interest that is subject to AMT. The Trust intends to invest primarily in long-term bonds and expects bonds in its portfolio to have a dollar weighted average maturity of 15 years or more, but the average maturity may be shortened or lengthened from time to time depending on market conditions. The Trust employs leverage primarily through the issuance of preferred shares. Preferred shareholders 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. The difference between the cost of the dividends paid to preferred shareholders and the interest earned on the longer-term securities will provide higher income levels for common shareholders in most interest rate environments. See "Leverage Considerations in the Trusts". 70 ADDITIONAL INFORMATION - -------------------------------------------------------------------------------- There have been no material changes in the Trusts' investment objectives or policies that have not been approved by the shareholders or to their charters or by-laws or in the principal risk factors associated with investment in the Trusts. There have been no changes in the persons who are primarily responsible for the day-to-day management of the Trusts' portfolios. Quarterly performance and other information regarding the Trusts may be found on BlackRock's website, which can be accessed at http://www.blackrock.com/funds/cefunds/index.html. This reference to BlackRock's website is intended to allow investors public access to quarterly information regarding the Trusts and does not, and is not intended, to incorporate BlackRock's website into this report. Certain of the officers of the Trusts listed on the inside back cover of this Report to Shareholders are also officers of the Advisor or Sub-Advisor. They serve in the following capacities for the Advisor or Sub-Advisor: Robert S. Kapito--Director and Vice Chairman of the Advisor and Vice Chairman of the Sub-Advisor, Kevin M. Klingert--Director anD Managing Director of the Advisor and Managing Director of the Sub-Advisor, Henry Gabbay and Anne Ackerley--Managing Directors of the Advisor and the Sub-Advisor and Richard M. Shea and James Kong--Managing Directors of the Sub-Advisor. GLOSSARY - -------------------------------------------------------------------------------- CLOSED-END FUND: Investment vehicle which initially offers a fixed number of shares and trades on a stock exchange. Each Trust invests in a portfolio of securities in accordance with its stated investment objectives and policies. DISCOUNT: When a Trust's net asset value is greater than its market price, the Trust 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. Each Trust declares and pays dividends to common shareholders on a monthly basis. DIVIDEND REINVESTMENT: Common shareholders may have all dividends and distributions of capital gains automatically reinvested into additional shares of their respective Trust. MARKET PRICE: Price per share of a security trading in the secondary market. For each Trust, this is the price at which one share of a Trust 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 a Trust, including income accrued on its investments, minus any liabilities including accrued expenses, divided by the total number of outstanding common shares. It is the underlying value of a single common share on a given day. Net asset value for each Trust is calculated weekly and published in BARRON'S on Saturday and THE WALL STREET JOURNAL on Monday. PREMIUM: When a Trust's market price is greater than its net asset value, the Trust is said to be trading at a premium. 71 BlackRock Closed-End Funds
Trustees Transfer Agent Ralph L. Schlosstein, CHAIRMAN EquiServe Trust Company, N.A. Andrew F. Brimmer 150 Royall Street Richard E. Cavanagh Canton, MA 02021 Kent Dixon (800) 699-1BFM Frank J. Fabozzi Robert S. Kapito Auction Agent(1) James Clayburn La Force, Jr. Bank of New York Walter F. Mondale 5 Penn Plaza, 13th Floor New York, NY 10001 Officers Robert S. Kapito, PRESIDENT Auction Agent(2) Kevin M. Klingert, VICE PRESIDENT Deutsche Bank Trust Company Americas Richard M. Shea, VICE PRESIDENT/TAX 4 Albany Street Henry Gabbay, TREASURER New York, NY 10006 James Kong, ASSISTANT TREASURER Anne Ackerley, SECRETARY Independent Auditors Deloitte & Touche LLP Investment Advisor 200 Berkeley Street BlackRock Advisors, Inc. Boston, MA 02116 100 Bellevue Parkway Wilmington, DE 19809 Legal Counsel (800) 227-7BFM Skadden, Arps, Slate, Meagher & Flom LLP Four Times Square Sub-Advisor New York, NY 10036 BlackRock Financial Management, Inc. 40 East 52nd Street Legal Counsel - Independent Trustees New York, NY 10022 Debevoise & Plimpton 919 Third Avenue Custodian New York, NY 10022 State Street Bank and Trust Company One Heritage Drive This report is for shareholder North Quincy, MA 02171 information. This is not a prospectus intended for use in the purchase or sale - --------- of Trust shares. Statements and other (1) For the Insured Trusts and Bond Trusts. information contained in this report are (2) For the Income II Trusts. as dated and are subject to change. BlackRock Closed-End Funds c/o BlackRock Advisors, Inc. 100 Bellevue Parkway Wilmington, DE 19809 (800) 227-7BFM
The Trusts will mail only one copy of shareholder documents, including annual and semi-annual reports and proxy statements, to shareholders with multiple accounts at the same address. This practice is commonly called "householding" and is intended to reduce expenses and eliminate duplicate mailings of shareholder documents. Mailings of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact the Trusts at (800) 227-7BFM. - -------------------------------------------------------------------------------- This report is for shareholder information. This is not a prospectus intended for use in the purchase or sale of Trust shares. Statements and other information contained in this report are as dated and are subject to change. -----END PRIVACY-ENHANCED MESSAGE-----