-----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, P2S0IGqMWmjuIDzo4ldWr0XJXqlXMugqyyMvKUnaBmdJdnDrwoL+AxQwJjxwGMnJ zB/HR7BPPxAEBQVt8K+fqw== 0001005477-01-003651.txt : 20010612 0001005477-01-003651.hdr.sgml : 20010612 ACCESSION NUMBER: 0001005477-01-003651 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20010430 FILED AS OF DATE: 20010611 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MUNIYIELD NEW YORK INSURED FUND INC CENTRAL INDEX KEY: 0000882150 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [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: 1657965 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 [LOGO] Merrill Lynch Investment Managers Semi-Annual Report April 30, 2001 MuniYield New York Insured Fund, Inc. www.mlim.ml.com 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, 2001 DEAR SHAREHOLDER For the six months ended April 30, 2001, the Common Stock of MuniYield New York Insured Fund, Inc. earned $0.377 per share income dividends, which included earned and unpaid dividends of $0.059. This represents a net annualized yield of 5.33%, based on a month-end per share net asset value of $14.27. Over the same period, the total investment return on the Fund's Common Stock was +6.77%, based on a change in per share net asset value from $13.76 to $14.27, and assuming reinvestment of $0.383 per share income dividends. The average yields for the Fund's Auction Market Preferred Stock for the six months ended April 30, 2001 were: Series A, 3.63%; Series B, 3.50%; Series C, 3.66%; Series D, 3.45%; and Series E, 3.60%. The Municipal Market Environment During the six months ended April 30, 2001, the direction of long-term fixed- income bond yields was affected by the continued decline in US economic activity, volatile US equity markets, and most importantly, the reaction of the Federal Reserve Board to these factors. A preliminary estimate for the first quarter of 2001 gross national product growth was recently released at 2%, much higher than expected by most economic analysts. While this estimate is subject to revision in the coming months, its initial level denotes that US economic activity remains far below its growth potential. Additionally, inflationary pressures have remained well contained, largely in the 2%-3% range. These factors combined to promote a very favorable financial environment for bonds, and when coupled with significant declines in US equity markets in late 2000, especially the NASDAQ, pushed US Treasury bond yields lower. By mid-December, the Federal Reserve Board announced that economic conditions warranted the cessation of the series of short-term interest rate increases. Given a supportive economic environment and, at least, a neutral Federal Reserve Board, investors were free again to focus on the ongoing US Treasury debt reduction programs and forecasts of sizable Federal budgetary surpluses going forward. Many analysts and investors concluded that there would be a significant future shortage of longer-maturing US Treasury securities. These factors combined to help push US Treasury bond yields significantly lower. In early January 2001, the Federal Reserve Board lowered short-term interest rates by 50 basis points (0.50%), citing declining consumer confidence and weakening industrial production and retail sales growth. Similar reasons were given for an additional 50 basis point reduction in short-term interest rates by the Federal Reserve Board at the end of January 2001. These interest rate cuts triggered a significant rebound in many US equity indexes, reducing the appeal of a large number of US fixed-income securities. Additionally, many investors, believing that the Federal Reserve Board's actions in January 2001 as well as those anticipated in the coming months would quickly restore US economic growth to earlier levels, sold US Treasury bonds to realize recent profits. At the end of January 2001, long-term US Treasury bonds yielded approximately 5.50%, a decline of more than 25 basis points since the end of October 2000. In response to weakening employment, a decline in business investments and profits, and fears of ongoing weak consumer spending, the Federal Reserve Board continued to lower short-term interest rates in March and April in an effort to foster higher US economic activity. Long-term taxable fixed-income interest rates responded by declining to recent historic lows. By late March 2001, long-term US Treasury bond yields declined an additional 25 basis points to 5.26%. However, in April, US equity markets, particularly the NASDAQ, rallied strongly on the expectation that the Federal Reserve Board would take steps to restore economic activity and corporate profitability. Throughout much of April many investors reallocated assets out of US Treasury securities into equities. Corporate bond issuance remained heavy, providing an additional investment alternative to US Treasury issues. Under these various pressures, US Treasury bond prices declined sharply and yields rose to 5.78% by the end of April. During the past six months, long-term US Treasury bond yields, although exhibiting considerable volatility, remained unchanged. By April 2001, the tax-exempt bond market also reacted to the Federal Reserve Board's actions and equity market volatility, but its reaction was muted in both intensity and degree. Throughout most of the past six months, long-term municipal bond yields traded in a range between 5.45%-5.60%. In mid-March, the tax-exempt bond market rallied to 5.40%, following the Federal Reserve Board' s most recent monetary easing. With tax-exempt bond yield ratios in excess of 95% relative to their US Treasury counterparts during most of the period, investor demand was particularly strong during periods of declining equity prices. Strong equity markets in April 2001, as well as the possibility that the Federal Reserve Board was close to the end of its interest rate reduction cycle, lowered much of the investor demand and long-term tax-exempt bond yields rose throughout April. As measured by the Bond Buyer Revenue Bond Index, long-term, uninsured tax-exempt bond yields rose to approximately 5.63% at the end of the period. Despite the price reversal in April, long-term municipal bond yields declined more than 10 basis points. The recent relative outperformance of the tax-exempt bond market was particularly impressive given the dramatic increase in long-term municipal bond issuance during April 2001. Historically low municipal bond yields continued to allow municipalities to refund outstanding, higher-couponed debt. Also, as yields rose in early April, tax-exempt issuers rushed to issue new financing, fearing higher yields in the coming months. During the past six months, more than $115 billion in long-term tax-exempt bonds was issued, an increase of over 25% compared to the same period a year ago. During the three-month period ended April 30, 2001, tax-exempt bond issuance was particularly heavy with more than $66 billion in long-term municipal bonds underwritten, an increase of over 40% compared to the same period ended April 30, 2000. More than $20 billion in municipal securities was issued in April 2001, a 20% increase compared to April 2000. Historically, April has been a period of weak demand for tax-exempt products as investors are often forced to liquidate bond positions to meet Federal and state tax payments. In April 2001, there was no appreciable selling by retail accounts. It has been noted that thus far in 2001, new net cash inflows into municipal bond mutual funds have exceeded $4 billion compared to net new cash outflows of nearly $9 billion for the same period a year ago. This suggests that the positive technical structure of the municipal market has remained intact. Also, the coming months of June and July tend to be periods of strong retail demand in response to the larger-coupon income payments and proceeds from bond maturities these months generate. Additionally, short-term tax-exempt interest rates are poised to move lower. Seasonal tax pressures have kept short-term municipal rates artificially high, although not as high as in recent years. We believe all of these factors should enhance the tax-exempt market's technical position in the coming months. Looking forward, the municipal market's direction appears uncertain. Should the US economy materially weaken into late summer, the Federal Reserve Board may be forced to ease monetary policy to a greater extent than investors currently expect. The prospect of two or three additional interest rate easings may push fixed-income bond yields, including municipal bond yields, lower. However, should the cumulative 200 basis point reduction in short-term interest rates by the Federal Reserve Board and the proposed Federal tax reform combine to quickly restore consumer confidence and economic activity, tax-exempt bond rates may not decline further. Given the strong technical position of the municipal market, we believe the tax-exempt market is poised to continue to outperform its taxable counterpart in the coming months. 2 & 3 MuniYield New York Insured Fund, Inc., April 30, 2001 Portfolio Strategy For the six-month period ended April 30, 2001, we had a duration that was higher than the Fund's competitive group average. This reflected our belief that municipal bond yields were attractive relative to a slowing US domestic economy. We also believed that the Federal Reserve Board would lower short-term interest rates to bolster US economic activity and that long-term interest rates would decline in concert. In late 2000 as yields declined, we sold our lower-coupon bonds with long maturities and replaced them with higher-couponed issues in the intermediate part of the yield curve. This allowed us to capture a significant amount of the yield available in the municipal yield curve, while muting the overall volatility of the Fund. Our strategy worked well as it enhanced the Fund's yield and, as yields rose in early 2001, the Fund was able to preserve much of the gains realized in late 2000. Looking forward, we expect to concentrate our investments in the 10-year - 20-year range maturity sector. This portion of the yield curve is expected to outperform longer maturities as financial markets start to anticipate a US economic recovery and long-term interest rates begin to rise. The Federal Reserve Board's 200 basis point decrease in short-term interest rates by April 30, 2001 generated a beneficial effect on the Fund's borrowing costs. Despite recent seasonal tax pressures on short-term interest rates, borrowing costs were in the 3.5%-3.75% range for much of the period. Short-term tax-exempt interest rates are expected to fall into the 3% range. We believe that this decline in borrowing costs may generate a significant yield enhancement to benefit the Fund's Common Stock shareholders from leveraging of the Preferred Stock. 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. (See page 1 of this report to shareholders for a complete explanation of the benefits and risks of leveraging.) 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 Vice President and Portfolio Manager May 25, 2001 PROXY RESULTS During the six-month period ended April 30, 2001, MuniYield New York Insured Fund, Inc.'s Common Stock shareholders voted on the following proposal. The proposal was approved at a shareholders' meeting on April 25, 2001. The 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 Directors: Terry K. Glenn 31,789,640 519,867 James H. Bodurtha 31,783,471 526,036 Herbert I. London 31,772,179 537,328 Roberta Cooper Ramo 31,789,166 520,341 - ------------------------------------------------------------------------------------------------------------------
During the six-month period ended April 30, 2001, MuniYield New York Insured Fund, Inc.'s Preferred Stock shareholders voted on the following proposal. The proposal was approved at a shareholders' meeting on April 25, 2001. The 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, Herbert I. London, Joseph L. May, Andre F. Perold and Roberta Cooper Ramo as follows: Series A 1,635 40 Series B 1,672 0 Series C 2,751 0 Series D 1,906 19 Series E 2,064 30 - ------------------------------------------------------------------------------------------------------------------
4 & 5 MuniYield New York Insured Fund, Inc., April 30, 2001 SCHEDULE OF INVESTMENTS (in Thousands)
S&P Moody's Face STATE Ratings Ratings Amount Issue Value ==================================================================================================================================== New York--100.5% AAA Aaa $11,895 Albany County, New York, Airport Authority, Airport Revenue Bonds, Trust Receipts, AMT, Class R, Series 8, 7.448% due 12/15/2023 (e)(h) $ 13,220 ---------------------------------------------------------------------------------------------------------------- AAA Aaa 8,200 Buffalo and Fort Erie, New York, Public Bridge Authority, Toll Bridge System Revenue Bonds, 5.75% due 1/01/2025 (f) 8,406 ---------------------------------------------------------------------------------------------------------------- AAA Aaa 4,300 Buffalo, New York, Sewer Authority, Revenue Refunding Bonds, Series F, 6% due 7/01/2013 (b) 4,805 ---------------------------------------------------------------------------------------------------------------- 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 (f) 1,780 ---------------------------------------------------------------------------------------------------------------- NR* Aaa 805 Holland, New York, Central School District, GO, Refunding, 5.50% due 6/15/2014 (e) 858 ---------------------------------------------------------------------------------------------------------------- Huntington, New York, GO, Refunding (a): NR* Aaa 715 5.50% due 4/15/2010 771 NR* Aaa 485 5.50% due 4/15/2011 523 NR* Aaa 460 5.50% due 4/15/2012 494 NR* Aaa 455 5.50% due 4/15/2013 487 NR* Aaa 450 5.50% due 4/15/2014 478 NR* Aaa 450 5.50% due 4/15/2015 476 ---------------------------------------------------------------------------------------------------------------- NR* Aaa 1,675 Ilion, New York, Central School District, GO, Series B, 5.50% due 6/15/2015 1,759 ---------------------------------------------------------------------------------------------------------------- Long Island Power Authority, New York, Electric System Revenue Refunding Bonds, Series A: AAA Aaa 19,225 5.50% due 12/01/2011 (a) 20,711 AAA Aaa 7,375 5.50% due 12/01/2012 (e) 7,918 AAA Aaa 7,500 5.50% due 12/01/2023 (f) 7,569 AAA Aaa 2,350 5.50% due 12/01/2029 (f) 2,375 ---------------------------------------------------------------------------------------------------------------- Metropolitan Transportation Authority, New York, Commuter Facilities Revenue Bonds, Series A: AAA Aaa 3,380 5.25% due 7/01/2011 (e) 3,556 AAA NR* 7,945 5.50% due 7/01/2014 (b) 8,335 AAA Aaa 2,000 5.75% due 7/01/2021 (f) 2,087 ---------------------------------------------------------------------------------------------------------------- AAA Aaa 17,540 Metropolitan Transportation Authority, New York, Commuter Facilities Revenue Refunding Bonds, Series B, 4.875% due 7/01/2018 (b) 16,943 ---------------------------------------------------------------------------------------------------------------- Metropolitan Transportation Authority, New York, Dedicated Tax Fund Revenue Bonds, Series A: AAA Aaa 3,000 5.25% due 4/01/2016 (e) 3,056 AAA Aaa 3,000 4.75% due 4/01/2028 (b) 2,734 ---------------------------------------------------------------------------------------------------------------- AAA Aaa 1,635 Metropolitan Transportation Authority, New York, Service Contract, Transit Facilities Revenue Refunding Bonds, Series O, 5.75% due 7/01/2008 (f) 1,789 ---------------------------------------------------------------------------------------------------------------- Metropolitan Transportation Authority, New York, Transit Facilities Revenue Bonds: AAA Aaa 2,400 Series A, 6.10% due 7/01/2006 (e)(g) 2,688 AAA Aaa 5,605 Series A, 5.75% due 7/01/2021 (f) 5,849 AAA Aaa 2,500 Series C-1, 5.50% due 7/01/2022 (b) 2,539 ---------------------------------------------------------------------------------------------------------------- Metropolitan Transportation Authority, New York, Transit Facilities Revenue Refunding Bonds: AAA Aaa 5,000 Series A, 4.75% due 7/01/2024 (f) 4,573 AAA Aaa 350 Series B, 4.75% due 7/01/2026 (b) 319 AAA Aaa 2,500 Series C, 5.125% due 7/01/2013 (e) 2,568 ---------------------------------------------------------------------------------------------------------------- Monroe County, New York, IDA, Revenue Bonds (Southview Towers Project), AMT: NR* Aa1 1,400 6.125% due 2/01/2020 1,474 NR* Aa1 1,125 6.25% due 2/01/2031 1,191 ---------------------------------------------------------------------------------------------------------------- A1+ NR* 1,250 Nassau County, New York, IDA, Civic Facility Revenue Refunding and Improvement Bonds (Cold Spring Harbor), VRDN, 4.40% due 1/01/2034 (i) 1,250 ---------------------------------------------------------------------------------------------------------------- AAA Aaa 12,130 Nassau Health Care Corporation, New York, Health System Revenue Bonds, 5.75% due 8/01/2029 (e) 12,625 ---------------------------------------------------------------------------------------------------------------- A1+ VMIG1@ 14,700 New York City, New York, City Health and Hospital Corporation, Health System Revenue Bonds, VRDN, Series A, 4.05% due 2/15/2026 (i) 14,700 ---------------------------------------------------------------------------------------------------------------- A1+ NR* 17,100 New York City, New York, City Housing Development Corporation, M/F Rental Housing Revenue Bonds (Carnegie Park), VRDN, Series A, 4% due 11/15/2019 (d)(i) 17,100 ---------------------------------------------------------------------------------------------------------------- NR* Aaa 5,750 New York City, New York, City IDA, Civic Facility Revenue Bonds (USTA National Tennis Center), RIB, Series 206, 8.33% due 11/15/2014 (e)(h) 6,745 ---------------------------------------------------------------------------------------------------------------- New York City, New York, City Municipal Water Finance Authority, Water and Sewer System Revenue Bonds: AAA Aaa 2,500 Series A, 5.75% due 6/15/2031 (b) 2,601 AAA Aaa 12,100 Series B, 5.75% due 6/15/2026 (f) 12,457 AAA Aaa 17,200 Series B, 5.75% due 6/15/2029 (f) 17,766 A1+ VMIG1@ 1,200 VRDN, Series C, 4.25% due 6/15/2022 (b)(i) 1,200 A1+ VMIG1@ 5,100 VRDN, Series C, 4.25% due 6/15/2023 (b)(i) 5,100 ---------------------------------------------------------------------------------------------------------------- New York City, New York, City Municipal Water Finance Authority, Water and Sewer System Revenue Refunding Bonds: AAA Aaa 15,000 Series B, 6.50% due 6/15/2010 (f)(g) 17,657 AA Aa2 10,000 Series D, 5.50% due 6/15/2016 10,379 AAA Aaa 9,200 Series D, 4.75% due 6/15/2025 (b) 8,355 A1+ VMIG1@ 3,400 VRDN, Series A, 4.35% due 6/15/2025 (b)(i) 3,400 A1+ VMIG1@ 1,600 VRDN, Series G, 4.50% due 6/15/2024 (b)(i) 1,600 ---------------------------------------------------------------------------------------------------------------- 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 4,617 AAA Aaa 2,020 5.625% due 1/01/2012 2,173 ----------------------------------------------------------------------------------------------------------------
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 DRIVERS Derivative Inverse Tax-Exempt Receipts GO General Obligation Bonds HFA Housing Finance Agency IDA Industrial Development Authority M/F Multi-Family 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, 2001 SCHEDULE OF INVESTMENTS (continued) (in Thousands)
S&P Moody's Face STATE Ratings Ratings Amount Issue Value ==================================================================================================================================== New York New York City, New York, City Transitional Finance Authority (continued) Revenue Bonds, Future Tax Secured: AAA Aaa $ 3,140 Series B, 5.50% due 2/01/2011 (f) $ 3,370 AAA Aaa 7,625 Series B, 5.50% due 2/01/2012 (f) 8,155 AAA Aaa 5,650 Series B, 5.50% due 2/01/2013 (f) 5,998 AAA Aaa 6,805 Series B, 6.25% due 11/15/2017 (b) 7,513 AAA Aaa 9,000 Series B, 4.50% due 11/15/2027 (b) 7,723 AAA Aaa 5,000 Series C, 5.50% due 5/01/2025 (b) 5,061 A1+ VMIG1@ 1,900 VRDN, Series C, 4.40% due 5/01/2028 (i) 1,900 ---------------------------------------------------------------------------------------------------------------- NR* Aa2 7,500 New York City, New York, City Transitional Finance Authority Revenue Bonds, RIB, Series 304, 8.08% due 11/15/2017 (h) 9,061 ---------------------------------------------------------------------------------------------------------------- New York City, New York, GO: AAA Aaa 3,000 Series A, 5.75% due 5/15/2024 3,143 AAA Aaa 8,620 Series B, 5.50% due 8/01/2010 (f) 9,293 AAA Aaa 2,500 Series B, 5.75% due 8/01/2013 (f) 2,707 AAA Aaa 4,670 Series D, 5.25% due 8/01/2015 (f) 4,770 AAA Aaa 5,000 Series H, 5.75% due 3/15/2012 (b) 5,471 AAA Aaa 3,465 Series H, 5.75% due 3/15/2012 (e) 3,792 AAA Aaa 10,000 Series H, 5.75% due 3/15/2013 (b) 10,868 AAA Aaa 3,000 Series H, 5.75% due 3/15/2013 (e) 3,260 A1+ VMIG1@ 1,190 VRDN, Sub-Series B-2, 3.45% due 8/15/2019 (i) 1,190 ---------------------------------------------------------------------------------------------------------------- New York City, New York, GO, Refunding: AAA Aaa 1,000 Series A, 6.375% due 5/15/2013 (b) 1,137 AAA Aaa 380 Series B, 7% due 2/01/2002 (a)(g) 397 AAA NR* 2,000 Series B, 7% due 8/01/2002 (a)(g) 2,118 AAA NR* 1,620 Series B, 7% due 2/01/2018 (a) 1,683 AAA Aaa 2,000 Series D, 5.25% due 8/01/2015 (e) 2,043 AAA NR* 5,450 Series F, 5.25% due 8/01/2013 5,663 AAA Aaa 15,290 Series F, 5.25% due 8/01/2014 (a)(e) 15,758 AAA Aaa 2,500 Series G, 5.35% due 8/01/2013 (e) 2,599 AAA NR* 1,300 Series H, 5.50% due 8/01/2013 (e) 1,368 A1+ VMIG1@ 3,600 VRDN, Series H, Sub-Series H-3, 3.95% due 8/01/2019 (e)(i) 3,600 ---------------------------------------------------------------------------------------------------------------- AAA Aaa 14,970 New York City, New York, IDA, Special Facilities Revenue Bonds (Terminal One Group), AMT, 6.125% due 1/01/2024 (f) 15,561 ---------------------------------------------------------------------------------------------------------------- AAA Aaa 2,950 New York State Dormitory Authority, Hospital Revenue Refunding Bonds (New York Presbyterian Hospital), 5.50% due 8/01/2011 (a)(c) 3,152 ---------------------------------------------------------------------------------------------------------------- AAA Aaa 2,000 New York State Dormitory Authority, Lease Revenue Bonds (Municipal Health Facilities Improvement Program), Series A, 4.75% due 5/15/2024 (a) 1,822 ---------------------------------------------------------------------------------------------------------------- New York State Dormitory Authority Revenue Bonds: A1+ VMIG1@ 1,000 (Cornell University), VRDN, Series B, 4.40% due 7/01/2025 (i) 1,000 AAA Aaa 4,250 (Eger Health Care and Rehabilitation Center), 6.10% due 8/01/2037 (c) 4,519 AAA Aaa 1,600 (Memorial Sloan Kettering Cancer Center), 5.50% due 7/01/2017 (f) 1,679 AA- A3 2,340 (Mental Health Services Facilities Improvement), Series B, 6% due 8/15/2016 2,549 AAA Aaa 4,350 (Mental Health Services Facilities Improvement), Series F, 4.50% due 8/15/2028 (a) 3,713 AAA Aaa 2,000 (New School Social Research), 5.75% due 7/01/2026 (f) 2,075 AAA Aaa 1,000 Series B, 6.50% due 2/15/2011 (f)(j) 1,159 AAA Aaa 2,560 (State University Adult Facilities), Series B, 5.75% due 5/15/2016 (e) 2,728 AAA Aaa 1,000 (State University Adult Facilities), Series B, 5.75% due 5/15/2017 (e) 1,060 AAA Aaa 2,000 (State University Educational Facilities), Series B, 5.75% due 5/15/2004 (b)(g) 2,123 AAA Aaa 710 (Upstate Community Colleges), Series A, 6% due 7/01/2015 (e) 777 AAA Aaa 1,070 (Upstate Community Colleges), Series A, 6% due 7/01/2016 (e) 1,166 ---------------------------------------------------------------------------------------------------------------- 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) 14,907 AAA NR* 1,865 (City University System), Series 1, 5.25% due 7/01/2014 (b) 1,913 AAA Aaa 4,400 (City University System), Series C, 7.50% due 7/01/2010 (b) 5,185 AAA NR* 1,000 (City University System--Consolidated), Series 1, 5.625% due 7/01/2019 (e) 1,029 AAA NR* 3,250 (City University System--Consolidated), Series A, 5.625% due 7/01/2016 (e) 3,464 AAA NR* 4,250 (Hospital Mortgage--United Health Services Hospitals), 5.375% due 8/01/2027 (a)(c) 4,190 AA NR* 1,000 (Manhattan College), 5.50% due 7/01/2012 1,057 AA NR* 2,605 (Manhattan College), 5.50% due 7/01/2013 2,740 AA NR* 2,915 (Manhattan College), 5.50% due 7/01/2015 3,017 AAA Aaa 4,405 (Mental Health Services), Series A, 5.75% due 2/15/2027 4,553 BBB+ Baa1 15,000 (Mount Sinai Health), Series A, 6.625% due 7/01/2018 15,975 AAA Aaa 2,440 (New York and Presbyterian Hospitals), 4.75% due 8/01/2027 (a)(c) 2,182 AAA Aaa 12,145 RITR, Class R, Series 2, 7.772% due 7/01/2011 (a)(h) 15,243 AAA Aaa 2,500 (Saint John's University), 4.75% due 7/01/2028 (f) 2,251 AAA Aaa 6,000 (Siena College), 5.75% due 7/01/2026 (f) 6,225 ---------------------------------------------------------------------------------------------------------------- New York State Energy Research and Development Authority, Facilities Revenue Refunding Bonds (a)(h): AAA Aaa 2,075 DRIVERS, Series 176, 7.94% due 8/15/2020 2,301 AAA NR* 4,300 Trust Receipts, Class R, Series 12, 7.722% due 8/15/2020 4,768 ---------------------------------------------------------------------------------------------------------------- AAA Aaa 5,000 New York State Energy Research and Development Authority, Gas Facilities Revenue Bonds (Brooklyn Union Gas Company), AMT, Series B, 6.75% due 2/01/2024 (f) 5,213 ---------------------------------------------------------------------------------------------------------------- New York State Energy Research and Development Authority, PCR (Niagara Mohawk Power Corporation Project) (i): A1+ NR* 500 DATES, Series A, 4.50% due 7/01/2015 500 A1+ NR* 6,000 VRDN, AMT, Series B, 4.55% due 7/01/2027 6,000 ---------------------------------------------------------------------------------------------------------------- AAA Aaa 3,500 New York State Energy Research and Development Authority, PCR, Refunding (Central Hudson Gas and Electric), Series A, 5.45% due 8/01/2027 (a) 3,523 ---------------------------------------------------------------------------------------------------------------- AA+ Aa1 5,050 New York State Environmental Facilities Corporation, PCR, Refunding, RITR, Class R, Series 9, 7.198% due 6/15/2014 (h) 5,571 ---------------------------------------------------------------------------------------------------------------- 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) 3,985 ---------------------------------------------------------------------------------------------------------------- AAA Aaa 2,745 New York State, HFA, Revenue Refunding Bonds (Housing Mortgage Project), Series A, 6.10% due 11/01/2015 (e) 2,884 ----------------------------------------------------------------------------------------------------------------
8 & 9 MuniYield New York Insured Fund, Inc., April 30, 2001 SCHEDULE OF INVESTMENTS (continued) (in Thousands)
S&P Moody's Face STATE Ratings Ratings Amount Issue Value ==================================================================================================================================== New York AAA Aaa $ 2,500 New York State Local Government Assistance Corporation, Revenue (continued) Refunding Bonds, Series E, 6% due 4/01/2014 (f) $ 2,779 ---------------------------------------------------------------------------------------------------------------- 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) 2,797 AAA Aaa 5,375 (Health Center Project--Second Mortgage), Series A, 6.375% due 11/15/2019 (a) 5,744 AAA Aaa 1,475 (Mental Health Services), Series A, 6% due 2/15/2005 (f)(g) 1,617 AAA Aaa 25 (Mental Health Services), Series A, 6% due 2/15/2025 (f) 26 AAA Aaa 3,000 (Mental Health Services), Series E, 6.50% due 8/15/2004 (e)(g) 3,320 ---------------------------------------------------------------------------------------------------------------- New York State Medical Care Facilities Finance Agency, Revenue Refunding Bonds (Hospital & Nursing Homes) (c): AAA NR* 2,000 Series B, 6.25% due 2/15/2025 2,170 AAA Aaa 15,200 Series C, 6.375% due 8/15/2029 (f) 16,492 ---------------------------------------------------------------------------------------------------------------- AAA NR* 20,000 New York State Mortgage Agency, Homeowner Mortgage Revenue Bonds, AMT, Series 90, 6.35% due 10/01/2030 (f) 21,260 ---------------------------------------------------------------------------------------------------------------- AAA Aaa 18,055 New York State Mortgage Agency, Homeowner Mortgage Revenue Refunding Bonds, AMT, Series 67, 5.80% due 10/01/2028 (f) 18,485 ---------------------------------------------------------------------------------------------------------------- New York State Mortgage Agency Revenue Bonds, AMT: AAA Aaa 1,750 24th Series, 6.125% due 10/01/2030 (f) 1,821 NR* Aaa 3,500 27th Series, 5.80% due 10/01/2020 3,585 NR* NR* 5,700 Series 27, 5.875% due 4/01/2030 (f) 5,853 ---------------------------------------------------------------------------------------------------------------- New York State Thruway Authority, Highway and Bridge Trust Fund Revenue Bonds (b): AAA Aaa 2,000 Series A, 6.25% due 4/01/2011 2,268 AAA Aaa 5,000 Series B-1, 5.75% due 4/01/2012 5,438 AAA Aaa 2,500 Series C, 5.25% due 4/01/2014 2,566 ---------------------------------------------------------------------------------------------------------------- New York State Thruway Authority, Highway and Bridge Trust Fund Revenue Refunding Bonds (b): AAA Aaa 5,000 Series A, 5.50% due 4/01/2011 5,372 AAA Aaa 5,000 Series B, 5.25% due 4/01/2011 5,239 AAA Aaa 2,800 Series B, 5.25% due 4/01/2014 2,874 ---------------------------------------------------------------------------------------------------------------- AAA Aaa 2,750 New York State Thruway Authority, Service Contract, Local Highway and Bridge Revenue Bonds, 5.50% due 4/01/2011 (a) 2,954 ---------------------------------------------------------------------------------------------------------------- New York State Thruway Authority, Service Contract Revenue Bonds (Local Highway and Bridges Project): AAA Aaa 10,000 5.625% due 4/01/2012 (f) 10,716 AAA Aaa 3,000 5.75% due 4/01/2013 (a) 3,242 AAA Aaa 5,000 5.75% due 4/01/2014 (a) 5,375 AAA Aaa 5,000 5.75% due 4/01/2015 (a) 5,343 AAA Aaa 2,000 Series A-2, 5.375% due 4/01/2016 (f) 2,042 ---------------------------------------------------------------------------------------------------------------- New York State Thruway Authority, Service Contract Revenue Refunding Bonds (Local Highway and Bridges Project) (f): AAA Aaa 3,500 6% due 4/01/2011 3,820 AAA Aaa 3,500 6% due 4/01/2012 3,831 ---------------------------------------------------------------------------------------------------------------- AAA Aaa 5,000 New York State Urban Development Corporation Revenue Bonds (Correctional Facilities Service Contract), Series B, 4.75% due 1/01/2028 (a) 4,514 ---------------------------------------------------------------------------------------------------------------- AAA Aaa 3,190 New York State Urban Development Corporation, Revenue Refunding Bonds (Correctional Capital Facilities), Series A, 6.50% due 1/01/2011 (e) 3,675 ---------------------------------------------------------------------------------------------------------------- AAA Aaa 1,000 Niagara Falls, New York, GO (Water Treatment Plant), AMT, 7.25% due 11/01/2010 (f) 1,200 ---------------------------------------------------------------------------------------------------------------- AAA Aaa 2,705 Niagara, New York, Frontier Authority, Airport Revenue Bonds (Buffalo Niagara International Airport), Series B, 5.50% due 4/01/2019 (f) 2,757 ---------------------------------------------------------------------------------------------------------------- AAA Aaa 1,260 North Country, New York, Development Authority, Solid Waste Management System Revenue Refunding Bonds, 6% due 5/15/2015 (e) 1,397 ---------------------------------------------------------------------------------------------------------------- North Hempstead, New York, GO, Refunding, Series B (b): AAA Aaa 1,745 6.40% due 4/01/2013 2,013 AAA Aaa 555 6.40% due 4/01/2017 636 ---------------------------------------------------------------------------------------------------------------- AAA Aaa 1,080 Oneida County, New York, GO, Refunding, 5.50% due 3/15/2009 (b) 1,161 ---------------------------------------------------------------------------------------------------------------- AAA Aaa 1,665 Oneida County, New York, IDA, Civic Facilities Revenue Bonds (Mohawk Valley), Series A, 5.20% due 2/01/2013 (e) 1,700 ---------------------------------------------------------------------------------------------------------------- Port Authority of New York and New Jersey, Consolidated Revenue Bonds (b): AAA Aaa 2,000 116th Series, 5.25% due 10/01/2014 2,046 AAA Aaa 2,180 AMT, 97th Series, 6.50% due 7/15/2019 2,351 ---------------------------------------------------------------------------------------------------------------- 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 (b) 5,100 ---------------------------------------------------------------------------------------------------------------- AAA Aaa 4,075 Port Authority of New York and New Jersey, Revenue Bonds, Trust Receipts, AMT, Class R, Series 10, 7.372% due 1/15/2017 (e)(h) 4,420 ---------------------------------------------------------------------------------------------------------------- AAA NR* 7,500 Port Authority of New York and New Jersey Revenue Refunding Bonds, DRIVERS, AMT, Series 177, 7.67% due 10/15/2032 (f)(h) 8,406 ---------------------------------------------------------------------------------------------------------------- Port Authority of New York and New Jersey, Special Obligation Revenue Bonds, AMT (f): NR* Aaa 1,000 (JFK International Air Terminal LLC), RIB, Series 157, 7.03% due 12/01/2022 (h) 1,079 AAA Aaa 3,500 (JFK International Air Terminal Project), Series 6, 5.75% due 12/01/2025 3,606 NR* Aaa 16,865 RIB, Series 243, 8.03% due 12/01/2010 (h) 21,338 ---------------------------------------------------------------------------------------------------------------- AAA Aaa 1,255 Rensselaer County, New York, IDA, Civic Facility Revenue Bonds (Polytech Institute), Series B, 5.50% due 8/01/2022 (a) 1,274 ---------------------------------------------------------------------------------------------------------------- NR* Aaa 1,065 Rome, New York, City School District, GO, 5.50% due 6/15/2014 (e) 1,118 ---------------------------------------------------------------------------------------------------------------- AAAr Aaa 12,085 Suffolk County, New York, IDA, Solid Waste Disposal Facility Revenue Refunding Bonds, RITR, AMT, Class R, Series 1, 7.69% due 10/01/2010 (a)(h) 15,018 ---------------------------------------------------------------------------------------------------------------- NR* Aaa 2,850 Syracuse, New York, COP, Revenue Bonds, RIB, AMT, Series 207, 8.53% due 1/01/2017 (b)(h) 3,045 ---------------------------------------------------------------------------------------------------------------- Triborough Bridge and Tunnel Authority, New York, General Purpose Revenue Refunding Bonds: A+ Aa3 3,850 Series X, 6.625% due 1/01/2012 4,484 AAA Aaa 4,305 Series Y, 6% due 1/01/2012 (f) 4,805 ----------------------------------------------------------------------------------------------------------------
10 & 11 MuniYield New York Insured Fund, Inc., April 30, 2001 SCHEDULE OF INVESTMENTS (concluded) (in Thousands)
S&P Moody's Face STATE Ratings Ratings Amount Issue Value =================================================================================================================================== New York AA- A3 $ 4,000 Triborough Bridge and Tunnel Authority, New York, Revenue Refunding (concluded) Bonds (Convention Center Project), Series E, 7.25% due 1/01/2010 $ 4,551 --------------------------------------------------------------------------------------------------------------- Triborough Bridge and Tunnel Authority, New York, Special Obligation Revenue Refunding Bonds, Series A (f): AAA Aaa 2,265 5.125% due 1/01/2011 2,363 AAA Aaa 8,555 4.75% due 1/01/2024 7,780 --------------------------------------------------------------------------------------------------------------- AAA Aaa 2,010 Yonkers, New York, GO, Series A, 5.75% due 10/01/2017 (b) 2,129 =================================================================================================================================== Puerto Rico--0.2% AAA Aaa 1,250 Puerto Rico Commonwealth, Highway and Transportation Authority, Transportation Revenue Bonds, Trust Receipts, Class R, Series B, 7.372% due 7/01/2035 (f)(h) 1,425 =================================================================================================================================== Total Investments (Cost--$800,768)--100.7% 827,876 Liabilities in Excess of Other Assets--(0.7%) (5,838) -------- Net Assets--100.0% $822,038 ======== ===================================================================================================================================
(a) AMBAC Insured. (b) FGIC Insured. (c) FHA Insured. (d) FNMA Collateralized. (e) FSA Insured. (f) MBIA Insured. (g) Prerefunded. (h) 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, 2001. (i) 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, 2001. (j) Escrowed to maturity. @ Highest short-term rating by Moody's Investors Service, Inc. * Not Rated. See Notes to Financial Statements. STATEMENT OF ASSETS, LIABILITIES AND CAPITAL
As of April 30, 2001 ==================================================================================================================================== Assets: Investments, at value (identified cost--$800,768,164) ................................ $827,876,270 Cash ................................................................................. 106,305 Interest receivable .................................................................. 11,945,913 Prepaid expenses and other assets .................................................... 63,645 ------------ Total assets ......................................................................... 839,992,133 ------------ ==================================================================================================================================== Liabilities: Payables: Securities purchased ............................................................... $ 17,078,616 Dividends to shareholders .......................................................... 468,170 Investment adviser ................................................................. 329,255 17,876,041 ------------ Accrued expenses ..................................................................... 78,030 ------------ Total liabilities .................................................................... 17,954,071 ------------ ==================================================================================================================================== Net Assets: Net assets ........................................................................... $822,038,062 ============ ==================================================================================================================================== 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 ..................................................... 557,669,466 Undistributed investment income--net ................................................. 2,632,810 Accumulated realized capital losses on investments--net .............................. (25,479,028) Accumulated distributions in excess of realized capital gains on investments--net .... (2,837,888) Unrealized appreciation on investments--net .......................................... 27,108,106 ------------ Total--Equivalent to $14.27 net asset value per share of Common Stock (market price--$12.95) ............................................................... 563,038,062 ------------ Total capital ........................................................................ $822,038,062 ============ ====================================================================================================================================
*Auction Market Preferred Stock. See Notes to Financial Statements. 12 & 13 MuniYield New York Insured Fund, Inc., April 30, 2001 STATEMENT OF OPERATIONS
For the Six Months Ended April 30, 2001 =================================================================================================================================== Investment Interest and amortization of premium and discount earned ....................... $ 21,601,203 Income: =================================================================================================================================== Expenses: Investment advisory fees ....................................................... $ 2,051,215 Commission fees ................................................................ 297,358 Accounting services ............................................................ 108,534 Transfer agent fees ............................................................ 67,314 Professional fees .............................................................. 44,486 Custodian fees ................................................................. 26,310 Listing fees ................................................................... 24,071 Directors' fees and expenses ................................................... 21,526 Printing and shareholder reports ............................................... 20,849 Pricing fees ................................................................... 10,430 Other .......................................................................... 11,530 ------------- Total expenses ................................................................. 2,683,623 ------------- Investment income--net ......................................................... 18,917,580 ------------- =================================================================================================================================== Realized & Realized gain on investments--net .............................................. 14,929,909 Unrealized Change in unrealized appreciation on investments--net .......................... 6,190,677 Gain on ------------- Investments-- Net Increase in Net Assets Resulting from Operations ........................... $ 40,038,166 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, 2001 Oct. 31, 2000 =================================================================================================================================== Operations: Investment income--net ......................................................... $ 18,917,580 $ 29,123,286 Realized gain (loss) on investments--net ....................................... 14,929,909 (8,164,684) Change in unrealized appreciation/depreciation on investments--net ............. 6,190,677 42,515,741 ------------- ------------- Net increase in net assets resulting from operations ........................... 40,038,166 63,474,343 ------------- ------------- =================================================================================================================================== Dividends to Investment income--net: Shareholders: Common Stock ................................................................. (15,115,061) (21,433,382) Preferred Stock .............................................................. (4,594,090) (7,796,516) ------------- ------------- Net decrease in net assets resulting from dividends to shareholders ............ (19,709,151) (29,229,898) ------------- ------------- =================================================================================================================================== 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 -- 209,815 ------------- ------------- Net increase in net assets derived from capital stock transactions ............. -- 518,657,899 ------------- ------------- =================================================================================================================================== Net Assets: Total increase in net assets ................................................... 20,329,015 552,902,344 Beginning of period ............................................................ 801,709,047 248,806,703 ------------- ------------- End of period* ................................................................. $ 822,038,062 $ 801,709,047 ============= ============= =================================================================================================================================== *Undistributed investment income--net ........................................... $ 2,632,810 $ 3,424,381 ============= ============= ===================================================================================================================================
See Notes to Financial Statements. 14 & 15 MuniYield New York Insured Fund, Inc., April 30, 2001 FINANCIAL HIGHLIGHTS
The following per share data and ratios have been derived For the Six from information provided in the financial statements. Months Ended For the Year Ended October 31, April 30, ----------------------------------------- Increase (Decrease) in Net Asset Value: 2001 2000 1999 1998 1997 =================================================================================================================================== Per Share Net asset value, beginning of period .................. $ 13.76 $ 13.02 $ 16.26 $ 15.89 $ 15.49 Operating -------- -------- -------- -------- -------- Performance: Investment income--net ................................ .48 .87 1.03 1.12 1.15 Realized and unrealized gain (loss) on investments--net .53 .90 (2.47) .61 .48 -------- -------- -------- -------- -------- Total from investment operations ...................... 1.01 1.77 (1.44) 1.73 1.63 -------- -------- -------- -------- -------- Less dividends and distributions to Common Stock shareholders: Investment income--net ............................... (.38) (.78) (.89) (.90) (.91) Realized gain on investments--net .................... -- -- (.45) (.19) (.07) In excess of realized gain on investments--net ....... -- -- (.20) -- -- -------- -------- -------- -------- -------- Total dividends and distributions to Common Stock shareholders .......................................... (.38) (.78) (1.54) (1.09) (.98) -------- -------- -------- -------- -------- Effect of Preferred Stock activity: Dividends and distributions to Preferred Stock shareholders: Investment income--net ............................. (.12) (.25) (.16) (.19) (.23) Realized gain on investments--net .................. -- -- (.07) (.08) (.02) In excess of realized gain on investments--net ..... -- -- (.03) -- -- -------- -------- -------- -------- -------- Total effect of Preferred Stock activity .............. (.12) (.25) (.26) (.27) (.25) -------- -------- -------- -------- -------- Net asset value, end of period ........................ $ 14.27 $ 13.76 $ 13.02 $ 16.26 $ 15.89 ======== ======== ======== ======== ======== Market price per share, end of period ................. $ 12.95 $ 12.25 $12.4375 $16.3125 $ 15.875 ======== ======== ======== ======== ======== =================================================================================================================================== Total Based on market price per share ....................... 8.84%+++ 5.11% (15.63%) 9.99% 13.79% Investment ======== ======== ======== ======== ======== Return:** Based on net asset value per share .................... 6.77%+++ 12.79% (11.40%) 9.53% 9.37% ======== ======== ======== ======== ======== =================================================================================================================================== Ratios Based Total expenses, excluding reorganization expenses*** .. .95%* 1.01% 1.02% .98% 1.02% on Average Net ======== ======== ======== ======== ======== Assets Of Total expenses*** ..................................... .95%* 1.16% 1.02% .98% 1.02% Common Stock: ======== ======== ======== ======== ======== Total investment income--net*** ....................... 6.72%* 7.21% 6.96% 7.07% 7.45% ======== ======== ======== ======== ======== Amount of dividends to Preferred Stock shareholders ... 1.63%* 1.93% 1.04% 1.21% 1.51% ======== ======== ======== ======== ======== Investment income--net, to Common Stock shareholders .. 5.09%* 5.28% 5.92% 5.86% 5.94% ======== ======== ======== ======== ======== =================================================================================================================================== Ratios Based Total expenses, excluding reorganization expenses ..... .65%* .68% .71% .68% .70% on Total ======== ======== ======== ======== ======== Average Net Total expenses ........................................ .65%* .78% .71% .68% .70% Assets:***+ ======== ======== ======== ======== ======== Total investment income--net .......................... 4.62%* 4.82% 4.79% 4.91% 5.09% ======== ======== ======== ======== ======== =================================================================================================================================== Ratios Based Dividends to Preferred Stock shareholders ............. 3.58%* 3.91% 2.30% 2.77% 3.33% on Average ======== ======== ======== ======== ======== Net Assets Of Preferred Stock: =================================================================================================================================== Supplemental Net assets, net of Preferred Stock, end of period Data: (in thousands) ........................................ $563,038 $542,709 $163,807 $199,582 $192,107 ======== ======== ======== ======== ======== Preferred Stock outstanding, end of period (in thousands) ........................................ $259,000 $259,000 $ 85,000 $ 85,000 $ 85,000 ======== ======== ======== ======== ======== Portfolio turnover .................................... 43.80% 148.51% 99.71% 89.76% 81.73% ======== ======== ======== ======== ======== =================================================================================================================================== Leverage: Asset coverage per $1,000 ............................. $ 3,174 $ 3,095 $ 2,927 $ 3,348 $ 3,260 ======== ======== ======== ======== ======== =================================================================================================================================== Dividends Series A--Investment income--net ...................... $ 450 $ 980 $ 566 $ 695 $ 826 Per Share On ======== ======== ======== ======== ======== Preferred Stock Series B--Investment income--net ...................... $ 434 $ 941 $ 583 $ 689 $ 837 Outstanding:++ ======== ======== ======== ======== ======== Series C--Investment income--net ...................... $ 454 $ 661 -- -- -- ======== ======== ======== ======== ======== Series D--Investment income--net ...................... $ 428 $ 634 -- -- -- ======== ======== ======== ======== ======== Series E--Investment income--net ...................... $ 447 $ 653 -- -- -- ======== ======== ======== ======== ======== ===================================================================================================================================
* 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. ++ The Fund's Preferred Stock was issued on September 16, 1992 (Series A and Series B) and March 6, 2000 (Series C, Series D and Series E). +++ Aggregate total investment return. See Notes to Financial Statements. 16 & 17 MuniYield New York Insured Fund, Inc., April 30, 2001 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 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 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). Realized gains and losses on security transactions are determined on the identified cost basis. Interest income is recognized on the accrual basis. The Fund will adopt the provisions to amortize all premiums and discounts on debt securities effective November 1, 2001, as now required under the new AICPA Audit and Accounting Guide for Investment Companies. The cumulative effect of this accounting change will have no impact on the total net assets of the Fund. The impact of this accounting change has not been determined, but will result in an adjustment to the cost of securities and a corresponding adjustment to net unrealized appreciation/depreciation, based on debt securities held as of October 31, 2001. (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. 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. Prior to January 1, 2001, FAM provided accounting services to the Fund at its cost and the Fund reimbursed FAM for these services. FAM continues to provide certain accounting services to the Fund. The Fund reimburses FAM at its cost for such services. For the six months ended April 30, 2001, the Fund reimbursed FAM an aggregate of $34,034 for the above-described services. The Fund entered into an agreement with State Street Bank and Trust Company ("State Street"), effective January 1, 2001, pursuant to which State Street provides certain accounting services to the Fund. The Fund pays a fee for these 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, 2001 were $340,560,531 and $337,826,203, respectively. Net realized gains for the six months ended April 30, 2001 and net unrealized gains as of April 30, 2001 were as follows: - -------------------------------------------------------------------------------- Realized Unrealized Gains Gains - -------------------------------------------------------------------------------- Long-term investments .................... $14,883,277 $27,108,106 Financial futures contracts .............. 46,632 -- ----------- ----------- Total .................................... $14,929,909 $27,108,106 =========== =========== - -------------------------------------------------------------------------------- As of April 30, 2001, net unrealized appreciation for Federal income tax purposes aggregated $27,108,106, of which $31,675,354 related to appreciated securities and $4,567,248 related to depreciated securities. The aggregate cost of investments at April 30, 2001 for Federal income tax purposes was $800,768,164. 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 18 & 19 MuniYield New York Insured Fund, Inc., April 30, 2001 NOTES TO FINANCIAL STATEMENTS (concluded) 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, 2001 remained constant and during the year ended October 31, 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. 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 holders to receive cash dividends at an annual rate that may vary for the successive dividend periods. The yields in effect at April 30, 2001 were as follows: Series A, 3.50%; Series B, 3.30%; Series C, 3.55%; Series D, 3.40%; and Series E, 3.40%. Shares issued and outstanding during the six months ended April 30, 2001 remained constant and during the year ended October 31, 2000 increased by 6,960 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, 2001, Merrill Lynch, Pierce, Fenner & Smith Incorporated, an affiliate of FAM, earned $116,067 as commissions. 5. Capital Loss Carryforward: At October 31, 2000, the Fund had a net capital loss carryforward of approximately $41,762,000, of which $3,771,000 expires in 2006, $28,696,000 expires in 2007 and $9,295,000 expires in 2008. This amount will be available to offset like amounts of any future taxable gains. 6. Subsequent Event: On May 8, 2001, the Fund's Board of Directors declared an ordinary income dividend to Common Stock shareholders in the amount of $.059022 per share, payable on May 30, 2001 to shareholders of record as of May 16, 2001. 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, 2001 were as follows: - -------------------------------------------------------------------------------- Percent of S&P Rating/Moody's Rating Net Assets - -------------------------------------------------------------------------------- AAA/Aaa .................................................. 85.3% AA/Aa .................................................... 5.6 BBB/Baa .................................................. 2.0 Other* ................................................... 7.1 NR (Not Rated) ........................................... 0.7 - -------------------------------------------------------------------------------- * Temporary investments in short-term municipal securities. 20 & 21 MuniYield New York Insured Fund, Inc., April 30, 2001 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 Vincent R. Giordano, Senior Vice President Kenneth A. Jacob, Vice President Donald C. Burke, Vice President and Treasurer Alice A. Pellegrino, Secretary - -------------------------------------------------------------------------------- Arthur Zeikel, Director of MuniYield New York Insured Fund, Inc., has recently retired. The Fund's Board of Directors wishes Mr. Zeikel 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 22 [LOGO] Merrill Lynch Investment Managers [GRAPHIC OMITTED] MuniYield New York Insured Fund, Inc. seeks to provide shareholders with as high a level of current income exempt from Federal income tax and New York State and New York City personal 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 income tax and New York State and New York City personal 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 [RECYCLE LOGO] Printed on post-consumer recycled paper #16159--4/01 -----END PRIVACY-ENHANCED MESSAGE-----