-----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, LQL0mWDAuylHaK+jWhDrjRvHdx2gsLfO2RWJ5g0SyGQX4ieuzO11JYJ+8KKwN8sy XXK2iqIdF3efCHmHfue9gQ== 0000900092-03-000081.txt : 20030630 0000900092-03-000081.hdr.sgml : 20030630 20030630111305 ACCESSION NUMBER: 0000900092-03-000081 CONFORMED SUBMISSION TYPE: N-CSR PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20030430 FILED AS OF DATE: 20030630 EFFECTIVENESS DATE: 20030630 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MUNIYIELD FUND INC CENTRAL INDEX KEY: 0000879361 IRS NUMBER: 223136942 STATE OF INCORPORATION: NJ FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: N-CSR SEC ACT: 1940 Act SEC FILE NUMBER: 811-06414 FILM NUMBER: 03762995 BUSINESS ADDRESS: STREET 1: 800 SCUDDERS MILL RD CITY: PLAINSBORO STATE: NJ ZIP: 08543-9011 BUSINESS PHONE: 6092822800 MAIL ADDRESS: STREET 1: PO BOX 9011 STREET 2: C/O MERRILL LYNCH ASSET MANAGEMENT CITY: PRINCETON STATE: NJ ZIP: 08543-9011 N-CSR 1 ml7017.txt MUNIYIELD UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM N-CSR CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES Investment Company Act file number 811-6435 Name of Fund: MuniYield Fund, Inc. Fund Address: P.O. Box 9011 Princeton, NJ 08543-9011 Name and address of agent for service: Terry K. Glenn, President, MuniYield Fund, Inc., 800 Scudders Mill Road, Plainsboro, NJ, 08536. Mailing address: P.O. Box 9011, Princeton, NJ, 08543-9011 Registrant's telephone number, including area code: (609) 282-2800 Date of fiscal year end: 04/30/03 Date of reporting period: 11/01/02 - 04/30/03 Item 1 - Attach shareholder report (BIULL LOGO) Merrill Lynch Investment Managers Semi-Annual Report April 30, 2003 MuniYield Fund, Inc. www.mlim.ml.com MuniYield Fund, Inc. seeks to provide shareholders with as high a level of current income exempt from Federal income taxes as is consistent with its investment policies and prudent investment management by investing primarily in a portfolio of long-term, investment-grade municipal obligations the interest on which, in the opinion of bond counsel to the issuer, is exempt from Federal income taxes. This report, including the financial information herein, is transmitted to shareholders of MuniYield Fund, Inc. for their information. It is not a prospectus. Past performance results shown in this report should not be considered a representation of future performance. The Fund has leveraged its Common Stock and intends to remain leveraged by issuing Preferred Stock to provide the Common Stock shareholders with a potentially higher rate of return. Leverage creates risks for Common Stock shareholders, including the likelihood of greater volatility of net asset value and market price of shares of the Common Stock, and the risk that fluctuations in the short-term dividend rates of the Preferred Stock may affect the yield to Common Stock shareholders. Statements and other information herein are as dated and are subject to change. MuniYield Fund, Inc. Box 9011 Princeton, NJ 08543-9011 Printed on post-consumer recycled paper MUNIYIELD FUND, INC. The Benefits And Risks of Leveraging MuniYield Fund, Inc. utilizes leveraging to seek to enhance the yield and net asset value of its Common Stock. However, these objectives cannot be achieved in all interest rate environments. To leverage, the Fund issues Preferred Stock, which pays dividends at prevailing short-term interest rates, and invests the proceeds in long-term municipal bonds. The interest earned on these investments is paid to Common Stock shareholders in the form of dividends, and the value of these portfolio holdings is reflected in the per share net asset value of the Fund's Common Stock. However, in order to benefit Common Stock shareholders, the yield curve must be positively sloped; that is, short-term interest rates must be lower than long-term interest rates. At the same time, a period of generally declining interest rates will benefit Common Stock shareholders. If either of these conditions change, then the risks of leveraging will begin to outweigh the benefits. To illustrate these concepts, assume a fund's Common Stock capitalization of $100 million and the issuance of Preferred Stock for an additional $50 million, creating a total value of $150 million available for investment in long-term municipal bonds. If prevailing short-term interest rates are approximately 3% and long-term interest rates are approximately 6%, the yield curve has a strongly positive slope. The fund pays dividends on the $50 million of Preferred Stock based on the lower short-term interest rates. At the same time, the fund's total portfolio of $150 million earns the income based on long-term interest rates. Of course, increases in short-term interest rates would reduce (and even eliminate) the dividends of the Common Stock. In this case, the dividends paid to Preferred Stock shareholders are significantly lower than the income earned on the fund's long-term investments, and therefore the Common Stock shareholders are the beneficiaries of the incremental yield. However, if short-term interest rates rise, narrowing the differential between short-term and long-term interest rates, the incremental yield pickup on the Common Stock will be reduced or eliminated completely. At the same time, the market value of the fund's Common Stock (that is, its price as listed on the New York Stock Exchange) may, as a result, decline. Furthermore, if long-term interest rates rise, the Common Stock's net asset value will reflect the full decline in the price of the portfolio's investments, since the value of the fund's Preferred Stock does not fluctuate. In addition to the decline in net asset value, the market value of the fund's Common Stock may also decline. As a part of its investment strategy, the Fund may invest in certain securities whose potential income return is inversely related to changes in a floating interest rate ("inverse floaters"). In general, income on inverse floaters will decrease when short-term interest rates increase and increase when short-term interest rates decrease. Investments in inverse floaters may be characterized as derivative securities and may subject the Fund to the risks of reduced or eliminated interest payments and losses of invested principal. In addition, inverse floaters have the effect of providing investment leverage and, as a result, the market value of such securities will generally be more volatile than that of fixed- rate, tax-exempt securities. To the extent the Fund invests in inverse floaters, the market value of the Fund's portfolio and the net asset value of the Fund's shares may also be more volatile than if the Fund did not invest in such securities. Swap Agreements The Fund may also invest in swap agreements, which are over-the- counter contracts in which one party agrees to make periodic payments based on the change in market value of a specified bond, basket of bonds, or index in return for periodic payments based on a fixed or variable interest rate or the change in market value of a different bond, basket of bonds or index. Swap agreements may be used to obtain exposure to a bond or market without owning or taking physical custody of securities. MuniYield Fund, Inc., April 30, 2003 DEAR SHAREHOLDER For the six months ended April 30, 2003, the Common Stock of MuniYield Fund, Inc. had a net annualized yield of 7.01%, based on a period-end per share net asset value of $13.46 and $.468 per share income dividends. Over the same period, the total investment return on the Fund's Common Stock was +5.08%, based on a change in per share net asset value from $13.28 to $13.46, and assuming reinvestment of $.468 per share ordinary income dividends. For the six-month period ended April 30, 2003, the Fund's Auction Market Preferred Stock had an average yield as follows: Series A, 1.09%; Series B, 1.33%; Series C, 1.08%; Series D, 1.22%; Series E, 1.07%; and Series F, 1.14%. For a description of the Fund's total investment return based on a change in the per share market value (as measured by the trading price of the Fund's shares on the New York Stock Exchange), and assuming reinvestment of dividends, please refer to the Financial Highlights section of the Financial Statements included in this report. As a closed-end fund, the Fund's shares may trade in the secondary market at a premium or discount to the Fund's net asset value. As a result, total investment returns based on changes in the Fund's market value can vary significantly from total investment return based on changes in the Fund's net asset value. The Municipal Market Environment During the six-month period ended April 30, 2003, amid considerable weekly and monthly volatility, long-term fixed income interest rates generally declined. Geopolitical tensions and volatile equity valuations continued to overshadow economic fundamentals as they have for most of the last 12 months. Reacting to the strong U.S. equity rally that began last October, fixed income bond yields remained under pressure in November 2002, as U.S. equity markets continued to strengthen. During November, the Standard & Poor's 500 (S&P 500) Index rose an additional 5.50%. Equity prices were supported by further signs of U.S. economic recovery, especially improving labor market activity. In late November, third-quarter 2002 U.S. gross domestic product growth was 4%, well above the second-quarter 2002 rate of 1.30%. Financial conditions were also strengthened by a larger-than-expected reduction in short-term interest rates by the Federal Reserve Board in early November. The Federal Funds target rate was lowered 50 basis points (0.50%) to 1.25%, its lowest level since the 1960s. This action by the Federal Reserve Board was largely viewed as being taken to bolster the sputtering U.S. economic recovery. Rebounding U.S. equity markets and the prospects for a more substantial U.S. economic recovery pushed long-term U.S. Treasury yield levels to 5.10% by late November. However, into early 2003, softer equity prices and renewed investor concerns about U.S. military action against Iraq and North Korea again pushed bond prices higher. Reacting to disappointing holiday sales and corporate managements' attempts to scale back analysts' expectation of future earnings, the S&P 500 Index declined more than 10% from December 2002 to February 2003. Fearing an eventual U.S./Iraq military confrontation in 2003, investors again sought the safety of U.S. Treasury obligations and the prices of fixed income issues rose. By the end of February 2003, U.S. Treasury bond yields had declined approximately 40 basis points to 4.67%. Bond yields continued to fall into early March. Once direct U.S. military action against Iraq began, bond yields quickly rose. Prior uncertainty surrounding the Iraqi situation was obviously removed and early U.S. military successes fostered the hope that the conflict would be quickly and positively concluded. Concurrently, the S&P 400 Index rose over 6% as investors, in part, sold fixed income issues to purchase equities in anticipation of a strong U.S. economic recovery once the Iraqi conflict was resolved. By mid-March, U.S. Treasury bond yields again rose to above 5%. However, as there was growing sentiment that hostilities may not be resolved in a matter of weeks, U.S. Treasury bond yields again declined to end the month at 4.81%. For the six months ended April 30, 2003, long-term U.S. Treasury bond yields ratcheted back to near 5% by mid-April, as U.S. equity markets continued to improve and the safe-haven premium U.S. Treasury issues had commanded prior to the beginning of the Iraqi conflict continued to be withdrawn. However, with the quick positive resolution of the Iraqi war, investors quickly resumed their focus on the fragile U.S. economic recovery. Business activity in the United States has remained sluggish, especially job creation. Investors have also been concerned that the recent SARS outbreak would have a material, negative impact on world economic conditions, especially in China and Japan. First quarter 2003 U.S. gross domestic product was released in late April initially estimating U.S. economic activity to be growing at 1.60%, well below many analysts' assessments. These factors, as well as the possibility that the Federal Reserve Board could again lower short-term interest rates to encourage more robust U.S. economic growth, pushed bond prices higher during the last two weeks of the period. By April 30, 2003, long-term U.S. Treasury bond yields had eclined to almost 4.75%. Over the past six months, long-term U.S. bond yields fell more than 20 basis points. For the six months ended April 30, 2003, long-term tax-exempt bond yields also fell modestly. Yield volatility was reduced relative to that seen in U.S. Treasury issues, as municipal bond prices were much less sensitive to worldwide geopolitical pressures on a daily and weekly basis. Tax-exempt bond yields generally followed their taxable counterparts higher, responding to a more positive U.S. fixed income environment and continued slow economic growth. After rising approximately 10 basis points in November 2002 to 5.30%, municipal bond yields generally declined through February 2003. At February 28, 2003, long-term tax-exempt revenue bond yields, as measured by the Bond Buyer Revenue Bond Index, fell to approximately 5.05%. However, similar to U.S. Treasury bond yields, once military action began in Iraq, municipal bond yields rose sharply to nearly 5.20% before declining to approximately 5.10% by the end of April. Over the past six months, long-term tax-exempt bond yields fell approximately 11 basis points, slightly less than U.S. Treasury obligations. A number of factors have combined to generate consistently strong demand for municipal bonds throughout the six-month period ended April 30, 2003. Generally weak U.S. equity markets have supported continued positive demand for tax-exempt products as investors have sought the relative security of fixed income issues. Also, with tax- exempt money market rates near 1%, the demand for longer maturity municipal issues has increased as investors have opted to buy longer maturity issues rather than remain in cash reserves. Additionally, investors received approximately $30 billion in January 2003 from bond maturities, coupon income and proceeds from early redemptions. However, these positive demand factors were not totally able to offset the increase in tax-exempt new-issue supply, preventing more significant declines in tax-exempt bond yields. This modest underperformance has served to make municipal bonds a particularly attractive purchase relative to their taxable counterparts. Throughout most of the yield curve, municipal bonds have been able to be purchased at yields near or exceeding those of comparable Treasury issues. Compared to their recent historical averages of 82% - 88% of U.S. Treasury yields, municipal bond yield ratios in their current 95% - 105% range are likely to prove attractive to long-term investors. Declining U.S. equity markets and escalating geopolitical pressures have resulted in reduced economic activity and consumer confidence. It is important to note that, despite all the recent negative factors impeding the growth of U.S. businesses, the U.S. economy still grew at an approximate 2.50% rate for all of 2002, twice that of 2001. Similar expansion is expected for early 2003. Lower oil prices, reduced geopolitical uncertainties, increased Federal spending for defense, and a likely Federal tax cut are all factors which should promote stronger economic growth later this year. However, it is questionable to expect that business and investor confidence can be so quickly restored as to trigger dramatic, explosive U.S. economic growth and engender associated, large-scale interest rate increases. The resumption of solid economic growth is likely to be a gradual process accompanied by equally graduated increases in bond yields. Moderate economic growth, especially within a context of negligible inflationary pressures, should not greatly endanger the positive fixed income environments tax-exempt products currently enjoy. Portfolio Strategy During the six-month period ended April 30, 2003, we focused on enhancing the Fund's dividend stream and reducing the Fund's asset price volatility. Reducing asset volatility involved shortening the Fund's interest rate sensitivity. This strategy worked well in January 2003 as interest rates increased from near historic lows. Since then, interest rates have decreased as a result of economic uncertainty, an unstable stock market and the unknown outcome of the Iraqi war. As interest rates have fallen further, we shifted to a more defensive position. While this strategy may have been implemented a bit early, it is our belief that interest rates do not have much further to fall. The conclusion to the Iraqi conflict is expected to lift the tremendous downward pressure being applied upon the United States economy. We believe the economy is likely to revive by year end and drive interest rates higher. During the six-month period ended April 30, 2003, the Fund's borrowing costs remained in the 1% - 1.5% range, with interest rates presently near 1%. These very attractive funding levels, in combination with the steep tax-exempt yield curve, have continued to generate significant income benefits to the Fund's Common Stock shareholder. We do not expect any material reduction in the Fund's borrowing costs in 2003 as no additional monetary easings by the Federal Reserve Board are anticipated. We expect short-term borrowing costs to remain at current attractive levels for the coming months. However, should the spread between short-term and long-term interest rates narrow, the benefits of leverage will decline and, as a result, reduce the yield on the Fund's Common Stock. (For a more complete explanation of the benefits and risks of leveraging, see page 1 of this report to shareholders.) MuniYield Fund, Inc., April 30, 2003 In Conclusion We appreciate your ongoing interest in MuniYield Fund, Inc., and we look forward to serving your investment needs in the months and years to come. Sincerely, (Terry K. Glenn) Terry K. Glenn President and Director (Kenneth A. Jacob) Kenneth A. Jacob Senior Vice President (John M. Loffredo) John M. Loffredo Senior Vice President (Roberto Roffo) Roberto Roffo Vice President and Portfolio Manager May 19, 2003 PROXY RESULTS
During the six-month period ended April 30, 2003, MuniYield Fund, Inc.'s Common Stock shareholders voted on the following proposal. The proposal was approved at a shareholders' meeting on April 28, 2003. A description of the proposal and number of shares voted are as follows: Shares Voted Shares Withheld For From Voting 1. To elect the Fund's Board of Directors: Terry K. Glenn 42,050,421 800,306 Joe Grills 42,041,798 808,929 Andre F. Perold 42,045,007 805,720 Roberta Cooper Ramo 42,045,640 805,087 Robert S. Salomon, Jr. 42,038,967 811,760 Stephen B. Swensrud 42,035,998 814,729 During the six-month period ended April 30, 2003, MuniYield Fund, Inc.'s Preferred Stock shareholders (Series A, B, C, D, E, F & G) voted on the following proposal. The proposal was approved at a shareholders' meeting on April 28, 2003. A description of the proposal and number of shares voted are as follows: Shares Voted Shares Withheld For From Voting 1. To elect the Fund's Board of Directors: Terry K. Glenn, James H. Bodurtha, Joe Grills, Herbert I. London, Andre F. Perold, Roberta Cooper Ramo, Robert S. Salomon, Jr. and Stephen B. Swensrud 11,032 10
SCHEDULE OF INVESTMENTS (in Thousands)
S&P Moody's Face STATE Ratings Ratings Amount Issue Value Alabama--0.0% A1 VMIG1++ $ 100 Columbia, Alabama, IDB, PCR, Refunding (Alabama Power Company Project), VRDN, Series E, 1.40% due 10/01/2022 (m) $ 100 Alaska--0.8% NR* Baa3 5,050 Valdez, Alaska, Marine Terminal Revenue Refunding Bonds (Amerada Hess Pipeline Corporation), 6.10% due 2/01/2024 5,075 Arizona--5.3% AAA Aaa 1,460 Arizona State Wastewater Management Authority, Wastewater Treatment Financial Assistance Revenue Bonds, Series A, 5.60% due 7/01/2006 (b)(c) 1,663 Maricopa County, Arizona, IDA, M/F Housing Revenue Refunding Bonds (CRS Pine Ridge Housing Corporation), Series A-1 (g): AAA NR* 5,000 6% due 10/20/2031 5,600 AAA NR* 5,000 6.05% due 10/20/2036 5,602 Phoenix, Arizona, IDA, Airport Facility Revenue Refunding Bonds (America West Airlines Inc. Project), AMT: NR* Caa2 8,300 6.25% due 6/01/2019 2,720 NR* Caa2 6,900 6.30% due 4/01/2023 2,261 Phoenix, Arizona, IDA, M/F Housing Revenue Bonds (Bay Club Apartments Project)(g): AAA NR* 565 5.80% due 11/20/2021 632 AAA NR* 915 5.90% due 11/20/2031 1,019 AAA NR* 1,270 5.95% due 11/20/2036 1,415 Phoenix, Arizona, IDA, M/F Housing Revenue Bonds (Summit Apartments LLC Project)(g): AAA NR* 1,610 6.25% due 7/20/2022 1,837 AAA NR* 1,425 6.45% due 7/20/2032 1,640 AAA NR* 1,305 6.55% due 7/20/2037 1,508 Pima County, Arizona, IDA, M/F Housing Revenue Bonds (Columbus Village) Series A (g): AAA NR* 990 5.90% due 10/20/2021 1,113 AAA NR* 1,725 6% due 10/20/2031 1,932 AAA NR* 2,295 6.05% due 10/20/2041 2,566
Portfolio Abbreviations To simplify the listings of MuniYield Fund, Inc.'s portfolio holdings in the Schedule of Investments, we have abbreviated the names of many of the securities according to the list at right. AMT Alternative Minimum Tax (subject to) COP Certificates of Participation DRIVERS Derivative Inverse Tax-Exempt Receipts EDA Economic Development Authority GO General Obligation Bonds HFA Housing Finance Agency IDA Industrial Development Authority IDB Industrial Development Board IDR Industrial Development Revenue Bonds M/F Multi-Family PCR Pollution Control Revenue Bonds RITR Residual Interest Trust Receipts S/F Single-Family VRDN Variable Rate Demand Notes MuniYield Fund, Inc., April 30, 2003 SCHEDULE OF INVESTMENTS (continued) (in Thousands)
S&P Moody's Face STATE Ratings Ratings Amount Issue Value California--2.6% Los Angeles County, California, Schools Regionalized Business Services, COP (County Schools Pooled Financing Program), Series B (c): AAA Aaa $ 3,000 5% due 9/01/2022 $ 3,005 AAA Aaa 4,740 5.125% due 9/01/2027 4,747 AAA Aaa 2,500 5.125% due 9/01/2031 2,503 Los Angeles County, California, Schools Regionalized Business Services, COP, Pooled Financing, Series A (c): AAA Aaa 1,430 5.90%** due 8/01/2019 651 AAA Aaa 2,510 6%** due 8/01/2029 628 AA Aa3 1,250 Sacramento County, California, Sanitation District Financing Authority, Revenue Refunding Bonds, Trust Receipts, Class R, Series A, 10.32% due 12/01/2019 (k) 1,525 BBB+ A2 2,175 Vernon, California, Electric System Revenue Bonds (Malburg Generating Station Project), 5.30% due 4/01/2026 2,178 Colorado--5.3% AA Aa2 1,005 Colorado HFA, Revenue Refunding Bonds (S/F Program), AMT, Series D-2, 6.90% due 4/01/2029 1,046 Colorado Health Facilities Authority, Health Facilities Revenue Bonds (National Benevolent Association): NR* Baa3 1,000 Series A, 6.375% due 9/01/2029 864 NR* Baa3 1,200 Series C, 7% due 3/01/2019 1,195 NR* Baa3 750 Series C, 7% due 3/01/2024 728 NR* Baa3 1,125 Series C, 7.125% due 3/01/2030 1,096 AAA NR* 8,000 Denver, Colorado, City and County Airport Revenue Bonds, AMT, Series D, 7.75% due 11/15/2013 (c) 10,096 NR* Baa2 5,500 Denver, Colorado, Urban Renewal Authority, Tax Increment Revenue Bonds (Pavilions), AMT, 7.75% due 9/01/2016 5,957 Elk Valley, Colorado, Public Improvement Revenue Bonds (Public Improvement Fee), Series A: NR* NR* 1,735 7.10% due 9/01/2014 1,773 NR* NR* 5,065 7.35% due 9/01/2031 5,174 BB+ Ba1 3,500 Northwest Parkway, Colorado, Public Highway Authority Revenue Bonds, First Tier, Sub-Series D, 7.125% due 6/15/2041 3,660 Connecticut-- NR* NR* 650 Connecticut State Development Authority, IDR (AFCO Cargo BDL-LLC 2.7% Project), AMT, 7.35% due 4/01/2010 654 AAA Aaa 9,675 Connecticut State, HFA, Revenue Refunding Bonds (Housing Mortgage Finance Program), Series F, Sub-Series F-1, 6% due 5/15/2017 10,293 AAA Aaa 4,355 Connecticut State Special Tax Obligation Revenue Bonds, Transportation Infrastructure, Series A, 6% due 12/01/2009 (b)(h) 5,226 Florida--5.1% NR* NR* 1,760 Bonnet Creek Resort, Florida, Community Development District, Special Assessment Revenue Bonds, 7.50% due 5/01/2034 1,810 AAA Aaa 2,755 Broward County, Florida, Airport System Revenue Bonds, AMT, Series J-1, 5.75% due 10/01/2018 (c) 3,037 Hillsborough County, Florida, IDA, Exempt Facilities Revenue Bonds (National Gypsum), AMT: NR* NR* 11,500 Series A, 7.125% due 4/01/2030 11,567 NR* NR* 5,000 Series B, 7.125% due 4/01/2030 5,029 AAA Aaa 8,700 Pinellas County, Florida, Housing Authority, Housing Revenue Bonds (Affordable Housing Program), 4.60% due 12/01/2010 (i) 9,461 Georgia--3.1% AAA Aaa 12,140 Atlanta, Georgia, Airport Revenue Refunding Bonds, Series A, 5.875% due 1/01/2016 (h) 13,915 NR* NR* 4,600 Atlanta, Georgia, Tax Allocation Revenue Bonds (Atlantic Station Project), 7.90% due 12/01/2024 4,771 Idaho--1.9% AA NR* 1,400 Idaho Housing Agency, S/F Mortgage Revenue Refunding Bonds, AMT, Senior-Series C-2, 7.15% due 7/01/2023 1,412 BB+ Ba3 12,125 Power County, Idaho, Industrial Development Corporation, Solid Waste Disposal Revenue Bonds (FMC Corporation Project), AMT, 6.45% due 8/01/2032 10,164 Illinois--6.4% NR* B2 835 Beardstown, Illinois, IDR (Jefferson Smurfit Corp. Project), 8% due 10/01/2016 858 NR* Aaa 780 Chicago, Illinois, S/F Mortgage Revenue Bonds, AMT, Series B, 7.625% due 9/01/2027 (f)(g)(l) 813 AAA Aaa 3,285 Illinois Development Finance Authority Revenue Bonds (Presbyterian Home Lake Project), Series B, 6.30% due 9/01/2022 (i) 3,733 NR* NR* 2,750 Illinois Development Finance Authority, PCR, Refunding (Illinois Power Company Project), Series A, 7.375% due 7/01/2006 (b) 3,247 NR* NR* 2,500 Illinois Educational Facilities Authority, Revenue Refunding Bonds (Chicago Osteopathic Health System), 7.25% due 11/15/2019 (b) 2,567 NR* Ba3 1,250 Illinois Health Facilities Authority Revenue Bonds (Holy Cross Hospital Project), 6.70% due 3/01/2014 876 Illinois Health Facilities Authority, Revenue Refunding Bonds, VRDN (m): A1 VMIG1++ 5,700 (Resurrection Health Care), Series A, 1.35% due 5/15/2029 (i) 5,700 A1 VMIG1++ 5,310 (University of Chicago Hospitals), 1.35% due 8/01/2026 (e) 5,310 AAA Aaa 4,000 Metropolitan Pier and Exposition Authority, Illinois, Dedicated State Tax Revenue Bonds (McCormick Place Expansion), Series A, 5.50% due 6/15/2023 (e) 4,367 AAA Aaa 8,000 Metropolitan Pier and Exposition Authority, Illinois, Hospitality Facilities Revenue Bonds (McCormick Place Convention Center), 7% due 7/01/2026 (a) 10,718 Kansas--0.2% BB+ NR* 1,250 Lenexa, Kansas, Health Care Facility Revenue Bonds (Lakeview Village Inc.), Series C, 6.875% due 5/15/2032 1,271 Kentucky--0.7% BBB Baa2 4,000 Perry County, Kentucky, Solid Waste Disposal Revenue Bonds (TJ International Project), AMT, 7% due 6/01/2024 4,151 Louisiana--3.9% BB- NR* 24,000 Port New Orleans, Louisiana, IDR, Refunding (Continental Grain Company Project), 6.50% due 1/01/2017 23,423 Maryland--1.4% NR* NR* 3,000 Maryland State Energy Financing Administration, Limited Obligation Revenue Bonds (Cogeneration--AES Warrior Run), AMT, 7.40% due 9/01/2019 3,065 A Baa1 5,000 Maryland State Health and Higher Educational Facilities Authority, Revenue Refunding Bonds (University of Maryland Medical System), 6% due 7/01/2032 5,349 Michigan--0.1% NR* VMIG1++ 400 Michigan State Strategic Fund, PCR, Refunding (Consumers Power Project), VRDN, 1.35% due 4/15/2018 (c)(m) 400 Minnesota--0.6% Eden Prairie, Minnesota, M/F Housing Revenue Bonds (Rolling Hills Project), Series A (g): NR* A1 420 6% due 8/20/2021 470 NR* A1 2,000 6.20% due 2/20/2043 2,237
MuniYield Fund, Inc., April 30, 2003 SCHEDULE OF INVESTMENTS (continued) (in Thousands)
S&P Moody's Face STATE Ratings Ratings Amount Issue Value Minnesota NR* Aa2 $ 995 Minneapolis, Minnesota, M/F Housing Revenue Bonds (Gaar Scott (concluded) Loft Project), AMT, 5.95% due 5/01/2030 $ 1,068 Missouri--0.9% Fenton, Missouri, Tax Increment Revenue Refunding and Improvement Bonds (Gravois Bluffs): NR* NR* 1,055 6.75% due 10/01/2015 1,092 NR* NR* 2,800 7% due 10/01/2021 2,958 AAA NR* 1,380 Missouri State Housing Development Commission, S/F Mortgage Revenue Bonds, Homeownership, AMT, Series B, 7.55% due 9/01/2027 (f)(g) 1,424 New Jersey-- NR* NR* 3,000 New Jersey EDA, First Mortgage Revenue Bonds (The Presbyterian 13.5% Home), Series A, 6.375% due 11/01/2031 3,018 NR* NR* 3,300 New Jersey EDA, Retirement Community Revenue Bonds (Cedar Crest Village Inc. Facility), Series A, 7.25% due 11/15/2031 3,300 New Jersey EDA, Special Facility Revenue Bonds (Continental Airlines Inc. Project), AMT: B Caa2 3,905 6.25% due 9/15/2019 2,814 B Caa2 8,595 6.25% due 9/15/2029 6,023 BB+ NR* 4,180 New Jersey Health Care Facilities Financing Authority Revenue Bonds (Pascack Valley Hospital Association), 6.625% due 7/01/2036 4,131 A- A2 9,640 New Jersey State Transit Corporation, COP (Federal Transit Administration Grants), Series B, 5.75% due 9/15/2014 10,859 AAA NR* 4,360 Port Authority of New York and New Jersey Revenue Refunding Bonds, DRIVERS, AMT, Series 177, 10.34% due 10/15/2032 (e)(k) 5,549 AAA NR* 20,575 Port Authority of New York and New Jersey, Special Obligation Revenue Bonds, DRIVERS, AMT, Series 192, 9.85% due 12/01/2025 (e)(k) 24,194 A- A3 9,500 Tobacco Settlement Financing Corporation of New Jersey Revenue Bonds, 6.75% due 6/01/2039 8,404 A- A3 15,500 Tobacco Settlement Financing Corporation, New Jersey, Asset Backed Revenue Refunding Bonds, 6% due 6/01/2037 12,651 New York--27.0% AAA Aaa 1,865 Dutchess County, New York, Resource Recovery Agency Revenue Bonds (Solid Waste System), Series A, 5.25% due 1/01/2011 (e) 2,107 AAA Aaa 5,595 Metropolitan Transportation Authority, New York, Commuter Facilities Revenue Bonds, RITR, Series 9, 6.10% due 7/01/2006 (b)(h)(k) 7,346 A A2 10,000 Metropolitan Transportation Authority, New York, Revenue Refunding Bonds, Series A, 5.75% due 11/15/2032 10,905 BBB+ A3 10,000 New York City, New York, City IDA, Special Facilities Revenue Bonds (Terminal One Group Association Project), AMT, 6.125% due 1/01/2024 10,218 New York City, New York, City Municipal Water Finance Authority, Water and Sewer System Revenue Bonds (k): AAA NR* 5,000 DRIVERS, Series 198, 9.90% due 6/15/2026 (e) 6,076 NR* Aaa 3,000 RITR, Series 11, 9.92% due 6/15/2026 (i) 3,767 AA Aa2 24,000 New York City, New York, City Municipal Water Finance Authority, Water and Sewer System Revenue Refunding Bonds, 5.50% due 6/15/2033 25,955 A A2 17,615 New York City, New York, Fiscal Year 2003, GO, Series I, 5.375% due 3/01/2027 18,205 New York City, New York, GO, Refunding, Series G: AAA Aaa 1,825 5.50% due 8/01/2012 (o) 2,069 AAA Aaa 2,090 5.75% due 2/01/2014 (e) 2,301 AAA Aaa 2,000 5.75% due 2/01/2014 (h) 2,202 AAA Aaa 10,000 New York City, New York, GO, Refunding, Trust Receipts, Series R, 11.078% due 5/15/2014 (h)(k) 13,738 AA- A3 6,100 New York State Dormitory Authority Revenue Refunding Bonds, Series B, 5.25% due 11/15/2023 6,758 AA- NR* 6,795 New York State Dormitory Authority, Hospital Revenue Refunding Bonds (North General Hospital), 5.75% due 2/15/2015 7,703 AAA Aaa 7,500 New York State Dormitory Authority, State University Educational Facilities Revenue Refunding Bonds, Series 1989, 6% due 5/15/2015 (e) 8,789 New York State Thruway Authority, Second General Highway and Bridge Trust Fund Revenue Bonds, Series A (e): AAA Aaa 1,000 5.25% due 4/01/2022 1,073 AAA Aaa 3,100 5.25% due 4/01/2023 3,310 AA A1 10,000 New York State Urban Development Corporation, Personal Income Tax Revenue Bonds (State Facilities), Series A, 5.50% due 3/15/2032 10,709 NR* NR* 2,500 Suffolk County, New York, IDA, IDR, Refunding (Nissequogue Cogeneration Partners Facility), AMT, 5.50% due 1/01/2023 2,293 A+ A1 10,000 Triborough Bridge and Tunnel Authority, New York, Subordinate Revenue Bonds, 5.25% due 11/15/2030 10,461 Westchester County, New York, IDA, Continuing Care Retirement Mortgage Revenue Bonds (Kendal on Hudson Project), Series A: NR* NR* 3,450 6.375% due 1/01/2024 3,394 NR* NR* 2,395 6.50% due 1/01/2034 2,359 North Carolina-- BBB Baa3 4,750 North Carolina Eastern Municipal Power Agency, Power System 2.7% Revenue Bonds, Series D, 6.75% due 1/01/2026 5,166 AA Aa2 950 North Carolina HFA, Home Ownership Revenue Bonds, AMT, Series 8-A, 6.20% due 7/01/2016 1,010 AA Aa2 1,495 North Carolina HFA, S/F Revenue Bonds, Series II, 6.20% due 3/01/2016 (d) 1,591 NR* NR* 1,000 North Carolina Medical Care Commission, Health Care Facilities, First Mortgage Revenue Bonds (Arbor Acres Community Project), 6.375% due 3/01/2032 1,014 North Carolina Municipal Power Agency Number 1, Catawba Electric Revenue Bonds, Series A (e): AAA Aaa 4,500 5.25% due 1/01/2019 4,868 AAA Aaa 2,250 5.25% due 1/01/2020 2,416 Ohio--2.0% AA+ Aa2 3,000 Cincinnati, Ohio, Water System Revenue Bonds, 5% due 12/01/2023 3,105 Cuyahoga County, Ohio, Mortgage Revenue Bonds (West Tech Apartments Project), AMT (g): NR* Aaa 1,410 5.75% due 9/20/2020 1,499 NR* Aaa 2,250 5.85% due 9/20/2030 2,382 NR* NR* 2,175 Lucas County, Ohio, Health Care Facility Revenue Refunding and Improvement Bonds (Sunset Retirement Communities), Series A, 6.625% due 8/15/2030 2,297
MuniYield Fund, Inc., April 30, 2003 SCHEDULE OF INVESTMENTS (continued) (in Thousands)
S&P Moody's Face STATE Ratings Ratings Amount Issue Value Ohio NR* Aaa $ 1,120 Mad River, Ohio, Local School District, GO, Refunding (concluded) (Classroom Facilities), 5.75% due 12/01/2019 (h) $ 1,278 NR* Aaa 1,000 Montgomery County, Ohio, Water System Revenue Refunding Bonds (Greater Moraine Beaver), 5.375% due 11/15/2015 (c) 1,125 Oklahoma--2.0% Holdenville, Oklahoma, Industrial Authority, Correctional Facility Revenue Bonds (b)(j): AAA NR* 1,650 6.60% due 7/01/2006 1,930 AAA NR* 3,250 6.70% due 7/01/2006 3,811 A1+ VMIG1++ 6,090 Oklahoma State Industries Authority, Revenue Refunding Bonds (Integris Baptist), VRDN, Series B, 1.35% due 8/15/2029 (e)(m) 6,090 Oregon--3.0% Oregon State Department of Administrative Services, COP, Series A (b)(c): AAA Aaa 4,405 6% due 5/01/2010 5,251 AAA Aaa 3,500 6% due 5/01/2010 4,172 AA Aa3 6,245 Oregon State, GO, Refunding (Veterans Welfare), Series 80A, 5.70% due 10/01/2032 6,562 NR* NR* 1,830 Portland, Oregon, Housing Authority, Housing Revenue Bonds (Pine Square and University Place), Series A, 5.875% due 1/01/2022 1,827 Pennsylvania-- BBB+ Baa1 1,500 Lebanon County, Pennsylvania, Health Facilities Authority, 14.4% Hospital Revenue Bonds (Good Samaritan Hospital Project), 6% due 11/15/2035 1,524 AAA Aaa 5,000 Lehigh County, Pennsylvania, IDA, PCR, Refunding (Pennsylvania Power and Light Company Project), Series B, 6.40% due 9/01/2029 (e) 5,409 AAA Aaa 9,675 Pennsylvania Convention Center Revenue Refunding Bonds, Series A, 6.70% due 9/01/2014 (e) 10,526 Pennsylvania Economic Development Financing Authority, Exempt Facilities Revenue Bonds (National Gypsum Company), AMT: NR* NR* 16,350 Series A, 6.25% due 11/01/2027 14,861 NR* NR* 8,800 Series B, 6.125% due 11/01/2027 7,871 AA+ Aa2 1,590 Pennsylvania HFA, S/F Mortgage Refunding Bonds, AMT, Series 42, 6.85% due 4/01/2025 1,649 AAA Aaa 16,270 Pennsylvania State Higher Educational Facilities Authority, Health Services Revenue Refunding Bonds (Allegheny Delaware Valley Obligation), Series C, 5.875% due 11/15/2016 (e) 18,388 NR* NR* 1,265 Philadelphia, Pennsylvania, Authority for IDR, Commercial Development, AMT, 7.75% due 12/01/2017 1,296 Philadelphia, Pennsylvania, Authority for IDR, Refunding, Commercial Development: NR* NR* 3,650 (Days Inn), Series B, 6.50% due 10/01/2027 3,622 NR* NR* 4,000 (Doubletree), Series A, 6.50% due 10/01/2027 3,937 AAA Aaa 10,965 Philadelphia, Pennsylvania, School District, GO, Series A, 5.50% due 2/01/2031 (i) 11,758 A- NR* 5,000 Sayre, Pennsylvania, Health Care Facilities Authority Revenue Bonds (Guthrie Health Issue), Series B, 1%/7.125% due 12/01/2031 (p) 5,332 Rhode Island-- Woonsocket, Rhode Island, GO (h): 0.5% NR* Aaa 1,225 6% due 10/01/2017 1,438 NR* Aaa 1,195 6% due 10/01/2018 1,399 South Dakota-- BBB+ Baa2 900 South Dakota State Health and Educational Facilities Authority, 0.2% Revenue Refunding Bonds (Prairie Lakes), 7.25% due 4/01/2022 927 Tennessee--2.6% NR* NR* 4,610 Hardeman County, Tennessee, Correctional Facilities Corporation Revenue Bonds, 7.75% due 8/01/2017 4,645 BB+ Ba1 10,850 McMinn County, Tennessee, IDB, Solid Waste Revenue Bonds (Recycling Facility--Calhoun Newsprint), AMT, 7.40% due 12/01/2022 10,721 Texas--18.6% Austin, Texas, Convention Center Revenue Bonds (Convention Enterprises Inc.), First Tier, Series A: BBB- Baa3 5,000 6.70% due 1/01/2028 5,202 BBB- Baa3 5,000 6.70% due 1/01/2032 5,183 Bexar County, Texas, Housing Finance Corporation, M/F Housing Revenue Bonds (Water at Northern Hills Apartments), Series A (e): NR* Aaa 1,300 5.80% due 8/01/2021 1,417 NR* Aaa 2,460 6% due 8/01/2031 2,687 NR* Aaa 1,000 6.05% due 8/01/2036 1,093 BBB Baa2 6,850 Brazos River Authority, Texas, PCR, Refunding (Utilities Electric Company), AMT, Series B, 5.05% due 6/01/2030 6,835 BBB- Ba1 3,700 Brazos River Authority, Texas, Revenue Refunding Bonds (Reliant Energy Inc. Project), Series B, 7.75% due 12/01/2018 3,856 Dallas-Fort Worth, Texas, International Airport Facility, Improvement Corporation, Revenue Refunding Bonds (American Airlines), AMT: CC Caa2 2,500 Series A, 5.95% due 5/01/2029 1,625 CC Caa2 14,000 Series B, 6.05% due 5/01/2029 5,276 Gregg County, Texas, Health Facilities Development Corporation, Hospital Revenue Bonds (Good Shepherd Medical Center Project): AA NR* 3,000 6.875% due 10/01/2020 3,560 AA NR* 2,000 6.375% due 10/01/2025 2,257 AA- Aa3 5,000 Guadalupe-Blanco River A1uthority, Texas, Sewage and Solid Waste Disposal Facility Revenue Bonds (E.I. du Pont de Nemours and Company Project), AMT, 6.40% due 4/01/2026 5,338 NR* Ba3 3,900 Gulf Coast, Texas, IDA, Solid Waste Disposal Revenue Bonds (Citgo Petroleum Corporation Project), AMT, 7.50% due 5/01/2025 3,834 B Caa2 2,000 Houston, Texas, Airport System, Special Facilities Revenue Bonds (Continental Airlines), AMT, Series E, 6.75% due 7/01/2029 1,181 NR* Baa3 1,600 Houston, Texas, Industrial Development Corporation Revenue Bonds (Air Cargo), AMT, 6.375% due 1/01/2023 1,577 Lower Colorado River Authority, Texas, PCR (Samsung Austin Semiconductor), AMT: A- A3 6,200 6.375% due 4/01/2027 6,469 A- A3 4,000 6.95% due 4/01/2030 4,356 BBB- Ba1 7,030 Matagorda County, Texas, Navigation District Number 1, Revenue Refunding Bonds (Reliant Energy Inc.), Series C, 8% due 5/01/2029 7,309 BBB Baa2 10,280 Sabine River Authority, Texas, PCR, Refunding (TXU Electric Company Project), Series C, 4% due 5/01/2028 10,283 San Antonio, Texas, Water Revenue Refunding Bonds: AA- Aa3 1,000 5.875% due 5/15/2016 1,155 AA- Aa3 1,000 5.875% due 5/15/2017 1,152 AAA Aaa 6,500 Texas State Turnpike Authority, Central Texas Turnpike System Revenue Bonds, First Tier, Series A, 5.50% due 8/15/2039 (c) 6,930
MuniYield Fund, Inc., April 30, 2003 SCHEDULE OF INVESTMENTS (concluded) (in Thousands)
S&P Moody's Face STATE Ratings Ratings Amount Issue Value Texas Texas State, Water Financial Assisstance, GO, AMT, Series A: (concluded) AA Aa1 $ 4,090 5.375% due 8/01/2033 $ 4,215 AA Aa1 10,560 5.125% due 8/01/2042 10,628 AAA Aaa 7,020 Tyler, Texas, Waterworks and Sewer Revenue Bonds, 5.70% due 9/01/2030 (h) 7,759 Utah--0.3% NR* NR* 1,000 Tooele County, Utah, PCR, Refunding (Laidlaw Environmental), AMT, Series A, 7.55% due 7/01/2027 (n) 0 AAA Aaa 1,545 Utah State Board of Regents Revenue Refunding Bonds (University of Utah Research Facilities), Series A, 5.50% due 4/01/2018 (e) 1,719 Virginia--2.5% BBB NR* 5,000 Amelia County, Virginia, IDA, Solid Waste Disposal Revenue Refunding Bonds (Waste Management Project), VRDN, AMT, 4.90% due 4/01/2027 (m) 5,162 AAA Aaa 5,000 Fairfax County, Virginia, EDA, Resource Recovery Revenue Refunding Bonds, AMT, Series A, 6.10% due 2/01/2011 (c) 5,791 NR* NR* 1,000 Pittsylvania County, Virginia, IDA, Revenue Refunding Bonds, Exempt Facility, AMT, Series A, 7.55% due 1/01/2019 999 Pocahontas Parkway Association, Virginia, Toll Road Revenue Bonds: NR* Ba1 6,200 First Tier, Sub-Series C, 6.25%** due 8/15/2031 194 BB NR* 24,800 Senior-Series B, 6.67%** due 8/15/2029 2,481 Washington--0.4% Vancouver, Washington, Housing Authority, Housing Revenue Bonds (Teal Pointe Apartments Project), AMT: NR* NR* 945 6% due 9/01/2022 932 NR* NR* 1,250 6.20% due 9/01/2032 1,230 West Virginia-- B+ Ba3 1,000 Princeton, West Virginia, Hospital Revenue Refunding Bonds 0.6% (Community Hospital Association Inc. Project), 6% due 5/01/2019 807 BBB Baa2 3,000 Upshur County, West Virginia, Solid Waste Disposal Revenue Bonds (TJ International Project), AMT, 7% due 7/15/2025 3,149 Wisconsin--0.6% NR* Baa3 700 Milwaukee, Wisconsin, Revenue Bonds (Air Cargo), AMT, 6.50% due 1/01/2025 672 AAA Aaa 2,600 Wisconsin State, GO, AMT, Series B, 6.20% due 11/01/2026 (e) 2,913 Wyoming--0.8% BB+ Ba3 2,550 Sweetwater County, Wyoming, Solid Waste Disposal Revenue Bonds (FMC Corporation Project), AMT, Series A, 7% due 6/01/2024 2,353 AA NR* 2,500 Wyoming Student Loan Corporation, Student Loan Revenue Refunding Bonds, Series A, 6.20% due 6/01/2024 2,679 Puerto Rico-- Puerto Rico Commonwealth Highway and Transportation Authority, 10.9% Transportation Revenue Bonds: AAA Aaa 15,000 Trust Receipts, Class R, Series B, 10.079% due 7/01/2035 (e)(k) 20,311 A Baa1 18,000 Series D, 5.75% due 7/01/2041 19,924 AAA Aaa 2,500 Puerto Rico Electric Power Authority, Power Revenue Bonds, Trust Receipts, Class R, Series 16 HH, 9.81% due 7/01/2013 (i)(k) 3,421 Puerto Rico Public Buildings Authority, Government Facilities Revenue Refunding Bonds: A- Baa1 5,425 Series F, 5.25% due 7/01/2023 5,752 A- Baa1 6,535 Series F, 5.25% due 7/01/2025 6,924 A- Baa1 3,000 Series G, 5% due 7/01/2026 3,017 NR* Aa2 4,350 Puerto Rico Public Finance Corporation Revenue Bonds, DRIVERS, Series 272, 9.13% due 8/01/2030 (k) 5,191 Total Municipal Bonds (Cost--$827,056)--143.6% 858,121 Shares Held Short-Term Securities 6,913 Merrill Lynch Institutional Tax-Exempt Fund++++ 6,913 Total Short-Term Securities (Cost--$6,913)--1.1% 6,913 Total Investments (Cost--$833,969)--144.7% 865,034 Unrealized Depreciation on Forward Interest Rate Swaps++++++--(0.2%) (1,093) Other Assets Less Liabilities--4.5% 27,086 Preferred Stock, at Redemption Value--(49.0%) (293,009) --------- Net Assets Applicable to Common Stock--100.0% $ 598,018 ========= (a)Escrowed to maturity. (b)Prerefunded. (c)AMBAC Insured. (d)FHA Insured. (e)MBIA Insured. (f)FNMA Collateralized. (g)GNMA Collateralized. (h)FGIC Insured. (i)FSA Insured. (j)Connie Lee Insured. (k)The interest rate is subject to change periodically and inversely based upon prevailing market rates. The interest rate shown is the rate in effect at April 30, 2003. (l)FHLMC Collateralized. (m)The interest rate is subject to change periodically based upon prevailing market rates. The interest rate shown is the rate in effect at April 30, 2003. (n)Non-income producing security. (o)XL Capital Insured. (p)Represents a step bond. The first interest rate is in effect until a predetermined date and the second interest rate is effective thereafter until maturity. *Not Rated. **Represents a zero coupon bond; the interest rate shown reflects the effective yield at the time of purchase by the Fund. ++Highest short-term rating by Moody's Investors Service, Inc. ++++Investments in companies considered to be an affiliate of the Fund (such companies are defined as "Affiliated Companies" in Section 2(a)(3) of the Investment Company Act of 1940) are as follows: (in Thousands) Net Dividend Affiliate Activity Income Merrill Lynch Institutional Tax-Exempt Fund 6,901 $3 ++++++Forward interest rate swaps entered into as of April 30, 2003 were as follows: (in Thousands) Unrealized Notional Appreciation Amount (Depreciation) Receive a variable rate equal to 7-Day Bond Market Association rate at quarterly reset date and pay a fixed rate equal to 4.064%. Broker, Morgan Stanley Capital Services Inc. Expires, July 30, 2023 67,000 $ (390) Receive a variable rate equal to 7-Day Bond Market Association rate at quarterly reset date and pay a fixed rate equal to 4.265%. Broker, JP Morgan Chase Expires, July 9, 2023 22,000 (703) --------- $ (1,093) ========= See Notes to Financial Statements.
MuniYield Fund, Inc., April 30, 2003 STATEMENT OF NET ASSETS
As of April 30, 2003 Assets: Investments, at value (identified cost--$833,968,668) $865,034,207 Cash 66,589 Receivables: Securities sold $ 18,943,977 Interest 14,760,674 Dividends 222 33,704,873 ------------ Prepaid expenses and other assets 68,383 ------------ Total assets 898,874,052 ------------ Liabilities: Unrealized depreciation on forward interest rate swaps 1,092,731 Payables: Securities purchased 5,760,999 Dividends to Common Stock shareholders 536,520 Investment adviser 374,354 Other affiliates 6,836 6,678,709 ------------ Accrued expenses 75,384 ------------ Total liabilities 7,846,824 ------------ Preferred Stock: Preferred Stock, par value $.05 per share (1,800 Series A shares, 1,800 Series B shares, 1,800 Series C shares, 1,800 Series D shares, 2,800 Series E shares and 1,720 Series F shares of AMPS* issued and outstanding at $25,000 per share liquidation preference) 293,009,477 ------------ Net Assets Net assets applicable to Common Stock $598,017,751 Applicable To ============ Common Stock: Analysis of Common Stock, par value $.10 per share (44,430,631 shares issued and Net Assets outstanding) $ 4,443,063 Applicable to Paid-in capital in excess of par 632,817,001 Common Stock: Undistributed investment income--net $ 9,881,328 Accumulated realized capital losses on investments--net (79,096,449) Unrealized appreciation on investments--net 29,972,808 ------------ Total accumulated losses--net (39,242,313) ------------ Total--Equivalent to $13.46 net asset value per share of Common Stock (market price--$13.04) $598,017,751 ============ *Auction Market Preferred Stock. See Notes to Financial Statements.
STATEMENT OF OPERATIONS
For the Six Months Ended April 30, 2003 Investment Interest $ 26,297,509 Income: Dividends 3,083 ------------ Total income 26,300,592 ------------ Expenses: Investment advisory fees $ 2,189,339 Commission fees 374,026 Accounting services 127,297 Transfer agent fees 58,032 Professional fees 34,150 Custodian fees 23,998 Printing and shareholder reports 21,044 Directors' fees and expenses 19,330 Listing fees 15,547 Pricing fees 15,064 Other 24,403 ------------ Total expenses before reimbursement 2,902,230 Reimbursement of expenses (559) ------------ Total expenses after reimbursement 2,901,671 ------------ Investment income--net 23,398,921 ------------ Realized & Realized loss on investments--net (7,994,581) Unrealized Change in unrealized appreciation on investments--net 14,974,926 Gain (Loss) on ------------ Investments--Net: Total realized and unrealized gain on investments--net 6,980,345 ------------ Dividends to Investment income--net (1,669,106) Preferred Stock ------------ Shareholders: Net Increase in Net Assets Resulting from Operations $ 28,710,160 ============ See Notes to Financial Statements.
MuniYield Fund, Inc., April 30, 2003 STATEMENTS OF CHANGES IN NET ASSETS
For the Six For the Months Ended Year Ended April 30, October 31, Increase (Decrease) in Net Assets: 2003 2002 Operations: Investment income--net $ 23,398,921 $ 46,897,259 Realized loss on investments--net (7,994,581) (3,498,012) Change in unrealized appreciation/depreciation on investments--net 14,974,926 (9,783,800) Dividends to Preferred Stock shareholders (1,669,106) (4,354,062) ------------ ------------ Net increase in net assets resulting from operations 28,710,160 29,261,385 ------------ ------------ Dividends to Investment income--net (20,793,535) (40,283,240) Common Stock ------------ ------------ Shareholders: Net decrease in net assets resulting from dividends to Common Stock shareholders (20,793,535) (40,283,240) ------------ ------------ Common Stock Proceeds from issuance of Common Stock resulting from reorganization -- 73,630,647 Transactions: Value of shares issued to Common Stock shareholders in reinvestment of dividends -- 2,755,535 ------------ ------------ Net increase in net assets derived from Common Stock transactions -- 76,386,182 ------------ ------------ Net Assets Total increase in net assets applicable to Common Stock 7,916,625 65,364,327 Applicable To Beginning of period 590,101,126 524,736,799 Common Stock: ------------ ------------ End of period* $598,017,751 $590,101,126 ============ ============ *Undistributed investment income--net $ 9,881,328 $ 8,945,048 ============ ============ See Notes to Financial Statements.
FINANCIAL HIGHLIGHTS
The following per share data and ratios For the have been derived from information Six Months provided in the financial statements. Ended April 30, For the Year Ended October 31, Increase (Decrease) in Net Asset Value: 2003 2002 2001 2000 1999 Per Share Net asset value, beginning of period $ 13.28 $ 13.55 $ 13.08 $ 13.21 $ 16.27 Operating --------- --------- --------- --------- --------- Performance:++++ Investment income--net .53+++++ 1.04 1.03 1.09 1.12 Realized and unrealized gain (loss) on investments--net .16 (.31) .52 (.08) (2.34) Dividends and distributions to Preferred Stock shareholders: Investment income--net (.04) (.08) (.22) (.27) (.17) Realized gain on investments--net -- -- -- -- (.04) In excess of realized gain on investments--net -- -- -- -- (.03) --------- --------- --------- --------- --------- Total from investment operations .65 .65 1.33 .74 (1.46) --------- --------- --------- --------- --------- Less dividends and distributions to Common Stock shareholders: Investment income--net (.47) (.92) (.86) (.87) (.95) Realized gain on investments--net -- -- -- -- (.38) In excess of realized gain on investments--net -- -- -- -- (.27) --------- --------- --------- --------- --------- Total dividends and distributions to Common Stock shareholders (.47) (.92) (.86) (.87) (1.60) --------- --------- --------- --------- --------- Net asset value, end of period $ 13.46 $ 13.28 $ 13.55 $ 13.08 $ 13.21 ========= ========= ========= ========= ========= Market price per share, end of period $ 13.04 $ 12.88 $ 13.94 $ 12.625 $ 12.875 ========= ========= ========= ========= ========= Total Investment Based on market price per share 4.96%+++ (.94%) 17.79% 5.26% (15.35%) Return:*** ========= ========= ========= ========= ========= Based on net asset value per share 5.08%+++ 5.07% 10.51% 6.28% (9.92%) ========= ========= ========= ========= ========= Ratios Based on Total expenses, net of reimbursement** .99%* 1.01% 1.01% .99% .93% Average Net ========= ========= ========= ========= ========= Assets of Total expenses** .99%* 1.01% 1.01% .99% .93% Common Stock: ========= ========= ========= ========= ========= Total investment income--net** 8.00%* 7.97% 7.74% 8.35% 7.42% ========= ========= ========= ========= ========= Amount of dividends to Preferred Stock shareholders .57%* .74% 1.63% 2.07% 1.11% ========= ========= ========= ========= ========= Investment income--net, to Common Stock shareholders 7.43%* 7.23% 6.11% 6.28% 6.31% ========= ========= ========= ========= ========= Ratios Based on Total expenses, net of reimbursement .66%* .67% .68% .66% .65% Average Net ========= ========= ========= ========= ========= Assets of Total expenses .66%* .67% .68% .66% .65% Common & Preferred ========= ========= ========= ========= ========= Stock:** Total investment income--net 5.35%* 5.33% 5.20% 5.56% 5.17% ========= ========= ========= ========= ========= Ratios Based on Dividends to Preferred Stock shareholders 1.15%* 1.50% 3.33% 4.12% 2.55% Average Net ========= ========= ========= ========= ========= Assets Of Preferred Stock: Supplemental Net assets applicable to Common Stock, Data: end of period (in thousands) $ 598,018 $ 590,101 $ 524,737 $ 501,361 $ 506,030 ========= ========= ========= ========= ========= Preferred Stock outstanding, end of period (in thousands) $ 293,000 $ 293,000 $ 250,000 $ 250,000 $ 250,000 ========= ========= ========= ========= ========= Portfolio turnover 23.17% 104.63% 83.26% 103.44% 78.42% ========= ========= ========= ========= ========= Leverage: Asset coverage per $1,000 $ 3,041 $ 3,014 $ 3,099 $ 3,005 $ 3,024 ========= ========= ========= ========= ========= Dividends Series A--Investment income--net $ 136 $ 346 $ 816 $ 1,052 $ 588 Per Share on ========= ========= ========= ========= ========= Preferred Stock Series B--Investment income--net $ 164 $ 369 $ 864 $ 1,009 $ 595 Outstanding: ========= ========= ========= ========= ========= Series C--Investment income--net $ 134 $ 353 $ 847 $ 1,032 $ 687 ========= ========= ========= ========= ========= Series D--Investment income--net $ 152 $ 504 $ 850 $ 1,035 $ 694 ========= ========= ========= ========= ========= Series E--Investment income--net $ 133 $ 346 $ 805 $ 1,038 $ 627 ========= ========= ========= ========= ========= Series F--Investment income--net $ 141 $ 324++ -- -- -- ========= ========= ========= ========= ========= *Annualized. **Do not reflect the effect of dividends to Preferred Stock shareholders. ***Total investment returns based on market value, which can be significantly greater or lesser than the net asset value, may result in substantially different returns. Total investment returns exclude the effects of sales charges. ++Series F was issued on November 19, 2001. ++++Certain prior year amounts have been reclassified to conform to current year presentation. +++Aggregate total investment return. +++++Based on average shares outstanding. See Notes to Financial Statements.
MuniYield Fund, Inc., April 30, 2003 NOTES TO FINANCIAL STATEMENTS 1. Significant Accounting Policies: MuniYield Fund, Inc. (the "Fund") is registered under the Investment Company Act of 1940 as a non-diversified, closed-end management investment company. The Fund's financial statements are prepared in conformity with accounting principles generally accepted in the United States of America, which may require the use of management accruals and estimates. These unaudited financial statements reflect all adjustments, which are, in the opinion of management, necessary to a fair statement of the results for the interim period presented. All such adjustments are of a normal, recurring nature. The Fund determines and makes available for publication the net asset value of its Common Stock on a weekly basis. The Fund's Common Stock is listed on the New York Stock Exchange under the symbol MYD. The following is a summary of significant accounting policies followed by the Fund. (a) Valuation of investments--Municipal bonds are traded primarily in the over-the-counter markets and are valued at the most recent bid price or yield equivalent as obtained by the Fund's pricing service from dealers that make markets in such securities. Financial futures contracts and options thereon, which are traded on exchanges, are valued at their closing price as of the close of such exchanges. Options written or purchased are valued at the last sale price in the case of exchange-traded options. In the case of options traded in the over-counter-market, valuation is the last asked price (options written) or the last bid price (options purchased). Securities with remaining maturities of sixty days or less are valued at amortized cost, which approximates market value. Securities and assets for which market quotations are not readily available are valued at their fair value as determined in good faith by or under the direction of the Board of Directors of the Fund, including valuations furnished by a pricing service retained by the Fund, which may utilize a matrix system for valuations. The procedures of the pricing service and its valuations are reviewed by the officers of the Fund under the general supervision of the Board of Directors. (b) Derivative financial instruments--The Fund may engage in various portfolio investment strategies both to increase the return of the Fund and to hedge, or protect, its exposure to interest rate movement and movements in the securities markets. Losses may arise due to changes in the value of the contract or if the counterparty does not perform under the contract. * Financial futures contracts--The Fund may purchase or sell financial futures contracts and options on such futures contracts. Futures contracts are contracts for delayed delivery of securities at a specific future date and at a specific price or yield. Upon entering into a contract, the Fund deposits and maintains as collateral such initial margin as required by the exchange on which the transaction is effected. Pursuant to the contract, the Fund agrees to receive from or pay to the broker an amount of cash equal to the daily fluctuation in value of the contract. Such receipts or payments are known as variation margin and are recorded by the Fund as unrealized gains or losses. When the contract is closed, the Fund records a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the value at the time it was closed. * Options--The Fund is authorized to write covered call options and purchase put options. When the Fund writes an option, an amount equal to the premium received by the Fund is reflected as an asset and an equivalent liability. The amount of the liability is subsequently marked to market to reflect the current market value of the option written. When a security is purchased or sold through an exercise of an option, the related premium paid (or received) is added to (or deducted from) the basis of the security acquired or deducted from (or added to) the proceeds of the security sold. When an option expires (or the Fund enters into a closing transaction), the Fund realizes a gain or loss on the option to the extent of the premiums received or paid (or gain or loss to the extent the cost of the closing transaction exceeds the premium paid or received). Written and purchased options are non-income producing investments. * Forward interest rate swaps--The Fund is authorized to enter into forward interest rate swaps. In a forward interest rate swap, the Fund and the counterparty agree to pay or receive interest on a specified notional contract amount, commencing on a specified future effective date, unless terminated earlier. The value of the agreement is determined by quoted fair values received daily by the Fund from the counterparty. When the agreement is closed, the Fund records a realized gain or loss in an amount equal to the value of the agreement. (c) Income taxes--It is the Fund's policy to comply with the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its taxable income to its shareholders. Therefore, no Federal income tax provision is required. (d) Security transactions and investment income--Security transactions are recorded on the dates the transactions are entered into (the trade dates). Realized gains and losses on security transactions are determined on the identified cost basis. Dividend income is recorded on the ex-dividend dates. Interest income is recognized on the accrual basis. The Fund amortizes all premiums and discounts on debt securities. (e) Dividends and distributions--Dividends from net investment income are declared and paid monthly. Distributions of capital gains are recorded on the ex-dividend dates. 2. Investment Advisory Agreement and Transactions with Affiliates: The Fund has entered into an Investment Advisory Agreement with Fund Asset Management, L.P. ("FAM"). The general partner of FAM is Princeton Services, Inc. ("PSI"), an indirect, wholly-owned subsidiary of Merrill Lynch & Co., Inc. ("ML & Co."), which is the limited partner. FAM is responsible for the management of the Fund's portfolio and provides the necessary personnel, facilities, equipment and certain other services necessary to the operations of the Fund. For such services, the Fund pays a monthly fee at an annual rate of .50% of the Fund's average weekly net assets, including proceeds from the issuance of Preferred Stock. For the six months ended April 30, 2003, FAM reimbursed the Fund in the amount of $559. For the six months ended April 30, 2003, the Fund reimbursed FAM $9,973 for certain accounting services. Certain officers and/or directors of the Fund are officers and/or directors of FAM, PSI, and/or ML & Co. 3. Investments: Purchases and sales of investments, excluding short-term securities, for the six months ended April 30, 2003 were $197,753,648 and $232,639,278, respectively. Net realized losses for the six months ended April 30, 2003 and net unrealized gains (losses) as of April 30, 2003 were as follows: Realized Unrealized Losses Gains (Losses) Long-term investments $ (3,122,981) $ 31,065,539 Financial futures contracts (1,354,485) -- Forward interest rate swaps (3,517,115) (1,092,731) ------------- ------------- Total $ (7,994,581) $ 29,972,808 ============= ============= As of April 30, 2003, net unrealized appreciation for Federal income tax purposes aggregated $31,364,239, of which $53,770,754 related to appreciated securities and $22,406,515 related to depreciated securities. The aggregate cost of investments at April 30, 2003 for Federal income tax purposes was $833,669,968. 4. Stock Transactions: The Fund is authorized to issue 200,000,000 shares of stock, including Preferred Stock, par value $.10 per share, all of which were initially classified as Common Stock. The Board of Directors is authorized, however, to reclassify any unissued shares of stock without approval of the holders of Common Stock. Common Stock Shares issued and outstanding during the six months ended April 30, 2003 remained constant and for the year ended October 31, 2002 increased by 5,508,830 as a result of issuance of Common Stock from reorganization and 207,485 as a result of dividend reinvestment. Preferred Stock Auction Market Preferred Stock ("AMPS") are redeemable shares of Preferred Stock of the Fund, with a par value of $.05 per share and a liquidation preference of $25,000 per share, plus accrued and unpaid dividends, that entitle their holders to receive cash dividends at an annual rate that may vary for the successive dividend periods. The yields in effect at April 30, 2003 were as follows: Series A, .949%; Series B, 1.15%; Series C, .965%; Series D, 1.05%; Series E, 1.15% and Series F, 1.15%. MuniYield Fund, Inc., April 30, 2003 NOTES TO FINANCIAL STATEMENTS (concluded) Shares issued and outstanding during the six months ended April 30, 2003 remained constant and during the year ended October 31, 2002 increased by 1,720 as a result of issuance of Preferred Stock from reorganization. The Fund pays commissions to certain broker-dealers at the end of each auction at an annual rate ranging from .25% to .375%, calculated on the proceeds of each auction. For the six months ended April 30, 2003, Merrill Lynch, Pierce, Fenner & Smith Incorporated, an affiliate of FAM, earned $180,919 as commissions. 5. Capital Loss Carryforward: On October 31, 2002, the Fund had a net capital loss carryforward of $65,766,287, of which $3,822,310 expires in 2006, $14,903,466 expires in 2007, $40,851,001 expires in 2008, $6,000,235 expires in 2009 and $189,275 expires in 2010. This amount will be available to offset like amounts of any future taxable gains. 6. Subsequent Event: The Fund paid a tax-exempt income dividend to holders of Common Stock in the amount of $.078000 per share on May 29, 2003 to shareholders of record on May 16, 2003. MANAGED DIVIDEND POLICY The Fund's dividend policy is to distribute all or a portion of its net investment income to its shareholders on a monthly basis. In order to provide shareholders with a more consistent yield to the current trading price of shares of Common Stock of the Fund, the Fund may at times pay out less than the entire amount of net investment income earned in any particular month and may at times in any month pay out such accumulated but undistributed income in addition to net investment income earned in that month. As a result, the dividends paid by the Fund for any particular month may be more or less than the amount of net investment income earned by the Fund during such month. The Fund's current accumulated but undistributed net investment income, if any, is disclosed in the Statement of Net Assets, which comprises part of the Financial Information included in this report. QUALITY PROFILE The quality ratings of securities in the Fund as of April 30, 2003 were as follows: Percent of S&P Rating/Moody's Rating Total Investments AAA/Aaa 37.6% AA/Aaa 12.3 A/A 16.6 BBB/Baa 8.8 BB/Ba 7.4 B/B 1.2 CCC/Caa 1.4 NR (Not Rated) 12.7 Other* 2.0 *Temporary investments in short-term municipal securities. MuniYield Fund, Inc., April 30, 2003 OFFICERS AND DIRECTORS Terry K. Glenn, President and Director James H. Bodurtha, Director Joe Grills, Director Herbert I. London, Director Andre F. Perold, Director Roberta Cooper Ramo, Director Robert S. Salomon, Jr., Director Stephen B. Swensrud, Director Kenneth A. Jacob, Senior Vice President John M. Loffredo, Senior Vice President Roberto W. Roffo, Vice President Donald C. Burke, Vice President and Treasurer Brian D. Stewart, Secretary Melvin R. Seiden, Director of MuniYield Fund, Inc., has recently retired. The Fund's Board of Directors wishes Mr. Seiden well in his retirement. Custodian The Bank of New York 100 Church Street New York, NY 10286 Transfer Agents Common Stock: The Bank of New York 101 Barclay Street New York, NY 10286 Preferred Stock: The Bank of New York 100Church Street New York, NY 10286 NYSE Symbol MYD Item 2 - Did registrant adopt a code of ethics, as of the end of the period covered by this report, that applies to the registrant's principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the registrant or a third party? If not, why not? Briefly describe any amendments or waivers that occurred during the period. State here if code of ethics/amendments/waivers are on website and give website address-. State here if fund will send code of ethics to shareholders without charge upon request--N/A (not answered until July 15, 2003 and only annually for funds) Item 3 - Did the registrant's board of directors determine that the registrant either: (i) has at least one audit committee financial expert serving on its audit committee; or (ii) does not have an audit committee financial expert serving on its audit committee? If yes, disclose name of financial expert and whether he/she is "independent," (fund may, but is not required, to disclose name/independence of more than one financial expert) If no, explain why not. -N/A (not answered until July 15, 2003 and only annually for funds) Item 4 - Disclose annually only (not answered until December 15, 2003) (a) Audit Fees - Disclose aggregate fees billed for each of the last two fiscal years for professional services rendered by the principal accountant for the audit of the registrant's annual financial statements or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for those fiscal years. N/A. (b) Audit-Related Fees - Disclose aggregate fees billed in each of the last two fiscal years for assurance and related services by the principal accountant that are reasonably related to the performance of the audit of the registrant's financial statements and are not reported under paragraph (a) of this Item. Registrants shall describe the nature of the services comprising the fees disclosed under this category. N/A. (c) Tax Fees - Disclose aggregate fees billed in each of the last two fiscal years for professional services rendered by the principal accountant for tax compliance, tax advice, and tax planning. Registrants shall describe the nature of the services comprising the fees disclosed under this category. N/A. (d) All Other Fees - Disclose aggregate fees billed in each of the last two fiscal years for products and services provided by the principal accountant, other than the services reported in paragraphs (a) through (c) of this Item. Registrants shall describe the nature of the services comprising the fees disclosed under this category. N/A. (e)(1) Disclose the audit committee's pre-approval policies and procedures described in paragraph (c)(7) of Rule 2-01 of Regulation S-X. N/A. (e)(2) Disclose the percentage of services described in each of paragraphs (b) through (d) of this Item that were approved by the audit committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X. N/A. (f) If greater than 50%, disclose the percentage of hours expended on the principal accountant's engagement to audit the registrant's financial statements for the most recent fiscal year that were attributed to work performed by persons other than the principal accountant's full-time, permanent employees. N/A. (g) Disclose the aggregate non-audit fees billed by the registrant's accountant for services rendered to the registrant, and rendered to the registrant's investment adviser (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the adviser that provides ongoing services to the registrant for each of the last two fiscal years of the registrant. N/A. (h) Disclose whether the registrant's audit committee has considered whether the provision of non-audit services that were rendered to the registrant's investment adviser (not including any subadviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the registrant that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with maintaining the principal accountant's independence. N/A. Item 5 - If the registrant is a listed issuer as defined in Rule 10A- 3 under the Exchange Act, state whether or not the registrant has a separately-designated standing audit committee established in accordance with Section 3(a)(58)(A) of the Exchange Act. If the registrant has such a committee, however designated, identify each committee member. If the entire board of directors is acting as the registrant's audit committee in Section 3(a)(58)(B) of the Exchange Act, so state. If applicable, provide the disclosure required by Rule 10A-3(d) under the Exchange Act regarding an exemption from the listing standards for audit committees. (Listed issuers must be in compliance with the new listing rules by the earlier of their first annual shareholders meeting after January 2004, or October 31, 2004 (annual requirement)) Item 6 - Reserved Item 7 - For closed-end funds that contain voting securities in their portfolio, describe the policies and procedures that it uses to determine how to vote proxies relating to those portfolio securities. N/A (not answered until July 1, 2003) Item 8--Reserved Item 9(a) - The registrant's certifying officers have reasonably designed such disclosure controls and procedures to ensure material information relating to the registrant is made known to us by others particularly during the period in which this report is being prepared. The registrant's certifying officers have determined that the registrant's disclosure controls and procedures are effective based on our evaluation of these controls and procedures as of a date within 90 days prior to the filing date of this report. Item 9(b)--There were no significant changes in the registrant's internal controls or in other factors that could significantly affect these controls subsequent to the date of their evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. Item 10 - Exhibits 10(a) - Attach code of ethics or amendments/waivers, unless code of ethics or amendments/waivers is on website or offered to shareholders upon request without charge. N/A. 10(b) - Attach certifications pursuant to Section 302 of the Sarbanes-Oxley Act. Attached hereto. Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. MuniYield Fund, Inc. By: _/s/ Terry K. Glenn_______ Terry K. Glenn, President of MuniYield Fund, Inc. Date: June 23, 2003 Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. By: _/s/ Terry K. Glenn________ Terry K. Glenn, President of MuniYield Fund, Inc. Date: June 23, 2003 By: _/s/ Donald C. Burke________ Donald C. Burke, Chief Financial Officer of MuniYield Fund, Inc. Date: June 23, 2003 Attached hereto as an exhibit are the certifications pursuant to Section 906 of the Sarbanes-Oxley Act. EX-99.CERT 3 ex99cert.txt EX-99 CERT EX-99. CERT CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002 I, Terry K. Glenn, President of MuniYield Fund, Inc., certify that: 1. I have reviewed this report on Form N-CSR of MuniYield Fund, Inc. (the "Fund"); 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; and 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the Fund as of, and for, the periods presented in this report; 4. The Fund's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-2(c) under the Investment Company Act of 1940) for the Fund and have: a) designed such disclosure controls and procedures to ensure that material information relating to the Fund, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; b) evaluated the effectiveness of the Fund's disclosure controls and procedures as of a date within 90 days prior to the filing date of this report (the "Evaluation Date"); and c) presented in this report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date; 5. The Fund's other certifying officers and I have disclosed, based on our most recent evaluation, to the Fund's auditors and the audit committee of the Fund's board of directors (or persons performing the equivalent functions): a) all significant deficiencies in the design or operation of internal controls which could adversely affect the Fund's ability to record, process, summarize, and report financial data and have identified for the Fund's auditors any material weaknesses in internal controls; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in the Fund's internal controls; and 6. The Fund's other certifying officers and I have indicated in this report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. Date: June 23, 2003 /s/ Terry K. Glenn Terry K. Glenn, President of MuniYield Fund, Inc. EX-99. CERT CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002 I, Donald C. Burke, Chief Financial Officer of MuniYield Fund, Inc., certify that: 1. I have reviewed this report on Form N-CSR of MuniYield Fund, Inc. (the "Fund"); 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the Fund as of, and for, the periods presented in this report; 4. The Fund's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-2(c) under the Investment Company Act of 1940) for the Fund and have: a) designed such disclosure controls and procedures to ensure that material information relating to the Fund, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; b) evaluated the effectiveness of the Fund's disclosure controls and procedures as of a date within 90 days prior to the filing date of this report (the "Evaluation Date"); and c) presented in this report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date; 5. The Fund's other certifying officers and I have disclosed, based on our most recent evaluation, to the Fund's auditors and the audit committee of the Fund's board of directors (or persons performing the equivalent functions): a) all significant deficiencies in the design or operation of internal controls which could adversely affect the Fund's ability to record, process, summarize, and report financial data and have identified for the Fund's auditors any material weaknesses in internal controls; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in the Fund's internal controls; and 6. The Fund's other certifying officers and I have indicated in this report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. Date: June 23, 2003 /s/ Donald C. Burke Donald C. Burke, Chief Financial Officer of MuniYield Fund, Inc. Exhibit 99.1350CERT Certification Pursuant to Section 906 of the Sarbanes Oxley Act I, Terry K. Glenn, President of MuniYield Fund, Inc. (the "Fund"), certify that: 1. The N-CSR of the Fund (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and 2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Fund. Dated: June 23, 2003 /s/ Terry K. Glenn Terry K. Glenn, President of MuniYield Fund, Inc. A signed original of this written statement required by Section 906 has been provided to MuniYield Fund, Inc. and will be retained by MuniYield Fund, Inc. and furnished to the Securities and Exchange Commission or staff upon request. Exhibit 99.1350CERT Certification Pursuant to Section 906 of the Sarbanes Oxley Act I, Donald C. Burke, Chief Financial Officer of MuniYield Fund, Inc. (the "Fund"), certify that: 1. The N-CSR of the Fund (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and 2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Fund. Dated: June 23, 2003 /s/ Donald C. Burke Donald C. Burke, Chief Financial Officer of MuniYield Fund, Inc. A signed original of this written statement required by Section 906 has been provided to MuniYield Fund, Inc. and will be retained by MuniYield Fund, Inc. and furnished to the Securities and Exchange Commission or staff upon request. -----END PRIVACY-ENHANCED MESSAGE-----