-----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, Es/QBCS1LqJr1rAtItCT/V0mgMuwpJ4j6+uZVaSYWmZS9r3uBV2BlG71D9FuIfj9 n/GuDObpeVReIqqv/XcTJA== 0000928816-03-000844.txt : 20031223 0000928816-03-000844.hdr.sgml : 20031223 20031223164405 ACCESSION NUMBER: 0000928816-03-000844 CONFORMED SUBMISSION TYPE: N-CSR PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20031031 FILED AS OF DATE: 20031223 EFFECTIVENESS DATE: 20031223 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PUTNAM NEW YORK INVESTMENT GRADE MUNICIPAL TRUST CENTRAL INDEX KEY: 0000892960 IRS NUMBER: 046716832 STATE OF INCORPORATION: MA FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: N-CSR SEC ACT: 1940 Act SEC FILE NUMBER: 811-07274 FILM NUMBER: 031071541 BUSINESS ADDRESS: STREET 1: ONE POST OFFICE SQUARE CITY: BOSTON STATE: MA ZIP: 02109 BUSINESS PHONE: 6172921000 N-CSR 1 nyi1.txt PUTNAM NEW YORK INVESTMENT GRADE MUNICIPAL TRUST Putnam New York Investment Grade Municipal Trust Item 1. Report to Stockholders: - ------------------------------- The following is a copy of the report transmitted to stockholders pursuant to Rule 30e-1 under the Investment Company Act of 1940: SEMIANNUAL REPORT ON PERFORMANCE AND OUTLOOK 10-31-03 [GRAPHIC OMITTED: WATCH] [SCALE LOGO OMITTED] From the Trustees [GRAPHIC OMITTED: PHOTO OF JOHN A. HILL AND GEORGE PUTNAM, III] John A. Hill and George Putnam, III Dear Fellow Shareholder: You may have read recent press coverage regarding investigations involving Putnam Investments. Last month all Putnam shareholders were sent a letter detailing the steps being taken by Putnam to address the issues raised by federal and state regulators. Since then, a number of remedial actions, some of which were discussed in last month's letter, are being instituted under the terms of an order from the Securities and Exchange Commission (SEC). These include stringent employee trading restrictions, enhanced compliance standards and systems, new redemption fees for certain fund shares held less than three months, and a process for making full monetary restitution for any losses to fund shareholders. This process will be directed by an independent third party approved by the SEC and by Putnam's Board of Trustees. The Board is also continuing its own independent investigation of these issues and when complete a report will be issued detailing the additional steps being taken to make sure that nothing like this happens at Putnam again. We believe that the new senior management team at Putnam is fully committed to re-establishing the firm as a model for the highest ethical standards in the mutual fund industry. Our Board is committed to working with Putnam's management to ensure that everything possible is done to restore your full confidence in the Putnam organization. In terms of Putnam New York Investment Grade Municipal Trust's performance, we are pleased to report positive results for the six months ended October 31, 2003. In addition, your fund outperformed both its benchmark and its Lipper competitive category average at net asset value. The details are shown on the facing page. In their report, your fund's managers cite the portfolio's small allocation to higher-yielding lower-rated issues and defensive positioning as positive factors during the period. They also offer their views on prospects for the fiscal year's second half. Respectfully yours, /S/ JOHN A. HILL /S/ GEORGE PUTNAM, III John A. Hill George Putnam, III Chairman of the Trustees President of the Funds December 17, 2003 Report from Fund Management Fund highlights * For the six months ended October 31, 2003, Putnam New York Investment Grade Municipal Trust returned 2.70% at net asset value (NAV) and 0.26% at market price. * Based on results at NAV, the fund outperformed its benchmark, the Lehman Municipal Bond Index, which returned 1.47% for the period. We attribute this to defensive positioning and differences in portfolio composition. * At NAV, the fund also slightly outperformed the average for its Lipper category, Closed-End New York Municipal Debt Funds, which was 2.18%. * Index and Lipper results should be compared to fund performance at net asset value. See the performance summary on Page 7 for complete fund performance, comparative performance, and Lipper data. Performance commentary At the beginning of your fund's fiscal year, lower-rated, higher-yielding municipal bonds began to deliver strong performance for the first time in over a year. Although your fund is primarily an investment-grade fund, it does allocate some of the portfolio to these bonds -- and consequently, this positive change in investor sentiment translated into stronger performance for the fund. The top-performing holdings during the period were airline-related industrial development bonds (IDBs) -- positions that had dampened fund performance in the past, but whose prices rebounded in response to signs of renewed economic growth. Shifts we made in the fund's duration -- a measure of its sensitivity to changes in interest rates -- also aided results. We shortened duration, diminishing the fund's sensitivity to the negative effects of rising rates on bond prices. While this positioning reduced the fund's ability to profit from the price rally when interest rates fell early in the period, it offered protection when rates rose again dramatically, and ultimately, made a positive contribution to performance. Return at market price reflects investor demand as well as investment performance. We believe the fund's lower return at market price reflects reduced demand for fixed-income investments over the period. FUND PROFILE Putnam New York Investment Grade Municipal Trust seeks to provide high current income free from federal income tax and New York state and city personal income taxes, consistent with the preservation of capital. It may be suitable for New York investors seeking tax-free income through a diversified portfolio of high-quality bonds. Market overview Municipal bond yields -- which move in the opposite direction of their prices -- were unusually volatile between May 1 and October 31, 2003. Concern about deflation led to falling yields and higher bond prices through mid June. After rising through August, yields receded again in September, on unfavorable housing and unemployment data. October's positive economic surprises sent yields back up. Overall, yields ended the semiannual period higher than at the beginning of the period. The spread, or difference between yields of 10-year municipal bonds and 10-year Treasuries, widened, with municipals yielding close to their long-term average of 85% of comparable Treasury yields at the end of October, after yielding nearly 100% of Treasury yields earlier in the year. As the economy improved, investor demand for higher-yielding municipals increased. In particular, airline-related industrial development bonds outperformed other municipal bonds. California general obligation bonds were downgraded and underperformed as the state's budget crisis worsened. Tobacco settlement bonds outperformed following the Illinois Supreme Court's favorable ruling in one of the industry's ongoing litigation matters. - ------------------------------------------------------------------------------- MARKET SECTOR PERFORMANCE 6 MONTHS ENDED 10/31/03 - ------------------------------------------------------------------------------- Bonds - ------------------------------------------------------------------------------- Lehman Municipal Bond Index (tax-exempt bonds) 1.47% - ------------------------------------------------------------------------------- Lehman Aggregate Bond Index (broad bond market) 0.57% - ------------------------------------------------------------------------------- Lehman Government Bond Index (U.S. Treasury and agency securities) -0.19% - ------------------------------------------------------------------------------- JP Morgan Global High Yield Index (global high-yield corporate bonds) 9.61% - ------------------------------------------------------------------------------- Equities - ------------------------------------------------------------------------------- S&P 500 Index (broad stock market) 15.62% - ------------------------------------------------------------------------------- Russell 1000 Growth Index (large-company growth stocks) 16.81% - ------------------------------------------------------------------------------- Russell 1000 Value Index (large-company value stocks) 16.74% - ------------------------------------------------------------------------------- These indexes provide an overview of performance in different market sectors for the six months ended 10/31/03. - ------------------------------------------------------------------------------- Strategy overview We shortened duration (a measure of a fund's sensitivity to changes in interest rates) in May because interest rates were at historically low levels and were more likely, in our opinion, to rise than to fall. This defensive strategy helped protect portfolio assets when rates rose sharply between mid June and the end of July. We resumed a neutral duration in August and September, as we believed rates were unlikely to rise further. In September, rates fell again, so we shortened duration somewhat. This was beneficial when rates rose in October. At the end of the period, the portfolio's duration remained slightly defensive. We continued to diversify the fund's holdings. We took the opportunity afforded by strong demand for higher-yielding municipal bonds to take profits and reduce positions in some of the fund's lower-quality holdings, particularly airline-related industrial development bonds (IDBs). Although we had previously reduced the fund's holdings in tobacco settlement bonds -- bonds secured by the income stream from tobacco companies' settlement obligations to the states -- Putnam's bond analyst for this sector has offered support for a more positive view of the industry. Recently, numerous court cases have been decided in the industry's favor and we believe these decisions have reduced, somewhat, the perceived risk of unfavorable rulings that could affect the stability of the bonds' income stream. Accordingly, the fund has purchased more tobacco settlement bonds, and brought the weighting to neutral, relative to the benchmark. The fund may move toward an overweight position in tobacco settlement bonds if attractive investment opportunities arise. [GRAPHIC OMITTED: horizontal bar chart TOP SECTOR WEIGHTINGS COMPARED] TOP SECTOR WEIGHTINGS COMPARED as of as of 4/30/03 10/31/03 Transportation 22.8% 21.4% Utilities 14.2% 17.8% Health care 12.4% 16.5% Education 16.6% 11.1% Waste management 2.2% 1.5% Footnote reads: This chart shows how the fund's top weightings have changed over the last six months. Weightings are shown as a percentage of portfolio market value. Holdings will vary over time. How fund holdings affected performance Many of the fund's top performers during the period were airline-related IDBs. This type of municipal bond is usually issued to nance local expansion by various businesses, and is backed by the credit of the company benefiting from the financing. As a result, IDB prices are affected by investor perceptions of the health of the backing company or of the industry group. Especially since the terrorist attacks of September 11, 2001, airline-backed IDBs (generally issued to nance airport facility expansion) have been severely affected by declining air traffic, high fixed costs, and high-prole bankruptcies. As the prospects for economic recovery improved, the airline companies strengthened and concerns about bankruptcies diminished. This led to a sharp price recovery for these bonds and we used this opportunity to trim the fund's airline-related holdings. These included airport facility improvement bonds issued for American Airlines and British Airways. Since these bonds have been in the portfolio for some time, none of the sales resulted in a prot based on their acquisition cost, but the fund was able to sell on strength rather than in distress. Other bonds that performed well were two tobacco settlement bonds, one issued by New York Counties Tobacco Trust, offering a 5.75% coupon and maturing in 2043, and the other issued by Children's Trust Fund of Puerto Rico, with a 5.5% coupon, maturing in 2039. This sector recovered during the past six months, primarily due to a series of more positive legal judgments. Until recently, our view on the sector had been less favorable because of the multibillion-dollar litigation pending against the tobacco companies. This litigation, if successful, could have affected the ability of tobacco companies to meet their settlement payment obligations to the states. Ultimately, such a scenario would have had a negative effect on tobacco settlement bonds, which are secured by this promised income stream. During the reporting period, the litigation environment shifted in favor of tobacco companies, and in several cases, higher courts reversed severe lower court judgments and outlined higher hurdles and stricter rules for litigants against tobacco companies. This change prompted our reversion to a more positive stance on the sector. [GRAPHIC OMITTED: pie chart CREDIT QUALITY OVERVIEW] CREDIT QUALITY OVERVIEW A (18.4%) Aa/AA (22.6%) Aaa/AAA (37.4%) Other (0.6%) VMIG1 (5.0%) Ba/BB (2.3%) Baa/BBB (13.7%) Footnote reads: As a percentage of market value as of 10/31/03. A bond rated Baa/BBB or higher is considered investment grade. The chart reflects Moody's and Standard & Poor's ratings; percentages may include unrated bonds considered by Putnam Management to be of comparable quality. Ratings will vary over time. While the past several months have been positive ones for the bond market, including municipals, some bonds encountered difficulties and suffered from price declines. One fund holding that struggled was a bond issued by the New York City Industrial Development Agency to provide funds for Brooklyn Polytechnic University. These bonds were issued with a 6.125% coupon and mature in 2030. Brooklyn Polytechnic University is primarily a commuter school that offers technical education. The debt was issued to help the school build dormitories. Unfortunately, the tech downturn of the past few years led to decreasing enrollment at the school. The debt's credit rating was downgraded, and the bond price declined as a result. Since we did not anticipate any recovery over the near term, we reduced the position. Similarly, bonds issued by the Otsego County Industrial Development Agency on the behalf of Hartwick College stumbled. These were bonds carrying a coupon of 5.90% maturing in 2022. The college sought to remake itself as a more selective institution, but the weak economy led to declining applications and matriculation, which in turn triggered operating losses. We also cut back on this position. Please note that all holdings discussed in this report are subject to review in accordance with the fund's investment strategy and may vary in the future. The fund's management team The fund is managed by the Putnam Tax Exempt Fixed-Income Team. The members of the team are David Hamlin (Portfolio Leader), Paul Drury (Portfolio Member), Susan McCormack (Portfolio Member), James St. John (Portfolio Member), Richard Wyke (Portfolio Member), and Kevin Cronin. The outlook for your fund The following commentary reflects anticipated developments that could affect your fund over the next six months, as well as your management team's plans for responding to them. We anticipate continued volatility in the coming six months, and we believe the Federal Reserve Board will hold the federal funds rate steady at 1%. Our 12- to 18-month outlook is less certain. If economic policy succeeds, we may experience a classic bear market for bonds that may push yields higher. However, it is also possible that the economy may not respond satisfactorily to fiscal and monetary policy, and the yield on 10-year Treasuries could fall. Given this degree of uncertainty, we have, at this time, positioned the fund's duration somewhat defensively, and we believe rates may rise in the short term. Currently, we no longer see much opportunity to capitalize on yield spreads between municipal bonds and Treasuries, as the relationship between them is now near the long-term average. We expect that the credit quality of general obligation municipal bonds will remain under pressure, because tax revenues cannot be expected to grow significantly until taxpayers begin to report improved earnings. Although yield spreads between high- and low-quality municipal bonds have narrowed somewhat, we believe they could narrow further. As a result, we may see more opportunity for potential gain in this area. In keeping with the fund's objective, we will continue to monitor market conditions as we pursue a high level of tax-free income and manage the fund's risk exposure. The views expressed in this report are exclusively those of Putnam Management. They are not meant as investment advice. This fund concentrates its investment in one state and involves more risk than a fund that invests more broadly. Performance summary This section provides information about your fund's performance during the first half of its fiscal year, which ended October 31, 2003. In accordance with regulatory requirements, we also include performance for the most current calendar quarter-end. Performance should always be considered in light of a fund's investment strategy. Past performance does not indicate future results. More recent returns may be less or more than those shown. Investment return, net asset value, and market price will fluctuate and you may have a gain or a loss when you sell your shares. A profile of your fund's strategy appears on the first page of this report. See page 8 for definitions of some terms used in this section. - ------------------------------------------------------------------------ TOTAL RETURN FOR PERIODS ENDED 10/31/03 - ------------------------------------------------------------------------ Lipper Closed-End Lehman New York Municipal Municipal Market Bond Debt Funds NAV price Index category average* - ------------------------------------------------------------------------ 6 months 2.70% 0.26% 1.47% 2.18% - ------------------------------------------------------------------------ 1 year 6.63 1.37 5.12 6.12 - ------------------------------------------------------------------------ 5 years 26.02 7.49 31.08 30.04 Annual average 4.73 1.46 5.56 5.37 - ------------------------------------------------------------------------ 10 years 64.85 43.66 78.34 73.97 Annual average 5.13 3.69 5.96 5.67 - ------------------------------------------------------------------------ Annual average Life of fund (since 11/27/92) 5.96 4.01 6.55 6.31 - ------------------------------------------------------------------------ Performance does not reflect taxes on reinvested distributions. Index and Lipper results should be compared to fund performance at net asset value. * Over the 6-month and 1-, 5-, and 10-year periods ended 10/31/03, there were 22, 22, 10, and 10 funds, respectively, in this Lipper category. - ------------------------------------------------------------------------ TOTAL RETURN FOR PERIODS ENDED 9/30/03 (MOST RECENT CALENDAR QUARTER) - ------------------------------------------------------------------------ NAV Market price - ------------------------------------------------------------------------ 6 months 4.08% 1.01% - ------------------------------------------------------------------------ 1 year 3.36 -1.67 - ------------------------------------------------------------------------ 5 years 25.83 8.83 Annual average 4.70 1.71 - ------------------------------------------------------------------------ 10 years 66.06 44.28 Annual average 5.20 3.73 - ------------------------------------------------------------------------ Annual average Life of fund (since 11/27/92) 6.02 4.04 - ------------------------------------------------------------------------ - ------------------------------------------------------------------------ PRICE AND DISTRIBUTION INFORMATION 6 MONTHS ENDED 10/31/03 - ------------------------------------------------------------------------ Putnam New York Investment Grade Municipal Trust - ------------------------------------------------------------------------ Distributions from common shares - ------------------------------------------------------------------------ Number 6 - ------------------------------------------------------------------------ Income 1 $0.357 - ------------------------------------------------------------------------ Capital gains 1 -- - ------------------------------------------------------------------------ Total $0.357 - ------------------------------------------------------------------------ Series A Distributions from preferred shares (200 shares) - ------------------------------------------------------------------------ Income 1 $235.60 - ------------------------------------------------------------------------ Capital gains 1 -- - ------------------------------------------------------------------------ Total $235.60 - ------------------------------------------------------------------------ Share value (common shares) NAV Market price - ------------------------------------------------------------------------ 4/30/03 $13.37 $11.99 - ------------------------------------------------------------------------ 10/31/03 13.33 11.67 - ------------------------------------------------------------------------ Current return (common shares, end of period) - ------------------------------------------------------------------------ Current dividend rate 2 5.36% 6.12% - ------------------------------------------------------------------------ Taxable equivalent 3 9.21 10.52 - ------------------------------------------------------------------------ 1 Capital gains, if any, are taxable for federal and, in most cases, state purposes. For some investors, investment income may be subject to the federal alternative minimum tax. Income from federally exempt funds may be subject to state and local taxes. 2 Most recent distribution, excluding capital gains, annualized and divided by NAV or market price at end of period. 3 Assumes maximum 41.82% federal, state, and city tax rate for 2003. Results for investors subject to lower tax rates would not be as advantageous. Terms and definitions Total return shows how the value of the fund's shares changed over time, assuming you held the shares through the entire period and reinvested all distributions in the fund. Net asset value (NAV) is the value of all your fund's assets, minus any liabilities and the net assets allocated to remarketed preferred shares divided by the number of outstanding common shares. Market price is the current trading price of one share of the fund. Market prices are set by transactions between buyers and sellers on the American Stock Exchange. Comparative indexes JP Morgan Global High Yield Index is an unmanaged index that is designed to mirror the investable universe of the U.S. dollar global corporate debt market, including domestic and international issues. Lehman Aggregate Bond Index is an unmanaged index used as a general measure of U.S. fixed-income securities. Lehman Government Bond Index is an unmanaged index of U.S. Treasury and agency securities. Lehman Municipal Bond Index is an unmanaged index of long-term fixed-rate investment-grade tax-exempt bonds. Russell 1000 Growth Index is an unmanaged index of those companies in the Russell 1000 Index chosen for their growth orientation. Russell 1000 Value Index is an unmanaged index of those companies in the Russell 1000 Index chosen for their value orientation. S&P 500 Index is an unmanaged index of common stock performance. Indexes assume reinvestment of all distributions and do not account for fees. Securities and performance of a fund and an index will differ. You cannot invest directly in an index. Lipper Inc. is a third-party industry ranking entity that ranks funds (without sales charges) with similar current investment styles or objectives as determined by Lipper. Lipper category averages reflect performance trends for funds within a category and are based on results at net asset value. A note about duplicate mailings In response to investors' requests, the SEC has modified mailing regulations for proxy statements, semiannual and annual reports, and prospectuses. Putnam is now able to send a single copy of these materials to customers who share the same address. This change will automatically apply to all shareholders except those who notify us. If you would prefer to receive your own copy, please call Putnam at 1-800-225-1581. A guide to the financial statements These sections of the report, as well as the accompanying Notes, constitute the fund's financial statements. The fund's portfolio lists all the fund's investments and their values as of the last day of the reporting period. Holdings are organized by asset type and industry sector, country, or state to show areas of concentration and diversification. Statement of assets and liabilities shows how the fund's net assets and share price are determined. All investment and noninvestment assets are added together. Any unpaid expenses and other liabilities are subtracted from this total. The result is divided by the number of shares to determine the net asset value per share, which is calculated separately for each class of shares. (For funds with preferred shares, the amount subtracted from total assets includes the net assets allocated to remarketed preferred shares.) Statement of operations shows the fund's net investment gain or loss. This is done by first adding up all the fund's earnings -- from dividends and interest income -- and subtracting its operating expenses to determine net investment income (or loss). Then, any net gain or loss the fund realized on the sales of its holdings -- as well as any unrealized gains or losses over the period -- is added to or subtracted from the net investment result to determine the fund's net gain or loss for the fiscal period. Statement of changes in net assets shows how the fund's net assets were affected by distributions to shareholders and by changes in the number of the fund's shares. It lists distributions and their sources (net investment income or realized capital gains) over the current reporting period and the most recent fiscal year-end. The distributions listed here may not match the sources listed in the Statement of operations because the distributions are determined on a tax basis and may be paid in a different period from the one in which they were earned. Financial highlights provide an overview of the fund's investment results, per-share distributions, expense ratios, net investment income ratios, and portfolio turnover in one summary table, reflecting the five most recent reporting periods. In a semiannual report, the highlight table also includes the current reporting period. For open-end funds, a separate table is provided for each share class. The fund's portfolio October 31, 2003 (Unaudited) Key to Abbreviations - ------------------------------------------------------------------------------- AMBAC AMBAC Indemnity Corporation FGIC Financial Guaranty Insurance Company FHA Insd. Federal Housing Administration Insured FRB Floating Rate Bonds FSA Financial Security Assurance G.O. Bonds General Obligation Bonds IFB Inverse Floating Rate Bonds MBIA MBIA Insurance Company U.S. Govt. Coll. U.S. Government Collateralized VRDN Variable Rate Demand Notes Municipal bonds and notes (100.0%) (a) Principal amount Rating (RAT) Value New York (95.9%) - ------------------------------------------------------------------------------- $250,000 Albany, Indl. Dev. Agcy. Civic Fac. Rev. Bonds (Charitable Leadership), Ser. A , 6s, 7/1/19 Baa3 $265,938 1,000,000 Dutchess Cnty., Indl. Dev. Agcy. Civic Fac. Rev. Bonds (Bard College), 5 3/4s, 8/1/30 A3 1,070,000 250,000 Essex Cnty., Indl. Dev. Agcy. Rev. Bonds (Intl. Paper Co.), Ser. A, 5 1/2s, 10/1/26 Baa2 240,000 1,150,000 Geneva, Indl. Dev. Agcy. Rev. Bonds (Hobart & William Smith Project), Ser. A, 5 3/8s, 2/1/33 A 1,180,188 750,000 Long Island, Pwr. Auth. NY Elec. Syst. Rev. Bonds, Ser. A, 5 1/4s, 12/1/26 A- 760,313 1,000,000 Madison Cnty., Indl. Dev. Agcy. Rev. Bonds (Colgate U.), Ser. A, 5s, 7/1/23 Aa3 1,016,250 Metropolitan Trans. Auth. Svc. Contract Rev. Bonds 500,000 (Trans. Fac.), Ser. O, U.S. Govt. Coll., 5 3/4s, 7/1/13 AAA 576,875 1,000,000 Ser. A , MBIA, 5 1/2s, 1/1/20 Aaa 1,086,250 1,000,000 Metropolitan Trans. Auth. Rev. Bonds, Ser. A, FSA, 5s, 11/15/30 Aaa 1,007,500 650,000 Niagara Cnty., Indl. Dev. Agcy. Rev. Bonds, Ser. C, 5 5/8s, 11/15/24 Baa1 679,250 NY City, G.O. Bonds 185,000 Ser. I, U.S. Govt. Coll., 6 1/4s, 4/15/17 Aaa 213,675 45,000 Ser. D, 6s, 2/15/25 (Prerefunded) Aaa 48,206 20,000 Ser. D, 6s, 2/15/25 A2 21,425 1,000,000 Ser. B, 5 3/4s, 8/1/16 A2 1,090,000 1,000,000 Ser. B, 5 1/2s, 12/1/31 A2 1,033,750 1,650,000 NY City, IFB, AMBAC, 10.87s, 9/1/11(SEG) Aaa 1,709,268 300,000 NY City, Hlth. & Hosp. Corp. Rev. Bonds (Hlth. Syst.), Ser. A , 5 3/8s, 2/15/26 A3 302,625 750,000 NY City, Indl. Dev. Agcy. Rev. Bonds (Brooklyn Navy Yard Cogen. Partners), 5.65s, 10/1/28 BBB- 670,313 NY City, Indl. Dev. Agcy. Civic Fac. Rev. Bonds 600,000 (Staten Island U. Hosp.), Ser. A, 6 3/8s, 7/1/31 Baa3 623,250 300,000 (Brooklyn Polytech. U. Project J), 6 1/8s, 11/1/30 Ba1 238,875 700,000 NY City, Indl. Dev. Agcy. Special Arpt. Fac. Rev. Bonds (Airis JFK I LLC), Ser. A, 5 1/2s, 7/1/28 Baa3 679,000 NY City, Indl. Dev. Agcy. Special Fac. Rev. Bonds 1,000,000 (Terminal One Group Assn.), 6s, 1/1/15 A3 1,024,670 400,000 (American Airlines, Inc.), 5.4s, 7/1/20 Caa2 265,500 500,000 (British Airways), 5 1/4s, 12/1/32 BB+ 353,125 500,000 NY City, Muni. Wtr. & Swr. Fin. Auth. Rev. Bonds, Ser. G, FSA, 5s, 6/15/34 Aaa 502,500 2,350,000 NY City, Muni. Wtr. & Swr. Fin. Auth. VRDN, Ser. G, FGIC, 1.15s, 6/15/24 VMIG1 2,350,000 1,000,000 NY Cntys., Trust II Rev. Bonds (Tobacco Settlement), 5 3/4s, 6/1/43 Baa2 906,250 NY State Dorm. Auth. Rev. Bonds 1,000,000 (State U. Edl. Fac.), Ser. A, 7 1/2s, 5/15/13 AA- 1,277,500 250,000 (Mount Sinai Hlth.), Ser. A, 6 1/2s, 7/1/25 Ba1 250,625 1,930,000 (Mental Hlth. Svcs.), Ser. A, 5 3/4s, 2/15/27 (Prerefunded) AAA 2,202,609 70,000 (Mental Hlth. Svcs.), Ser. A, 5 3/4s, 2/15/27 AA- 74,725 700,000 (Winthrop-U. Hosp. Assn.), Ser. A, 5 1/2s, 7/1/32 Baa1 713,125 1,500,000 (Dept. of Hlth.), 5 1/2s, 7/1/25 AA- 1,545,000 600,000 (North Shore Long Island Jewish Group), 5 3/8s, 5/1/23 A3 606,750 1,190,000 (City U. Syst. Construction), Ser. 1, 5 1/4s, 7/1/17 AA- 1,261,400 1,000,000 (School Dist. Fin. Project), Ser. A, MBIA, 5 1/4s, 4/1/11 Aaa 1,118,750 1,500,000 (NY U.), Ser. 2, AMBAC, 5s, 7/1/41 Aaa 1,503,750 500,000 NY State Energy Res. & Dev. Auth. Fac. Rev. Bonds, 4.7s, 6/1/36 A1 502,500 1,000,000 NY State Energy Research & Dev. Auth. Poll. Control Rev. Bonds (Niagara Mohawk Pwr. Corp.), Ser. A, FGIC, 7.2s, 7/1/29 Aaa 1,055,450 250,000 NY State Env. Fac. Corp. Rev. Bonds, 5s, 6/15/32 Aaa 252,500 155,000 NY State Env. Fac. Corp. Poll. Control Rev. Bonds (State Wtr. Revolving Fund), Ser. A, 7 1/2s, 6/15/12 Aaa 155,915 1,315,000 NY State Med. Care Fac. Fin. Agcy. Rev. Bonds (Hosp. & Nursing Home Insd. Mtge.), Ser. C, FHA Insd., 6 3/8s, 8/15/29 AAA 1,369,809 750,000 NY State Pwr. Auth. Rev. Bonds, 5s, 11/15/20 Aa2 780,000 NY State Thruway Auth. Rev. Bonds, Ser. A, MBIA 1,000,000 5 1/4s, 4/1/13 Aaa 1,117,500 1,000,000 5 1/4s, 4/1/12 Aaa 1,116,250 1,000,000 NY State Urban Dev. Corp. Rev. Bonds (Personal Income Tax), Ser. C-1, 5s, 3/15/33 AA 1,000,000 500,000 Onondaga Cnty., Indl. Dev. Agcy. Rev. Bonds (Bristol-Meyers Squibb Co.), 5 3/4s, 3/1/24 AA- 540,000 200,000 Otsego Cnty., Indl. Dev. Agcy. Rev. Bonds (Hartwick College), 5.9s, 7/1/22 Baa3 198,500 1,000,000 Port Auth. NY & NJ Cons. Rev. Bonds, Ser. 124, 5s, 8/1/31 AA- 983,750 1,000,000 Port Auth. NY & NJ Special Obligation FRB, Ser. N18, MBIA, 8.64s, 12/1/17 (acquired 7/19/00, cost $1,046,890) (RES) Aaa 1,326,250 500,000 Suffolk Cnty., Indl. Dev. Agcy. Civic Fac. Rev. Bonds (Huntington Hosp.), Ser. B, 5 7/8s, 11/1/32 Baa1 508,750 1,000,000 Tobacco Settlement Fin. Auth. Rev. Bonds, Ser. A-1, 5 1/2s, 6/1/18 AA- 1,055,000 Triborough Bridge & Tunnel Auth. Rev. Bonds 1,000,000 Ser. A, 5s, 1/1/32 Aa3 1,002,500 1,000,000 AMBAC, 5s, 11/15/12 Aaa 1,108,750 250,000 Yonkers, Indl. Dev. Agcy. Civic Fac. Rev. Bonds (St. John's Riverside Hosp.), Ser. A, 7 1/8s, 7/1/31 BB 257,500 -------------- 44,800,154 Puerto Rico (4.1%) - ------------------------------------------------------------------------------- 750,000 Children's Trust Fund Tobacco Settlement Rev. Bonds, 5 1/2s, 5/15/39 Baa2 655,313 1,000,000 PR Elec. Pwr. Auth. Rev. Bonds, Ser. II, 5 1/4s, 7/1/31 A- 1,013,750 250,000 PR Indl. Tourist Edl. Med. & Env. Control Fac. Rev. Bonds (Cogen. Fac.-AES PR Project), 6 5/8s, 6/1/26 Baa2 261,563 -------------- 1,930,626 - ------------------------------------------------------------------------------- Total Investments (cost $45,384,713) $46,730,780 - ------------------------------------------------------------------------------- (a) Percentages indicated are based on portfolio market value. (RAT) The Moody's or Standard & Poor's ratings indicated are believed to be the most recent ratings available at October 31, 2003 for the securities listed. Ratings are generally ascribed to securities at the time of issuance. While the agencies may from time to time revise such ratings, they undertake no obligation to do so, and the ratings do not necessarily represent what the agencies would ascribe to these securities at October 31, 2003. Securities rated by Putnam are indicated by "/P" and are not publicly rated. (RES) Restricted, excluding 144A securities, as to public resale. The total market value of restricted securities held at October 31, 2003 was $1,326,250 or 2.8% of portfolio market value. (SEG) A portion of this security was pledged and segregated with the custodian to cover margin requirements for futures contracts at October 31, 2003. The rates shown on VRDN and Floating Rate Bonds (FRB) are the current interest rates shown at October 31, 2003. The rates shown on IFB, which are securities paying interest rates that vary inversely to changes in the market interest rates, are the current interest rates at October 31, 2003. The fund had the following industry group concentrations greater than 10% at October 31, 2003 (as a percentage of portfolio market value): Transportation 21.4% Utilities 17.8 Health care 16.5 Education 11.1 The fund had the following insurance concentration greater than 10% at October 31, 2003 (as a percentage of portfolio market value): MBIA 12.3% Futures contracts outstanding at October 31, 2003 (Unaudited) Market Aggregate Expiration Unrealized value face value date appreciation - ---------------------------------------------------------------------------- U.S. Treasury Note 10 yr (Long) $3,368,906 $3,354,033 Dec-03 $14,873 - ---------------------------------------------------------------------------- The accompanying notes are an integral part of these financial statements. Statement of assets and liabilities October 31, 2003 (Unaudited) Assets - ------------------------------------------------------------------------------- Investments in securities, at value (identified cost $45,384,713) (Note 1) $46,730,780 - ------------------------------------------------------------------------------- Cash 383,979 - ------------------------------------------------------------------------------- Interest and other receivables 767,081 - ------------------------------------------------------------------------------- Receivable for securities sold 396,750 - ------------------------------------------------------------------------------- Receivable for variation margin (Note 1) 10,313 - ------------------------------------------------------------------------------- Total assets 48,288,903 Liabilities - ------------------------------------------------------------------------------- Distributions payable to common shareholders 169,373 - ------------------------------------------------------------------------------- Accrued preferred shares distribution payable (Note 1) 3,493 - ------------------------------------------------------------------------------- Payable for compensation of Manager (Note 2) 79,252 - ------------------------------------------------------------------------------- Payable for investor servicing and custodian fees (Note 2) 6,343 - ------------------------------------------------------------------------------- Payable for Trustee compensation and expenses (Note 2) 20,699 - ------------------------------------------------------------------------------- Payable for administrative services (Note 2) 335 - ------------------------------------------------------------------------------- Other accrued expenses 53,037 - ------------------------------------------------------------------------------- Total liabilities 332,532 - ------------------------------------------------------------------------------- Series A remarketed preferred shares: (200 shares authorized) and outstanding at $50,000 per share (Note 4) 10,000,000 - ------------------------------------------------------------------------------- Net assets $37,956,371 Represented by - ------------------------------------------------------------------------------- Paid-in capital -- common shares (unlimited shares authorized) (Note 1) $39,492,317 - ------------------------------------------------------------------------------- Undistributed net investment income (Note 1) 229,431 - ------------------------------------------------------------------------------- Accumulated net realized loss on investments (Note 1) (3,126,317) - ------------------------------------------------------------------------------- Net unrealized appreciation of investments 1,360,940 - ------------------------------------------------------------------------------- Total -- Representing net assets applicable to common shares outstanding $37,956,371 Computation of net asset value - ------------------------------------------------------------------------------- Net asset value per common share ($37,956,371 divided by 2,847,092 shares) $13.33 - ------------------------------------------------------------------------------- The accompanying notes are an integral part of these financial statements. Statement of operations Six months ended October 31, 2003 (Unaudited) Interest income: $1,274,799 - ------------------------------------------------------------------------------- Expenses: - ------------------------------------------------------------------------------- Compensation of Manager (Note 2) 159,412 - ------------------------------------------------------------------------------- Investor servicing and custodian fees (Note 2) 22,132 - ------------------------------------------------------------------------------- Trustee compensation and expenses (Note 2) 4,752 - ------------------------------------------------------------------------------- Administrative services (Note 2) 2,013 - ------------------------------------------------------------------------------- Preferred share remarketing agent fees 12,415 - ------------------------------------------------------------------------------- Other 54,065 - ------------------------------------------------------------------------------- Total expenses 254,789 - ------------------------------------------------------------------------------- Expense reduction (Note 2) (3,415) - ------------------------------------------------------------------------------- Net expenses 251,374 - ------------------------------------------------------------------------------- Net investment income 1,023,425 - ------------------------------------------------------------------------------- Net realized loss on investments (Notes 1 and 3) (858,012) - ------------------------------------------------------------------------------- Net unrealized appreciation of investments and futures contracts during the period 791,234 - ------------------------------------------------------------------------------- Net loss on investments (66,778) - ------------------------------------------------------------------------------- Net increase in net assets resulting from operations $956,647 - ------------------------------------------------------------------------------- Distributions to Series A remarketed preferred shareholders: (Note 1) - ------------------------------------------------------------------------------- From tax exempt income (47,120) - ------------------------------------------------------------------------------- Net increase in net assets resulting from operations applicable to common shareholders $909,527 - ------------------------------------------------------------------------------- The accompanying notes are an integral part of these financial statements. Statement of changes in net assets Six months ended Year ended October 31 April 30 Increase (decrease) in net assets 2003* 2003 - ------------------------------------------------------------------------------- Operations: - ------------------------------------------------------------------------------- Net investment income $1,023,425 $2,349,267 - ------------------------------------------------------------------------------- Net realized loss on investments (858,012) (391,292) - ------------------------------------------------------------------------------- Net unrealized appreciation of investments 791,234 363,397 - ------------------------------------------------------------------------------- Net increase in net assets resulting from operations 956,647 2,321,372 - ------------------------------------------------------------------------------- Distributions to Series A remarketed preferred shareholders: (Note 1) - ------------------------------------------------------------------------------- From tax exempt income (47,120) (120,956) - ------------------------------------------------------------------------------- From ordinary income -- (1,150) - ------------------------------------------------------------------------------- Net increase in net assets resulting from operations applicable to common shareholders 909,527 2,199,266 - ------------------------------------------------------------------------------- Distributions to common shareholders: (Note 1) - ------------------------------------------------------------------------------- From tax exempt income (1,016,237) (2,032,488) - ------------------------------------------------------------------------------- From ordinary income -- (20,496) - ------------------------------------------------------------------------------- Total increase (decrease) in net assets (106,710) 146,282 Net assets - ------------------------------------------------------------------------------- Beginning of period 38,063,081 37,916,799 - ------------------------------------------------------------------------------- End of period (including undistributed net investment income of $229,431 and $269,363, respectively) $37,956,371 $38,063,081 - ------------------------------------------------------------------------------- Number of fund shares - ------------------------------------------------------------------------------- Common shares outstanding at beginning and end of period 2,847,092 2,847,092 - ------------------------------------------------------------------------------- Remarketed preferred shares outstanding at beginning and end of period 200 200 - ------------------------------------------------------------------------------- * Unaudited The accompanying notes are an integral part of these financial statements.
Financial highlights (For a common share outstanding throughout the period) Six months ended October 31 Per-share (Unaudited) Year ended April 30 operating performance 2003 2003 2002 2001 2000 1999 - --------------------------------------------------------------------------------------------------------------------------------- Net asset value, beginning of period (common shares) $13.37 $13.32 $13.45 $12.81 $14.03 $13.96 - --------------------------------------------------------------------------------------------------------------------------------- Investment operations: - --------------------------------------------------------------------------------------------------------------------------------- Net investment income (a) .36 .83 .88 .83 .90 .91 - --------------------------------------------------------------------------------------------------------------------------------- Net realized and unrealized gain (loss) on investments (.02) (.02) (.23) .72 (1.19) .08 - --------------------------------------------------------------------------------------------------------------------------------- Total from investment operations: .34 .81 .65 1.55 (.29) .99 - --------------------------------------------------------------------------------------------------------------------------------- Distributions to preferred shareholders: - --------------------------------------------------------------------------------------------------------------------------------- From net investment income (.02) (.04) (.07) (.13) (.12) (.11) - --------------------------------------------------------------------------------------------------------------------------------- Total from investment operations: applicable to common shareholders .32 .77 .58 1.42 (.41) .88 - --------------------------------------------------------------------------------------------------------------------------------- Distributions to common shareholders: - --------------------------------------------------------------------------------------------------------------------------------- From net investment income (.36) (.72) (.71) (.78) (.81) (.81) - --------------------------------------------------------------------------------------------------------------------------------- Total distributions (.36) (.72) (.71) (.78) (.81) (.81) - --------------------------------------------------------------------------------------------------------------------------------- Net asset value, end of period (common shares) $13.33 $13.37 $13.32 $13.45 $12.81 $14.03 - --------------------------------------------------------------------------------------------------------------------------------- Market price, end of period (common shares) $11.67 $11.99 $12.12 $12.46 $12.00 $13.88 - --------------------------------------------------------------------------------------------------------------------------------- Total return at market price (common shares) (%)(b) 0.26* 4.88 2.96 10.28 (7.75) 7.82 - --------------------------------------------------------------------------------------------------------------------------------- Ratios and supplemental data - --------------------------------------------------------------------------------------------------------------------------------- Net assets, end of period (common shares) (in thousands) $37,956 $38,063 $37,917 $38,288 $36,479 $39,952 - --------------------------------------------------------------------------------------------------------------------------------- Ratio of expenses to average net assets (%)(c)(d) .67* 1.36 1.35 1.41 1.44 1.32 - --------------------------------------------------------------------------------------------------------------------------------- Ratio of net investment income to average net assets (%)(c) 2.56* 5.84 5.96 5.25 5.96 5.66 - --------------------------------------------------------------------------------------------------------------------------------- Portfolio turnover rate (%) 6.39* 35.93 25.16 15.65 3.32 24.04 - --------------------------------------------------------------------------------------------------------------------------------- * Not annualized (a) Per share net investment income has been determined on the basis of the weighted average number of shares outstanding during the period. (b) Total return assumes dividend reinvestment. (c) Ratios reflect net assets available to common shares only; net investment income ratio also reflects reduction for distributions to preferred shareholders. (d) Includes amounts paid through expense offset arrangements (Note 2). The accompanying notes are an integral part of these financial statements.
Notes to financial statements October 31, 2003 Note 1 Significant accounting policies Putnam New York Investment Grade Municipal Trust (the "fund") is registered under the Investment Company Act of 1940, as amended, as a non-diversified, closed-end management investment company. The fund's investment objective is to seek high a current income exempt from federal income tax and New York State and City personal income tax. The fund intends to achieve its objective by investing in investment grade municipal securities constituting a portfolio that Putnam Investment Management, LLC ("Putnam Management"), the fund's Manager, an indirect wholly-owned subsidiary of Putnam, LLC, believes to be consistent with preservation of capital. The following is a summary of significant accounting policies consistently followed by the fund in the preparation of its financial statements. The preparation of financial statements is in conformity with accounting principles generally accepted in the United States of America and requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities in the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates. A) Security valuation Tax-exempt bonds and notes are valued on the basis of valuations provided by an independent pricing service, approved by the Trustees. Such services use information with respect to transactions in bonds, quotations from bond dealers, market transactions in comparable securities and various relationships between securities in determining value. Restricted securities are valued at fair value following procedures approved by the Trustees. Such valuations and procedures are reviewed periodically by the Trustees. B) Security transactions and related investment income Security transactions are recorded on the trade date (date the order to buy or sell is executed). Gains or losses on securities sold are determined on the identified cost basis. Interest income is recorded on the accrual basis. All premiums/discounts are amortized/accreted on a yield-to-maturity basis. The premium in excess of the call price, if any, is amortized to the call date; thereafter, any remaining premium is amortized to maturity. C) Futures and options contracts The fund may use futures and options contracts to hedge against changes in the values of securities the fund owns or expects to purchase. The fund may also write options on securities it owns or in which it may invest to increase its current returns. The potential risk to the fund is that the change in value of futures and options contracts may not correspond to the change in value of the hedged instruments. In addition, losses may arise from changes in the value of the underlying instruments, if there is an illiquid secondary market for the contracts, or if the counterparty to the contract is unable to perform. 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. Realized gains and losses on purchased options are included in realized gains and losses on investment securities. Futures contracts are valued at the quoted daily settlement prices established by the exchange on which they trade. The fund and the broker agree to exchange an amount of cash equal to the daily fluctuation in the value of the futures contract. Such receipts or payments are known as "variation margin." Exchange traded options are valued at the last sale price, or if no sales are reported, the last bid price for purchased options and the last ask price for written options. Options traded over-the-counter are valued using prices supplied by dealers. Futures and written option contracts outstanding at period end are listed after The fund's portfolio. D) Federal taxes It is the policy of the fund to distribute all of its income within the prescribed time and otherwise comply with the provisions of the Internal Revenue Code applicable to regulated investment companies. It is also the intention of the fund to distribute an amount sufficient to avoid imposition of any excise tax under Section 4982 of the Internal Revenue Code of 1986, as amended. Therefore, no provision has been made for federal taxes on income, capital gains or unrealized appreciation on securities held nor for excise tax on income and capital gains. At April 30, 2003, the fund had a capital loss carryover of $1,856,611 available to the extent allowed by tax law to offset future net capital gain, if any. The amount of the carryover and the expiration dates are: Loss Carryover Expiration - -------------------------------------- $619,079 April 30, 2004 491,807 April 30, 2005 433,833 April 30, 2008 311,892 April 30, 2011 Pursuant to federal income tax regulations applicable to regulated investment companies, the fund has elected to defer to its fiscal year ending April 30, 2004 $314,679 of losses recognized during the period November 1, 2002 to April 30, 2003. The aggregate identified cost on a tax basis is $45,457,703, resulting in gross unrealized appreciation and depreciation of $1,883,253 and $610,176, respectively, or net unrealized appreciation of $1,273,077. E) Distributions to shareholders Distributions to common and preferred shareholders from net investment income are recorded by the fund on the ex-dividend date. Distributions from capital gains, if any, are recorded on the ex-dividend date and paid at least annually. Dividends on remarketed preferred shares become payable when, as and if declared by the Trustees. Each dividend period for the remarketed preferred shares is generally a 28-day period. The applicable dividend rate for the remarketed preferred shares on October 31, 2003 was 0.85%. The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from generally accepted accounting principles. Reclassifications are made to the fund's capital accounts to reflect income and gains available for distribution (or available capital loss carryovers) under income tax regulations. F) Determination of net asset value Net asset value of the common shares is determined by dividing the value of all assets of the fund, less all liabilities and the liquidation preference of any outstanding remarketed preferred shares, by the total number of common shares outstanding as of period end. Note 2 Management fee, administrative services and other transactions Compensation of Putnam Management, for management and investment advisory services is paid quarterly based on the average net assets of the fund. Such fee is based on 0.65% of the fund's weekly average net assets. If dividends payable on remarketed preferred shares during any dividend payment period plus any expenses attributable to remarketed preferred shares for that period exceed the fund's gross income attributable to the proceeds of the remarketed preferred shares during that period, then the fee payable to Putnam Management for that period will be reduced by the amount of the excess (but not more than 0.65% of the liquidation preference of the remarketed preferred shares outstanding during the period). The fund reimburses Putnam Management an allocated amount for the compensation and related expenses of certain officers of the fund and their staff who provide administrative services to the fund. The aggregate amount of all such reimbursements is determined annually by the Trustees. Custodial functions for the fund's assets are provided by Putnam Fiduciary Trust Company (PFTC), a subsidiary of Putnam, LLC. Investor servicing agent functions are provided by Putnam Investor Services, a division of PFTC. The fund has entered into an arrangement with PFTC whereby credits realized as a result of uninvested cash balances are used to reduce a portion of the fund's expenses. For the six months ended October 31, 2003, the fund's expenses were reduced by $3,415 under these arrangements. Each independent Trustee of the fund receives an annual Trustee fee, of which $466 has been allocated to the fund, and an additional fee for each Trustees meeting attended. Trustees receive additional fees for attendance at certain committee meetings. The fund has adopted a Trustee Fee Deferral Plan (the "Deferral Plan") which allows the Trustees to defer the receipt of all or a portion of Trustees fees payable on or after July 1, 1995. The deferred fees remain invested in certain Putnam funds until distribution in accordance with the Deferral Plan. The fund has adopted an unfunded noncontributory defined benefit pension plan (the "Pension Plan") covering all Trustees of the fund who have served as a Trustee for at least five years. Benefits under the Pension Plan are equal to 50% of the Trustee's average total retainer and meeting fees for the three years preceding retirement. Pension expense for the fund is included in Trustee compensation and expenses in the Statement of operations. Accrued pension liability is included in Payable for Trustee compensation and expenses in the Statement of assets and liabilities. Note 3 Purchases and sales of securities During the six months ended October 31, 2003, cost of purchases and proceeds from sales of investment securities other than short-term investments aggregated $2,969,987 and $5,797,325, respectively. There were no purchases and sales of U.S. government obligations. Note 4 Preferred shares The Series A shares are redeemable at the option of the fund on any dividend payment date at a redemption price of $50,000 per share, plus an amount equal to any dividends accumulated on a daily basis but unpaid through the redemption date (whether or not such dividends have been declared) and, in certain circumstances, a call premium. It is anticipated that dividends paid to holders of remarketed preferred shares will be considered tax-exempt dividends under the Internal Revenue Code of 1986. To the extent that the fund earns taxable income and capital gains by the conclusion of a fiscal year, it may be required to apportion to the holders of the remarketed preferred shares throughout that year additional dividends as necessary to result in an after-tax equivalent to the applicable dividend rate for the period. Under the Investment Company Act of 1940, the fund is required to maintain asset coverage of at least 200% with respect to the remarketed preferred shares as of the last business day of each month in which any such shares are outstanding. Additionally, the fund is required to meet more stringent asset coverage requirements under terms of the remarketed preferred shares and the shares' rating agencies. Should these requirements not be met, or should dividends accrued on the remarketed preferred shares not be paid, the fund may be restricted in its ability to declare dividends to common shareholders or may be required to redeem certain of the remarketed preferred shares. At October 31, 2003, no such restrictions have been placed on the fund. Note 5 Regulatory matters and litigation On November 13, 2003, Putnam Management agreed to entry of an order by the Securities and Exchange Commission (SEC) in partial resolution of administrative and cease-and-desist proceedings initiated by the SEC on October 28, 2003 in connection with alleged excessive short-term trading by at least six Putnam Management investment professionals. The SEC's findings reflect that four of those employees engaged in such trading in funds over which they had investment decision-making responsibility and had access to non-public information regarding, among other things, current portfolio holdings, and valuations. The six individuals no longer have investment responsibilities with Putnam Management. Under the order, Putnam Management will make restitution for losses attributable to excessive short-term trading by Putnam employees, institute new employee trading restrictions and enhanced employee trading compliance, retain an independent compliance consultant, and take other remedial actions. Putnam Management neither admitted nor denied the order's findings, which included findings that Putnam Management willfully violated provisions of the federal securities laws. A civil monetary penalty and other monetary relief, if any, will be determined at a later date. If a hearing is necessary to determine the amounts of such penalty or other relief, Putnam Management will be precluded from arguing that it did not violate the federal securities laws in the manner described in the SEC order, the findings set forth in the SEC order will be accepted as true by the hearing officer and additional evidence may be presented. Putnam Management, and not the investors in any Putnam fund, will bear all costs, including restitution, civil penalties and associated legal fees. Administrative proceedings instituted by the Commonwealth of Massachusetts on October 28, 2003 against Putnam Management in connection with alleged market timing activities by Putnam employees and by participants in some Putnam-administered 401(k) plans are pending. Putnam Management has committed to make complete restitution for any losses suffered by Putnam shareholders as a result of any improper market-timing activities by Putnam employees or within Putnam-administered 401(k) plans. The SEC's and Commonwealth's allegations and related matters also serve as the general basis for numerous lawsuits, including purported class action lawsuits filed against Putnam Management and certain related parties, including certain Putnam funds. Putnam Management has agreed to bear any costs incurred by Putnam funds in connection with these lawsuits. Based on currently available information, Putnam Management believes that the likelihood that the pending private lawsuits and purported class action lawsuits will have a material adverse financial impact on the fund is remote, and the pending actions are not likely to materially affect its ability to provide investment management services to its clients, including the Putnam funds. Review of these matters by counsel for Putnam Management and by separate independent counsel for the Putnam funds and their independent Trustees is continuing. In addition, Marsh & McLennan Companies, Inc., Putnam Management's parent company, has engaged counsel to conduct a separate review of Putnam Management's policies and controls related to short-term trading. Results of October 7, 2003 shareholder meeting (Unaudited) An annual meeting of shareholders of the fund was held on October 7, 2003 At the meeting, each of the nominees for Trustees was elected, as follows: Common shares Votes Votes for withheld - ---------------------------------------------------------------- Jameson Adkins Baxter 2,580,008 37,726 Charles B. Curtis 2,580,698 37,036 Ronald J. Jackson 2,580,698 37,036 Paul L. Joskow 2,580,698 37,036 Elizabeth T. Kennan 2,580,008 37,726 Lawrence J. Lasser* 2,579,698 38,036 John H. Mullin III 2,580,698 37,036 George Putnam, III 2,576,987 40,747 A.J.C. Smith 2,579,698 38,036 W. Thomas Stephens 2,580,298 37,436 W. Nicholas Thorndike 2,580,698 37,036 Preferred Shares Votes Votes for withheld - ---------------------------------------------------------------- Jameson Adkins Baxter 199 -- Charles B. Curtis 199 -- John A. Hill 199 -- Ronald J. Jackson 199 -- Paul L. Joskow 199 -- Elizabeth T. Kennan 199 -- Lawrence J. Lasser* 199 -- John H. Mullin III 199 -- Robert E. Patterson 199 -- George Putnam, III 199 -- A.J.C. Smith 199 -- W. Thomas Stephens 199 -- W. Nicholas Thorndike 199 -- All tabulations are rounded to nearest whole number. * Mr. Lasser resigned from the Board of Trustees of the Putnam funds on November 3, 2003. Fund information About Putnam Investments One of the largest mutual fund families in the United States, Putnam Investments has a heritage of investment leadership dating back to Judge Samuel Putnam, whose Prudent Man Rule has defined fiduciary tradition and practice since 1830. Founded over 65 years ago, Putnam Investments was built around the concept that a balance between risk and reward is the hallmark of a well-rounded financial program. We presently manage over 100 mutual funds in growth, value, blend, fixed income, and international. Investment Manager Putnam Investment Management, LLC One Post Office Square Boston, MA 02109 Marketing Services Putnam Retail Management One Post Office Square Boston, MA 02109 Custodian Putnam Fiduciary Trust Company Legal Counsel Ropes & Gray LLP Trustees John A. Hill, Chairman Jameson Adkins Baxter Charles B. Curtis Ronald J. Jackson Paul L. Joskow Elizabeth T. Kennan John H. Mullin III Robert E. Patterson George Putnam, III A.J.C. Smith W. Thomas Stephens W. Nicholas Thorndike Officers George Putnam, III President Charles E. Porter Executive Vice President, Treasurer and Principal Financial Officer Patricia C. Flaherty Senior Vice President Karnig H. Durgarian Vice President and Principal Executive Officer Steven D. Krichmar Vice President and Principal Financial Officer Michael T. Healy Assistant Treasurer and Principal Accounting Officer Beth S. Mazor Vice President Gordon H. Silver Vice President Mark C. Trenchard Vice President and BSA Compliance Officer William H. Woolverton Vice President and Chief Legal Officer Judith Cohen Clerk and Assistant Treasurer Call 1-800-225-1581 weekdays from 9 a.m. to 5 p.m. Eastern Time, or visit our Web site (www.putnaminvestments.com) any time for up-to-date information about the fund's NAV. [LOGO OMITTED] PUTNAM INVESTMENTS The Putnam Funds One Post Office Square Boston, Massachusetts 02109 - ------------------ PRSRT STD U.S. POSTAGE PAID PUTNAM INVESTMENTS - ------------------ Do you want to save paper and receive this document faster? Shareholders can sign up for email delivery of shareholder reports on www.putnaminvestments.com. 203413 185 12/03 Item 2. Code of Ethics: - ----------------------- Not applicable Item 3. Audit Committee Financial Expert: - ----------------------------------------- Not applicable Item 4. Principal Accountant Fees and Services: - ----------------------------------------------- Not applicable Items 5-6. [Reserved] - --------------------- Item 7. Disclosure of Proxy Voting Policies and Procedures For Closed End - ------------------------------------------------------------------------- Management Investment Companies: Not applicable -------------------------------- Item 8. [Reserved] - ------------------ Item 9. Controls and Procedures: - -------------------------------- (a) The registrant's principal executive officer and principal financial officers have concluded, based on their evaluation of the effectiveness of the design and operation of the registrant's disclosure controls and procedures as of a date within 90 days of the filing date of this report on Form N-CSR, that the design and operation of such procedures are effective to provide reasonable assurance that information required to be disclosed by the investment company in the reports that it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized, and reported within the time periods specified in the Commission's rules and forms. (b) Changes in internal control over financial reporting: Not applicable Item 10. Exhibits: - ------------------ (a) Not applicable (b) A separate certification for each principal executive officer and principal financial officer of the registrant as required by Rule 30a-2 under the Investment Company Act of 1940, as amended, and the officer certifications as required by Section 906 of the Sarbanes-Oxley Act of 2002 are filed herewith. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934 an the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. NAME OF REGISTRANT By (Signature and Title): /s/Michael T. Healy -------------------------- Michael T. Healy Principal Accounting Officer Date: December 23, 2003 Pursuant to the requirements of the Securities Exchange Act of 1934 an the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. By (Signature and Title): /s/Karnig H. Durgarian --------------------------- Karnig H. Durgarian Principal Executive Officer Date: December 23, 2003 By (Signature and Title): /s/Charles E. Porter --------------------------- Charles E. Porter Principal Financial Officer Date: December 23, 2003 By (Signature and Title): /s/Steven D. Krichmar --------------------------- Steven D. Krichmar Principal Financial Officer Date: December 23, 2003 EX-99.CERT 3 exnn2.txt EX-99.CERT Certifications - -------------- I, Charles E. Porter, a principal financial officer of the funds listed on Attachment A, certify that: 1. I have reviewed each report on Form N-CSR of the funds listed on Attachment A: 2. Based on my knowledge, each report does not contain any untrue statements of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by each report; 3. Based on my knowledge, the financial statements, and other financial information included in each report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in each report; 4. Each registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in rule 30a-3(c) under the Investment Company Act) for the registrants and have: a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which each report are being prepared; b) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report (the "Evaluation Date") based on such evaluation; and c) disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting. 5. Each registrant's other certifying officers and I have disclosed to each registrant's auditors and the audit committee of each registrant's board of directors (or persons performing the equivalent functions): a) all significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect each registrant's ability to record, process, summarize, and report financial information; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in each registrant's internal controls. /s/Charles E. Porter Date: December 23, 2003 - ---------------------- ------------------------ Charles E. Porter, Principal Financial Officer Certifications - -------------- I, Karnig H. Durgarian, the principal executive officer of the funds listed on Attachment A, certify that: 1. I have reviewed each report on Form N-CSR of the funds listed on Attachment A: 2. Based on my knowledge, each report does not contain any untrue statements of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by each report; 3. Based on my knowledge, the financial statements, and other financial information included in each report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in each report; 4. Each registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in rule 30a-3(c) under the Investment Company Act) for the registrants and have: a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which each report are being prepared; b) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report (the "Evaluation Date") based on such evaluation; and c) disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting. 5. Each registrant's other certifying officers and I have disclosed to each registrant's auditors and the audit committee of each registrant's board of directors (or persons performing the equivalent functions): a) all significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect each registrant's ability to record, process, summarize, and report financial information; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in each registrant's internal controls. /s/Karnig H. Durgarian Date: December 23, 2003 - ---------------------- ------------------------ Karnig H. Durgarian, Principal Executive Officer Certifications - -------------- I, Steven D. Krichmar, a principal financial officer of the funds listed on Attachment A, certify that: 1. I have reviewed each report on Form N-CSR of the funds listed on Attachment A: 2. Based on my knowledge, each report does not contain any untrue statements of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by each report; 3. Based on my knowledge, the financial statements, and other financial information included in each report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in each report; 4. Each registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in rule 30a-3(c) under the Investment Company Act) for the registrants and have: a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which each report are being prepared; b) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report (the "Evaluation Date") based on such evaluation; and c) disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting. 5. Each registrant's other certifying officers and I have disclosed to each registrant's auditors and the audit committee of each registrant's board of directors (or persons performing the equivalent functions): a) all significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect each registrant's ability to record, process, summarize, and report financial information; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in each registrant's internal controls. /s/Steven D. Krichmar Date: December 23, 2003 - ---------------------- ------------------------ Steven D. Krichmar, Principal Financial Officer Attachment A - -------------- Period(s) ended October 31, 2003 002 The Putnam Fund for Growth and Income 004 Putnam Income Fund 005 Putnam Global Equity Fund 008 Putnam Convertible Income-Growth Trust 041 Putnam Global Income Trust 052 Putnam Managed Municipal Income Trust 072 Putnam Master Income Trust 183 Putnam Municipal Bond Fund 184 Putnam California Investment Grade Municipal Trust 185 Putnam New York Investment Grade Municipal Trust 2IE Putnam Growth Fund 2II Putnam Capital Opportunities Fund 2MI Putnam Tax Smart Equity Fund 2OV Putnam Mid Cap Value Fund 582 Putnam Municipal Opportunities Trust 840 Putnam Utilities Growth and Income Fund EX-99.906 CERT 4 exnos3.txt EX-99.906 CERT Section 906 Certifications - --------------------------- I, Charles E. Porter, a principal financial officer of the Funds listed on Attachment A, certify that, to my knowledge: 1. The form N-CSR of the Funds listed on Attachment A for the period ended October 31, 2003 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and 2. The information contained in the Form N-CSR of the Funds listed on Attachment A for the period ended October 31, 2003 fairly presents, in all material respects, the financial condition and results of operations of the Funds listed on Attachment A. /s/Charles E. Porter Date: December 23, 2003 - ---------------------- ------------------------ Charles E. Porter, Principal Financial Officer Section 906 Certifications - --------------------------- I, Karnig H. Durgarian, the principal executive officer of the Funds listed on Attachment A, certify that, to my knowledge: 1. The form N-CSR of the Funds listed on Attachment A for the period ended October 31, 2003 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and 2. The information contained in the Form N-CSR of the Funds listed on Attachment A for the period ended October 31, 2003 fairly presents, in all material respects, the financial condition and results of operations of the Funds listed on Attachment A. /s/Karnig H. Durgarian Date: December 23, 2003 - ---------------------- ------------------------ Karnig H. Durgarian, Principal Executive Officer Section 906 Certifications - --------------------------- I, Steven D. Krichmar, a principal financial officer of the Funds listed on Attachment A, certify that, to my knowledge: 1. The form N-CSR of the Funds listed on Attachment A for the period ended October 31, 2003 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and 2. The information contained in the Form N-CSR of the Funds listed on Attachment A for the period ended October 31, 2003 fairly presents, in all material respects, the financial condition and results of operations of the Funds listed on Attachment A. /s/Steven D. Krichmar Date: December 23, 2003 - ---------------------- ------------------------ Steven D. Krichmar, Principal Financial Officer Attachment A - -------------- Period(s) ended October 31, 2003 002 The Putnam Fund for Growth and Income 004 Putnam Income Fund 005 Putnam Global Equity Fund 008 Putnam Convertible Income-Growth Trust 041 Putnam Global Income Trust 052 Putnam Managed Municipal Income Trust 072 Putnam Master Income Trust 183 Putnam Municipal Bond Fund 184 Putnam California Investment Grade Municipal Trust 185 Putnam New York Investment Grade Municipal Trust 2IE Putnam Growth Fund 2II Putnam Capital Opportunities Fund 2MI Putnam Tax Smart Equity Fund 2OV Putnam Mid Cap Value Fund 582 Putnam Municipal Opportunities Trust 840 Putnam Utilities Growth and Income Fund -----END PRIVACY-ENHANCED MESSAGE-----