-----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, JkbyxbNCJQIF0kl1qrnil4p5F+wUPfHF2T2RwjUetjrsGzRQeKhPXjW9ecLX+vv3 3tI4PM1Mf8iR7Vfby0yn6g== /in/edgar/work/20000612/0001005477-00-004630/0001005477-00-004630.txt : 20000919 0001005477-00-004630.hdr.sgml : 20000919 ACCESSION NUMBER: 0001005477-00-004630 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20000430 FILED AS OF DATE: 20000612 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MUNIYIELD NEW YORK INSURED FUND INC CENTRAL INDEX KEY: 0000882150 STANDARD INDUSTRIAL CLASSIFICATION: [0000 ] IRS NUMBER: 223144223 STATE OF INCORPORATION: NJ FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: N-30D SEC ACT: SEC FILE NUMBER: 811-06500 FILM NUMBER: 653610 BUSINESS ADDRESS: STREET 1: 800 SCUDDERS MILL RD CITY: PLAINSBORO STATE: NJ ZIP: 08536 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 FORMER COMPANY: FORMER CONFORMED NAME: NEW YORK MUNIYIELD FUND INC DATE OF NAME CHANGE: 19600201 N-30D 1 0001.txt SEMI-ANNUAL REPORT MUNIYIELD NEW YORK INSURED FUND, INC. STRATEGIC Performance [GRAPHIC OMITTED] Semi-Annual Report April 30, 2000 MUNIYIELD NEW YORK INSURED FUND, INC. The Benefits and Risks of Leveraging MuniYield New York Insured 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 strong, 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 on 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 these securities. MuniYield New York Insured Fund, Inc., April 30, 2000 TO OUR SHAREHOLDERS For the six months ended April 30, 2000, the Common Stock of MuniYield New York Insured Fund, Inc. earned $0.393 per share income dividends, which included earned and unpaid dividends of $0.064. This represents a net annualized yield of 6.03%, based on a month-end per share net asset value of $13.08. Over the same period, the total investment return on the Fund's Common Stock was +3.87%, based on a change in per share net asset value from $13.02 to $13.08, and assuming reinvestment of $0.400 per share income dividends. The average yields for the Fund's Auction Market Preferred Stock for the six months ended April 30, 2000 were: Series A, 3.41%; Series B, 3.63%; Series C, 4.04%; Series D, 3.44%; and Series E, 2.13%. The Municipal Market Environment Since October 1999 through mid-January 2000, fixed-income bond yields rose steadily higher. US economic growth, in part intensified by Year 2000 preparations, grew at a 7.3% rate in the fourth quarter of 1999 and at a 4.2% annual rate for all of 1999. Initial estimates for the first quarter of 2000 were reported at 5.4%. However, despite these significant growth rates, no price measure indicator has shown any considerable signs of future price pressures at the consumer level, despite the lowest unemployment rates since January 1970. Given no signs of an economic slowdown, the Federal Reserve Board continued to raise short-term interest rates in November 1999 and again in February and March 2000. In each instance, the Federal Reserve Board cited both the continued growth of US employment and the impressive strength of the US equity markets as reasons for attempting to moderate US economic growth before inflationary price increases are realized. By mid-January 2000, US Treasury bond yields rose 60 basis points (0.60%) to 6.75%. Similarly, as measured by the Bond Buyer Revenue Bond Index, long-term tax-exempt bond yields rose approximately 20 basis points to 6.35%. Since mid-January, fixed-income markets have largely ignored strong economic fundamentals and concentrated on very positive technical supply factors. Declining bond issuance, both current, and more importantly, expected future issuance, helped push bond yields lower from mid-January to mid-April 2000. In late January and early February 2000, the US Treasury announced its intention to reduce the number of issues to be auctioned in the quarterly Treasury note and bond auctions. Furthermore, budgetary surpluses would allow the US Treasury to repurchase outstanding, higher-couponed Treasury issues, primarily in the 15-year and longer-term maturity sectors. Both these actions would result in a significant reduction in the outstanding supply of long-term US Treasury debt. Domestic and international investors quickly began to accumulate what was expected to become a scarce commodity and bond prices quickly rose. By mid-April 2000, US Treasury bond yields had declined over 100 basis points to 5.67%. However, bond yields rose somewhat during the last two weeks of the period as economic statistics were released, indicating that the economic strength seen in late 1999 was continuing into early 2000. The decline in long-term US Treasury bond yields resulted in an inverted taxable yield curve as short-term and intermediate-term interest rates have not fallen proportionately since the Federal Reserve Board is expected to continue to raise short-term interest rates. The current inversion has had much more to do with debt reduction and Treasury buybacks than with investor expectations of slower economic growth. Over the last six months, long-term US Treasury bond yields have fallen almost 20 basis points to close the six-month period ended April 30, 2000 at 5.96%. Tax-exempt bond yields have also declined in recent months. The decline has largely been in response to the rally in US Treasury securities, as well as a continued positive technical supply environment. States such as California and Maryland have announced that their large current and anticipated future budget surpluses will permit the cancellation or postponement of expected bond issuance. Additionally, some issuers have also initiated tenders to repurchase existing debt, reducing the supply of tax-exempt bonds in the secondary market as well. Since their recent peak in January 2000, long-term municipal bond yields declined over 25 basis points to finish the six-month period ended April 30, 2000 at 6.07%. During the last six months, municipal bond yields declined just 10 basis points overall. The relative underperformance of the municipal bond market in recent months has been especially disappointing given the strong technical position the tax-exempt bond market enjoyed. The issuance of long-term tax-exempt securities has dramatically declined. Over the last year, $203 billion in new long-term municipal securities was issued, a decline of almost 25% compared to the same period a year earlier. For the six months ended April 30, 2000, approximately $90 billion in new tax-exempt bonds was underwritten, a decline of more than 25% compared to the same period in 1999. Although investors received over $30 billion in coupon payments, bond maturities, and the proceeds from early bond redemptions, coupled with the highest municipal bond yields in three years, overall investor demand has diminished. Long-term municipal bond mutual funds have seen consistent outflows in recent months as the yields of individual securities have risen faster than those of larger, more diverse mutual funds. Over the last four months, tax-exempt mutual funds have had net redemptions of more than $8 billion. Also, the demand from property and casualty insurance companies has weakened as a result of the losses and anticipated losses incurred from a series of damaging storms across much of the eastern United States. Additionally, many institutional investors who have in recent years been attracted to the municipal bond market by historically attractive tax-exempt bond yield ratios of over 90% found other asset classes even more attractive. Even with a favorable supply position, tax-exempt municipal bond yields have underperformed their taxable counterparts. Any significantly lower municipal bond yields are still likely to require weaker US employment growth and consumer spending. The actions taken in recent months by the Federal Reserve Board should eventually slow US economic growth. The recent declines in US home sales are perhaps the first sign that consumer spending is being slowed by higher interest rates. Until further signs develop, it is likely that the municipal bond market's current favorable technical position will dampen significant tax-exempt interest rate volatility and provide a stable environment for eventual improvement in municipal bond prices. Portfolio Strategy During the six-month period ended April 30, 2000, we managed the Fund with the intent of sustaining an attractive level of tax-exempt income for the shareholders. Our strategy for the Fund was to remain invested in the highest-yielding bonds that could be purchased without relinquishing the credit quality of the Fund as well as to maintain a neutral portfolio structure. We accomplished this by purchasing higher coupon bonds in the 10-year - 15-year maturity range and selling lower coupon bonds in the 20-year - 30-year maturity range. These transactions were done with a minimal sacrifice in yield. This strategy proved advantageous throughout the period because although the market experienced interest rate volatility, we were able to increase the Fund's income without being subjected to the intense volatility. The Fund's cost of borrowing increased somewhat in recent months as short-term tax-exempt interest rates rose along with the adjustment evident in the taxable market. Long-term tax-exempt interest rates have actually declined modestly, causing the municipal yield curve to flatten. While this flattening has reduced the incremental yield enhancement resulting from leveraging the Fund's Common Stock, it is important to note that in contrast to the inverted shape of the US Treasury yield curve, the municipal yield curve remained positively sloped. (For a complete explanation of the benefits and risks of leveraging, see page 1 of this report to shareholders.) 2 & 3 MuniYield New York Insured Fund, Inc., April 30, 2000 Looking ahead, we believe that interest rates will remain volatile until investors regain confidence that the Federal Reserve Board has inflation under control. Within this environment, we anticipate that there will be investment opportunities to purchase bonds at attractive levels that may enhance the Fund's total return when interest rates return to lower levels. We plan to maintain our neutral position and purchase longer duration bonds when interest rates rise to levels that are not consistent with the current economic activity. In Conclusion We appreciate your ongoing interest in MuniYield New York Insured Fund, Inc., and we look forward to serving your investment needs in the months and years to come. Sincerely, /s/ Terry K. Glenn Terry K. Glenn President and Director /s/ Vincent R. Giordano Vincent R. Giordano Senior Vice President /s/ Roberto Roffo Roberto Roffo Portfolio Manager May 31, 2000 Effective March 6, 2000, Roberto Roffo became responsible for the day-to-day management of MuniYield New York Insured Fund, Inc. Mr. Roffo has been employed by Merrill Lynch Asset Management, L.P. since 1996 as Vice President and since 1992 as Portfolio Manager. PROXY RESULTS During the six-month period ended April 30, 2000, MuniYield New York Insured Fund, Inc.'s Common Stock shareholders voted on the following proposals. Proposals 1 and 2 were approved at a shareholders' meeting on April 27, 2000. Proposal 3 was approved on January 20, 2000. The description of each 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 7,031,510 183,498 James H. Bodurtha 7,029,760 185,248 Herbert I. London 7,030,863 184,145 Roberta Cooper Ramo 7,030,131 184,877 Arthur Zeikel 7,031,288 183,720 - ------------------------------------------------------------------------------------------------------------------------------------ Shares Voted Shares Voted Shares Voted For Against Abstain - ------------------------------------------------------------------------------------------------------------------------------------ 2. To ratify the selection of Deloitte & Touche LLP as the Fund's independent auditors for the current fiscal year. 7,064,826 78,956 71,226 - ------------------------------------------------------------------------------------------------------------------------------------ 3. To approve the Agreement and Plan of Reorganization between the Fund and MuniYield New York Insured Fund II, Inc. 6,488,949 328,773 327,139 - ------------------------------------------------------------------------------------------------------------------------------------
During the six-month period ended April 30, 2000, MuniYield New York Insured Fund, Inc.'s Preferred Stock shareholders voted on the following proposals. Proposals 1 and 2 were approved at a shareholders' meeting on April 27, 2000. Proposal 3 was approved on January 20, 2000. The description of each 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, Herbert I. London, Joseph L. May, Andre F. Perold, Roberta Cooper Ramo and Arthur Zeikel as follows: Series A 1,080 0 Series B 838 0 - ------------------------------------------------------------------------------------------------------------------------------------ Shares Voted Shares Voted Shares Voted For Against Abstain - ------------------------------------------------------------------------------------------------------------------------------------ 2. To ratify the selection of Deloitte & Touche LLP as the Fund's independent auditors for the current fiscal year as follows: Series A 1,080 0 0 Series B 838 0 0 - ------------------------------------------------------------------------------------------------------------------------------------ 3. To approve the Agreement and Plan of Reorganization between the Fund and MuniYield New York Insured Fund II, Inc. as follows: Series A 1,687 0 13 Series B 1,546 60 94 - ------------------------------------------------------------------------------------------------------------------------------------
4 & 5 MuniYield New York Insured Fund, Inc., April 30, 2000 SCHEDULE OF INVESTMENTS (in Thousands) STATE New York--101.2%
S&P Moody's Face Ratings Ratings Amount Issue Value - ------------------------------------------------------------------------------------------------------------------------------------ NR* Aaa $11,895 Albany County, New York, Airport Authority, Airport Revenue Bonds, RITR, AMT, Series RI-7, 6.37% due 12/15/2023 (d)(e) $ 11,833 - ------------------------------------------------------------------------------------------------------------------------------------ AAA Aaa 8,200 Buffalo and Fort Erie, New York, Public Bridge Authority, Toll Bridge System Revenue Bonds, 5.75% due 1/01/2025 (b) 8,009 - ------------------------------------------------------------------------------------------------------------------------------------ AAA Aaa 1,995 Buffalo, New York, Municipal Water Finance Authority, Water System Revenue Refunding Bonds, Series B, 5% due 7/01/2026 (f) 1,724 - ------------------------------------------------------------------------------------------------------------------------------------ AAA Aaa 4,300 Buffalo, New York, Sewer Authority, Revenue Refunding Bonds, Series F, 6% due 7/01/2013 (f) 4,570 - ------------------------------------------------------------------------------------------------------------------------------------ AAA Aaa 1,700 Dutchess County, New York, Resource Recovery Agency Revenue Bonds (Solid Waste System-- Forward), Series A, 5.40% due 1/01/2013 (b) 1,673 - ------------------------------------------------------------------------------------------------------------------------------------ Huntington, New York, GO, Refunding (a): NR* Aaa 715 5.50% due 4/15/2010 729 NR* Aaa 485 5.50% due 4/15/2011 494 NR* Aaa 460 5.50% due 4/15/2012 467 NR* Aaa 455 5.50% due 4/15/2013 461 NR* Aaa 450 5.50% due 4/15/2014 454 NR* Aaa 450 5.50% due 4/15/2015 452 - ------------------------------------------------------------------------------------------------------------------------------------ Long Island Power Authority, New York, Electric System Revenue Refunding Bonds: AAA Aaa 14,000 5.25% due 4/01/2010 (b) 13,946 AAA Aaa 10,950 Series A, 5.50% due 12/01/2010 (a) 11,134 AAA Aaa 4,675 Series A, 5% due 12/01/2015 (e) 4,317 AAA Aaa 10,000 Series A, 5.50% due 12/01/2023 (b) 9,421 AAA Aaa 5,000 Series A, 5.25% due 12/01/2026 (a) 4,492 AAA Aaa 10,175 Series A, 5.50% due 12/01/2029 (b) 9,474 - ------------------------------------------------------------------------------------------------------------------------------------ Metropolitan Transportation Authority, New York, Commuter Facilities Revenue Bonds, Series A: AAA Aaa 2,070 6.375% due 7/01/2004 (b)(g) 2,203 AAA NR* 7,945 5.50% due 7/01/2014 (f) 7,913 AAA Aaa 2,000 5.75% due 7/01/2021 (b) 1,973 - ------------------------------------------------------------------------------------------------------------------------------------ AAA Aaa 3,000 Metropolitan Transportation Authority, New York, Dedicated Tax Fund Revenue Bonds, Series A, 4.75% due 4/01/2028 (f) 2,473 - ------------------------------------------------------------------------------------------------------------------------------------ Metropolitan Transportation Authority, New York, Transit Facilities Revenue Bonds: AAA Aaa 2,400 Series A, 6.10% due 7/01/2006 (e)(g) 2,561 AAA Aaa 5,605 Series A, 5.75% due 7/01/2021 (b) 5,550 AAA Aaa 2,500 Series C-1, 5.50% due 7/01/2022 (f) 2,377 - ------------------------------------------------------------------------------------------------------------------------------------ Metropolitan Transportation Authority, New York, Transit Facilities Revenue Refunding Bonds: AAA Aaa 5,000 Series A, 4.75% due 7/01/2024 (b) 4,157 AAA Aaa 350 Series B, 4.75% due 7/01/2026 (f) 289 - ------------------------------------------------------------------------------------------------------------------------------------ Monroe County, New York, IDA, Revenue Bonds (Southview Towers Project), AMT: NR* Aa1 1,400 6.125% due 2/01/2020 1,377 NR* Aa1 1,125 6.25% due 2/01/2031 1,107 - ------------------------------------------------------------------------------------------------------------------------------------ AA Aa2 5,000 Municipal Assistance Corporation for the City of New York, Revenue Refunding Bonds, Series L, 6% due 7/01/2007 5,252 - ------------------------------------------------------------------------------------------------------------------------------------ AAA Aaa 1,205 Nassau County, New York, GO, Series B, 5.25% due 6/01/2024 (a) 1,091 - ------------------------------------------------------------------------------------------------------------------------------------ AAA Aaa 4,700 Nassau Health Care Corporation, New York, Health System Revenue Bonds, 5.75% due 8/01/2029 (e) 4,570 - ------------------------------------------------------------------------------------------------------------------------------------ AAA Aaa 2,500 New York City, New York, City Health and Hospital Corporation, Health System Revenue Refunding Bonds, Series A, 5% due 2/15/2020 (a) 2,191 - ------------------------------------------------------------------------------------------------------------------------------------ NR* Aaa 5,750 New York City, New York, City IDA, Civic Facility Revenue Bonds (USTA National Tennis Center), RIB, Series 206, 7.36% due 11/15/2014 (d)(e) 6,310 - ------------------------------------------------------------------------------------------------------------------------------------ New York City, New York, City Municipal Water Finance Authority, Water and Sewer System Revenue Bonds: AAA Aaa 1,050 Series A, 5% due 6/15/2027 (f) 905 AAA Aaa 12,100 Series B, 5.75% due 6/15/2026 (b) 11,843 AAA Aaa 21,350 Series B, 5.50% due 6/15/2027 (b) 20,131 AAA Aaa 22,200 Series B, 5.75% due 6/15/2029 (b) 21,617 - ------------------------------------------------------------------------------------------------------------------------------------ New York City, New York, City Municipal Water Finance Authority, Water and Sewer System Revenue Refunding Bonds: AAA Aaa 5,000 Series A, 6% due 6/15/2010 (f) 5,283 AAA Aaa 3,210 Series B, 5.25% due 6/15/2011 (e) 3,178 AAA Aaa 1,750 Series D, 4.75% due 6/15/2025 (b) 1,448 AAA Aaa 1,000 Series D, 4.75% due 6/15/2025 (f) 828 A1+ VMIG1+ 3,000 VRDN, Series A, 6.10% due 6/15/2025 (c)(f) 3,000 - ------------------------------------------------------------------------------------------------------------------------------------ New York City, New York, City Transit Authority, Metropolitan Transportation Authority, Triborough, COP, Series A (a): AAA Aaa 4,260 5.625% due 1/01/2010 4,370 AAA Aaa 2,020 5.625% due 1/01/2012 2,053 - ------------------------------------------------------------------------------------------------------------------------------------ New York City, New York, City Transitional Finance Authority Revenue Bonds: AAA Aaa 5,000 Future Tax Secured, Series C, 5.50% due 5/01/2025 (f) 4,746 NR* VMIG1+ 1,000 Future Tax Secured, VRDN, Series C, 5.85% due 5/01/2028 (c) 1,000 NR* Aa3 7,500 RIB, Series 304, 7.11% due 11/15/2017 (d) 8,303 - ------------------------------------------------------------------------------------------------------------------------------------
Portfolio Abbreviations To simplify the listings of MuniYield New York Insured Fund, Inc.'s portfolio holdings in the Schedule of Investments, we have abbreviated the names of many of the securities according to the list below and at right. AMT Alternative Minimum Tax (subject to) COP Certificates of Participation DATES Daily Adjustable Tax-Exempt Securities GO General Obligation Bonds HFA Housing Finance Agency IDA Industrial Development Authority PCR Pollution Control Revenue Bonds RIB Residual Interest Bonds RITR Residual Interest Trust Receipts VRDN Variable Rate Demand Notes 6 & 7 MuniYield New York Insured Fund, Inc., April 30, 2000 SCHEDULE OF INVESTMENTS (continued) (in Thousands) STATE New York (continued)
S&P Moody's Face Ratings Ratings Amount Issue Value - ------------------------------------------------------------------------------------------------------------------------------------ New York City, New York, City Transitional Finance Authority, Revenue Refunding Bonds, Future Tax Secured, Series C: AA Aa3 $ 7,000 5.875% due 11/01/2015 $ 7,167 AA Aa3 5,000 5.875% due 11/01/2016 5,097 - ------------------------------------------------------------------------------------------------------------------------------------ New York City, New York, GO, Refunding: AAA Aaa 2,700 Series A, 5.30% due 8/01/2012 (f) 2,660 AAA NR* 380 Series B, 7% due 2/01/2002 (a)(g) 399 AAA Aaa 2,000 Series B, 7% due 2/01/2017 (a) 2,091 AAA NR* 1,620 Series B, 7% due 2/01/2018 (a) 1,694 AAA Aaa 5,000 Series H, 5.375% due 8/01/2027 (e) 4,592 A1+ VMIG1+ 4,300 VRDN, Sub-Series E-2, 6% due 8/01/2020 (c) 4,300 A1+ VMIG1+ 4,000 VRDN, Sub-Series E-3, 6% due 8/01/2023 (c) 4,000 A1+ VMIG1+ 800 VRDN, Sub-Series E-5, 6% due 8/01/2009 (c) 800 - ------------------------------------------------------------------------------------------------------------------------------------ New York City, New York, GO, VRDN (c): A1+ VMIG1+ 3,600 Sub-Series A-4, 5.50% due 8/01/2021 3,600 A1+ VMIG1+ 1,500 Sub-Series A-10, 6.10% due 8/01/2017 1,500 - ------------------------------------------------------------------------------------------------------------------------------------ A A3 14,970 New York City, New York, IDA, Special Facilities Revenue Bonds (Terminal One Group Association Project), AMT, 6.125% due 1/01/2024 14,904 - ------------------------------------------------------------------------------------------------------------------------------------ New York State Dormitory Authority, Hospital Revenue Refunding Bonds (Montefiore Medical Center) (a)(h): AAA Aaa 15,000 5.45% due 8/01/2029 13,821 AAA Aaa 9,660 5.50% due 8/01/2038 8,884 - ------------------------------------------------------------------------------------------------------------------------------------ New York State Dormitory Authority, Lease Revenue Bonds: AAA Aaa 4,000 (Municipal Health Facilities Improvement Program), Series 1, 5% due 1/15/2023 (e) 3,471 AAA Aaa 1,900 (Municipal Health Facilities Improvement Program), Series 1, 4.75% due 1/15/2029 (e) 1,546 AAA Aaa 2,000 (Municipal Health Facilities Improvement Program), Series A, 4.75% due 5/15/2024 (a) 1,662 AAA NR* 4,350 (Westchester County Municipal Court Facilities), 5.25% due 8/01/2017 (b) 4,095 - ------------------------------------------------------------------------------------------------------------------------------------ New York State Dormitory Authority Revenue Bonds: NR* Aaa 1,000 (Brooklyn Hospital Center), 5.10% due 2/01/2019 (a)(h) 897 AAA NR* 2,460 (Champlain Valley Physicians), 5% due 7/01/2017 (i) 2,218 AAA NR* 1,000 (City University System), Consolidated Third Generation, Series 1, 5.75% due 7/01/2013 (e) 1,021 AAA Aaa 3,000 (City University System), Third Resolution, Series 1, 6.25% due 7/01/2004 (a)(g) 3,192 AAA Aaa 6,290 (City University), Third Generation Reserves, Series 1, 6.30% due 7/01/2004 (a)(g) 6,681 AAA Aaa 4,250 (Eger Health Care and Rehabilitation Center), 6.10% due 8/01/2037 (h) 4,190 AAA Aaa 2,000 (Ithaca College), 5.25% due 7/01/2026 (a) 1,796 A A3 2,340 (Mental Health Services Facilities Improvement), Series B, 6% due 8/15/2016 2,416 AAA Aaa 4,350 (Mental Health Services Facilities Improvement), Series F, 4.50% due 8/15/2028 (a) 3,380 AAA Aaa 1,000 (Mental Health Services), Series B, 6.50% due 2/15/2011 (b) 1,102 A NR* 2,430 (Miriam Osborn Memorial Home), Series B, 6.875% due 7/01/2019 2,573 A NR* 6,110 (Miriam Osborn Memorial Home), Series B, 6.875% due 7/01/2025 6,477 AAA Aaa 4,000 (Mount Sinai School of Medicine), Series A, 5.15% due 7/01/2024 (b) 3,591 AAA Aaa 2,000 (New School Social Research), 5.75% due 7/01/2026 (b) 1,955 AAA Aaa 2,000 (State University Educational Facilities), Series B, 5.75% due 5/15/2004 (f)(g) 2,057 AAA Aaa 5,480 (State University Educational Facilities), Series B, 5.50% due 5/15/2016 (b) 5,400 AAA Aaa 2,000 (University Educational Facilities), Series C, 5.375% due 5/15/2013 (b) 1,973 - ------------------------------------------------------------------------------------------------------------------------------------ New York State Dormitory Authority, Revenue Refunding Bonds: AAA Aaa 13,230 (City University System), Consolidated Second Generation, Series A, 6.125% due 7/01/2012 (a) 14,049 AAA Aaa 4,400 (City University System), Series C, 7.50% due 7/01/2010 (f) 5,032 AAA Aaa 1,375 (Consolidated City University System), Second Generation, Series A, 5.75% due 7/01/2018 (e) 1,406 AAA Aaa 2,875 (Hamilton College), 4.75% due 7/01/2018 (b) 2,478 AAA NR* 4,250 (Hospital Mortgage--United Health Services Hospitals), 5.375% due 8/01/2027 (a)(h) 3,897 BBB+ Baa1 15,000 (Mount Sinai Health), Series A, 6.625% due 7/01/2018 15,193 AAA Aaa 4,340 (New York and Presbyterian Hospitals), 4.75% due 8/01/2027 (a)(h) 3,553 AAA Aaa 4,000 (North Shore University Hospital), 5.25% due 11/01/2019 (b) 3,671 AAA Aaa 12,145 RITR, Class R, Series 2, 7.049% due 7/01/2011 (a)(d) 13,820 AAA Aaa 8,870 (Saint John's University), 5.25% due 7/01/2025 (b) 8,021 AAA Aaa 5,250 (Saint John's University), 4.75% due 7/01/2028 (b) 4,292 AAA Aaa 5,850 (Saint Joseph's Hospital Health Center), 5.25% due 7/01/2018 (b) 5,411 AAA Aaa 6,000 (Siena College), 5.75% due 7/01/2026 (b) 5,865 AAA Aaa 1,500 (State University Educational Facilities), Series A, 5% due 5/15/2018 (b) 1,348 - ------------------------------------------------------------------------------------------------------------------------------------ New York State Energy Research and Development Authority, Facilities Revenue Refunding Bonds: AAA Aaa 4,155 (Consolidated Edison Co. of New York), Series A, 6.10% due 8/15/2020 (a) 4,223 NR* Aaa 4,200 RITR, Series 19, 6.67% due 8/15/2020 (a)(d) 4,338 - ------------------------------------------------------------------------------------------------------------------------------------ New York State Energy Research and Development Authority, Gas Facilities Revenue Bonds (Brooklyn Union Gas Company Project) (b): AAA Aaa 5,000 AMT, Series B, 6.75% due 2/01/2024 5,235 AAA Aaa 26,000 Series A, 5.50% due 1/01/2021 24,854 - ------------------------------------------------------------------------------------------------------------------------------------ New York State Energy Research and Development Authority, PCR (Niagara Mohawk Power Corporation Project) (c): A1+ NR* 600 DATES, Series A, 3.55% due 7/01/2015 600 A1+ NR* 18,700 VRDN, AMT, 3.60% due 12/01/2023 18,700 - ------------------------------------------------------------------------------------------------------------------------------------ New York State Energy Research and Development Authority, PCR, Refunding: AAA Aaa 3,500 (Central Hudson Gas and Electric), Series A, 5.45% due 8/01/2027 (a) 3,278 NR* P1 300 (Niagara Mohawk Power Corporation), VRDN, Series B, 6.10% due 12/01/2025 (c) 300 - ------------------------------------------------------------------------------------------------------------------------------------ NR* Aa1 5,000 New York State Environmental Facilities Corporation, PCR, Refunding, RITR, Series RI-1, 6.095% due 6/15/2014 (d) 5,192 - ------------------------------------------------------------------------------------------------------------------------------------ AAA Aaa 3,500 New York State Environmental Facilities Corporation, Special Obligation Revenue Refunding Bonds (Riverbank State Park), 6.25% due 4/01/2012 (a) 3,797 - ------------------------------------------------------------------------------------------------------------------------------------ AAA Aaa 2,745 New York State, HFA, Revenue Refunding Bonds, Housing Mortgage Project, Series A, 6.10% due 11/01/2015 (e) 2,802 - ------------------------------------------------------------------------------------------------------------------------------------ AAA Aaa 13,350 New York State Local Government Assistance Corporation Revenue Bonds, Series A, 6% due 4/01/2024 (a) 13,409 - ------------------------------------------------------------------------------------------------------------------------------------
8 & 9 MuniYield New York Insured Fund, Inc., April 30, 2000 SCHEDULE OF INVESTMENTS (concluded) (in Thousands) STATE New York (continued)
S&P Moody's Face Ratings Ratings Amount Issue Value - ------------------------------------------------------------------------------------------------------------------------------------ New York State Medical Care Facilities Finance Agency Revenue Bonds: AAA Aaa $ 2,485 (Brookdale Hospital Medical Center), Series A, 6.85% due 2/15/2005 (g) $ 2,707 AAA Aaa 5,375 (Health Center Project--Second Mortgage), Series A, 6.375% due 11/15/2019 (a) 5,568 AAA Aaa 1,475 (Mental Health Services), Series A, 6% due 2/15/2005 (b)(g) 1,554 AAA Aaa 25 (Mental Health Services), Series A, 6% due 2/15/2025 (b) 25 AAA Aaa 2,945 (Mental Health Services), Series E, 6.50% due 8/15/2004 (e)(g) 3,158 AAA Aaa 55 (Mental Health Services), Series E, 6.50% due 8/15/2015 (e) 58 AAA Aaa 10,100 (New York Hospital Mortgage), Series A, 6.80% due 2/15/2005 (a)(g)(h) 10,998 - ------------------------------------------------------------------------------------------------------------------------------------ New York State Medical Care Facilities Finance Agency, Revenue Refunding Bonds (Hospital & Nursing Homes) (h): AAA NR* 2,000 Series B, 6.25% due 2/15/2025 2,070 AAA Aaa 15,200 Series C, 6.375% due 8/15/2029 (b) 15,851 - ------------------------------------------------------------------------------------------------------------------------------------ AAA NR* 20,000 New York State Mortgage Agency, Homeowner Mortgage Revenue Bonds, AMT, Series 90, 6.35% due 10/01/2030 (b) 20,363 - ------------------------------------------------------------------------------------------------------------------------------------ NR* Aa1 22,430 New York State Mortgage Agency, Homeowner Mortgage Revenue Refunding Bonds, AMT, Series 67, 5.80% due 10/01/2028 21,438 - ------------------------------------------------------------------------------------------------------------------------------------ NR* Aa1 4,750 New York State Mortgage Agency, Revenue Refunding Bonds, AMT, Series 82, 5.65% due 4/01/2030 4,397 - ------------------------------------------------------------------------------------------------------------------------------------ AAA Aaa 2,000 New York State Thruway Authority, Highway and Bridge Trust Fund Revenue Bonds, Series A, 6.25% due 4/01/2011 (e) 2,151 - ------------------------------------------------------------------------------------------------------------------------------------ AAA Aaa 8,840 New York State Thruway Authority, Highway and Bridge Trust Fund Revenue Refunding Bonds, Series B, 5% due 4/01/2019 (f) 7,894 - ------------------------------------------------------------------------------------------------------------------------------------ AA- Aa3 19,000 New York State Thruway Authority Revenue Refunding Bonds, Series E, 5% due 1/01/2025 16,393 - ------------------------------------------------------------------------------------------------------------------------------------ New York State Thruway Authority, Service Contract Revenue Bonds (Local Highway and Bridges Project) (b): AAA Aaa 10,000 5.625% due 4/01/2012 10,159 AAA Aaa 10,000 Series A-2, 5.375% due 4/01/2010 10,057 AAA Aaa 2,000 Series A-2, 5.375% due 4/01/2016 1,939 - ------------------------------------------------------------------------------------------------------------------------------------ AAA Aaa 2,500 New York State Thruway Authority, Service Contract Revenue Refunding Bonds (Local Highway and Bridges Project), 6% due 4/01/2011 (b) 2,619 - ------------------------------------------------------------------------------------------------------------------------------------ New York State Urban Development Corporation Revenue Bonds (Correctional Facilities Service Contract) (a): AAA Aaa 6,520 Series B, 4.75% due 1/01/2018 5,620 AAA Aaa 2,000 Series C, 5.875% due 1/01/2019 2,009 - ------------------------------------------------------------------------------------------------------------------------------------ New York State Urban Development Corporation, Revenue Refunding Bonds (Correctional Capital Facilities) (e): AAA Aaa 2,000 5% due 1/01/2019 1,783 AAA Aaa 4,595 Series A, 6.50% due 1/01/2010 5,015 AAA Aaa 3,190 Series A, 6.50% due 1/01/2011 3,512 AAA Aaa 6,500 Series A, 5.25% due 1/01/2021 5,912 - ------------------------------------------------------------------------------------------------------------------------------------ AAA Aaa 1,000 Niagara Falls, New York, GO (Water Treatment Plant), AMT, 7.25% due 11/01/2010 (b) 1,142 - ------------------------------------------------------------------------------------------------------------------------------------ AAA Aaa 2,705 Niagara, New York, Frontier Authority, Airport Revenue Bonds (Buffalo Niagara International Airport), Series B, 5.50% due 4/01/2019 (b) 2,603 - ------------------------------------------------------------------------------------------------------------------------------------ AAA Aaa 1,260 North Country, New York, Development Authority, Solid Waste Management System Revenue Refunding Bonds, 6% due 5/15/2015 (e) 1,327 - ------------------------------------------------------------------------------------------------------------------------------------ North Hempstead, New York, GO, Refunding, Series B (f): AAA Aaa 1,745 6.40% due 4/01/2013 1,924 AAA Aaa 555 6.40% due 4/01/2017 609 - ------------------------------------------------------------------------------------------------------------------------------------ AAA Aaa 1,080 Oneida County, New York, GO, Refunding, 5.50% due 3/15/2009 (f) 1,098 - ------------------------------------------------------------------------------------------------------------------------------------ AAA Aaa 1,665 Oneida County, New York, IDA, Civic Facilities Revenue Bonds (Mohawk Valley), Series A, 5.20% due 2/01/2013 (e) 1,600 - ------------------------------------------------------------------------------------------------------------------------------------ Port Authority of New York and New Jersey, Consolidated Revenue Bonds (f): AAA Aaa 6,200 116th Series, 4.50% due 10/01/2018 5,171 AAA Aaa 2,180 AMT, 97th Series, 6.50% due 7/15/2019 2,260 AAA Aaa 4,740 AMT, 117th Series, Second Installment, 4.75% due 11/15/2016 4,133 - ------------------------------------------------------------------------------------------------------------------------------------ AAA Aaa 5,000 Port Authority of New York and New Jersey, Consolidated Revenue Refunding Bonds, AMT, 119th Series, 5.50% due 9/15/2016 (f) 4,884 - ------------------------------------------------------------------------------------------------------------------------------------ NR* Aaa 4,000 Port Authority of New York and New Jersey, RITR, AMT, 108th Series, 6.285% due 1/15/2017 (d)(e) 4,056 - ------------------------------------------------------------------------------------------------------------------------------------ Port Authority of New York and New Jersey, Special Obligation Revenue Bonds (b): NR* Aaa 1,000 (JFK International Air Terminal LLC), RIB, AMT, Series 157, 6.14% due 12/01/2022 (d) 946 AAA Aaa 3,500 (JFK International Air Terminal Project), AMT, Series 6, 5.75% due 12/01/2025 3,386 NR* Aaa 16,865 RIB, AMT, Series 243, 7.14% due 12/01/2010 (d) 19,593 - ------------------------------------------------------------------------------------------------------------------------------------ AAAr Aaa 12,085 Suffolk County, New York, IDA, Solid Waste Disposal Facility Revenue Refunding Bonds, RITR, AMT, Class R, Series 1, 6.967% due 10/01/2010 (a)(d) 13,575 - ------------------------------------------------------------------------------------------------------------------------------------ NR* Aaa 2,850 Syracuse, New York, COP, Revenue Bonds, RIB, AMT, Series 207, 7.54% due 1/01/2017 (d)(f) 3,072 - ------------------------------------------------------------------------------------------------------------------------------------ A Baa1 4,000 Triborough Bridge and Tunnel Authority, New York, Revenue Refunding Bonds (Convention Center Project), Series E, 7.25% due 1/01/2010 4,412 - ------------------------------------------------------------------------------------------------------------------------------------ Triborough Bridge and Tunnel Authority, New York, Special Obligation Revenue Refunding Bonds, Series A (b): AAA Aaa 2,265 5.125% due 1/01/2011 2,215 AAA Aaa 8,555 4.75% due 1/01/2024 7,127 - ------------------------------------------------------------------------------------------------------------------------------------ Total Investments (Cost--$786,834)--101.2% 784,098 Liabilities in Excess of Other Assets--(1.2%) (9,030) -------- Net Assets--100.0% $775,068 ======== - ------------------------------------------------------------------------------------------------------------------------------------
(a) AMBAC Insured. (b) MBIA Insured. (c) 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, 2000. (d) 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, 2000. (e) FSA Insured. (f) FGIC Insured. (g) Prerefunded. (h) FHA Insured. (i) Connie Lee Insured. +Highest short-term rating by Moody's Investors Service, Inc. *Not Rated. See Notes to Financial Statements. 10 & 11 MuniYield New York Insured Fund, Inc., April 30, 2000 STATEMENT OF ASSETS, LIABILITIES AND CAPITAL As of April 30, 2000 - ------------------------------------------------------------------------------------------------------------------------------------ Assets: Investments, at value (identified cost--$786,833,758)................... $784,097,541 Cash.................................................................... 10,273 Receivables: Securities sold...................................................... $ 14,680,783 Interest............................................................. 12,003,163 26,683,946 ------------ Prepaid expenses and other assets....................................... 23,121 ------------ Total assets............................................................ 810,814,881 ------------ - ------------------------------------------------------------------------------------------------------------------------------------ Liabilities: Payables: Securities purchased................................................. 34,571,275 Dividends to shareholders............................................ 458,053 Reorganization costs................................................. 340,772 Investment adviser................................................... 300,656 35,670,756 ------------ Accrued expenses and other liabilities.................................. 76,445 ------------ Total liabilities....................................................... 35,747,201 ------------ - ------------------------------------------------------------------------------------------------------------------------------------ Net Assets: Net assets.............................................................. $775,067,680 ============ - ------------------------------------------------------------------------------------------------------------------------------------ Capital: Capital Stock (200,000,000 shares authorized): Preferred Stock, par value $.05 per share (10,360 shares of AMPS* issued and outstanding at $25,000 per share liquidation preference).. $259,000,000 Common Stock, par value $.10 per share (39,445,962 shares issued and outstanding)..................................................... $ 3,944,596 Paid-in capital in excess of par........................................ 558,159,631 Undistributed investment income--net ................................... 4,062,721 Accumulated realized capital losses on investments--net................. (44,525,163) Accumulated distributions in excess of realized capital gains on investments--net........................................................ (2,837,888) Unrealized depreciation on investments--net............................. (2,736,217) ------------ Total--Equivalent to $13.08 net asset value per share of Common Stock (market price--$11.3125)................................................ 516,067,680 ------------ Total capital........................................................... $775,067,680 ============ - ------------------------------------------------------------------------------------------------------------------------------------ * Auction Market Preferred Stock. See Notes to Financial Statements.
STATEMENT OF OPERATIONS For the Six Months Ended April 30, 2000 - ------------------------------------------------------------------------------------------------------------------------------------ Investment Income: Interest and amortization of premium and discount earned............. $ 11,776,322 - ------------------------------------------------------------------------------------------------------------------------------------ Expenses: Investment advisory fees................................................ $ 1,023,597 Reorganization expenses................................................. 419,909 Commission fees......................................................... 182,233 Transfer agent fees..................................................... 61,765 Accounting services..................................................... 33,105 Professional fees....................................................... 31,174 Custodian fees.......................................................... 16,239 Printing and shareholder reports........................................ 14,989 Listing fees............................................................ 10,656 Directors' fees and expenses............................................ 8,858 Pricing fees............................................................ 8,027 Other................................................................... 12,996 ------------ Total expenses.......................................................... 1,823,548 ------------ Investment income--net.................................................. 9,952,774 ------------ - ------------------------------------------------------------------------------------------------------------------------------------ Realized & Realized loss on investments--net....................................... (12,392,249) Unrealized Gain Change in unrealized depreciation on investments--net................... 18,862,094 (Loss) On ------------ Investments Net Increase in Net Assets Resulting from Operations.................... $ 16,422,619 - --Net: ============ - ------------------------------------------------------------------------------------------------------------------------------------ See Notes to Financial Statements.
STATEMENTS OF CHANGES IN NET ASSETS
For the Six For the Months Ended Year Ended Increase (Decrease) in Net Assets: April 30, 2000 Oct. 31, 1999 - ------------------------------------------------------------------------------------------------------------------------------------ Operations: Investment income--net...................................................... $ 9,952,774 $ 13,036,798 Realized loss on investments--net........................................... (12,392,249) (833,436) Change in unrealized appreciation/depreciation on investments--net.......... 18,862,094 (30,444,256) ------------ ------------ Net increase (decrease) in net assets resulting from operations............. 16,422,619 (18,240,894) ------------ ------------ - ------------------------------------------------------------------------------------------------------------------------------------ Dividends & Investment income--net: Distributions to Common Stock........................................................... (6,457,880) (11,176,190) Shareholders: Preferred Stock........................................................ (2,361,661) (1,953,727) Realized gain on investments--net: Common Stock........................................................... -- (5,553,634) Preferred Stock........................................................ -- (866,775) In excess of realized gain on investments--net: Common Stock........................................................... -- (2,454,828) Preferred Stock........................................................ -- (383,133) ------------ ------------ Net decrease in net assets resulting from dividends and distributions to shareholders............................................................. (8,819,541) (22,388,287) ------------ ------------ - ------------------------------------------------------------------------------------------------------------------------------------ Capital Stock Proceeds from issuance of Common Stock resulting from reorganization........ 344,448,084 -- Transactions: Proceeds from issuance of Preferred Stock resulting from reorganization..... 174,000,000 -- Value of shares issued to Common Stock shareholders in reinvestment of dividends and distributions................................................. 209,815 4,853,434 ------------ ------------ Net increase in net assets derived from capital stock transactions.......... 518,657,899 4,853,434 ------------ ------------ - ------------------------------------------------------------------------------------------------------------------------------------ Net Assets: Total increase (decrease) in net assets..................................... 526,260,977 (35,775,747) Beginning of period......................................................... 248,806,703 284,582,450 ------------ ------------ End of period*.............................................................. $775,067,680 $248,806,703 ============ ============ - ------------------------------------------------------------------------------------------------------------------------------------ * Undistributed investment income--net................................... $ 4,062,721 $ 2,929,488 ============ ============ - ------------------------------------------------------------------------------------------------------------------------------------ See Notes to Financial Statements.
12 & 13 MuniYield New York Insured Fund, Inc., April 30, 2000 FINANCIAL HIGHLIGHTS
For the Six The following per share data and ratios have been derived Months Ended For the Year Ended October 31, from information provided in the financial statements. April 30, ----------------------------------------- Increase (Decrease) in Net Asset Value: 2000 1999 1998 1997 1996 - ------------------------------------------------------------------------------------------------------------------------------------ Per Share Net asset value, beginning of period .......................... $ 13.02 $ 16.26 $ 15.89 $ 15.49 $ 15.64 Operating -------- -------- -------- -------- -------- Performance: Investment income--net ........................................ .38 1.03 1.12 1.15 1.15 Realized and unrealized gain (loss) on investments--net ....... .19 (2.47) .61 .48 (.03) -------- -------- -------- -------- -------- Total from investment operations .............................. .57 (1.44) 1.73 1.63 1.12 -------- -------- -------- -------- -------- Less dividends and distributions to Common Stock shareholders: Investment income--net ..................................... (.40) (.89) (.90) (.91) (.91) Realized gain on investments--net .......................... -- (.45) (.19) (.07) -- In excess of realized gain on investments--net ............. -- (.20) -- -- (.10) -------- -------- -------- -------- -------- Total dividends and distributions to Common Stock shareholders (.40) (1.54) (1.09) (.98) (1.01) -------- -------- -------- -------- -------- Effect of Preferred Stock activity:++++ Dividends and distributions to Preferred Stock shareholders: Investment income--net ..................................... (.11) (.16) (.19) (.23) (.23) Realized gain on investments--net .......................... -- (.07) (.08) (.02) -- In excess of realized gain on investments--net ............. -- (.03) -- -- (.03) -------- -------- -------- -------- -------- Total effect of Preferred Stock activity ...................... (.11) (.26) (.27) (.25) (.26) -------- -------- -------- -------- -------- Net asset value, end of period ................................ $ 13.08 $ 13.02 $ 16.26 $ 15.89 $ 15.49 ======== ======== ======== ======== ======== Market price per share, end of period ......................... $11.3125 $12.4375 $16.3125 $ 15.875 $ 14.875 ======== ======== ======== ======== ======== - ------------------------------------------------------------------------------------------------------------------------------------ Total Investment Based on market price per share ............................... (5.96%)++ (15.63%) 9.99% 13.79% 10.79% Return:** ======== ======== ======== ======== ======== Based on net asset value per share ............................ 3.87%++ (11.40%) 9.53% 9.37% 6.04% ======== ======== ======== ======== ======== - ------------------------------------------------------------------------------------------------------------------------------------ Ratios Based on Total expenses, excluding reorganization expenses*** .......... 1.03%* 1.02% .98% 1.02% 1.02% Average Net ======== ======== ======== ======== ======== Assets Total expenses*** ............................................. 1.14%* 1.02% .98% 1.02% 1.02% Of Common ======== ======== ======== ======== ======== Stock: Total investment income--net*** ............................... 7.52%* 6.96% 7.07% 7.45% 7.46% ======== ======== ======== ======== ======== Amount of dividends to Preferred Stock shareholders ........... 1.74%* 1.04% 1.21% 1.51% 1.49% ======== ======== ======== ======== ======== Investment income--net, to Common Stock shareholders .......... 5.78%* 5.92% 5.86% 5.94% 5.97% ======== ======== ======== ======== ======== - ------------------------------------------------------------------------------------------------------------------------------------ Ratios Based on Total expenses, excluding reorganization expenses ............. .68%* .71% .68% .70% .70% Total ======== ======== ======== ======== ======== Average Net Total expenses ................................................ .75%* .71% .68% .70% .70% Assets:***+ ======== ======== ======== ======== ======== Total investment income--net .................................. 4.99%* 4.79% 4.91% 5.09% 5.11% ======== ======== ======== ======== ======== - ------------------------------------------------------------------------------------------------------------------------------------ Ratios Dividends to Preferred Stock shareholders ..................... 3.42%* 2.30% 2.77% 3.33% 3.25% Based on ======== ======== ======== ======== ======== Average Net Assets Of Preferred Stock: - ------------------------------------------------------------------------------------------------------------------------------------ Supplemental Net assets, net of Preferred Stock, end of period Data: (in thousands) ................................................ $516,068 $163,807 $199,582 $192,107 $186,611 ======== ======== ======== ======== ======== Preferred Stock outstanding, end of period (in thousands) ..... $259,000 $ 85,000 $ 85,000 $ 85,000 $ 85,000 ======== ======== ======== ======== ======== Portfolio turnover ............................................ 108.81% 99.71% 89.76% 81.73% 80.59% ======== ======== ======== ======== ======== - ------------------------------------------------------------------------------------------------------------------------------------ Leverage: Asset coverage per $1,000 ..................................... $ 2,993 $ 2,927 $ 3,348 $ 3,260 $ 3,195 ======== ======== ======== ======== ======== - ------------------------------------------------------------------------------------------------------------------------------------ Dividends Per Share Series A--Investment income--net .............................. $ 425 $ 566 $ 695 $ 826 $ 819 On Preferred ======== ======== ======== ======== ======== Stock Series B--Investment income--net .............................. $ 452 $ 583 $ 689 $ 837 $ 807 Outstanding: ======== ======== ======== ======== ======== Series C--Investment income--net .............................. $ 155 -- -- -- -- ======== ======== ======== ======== ======== Series D--Investment income--net .............................. $ 132 -- -- -- -- ======== ======== ======== ======== ======== Series E--Investment income--net .............................. $ 82 -- -- -- -- ======== ======== ======== ======== ======== - ------------------------------------------------------------------------------------------------------------------------------------
* Annualized. ** Total investment returns based on market value, which can be significantly greater or lesser than the net asset value, may result in substantially different returns. Total investment returns exclude the effects of sales charges. *** Do not reflect the effect of dividends to Preferred Stock shareholders. + Includes Common and Preferred Stock average net assets. ++ Aggregate total investment return. ++++ The Fund's Preferred Stock was issued on September 16, 1992 for Series A and Series B and on March 6, 2000 for Series C, Series D and Series E. See Notes to Financial Statements. 14 & 15 MuniYield New York Insured Fund, Inc., April 30, 2000 NOTES TO FINANCIAL STATEMENTS 1. Significant Accounting Policies: MuniYield New York Insured 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 accordance 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 MYN. The following is a summary of significant accounting policies followed by the Fund. (a) Valuation of investments--Municipal bonds are traded primarily in the over-the-counter markets and are valued at the most recent bid price or yield equivalent as obtained by the Fund's pricing service from dealers that make markets in such securities. Financial futures contracts and options thereon, which are traded on exchanges, are valued at their closing prices as of the close of such exchanges. Options 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-the-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 to increase or decrease the level of risk to which the Fund is exposed more quickly and efficiently than transactions in other types of instruments. Losses may arise due to changes in the value of the contract or if the counterparty does not perform under the contract. o Financial futures contracts--The Fund may purchase or sell financial futures contracts and options on such futures contracts for the purpose of hedging the market risk on existing securities or the intended purchase of securities. Futures contracts are contracts for delayed delivery of securities at a specific future date and at a specific price or yield. Upon entering into a contract, the Fund deposits and maintains as collateral such initial margin as required by the exchange on which the transaction is effected. Pursuant to the contract, the Fund agrees to receive from or pay to the broker an amount of cash equal to the daily fluctuation in value of the contract. Such receipts or payments are known as variation margin and are recorded by the Fund as unrealized gains or losses. When the contract is closed, the Fund records a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the value at the time it was closed. o Options--The Fund is authorized to write covered call options and purchase put options. When the Fund writes an option, an amount equal to the premium received by the Fund is reflected as an asset and an equivalent liability. The amount of the liability is subsequently marked to market to reflect the current market value of the option written. When a security is purchased or sold through an exercise of an option, the related premium paid (or received) is added to (or deducted from) the basis of the security acquired or deducted from (or added to) the proceeds of the security sold. When an option expires (or the Fund enters into a closing transaction), the Fund realizes a gain or loss on the option to the extent of the premiums received or paid (or gain or loss to the extent the cost of the closing transaction exceeds the premium paid or received). Written and purchased options are non-income producing investments. (c) Income taxes--It is the Fund's policy to comply with the 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). Interest income is recognized on the accrual basis. Discounts and market premiums are amortized into interest income. Realized gains and losses on security transactions are determined on the identified cost basis. (e) Dividends and distributions--Dividends from net investment income are declared and paid monthly. Distributions of capital gains are recorded on the ex-dividend dates. Distributions in excess of realized capital gains are due primarily to differing tax treatments for futures transactions and post-October losses. 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. Accounting services are provided to the Fund by FAM at cost. 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, 2000 were $524,521,333 and $410,134,686, respectively. Net realized losses for the six months ended April 30, 2000 and net unrealized losses as of April 30, 2000 were as follows: - -------------------------------------------------------------------------------- Realized Unrealized Losses Losses - -------------------------------------------------------------------------------- Long-term investments $(10,692,150) $(2,736,217) Financial futures contracts (1,700,099) -- ------------ ----------- Total $(12,392,249) $(2,736,217) ============ =========== - -------------------------------------------------------------------------------- As of April 30, 2000, net unrealized depreciation for Federal income tax purposes aggregated $2,736,217, of which $10,390,748 related to appreciated securities and $13,126,965 related to depreciated securities. The aggregate cost of investments at April 30, 2000 for Federal income tax purposes was $786,833,758. 4. Capital Stock Transactions: The Fund is authorized to issue 200,000,000 shares of capital 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 capital stock without approval of the holders of Common Stock. Common Stock Shares issued and outstanding during the six months ended April 30, 2000 increased by 26,844,207 as a result of issuance of Common Stock from reorganization and by 16,328 as a result of dividend reinvestment. Shares issued and outstanding during the year ended October 31, 1999 increased by 311,133 as a result of dividend reinvestment. Preferred Stock Auction Market Preferred Stock ("AMPS") are shares of Preferred Stock of the Fund, with a par value of $.05 per share and a liquidation preference of $25,000 per share, that entitle their 16 & 17 MuniYield New York Insured Fund, Inc., April 30, 2000 NOTES TO FINANCIAL STATEMENTS (concluded) holders to receive cash dividends at an annual rate that may vary for the successive dividend periods. The yields in effect at April 30, 2000 were as follows: Series A, 3.85%; Series B, 4.15%; Series C, 4.20%; Series D, 4.30%; and Series E, 3.85%. Shares issued and outstanding during the six months ended April 30, 2000 increased by 6,960 as a result of issuance of Preferred Stock from reorganization. Shares issued and outstanding during the year ended October 31, 1999 remained constant. 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, 2000, Merrill Lynch, Pierce, Fenner & Smith Incorporated, an affiliate of FAM, earned $87,691 as commissions. 5. Capital Loss Carryforward: At October 31, 1999, the Fund had a net capital loss carryforward of approximately $2,080,000, all of which expires in 2007. This amount will be available to offset like amounts of any future taxable gains. 6. Reorganization Plan: On March 6, 2000, the Fund acquired all of the net assets of MuniYield New York Insured Fund II, Inc. pursuant to a plan of reorganization. The acquisition was accomplished by a tax-free exchange of 26,668,886 Common Stock shares and 6,960 AMPS shares of MuniYield New York Insured Fund II, Inc. for 26,844,207 Common Stock shares and 6,960 AMPS shares of the Fund. MuniYield New York Insured Fund II, Inc.'s net assets on that date of $518,448,084, including $7,644,825 of unrealized depreciation and $32,132,913 of accumulated net realized capital losses, were combined with those of the Fund. The aggregate net assets of the Fund immediately after the acquisition amounted to $765,145,772. 7. Subsequent Event: On May 5, 2000, the Fund's Board of Directors declared an ordinary income dividend to Common Stock shareholders in the amount of $.064266 per share, payable on May 30, 2000 to shareholders of record as of May 16, 2000. 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 Assets, Liabilities and Capital, 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, 2000 were as follows: - ----------------------------------------------------------------- Percent of S&P Rating/Moody's Rating Net Assets - ----------------------------------------------------------------- AAA/Aaa........................................ 80.6% AA/Aa.......................................... 9.8 A/A............................................ 4.0 BBB/Baa........................................ 1.9 Other*......................................... 4.9 - ----------------------------------------------------------------- *Temporary investments in short-term municipal securities. OFFICERS AND DIRECTORS Terry K. Glenn, President and Director James H. Bodurtha, Director Herbert I. London, Director Joseph L. May, Director Andre F. Perold, Director Roberta Cooper Ramo, Director Arthur Zeikel, Director Vincent R. Giordano, Senior Vice President Kenneth A. Jacob, Vice President Donald C. Burke, Vice President and Treasurer Alice A. Pellegrino, Secretary - -------------------------------------------------------------------------------- Robert R. Martin, Director of MuniYield New York Insured Fund, Inc. has recently retired. The Fund's Board of Directors wishes Mr. Martin well in his retirement. - -------------------------------------------------------------------------------- Custodian The Bank of New York 90 Washington 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 100 Church Street New York, NY 10286 NYSE Symbol MYN 18 & 19 MuniYield New York Insured Fund, Inc. seeks to provide shareholders with as high a level of current income exempt from Federal, New York State and New York City income taxes as is consistent with its investment policies and prudent investment management by investing primarily in a portfolio of long-term municipal obligations the interest on which, in the opinion of bond counsel to the issuer, is exempt from Federal, New York State and New York City income taxes. This report, including the financial information herein, is transmitted to shareholders of MuniYield New York Insured 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 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 New York Insured Fund, Inc. Box 9011 Princeton, NJ 08543-9011 #16159--4/00 [RECYCLE LOGO] Printed on post-consumer recycled paper -----END PRIVACY-ENHANCED MESSAGE-----