BLACKROCK MUNI INTERMEDIATE DURATION FUND, INC.

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number: 811-21348

Name of Fund: BlackRock Muni Intermediate Duration Fund, Inc. (MUI)

Fund Address:  100 Bellevue Parkway, Wilmington, DE 19809

Name and address of agent for service: John M. Perlowski, Chief Executive Officer, BlackRock Muni Intermediate Duration Fund, Inc., 55 East 52nd Street, New York, NY 10055

Registrant’s telephone number, including area code: (800) 882-0052, Option 4

Date of fiscal year end: 04/30/2018

Date of reporting period: 04/30/2018


Item 1 – Report to Stockholders


APRIL 30, 2018

 

ANNUAL REPORT

  LOGO

 

BlackRock MuniAssets Fund, Inc. (MUA)

BlackRock MuniEnhanced Fund, Inc. (MEN)

BlackRock MuniHoldings Fund, Inc. (MHD)

BlackRock MuniHoldings Fund II, Inc. (MUH)

BlackRock MuniHoldings Quality Fund, Inc. (MUS)

BlackRock Muni Intermediate Duration Fund, Inc. (MUI)

BlackRock MuniVest Fund II, Inc. (MVT)

 

Not FDIC Insured • May Lose Value • No Bank Guarantee


The Markets in Review

Dear Shareholder,

In the 12 months ended April 30, 2018, the strongest corporate profits in seven years drove the equity market higher, while rising interest rates constrained bond returns. While the market’s appetite for risk remained healthy, risk taking varied by asset class, as bond investors cautiously shifted to higher-quality securities, and stock investors continued to embrace risk by investing abroad.

The largest global economies experienced sustained, synchronized growth for the first time since the financial crisis, leading to strong equity performance worldwide. Emerging markets stocks posted the highest return, as accelerating growth in China, the second-largest economy in the world, improved the outlook for corporate profits in most developing nations.

Short-term U.S. Treasury interest rates rose the fastest, while longer-term rates slightly increased, leading to a substantial flattening of the yield curve. The annual return for the three-month Treasury bill surpassed 1.0%, but remained well below the annual headline inflation rate of 2.5%. In contrast, the ten-year U.S. Treasury — a bellwether of the bond market — posted a negative return, as rising inflation expectations drove yields higher. In credit markets, the investment-grade and high-yield bond markets posted modest returns in a relatively benign credit environment.

Even though it faced rising pressure to boost interest rates in 2017, the U.S. Federal Reserve (the “Fed”) increased short-term interest rates just three times during the reporting period. The Fed also announced plans to reduce its $4.4 trillion balance sheet by $420 billion in 2018, which began the process of gradually reversing its unprecedented stimulus measures after the financial crisis. The economy continued to gain momentum despite the Fed’s modest reduction of economic stimulus, as unemployment dipped below 4.0%, wages increased, and job openings reached a record high. Strong economic performance may justify a more rapid pace of rate hikes in 2018, as the headline inflation rate and investors’ expectations for inflation surpassed the Fed’s target of 2.0%.

By contrast, the European Central Bank (“ECB”) and the Bank of Japan (“BoJ”) continued to expand their balance sheets despite nascent signs of sustained economic growth. Rising global growth, as well as limited bond supply, pressured other central banks to follow in the Fed’s footsteps. In October 2017, the ECB pledged to cut its bond purchases in half for 2018, while the BoJ reiterated its commitment to economic stimulus, even though the size of its balance sheet almost matched the total output of the Japanese economy.

The Fed’s measured pace of stimulus reduction could lead to moderately higher inflation, steadily rising interest rates, and improving real growth in 2018. We continue to believe the primary risks to economic expansion are trade protectionism, rapidly rising interest rates, and geopolitical tension. In particular, we are closely monitoring trade protectionism and the rise of populism in Western nations.

In December 2017, Congress passed a sweeping tax reform bill. The U.S. tax overhaul is likely to accentuate the existing reflationary themes, including corporate spending on stock buybacks, mergers & acquisitions and capital investment, which could extend the economic cycle if inflation and interest rates rise at a relatively modest pace.

In this environment, investors need to think globally, extend their scope across a broad array of asset classes, and be nimble as market conditions change. We encourage you to talk with your financial advisor and visit blackrock.com for further insight about investing in today’s markets.

Sincerely,

 

LOGO

Rob Kapito

President, BlackRock Advisors, LLC

LOGO

Rob Kapito

President, BlackRock Advisors, LLC

 

Total Returns as of April 30, 2018
     6-month   12-month

U.S. large cap equities
(S&P 500® Index)

  3.82%   13.27%

U.S. small cap equities
(Russell 2000® Index)

  3.27   11.54

International equities
(MSCI Europe, Australasia,
Far East Index)

  3.41   14.51

Emerging market equities
(MSCI Emerging Markets Index)

  4.80   21.71

3-month Treasury bills
(ICE BofAML 3-Month U.S. Treasury Bill Index)

  0.68   1.17

U.S. Treasury securities
(ICE BofAML 10-Year U.S. Treasury Index)

  (3.79)   (3.64)

U.S. investment grade bonds
(Bloomberg Barclays U.S.
Aggregate Bond Index)

  (1.87)   (0.32)

Tax-exempt municipal bonds
(S&P Municipal Bond Index)

  (0.76)   1.44

U.S. high yield bonds
(Bloomberg Barclays U.S. Corporate High Yield 2% Issuer
Capped Index)

  (0.17)   3.27
Past performance is no guarantee of future results. Index performance is shown for illustrative purposes only. You cannot invest directly in an index.
 

 

 

2    THIS PAGE IS NOT PART OF YOUR FUND REPORT


Table of Contents

 

      Page  

The Markets in Review

     2  

Annual Report:

  

Municipal Market Overview

     4  

The Benefits and Risks of Leveraging

     5  

Derivative Financial Instruments

     5  

Fund Summaries

     6  

Financial Statements:

  

Schedules of Investments

     20  

Statements of Assets and Liabilities

     69  

Statements of Operations

     71  

Statements of Changes in Net Assets

     73  

Statements of Cash Flows

     80  

Financial Highlights

     82  

Notes to Financial Statements

     89  

Report of Independent Registered Public Accounting Firm

     100  

Automatic Dividend Reinvestment Plan

     101  

Director and Officer Information

     102  

Additional Information

     105  

Glossary of Terms Used in this Report

     107  

 

 

     3  


Municipal Market Overview  For the Reporting Period Ended April 30, 2018

 

Municipal Market Conditions

Municipal bonds experienced positive performance during the period despite rising interest rates resulting from continued Fed monetary policy normalization, firmer economic data, and the anticipated impacts of fiscal stimulus. Ongoing reassurance from the Fed that rates would be increased gradually and would likely remain low overall resulted in continued demand for fixed income investments. More specifically, investors favored the tax-exempt income, diversification, quality, and value of municipal bonds amid fiscal policy uncertainty, which saw tax reform ultimately lower the top individual tax rate just 2.6% while eliminating deductions and increasing demand for tax shelter. During the 12 months ended April 30, 2018, municipal bond funds experienced net inflows of approximately $26 billion (based on data from the Investment Company Institute).

 

For the same 12-month period, total new issuance was moderate from a historical perspective at $385 billion (well below the robust $424 billion issued in the prior 12-month period), but displayed significant month to month volatility. Notably, issuance in December posted the highest monthly total on record at $56 billion, as issuers rushed deals to market ahead of the expected elimination of the tax-exemption for advanced refunding bonds and possibly private activity bonds (PABs). Ultimately, the final version of the Tax Cuts and Jobs Act left PABs unchanged, though the elimination of advanced refundings has suppressed supply in 2018, providing a powerful technical tailwind.   S&P Municipal Bond Index

 

Total Returns as of April 30, 2018

 

  6 months: (0.76)%

 

12 months: 1.44%

 

A Closer Look at Yields

 

LOGO

From April 30, 2017 to April 30, 2018, yields on AAA-rated 30-year municipal bonds increased by 7 basis points (“bps”) from 3.02% to 3.09%, while 10-year rates increased by 35 bps from 2.14% to 2.49% and 5-year rates increased by 78 bps from 1.41% to 2.19% (as measured by Thomson Municipal Market Data). The municipal yield curve bear flattened significantly over the 12-month period with the spread between 2- and 30-year maturities flattening by 82 bps, led by 54 bps of flattening between 2- and 10-year maturities.

During the same time period, on a relative basis, tax-exempt municipal bonds strongly outperformed U.S. Treasuries with the greatest outperformance experienced in the front and intermediate portions of the yield curve. The relative positive performance of municipal bonds was driven largely by a supply/demand imbalance within the municipal market as investors sought income and incremental yield in an environment where opportunities became increasingly scarce. The asset class is known for its lower relative volatility and preservation of principal with an emphasis on income as tax rates rise.

Financial Conditions of Municipal Issuers

The majority of municipal credits remain strong, despite well-publicized distress among a few issuers. Four of the five states with the largest amount of debt outstanding — California, New York, Texas and Florida — have exhibited markedly improved credit fundamentals during the slow national recovery. However, several states with the largest unfunded pension liabilities have seen their bond prices decline noticeably and remain vulnerable to additional price deterioration. On the local level, Chicago’s credit quality downgrade is an outlier relative to other cities due to its larger pension liability and inadequate funding remedies. BlackRock maintains the view that municipal bond defaults will remain minimal and in the periphery while the overall market is fundamentally sound. We continue to advocate careful credit research and believe that a thoughtful approach to structure and security selection remains imperative amid uncertainty in a modestly improving economic environment.

The opinions expressed are those of BlackRock as of April 30, 2018, and are subject to change at any time due to changes in market or economic conditions. The comments should not be construed as a recommendation of any individual holdings or market sectors. Investing involves risk including loss of principal. Bond values fluctuate in price so the value of your investment can go down depending on market conditions. Fixed income risks include interest-rate and credit risk. Typically, when interest rates rise, there is a corresponding decline in bond values. Credit risk refers to the possibility that the bond issuer will not be able to make principal and interest payments. There may be less information on the financial condition of municipal issuers than for public corporations. The market for municipal bonds may be less liquid than for taxable bonds. Some investors may be subject to Alternative Minimum Tax (“AMT”). Capital gains distributions, if any, are taxable.

The Standard & Poor’s Municipal Bond Index, a broad, market value-weighted index, seeks to measure the performance of the U.S. municipal bond market. All bonds in the index are exempt from U.S. federal income taxes or subject to the AMT. Past performance is no guarantee of future results. Index performance is shown for illustrative purposes only. It is not possible to invest directly in an index.

 

 

4    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


The Benefits and Risks of Leveraging

 

The Funds may utilize leverage to seek to enhance the distribution rate on, and net asset value (“NAV”) of, their common shares (“Common Shares”). However, there is no guarantee that these objectives can be achieved in all interest rate environments.

In general, the concept of leveraging is based on the premise that the financing cost of leverage, which is based on short-term interest rates, is normally lower than the income earned by a Fund on its longer-term portfolio investments purchased with the proceeds from leverage. To the extent that the total assets of the Funds (including the assets obtained from leverage) are invested in higher-yielding portfolio investments, the Funds’ shareholders benefit from the incremental net income. The interest earned on securities purchased with the proceeds from leverage is paid to shareholders in the form of dividends, and the value of these portfolio holdings is reflected in the per share NAV.

To illustrate these concepts, assume a Fund’s Common Shares capitalization is $100 million and it utilizes leverage for an additional $30 million, creating a total value of $130 million available for investment in longer-term income securities. If prevailing short-term interest rates are 3% and longer-term interest rates are 6%, the yield curve has a strongly positive slope. In this case, a Fund’s financing costs on the $30 million of proceeds obtained from leverage are based on the lower short-term interest rates. At the same time, the securities purchased by a Fund with the proceeds from leverage earn income based on longer-term interest rates. In this case, a Fund’s financing cost of leverage is significantly lower than the income earned on a Fund’s longer-term investments acquired from such leverage proceeds, and therefore the holders of Common Shares (“Common Shareholders”) are the beneficiaries of the incremental net income.

However, in order to benefit Common Shareholders, the return on assets purchased with leverage proceeds must exceed the ongoing costs associated with the leverage. If interest and other costs of leverage exceed the Funds’ return on assets purchased with leverage proceeds, income to shareholders is lower than if the Funds had not used leverage. Furthermore, the value of the Funds’ portfolio investments generally varies inversely with the direction of long-term interest rates, although other factors can influence the value of portfolio investments. In contrast, the value of the Funds’ obligations under their respective leverage arrangements generally does not fluctuate in relation to interest rates. As a result, changes in interest rates can influence the Funds’ NAVs positively or negatively. Changes in the future direction of interest rates are very difficult to predict accurately, and there is no assurance that the Funds’ intended leveraging strategy will be successful.

The use of leverage also generally causes greater changes in each Fund’s NAV, market price and dividend rates than comparable portfolios without leverage. In a declining market, leverage is likely to cause a greater decline in the NAV and market price of a Fund’s Common Shares than if the Fund were not leveraged. In addition, each Fund may be required to sell portfolio securities at inopportune times or at distressed values in order to comply with regulatory requirements applicable to the use of leverage or as required by the terms of leverage instruments, which may cause the Fund to incur losses. The use of leverage may limit a Fund’s ability to invest in certain types of securities or use certain types of hedging strategies. Each Fund incurs expenses in connection with the use of leverage, all of which are borne by Common Shareholders and may reduce income to the Common Shares. Moreover, to the extent the calculation of the Funds’ investment advisory fees includes assets purchased with the proceeds of leverage, the investment advisory fees payable to the Funds’ investment adviser will be higher than if the Funds did not use leverage.

To obtain leverage, each Fund has issued Variable Rate Demand Preferred Shares (“VRDP Shares”) and Variable Rate Muni Term Preferred Shares (“VMTP Shares”) (collectively, “Preferred Shares”) and/or leveraged its assets through the use of tender option bond trusts (“TOB Trusts”) as described in the Notes to Financial Statements.

Under the Investment Company Act of 1940, as amended (the “1940 Act”), each Fund is permitted to issue debt up to 33 1/3% of its total managed assets or equity securities (e.g., Preferred Shares) up to 50% of its total managed assets. A Fund may voluntarily elect to limit its leverage to less than the maximum amount permitted under the 1940 Act. In addition, a Fund may also be subject to certain asset coverage, leverage or portfolio composition requirements imposed by the Preferred Shares’ governing instruments or by agencies rating the Preferred Shares, which may be more stringent than those imposed by the 1940 Act.

If a Fund segregates or designates on its books and records cash or liquid assets having a value not less than the value of a Fund’s obligations under the TOB Trust (including accrued interest), then the TOB Trust is not considered a senior security and is not subject to the foregoing limitations and requirements imposed by the 1940 Act.

Derivative Financial Instruments

The Funds may invest in various derivative financial instruments. These instruments are used to obtain exposure to a security, commodity, index, market, and/or other assets without owning or taking physical custody of securities, commodities and/or other referenced assets or to manage market, equity, credit, interest rate, foreign currency exchange rate, commodity and/or other risks. Derivative financial instruments may give rise to a form of economic leverage and involve risks, including the imperfect correlation between the value of a derivative financial instrument and the underlying asset, possible default of the counterparty to the transaction or illiquidity of the instrument. The Funds’ successful use of a derivative financial instrument depends on the investment adviser’s ability to predict pertinent market movements accurately, which cannot be assured. The use of these instruments may result in losses greater than if they had not been used, may limit the amount of appreciation a Fund can realize on an investment and/or may result in lower distributions paid to shareholders. The Funds’ investments in these instruments, if any, are discussed in detail in the Notes to Financial Statements.

 

 

THE BENEFITS AND RISKS OF LEVERAGING / DERIVATIVE FINANCIAL INSTRUMENTS      5  


Fund Summary  as of April 30, 2018    BlackRock MuniAssets Fund, Inc.

 

Investment Objective

BlackRock MuniAssets Fund, Inc.’s (MUA) (the “Fund”) investment objective is to provide high current income exempt from U.S. federal income taxes by investing primarily in a portfolio of medium- to lower-grade or unrated municipal obligations, the interest on which, in the opinion of bond counsel to the issuer, is exempt from U.S. federal income taxes. The Fund seeks to achieve its investment objective by investing, under normal market conditions, at least 80% of its assets in municipal bonds exempt from U.S. federal income taxes (except that the interest may be subject to the U.S. federal alternative minimum tax). The Fund invests at least 65% of its assets in municipal bonds that are rated in the medium to lower rating categories by nationally recognized rating services (for example, Baa or lower by Moody’s Investors Service, Inc. (“Moody’s”) or BBB or lower by Standard & Poor’s Corporation (“S&P”), or securities that are unrated but are deemed by the investment adviser to be of comparable quality at the time of investment. The Fund may invest directly in such securities or synthetically through the use of derivatives.

No assurance can be given that the Fund’s investment objective will be achieved.

Fund Information

 

Symbol on New York Stock Exchange (“NYSE”)

  MUA

Initial Offering Date

  June 25, 1993

Yield on Closing Market Price as of April 30, 2018 ($13.21)(a)

  4.95%

Tax Equivalent Yield(b)

  8.36%

Current Monthly Distribution per Common Share(c)

  $0.0545

Current Annualized Distribution per Common Share(c)

  $0.6540

Economic Leverage as of April 30, 2018(d)

  12%

 

  (a)  Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.  
  (b)  Tax equivalent yield assumes the maximum marginal U.S. federal tax rate of 40.8%, which includes the 3.8% Medicare tax. Actual tax rates will vary based on income, exemptions and deductions. Lower taxes will result in lower tax equivalent yields.  
  (c)  The distribution rate is not constant and is subject to change.  
  (d)  Represents TOB Trusts as a percentage of total managed assets, which is the total assets of the Fund, including any assets attributable to TOB Trusts, minus the sum of its accrued liabilities. For a discussion of leveraging techniques utilized by the Fund, please see The Benefits and Risks of Leveraging on page 5.  

Performance

Returns for the 12 months ended April 30, 2018 were as follows:

 

    Returns Based On  
     Market Price      NAV  

MUA(a)(b)

    (6.48 )%       4.47

Lipper High Yield Municipal Debt Funds(c)

    (0.77      4.04  

 

  (a)  All returns reflect reinvestment of dividends and/or distributions at actual reinvestment prices.  
  (b)  The Fund moved from a premium to NAV to a discount during the period, which accounts for the difference between performance based on market price and performance based on NAV.  
  (c)  Average return. Returns reflect reinvestment of dividends and/or distributions at NAV on the ex-dividend date as calculated by Lipper.  

Performance results may include adjustments made for financial reporting purposes in accordance with U.S. generally accepted accounting principles.

Past performance is not indicative of future results.

The following discussion relates to the Fund’s absolute performance based on NAV:

 

  Municipal bonds generated positive returns, with income offsetting a modest downturn in prices. The reporting period began on a strong note, with a favorable balance of supply and demand driving prices higher in the summer of 2017. By autumn, however, accelerating economic growth and emerging inflation pressures sparked concerns that the Fed would need to tighten monetary policy more aggressively than expected. In addition, the prospect of tax reform led to a pick-up in new-issue supply prior to year-end. These factors drove municipal bond prices lower in late 2017, and the selloff picked up speed in late January/early February due to a spike in U.S. Treasury yields. (Prices and yields move in opposite directions.) The tax-exempt market subsequently stabilized at these lower levels, and it traded largely flat with low volatility through the end of the period.

 

  The Fund’s positions in the tobacco and health care sectors, as well as in select development district and single-site project-financing issues, contributed to performance. Holdings in unrated securities and bonds in the B, BB and BBB rating categories, which performed well amid investors’ hearty appetite for higher-yielding securities, also aided results. Portfolio holdings with the longest maturity dates (typically 20 years and longer) added value given that longer-term bonds outperformed.

 

  Conversely, the Fund’s performance was hurt by positions in shorter-dated holdings — including higher-quality, pre-refunded bonds — that were most affected by the prospect of tighter Fed policy. Intermediate-term holdings, specifically those in the five- to 10-year range, also lagged somewhat.

 

  The Fund sought to manage interest rate risk using U.S. Treasury futures. Given that Treasury yields rose, as prices fell, this aspect of the Fund’s positioning had a positive effect on returns.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

 

 

6    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Fund Summary  as of April 30, 2018 (continued)    BlackRock MuniAssets Fund, Inc.

 

Market Price and Net Asset Value Per Share Summary

 

     04/30/18      04/30/17      Change      High      Low  

Market Price

  $ 13.21      $ 14.82        (10.86 )%     $ 15.84      $ 13.14  

Net Asset Value

    14.01        14.07        (0.43      14.29        13.98  

Market Price and Net Asset Value History For the Past Five Years

 

LOGO

Overview of the Fund’s Total Investments*

 

SECTOR ALLOCATION

 

Sector  

04/30/18

    04/30/17  

Health

    22     22

County/City/Special District/School District

    17       13  

Tobacco

    16       16  

Transportation

    15       19  

Education

    10       10  

Utilities

    9       8  

Corporate

    6       7  

State

    3       3  

Housing

    2       2  

For Fund compliance purposes, the Fund’s sector classifications refer to one or more of the sector sub-classifications used by one or more widely recognized market indexes or rating group indexes, and/or as defined by the investment adviser. These definitions may not apply for purposes of this report, which may combine such sector sub-classifications for reporting ease.

CALL/MATURITY SCHEDULE (c)

 

Calendar Year Ended December 31,

       

2018

    18

2019

    5  

2020

    12  

2021

    18  

2022

   
6
 

 

  (c)  Scheduled maturity dates and/or bonds that are subject to potential calls by issuers over the next five years.  
  * Excludes short-term securities.  

CREDIT QUALITY ALLOCATION (a)

 

Credit Rating  

04/30/18

    04/30/17  

AAA/Aaa

    1    

AA/Aa

    18       19  

A

    7       8  

BBB/Baa

    21       21  

BB/Ba

    12       9  

B/B

    19       11  

CCC/Caa

    1       1  

N/R(b)

    21       31  

 

  (a)  For financial reporting purposes, credit quality ratings shown above reflect the highest rating assigned by either S&P or Moody’s if ratings differ. These rating agencies are independent, nationally recognized statistical rating organizations and are widely used. Investment grade ratings are credit ratings of BBB/Baa or higher. Below investment grade ratings are credit ratings of BB/Ba or lower. Investments designated N/R are not rated by either rating agency. Unrated investments do not necessarily indicate low credit quality. Credit quality ratings are subject to change.  
  (b)  The investment adviser evaluates the credit quality of unrated investments based upon certain factors including, but not limited to, credit ratings for similar investments and financial analysis of sectors and individual investments. Using this approach, the investment adviser has deemed certain of these unrated securities as investment grade quality. As of April 30, 2018 and April 30, 2017, the market value of unrated securities deemed by the investment adviser to be investment grade represents less than 1% and 5%, respectively, of the Fund’s total investments.  
 

 

 

FUND SUMMARY      7  


Fund Summary  as of April 30, 2018    BlackRock MuniEnhanced Fund, Inc.

 

Investment Objective

BlackRock MuniEnhanced Fund, Inc.’s (MEN) (the “Fund”) investment objective is to provide shareholders with as high a level of current income exempt from U.S. federal income taxes as is consistent with its investment policies and prudent investment management. The Fund seeks to achieve its investment objective by investing at least 80% of its assets in municipal bonds exempt from U.S. federal income taxes (except that the interest may be subject to the U.S. federal alternative minimum tax). Under normal market conditions, the Fund invests primarily in long-term municipal bonds that are rated investment grade quality or, if unrated, are deemed to be of comparable quality by the investment adviser at the time of investment and invests primarily in long-term municipal bonds with maturities of more than ten years at the time of investment. The Fund may invest directly in such securities or synthetically through the use of derivatives.

No assurance can be given that the Fund’s investment objective will be achieved.

Fund Information

 

Symbol on NYSE

  MEN

Initial Offering Date

  March 2, 1989

Yield on Closing Market Price as of April 30, 2018 ($10.48)(a)

  5.50%

Tax Equivalent Yield(b)

  9.29%

Current Monthly Distribution per Common Share(c)

  $0.0480

Current Annualized Distribution per Common Share(c)

  $0.5760

Economic Leverage as of April 30, 2018(d)

  38%

 

 

  (a)  Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.  
  (b)  Tax equivalent yield assumes the maximum marginal U.S. federal tax rate of 40.8%, which includes the 3.8% Medicare tax. Actual tax rates will vary based on income, exemptions and deductions. Lower taxes will result in lower tax equivalent yields.  
  (c)  The distribution rate is not constant and is subject to change.  
  (d)  Represents VRDP Shares and TOB Trusts as a percentage of total managed assets, which is the total assets of the Fund, including any assets attributable to VRDP Shares and TOB Trusts, minus the sum of its accrued liabilities. For a discussion of leveraging techniques utilized by the Fund, please see The Benefits and Risks of Leveraging on page 5.  

Performance

Returns for the 12 months ended April 30, 2018 were as follows:

 

    Returns Based On  
     Market Price      NAV  

MEN(a)(b)

    (5.23 )%       2.93

Lipper General & Insured Municipal Debt Funds (Leveraged)(c)

    (2.37      2.65  

 

  (a)  All returns reflect reinvestment of dividends and/or distributions at actual reinvestment prices.  
  (b)  The Fund’s discount to NAV widened during the period, which accounts for the difference between performance based on market price and performance based on NAV.  
  (c)  Average return. Returns reflect reinvestment of dividends and/or distributions at NAV on the ex-dividend date as calculated by Lipper.  

Performance results may include adjustments made for financial reporting purposes in accordance with U.S. generally accepted accounting principles.

Past performance is not indicative of future results.

The following discussion relates to the Fund’s absolute performance based on NAV:

 

  Municipal bonds generated positive returns, with income offsetting a modest downturn in prices. The reporting period began on a strong note, with a favorable balance of supply and demand driving prices higher in the summer of 2017. By autumn, however, accelerating economic growth and emerging inflation pressures sparked concerns that the Fed would need to tighten monetary policy more aggressively than expected. In addition, the prospect of tax reform led to a pick-up in new-issue supply prior to year-end. These factors drove municipal bond prices lower in late 2017, and the selloff picked up speed in late January/early February due to a spike in U.S. Treasury yields. (Prices and yields move in opposite directions.) The tax-exempt market subsequently stabilized at these lower levels, and it traded largely flat with low volatility through the end of the period.

 

  During the reporting period, the Fund produced a gain at net asset value. Its return was primarily derived from income given that bond prices fell slightly.

 

  The lower end of the investment-grade segment outperformed higher-quality securities in the period. As a result, the Fund’s holdings in bonds rated A and BBB aided returns. Consistent with this trend, allocations to sectors with lower average credit ratings — including transportation and health care — were additive to results.

 

  The Fund benefited from its allocation to longer-term bonds, which outpaced short-term issues. Conversely, holdings in pre-refunded securities experienced poor relative performance due to their shorter maturities.

 

  The Fund sought to manage interest rate risk using U.S. Treasury futures. Given that Treasury yields rose, as prices fell, this aspect of the Fund’s positioning had a positive effect on returns.

 

  The Fund’s position in New Jersey appropriated debt, which benefited from meaningful yield spread tightening, further contributed to results.

 

  Investments in bonds subject to the AMT helped performance. Yield spreads tightened due to legislation in the Tax Cuts and Jobs Act — which was passed in December 2017 — that eliminated the corporate AMT and significantly limited the reach of the individual AMT.

 

 

8    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Fund Summary  as of April 30, 2018 (continued)    BlackRock MuniEnhanced Fund, Inc.

 

  The Fund’s use of leverage, while amplifying the impact of weak price performance, was a net contributor since it provided additional income. However, the cost of leverage increased due to rising short-term interest rates.

 

  Although yields rose during the period, reinvestment had an adverse effect on the Fund’s income as the proceeds of higher-yielding bonds that matured or were called needed to be reinvested at lower prevailing rates.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

Market Price and Net Asset Value Per Share Summary

 

    

04/30/18

     04/30/17      Change      High      Low  

Market Price

  $ 10.48      $ 11.69        (10.35 )%     $ 12.45      $ 10.34  

Net Asset Value

    11.46        11.77        (2.63      12.11        11.42  

Market Price and Net Asset Value History For the Past Five Years

 

LOGO

Overview of the Fund’s Total Investments*

 

SECTOR ALLOCATION

 

Sector   04/30/18     04/30/17  

Transportation

    24     24

County/City/Special District/School District

    17       18  

State

    16       15  

Health

    14       12  

Utilities

    13       15  

Education

    9       11  

Corporate

    3       3  

Housing

    2       1  

Tobacco

    2       1  

For Fund compliance purposes, the Fund’s sector classifications refer to one or more of the sector sub-classifications used by one or more widely recognized market indexes or rating group indexes, and/or as defined by the investment adviser. These definitions may not apply for purposes of this report, which may combine such sector sub-classifications for reporting ease.

CALL/MATURITY SCHEDULE (c)

 

Calendar Year Ended December 31,

       

2018

    9

2019

    14  

2020

    3  

2021

    11  

2022

    7  

 

  (c)  Scheduled maturity dates and/or bonds that are subject to potential calls by issuers over the next five years.  
  * Excludes short-term securities.  

CREDIT QUALITY ALLOCATION (a)

 

Credit Rating   04/30/18     04/30/17  

AAA/Aaa

    7     11

AA/Aa

    51       57  

A

    23       17  

BBB/Baa

    13       12  

BB/Ba

    2        

N/R(b)

    4       3  

 

  (a)  For financial reporting purposes, credit quality ratings shown above reflect the highest rating assigned by either S&P or Moody’s if ratings differ. These rating agencies are independent, nationally recognized statistical rating organizations and are widely used. Investment grade ratings are credit ratings of BBB/Baa or higher. Below investment grade ratings are credit ratings of BB/Ba or lower. Investments designated N/R are not rated by either rating agency. Unrated investments do not necessarily indicate low credit quality. Credit quality ratings are subject to change.  
  (b)  The investment adviser evaluates the credit quality of unrated investments based upon certain factors including but not limited to, credit ratings for similar investments and financial analysis of sectors and individual investments. Using this approach, the investment adviser has deemed certain of these unrated securities as investment grade quality. As of April 30, 2018 and April 30, 2017, the market value of unrated securities deemed by the investment adviser to be investment grade each represents less than 1% of the Fund’s total investments.  
 

 

 

FUND SUMMARY      9  


Fund Summary  as of April 30, 2018    BlackRock MuniHoldings Fund, Inc.

 

Investment Objective

BlackRock MuniHoldings Fund, Inc.’s (MHD) (the “Fund”) investment objective is to provide shareholders with current income exempt from U.S. federal income taxes. The Fund seeks to achieve its investment objective by investing at least 80% of its assets in municipal bonds exempt from U.S. federal income taxes (except that the interest may be subject to the U.S. federal alternative minimum tax). The Fund invests, under normal market conditions, at least 75% of its assets in municipal bonds that are rated investment grade or, if unrated, are deemed to be of comparable quality by the investment adviser at the time of investment and invests primarily in long-term municipal bonds with a maturity of more than ten years at the time of investment. The Fund may invest directly in such securities or synthetically through the use of derivatives.

No assurance can be given that the Fund’s investment objective will be achieved.

Fund Information

 

Symbol on NYSE

  MHD

Initial Offering Date

  May 2, 1997

Yield on Closing Market Price as of April 30, 2018 ($14.98)(a)

  5.61%

Tax Equivalent Yield(b)

  9.48%

Current Monthly Distribution per Common Share(c)

  $0.0700

Current Annualized Distribution per Common Share(c)

  $0.8400

Economic Leverage as of April 30, 2018(d)

  37%

 

  (a)  Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.  
  (b)  Tax equivalent yield assumes the maximum marginal U.S. federal tax rate of 40.8%, which includes the 3.8% Medicare tax. Actual tax rates will vary based on income, exemptions and deductions. Lower taxes will result in lower tax equivalent yields.  
  (c)  The distribution rate is not constant and is subject to change.  
  (d)  Represents VMTP Shares and TOB Trusts as a percentage of total managed assets, which is the total assets of the Fund, including any assets attributable to VMTP Shares and TOB Trusts, minus the sum of its accrued liabilities. For a discussion of leveraging techniques utilized by the Fund, please see The Benefits and Risks of Leveraging on page 5.  

Performance

Returns for the 12 months ended April 30, 2018 were as follows:

 

    Returns Based On  
     Market Price      NAV  

MHD(a)(b)

    (4.79 )%       3.07

Lipper General & Insured Municipal Debt Funds (Leveraged)(c)

    (2.37      2.65  

 

  (a)  All returns reflect reinvestment of dividends and/or distributions at actual reinvestment prices.  
  (b)  The Fund’s discount to NAV widened during the period, which accounts for the difference between performance based on market price and performance based on NAV.  
  (c)  Average return. Returns reflect reinvestment of dividends and/or distributions at NAV on the ex-dividend date as calculated by Lipper.  

Performance results may include adjustments made for financial reporting purposes in accordance with U.S. generally accepted accounting principles.

Past performance is not indicative of future results.

The following discussion relates to the Fund’s absolute performance based on NAV:

 

  Municipal bonds generated positive returns, with income offsetting a modest downturn in prices. The reporting period began on a strong note, with a favorable balance of supply and demand driving prices higher in the summer of 2017. By autumn, however, accelerating economic growth and emerging inflation pressures sparked concerns that the Fed would need to tighten monetary policy more aggressively than expected. In addition, the prospect of tax reform led to a pick-up in new-issue supply prior to year-end. These factors drove municipal bond prices lower in late 2017, and the selloff picked up speed in late January/early February due to a spike in U.S. Treasury yields. (Prices and yields move in opposite directions.) The tax-exempt market subsequently stabilized at these lower levels, and it traded largely flat with low volatility through the end of the period.

 

  The Fund’s positions in the transportation, tax-backed (state), tobacco and health care sectors contributed to performance. Holdings in lower-rated investment-grade bonds in the A and BBB rating categories, which performed well amid investors’ hearty appetite for higher-yielding securities, also aided results. Portfolio holdings with the longest maturity dates (typically 20 years and longer) added value given that longer-term bonds outperformed.

 

  Conversely, the Fund’s performance was hurt by positions in shorter-dated holdings — including higher-quality, pre-refunded bonds — that were most affected by the prospect of tighter Fed policy. Intermediate-term holdings, specifically those in the 5- to 10-year range, also lagged somewhat.

 

  The Fund sought to manage interest rate risk using U.S. Treasury futures. Given that Treasury yields rose, as prices fell, this aspect of the Fund’s positioning had a positive effect on returns.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

 

 

10    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Fund Summary  as of April 30, 2018 (continued)    BlackRock MuniHoldings Fund, Inc.

 

Market Price and Net Asset Value Per Share Summary

 

     04/30/18      04/30/17      Change      High      Low  

Market Price

  $ 14.98      $ 16.65        (10.03 )%     $ 18.25      $ 14.90  

Net Asset Value

    16.41        16.85        (2.61      17.24        16.36  

Market Price and Net Asset Value History For the Past Five Years

 

LOGO

Overview of the Fund’s Total Investments*

 

SECTOR ALLOCATION

 

Sector   04/30/18     04/30/17  

Transportation

    24     24

Health

    18       19  

Utilities

    14       11  

County/City/Special District/School District

    12       12  

State

    11       12  

Education

    9       11  

Tobacco

    6       5  

Corporate

    5       6  

Housing

    1       (a) 

 

  (a)  Representing less than 1% of the Fund’s total investments.  

For Fund compliance purposes, the Fund’s sector classifications refer to one or more of the sector sub-classifications used by one or more widely recognized market indexes or rating group indexes, and/or as defined by the investment adviser. These definitions may not apply for purposes of this report, which may combine such sector sub-classifications for reporting ease.

CALL/MATURITY SCHEDULE (d)

 

Calendar Year Ended December 31,

       

2018

    8

2019

    23  

2020

    12  

2021

    11  

2022

   
10
 

 

  (d)  Scheduled maturity dates and/or bonds that are subject to potential calls by issuers over the next five years.  
  * Excludes short-term securities.  

CREDIT QUALITY ALLOCATION (b)

 

Credit Rating   04/30/18     04/30/17  

AAA/Aaa

    3     5

AA/Aa

    44       47  

A

    20       19  

BBB/Baa

    15       16  

BB/Ba

    4       4  

B

    4       2  

N/R(c)

    10       7  

 

  (b)  For financial reporting purposes, credit quality ratings shown above reflect the highest rating assigned by either S&P or Moody’s if ratings differ. These rating agencies are independent, nationally recognized statistical rating organizations and are widely used. Investment grade ratings are credit ratings of BBB/Baa or higher. Below investment grade ratings are credit ratings of BB/Ba or lower. Investments designated N/R are not rated by either rating agency. Unrated investments do not necessarily indicate low credit quality. Credit quality ratings are subject to change.  
  (c)  The investment adviser evaluates the credit quality of unrated investments based upon certain factors including, but not limited to, credit ratings for similar investments and financial analysis of sectors and individual investments. Using this approach, the investment adviser has deemed certain of these unrated securities as investment grade quality. As of April 30, 2018 and April 30, 2017, the market value of unrated securities deemed by the investment adviser to be investment grade each represents 1% of the Fund’s total investments.  
 

 

 

FUND SUMMARY      11  


Fund Summary  as of April 30, 2018    BlackRock MuniHoldings Fund II, Inc.

 

Investment Objective

BlackRock MuniHoldings Fund II, Inc.’s (MUH) (the “Fund”) investment objective is to provide shareholders with current income exempt from U.S. federal income taxes. The Fund seeks to achieve its investment objective by investing, under normal market conditions, at least 80% of its assets in municipal bonds exempt from U.S. federal income taxes (except that the interest may be subject to the U.S. federal alternative minimum tax). The Fund invests, under normal market conditions, at least 75% of its assets in municipal bonds that are rated investment grade or, if unrated, are deemed to be of comparable quality by the investment adviser at the time of investment and invests primarily in long-term municipal bonds with a maturity of more than ten years at the time of investment. The Fund may invest directly in such securities or synthetically through the use of derivatives.

No assurance can be given that the Fund’s investment objective will be achieved.

Fund Information

 

Symbol on NYSE

  MUH

Initial Offering Date

  February 27, 1998

Yield on Closing Market Price as of April 30, 2018 ($13.75)(a)

  5.89%

Tax Equivalent Yield(b)

  9.95%

Current Monthly Distribution per Common Share(c)

  $0.0675

Current Annualized Distribution per Common Share(c)

  $0.8100

Economic Leverage as of April 30, 2018(d)

  37%

 

  (a)  Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.  
  (b)  Tax equivalent yield assumes the maximum marginal U.S. federal tax rate of 40.8%, which includes the 3.8% Medicare tax. Actual tax rates will vary based on income, exemptions and deductions. Lower taxes will result in lower tax equivalent yields.  
  (c)  The distribution rate is not constant and is subject to change.  
  (d)  Represents VMTP Shares and TOB Trusts as a percentage of total managed assets, which is the total assets of the Fund, including any assets attributable to VMTP Shares and TOB Trusts, minus the sum of its accrued liabilities. For a discussion of leveraging techniques utilized by the Fund, please see The Benefits and Risks of Leveraging on page 5.  

Performance

Returns for the 12 months ended April 30, 2018 were as follows:

 

    Returns Based On  
     Market Price      NAV  

MUH(a)(b)

    (6.61 )%       3.09

Lipper General & Insured Municipal Debt Funds (Leveraged)(c)

    (2.37      2.65  

 

  (a)  All returns reflect reinvestment of dividends and/or distributions at actual reinvestment prices.  
  (b)  The Fund moved from a premium to NAV to a discount during the period, which accounts for the difference between performance based on market price and performance based on NAV.  
  (c)  Average return. Returns reflect reinvestment of dividends and/or distributions at NAV on the ex-dividend date as calculated by Lipper.  

Performance results may include adjustments made for financial reporting purposes in accordance with U.S. generally accepted accounting principles.

Past performance is not indicative of future results.

The following discussion relates to the Fund’s absolute performance based on NAV:

 

  Municipal bonds generated positive returns, with income offsetting a modest downturn in prices. The reporting period began on a strong note, with a favorable balance of supply and demand driving prices higher in the summer of 2017. By autumn, however, accelerating economic growth and emerging inflation pressures sparked concerns that the Fed would need to tighten monetary policy more aggressively than expected. In addition, the prospect of tax reform led to a pick-up in new-issue supply prior to year-end. These factors drove municipal bond prices lower in late 2017, and the selloff picked up speed in late January/early February due to a spike in U.S. Treasury yields. (Prices and yields move in opposite directions.) The tax-exempt market subsequently stabilized at these lower levels, and it traded largely flat with low volatility through the end of the period.

 

  During the reporting period, the Fund produced a gain at net asset value. Its return was primarily derived from income given that bond prices fell slightly.

 

  Bonds rated below investment grade outpaced investment-grade issues during the period, while the lower end of the investment-grade segment outperformed the highest-quality securities. As a result, the Fund’s holdings in BBB rated and high yield bonds aided returns. Consistent with this trend, allocations to sectors with lower average credit ratings — including tobacco and health care — contributed to results.

 

  Yield curve positioning was largely additive, as the Fund held a significant amount of longer-term issues relative to short-term bonds. Yields of long-maturity bonds, which have lower sensitivity to Fed policy, rose less than those on short-term bonds. Conversely, holdings in pre-refunded securities experienced poor relative performance due to their shorter maturities.

 

  The Fund sought to manage interest rate risk using U.S. Treasury futures. Given that Treasury yields rose, as prices fell, this aspect of the Fund’s positioning had a positive effect on returns.

 

 

12    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Fund Summary  as of April 30, 2018 (continued)    BlackRock MuniHoldings Fund II, Inc.

 

  The Fund’s use of leverage, while amplifying the impact of weak price performance, was a net contributor since it provided additional income. However, the cost of leverage increased due to rising short-term interest rates.

 

  Although yields rose during the period, reinvestment had an adverse effect on the Fund’s income as the proceeds of higher-yielding bonds that matured or were called needed to be reinvested at lower prevailing rates.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

Market Price and Net Asset Value Per Share Summary

 

     04/30/18      04/30/17      Change      High      Low  

Market Price

  $ 13.75      $ 15.59        (11.80 )%     $ 16.63      $ 13.58  

Net Asset Value

    15.11        15.52        (2.64      15.85        15.06  

Market Price and Net Asset Value History For the Past Five Years

 

LOGO

Overview of the Fund’s Total Investments*

 

SECTOR ALLOCATION

 

Sector   04/30/18     04/30/17  

Transportation

    20     23

Health

    20       19  

State

    15       14  

County/City/Special District/School District

    13       12  

Utilities

    10       11  

Education

    9       10  

Tobacco

    6       4  

Corporate

    5       6  

Housing

    2       1  

 

For Fund compliance purposes, the Fund’s sector classifications refer to one or more of the sector sub-classifications used by one or more widely recognized market indexes or rating group indexes, and/or as defined by the investment adviser. These definitions may not apply for purposes of this report, which may combine such sector sub-classifications for reporting ease.

CALL/MATURITY SCHEDULE (c)

 

Calendar Year Ended December 31,

       

2018

    9

2019

    24  

2020

    11  

2021

    11  

2022

   
6
 

 

  (c)  Scheduled maturity dates and/or bonds that are subject to potential calls by issuers over the next five years.  
  * Excludes short-term securities.  

CREDIT QUALITY ALLOCATION (a)

 

Credit Rating   04/30/18     04/30/17  

AAA/Aaa

    4     6

AA/Aa

    46       50  

A

    20       18  

BBB/Baa

    14       15  

BB/Ba

    4       3  

B

    4       1  

N/R(b)

    8       7  

 

  (a)  For financial reporting purposes, credit quality ratings shown above reflect the highest rating assigned by either S&P or Moody’s if ratings differ. These rating agencies are independent, nationally recognized statistical rating organizations and are widely used. Investment grade ratings are credit ratings of BBB/Baa or higher. Below investment grade ratings are credit ratings of BB/Ba or lower. Investments designated N/R are not rated by either rating agency. Unrated investments do not necessarily indicate low credit quality. Credit quality ratings are subject to change.  
  (b)  The investment adviser evaluates the credit quality of unrated investments based upon certain factors including, but not limited to, credit ratings for similar investments and financial analysis of sectors and individual investments. Using this approach, the investment adviser has deemed certain of these unrated securities as investment grade quality. As of April 30, 2018 and April 30, 2017, the market value of unrated securities deemed by the investment adviser to be investment grade each represents 2% and 1%, respectively, of the Fund’s total investments.  
 

 

 

FUND SUMMARY      13  


Fund Summary  as of April 30, 2018    BlackRock MuniHoldings Quality Fund, Inc.

 

Investment Objective

BlackRock MuniHoldings Quality Fund, Inc.’s (MUS) (the “Fund”) investment objective is to provide shareholders with current income exempt from U.S. federal income taxes. The Fund seeks to achieve its investment objective by investing primarily in long-term, investment grade municipal obligations exempt from U.S. federal income taxes (except that the interest may be subject to the U.S. federal alternative minimum tax). Under normal market conditions, the Fund invests at least 80% of its assets in investment grade municipal obligations, and obligations deemed to be of comparable quality by the investment adviser at the time of investment, with remaining maturities of one year or more at the time of investment. The Fund may invest directly in such securities or synthetically through the use of derivatives.

No assurance can be given that the Fund’s investment objective will be achieved.

Fund Information

 

Symbol on NYSE

  MUS

Initial Offering Date

  May 1, 1998

Yield on Closing Market Price as of April 30, 2018 ($12.40)(a)

  6.15%

Tax Equivalent Yield(b)

  10.39%

Current Monthly Distribution per Common Share(c)

  $0.0635

Current Annualized Distribution per Common Share(c)

  $0.7620

Economic Leverage as of April 30, 2018(d)

  38%

 

  (a)  Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.  
  (b)  Tax equivalent yield assumes the maximum marginal U.S. federal tax rate of 40.8%, which includes the 3.8% Medicare tax. Actual tax rates will vary based on income, exemptions and deductions. Lower taxes will result in lower tax equivalent yields.  
  (c)  The distribution rate is not constant and is subject to change.  
  (d)  Represents VMTP Shares and TOB Trusts as a percentage of total managed assets, which is the total assets of the Fund, including any assets attributable to VMTP Shares and TOB Trusts, minus the sum of its accrued liabilities. For a discussion of leveraging techniques utilized by the Fund, please see The Benefits and Risks of Leveraging on page 5.  

Performance

Returns for the 12 months ended April 30, 2018 were as follows:

 

    Returns Based On  
     Market Price      NAV  

MUS(a)(b)

    (1.88 )%       1.33

Lipper General & Insured Municipal Debt Funds (Leveraged)(c)

    (2.37      2.65  

 

  (a)  All returns reflect reinvestment of dividends and/or distributions at actual reinvestment prices.  
  (b)  The Fund’s discount to NAV widened during the period, which accounts for the difference between performance based on market price and performance based on NAV.  
  (c)  Average return. Returns reflect reinvestment of dividends and/or distributions at NAV on the ex-dividend date as calculated by Lipper.  

Performance results may include adjustments made for financial reporting purposes in accordance with U.S. generally accepted accounting principles.

Past performance is not indicative of future results.

The following discussion relates to the Fund’s absolute performance based on NAV:

 

  Municipal bonds generated positive returns, with income offsetting a modest downturn in prices. The reporting period began on a strong note, with a favorable balance of supply and demand driving prices higher in the summer of 2017. By autumn, however, accelerating economic growth and emerging inflation pressures sparked concerns that the Fed would need to tighten monetary policy more aggressively than expected. In addition, the prospect of tax reform led to a pick-up in new-issue supply prior to year-end. These factors drove municipal bond prices lower in late 2017, and the selloff picked up speed in late January/early February due to a spike in U.S. Treasury yields. (Prices and yields move in opposite directions.) The tax-exempt market subsequently stabilized at these lower levels, and it traded largely flat with low volatility through the end of the period.

 

  During the reporting period, the Fund produced a small gain at net asset value. Its return was primarily derived from income given that bond prices fell slightly.

 

  The Fund’s positions in longer-dated bonds were beneficial. Longer-term issues, in addition to providing incremental yield, outpaced shorter maturities due to their lower sensitivity to the direction of Fed policy. Conversely, positions in short-dated securities detracted.

 

  Positions in BBB rated bonds added value, as lower-quality issues outperformed higher-quality securities. At the sector level, transportation and tax-backed (local) issues made the most significant contributions to performance due to their large weightings in the portfolio. The Fund’s position in tobacco bonds — the best performing sector in the index for the period — also contributed positively.

 

  The Fund sought to manage interest rate risk using U.S. Treasury futures. At a time in which Treasury yields rose, as prices fell, this aspect of the Fund’s positioning had a positive effect on returns.

 

  Reinvestment had an adverse effect on the Fund’s income, as the proceeds of higher-yielding bonds that matured or were called needed to be reinvested at lower prevailing rates.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

 

 

14    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Fund Summary  as of April 30, 2018 (continued)    BlackRock MuniHoldings Quality Fund, Inc.

 

Market Price and Net Asset Value Per Share Summary

 

     04/30/18      04/30/17      Change      High      Low  

Market Price

  $ 12.40      $ 13.38        (7.32 )%     $ 14.21      $ 12.30  

Net Asset Value

    13.35        13.95        (4.30      14.17        13.33  

Market Price and Net Asset Value History For the Past Five Years

 

LOGO

Overview of the Fund’s Total Investments*

 

SECTOR ALLOCATION

 

Sector   04/30/18     04/30/17  

Transportation

    31     38

County/City/Special District/School District

    26       25  

Utilities

    14       13  

Health

    8       11  

State

    8       5  

Education

    7       4  

Housing

    3       2  

Tobacco

    2       1  

Corporate

    1       1  

For Fund compliance purposes, the Fund’s sector classifications refer to one or more of the sector sub-classifications used by one or more widely recognized market indexes or rating group indexes, and/or as defined by the investment adviser. These definitions may not apply for purposes of this report, which may combine such sector sub-classifications for reporting ease.

CALL/MATURITY SCHEDULE (b)

 

Calendar Year Ended December 31,

       

2018

    17

2019

    12  

2020

    4  

2021

    18  

2022

    2  

 

  (b)  Scheduled maturity dates and/or bonds that are subject to potential calls by issuers over the next five years.  
  * Excludes short-term securities.  

CREDIT QUALITY ALLOCATION (a)

 

Credit Rating   04/30/18     04/30/17  

AAA/Aaa

    6     6

AA/Aa

    52       56  

A

    28       29  

BBB/Baa

    10       7  

N/R

    4       2  

 

  (a)  For financial reporting purposes, credit quality ratings shown above reflect the highest rating assigned by either S&P or Moody’s if ratings differ. These rating agencies are independent, nationally recognized statistical rating organizations and are widely used. Investment grade ratings are credit ratings of BBB/Baa or higher. Below investment grade ratings are credit ratings of BB/Ba or lower. Investments designated N/R are not rated by either rating agency. Unrated investments do not necessarily indicate low credit quality. Credit quality ratings are subject to change.  
 

 

 

FUND SUMMARY      15  


Fund Summary  as of April 30, 2018    BlackRock Muni Intermediate Duration Fund, Inc.

 

Investment Objective

BlackRock Muni Intermediate Duration Fund, Inc.’s (MUI) (the “Fund”) investment objective is to provide common shareholders with high current income exempt from U.S. federal income taxes. The Fund seeks to achieve its investment objective by investing at least 80% of its assets in municipal bonds exempt from U.S. federal income taxes (except that the interest may be subject to the U.S. federal alternative minimum tax). Under normal market conditions, the Fund invests at least 75% of its assets in municipal bonds that are rated investment grade or, if unrated, are deemed to be of comparable quality by the investment adviser at the time of investment and invests at least 80% of its assets in municipal bonds with a duration of three to ten years at the time of investment. The Fund expects to maintain a dollar-weighted average portfolio duration, as calculated by the investment adviser, of three to ten years. The Fund may invest directly in such securities or synthetically through the use of derivatives.

No assurance can be given that the Fund’s investment objective will be achieved.

Fund Information

 

Symbol on NYSE

  MUI

Initial Offering Date

  August 1, 2003

Yield on Closing Market Price as of April 30, 2018 ($13.01)(a)

  4.10%

Tax Equivalent Yield(b)

  6.93%

Current Monthly Distribution per Common Share(c)

  $0.0445

Current Annualized Distribution per Common Share(c)

  $0.5340

Economic Leverage as of April 30, 2018(d)

  39%

 

  (a)  Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.  
  (b)  Tax equivalent yield assumes the maximum marginal U.S. federal tax rate of 40.8%, which includes the 3.8% Medicare tax. Actual tax rates will vary based on income, exemptions and deductions. Lower taxes will result in lower tax equivalent yields.  
  (c)  The distribution rate is not constant and is subject to change.  
  (d)  Represents VMTP Shares and TOB Trusts as a percentage of total managed assets, which is the total assets of the Fund, including any assets attributable to VMTP Shares and TOB Trusts, minus the sum of its accrued liabilities. For a discussion of leveraging techniques utilized by the Fund, please see The Benefits and Risks of Leveraging on page 5.  

Performance

Returns for the 12 months ended April 30, 2018 were as follows:

 

    Returns Based On  
     Market Price      NAV  

MUI(a)(b)

    (2.69 )%       2.76

Lipper Intermediate Municipal Debt Funds(c)

    (3.26      1.52  

 

  (a)  All returns reflect reinvestment of dividends and/or distributions at actual reinvestment prices.  
  (b)  The Fund’s discount to NAV widened during the period, which accounts for the difference between performance based on market price and performance based on NAV.  
  (c)  Average return. Returns reflect reinvestment of dividends and/or distributions at NAV on the ex-dividend date as calculated by Lipper.  

Performance results may include adjustments made for financial reporting purposes in accordance with U.S. generally accepted accounting principles.

Past performance is not indicative of future results.

The following discussion relates to the Fund’s absolute performance based on NAV:

 

  Municipal bonds generated positive returns, with income offsetting a modest downturn in prices. The reporting period began on a strong note, with a favorable balance of supply and demand driving prices higher in the summer of 2017. By autumn, however, accelerating economic growth and emerging inflation pressures sparked concerns that the Fed would need to tighten monetary policy more aggressively than expected. In addition, the prospect of tax reform led to a pick-up in new-issue supply prior to year-end. These factors drove municipal bond prices lower in late 2017, and the selloff picked up speed in late January/early February due to a spike in U.S. Treasury yields. (Prices and yields move in opposite directions.) The tax-exempt market subsequently stabilized at these lower levels, and it traded largely flat with low volatility through the end of the period.

 

  Portfolio income was a key contributor to performance at a time of falling prices. The Fund’s use of leverage, while amplifying the impact of weak price performance, was a net contributor as it provided additional income. However, the cost of leverage increased due to rising short-term interest rates.

 

  The Fund’s yield curve positioning, highlighted by concentrations in longer-dated maturities, was beneficial. Longer-term bonds, in addition to providing incremental yield, outpaced shorter maturities due to their lower sensitivity to the direction of Fed policy. Conversely, positions in short-dated securities detracted.

 

  Positions in lower-rated investment-grade bonds added value, as higher-yielding, lower-quality securities generally outperformed. At the sector level, positions in tax-backed (state) issues — particularly New Jersey and Illinois and transportation bonds — contributed.

 

  The Fund sought to manage interest rate risk using U.S. Treasury futures. Given that Treasury yields rose, as prices fell, this aspect of the Fund’s positioning had a positive effect on returns.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

 

 

16    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Fund Summary  as of April 30, 2018 (continued)    BlackRock Muni Intermediate Duration Fund, Inc.

 

Market Price and Net Asset Value Per Share Summary

 

     04/30/18      04/30/17      Change      High      Low  

Market Price

  $ 13.01      $ 13.96        (6.81 )%     $ 14.41      $ 12.96  

Net Asset Value

    14.93        15.17        (1.58      15.67        14.90  

Market Price and Net Asset Value History For the Past Five Years

 

LOGO

Overview of the Fund’s Total Investments*

 

SECTOR ALLOCATION

 

Sector   04/30/18     04/30/17  

Transportation

    27     28

County/City/Special District/School District

    17       17  

State

    16       12  

Education

    12       14  

Health

    10       10  

Utilities

    9       11  

Corporate

    5       4  

Tobacco

    3       2  

Housing

    1       2  

For Fund compliance purposes, the Fund’s sector classifications refer to one or more of the sector sub-classifications used by one or more widely recognized market indexes or rating group indexes, and/or as defined by the investment adviser. These definitions may not apply for purposes of this report, which may combine such sector sub-classifications for reporting ease.

CALL/MATURITY SCHEDULE (c)

 

Calendar Year Ended December 31,

       

2018

    3

2019

    8  

2020

    8  

2021

    15  

2022

    5  

 

  (c)  Scheduled maturity dates and/or bonds that are subject to potential calls by issuers over the next five years.  
  * Excludes short-term securities.  

CREDIT QUALITY ALLOCATION (a)

 

Credit Rating   04/30/18     04/30/17  

AAA/Aaa

    5     5

AA/Aa

    37       43  

A

    32       31  

BBB/Baa

    18       16  

BB/Ba

    2       1  

B

    1       1  

N/R(b)

    5       3  

 

  (a)  For financial reporting purposes, credit quality ratings shown above reflect the highest rating assigned by either S&P’s or Moody’s if ratings differ. These rating agencies are independent, nationally recognized statistical rating organizations and are widely used. Investment grade ratings are credit ratings of BBB/Baa or higher. Below investment grade ratings are credit ratings of BB/Ba or lower. Investments designated N/R are not rated by either rating agency. Unrated investments do not necessarily indicate low credit quality. Credit quality ratings are subject to change.  
  (b)  The investment adviser evaluates the credit quality of unrated Investments based upon certain factors including, but not limited to, credit ratings for similar investments and financial analysis of sectors and individual investments. Using this approach, the investment adviser has deemed certain of these unrated securities as investment grade quality. As of April 30, 2018 and April 30, 2017, the market value of unrated securities deemed by the investment adviser to be investment grade represents less than 1% and 1%, respectively, of the Fund’s total investments.  
 

 

 

FUND SUMMARY      17  


Fund Summary  as of April 30, 2018    BlackRock MuniVest Fund II, Inc.

 

Investment Objective

BlackRock MuniVest Fund II, Inc.’s (MVT) (the “Fund”) investment objective is to provide shareholders with as high a level of current income exempt from U.S. federal income taxes as is consistent with its investment policies and prudent investment management. The Fund seeks to achieve its investment objective by investing at least 80% of its assets in municipal bonds exempt from U.S. federal income taxes (except that the interest may be subject to the U.S. federal alternative minimum tax). The Fund invests, under normal market conditions, at least 75% of its assets in municipal bonds that are rated investment grade or, if unrated, are deemed to be of comparable quality by the investment adviser at the time of investment and invests primarily in long-term municipal bonds with a maturity of more than ten years at the time of investment. The Fund may invest directly in such securities or synthetically through the use of derivatives.

No assurance can be given that the Fund’s investment objective will be achieved.

Fund Information

 

Symbol on NYSE

   MVT

Initial Offering Date

   March 29, 1993

Yield on Closing Market Price as of April 30, 2018 ($14.05)(a)

   5.42%

Tax Equivalent Yield(b)

   9.16%

Current Monthly Distribution per Common Share(c)

   $0.0635

Current Annualized Distribution per Common Share(c)

   $0.7620

Economic Leverage as of April 30, 2018(d)

   38%

 

  (a)  Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance does not guarantee future results.  
  (b)  Tax equivalent yield assumes the maximum marginal U.S. federal tax rate of 40.8%, which includes the 3.8% Medicare tax. Actual tax rates will vary based on income, exemptions and deductions. Lower taxes will result in lower tax equivalent yields.  
  (c)  The distribution rate is not constant and is subject to change.  
  (d)  Represents VMTP Shares and TOB Trusts as a percentage of total managed assets, which is the total assets of the Fund, including any assets attributable to VMTP Shares and TOB Trusts, minus the sum of its accrued liabilities. For a discussion of leveraging techniques utilized by the Fund, please see The Benefits and Risks of Leveraging on page 5.  

Performance

Returns for the 12 months ended April 30, 2018 were as follows:

 

    Returns Based On  
     Market Price      NAV  

MVT(a)(b)

    (3.74 )%       2.79

Lipper General & Insured Municipal Debt Funds (Leveraged)(c)

    (2.37      2.65  

 

  (a)  All returns reflect reinvestment of dividends and/or distributions at actual reinvestment prices.  
  (b)  The Fund moved from a premium to NAV to a discount during the period, which accounts for the difference between performance based on market price and performance based on NAV.  
  (c)  Average return. Returns reflect reinvestment of dividends and/or distributions at NAV on the ex-dividend date as calculated by Lipper.  

Performance results may include adjustments made for financial reporting purposes in accordance with U.S. generally accepted accounting principles.

Past performance is not indicative of future results.

The following discussion relates to the Fund’s absolute performance based on NAV:

 

  Municipal bonds generated positive returns, with income offsetting a modest downturn in prices. The reporting period began on a strong note, with a favorable balance of supply and demand driving prices higher in the summer of 2017. By autumn, however, accelerating economic growth and emerging inflation pressures sparked concerns that the Fed would need to tighten monetary policy more aggressively than expected. In addition, the prospect of tax reform led to a pick-up in new-issue supply prior to year-end. These factors drove municipal bond prices lower in late 2017, and the selloff picked up speed in late January/early February due to a spike in U.S. Treasury yields. (Prices and yields move in opposite directions.) The tax-exempt market subsequently stabilized at these lower levels, and it traded largely flat with low volatility through the end of the period.

 

  The Fund’s positions in the transportation, tax-backed (state), single-site project finance and tobacco sectors contributed to performance. Holdings in lower-rated investment-grade bonds in the A and BBB rating categories, which performed well amid investors’ hearty appetite for higher-yielding securities, also aided results. Portfolio holdings with the longest maturity dates (typically 20 years and longer) added value given that longer-term bonds outperformed.

 

  Conversely, the Fund’s performance was hurt by positions in shorter-dated holdings — including higher-quality, pre-refunded bonds — that were most affected by the prospect of tighter Fed policy. Intermediate-term holdings, specifically those in the 5- to 10-year range, also lagged somewhat.

 

  The Fund sought to manage interest rate risk using U.S. Treasury futures. Given that Treasury yields rose, as prices fell, this aspect of the Fund’s positioning had a positive effect on returns.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

 

 

18    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Fund Summary  as of April 30, 2018 (continued)    BlackRock MuniVest Fund II, Inc.

 

Market Price and Net Asset Value Per Share Summary

 

     04/30/18      04/30/17      Change      High      Low  

Market Price

  $ 14.05      $ 15.45        (9.06 )%     $ 16.18      $ 13.91  

Net Asset Value

    14.75        15.19        (2.90      15.46        14.72  

Market Price and Net Asset Value History For the Past Five Years

 

LOGO

Overview of the Fund’s Total Investments*

 

SECTOR ALLOCATION

 

Sector Allocation   04/30/18     04/30/17  

Transportation

    29     26

Health

    18       18  

Utilities

    13       11  

State

    12       14  

County/City/Special District/School District

    9       12  

Corporate

    6       6  

Tobacco

    6       5  

Education

    6       7  

Housing

    1       1  

For Fund compliance purposes, the Fund’s sector classifications refer to one or more of the sector sub-classifications used by one or more widely recognized market indexes or rating group indexes, and/or as defined by the investment adviser. These definitions may not apply for purposes of this report, which may combine such sector sub-classifications for reporting ease.

CALL/MATURITY SCHEDULE (c)

 

Calendar Year Ended December 31,

       

2018

    13

2019

    21  

2020

    12  

2021

    10  

2022

    9  

 

  (c)  Scheduled maturity dates and/or bonds that are subject to potential calls by issuers over the next five years.  
  * Excludes short-term securities.  

CREDIT QUALITY ALLOCATION (a)

 

Credit Rating   04/30/18     04/30/17  

AAA/Aaa

    4     5

AA/Aa

    42       50  

A

    20       13  

BBB/Baa

    18       16  

BB/Ba

    5       4  

B

    5       2  

N/R(b)

    6       10  

 

  (a)  For financial reporting purposes, credit quality ratings shown above reflect the highest rating assigned by either S&P or Moody’s if ratings differ. These rating agencies are independent, nationally recognized statistical rating organizations and are widely used. Investment grade ratings are credit ratings of BBB/Baa or higher. Below investment grade ratings are credit ratings of BB/Ba or lower. Investments designated N/R are not rated by either rating agency. Unrated investments do not necessarily indicate low credit quality. Credit quality ratings are subject to change.  
  (b)  The investment adviser evaluates the credit quality of unrated investments based upon certain factors including, but not limited to, credit ratings for similar investments and financial analysis of sectors and individual investments. Using this approach, the investment adviser has deemed certain of these unrated securities as investment grade quality. As of April 30, 2018 and April 30, 2017, the market value of unrated securities deemed by the investment adviser to be investment grade represents 1% and 3%, respectively, of the Fund’s total investments.  
 

 

 

FUND SUMMARY      19  


Schedule of Investments  

April 30, 2018

  

BlackRock MuniAssets Fund, Inc. (MUA)

(Percentages shown are based on Net Assets)

 

Security  

Par

(000)

    Value  

Municipal Bonds — 87.8%

 

Alabama — 1.8%  

County of Jefferson Alabama Sewer, Refunding RB, Sub-Lien, Series D, 6.00%, 10/01/42

  $ 3,745     $ 4,305,365  

Lower Alabama Gas District, RB, Series A, 5.00%, 09/01/46

    1,910       2,257,276  

State of Alabama Docks Department, Refunding RB, 6.00%, 10/01/20(a)

    2,165       2,365,349  
   

 

 

 
      8,927,990  
Alaska — 1.3%  

Northern Tobacco Securitization Corp., Refunding RB, Tobacco Settlement, Asset-Backed, Series A:

   

4.63%, 06/01/23

    640       658,285  

5.00%, 06/01/32

    1,500       1,500,030  

5.00%, 06/01/46

    4,290       4,279,532  
   

 

 

 
      6,437,847  
Arizona — 2.6%  

Arizona IDA, Refunding RB, Series A(b):

   

Basis Schools, Inc. Projects, 5.13%, 07/01/37

    960       991,939  

Odyssey Preparatory Academy Project, 5.50%, 07/01/52

    1,500       1,465,980  

City of Phoenix Arizona IDA, RB:

   

Great Hearts Academies — Veritas Project, 6.40%, 07/01/21(a)

    425       480,224  

Great Hearts Academies — Veritas Projects, 6.30%, 07/01/21(a)

    500       563,450  

Legacy Traditional Schools Project, Series A, 6.50%, 07/01/34(b)

    570       628,471  

Legacy Traditional Schools Projects, Series A, 6.75%, 07/01/44(b)

    1,000       1,104,140  

City of Phoenix Arizona IDA, Refunding RB(b):

   

Basis Schools, Inc. Projects, 5.00%, 07/01/35

    305       312,729  

Basis Schools, Inc. Projects, 5.00%, 07/01/45

    855       869,877  

Basis Schools, Inc. Projects, Series A, 5.00%, 07/01/35

    260       266,588  

Basis Schools, Inc. Projects, Series A, 5.00%, 07/01/46

    290       294,869  

Legacy Traditional School Projects, 5.00%, 07/01/35

    320       328,109  

Legacy Traditional School Projects, 5.00%, 07/01/45

    255       259,279  

County of La Paz IDA, RB, Imagine Schools Desert West Middle Project, 5.88%, 06/15/48(b)

    875       873,705  

Salt Verde Financial Corp., RB, Senior, 5.00%, 12/01/37

    1,650       1,926,688  

State of Arizona IDA, RB, Academies of Math & Science Project, Series B, 5.13%, 07/01/47(b)

    665       636,365  

State of Arizona IDA, Refunding RB, Basis Schools, Inc. Projects, Series A, 5.25%, 07/01/47(b)

    1,765       1,826,440  

University Medical Center Corp., RB, 6.50%, 07/01/19(a)

    500       525,920  
   

 

 

 
      13,354,773  
California — 7.5%  

California Municipal Finance Authority, RB, Urban Discovery Academy Project(b):

   

5.50%, 08/01/34

    315       319,791  

6.00%, 08/01/44

    665       671,470  

6.13%, 08/01/49

    580       584,866  

California Municipal Finance Authority, Refunding RB, Community Medical Centers, Series A:

   

5.00%, 02/01/36

    345       379,862  

5.00%, 02/01/37

    255       280,166  

California School Finance Authority, RB:

   

Alliance for College Ready Public School - 2023 Union LLC Project, Series A, 6.40%, 07/01/48

    1,570       1,753,423  

Value Schools, 6.65%, 07/01/33

    435       487,605  

Value Schools, 6.90%, 07/01/43

    975       1,066,475  
Security  

Par

(000)

    Value  
California (continued)  

California Statewide Communities Development Authority, RB, Loma Linda University Medical Center, Series A(b):

   

5.00%, 12/01/46

  $ 725     $ 763,353  

5.25%, 12/01/56

    620       658,955  

California Statewide Communities Development Authority, Refunding RB, American Baptist Homes of the West, 6.25%, 10/01/39

    2,175       2,290,362  

California Statewide Financing Authority, RB, Asset-Backed, Tobacco Settlement, Series B, 6.00%, 05/01/43

    1,650       1,650,330  

City & County of San Francisco California Redevelopment Agency, Tax Allocation Bonds, Mission Bay South Redevelopment Project, Series D(b)(c):

   

0.00%, 08/01/26

    1,250       846,000  

0.00%, 08/01/43

    1,500       409,395  

City of San Jose California Hotel Tax, RB, Convention Center Expansion & Renovation Project:

   

6.50%, 05/01/36

    900       1,010,817  

6.50%, 05/01/42

    2,220       2,493,349  

City of Stockton California Public Financing Authority, RB, Delta Water Supply Project, Series A, 6.25%, 10/01/40

    375       436,898  

County of Los Angeles California Tobacco Securitization Agency, RB, Asset-Backed, Los Angeles County Securitization Corp.:

   

5.70%, 06/01/46

    3,600       3,609,972  

5.60%, 06/01/36

    1,285       1,299,443  

County of Riverside California Transportation Commission, RB, Senior Lien, Series A, 5.75%, 06/01/48

    2,885       3,190,291  

Golden State Tobacco Securitization Corp., Refunding RB, Asset-Backed, Senior Series A-1:

   

5.13%, 06/01/47

    3,125       3,124,906  

5.75%, 06/01/47

    3,745       3,852,556  

Tobacco Securitization Authority of Southern California, Refunding RB, Tobacco Settlement, Asset-Backed, Senior Series A-1:

   

4.75%, 06/01/25

    1,230       1,232,632  

5.00%, 06/01/37

    5,580       5,596,070  
   

 

 

 
      38,008,987  
Colorado — 1.3%  

Castle Oaks Metropolitan District No. 3, GO, 6.25%, 12/01/20(a)

    500       566,330  

Centerra Metropolitan District No. 1, Tax Allocation Bonds, 5.00%, 12/01/47(b)

    575       582,205  

Colorado Health Facilities Authority, Refunding RB, Sunny Vista Living Center Project, Series A(b):

   

6.13%, 12/01/45

    335       351,606  

6.25%, 12/01/50

    1,115       1,171,140  

Colorado International Center Metropolitan District No. 14, GOL, 5.88%, 12/01/46

    1,490       1,546,292  

Copperleaf Metropolitan District No. 2, GO, Refunding, 5.75%, 12/01/45

    720       752,746  

Regional Transportation District, RB, Denver Transit Partners Eagle P3 Project, 6.00%, 01/15/34

    1,500       1,605,435  
   

 

 

 
      6,575,754  
Connecticut — 0.9%  

Mohegan Tribal Finance Authority, RB, 7.00%, 02/01/45(b)

    1,400       1,474,004  

Mohegan Tribe of Indians of Connecticut, RB, Series A, 6.75%, 02/01/45(b)

    971       1,037,981  

Mohegan Tribe of Indians of Connecticut, Refunding RB, Public Improvement, Priority Distribution, Series C, 6.25%, 02/01/30(b)

    1,835       1,980,882  
   

 

 

 
      4,492,867  
 

 

 

20    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniAssets Fund, Inc. (MUA)

(Percentages shown are based on Net Assets)

 

Security  

Par

(000)

    Value  
Delaware — 0.9%  

County of Sussex Delaware, RB, NRG Energy, Inc., Indian River Power LLC Project, 6.00%, 10/01/40

  $ 1,000     $ 1,055,310  

State of Delaware EDA, RB, Exempt Facilities, Indian River Power LLC Project, 5.38%, 10/01/45

    3,180       3,297,692  
   

 

 

 
      4,353,002  
Florida — 8.4%  

Boggy Creek Improvement District, Refunding RB, Special Assessment Bonds, 5.13%, 05/01/43

    1,460       1,468,614  

Capital Region Community Development District, Refunding, Special Assessment, Capital Improvement Revenue Bond, Series A-1, 5.13%, 05/01/39

    1,500       1,492,365  

Capital Trust Agency, Inc., RB, Silver Creek St. Augustine Project, Series A(d)(e):

   

1st Mortgage, 8.25%, 01/01/44

    515       386,250  

1st Mortgage, 8.25%, 01/01/49

    1,105       828,750  

5.75%, 01/01/50

    655       583,539  

County of Collier Florida IDA, Refunding RB, Arlington of Naples Project, Series A, 8.13%, 05/15/44(b)

    2,510       2,807,611  

County of Miami-Dade Florida IDA, RB, Doral Academy Project, 5.00%, 01/15/48

    915       954,244  

County of Palm Beach Florida Health Facilities Authority, RB, Acts Retirement Life Community, 5.50%, 11/15/20(a)

    3,500       3,791,480  

County of Palm Beach Florida Health Facilities Authority, Refunding RB, Series A, 7.25%, 06/01/34

    500       575,040  

Florida Development Finance Corp., RB:

   

Renaissance Charter School, Series A, 5.75%, 06/15/29

    690       728,661  

Renaissance Charter School, Series A, 6.00%, 06/15/34

    835       875,765  

Renaissance Charter School, Series A, 6.13%, 06/15/44

    3,180       3,293,113  

Solid Waste Disposal Facility, Waste Pro USA, Inc. Project, AMT, 5.00%, 08/01/29(b)(f)

    1,550       1,605,614  

Greeneway Improvement District, RB, Special Assessment Bonds, 5.13%, 05/01/43

    1,820       1,834,742  

Harbor Bay Community Development District Florida, Special Assessment Bonds, Series A, 7.00%, 05/01/33

    380       381,349  

Lakewood Ranch Stewardship District Special Assessment Bonds, Village of Lakewood Ranch Sector Projects, 4.00%, 05/01/21

    105       105,972  

Lakewood Ranch Stewardship District Special Assessment Bonds, Refunding, Lakewood Center & New Sector Projects, 8.00%, 05/01/40

    1,485       1,711,997  

Lakewood Ranch Stewardship District Special Assessment Bonds, Village of Lakewood Ranch Sector Projects:

   

4.25%, 05/01/26

    145       147,014  

5.13%, 05/01/46

    860       886,445  

Mid-Bay Florida Bridge Authority, RB, Springing Lien, Series A, 7.25%, 10/01/21(a)

    4,550       5,282,049  

Midtown Miami Community Development District, Refunding, Special Assessment Bonds:

   

Series A, 5.00%, 05/01/37

    845       884,960  

Series B, 5.00%, 05/01/37

    495       518,409  

Santa Rosa Bay Bridge Authority, RB, 6.25%, 07/01/28(d)(e)

    3,947       2,921,085  

Tampa Palms Open Space and Transportation Community Development District, RB, Capital Improvement, Richmond Place Project, 7.50%, 05/01/18

    295       295,000  

Tolomato Community Development District, Refunding, Special Assessment Bonds(g):

   

Convertible CAB, Series A3, 6.61%, 05/01/40

    585       553,492  

Convertible CAB, Series A4, 6.61%, 05/01/40

    305       241,935  

Series 2015-2, 6.61%, 05/01/40

    805       527,492  

Tolomato Community Development District:

   

Series 1, 6.61%, 05/01/40(g)

    1,305       1,039,354  

Series 1, 6.65%, 05/01/40(d)(e)

    50       48,322  

Series 3, 6.61%, 05/01/40(d)(e)

    875       9  

Series 3, 6.65%, 05/01/40(d)(e)

    710       7  
Security  

Par

(000)

    Value  
Florida (continued)  

Village Community Development District No. 9, Special Assessment Bonds:

   

6.75%, 05/01/31

  $ 1,500     $ 1,672,410  

7.00%, 05/01/41

    2,460       2,810,698  

5.50%, 05/01/42

    1,165       1,254,367  
   

 

 

 
      42,508,154  
Georgia — 1.1%  

County of Clayton Georgia Development Authority, Refunding RB, Delta Air Lines, Inc. Project, Series A, 8.75%, 06/01/29

    3,365       3,773,343  

County of Gainesville & Hall Georgia Development Authority, Refunding RB, Acts Retirement Life Community, Series A-2(a):

   

6.38%, 11/15/19

    700       746,536  

6.63%, 11/15/19

    880       941,116  
   

 

 

 
      5,460,995  
Guam — 0.3%  

Territory of Guam, GO, Series A:

   

6.00%, 11/15/19

    270       277,149  

7.00%, 11/15/19(a)

    1,115       1,198,380  
   

 

 

 
      1,475,529  
Illinois — 5.8%  

Chicago Board of Education, GO, Dedicated Revenues:

   

Series H, 5.00%, 12/01/46

    720       706,010  

Refunding Series D, 5.00%, 12/01/27

    900       929,718  

Refunding Series D, 5.00%, 12/01/31

    1,000       1,007,530  

Refunding Series F, 5.00%, 12/01/22

    675       711,936  

Refunding Series G, 5.00%, 12/01/44

    2,150       2,118,803  

City of Chicago Illinois, GO, Refunding, Series A, 6.00%, 01/01/38

    1,260       1,392,376  

Illinois Finance Authority, Refunding RB:

   

Friendship Village of Schaumburg, 7.25%, 02/15/20(a)

    4,000       4,362,800  

Lutheran Home & Services Obligated Group, 5.63%, 05/15/42

    2,395       2,505,074  

Presence Health Network, Series C, 4.00%, 02/15/41

    1,500       1,484,430  

Primary Health Care Centers Program, 6.60%, 07/01/24

    890       884,571  

Rogers Park Montessori School Project, Series 2014, 6.00%, 02/01/34

    365       381,524  

Rogers Park Montessori School Project, Series 2014, 6.13%, 02/01/45

    860       897,264  

Roosevelt University Project, 6.50%, 04/01/44

    2,000       2,089,320  

Metropolitan Pier & Exposition Authority, RB, Series A, McCormick Place Expansion Project:

   

Bonds, 0.00%, 12/15/56(c)

    5,005       639,339  

5.50%, 06/15/53

    2,370       2,513,480  

Metropolitan Pier & Exposition Authority, Refunding RB, McCormick Place Expansion Project Bonds, Series B, 0.00%, 12/15/54(c)

    6,980       998,978  

Railsplitter Tobacco Settlement Authority, RB(a):

   

5.50%, 06/01/21

    180       197,991  

6.00%, 06/01/21

    710       791,494  

State of Illinois, GO:

   

5.25%, 02/01/29

    1,000       1,032,430  

Series A, 5.00%, 01/01/33

    740       748,088  

Series D, 5.00%, 11/01/28

    1,365       1,415,136  

Village of Lincolnshire Illinois, Special Tax Bonds, Sedgebrook Project, 6.25%, 03/01/34

    1,659       1,662,268  
   

 

 

 
      29,470,560  
Indiana — 2.5%  

City of Valparaiso Indiana, RB, Exempt Facilities, Pratt Paper LLC Project, AMT:

   

6.75%, 01/01/34

    825       963,014  

7.00%, 01/01/44

    2,000       2,346,600  
 

 

 

SCHEDULES OF INVESTMENTS      21  


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniAssets Fund, Inc. (MUA)

(Percentages shown are based on Net Assets)

 

Security  

Par

(000)

    Value  
Indiana (continued)  

City of Vincennes Indiana, Refunding RB, Southwest Indiana Regional Youth Village Project, 6.25%, 01/01/29(b)

  $ 2,315     $ 2,302,314  

County of Allen Indiana, RB, StoryPoint Fort Wayne Project, Series A-1(b):

   

6.63%, 01/15/34

    290       308,580  

6.75%, 01/15/43

    525       557,912  

6.88%, 01/15/52

    2,450       2,608,785  

Indiana Finance Authority, RB, Private Activity Bond, Ohio River Bridges East End Crossing Project, Series A, AMT:

   

5.00%, 07/01/44

    470       500,503  

5.00%, 07/01/48

    1,555       1,651,410  

Town of Chesterton Indiana, RB, StoryPoint Chesterton Project, Series A-1, 6.38%, 01/15/51(b)

    1,190       1,227,092  
   

 

 

 
      12,466,210  
Iowa — 2.7%  

Iowa Finance Authority, Refunding RB:

   

Iowa Fertilizer Co. Project, Series B, 5.25%, 12/01/50(f)

    2,085       2,189,896  

Midwestern Disaster Area, Iowa Fertilizer Co. Project, 5.50%, 12/01/22

    5       5,073  

Midwestern Disaster Area, Iowa Fertilizer Co. Project, 5.25%, 12/01/25

    2,190       2,330,138  

Sunrise Retirement Community Project, 5.50%, 09/01/37

    1,355       1,371,518  

Sunrise Retirement Community Project, 5.75%, 09/01/43

    2,115       2,156,137  

Iowa Tobacco Settlement Authority, Refunding RB:

   

Asset-Backed, CAB, Series B, 5.60%, 06/01/34

    795       803,196  

Series C, 5.38%, 06/01/38

    4,900       4,911,907  
   

 

 

 
      13,767,865  
Kentucky — 0.9%  

Kentucky Public Transportation Infrastructure Authority, RB, Downtown Crossing, First Tier, Series A, 5.75%, 07/01/49

    4,000       4,376,120  
   

 

 

 
Louisiana — 2.1%  

Juban Crossing Economic Development District, Refunding RB, General Infrastructure Project, Series C, 7.00%, 09/15/44(b)

    2,460       2,548,240  

Louisiana Public Facilities Authority, RB, Belle Chasse Educational Foundation Project, 6.75%, 05/01/41

    1,745       1,854,953  

Tobacco Settlement Financing Corp., Refunding RB, Asset-Backed, Series A, 5.25%, 05/15/35

    5,570       6,024,456  
   

 

 

 
      10,427,649  
Maine — 0.6%  

Maine Health & Higher Educational Facilities Authority, RB, Maine General Medical Center, 6.75%, 07/01/41

    2,955       3,193,143  
   

 

 

 
Maryland — 2.6%  

County of Frederick Maryland, RB, Jefferson Technology Park Project, Series B, 7.13%, 07/01/43(b)

    2,840       3,052,631  

Maryland EDC, RB:

   

Purple Line Light Rail Project, AMT, 5.00%, 03/31/51

    2,185       2,370,550  

Transportation Facilities Project, Series A, 5.75%, 06/01/20(a)

    3,615       3,887,535  

Maryland EDC, Refunding RB:

   

CNX Marine Terminals, Inc., 5.75%, 09/01/25

    3,085       3,218,488  

Transportation Facilities Project, Series A, 5.00%, 06/01/35

    415       462,256  
   

 

 

 
      12,991,460  
Massachusetts — 1.0%  

Massachusetts Development Finance Agency, RB, Series A(a):

   

Foxborough Regional Charter School, 7.00%, 07/01/20

    1,025       1,131,128  

North Hill Communities Issue, 6.50%, 11/15/23(b)

    2,020       2,442,261  
Security  

Par

(000)

    Value  
Massachusetts (continued)  

Massachusetts Development Finance Agency, Refunding RB, Tufts Medical Center, Series I:

   

6.75%, 01/01/21(a)

  $ 895     $ 998,041  

6.75%, 01/01/36

    595       663,342  
   

 

 

 
      5,234,772  
Michigan — 0.9%  

City of Detroit Michigan Sewage Disposal System, Refunding RB, Senior Lien, Series A, 5.25%, 07/01/39

    2,785       2,977,750  

Michigan Finance Authority, RB, Detroit Water & Sewage Disposal System, Senior Lien, Series 2014 C-2, AMT, 5.00%, 07/01/44

    415       442,386  

Michigan Finance Authority, Refunding RB, Detroit Water & Sewage Department Project, Senior Lien, Series C-1, 5.00%, 07/01/44

    920       994,851  
   

 

 

 
      4,414,987  
Minnesota — 0.1%  

St. Paul Housing & Redevelopment Authority, Refunding RB, Hmong College Prep Academy Project, Series A:

   

5.75%, 09/01/46

    195       205,257  

6.00%, 09/01/51

    290       308,116  
   

 

 

 
      513,373  
Missouri — 1.0%  

City of St. Louis Missouri IDA, Refunding RB, BallPark Village Development Project, Series A:

   

4.38%, 11/15/35

    685       695,480  

4.75%, 11/15/47

    760       772,791  

Kirkwood Missouri IDA, RB, Aberdeen Heights, Series A, 8.25%, 05/15/20(a)

    2,315       2,594,328  

Lees Summit Missouri IDA, RB, John Knox Obligated Group, 5.25%, 08/15/39

    1,000       1,040,600  
   

 

 

 
      5,103,199  
New Jersey — 3.5%  

Casino Reinvestment Development Authority, Refunding RB:

   

5.25%, 11/01/39

    1,065       1,128,399  

5.25%, 11/01/44

    770       816,008  

County of Essex New Jersey Improvement Authority, RB, AMT, 5.25%, 07/01/45(b)

    1,150       1,160,672  

New Jersey EDA, RB:

   

Goethals Bridge Replacement Project, AMT, Private Activity Bond, 5.38%, 01/01/43

    2,155       2,348,153  

Kapkowski Road Landfill Project, Series B, AMT, 6.50%, 04/01/31

    2,250       2,557,778  

Provident Group-Kean Properties, Series A, 5.00%, 07/01/32

    165       178,985  

Provident Group-Kean Properties, Series A, 5.00%, 07/01/37

    260       278,080  

Team Academy Charter School Project, 6.00%, 10/01/43

    1,530       1,681,470  

New Jersey EDA, Refunding RB, Greater Brunswick Charter School, Inc. Project, Series A, 6.00%, 08/01/49(b)

    500       505,385  

New Jersey Health Care Facilities Financing Authority, Refunding RB(a):

   

St. Barnabas Health Care System, Series A, 5.63%, 07/01/21

    2,650       2,923,268  

St. Joseph’s Healthcare System, 6.63%, 07/01/18

    1,590       1,602,211  

New Jersey Transportation Trust Fund Authority, RB, Transportation Program, Series AA, 5.25%, 06/15/41

    1,140       1,214,396  

Tobacco Settlement Financing Corp., Refunding RB, Sub-Series B, 5.00%, 06/01/46

    830       870,853  

Tobacco Settlement Financing Corp. New Jersey, Refunding RB, Series A, 5.25%, 06/01/46

    590       655,272  
   

 

 

 
      17,920,930  
 

 

 

22    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniAssets Fund, Inc. (MUA)

(Percentages shown are based on Net Assets)

 

Security  

Par

(000)

    Value  
New Mexico — 0.6%  

New Mexico Hospital Equipment Loan Council, Refunding RB, Gerald Champion Regional Medical Center Project, 5.50%, 07/01/42

  $ 2,970     $ 3,161,417  
   

 

 

 
New York — 7.5%  

Counties of New York Tobacco Trust IV, Refunding RB, Settlement Pass-Through Turbo, Series A:

   

6.25%, 06/01/41(b)

    5,300       5,519,420  

5.00%, 06/01/42

    3,155       3,107,107  

5.00%, 06/01/45

    1,185       1,154,083  

Counties of New York Tobacco Trust VI, Refunding RB, Tobacco Settlement Pass-Through:

   

Series A-2B, 5.00%, 06/01/51

    1,900       1,972,827  

Series B, 5.00%, 06/01/45

    2,655       2,817,858  

County of Dutchess New York Industrial Development Agency, Refunding RB, Bard College Civic Facility, Series A-1, 5.00%, 08/01/46

    3,315       3,137,449  

County of Westchester New York Healthcare Corp., RB, Senior Lien, Series A, 5.00%, 11/01/44

    1,310       1,389,460  

Erie Tobacco Asset Securitization Corp., Refunding RB, Asset-Backed, Series A, 5.00%, 06/01/45

    2,890       2,826,940  

Metropolitan Transportation Authority, RB, Series C:

   

6.50%, 11/15/18(a)

    125       128,146  

6.50%, 11/15/18(a)

    1,490       1,527,503  

6.50%, 11/15/28

    385       394,837  

New York Liberty Development Corp., Refunding RB:

   

2nd Priority, Bank of America Tower at One Bryant Park Project, Class 3, 6.38%, 07/15/49

    1,270       1,343,393  

3 World Trade Center Project, Class 1, 5.00%, 11/15/44(b)

    4,705       4,942,791  

3 World Trade Center Project, Class 2, 5.15%, 11/15/34(b)

    455       495,063  

3 World Trade Center Project, Class 2, 5.38%, 11/15/40(b)

    1,080       1,176,314  

3 World Trade Center Project, Class 3, 7.25%, 11/15/44(b)

    1,565       1,856,951  

Niagara Area Development Corp., Refunding RB, Solid Waste Disposal Facility, Covanta Energy Project, Series A, AMT, 5.25%, 11/01/42(b)

    1,335       1,335,801  

Port Authority of New York & New Jersey, ARB, Special Project, JFK International Air Terminal LLC Project, Series 8, 6.00%, 12/01/36

    1,340       1,467,394  

State of New York Dormitory Authority, Refunding RB, Orange Regional Medical Center, 5.00%, 12/01/33(b)

    955       1,035,411  
   

 

 

 
      37,628,748  
North Carolina — 1.5%  

North Carolina Medical Care Commission, Refunding RB, 1st Mortgage, Series A(a):

   

Deerfield Project, 6.13%, 11/01/18

    4,565       4,662,965  

Retirement Facilities Whitestone Project, 7.75%, 03/01/21

    1,000       1,149,370  

Retirement Facilities Whitestone Project, 7.75%, 03/01/21

    1,420       1,632,105  
   

 

 

 
      7,444,440  
Ohio — 3.2%  

Buckeye Tobacco Settlement Financing Authority, RB, Asset-Backed, Series A-2:

   

Senior Turbo Term, 5.75%, 06/01/34

    6,745       6,684,632  

Senior Turbo Term, 5.88%, 06/01/47

    5,570       5,569,944  

6.00%, 06/01/42

    3,040       3,032,522  

County of Hamilton Ohio, Refunding RB, Improvement-Life Enriching Communities, 5.00%, 01/01/46

    875       927,474  
   

 

 

 
      16,214,572  
Security  

Par

(000)

    Value  
Oklahoma — 1.4%  

County of Tulsa Oklahoma Industrial Authority, Refunding RB, Montereau, Inc. Project, 5.25%, 11/15/37

  $ 750     $ 826,763  

Oklahoma Development Finance Authority, RB, OU Medicine Project, Series B:

   

5.00%, 08/15/38

    2,990       3,253,090  

5.25%, 08/15/43

    2,690       2,961,582  
   

 

 

 
      7,041,435  
Oregon — 0.8%  

County of Multnomah Oregon Hospital Facilities Authority, Refunding RB, Mirabella at South Waterfront, 5.50%, 10/01/49

    1,765       1,881,543  

Polk County Hospital Facility Authority, RB, Dallas Retirement Village Project, Series A:

   

5.13%, 07/01/35

    620       642,698  

5.38%, 07/01/45

    1,435       1,498,571  
   

 

 

 
      4,022,812  
Pennsylvania — 4.0%  

Allentown Neighborhood Improvement Zone Development Authority, Refunding RB, Series A, 5.00%, 05/01/42

    2,140       2,215,135  

City of Philadelphia Pennsylvania Hospitals & Higher Education Facilities Authority, RB, Temple University Health System, Series A, 5.63%, 07/01/36

    2,000       2,172,940  

Commonwealth Financing Authority, RB, Tobacco Master Settlement Payment:

   

5.00%, 06/01/33

    115       128,610  

5.00%, 06/01/34

    150       166,679  

County of Cumberland Pennsylvania Municipal Authority, Refunding RB, Diakon Lutheran:

   

6.38%, 01/01/19(a)

    5,550       5,715,168  

6.38%, 01/01/39

    615       629,084  

County of Lehigh Pennsylvania General Purpose Authority, Refunding RB, Bible Fellowship Church Homes, 5.13%, 07/01/32

    1,800       1,822,392  

County of Montgomery Higher Education & Health Authority, Refunding RB, Thomas Jefferson University, Series A, 5.00%, 09/01/43

    1,365       1,516,105  

County of Northampton Pennsylvania IDA, Route 33 Project, Tax Allocation Bonds, 7.00%, 07/01/32

    2,030       2,317,549  

Montgomery County Higher Education & Health Authority, Refunding RB, Thomas Jefferson University, Series A, 4.00%, 09/01/49

    620       610,167  

Pennsylvania Economic Development Financing Authority, Refunding RB, National Gypsum Co., AMT, 5.50%, 11/01/44

    2,710       2,848,752  
   

 

 

 
      20,142,581  
Puerto Rico — 1.1%  

Children’s Trust Fund, Refunding RB, Tobacco Settlement Asset-Backed Bonds:

   

5.50%, 05/15/39

    635       619,531  

5.63%, 05/15/43

    2,145       2,051,285  

Commonwealth of Puerto Rico, GO, Refunding, Series A(d)(e):

   

Public Improvement, 5.50%, 07/01/39

    665       286,781  

8.00%, 07/01/35

    1,765       745,713  

Commonwealth of Puerto Rico, GO, , 6.00%, 07/01/38(d)(e)

    750       338,438  

Commonwealth of Puerto Rico Aqueduct & Sewer Authority, RB, Senior Lien, Series A, 6.00%, 07/01/44

    850       692,750  

Commonwealth of Puerto Rico Aqueduct & Sewer Authority, Refunding RB, Senior Lien, Series A, 6.00%, 07/01/38

    990       806,850  
   

 

 

 
      5,541,348  
Rhode Island — 2.3%  

Central Falls Detention Facility Corp., Refunding RB, 7.25%, 07/15/35(d)(e)

    4,190       754,200  
 

 

 

SCHEDULES OF INVESTMENTS      23  


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniAssets Fund, Inc. (MUA)

(Percentages shown are based on Net Assets)

 

Security  

Par

(000)

    Value  
Rhode Island (continued)  

Tobacco Settlement Financing Corp., Refunding RB:

   

Series A, 5.00%, 06/01/35

  $ 1,000     $ 1,075,140  

Series A, 5.00%, 06/01/40

    980       1,039,878  

Series B, 4.50%, 06/01/45

    5,055       5,106,763  

Series B, 5.00%, 06/01/50

    3,330       3,411,619  
   

 

 

 
      11,387,600  
Tennessee — 0.4%  

County of Memphis-Shelby Tennessee Industrial Development Board, Refunding, Tax Allocation Bonds, Senior Tax Increment, Graceland Project, Series A:

   

5.50%, 07/01/37

    925       982,350  

5.63%, 01/01/46

    1,085       1,148,190  
   

 

 

 
      2,130,540  
Texas — 9.9%  

Central Texas Regional Mobility Authority, Refunding RB:

   

CAB, 0.00%, 01/01/28(c)

    1,000       699,010  

CAB, 0.00%, 01/01/29(c)

    2,000       1,333,140  

CAB, 0.00%, 01/01/30(c)

    1,170       743,090  

CAB, 0.00%, 01/01/33(c)

    3,690       2,017,544  

CAB, 0.00%, 01/01/34(c)

    4,000       2,079,560  

Senior Lien, 6.25%, 01/01/21(a)

    2,210       2,439,067  

City of Houston Texas Airport System, Refunding ARB, AMT:

   

Special Facilities, Continental Airlines, Inc., Series A, 6.63%, 07/15/38

    2,890       3,172,237  

United Airlines, Inc. Terminal E Project, 5.00%, 07/01/29

    910       984,420  

Clifton Higher Education Finance Corp., ERB, Idea Public Schools(a):

   

5.50%, 08/15/31

    955       1,053,069  

5.75%, 08/15/41

    720       799,603  

County of Bexar Texas Health Facilities Development Corp., RB, Army Retirement Residence Project, 6.20%, 07/01/20(a)

    5,040       5,471,374  

County of Harris Texas Cultural Education Facilities Finance Corp., RB, 1st Mortgage, Brazos Presbyterian Homes, Inc. Project, Series B, 7.00%, 01/01/23(a)

    475       570,613  

County of Matagorda Texas Navigation District No. 1, Refunding RB, Central Power & Light Co., Project, Series A, 6.30%, 11/01/29

    2,090       2,232,392  

County of Tarrant Texas Cultural Education Facilities Finance Corp., RB, Senior Living Center Project, Series A, 8.25%, 11/15/44

    4,200       3,685,836  

County of Tarrant Texas Cultural Education Facilities Finance Corp., Refunding RB, Trinity Terrace Project, 5.00%, 10/01/49

    865       907,991  

County of Travis Texas Health Facilities Development Corp., Refunding RB, 7.13%, 01/01/46(a)

    3,080       3,472,823  

Mesquite Health Facility Development Corp., Refunding RB, 5.13%, 02/15/42

    810       833,401  

Mission Texas Economic Development Corp., RB, Senior Lien, Natural Gasoline Project, Series B, AMT, 5.75%, 10/01/31(b)

    1,325       1,375,403  

New Hope Cultural Education Facilities Corp., RB, Stephenville LLC Tarleton State University Project:

   

5.88%, 04/01/36

    1,210       1,340,970  

6.00%, 04/01/45

    1,845       2,008,928  

Newark Higher Education Finance Corp., RB, Series A(b):

   

5.50%, 08/15/35

    290       299,634  

5.75%, 08/15/45

    580       602,295  

North Texas Education Finance Corp., ERB, Uplift Education, Series A, 5.25%, 12/01/47

    1,600       1,672,112  
Security  

Par

(000)

    Value  
Texas (continued)  

Red River Health Facilities Development Corp., First MRB, Project:

   

Eden Home, Inc., 7.25%, 12/15/42(d)(e)

  $ 2,895     $ 1,679,100  

Wichita Falls Retirement Foundation, 5.13%, 01/01/41

    900       923,337  

Texas Private Activity Bond Surface Transportation Corp., RB, Senior Lien:

   

LBJ Infrastructure Group LLC, 7.00%, 06/30/40

    3,775       4,142,609  

NTE Mobility Partners LLC, North Tarrant Express Managed Lanes Project, 6.88%, 12/31/39

    3,000       3,225,240  
   

 

 

 
      49,764,798  
Utah — 0.6%  

State of Utah Charter School Finance Authority, Refunding RB, 6.75%, 10/15/43

    2,950       2,968,438  
   

 

 

 
Vermont — 0.2%  

Vermont EDA, Refunding, MRB, Wake Robin Corp. Project, 5.40%, 05/01/33

    770       815,877  
   

 

 

 
Virginia — 2.3%  

Lower Magnolia Green Community Development Authority, Special Assessment Bonds(b):

   

5.00%, 03/01/35

    495       502,692  

5.00%, 03/01/45

    505       508,449  

Mosaic District Community Development Authority, Special Assessment, Series A:

   

6.63%, 03/01/26

    1,485       1,610,602  

6.88%, 03/01/36

    1,300       1,414,985  

Tobacco Settlement Financing Corp., Refunding RB, Senior Series B-1, 5.00%, 06/01/47

    2,280       2,246,963  

Virginia College Building Authority, RB, Marymount University Project, Series B, 5.00%, 07/01/45(b)

    535       559,867  

Virginia Small Business Financing Authority, RB, Senior Lien, Elizabeth River Crossings OpCo LLC Project, AMT, 6.00%, 01/01/37

    4,440       4,940,965  
   

 

 

 
      11,784,523  
Washington — 0.8%  

County of King Washington Public Hospital District No. 4, GO, Refunding, Snoqualmie Valley Hospital, 7.00%, 12/01/40

    1,455       1,501,167  

Greater Wenatchee Regional Events Center Public Facilities District, Refunding RB, Series A, 5.50%, 09/01/42

    1,495       1,523,674  

Washington State Housing Finance Commission, Refunding RB(b):

   

5.75%, 01/01/35

    315       317,397  

6.00%, 01/01/45

    850       858,738  
   

 

 

 
      4,200,976  
Wisconsin — 1.4%  

Public Finance Authority, RB:

   

Alabama Proton Therapy Center, Series A, 6.25%, 10/01/31(b)

    605       588,393  

Alabama Proton Therapy Center, Series A, 7.00%, 10/01/47(b)

    605       609,919  

Delray Beach Radiation Therapy, 6.85%, 11/01/46(b)

    900       922,680  

Delray Beach Radiation Therapy, 7.00%, 11/01/46(b)

    570       589,887  

Series A, 5.00%, 12/01/45

    1,505       1,571,491  

Series A, 5.15%, 12/01/50

    1,170       1,225,236  

Wisconsin Health & Educational Facilities Authority, Refunding RB:

   

Benevolent Corporation Cedar Community, 5.00%, 06/01/41

    225       232,738  

St. Johns Communities, Inc., Series A, 7.25%, 09/15/19(a)

    425       455,039  
 

 

 

24    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniAssets Fund, Inc. (MUA)

(Percentages shown are based on Net Assets)

 

Security  

Par

(000)

    Value  
Wisconsin (continued)  

St. Johns Communities, Inc., Series A, 7.63%, 09/15/19(a)

  $ 855     $ 919,740  
   

 

 

 
      7,115,123  
   

 

 

 

Total Municipal Bonds — 87.8%
(Cost — $419,424,533)

 

    442,841,394  
   

 

 

 

Municipal Bonds Transferred to Tender Option Bond Trusts(h)

 

Colorado — 2.4%  

Colorado Health Facilities Authority, Refunding RB, Sisters of Leavenworth Health System, Series A, 5.00%, 01/01/40

    11,468       11,932,401  
   

 

 

 
Florida — 3.0%  

County of Miami-Dade Florida Aviation Revenue, Refunding ARB, Miami International, Series A, AGC(a):

   

5.25%, 10/01/18

    11,655       11,810,303  

5.25%, 10/01/18

    3,345       3,389,572  
   

 

 

 
      15,199,875  
Illinois — 2.7%  

Illinois Finance Authority, RB, The Carle Foundation, Series A (AGM), 6.00%, 08/15/41

    7,180       7,925,069  

State of Illinois Toll Highway Authority, RB, Series A, 5.00%, 01/01/40

    5,056       5,569,395  
   

 

 

 
      13,494,464  
Massachusetts — 0.5%  

Commonwealth of Massachusetts Transportation Fund Revenue, RB, Rail Enhancement Program, Series A, 4.00%, 06/01/45

    2,268       2,315,284  
   

 

 

 
New York — 13.1%  

City of New York New York Housing Development Corp., RB, M/F Housing, Series D-1, Class B, 4.25%, 11/01/45

    8,996       9,177,600  

City of New York New York Water & Sewer System, Refunding RB, 2nd General Resolution:

   

Fiscal 2013, Series CC, 5.00%, 06/15/47

    14,181       15,562,518  

Series HH, 5.00%, 06/15/31(i)

    8,610       9,309,763  

Hudson Yards Infrastructure Corp., RB, Fiscal 2012, Series A, 5.75%, 02/15/47(i)

    4,520       4,933,363  

New York Liberty Development Corp., ARB, 1 World Trade Center Port Authority Consolidated Bonds, 5.25%, 12/15/43

    18,104       19,724,529  

New York Liberty Development Corp., Refunding RB, 4 World Trade Center Project, 5.75%, 11/15/51(i)

    6,600       7,303,260  
   

 

 

 
      66,011,033  
Pennsylvania — 0.6%  

Pennsylvania Turnpike Commission, RB, Sub-Series A, 5.50%, 12/01/42

    2,505       2,852,627  
   

 

 

 
Rhode Island — 0.3%  

Narragansett Bay Commission, Refunding RB, Wastewater System, Series A, 4.00%, 09/01/43

    1,710       1,727,373  
   

 

 

 
Security  

Par

(000)

    Value  
Texas — 0.4%  

Lower Colorado River Authority, Refunding RB, LCRA Transmission Services Corporation Project, 4.00%, 05/15/43

  $ 2,271     $ 2,283,246  
   

 

 

 
Washington — 1.7%  

City of Bellingham Washington Water & Sewer Revenue, RB, Water & Sewer, 5.00%, 08/01/40

    7,966       8,573,401  
   

 

 

 

Total Municipal Bonds Transferred to Tender Option Bond Trusts — 24.7%
(Cost — $119,626,522)

 

    124,389,704  
   

 

 

 

Total Long-Term Investments — 112.5%
(Cost — $539,051,055)

 

    567,231,098  
   

 

 

 
     Shares         
Short-Term Securities — 0.4%  

BlackRock Liquidity Funds, MuniCash, Institutional Class,
1.48%(j)(k)

    2,226,571       2,226,571  
   

 

 

 

Total Short-Term Securities — 0.4%
(Cost — $2,226,571)

 

    2,226,571  
   

 

 

 

Total Investments — 112.9%
(Cost — $541,277,626)

 

    569,457,669  

Other Assets Less Liabilities — 1.4%

 

    7,245,844  

Liability for TOB Trust Certificates, Including Interest Expense and Fees Payable — (14.3)%

 

    (72,233,065
   

 

 

 

Net Assets Applicable to Common Shares — 100.0%

 

  $ 504,470,448  
   

 

 

 

 

(a)  U.S. Government securities, held in escrow, are used to pay interest on this security, as well as to retire the bond in full at the date indicated, typically at a premium to par.
(b)  Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors.
(c)  Zero-coupon bond.
(d)  Non-income producing security.
(e)  Issuer filed for bankruptcy and/or is in default.
(f)  Variable or floating rate security, which interest rate adjusts periodically based on changes in current interest rates and prepayments on the underlying pool of assets. Rate shown is the rate in effect as of period end.
(g)  Step-up bond that pays an initial coupon rate for the first period and then a higher coupon rate for the following periods. Rate as of period end.
(h)  Represent bonds transferred to a TOB Trust in exchange of cash and residual certificates received by the Fund. These bonds serve as collateral in a secured borrowing. See Note 4 of the Notes to Financial Statements for details.
(i)  All or a portion of security is subject to a recourse agreement. The aggregate maximum potential amount the Fund could ultimately be required to pay under the agreements, which expire between February 15, 2019 to November 15, 2019, is $11,849,809. See Note 4 of the Notes to Financial Statements for details.
(j)  Annualized 7-day yield as of period end.
 
(k)  During the year ended April 30, 2018, investments in issuers considered to be an affiliate of the Fund for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliated    Shares
Held at
04/30/17
     Net
Activity
    

Shares

Held at
04/30/18

     Value at
04/30/18
     Income      Net
Realized
Gain (Loss)
 (a)
     Change in
Unrealized
Appreciation
(Depreciation)
 

BlackRock Liquidity Funds, MuniCash, Institutional Class

     1,057,065        1,169,506        2,226,571      $ 2,226,571      $ 24,826      $ 260      $ (96
           

 

 

    

 

 

    

 

 

    

 

 

 

 

  (a)  Includes net capital gain distributions, if applicable.  

 

 

SCHEDULES OF INVESTMENTS      25  


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniAssets Fund, Inc. (MUA)

 

Derivative Financial Instruments Outstanding as of Period End

Futures Contracts

 

Description    Number of
Contracts
       Expiration
Date
       Notional
Amount (000)
       Value/
Unrealized
Appreciation
(Depreciation)
 

Short Contracts:

 

10-Year U.S. Treasury Note

     29          06/20/18        $ 3,469        $ 18,732  

Long U.S. Treasury Bond

     53          06/20/18          7,624          8,839  

5-Year U.S. Treasury Note

     23          06/29/18          2,611          12,011  
                 

 

 

 
        $ 39,582  
                 

 

 

 

Derivative Financial Instruments Categorized by Risk Exposure

As of year end, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:

 

      Commodity
Contracts
     Credit
Contracts
     Equity
Contracts
     Foreign
Currency
Exchange
Contracts
     Interest
Rate
Contracts
     Other
Contracts
     Total  

Assets — Derivative Financial Instruments

                    

Futures contracts

                    

Net unrealized appreciation(a)

   $      $      $      $      $ 39,582      $      $ 39,582  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

  (a)  Includes cumulative appreciation (depreciation) on futures contracts if any, as reported in the Schedule of Investments. Only current day’s variation margin is reported within the Statements of Assets and Liabilities.  

For the year ended April 30, 2018, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

      Commodity
Contracts
     Credit
Contracts
     Equity
Contracts
     Foreign
Currency
Exchange
Contracts
     Interest
Rate
Contracts
     Other
Contracts
     Total  

Net Realized Gain (Loss) from:

                    

Futures contracts

   $      $      $      $      $ 613,477      $      $ 613,477  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net Change in Unrealized Appreciation (Depreciation) on:

                    

Futures contracts

   $      $      $      $      $ 279,076      $      $ 279,076  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

Futures contracts:

 

Average notional value of contracts — short

   $ 20,009,572  

For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements

Fair Value Hierarchy as of Period End

Various inputs are used in determining the fair value of investments and derivative financial instruments. For information about the Fund’s policy regarding valuation of investments and derivative financial instruments, refer to the Notes to Financial Statements.

The following tables summarize the Fund’s investments and derivative financial instruments categorized in the disclosure hierarchy:

 

      Level 1        Level 2        Level 3        Total  

Assets:

 

Investments:

 

Long-Term Investments(a)

   $        $ 567,231,098        $        $ 567,231,098  

Short-Term Securities

     2,226,571                            2,226,571  
  

 

 

      

 

 

      

 

 

      

 

 

 
   $ 2,226,571        $ 567,231,098        $               —        $ 569,457,669  
  

 

 

      

 

 

      

 

 

      

 

 

 

 

 

26    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniAssets Fund, Inc. (MUA)

 

      Level 1        Level 2        Level 3        Total  

Derivative Financial Instruments(b)

 

Assets:

 

Interest rate contracts

   $ 39,582        $        $        $ 39,582  
  

 

 

      

 

 

      

 

 

      

 

 

 

 

  (a)  See above Schedule of Investments for values in each state or political subdivision.  
  (b)  Derivative financial instruments are futures contracts which are valued at the unrealized appreciation (depreciation) on the instrument.  

The Fund may hold assets and/or liabilities in which the fair value approximates the carrying amount for financial statement purposes. As of period end, TOB Trust Certificates of $71,924,984 are categorized as Level 2 within the disclosure hierarchy.

During the year ended April 30, 2018, there were no transfers between levels.

See notes to financial statements.

 

 

SCHEDULES OF INVESTMENTS      27  


Schedule of Investments  

April 30, 2018

  

BlackRock MuniEnhanced Fund, Inc. (MEN)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  

Municipal Bonds — 124.9%

 

Alabama — 0.6%  

County of Tuscaloosa Board of Education, RB, Special Tax School Warrants, 5.00%, 02/01/43

  $ 885     $ 989,899  

Homewood Educational Building Authority, Refunding RB, Educational Facilities, Samford University, Series A,
5.00%, 12/01/47

    1,010       1,104,748  
   

 

 

 
      2,094,647  
Alaska — 0.7%  

Alaska Industrial Development & Export Authority, RB, Providence Health Services, Series A, 5.50%, 10/01/41

    990       1,071,051  

Borough of Matanuska-Susitna Alaska, RB, Goose Creek Correctional Center (AGC)(a):

   

6.00%, 09/01/19

    765       806,096  

6.00%, 09/01/19

    435       458,368  
   

 

 

 
      2,335,515  
Arizona — 2.1%  

County of Maricopa Arizona IDA, Refunding RB, Banner Health Obligation Group, Series A, 4.00%, 01/01/41

    3,940       4,019,076  

State of Arizona, COP, Department of Administration, Series A (AGM):

   

5.00%, 10/01/27

    2,700       2,807,703  

5.00%, 10/01/29

    400       415,900  
   

 

 

 
      7,242,679  
California — 14.3%  

Anaheim California Public Financing Authority, RB, Senior, Public Improvements Project, Series A (AGM), 6.00%, 09/01/24

    5,000       5,766,950  

California Health Facilities Financing Authority, RB:

   

St. Joseph Health System, Series A, 5.75%, 07/01/39

    550       574,376  

Sutter Health, Series A, 4.00%, 11/15/42

    230       233,464  

Sutter Health, Series B, 5.88%, 08/15/20(a)

    1,200       1,307,028  

California Health Facilities Financing Authority, Refunding RB, St. Joseph Health System, Series A, 5.00%, 07/01/37

    1,090       1,208,941  

California Statewide Communities Development Authority, RB, Kaiser Permanente, Series A, 5.00%, 04/01/42

    1,480       1,604,453  

City & County of San Francisco California Airports Commission, Refunding ARB, Series A, AMT, 5.00%, 05/01/42

    155       173,447  

City of Redding California Electric System Revenue, COP, Refunding Series A (AGM), 5.00%, 06/01/30

    600       601,590  

City of San Jose California, Refunding ARB, Norman Y Mineta San Jose International Airport SJC, AMT:

   

Series A, 5.00%, 03/01/36

    410       459,991  

Series A, 5.00%, 03/01/37

    455       509,741  

Series A-1, 5.75%, 03/01/34

    850       924,035  

County of San Joaquin California Transportation Authority, Refunding RB, Limited Tax, Measure K, Series A, 6.00%, 03/01/21(a)

    2,175       2,417,012  

County of San Mateo California Community College District, GO, CAB, Election of 2001, Series C (NPFGC), 0.00%, 09/01/30(b)

    12,740       8,686,642  

Mount San Antonio Community College District, GO, Refunding, CAB, Election of 2008, Series A, 0.00%, 08/01/43(c)

    2,500       1,997,525  

Poway Unified School District, GO, Refunding, CAB, School Facilities Improvement, Election of 2008, Series B, 0.00%, 08/01/36(b)

    3,750       1,856,625  

Rio Hondo Community College District California, GO, CAB, Election of 2004, Series C, 0.00%, 08/01/38(b)

    5,000       2,278,300  

San Diego California Community College District, GO, CAB, Election of 2006(b):

   

0.00%, 08/01/31

    2,145       1,199,741  

0.00%, 08/01/32

    2,680       1,407,000  
Security   Par
(000)
    Value  
California (continued)  

San Diego California Unified School District, GO, CAB, Election of 2008(b):

   

Series C, 0.00%, 07/01/38

  $ 1,600     $ 734,320  

Series G, 0.00%, 07/01/34

    650       306,390  

Series G, 0.00%, 07/01/35

    690       305,794  

Series G, 0.00%, 07/01/36

    1,035       431,284  

Series G, 0.00%, 07/01/37

    690       270,432  

San Diego California Unified School District, GO, Refunding, Series R-1(b):

   

0.00%, 07/01/30

    5,000       3,313,950  

0.00%, 07/01/31

    1,280       811,725  

San Marcos Unified School District, GO, Election of 2010, Series A(a):

   

5.00%, 08/01/21

    700       767,767  

5.00%, 08/01/21

    600       658,086  

Walnut Valley Unified School District, GO, CAB, Election of 2007, Series B, 0.00%, 08/01/36(b)

    5,500       2,604,910  

West Basin Municipal Water District California, COP, Refunding, Series B (AGC), 5.00%, 08/01/18(a)

    5,035       5,076,539  
   

 

 

 
      48,488,058  
Colorado — 0.6%  

Regional Transportation District, COP, Refunding, Series A, 5.38%, 06/01/31

    2,000       2,122,940  
   

 

 

 
Connecticut — 0.3%  

Connecticut Housing Finance Authority, Refunding RB:

   

S/F Housing, Sub-Series A-1, 3.85%, 11/15/43

    580       572,558  

Sub-Series B-1, 4.00%, 05/15/45(d)

    530       531,993  
   

 

 

 
      1,104,551  
District of Columbia — 1.6%  

District of Columbia Ballpark Revenue, RB, Series B-1 (NPFGC), 5.00%, 02/01/31

    5,360       5,370,130  
   

 

 

 
Florida — 13.9%  

Country of Broward Florida Airport System, ARB, AMT, 5.00%, 10/01/47

    3,150       3,504,721  

County of Brevard Florida Health Facilities Authority, Refunding RB, Health First, Inc. Project, 5.00%, 04/01/39

    1,600       1,721,840  

County of Broward Florida Water & Sewer Utility, Refunding RB, Series A, 5.25%, 10/01/18(a)

    850       862,342  

County of Highlands Florida Health Facilities Authority, RB, Adventist Health System/Sunbelt Obligated Group:

   

6.00%, 11/15/19(a)

    5       5,308  

6.00%, 11/15/37

    1,445       1,539,720  

County of Hillsborough Florida Aviation Authority, RB, Series A, AMT (AGC), 5.38%, 10/01/33

    4,050       4,104,958  

County of Lee Florida, Refunding ARB, Series A, AMT:

   

5.63%, 10/01/26

    960       1,047,053  

5.38%, 10/01/32

    3,160       3,412,579  

County of Miami-Dade Florida, GO, Building Better Communities Program, Series B-1, 5.75%, 07/01/18(a)

    1,400       1,409,240  

County of Miami-Dade Florida, RB, Seaport:

   

Department, Series A, 6.00%, 10/01/38

    2,025       2,317,734  

Department, Series B, AMT, 6.25%, 10/01/38

    415       480,126  

Department, Series B, AMT, 6.00%, 10/01/42

    660       754,697  

Series B, AMT, 6.00%, 10/01/30

    640       728,410  

County of Miami-Dade Florida, Refunding RB, 4.00%, 10/01/40

    885       905,311  

County of Miami-Dade Florida Aviation, Refunding ARB, AMT, 5.00%, 10/01/34

    190       210,032  

County of Miami-Dade Florida Aviation, Refunding RB, Series B, AMT, 5.00%, 10/01/40

    2,490       2,770,399  
 

 

 

28    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniEnhanced Fund, Inc. (MEN)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Florida (continued)  

County of Miami-Dade Florida Educational Facilities Authority, RB, University of Miami, Series A, 5.00%, 04/01/40

  $ 2,995     $ 3,287,971  

County of Miami-Dade Florida Health Facilities Authority, Refunding RB, Nicklaus Children’s Hospital Project, 5.00%, 08/01/42

    605       668,579  

County of Miami-Dade Florida School Board Foundation, Inc., COP, Series B (AGC), 5.00%, 05/01/18(a)

    9,000       9,000,000  

County of Orange Florida Health Facilities Authority, Refunding RB, Presbyterian Retirement Communities Project:

   

5.00%, 08/01/41

    560       608,826  

5.00%, 08/01/47

    1,620       1,756,355  

County of Palm Beach Florida Solid Waste Authority, Refunding RB, Series B:

   

5.00%, 10/01/21(a)

    30       32,779  

5.00%, 10/01/31

    1,970       2,143,636  

County of Putnam Florida Development Authority, Refunding RB, Seminole Project, Series A, 5.00%, 03/15/42

    520       577,902  

County of Sarasota Florida Public Hospital District, RB, Sarasota Memorial Hospital Project, Series A, 5.63%, 07/01/39

    275       285,013  

Florida Ports Financing Commission, Refunding RB, State Transportation Trust Fund, Series B, AMT:

   

5.13%, 06/01/27

    2,000       2,165,200  

5.38%, 10/01/29

    1,050       1,151,776  
   

 

 

 
      47,452,507  
Georgia — 3.5%  

County of Gainesville Georgia & Hall Hospital Authority, Refunding RB, Northeast Georgia Health System, Inc. Project, Series A, 5.50%, 08/15/54

    500       570,935  

County of LaGrange-Troup Hospital Authority, Refunding RB, Revenue Anticipation Certificates, 4.00%, 04/01/47

    1,250       1,210,375  

Municipal Electric Authority of Georgia, Refunding RB, Series EE (AMBAC), 7.00%, 01/01/25

    7,475       9,381,424  

Private Colleges & Universities Authority, RB, Savannah College of Art & Design:

   

5.00%, 04/01/33

    140       152,453  

5.00%, 04/01/44

    380       408,306  
   

 

 

 
      11,723,493  
Illinois — 16.0%  

City of Chicago Illinois O’Hare International Airport, ARB, Senior Lien, Series D, 5.25%, 01/01/42

    2,900       3,280,944  

City of Chicago Illinois O’Hare International Airport, GARB:

   

3rd Lien, Series A, 5.75%, 01/01/21(a)

    4,290       4,691,115  

3rd Lien, Series A, 5.75%, 01/01/39

    820       888,896  

Senior Lien, Series D, AMT, 5.00%, 01/01/42

    230       250,201  

City of Chicago Illinois Transit Authority, RB:

   

5.25%, 12/01/49

    900       986,850  

Sales Tax Receipts, 5.25%, 12/01/36

    595       636,769  

County of Cook Illinois Forest Preserve District, GO, Refunding, Limited Tax Project, Series B, 5.00%, 12/15/37

    45       47,250  

Illinois Finance Authority, RB, Carle Foundation, Series A:

   

5.75%, 08/15/34

    650       715,137  

6.00%, 08/15/41

    1,000       1,105,050  

Illinois Finance Authority, Refunding RB, Silver Cross Hospital & Medical Centers, Series C:

   

4.13%, 08/15/37

    740       737,521  

5.00%, 08/15/44

    350       368,519  

Illinois Sports Facilities Authority, RB, State Tax Supported (AMBAC), 5.50%, 06/15/30

    10,490       10,507,938  

Illinois State Toll Highway Authority, RB, Series B, 5.00%, 01/01/37

    2,785       3,109,174  

Kane McHenry Cook & De Kalb Counties Unit School District No. 300, GO, Refunding, 5.25%, 01/01/33

    9,145       10,138,970  
Security   Par
(000)
    Value  
Illinois (continued)  

Metropolitan Pier & Exposition Authority, RB, CAB, McCormick Place Expansion Project, Series A (NPFGC)(b):

   

0.00%, 12/15/26

  $ 5,000     $ 3,435,950  

0.00%, 12/15/33

    9,950       4,772,119  

Metropolitan Pier & Exposition Authority, Refunding RB, CAB, McCormick Place Expansion Project, Series B (AGM), 0.00%, 06/15/44(b)

    3,450       1,004,571  

Railsplitter Tobacco Settlement Authority, RB, 6.00%, 06/01/21(a)

    675       752,476  

Regional Transportation Authority, RB, Series A (AMBAC), 7.20%, 11/01/20

    3,565       3,834,157  

State of Illinois, GO:

   

5.25%, 02/01/33

    830       849,339  

5.50%, 07/01/33

    820       848,192  

5.25%, 02/01/34

    830       848,501  

5.50%, 07/01/38

    445       458,043  
   

 

 

 
      54,267,682  
Indiana — 1.2%  

Indiana Finance Authority, RB, Series A:

   

CWA Authority Project, 1st Lien, 5.25%, 10/01/38

    1,100       1,199,506  

Private Activity Bond, Ohio River Bridges East End Crossing Project, AMT, 5.00%, 07/01/44

    515       548,423  

Indiana Health & Educational Facilities Financing Authority, Refunding RB, Ascension Senior Credit Group, 5.00%, 11/15/46

    700       791,784  

Indianapolis Local Public Improvement Bond Bank, Refunding RB, Waterworks Project, Series A (AGC):

   

5.25%, 01/01/19(a)

    115       117,650  

5.25%, 01/01/29

    485       495,752  

State of Indiana Finance Authority, RB, Private Activity Bond, Ohio River Bridges, Series A, AMT, 5.00%, 07/01/40

    890       949,924  
   

 

 

 
      4,103,039  
Iowa — 2.8%  

Iowa Finance Authority, RB, Iowa Health Care Facilities, Series A (AGC), 5.63%, 08/15/19(a)

    5,725       5,992,243  

Iowa Student Loan Liquidity Corp., RB, Senior Series A-2, AMT:

   

5.60%, 12/01/26

    1,630       1,704,083  

5.70%, 12/01/27

    735       764,834  

5.80%, 12/01/29

    500       519,855  

5.85%, 12/01/30

    520       540,972  
   

 

 

 
      9,521,987  
Louisiana — 1.7%  

City of New Orleans Louisiana Aviation Board, ARB, Series B, AMT, 5.00%, 01/01/40

    2,795       3,019,718  

Louisiana Public Facilities Authority, Refunding RB, Christus Health, Series B (AGC), 6.50%, 07/01/30

    1,250       1,285,600  

State of Louisiana Gasoline & Fuels Tax Revenue, Refunding RB, First Lien, Series A, 4.00%, 05/01/41

    1,520       1,546,950  
   

 

 

 
      5,852,268  
Maine — 0.2%  

Maine State Housing Authority, RB, Series D-1, 3.65%, 11/15/42

    645       625,631  
   

 

 

 
Maryland — 0.4%  

State of Maryland Stadium Authority Revenue, RB, Construction & Revitalization, 5.00%, 05/01/36

    1,235       1,410,284  
   

 

 

 
Massachusetts — 2.3%  

Massachusetts Development Finance Agency, RB, Emerson College Issue, Series A, 5.00%, 01/01/47

    2,090       2,252,769  

Massachusetts Development Finance Agency, Refunding RB, Partners Health Care System, 4.00%, 07/01/41

    920       930,267  
 

 

 

SCHEDULES OF INVESTMENTS      29  


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniEnhanced Fund, Inc. (MEN)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Massachusetts (continued)  

Massachusetts HFA, Refunding RB, AMT:

   

Series A, 4.45%, 12/01/42

  $ 795     $ 821,490  

Series C, 5.35%, 12/01/42

    460       468,317  

Massachusetts Port Authority, Refunding ARB, Series A, AMT, 5.00%, 07/01/47

    1,720       1,912,141  

Massachusetts School Building Authority, RB, Dedicated Sales Tax, Senior Series A, 5.00%, 05/15/43

    1,280       1,406,989  
   

 

 

 
      7,791,973  
Michigan — 2.7%  

City of Detroit Michigan Sewage Disposal System, Refunding RB, 2nd Lien, Series E (BHAC), 5.75%, 07/01/18(a)

    2,500       2,516,075  

City of Detroit Michigan Water Supply System Revenue, RB, 2nd Lien, Series B (AGM), 6.25%, 07/01/19(a)

    400       419,828  

City of Lansing Michigan, RB, Board of Water & Light Utilities System, Series A, 5.50%, 07/01/41

    1,700       1,860,667  

Michigan Finance Authority, Refunding RB:

   

Henry Ford Health System, 3.25%, 11/15/42

    460       395,375  

Trinity Health Credit Group, 5.00%, 12/01/21(a)

    20       21,925  

Michigan State Hospital Finance Authority, Refunding RB, Ascension Senior Credit Group, 4.00%, 11/15/47

    600       603,012  

Royal Oak Hospital Finance Authority Michigan, Refunding RB, Beaumont Health Credit Group, Series D, 5.00%, 09/01/39

    1,040       1,126,715  

State of Michigan Building Authority, Refunding RB, Facilities Program:

   

Series I-A, 5.38%, 10/15/36

    145       159,716  

Series I-A, 5.38%, 10/15/41

    700       766,899  

Series II-A (AGM), 5.25%, 10/15/36

    900       987,633  

Western Michigan University, Refunding RB, General, University and College Improvements (AGM), 5.00%, 11/15/39

    380       420,949  
   

 

 

 
      9,278,794  
Minnesota — 0.8%  

City of Minneapolis Minnesota, Refunding RB, Fairview Health Services, Series B (AGC):

   

6.50%, 11/15/18(a)

    385       394,671  

6.50%, 11/15/38

    2,115       2,167,664  
   

 

 

 
      2,562,335  
Mississippi — 0.1%  

Mississippi State University Educational Building Corp., Refunding RB, Mississippi State University Facilities Refinancing, Series A, 4.00%, 08/01/43

    400       408,992  
   

 

 

 
Nebraska — 1.8%  

Central Plains Nebraska Energy Project, RB, Gas Project No. 3:

   

5.00%, 09/01/32

    5,010       5,454,237  

5.25%, 09/01/37

    750       824,100  
   

 

 

 
      6,278,337  
Nevada — 1.6%  

City of Las Vegas Nevada, GO, Limited Tax, Performing Arts Center, 6.00%, 04/01/19(a)

    850       881,883  

County of Clark Nevada, ARB, Las Vegas-McCarran International Airport, Series A:

   

5.25%, 07/01/42

    500       525,020  

(AGM), 5.25%, 07/01/39

    3,800       3,992,052  
   

 

 

 
      5,398,955  
New Jersey — 8.8%  

New Jersey EDA, RB:

   

Goethals Bridge Replacement Project, AMT, Private Activity Bond, 5.38%, 01/01/43

    895       975,219  

Goethals Bridge Replacement Project, AMT, Private Activity Bond, 5.13%, 01/01/34

    685       745,383  

School Facilities Construction (AGC), 6.00%, 12/15/18(a)

    1,975       2,025,955  
Security   Par
(000)
    Value  
New Jersey (continued)  

School Facilities Construction (AGC), 6.00%, 12/15/18(a)

  $ 25     $ 25,653  

Series WW, 5.25%, 06/15/33

    155       166,794  

Series WW, 5.00%, 06/15/34

    205       216,154  

Series WW, 5.00%, 06/15/36

    925       974,164  

Series WW, 5.25%, 06/15/40

    265       282,628  

New Jersey EDA, Refunding RB:

   

Series B, 5.50%, 06/15/30

    5,360       6,078,937  

Sub-Series A, 4.00%, 07/01/32

    1,270       1,260,450  

New Jersey Higher Education Student Assistance Authority, Refunding RB, Series 1, AMT:

   

5.50%, 12/01/26

    360       382,154  

5.75%, 12/01/27

    2,330       2,500,859  

New Jersey Housing & Mortgage Finance Agency, Refunding RB, M/F Housing, Series 2, AMT, 4.35%, 11/01/33

    970       998,334  

New Jersey Transportation Trust Fund Authority, RB:

   

Transportation Program, Series AA, 5.25%, 06/15/33

    1,490       1,579,623  

Transportation Program, Series AA, 5.00%, 06/15/38

    1,885       1,970,730  

Transportation System, Series A, 5.50%, 06/15/41

    3,150       3,286,174  

Transportation System, Series AA, 5.50%, 06/15/39

    1,150       1,228,533  

Transportation System, Series B, 5.50%, 06/15/31

    1,000       1,059,180  

Transportation System, Series B, 5.00%, 06/15/42

    520       534,778  

Transportation System, Series D, 5.00%, 06/15/32

    735       779,975  

South Jersey Port Corp., ARB, Marine Terminal, Series B, AMT, 5.00%, 01/01/42

    390       416,789  

Tobacco Settlement Financing Corp., Refunding RB, Series A:

   

5.00%, 06/01/46

    1,845       1,991,991  

5.25%, 06/01/46

    405       449,805  
   

 

 

 
      29,930,262  
New York — 6.2%  

City of New York New York Municipal Water Finance Authority, Refunding RB, Second General Resolution, Fiscal 2012, Series BB, 5.25%, 06/15/44

    1,425       1,568,583  

City of New York New York Transitional Finance Authority, BARB, Fiscal 2009, Series S-4, 5.50%, 01/15/33

    1,600       1,641,456  

City of New York New York Transitional Finance Authority, RB:

   

Fiscal 2009, Series S-4, 5.50%, 01/15/34

    2,750       2,821,060  

Series S-3, 4.00%, 07/15/46

    1,130       1,152,758  

City of New York New York Transitional Finance Authority, Refunding RB, Future Tax Secured, Series B, 5.00%, 11/01/32

    1,480       1,634,468  

Hudson Yards Infrastructure Corp., RB, Senior, Fiscal 2012:

   

5.75%, 02/15/21(a)

    430       473,348  

5.75%, 02/15/47

    270       291,946  

Metropolitan Transportation Authority, RB, Series C:

   

6.50%, 11/15/18(a)

    2,985       3,060,132  

6.50%, 11/15/18(a)

    245       251,167  

6.50%, 11/15/28

    770       789,673  

New York Transportation Development Corp., ARB, LaGuardia Airport Terminal B Redevelopment Project, Series A, AMT, 5.25%, 01/01/50

    2,715       2,935,567  

State of New York Dormitory Authority, RB, Series B, 5.75%, 03/15/19(a)

    1,200       1,241,100  

State of New York HFA, RB, M/F Housing, Series B:

   

Affordable Housing, AMT, 5.30%, 11/01/37

    2,500       2,502,700  

Green Bond, 3.88%, 11/01/48

    590       587,380  
   

 

 

 
      20,951,338  
Ohio — 2.2%  

County of Allen Ohio Hospital Facilities Revenue, Refunding RB, Series A, 4.00%, 08/01/38

    1,565       1,566,174  

County of Butler Ohio, Refunding RB, UC Health, 4.00%, 11/15/37

    460       462,898  

County of Lucas Ohio, Refunding RB, Promedica Healthcare, Series A, 6.50%, 11/15/21(a)

    530       606,537  
 

 

 

30    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniEnhanced Fund, Inc. (MEN)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Ohio (continued)  

State of Ohio Turnpike Commission, RB, CAB, Junior Lien, Infrastructure Projects, Series A-2, 0.00%, 02/15/37(b)

  $ 10,000     $ 4,804,800  
   

 

 

 
      7,440,409  
Oregon — 1.5%  

Counties of Washington & Multnomah Oregon School District No. 48J Beaverton, GO, Convertible CAB, Series D, 0.00%, 06/15/36(c)

    835       942,456  

County of Clackamas Oregon Community College District, GO, Convertible Deferred Interest Bonds, Series A, 0.00%, 06/15/40(c)

    440       448,021  

County of Clackamas Oregon School District No. 12 North Clackamas, GO, CAB, Series A, 0.00%, 06/15/38(b)

    995       429,651  

State of Oregon, GO, Refunding, Veteran’s Welfare Series 100th, 3.65%, 06/01/42

    610       596,574  

State of Oregon Housing & Community Services Department, RB, Series D, 3.45%, 01/01/38

    2,815       2,724,864  
   

 

 

 
      5,141,566  
Pennsylvania — 8.8%  

Commonwealth Financing Authority, RB:

   

Series B, 5.00%, 06/01/42

    1,600       1,708,672  

Tobacco Master Settlement Payment, 5.00%, 06/01/33

    220       246,037  

Tobacco Master Settlement Payment, 5.00%, 06/01/34

    390       433,364  

Tobacco Master Settlement Payment, 5.00%, 06/01/35

    740       820,312  

Tobacco Master Settlement Payment (AGM), 4.00%, 06/01/39

    1,050       1,053,434  

County of Berks IDA, Refunding RB, Tower Health Project, 4.00%, 11/01/39

    320       320,000  

County of Montgomery Higher Education & Health Authority, Refunding RB, Thomas Jefferson University, Series A, 4.00%, 09/01/49

    645       634,770  

Pennsylvania Economic Development Financing Authority, RB:

   

AMT, 5.00%, 06/30/42

    1,035       1,107,895  

PA Bridges Finco LP, AMT, 5.00%, 12/31/34

    7,290       7,914,534  

Pennsylvania Bridge Finco LP, 5.00%, 12/31/38

    1,305       1,405,394  

Pennsylvania Economic Development Financing Authority, Refunding RB, Series A, 4.00%, 11/15/42

    570       575,404  

Pennsylvania Higher Educational Facilities Authority, Refunding RB, Thomas Jefferson University, Series A, 5.25%, 09/01/50

    2,330       2,572,739  

Pennsylvania Turnpike Commission, RB:

   

Series A, 5.00%, 12/01/38

    620       678,032  

Series A-1, 5.00%, 12/01/41

    2,385       2,627,793  

Series B, 5.00%, 12/01/40

    935       1,030,267  

Series C, 5.50%, 12/01/23(a)

    555       644,350  

Sub-Series B-1, 5.00%, 06/01/42

    1,750       1,909,950  

Subordinate, Special Motor License Fund, 6.00%, 12/01/20(a)

    575       631,333  

Pennsylvania Turnpike Commission, Refunding RB:

   

Motor Licensed Fund Enhancement, Third Series, 4.00%, 12/01/38

    2,070       2,092,977  

Series A-1, 5.00%, 12/01/40

    765       840,926  

Philadelphia School District, GO, Refunding, Series F, 5.00%, 09/01/38

    305       335,021  

Philadelphia School District, GO, Series E(a):

   

6.00%, 09/01/18

    5       5,069  

6.00%, 09/01/18

    395       400,494  
   

 

 

 
      29,988,767  
Rhode Island — 1.1%  

Tobacco Settlement Financing Corp., Refunding RB, Series B:

   

4.50%, 06/01/45

    1,055       1,065,803  

5.00%, 06/01/50

    2,630       2,694,461  
   

 

 

 
      3,760,264  
Security   Par
(000)
    Value  
South Carolina — 4.9%  

South Carolina Jobs EDA, Refunding RB, Palmetto Health, Series A (AGM), 6.50%, 08/01/21(a)

  $ 115     $ 130,063  

South Carolina Transportation Infrastructure Bank, RB, Series A, 5.25%, 10/01/19(a)

    3,000       3,137,340  

State of South Carolina Ports Authority, RB, AMT, 5.25%, 07/01/50

    2,330       2,573,858  

State of South Carolina Public Service Authority, RB, Santee Cooper:

   

Series A, 5.50%, 12/01/54

    6,225       6,794,525  

Series E, 5.50%, 12/01/53

    745       812,422  

State of South Carolina Public Service Authority, Refunding RB:

   

Santee Cooper, Series B, 5.00%, 12/01/38

    2,080       2,216,240  

Series A, 5.50%, 01/01/19(a)

    80       81,948  

Series A, 5.50%, 01/01/19(a)

    920       941,786  
   

 

 

 
      16,688,182  
South Dakota — 1.3%  

South Dakota Health & Educational Facilities Authority, Refunding RB, Avera Health Issue:

   

4.00%, 07/01/37

    1,225       1,239,026  

4.00%, 07/01/42

    3,000       3,018,210  
   

 

 

 
      4,257,236  
Tennessee — 2.1%  

Metropolitan Government of Nashville & Davidson County Health & Educational Facilities Board, Refunding RB, Vanderbilt University, Series B, 5.50%, 10/01/19(a)

    5,000       5,253,450  

Tennessee Housing Development Agency, RB:

   

3.60%, 07/01/42

    550       533,538  

3.65%, 07/01/47

    1,465       1,416,362  
   

 

 

 
      7,203,350  
Texas — 14.9%  

City of Houston Texas Combined Utility System Revenue, Refunding RB, Combined 1st Lien, Series A (AGC):

   

5.38%, 05/15/19(a)

    1,280       1,325,414  

6.00%, 05/15/19(a)

    1,990       2,073,301  

6.00%, 11/15/35

    110       114,720  

5.38%, 11/15/38

    70       72,403  

City of San Antonio Texas Electric & Gas Revenue, RB, Junior Lien, 5.00%, 02/01/38

    575       624,444  

County of Midland Texas Fresh Water Supply District No. 1, RB, CAB, City of Midland Project, Series A, 0.00%, 09/15/36(b)

    2,130       990,045  

County of Tarrant Texas Cultural Education Facilities Finance Corp., Refunding RB, Cook Children’s Medical Center, 5.25%, 12/01/39

    750       827,985  

Dallas Texas Area Rapid Transit, Refunding RB, Series A, 5.00%, 12/01/48

    3,160       3,513,130  

Dallas-Fort Worth International Airport, ARB, Joint Improvement, AMT:

   

Series D, 5.00%, 11/01/38

    1,975       2,108,609  

Series D, 5.00%, 11/01/42

    1,500       1,598,385  

Series H, 5.00%, 11/01/32

    3,000       3,223,590  

Dallas-Fort Worth International Airport, Refunding ARB, Series F, 5.25%, 11/01/33

    975       1,098,045  

Grand Parkway Transportation Corp., RB, Convertible CAB, Series B, 0.00%, 10/01/46(c)

    2,095       1,914,222  

Leander ISD, GO, Refunding, CAB, Series D (PSF-GTD), 0.00%, 08/15/38(b)

    3,420       1,400,319  

North Texas Tollway Authority, Refunding RB, 1st Tier:

   

System, Series A, 6.00%, 01/01/19(a)

    2,270       2,331,948  

System, Series A, 6.00%, 01/01/28

    525       538,445  

System, Series K-2 (AGC), 6.00%, 01/01/19(a)

    4,015       4,125,934  

Series K-1 (AGC), 5.75%, 01/01/19(a)

    3,800       3,898,762  
 

 

 

SCHEDULES OF INVESTMENTS      31  


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniEnhanced Fund, Inc. (MEN)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Texas (continued)  

San Antonio Public Facilities Corp., Refunding RB, Convention Center Refinancing & Expansion Project, CAB(b):

   

0.00%, 09/15/35

  $ 4,990     $ 2,271,897  

0.00%, 09/15/36

    11,525       4,944,571  

0.00%, 09/15/37

    8,245       3,327,270  

San Antonio Water System, Refunding RB, Junior Lien, Series A, 5.00%, 05/15/48(d)

    1,355       1,540,500  

Texas Municipal Gas Acquisition & Supply Corp. III, RB, Natural Gas Utility Improvements:

   

5.00%, 12/15/31

    1,190       1,288,711  

5.00%, 12/15/32

    705       761,901  

Texas Private Activity Bond Surface Transportation Corp., RB, Senior Lien, AMT, Blueridge Transportation Group, 5.00%, 12/31/45

    1,275       1,376,720  

Texas Transportation Commission, Refunding RB, Central Texas Turnpike System, 1st Tier, Series A, 5.00%, 08/15/41

    3,080       3,311,770  
   

 

 

 
      50,603,041  
Utah — 1.1%  

Salt Lake City Corp. Airport Revenue, ARB, Series A, AMT, 5.00%, 07/01/42

    1,240       1,381,596  

Utah Transit Authority, RB, Series A (AGM), 5.00%, 06/15/18(a)

    2,500       2,509,650  
   

 

 

 
      3,891,246  
Virginia — 0.1%  

County of Fairfax Virginia IDA, Refunding RB, Health Care-Inova Health(a):

   

5.50%, 05/15/19

    125       129,594  

5.50%, 05/15/19

    225       233,388  
   

 

 

 
      362,982  
Washington — 1.2%  

Port of Seattle Washington, RB, Intermediate Lien, Series C, AMT, 5.00%, 04/01/40

    1,015       1,094,505  

Washington Health Care Facilities Authority, RB, Providence Health & Services, Series A:

   

5.00%, 10/01/39

    525       548,163  

5.25%, 10/01/39

    625       657,031  

Washington Health Care Facilities Authority, Refunding RB, Multicare Health System, Series B, 4.00%, 08/15/41

    1,835       1,863,167  
   

 

 

 
      4,162,866  
Wisconsin — 1.5%  

State of Wisconsin Health & Educational Facilities Authority, RB:

   

Ascension Health Senior Credit Group, Series E, 5.00%, 11/15/33

    1,375       1,434,097  

Marshfield Clinic Health System, Inc. Series C, 4.00%, 02/15/42

    1,450       1,432,383  

State of Wisconsin Health & Educational Facilities Authority, Refunding RB, Froedtert Health, Inc. Obligated Group, 4.00%, 04/01/39

    2,205       2,198,738  
   

 

 

 
      5,065,218  
   

 

 

 

Total Municipal Bonds — 124.9%
(Cost — $399,221,333)

 

    424,881,524  
   

 

 

 

Municipal Bonds Transferred to Tender Option Bond Trusts(e)

 

Arizona — 0.4%  

City of Phoenix Civic Improvement Corp., Refunding RB, Water System, Junior Lien, Series A, 5.00%, 07/01/19(a)

    1,200       1,243,026  
   

 

 

 
California — 2.9%  

Bay Area Toll Authority, Refunding RB, San Francisco Bay Area Toll Bridge Subordinate, 4.00%, 04/01/47(f)

    3,827       3,939,316  
Security   Par
(000)
    Value  
California (continued)  

County of San Diego California Water Authority Financing Corp., COP, Refunding Series A (AGM)(a):

   

5.00%, 05/01/18

  $ 466     $ 466,179  

5.00%, 05/01/18

    2,344       2,343,821  

Los Angeles California Unified School District, GO, Election of 2008, Series B-1, 5.25%, 07/01/42(f)

    1,571       1,863,581  

San Diego California Community College District, GO, Election of 2002, 5.25%, 08/01/19(a)

    404       420,986  

University of California, RB, Series O, 5.75%, 05/15/19(a)

    840       874,089  
   

 

 

 
      9,907,972  
Colorado — 2.4%  

Colorado Health Facilities Authority, Refunding RB, Catholic Health Initiatives, Series A:

   

5.50%, 07/01/34(f)

    900       928,251  

5.00%, 02/01/41

    7,000       7,281,505  
   

 

 

 
      8,209,756  
Connecticut — 0.4%  

State of Connecticut Health & Educational Facility Authority, Refunding RB, Trinity Health Credit Group, 5.00%, 12/01/45

    1,381       1,534,439  
   

 

 

 
District of Columbia — 1.6%  

District of Columbia, RB, Series A, 5.50%, 12/01/30(f)

    1,005       1,059,892  

District of Columbia Water & Sewer Authority, Refunding RB, Series A, 6.00%, 10/01/18(a)(f)

    1,779       1,809,176  

Metropolitan Washington Airports Authority, Refunding ARB, Series A, AMT, 5.00%, 10/01/30

    2,530       2,753,854  
   

 

 

 
      5,622,922  
Florida — 4.8%  

County of Miami-Dade Florida Transit System, Refunding RB, Sales Tax, 5.00%, 07/01/42

    4,480       4,834,167  

County of Miami-Dade Florida Water & Sewer System, RB, (AGM), 5.00%, 10/01/20(a)

    4,621       4,942,771  

County of Orange Florida School Board, COP, Series A (AGC), 5.50%, 08/01/19(a)

    3,544       3,701,767  

South Miami Health Facilities Authority, Refunding RB, Baptist Health South Florida, 5.00%, 08/15/47

    2,640       2,933,814  
   

 

 

 
      16,412,519  
Illinois — 3.2%  

State of Illinois, RB, Build Illinois, Series B, 5.25%, 06/15/19(a)(f)

    4,399       4,561,300  

State of Illinois Toll Highway Authority, RB:

   

Series A, 5.00%, 01/01/38

    2,138       2,328,734  

Series A, 5.00%, 01/01/40

    2,730       3,007,804  

Series B, 5.00%, 01/01/40

    1,050       1,164,141  
   

 

 

 
      11,061,979  
Kansas — 1.6%  

County of Wyandotte Kansas Unified School District, GO, Series A, 5.50%, 09/01/47

    4,723       5,575,843  
   

 

 

 
Maryland — 1.3%  

City of Baltimore Maryland Water Utility Fund, RB, Series A:

   

Sub-Water Projects, 5.00%, 07/01/41

    2,808       3,149,446  

Wastewater Project, 5.00%, 07/01/46

    1,061       1,186,984  
   

 

 

 
      4,336,430  
Massachusetts — 0.5%  

Commonwealth of Massachusetts, GO, Series A, 5.00%, 03/01/46

    1,461       1,610,701  
   

 

 

 
Michigan — 3.3%  

Michigan Finance Authority, RB, Beaumont Health Credit Group, Series A, 5.00%, 11/01/44

    1,970       2,150,257  
 

 

 

32    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniEnhanced Fund, Inc. (MEN)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Michigan (continued)  

Michigan Finance Authority, Refunding RB, Hospital, Trinity Health Credit Group, 5.00%, 12/01/39

  $ 7,530     $ 8,146,632  

Michigan State Building Authority, Refunding RB, Facilities Program, Series I, 5.00%, 10/15/45

    870       965,500  
   

 

 

 
      11,262,389  
Nevada — 5.3%  

City of Las Vegas Nevada, GO, Limited Tax, Performing Arts Center, 6.00%, 04/01/19(a)(f)

    3,778       3,916,695  

County of Clark Nevada, GOL, Stadium Improvement, Series A, 5.00%, 06/01/38

    3,061       3,502,738  

County of Clark Nevada Water Reclamation District, GO, Series B(a):

   

5.50%, 07/01/19

    4,499       4,681,940  

5.75%, 07/01/19

    1,829       1,909,096  

Las Vegas Valley Water District Nevada, GO, Refunding, Water Improvement, Series A, 5.00%, 06/01/46

    3,460       3,879,343  
   

 

 

 
      17,889,812  
New Jersey — 2.2%  

County of Hudson New Jersey Improvement Authority, RB, Hudson County Vocational-Technical Schools Project, 5.25%, 05/01/51

    800       901,678  

New Jersey State Turnpike Authority, Refunding RB:

   

Series B, 4.00%, 01/01/37

    2,308       2,396,567  

Series G, 4.00%, 01/01/43

    2,146       2,203,346  

New Jersey Transportation Trust Fund Authority, RB, Transportation System, Series B, 5.25%, 06/15/36(f)

    1,840       1,913,753  
   

 

 

 
      7,415,344  
New York — 6.6%  

City of New York New York Municipal Water Finance Authority, RB, Water & Sewer System, Fiscal 2009, Series A:

   

5.75%, 06/15/18(a)

    290       290,756  

5.75%, 06/15/40

    969       972,300  

City of New York New York Transitional Finance Authority, RB, Future Tax, Sub-Series A-3, 5.00%, 08/01/40(f)

    3,058       3,482,861  

City of New York New York Water & Sewer System, Refunding RB:

   

2nd General Resolution, Fiscal 2013, Series CC, 5.00%, 06/15/47

    5,680       6,233,787  

Series DD, 5.00%, 06/15/35

    1,665       1,857,585  

Metropolitan Transportation Authority, RB, Transportation, Sub-Series D-1, 5.25%, 11/15/44

    3,470       3,911,506  

Metropolitan Transportation Authority, Refunding RB, Series C-1, 5.25%, 11/15/56

    1,500       1,689,762  

Port Authority of New York & New Jersey, Refunding ARB, Consolidated, 198th Series, 5.25%, 11/15/56

    2,241       2,552,670  

Triborough Bridge & Tunnel Authority, RB, General, Series A-2, 5.25%, 11/15/34(f)

    1,300       1,324,356  
   

 

 

 
      22,315,583  
Ohio — 1.1%  

Northeast Ohio Regional Sewer District, Refunding RB, 4.00%, 11/15/43

    2,912       3,006,388  

State of Ohio, RB, Cleveland Clinic Health Obligated Group, Series B, 5.50%, 01/01/34

    580       593,955  
   

 

 

 
      3,600,343  
Pennsylvania — 0.3%  

County of Westmoreland Pennsylvania Municipal Authority, Refunding RB, (BAM), 5.00%, 08/15/42

    900       996,485  
   

 

 

 
Security   Par
(000)
    Value  
South Carolina — 0.4%  

South Carolina Public Service Authority, Refunding RB, Series A(a)(f):

   

5.50%, 01/01/19

  $ 102     $ 103,982  

5.50%, 01/01/19

    1,175       1,202,330  
   

 

 

 
      1,306,312  
Texas — 2.5%  

City of Houston Texas Community College, GO, 4.00%, 02/15/43

    1,470       1,492,344  

County of Harris Texas Toll Road Authority, Refunding RB, Senior Lien, Series A, 5.00%, 08/15/43

    1,229       1,400,955  

County of Tarrant Texas Cultural Education Facilities Finance Corp., Refunding RB, Texas Health Resources System, Series A, 5.00%, 02/15/41

    3,440       3,837,010  

San Antonio Public Facilities Corp., Refunding RB, Convention Center Refinancing And Expansion Project, 4.00%, 09/15/42

    1,874       1,889,521  
   

 

 

 
      8,619,830  
Virginia — 0.8%  

Hampton Roads Transportation Accountability Commission, RB, Transportation Fund, Senior Lien, Series A, 5.50%, 07/01/57

    2,234       2,647,922  
   

 

 

 
Washington — 1.0%  

Washington Health Care Facilities Authority, Refunding RB, Seattle Children’s Hospital, Series B, 5.00%, 10/01/38

    2,880       3,325,181  
   

 

 

 
Wisconsin — 1.0%  

Wisconsin Health & Educational Facilities Authority, Refunding RB, Froedtert & Community Health, Inc., Obligated Group:

   

Series A, 5.00%, 04/01/42

    1,980       2,102,265  

Series C, 5.25%, 04/01/19(a)(f)

    1,430       1,473,626  
   

 

 

 
      3,575,891  
   

 

 

 

Total Municipal Bonds Transferred to Tender Option Bond
Trusts — 43.6%
(Cost — $146,353,790)

 

    148,470,679  
   

 

 

 

Total Investments — 168.5%
(Cost — $545,575,123)

 

    573,352,203  

Liabilities in Excess of Other Assets — (0.9)%

 

    (3,029,244

Liability for TOB Trust Certificates, Including Interest Expense and Fees Payable — (25.8)%

 

    (87,719,776

VRDP Shares, at Liquidation Value, Net of Deferred Offering
Costs — (41.8)%

 

    (142,317,149
   

 

 

 

Net Assets Applicable to Common Shares — 100.0%

 

  $ 340,286,034  
   

 

 

 

 

(a) U.S. Government securities, held in escrow, are used to pay interest on this security, as well as to retire the bond in full at the date indicated, typically at a premium to par.
(b) Zero-coupon bond.
(c) Step-up bond that pays an initial coupon rate for the first period and then a higher coupon rate for the following periods. Rate as of period end.
(d) When-issued security.
(e) Represent bonds transferred to a TOB Trust in exchange of cash and residual certificates received by the Fund. These bonds serve as collateral in a secured borrowing. See Note 4 of the Notes to Financial Statements for details.
 

 

 

SCHEDULES OF INVESTMENTS      33  


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniEnhanced Fund, Inc. (MEN)

 

 

  (f) All or a portion of security is subject to a recourse agreement. The aggregate maximum potential amount the Fund could ultimately be required to pay under the agreements, which expire between June 15, 2018 to January 1, 2026, is $17,082,811. See Note 4 of the Notes to Financial Statements for details.  

 

Affiliated    Shares
Held at
04/30/17
     Net
Activity
     Shares
Held at
04/30/18
     Value at
04/30/18
     Income      Net
Realized
Gain (Loss)
 (a)
     Change in
Unrealized
Appreciation
(Depreciation)
 

BlackRock Liquidity Funds, MuniCash, Institutional Class

     1,790,782        (1,790,782           $      $ 30,721      $ 136      $ (217
           

 

 

    

 

 

    

 

 

    

 

 

 

 

  (a) Includes net capital gain distributions, if applicable.  

Derivative Financial Instruments Outstanding as of Period End

Futures Contracts

 

Description    Number of
Contracts
       Expiration
Date
       Notional
Amount
 (000)
       Value/
Unrealized
Appreciation
(Depreciation)
 

Short Contracts:

                 

10-Year U.S. Treasury Note

     60          06/20/18        $ 7,178        $ 36,502  

Long U.S. Treasury Bond

     113          06/20/18          16,254          9,237  

5-Year U.S. Treasury Note

     18          06/29/18          2,043          6,888  
                 

 

 

 
                  $ 52,627  
                 

 

 

 

Derivative Financial Instruments Categorized by Risk Exposure

As of year end, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:

 

      Commodity
Contracts
     Credit
Contracts
     Equity
Contracts
     Foreign
Currency
Exchange
Contracts
     Interest
Rate
Contracts
     Other
Contracts
     Total  

Assets — Derivative Financial Instruments

                    

Futures contracts

                    

Net unrealized appreciation(a)

   $      $      $      $      $ 52,627      $      $ 52,627  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

  (a)  Includes cumulative appreciation (depreciation) on futures contracts, if any, as reported in the Schedule of Investments. Only current day’s variation margin is reported within the Statements of Assets and Liabilities.  

For the year ended April 30, 2018, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

      Commodity
Contracts
     Credit
Contracts
     Equity
Contracts
     Foreign
Currency
Exchange
Contracts
     Interest
Rate
Contracts
     Other
Contracts
     Total  

Net Realized Gain (Loss) from:

                    

Futures contracts

   $      $      $      $      $ 1,311,360      $      $ 1,311,360  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
Net Change in Unrealized Appreciation (Depreciation) on:                                                 

Futures contracts

   $      $      $      $      $ 523,755      $      $ 523,755  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

Futures contracts:

        

Average notional value of contracts — short

   $ 27,284,861  

For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.

 

 

34    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniEnhanced Fund, Inc. (MEN)

 

Fair Value Hierarchy as of Period End

Various inputs are used in determining the fair value of investments and derivative financial instruments. For information about the Fund’s policy regarding valuation of investments and derivative financial instruments, refer to the Notes to Financial Statements.

The following tables summarize the Fund’s investments and derivative financial instruments categorized in the disclosure hierarchy:

 

      Level 1        Level 2        Level 3        Total  

Assets:

 

Investments:

 

Long-Term Investments(a)

   $        $ 573,352,203        $        $ 573,352,203  
  

 

 

      

 

 

      

 

 

      

 

 

 

Derivative Financial Instruments(b)

 

Assets:

 

Interest rate contracts

   $ 52,627        $        $             —        $ 52,627  
  

 

 

      

 

 

      

 

 

      

 

 

 

 

  (a)  See above Schedule of Investments for values in each state or political subdivision.  
  (b)  Derivative financial instruments are futures contracts which are valued at the unrealized appreciation (depreciation) on the instrument.  

The Fund may hold assets and/or liabilities in which the fair value approximates the carrying for financial statement purposes. As of year end, such assets and/or liabilities are categorized within the disclosure hierarchy as follows:

 

      Level 1      Level 2        Level 3      Total  

Liabilities:

 

TOB Trust Certificates

   $      $ (87,395,145      $      $ (87,395,145

VRDP Shares at Liquidation Value

            (142,500,000               (142,500,000
  

 

 

    

 

 

      

 

 

    

 

 

 
   $         —      $ (229,895,145      $             —      $ (229,895,145
  

 

 

    

 

 

      

 

 

    

 

 

 

During the year ended April 30, 2018, there were no transfers between levels.

See notes to financial statements.

 

 

SCHEDULES OF INVESTMENTS      35  


Schedule of Investments  

April 30, 2018

  

BlackRock MuniHoldings Fund, Inc. (MHD)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  

Municipal Bonds — 117.4%

   
Alabama — 2.1%  

County of Jefferson Alabama Sewer, Refunding RB:

   

Senior Lien, Series A (AGM), 5.00%, 10/01/44

  $ 570     $ 620,673  

Senior Lien, Series A (AGM), 5.25%, 10/01/48

    1,090       1,198,520  

Sub-Lien, Series D, 6.00%, 10/01/42

    1,000       1,149,630  

Sub-Lien, Series D, 7.00%, 10/01/51

    1,545       1,864,058  
   

 

 

 
      4,832,881  
Arizona — 2.7%  

City of Phoenix Arizona IDA, RB, Legacy Traditional Schools Projects, Series A, 5.00%, 07/01/46(a)

    1,230       1,254,698  

Salt Verde Financial Corp., RB, Senior:

   

5.00%, 12/01/32

    2,000       2,320,360  

5.00%, 12/01/37

    2,360       2,755,749  
   

 

 

 
      6,330,807  
California — 12.2%  

California Health Facilities Financing Authority, RB:

   

St. Joseph Health System, Series A, 5.75%, 07/01/39

    1,530       1,597,810  

Sutter Health, Series B, 6.00%, 08/15/20(b)

    2,200       2,402,334  

California Health Facilities Financing Authority, Refunding RB, St. Joseph Health System, Series A, 5.00%, 07/01/33

    875       978,976  

California Municipal Finance Authority, RB, Senior, Caritas Affordable Housing, Inc. Projects, S/F Housing, Series A:

   

5.25%, 08/15/39

    105       114,539  

5.25%, 08/15/49

    265       287,215  

California Municipal Finance Authority, Refunding RB, Community Medical Centers, Series A, 5.00%, 02/01/42

    165       179,480  

California Pollution Control Financing Authority, RB, Poseidon Resources (Channel Side) LP Desalination Project, AMT, 5.00%, 11/21/45(a)

    2,200       2,331,978  

California Statewide Communities Development Authority, RB, Series A:

   

John Muir Health, 5.13%, 07/01/19(b)

    1,510       1,567,531  

Loma Linda University Medical Center,
5.00%, 12/01/46(a)

    330       347,457  

City of Los Angeles California Department of Airports, Refunding ARB, Los Angeles International Airport, Series A, 5.25%, 05/15/39

    555       574,098  

City of Stockton California Public Financing Authority, RB, Delta Water Supply Project, Series A, 6.25%, 10/01/38

    255       298,763  

Golden State Tobacco Securitization Corp., Refunding RB, Asset-Backed, Senior Series A-1, 5.75%, 06/01/47

    1,650       1,697,388  

Montebello Unified School District, GO, CAB (NPFGC), 0.00%, 08/01/22(c)

    2,405       2,123,735  

San Diego Unified School District California, GO, CAB, Election of 2008, Series A, 0.00%, 07/01/29(c)

    3,475       2,398,167  

State of California, GO, Various Purposes:

   

6.50%, 04/01/19(b)

    4,535       4,726,422  

6.50%, 04/01/33

    3,835       3,997,221  

State of California Public Works Board, LRB, Various Capital Projects:

   

Series I, 5.00%, 11/01/38

    550       611,551  

Sub-Series I-1, 6.38%, 11/01/19(b)

    820       875,932  

Tobacco Securitization Authority of Southern California, Refunding RB, Tobacco Settlement, Asset-Backed, Senior Series A-1, 4.75%, 06/01/25

    1,250       1,252,675  
   

 

 

 
      28,363,272  
Colorado — 2.2%  

Colorado Educational & Cultural Facilities Authority, RB, Charter School, Colorado Springs, 5.50%, 07/01/40

    1,455       1,507,365  

Regional Transportation District, COP, Refunding, Series A, 5.38%, 06/01/31

    710       753,644  
Security   Par
(000)
    Value  
Colorado (continued)  

Regional Transportation District, RB, Denver Transit Partners Eagle P3 Project, 6.00%, 01/15/34

  $ 1,425     $ 1,525,163  

University of Colorado, RB, Series A, 5.38%, 06/01/19(b)

    1,250       1,296,763  
   

 

 

 
      5,082,935  
Delaware — 1.8%  

County of Sussex Delaware, RB, NRG Energy, Inc., Indian River Power LLC Project, 6.00%, 10/01/40

    790       833,695  

Delaware Transportation Authority, RB, U.S. 301 Project, 5.00%, 06/01/55

    840       915,642  

State of Delaware EDA, RB, Exempt Facilities, Indian River Power LLC Project, 5.38%, 10/01/45

    2,430       2,519,934  
   

 

 

 
      4,269,271  
District of Columbia — 4.7%  

District of Columbia, Refunding RB, Georgetown University:

   

5.00%, 04/01/35

    315       357,616  

Issue, 5.00%, 04/01/42

    365       408,384  

District of Columbia, Tax Allocation Bonds, City Market at O Street Project, 5.13%, 06/01/41

    1,520       1,624,044  

Metropolitan Washington Airports Authority, Refunding ARB, Dulles Toll Road, CAB, 2nd Senior Lien, Series B (AGC), 0.00%, 10/01/35(c)

    13,485       6,606,167  

Metropolitan Washington Airports Authority, Refunding RB, Dulles Toll Road, 1st Senior Lien, Series A:

   

5.00%, 10/01/39

    505       522,776  

5.25%, 10/01/44

    1,470       1,526,198  
   

 

 

 
      11,045,185  
Florida — 4.9%  

City of Clearwater Florida Water & Sewer Revenue, RB, Series A, 5.25%, 12/01/19(b)

    2,375       2,499,402  

Country of Broward Florida Airport System, ARB, AMT, 5.00%, 10/01/47

    215       239,211  

County of Broward Florida Water & Sewer Utility, Refunding RB, Series A, 5.25%, 10/01/18(b)

    750       760,890  

County of Collier Florida Health Facilities Authority, Refunding RB, Series A, 5.00%, 05/01/45

    960       1,050,557  

County of Miami-Dade Florida Aviation, Refunding ARB, Miami International Airport, Series A-1, 5.38%, 10/01/41

    2,620       2,808,064  

Mid-Bay Florida Bridge Authority, RB, Springing Lien, Series A, 7.25%, 10/01/21(b)

    2,095       2,432,064  

Village Community Development District No.10, Special Assessment Bonds, 5.13%, 05/01/43

    1,410       1,555,047  
   

 

 

 
      11,345,235  
Georgia — 1.6%  

County of Dalton Whitfield Joint Development Authority, RB, Hamilton Health Care System Obligation, 4.00%, 08/15/48

    2,645       2,644,868  

County of Gainesville Georgia & Hall Hospital Authority, Refunding RB, Northeast Georgia Health System, Inc. Project, Series A, 5.50%, 08/15/54

    370       422,492  

DeKalb Georgia Private Hospital Authority, Refunding RB, Children’s Healthcare, 5.25%, 11/15/39

    585       612,980  
   

 

 

 
      3,680,340  
Hawaii — 0.4%  

State of Hawaii Harbor System, RB, Series A, 5.25%, 07/01/30

    945       1,004,516  
   

 

 

 
Idaho — 0.3%  

Idaho Health Facilities Authority, RB, Trinity Health Credit Group, Series A, 5.00%, 12/01/46

    540       604,314  
   

 

 

 
Illinois — 16.6%  

Chicago Board of Education, GO, Dedicated Revenues, Series H, 5.00%, 12/01/36

    350       348,309  
 

 

 

36    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniHoldings Fund, Inc. (MHD)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Illinois (continued)  

Chicago Board of Education, GO, Refunding Dedicated Revenues:

   

Series C, 5.00%, 12/01/30

  $ 605     $ 613,718  

Series F, 5.00%, 12/01/22

    455       479,898  

Series G, 5.00%, 12/01/34

    315       315,699  

City of Chicago Illinois, GO, Project, Series A, 5.00%, 01/01/34

    1,220       1,234,982  

City of Chicago Illinois, GO, Refunding, Project, Series A:

   

5.25%, 01/01/32

    2,195       2,271,935  

5.00%, 01/01/35

    2,000       2,032,380  

City of Chicago Illinois, Special Assessment Bonds, Lake Shore East Project, 6.75%, 12/01/32

    881       885,828  

City of Chicago Illinois O’Hare International Airport, GARB, 3rd Lien:

   

Series A, 5.75%, 01/01/21(b)

    1,680       1,837,080  

Series A, 5.75%, 01/01/39

    320       346,886  

Series C, 6.50%, 01/01/21(b)

    4,055       4,506,930  

City of Chicago Illinois Transit Authority, RB, Sales Tax Receipts, 5.25%, 12/01/40

    730       778,443  

City of Chicago Illinois Waterworks, Refunding RB, 2nd Lien Project, 5.00%, 11/01/42

    1,000       1,051,710  

County of Cook Illinois Community College District No. 508, GO, City College of Chicago, 5.50%, 12/01/38

    560       588,190  

Illinois Finance Authority, Refunding RB:

   

Central Dupage Health, Series B, 5.50%, 11/01/19(b)

    1,115       1,172,958  

Presence Health Network, Series C, 4.00%, 02/15/41

    1,035       1,024,257  

Metropolitan Pier & Exposition Authority, Refunding RB, McCormick Place Expansion Project:

   

CAB, Series B (AGM), 0.00%, 06/15/47(c)

    13,220       3,284,245  

Series B (AGM), 5.00%, 06/15/50

    3,070       3,197,651  

Series B-2, 5.00%, 06/15/50

    1,740       1,763,281  

Railsplitter Tobacco Settlement Authority, RB(b):

   

5.50%, 06/01/21

    315       346,484  

6.00%, 06/01/21

    800       891,824  

State of Illinois, GO:

   

5.00%, 02/01/39

    1,100       1,104,279  

Series A, 5.00%, 04/01/38

    2,625       2,636,235  

State of Illinois, RB, Build Illinois, Series B, 5.25%, 06/15/19(b)

    440       456,438  

State of Illinois Toll Highway Authority, RB:

   

Senior, Series C, 5.00%, 01/01/36

    1,870       2,058,702  

Senior, Series C, 5.00%, 01/01/37

    2,000       2,194,280  

Series A, 5.00%, 01/01/38

    415       452,180  

University of Illinois, RB, Auxiliary Facilities System, Series A, 5.00%, 04/01/44

    705       755,971  
   

 

 

 
      38,630,773  
Indiana — 4.4%  

City of Valparaiso Indiana, RB, Exempt Facilities, Pratt Paper LLC Project, AMT:

   

6.75%, 01/01/34

    560       653,682  

7.00%, 01/01/44

    1,355       1,589,822  

Indiana Finance Authority, RB, Series A:

   

CWA Authority Project, 1st Lien, 5.25%, 10/01/38

    2,275       2,480,797  

Private Activity Bond, Ohio River Bridges East End Crossing Project, AMT, 5.00%, 07/01/44

    310       330,119  

Private Activity Bond, Ohio River Bridges East End Crossing Project, AMT, 5.00%, 07/01/48

    1,030       1,093,860  

Private Activity Bond, Ohio River Bridges East End Crossing Project, AMT, 5.25%, 01/01/51

    290       310,938  

Sisters of St. Francis Health Services,
5.25%, 11/01/19(b)

    585       613,261  

Indiana Finance Authority, Refunding RB, Parkview Health System, Series A:

   

5.75%, 05/01/19(b)

    1,065       1,104,235  

5.75%, 05/01/31

    235       243,991  
Security   Par
(000)
    Value  
Indiana (continued)  

Indiana Municipal Power Agency, RB, Series B, 6.00%, 01/01/19(b)

  $ 775     $ 796,150  

Indianapolis Local Public Improvement Bond Bank, RB, Series A, 5.00%, 01/15/40

    880       966,750  
   

 

 

 
      10,183,605  
Iowa — 1.8%  

Iowa Finance Authority, Refunding RB, Iowa Fertilizer Co. Project:

   

Series B, 5.25%, 12/01/50

    1,955       2,053,356  

Midwestern Disaster Area, 5.50%, 12/01/22

    5       5,073  

Midwestern Disaster Area, 5.25%, 12/01/25

    320       340,477  

Midwestern Disaster Area, 5.88%, 12/01/26(a)

    285       300,461  

Iowa Student Loan Liquidity Corp., Refunding RB, Student Loan, Senior Series A-1, AMT, 5.15%, 12/01/22

    575       593,107  

Iowa Tobacco Settlement Authority, Refunding RB, Asset-Backed, Series C, 5.63%, 06/01/46

    980       985,047  
   

 

 

 
      4,277,521  
Kansas — 0.7%  

Kansas Development Finance Authority, Refunding RB, Adventist Health System/Sunbelt Obligated Group, Series C:

   

5.75%, 11/15/19(b)

    35       36,915  

5.75%, 11/15/38

    1,485       1,569,972  
   

 

 

 
      1,606,887  
Kentucky — 0.7%  

Kentucky Economic Development Finance Authority, RB, Catholic Health Initiatives, Series A, 5.25%, 01/01/45

    705       748,893  

Kentucky Public Transportation Infrastructure Authority, RB, Downtown Crossing Project, Convertible CAB, 1st Tier, Series C, 0.00%, 07/01/43(d)

    865       799,390  
   

 

 

 
      1,548,283  
Louisiana — 1.9%  

East Baton Rouge Sewerage Commission, RB, Series A, 5.25%, 02/01/19(b)

    570       584,729  

New Orleans Aviation Board, RB, Passenger Facility Charge, Series A, 5.25%, 01/01/41

    430       449,066  

Tobacco Settlement Financing Corp., Refunding RB, Asset-Backed, Series A:

   

5.50%, 05/15/30

    700       746,179  

5.25%, 05/15/31

    600       644,850  

5.25%, 05/15/32

    765       830,874  

5.25%, 05/15/33

    830       894,591  

5.25%, 05/15/35

    350       378,556  
   

 

 

 
      4,528,845  
Maine — 0.1%  

Maine Health & Higher Educational Facilities Authority, RB, Series A:

   

5.00%, 07/01/19(b)

    65       67,292  

5.00%, 07/01/39

    145       149,179  
   

 

 

 
      216,471  
Maryland — 1.2%  

Maryland EDC, RB, Transportation Facilities Project, Series A, 5.75%, 06/01/20(b)

    300       322,617  

Maryland EDC, Refunding RB, CNX Marine Terminals, Inc., 5.75%, 09/01/25

    530       552,933  

Maryland Health & Higher Educational Facilities Authority, RB, Trinity Health Credit Group, Series 2017, 5.00%, 12/01/46

    305       343,351  

Maryland Health & Higher Educational Facilities Authority, Refunding RB, Charlestown Community Project, 6.25%, 01/01/21(b)

    1,520       1,677,548  
   

 

 

 
      2,896,449  
 

 

 

SCHEDULES OF INVESTMENTS      37  


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniHoldings Fund, Inc. (MHD)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Massachusetts — 1.4%  

Massachusetts Development Finance Agency, Refunding RB:

   

Boston University, Series P, 5.45%, 05/15/59

  $ 1,165     $ 1,366,033  

Covanta Energy Project, Series C, AMT,
5.25%, 11/01/42(a)

    1,575       1,575,945  

Massachusetts Health & Educational Facilities Authority, Refunding RB, Partners Healthcare System, Series J1, 5.00%, 07/01/19(b)

    255       263,991  
   

 

 

 
      3,205,969  
Michigan — 3.1%            

City of Detroit Michigan Sewage Disposal System, Refunding RB, Senior Lien, Series A, 5.25%, 07/01/39

    3,085       3,298,513  

Kalamazoo Hospital Finance Authority, Refunding RB, Bronson Methodist Hospital:

   

5.50%, 05/15/20(b)

    530       565,950  

5.50%, 05/15/36

    425       447,810  

Michigan Finance Authority, Refunding RB, Detroit Water & Sewage Department Project, Senior Lien, Series C-1, 5.00%, 07/01/44

    630       681,257  

Michigan State Hospital Finance Authority, Refunding RB, Henry Ford Health System, 5.75%, 11/15/19(b)

    2,105       2,225,132  
   

 

 

 
      7,218,662  
Minnesota — 0.9%        

City of Minneapolis Minnesota, Refunding RB, Fairview Health Services, Series A, 6.75%, 11/15/18(b)

    2,135       2,191,471  
   

 

 

 
Mississippi — 0.3%        

University of Southern Mississippi, RB, Campus Facilities Improvements Project, 5.38%, 09/01/19(b)

    675       706,205  
   

 

 

 
Missouri — 1.1%        

Bi-State Development Agency of the Missouri-Illinois Metropolitan District, Refunding RB, Combined Lien, Series A, 5.00%, 10/01/44

    175       192,174  

State of Missouri Health & Educational Facilities Authority, Refunding RB:

   

Mercy Health, Series C, 5.00%, 11/15/47

    1,905       2,112,150  

St. Louis College of Pharmacy Project, 5.50%, 05/01/43

    175       187,684  
   

 

 

 
      2,492,008  
Nebraska — 0.3%        

Central Plains Nebraska Energy Project, RB, Gas Project No. 3, 5.25%, 09/01/37

    575       631,810  
   

 

 

 
New Hampshire — 1.4%        

New Hampshire Health & Education Facilities Authority, Refunding RB, Dartmouth-Hitchcock, 6.00%, 08/01/19(b)

    3,035       3,186,386  
   

 

 

 
New Jersey — 7.8%        

Casino Reinvestment Development Authority, Refunding RB:

   

5.25%, 11/01/39

    735       778,755  

5.25%, 11/01/44

    1,095       1,160,426  

County of Essex New Jersey Improvement Authority, RB, AMT, 5.25%, 07/01/45(a)

    775       782,192  

New Jersey EDA, RB, Continental Airlines, Inc. Project, AMT:

   

5.13%, 09/15/23

    1,410       1,522,053  

5.25%, 09/15/29

    1,365       1,480,970  

New Jersey EDA, Refunding ARB, Port Network Container Terminal LLC Project, AMT, 5.00%, 10/01/47

    1,060       1,130,437  

New Jersey EDA, Refunding, Special Assessment Bonds, Kapkowski Road Landfill Project, 5.75%, 04/01/31

    1,550       1,716,454  

New Jersey State Turnpike Authority, RB:

   

Series A, 5.00%, 07/01/22(b)

    1,210       1,344,576  

Series A, 5.00%, 01/01/43

    715       774,638  

Series E, 5.00%, 01/01/45

    1,875       2,055,975  
Security   Par
(000)
    Value  
New Jersey (continued)        

New Jersey Transportation Trust Fund Authority, RB:

   

Transportation Program, Series AA, 5.00%, 06/15/44

  $ 315     $ 328,287  

Transportation Program, Series AA, 5.00%, 06/15/44

    580       604,401  

Transportation System, Series A, 5.50%, 06/15/41

    1,575       1,643,087  

Transportation System, Series B, 5.25%, 06/15/36

    1,705       1,772,927  

Tobacco Settlement Financing Corp., Refunding RB:

   

Series A, 5.25%, 06/01/46

    390       433,146  

Sub-Series B, 5.00%, 06/01/46

    550       577,071  
   

 

 

 
      18,105,395  
New York — 8.3%        

City of New York New York Transitional Finance Authority Future Tax Secured, RB, Fiscal 2012, Sub-Series E-1, 5.00%, 02/01/42

    310       334,775  

Counties of New York Tobacco Trust IV, Refunding RB, Settlement Pass-Through Turbo, Series A,
6.25%, 06/01/41(a)

    1,300       1,353,820  

County of Dutchess New York Industrial Development Agency, Refunding RB, Bard College Civic Facility, Series A-1, 5.00%, 08/01/46

    1,800       1,703,592  

County of Westchester New York Healthcare Corp., RB, Senior Lien, Series A, 5.00%, 11/01/44

    233       247,577  

Erie Tobacco Asset Securitization Corp., Refunding RB, Asset-Backed, Series A, 5.00%, 06/01/45

    1,405       1,374,343  

Hudson Yards Infrastructure Corp., Refunding RB, Series A, 5.00%, 02/15/39

    680       769,733  

Long Island Power Authority, Refunding RB, Electric System, Series A, 5.75%, 04/01/19(b)

    1,450       1,501,258  

Metropolitan Transportation Authority, RB, Series B, 5.25%, 11/15/38

    1,715       1,934,657  

Metropolitan Transportation Authority, Refunding RB, Dedicated Tax Fund, Series B, 5.00%, 11/15/19(b)

    1,740       1,823,972  

Metropolitan Transportation Authority Hudson Rail Yards Trust Obligations, Refunding RB, Series A, 5.00%, 11/15/56

    765       822,283  

New York Counties Tobacco Trust IV, Refunding RB, Tobacco Settlement Pass-Through Bonds, Series A,
5.00%, 06/01/38

    1,415       1,406,071  

New York Liberty Development Corp., Refunding RB:

   

2nd Priority, Bank of America Tower at One Bryant Park Project, Class 3, 6.38%, 07/15/49

    850       899,122  

3 World Trade Center Project, Class 1, 5.00%, 11/15/44(a)

    2,275       2,389,978  

3 World Trade Center Project, Class 2, 5.15%, 11/15/34(a)

    245       266,572  

3 World Trade Center Project, Class 2, 5.38%, 11/15/40(a)

    605       658,954  

Port Authority of New York & New Jersey, ARB, Special Project, JFK International Air Terminal LLC Project, Series 8:

   

6.00%, 12/01/36

    900       985,563  

6.00%, 12/01/42

    875       956,795  
   

 

 

 
      19,429,065  
North Carolina — 0.6%        

North Carolina Medical Care Commission, RB, Health Care Facilities, Duke University Health System, Series A, 5.00%, 06/01/19(b)

    970       1,002,951  

North Carolina Medical Care Commission, Refunding RB, 1st Mortgage, Retirement Facilities Whitestone Project, Series A, 7.75%, 03/01/21(b)

    415       476,988  
   

 

 

 
      1,479,939  
Ohio — 1.7%        

Buckeye Tobacco Settlement Financing Authority, RB, Asset-Backed, Senior Turbo Term, Series A-2, 5.88%, 06/01/47

    2,570       2,569,974  

County of Franklin Ohio, RB:

   

Health Care Facilities Improvement, OPRS Communities Obligation Group, Series A, 6.13%, 07/01/40

    470       512,258  

Trinity Health Credit Group, Series 2017, 5.00%, 12/01/46

    290       324,539  
 

 

 

38    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniHoldings Fund, Inc. (MHD)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Ohio (continued)        

State of Ohio, RB, Portsmouth Bypass Project, AMT, 5.00%, 06/30/53

  $ 580     $ 631,974  
   

 

 

 
      4,038,745  
Oklahoma — 1.0%        

Oklahoma Development Finance Authority, RB, OU Medicine Project, Series B, 5.25%, 08/15/48

    855       936,037  

Oklahoma Turnpike Authority, RB, 2nd Series C, 4.00%, 01/01/42

    1,420       1,452,333  
   

 

 

 
      2,388,370  
Pennsylvania — 4.0%        

City of Philadelphia Pennsylvania Airport Revenue, Refunding ARB, AMT, Series B, 5.00%, 07/01/47

    330       363,878  

City of Philadelphia Pennsylvania Hospitals & Higher Education Facilities Authority, RB, Temple University Health System, Series A, 5.63%, 07/01/42

    460       497,177  

Commonwealth Financing Authority, RB, Tobacco Master Settlement Payment:

   

5.00%, 06/01/33

    75       83,876  

5.00%, 06/01/34

    100       111,119  

County of Montgomery Higher Education & Health Authority, Refunding RB, Thomas Jefferson University, Series A:

   

4.00%, 09/01/49

    415       408,418  

5.00%, 09/01/43

    905       1,005,184  

Pennsylvania Economic Development Financing Authority, RB:

   

American Water Co. Project, 6.20%, 04/01/39

    2,520       2,611,123  

AMT, 5.00%, 06/30/42

    2,015       2,156,916  

Pennsylvania Economic Development Financing Authority, Refunding RB, National Gypsum Co., AMT, 5.50%, 11/01/44

    1,105       1,161,576  

Pennsylvania Turnpike Commission, RB, Series A, 5.00%, 12/01/44

    795       865,016  
   

 

 

 
      9,264,283  
Puerto Rico — 1.1%        

Children’s Trust Fund, Refunding RB, Tobacco Settlement Asset-Backed Bonds:

   

5.50%, 05/15/39

    1,345       1,312,236  

5.63%, 05/15/43

    1,280       1,224,077  
   

 

 

 
      2,536,313  
Rhode Island — 2.2%        

Tobacco Settlement Financing Corp., Refunding RB:

   

Series A, 5.00%, 06/01/35

    580       623,581  

Series B, 4.50%, 06/01/45

    1,900       1,919,456  

Series B, 5.00%, 06/01/50

    2,605       2,668,849  
   

 

 

 
      5,211,886  
South Carolina — 3.6%        

State of South Carolina Ports Authority, ARB:

   

5.25%, 07/01/40

    2,285       2,421,437  

AMT, 5.25%, 07/01/55

    925       1,021,810  

State of South Carolina Public Service Authority, RB, Santee Cooper, Series A, 5.50%, 12/01/54

    2,385       2,603,204  

State of South Carolina Public Service Authority, Refunding RB, Series E, 5.25%, 12/01/55

    2,260       2,458,496  
   

 

 

 
      8,504,947  
Tennessee — 0.7%        

City of Chattanooga Health Educational & Housing Facility Board, RB, Catholic Health Initiatives, Series A, 5.25%, 01/01/45

    980       1,041,015  

County of Nashville & Davidson Metropolitan Government Health & Educational Facilities Board, RB, Vanderbilt University Medical Center, Series A, 5.00%, 07/01/40

    495       543,985  
   

 

 

 
      1,585,000  
Security   Par
(000)
    Value  
Texas — 9.1%        

Central Texas Regional Mobility Authority, Refunding RB:

   

Senior Lien, 6.25%, 01/01/21(b)

  $ 1,480     $ 1,633,402  

Sub-Lien, 5.00%, 01/01/33

    250       269,680  

City of Austin Texas Airport System, ARB, AMT, 5.00%, 11/15/39

    440       477,721  

City of Austin Texas Electric Utility Revenue, Refunding RB, Series A, 5.00%, 11/15/37

    1,500       1,643,670  

City of Dallas Texas Waterworks & Sewer System Revenue, Refunding RB, 5.00%, 10/01/20(b)

    485       517,927  

City of Houston Texas Airport System, Refunding ARB, Senior Lien, Series A, 5.50%, 07/01/39

    1,070       1,076,249  

County of Harris Texas Cultural Education Facilities Finance Corp., RB, 1st Mortgage, Brazos Presbyterian Homes, Inc. Project, Series B, 7.00%, 01/01/23(b)

    325       390,419  

County of Harris Texas Health Facilities Development Corp., Refunding RB, Memorial Hermann Healthcare System, Series B, 7.25%, 12/01/18(b)

    1,910       1,969,917  

Dallas-Fort Worth Texas International Airport, Refunding ARB, AMT, Series E, 5.00%, 11/01/32

    3,065       3,237,927  

La Vernia Higher Education Finance Corp., RB, Kipp, Inc., Series A, 6.38%, 08/15/19(b)

    450       474,975  

North Texas Tollway Authority, RB, CAB, Special Project System, Series B, 0.00%, 09/01/31(b)(c)

    1,400       593,208  

San Antonio Water System, Refunding RB, Junior Lien, Series A, 5.00%, 05/15/48(e)

    1,825       2,074,842  

Texas Private Activity Bond Surface Transportation Corp., RB, Senior Lien:

   

LBJ Infrastructure Group LLC, 7.00%, 06/30/40

    2,000       2,194,760  

NTE Mobility Partners LLC, North Tarrant Express Managed Lanes Project, 6.88%, 12/31/39

    1,700       1,827,636  

University of Texas System, Refunding RB, Permanent University Fund, Series B, 4.00%, 07 /01/47

    2,725       2,816,996  
   

 

 

 
      21,199,329  
Utah — 0.3%        

Salt Lake City Corp. Airport Revenue, ARB, Series A, AMT, 5.00%, 07/01/47

    665       738,190  
   

 

 

 
Virginia — 2.2%        

County of Hanover Virginia EDA, Refunding RB, Covenant Woods, Series A:

   

5.00%, 07/01/42

    625       643,400  

Residential Care Facility, 5.00%, 07/01/47

    970       996,326  

Hampton Roads Transportation Accountability Commission, RB, Transportation Fund, Senior Lien, Series A,
5.50%, 07/01/57

    810       957,857  

Virginia Small Business Financing Authority, RB, Senior Lien, Elizabeth River Crossings OpCo LLC Project, AMT:

   

5.25%, 01/01/32

    550       597,630  

6.00%, 01/01/37

    1,830       2,036,479  
   

 

 

 
      5,231,692  
Washington — 2.3%        

Grant County Public Utility District No. 2, Refunding RB, Series A, 5.00%, 01/01/43

    1,555       1,727,092  

Port of Seattle Washington, ARB, Intermediate Lien, Series C, AMT, 5.00%, 05/01/42

    1,085       1,214,126  

Port of Seattle Washington, RB, Intermediate Lien, Series C, AMT, 5.00%, 04/01/40

    540       582,298  

Washington Health Care Facilities Authority, RB, Catholic Health Initiatives, Series A, 5.75%, 01/01/45

    1,625       1,771,494  
   

 

 

 
      5,295,010  
Wisconsin — 3.6%        

State of Wisconsin, Refunding RB, Series A,
6.00%, 05/01/19(b)

    4,980       5,185,773  
 

 

 

SCHEDULES OF INVESTMENTS      39  


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniHoldings Fund, Inc. (MHD)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Wisconsin (continued)        

State of Wisconsin Health & Educational Facilities Authority, RB, Ascension Health Senior Credit Group, Series E, 5.00%,11/15/33

  $ 1,710     $ 1,783,496  

Wisconsin Health & Educational Facilities Authority, Refunding RB, Medical College of Wisconsin, Inc., 4.00%, 12/01/46

    1,305       1,314,357  
   

 

 

 
      8,283,626  
Wyoming — 0.1%        

Wyoming Municipal Power Agency, Inc., RB, Series A, 5.00%, 01/01/19(b)

    210       214,353  
   

 

 

 

Total Municipal Bonds — 117.4%
(Cost — $255,939,142)

 

    273,586,244  
   

 

 

 

Municipal Bonds Transferred to Tender Option Bond Trusts(f)

 

California — 9.1%        

Bay Area Toll Authority, Refunding RB, San Francisco Bay Area:

   

Toll Bridge, 4.00%, 04/01/42(g)

    2,257       2,336,210  

Series F-1, 5.63%, 04/01/19(b)

    2,271       2,350,852  

California Educational Facilities Authority, RB, University of Southern California, Series B, 5.25%, 10/01/18(b)(g)

    1,844       1,871,025  

City & County of San Francisco California Public Utilities Commission, RB, Water Revenue, Series B, 5.00%, 11/01/19(b)

    6,600       6,911,080  

City of Los Angeles California Department of Airports, Refunding ARB, Los Angeles International Airport, Senior Series A, 5.00%, 05/15/40

    4,121       4,369,859  

Sacramento Area Flood Control Agency, Refunding, Consolidated Capital Assessment District No. 2 Bonds, 5.00%, 10/01/47

    2,250       2,553,251  

San Diego California Community College District, GO, Election of 2002, 5.25%, 08/01/19(b)

    748       779,603  
   

 

 

 
      21,171,880  
Colorado — 2.6%        

Colorado Health Facilities Authority, RB, Catholic Health, Series C-7 (AGM), 5.00%, 09/01/36

    1,650       1,650,000  

Colorado Health Facilities Authority, Refunding RB, Catholic Health Initiatives, Series A, 5.50%, 07/01/34(g)

    1,490       1,536,771  

County of Adams Colorado, COP, Refunding,
4.00%, 12/01/45

    2,700       2,758,145  
   

 

 

 
      5,944,916  
Florida — 1.8%  

County of Miami-Dade Florida, RB, Water & Sewer System, 5.00%, 10/01/20(b)

    3,939       4,213,881  
   

 

 

 
Georgia — 1.0%  

Private Colleges & Universities Authority, Refunding RB, Emory University, Series C, 5.00%, 09/01/18(b)

    2,259       2,283,313  
   

 

 

 
Massachusetts — 2.7%  

Commonwealth of Massachusetts Transportation Fund Revenue, RB, Rail Enhancement Program, Series A, 4.00%, 06/01/45

    1,502       1,533,301  

Massachusetts School Building Authority, RB, Senior, Series B, 5.00%, 10/15/41

    4,502       4,845,606  
   

 

 

 
      6,378,907  
New Hampshire — 0.6%  

New Hampshire Health & Education Facilities Authority, RB, Dartmouth College, 5.25%, 06/01/19(b)(g)

    1,410       1,460,259  
   

 

 

 
New York — 9.1%  

City of New York New York Municipal Water Finance Authority, Refunding RB, Water & Sewer System, 2nd General Resolution, Series FF-2, 5.50%, 06/15/40

    1,110       1,154,529  

Hudson Yards Infrastructure Corp., RB, Fiscal 2012, Series A, 5.75%, 02/15/47(g)

    1,110       1,211,512  
Security   Par
(000)
    Value  
New York (continued)  

Metropolitan Transportation Authority, Refunding RB, Series C-1, 5.25%, 11/15/56

  $ 3,240     $ 3,649,885  

New York Liberty Development Corp., ARB, 1 World Trade Center Port Authority Consolidated Bonds,
5.25%, 12/15/43

    7,440       8,105,523  

New York Liberty Development Corp., Refunding RB, 4 World Trade Center Project, 5.75%, 11/15/51(g)

    4,460       4,935,233  

Port Authority of New York & New Jersey, Refunding ARB, 194th Series, 5.25%, 10/15/55

    1,860       2,081,718  
   

 

 

 
      21,138,400  
North Carolina — 1.4%  

North Carolina Capital Facilities Finance Agency, Refunding RB:

   

Duke University Project, Series B, 5.00%, 10/01/55

    1,830       2,038,950  

Wake Forest University, 5.00%, 01/01/19(b)

    1,080       1,102,469  
   

 

 

 
      3,141,419  
Ohio — 4.2%  

State of Ohio, Refunding RB, Cleveland Clinic Health System Obligated Group, Series A, 5.50%, 01/01/19(b)

    9,644       9,873,226  
   

 

 

 
Pennsylvania — 0.8%  

Pennsylvania Turnpike Commission, RB, Sub-Series A, 5.50%, 12/01/42

    1,695       1,930,221  
   

 

 

 
Rhode Island — 0.5%  

Narragansett Bay Commission, Refunding RB, Wastewater System, Series A, 4.00%, 09/01/43

    1,140       1,151,582  
   

 

 

 
Texas — 6.5%  

City of San Antonio Texas Electric and Gas Systems, RB, Junior Lien, 5.00%, 02/01/43

    1,720       1,855,858  

County of Harris Texas, RB, Toll Road, Senior Lien, Series A(g):

   

5.00%, 08/15/19(b)

    2,620       2,711,030  

5.00%, 08/15/38

    2,004       2,073,704  

County of Harris Texas Metropolitan Transit Authority, Refunding RB, Series A, 5.00%, 11/01/41

    2,350       2,536,590  

Lower Colorado River Authority, Refunding RB, LCRA Transmission Services Corporation Project,
4.00%, 05/15/43

    1,504       1,512,084  

San Antonio Public Facilities Corp., Refunding RB, Convention Center Refinancing and Expansion Project,
4.00%, 09/15/42

    2,295       2,314,056  

University of Texas, Refunding RB, Financing System, Series B, 5.00%, 08/15/43

    2,041       2,241,912  
   

 

 

 
      15,245,234  
Utah — 1.1%            

City of Riverton Utah, RB, IHC Health Services, Inc., 5.00%, 08/15/41

    2,519       2,612,784  
   

 

 

 
Virginia — 2.6%            

University of Virginia, Refunding RB, General,
5.00%, 06/01/18(b)

    3,749       3,758,955  

Virginia Small Business Financing Authority, Refunding RB, Sentara Healthcare, 5.00%, 11/01/40

    2,095       2,203,516  
   

 

 

 
      5,962,471  
Wisconsin — 1.8%            

Wisconsin Health & Educational Facilities Authority, Refunding RB, Froedtert & Community Health, Inc., Obligated Group, Series C, 5.25%, 04/01/19(b)(g)

    3,959       4,080,812  
   

 

 

 

Total Municipal Bonds Transferred to Tender Option Bond Trusts — 45.8%
(Cost — $103,402,483)

 

    106,589,305  
   

 

 

 

Total Long-Term Investments — 163.2%
(Cost — $359,341,625)

 

    380,175,549  
   

 

 

 
 

 

 

40    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniHoldings Fund, Inc. (MHD)

(Percentages shown are based on Net Assets)

 

Security       
Shares
    Value  

Short-Term Securities — 0.3%

   

BlackRock Liquidity Funds, MuniCash, Institutional
Class, 1.48%(h)(i)

    733,990     $ 733,990  
   

 

 

 

Total Short-Term Securities — 0.3%
(Cost — $733,990)

 

    733,990  
   

 

 

 

Total Investments — 163.5%
(Cost — $360,075,615)

 

    380,909,539  

Liabilities in Excess of Other Assets — (0.4)%

 

    (887,625

Liability for TOB Trust Certificates, Including Interest Expense and Fees Payable — (27.2)%

 

    (63,400,554

VMTP Shares at Liquidation Value — (35.9)%

 

    (83,700,000
   

 

 

 

Net Assets Applicable to Common Shares — 100.0%

 

  $ 232,921,360  
   

 

 

 
(a)  Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors.
(b)  U.S. Government securities, held in escrow, are used to pay interest on this security, as well as to retire the bond in full at the date indicated, typically at a premium to par.
(c)  Zero-coupon bond.
(d)  Step-up bond that pays an initial coupon rate for the first period and then a higher coupon rate for the following periods. Rate as of period end.
(e)  When-issued security.
(f)  Represent bonds transferred to a TOB Trust in exchange of cash and residual certificates received by the Fund. These bonds serve as collateral in a secured borrowing. See Note 4 of the Notes to Financial Statements for details.
(g) All or a portion of security is subject to a recourse agreement. The aggregate maximum potential amount the Fund could ultimately be required to pay under the agreements, which expire between May 7, 2018 to February 15, 2031, is $13,416,493. See Note 4 of the Notes to Financial Statements for details.
(h) Annualized 7-day yield as of period end.
 
(i) During the year ended April 30, 2018, investments in issuers considered to be an affiliate of the Fund for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliated    Shares
Held at
04/30/17
     Net
Activity
     Shares
Held at
04/30/18
     Value at
04/30/18
     Income      Net
Realized

Gain (Loss) (a)
     Change in
Unrealized

Appreciation
(Depreciation)
 

BlackRock Liquidity Funds, MuniCash, Institutional Class

     575,572        158,418        733,990      $ 733,990      $ 25,710      $ 522      $ (57
           

 

 

    

 

 

    

 

 

    

 

 

 

 

  (a) Includes net capital gain distributions, if applicable.  

Derivative Financial Instruments Outstanding as of Period End

Futures Contracts

 

Description    Number of
Contracts
       Expiration
Date
       Notional
Amount (000)
       Value/
Unrealized
Appreciation
(Depreciation)
 

Short Contracts:

                 

10-Year U.S. Treasury Note

     22          06/20/18        $ 2,632        $ 13,233  

Long U.S. Treasury Bond

     50          06/20/18          7,192          (6,182

5-Year U.S. Treasury Note

     11          06/29/18          1,249          5,542  
                 

 

 

 
                  $ 12,593  
                 

 

 

 

Derivative Financial Instruments Categorized by Risk Exposure

As of year end, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:

 

      Commodity
Contracts
     Credit
Contracts
     Equity
Contracts
     Foreign
Currency
Exchange
Contracts
     Interest
Rate
Contracts
     Other
Contracts
     Total  

Assets — Derivative Financial Instruments

                    

Futures contracts

                    

Net unrealized appreciation(a)

   $      $      $      $      $ 18,775      $      $ 18,775  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Liabilities — Derivative Financial Instruments

                    

Futures contracts

                    

Net unrealized depreciation(a)

   $      $      $      $      $ 6,182      $      $ 6,182  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

  (a) Includes cumulative appreciation (depreciation) on futures contracts, if any, as reported in the Schedule of Investments. Only current day’s variation margin is reported within the Statements of Assets and Liabilities.  

 

 

SCHEDULES OF INVESTMENTS      41  


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniHoldings Fund, Inc. (MHD)

 

For the year ended April 30, 2018, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

      Commodity
Contracts
     Credit
Contracts
     Equity
Contracts
     Foreign
Currency
Exchange
Contracts
     Interest
Rate
Contracts
     Other
Contracts
     Total  

Net Realized Gain (Loss) from:

                    

Futures contracts

   $      $      $      $      $ 547,023      $      $ 547,023  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
Net Change in Unrealized Appreciation (Depreciation) on:                                                 

Futures contracts

   $      $      $      $      $ 250,959      $      $ 250,959  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

Futures contracts:

        

Average notional value of contracts — short

   $ 15,398,434  

For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.

Fair Value Hierarchy as of Period End

Various inputs are used in determining the fair value of investments and derivative financial instruments. For information about the Fund’s policy regarding valuation of investments and derivative financial instruments, refer to the Notes to Financial Statements.

The following tables summarize the Fund’s investments and derivative financial instruments categorized in the disclosure hierarchy:

 

      Level 1        Level 2        Level 3        Total  

Assets:

 

Investments:

 

Long-Term Investments(a)

   $        $ 380,175,549        $        $ 380,175,549  

Short-Term Securities

     733,990                            733,990  
  

 

 

      

 

 

      

 

 

      

 

 

 
   $ 733,990        $ 380,175,549        $        $ 380,909,539  
  

 

 

      

 

 

      

 

 

      

 

 

 

Derivative Financial Instruments(b)

 

Assets:

 

Interest rate contracts

   $ 18,775        $        $        $ 18,775  

Liabilities:

 

Interest rate contracts

     (6,182                          (6,182
  

 

 

      

 

 

      

 

 

      

 

 

 
   $ 12,593        $        $               —        $ 12,593  
  

 

 

      

 

 

      

 

 

      

 

 

 

 

  (a) See above Schedule of Investments for values in each state or political subdivision.  
  (b) Derivative financial instruments are futures contracts which are valued at the unrealized appreciation (depreciation) on the instrument.  

The Fund may hold assets and/or liabilities in which the fair value approximates the carrying amount for financial statement purposes. As of year end, such assets and/or liabilities are categorized within the disclosure hierarchy as follows:

 

      Level 1      Level 2        Level 3        Total  

Liabilities:

 

TOB Trust Certificates

   $      $ (63,165,719      $        $ (63,165,719

VMTP Shares at Liquidation Value

            (83,700,000                 (83,700,000
  

 

 

    

 

 

      

 

 

      

 

 

 
   $         —      $ (146,865,719      $               —        $ (146,865,719
  

 

 

    

 

 

      

 

 

      

 

 

 

During the year ended April 30, 2018, there were no transfers between levels.

See notes to financial statements.

 

 

42    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  

April 30, 2018

  

BlackRock MuniHoldings Fund II, Inc. (MUH)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  

Municipal Bonds — 111.0%

 

Alabama — 1.3%  

County of Jefferson Alabama Sewer, Refunding RB, Sub-Lien, Series D, 6.00%, 10/01/42

  $ 1,875     $ 2,155,556  
   

 

 

 
Arizona — 1.1%  

City of Phoenix Arizona IDA, RB, Legacy Traditional Schools Projects, Series A, 5.00%, 07/01/46(a)

    890       907,871  

Salt Verde Financial Corp., RB, Senior, 5.00%, 12/01/37

    810       945,829  
   

 

 

 
      1,853,700  
California — 14.3%  

Benicia Unified School District, GO, CAB, Series A (NPFGC), 0.00%, 08/01/20(b)

    2,000       1,910,400  

California Health Facilities Financing Authority, RB:

   

St. Joseph Health System, Series A, 5.75%, 07/01/39

    1,110       1,159,195  

Sutter Health, Series B, 6.00%, 08/15/20(c)

    1,585       1,730,772  

California Health Facilities Financing Authority, Refunding RB, St. Joseph Health System, Series A, 5.00%, 07/01/33

    445       497,879  

California Municipal Finance Authority, RB, Senior, Caritas Affordable Housing, Inc. Projects, S/F Housing, Series A:

   

5.25%, 08/15/39

    80       87,268  

5.25%, 08/15/49

    195       211,347  

California Municipal Finance Authority, Refunding RB, Community Medical Centers, Series A, 5.00%, 02/01/42

    120       130,531  

California Pollution Control Financing Authority, RB, Poseidon Resources (Channel Side) LP Desalination Project, AMT, 5.00%, 11/21/45(a)

    730       773,793  

California Statewide Communities Development Authority, RB, Series A:

   

John Muir Health, 5.13%, 07/01/19(c)

    1,090       1,131,529  

Loma Linda University Medical Center, 5.00%, 12/01/46(a)

    235       247,431  

City of Los Angeles California Department of Airports, Refunding ARB, Los Angeles International Airport, Series A, 5.25%, 05/15/39

    400       413,764  

City of Stockton California Public Financing Authority, RB, Delta Water Supply Project, Series A, 6.25%, 10/01/38

    185       216,750  

Golden State Tobacco Securitization Corp., Refunding RB, Asset-Backed, Senior Series A-1, 5.75%, 06/01/47

    1,190       1,224,177  

San Diego Unified School District California, GO, CAB, Election of 2008, Series A, 0.00%, 07/01/29(b)

    2,525       1,742,553  

San Marino Unified School District, GO, Series A (NPFGC), 0.00%, 07/01/19(b)

    2,070       2,026,116  

State of California, GO, Various Purposes:

   

6.50%, 04/01/19(c)

    3,965       4,132,363  

6.00%, 03/01/33

    1,265       1,361,646  

6.50%, 04/01/33

    3,360       3,502,128  

State of California Public Works Board, LRB, Various Capital Projects:

   

Series I, 5.00%, 11/01/38

    405       450,324  

Sub-Series I-1, 6.38%, 11/01/19(c)

    600       640,926  

Tobacco Securitization Authority of Southern California, Refunding RB, Tobacco Settlement, Asset-Backed, Senior Series A-1, 4.75%, 06/01/25

    935       937,001  
   

 

 

 
      24,527,893  
Colorado — 1.5%  

Colorado Educational & Cultural Facilities Authority, RB, Charter School, Colorado Springs, 5.50%, 07/01/40

    1,055       1,092,969  

Regional Transportation District, COP, Refunding, Series A, 5.38%, 06/01/31

    510       541,350  

University of Colorado, RB, Series A, 5.38%, 06/01/19(c)

    920       954,417  
   

 

 

 
      2,588,736  
Security   Par
(000)
    Value  
Connecticut — 0.3%  

Connecticut Housing Finance Authority, Refunding RB, S/F Housing:

   

Sub-Series A-1, 3.85%, 11/15/43

  $ 285     $ 281,344  

Sub-Series B-1, 4.00%, 05/15/45

    265       265,996  
   

 

 

 
      547,340  
Delaware — 2.0%  

County of Sussex Delaware, RB, NRG Energy, Inc., Indian River Power LLC Project, 6.00%, 10/01/40

    570       601,527  

Delaware Transportation Authority, RB, U.S. 301 Project, 5.00%, 06/01/55

    605       659,480  

State of Delaware EDA, RB, Exempt Facilities, Indian River Power LLC Project, 5.38%, 10/01/45

    2,050       2,125,870  
   

 

 

 
      3,386,877  
District of Columbia — 3.8%  

Metropolitan Washington Airports Authority, Refunding RB, Dulles Toll Road:

   

1st Senior Lien, Series A, 5.00%, 10/01/39

    255       263,976  

1st Senior Lien, Series A, 5.25%, 10/01/44

    1,000       1,038,230  

CAB, 2nd Senior Lien, Series B (AGC), 0.00%, 10/01/34(b)

    10,170       5,232,465  
   

 

 

 
      6,534,671  
Florida — 5.8%  

City of Clearwater Florida Water & Sewer Revenue, RB, Series A, 5.25%, 12/01/19(c)

    1,725       1,815,356  

City of Tampa Florida, RB, Baycare Health System, Series A, 4.00%, 11/15/46

    1,930       1,947,158  

Country of Broward Florida Airport System, ARB, AMT, 5.00%, 10/01/47

    1,600       1,780,176  

County of Broward Florida Water & Sewer Utility, Refunding RB, Series A, 5.25%, 10/01/18(c)

    545       552,913  

County of Collier Florida Health Facilities Authority, Refunding RB, Series A, 5.00%, 05/01/45

    700       766,031  

Mid-Bay Florida Bridge Authority, RB, Springing Lien, Series A, 7.25%, 10/01/21(c)

    1,525       1,770,357  

Village Community Development District No.10, Special Assessment Bonds, 5.13%, 05/01/43

    1,130       1,246,243  
   

 

 

 
      9,878,234  
Georgia — 0.4%  

County of Gainesville Georgia & Hall Hospital Authority, Refunding RB, Northeast Georgia Health System, Inc. Project, Series A, 5.50%, 08/15/54

    270       308,305  

DeKalb Georgia Private Hospital Authority, Refunding RB, Children’s Healthcare, 5.25%, 11/15/39

    420       440,089  
   

 

 

 
      748,394  
Hawaii — 0.4%  

State of Hawaii Harbor System, RB, Series A, 5.25%, 07/01/30

    680       722,826  
   

 

 

 
Idaho — 1.4%  

County of Power Idaho Industrial Development Corp., RB, FMC Corp. Project, AMT, 6.45%, 08/01/32

    2,000       2,008,040  

Idaho Health Facilities Authority, RB, Trinity Health Credit Group, Series A, 5.00%, 12/01/46

    390       436,449  
   

 

 

 
      2,444,489  
Illinois — 15.4%  

Chicago Board of Education, GO, Series H, 5.00%, 12/01/46

    240       235,337  

Chicago Board of Education, GO, Refunding, Dedicated Revenues:

   

Series C, 5.00%, 12/01/34

    240       239,722  

Series D, 5.00%, 12/01/25

    435       459,695  

Chicago Board of Education, GO, Refunding Series F, 5.00%, 12/01/24

    340       358,887  

City of Chicago Illinois, GO, Project, Series A, 5.00%, 01/01/34

    885       895,868  
 

 

 

SCHEDULES OF INVESTMENTS      43  


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniHoldings Fund II, Inc. (MUH)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Illinois (continued)  

City of Chicago Illinois, GO, Refunding, Project, Series A, 5.25%, 01/01/32

  $ 2,290     $ 2,370,264  

City of Chicago Illinois, Special Assessment Bonds, Lake Shore East Project, 6.75%, 12/01/32

    587       590,217  

City of Chicago Illinois O’Hare International Airport, GARB, 3rd Lien:

   

Series A, 5.75%, 01/01/21(c)

    2,100       2,296,350  

Series A, 5.75%, 01/01/39

    400       433,608  

Series C, 6.50%, 01/01/21(c)

    2,935       3,262,106  

City of Chicago Illinois Transit Authority, RB, Sales Tax Receipts, 5.25%, 12/01/40

    530       565,171  

County of Cook Illinois Community College District No. 508, GO, City College of Chicago, 5.50%, 12/01/38

    410       430,639  

Illinois Finance Authority, Refunding RB:

   

Central Dupage Health, Series B, 5.50%, 11/01/19(c)

    800       841,584  

Presence Health Network, Series C, 4.00%, 02/15/41

    745       737,267  

Southern Illinois Healthcare Enterprises, Inc., 4.00%, 03/01/35

    1,290       1,290,890  

Metropolitan Pier & Exposition Authority, Refunding RB, McCormick Place Expansion Project:

   

CAB, Series B (AGM), 0.00%, 06/15/47(b)

    9,555       2,373,749  

Series B (AGM), 5.00%, 06/15/50

    2,230       2,322,723  

Series B-2, 5.00%, 06/15/50

    1,260       1,276,859  

Railsplitter Tobacco Settlement Authority, RB(c):

   

5.50%, 06/01/21

    230       252,988  

6.00%, 06/01/21

    500       557,390  

State of Illinois, GO:

   

5.00%, 02/01/39

    810       813,151  

Series A, 5.00%, 04/01/38

    1,920       1,928,218  

State of Illinois, RB, Build Illinois, Series B, 5.25%, 06/15/19(c)

    315       326,768  

State of Illinois Toll Highway Authority, RB, Series A, 5.00%, 01/01/38

    915       996,975  

University of Illinois, RB, Auxiliary Facilities System, Series A, 5.00%, 04/01/44

    520       557,596  
   

 

 

 
      26,414,022  
Indiana — 4.8%  

City of Valparaiso Indiana, RB, Exempt Facilities, Pratt Paper LLC Project, AMT:

   

6.75%, 01/01/34

    415       484,425  

7.00%, 01/01/44

    1,000       1,173,300  

Indiana Finance Authority, RB, Series A:

   

CWA Authority Project, 1st Lien, 5.25%, 10/01/38

    1,660       1,810,164  

Private Activity Bond, Ohio River Bridges East End Crossing Project, AMT, 5.00%, 07/01/44

    225       239,603  

Private Activity Bond, Ohio River Bridges East End Crossing Project, AMT, 5.00%, 07/01/48

    740       785,880  

Private Activity Bond, Ohio River Bridges East End Crossing Project, AMT, 5.25%, 01/01/51

    210       225,162  

Sisters of St. Francis Health Services, 5.25%, 11/01/19(c)

    420       440,290  

Indiana Finance Authority, Refunding RB, Parkview Health System, Series A:

   

5.75%, 05/01/19(c)

    1,360       1,410,102  

5.75%, 05/01/31

    300       311,478  

Indiana Municipal Power Agency, RB, Series B, 6.00%, 01/01/19(c)

    565       580,419  

Indianapolis Local Public Improvement Bond Bank, RB, Series A, 5.00%, 01/15/40

    640       703,091  
   

 

 

 
      8,163,914  
Iowa — 1.2%  

Iowa Finance Authority, Refunding RB, Iowa Fertilizer Co. Project:

   

Series B, 5.25%, 12/01/50(d)

    240       252,074  
Security   Par
(000)
    Value  
Iowa (continued)  

Midwestern Disaster Area, 5.25%, 12/01/25

  $ 940     $ 1,000,151  

Midwestern Disaster Area, 5.88%, 12/01/26(a)

    210       221,392  

Iowa Student Loan Liquidity Corp., Refunding RB, Student Loan, Senior Series A-1, AMT, 5.15%, 12/01/22

    510       526,060  
   

 

 

 
      1,999,677  
Kansas — 0.7%  

Kansas Development Finance Authority, Refunding RB, Adventist Health System/Sunbelt Obligated Group, Series C:

   

5.75%, 11/15/19(c)

    25       26,368  

5.75%, 11/15/38

    1,080       1,141,798  
   

 

 

 
      1,168,166  
Kentucky — 0.7%  

Kentucky Economic Development Finance Authority, RB, Catholic Health Initiatives, Series A, 5.25%, 01/01/45

    525       557,687  

Kentucky Public Transportation Infrastructure Authority, RB, Downtown Crossing Project, Convertible CAB, 1st Tier, Series C, 0.00%, 07/01/43(e)

    635       586,835  
   

 

 

 
      1,144,522  
Louisiana — 2.7%  

East Baton Rouge Sewerage Commission, RB, Series A, 5.25%, 02/01/19(c)

    420       430,853  

New Orleans Aviation Board, RB, Passenger Facility Charge, Series A, 5.25%, 01/01/41

    310       323,745  

State of Louisiana Gasoline & Fuels Tax Revenue, Refunding RB, First Lien, Series A, 4.00%, 05/01/41

    1,250       1,272,163  

Tobacco Settlement Financing Corp., Refunding RB, Asset-Backed, Series A:

   

5.50%, 05/15/30

    510       543,645  

5.25%, 05/15/31

    435       467,516  

5.25%, 05/15/32

    555       602,791  

5.25%, 05/15/33

    600       646,692  

5.25%, 05/15/35

    255       275,805  
   

 

 

 
      4,563,210  
Maine — 0.1%  

Maine Health & Higher Educational Facilities Authority, RB, Series A:

   

5.00%, 07/01/19(c)

    45       46,587  

5.00%, 07/01/39

    105       108,026  
   

 

 

 
      154,613  
Maryland — 1.5%  

Maryland EDC, RB, Transportation Facilities Project, Series A, 5.75%, 06/01/20(c)

    220       236,586  

Maryland EDC, Refunding RB, CNX Marine Terminals, Inc., 5.75%, 09/01/25

    390       406,875  

Maryland Health & Higher Educational Facilities Authority, RB:

   

Trinity Health Credit Group, Series 2017, 5.00%, 12/01/46

    20       22,515  

University of Maryland Medical System Issue, 4.00%, 07/01/48

    755       745,834  

Maryland Health & Higher Educational Facilities Authority, Refunding RB, Charlestown Community Project, 6.25%, 01/01/21(c)

    1,095       1,208,497  
   

 

 

 
      2,620,307  
Massachusetts — 2.4%  

Massachusetts Development Finance Agency, Refunding RB:

   

Boston University, Series P, 5.45%, 05/15/59

    845       990,813  

Covanta Energy Project, Series C, AMT, 5.25%, 11/01/42(a)

    1,155       1,155,693  

Massachusetts Health & Educational Facilities Authority, Refunding RB, Partners Healthcare System, Series J1, 5.00%, 07/01/19(c)

    360       372,693  
 

 

 

44    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniHoldings Fund II, Inc. (MUH)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Massachusetts (continued)  

Massachusetts HFA, Refunding RB, Series F, AMT, 5.70%, 06/01/40

  $ 815     $ 823,688  

Massachusetts Housing Finance Agency, RB, M/F Housing, Series D, 3.95%, 12/01/52

    845       808,116  
   

 

 

 
      4,151,003  
Michigan — 3.0%  

City of Detroit Michigan Sewage Disposal System, Refunding RB, Senior Lien, Series A, 5.25%, 07/01/39

    2,235       2,389,684  

Kalamazoo Hospital Finance Authority, Refunding RB, Bronson Methodist Hospital:

   

5.50%, 05/15/20(c)

    380       405,775  

5.50%, 05/15/36

    310       326,638  

Michigan Finance Authority, Refunding RB, Detroit Water & Sewage Department Project, Senior Lien, Series C-1, 5.00%, 07/01/44

    455       492,019  

Michigan State Hospital Finance Authority, Refunding RB, Henry Ford Health System, 5.75%, 11/15/19(c)

    1,520       1,606,747  
   

 

 

 
      5,220,863  
Minnesota — 0.9%  

City of Minneapolis Minnesota, Refunding RB, Fairview Health Services, Series A, 6.75%, 11/15/18(c)

    1,540       1,580,733  
   

 

 

 
Missouri — 0.2%  

Bi-State Development Agency of the Missouri-Illinois Metropolitan District, Refunding RB, Combined Lien, Series A, 5.00%, 10/01/44

    125       137,268  

State of Missouri Health & Educational Facilities Authority, Refunding RB, St. Louis College of Pharmacy Project, 5.50%, 05/01/43

    130       139,422  
   

 

 

 
      276,690  
New Hampshire — 1.4%  

New Hampshire Health & Education Facilities Authority, Refunding RB, Dartmouth-Hitchcock, 6.00%, 08/01/19(c)

    1,530       1,606,316  

New Hampshire Housing Finance Authority, RB, Cimarron, Whittier Falls & Marshall (FHA), 4.00%, 07/01/52

    800       797,008  
   

 

 

 
      2,403,324  
New Jersey — 7.0%  

Casino Reinvestment Development Authority, Refunding RB:

   

5.25%, 11/01/39

    530       561,551  

5.25%, 11/01/44

    790       837,202  

County of Essex New Jersey Improvement Authority, RB, AMT, 5.25%, 07/01/45(a)

    560       565,197  

New Jersey EDA, RB, Continental Airlines, Inc. Project, AMT:

   

5.13%, 09/15/23

    1,040       1,122,649  

5.25%, 09/15/29

    990       1,074,110  

New Jersey EDA, Refunding, Special Assessment Bonds, Kapkowski Road Landfill Project, 5.75%, 04/01/31

    1,125       1,245,814  

New Jersey State Turnpike Authority, RB, Series E, 5.00%, 01/01/45

    1,355       1,485,785  

New Jersey Transportation Trust Fund Authority, RB:

   

Transportation Program, Series AA, 5.00%, 06/15/44

    225       234,491  

Transportation Program, Series AA, 5.00%, 06/15/44

    420       437,669  

Transportation System, Series A, 5.50%, 06/15/41

    1,025       1,069,311  

Transportation System, Series B, 5.25%, 06/15/36

    1,235       1,284,202  

South Jersey Port Corp., ARB, Marine Terminal, Series B, AMT, 5.00%, 01/01/42

    195       208,395  

Tobacco Settlement Financing Corp., Refunding RB:

   

Series A, 5.00%, 06/01/46

    770       831,346  

Series A, 5.25%, 06/01/46

    200       222,126  

Sub-Series B, 5.00%, 06/01/46

    775       813,145  
   

 

 

 
      11,992,993  
Security   Par
(000)
    Value  
New York — 7.3%  

City of New York New York Transitional Finance Authority Future Tax Secured, RB, Fiscal 2012, Sub-Series E-1, 5.00%, 02/01/42

  $ 740     $ 799,141  

Counties of New York Tobacco Trust IV, Refunding RB, Settlement Pass-Through Turbo, Series A, 6.25%, 06/01/41(a)

    1,000       1,041,400  

County of Dutchess New York Industrial Development Agency, Refunding RB, Bard College Civic Facility, Series A-1, 5.00%, 08/01/46

    1,355       1,282,426  

County of Westchester New York Healthcare Corp., RB, Senior Lien, Series A, 5.00%, 11/01/44

    262       277,892  

Erie Tobacco Asset Securitization Corp., Refunding RB, Asset-Backed, Series A, 5.00%, 06/01/45

    1,020       997,744  

Long Island Power Authority, Refunding RB, Electric System, Series A, 5.75%, 04/01/19(c)

    1,050       1,087,117  

Metropolitan Transportation Authority, RB, Series B, 5.25%, 11/15/38

    1,255       1,415,740  

Metropolitan Transportation Authority, Refunding RB, Dedicated Tax Fund, Series B, 5.00%, 11/15/19(c)

    1,270       1,331,290  

New York Liberty Development Corp., Refunding RB:

   

2nd Priority, Bank of America Tower at One Bryant Park Project, Class 3, 6.38%, 07/15/49

    615       650,541  

3 World Trade Center Project, Class 1, 5.00%, 11/15/44(a)

    1,495       1,570,557  

3 World Trade Center Project, Class 2, 5.15%, 11/15/34(a)

    175       190,409  

3 World Trade Center Project, Class 2, 5.38%, 11/15/40(a)

    440       479,239  

Port Authority of New York & New Jersey, ARB, Special Project, JFK International Air Terminal LLC Project, Series 8:

   

6.00%, 12/01/36

    650       711,796  

6.00%, 12/01/42

    630       688,892  
   

 

 

 
      12,524,184  
North Carolina — 0.2%  

North Carolina Medical Care Commission, Refunding RB, 1st Mortgage, Retirement Facilities Whitestone Project, Series A, 7.75%, 03/01/21(c)

    305       350,558  
   

 

 

 
Ohio — 1.6%  

Buckeye Tobacco Settlement Financing Authority, RB, Asset-Backed, Senior Turbo Term, Series A-2, 5.88%, 06/01/47

    1,855       1,854,981  

County of Franklin Ohio, RB, Health Care Facilities Improvement, OPRS Communities Obligation Group, Series A, 6.13%, 07/01/40

    350       381,469  

State of Ohio, RB, Portsmouth Bypass Project, AMT, 5.00%, 06/30/53

    420       457,636  
   

 

 

 
      2,694,086  
Oklahoma — 0.9%  

Oklahoma Development Finance Authority, RB, OU Medicine Project, Series B, 5.50%, 08/15/57

    625       693,363  

Oklahoma Turnpike Authority, RB, 2nd Series C, 4.00%, 01/01/42

    885       905,151  
   

 

 

 
      1,598,514  
Pennsylvania — 5.7%  

City of Philadelphia Pennsylvania Hospitals & Higher Education Facilities Authority, RB, Temple University Health System, Series A, 5.63%, 07/01/42

    335       362,075  

Commonwealth Financing Authority, RB, Tobacco Master Settlement Payment:

   

5.00%, 06/01/33

    110       123,019  

5.00%, 06/01/34

    195       216,682  

5.00%, 06/01/35

    365       404,613  

County of Berks IDA, Refunding RB, Tower Health Project, 4.00%, 11/01/39

    1,835       1,835,000  
 

 

 

SCHEDULES OF INVESTMENTS      45  


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniHoldings Fund II, Inc. (MUH)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Pennsylvania (continued)  

County of Montgomery Higher Education & Health Authority, Refunding RB, Thomas Jefferson University, Series A, 4.00%, 09/01/49

  $ 320     $ 314,925  

Pennsylvania Economic Development Financing Authority, RB:

   

American Water Co. Project, 6.20%, 04/01/39

    1,830       1,896,173  

AMT, 5.00%, 06/30/42

    440       470,989  

Pennsylvania Economic Development Financing Authority, Refunding RB:

   

National Gypsum Co., AMT, 5.50%, 11/01/44

    800       840,960  

Series A, 4.00%, 11/15/42

    130       131,232  

Series A, 4.00%, 11/15/47

    2,000       2,004,700  

Pennsylvania Turnpike Commission, RB, Series A, 5.00%, 12/01/44

    585       636,521  

State Public School Building Authority, Refunding RB, The School District of Philadelphia Project, Series A, 5.00%, 06/01/34

    550       608,102  
   

 

 

 
      9,844,991  
Puerto Rico — 1.1%  

Children’s Trust Fund, Refunding RB, Tobacco Settlement Asset-Backed Bonds:

   

5.50%, 05/15/39

    975       951,249  

5.63%, 05/15/43

    925       884,587  
   

 

 

 
      1,835,836  
Rhode Island — 2.2%  

Tobacco Settlement Financing Corp., Refunding RB:

   

Series A, 5.00%, 06/01/35

    420       451,559  

Series B, 4.50%, 06/01/45

    1,375       1,389,080  

Series B, 5.00%, 06/01/50

    1,895       1,941,446  
   

 

 

 
      3,782,085  
South Carolina — 3.8%  

State of South Carolina Ports Authority, ARB:

   

5.25%, 07/01/40

    1,650       1,748,521  

AMT, 5.25%, 07/01/55

    670       740,122  

State of South Carolina Public Service Authority, RB, Santee Cooper, Series A, 5.50%, 12/01/54

    2,040       2,226,640  

State of South Carolina Public Service Authority, Refunding RB, Series E, 5.25%, 12/01/55

    1,635       1,778,602  
   

 

 

 
      6,493,885  
Tennessee — 0.7%  

City of Chattanooga Health Educational & Housing Facility Board, RB, Catholic Health Initiatives, Series A, 5.25%, 01/01/45

    720       764,827  

County of Nashville & Davidson Metropolitan Government Health & Educational Facilities Board, RB, Vanderbilt University Medical Center, Series A, 5.00%, 07/01/40

    360       395,626  
   

 

 

 
      1,160,453  
Texas — 6.9%  

Central Texas Regional Mobility Authority, Refunding RB:

   

Senior Lien, 6.25%, 01/01/21(c)

    1,070       1,180,905  

Sub-Lien, 5.00%, 01/01/33

    180       194,170  

City of Austin Texas Airport System, ARB, AMT, 5.00%, 11/15/39

    320       347,434  

City of Houston Texas Airport System, Refunding ARB, Senior Lien, Series A, 5.50%, 07/01/39

    535       538,124  

County of Harris Texas Cultural Education Facilities Finance Corp., RB, 1st Mortgage, Brazos Presbyterian Homes, Inc. Project, Series B, 7.00%, 01/01/23(c)

    240       288,310  

County of Harris Texas Health Facilities Development Corp., Refunding RB, Memorial Hermann Healthcare System, Series B, 7.25%, 12/01/18(c)

    1,380       1,423,290  
Security   Par
(000)
    Value  
Texas (continued)  

County of Midland Texas Fresh Water Supply District No. 1, RB, CAB, City of Midland Project, Series A(b):

   

0.00%, 09/15/40

  $ 2,525     $ 945,486  

0.00%, 09/15/41

    1,395       495,853  

La Vernia Higher Education Finance Corp., RB, Kipp, Inc., Series A, 6.38%, 08/15/19(c)

    320       337,760  

New Hope Cultural Education Facilities Corp., RB, Collegiate Housing Tarleton State University Project, 5.00%, 04/01/35

    145       155,633  

North Texas Tollway Authority, RB, CAB, Special Project System, Series B, 0.00%, 09/01/31(b)(c)

    1,015       430,076  

San Antonio Water System, Refunding RB, Junior Lien, Series A, 5.00%, 05/15/48(f)

    670       761,723  

Texas Private Activity Bond Surface Transportation Corp., RB, Senior Lien:

   

LBJ Infrastructure Group LLC, 7.00%, 06/30/40

    1,165       1,278,448  

NTE Mobility Partners LLC, North Tarrant Express Managed Lanes Project, 6.88%, 12/31/39

    1,300       1,397,604  

University of Texas System, Refunding RB, Permanent University Fund, Series B, 4.00%, 07/01/41(g)

    1,975       2,041,676  
   

 

 

 
      11,816,492  
Virginia — 1.9%  

Hampton Roads Transportation Accountability Commission, RB, Transportation Fund, Senior Lien, Series A, 5.50%, 07/01/57

    1,090       1,288,969  

Virginia Small Business Financing Authority, RB, Senior Lien, Elizabeth River Crossings OpCo LLC Project, AMT:

   

5.25%, 01/01/32

    400       434,640  

6.00%, 01/01/37

    1,345       1,496,756  
   

 

 

 
      3,220,365  
Washington — 1.0%  

Port of Seattle Washington, RB, Intermediate Lien, Series C, AMT, 5.00%, 04/01/40

    390       420,549  

Washington Health Care Facilities Authority, RB, Catholic Health Initiatives, Series A, 5.75%, 01/01/45

    1,195       1,302,729  
   

 

 

 
      1,723,278  
Wisconsin — 3.4%  

State of Wisconsin, Refunding RB, Series A, 6.00%, 05/01/19(c)

    3,620       3,769,579  

State of Wisconsin Health & Educational Facilities Authority, RB, Ascension Health Senior Credit Group, Series E, 5.00%, 11/15/33

    1,235       1,288,080  

Wisconsin Health & Educational Facilities Authority, RB, Aspirus, Inc. Obligated Group, 5.00%, 08/15/52

    780       855,816  
   

 

 

 
      5,913,475  
   

 

 

 

Total Municipal Bonds — 111.0%
(Cost — $178,007,589)

 

    190,200,955  
   

 

 

 

Municipal Bonds Transferred to Tender Option Bond Trusts(g)

 

California — 9.0%  

Bay Area Toll Authority, Refunding RB, San Francisco Bay Area:

   

Toll Bridge, 4.00%, 04/01/42(h)

    1,638       1,695,303  

Series F-1, 5.63%, 04/01/19(c)

    1,640       1,698,413  

California Educational Facilities Authority, RB, University of Southern California, Series B, 5.25%, 10/01/18(c)(h)

    1,335       1,353,831  

City & County of San Francisco California Public Utilities Commission, RB, Water Revenue, Series B, 5.00%, 11/01/19(c)

    4,770       4,994,826  

City of Los Angeles California Department of Airports, Refunding ARB, Los Angeles International Airport, Senior Series A, 5.00%, 05/15/40

    2,967       3,146,298  
 

 

 

46    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniHoldings Fund II, Inc. (MUH)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
California (continued)  

Sacramento Area Flood Control Agency, Refunding, Consolidated Capital Assessment District No. 2 Bonds, 5.00%, 10/01/47

  $ 1,635     $ 1,855,363  

San Diego California Community College District, GO, Election of 2002, 5.25%, 08/01/19(c)

    553       576,906  
   

 

 

 
      15,320,940  
Colorado — 2.5%  

Colorado Health Facilities Authority, RB, Catholic Health, Series C-7 (AGM), 5.00%, 09/01/36(c)

    1,200       1,200,000  

Colorado Health Facilities Authority, Refunding RB, Catholic Health Initiatives, Series A, 5.50%, 07/01/34(h)

    1,080       1,113,901  

County of Adams Colorado, COP, Refunding, 4.00%, 12/01/45

    1,950       1,991,993  
   

 

 

 
      4,305,894  
Florida — 2.6%  

County of Miami-Dade Florida, RB, Water & Sewer System, 5.00%, 10/01/20(c)

    2,840       3,037,417  

South Miami Health Facilities Authority, Refunding RB, Baptist Health South Florida, 5.00%, 08/15/47

    1,290       1,433,568  
   

 

 

 
      4,470,985  
Georgia — 1.0%  

Private Colleges & Universities Authority, Refunding RB, Emory University, Series C, 5.00%, 09/01/18(c)

    1,649       1,667,021  
   

 

 

 
Maryland — 2.1%  

City of Baltimore Maryland Water Utility Fund, RB, Wastewater Project, Series A, 5.00%, 07/01/46

    1,515       1,695,691  

State of Maryland Stadium Authority Revenue, RB, Construction and Revitalization Program, 5.00%, 05/01/42

    1,740       1,972,708  
   

 

 

 
      3,668,399  
Massachusetts — 3.3%  

Commonwealth of Massachusetts, GO, Series A, 5.00%, 01/01/46

    1,982       2,256,998  

Massachusetts School Building Authority, RB, Senior, Series B, 5.00%, 10/15/41

    3,211       3,456,532  
   

 

 

 
      5,713,530  
Nevada — 1.5%  

Clark County Nevada, 5.00%, 05/01/48

    2,260       2,566,637  
   

 

 

 
New Hampshire — 0.6%  

New Hampshire Health & Education Facilities Authority, RB, Dartmouth College, 5.25%, 06/01/19(c)(h)

    1,020       1,056,358  
   

 

 

 
New York — 10.9%  

City of New York New York Municipal Water Finance Authority, Refunding RB, Water & Sewer System, 2nd General Resolution, Series FF-2, 5.50%, 06/15/40

    810       842,495  

City of New York New York Transitional Finance Authority, BARB, Fiscal 2009, Series S-3, 5.25%, 01/15/39

    3,299       3,373,672  

Hudson Yards Infrastructure Corp., RB, Fiscal 2012, Series A, 5.75%, 02/15/47(h)

    810       884,076  

Metropolitan Transportation Authority, Refunding RB, Series C-1, 5.25%, 11/15/56

    2,340       2,636,028  

New York Liberty Development Corp., ARB, 1 World Trade Center Port Authority Consolidated Bonds, 5.25%, 12/15/43

    5,400       5,883,041  

New York Liberty Development Corp., Refunding RB, 4 World Trade Center Project, 5.75%, 11/15/51(h)

    3,250       3,596,302  

Port Authority of New York & New Jersey, Refunding ARB, 194th Series, 5.25%, 10/15/55

    1,350       1,510,924  
   

 

 

 
      18,726,538  
Security   Par
(000)
    Value  
North Carolina — 1.3%  

North Carolina Capital Facilities Finance Agency, Refunding RB:

   

Duke University Project, Series B, 5.00%, 10/01/55

  $ 1,320     $ 1,470,718  

Wake Forest University, 5.00%, 01/01/19(c)

    800       816,644  
   

 

 

 
      2,287,362  
Ohio — 4.2%  

State of Ohio, Refunding RB, Cleveland Clinic Health System Obligated Group, Series A, 5.50%, 01/01/19(c)

    6,974       7,140,047  
   

 

 

 
Pennsylvania — 0.8%  

Pennsylvania Turnpike Commission, RB, Sub-Series A, 5.50%, 12/01/42

    1,229       1,399,856  
   

 

 

 
Texas — 8.0%  

City of Houston Texas Community College, GOL, 4.00%, 02/15/43

    1,395       1,416,204  

City of San Antonio Texas Electric and Gas Systems, RB, Junior Lien, 5.00%, 02/01/43

    1,260       1,359,524  

County of Harris Texas, RB, Toll Road, Senior Lien, Series A(h):

   

5.00%, 08/15/19(c)

    1,905       1,971,659  

5.00%, 08/15/38

    1,457       1,508,148  

County of Harris Texas Metropolitan Transit Authority, Refunding RB, Series A, 5.00%, 11/01/41

    1,710       1,845,774  

County of Harris Texas Toll Road Authority, Refunding RB, Senior Lien, Series A, 5.00%, 08/15/43

    1,858       2,118,518  

San Antonio Public Facilities Corp., Refunding RB, Convention Center Refinancing And Expansion Project, 4.00%, 09/15/42

    1,499       1,511,617  

University of Texas, Refunding RB, Financing System, Series B, 5.00%, 08/15/43

    1,801       1,978,157  
   

 

 

 
      13,709,601  
Utah — 0.9%  

City of Riverton Utah, RB, IHC Health Services, Inc., 5.00%, 08/15/41

    1,395       1,446,362  
   

 

 

 
Virginia — 2.6%  

University of Virginia, Refunding RB, General, 5.00%, 06/01/18(c)

    2,729       2,736,519  

Virginia Small Business Financing Authority, Refunding RB, Sentara Healthcare, 5.00%, 11/01/40

    1,553       1,633,452  
   

 

 

 
      4,369,971  
Wisconsin — 1.7%  

Wisconsin Health & Educational Facilities Authority, Refunding RB, Froedtert & Community Health, Inc., Obligated Group, Series C, 5.25%, 04/01/19(c)(h)

    2,859       2,947,253  
   

 

 

 

Total Municipal Bonds Transferred to Tender Option Bond Trusts — 53.0%
(Cost — $88,472,403)

 

    90,796,754  
   

 

 

 

Total Long-Term Investments — 164.0%
(Cost — $266,479,992)

 

    280,997,709  
   

 

 

 
 

 

 

SCHEDULES OF INVESTMENTS      47  


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniHoldings Fund II, Inc. (MUH)

(Percentages shown are based on Net Assets)

 

         
Shares
    Value  

Short-Term Securities — 0.6%

 

BlackRock Liquidity Funds, MuniCash, Institutional Class, 1.48%(i)(j)

    978,065     $ 978,065  
   

 

 

 

Total Short-Term Securities — 0.6%
(Cost — $978,065)

 

    978,065  
   

 

 

 

Total Investments — 164.6%
(Cost — $267,458,057)

 

    281,975,774  

Liabilities in Excess of Other Assets — (0.8)%

 

    (1,341,322

Liability for TOB Trust Certificates, Including Interest Expense and Fees Payable — (31.7)%

 

    (54,288,738

VMTP Shares at Liquidation Value — (32.1)%

 

    (55,000,000
   

 

 

 

Net Assets Applicable to Common Shares — 100.0%

 

  $ 171,345,714  
   

 

 

 

 

(a)  Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors.

 

(b)  Zero-coupon bond.
(c)  U.S. Government securities, held in escrow, are used to pay interest on this security, as well as to retire the bond in full at the date indicated, typically at a premium to par.
(d)  Variable or floating rate security, which interest rate adjusts periodically based on changes in current interest rates and prepayments on the underlying pool of assets. Rate shown is the rate in effect as of period end.
(e)  Step-up bond that pays an initial coupon rate for the first period and then a higher coupon rate for the following periods. Rate as of period end.
(f)  When-issued security.
(g)  Represent bonds transferred to a TOB Trust in exchange of cash and residual certificates received by the Fund. These bonds serve as collateral in a secured borrowing. See Note 4 of the Notes to Financial Statements for details.
(h)  All or a portion of security is subject to a recourse agreement. The aggregate maximum potential amount the Fund could ultimately be required to pay under the agreements, which expire between May 7, 2018 to February 15, 2031, is $9,716,216. See Note 4 of the Notes to Financial Statements for details.
(i)  Annualized 7-day yield as of period end.
 
(j)  During the year ended April 30, 2018, investments in issuers considered to be an affiliate of the Fund for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliated    Shares
Held at
04/30/17
     Net
Activity
     Shares
Held at

04/30/18
     Value at
04/30/18
     Income      Net
Realized
Gain (Loss)
 (a)
     Change in
Unrealized
Appreciation
(Depreciation)
 

BlackRock Liquidity Funds, MuniCash, Institutional Class

     712,360        265,705        978,065      $ 978,065      $ 19,198      $ 474      $ (71
           

 

 

    

 

 

    

 

 

    

 

 

 

 

  (a)  Includes net capital gain distributions, if applicable.  

Derivative Financial Instruments Outstanding as of Period End

Futures Contracts

 

Description    Number of
Contracts
       Expiration
Date
       Notional
Amount
 (000)
       Value/
Unrealized
Appreciation
(Depreciation)
 

Short Contracts:

                 

10-Year U.S. Treasury Note

     13          06/20/18        $ 1,555        $ 6,547  

Long U.S. Treasury Bond

     40          06/20/18          5,754          (1,718

5-Year U.S. Treasury Note

     8          06/29/18          908          2,123  
                 

 

 

 
                  $ 6,952  
                 

 

 

 

Derivative Financial Instruments Categorized by Risk Exposure

As of year end, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:

 

      Commodity
Contracts
     Credit
Contracts
     Equity
Contracts
     Foreign
Currency
Exchange
Contracts
     Interest
Rate
Contracts
     Other
Contracts
     Total  

Assets — Derivative Financial Instruments

                    

Futures contracts

                    

Net unrealized appreciation(a)

   $      $      $      $      $ 8,670      $      $ 8,670  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
Liabilities — Derivative Financial Instruments                                                 

Futures contracts

                    

Net unrealized depreciation(a)

   $      $      $      $      $ 1,718      $      $ 1,718  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

  (a)  Includes cumulative appreciation (depreciation) on futures contracts, if any, as reported in the Schedule of Investments. Only current day’s variation margin is reported within the Statements of Assets and Liabilities.  

 

 

48    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniHoldings Fund II, Inc. (MUH)

 

For the year ended April 30, 2018, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

      Commodity
Contracts
     Credit
Contracts
     Equity
Contracts
     Foreign
Currency
Exchange
Contracts
     Interest
Rate
Contracts
     Other
Contracts
     Total  

Net Realized Gain (Loss) from:

                    

Futures contracts

   $      $      $      $      $ 481,810      $      $ 481,810  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
Net Change in Unrealized Appreciation (Depreciation) on:                                                 

Futures contracts

   $      $      $      $      $ 133,767      $      $ 133,767  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

Futures contracts:

        

Average notional value of contracts — short

   $ 11,204,588  

For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.

Fair Value Hierarchy as of Period End

Various inputs are used in determining the fair value of investments and derivative financial instruments. For information about the Fund’s policy regarding valuation of investments and derivative financial instruments, refer to the Notes to Financial Statements.

The following tables summarize the Fund’s investments and derivative financial instruments categorized in the disclosure hierarchy:

 

      Level 1        Level 2        Level 3        Total  

Assets:

                 

Investments:

                 

Long-Term Investments(a)

   $        $ 280,997,709        $             —        $ 280,997,709  

Short-Term Securities

     978,065                            978,065  
  

 

 

      

 

 

      

 

 

      

 

 

 
   $ 978,065        $ 280,997,709        $        $ 281,975,774  
  

 

 

      

 

 

      

 

 

      

 

 

 

Derivative Financial Instruments(b)

                 

Assets:

                 

Interest rate contracts

   $ 8,670        $        $        $ 8,670  

Liabilities:

                 

Interest rate contracts

     (1,718                          (1,718
  

 

 

      

 

 

      

 

 

      

 

 

 
   $ 6,952        $        $        $ 6,952  
  

 

 

      

 

 

      

 

 

      

 

 

 

 

  (a)  See above Schedule of Investments for values in each state or political subdivision.  
  (b)  Derivative financial instruments are futures contracts which are valued at the unrealized appreciation (depreciation) on the instrument.  

The Fund may hold assets and/or liabilities in which the fair value approximates the carrying amount for financial statement purposes. As of year end, such assets and/or liabilities are categorized within the disclosure hierarchy as follows:

 

      Level 1        Level 2        Level 3        Total  

Liabilities:

 

TOB Trust Certificates

   $             —        $ (54,099,850      $             —        $ (54,099,850

VMTP Shares at Liquidation Value

              (55,000,000                 (55,000,000
  

 

 

      

 

 

      

 

 

      

 

 

 
   $        $ (109,099,850      $        $ (109,099,850
  

 

 

      

 

 

      

 

 

      

 

 

 

During the year ended April 30, 2018, there were no transfers between levels.

See notes to financial statements.

 

 

SCHEDULES OF INVESTMENTS      49  


Schedule of Investments  

April 30, 2018

  

BlackRock MuniHoldings Quality Fund, Inc. (MUS)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  

Municipal Bonds — 135.3%

 

Alabama — 1.7%  

City of Birmingham Alabama Special Care Facilities Financing Authority, RB, Children’s Hospital (AGC), 6.00%, 06/01/19(a)

  $ 2,330     $ 2,432,683  

City of Selma Alabama IDB, RB, Gulf Opportunity Zone, International Paper Co. Project, Series A, 5.38%, 12/01/35

    565       624,579  
   

 

 

 
      3,057,262  
California — 23.9%  

California Educational Facilities Authority, RB, University of Southern California, Series A, 5.25%, 10/01/18(a)

    2,895       2,937,759  

California Health Facilities Financing Authority, RB, Sutter Health:

   

Series A, 4.00%, 11/15/42

    125       126,883  

Series B, 6.00%, 08/15/20(a)

    1,730       1,889,108  

Central Unified School District, GO, Election of 2008, Series A (AGC), 5.63%, 08/01/19(a)

    1,325       1,387,858  

City & County of San Francisco California Airports Commission, Refunding ARB, AMT, Series A:

   

2nd, 5.50%, 05/01/28

    1,085       1,225,594  

2nd, 5.25%, 05/01/33

    850       941,885  

5.00%, 05/01/44

    1,090       1,188,841  

City of Los Angeles California Department of Water & Power, RB, Power System, Sub-Series A-1, 5.25%, 07/01/38

    1,575       1,584,135  

City of San Jose California, Refunding ARB, Norman Y Mineta San Jose International Airport SJC, Series A-1, AMT:

   

5.50%, 03/01/30

    2,400       2,592,744  

5.75%, 03/01/34

    2,180       2,369,878  

City of Sunnyvale California, Refunding RB, 5.25%, 04/01/20(a)

    1,605       1,708,378  

County of Riverside Public Financing Authority, RB, Capital Facilities Project, 5.25%, 11/01/40

    2,500       2,860,725  

County of Sacramento California, ARB, Senior Series A (AGC), 5.50%, 07/01/18(a)

    2,100       2,113,041  

County of Ventura California Community College District, GO, Election of 2002, Series C, 5.50%, 08/01/18(a)

    1,850       1,867,520  

Kern Community College District, GO, Safety, Repair & Improvement, Series C, 5.50%, 11/01/33

    1,420       1,649,415  

Los Angeles Community College District California, GO, Election of 2008, Series C, 5.25%, 08/01/20(a)

    1,000       1,075,160  

Oceanside Unified School District, GO, Series A (AGC), 5.25%, 08/01/33

    1,825       1,840,075  

Redondo Beach Unified School District, GO, Election of 2008, Series E, 5.50%, 08/01/21(a)

    1,335       1,485,161  

Regents of the University of California Medical Center Pooled Revenue, Refunding RB, Series J:

   

5.25%, 05/15/23(a)

    3,170       3,641,537  

5.25%, 05/15/38

    900       1,015,974  

State of California Public Works Board, LRB, Various Capital Projects, Series I:

   

5.50%, 11/01/30

    1,500       1,726,470  

5.50%, 11/01/31

    2,465       2,833,074  

State of California Public Works Board, RB, Department of Corrections & Rehabilitation, Series F, 5.25%, 09/01/33

    725       817,720  

Township of Washington California Health Care District, GO, Election of 2004, Series B, 5.50%, 08/01/40

    540       622,339  
   

 

 

 
      41,501,274  
Colorado — 2.3%  

City & County of Denver Colorado Airport System, ARB, Series A, AMT:

   

5.50%, 11/15/28

    1,000       1,126,090  

5.50%, 11/15/30

    340       380,664  

5.50%, 11/15/31

    405       452,344  
Security   Par
(000)
    Value  
Colorado (continued)  

Colorado Health Facilities Authority, RB, Hospital, NCMC, Inc. Project, Series B (AGM), 6.00%, 05/15/19(a)

  $ 1,900     $ 1,978,527  
   

 

 

 
      3,937,625  
Connecticut — 1.0%  

State of Connecticut, GO, Series A, 5.00%, 04/15/38

    985       1,077,905  

State of Connecticut Health & Educational Facility Authority, Refunding RB, Sacred Heart University Issue, Series I-1, 5.00%, 07/01/42

    590       651,053  
   

 

 

 
      1,728,958  
District of Columbia — 1.2%  

District of Columbia Water & Sewer Authority, Refunding RB, Series A, 5.50%, 10/01/18(a)

    2,000       2,031,080  
   

 

 

 
Florida — 16.2%  

City of Jacksonville Florida, Refunding RB, Series A, 5.25%, 10/01/33

    400       449,332  

County of Broward Florida Airport System Revenue, ARB, Series A, AMT, 5.00%, 10/01/45

    2,845       3,113,682  

County of Hillsborough Florida Aviation Authority, Refunding ARB, Tampa International Airport, Series A, AMT, 5.50%, 10/01/29

    1,735       1,943,772  

County of Lee Florida, Refunding ARB, Series A, AMT, 5.38%, 10/01/32

    1,500       1,619,895  

County of Lee Florida HFA, RB, S/F Housing, Multi-County Program, Series A-2, AMT (Ginnie Mae, Fannie Mae & Freddie Mac), 6.00%, 09/01/40

    110       111,075  

County of Miami-Dade Florida, RB, Seaport Department:

   

Series A, 5.38%, 10/01/33

    1,015       1,127,107  

Series A, 6.00%, 10/01/38

    1,000       1,144,560  

Series B, AMT, 6.25%, 10/01/38

    460       532,188  

Series B, AMT, 6.00%, 10/01/42

    615       703,240  

County of Miami-Dade Florida Aviation, Refunding ARB, Series A, AMT, 5.00%, 10/01/31

    2,900       3,144,267  

County of Miami-Dade Florida Educational Facilities Authority, RB, University of Miami, Series A, 5.00%, 04/01/40

    3,465       3,803,946  

County of Orange Florida School Board, COP, Series A (AGC), 5.50%, 08/01/19(a)

    4,645       4,854,118  

Reedy Creek Florida Improvement District, GO, Series A, 5.25%, 06/01/32

    1,040       1,174,046  

Tohopekaliga Water Authority, Refunding RB, Series A, 5.25%, 10/01/21(a)

    3,995       4,404,647  
   

 

 

 
      28,125,875  
Hawaii — 1.5%  

State of Hawaii, Department of Transportation, COP, AMT:

   

5.25%, 08/01/25

    425       472,396  

5.25%, 08/01/26

    460       508,705  

State of Hawaii, Department of Transportation, RB, Series A, AMT, 5.00%, 07/01/45

    1,500       1,652,400  
   

 

 

 
      2,633,501  
Illinois — 15.0%  

City of Chicago Illinois Midway International Airport, Refunding GARB, 2nd Lien, Series A, AMT, 5.00%, 01/01/41

    1,000       1,075,350  

City of Chicago Illinois O’Hare International Airport, GARB:

   

3rd Lien, Series A, 5.75%, 01/01/21(a)

    960       1,049,760  

3rd Lien, Series A, 5.75%, 01/01/39

    185       200,544  

3rd Lien, Series C, 6.50%, 01/01/21(a)

    5,225       5,807,326  

Senior Lien, Series D, AMT, 5.00%, 01/01/42

    430       467,767  

City of Chicago Illinois Transit Authority, RB:

   

Federal Transit Administration, Section 5309, Series A (AGC), 6.00%, 12/01/18(a)

    2,000       2,048,960  

Sales Tax Receipts, 5.25%, 12/01/36

    1,000       1,070,200  

Sales Tax Receipts, 5.25%, 12/01/40

    1,790       1,908,784  
 

 

 

50    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniHoldings Quality Fund, Inc. (MUS)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Illinois (continued)  

City of Chicago Illinois Wastewater Transmission, RB, 2nd Lien, 5.00%, 01/01/42

  $ 2,050     $ 2,146,165  

County of Cook Illinois Community College District No. 508, GO, City College of Chicago:

   

5.50%, 12/01/38

    1,250       1,312,925  

5.25%, 12/01/43

    1,505       1,559,345  

Illinois Finance Authority, Refunding RB, Presence Health Network, Series C, 5.00%, 02/15/41

    555       608,236  

Railsplitter Tobacco Settlement Authority, RB(a):

   

5.50%, 06/01/21

    1,405       1,545,430  

6.00%, 06/01/21

    400       445,912  

State of Illinois, GO:

   

5.25%, 02/01/31

    875       898,922  

5.25%, 02/01/32

    1,355       1,389,309  

5.50%, 07/01/33

    2,000       2,068,760  

5.50%, 07/01/38

    425       437,457  
   

 

 

 
      26,041,152  
Indiana — 3.9%  

Indianapolis Local Public Improvement Bond Bank, RB, Series F, 5.25%, 02/01/36

    3,055       3,269,858  

Indianapolis Local Public Improvement Bond Bank, Refunding RB, Waterworks Project, Series A (AGC):

   

5.50%, 01/01/19(a)

    545       558,456  

5.50%, 01/01/38

    2,235       2,285,221  

State of Indiana Finance Authority, RB, Private Activity Bond, Ohio River Bridges, Series A, AMT, 5.00%, 07/01/40

    565       603,041  
   

 

 

 
      6,716,576  
Louisiana — 4.0%  

City of New Orleans Aviation Board, ARB, General Airport North Terminal Project, Series B, AMT, 5.00%, 01/01/48

    3,740       4,082,920  

Lake Charles Louisiana Harbor & Terminal District, RB, Series B, AMT (AGM), 5.50%, 01/01/29

    1,500       1,674,060  

Tobacco Settlement Financing Corp., Refunding RB, Asset-Backed, Series A, 5.50%, 05/15/29

    1,215       1,259,275  
   

 

 

 
      7,016,255  
Maryland — 2.7%  

County of Howard Maryland Housing Commission, RB, M/F Housing, Woodfield Oxford Square Apartments, 5.00%, 12/01/42

    1,430       1,583,639  

Maryland Stadium Authority, RB, Construction and Revitalization Program, 5.00%, 05/01/34

    2,700       3,098,061  
   

 

 

 
      4,681,700  
Massachusetts — 1.2%  

Massachusetts Development Finance Agency, RB, Emerson College Issue, Series A:

   

5.00%, 01/01/47

    245       264,081  

5.25%, 01/01/42

    545       599,467  

Massachusetts Development Finance Agency, Refunding RB, Emerson College, Series A, 5.00%, 01/01/40

    595       649,252  

Massachusetts HFA, Refunding RB, Series C, AMT, 5.35%, 12/01/42

    595       605,758  
   

 

 

 
      2,118,558  
Michigan — 1.1%  

Royal Oak Hospital Finance Authority Michigan, Refunding RB, William Beaumont Hospital, Series V, 8.25%, 09/01/18(a)

    1,910       1,950,454  
   

 

 

 
Minnesota — 1.1%  

City of Minneapolis Minnesota, Refunding RB, Fairview Health Services, Series B (AGC):

   

6.50%, 11/15/18(a)

    205       210,150  

6.50%, 11/15/38

    1,120       1,147,888  
Security   Par
(000)
    Value  
Minnesota (continued)  

County of St. Paul Minnesota Housing & Redevelopment Authority, Refunding RB, Fairview Health Services, Series A, 4.00%, 11/15/43

  $ 575     $ 585,505  
   

 

 

 
      1,943,543  
Mississippi — 2.4%  

Mississippi Development Bank, RB, Jackson Water & Sewer System Project (AGM), 6.88%, 12/01/40

    2,595       3,124,354  

Mississippi State University Educational Building Corp., Refunding RB, Mississippi State University Improvement Project, 5.25%, 08/01/23(a)

    1,000       1,146,590  
   

 

 

 
      4,270,944  
Montana — 0.3%  

Montana State Board of Housing, RB, S/F, Series B-2:

   

3.38%, 12/01/37

    245       237,969  

3.50%, 12/01/42

    105       102,123  

3.60%, 12/01/47

    165       160,020  
   

 

 

 
      500,112  
Nevada — 4.8%  

City of Carson City Nevada, Refunding RB, Carson Tahoe Regional Healthcare Project, 5.00%, 09/01/42

    340       368,169  

County of Clark Nevada, ARB, Las Vegas-McCarran International Airport, Series A (AGM), 5.25%, 07/01/39

    1,410       1,481,262  

County of Clark Nevada, GO:

   

Limited Tax, 5.00%, 06/01/18(a)

    3,500       3,509,240  

Stadium Improvement, Series A, 5.00%,
06/01/36(b)

    1,205       1,387,232  

County of Clark Nevada Water Reclamation District, GO, Series A, 5.25%, 07/01/19(a)

    1,500       1,558,065  
   

 

 

 
      8,303,968  
New Jersey — 8.6%  

New Jersey EDA, RB, Goethals Bridge Replacement Project, AMT, Private Activity Bond:

   

5.38%, 01/01/43

    3,000       3,268,890  

(AGM), 5.00%, 01/01/31

    790       871,710  

New Jersey Health Care Facilities Financing Authority, RB, Virtua Health, Series A (AGC), 5.50%, 07/01/38

    2,100       2,182,845  

New Jersey Transportation Trust Fund Authority, RB, Transportation System:

   

Series A (AGC), 5.63%, 12/15/28

    3,170       3,242,688  

Series AA, 5.50%, 06/15/39

    1,890       2,019,068  

Series B, 5.25%, 06/15/36

    1,000       1,039,840  

Tobacco Settlement Financing Corp., Refunding RB:

   

Series A, 5.25%, 06/01/46

    1,190       1,321,650  

Sub-Series B, 5.00%, 06/01/46

    905       949,544  
   

 

 

 
      14,896,235  
New York — 7.4%  

City of New York New York, GO, Series F-1, 5.00%, 04/01/36

    2,090       2,409,289  

City of New York New York Municipal Water Finance Authority, Refunding RB, Water & Sewer System, 2nd General Resolution, Series EE, 5.38%, 06/15/43

    1,305       1,411,958  

City of New York New York Water & Sewer System, Refunding RB, 2nd General Resolution, Fiscal 2009, Series EE, 5.25%, 06/15/40

    3,410       3,529,691  

Hudson Yards Infrastructure Corp., RB, Senior, Fiscal 2012:

   

5.75%, 02/15/21(a)

    1,555       1,711,760  

5.75%, 02/15/47

    955       1,032,622  

Port Authority of New York & New Jersey, Refunding ARB, Consolidated, 166th Series, 5.25%, 07/15/36

    2,000       2,156,960  

TSASC, Inc., Refunding RB, Series A, 5.00%, 06/01/41

    535       574,965  
   

 

 

 
      12,827,245  
 

 

 

SCHEDULES OF INVESTMENTS      51  


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniHoldings Quality Fund, Inc. (MUS)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Ohio — 1.3%  

State of Ohio Turnpike Commission, RB, Junior Lien, Infrastructure Projects, Series A-1, 5.25%, 02/15/31

  $ 2,000     $ 2,218,920  
   

 

 

 
Oklahoma — 0.6%  

Oklahoma Development Finance Authority, RB, Provident Oklahoma Education Resources, Inc., Cross Village Student Housing Project, Series A, 5.25%, 08/01/57

    955       1,018,297  
   

 

 

 
Pennsylvania — 3.0%  

County of Montgomery Higher Education & Health Authority, Refunding RB, Thomas Jeferson University, Series A, 5.00%, 09/01/48(b)

    980       1,082,283  

County of Westmoreland Pennsylvania Municipal Authority, Refunding RB, (BAM), 5.00%, 08/15/36

    1,290       1,457,506  

Pennsylvania Housing Finance Agency, RB, S/F, Series 125B, 3.65%, 10/01/42

    1,395       1,355,368  

Pennsylvania Turnpike Commission, RB, Sub-Series B-1, 5.25%, 06/01/47

    170       189,467  

Township of Bristol Pennsylvania School District, GO, 5.25%, 06/01/37

    1,000       1,099,830  
   

 

 

 
      5,184,454  
South Carolina — 6.0%  

County of Charleston South Carolina, RB, Special Source, 5.25%, 12/01/38

    2,180       2,480,666  

County of Charleston South Carolina Airport District, ARB, Series A, AMT:

   

5.50%, 07/01/38

    1,000       1,105,120  

6.00%, 07/01/38

    1,695       1,913,146  

5.50%, 07/01/41

    1,000       1,103,620  

State of South Carolina Ports Authority, RB, AMT, 5.25%, 07/01/50

    1,095       1,209,603  

State of South Carolina Public Service Authority, Refunding RB, Series E, 5.25%, 12/01/55

    2,500       2,719,575  
   

 

 

 
      10,531,730  
Tennessee — 1.6%  

Metropolitan Nashville Airport Authority, ARB, Series B, AMT, 5.00%, 07/01/40

    2,500       2,762,350  
   

 

 

 
Texas — 13.2%  

Austin Community College District Public Facility Corp., RB, Educational Facilities Project, Round Rock Campus, 5.25%, 08/01/18(a)

    2,500       2,521,150  

City of Beaumont Texas, GO, Certificates of Obligation, 5.25%, 03/01/37

    1,360       1,510,158  

City of Houston Texas Combined Utility System Revenue, Refunding RB, Combined 1st Lien, Series A (AGC):

   

6.00%, 05/15/19(a)

    3,790       3,948,649  

6.00%, 11/15/35

    210       219,011  

Dallas Texas Area Rapid Transit, Refunding RB, Senior Lien(a):

   

5.25%, 12/01/18

    1,490       1,520,053  

5.25%, 12/01/18

    1,110       1,132,389  

Dallas-Fort Worth Texas International Airport, ARB, Joint Improvement, AMT:

   

Series A, 5.00%, 11/01/38

    2,965       3,116,156  

Series H, 5.00%, 11/01/37

    2,200       2,350,326  

Lower Colorado River Authority, Refunding RB,
5.50%, 05/15/33

    1,240       1,402,452  

North Texas Tollway Authority, RB, Special Projects, Series A, 5.50%, 09/01/21(a)

    3,150       3,486,263  

North Texas Tollway Authority, Refunding RB,
1st Tier-Series A, 5.00%, 01/01/43

    910       1,024,241  

Red River Texas Education Financing Corp., RB, Texas Christian University Project, 5.25%, 03/15/38

    620       688,677  
   

 

 

 
      22,919,525  
Security   Par
(000)
    Value  
Vermont — 0.9%  

University of Vermont & State Agricultural College, Refunding RB, 5.00%, 10/01/43

  $ 1,470     $ 1,656,822  
   

 

 

 
Virginia — 2.6%  

City of Lexington Virginia IDA, RB, Washington & Lee University, 5.00%, 01/01/43

    570       617,493  

State of Virginia Public School Authority, RB, Fluvanna County School Financing, 6.50%, 12/01/18(a)

    1,300       1,335,568  

Virginia Small Business Financing Authority, RB, Transform 66 P3 Project, AMT, 5.00%, 12/31/49

    2,330       2,512,695  
   

 

 

 
      4,465,756  
Washington — 5.6%  

City of Seattle Washington Municipal Light & Power, Refunding RB, Series A, 5.25%, 02/01/21(a)

    1,375       1,493,057  

Port of Seattle Washington, ARB, Intermediate Lien, Series C, AMT:

   

5.00%, 05/01/37

    1,450       1,634,527  

5.00%, 05/01/42

    385       430,819  

State of Washington, GO:

   

Series C, 5.00%, 02/01/36

    4,300       4,978,626  

Various Purposes, Series B, 5.25%, 02/01/21(a)

    1,075       1,167,300  
   

 

 

 
      9,704,329  
Wyoming — 0.2%  

State of Wyoming Municipal Power Agency, Inc., Refunding RB, Series A (BAM), 5.00%, 01/01/42

    330       366,963  
   

 

 

 

Total Municipal Bonds — 135.3%
(Cost — $224,329,959)

 

    235,111,463  
   

 

 

 

Municipal Bonds Transferred to Tender Option Bond Trusts(c)

 

California — 2.9%  

Sacramento Area Flood Control Agency, Refunding, Consolidated Capital Assessment District No. 2 Bonds, 5.00%, 10/01/47

    4,500       5,106,503  
   

 

 

 
Connecticut — 1.1%  

State of Connecticut Health & Educational Facility Authority, Refunding RB, Trinity Health Credit Group, 5.00%, 12/01/45

    1,771       1,968,085  
   

 

 

 
District of Columbia — 0.6%  

District of Columbia Water & Sewer Authority, Refunding RB, Series A, 6.00%, 10/01/18(a)(d)

    1,039       1,057,047  
   

 

 

 
Florida — 4.3%  

County of Miami-Dade Florida, GO, Building Better Communities Program, Series B-1, 6.00%, 07/01/18(a)

    7,500       7,552,538  
   

 

 

 
Illinois — 1.5%  

City of Chicago Illionis Waterworks Revenue, Refunding RB, Water Revenue Project (AGM), 2nd Lien:

   

2017, 5.25%, 11/01/18(a)

    1,662       1,687,144  

2017, 5.25%, 11/01/33

    482       489,629  

5.25%, 11/01/18(a)

    364       369,667  
   

 

 

 
      2,546,440  
Maryland — 1.0%  

City of Baltimore Maryland Water Utility Fund, RB, Wastewater Project, Series A, 5.00%, 07/01/46

    1,499       1,677,612  
   

 

 

 
Michigan — 1.9%  

Michigan State Building Authority, Refunding RB, Facilities Program, Series I, 5.00%, 10/15/45

    3,020       3,351,505  
   

 

 

 
 

 

 

52    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniHoldings Quality Fund, Inc. (MUS)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Nevada — 5.1%  

County of Clark Nevada Water Reclamation District, GO(a):

   

Limited Tax, 6.00%, 07/01/18

  $ 5,000     $ 5,035,025  

Series B, 5.50%, 07/01/19

    3,749       3,901,616  
   

 

 

 
      8,936,641  
New Jersey — 1.2%  

New Jersey Housing & Mortgage Finance Agency, RB, S/F Housing, Series CC, 5.25%, 10/01/29

    1,999       2,033,072  
   

 

 

 
New York — 5.4%  

City of New York New York Transitional Finance Authority, BARB, Fiscal 2009, Series S-3, 5.25%, 01/15/39

    1,400       1,431,255  

New York Liberty Development Corp., ARB, 1 World Trade Center Port Authority Consolidated Bonds, 5.25%, 12/15/43

    4,530       4,935,217  

New York Liberty Development Corp., Refunding RB, 4 World Trade Center Project, 5.75%, 11/15/51(d)

    2,660       2,943,435  
   

 

 

 
      9,309,907  
Pennsylvania — 0.8%  

County of Westmoreland Pennsylvania Municipal Authority, Refunding RB, (BAM), 5.00%, 08/15/38

    1,184       1,316,708  
   

 

 

 
Utah — 0.6%  

City of Riverton Utah, RB, IHC Health Services, Inc., 5.00%, 08/15/41

    1,005       1,042,003  
   

 

 

 
Virginia — 1.5%  

County of Fairfax Virginia EDA, RB, Metrorail Parking System Project, 5.00%, 04/01/47(d)

    2,320       2,627,783  
   

 

 

 

Total Municipal Bonds Transferred to Tender Option Bond Trusts — 27.9%
(Cost — $47,429,757)

 

    48,525,844  
   

 

 

 

Total Long-Term Investments — 163.2%
(Cost — $271,759,716)

 

    283,637,307  
   

 

 

 
Security       
Shares
    Value  
Short-Term Securities — 1.6%  

BlackRock Liquidity Funds, MuniCash, Institutional Class,
1.48% (e)(f)

    2,822,221     $ 2,822,221  
   

 

 

 

Total Short-Term Securities —1.6%
(Cost — $2,822,221)

 

    2,822,221  
   

 

 

 

Total Investments — 164.8%
(Cost — $274,581,937)

 

    286,459,528  

Other Assets Less Liabilities — 0.4%

 

    696,398  

Liability for TOB Trust Certificates, Including Interest Expense and Fees Payable — (15.1)%

 

    (26,337,756

VMTP Shares at Liquidation Value — (50.1)%

 

    (87,000,000
   

 

 

 

Net Assets Applicable to Common Shares — 100.0%

 

  $ 173,818,170  
   

 

 

 

 

(a) U.S. Government securities, held in escrow, are used to pay interest on this security, as well as to retire the bond in full at the date indicated, typically at a premium to par.
(b) When-issued security.
(c)  Represent bonds transferred to a TOB Trust in exchange of cash and residual certificates received by the Fund. These bonds serve as collateral in a secured borrowing. See Note 4 of the Notes to Financial Statements for details.
(d)  All or a portion of security is subject to a recourse agreement. The aggregate maximum potential amount the Fund could ultimately be required to pay under the agreements, which expire between October 1, 2018 to October 1, 2024, is $3,450,256. See Note 4 of the Notes to Financial Statements for details.
(e) Annualized 7-day yield as of period end.
 
(f)  During the year ended April 30, 2018, investments in issuers considered to be an affiliate of the Fund for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliated    Shares
Held at

04/30/17
     Net
Activity
     Shares
Held at
04/30/18
     Value at
04/30/18
     Income      Net
Realized
Gain (Loss)
 (a)
     Change in
Unrealized

Appreciation
(Depreciation)
 

BlackRock Liquidity Funds, MuniCash, Institutional Class

     5,580,695        (2,758,474      2,822,221      $ 2,822,221      $ 21,007      $ 2,303      $  
           

 

 

    

 

 

    

 

 

    

 

 

 

 

  (a)  Includes net capital gain distributions, if applicable.  

Derivative Financial Instruments Outstanding as of Period End

Futures Contracts

 

Description    Number of
Contracts
       Expiration
Date
       Notional
Amount (000)
       Value/
Unrealized
Appreciation
(Depreciation)
 

Short Contracts:

                 

10-Year U.S. Treasury Note

     28          06/20/18        $ 3,350        $ 21,502  

Long U.S. Treasury Bond

     28          06/20/18          4,028          19,382  

5-Year U.S. Treasury Note

     14          06/29/18          1,589          8,293  
                 

 

 

 
                  $ 49,177  
                 

 

 

 

 

 

SCHEDULES OF INVESTMENTS      53  


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniHoldings Quality Fund, Inc. (MUS)

 

Derivative Financial Instruments Categorized by Risk Exposure

As of year end, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:

 

      Commodity
Contracts
       Credit
Contracts
       Equity
Contracts
       Foreign
Currency
Exchange
Contracts
       Interest
Rate
Contracts
       Other
Contracts
       Total  

Assets — Derivative Financial Instruments

                                

Futures contracts

                                

Net unrealized appreciation(a)

   $        $        $        $        $ 49,177        $        $ 49,177  
  

 

 

      

 

 

      

 

 

      

 

 

      

 

 

      

 

 

      

 

 

 

 

  (a)  Includes cumulative appreciation (depreciation) on futures contracts if any, as reported in the Schedule of Investments. Only current day’s variation margin is reported within the Statements of Assets and Liabilities.  

For the year ended April 30, 2018, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

      Commodity
Contracts
       Credit
Contracts
       Equity
Contracts
       Foreign
Currency
Exchange
Contracts
       Interest
Rate
Contracts
       Other
Contracts
       Total  

Net Realized Gain (Loss) from:

 

Futures contracts

   $        $        $        $        $ 391,526        $        $ 391,526  
  

 

 

      

 

 

      

 

 

      

 

 

      

 

 

      

 

 

      

 

 

 
Net Change in Unrealized Appreciation (Depreciation) on:  

Futures contracts

   $        $        $        $        $ 181,278        $        $ 181,278  
  

 

 

      

 

 

      

 

 

      

 

 

      

 

 

      

 

 

      

 

 

 

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

Futures contracts:

 

Average notional value of contracts — short

   $ 10,430,582  

For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements

Fair Value Hierarchy as of Period End

Various inputs are used in determining the fair value of investments and derivative financial instruments. For information about the Fund’s policy regarding valuation of investments and derivative financial instruments, refer to the Notes to Financial Statements.

The following tables summarize the Fund’s investments and derivative financial instruments categorized in the disclosure hierarchy:

 

      Level 1        Level 2        Level 3        Total  

Assets:

 

Investments:

 

Long-Term Investments(a)

   $        $ 283,637,307        $             —        $ 283,637,307  

Short-Term Securities

     2,822,221                            2,822,221  
  

 

 

      

 

 

      

 

 

      

 

 

 
   $ 2,822,221        $ 283,637,307        $        $ 286,459,528  
  

 

 

      

 

 

      

 

 

      

 

 

 

Derivative Financial Instruments(b)

 

Assets:

 

Interest rate contracts

   $ 49,177        $        $        $ 49,177  
  

 

 

      

 

 

      

 

 

      

 

 

 

 

  (a)  See above Schedule of Investments for values in each state or political subdivision.  
  (b)  Derivative financial instruments are futures contracts which are valued at the unrealized appreciation (depreciation) on the instrument.  

The Fund may hold assets and/or liabilities in which the fair value approximates the carrying amount for financial statement purposes. As of period end, such assets and/or liabilities are categorized within the disclosure hierarchy as follows:

 

      Level 1        Level 2        Level 3        Total  

Liabilities:

 

TOB Trust Certificates

   $        $ (26,238,374      $        $ (26,238,374

VMTP Shares at Liquidation Value

              (87,000,000                 (87,000,000
  

 

 

      

 

 

      

 

 

      

 

 

 
   $             —        $ (113,238,374      $             —        $ (113,238,374
  

 

 

      

 

 

      

 

 

      

 

 

 

During the year ended April 30, 2018, there were no transfers between levels.

See notes to financial statements.

 

 

54    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments

April 30, 2018

  

BlackRock Muni Intermediate Duration Fund, Inc. (MUI)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  

Municipal Bonds — 138.3%

 

Alabama — 0.8%  

City of Birmingham Alabama Special Care Facilities Financing Authority, RB, Children’s Hospital (AGC), 6.00%, 06/01/19(a)

  $ 4,615     $ 4,818,383  
   

 

 

 
Arizona — 3.4%  

Arizona Board of Regents, RB, University of Arizona, 5.00%, 08/01/28

    2,000       2,159,480  

Arizona Health Facilities Authority, Refunding RB, Phoenix Children’s Hospital, Series A, 5.00%, 02/01/30

    2,685       2,864,036  

Arizona Industrial Development Authority, RB, Academies of Math & Science Projects, Series B, 4.25%, 07/01/27(b)

    590       575,527  

City of Phoenix Arizona IDA, RB, Facility, Legacy Traditional Schools Project, Series A, 5.75%, 07/01/24(b)

    750       803,798  

City of Tucson Arizona, COP, Refunding, (AGC), 4.00%, 07/01/20

    2,325       2,418,930  

County of Pinal Arizona Electric District No. 3, Refunding RB, 5.00%, 07/01/21(a)

    1,600       1,742,304  

Glendale Union School District No. 205, GO, Series C (BAM):

   

5.00%, 07/01/24

    1,945       2,172,137  

5.00%, 07/01/27

    500       553,540  

Phoenix-Mesa Gateway Airport Authority, RB, Mesa Project, AMT:

   

5.00%, 07/01/27

    700       755,811  

5.00%, 07/01/32

    1,925       2,065,987  

Scottsdale IDA, Refunding RB, Scottsdale Healthcare, Series C (AGM), 5.00%, 09/01/35

    2,050       2,170,048  

State of Arizona, COP, Department of Administration, Series A (AGM), 4.25%, 10/01/23

    1,000       1,028,510  
   

 

 

 
      19,310,108  
Arkansas — 0.9%  

City of Benton Arkansas, RB, 5.00%, 06/01/29

    1,055       1,171,462  

University of Arkansas, Refunding RB:

   

5.00%, 03/01/31

    2,315       2,620,325  

5.00%, 03/01/34

    1,270       1,428,280  
   

 

 

 
      5,220,067  
California — 4.2%  

California Health Facilities Financing Authority, RB, Sutter Health, Series B, 5.00%, 08/15/20(a)

    2,135       2,283,809  

California Infrastructure & Economic Development Bank, Refunding RB, 4.00%, 11/01/31

    1,335       1,395,983  

City of San Jose California, Refunding ARB, AMT:

   

Norman Y Mineta San Jose International Airport SJC, Series A, 5.00%, 03/01/30

    500       572,460  

Series A-1, 5.00%, 03/01/25

    2,000       2,140,280  

City of San Jose California, Refunding RB, Norman Y Mineta San Jose International Airport SJC, AMT, Series A, 5.00%, 03/01/29

    1,250       1,435,313  

Golden State Tobacco Securitization Corp., Refunding RB, Series A-1, 5.00%, 06/01/26

    5,000       5,705,050  

Sacramento County CA Airport System Revenue, Refunding RB, Series C, AMT, 5.00%, 07/01/32(c)

    2,570       2,961,257  

State of California, GO:

   

5.50%, 04/01/28

    15       15,045  

Various Purposes, 5.75%, 04/01/31

    7,000       7,249,410  
   

 

 

 
      23,758,607  
Colorado — 0.5%  

Colorado Health Facilities Authority, Refunding RB, Catholic Health Initiatives, Series B-1, 5.00%, 07/01/38

    270       284,132  

Park Creek Metropolitan District, Refunding, Tax Allocation Bonds, 5.00%, 12/01/34

    500       555,165  

University of Northern Colorado, Refunding RB, Series A, 5.00%, 06/01/31

    2,000       2,227,820  
   

 

 

 
      3,067,117  
Security   Par
(000)
    Value  
Connecticut — 2.6%  

Connecticut State Health & Educational Facility Authority, Refunding RB, Lawrence & Memorial Hospital, Series F, 5.00%, 07/01/31

  $ 4,530     $ 4,801,347  

State of Connecticut, GO, Series A:

   

5.00%, 04/15/30

    5,000       5,634,600  

5.00%, 04/15/31

    4,000       4,486,240  
   

 

 

 
      14,922,187  
Florida — 7.3%  

Capital Region Community Development District, Refunding, Special Assessment Bonds, Series A-1:

   

4.13%, 05/01/23

    500       499,105  

4.63%, 05/01/28

    500       498,415  

County of Broward Florida School Board, COP, Refunding, Series A (AGM), 5.00%, 07/01/21(a)

    10,000       10,905,400  

County of Lee Florida, Refunding ARB, Series A, AMT (AGM), 5.00%, 10/01/27

    1,635       1,764,737  

County of Lee Florida, Refunding RB, Series A, AMT, 5.50%, 10/01/23

    1,000       1,097,360  

County of Miami-Dade Florida, RB, AMT, Series B:

   

6.00%, 10/01/28

    3,470       3,954,898  

6.00%, 10/01/29

    3,480       3,962,572  

County of Miami-Dade Florida Educational Facilities Authority, Refunding RB, Series A, 5.00%, 04/01/32

    5,020       5,615,975  

County of Miami-Dade Florida Transit System Sales Surtax Revenue, Refunding RB, 5.00%, 07/01/32

    1,500       1,639,905  

County of Miami-Dade Florida Water & Sewer System Revenue, Refunding RB, Series C (BHAC), 5.00%, 10/01/18(a)

    8,000       8,107,920  

Lakewood Ranch Stewardship District, Special Assessment Bonds:

   

Del Webb Project, 3.65%, 05/01/22(b)

    525       525,929  

Del Webb Project, 4.30%, 05/01/27(b)

    520       520,296  

Lakewood National and Polo Run Projects, 4.00%, 05/01/22(c)

    1,230       1,234,354  

Midtown Miami Community Development District, Refunding, Special Assessment Bonds, Series A, 4.25%, 05/01/24(c)

    1,300       1,339,533  

Sterling Hill Community Development District, Refunding, Special Assessment Bonds, Series B, 5.50%, 11/01/10(d)(e)

    143       91,229  
   

 

 

 
      41,757,628  
Georgia — 3.2%  

City of Atlanta Georgia Water & Wastewater Revenue, Refunding RB, 5.00%, 11/01/32

    10,315       11,761,988  

County of Cobb Kennestone Hospital Authority, Refunding RB, Revenue Anticipation Certificates:

   

5.00%, 04/01/31

    800       908,232  

5.00%, 04/01/32

    1,250       1,411,888  

County of Fulton Development Authority, RB, Revenue Anticipation Certificates, Series A, 5.00%, 04/01/32

    1,000       1,129,510  

Main Street Natural Gas Inc, RB, Series A, 5.50%, 09/15/28

    2,500       2,986,850  
   

 

 

 
      18,198,468  
Hawaii — 0.9%  

State of Hawaii Airports System, Refunding ARB, Series A, 5.25%, 07/01/29

    5,000       5,344,500  
   

 

 

 
Illinois — 15.2%  

Chicago Board of Education, GO, Refunding Dedicated Revenues, Series D, 5.00%, 12/01/26

    4,185       4,408,563  

City of Chicago Illinois Midway International Airport, Refunding ARB, 2nd Lien, Series A, AMT:

   

5.00%, 01/01/32

    5,000       5,432,950  

5.50%, 01/01/32

    1,500       1,649,670  

City of Chicago Illinois O’Hare International Airport, Refunding GARB, AMT, Series C:

   

5.25%, 01/01/28

    1,350       1,474,470  

5.25%, 01/01/29

    3,020       3,291,589  
 

 

 

SCHEDULES OF INVESTMENTS      55  


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock Muni Intermediate Duration Fund, Inc. (MUI)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Illinois (continued)  

City of Chicago Illinois O’Hare International Airport, RB, Refunding GARB, 5.00%, 01/01/32

  $ 3,745     $ 4,163,129  

City of Chicago Illinois O’Hare International Airport, Refunding GARB, Senior Lien, Series A, AMT, 5.00%, 01/01/23

    13,000       14,319,500  

City of Chicago Illinois Transit Authority, RB, 5.25%, 12/01/31

    3,700       3,970,137  

Cook County Community College District No. 508, GO, City College of Chicago, 5.13%, 12/01/38

    1,000       1,032,000  

Illinois Finance Authority, Refunding RB, CHF-Chicago, LLC-University Of Illinois at Chicago:

   

5.00%, 02/15/27

    500       550,715  

5.00%, 02/15/28

    810       890,733  

5.00%, 02/15/29

    400       437,568  

5.00%, 02/15/30

    500       544,915  

5.00%, 02/15/31

    500       542,880  

5.00%, 02/15/32

    500       540,855  

Madison-Macoupin Etc. Counties Community College District No. 536, GO, Refunding, Lewis & Clark Community College:

   

5.00%, 05/01/30

    475       497,330  

5.00%, 05/01/31

    500       523,405  

5.00%, 05/01/32

    500       522,610  

Metropolitan Pier & Exposition Authority, Refunding RB, McCormick Place Expansion Project, 5.00%, 12/15/28

    1,200       1,303,980  

Railsplitter Tobacco Settlement Authority, RB:

   

5.50%, 06/01/21(a)

    3,500       3,849,825  

5.00%, 06/01/28

    1,110       1,254,622  

State of Illinois, GO:

   

5.25%, 02/01/30

    5,000       5,149,400  

5.00%, 04/01/31

    1,000       1,014,780  

5.00%, 05/01/31

    10,000       10,144,800  

Series D, 5.00%, 11/01/28

    1,645       1,705,421  

State of Illinois Finance Authority, Refunding RB, Southern Illinois Healthcare Enterprises, Inc.:

   

5.00%, 03/01/30

    550       621,093  

5.00%, 03/01/32

    920       1,026,968  

State of Illinois Toll Highway Authority, RB, Series A, 5.00%, 01/01/34

    9,140       9,992,213  

State of Illinois Toll Highway Authority, Refunding RB, Senior Series A, 5.00%, 12/01/31

    5,220       5,945,162  
   

 

 

 
      86,801,283  
Indiana — 4.1%  

City of Whiting Indiana, RB, BP Products North America, Inc. Project, 5.25%, 01/01/21

    4,800       5,164,992  

County of Jasper Indiana, Refunding RB, Northern Indiana Public Service Co., Series C (NPFGC), 5.85%, 04/01/19

    2,000       2,067,460  

Indiana Finance Authority, RB, Wastewater, 1st Lien, Series A, 5.25%, 10/01/31

    10,000       10,935,500  

Indiana Finance Authority, Refunding RB, US Steel Corp. Project, 6.00%, 12/01/19

    5,000       5,175,600  
   

 

 

 
      23,343,552  
Iowa — 1.1%  

Iowa Higher Education Loan Authority, RB, Private College Facility:

   

5.25%, 04/01/23

    695       752,859  

5.25%, 04/01/24

    730       790,772  

5.25%, 04/01/25

    520       563,290  

5.25%, 04/01/26

    360       389,758  

Iowa Higher Education Loan Authority, Refunding RB, Private College Facility:

   

5.00%, 09/01/20(a)

    2,315       2,469,572  

Upper Iowa University Project, 5.00%, 09/01/20(f)

    1,000       1,043,290  
   

 

 

 
      6,009,541  
Security   Par
(000)
    Value  
Kansas — 1.4%  

County of Seward Unified School District No. 480 Liberal, GO, Refunding:

   

5.00%, 09/01/22(a)

  $ 1,005     $ 1,112,706  

5.00%, 09/01/22(a)

    3,990       4,447,214  

5.00%, 09/01/33

    1,005       1,111,399  

Kansas Development Finance Authority, Refunding RB, Health Hospital Nursing Home Improvements:

   

5.00%, 11/15/19(a)

    35       36,521  

5.00%, 11/15/23

    1,465       1,532,053  
   

 

 

 
      8,239,893  
Kentucky — 0.5%  

County of Louisville/Jefferson Metropolitan Government, Refunding RB, Catholic Health Initiatives:

   

5.00%, 12/01/35

    120       126,041  

Series A, 5.00%, 12/01/31

    2,750       2,914,092  
   

 

 

 
      3,040,133  
Louisiana — 3.7%  

City of Bossier City Louisiana Utilities, Refunding RB, 5.00%, 10/01/32

    2,000       2,269,200  

City of New Orleans Louisiana Aviation Board, Refunding GARB, Restructuring, Series A-2 (AGC), 6.00%, 01/01/19(a)

    850       873,775  

Louisiana Local Government Environmental Facilities & Community Development Authority, Refunding RB, BRCC Facilities Corp. Project:

   

5.00%, 12/01/27

    3,445       3,732,003  

5.00%, 12/01/28

    3,715       4,023,159  

New Orleans Aviation Board, RB:

   

General Airport, North Terminal Project, Series B, AMT, 5.00%, 01/01/32

    800       898,520  

Series A, 5.00%, 01/01/32

    1,000       1,107,210  

Series A, 5.00%, 01/01/33

    1,000       1,104,050  

State of Louisiana Gasoline & Fuels Tax Revenue, Refunding RB, 4.00%, 05/01/34

    3,000       3,115,650  

Terrebonne Levee & Conservation District, RB, Sales Tax, 5.00%, 07/01/28

    3,660       4,042,653  
   

 

 

 
      21,166,220  
Maine — 0.3%  

Portland Housing Development Corp., Refunding RB, Senior Living, Retirement Facilities, Series A, 6.00%, 02/01/34

    1,965       1,967,594  
   

 

 

 
Maryland — 2.0%  

City of Rockville Maryland, RB, Ingleside King Farm Project, 3.50%, 11/01/26

    1,825       1,811,732  

Maryland Economic Development Corp., RB, Transportation Facilities Project, Series A, 5.13%, 06/01/20(f)

    1,375       1,444,561  

Maryland Economic Development Corp., Refunding RB, Transportation Facilities Project, Series A:

   

5.00%, 06/01/29

    1,835       2,077,899  

5.00%, 06/01/30

    1,015       1,148,939  

5.00%, 06/01/31

    1,000       1,130,060  

5.00%, 06/01/32

    1,000       1,127,380  

Maryland Health & Higher Educational Facilities Authority, RB, Johns Hopkins Health System, Series B, 5.00%, 07/01/33

    1,140       1,253,898  

Maryland Health & Higher Educational Facilities Authority, Refunding RB, 5.00%, 07/01/33

    1,500       1,648,125  
   

 

 

 
      11,642,594  
Massachusetts — 1.7%  

Massachusetts Development Finance Agency, Refunding RB:

   

Emerson College Issue, Series A, 5.00%, 01/01/31

    1,730       1,884,039  

Suffolk University, 5.00%, 07/01/29

    2,700       3,058,020  

Suffolk University, 5.00%, 07/01/30

    3,125       3,520,969  

Massachusetts Health & Educational Facilities Authority, Refunding RB, Winchester Hospital, 5.00%, 07/01/25

    1,060       1,116,593  
   

 

 

 
      9,579,621  
 

 

 

56    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock Muni Intermediate Duration Fund, Inc. (MUI)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Michigan — 2.5%  

County of Wayne Airport Authority, Refunding ARB, Junior Lien Series B, AMT, 5.00%, 12/01/30

  $ 700     $ 792,127  

Manistee Area Public Schools, GO, Refunding, (Q-SBLF), 5.00%, 05/01/25

    1,000       1,082,900  

Michigan Finance Authority, Refunding RB, Senior Lien, Detroit Water and Sewer, Series C-3 (AGM), 5.00%, 07/01/31

    4,000       4,439,880  

Michigan State Building Authority, Refunding RB, Facilities Program, Series II-A, 5.00%, 10/15/24

    2,500       2,722,800  

Michigan State Hospital Finance Authority, Refunding RB, Henry Ford Health System, 5.25%, 11/15/19(a)

    4,900       5,142,746  
   

 

 

 
      14,180,453  
Minnesota — 1.2%  

City of Minneapolis, RB, YMCA of the Greater Twin Cities Project:

   

4.00%, 06/01/30

    150       157,500  

4.00%, 06/01/31

    50       52,211  

County of St. Paul Minnesota Housing & Redevelopment Authority, RB, Great River School Project, Series A, 4.75%, 07/01/29(b)

    250       251,832  

University of Minnesota, RB, Biomedical Science Research Facilities Funding Program:

   

Series B, 5.00%, 08/01/36

    1,000       1,081,700  

Series C, 5.00%, 08/01/27

    1,390       1,559,844  

Series C, 5.00%, 08/01/28

    740       829,644  

Series C, 5.00%, 08/01/29

    1,555       1,740,947  

Series C, 5.00%, 08/01/30

    835       933,538  
   

 

 

 
      6,607,216  
Missouri — 0.2%  

City of St. Louis Missouri IDA, Refunding RB, Ballpark Village Development Project, Series A, 3.88%, 11/15/29

    395       397,425  

St. Louis County Industrial Development Authority, Refunding RB, Friendship Village St. Louis Obligated Group:

   

5.00%, 09/01/27

    360       404,482  

5.00%, 09/01/32

    500       547,560  
   

 

 

 
      1,349,467  
Montana — 0.1%  

County of Yellowstone Montana School District No. 2 Billings, GO, 5.00%, 06/15/30

    500       556,695  
   

 

 

 
Nebraska — 0.9%  

County of Douglas Nebraska Hospital Authority No. 3, Refunding RB, 5.00%, 11/01/30

    800       894,184  

County of Lancaster Nebraska Hospital Authority No. 1, Refunding RB, Immanuel Obligation Group, 5.50%, 01/01/30

    1,000       1,053,420  

Nebraska Public Power District, Refunding RB, Series A:

   

5.00%, 01/01/30

    1,000       1,085,510  

5.00%, 01/01/32

    2,000       2,163,740  
   

 

 

 
      5,196,854  
Nevada — 1.7%  

County of Clark Nevada Department of Aviation, Refunding RB, 5.00%, 07/01/33

    5,000       5,558,750  

County of Humboldt Nevada, Refunding RB, Idaho Power Co. Project, 5.15%, 12/01/24

    3,800       3,948,238  
   

 

 

 
      9,506,988  
New Hampshire — 0.4%  

New Hampshire Health & Education Facilities Authority Act, Refunding RB, Dartmouth-Hitchcock Obligated Group, Series A:

   

5.00%, 08/01/30

    1,000       1,148,750  

5.00%, 08/01/31

    640       730,022  

5.00%, 08/01/32

    365       413,414  
   

 

 

 
      2,292,186  
Security   Par
(000)
    Value  
New Jersey — 26.0%  

County of Essex New Jersey Improvement Authority, LRB, Newark Project, Series A (AGM), 5.00%, 11/01/20

  $ 2,000     $ 2,083,200  

New Jersey EDA, RB, AMT:

   

Continental Airlines, Inc. Project, 5.13%, 09/15/23

    6,040       6,519,999  

Goethals Bridge Replacement Project, Private Activity Bond, 5.50%, 01/01/26

    1,500       1,702,290  

Goethals Bridge Replacement Project, Private Activity Bond, 5.50%, 01/01/27

    1,000       1,130,960  

New Jersey EDA, Refunding ARB, Port Newark Container Terminal LLC Project, AMT:

   

5.00%, 10/01/26

    2,135       2,366,605  

5.00%, 10/01/27

    1,680       1,869,185  

New Jersey EDA, Refunding RB:

   

Provident Group-Montclair Properties LLC (AGM), 5.00%, 06/01/28

    1,000       1,146,790  

Provident Group-Montclair Properties LLC (AGM), 5.00%, 06/01/29

    1,000       1,141,700  

New Jersey American Water Co., Series E, AMT, 4.70%, 12/01/25

    3,000       3,137,850  

School Facilities Construction, Series AA, 4.25%, 12/15/24

    3,850       3,881,724  

School Facilities Construction, Series EE, 5.00%, 09/01/23

    3,465       3,640,017  

New Jersey Educational Facilities Authority, RB, Higher Education Facilities Trust Fund, 5.00%, 06/15/28

    10,000       10,649,300  

New Jersey Educational Facilities Authority, Refunding RB, 5.00%, 07/01/30

    5,000       5,602,500  

New Jersey Health Care Facilities Financing Authority, Refunding RB, St. Joseph Health System Obligated Group Issue, 5.00%, 07/01/30

    1,595       1,748,120  

New Jersey Higher Education Student Assistance Authority, Refunding RB:

   

Series 1, AMT, 5.50%, 12/01/26

    1,000       1,061,540  

Student Loan, Series 1A, 4.75%, 12/01/21

    1,275       1,320,007  

New Jersey State Turnpike Authority, RB, Series E, 5.00%, 01/01/32

    12,000       13,355,040  

New Jersey State Turnpike Authority, Refunding RB, Series B, 5.00%, 01/01/29

    10,000       10,964,400  

New Jersey Transportation Trust Fund Authority, RB:

   

Federal Highway Reimbursement Revenue Notes, Series A, 5.00%, 06/15/30

    2,000       2,185,240  

Series B, 5.25%, 06/15/26

    3,500       3,724,140  

Transportation Program, Series AA, 5.25%, 06/15/31

    12,000       12,767,640  

Transportation Program, Series AA, 5.25%, 06/15/32

    2,250       2,441,520  

Transportation System, Series A, 5.25%, 06/15/24

    3,185       3,397,758  

Transportation System, Series B, 5.50%, 06/15/31

    13,970       14,796,745  

Transportation System, Series C, 5.25%, 06/15/32

    10,000       10,756,300  

Newark Housing Authority, RB, Series A:

   

5.00%, 12/01/23

    1,230       1,378,707  

5.00%, 12/01/25

    1,345       1,509,413  

South Jersey Port Corp., ARB, Sobordinated Marine Terminal, Series B, AMT:

   

5.00%, 01/01/29

    250       276,835  

5.00%, 01/01/30

    200       220,612  

5.00%, 01/01/31

    350       383,985  

5.00%, 01/01/32

    425       463,033  

South Jersey Port Corp., RB, Marine Terminal, Series O-1 (AGC), 4.63%, 01/01/19(a)

    1,375       1,401,042  

State of New Jersey, GO, Various Purposes, 5.00%, 06/01/28

    5,000       5,562,700  

Tobacco Settlement Financing Corp., Refunding RB, Series A:

   

5.00%, 06/01/30

    500       565,955  

5.00%, 06/01/32

    7,000       7,847,350  

5.00%, 06/01/33

    5,200       5,801,432  
   

 

 

 
      148,801,634  
 

 

 

SCHEDULES OF INVESTMENTS      57  


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock Muni Intermediate Duration Fund, Inc. (MUI)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
New Mexico — 1.2%  

Albuquerque Municipal School District No. 12, GO, Series 2017, 5.00%, 08/01/30

  $ 1,250     $ 1,453,212  

County of Albuquerque Bernalillo New Mexico Water Utility Authority, Refunding RB, 4.00%, 07/01/33

    2,510       2,639,215  

New Mexico Hospital Equipment Loan Council, Refunding RB, 5.00%, 08/01/31

    2,500       2,823,400  
   

 

 

 
      6,915,827  
New York — 14.8%  

City of New York New York, GO, Refunding, Series A, 5.00%, 08/01/29

    6,125       7,037,686  

City of New York New York, GO:

   

Sub-Series B-1, 5.25%, 09/01/22

    4,250       4,298,960  

Sub-Series I-1, 5.50%, 04/01/19(a)

    3,310       3,421,084  

Sub-Series I-1, 5.50%, 04/01/21

    1,690       1,746,547  

City of New York New York Transitional Finance Authority, BARB, Fiscal 2009, Series S-3, 5.00%, 01/15/23

    3,560       3,640,634  

Counties of Buffalo & Erie New York Industrial Land Development Corp., Refunding RB, The Charter School for Applied Technologies Project, Series A:

   

4.00%, 06/01/22

    1,000       1,029,970  

4.50%, 06/01/27

    1,710       1,797,125  

5.00%, 06/01/35

    415       437,273  

County of Monroe New York Industrial Development Corp., Refunding RB, Series A, 5.00%, 07/01/23(a)

    5,695       6,466,217  

County of Westchester New York Healthcare Corp., Refunding RB, Senior Lien, Remarketing, Series A:

   

5.00%, 11/01/24

    5,470       5,841,905  

5.00%, 11/01/30

    655       697,961  

Long Island Power Authority, Refunding RB, Electric System, Series A, 5.50%, 04/01/19(a)

    1,000       1,032,630  

Metropolitan Transportation Authority, RB(a):

   

Sub-Series B-1, 5.00%, 11/15/21

    2,300       2,532,760  

Sub-Series B-4, 5.00%, 11/15/21

    1,500       1,651,800  

New York City Trust for Cultural Resources, Refunding RB, Carnegie Hall, Series A, 5.00%, 12/01/29

    2,750       2,884,282  

New York State Dormitory Authority, RB, North Shore-Long Island Jewish Health System, Series A, 5.50%, 05/01/19(a)

    1,495       1,548,073  

New York State Dormitory Authority, Refunding RB:

   

4.25%, 09/01/19(a)

    480       494,870  

5.00%, 07/01/30

    1,555       1,764,801  

New York State Thruway Authority, Refunding RB, Series L, 5.00%, 01/01/32

    250       290,755  

Port Authority of New York & New Jersey, ARB, JFK International Air Terminal LLC Project, Series 8, 5.00%, 12/01/20

    2,475       2,581,549  

Port Authority of New York & New Jersey, Refunding ARB, Consolidated, 152nd Series, AMT, 5.00%, 11/01/23

    1,000       1,000,000  

State of New York Dormitory Authority, RB:

   

Fordham University, Series A, 5.25%, 07/01/21(a)

    900       984,294  

Icahn School of Medicine at Mount Sinai, Series A,
5.00%, 07/01/32

    9,000       9,956,610  

Mental Health Services (AGM), 5.00%, 08/15/18(a)

    10       10,093  

Mental Health Services (AGM), 5.00%, 08/15/18(a)

    30       30,278  

Mental Health Services (AGM), 5.00%, 02/15/22

    325       328,055  

Mental Health Services, 2nd Series (AGM), 5.00%, 08/15/18(a)

    10       10,093  

Municipal Health Facilities Lease, Sub-Series 2-4,
5.00%, 01/15/27

    6,900       6,918,492  

New York University Hospitals Center, Series A, 5.00%, 07/01/20(a)

    1,725       1,833,261  

New York University Hospitals Center, Series A, 5.13%, 07/01/20(a)

    1,670       1,779,201  
Security   Par
(000)
    Value  
New York (continued)  

State of New York Dormitory Authority, Refunding RB:

   

North Shore-Long Island Jewish Obligated Group, Series A, 5.00%, 05/01/32

  $ 3,060     $ 3,437,512  

Orange Regional Medical Center, 5.00%, 12/01/27(b)

    900       998,307  

Orange Regional Medical Center, 5.00%, 12/01/28(b)

    1,800       1,989,270  

Town of Oyster Bay, GOL, New York Public Improvement, 4.00%, 02/15/24

    4,000       4,213,040  
   

 

 

 
      84,685,388  
North Carolina — 0.3%  

North Carolina Medical Care Commission, Refunding RB, WakeMed, Series A, 5.00%, 10/01/31

    1,500       1,643,925  
   

 

 

 
Ohio — 1.2%  

State of Ohio Turnpike Commission, RB, Junior Lien, Infrastructure Projects, Series A-1, 5.25%, 02/15/31

    6,000       6,656,760  
   

 

 

 
Oklahoma — 1.6%  

Norman Regional Hospital Authority, Refunding RB, 5.00%, 09/01/28

    1,575       1,783,278  

Oklahoma City Public Property Authority, Refunding RB:

   

5.00%, 10/01/27

    1,190       1,359,872  

5.00%, 10/01/28

    1,265       1,441,037  

5.00%, 10/01/29

    1,400       1,591,828  

Oklahoma Development Finance Authority, RB, OU Medicine Project, Series B:

   

5.00%, 08/15/29

    1,200       1,350,984  

5.00%, 08/15/33

    1,305       1,444,257  
   

 

 

 
      8,971,256  
Oregon — 1.5%  

County of Klamath Oregon School District, GO:

   

5.00%, 06/15/30

    1,000       1,115,840  

5.00%, 06/15/31

    1,000       1,114,320  

County of Umatilla Oregon School District No. 16R Pendleton, GO, Series A, 5.00%, 06/15/32

    2,000       2,250,600  

Oregon State Facilities Authority, Refunding RB, Reed College Project, Series A, 5.00%, 07/01/20(a)

    1,835       1,953,780  

State of Oregon, GO, Series H, 5.00%, 05/01/36

    2,000       2,185,880  
   

 

 

 
      8,620,420  
Pennsylvania — 8.5%  

Allentown Neighborhood Improvement Zone Development Authority, RB, City Center Project(b):

   

5.00%, 05/01/22

    2,000       2,150,400  

5.00%, 05/01/23(c)

    640       679,744  

5.00%, 05/01/28(c)

    835       911,887  

City of Philadelphia Pennsylvania, GO, Refunding, Series A, 5.00%, 08/01/31

    3,000       3,421,410  

Commonwealth Financing Authority, RB, Tobacco Master Settlement Payment:

   

5.00%, 06/01/31

    1,000       1,128,280  

5.00%, 06/01/32

    2,715       3,048,538  

5.00%, 06/01/33

    2,000       2,236,700  

County of Allegheny Pennsylvania, GO, Refunding, Series C-68, 5.00%, 11/01/25

    2,515       2,734,861  

County of Allegheny Pennsylvania, GO, Series C-67:

   

5.00%, 11/01/25

    2,700       2,936,034  

5.00%, 11/01/26

    2,375       2,580,129  

Montgomery County Higher Education & Health Authority, Refunding RB, Health Hospital Nursing Home Improvement, 5.00%, 09/01/32(c)

    1,310       1,492,431  

Pennsylvania Economic Development Financing Authority, RB, PA Bridges Finco LP, AMT, 5.00%, 12/31/28

    115       127,752  

Pennsylvania Turnpike Commission, RB:

   

Series B, 5.00%, 12/01/32

    1,500       1,682,580  

Sub-Series B, 5.25%, 12/01/21(a)

    4,000       4,419,240  
 

 

 

58    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock Muni Intermediate Duration Fund, Inc. (MUI)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Pennsylvania (continued)  

Pennsylvania Turnpike Commission, Refunding RB:

   

Second Series, 5.00%, 12/01/30

  $ 2,620     $ 2,960,259  

Sub-Series B-2, 5.00%, 06/01/31

    5,000       5,603,800  

School District of Philadelphia, GOL, Series A:

   

5.00%, 09/01/30

    1,200       1,375,032  

5.00%, 09/01/31

    1,000       1,140,230  

5.00%, 09/01/32

    1,200       1,360,428  

South Fork Municipal Authority, Refunding RB, Conemaugh Valley Memorial Hospital, Series A (AGC), 6.00%, 07/01/20(a)

    6,225       6,731,590  
   

 

 

 
      48,721,325  
Rhode Island — 2.2%  

Narragansett Bay Commission, Refunding RB, Series B, 5.00%, 09/01/32

    4,150       4,650,573  

Providence Redevelopment Agency, Refunding RB, Series A, 5.00%, 04/01/29

    1,000       1,084,350  

Rhode Island Health & Educational Building Corp., RB, City of Newport Issue Financing Program, Series C, 5.00%, 05/15/30

    2,305       2,525,842  

Rhode Island Health & Educational Building Corp., Refunding RB, 5.00%, 09/01/32

    2,000       2,226,880  

Rhode Island Student Loan Authority, Refunding RB, Senior Series A, AMT(c):

   

5.00%, 12/01/24

    750       829,133  

5.00%, 12/01/25

    850       945,795  
   

 

 

 
      12,262,573  
South Carolina — 2.5%  

South Carolina Jobs-Economic Development Authority, Refunding RB, The Woodlands at Furman, 4.00%, 11/15/27

    995       996,871  

South Carolina Public Service Authority, Refunding RB, Series A:

   

5.00%, 12/01/30

    5,500       6,096,585  

5.00%, 12/01/31

    5,660       6,261,318  

5.00%, 12/01/32

    200       221,100  

5.00%, 12/01/33

    800       881,440  
   

 

 

 
      14,457,314  
South Dakota — 0.2%  

South Dakota Health & Educational Facilities Authority, Refunding RB, Regional Health, 5.00%, 09/01/20(a)

    1,000       1,065,590  
   

 

 

 
Tennessee — 2.0%  

County of Memphis-Shelby Industrial Development Board, Refunding, Tax Allocation Bonds, Graceland Project, Series A, 4.75%, 07/01/27

    220       231,508  

County of Memphis-Shelby Tennessee Sports Authority, Inc., Refunding RB, Memphis Arena Project:

   

Series A, 5.00%, 11/01/23

    2,695       2,812,044  

Series B, 5.00%, 11/01/22

    1,000       1,043,580  

Knox County Health Educational & Housing Facility Board Tennessee, Refunding RB, Eastowne Village Project, 4.00%, 06/01/31(g)

    3,045       3,110,224  

Metropolitan Government Nashville & Davidson County Health & Educational Facilities Board, RB, Vanderbilt University Medical Center, Series A, 5.00%, 07/01/35

    4,000       4,425,680  
   

 

 

 
      11,623,036  
Texas — 10.6%  

City of Austin Texas Water & Wastewater System Revenue, Refunding RB, 5.00%, 11/15/30

    6,000       7,005,900  

City of Grapevine Texas, GO, 5.00%, 02/15/33

    5,685       6,262,766  

City of Houston Texas, Refunding ARB, Subordinate Lien, Series A, AMT:

   

5.00%, 07/01/25

    1,500       1,609,560  

5.00%, 07/01/32

    1,010       1,086,841  
Security   Par
(000)
    Value  
Texas (continued)  

City of Houston TX Airport System Revenue, Refunding ARB, Sub-Series A, AMT:

   

5.00%, 07/01/29

  $ 1,000     $ 1,161,680  

5.00%, 07/01/30

    1,545       1,787,519  

5.00%, 07/01/31

    1,430       1,646,416  

5.00%, 07/01/32

    1,115       1,277,500  

Dallas-Fort Worth International Airport, ARB, Joint Improvement, Series D, AMT, 5.00%, 11/01/38

    8,290       8,850,818  

Dallas/Fort Worth Texas International Airport, Refunding RB, AMT:

   

Series E, 5.00%, 11/01/26

    2,185       2,315,903  

Series E, 5.00%, 11/01/27

    4,960       5,253,434  

Series F, 5.00%, 11/01/31

    6,345       6,710,916  

Love Field Airport Modernization Corp., RB, Southwest Airlines Co. Project, AMT, 5.00%, 11/01/28

    1,000       1,082,670  

New Hope Cultural Education Facilities Finance Corp., RB, Jubilee Academic Center Project, Series A(b):

   

3.63%, 08/15/22

    105       103,459  

4.25%, 08/15/27

    160       155,915  

Red River Education Financing Corp., RB, 5.00%, 03/15/33

    1,340       1,469,444  

San Jacinto River Authority, RB, Special Project (AGM), 5.25%, 10/01/25

    2,910       3,044,471  

Socorro Independent School District, GO, Refunding(PSF-GTD):

   

5.00%, 08/15/20(a)

    2,410       2,574,049  

5.00%, 08/15/32

    90       95,690  

Via Metropolitan Transit Authority, Refunding RB:

   

5.25%, 08/01/28

    1,585       1,777,324  

5.25%, 08/01/29

    1,720       1,926,022  

5.25%, 08/01/33

    3,000       3,350,010  
   

 

 

 
      60,548,307  
U.S. Virgin Islands — 0.9%  

Virgin Islands Public Finance Authority, Refunding RB, Series A (AGM), 5.25%, 10/01/24

    5,000       5,298,000  
   

 

 

 
Utah — 0.3%  

Utah Charter School Finance Authority, Refunding RB, Freedom Academy Foundation Project, 4.50%, 06/15/27(b)

    1,500       1,496,595  
   

 

 

 
Vermont — 1.0%  

University of Vermont & State Agricultural College, Refunding RB, 4.00%, 10/01/30

    5,565       5,840,968  
   

 

 

 
Washington — 0.3%  

Washington State Housing Finance Commission, Refunding RB, Horizone House Project, 5.00%, 01/01/27(b)

    1,355       1,520,784  
   

 

 

 
West Virginia — 1.0%  

West Virginia Hospital Finance Authority, Refunding RB, Charleston Area Medical Center, Inc., Series A, 5.13%, 09/01/23

    4,000       4,125,800  

West Virginia University, RB, West Virginia University Project, Series B, 5.00%, 10/01/30

    1,500       1,619,910  
   

 

 

 
      5,745,710  
Wisconsin — 1.4%  

Public Finance Authority, Refunding RB, AMT:

   

National Gypsum Co., 5.25%, 04/01/30

    2,410       2,572,338  

Wisconsin Airport Facilities, Senior Obligated Group, Series B, 5.25%, 07/01/28

    4,765       5,142,769  
   

 

 

 
      7,715,107  

Total Municipal Bonds — 138.3%
(Cost — $766,212,482)

 

    790,467,874  
   

 

 

 
 

 

 

SCHEDULES OF INVESTMENTS      59  


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock Muni Intermediate Duration Fund, Inc. (MUI)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  

Municipal Bonds Transferred to Tender Option Bond Trusts(h)

 

California — 4.0%  

Bay Area Toll Authority, Refunding RB, San Francisco Bay Area Subordinate, 4.00%, 04/01/31(i)

  $ 8,080     $ 8,687,333  

State of California, GO, Refunding Water Utility Authority, 5.00%, 10/01/35

    12,500       14,285,409  
   

 

 

 
      22,972,742  
Connecticut — 2.0%  

Connecticut State Health & Educational Facility Authority, Refunding RB, Trinity Health Group, 5.00%, 12/01/33

    10,000       11,363,968  
   

 

 

 
Massachusetts — 3.4%  

Massachusetts Development Finance Agency, Refunding RB, Partners Healthcare System:

   

5.00%, 07/01/32

    7,500       8,668,250  

Series L, 5.00%, 07/01/31

    10,175       10,988,224  
   

 

 

 
      19,656,474  
Minnesota — 1.9%  

State of Minnesota, GO, State Various Purposes, Series A, 4.00%, 08/01/20(a)

    10,525       10,982,685  
   

 

 

 
New York — 12.4%  

City of New York, GO:

   

Sub-Series 1-I, 5.00%, 03/01/32

    7,009       7,822,451  

Refunding Series E, 5.00%, 08/01/19(a)

    1,017       1,056,459  

Refunding Series E, 5.00%, 08/01/27

    2,489       2,584,746  

Metropolitan Transportation Authority, RB, Sub-Series D-1, 5.00%, 11/15/39

    4,980       5,511,034  

Metropolitan Transportation Authority, Refunding RB, Series B, 5.25%, 11/15/19(a)

    4,001       4,208,954  

New York City Transitional Finance Authority, RB, Future Tax Secured Subordinate Bonds, SubSeries B-1, 5.00%, 08/01/36

    9,444       10,695,657  

Pflugerville Independent School District, GO, (PSF-GTD), 5.00%, 02/15/24(a)

    7,500       8,577,150  

Port Authority of New York & New Jersey, Refunding ARB:

   

178th Series, AMT, 5.00%, 12/01/32

    4,009       4,408,094  

Consolidated, Series 169th, 5.00%, 10/15/26

    5,530       5,962,169  

Sales Tax Asset Receivable Corp., Refunding RB, Fiscal 2015, Series A, 5.00%, 10/15/31

    5,010       5,694,216  
Security   Par
(000)
    Value  
New York (continued)  

State of New York Dormitory Authority, Refunding RB, Series E, 5.25%, 03/15/33

  $ 7,000     $ 8,104,320  

State of New York Urban Development Corp., RB, Personal Income Tax, Series A-1, 5.00%, 03/15/32

    5,501       6,094,325  
   

 

 

 
      70,719,575  
   

 

 

 

Total Municipal Bonds Transferred to Tender Option
Bond Trusts — 23.7%
(Cost — $133,244,182)

 

    135,695,444  
   

 

 

 

Total Long-Term Investments — 162.0%
(Cost — $899,456,664)

 

    926,163,318  
   

 

 

 

Other Assets Less Liabilities — 2.1%

 

    12,056,633  

Liability for TOB Trust Certificates, Including Interest Expense and Fees Payable — (13.9)%

 

    (79,351,261

VMTP Shares at Liquidation Value — (50.2)%

 

    (287,100,000
   

 

 

 

Net Assets Applicable to Common Shares — 100.0%

 

  $ 571,768,690  
   

 

 

 

 

(a)  U.S. Government securities, held in escrow, are used to pay interest on this security, as well as to retire the bond in full at the date indicated, typically at a premium to par.
(b)  Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors.
(c)  When-issued security.
(d)  Non-income producing security.
(e)  Issuer filed for bankruptcy and/or is in default.
(f)  Security is collateralized by municipal bonds or U.S. Treasury obligations.
(g)  Variable or floating rate security, which interest rate adjusts periodically based on changes in current interest rates and prepayments on the underlying pool of assets. Rate shown is the rate in effect as of period end.
(h)  Represent bonds transferred to a TOB Trust in exchange of cash and residual certificates received by the Fund. These bonds serve as collateral in a secured borrowing. See Note 4 of the Notes to Financial Statements for details.
(i)  All or a portion of security is subject to a recourse agreement. The aggregate maximum potential amount the Fund could ultimately be required to pay under the agreement, which expires on April 1, 2025, is $6,226,089. See Note 4 of the Notes to Financial Statements for details.
 
Affiliated    Shares
Held at
04/30/17
     Net
Activity
     Shares
Held at
04/30/18
     Value at
04/30/18
     Income      Net
Realized
Gain (Loss)
 (a)
     Change in
Unrealized

Appreciation
(Depreciation)
 

BlackRock Liquidity Funds, MuniCash, Institutional Class

     4,693,275        (4,693,275           $      $ 69,558      $ 886      $ (180
           

 

 

    

 

 

    

 

 

    

 

 

 

 

  (a)  Includes net capital gain distributions, if applicable.  

Derivative Financial Instruments Outstanding as of Period End

Futures Contracts

 

Description    Number of
Contracts
       Expiration
Date
       Notional
Amount (000)
       Value/
Unrealized

Appreciation
(Depreciation)
 

Short Contracts:

                 

Long U.S. Treasury Bond

     48          06/20/18        $ 6,905        $ 24,214  

10-Year U.S. Treasury Note

     198          06/20/18          23,686          136,131  

5-Year U.S. Treasury Note

     54          06/29/18          6,129          28,135  
                 

 

 

 
                  $ 188,480  
                 

 

 

 

 

 

60    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock Muni Intermediate Duration Fund, Inc. (MUI)

 

Derivative Financial Instruments Categorized by Risk Exposure

As of year end, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:

 

      Commodity
Contracts
       Credit
Contracts
       Equity
Contracts
       Foreign
Currency
Exchange
Contracts
       Interest
Rate
Contracts
       Other
Contracts
       Total  

Assets — Derivative Financial Instruments

                                

Futures contracts

                                

Net unrealized appreciation(a)

   $        $        $        $        $ 188,480        $        $ 188,480  
  

 

 

      

 

 

      

 

 

      

 

 

      

 

 

      

 

 

      

 

 

 

 

  (a) Includes cumulative appreciation (depreciation) on futures contracts, if any, as reported in the Schedule of Investments. Only current day’s variation margin is reported within the Statements of Assets and Liabilities.  

For the year ended April 30, 2018, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

              Credit
Contracts
     Equity
Contracts
     Foreign
Currency
Exchange
Contracts
     Interest
Rate
Contracts
     Other
Contracts
     Total  

Net Realized Gain (Loss) from:

                    

Futures contracts

   $      $      $      $      $ 2,154,823      $      $ 2,154,823  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
Net Change in Unrealized Appreciation (Depreciation) on:                                                 

Futures contracts

   $      $      $      $      $ 827,962      $      $ 827,962  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

Futures contracts:

 

Average notional value of contracts — long

   $ (a) 

Average notional value of contracts — short

     53,612,037  

 

  (a) Derivative not held at quarter-end. The amount shown in the Statements of Operations reflects the results of activity during the period.  

For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.

Fair Value Hierarchy as of Period End

Various inputs are used in determining the fair value of investments and derivative financial instruments. For information about the Fund’s policy regarding valuation of investments and derivative financial instruments, refer to the Notes to Financial Statements.

The following tables summarize the Fund’s investments and derivative financial instruments categorized in the disclosure hierarchy:

 

      Level 1        Level 2        Level 3        Total  

Assets:

 

Investments:

 

Long-Term Investments(a)

   $        $ 926,163,318        $        $ 926,163,318  
  

 

 

      

 

 

      

 

 

      

 

 

 

Derivative Financial Instruments(b)

 

Assets:

 

Interest rate contracts

   $ 188,480        $        $             —        $ 188,480  
  

 

 

      

 

 

      

 

 

      

 

 

 

 

  (a) See above Schedule of Investments for values in each state or political subdivision.  
  (b) Derivative financial instruments are futures contracts which are valued at the unrealized appreciation (depreciation) on the instrument.  

The Fund may hold assets and/or liabilities in which the fair value approximates the carrying amount for financial statement purposes. As of year end, such assets and/or liabilities are categorized within the disclosure hierarchy as follows:

 

      Level 1        Level 2        Level 3        Total  

Liabilities:

 

TOB Trust Certificates

   $             —        $ (79,135,643      $             —        $ (79,135,643

VMTP Shares at Liquidation Value

              (287,100,000                 (287,100,000
  

 

 

      

 

 

      

 

 

      

 

 

 
   $        $ (366,235,643      $        $ (366,235,643
  

 

 

      

 

 

      

 

 

      

 

 

 

During the year ended April 30, 2018, there were no transfers between levels.

See notes to financial statements.

 

 

SCHEDULES OF INVESTMENTS      61  


Schedule of Investments

April 30, 2018

  

BlackRock MuniVest Fund II, Inc. (MVT)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  

Municipal Bonds — 129.1%

 

Alabama — 1.6%  

County of Jefferson Alabama Sewer, Refunding RB:

   

Senior Lien, Series A (AGM), 5.00%, 10/01/44

  $ 805     $ 876,565  

Sub-Lien, Series D, 6.00%, 10/01/42

    3,575       4,109,927  
   

 

 

 
      4,986,492  
Alaska — 0.2%  

Northern Tobacco Securitization Corp., Refunding RB, Tobacco Settlement, Asset-Backed, Series A, 4.63%, 06/01/23

    620       637,713  
   

 

 

 
Arizona — 0.5%  

City of Phoenix Arizona IDA, RB, Legacy Traditional Schools Projects, Series A, 5.00%, 07/01/46(a)

    1,685       1,718,835  
   

 

 

 
California — 14.7%  

California Health Facilities Financing Authority, RB:

   

St. Joseph Health System, Series A, 5.75%, 07/01/39

    2,200       2,297,504  

Sutter Health, Series B, 6.00%, 08/15/20(b)

    3,170       3,461,545  

California Health Facilities Financing Authority, Refunding RB, St. Joseph Health System, Series A, 5.00%, 07/01/33

    890       995,759  

California Municipal Finance Authority, RB, Senior, Caritas Affordable Housing, Inc. Projects, S/F Housing, Series A:

   

5.25%, 08/15/39

    145       158,173  

5.25%, 08/15/49

    370       401,017  

California Municipal Finance Authority, Refunding RB, Community Medical Centers, Series A, 5.00%, 02/01/42

    225       244,746  

California Pollution Control Financing Authority, RB, Poseidon Resources (Channel Side) LP Desalination Project, AMT, 5.00%, 11/21/45(a)

    4,425       4,690,456  

California Statewide Communities Development Authority, RB, Loma Linda University Medical Center, Series A(a):

   

5.00%, 12/01/41

    290       306,359  

5.00%, 12/01/46

    455       479,069  

City of Los Angeles California Department of Airports, Refunding ARB, Los Angeles International Airport, Series A:

   

Senior, 5.00%, 05/15/40

    5,930       6,295,406  

5.25%, 05/15/39

    800       827,528  

City of Stockton California Public Financing Authority, RB, Delta Water Supply Project, Series A, 6.25%, 10/01/40

    360       419,422  

Golden State Tobacco Securitization Corp., Refunding RB, Asset-Backed, Senior Series A-1:

   

5.13%, 06/01/47

    2,165       2,164,935  

5.75%, 06/01/47

    1,630       1,676,814  

San Marcos Unified School District, GO, CAB, Election of 2010, Series B, 0.00%, 08/01/42(c)

    2,000       752,920  

State of California, GO, Various Purposes:

   

6.50%, 04/01/19(b)

    8,085       8,426,268  

6.00%, 03/01/33

    2,525       2,717,910  

6.50%, 04/01/33

    6,840       7,129,332  

State of California Public Works Board, LRB, Various Capital Projects:

   

Series I, 5.00%, 11/01/38

    775       861,730  

Sub-Series I-1, 6.38%, 11/01/19(b)

    1,185       1,265,829  

Tobacco Securitization Authority of Southern California, Refunding RB, Tobacco Settlement, Asset-Backed, Senior Series A-1, 4.75%, 06/01/25

    595       596,273  
   

 

 

 
      46,168,995  
Colorado — 0.3%  

Colorado Health Facilities Authority, RB, Catholic Health Initiatives, Series D, 6.25%, 10/01/33

    1,060       1,080,765  
   

 

 

 
Connecticut — 1.6%  

Connecticut State Health & Educational Facility Authority, RB, Ascension Health Senior Credit, Series A, 5.00%, 11/15/40

    1,375       1,432,406  

Connecticut State Health & Educational Facility Authority, Refunding RB, Wesleyan University, Series G, 5.00%, 07/01/20(b)

    3,385       3,604,111  
   

 

 

 
      5,036,517  
Security   Par
(000)
    Value  
Delaware — 2.1%  

County of Sussex Delaware, RB, NRG Energy, Inc., Indian River Power LLC Project, 6.00%, 10/01/40

  $ 1,125     $ 1,187,224  

Delaware Transportation Authority, RB, U.S. 301 Project, 5.00%, 06/01/55

    1,165       1,269,908  

State of Delaware EDA, RB, Exempt Facilities, Indian River Power LLC Project, 5.38%, 10/01/45

    4,065       4,215,446  
   

 

 

 
      6,672,578  
District of Columbia — 3.9%  

District of Columbia, Refunding RB:

   

Georgetown University, 5.00%, 04/01/35

    435       493,851  

Georgetown University Issue, 5.00%, 04/01/42

    500       559,430  

Kipp Charter School, Series A, 6.00%, 07/01/23(b)

    240       282,101  

Metropolitan Washington Airports Authority, Refunding ARB, Dulles Toll Road, CAB, 2nd Senior Lien, Series B (AGC), 0.00%, 10/01/35(c)

    6,515       3,191,633  

Metropolitan Washington Airports Authority, Refunding RB, Dulles Toll Road:

   

1st Senior Lien, Series A, 5.25%, 10/01/44

    1,500       1,557,345  

CAB, 2nd Senior Lien, Series B (AGC), 0.00%, 10/01/33(c)

    6,590       3,584,433  

CAB, 2nd Senior Lien, Series B (AGC), 0.00%, 10/01/34(c)

    4,830       2,485,035  
   

 

 

 
      12,153,828  
Florida — 3.4%  

Celebration Pointe Community Development District, Special Assessment Bonds, County of Alachua Florida(a):

   

5.00%, 05/01/32

    470       486,173  

5.00%, 05/01/48

    1,175       1,199,757  

Country of Broward Florida Airport System, ARB, AMT, 5.00%, 10/01/47

    290       322,657  

County of Collier Florida Health Facilities Authority, Refunding RB, Series A, 5.00%, 05/01/45

    1,340       1,466,402  

County of Miami-Dade Florida Aviation, Refunding ARB, Miami International Airport, Series A-1, 5.38%, 10/01/41

    1,165       1,248,624  

Mid-Bay Florida Bridge Authority, RB, Springing Lien, Series A, 7.25%, 10/01/21(b)

    3,015       3,500,083  

Village Community Development District No.10, Special Assessment Bonds, 5.13%, 05/01/43

    2,230       2,459,400  
   

 

 

 
      10,683,096  
Georgia — 1.9%  

City of Atlanta Georgia Water & Wastewater Revenue, Refunding RB, 5.00%, 11/01/40

    600       673,224  

County of Dalton Whitfield Joint Development Authority, RB, Hamilton Health Care System Obligation, 4.00%, 08/15/48

    1,825       1,824,909  

County of Gainesville Georgia & Hall Hospital Authority, Refunding RB, Northeast Georgia Health System, Inc. Project, Series A, 5.50%, 08/15/54

    515       588,063  

DeKalb Georgia Private Hospital Authority, Refunding RB, Children’s Healthcare, 5.25%, 11/15/39

    130       136,218  

Glynn-Brunswick Memorial Hospital Authority, RB, Southeast Georgia Health System Project, 5.00%, 08/01/47

    2,500       2,709,600  
   

 

 

 
      5,932,014  
Hawaii — 0.5%  

State of Hawaii Harbor System, RB, Series A, 5.25%, 07/01/30

    1,355       1,440,338  
   

 

 

 
Idaho — 0.3%  

Idaho Health Facilities Authority, RB, Trinity Health Credit Group, Series A, 5.00%, 12/01/46

    745       833,730  
   

 

 

 
Illinois — 20.8%  

Chicago Board of Education, GO, Dedicated Revenues, Series H, 5.00%, 12/01/36

    450       447,826  

Chicago Board of Education, GO, Refunding, Dedicated Revenues, Series G, 5.00%, 12/01/34

    450       450,999  
 

 

 

62    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniVest Fund II, Inc. (MVT)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Illinois (continued)  

Chicago Board of Education, GO, Refunding Dedicated Revenues:

   

Series C, 5.00%, 12/01/25

  $ 815     $ 859,638  

Series F, 5.00%, 12/01/24

    615       649,163  

City of Chicago Illinois, GO, Project, Series A, 5.00%, 01/01/34

    1,750       1,771,490  

City of Chicago Illinois, GO, Refunding, Project, Series A, 5.25%, 01/01/32

    4,555       4,714,653  

City of Chicago Illinois, Special Assessment Bonds, Lake Shore East Project, 6.75%, 12/01/32

    782       786,285  

City of Chicago Illinois O’Hare International Airport, GARB, 3rd Lien, Series C, 6.50%, 01/01/21(b)

    5,865       6,518,654  

City of Chicago Illinois Transit Authority, RB, Sales Tax Receipts, 5.25%, 12/01/40

    1,050       1,119,678  

City of Chicago Illinois Waterworks, Refunding RB:

   

2nd Lien (AGM), 5.25%, 11/01/18(b)

    875       890,006  

2nd Lien (AGM), 5.25%, 11/01/33

    260       263,549  

2nd Lien Project, 5.00%, 11/01/42

    915       962,315  

County of Cook Illinois Community College District No. 508, GO, City College of Chicago, 5.50%, 12/01/38

    805       845,524  

Illinois Finance Authority, RB:

   

Advocate Health Care Network, Series D, 6.50%, 11/01/18(b)

    5,000       5,114,050  

Chicago LLC, University of Illinois at Chicago Project, Series A, 5.00%, 02/15/47

    200       211,396  

Chicago LLC, University of Illinois at Chicago Project, Series A, 5.00%, 02/15/50

    100       105,306  

Illinois Finance Authority, Refunding RB:

   

Central Dupage Health, Series B, 5.50%, 11/01/19(b)

    1,610       1,693,688  

Presence Health Network, Series C, 4.00%, 02/15/41

    3,230       3,196,473  

Metropolitan Pier & Exposition Authority, Refunding RB, McCormick Place Expansion Project:

   

Series B (AGM), 5.00%, 06/15/50

    4,315       4,494,418  

Series B-2, 5.00%, 06/15/50

    2,500       2,533,450  

Railsplitter Tobacco Settlement Authority, RB(b):

   

5.50%, 06/01/21

    440       483,978  

6.00%, 06/01/21

    1,140       1,270,849  

Regional Transportation Authority, RB:

   

Series A (AMBAC), 7.20%, 11/01/20

    510       548,505  

Series A (NPFGC), 6.70%, 11/01/21

    3,325       3,620,792  

Series C (NPFGC), 7.75%, 06/01/20

    970       1,030,460  

State of Illinois, GO:

   

5.00%, 02/01/39

    1,540       1,545,991  

Series A, 5.00%, 04/01/35

    3,000       3,024,570  

Series A, 5.00%, 04/01/38

    3,490       3,504,937  

State of Illinois, RB, Build Illinois, Series B, 5.25%, 06/15/19(b)

    630       653,537  

State of Illinois Toll Highway Authority, RB:

   

Senior, Series C, 5.00%, 01/01/36

    2,615       2,878,880  

Senior, Series C, 5.00%, 01/01/37

    2,800       3,071,992  

Series A, 5.00%, 01/01/38

    1,980       2,157,388  

University of Illinois, RB, Auxiliary Facilities System, Series A, 5.00%, 04/01/44

    985       1,056,215  

Village of Hodgkins Illinois, RB, Metropolitan Biosolids Management LLC Project, AMT, 6.00%, 11/01/23

    2,800       2,803,080  
   

 

 

 
      65,279,735  
Indiana — 4.6%  

City of Valparaiso Indiana, RB, Exempt Facilities, Pratt Paper LLC Project, AMT:

   

6.75%, 01/01/34

    790       922,159  

7.00%, 01/01/44

    1,905       2,235,136  

Indiana Finance Authority, RB, Series A:

   

CWA Authority Project, 1st Lien, 5.25%, 10/01/38

    3,280       3,576,709  

Private Activity Bond, Ohio River Bridges East End Crossing Project, AMT, 5.00%, 07/01/44

    450       479,205  
Security   Par
(000)
    Value  
Indiana (continued)  

Private Activity Bond, Ohio River Bridges East End Crossing Project, AMT, 5.00%, 07/01/48

  $ 1,430     $ 1,518,660  

Private Activity Bond, Ohio River Bridges East End Crossing Project, AMT, 5.25%, 01/01/51

    405       434,241  

Sisters of St. Francis Health Services, 5.25%, 11/01/19(b)

    840       880,580  

Indiana Finance Authority, Refunding RB, Parkview Health System, Series A:

   

5.75%, 05/01/19(b)

    2,290       2,374,364  

5.75%, 05/01/31

    505       524,321  

Indianapolis Local Public Improvement Bond Bank, RB, Series A, 5.00%, 01/15/40

    1,270       1,395,197  
   

 

 

 
      14,340,572  
Iowa — 1.5%  

Iowa Finance Authority, Refunding RB, Iowa Fertilizer Co. Project:

   

Series B, 5.25%, 12/01/50(d)

    2,810       2,951,371  

Midwestern Disaster Area, 5.50%, 12/01/22

    10       10,145  

Midwestern Disaster Area, 5.25%, 12/01/25

    460       489,435  

Midwestern Disaster Area, 5.88%, 12/01/26(a)

    410       432,243  

Iowa Student Loan Liquidity Corp., Refunding RB, Student Loan, Senior Series A-1, AMT, 5.15%, 12/01/22

    855       881,924  
   

 

 

 
      4,765,118  
Kentucky — 1.1%  

Kentucky Economic Development Finance Authority, RB, Catholic Health Initiatives, Series A, 5.25%, 01/01/45

    995       1,056,949  

Kentucky Economic Development Finance Authority, Refunding RB, Louisville Arena Authority, Inc. (AGM), 5.00%, 12/01/45

    1,235       1,345,792  

Kentucky Public Transportation Infrastructure Authority, RB, Downtown Crossing Project, Convertible CAB, 1st Tier, Series C, 0.00%, 07/01/43(e)

    1,200       1,108,980  
   

 

 

 
      3,511,721  
Louisiana — 3.4%  

Louisiana Local Government Environmental Facilities & Community Development Authority, RB, Westlake Chemical Corp. Project, Series A-1, 6.50%, 11/01/35

    3,320       3,654,822  

Louisiana Public Facilities Authority, Refunding RB, Tulane University of Louisiana Project, 4.00%, 12/15/50

    2,000       2,027,080  

Tobacco Settlement Financing Corp., Refunding RB, Asset-Backed, Series A:

   

5.50%, 05/15/30

    1,020       1,087,289  

5.25%, 05/15/31

    870       935,033  

5.25%, 05/15/32

    1,110       1,205,582  

5.25%, 05/15/33

    1,205       1,298,773  

5.25%, 05/15/35

    505       546,203  
   

 

 

 
      10,754,782  
Maryland — 0.8%  

Maryland EDC, RB, Transportation Facilities Project, Series A, 5.75%, 06/01/20(b)

    435       467,795  

Maryland EDC, Refunding RB, CNX Marine Terminals, Inc., 5.75%, 09/01/25

    750       782,452  

Maryland Health & Higher Educational Facilities Authority, RB:

   

Trinity Health Credit Group, Series 2017, 5.00%, 12/01/46

    420       472,811  

University of Maryland Medical System, Series B (NPFGC), 7.00%, 07/01/22(f)

    660       746,341  
   

 

 

 
      2,469,399  
Massachusetts — 1.8%  

Massachusetts Development Finance Agency, Refunding RB(a):

   

Covanta Energy Project, Series C, AMT, 5.25%, 11/01/42

    2,205       2,206,323  

New Bridge Charles, Inc., 4.00%, 10/01/32

    215       211,063  

New Bridge Charles, Inc., 4.13%, 10/01/42

    135       130,455  

New Bridge Charles, Inc., 5.00%, 10/01/57

    340       355,307  
 

 

 

SCHEDULES OF INVESTMENTS      63  


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniVest Fund II, Inc. (MVT)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Massachusetts (continued)  

Massachusetts Health & Educational Facilities Authority, Refunding RB, Partners Healthcare System, Series J1, 5.00%, 07/01/19(b)

  $ 990     $ 1,024,907  

Massachusetts HFA, Refunding RB, Series F, AMT, 5.70%, 06/01/40

    1,680       1,697,909  
   

 

 

 
      5,625,964  
Michigan — 5.1%  

City of Detroit Michigan Sewage Disposal System, Refunding RB, Senior Lien, Series A, 5.25%, 07/01/39

    4,425       4,731,254  

Kalamazoo Hospital Finance Authority, Refunding RB, Bronson Methodist Hospital:

   

5.50%, 05/15/20(b)

    760       811,551  

5.50%, 05/15/36

    620       653,275  

Michigan Finance Authority, Refunding RB:

   

Detroit Water & Sewage Department Project, Senior Lien, Series C-1, 5.00%, 07/01/44

    880       951,597  

Henry Ford Health System, 4.00%, 11/15/46

    1,215       1,206,799  

Michigan State Hospital Finance Authority, Refunding RB, McLaren Health Care, Series A, 5.75%, 05/15/18(b)

    7,560       7,570,887  
   

 

 

 
      15,925,363  
Mississippi — 1.4%  

County of Lowndes Mississippi, Refunding RB, Solid Waste Disposal & Pollution Control, Weyerhaeuser Co. Project, Series A, 6.80%, 04/01/22

    3,000       3,416,730  

University of Southern Mississippi, RB, Campus Facilities Improvements Project, 5.38%, 09/01/19(b)

    1,065       1,114,235  
   

 

 

 
      4,530,965  
Missouri — 1.1%  

Bi-State Development Agency of the Missouri-Illinois Metropolitan District, Refunding RB, Combined Lien, Series A, 5.00%, 10/01/44

    255       280,026  

State of Missouri Health & Educational Facilities Authority, Refunding RB:

   

Mercy Health, Series C, 5.00%, 11/15/47

    2,570       2,849,462  

St. Louis College of Pharmacy Project, 5.50%, 05/01/43

    245       262,757  
   

 

 

 
      3,392,245  
Nebraska — 0.8%  

Central Plains Nebraska Energy Project, RB, Gas Project No. 3:

   

5.25%, 09/01/37

    825       906,510  

5.00%, 09/01/42

    1,445       1,573,128  
   

 

 

 
      2,479,638  
New Jersey — 7.2%  

Casino Reinvestment Development Authority, Refunding RB:

   

5.25%, 11/01/39

    1,675       1,774,713  

5.25%, 11/01/44

    1,525       1,616,119  

County of Essex New Jersey Improvement Authority, RB, AMT, 5.25%, 07/01/45(a)

    1,085       1,095,069  

New Jersey EDA, RB, Continental Airlines, Inc. Project, AMT, 5.25%, 09/15/29

    1,955       2,121,097  

New Jersey EDA, Refunding ARB, Port Network Container Terminal LLC Project, AMT, 5.00%, 10/01/47

    1,425       1,519,691  

New Jersey EDA, Refunding, Special Assessment Bonds, Kapkowski Road Landfill Project, 5.75%, 04/01/31

    2,240       2,480,553  

New Jersey State Turnpike Authority, RB:

   

Series A, 5.00%, 07/01/22(b)

    1,245       1,383,469  

Series A, 5.00%, 01/01/43

    740       801,723  

Series E, 5.00%, 01/01/45

    2,615       2,867,400  

New Jersey Transportation Trust Fund Authority, RB:

   

Transportation Program, Series AA, 5.00%, 06/15/44

    445       463,770  

Transportation Program, Series AA, 5.00%, 06/15/44

    825       859,708  

Transportation System, Series A, 5.50%, 06/15/41

    1,635       1,705,681  

Transportation System, Series B, 5.25%, 06/15/36

    2,460       2,558,006  
Security   Par
(000)
    Value  
New Jersey (continued)  

Tobacco Settlement Financing Corp., Refunding RB:

   

Series A, 5.25%, 06/01/46

  $ 525     $ 583,081  

Sub-Series B, 5.00%, 06/01/46

    745       781,669  
   

 

 

 
      22,611,749  
New York — 15.3%  

City of New York New York Transitional Finance Authority, RB, Fiscal 2009, Series S-3, 5.25%, 01/15/39

    6,700       6,852,894  

City of New York New York Transitional Finance Authority Future Tax Secured, RB, Fiscal 2012, Sub-Series E-1, 5.00%, 02/01/42

    1,960       2,116,643  

Counties of New York Tobacco Trust IV, Refunding RB, Settlement Pass-Through Turbo, Series A, 6.25%, 06/01/41(a)

    1,800       1,874,520  

Erie Tobacco Asset Securitization Corp., Refunding RB, Asset-Backed, Series A, 5.00%, 06/01/45

    1,960       1,917,233  

Hudson Yards Infrastructure Corp., Refunding RB, Series A, 5.00%, 02/15/39

    920       1,041,403  

Metropolitan Transportation Authority, RB, Series C:

   

6.50%, 11/15/18(b)

    7,015       7,191,567  

6.50%, 11/15/18(b)

    580       594,599  

6.50%, 11/15/28

    1,810       1,856,245  

Metropolitan Transportation Authority Hudson Rail Yards Trust Obligations, Refunding RB, Series A, 5.00%, 11/15/56

    1,045       1,123,250  

New York Counties Tobacco Trust IV, Refunding RB, Tobacco Settlement Pass-Through Bonds, Series A, 5.00%, 06/01/38

    1,910       1,897,948  

New York Liberty Development Corp., RB, World Trade Center Port Authority Consolidated, 5.25%, 12/15/43

    10,735       11,711,348  

New York Liberty Development Corp., Refunding RB:

   

2nd Priority, Bank of America Tower at One Bryant Park Project, Class 3, 6.38%, 07/15/49

    1,220       1,290,504  

3 World Trade Center Project, Class 1, 5.00%, 11/15/44(a)

    2,860       3,004,544  

3 World Trade Center Project, Class 2, 5.15%, 11/15/34(a)

    340       369,937  

3 World Trade Center Project, Class 2, 5.38%, 11/15/40(a)

    850       925,803  

Port Authority of New York & New Jersey, ARB, Special Project, JFK International Air Terminal LLC Project, Series 8:

   

6.00%, 12/01/36

    1,165       1,275,757  

6.00%, 12/01/42

    1,250       1,366,850  

Port Authority of New York & New Jersey, Refunding RB, Consolidated, 205th Series, 5.00%, 11/15/47

    1,565       1,779,765  
   

 

 

 
      48,190,810  
North Carolina — 0.2%  

North Carolina Medical Care Commission, Refunding RB, 1st Mortgage, Retirement Facilities Whitestone Project, Series A, 7.75%, 03/01/21(b)

    595       683,875  
   

 

 

 
Ohio — 1.5%  

Buckeye Tobacco Settlement Financing Authority, RB, Asset-Backed, Senior Turbo Term, Series A-2, 5.88%, 06/01/47

    3,230       3,229,968  

County of Franklin Ohio, RB:

   

Health Care Facilities Improvement, OPRS Communities Obligation Group, Series A, 6.13%, 07/01/40

    660       719,340  

Trinity Health Credit Group, Series 2017, 5.00%, 12/01/46

    400       447,640  

State of Ohio, RB, Portsmouth Bypass Project, AMT, 5.00%, 06/30/53

    275       299,643  
   

 

 

 
      4,696,591  
Oklahoma — 1.0%  

Oklahoma Development Finance Authority, RB, OU Medicine Project, Series B, 5.50%, 08/15/57

    1,155       1,281,334  

Oklahoma Turnpike Authority, RB, 2nd Series C, 4.00%, 01/01/42

    1,950       1,994,401  
   

 

 

 
      3,275,735  
 

 

 

64    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniVest Fund II, Inc. (MVT)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Pennsylvania — 2.7%  

City of Philadelphia Pennsylvania Airport Revenue, Refunding ARB, AMT, Series B, 5.00%, 07/01/47

  $ 445     $ 490,684  

City of Philadelphia Pennsylvania Hospitals & Higher Education Facilities Authority, RB, Temple University Health System, Series A, 5.63%, 07/01/42

    635       686,321  

Commonwealth Financing Authority, RB, Tobacco Master Settlement Payment:

   

5.00%, 06/01/33

    100       111,835  

5.00%, 06/01/34

    135       150,011  

County of Montgomery Higher Education & Health Authority, Refunding RB, Thomas Jefferson University, Series A(g):

   

4.00%, 09/01/49

    555       546,198  

5.00%, 09/01/43

    1,220       1,355,054  

Pennsylvania Economic Development Financing Authority, RB:

   

AMT, 5.00%, 06/30/42

    850       909,865  

Aqua Pennsylvania, Inc. Project, Series B, 5.00%, 11/15/40

    1,890       1,965,411  

Pennsylvania Economic Development Financing Authority, Refunding RB, National Gypsum Co., AMT, 5.50%, 11/01/44

    1,035       1,087,992  

Pennsylvania Turnpike Commission, RB, Series A, 5.00%, 12/01/44

    1,105       1,202,317  
   

 

 

 
      8,505,688  
Puerto Rico — 1.1%  

Children’s Trust Fund, Refunding RB, Tobacco Settlement Asset-Backed Bonds:

   

5.50%, 05/15/39

    1,855       1,809,812  

5.63%, 05/15/43

    1,770       1,692,669  
   

 

 

 
      3,502,481  
Rhode Island — 2.1%  

Tobacco Settlement Financing Corp., Refunding RB:

   

Series A, 5.00%, 06/01/35

    820       881,615  

Series B, 4.50%, 06/01/45

    2,645       2,672,085  

Series B, 5.00%, 06/01/50

    2,945       3,017,182  
   

 

 

 
      6,570,882  
South Carolina — 4.8%  

State of South Carolina Ports Authority, ARB:

   

5.25%, 07/01/40

    3,280       3,475,849  

AMT, 5.25%, 07/01/55

    1,295       1,430,535  

State of South Carolina Public Service Authority, RB, Santee Cooper, Series A, 5.50%, 12/01/54

    6,180       6,745,408  

State of South Carolina Public Service Authority, Refunding RB, Series E, 5.25%, 12/01/55

    3,135       3,410,347  
   

 

 

 
      15,062,139  
Tennessee — 0.6%  

City of Chattanooga Health Educational & Housing Facility Board, RB, Catholic Health Initiatives, Series A, 5.25%, 01/01/45

    995       1,056,949  

County of Nashville & Davidson Metropolitan Government Health & Educational Facilities Board, RB, Vanderbilt University Medical Center, Series A, 5.00%, 07/01/40

    690       758,282  
   

 

 

 
      1,815,231  
Texas — 9.5%  

Central Texas Regional Mobility Authority, Refunding RB, Senior Lien, 6.25%, 01/01/21(b)

    2,140       2,361,811  

City of Dallas Texas Waterworks & Sewer System Revenue, Refunding RB:

   

5.00%, 10/01/20(b)

    235       250,954  

5.00%, 10/01/35

    275       292,801  

City of Houston Texas Airport System, Refunding ARB, United Airlines, Inc. Terminal E Project, AMT, 5.00%, 07/01/29

    965       1,043,918  
Security   Par
(000)
    Value  
Texas (continued)  

Clifton Higher Education Finance Corp., RB, Idea Public Schools, 6.00%, 08/15/43

  $ 745     $ 845,083  

County of Harris Texas Cultural Education Facilities Finance Corp., RB, 1st Mortgage, Brazos Presbyterian Homes, Inc. Project, Series B, 7.00%, 01/01/23(b)

    455       546,587  

County of Harris Texas Health Facilities Development Corp., Refunding RB, Memorial Hermann Healthcare System, Series B, 7.25%, 12/01/18(b)

    2,000       2,062,740  

County of Tarrant Texas Cultural Education Facilities Finance Corp., Refunding RB, Trinity Terrace Project, 5.00%, 10/01/49

    1,000       1,049,700  

Dallas-Fort Worth Texas International Airport, Refunding ARB, AMT, Series E, 5.00%, 11/01/32

    4,135       4,368,297  

Fort Bend County Industrial Development Corp., RB, NRG Energy Inc. Project, Series B, 4.75%, 11/01/42

    670       683,306  

North Texas Tollway Authority, Refunding RB, Series A:

   

1st Tier System, 6.25%, 01/01/19(b)

    5,690       5,854,669  

1st Tier System, 6.25%, 01/01/39

    1,310       1,345,252  

5.00%, 01/01/38

    925       1,010,812  

San Antonio Water System, Refunding RB, Junior Lien, Series A, 5.00%, 05/15/48(g)

    2,470       2,808,143  

Texas Private Activity Bond Surface Transportation Corp., RB, Senior Lien:

   

LBJ Infrastructure Group LLC, 7.00%, 06/30/40

    2,000       2,194,760  

NTE Mobility Partners LLC, North Tarrant Express Managed Lanes Project, 6.88%, 12/31/39

    2,775       2,983,347  
   

 

 

 
      29,702,180  
Utah — 1.2%  

City of Riverton Utah, RB, IHC Health Services, Inc., 5.00%, 08/15/41

    2,780       2,883,138  

Salt Lake City Corp. Airport Revenue, ARB, Series A, AMT, 5.00%, 07/01/47

    915       1,015,705  
   

 

 

 
      3,898,843  
Virginia — 1.9%  

Hampton Roads Transportation Accountability Commission, RB, Transportation Fund, Senior Lien, Series A, 5.50%, 07/01/57

    1,095       1,294,881  

Lexington Industrial Development Authority, RB, Kendal st Lexington, Series A, 5.00%, 01/01/48

    820       879,729  

Virginia Small Business Financing Authority, RB, Senior Lien, Elizabeth River Crossings OpCo LLC Project, AMT:

   

5.25%, 01/01/32

    1,615       1,754,859  

6.00%, 01/01/37

    1,940       2,158,890  
   

 

 

 
      6,088,359  
Washington — 2.8%  

Port of Seattle Washington, ARB, Intermediate Lien, Series C, AMT, 5.00%, 05/01/42

    1,465       1,639,350  

Port of Seattle Washington, RB, Intermediate Lien, Series C, AMT, 5.00%, 04/01/40

    755       814,139  

Washington Health Care Facilities Authority, RB, Catholic Health Initiatives, Series A, 5.75%, 01/01/45

    2,290       2,496,443  

Washington Health Care Facilities Authority, Refunding RB, Catholic Health Initiatives, Series D, 6.38%, 10/01/36

    3,700       3,761,938  
   

 

 

 
      8,711,870  
Wisconsin — 3.8%  

State of Wisconsin, Refunding RB, Series A, 6.00%, 05/01/19(b)

    7,100       7,393,372  

State of Wisconsin Health & Educational Facilities Authority, RB, Ascension Health Senior Credit Group, Series E, 5.00%, 11/15/33

    2,465       2,570,945  
 

 

 

SCHEDULES OF INVESTMENTS      65  


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniVest Fund II, Inc. (MVT)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Wisconsin (continued)  

Wisconsin Health & Educational Facilities Authority, Refunding RB, Medical College of Wisconsin, Inc., 4.00%, 12/01/46

  $ 1,810     $ 1,822,978  
   

 

 

 
      11,787,295  
   

 

 

 

Total Municipal Bonds — 129.1%
(Cost — $383,524,233)

 

    405,524,131  
   

 

 

 

Municipal Bonds Transferred to Tender Option Bond Trusts(h)

 

California — 7.6%  

Bay Area Toll Authority, Refunding RB, San Francisco Bay Area:

   

Toll Bridge, 4.00%, 04/01/42(i)

    3,057       3,163,187  

Series F-1, 5.63%, 04/01/19(b)

    3,271       3,386,469  

California Educational Facilities Authority, RB, University of Southern California, Series B, 5.25%, 10/01/18(b)(i)

    2,609       2,646,816  

City & County of San Francisco California Public Utilities Commission, RB, Water Revenue, Series B, 5.00%, 11/01/19(b)

    9,480       9,926,824  

Sacramento Area Flood Control Agency, Refunding, Consolidated Capital Assessment District No. 2 Bonds, 5.00%, 10/01/47

    3,075       3,489,443  

San Diego California Community College District, GO, Election of 2002, 5.25%, 08/01/19(b)

    1,077       1,122,629  
   

 

 

 
      23,735,368  
Colorado — 0.7%  

Colorado Health Facilities Authority, Refunding RB, Catholic Health Initiatives, Series A, 5.50%, 07/01/34(i)

    2,129       2,196,861  
   

 

 

 
Florida — 1.9%  

County of Miami-Dade Florida, RB, Water & Sewer System, 5.00%, 10/01/20(b)

    5,679       6,074,834  
   

 

 

 
Maryland — 0.7%  

State of Maryland Transportation Authority, RB, Transportation Facilities Project (AGM), 5.00%, 07/01/41

    2,290       2,301,427  
   

 

 

 
Massachusetts — 1.4%  

Commonwealth of Massachusetts Transportation Fund Revenue, RB, Rail Enhancement Program, Series A, 4.00%, 06/01/45

    2,043       2,085,289  

Massachusetts School Building Authority, RB, Senior, Series B, 5.00%, 10/15/41

    2,266       2,438,955  
   

 

 

 
      4,524,244  
New Hampshire — 0.7%  

New Hampshire Health & Education Facilities Authority, RB, Dartmouth College, 5.25%, 06/01/19(b)(i)

    2,009       2,081,646  
   

 

 

 
New York — 8.0%  

City of New York New York Municipal Water Finance Authority, Refunding RB, Water & Sewer System, 2nd General Resolution, Series FF-2, 5.50%, 06/15/40

    1,575       1,638,184  

City of New York New York Water & Sewer System, Refunding RB, Water & Sewer System, 2nd General Resolution, Series DD:

   

5.00%, 06/15/18(b)

    927       929,646  

5.00%, 06/15/37

    5,372       5,385,886  

Hudson Yards Infrastructure Corp., RB, Fiscal 2012, Series A, 5.75%, 02/15/47(i)

    1,610       1,757,238  

Metropolitan Transportation Authority, Refunding RB, Series C-1, 5.25%, 11/15/56

    4,720       5,317,116  

New York Liberty Development Corp., Refunding RB, 4 World Trade Center Project, 5.75%, 11/15/51(i)

    6,440       7,126,211  

Port Authority of New York & New Jersey, Refunding ARB, 194th Series, 5.25%, 10/15/55

    2,595       2,904,333  
   

 

 

 
      25,058,614  
Security   Par
(000)
    Value  
North Carolina — 0.9%  

North Carolina Capital Facilities Finance Agency, Refunding RB, Duke University Project, Series B, 5.00%, 10/01/55

  $ 2,550     $ 2,841,159  
   

 

 

 
Ohio — 4.5%  

State of Ohio, Refunding RB, Cleveland Clinic Health System Obligated Group, Series A, 5.50%, 01/01/19(b)

    13,843       14,172,610  
   

 

 

 
Pennsylvania — 0.9%  

Pennsylvania Turnpike Commission, RB, Sub-Series A, 5.50%, 12/01/42

    2,340       2,664,729  
   

 

 

 
Rhode Island — 0.5%  

Narragansett Bay Commission, Refunding RB, Wastewater System, Series A, 4.00%, 09/01/43

    1,530       1,545,545  
   

 

 

 
South Carolina — 1.6%  

South Carolina Public Service Authority, Refunding RB, Series A(b):

   

5.50%, 01/01/19(i)

    398       407,366  

5.50%, 01/01/19

    4,603       4,710,304  
   

 

 

 
      5,117,670  
Texas — 3.3%  

City of San Antonio Texas Electric and Gas Systems, RB, Junior Lien, 5.00%, 02/01/43

    2,520       2,719,048  

County of Harris Texas Metropolitan Transit Authority, Refunding RB, Series A, 5.00%, 11/01/41

    3,400       3,669,960  

Lower Colorado River Authority, Refunding RB, LCRA Transmission Services Corporation Project, 4.00%, 05/15/43

    2,030       2,041,313  

University of Texas, Refunding RB, Financing System, Series B, 5.00%, 08/15/43

    1,831       2,011,127  
   

 

 

 
      10,441,448  
Wisconsin — 0.8%  

Wisconsin Health & Educational Facilities Authority, Refunding RB, Froedtert & Community Health, Inc., Obligated Group, Series C, 5.25%, 04/01/19(b)(i)

    2,499       2,576,270  
   

 

 

 

Total Municipal Bonds Transferred to Tender Option
Bond Trusts — 33.5%
(Cost — $102,614,799)

 

    105,332,425  
   

 

 

 

Total Long-Term Investments — 162.6%
(Cost — $486,139,032)

 

    510,856,556  
   

 

 

 
     Shares         
Short-Term Securities — 0.3%  

BlackRock Liquidity Funds, MuniCash, Institutional Class,
1.48%(j)(k)

    986,303       986,303  
   

 

 

 

Total Short-Term Securities — 0.3%
(Cost — $986,303)

 

    986,303  
   

 

 

 

Total Investments — 162.9%
(Cost — $487,125,335)

 

    511,842,859  

Other Assets Less Liabilities — 1.2%

 

    3,995,402  

Liability for TOB Trust Certificates, Including Interest Expense and Fees Payable — (19.6)%

 

    (61,577,110

VMTP Shares at Liquidation Value — (44.5)%

 

    (140,000,000
   

 

 

 

Net Assets Applicable to Common Shares — 100.0%

 

  $ 314,261,151  
   

 

 

 

 

(a) Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933, as amended. These securities may be resold in transactions exempt from registration to qualified institutional investors.
 

 

 

66    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniVest Fund II, Inc. (MVT)

 

(b)  U.S. Government securities, held in escrow, are used to pay interest on this security, as well as to retire the bond in full at the date indicated, typically at a premium to par.
(c)  Zero-coupon bond.
(d)  Variable or floating rate security, which interest rate adjusts periodically based on changes in current interest rates and prepayments on the underlying pool of assets. Rate shown is the rate in effect as of period end.
(e)  Step-up bond that pays an initial coupon rate for the first period and then a higher coupon rate for the following periods. Rate as of period end.
(f)  Security is collateralized by municipal bonds or U.S. Treasury obligations.
(g)  When-issued security.
(h)  Represent bonds transferred to a TOB Trust in exchange of cash and residual certificates received by the Fund. These bonds serve as collateral in a secured borrowing. See Note 4 of the Notes to Financial Statements for details.
(i)  All or a portion of security is subject to a recourse agreement. The aggregate maximum potential amount the Fund could ultimately be required to pay under the agreements, which expire between May 7, 2018 to April 1, 2025, is $15,744,274. See Note 4 of the Notes to Financial Statements for details.
(j)  Annualized 7-day yield as of period end.
(k)  During the year ended April 30, 2018, investments in issuers considered to be an affiliate of the Fund for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliated    Shares
Held at
04/30/17
     Net
Activity
     Shares
Held at
04/30/18
     Value at
04/30/18
     Income      Net Realized
Gain (Loss) (a)
     Change in
Unrealized

Appreciation
(Depreciation)
 

BlackRock Liquidity Funds, MuniCash, Institutional Class

     16,387        969,916        986,303      $ 986,303      $ 57,396      $ 1,630      $  
           

 

 

    

 

 

    

 

 

    

 

 

 

 

  (a)  Includes net capital gain distributions, if applicable.  

Derivative Financial Instruments Outstanding as of Period End

Futures Contracts

 

Description    Number of
Contracts
       Expiration
Date
       Notional
Amount
(000)
       Value/
Unrealized

Appreciation
(Depreciation)
 

Short Contracts:

                 

10-Year U.S. Treasury Note

     29          06/20/18        $ 3,469        $ 18,192  

Long U.S. Treasury Bond

     55          06/20/18          7,911          (5,181

5-Year U.S. Treasury Note

     18          06/29/18          2,043          9,478  
                 

 

 

 
                  $ 22,489  
                 

 

 

 

Derivative Financial Instruments Categorized by Risk Exposure

As of year end, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:

 

      Commodity
Contracts
     Credit
Contracts
     Equity
Contracts
     Foreign
Currency
Exchange
Contracts
     Interest
Rate
Contracts
     Other
Contracts
     Total  

Assets — Derivative Financial Instruments

                    

Futures contracts

                    

Net unrealized appreciation(a)

   $      $      $      $      $ 27,670      $      $ 27,670  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Liabilities — Derivative Financial Instruments

                    

Futures contracts

                    

Net unrealized appreciation(a)

   $      $      $      $      $ 5,181      $      $ 5,181  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

  (a)  Includes cumulative appreciation (depreciation) on futures contracts, if any, as reported in the Schedule of Investments. Only current day’s variation margin is report within the Statements of Assets and Liabilities.  

 

 

SCHEDULES OF INVESTMENTS      67  


Schedule of Investments  (continued)

April 30, 2018

  

BlackRock MuniVest Fund II, Inc. (MVT)

 

For the year ended April 30, 2018, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

      Commodity
Contracts
     Credit
Contracts
     Equity
Contracts
     Foreign
Currency
Exchange
Contracts
     Interest
Rate
Contracts
     Other
Contracts
     Total  

Net Realized Gain (Loss) from:

                    

Futures contracts

   $      $      $      $      $ 694,227      $      $ 694,227  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net Change in Unrealized Appreciation (Depreciation) on:

                    

Futures contracts

   $      $      $      $      $ 231,552      $      $ 231,552  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

Futures contracts

        

Average notional value of contracts — short

   $ 18,721,662  

For more information about the Fund’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.

Fair Value Hierarchy as of Period End

Various inputs are used in determining the fair value of investments and derivative financial instruments. For information about the Fund’s policy regarding valuation of investments and derivative financial instruments, refer to the Notes to Financial Statements.

The following tables summarize the Fund’s investments and derivative financial instruments categorized in the disclosure hierarchy:

 

      Level 1        Level 2        Level 3        Total  

Assets:

                 

Investments:

                 

Long-Term Investments(a)

   $        $ 510,856,556        $        $ 510,856,556  

Short-Term Securities

     986,303                            986,303  
  

 

 

      

 

 

      

 

 

      

 

 

 
   $ 986,303        $ 510,856,556        $        $ 511,842,859  
  

 

 

      

 

 

      

 

 

      

 

 

 

Derivative Financial Instruments(b)

                 

Assets:

                 

Interest rate contracts

   $ 27,670        $        $        $ 27,670  

Liabilities:

                 

Interest rate contracts

     (5,181                          (5,181
  

 

 

      

 

 

      

 

 

      

 

 

 
   $ 22,489        $        $        $ 22,489  
  

 

 

      

 

 

      

 

 

      

 

 

 

 

  (a)  See above Schedule of Investments for values in each state or political subdivision.  
  (b)  Derivative financial instruments are futures contracts which are valued at the unrealized appreciation (depreciation) on the instrument.  

The Fund may hold assets and/or liabilities in which the fair value approximates the carrying amount for financial statement purposes. As of year end, such assets and/or liabilities are categorized within the disclosure hierarchy as follows:

 

      Level 1        Level 2        Level 3        Total  

Liabilities:

 

TOB Trust Certificates

   $        $ (61,342,524      $        $ (61,342,524

VMTP Shares at Liquidation Value

              (140,000,000                 (140,000,000
  

 

 

      

 

 

      

 

 

      

 

 

 
   $        $ (201,342,524      $        $ (201,342,524
  

 

 

      

 

 

      

 

 

      

 

 

 

During the year ended April 30, 2018, there were no transfers between levels.

See notes to financial statements.

 

 

68    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Statements of Assets and Liabilities

April 30, 2018

 

     MUA     MEN     MHD     MUH  

ASSETS

 

Investments at value — unaffiliated(a)

  $ 567,231,098     $ 573,352,203     $ 380,175,549     $ 280,997,709  

Investments at value — affiliated(b)

    2,226,571             733,990       978,065  

Cash

                7,769       5,631  

Cash pledged for futures contracts

    154,950       310,900       135,550       104,200  

Receivables:

 

Interest — unaffiliated

    9,689,893       7,330,624       5,610,104       3,985,008  

TOB Trust

    1,515,000       3,285,000       2,540,000       2,500,000  

Investments sold

    455,041       1,323,344       215,785       196,966  

Dividends — affiliated

    1,947       982       589       1,530  

Capital gain distributions — affiliated

    374       2,408       617       657  

Prepaid expenses

    17,126       72,667       21,993       20,999  
 

 

 

   

 

 

   

 

 

   

 

 

 

Total assets

    581,292,000       585,678,128       389,441,946       288,790,765  
 

 

 

   

 

 

   

 

 

   

 

 

 

ACCRUED LIABILITIES

 

Bank overdraft

          395,816              

Payables:

       

Investments purchased

    2,139,537       13,039,916       6,017,267       5,614,348  

Income dividends — Common Shares

    1,962,420       1,424,711       993,385       765,199  

Interest expense and fees

    308,081       324,631       234,835       188,888  

Investment advisory fees

    259,479       232,707       172,016       125,777  

Variation margin on futures contracts

    36,531       75,719       33,125       25,875  

Directors’ and Officer’s fees

    4,223       3,123       2,076       1,525  

TOB Trust

                2,053,772       1,495,025  

Other accrued expenses

    186,297       183,177       148,391       128,564  
 

 

 

   

 

 

   

 

 

   

 

 

 

Total accrued liabilities

    4,896,568       15,679,800       9,654,867       8,345,201  
 

 

 

   

 

 

   

 

 

   

 

 

 

OTHER LIABILITIES

 

TOB Trust Certificates

    71,924,984       87,395,145       63,165,719       54,099,850  

VMTP Shares, at liquidation value of $100,000 per share(c)(d)

                83,700,000       55,000,000  

VRDP Shares, at liquidation value of $100,000 per share, net of deferred offering costs(c)(d)

          142,317,149              
 

 

 

   

 

 

   

 

 

   

 

 

 

Total other liabilities

    71,924,984       229,712,294       146,865,719       109,099,850  
 

 

 

   

 

 

   

 

 

   

 

 

 

Total liabilities

    76,821,552       245,392,094       156,520,586       117,445,051  
 

 

 

   

 

 

   

 

 

   

 

 

 

NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

  $ 504,470,448     $ 340,286,034     $ 232,921,360     $ 171,345,714  
 

 

 

   

 

 

   

 

 

   

 

 

 

NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS CONSIST OF

 

Paid-in capital(e)(f)(g)

  $ 479,963,923     $ 311,666,822     $ 211,660,385     $ 155,975,320  

Undistributed net investment income

    964,175       2,730,008       797,480       1,379,268  

Accumulated net realized loss

    (4,677,275     (1,940,503     (383,022     (533,543

Net unrealized appreciation (depreciation)

    28,219,625       27,829,707       20,846,517       14,524,669  
 

 

 

   

 

 

   

 

 

   

 

 

 

NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

  $ 504,470,448     $ 340,286,034     $ 232,921,360     $ 171,345,714  
 

 

 

   

 

 

   

 

 

   

 

 

 

Net asset value, offering and redemption price per share

  $ 14.01     $ 11.46     $ 16.41     $ 15.11  
 

 

 

   

 

 

   

 

 

   

 

 

 

(a) Investments at cost — unaffiliated

  $ 539,051,055     $ 545,575,123     $ 359,341,625     $ 266,479,992  

(b) Investments at cost — affiliated

  $ 2,226,571     $     $ 733,990     $ 978,065  

(c) Preferred Shares outstanding, par value $0.10 per share

          1,425       837       550  

(d) Preferred Shares authorized, including Auction Market Preferred Shares (“AMPS”).

          8,905       5,837       4,030  

(e) Par value per Common Shares

  $ 0.10     $ 0.10     $ 0.10     $ 0.10  

(f)  Common Shares outstanding

    36,007,711       29,681,476       14,191,210       11,336,282  

(g) Common Shares authorized

    200,000,000       199,991,095       199,994,163       199,995,970  

See notes to financial statements

 

 

FINANCIAL STATEMENTS      69  


 

Statements of Assets and Liabilities  (continued)

April 30, 2018

 

     MUS     MUI      MVT  

ASSETS

 

Investments at value — unaffiliated(a)

  $ 283,637,307     $ 926,163,318      $ 510,856,556  

Investments at value — affiliated(b)

    2,822,221              986,303  

Cash

    16,892               

Cash pledged for futures contracts

    95,150       314,900        156,050  

Receivables:

 

Interest — unaffiliated

    4,152,345       12,470,045        8,252,559  

TOB Trust

          7,085,000        1,354,873  

Investments sold

          24,763,604        675,000  

Dividends — affiliated

    1,844       9,751        5,100  

Capital gain distributions — affiliated

    398       2,879        2,609  

Prepaid expenses

    21,022       30,930        23,530  
 

 

 

   

 

 

    

 

 

 

Total assets

    290,747,179       970,840,427        522,312,580  
 

 

 

   

 

 

    

 

 

 

ACCRUED LIABILITIES

 

Bank overdraft

          1,152,799         

Payables:

 

Investments purchased

    2,491,699       14,334,019        4,697,269  

Income dividends — Common Shares

    826,661       1,704,184        1,352,886  

Interest expense and fees

    99,382       215,618        234,586  

Investment advisory fees

    121,503       428,005        210,979  

Variation margin on futures contracts

    21,000       56,625        37,406  

Directors’ and Officer’s fees

    1,580       316,767        2,786  

TOB Trust

          14,396,337         

Other accrued expenses

    128,810       231,740        172,993  
 

 

 

   

 

 

    

 

 

 

Total accrued liabilities

    3,690,635       32,836,094        6,708,905  
 

 

 

   

 

 

    

 

 

 

OTHER LIABILITIES

 

TOB Trust Certificates

    26,238,374       79,135,643        61,342,524  

VMTP Shares, at liquidation value of $100,000 per share(c)(d)

    87,000,000       287,100,000        140,000,000  
 

 

 

   

 

 

    

 

 

 

Total other liabilities

    113,238,374       366,235,643        201,342,524  
 

 

 

   

 

 

    

 

 

 

Total liabilities

    116,929,009       399,071,737        208,051,429  
 

 

 

   

 

 

    

 

 

 

NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

  $ 173,818,170     $ 571,768,690      $ 314,261,151  
 

 

 

   

 

 

    

 

 

 

NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS CONSIST OF

 

Paid-in capital(e)(f)(g)

  $ 168,134,858     $ 543,452,920      $ 289,451,564  

Undistributed net investment income

    1,190,147       1,116,863        1,315,017  

Undistributed net realized gain (accumulated net realized loss)

    (7,433,603     303,773        (1,245,443

Net unrealized appreciation (depreciation)

    11,926,768       26,895,134        24,740,013  
 

 

 

   

 

 

    

 

 

 

NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

  $ 173,818,170     $ 571,768,690      $ 314,261,151  
 

 

 

   

 

 

    

 

 

 

Net asset value, offering and redemption price per share

  $ 13.35     $ 14.93      $ 14.75  
 

 

 

   

 

 

    

 

 

 

(a) Investments at cost — unaffiliated

  $ 271,759,716     $ 899,456,664      $ 486,139,032  

(b) Investments at cost — affiliated

  $ 2,822,221     $      $ 986,303  

(c) Preferred Shares outstanding, par value $0.10 per share

    870       2,871        1,400  

(d) Preferred Shares authorized, including Auction Market Preferred Shares (“AMPS”).

    6,230       15,671        8,400  

(e) Par value per Common Shares

  $ 0.10     $ 0.10      $ 0.10  

(f)  Common Shares outstanding

    13,018,276       38,296,266        21,305,383  

(g) Common Shares authorized

    199,993,770       199,984,329        199,991,600  

See notes to financial statements

 

 

70    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Statements of Operations

Year Ended April 30, 2018

 

     MUA     MEN     MHD     MUH  

INVESTMENT INCOME

 

Interest — unaffiliated

  $ 29,284,555     $ 24,685,354     $ 17,622,032     $ 12,816,581  

Dividends — affiliated

    24,826       30,721       25,710       19,198  
 

 

 

   

 

 

   

 

 

   

 

 

 

Total investment income

    29,309,381       24,716,075       17,647,742       12,835,779  
 

 

 

   

 

 

   

 

 

   

 

 

 

EXPENSES

 

Investment advisory

    3,172,580       2,843,510       2,125,137       1,539,665  

Professional

    85,230       89,407       76,175       66,308  

Accounting services

    83,715       82,506       58,710       45,783  

Transfer agent

    55,268       38,611       25,709       22,490  

Directors and Officer

    50,977       34,933       23,830       17,527  

Custodian

    25,758       25,541       16,734       12,338  

Registration

    13,875       11,722       9,534       9,481  

Printing

    11,969       10,610       9,643       9,176  

Rating agency

          41,024       40,922       40,874  

Miscellaneous

    43,404       44,783       35,239       29,420  
 

 

 

   

 

 

   

 

 

   

 

 

 

Total expenses excluding interest expense, fees and amortization of offering costs

    3,542,776       3,222,647       2,421,633       1,793,062  

Interest expense, fees and amortization of offering costs(a)

    1,184,596       4,015,096       2,772,539       1,947,236  
 

 

 

   

 

 

   

 

 

   

 

 

 

Total expenses

    4,727,372       7,237,743       5,194,172       3,740,298  

Less fees waived and/or reimbursed by the Manager

    (3,077     (3,333     (3,248     (2,330
 

 

 

   

 

 

   

 

 

   

 

 

 

Total expenses after fees waived and/or reimbursed

    4,724,295       7,234,410       5,190,924       3,737,968  
 

 

 

   

 

 

   

 

 

   

 

 

 

Net investment income

    24,585,086       17,481,665       12,456,818       9,097,811  
 

 

 

   

 

 

   

 

 

   

 

 

 

REALIZED AND UNREALIZED GAIN (LOSS)

 

Net realized gain (loss) from:

 

Investments — unaffiliated

    3,247,648       5,387       (272,231     (132,735

Investments — affiliated

    (114     (2,272     (95     (183

Futures contracts

    613,477       1,311,360       547,023       481,810  

Capital gain distributions from investment companies — affiliated

    374       2,408       617       657  
 

 

 

   

 

 

   

 

 

   

 

 

 
    3,861,385       1,316,883       275,314       349,549  
 

 

 

   

 

 

   

 

 

   

 

 

 

Net change in unrealized appreciation (depreciation) on:

       

Investments — unaffiliated

    (6,394,950     (9,514,232     (5,933,179     (4,469,334

Investments — affiliated

    (96     (217     (57     (71

Futures contracts

    279,076       523,755       250,959       133,767  
 

 

 

   

 

 

   

 

 

   

 

 

 
    (6,115,970     (8,990,694     (5,682,277     (4,335,638
 

 

 

   

 

 

   

 

 

   

 

 

 

Net realized and unrealized loss

    (2,254,585     (7,673,811     (5,406,963     (3,986,089
 

 

 

   

 

 

   

 

 

   

 

 

 

NET INCREASE IN NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS RESULTING FROM OPERATIONS

  $ 22,330,501     $ 9,807,854     $ 7,049,855     $ 5,111,722  
 

 

 

   

 

 

   

 

 

   

 

 

 

 

(a) Related to TOB Trusts, VRDP Shares and/or VMTP Shares.

See notes to financial statements.

 

 

FINANCIAL STATEMENTS      71  


 

Statements of Operations  (continued)

Year Ended April 30, 2018

 

     MUS     MUI     MVT  

INVESTMENT INCOME

 

Interest — unaffiliated

  $ 13,194,846     $ 35,388,095     $ 24,311,929  

Dividends — affiliated

    21,007       69,558       57,396  
 

 

 

   

 

 

   

 

 

 

Total investment income

    13,215,853       35,457,653       24,369,325  
 

 

 

   

 

 

   

 

 

 

EXPENSES

 

Investment advisory

    1,632,619       5,201,127       2,611,180  

Professional

    71,490       108,817       82,522  

Accounting services

    47,804       118,937       78,149  

Transfer agent

    21,608       47,184       31,866  

Directors and Officer

    17,925       72,988       32,015  

Custodian

    14,304       41,313       22,697  

Registration

    9,436       14,785       9,834  

Printing

    9,003       12,453       10,294  

Rating agency

    40,931       41,267       41,021  

Miscellaneous

    26,132       45,863       34,562  
 

 

 

   

 

 

   

 

 

 

Total expenses excluding interest expense, fees and amortization of offering costs

    1,891,252       5,704,734       2,954,140  

Interest expense, fees and amortization of offering costs(a)

    2,256,188       7,035,872       3,862,101  
 

 

 

   

 

 

   

 

 

 

Total expenses

    4,147,440       12,740,606       6,816,241  

Less fees waived and/or reimbursed by the Manager

    (105,932     (7,259     (6,318
 

 

 

   

 

 

   

 

 

 

Total expenses after fees waived and/or reimbursed

    4,041,508       12,733,347       6,809,923  
 

 

 

   

 

 

   

 

 

 

Net investment income

    9,174,345       22,724,306       17,559,402  
 

 

 

   

 

 

   

 

 

 

REALIZED AND UNREALIZED GAIN (LOSS)

 

Net realized gain (loss) from:

 

Investments — unaffiliated

    (102,554     494,522       214,527  

Investments — affiliated

    1,905       (1,993     (979

Futures contracts

    391,526       2,154,823       694,227  

Capital gain distributions from investment companies — affiliated

    398       2,879       2,609  
 

 

 

   

 

 

   

 

 

 
    291,275       2,650,231       910,384  
 

 

 

   

 

 

   

 

 

 

Net change in unrealized appreciation (depreciation) on:

     

Investments

    (7,563,960     (12,438,237     (9,813,533

Investments — affiliated

          (180      

Futures contracts

    181,278       827,962       231,552  
 

 

 

   

 

 

   

 

 

 
    (7,382,682     (11,610,455     (9,581,981
 

 

 

   

 

 

   

 

 

 

Net realized and unrealized loss

    (7,091,407     (8,960,224     (8,671,597
 

 

 

   

 

 

   

 

 

 

NET INCREASE IN NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS RESULTING FROM OPERATIONS

  $ 2,082,938     $ 13,764,082     $ 8,887,805  
 

 

 

   

 

 

   

 

 

 

 

(a) Related to TOB Trusts and/or VMTP Shares.

See notes to financial statements.

 

 

72    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Statements of Changes in Net Assets

 

    MUA  
    Year Ended April 30,  
     2018     2017  

INCREASE (DECREASE) IN NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

 

OPERATIONS

 

Net investment income

  $ 24,585,086     $ 25,298,067  

Net realized gain (loss)

    3,861,385       (6,103,677

Net change in unrealized appreciation (depreciation)

    (6,115,970     (7,831,985
 

 

 

   

 

 

 

Net increase in net assets applicable to Common Shareholders resulting from operations

    22,330,501       11,362,405  
 

 

 

   

 

 

 

DISTRIBUTIONS TO COMMON SHAREHOLDERS(a)

 

From net investment income

    (24,403,775     (24,955,313
 

 

 

   

 

 

 

CAPITAL SHARE TRANSACTIONS

 

Reinvestment of common distributions

    1,238,029       1,201,178  
 

 

 

   

 

 

 

NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

 

Total decrease in net assets applicable to Common Shareholders

    (835,245     (12,391,730

Beginning of year

    505,305,693       517,697,423  
 

 

 

   

 

 

 

End of year

  $ 504,470,448     $ 505,305,693  
 

 

 

   

 

 

 

Undistributed net investment income, end of year

  $ 964,175     $ 784,805  
 

 

 

   

 

 

 

 

(a)  Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

See notes to financial statements.

 

 

FINANCIAL STATEMENTS      73  


 

Statements of Changes in Net Assets  (continued)

 

    MEN  
    Year Ended April 30,  
     2018     2017  

INCREASE (DECREASE) IN NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

 

OPERATIONS

 

Net investment income

  $ 17,481,665     $ 19,135,096  

Net realized gain

    1,316,883       2,216,473  

Net change in unrealized appreciation (depreciation)

    (8,990,694     (23,080,927
 

 

 

   

 

 

 

Net increase (decrease) in net assets applicable to Common Shareholders resulting from operations

    9,807,854       (1,729,358
 

 

 

   

 

 

 

DISTRIBUTIONS TO COMMON SHAREHOLDERS(a)

 

From net investment income

    (19,006,534     (20,244,836
 

 

 

   

 

 

 

CAPITAL SHARE TRANSACTIONS

 

Reinvestment of common distributions

    447,450       669,394  
 

 

 

   

 

 

 

NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

 

Total decrease in net assets applicable to Common Shareholders

    (8,751,230     (21,304,800

Beginning of year

    349,037,264       370,342,064  
 

 

 

   

 

 

 

End of year

  $ 340,286,034     $ 349,037,264  
 

 

 

   

 

 

 

Undistributed net investment income, end of year

  $ 2,730,008     $ 4,294,820  
 

 

 

   

 

 

 

 

(a) Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

See notes to financial statements.

 

 

74    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Statements of Changes in Net Assets  (continued)

 

    MHD  
    Year Ended April 30,  
     2018     2017  

INCREASE (DECREASE) IN NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

 

OPERATIONS

 

Net investment income

  $ 12,456,818     $ 13,423,611  

Net realized gain

    275,314       1,929,867  

Net change in unrealized appreciation (depreciation)

    (5,682,277     (17,165,235
 

 

 

   

 

 

 

Net increase (decrease) in net assets applicable to Common Shareholders resulting from operations

    7,049,855       (1,811,757
 

 

 

   

 

 

 

DISTRIBUTIONS TO COMMON SHAREHOLDERS(a)

 

From net investment income

    (13,034,780     (13,833,972

From net realized gain

    (189,283      
 

 

 

   

 

 

 

Decrease in net assets resulting from distributions to Common Shareholders

    (13,224,063     (13,833,972
 

 

 

   

 

 

 

CAPITAL SHARE TRANSACTIONS

 

Reinvestment of common distributions

    411,605       465,879  
 

 

 

   

 

 

 

NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

 

Total decrease in net assets applicable to Common Shareholders

    (5,762,603     (15,179,850

Beginning of year

    238,683,963       253,863,813  
 

 

 

   

 

 

 

End of year

  $ 232,921,360     $ 238,683,963  
 

 

 

   

 

 

 

Undistributed net investment income, end of year

  $ 797,480     $ 1,705,148  
 

 

 

   

 

 

 

 

(a) Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

See notes to financial statements.

 

 

FINANCIAL STATEMENTS      75  


 

Statements of Changes in Net Assets  (continued)

 

    MUH  
    Year Ended April 30,  
     2018     2017  

INCREASE (DECREASE) IN NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

   

OPERATIONS

   

Net investment income

  $ 9,097,811     $ 9,771,566  

Net realized gain

    349,549       1,537,795  

Net change in unrealized appreciation (depreciation)

    (4,335,638     (12,368,643
 

 

 

   

 

 

 

Net increase (decrease) in net assets applicable to Common Shareholders resulting from operations

    5,111,722       (1,059,282
 

 

 

   

 

 

 

DISTRIBUTIONS TO COMMON SHAREHOLDERS(a)

   

From net investment income

    (9,599,378     (10,145,858

From net realized gain

    (94,182      
 

 

 

   

 

 

 

Decrease in net assets resulting from distributions to Common Shareholders

    (9,693,560     (10,145,858
 

 

 

   

 

 

 

CAPITAL SHARE TRANSACTIONS

   

Reinvestment of common distributions

    290,507       288,874  
 

 

 

   

 

 

 

NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

   

Total decrease in net assets applicable to Common Shareholders

    (4,291,331     (10,916,266

Beginning of year

    175,637,045       186,553,311  
 

 

 

   

 

 

 

End of year

  $ 171,345,714     $ 175,637,045  
 

 

 

   

 

 

 

Undistributed net investment income, end of year

  $ 1,379,268     $ 2,125,474  
 

 

 

   

 

 

 

 

(a)  Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

See notes to financial statements.

 

 

76    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Statements of Changes in Net Assets  (continued)

 

    MUS  
    Year Ended April 30,  
     2018     2017  

INCREASE (DECREASE) IN NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

   

OPERATIONS

   

Net investment income

  $ 9,174,345     $ 9,805,483  

Net realized gain

    291,275       544,766  

Net change in unrealized appreciation (depreciation)

    (7,382,682     (11,494,637
 

 

 

   

 

 

 

Net increase (decrease) in net assets applicable to Common Shareholders resulting from operations

    2,082,938       (1,144,388
 

 

 

   

 

 

 

DISTRIBUTIONS TO COMMON SHAREHOLDERS(a)

   

From net investment income

    (9,919,384     (10,437,391
 

 

 

   

 

 

 

CAPITAL SHARE TRANSACTIONS

   

Reinvestment of common distributions

    40,885       85,253  
 

 

 

   

 

 

 

NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

   

Total decrease in net assets applicable to Common Shareholders

    (7,795,561     (11,496,526

Beginning of year

    181,613,731       193,110,257  
 

 

 

   

 

 

 

End of year

  $ 173,818,170     $ 181,613,731  
 

 

 

   

 

 

 

Undistributed net investment income, end of year

  $ 1,190,147     $ 1,936,649  
 

 

 

   

 

 

 

 

(a)  Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

See notes to financial statements.

 

 

FINANCIAL STATEMENTS      77  


 

Statements of Changes in Net Assets  (continued)

 

    MUI  
    Year Ended April 30,  
     2018     2017  

INCREASE (DECREASE) IN NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

 

OPERATIONS

 

Net investment income

  $ 22,724,306     $ 24,790,887  

Net realized gain

    2,650,231       1,224,930  

Net change in unrealized appreciation (depreciation)

    (11,610,455     (32,802,123
 

 

 

   

 

 

 

Net increase (decrease) in net assets applicable to Common Shareholders resulting from operations

    13,764,082       (6,786,306
 

 

 

   

 

 

 

DISTRIBUTIONS TO COMMON SHAREHOLDERS(a)

 

From net investment income

    (22,880,908     (25,757,762

From net realized gain

    (59,474     (5,481,919
 

 

 

   

 

 

 

Decrease in net assets resulting from distributions to Common Shareholders

    (22,940,382     (31,239,681
 

 

 

   

 

 

 

NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

 

Total decrease in net assets applicable to Common Shareholders

    (9,176,300     (38,025,987

Beginning of year

    580,944,990       618,970,977  
 

 

 

   

 

 

 

End of year

  $ 571,768,690     $ 580,944,990  
 

 

 

   

 

 

 

Undistributed net investment income, end of year

  $ 1,116,863     $ 2,528,749  
 

 

 

   

 

 

 

 

(a) Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

See notes to financial statements.

 

 

78    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Statements of Changes in Net Assets  (continued)

 

    MVT  
    Year Ended April 30,  
     2018     2017  

INCREASE (DECREASE) IN NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

 

OPERATIONS

 

Net investment income

  $ 17,559,402     $ 19,206,316  

Net realized gain

    910,384       820,955  

Net change in unrealized appreciation (depreciation)

    (9,581,981     (20,760,264
 

 

 

   

 

 

 

Net increase (decrease) in net assets applicable to Common Shareholders resulting from operations

    8,887,805       (732,993
 

 

 

   

 

 

 

DISTRIBUTIONS TO COMMON SHAREHOLDERS(a)

 

From net investment income

    (18,273,763     (19,904,361
 

 

 

   

 

 

 

CAPITAL SHARE TRANSACTIONS

   

Reinvestment of common distributions

    1,708,157       1,823,631  
 

 

 

   

 

 

 

NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

 

Total decrease in net assets applicable to Common Shareholders

    (7,677,801     (18,813,723

Beginning of year

    321,938,952       340,752,675  
 

 

 

   

 

 

 

End of year

  $ 314,261,151     $ 321,938,952  
 

 

 

   

 

 

 

Undistributed net investment income, end of year

  $ 1,315,017     $ 2,059,292  
 

 

 

   

 

 

 

 

(a)  Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

See notes to financial statements.

 

 

FINANCIAL STATEMENTS      79  


 

Statements of Cash Flows

Year Ended April 30, 2018

 

     MUA     MEN     MHD     MUH  

CASH PROVIDED BY (USED FOR) OPERATING ACTIVITIES

 

Net increase in net assets resulting from operations

  $ 22,330,501     $ 9,807,854     $ 7,049,855     $ 5,111,722  

Adjustments to reconcile net increase in net assets resulting from operations to net cash provided by operating activities:

 

Proceeds from sales of long-term investments

    84,456,372       115,124,613       36,298,386       43,701,587  

Purchases of long-term investments

    (88,998,052     (131,162,814     (37,605,309     (49,481,632

Net (purchases) sales of short-term securities

    (1,169,295     1,790,923       (158,456     (265,816

Amortization of premium and accretion of discount on investments and other fees

    292,220       (458,872     391,760       26,105  

Net realized (gain) loss on investments

    (3,247,534     (3,115     272,326       132,918  

Net unrealized depreciation on investments

    6,395,046       9,514,449       5,933,236       4,469,405  
(Increase) Decrease in Assets:  

Cash pledged for futures contracts

    335,000       551,000       381,000       182,000  

Receivables:

 

Interest — unaffiliated

    96,987       (15,627     19,659       33,328  

Dividends — affiliated

    (1,112     1,205       372       (672

Capital gain distributions — affiliated

    (374     (2,408     (617     (657

Prepaid expenses

    (578     (5,939     (6,447     (6,861
Increase (Decrease) in Liabilities:  

Payables:

 

Investment advisory fees

    411       722       (2,347     (297

Interest expense and fees

    134,040       156,069       91,768       79,613  

Directors’ and Officer’s fees

    (221     (423     (288     (203

Variation margin on futures contracts

    9,125       27,361       3,172       9,297  

Other accrued expenses

    (17,210     (11,707     (9,217     (5,230
 

 

 

   

 

 

   

 

 

   

 

 

 

Net cash provided by (used for) operating activities

    20,615,326       5,313,291       12,658,853       3,984,607  
 

 

 

   

 

 

   

 

 

   

 

 

 

CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES

 

Proceeds from TOB Trust Certificates

    4,323,529       17,661,680       3,448,081       7,758,362  

Repayments of TOB Trust Certificates

    (1,420,922     (4,374,886     (3,001,888     (2,170,452

Proceeds from Loan for TOB Trust Certificates

    1,420,922       1,336,064              

Repayments of Loan for TOB Trust Certificates

    (1,670,068     (1,336,064            

Cash dividends paid to Common Shareholders

    (23,268,787     (18,809,261     (12,966,613     (9,481,026

Increase (decrease) in bank overdraft

          199,205       (130,664     (85,860

Amortization of deferred offering costs

          9,971              
 

 

 

   

 

 

   

 

 

   

 

 

 

Net cash provided by (used for) financing activities

    (20,615,326     (5,313,291     (12,651,084     (3,978,976
 

 

 

   

 

 

   

 

 

   

 

 

 

CASH

 

Net increase (decrease) in cash

                7,769       5,631  

Cash at beginning of year

                       
 

 

 

   

 

 

   

 

 

   

 

 

 

Cash at end of year

  $     $     $ 7,769     $ 5,631  
 

 

 

   

 

 

   

 

 

   

 

 

 

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

 

Cash paid during the year for interest expense

  $ 1,050,556     $ 3,859,027     $ 2,680,771     $ 1,867,623  
 

 

 

   

 

 

   

 

 

   

 

 

 

NON-CASH FINANCING ACTIVITIES

 

Capital shares issued in reinvestment of distributions paid to Common Shareholders

  $ 1,238,029     $ 447,450     $ 411,605     $ 290,507  
 

 

 

   

 

 

   

 

 

   

 

 

 

See notes to financial statements.

 

 

80    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Statements of Cash Flows  (continued)

Year Ended April 30, 2018

 

     MUS     MUI     MVT  

CASH PROVIDED BY (USED FOR) OPERATING ACTIVITIES

 

Net increase in net assets resulting from operations

  $ 2,082,938     $ 13,764,082     $ 8,887,805  

Adjustments to reconcile net increase in net assets resulting from operations to net cash provided by operating activities:

 

Proceeds from sales of long-term investments

    61,776,155       298,212,775       57,450,695  

Purchases of long-term investments

    (62,855,675     (342,143,424     (58,925,960

Net (purchases) sales of short-term securities

    2,761,496       4,694,213       (970,892

Amortization of premium and accretion of discount on investments and other fees

    1,196,574       6,802,097       1,064,142  

Net realized (gain) loss on investments

    100,649       (492,529     (213,548

Net unrealized depreciation on investments

    7,563,960       12,438,417       9,813,533  
(Increase) Decrease in Assets:  

Cash pledged for futures contracts

    177,000       847,000       322,000  

Receivables:

 

Interest — unaffiliated

    113,745       344,198       78,478  

Dividends — affiliated

    (480     (5,837     (3,428

Variation margin on futures contracts

          2,031        

Capital gain distributions — affiliated

    (398     (2,879     (2,609

Prepaid expenses

    (6,769     (4,950     (5,998
Increase (Decrease) in Liabilities:  

Payables:

 

Investment advisory fees

    (4,759     9,980       (6,862

Interest expense and fees

    40,863       108,798       87,550  

Directors’ and Officer’s fees

    (245     12,702       (438

Variation margin on futures contracts

    6,079       (4,310     10,219  

Other accrued expenses

    (8,893     (35,461     (19,080
 

 

 

   

 

 

   

 

 

 

Net cash provided by (used for) operating activities

    12,942,240       (5,453,097     17,565,607  
 

 

 

   

 

 

   

 

 

 

CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES

 

Proceeds from TOB Trust Certificates

    638,750       28,110,130       4,674,295  

Repayments of TOB Trust Certificates

    (3,549,969           (5,261,524

Proceeds from Loan for TOB Trust Certificates

    638,750              

Repayments of Loan for TOB Trust Certificates

    (638,750            

Cash dividends paid to Common Shareholders

    (9,878,314     (23,361,641     (16,759,825

Increase (decrease) in bank overdraft

    (135,815     704,608       (218,553
 

 

 

   

 

 

   

 

 

 

Net cash provided by (used for) financing activities

    (12,925,348     5,453,097       (17,565,607
 

 

 

   

 

 

   

 

 

 

CASH

 

Net increase (decrease) in cash

    16,892              

Cash at beginning of year

                 
 

 

 

   

 

 

   

 

 

 

Cash at end of year

  $ 16,892     $     $  
 

 

 

   

 

 

   

 

 

 

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

 

Cash paid during the year for interest expense

  $ 2,215,325     $ 6,927,074     $ 3,774,551  
 

 

 

   

 

 

   

 

 

 

NON-CASH FINANCING ACTIVITIES

 

Capital shares issued in reinvestment of distributions paid to Common Shareholders

  $ 40,885     $     $ 1,708,157  
 

 

 

   

 

 

   

 

 

 

See notes to financial statements.

 

 

FINANCIAL STATEMENTS      81  


Financial Highlights

(For a share outstanding throughout each period)

 

    MUA  
    Year Ended April 30,  
    2018      2017      2016      2015      2014  

Net asset value, beginning of year

  $ 14.07      $ 14.45      $ 14.12      $ 13.56      $ 14.36  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income(a)

    0.68        0.70        0.72        0.73        0.77  

Net realized and unrealized gain (loss)

    (0.06      (0.38      0.35        0.59        (0.82
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net increase (decrease) from investment operations

    0.62        0.32        1.07        1.32        (0.05
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Distributions to Common Shareholders from net investment income(b)

    (0.68      (0.70      (0.74      (0.76      (0.75
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net asset value, end of year

  $ 14.01      $ 14.07      $ 14.45      $ 14.12      $ 13.56  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Market price, end of year

  $ 13.21      $ 14.82      $ 14.74      $ 14.22      $ 12.85  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total Return Applicable to Common Shareholders(c)

 

Based on net asset value

    4.47      2.23      7.90      10.11      0.47
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Based on market price

    (6.48 )%       5.56      9.30      17.02      (2.06 )% 
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Ratios to Average Net Assets Applicable to Common Shareholders

 

Total expenses

    0.93      0.87      0.81      0.82      0.82
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total expenses after fees waived and/or reimbursed and paid indirectly

    0.93      0.87      0.81      0.82      0.82
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total expenses after fees waived and/or reimbursed and paid indirectly and excluding interest expense, fees and amortization of offering costs(d)

    0.69      0.69      0.70      0.71      0.70
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income to Common Shareholders

    4.83      4.93      5.09      5.24      5.84
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Supplemental Data

 

Net assets applicable to Common Shareholders, end of year (000)

  $ 504,470      $ 505,306      $ 517,697      $ 505,341      $ 485,319  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Borrowings outstanding, end of year (000)

  $ 71,925      $ 67,507      $ 66,087      $ 61,066      $ 71,145  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Portfolio turnover rate

    15      11      18      22      19
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

(a) Based on average Common Shares outstanding.
(b) Distributions for annual periods determined in accordance with U.S. federal income tax regulations.
(c) Total returns based on market price, which can be significantly greater or less than the net asset value, may result in substantially different returns. Where applicable, excludes the effects of any sales charges and assumes the reinvestment of distributions at actual reinvestment prices.
(d) Interest expense and fees relate to TOB Trusts. See Note 4 of the Notes to Financial Statements for details.

See notes to financial statements.

 

 

82    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Financial Highlights  (continued)

(For a share outstanding throughout each period)

 

    MEN  
    Year Ended April 30,  
     2018      2017      2016      2015      2014  

Net asset value, beginning of year

  $ 11.77      $ 12.52      $ 12.27      $ 11.94      $ 12.63  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income(a)

    0.59        0.65        0.70        0.71        0.73  

Net realized and unrealized gain (loss)

    (0.26      (0.72      0.28        0.35        (0.70
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net increase (decrease) from investment operations

    0.33        (0.07      0.98        1.06        0.03  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Distributions to Common Shareholders from net investment income(b)

    (0.64      (0.68      (0.73      (0.73      (0.72
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net asset value, end of year

  $ 11.46      $ 11.77      $ 12.52      $ 12.27      $ 11.94  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Market price, end of year

  $ 10.48      $ 11.69      $ 12.55      $ 11.67      $ 11.27  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total Return Applicable to Common Shareholders(c)

 

Based on net asset value

    2.93      (0.51 )%       8.50      9.49      1.06
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Based on market price

    (5.23 )%       (1.42 )%       14.35      10.33      (4.76 )% 
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Ratios to Average Net Assets Applicable to Common Shareholders

 

Total expenses

    2.06      1.73      1.44      1.44      1.50
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total expenses after fees waived and/or reimbursed and paid indirectly

    2.06      1.73      1.44      1.43      1.50
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total expenses after fees waived and/or reimbursed and paid indirectly and excluding interest expense, fees and amortization of offering costs(d)

    0.92      0.89      0.90      0.91      0.92
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income to Common Shareholders

    4.97      5.29      5.71      5.76      6.37
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Supplemental Data

 

Net assets applicable to Common Shareholders, end of year (000)

  $ 340,286      $ 349,037      $ 370,342      $ 362,703      $ 352,878  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

VRDP Shares outstanding at $100,000 liquidation value, end of year (000)

  $ 142,500      $ 142,500      $ 142,500      $ 142,500      $ 142,500  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Asset coverage per VRDP Shares at $100,000 liquidation value, end of year

  $ 338,797      $ 344,938      $ 359,889      $ 354,528      $ 347,633  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Borrowings outstanding, end of year (000)

  $ 87,395      $ 70,823      $ 67,160      $ 76,094      $ 73,379  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Portfolio turnover rate

    21      12      10      12      16
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

(a) Based on average Common Shares outstanding.
(b) Distributions for annual periods determined in accordance with U.S. federal income tax regulations.
(c) Total returns based on market price, which can be significantly greater or less than the net asset value, may result in substantially different returns. Where applicable, excludes the effects of any sales charges and assumes the reinvestment of distributions at actual reinvestment prices.
(d) Interest expense, fees and amortization of offering costs related to TOB Trusts and/or VRDP Shares. See Note 4 and Note 10 of the Notes to Financial Statements for details.

See notes to financial statements.

 

 

FINANCIAL HIGHLIGHTS      83  


Financial Highlights  (continued)

(For a share outstanding throughout each period)

 

    MHD  
    Year Ended April 30,  
     2018      2017      2016      2015      2014  

Net asset value, beginning of year

  $ 16.85      $ 17.95      $ 17.59      $ 16.85      $ 18.12  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income(a)

    0.88        0.95        1.00        1.03        1.04  

Net realized and unrealized gain (loss)

    (0.39      (1.07      0.42        0.77        (1.22
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net increase (decrease) from investment operations

    0.49        (0.12      1.42        1.80        (0.18
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
Distributions to Common Shareholders(b)  

From net investment income

    (0.92      (0.98      (1.06      (1.06      (1.08

From net realized gain

    (0.01                           (0.01
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total distributions to Common Shareholders

    (0.93      (0.98      (1.06      (1.06      (1.09
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net asset value, end of year

  $ 16.41      $ 16.85      $ 17.95      $ 17.59      $ 16.85  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Market price, end of year

  $ 14.98      $ 16.65      $ 18.14      $ 17.25      $ 16.01  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total Return Applicable to Common Shareholders(c)

 

Based on net asset value

    3.07      (0.67 )%       8.65      11.22      (0.15 )% 
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Based on market price

    (4.79 )%       (2.87 )%       11.91      14.80      (5.55 )% 
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Ratios to Average Net Assets Applicable to Common Shareholders

 

Total expenses

    2.16      1.87      1.53      1.50      1.64
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total expenses after fees waived and/or reimbursed and paid indirectly

    2.16      1.87      1.53      1.50      1.64
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total expenses after fees waived and/or reimbursed and paid indirectly and excluding interest expense, fees and amortization of offering costs(d)

    1.01      0.99      0.99      0.99      1.04
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income to Common Shareholders

    5.19      5.42      5.75      5.86      6.48
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Supplemental Data

 

Net assets applicable to Common Shareholders, end of year (000)

  $ 232,921      $ 238,684      $ 253,864      $ 248,646      $ 238,113  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

VMTP Shares outstanding at $100,000 liquidation value, end of year (000)

  $ 83,700      $ 83,700      $ 83,700      $ 83,700      $ 83,700  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Asset coverage per VMTP Shares at $100,000 liquidation value, end of year

  $ 378,281      $ 385,166      $ 403,302      $ 397,068      $ 384,484  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Borrowings outstanding, end of year (000)

  $ 63,166      $ 62,233      $ 60,289      $ 56,784      $ 60,238  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Portfolio turnover rate

    12      9      7      11      20
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

(a) Based on average Common Shares outstanding.
(b) Distributions for annual periods determined in accordance with U.S. federal income tax regulations.
(c) Total returns based on market price, which can be significantly greater or less than the net asset value, may result in substantially different returns. Where applicable, excludes the effects of any sales charges and assumes the reinvestment of distributions at actual reinvestment prices.
(d) Interest expense, fees and amortization of offering costs related to TOB Trusts and/or VMTP Shares. See Note 4 and Note 10 of the Notes to Financial Statements for details.

See notes to financial statements.

 

 

84    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Financial Highlights  (continued)

(For a share outstanding throughout each period)

 

    MUH  
    Year Ended April 30,  
     2018      2017      2016      2015      2014  

Net asset value, beginning of year

  $ 15.52      $ 16.51      $ 16.21      $ 15.61      $ 16.93  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income(a)

    0.80        0.86        0.91        0.93        0.95  

Net realized and unrealized gain (loss)

    (0.35      (0.95      0.33        0.64        (1.17
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net increase (decrease) from investment operations

    0.45        (0.09      1.24        1.57        (0.22
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
Distributions to Common Shareholders(b)                                  

From net investment income

    (0.85      (0.90      (0.94      (0.97      (1.00

From net realized gain

    (0.01                           (0.10
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total distributions to Common Shareholders

    (0.86      (0.90      (0.94      (0.97      (1.10
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net asset value, end of year

  $ 15.11      $ 15.52      $ 16.51      $ 16.21      $ 15.61  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Market price, end of year

  $ 13.75      $ 15.59      $ 16.23      $ 15.28      $ 14.84  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total Return Applicable to Common Shareholders(c)

             

Based on net asset value

    3.09      (0.52 )%       8.25      10.64      (0.40 )% 
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Based on market price

    (6.61 )%       1.65      12.90      9.71      (4.30 )% 
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Ratios to Average Net Assets Applicable to Common Shareholders

             

Total expenses

    2.12      1.83      1.50      1.48      1.61
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total expenses after fees waived and/or reimbursed and paid indirectly

    2.12      1.83      1.50      1.48      1.61
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total expenses after fees waived and/or reimbursed and paid indirectly and excluding interest expense, fees and amortization of offering costs(d)

    1.02      1.00      1.00      1.00      1.04
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income to Common Shareholders

    5.16      5.37      5.66      5.76      6.36
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Supplemental Data

             

Net assets applicable to Common Shareholders, end of year (000)

  $ 171,346      $ 175,637      $ 186,553      $ 183,214      $ 176,395  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

VMTP Shares outstanding at $100,000 liquidation value, end of year (000)

  $ 55,000      $ 55,000      $ 55,000      $ 55,000      $ 55,000  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Asset coverage per VMTP Shares at $100,000 liquidation value, end of year

  $ 411,538      $ 419,340      $ 439,188      $ 433,117      $ 420,718  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Borrowings outstanding, end of year (000)

  $ 54,100      $ 47,507      $ 46,103      $ 43,568      $ 48,497  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Portfolio turnover rate

    16      10      7      11      18
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

(a)  Based on average Common Shares outstanding.
(b) Distributions for annual periods determined in accordance with U.S. federal income tax regulations.
(c) Total returns based on market price, which can be significantly greater or less than the net asset value, may result in substantially different returns. Where applicable, excludes the effects of any sales charges and assumes the reinvestment of distributions at actual reinvestment prices.
(d)  Interest expense, fees and amortization of offering costs related to TOB Trusts and/or VMTP Shares. See Note 4 and Note 10 of the Notes to Financial Statements for details.

See notes to financial statements.

 

 

FINANCIAL HIGHLIGHTS      85  


Financial Highlights  (continued)

(For a share outstanding throughout each period)

 

    MUS  
    Year Ended April 30,  
     2018      2017      2016      2015      2014  

Net asset value, beginning of year

  $ 13.95      $ 14.84      $ 14.57      $ 14.18      $ 15.31  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income(a)

    0.70        0.75        0.80        0.80        0.82  

Net realized and unrealized gain (loss)

    (0.54      (0.84      0.28        0.40        (1.13
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net increase (decrease) from investment operations

    0.16        (0.09      1.08        1.20        (0.31
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Distributions to Common Shareholders from net investment income(b)

    (0.76      (0.80      (0.81      (0.81      (0.82
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net asset value, end of year

  $ 13.35      $ 13.95      $ 14.84      $ 14.57      $ 14.18  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Market price, end of year

  $ 12.40      $ 13.38      $ 14.31      $ 13.32      $ 12.88  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total Return Applicable to Common Shareholders(c)

             

Based on net asset value

    1.33      (0.47 )%       8.24      9.20      (1.07 )% 
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Based on market price

    (1.88 )%       (1.00 )%       14.09      9.91      (7.78 )% 
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Ratios to Average Net Assets Applicable to Common Shareholders

             

Total expenses

    2.30      1.95      1.60      1.59      1.75
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total expenses after fees waived and/or reimbursed and paid indirectly

    2.24      1.91      1.58      1.57      1.67
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total expenses after fees waived and/or reimbursed and/or paid indirectly and excluding interest expense, fees and amortization of offering costs(d)

    0.99      0.98      0.99      0.99      0.99
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income to Common Shareholders

    5.08      5.22      5.49      5.49      6.00
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Supplemental Data

             

Net assets applicable to Common Shareholders, end of year (000)

  $ 173,818      $ 181,614      $ 193,110      $ 189,594      $ 184,479  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

VMTP Shares outstanding at $100,000 liquidation value, end of year (000)

  $ 87,000      $ 87,000      $ 87,000      $ 87,000      $ 87,000  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Asset coverage per VMTP Shares at $100,000 liquidation value, end of year

  $ 299,791      $ 308,751      $ 321,966      $ 317,924      $ 312,045  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Borrowings outstanding, end of year (000)

  $ 26,238      $ 29,150      $ 24,429      $ 21,937      $ 25,187  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Portfolio turnover rate

    21      18      25      11      46
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

(a)  Based on average Common Shares outstanding.
(b) Distributions for annual periods determined in accordance with U.S. federal income tax regulations.
(c) Total returns based on market price, which can be significantly greater or less than the net asset value, may result in substantially different returns. Where applicable, excludes the effects of any sales charges and assumes the reinvestment of distributions at actual reinvestment prices.
(d) Interest expense, fees and amortization of offering costs related to TOB Trusts and/or VMTP Shares. See Note 4 and Note 10 of the Notes to Financial Statements for details.

See notes to financial statements.

 

 

86    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Financial Highlights  (continued)

(For a share outstanding throughout each period)

 

    MUI  
    Year Ended April 30,  
     2018      2017      2016      2015      2014  

Net asset value, beginning of year

  $ 15.17      $ 16.16      $ 15.86      $ 15.64      $ 16.60  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income(a)

    0.59        0.65        0.73        0.77        0.80  

Net realized and unrealized gain (loss)

    (0.23      (0.83      0.53        0.27        (0.85
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net increase (decrease) from investment operations

    0.36        (0.18      1.26        1.04        (0.05
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
Distributions to Common Shareholders(b)                                  

From net investment income

    (0.60      (0.67      (0.78      (0.82      (0.86

From net realized gain

    (0.00 )(c)       (0.14      (0.18             (0.05
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total distributions to Common Shareholders

    (0.60      (0.81      (0.96      (0.82      (0.91
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net asset value, end of year

  $ 14.93      $ 15.17      $ 16.16      $ 15.86      $ 15.64  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Market price, end of year

  $ 13.01      $ 13.96      $ 15.19      $ 14.47      $ 14.55  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total Return Applicable to Common Shareholders(d)

             

Based on net asset value

    2.76      (0.69 )%       9.04      7.27      0.50
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Based on market price

    (2.69 )%       (2.77 )%       12.27      5.20      (3.73 )% 
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Ratios to Average Net Assets Applicable to Common Shareholders

             

Total expenses

    2.17      1.90      1.57      1.52      1.65
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total expenses after fees waived and/or reimbursed and paid indirectly

    2.17      1.89      1.57      1.52      1.65
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total expenses after fees waived and/or reimbursed and paid indirectly and excluding interest expense, fees and amortization of offering costs(e)

    0.97      0.96      0.94      0.96      1.00
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income to Common Shareholders

    3.87      4.12      4.61      4.82      5.28
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Supplemental Data

             

Net assets applicable to Common Shareholders, end of year (000)

  $ 571,769      $ 580,945      $ 618,971      $ 607,440      $ 599,066  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

VMTP Shares outstanding at $100,000 liquidation value, end of year (000)

  $ 287,100      $ 287,100      $ 287,100      $ 287,100      $ 287,100  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Asset coverage per VMTP Shares at $100,000 liquidation value, end of year

  $ 299,153      $ 302,349      $ 315,594      $ 311,578      $ 308,661  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Borrowings outstanding, end of year (000)

  $ 79,136      $ 58,337      $ 63,102      $ 52,932      $ 69,070  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Portfolio turnover rate

    34      12      20      18      22
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

(a)  Based on average Common Shares outstanding.
(b)  Distributions for annual periods determined in accordance with U.S. federal income tax regulations.
(c)  Amount is greater than $(0.005) per share.
(d)  Total returns based on market price, which can be significantly greater or less than the net asset value, may result in substantially different returns. Where applicable, excludes the effects of any sales charges and assumes the reinvestment of distributions at actual reinvestment prices.
(e)  Interest expense, fees and amortization of offering costs related to TOB Trusts and/or VMTP Shares. See Note 4 and Note 10 of the Notes to Financial Statements for details.

See notes to financial statements.

 

 

FINANCIAL HIGHLIGHTS      87  


Financial Highlights  (continued)

(For a share outstanding throughout each period)

 

    MVT  
    Year Ended April 30,  
     2018      2017      2016      2015      2014  

Net asset value, beginning of year

  $ 15.19      $ 16.17      $ 16.01      $ 15.45      $ 16.69  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income(a)

    0.83        0.91        0.98        0.99        1.03  

Net realized and unrealized gain (loss)

    (0.41      (0.95      0.18        0.61        (1.19
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net increase (decrease) from investment operations

    0.42        (0.04      1.16        1.60        (0.16
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Distributions to Common Shareholders from net investment income(b)

    (0.86      (0.94      (1.00      (1.04      (1.08
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net asset value, end of year

  $ 14.75      $ 15.19      $ 16.17      $ 16.01      $ 15.45  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Market price, end of year

  $ 14.05      $ 15.45      $ 17.38      $ 16.26      $ 15.16  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total Return Applicable to Common Shareholders(c)

             

Based on net asset value

    2.79      (0.34 )%       7.61      10.65      (0.37 )% 
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Based on market price

    (3.74 )%       (5.68 )%       13.88      14.52      (5.74 )% 
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Ratios to Average Net Assets Applicable to Common Shareholders

             

Total expenses

    2.11      1.88      1.52      1.50      1.63
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total expenses after fees waived and/or reimbursed and paid indirectly

    2.11      1.87      1.52      1.50      1.63
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total expenses after fees waived and/or reimbursed and paid indirectly and excluding interest expense, fees and amortization of offering costs(d)

    0.91      0.92      0.92      0.92      0.96
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income to Common Shareholders

    5.44      5.78      6.15      6.17      6.93
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Supplemental Data

             

Net assets applicable to Common Shareholders, end of year (000)

  $ 314,261      $ 321,939      $ 340,753      $ 336,320      $ 324,146  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

VMTP Shares outstanding at $100,000 liquidation value, end of year (000)

  $ 140,000      $ 140,000      $ 140,000      $ 140,000      $ 140,000  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Asset coverage per VMTP Shares at $100,000 liquidation value, end of year

  $ 324,472      $ 329,956      $ 343,395      $ 340,229      $ 331,533  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Borrowings outstanding, end of year (000)

  $ 61,343      $ 60,575      $ 69,195      $ 66,439      $ 66,715  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Portfolio turnover rate

    11      9      6      10      17
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

(a)  Based on average Common Shares outstanding.
(b)  Distributions for annual periods determined in accordance with U.S. federal income tax regulations.
(c)  Total returns based on market price, which can be significantly greater or less than the net asset value, may result in substantially different returns. Where applicable, excludes the effects of any sales charges and assumes the reinvestment of distributions at actual reinvestment prices.
(d)  Interest expense, fees and amortization of offering costs related to TOB Trusts and/or VMTP Shares. See Note 4 and Note 10 of the Notes to Financial Statements for details.

See notes to financial statements.

 

 

88    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Notes to Financial Statements

 

1. ORGANIZATION

The following are registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as closed-end management investment companies and are referred to herein collectively as the “Funds”, or individually as a “Fund”:

 

Fund Name   Herein Referred To As    Organized    Diversification
Classification

BlackRock MuniAssets Fund, Inc.

  MUA    Maryland    Diversified

BlackRock MuniEnhanced Fund, Inc.

  MEN    Maryland    Diversified

BlackRock MuniHoldings Fund, Inc.

  MHD    Maryland    Diversified

BlackRock MuniHoldings Fund II, Inc.

  MUH    Maryland    Diversified

BlackRock MuniHoldings Quality Fund, Inc.

  MUS    Maryland    Diversified

BlackRock Muni Intermediate Duration Fund, Inc.

  MUI    Maryland    Diversified

BlackRock MuniVest Fund II, Inc.

  MVT    Maryland    Diversified

The Boards of Directors of the Funds are collectively referred to throughout this report as the “Board of Directors” or the “Board,” and the directors thereof are collectively referred to throughout this report as “Directors”. The Funds determine and make available for publication the net asset values (“NAVs”) of their Common Shares on a daily basis.

The Funds, together with certain other registered investment companies advised by BlackRock Advisors, LLC (the “Manager”) or its affiliates, are included in a complex of closed-end funds referred to as the Closed-End Complex.

 

2. SIGNIFICANT ACCOUNTING POLICIES

The financial statements are prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”), which may require management to make estimates and assumptions that affect the reported amounts of assets and liabilities in the financial statements, disclosure of contingent assets and liabilities at the date of 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. Each Fund is considered an investment company under U.S. GAAP and follows the accounting and reporting guidance applicable to investment companies. Below is a summary of significant accounting policies:

Investment Transactions and Income Recognition: For financial reporting purposes, investment transactions are recorded on the dates the transactions are entered into (the “trade dates”). Realized gains and losses on investment transactions are determined on the identified cost basis. Dividend income is recorded on the ex-dividend date. Interest income, including amortization and accretion of premiums and discounts on debt securities, is recognized on an accrual basis.

Segregation and Collateralization: In cases where a Fund enters into certain investments (e.g., futures contracts) or certain borrowings (e.g., TOB Trust transactions) that would be treated as “senior securities” for 1940 Act purposes, a Fund may segregate or designate on its books and records cash or liquid assets having a market value at least equal to the amount of its future obligations under such investments or borrowings. Doing so allows the investment or borrowing to be excluded from treatment as a “senior security.” Furthermore, if required by an exchange or counterparty agreement, the Funds may be required to deliver/deposit cash and/or securities to/with an exchange, or broker-dealer or custodian as collateral for certain investments or obligations.

Distributions: Distributions from net investment income are declared and paid monthly. Distributions of capital gains are recorded on the ex-dividend date and made at least annually. The character and timing of distributions are determined in accordance with U.S. federal income tax regulations, which may differ from U.S. GAAP.

Distributions to Preferred Shareholders are accrued and determined as described in Note 10.

Deferred Compensation Plan: Under the Deferred Compensation Plan (the “Plan”) approved by each Fund’s Board, the independent Directors (“Independent Directors”) may defer a portion of their annual complex-wide compensation. Deferred amounts earn an approximate return as though equivalent dollar amounts had been invested in common shares of certain other BlackRock Closed-End Funds selected by the Independent Directors. This has the same economic effect for the Independent Directors as if the Independent Directors had invested the deferred amounts directly in certain other BlackRock Closed-End Funds.

The Plan is not funded and obligations thereunder represent general unsecured claims against the general assets of each Fund, if applicable. Deferred compensation liabilities are included in the Directors’ and Officer’s fees payable in the Statements of Assets and Liabilities and will remain as a liability of the Funds until such amounts are distributed in accordance with the Plan.

Recent Accounting Standards: In November 2016, the Financial Accounting Standards Board issued Accounting Standards Update “Restricted Cash” which will require entities to include the total of cash, cash equivalents, restricted cash, and restricted cash equivalents in the beginning and ending cash balances in the Statements of Cash Flows. The guidance will be applied retrospectively and is effective for fiscal years beginning after December 15, 2017, and interim periods within those years. Management is evaluating the impact, if any, of this guidance on the Funds’ presentation in the Statements of Cash Flows.

In March 2017, the Financial Accounting Standards Board issued Accounting Standards Update “Premium Amortization of Purchased Callable Debt Securities” which amends the amortization period for certain purchased callable debt securities. Under the new guidance, the premium amortization of purchased callable debt securities that have explicit, non-contingent call features and are callable at fixed prices will be amortized to the earliest call date. The guidance will be applied on a modified retrospective basis and is effective for fiscal years, and their interim periods, beginning after December 15, 2018. Management is currently evaluating the impact of this guidance to the Funds.

 

 

NOTES TO FINANCIAL STATEMENTS      89  


Notes to Financial Statements  (continued)

 

Indemnifications: In the normal course of business, a Fund enters into contracts that contain a variety of representations that provide general indemnification. A Fund’s maximum exposure under these arrangements is unknown because it involves future potential claims against a Fund, which cannot be predicted with any certainty.

Other: Expenses directly related to a Fund are charged to that Fund. Other operating expenses shared by several funds, including other funds managed by the Manager, are prorated among those funds on the basis of relative net assets or other appropriate methods.

 

3. INVESTMENT VALUATION AND FAIR VALUE MEASUREMENTS

Investment Valuation Policies: The Funds’ investments are valued at fair value (also referred to as “market value” within the financial statements) as of the close of trading on the New York Stock Exchange (“NYSE”) (generally 4:00 p.m., Eastern time). U.S. GAAP defines fair value as the price the Funds would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. The Funds determine the fair values of their financial instruments using various independent dealers or pricing services under policies approved by the Board of Directors of each Fund (the “Board”). The BlackRock Global Valuation Methodologies Committee (the “Global Valuation Committee”) is the committee formed by management to develop global pricing policies and procedures and to oversee the pricing function for all financial instruments.

Fair Value Inputs and Methodologies: The following methods and inputs are used to establish the fair value of each Fund’s assets and liabilities:

 

    Municipal investments (including commitments to purchase such investments on a “when-issued” basis) are valued on the basis of prices provided by dealers or pricing services. In determining the value of a particular investment, pricing services may use certain information with respect to transactions in such investments, quotations from dealers, pricing matrixes, market transactions in comparable investments and information with respect to various relationships between investments.

 

    Investments in open-end U.S. mutual funds are valued at net asset value (“NAV”) each business day.

 

    Futures contracts traded on exchanges are valued at their last sale price.

If events (e.g., a company announcement, market volatility or a natural disaster) occur that are expected to materially affect the value of such investments, or in the event that the application of these methods of valuation results in a price for an investment that is deemed not to be representative of the market value of such investment, or if a price is not available, the investment will be valued by the Global Valuation Committee, or its delegate, in accordance with a policy approved by the Board as reflecting fair value (“Fair Valued Investments”). The fair valuation approaches that may be used by the Global Valuation Committee will include market approach, income approach and cost approach. Valuation techniques such as discounted cash flow, use of market comparables and matrix pricing are types of valuation approaches and are typically used in determining fair value. When determining the price for Fair Valued Investments, the Global Valuation Committee, or its delegate, seeks to determine the price that each Fund might reasonably expect to receive or pay from the current sale or purchase of that asset or liability in an arm’s-length transaction. Fair value determinations shall be based upon all available factors that the Global Valuation Committee, or its delegate, deems relevant and consistent with the principles of fair value measurement. The pricing of all Fair Valued Investments is subsequently reported to the Board or a committee thereof on a quarterly basis.

Fair Value Hierarchy: Various inputs are used in determining the fair value of investments and derivative financial instruments. These inputs to valuation techniques are categorized into a fair value hierarchy consisting of three broad levels for financial statement purposes as follows:

 

    Level 1 — Unadjusted price quotations in active markets/exchanges for identical assets or liabilities that each Fund has the ability to access

 

    Level 2 — Other observable inputs (including, but not limited to, quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs)

 

    Level 3 — Unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including each Fund’s own assumptions used in determining the fair value of investments and derivative financial instruments)

The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the fair value hierarchy classification is determined based on the lowest level input that is significant to the fair value measurement in its entirety. Investments classified within Level 3 have significant unobservable inputs used by the Global Valuation Committee in determining the price for Fair Valued Investments. Level 3 investments include equity or debt issued by privately held companies or funds. There may not be a secondary market, and/or there are a limited number of investors. Level 3 investments may also be adjusted to reflect illiquidity and/or non-transferability, with the amount of such discount estimated by the Global Valuation Committee in the absence of market information.

Changes in valuation techniques may result in transfers into or out of an assigned level within the hierarchy. In accordance with each Fund’s policy, transfers between different levels of the fair value hierarchy are deemed to have occurred as of the beginning of the reporting period. The categorization of a value determined for investments and derivative financial instruments is based on the pricing transparency of the investments and derivative financial instruments and is not necessarily an indication of the risks associated with investing in those securities.

 

 

90    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Notes to Financial Statements  (continued)

 

 

4. SECURITIES AND OTHER INVESTMENTS

Zero-Coupon Bonds: Zero-coupon bonds are normally issued at a significant discount from face value and do not provide for periodic interest payments. These bonds may experience greater volatility in market value than other debt obligations of similar maturity which provide for regular interest payments.

Forward Commitments and When-Issued Delayed Delivery Securities: Certain Funds may purchase securities on a when-issued basis and may purchase or sell securities on a forward commitment basis. Settlement of such transactions normally occurs within a month or more after the purchase or sale commitment is made. A Fund may purchase securities under such conditions with the intention of actually acquiring them, but may enter into a separate agreement to sell the securities before the settlement date. Since the value of securities purchased may fluctuate prior to settlement, a Fund may be required to pay more at settlement than the security is worth. In addition, a Fund is not entitled to any of the interest earned prior to settlement. When purchasing a security on a delayed delivery basis, a Fund assumes the rights and risks of ownership of the security, including the risk of price and yield fluctuations. In the event of default by the counterparty, a Fund’s maximum amount of loss is the unrealized appreciation of unsettled when-issued transactions.

Municipal Bonds Transferred to TOB Trusts: Certain Funds leverage their assets through the use of “TOB Trust” transactions. The Funds transfer municipal bonds into a special purpose trust (a “TOB Trust”). A TOB Trust issues two classes of beneficial interests: short-term floating rate interests (“TOB Trust Certificates”), which are sold to third party investors, and residual inverse floating rate interests (“TOB Residuals”), which are issued to the participating funds that contributed the municipal bonds to the TOB Trust. The TOB Trust Certificates have interest rates that reset weekly and their holders have the option to tender such certificates to the TOB Trust for redemption at par and any accrued interest at each reset date. The TOB Residuals held by a Fund provide the Fund with the right to cause the holders of a proportional share of the TOB Trust Certificates to tender their certificates to the TOB Trust at par plus accrued interest. The Funds may withdraw a corresponding share of the municipal bonds from the TOB Trust. Other funds managed by the investment adviser may also contribute municipal bonds to a TOB Trust into which a Fund has contributed bonds. If multiple BlackRock advised funds participate in the same TOB Trust, the economic rights and obligations under the TOB Residuals will be shared among the funds ratably in proportion to their participation in the TOB Trust.

TOB Trusts are supported by a liquidity facility provided by a third party bank or other financial institution (the “Liquidity Provider”) that allows the holders of the TOB Trust Certificates to tender their certificates in exchange for payment of par plus accrued interest on any business day. The tendered TOB Trust Certificates are remarketed by a Remarketing Agent. In the event of a failed remarketing, the TOB Trust may draw upon a loan from the Liquidity Provider to purchase the tendered TOB Trust Certificates. Any loans made by the Liquidity Provider will be secured by the purchased TOB Trust Certificates held by the TOB Trust and will be subject to an increased interest rate based on number of days the loan is outstanding.

The TOB Trust may be collapsed without the consent of a Fund, upon the occurrence of a termination event, as defined in the TOB Trust agreement. Upon the occurrence of a termination event, a TOB Trust would be liquidated with the proceeds applied first to any accrued fees owed to the trustee of the TOB Trust, the Remarketing Agent and the Liquidity Provider. Upon certain termination events, TOB Trust Certificates holders will be paid before the TOB Residuals holders (i.e., the Funds) whereas in other termination events, TOB Trust Certificates holders and TOB Residuals holders will be paid pro rata.

While a Fund’s investment policies and restrictions expressly permit investments in inverse floating rate securities, such as TOB Residuals, they restrict the ability of a Fund to borrow money for purposes of making investments. MUA, MEN and MVT management believes that a Fund’s restrictions on borrowings do not apply to the Funds’ TOB Trust transactions. Each Fund’s transfer of the municipal bonds to a TOB Trust is considered a secured borrowing for financial reporting purposes. The cash received by the TOB Trust from the sale of the TOB Trust Certificates, less certain transaction expenses, is paid to a Fund. A Fund typically invests the cash received in additional municipal bonds.

Accounting for TOB Trusts: The municipal bonds deposited into a TOB Trust are presented in a Fund’s Schedule of Investments and the TOB Trust Certificates are shown in Other Liabilities in the Statements of Assets and Liabilities. Any loans drawn by the TOB Trust pursuant to the liquidity facility to purchase tendered TOB Trust Certificates are shown as Loan for TOB Trust Certificates. The carrying amount of a Fund’s payable to the holder of the TOB Trust Certificates, as reported in the Statements of Assets and Liabilities as TOB Trust Certificates, approximates its fair value.

Interest income, including amortization and accretion of premiums and discounts, from the underlying municipal bonds is recorded by a Fund on an accrual basis. Interest expense incurred on the TOB Trust transaction and other expenses related to remarketing, administration, trustee, liquidity and other services to a TOB Trust are shown as interest expense, fees and amortization of offering costs in the Statements of Operations. Fees paid upon creation of the TOB Trust are recorded as debt issuance costs and are amortized to interest expense, fees and amortization of offering costs in the Statements of Operations to the expected maturity of the TOB Trust. In connection with the restructurings of the TOB Trusts to non-bank sponsored TOB Trusts, a Fund incurred non-recurring, legal and restructuring fees, which are recorded as interest expense, fees and amortization of deferred offering costs in the Statements of Operations. Amounts recorded within interest expense, fees and amortization of offering costs in the Statements of Operations are:

 

     Interest
Expense
     Liquidity
Fees
     Other
Expenses
     Total  

MUA

  $ 750,038      $ 291,961      $ 142,597      $ 1,184,596  

MEN

    836,040        324,878        108,472        1,269,390  

MHD

    678,812        277,761        103,482        1,060,055  

MUH

    528,537        215,868        78,769        823,174  

MUS

    316,369        125,496        43,241        485,106  

MUI

    764,131        330,900        87,816        1,182,847  

MVT

    645,430        255,650        108,070        1,009,150  

 

 

NOTES TO FINANCIAL STATEMENTS      91  


Notes to Financial Statements  (continued)

 

For the year ended April 30, 2018, the following table is a summary of each Fund’s TOB Trusts:

 

     Underlying
Municipal 
Bonds
Transferred to
TOB Trusts
 (a)
     Liability for
TOB Trust
Certificates
 (b)
     Range of
Interest Rates
on TOB Trust
Certificates at
Period End
     Average
TOB
 Trust
Certificates
Outstanding
     Daily Weighted
Average Rate
of Interest and
Other Expenses
on  TOB Trusts
 

MUA

  $ 124,389,704      $ 71,924,984        1.77% — 1.95    $ 67,817,025        1.74

MEN

    148,470,679        87,395,145        1.75 — 2.39        74,774,790        1.70  

MHD

    106,589,305        63,165,719        1.76 — 2.39        62,747,048        1.69  

MUH

    90,796,754        54,099,850        1.76 — 2.39        48,665,867        1.69  

MUS

    48,525,844        26,238,374        1.76 — 1.93        29,081,136        1.67  

MUI

    135,695,444        79,135,643        1.76 — 1.83        70,865,628        1.67  

MVT

    105,332,425        61,342,524        1.76 — 2.39        59,542,718        1.70  

 

  (a) The municipal bonds transferred to a TOB Trust are generally high grade municipal bonds. In certain cases, when municipal bonds transferred are lower grade municipal bonds, the TOB Trust transaction may include a credit enhancement feature that provides for the timely payment of principal and interest on the bonds to the TOB Trust by a credit enhancement provider in the event of default of the municipal bond. The TOB Trust would be responsible for the payment of the credit enhancement fee and the Funds, as TOB Residuals holders, would be responsible for reimbursement of any payments of principal and interest made by the credit enhancement provider. The maximum potential amounts owed by the Fund, for such reimbursements, as applicable, are included in the maximum potential amounts disclosed for recourse TOB Trusts.  
  (b)  TOB Trusts may be structured on a non-recourse or recourse basis. When a Fund invests in TOB Trusts on a non-recourse basis, the Liquidity Provider may be required to make a payment under the liquidity facility. In such an event, the Liquidity Provider will typically either (i) fund the full amount owed under the liquidity facility and be subsequently reimbursed from only the proceeds of the liquidation of all or a portion of the municipal bonds held in the TOB Trust or the remarketing of the TOB Trust Certificates, or (ii) liquidate all or a portion of the municipal bonds held in the TOB Trust and then fund the balance, if any, of the amount owed under the liquidity facility over the liquidation proceeds (the “Liquidation Shortfall”). If a Fund invests in a TOB Trust on a recourse basis, a Fund will usually enter into a reimbursement agreement with the Liquidity Provider where a Fund is required to reimburse the Liquidity Provider the amount of any Liquidation Shortfall. As a result, if a Fund invests in a recourse TOB Trust, a Fund will bear the risk of loss with respect to any Liquidation Shortfall. If multiple funds participate in any such TOB Trust, these losses will be shared ratably, including the maximum potential amounts owed by a Fund at April 30, 2018, in proportion to their participation in the TOB Trust. The recourse TOB Trusts are identified in the Schedules of Investments including the maximum potential amounts owed by a Fund at April 30, 2018.  

For the year ended April 30, 2018, the following table is a summary of each Fund’s Loan for TOB Trust Certificates:

 

     Loan
Outstanding
at Period End
     Range of
Interest Rates
on Loans at
Period End
     Average
Loans

Outstanding
     Daily Weighted
Average Rate
of 
Interest and
Other Expenses
on Loans
 

MUA

  $           $ 71,423        0.79

MEN

                  17,326        0.78  

MUS

                  21,000        0.78  

 

5. DERIVATIVE FINANCIAL INSTRUMENTS

The Funds engage in various portfolio investment strategies using derivative contracts both to increase the returns of the Funds and/or to manage their exposure to certain risks such as credit risk, equity risk, interest rate risk, foreign currency exchange rate risk, commodity price risk or other risks (e.g., inflation risk). Derivative financial instruments categorized by risk exposure are included in the Schedules of Investments. These contracts may be transacted on an exchange or over-the-counter (“OTC”).

Futures Contracts: Futures contracts are purchased or sold to gain exposure to, or manage exposure to, changes in interest rates (interest rate risk), changes in the value of equity securities (equity risk) or foreign currencies (foreign currency exchange rate risk).

Futures contracts are agreements between the Funds and a counterparty to buy or sell a specific quantity of an underlying instrument at a specified price and on a specified date. Depending on the terms of a contract, it is settled either through physical delivery of the underlying instrument on the settlement date or by payment of a cash amount on the settlement date. Upon entering into a futures contract, the Funds are required to deposit initial margin with the broker in the form of cash or securities in an amount that varies depending on a contract’s size and risk profile. The initial margin deposit must then be maintained at an established level over the life of the contract.

Securities deposited as initial margin are designated in the Schedules of Investments and cash deposited, if any, is shown as cash pledged for futures contracts in the Statements of Assets and Liabilities. Pursuant to the contract, the Funds agree to receive from or pay to the broker an amount of cash equal to the daily fluctuation in market value of the contract (“variation margin”). Variation margin is recorded as unrealized appreciation (depreciation) and, if any, shown as variation margin receivable (or payable) on futures contracts in the Statements of Assets and Liabilities. When the contract is closed, a realized gain or loss is recorded in the Statements of Operations equal to the difference between the notional amount of the contract at the time it was opened and the notional amount at the time it was closed. The use of futures contracts involves the risk of an imperfect correlation in the movements in the price of futures contracts and interest, foreign currency exchange rates or underlying assets.

 

 

92    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Notes to Financial Statements  (continued)

 

 

6. INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES

The PNC Financial Services Group, Inc. is the largest stockholder and an affiliate of BlackRock, Inc. (“BlackRock”) for 1940 Act purposes.

Investment Advisory: Each Fund entered into an Investment Advisory Agreement with the Manager, the Funds’ investment adviser, an indirect, wholly-owned subsidiary of BlackRock, to provide investment advisory and administration services. The Manager is responsible for the management of each Fund’s portfolio and provides the personnel, facilities, equipment and certain other services necessary to the operations of each Fund.

For such services, each Fund, except MUI, pays the Manager a monthly fee at an annual rate equal to the following percentages of the average daily value of each Fund’s net assets:

 

     MUA      MEN      MHD      MUH      MUS      MVT  

Investment advisory fees

    0.55      0.50      0.55      0.55      0.55      0.50

For such services, MUI pays the Manager a monthly fee of 0.55% of (i) the average daily value of MUI’s net assets and (ii) the proceeds of any outstanding debt securities and borrowings used for leverage.

For purposes of calculating these fees, “net assets” mean the total assets of a Fund minus the sum of its accrued liabilities (which does not include liabilities represented by TOB Trusts and the liquidation preference of any outstanding preferred shares). It is understood that the liquidation preference of any outstanding preferred stock (other than accumulated dividends) and TOB Trusts is not considered a liability in determining a Fund’s NAV.

Waivers: The Manager, for MUS, voluntarily agreed to waive its investment advisory fee on the proceeds of the Preferred Shares and TOB Trusts that exceed 35% of total assets minus the sum of its accrued liabilities (which does not include liabilities represented by TOB Trusts and the liquidation preference of any outstanding preferred shares). This amount is included in fees waived and/or reimbursed by the Manager in the Statements of Operations. For the year ended April 30, 2018, the waiver was $103,521.

The Manager voluntarily agreed to waive its investment advisory fees by the amount of investment advisory fees each Fund pays to the Manager indirectly through its investment in affiliated money market funds (the “affiliated money market fund waiver”). These amounts are included in fees waived by the Manager in the Statements of Operations. For the year ended April 30, 2018, the amounts waived were as follows:

 

     MUA      MEN      MHD      MUH      MUS      MUI      MVT  

Amounts waived

  $ 3,077      $ 3,333      $ 3,248      $ 2,330      $ 2,411      $ 7,259      $ 6,318  

The Manager contractually agreed to waive its investment advisory fee with respect to any portion of each Fund’s assets invested in affiliated equity and fixed-income mutual funds and affiliated exchange-traded funds that have a contractual management fee through June 30, 2019. The agreement can be renewed for annual periods thereafter, and may be terminated on 90 days’ notice, each subject to approval by a majority of the Funds’ Independent Directors. For the year ended April 30, 2018, there were no fees waived by the Manager.

Directors and Officers: Certain Directors and/or officers of the Funds are directors and/or officers of BlackRock or its affiliates. The Funds reimburse the Manager for a portion of the compensation paid to the Funds’ Chief Compliance Officer, which is included in Directors and Officer in the Statements of Operations.

Other Transactions: The Funds may purchase securities from, or sell securities to, an affiliated fund provided the affiliation is due solely to having a common investment adviser, common officers, or common trustees. For the year ended April 30, 2018, the purchase and sale transactions and any net realized gains (losses) with an affiliated fund in compliance with Rule 17a-7 under the 1940 Act were as follows:

 

     Purchases      Sales      Net Realized
Gain (Loss)
 

MUA

  $      $ 3,142,314      $ 10,296  

 

7. PURCHASES AND SALES

For the year ended April 30, 2018, purchases and sales of investments, excluding short-term securities, were as follows:

 

     MUA      MEN      MHD      MUH      MUS      MUI      MVT  

Purchases

  $ 90,566,684      $ 143,293,646      $ 43,621,628      $ 55,095,129      $ 65,346,054      $ 355,315,563      $ 63,621,557  

Sales

    84,296,413        116,447,957        36,504,171        43,888,553        61,776,155        320,454,620        57,710,695  

 

8. INCOME TAX INFORMATION

It is each Fund’s policy to comply with the requirements of the Internal Revenue Code of 1986, as amended, applicable to regulated investment companies, and to distribute substantially all of its taxable income to its shareholders. Therefore, no U.S. federal income tax provision is required.

Each Fund files U.S. federal and various state and local tax returns. No income tax returns are currently under examination. The statute of limitations on each Fund’s U.S. federal tax returns generally remains open for each of the four years ended April 30, 2018. The statutes of limitations on each Fund’s state and local tax returns may remain open for an additional year depending upon the jurisdiction.

 

 

NOTES TO FINANCIAL STATEMENTS      93  


Notes to Financial Statements  (continued)

 

Management has analyzed tax laws and regulations and their application to the Funds as of April 30, 2018, inclusive of the open tax return years, and does not believe that there are any uncertain tax positions that require recognition of a tax liability in the Funds’ financial statements.

U.S. GAAP requires that certain components of net assets be adjusted to reflect permanent differences between financial and tax reporting. These reclassifications have no effect on net assets or net asset values per share. As of period end, the following permanent differences attributable to amortization methods on fixed-income securities, non-deductible expenses, the reclassification of distributions, the expiration of capital loss carryforwards and the sale of bonds received from tender option bond trusts were reclassified to the following accounts:

 

     MUA     MEN     MHD     MUH     MUS     MUI     MVT  

Paid-in capital

  $ (396,366   $ (9,972   $     $     $ (6,614,798   $     $  

Undistributed net investment income

    (1,941     (39,943     (329,706     (244,639     (1,463     (1,255,284     (29,914

Accumulated net realized gain (loss)

    398,307       49,915       329,706       244,639       6,616,261       1,255,284       29,914  

The tax character of distributions paid was as follows:

 

      MUA      MEN      MHD      MUH      MUS      MUI      MVT  

Tax-exempt income(a)

                    

04/30/2018

   $ 24,283,507      $ 21,572,138      $ 14,704,730      $ 10,689,353      $ 11,690,466      $ 28,655,443      $ 21,067,211  

04/30/2017

   $ 24,851,475      $ 22,352,150      $ 15,176,378      $ 11,027,908      $ 11,833,288      $ 29,890,674      $ 22,113,439  

Ordinary income(b)

                    

04/30/2018

     120,268        170,131        92,030        67,698               67,384        59,503  

04/30/2017

     103,838        38,123        565        428        23        1,802,874        38,601  

Long-term capital gains(c)

                    

04/30/2018

                   139,787        60,571               70,580         

04/30/2017

                                        4,399,618         
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

                    

04/30/2018

   $ 24,403,775      $ 21,742,269      $ 14,936,547      $ 10,817,622      $ 11,690,466      $ 28,793,407      $ 21,126,714  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

04/30/2017

   $ 24,955,313      $ 22,390,273      $ 15,176,943      $ 11,028,336      $ 11,833,311      $ 36,093,166      $ 22,152,040  
    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

  (a) The Funds designate these amounts paid during the fiscal year ended April 30, 2018, as exempt-interest dividends.  
  (b) Ordinary income consists primarily of taxable income recognized from market discount and net short-term capital gains. Additionally, all ordinary income distributions are comprised of interest-related dividends and qualified short-term capital gain dividends for non-U.S. residents and are eligible for exemption from U.S. withholding tax for nonresident aliens and foreign corporations.  
  (c) The Funds designate these amounts paid during the fiscal year ended April 30, 2018 as 20% rate long-term capital gain dividends.  

As of period end the tax components of accumulated net earnings (losses) were as follows:

 

     MUA     MEN     MHD      MUH      MUS     MUI      MVT  

Undistributed tax-exempt income

  $ 166,220     $ 1,654,391     $ 299,968      $ 97,704      $ 901,078     $ 518,702      $ 271,469  

Undistributed ordinary income

    112,282       1,669       262,317        214,595        1,210       16,482        8,680  

Undistributed long-term capital gains

                119,156        158,882              1,680,224        102,229  

Capital loss carryforwards

    (4,542,227     (76,432                   (6,959,194             

Net unrealized gains (losses)(a)

    28,770,250       27,039,584       20,579,534        14,899,213        11,740,218       26,100,362        24,427,209  
 

 

 

   

 

 

   

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 
  $ 24,506,525     $ 28,619,212     $ 21,260,975      $ 15,370,394      $ 5,683,312     $ 28,315,770      $ 24,809,587  
 

 

 

   

 

 

   

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 

 

  (a) The difference between book-basis and tax-basis net unrealized gains (losses) was attributable primarily to the tax deferral of losses on wash sales and straddles, amortization and accretion methods of premiums and discounts on fixed income securities, the realization for tax purposes of unrealized gains/losses on certain futures contracts, the accrual of income on securities in default, the treatment of residual interests in TOB Trusts and the deferral of compensation to Directors.  

As of April 30, 2018, the Funds had capital loss carryforwards available to offset future realized capital gains through the indicated expiration dates as follows:

 

Expires April 30,   MUA      MEN      MUS  

No expiration date(a)

  $ 2,348,073      $      $ 6,959,194  

2019

    2,194,154        76,432         
 

 

 

    

 

 

    

 

 

 
  $ 4,542,227      $ 76,432      $ 6,959,194  
 

 

 

    

 

 

    

 

 

 

 

  (a) Must be utilized prior to losses subject to expiration.  

During the year ended April 30, 2018, the Funds listed below utilized the following amounts of their respective capital loss carryforward:

 

     MUA      MEN      MUS      MVT  

Amount utilized

  $ 4,142,751      $ 1,881,521      $ 473,246      $ 1,124,434  

 

 

94    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Notes to Financial Statements  (continued)

 

As of April 30, 2018, gross unrealized appreciation and depreciation for investments and derivatives based on cost for U.S. federal income tax purposes were as follows:

 

     MUA     MEN     MHD     MUH     MUS     MUI     MVT  

Tax cost

  $ 468,703,061     $ 458,840,449     $ 297,164,286     $ 212,976,711     $ 248,480,938     $ 820,614,933     $ 425,922,977  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Gross unrealized appreciation

  $ 36,527,996     $ 29,526,830     $ 21,849,981     $ 15,300,582     $ 12,605,188     $ 28,439,757     $ 26,005,161  

Gross unrealized depreciation

    (7,698,372     (2,410,221     (1,270,447     (401,369     (864,972     (2,027,015     (1,427,803
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net unrealized appreciation (depreciation)

  $ 28,829,624     $ 27,116,609     $ 20,579,534     $ 14,899,213     $ 11,740,216     $ 26,412,742     $ 24,577,358  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

The Tax Cuts and Jobs Act (the “Act”) was enacted on December 22, 2017. Certain provisions of the Act were effective upon enactment with the remainder becoming effective for tax years beginning after December 31, 2017. Although the Act does not amend any provisions directly related to the qualification or taxation of regulated investment companies (“RICs”), the Act does change the taxation of entities in which some RICs invest, the tax treatment of income derived from those entities and the taxation of RIC shareholders. While management does not anticipate significant impact to the Funds or to their shareholders, there is uncertainty in the application of certain provisions in the Act. Specifically, provisions in the Act may increase the amount of or accelerate the recognition of taxable income and may limit the deductibility of certain expenses by RICs. Until full clarity around these provisions is obtained, the impact on the Funds’ financial statements, if any, cannot be fully determined.

 

9. PRINCIPAL RISKS

Many municipalities insure repayment of their bonds, which may reduce the potential for loss due to credit risk. The market value of these bonds may fluctuate for other reasons, including market perception of the value of such insurance, and there is no guarantee that the insurer will meet its obligation.

Inventories of municipal bonds held by brokers and dealers may decrease, which would lessen their ability to make a market in these securities. Such a reduction in market making capacity could potentially decrease a Fund’s ability to buy or sell bonds. As a result, a Fund may sell a security at a lower price, sell other securities to raise cash, or give up an investment opportunity, any of which could have a negative impact on performance. If a Fund needed to sell large blocks of bonds, those sales could further reduce the bonds’ prices and impact performance.

In the normal course of business, certain Funds invest in securities or other instruments and may enter into certain transactions, and such activities subject each Fund to various risks, including among others, fluctuations in the market (market risk) or failure of an issuer to meet all of its obligations. The value of securities or other instruments may also be affected by various factors, including, without limitation: (i) the general economy; (ii) the overall market as well as local, regional or global political and/or social instability; (iii) regulation, taxation or international tax treaties between various countries; or (iv) currency, interest rate and price fluctuations.

Each Fund may be exposed to prepayment risk, which is the risk that borrowers may exercise their option to prepay principal earlier than scheduled during periods of declining interest rates, which would force each Fund to reinvest in lower yielding securities. Each Fund may also be exposed to reinvestment risk, which is the risk that income from each Fund’s portfolio will decline if each Fund invests the proceeds from matured, traded or called fixed-income securities at market interest rates that are below each Fund portfolio’s current earnings rate.

The Funds may hold a significant amount of bonds subject to calls by the issuers at defined dates and prices. When bonds are called by issuers and the Funds reinvest the proceeds received, such investments may be in securities with lower yields than the bonds originally held, and correspondingly, could adversely impact the yield and total return performance of a Fund.

A Fund structures and “sponsors” the TOB Trusts in which it holds TOB Residuals and has certain duties and responsibilities, which may give rise to certain additional risks including, but not limited to, compliance, securities law and operational risks.

Should short-term interest rates rise, the Funds’ investments in the TOB Trusts may adversely affect the Funds’ net investment income and dividends to shareholders. Also, fluctuations in the market value of municipal bonds deposited into the TOB Trust may adversely affect the Funds’ NAVs per share.

The SEC and various federal banking and housing agencies have adopted credit risk retention rules for securitizations (the “Risk Retention Rules”). The Risk Retention Rules would require the sponsor of a TOB Trust to retain at least 5% of the credit risk of the underlying assets supporting the TOB Trust’s municipal bonds. The Risk Retention Rules may adversely affect the Funds’ ability to engage in TOB Trust transactions or increase the costs of such transactions in certain circumstances.

TOB Trusts constitute an important component of the municipal bond market. Any modifications or changes to rules governing TOB Trusts may adversely impact the municipal market and the Funds, including through reduced demand for and liquidity of municipal bonds and increased financing costs for municipal issuers. The ultimate impact of any potential modifications on the TOB Trust market and the overall municipal market is not yet certain.

Counterparty Credit Risk: The Funds may be exposed to counterparty credit risk, or the risk that an entity may fail to or be unable to perform on its commitments related to unsettled or open transactions. The Funds manage counterparty credit risk by entering into transactions only with counterparties that the Manager believes have the financial resources to honor their obligations and by monitoring the financial stability of those counterparties. Financial assets, which potentially expose the Funds to market, issuer and counterparty credit risks, consist principally of financial instruments and receivables due from counterparties. The extent of the Funds’ exposure to market, issuer and counterparty credit risks with respect to these financial assets is approximately their value recorded in the Statements of Assets and Liabilities, less any collateral held by the Funds.

A derivative contract may suffer a mark-to-market loss if the value of the contract decreases due to an unfavorable change in the market rates or values of the underlying instrument. Losses can also occur if the counterparty does not perform under the contract.

With exchange-traded futures, there is less counterparty credit risk to the Funds since the exchange or clearinghouse, as counterparty to such instruments, guarantees against a possible default. The clearinghouse stands between the buyer and the seller of the contract; therefore, credit risk is limited to failure of the clearinghouse. While

 

 

NOTES TO FINANCIAL STATEMENTS      95  


Notes to Financial Statements  (continued)

 

offset rights may exist under applicable law, a Fund does not have a contractual right of offset against a clearing broker or clearinghouse in the event of a default (including the bankruptcy or insolvency). Additionally, credit risk exists in exchange-traded futures with respect to initial and variation margin that is held in a clearing broker’s customer accounts. While clearing brokers are required to segregate customer margin from their own assets, in the event that a clearing broker becomes insolvent or goes into bankruptcy and at that time there is a shortfall in the aggregate amount of margin held by the clearing broker for all its clients, typically the shortfall would be allocated on a pro rata basis across all the clearing broker’s customers, potentially resulting in losses to the Funds.

Concentration Risk: As of period end, MUS invested a significant portion of its assets in securities in the Transportation and County, City, Special District, School District sectors. MUI and MVT invested a significant portion of their assets in securities in the Transportation sector. Changes in economic conditions affecting such sectors would have a greater impact on the Funds and could affect the value, income and/or liquidity of positions in such securities.

The Funds invest a significant portion of their assets in fixed-income securities and/or use derivatives tied to the fixed-income markets. Changes in market interest rates or economic conditions may affect the value and/or liquidity of such investments. Interest rate risk is the risk that prices of bonds and other fixed-income securities will increase as interest rates fall and decrease as interest rates rise.

 

10. CAPITAL SHARE TRANSACTIONS

Each Fund is authorized to issue 200 million shares, all of which were initially classified as Common Shares. The par value for each Fund’s Common Shares is $0.10. The par value for each Fund’s Preferred Shares outstanding is $0.10. The Board is authorized, however, to reclassify any unissued shares to Preferred Shares without the approval of Common Shareholders.

Common Shares

For the years shown, shares issued and outstanding increased by the following amounts as a result of dividend reinvestment:

 

Year ended April 30,   MUA      MEN      MHD      MUH      MUS      MVT  

2018

    86,656        37,435        24,051        18,533        2,901        111,960  

2017

    83,132        52,845        25,957        17,531        5,658        114,327  

For the years ended April 30, 2018 and April 30, 2017, shares issued and outstanding remained constant for MUI.

Preferred Shares

Each Fund’s Preferred Shares rank prior to the Fund’s Common Shares as to the payment of dividends by the Fund and distribution of assets upon dissolution or liquidation of a Fund. The 1940 Act prohibits the declaration of any dividend on a Fund’s Common Shares or the repurchase of a Fund’s Common Shares if a Fund fails to maintain asset coverage of at least 200% of the liquidation preference of the Fund’s outstanding Preferred Shares. In addition, pursuant to the Preferred Shares’ governing instruments, a Fund is restricted from declaring and paying dividends on classes of shares ranking junior to or on parity with the Fund’s Preferred Shares or repurchasing such shares if a Fund fails to declare and pay dividends on the Preferred Shares, redeem any Preferred Shares required to be redeemed under the Preferred Shares’ governing instruments or comply with the basic maintenance amount requirement of the ratings agencies rating the Preferred Shares.

The holders of Preferred Shares have voting rights equal to the voting rights of the holders of Common Shares (one vote per share) and will vote together with holders of Common Shares (one vote per share) as a single class on certain matters. However, the holders of Preferred Shares, voting as a separate class, are also entitled to elect two Directors to the Board of each Fund. The holders of Preferred Shares are also entitled to elect the full Board of Directors if dividends on the Preferred Shares are not paid for a period of two years. The holders of Preferred Shares are also generally entitled to a separate class vote to amend the Preferred Share governing documents. In addition, the 1940 Act requires the approval of the holders of a majority of any outstanding Preferred Shares, voting as a separate class, to (a) adopt any plan of reorganization that would adversely affect the Preferred Shares, (b) change a Fund’s sub-classification as a closed-end investment company or change its fundamental investment restrictions or (c) change its business so as to cease to be an investment company.

VRDP Shares

MEN has issued Series W-7 VRDP Shares, $100,000 liquidation preference per share, in a privately negotiated offering. The VRDP Shares were offered to qualified institutional buyers as defined pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”). The VRDP Shares include a liquidity feature and are currently in a special rate period, as described below.

As of period end, the VRDP Shares outstanding of MEN were as follows:

 

     Issue
Date
     Shares
Issued
     Aggregate
Principal
     Maturity
Date
 

MEN

    05/19/11        1,425      $ 142,500,000        06/01/41  

Redemption Terms: MEN is required to redeem its VRDP Shares on the maturity date, unless earlier redeemed or repurchased. Six months prior to the maturity date, MEN is required to begin to segregate liquid assets with the Fund’s custodian to fund the redemption. In addition, MEN is required to redeem certain of its outstanding VRDP Shares if it fails to comply with certain asset coverage, basic maintenance amount or leverage requirements.

Subject to certain conditions, the VRDP Shares may also be redeemed, in whole or in part, at any time at the option of MEN. The redemption price per VRDP Share is equal to the liquidation preference per share plus any outstanding unpaid dividends.

 

 

96    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Notes to Financial Statements  (continued)

 

Liquidity Feature: MEN entered into a fee agreement with the liquidity provider that requires an initial commitment and a per annum liquidity fee payable to the liquidity provider. These fees, if applicable, are shown as liquidity fees in the Statements of Operations.

The fee agreement between MEN and the liquidity provider was scheduled to expire on July 6, 2017. MEN renewed the fee agreement for an additional 364 day term which is scheduled to expire on July 5, 2018 unless renewed or terminated in advance.

In the event the fee agreement is not renewed or is terminated in advance, and MEN does not enter into a fee agreement with an alternate liquidity provider, the VRDP Shares will be subject to mandatory purchase by the liquidity provider prior to the termination of the fee agreement. In the event of such mandatory purchase, MEN is required to redeem the VRDP Shares six months after the purchase date. Immediately after such mandatory purchase, MEN is required to begin to segregate liquid assets with its custodian to fund the redemption. There is no assurance MEN will replace such redeemed VRDP Shares with any other preferred shares or other form of leverage.

Remarketing: MEN may incur remarketing fees of 0.10% on the aggregate principal amount of all the Fund’s VRDP Shares, which, if any, are included in remarketing fees on Preferred Shares in the Statements of Operations. During any special rate period (as described below), MEN may incur no remarketing fees.

Dividends: Dividends on the VRDP Shares are payable monthly at a variable rate set weekly by the remarketing agent. Such dividend rates are generally based upon a spread over a base rate and cannot exceed a maximum rate. In the event of a failed remarketing, the dividend rate of the VRDP Shares will be reset to a maximum rate. The maximum rate is determined based on, among other things, the long-term preferred share rating assigned to the VRDP Shares and the length of time that the VRDP Shares fail to be remarketed. At the date of issuance, the VRDP Shares were assigned long-term ratings of Aaa from Moody’s and AAA from Fitch. Subsequent to the issuance of the VRDP Shares, Moody’s completed a review of its methodology for rating securities issued by registered closed-end funds. As of period end, the VRDP Shares were assigned a long-term rating of Aa1 from Moody’s under its new ratings methodology. The VRDP Shares continue to be assigned a long-term rating of AAA from Fitch.

For the year ended April 30, 2018, the annualized dividend rate for MEN’s VRDP Shares was 1.92%.

Special Rate Period:

On June 20, 2012, MEN commenced an approximate three-year term ending June 24, 2015 (the “special rate period”) with respect to its VRDP Shares, during which the VRDP Shares are not subject to any remarketing and the dividend rate is based on a predetermined methodology. The implementation of the special rate period resulted in a mandatory tender of the VRDP Shares prior to the commencement of the special rate period. The mandatory tender event was not result of a failed remarketing. The short-term ratings on the VRDP Shares for MEN were withdrawn by Moody’s, Fitch and/or S&P at the commencement of the special rate period. The special rate period has been subsequently extended and is currently set to expire on June 20, 2018. Prior to June 20, 2018, the holder of the VRDP Shares and MEN may mutually agree to extend the special rate period. If the special rate period is not extended, the VRDP Shares will revert to remarketable securities upon the termination of the special rate period and will be remarketed and available for purchase by qualified institutional investors.

During the special rate period, the liquidity and fee agreements remain in effect and the VRDP Shares remain subject to mandatory redemption by MEN on the maturity date. The VRDP Shares will not be remarketed or subject to optional or mandatory tender events during the special rate period. During the special rate period, MEN is required to comply with the same asset coverage, basic maintenance amount and leverage requirements for the VRDP Shares as is required when the VRDP Shares are not in a special rate period. MEN will not pay any fees to the liquidity provider and remarketing agent during the special rate period. MEN will also pay dividends monthly based on the sum of the Securities Industry and Financial Markets Association (“SIFMA”) Municipal Swap Index rate and a percentage per annum based on the long-term ratings assigned to the VRDP Shares.

If MEN redeems the VRDP Shares prior to end of the special rate period and the VRDP Shares have long-term ratings above A1/A+ and its equivalent by all ratings agencies then rating the VRDP Shares, then such redemption may be subject to a redemption premium payable to the holder of the VRDP Shares based on the time remaining in the special rate period, subject to certain exceptions for redemptions that are required to comply with minimum asset coverage requirements.

For the year ended April 30, 2018, VRDP Shares issued and outstanding of MEN remained constant.

VMTP Shares

MHD, MUH, MUS, MUI and MVT (collectively, the “VMTP Funds”) have each issued Series W-7 VMTP Shares, $100,000 liquidation preference per share, in privately negotiated offerings and sales of VMTP Shares exempt from registration under the Securities Act. The VMTP Shares are subject to certain restrictions on transfer, and VMTP Funds may also be required to register the VMTP Shares for sale under the Securities Act under certain circumstances. In addition, amendments to the VMTP governing documents generally require the consent of the holders of VMTP Shares.

As of period end, the VMTP Shares outstanding of each Fund were as follows:

 

    

Issue

Date

     Shares
Issued
     Aggregate
Principal
     Term
Redemption
Date
 

MHD

    12/16/11        837      $ 83,700,000        01/02/19  

MUH

    12/16/11        550        55,000,000        01/02/19  

MUS

    12/16/11        870        87,000,000        01/02/19  

MUI

    12/07/12        2,871        287,100,000        01/02/19  

MVT

    12/16/11        1,400        140,000,000        01/02/19  

 

 

NOTES TO FINANCIAL STATEMENTS      97  


Notes to Financial Statements  (continued)

 

Redemption Terms: Each VMTP Fund is required to redeem its VMTP Shares on the term redemption date, unless earlier redeemed or repurchased or unless extended. In June 2015, the term redemption dates for MHD, MUH, MUS, MUI and MVT were extended until January 2, 2019. There is no assurance that the term of a Fund’s VMTP Shares will be extended further or that a Fund’s VMTP Shares will be replaced with any other preferred shares or other form of leverage upon the redemption or repurchase of the VMTP Shares. Six months prior to the term redemption date, each VMTP Fund is required to begin to segregate liquid assets with each Funds’ custodian to fund the redemption. In addition, each VMTP Fund is required to redeem certain of its outstanding VMTP Shares if it fails to comply with certain asset coverage, basic maintenance amount or leverage requirements.

Subject to certain conditions, a Fund’s VMTP Shares may be redeemed, in whole or in part, at any time at the option of the Fund. The redemption price per VMTP Share is equal to the liquidation preference per share plus any outstanding unpaid dividends and applicable redemption premium. If a Fund redeems the VMTP Shares prior to the term redemption date and the VMTP Shares have long-term ratings above A1/A+ or its equivalent by the ratings agencies then rating the VMTP Shares, then such redemption may be subject to a prescribed redemption premium (up to 3% of the liquidation preference) payable to the holder of the VMTP Shares based on the time remaining until the term redemption date, subject to certain exceptions for redemptions that are required to comply with minimum asset coverage requirements.

Dividends: Dividends on the VMTP Shares are declared daily and payable monthly at a variable rate set weekly at a fixed rate spread to SIFMA Municipal Swap Index. The fixed spread is determined based on the long-term preferred share rating assigned to the VMTP Shares by the ratings agencies then rating the VMTP Shares. At the date of issuance, the VMTP Shares were assigned long-term ratings of Aaa from Moody’s and AAA from Fitch. Subsequent to the issuance of the VMTP Shares, Moody’s completed a review of its methodology for rating securities issued by registered closed-end funds. As of period end, the VMTP Shares were assigned a long-term rating of Aa1 from Moody’s under its new rating methodology. The VMTP Shares continue to be assigned a long-term rating of AAA from Fitch. The dividend rate on the VMTP Shares is subject to a step-up spread if the Funds fail to comply with certain provisions, including, among other things, the timely payment of dividends, redemptions or gross-up payments, and complying with certain asset coverage and leverage requirements.

For the year ended April 30, 2018, the average annualized dividend rates for the VMTP Shares were as follows:

 

     MHD      MUH      MUS      MUI      MVT  

Rate

    2.05      2.04      2.04      2.04      2.04

For the year ended April 30, 2018, VMTP Shares issued and outstanding of each Fund remained constant.

Offering Costs: The Funds incurred costs in connection with the issuance of VRDP and VMTP Shares, which were recorded as a direct deduction from the carrying value of the related debt liability and will be amortized over the life of the VRDP and VMTP Shares with the exception of upfront fees paid to the liquidity provider which were amortized over the life of the liquidity agreement. Amortization of these costs is included in interest expense, fees and amortization of offering costs in the Statements of Operations.

MUI’s offering costs that were recorded as a deferred charge and amortized over the 30-year life of MUI’s VRDP Shares were accelerated and charged to expense immediately upon redemption of MUI’s VRDP Shares. Costs incurred in connection with the issuance of MUI’s VMTP Shares were recorded as a deferred charge and will be amortized over the life of the VMTP Shares.

Financial Reporting: The VRDP and VMTP Shares are considered debt of the issuer; therefore, the liquidation preference, which approximates fair value of the VRDP and VMTP Shares, is recorded as a liability in the Statements of Assets and Liabilities net of deferred offering costs. Unpaid dividends are included in interest expense and fees payable in the Statements of Assets and Liabilities, and the dividends accrued and paid on the VRDP and VMTP Shares are included as a component of interest expense, fees and amortization of offering costs in the Statements of Operations. The VRDP and VMTP Shares are treated as equity for tax purposes. Dividends paid to holders of the VRDP and VMTP Shares are generally classified as tax-exempt income for tax-reporting purposes. Dividends and amortization of deferred offering costs on VRDP and VMTP Shares are included in interest expense, fees and amortization of offering costs in the Statements of Operations:

 

     Dividends Accrued      Deferred Offering
Costs Amortization
 

MUA

  $      $  

MEN

    2,735,735        9,971  

MHD

    1,712,484         

MUH

    1,124,062         

MUS

    1,771,082         

MUI

    5,853,025         

MVT

    2,852,951         

 

 

98    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Notes to Financial Statements  (continued)

 

 

11. SUBSEQUENT EVENTS

Management’s evaluation of the impact of all subsequent events on the Funds’ financial statements was completed through the date the financial statements were issued and the following items were noted:

 

     Common Dividend
Per Share
           Preferred Shares (c)  
     Paid (a)      Declared (b)            Shares      Series      Declared  

MUA

  $ 0.0545      $ 0.0545                     $  

MEN

    0.0480        0.0480         VRDP        W-7        279,476  

MHD

    0.0700        0.0700         VMTP        W-7        173,041  

MUH

    0.0675        0.0675         VMTP        W-7        113,707  

MUS

    0.0635        0.0635         VMTP        W-7        179,864  

MUI

    0.0445        0.0445         VMTP        W-7        593,550  

MVT

    0.0635        0.0635               VMTP        W-7        289,436  

 

  (a)  Net investment income dividend paid on June 1, 2018 to Common Shareholders of record on May 15, 2018.  
  (b)  Net investment income dividend declared on June 1, 2018, payable to Common Shareholders of record on June 15, 2018.  
  (c)  Dividends declared for period May 1, 2018 to May 30, 2018.  

 

 

NOTES TO FINANCIAL STATEMENTS      99  


Report of Independent Registered Public Accounting Firm

 

To the Shareholders and Board of Directors of BlackRock MuniAssets Fund, Inc., BlackRock MuniEnhanced Fund, Inc., BlackRock MuniHoldings Fund, Inc., BlackRock MuniHoldings Fund II, Inc., BlackRock MuniHoldings Quality Fund, Inc., BlackRock Muni Intermediate Duration Fund, Inc., and BlackRock MuniVest Fund II, Inc.:

Opinion on the Financial Statements and Financial Highlights

We have audited the accompanying statements of assets and liabilities of BlackRock MuniAssets Fund, Inc., BlackRock MuniEnhanced Fund, Inc., BlackRock MuniHoldings Fund, Inc., BlackRock MuniHoldings Fund II, Inc., BlackRock MuniHoldings Quality Fund, Inc., BlackRock Muni Intermediate Duration Fund, Inc., and BlackRock MuniVest Fund II, Inc. (the “Funds”), including the schedules of investments, as of April 30, 2018, the related statements of operations and cash flows for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each of the five years in the period then ended, and the related notes. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of the Funds as of April 30, 2018, and the results of their operations and cash flows for the year then ended, the changes in their net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements and financial highlights are the responsibility of the Funds’ management. Our responsibility is to express an opinion on the Funds’ financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Funds in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement, whether due to error or fraud. The Funds are not required to have, nor were we engaged to perform, an audit of their internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Funds’ internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as of April 30, 2018, by correspondence with the custodian and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.

Deloitte & Touche LLP

Boston, Massachusetts

June 20, 2018

We have served as the auditor of one or more BlackRock investment companies since 1992.

 

 

100    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Automatic Dividend Reinvestment Plan

 

Pursuant to each Fund’s Dividend Reinvestment Plan (the “Reinvestment Plan”), Common Shareholders are automatically enrolled to have all distributions of dividends and capital gains and other distributions reinvested by Computershare Trust Company, N.A. (the “Reinvestment Plan Agent”) in the respective Fund’s Common Shares pursuant to the Reinvestment Plan. Shareholders who do not participate in the Reinvestment Plan will receive all distributions in cash paid by check and mailed directly to the shareholders of record (or if the shares are held in street name or other nominee name, then to the nominee) by the Reinvestment Plan Agent, which serves as agent for the shareholders in administering the Reinvestment Plan.

After MUA, MEN, MHD, MUH, MUS, MUI and MVT declare a dividend or determine to make a capital gain or other distribution, the Reinvestment Plan Agent will acquire shares for the participants’ accounts, depending upon the following circumstances, either (i) through receipt of unissued but authorized shares from the Funds (“newly issued shares”) or (ii) by purchase of outstanding shares on the open market or on the Fund’s primary exchange (“open-market purchases”). If, on the dividend payment date, the net asset value per share (“NAV”) is equal to or less than the market price per share plus estimated brokerage commissions (such condition often referred to as a “market premium”), the Reinvestment Plan Agent will invest the dividend amount in newly issued shares acquired on behalf of the participants. The number of newly issued shares to be credited to each participant’s account will be determined by dividing the dollar amount of the dividend by the NAV on the date the shares are issued. However, if the NAV is less than 95% of the market price on the dividend payment date, the dollar amount of the dividend will be divided by 95% of the market price on the dividend payment date. If, on the dividend payment date, the NAV is greater than the market price per share plus estimated brokerage commissions (such condition often referred to as a “market discount”), the Reinvestment Plan Agent will invest the dividend amount in shares acquired on behalf of the participants in open-market purchases. If the Reinvestment Plan Agent is unable to invest the full dividend amount in open-market purchases, or if the market discount shifts to a market premium during the purchase period, the Reinvestment Plan Agent will invest any un-invested portion in newly issued shares. Investments in newly issued shares made in this manner would be made pursuant to the same process described above and the date of issue for such newly issued shares will substitute for the dividend payment date.

You may elect not to participate in the Reinvestment Plan and to receive all dividends in cash by contacting the Reinvestment Plan Agent, at the address set forth below.

Participation in the Reinvestment Plan is completely voluntary and may be terminated or resumed at any time without penalty by notice if received and processed by the Reinvestment Plan Agent prior to the dividend record date. Additionally, the Reinvestment Plan Agent seeks to process notices received after the record date but prior to the payable date and such notices often will become effective by the payable date. Where late notices are not processed by the applicable payable date, such termination or resumption will be effective with respect to any subsequently declared dividend or other distribution.

The Reinvestment Plan Agent’s fees for the handling of the reinvestment of distributions will be paid by each Fund. However, each participant will pay a pro rata share of brokerage commissions incurred with respect to the Reinvestment Plan Agent’s open-market purchases in connection with the reinvestment of all distributions. The automatic reinvestment of all distributions will not relieve participants of any U.S. federal, state or local income tax that may be payable on such dividends or distributions.

Each Fund reserves the right to amend or terminate the Reinvestment Plan. There is no direct service charge to participants in the Reinvestment Plan; however, each Fund reserves the right to amend the Reinvestment Plan to include a service charge payable by the participants. Participants in MEN and MUI that request a sale of shares are subject to a $2.50 sales fee and a $0.15 per share fee. Per share fees include any applicable brokerage commissions the Reinvestment Plan Agent is required to pay. Participants in MUA, MHD, MUH, MUS and MVT that request a sale of shares are subject to a $0.02 per share sold brokerage commission. All correspondence concerning the Reinvestment Plan should be directed to Computershare Trust Company, N.A. through the internet at http://www.computershare.com/blackrock, or in writing to Computershare, P.O. Box 505000, Louisville, KY 40233, Telephone: (800) 699-1236. Overnight correspondence should be directed to the Reinvestment Plan Agent at Computershare, 462 South 4th Street, Suite 1600, Louisville, KY 40202.

 

 

AUTOMATIC DIVIDEND REINVESTMENT PLAN      101  


Director and Officer Information

 

Independent Directors (a)
         

Name

Year of Birth (b)

  

Position(s) Held

(Length of Service) (c)

   Principal Occupation(s) During Past Five Years   

Number of BlackRock-Advised

Registered Investment
Companies
(“RICs”) Consisting of
Investment Portfolios
(“Portfolios”) Overseen (d)

  

Public Company and
Other Investment Company

Directorships During

Past Five Years

Richard E. Cavanagh

1946

  

Chair of the Board and Director

(Since 2007)

   Director, The Guardian Life Insurance Company of America since 1998; Board Chair, Volunteers of America (a not-for-profit organization) since 2015 (board member since 2009); Director, Arch Chemical (chemical and allied products) from 1999 to 2011; Trustee, Educational Testing Service from 1997 to 2009 and Chairman thereof from 2005 to 2009; Senior Advisor, The Fremont Group since 2008 and Director thereof since 1996; Faculty Member/Adjunct Lecturer, Harvard University since 2007; President and Chief Executive Officer, The Conference Board, Inc. (global business research organization) from 1995 to 2007.    75 RICs consisting of 75 Portfolios    None

Karen P. Robards

1950

  

Vice Chair of the Board and Director

(Since 2007)

   Principal of Robards & Company, LLC (consulting and private investing) since 1987; Co-founder and Director of the Cooke Center for Learning and Development (a not-for-profit organization) since 1987; Investment Banker at Morgan Stanley from 1976 to 1987.    75 RICs consisting of 75 Portfolios    Greenhill & Co., Inc.; AtriCure, Inc. (medical devices) from 2000 until 2017

Michael J. Castellano

1946

  

Director

(Since 2011)

   Chief Financial Officer of Lazard Group LLC from 2001 to 2011; Chief Financial Officer of Lazard Ltd from 2004 to 2011; Director, Support Our Aging Religious (non-profit) from 2009 to June 2015 and since 2017; Director, National Advisory Board of Church Management at Villanova University since 2010; Trustee, Domestic Church Media Foundation since 2012; Director, CircleBlack Inc. (financial technology company) since 2015.    75 RICs consisting of 75 Portfolios    None

Cynthia L. Egan

1955

  

Director

(Since 2016)

   Advisor, U.S. Department of the Treasury from 2014 to 2015; President, Retirement Plan Services for T. Rowe Price Group, Inc. from 2007 to 2012; executive positions within Fidelity Investments from 1989 to 2007.    75 RICs consisting of 75 Portfolios    Unum (insurance); The Hanover Insurance Group (insurance); Envestnet (investment platform) from 2013 until 2016

Frank J. Fabozzi

1948

  

Director

(Since 2007)

   Editor of and Consultant for The Journal of Portfolio Management since 2006; Professor of Finance, EDHEC Business School since 2011; Visiting Professor, Princeton University from 2013 to 2014 and since 2016; Professor in the Practice of Finance and Becton Fellow, Yale University School of Management from 2006 to 2011.    75 RICs consisting of 75 Portfolios    None

R. Glenn Hubbard

1958

  

Director

(Since 2007)

   Dean, Columbia Business School since 2004; Faculty member, Columbia Business School since 1988.    75 RICs consisting of 75 Portfolios    ADP (data and information services); Metropolitan Life Insurance Company (insurance)

W. Carl Kester

1951

  

Director

(Since 2007)

   George Fisher Baker Jr. Professor of Business Administration, Harvard Business School since 2008, Deputy Dean for Academic Affairs from 2006 to 2010, Chairman of the Finance Unit, from 2005 to 2006, Senior Associate Dean and Chairman of the MBA Program from 1999 to 2005; Member of the faculty of Harvard Business School since 1981.    75 RICs consisting of 75 Portfolios    None

Catherine A. Lynch

1961

  

Director

(Since 2016)

   Chief Executive Officer, Chief Investment Officer and various other positions, National Railroad Retirement Investment Trust from 2003 to 2016; Associate Vice President for Treasury Management, The George Washington University from 1999 to 2003; Assistant Treasurer, Episcopal Church of America from 1995 to 1999.    75 RICs consisting of 75 Portfolios    None

 

 

102    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Director and Officer Information  (continued)

 

 

Interested Directors (a)(e)

         

Name

Year of Birth (b)

  

Position(s) Held

(Length of Service) (c)

   Principal Occupation(s) During Past Five Years   

Number of BlackRock-Advised

Registered Investment
Companies

(“RICs”) Consisting of
Investment Portfolios
(“Portfolios”) Overseen (d)

  

Public Company and
Other Investment Company

Directorships During

Past Five Years

Robert Fairbairn

1965

  

Director

(Since 2018)

   Senior Managing Director of BlackRock, Inc. since 2010; oversees BlackRock’s Strategic Partner Program and Strategic Product Management Group; Member of BlackRock’s Global Executive and Global Operating Committees; Co-Chair of BlackRock’s Human Capital Committee; Global Head of BlackRock’s Retail and iShares® businesses from 2012 to 2016; Head of BlackRock’s Global Client Group from 2009 to 2012; Chairman of BlackRock’s international businesses from 2007 to 2010.    128 RICs consisting of 311 Portfolios    None

John M. Perlowski

1964

  

Director

(Since 2015);

President and Chief Executive Officer

(Since 2010)

   Managing Director of BlackRock, Inc. since 2009; Head of BlackRock Global Accounting and Product Services since 2009; Managing Director and Chief Operating Officer of the Global Product Group at Goldman Sachs Asset Management, L.P. from 2003 to 2009; Treasurer of Goldman Sachs Mutual Funds from 2003 to 2009 and Senior Vice President thereof from 2007 to 2009; Director of Goldman Sachs Offshore Funds from 2002 to 2009; Advisory Director of Family Resource Network (charitable foundation) since 2009.    128 RICs consisting of 311 Portfolios    None

(a) The address of each Director is c/o BlackRock, Inc., 55 East 52nd Street, New York, NY 10055.

(b) Each Independent Director will serve until his or her successor is elected and qualifies, or until his or her earlier death, resignation, retirement or removal, or until December 31 of the year in which he or she turns 75. The maximum age limitation may be waived as to any Director by action of a majority of the Directors upon finding of good cause therefor.

(c) Following the combination of Merrill Lynch Investment Managers, L.P. (“MLIM”) and BlackRock, Inc. (“BlackRock”) in September 2006, the various legacy MLIM and legacy BlackRock fund boards were realigned and consolidated into three new fund boards in 2007. As a result, although the chart shows certain Independent Directors as joining the Board in 2007, each Director first became a member of the boards of other legacy MLIM or legacy BlackRock funds as follows: Richard E. Cavanagh, 1994; Frank J. Fabozzi, 1988; R. Glenn Hubbard, 2004; W. Carl Kester, 1995 and Karen P. Robards, 1998.

(d) For purposes of this chart, “RICs” refers to investment companies registered under the 1940 Act and “Portfolios” refers to the investment programs of the BlackRock-advised funds. The Closed-End Complex is comprised of 75 RICs consisting of 75 portfolios. Mr. Fairbairn and Mr. Perlowski are also a board members of the BlackRock Equity-Bond Complex and the BlackRock Equity-Liquidity Complex.

(e) Mr. Fairbairn and Mr. Perlowski are both “interested persons,” as defined in the 1940 Act, of the Funds based on their positions with BlackRock and its affiliates. Mr. Fairbairn and Mr. Perlowski are also board members of the BlackRock Equity-Bond Complex and the BlackRock Equity-Liquidity Complex. Interested Directors serve until their resignation, removal or death, or until December 31 of the year in which they turn 72. The maximum age limitation may be waived as to any Director by action of a majority of the Directors upon a finding of good cause therefor.

 

 

DIRECTOR AND OFFICER INFORMATION      103  


Director and Officer Information  (continued)

 

Officers Who Are Not Directors (a)
     

Name

Year of Birth (b)

  

Position(s) Held

(Length of Service)

   Principal Occupation(s) During Past Five Years

Jonathan Diorio

1980

  

Vice President

(Since 2015)

   Managing Director of BlackRock, Inc. since 2015; Director of BlackRock, Inc. from 2011 to 2015; Director of Deutsche Asset & Wealth Management from 2009 to 2011.

Neal J. Andrews

1966

  

Chief Financial Officer

(Since 2007)

   Managing Director of BlackRock, Inc. since 2006; Senior Vice President and Line of Business Head of Fund Accounting and Administration at PNC Global Investment Servicing (U.S.) Inc. from 1992 to 2006.

Jay M. Fife

1970

  

Treasurer

(Since 2007)

   Managing Director of BlackRock, Inc. since 2007; Director of BlackRock, Inc. in 2006; Assistant Treasurer of the MLIM and Fund Asset Management, L.P. advised funds from 2005 to 2006; Director of MLIM Fund Services Group from 2001 to 2006.

Charles Park

1967

  

Chief Compliance Officer

(Since 2014)

   Anti-Money Laundering Compliance Officer for the BlackRock-advised Funds in the Equity-Bond Complex, the Equity-Liquidity Complex and the Closed-End Complex from 2014 to 2015; Chief Compliance Officer of BlackRock Advisors, LLC and the BlackRock-advised Funds in the Equity-Bond Complex, the Equity-Liquidity Complex and the Closed-End Complex since 2014; Principal of and Chief Compliance Officer for iShares® Delaware Trust Sponsor LLC since 2012 and BlackRock Fund Advisors (“BFA”) since 2006; Chief Compliance Officer for the BFA-advised iShares® exchange traded funds since 2006; Chief Compliance Officer for BlackRock Asset Management International Inc. since 2012.

Janey Ahn

1975

  

Secretary

(Since 2012)

   Managing Director of BlackRock, Inc. since 2018; Director of BlackRock, Inc. from 2009 to 2017; Assistant Secretary of the funds in the Closed-End Complex from 2008 to 2012.

(a) The address of each Officer is c/o BlackRock, Inc., 55 East 52nd Street, New York, NY 10055.

(b) Officers of the Funds serve at the pleasure of the Board.

 

Effective December 31, 2017, Jerrold B. Harris retired as a Director of the Funds.

Effective February 16, 2018, Barbara G. Novick resigned, and Robert Fairbairn was appointed, as an interested Director of the Funds.

As of the date of this report, the portfolio managers of MUH are Ted Jaeckel, Walter O’Connor and Christian Romaglino. Mr. Romaglino joined MUH’s portfolio management team effective February 1, 2018. Mr. Romaglino has been a Director of BlackRock, Inc. since 2017; a Portfolio Manager for the Municipal Mutual Fund Desk within BlackRock’s Global Fixed Income Group since 2017; and a Portfolio Manager at Brown Brothers Harriman from 2007 to 2017.

 

Investment Adviser

BlackRock Advisors, LLC

Wilmington, DE 19809

Transfer Agent

Computershare Trust Company, N.A.

Canton, MA 02021

VRDP Tender and Paying Agent and VMTP Redemption and Paying Agent

The Bank of New York Mellon

New York, NY 10289

VRDP Remarketing Agent

Citigroup Global Markets Inc.(a)

New York, NY 10179

 

VRDP Liquidity Provider

Citibank, N.A.(a)

New York, NY 10179

Accounting Agent and Custodian

State Street Bank and Trust Company

Boston, MA 02111

 

Independent Registered
Public Accounting Firm

Deloitte & Touche LLP

Boston, MA 02116

 

Legal Counsel

Skadden, Arps, Slate, Meagher & Flom LLP

Boston, MA 02116

 

Address of the Funds

100 Bellevue Parkway

Wilmington, DE 19809

 

 

(a)  For MEN.

 

 

104    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Additional Information

 

Fund Certification

Certain Funds are listed for trading on the NYSE and have filed with the NYSE their annual chief executive officer certification regarding compliance with the NYSE’s listing standards. The Funds filed with the SEC the certification of its chief executive officer and chief financial officer required by section 302 of the Sarbanes-Oxley Act.

Dividend Policy

Each 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 stable level of distributions, the Funds 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 particular month pay out such accumulated but undistributed income in addition to net investment income earned in that month. As a result, the distributions paid by the Funds for any particular month may be more or less than the amount of net investment income earned by the Funds during such month. The Funds’ current accumulated but undistributed net investment income, if any, is disclosed in the Statements of Assets and Liabilities, which comprises part of the financial information included in this report.

General Information

The Funds do not make available copies of their Statements of Additional Information because the Funds’ shares are not continuously offered, which means that the Statement of Additional Information of each Fund has not been updated after completion of the respective Fund’s offerings and the information contained in each Fund’s Statement of Additional Information may have become outdated.

During the period, there were no material changes in the Funds’ investment objectives or policies or to the Funds’ charters or by-laws that would delay or prevent a change of control of the Funds that were not approved by the shareholders or in the principal risk factors associated with investment in the Funds. Except as disclosed on page 104, there have been no changes in the persons who are primarily responsible for the day-to-day management of the Funds’ portfolios.

Quarterly performance, semi-annual and annual reports, current net asset value and other information regarding the Funds may be found on BlackRock’s website, which can be accessed at http://www.blackrock.com. Any reference to BlackRock’s website in this report is intended to allow investors public access to information regarding the Funds and does not, and is not intended to, incorporate BlackRock’s website in this report.

Electronic Delivery

Shareholders can sign up for e-mail notifications of quarterly statements, annual and semi-annual shareholder reports by enrolling in the electronic delivery program. Electronic copies of shareholder reports are available on BlackRock’s website.

To enroll in electronic delivery:

Shareholders Who Hold Accounts with Investment Advisers, Banks or Brokerages:

Please contact your financial advisor. Please note that not all investment advisers, banks or brokerages may offer this service.

Householding

The Funds will mail only one copy of shareholder documents, annual and semi-annual reports and proxy statements, to shareholders with multiple accounts at the same address. This practice is commonly called “householding” and is intended to reduce expenses and eliminate duplicate mailings of shareholder documents. Mailings of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please call the Funds at (800) 882-0052.

Availability of Quarterly Schedule of Investments

The Funds file their complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The Funds’ Forms N-Q are available on the SEC’s website at http://www.sec.gov and may also be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. Information on the operation of the Public Reference Room or how to access documents on the SEC’s website without charge may be obtained by calling (800) SEC-0330. The Funds’ Forms N-Q may also be obtained upon request and without charge by calling (800) 882-0052.

Availability of Proxy Voting Policies and Procedures

A description of the policies and procedures that the Funds use to determine how to vote proxies relating to portfolio securities is available upon request and without charge (1) by calling (800) 882-0052; (2) at http://www.blackrock.com; and (3) on the SEC’s website at http://www.sec.gov.

Availability of Proxy Voting Record

Information about how the Funds voted proxies relating to securities held in the Funds’ portfolios during the most recent 12-month period ended June 30 is available upon request and without charge (1) at http://www.blackrock.com; or by calling (800) 882-0052; and (2) on the SEC’s website at http://www.sec.gov.

 

 

ADDITIONAL INFORMATION      105  


Additional Information  (continued)

 

Availability of Fund Updates

BlackRock will update performance and certain other data for the Funds on a monthly basis on its website in the “Closed-end Funds” section of http://www.blackrock.com as well as certain other material information as necessary from time to time. Investors and others are advised to check the website for updated performance information and the release of other material information about the Funds. This reference to BlackRock’s website is intended to allow investors public access to information regarding the Funds and does not, and is not intended to, incorporate BlackRock’s website in this report.

Section 19(a) Notice

MUA’s amounts and sources of distributions reported are estimates and are being provided to you pursuant to regulatory requirements and are not being provided for tax reporting purposes. The actual amounts and sources for tax reporting purposes will depend upon each Fund’s investment experience during the remainder of the fiscal year and may be subject to changes based on tax regulations. Each Fund will provide a Form 1099-DIV each calendar year that will tell you how to report these distributions for U.S. federal income tax purposes.

 

     Total Fiscal Year-to-Date
Cumulative Distributions by Character
    Percentage of Fiscal Year-to-Date
Cumulative Distributions by Character
 
     Net
Investment
Income
    Net Realized
Capital Gains
Short Term
    Net Realized
Capital Gains
Long Term
    Return of
Capital
    Total Per
Common
Share
    Net
Investment
Income
    Net Realized
Capital Gains
Short Term
    Net Realized
Capital Gains
Long Term
    Return of
Capital
    Total Per
Common
Share
 

MUA

  $ 0.678343                       $ 0.678343       100                       100

Section 19(a) notices for the Funds, as applicable, are available on the BlackRock website at http://www.blackrock.com.

BlackRock Privacy Principles

BlackRock is committed to maintaining the privacy of its current and former fund investors and individual clients (collectively, “Clients”) and to safeguarding their non-public personal information. The following information is provided to help you understand what personal information BlackRock collects, how we protect that information and why in certain cases we share such information with select parties.

If you are located in a jurisdiction where specific laws, rules or regulations require BlackRock to provide you with additional or different privacy-related rights beyond what is set forth below, then BlackRock will comply with those specific laws, rules or regulations.

BlackRock obtains or verifies personal non-public information from and about you from different sources, including the following: (i) information we receive from you or, if applicable, your financial intermediary, on applications, forms or other documents; (ii) information about your transactions with us, our affiliates, or others; (iii) information we receive from a consumer reporting agency; and (iv) from visits to our websites.

BlackRock does not sell or disclose to non-affiliated third parties any non-public personal information about its Clients, except as permitted by law or as is necessary to respond to regulatory requests or to service Client accounts. These non-affiliated third parties are required to protect the confidentiality and security of this information and to use it only for its intended purpose.

We may share information with our affiliates to service your account or to provide you with information about other BlackRock products or services that may be of interest to you. In addition, BlackRock restricts access to non-public personal information about its Clients to those BlackRock employees with a legitimate business need for the information. BlackRock maintains physical, electronic and procedural safeguards that are designed to protect the non-public personal information of its Clients, including procedures relating to the proper storage and disposal of such information.

 

 

106    2018 BLACKROCK ANNUAL REPORT TO SHAREHOLDERS


Glossary of Terms Used in this Report

 

Portfolio Abbreviations
AGC    Assured Guarantee Corp.
AGM    Assured Guaranty Municipal Corp.
AMBAC    American Municipal Bond Assurance Corp.
AMT    Alternative Minimum Tax (subject to)
ARB    Airport Revenue Bonds
BAM    Build America Mutual Assurance Co.
BARB    Building Aid Revenue Bonds
BHAC    Berkshire Hathaway Assurance Corp.
CAB    Capital Appreciation Bonds
COP    Certificates of Participation
EDA    Economic Development Authority
EDC    Economic Development Corp.
ERB    Education Revenue Bonds
GARB    General Airport Revenue Bonds
GO    General Obligation Bonds
GTD    Guaranteed
HFA    Housing Finance Agency
IDA    Industrial Development Authority
ISD    Independent School District
M/F    Multi-Family
MRB    Mortgage Revenue Bonds
NPFGC    National Public Finance Guarantee Corp.
PSF    Permanent School Fund
PSF-GTD    Permanent School Fund Guaranteed
RB    Revenue Bonds
S/F    Single-Family
 

 

 

GLOSSARY OF TERMS USED IN THIS REPORT      107  


This report is intended for current holders. It is not a prospectus. Past performance results shown in this report should not be considered a representation of future performance. The Funds have leveraged their Common Shares, which creates risks for Common Shareholders, including the likelihood of greater volatility of net asset value and market price of the Common Shares, and the risk that fluctuations in short-term interest rates may reduce the Common Shares’ yield. Statements and other information herein are as dated and are subject to change.

 

LOGO

 

CEMUNI7-4/18-AR    LOGO


Item 2 – Code of Ethics – The registrant (or the “Fund”) has adopted a code of ethics, as of the end of the period covered by this report, applicable to the registrant’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. During the period covered by this report, the code of ethics was amended to clarify an inconsistency as to whom persons covered by the code should report suspected violations of the code. The amendment clarifies that such reporting should be made to BlackRock Advisors, LLC’s (“Investment Adviser” or “BlackRock”) General Counsel, and retains the alternative option of anonymous reporting following “whistleblower” policies. Other non-material changes were also made in connection with this amendment. During the period covered by this report, there have been no waivers granted under the code of ethics. The registrant undertakes to provide a copy of the code of ethics to any person upon request, without charge, who calls 1-800-882-0052, option 4.

 

Item 3 – Audit Committee Financial Expert – The registrant’s board of directors (the “board of directors”), has determined that (i) the registrant has the following audit committee financial experts serving on its audit committee and (ii) each audit committee financial expert is independent:

Michael Castellano

Frank J. Fabozzi

W. Carl Kester

Catherine A. Lynch

Karen P. Robards

The registrant’s board of directors has determined that W. Carl Kester and Karen P. Robards qualify as financial experts pursuant to Item 3(c)(4) of Form N-CSR.

Prof. Kester has a thorough understanding of generally accepted accounting principles, financial statements and internal control over financial reporting as well as audit committee functions. Prof. Kester has been involved in providing valuation and other financial consulting services to corporate clients since 1978. Prof. Kester’s financial consulting services present a breadth and level of complexity of accounting issues that are generally comparable to the breadth and complexity of issues that can reasonably be expected to be raised by the registrant’s financial statements.

Ms. Robards has a thorough understanding of generally accepted accounting principles, financial statements and internal control over financial reporting as well as audit committee functions. Ms. Robards has been a principal of Robards & Company, a financial advisory firm, since 1987. Ms. Robards was formerly an investment banker for more than 10 years where she was responsible for evaluating and assessing the performance of companies based on their financial results. Ms. Robards has over 30 years of experience analyzing financial statements. She also is a member of the audit committee of one publicly held company and a non-profit organization.

Under applicable securities laws, a person determined to be an audit committee financial expert will not be deemed an “expert” for any purpose, including without limitation for the purposes of Section 11 of the Securities Act of 1933, as a result of being designated or identified as an audit committee financial expert. The designation or identification as an audit committee financial expert does not impose on such person any duties, obligations, or liabilities greater than the duties, obligations, and liabilities imposed on such person as a member of the audit committee and board of directors in the absence of such designation or identification. The designation or identification of a person as an

 

2


audit committee financial expert does not affect the duties, obligations, or liability of any other member of the audit committee or board of directors.

 

Item 4 – Principal Accountant Fees and Services

The following table presents fees billed by Deloitte & Touche LLP (“D&T”) in each of the last two fiscal years for the services rendered to the Fund:

 

    

 

(a) Audit Fees

  (b) Audit-Related Fees1       (c) Tax Fees2   (d) All Other Fees
Entity Name  

Current  

Fiscal Year  

End  

 

Previous  

Fiscal Year  

End  

 

Current  

Fiscal Year  

End  

 

Previous  

Fiscal Year  

End  

 

Current  

Fiscal Year  

End  

 

Previous  

Fiscal Year  

End  

 

Current  

Fiscal Year  

End  

 

Previous  

Fiscal Year  

End  

BlackRock Muni Intermediate Duration Fund, Inc.   $38,300   $39,028   $0   $0   $20,500   $20,502   $0   $0

The following table presents fees billed by D&T that were required to be approved by the registrant’s audit committee (the “Committee”) for services that relate directly to the operations or financial reporting of the Fund and that are rendered on behalf of BlackRock and entities controlling, controlled by, or under common control with BlackRock (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser) that provide ongoing services to the Fund (“Affiliated Service Providers”):

 

     

 

Current Fiscal Year End

   Previous Fiscal Year End
(b) Audit-Related Fees1    $0    $0
(c) Tax Fees2    $0    $0
(d) All Other Fees3    $2,274,000    $2,129,000

1 The nature of the services includes assurance and related services reasonably related to the performance of the audit or review of financial statements not included in Audit Fees, including accounting consultations, agreed-upon procedure reports, attestation reports, comfort letters, out-of-pocket expenses and internal control reviews not required by regulators.

2 The nature of the services includes tax compliance and/or tax preparation, including services relating to the filing or amendment of federal, state or local income tax returns, regulated investment company qualification reviews, taxable income and tax distribution calculations.

3 Non-audit fees of $2,274,000 and $2,129,000 for the current fiscal year and previous fiscal year, respectively, were paid to the Fund’s principal accountant in their entirety by BlackRock, in connection with services provided to the Affiliated Service Providers of the Fund and of certain other funds sponsored and advised by BlackRock or its affiliates for a service organization review and an accounting research tool subscription. These amounts represent aggregate fees paid by BlackRock and were not allocated on a per fund basis.

(e)(1) Audit Committee Pre-Approval Policies and Procedures:

The Committee has adopted policies and procedures with regard to the pre-approval of services. Audit, audit-related and tax compliance services provided to the registrant on an annual basis require specific pre-approval by the Committee. The Committee also must approve other non-audit services provided to the registrant and those non-audit services provided to the Investment Adviser and Affiliated Service Providers that relate directly to the operations and the financial reporting of the registrant. Certain of these non-audit services that the Committee believes are (a) consistent with the SEC’s auditor independence rules and (b) routine and recurring services that will not impair the independence of the independent accountants may be approved by the Committee without consideration on a specific case-by-case basis (“general pre-approval”). The term of any general pre-approval is 12 months from the date of the pre-approval, unless the Committee provides for a different period. Tax or other non-audit services provided to the registrant which have a direct impact on the operations or financial reporting of the registrant will only be deemed pre-approved

 

3


provided that any individual project does not exceed $10,000 attributable to the registrant or $50,000 per project. For this purpose, multiple projects will be aggregated to determine if they exceed the previously mentioned cost levels.

Any proposed services exceeding the pre-approved cost levels will require specific pre-approval by the Committee, as will any other services not subject to general pre-approval (e.g., unanticipated but permissible services). The Committee is informed of each service approved subject to general pre-approval at the next regularly scheduled in-person board meeting. At this meeting, an analysis of such services is presented to the Committee for ratification. The Committee may delegate to the Committee Chairman the authority to approve the provision of and fees for any specific engagement of permitted non-audit services, including services exceeding pre-approved cost levels.

(e)(2) None of the services described in each of Items 4(b) through (d) were approved by the Committee pursuant to the de minimis exception in paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.

(f) Not Applicable

(g) The aggregate non-audit fees, defined as the sum of the fees shown under “Audit-Related Fees,” “Tax Fees” and “All Other Fees,” paid to the accountant for services rendered by the accountant to the registrant, the Investment Adviser and the Affiliated Service Providers were:

 

Entity Name   

Current Fiscal    

Year End    

  

Previous Fiscal    

Year End    

BlackRock Muni Intermediate Duration Fund, Inc.    $20,500    $20,502

Additionally, the amounts billed by D&T in connection with services provided to the Affiliated Service Providers of the Fund and of other funds sponsored or advised by BlackRock or its affiliates during the current and previous fiscal years for a service organization review and an accounting research tool subscription were:

 

Current Fiscal

Year End

  

Previous Fiscal

Year End

$2,274,000    $2,129,000

These amounts represent aggregate fees paid by BlackRock and were not allocated on a per fund basis.

(h) The Committee has considered and determined that the provision of non-audit services that were rendered to the Investment Adviser, and the Affiliated Service Providers that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with maintaining the principal accountant’s independence.

 

Item 5 – Audit Committee of Listed Registrants

 

4


  (a) The following individuals are members of the registrant’s separately-designated standing audit committee established in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)(58)(A)):  

Michael Castellano

Frank J. Fabozzi

W. Carl Kester

Catherine A. Lynch

Karen P. Robards

 

  (b) Not Applicable

 

Item 6 – Investments

(a) The registrant’s Schedule of Investments is included as part of the Report to Stockholders filed under Item 1 of this Form.

(b) Not Applicable due to no such divestments during the semi-annual period covered since the previous Form N-CSR filing.

 

Item 7 – Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies – The board of directors has delegated the voting of proxies for the Fund’s portfolio securities to the Investment Adviser pursuant to the Investment Adviser’s proxy voting guidelines. Under these guidelines, the Investment Adviser will vote proxies related to Fund securities in the best interests of the Fund and its stockholders. From time to time, a vote may present a conflict between the interests of the Fund’s stockholders, on the one hand, and those of the Investment Adviser, or any affiliated person of the Fund or the Investment Adviser, on the other. In such event, provided that the Investment Adviser’s Equity Investment Policy Oversight Committee, or a sub-committee thereof (the “Oversight Committee”) is aware of the real or potential conflict or material non-routine matter and if the Oversight Committee does not reasonably believe it is able to follow its general voting guidelines (or if the particular proxy matter is not addressed in the guidelines) and vote impartially, the Oversight Committee may retain an independent fiduciary to advise the Oversight Committee on how to vote or to cast votes on behalf of the Investment Adviser’s clients. If the Investment Adviser determines not to retain an independent fiduciary, or does not desire to follow the advice of such independent fiduciary, the Oversight Committee shall determine how to vote the proxy after consulting with the Investment Adviser’s Portfolio Management Group and/or the Investment Adviser’s Legal and Compliance Department and concluding that the vote cast is in its client’s best interest notwithstanding the conflict. A copy of the Fund’s Proxy Voting Policy and Procedures are attached as Exhibit 99.PROXYPOL. Information on how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available without charge, (i) at www.blackrock.com and (ii) on the SEC’s website at http://www.sec.gov.

 

Item 8 – Portfolio Managers of Closed-End Management Investment Companies

(a)(1) As of the date of filing this Report:

The registrant is managed by a team of investment professionals comprised of Michael Kalinoski, Director at BlackRock, and Michael Perilli, Vice President at BlackRock. Each is

 

5


a member of BlackRock’s municipal tax-exempt management group. Each is jointly responsible for the day-to-day management of the registrant’s portfolio, which includes setting the registrant’s overall investment strategy, overseeing the management of the registrant and selection of its investments. Messrs. Kalinoski and Perilli have both been members of the registrant’s portfolio management team since 2017.

 

 

Portfolio Manager

   Biography

 

Michael Kalinoski

   Director of BlackRock since 2006; Director of Merrill Lynch Investment Managers, L.P. (“MLIM”) from 1999 to 2006.

 

Michael Perilli

   Vice President of BlackRock since 2017; Associate of BlackRock from 2008 to 2016.

 

(a)(2) As of April 30, 2018:

 

    

            (ii) Number of Other Accounts Managed             

and Assets by Account Type

 

            (iii) Number of Other Accounts and             

Assets for Which Advisory Fee is

Performance-Based

(i) Name of

Portfolio Manager1

 

Other

Registered

Investment

Companies

 

Other Pooled

Investment

Vehicles

 

Other

  Accounts  

 

Other

Registered

Investment

  Companies  

 

Other Pooled

Investment

Vehicles

  

Other

  Accounts  

Michael Kalinoski   20   0   0   0   0    0
    $24.92 Billion   $0   $0   $0   $0    $0
Michael Perilli   16   0   0   0   0    0
    $4.16 Billion   $0   $0   $0   $0    $0

(iv) Potential Material Conflicts of Interest

BlackRock has built a professional working environment, firm-wide compliance culture and compliance procedures and systems designed to protect against potential incentives that may favor one account over another. BlackRock has adopted policies and procedures that address the allocation of investment opportunities, execution of portfolio transactions, personal trading by employees and other potential conflicts of interest that are designed to ensure that all client accounts are treated equitably over time. Nevertheless, BlackRock furnishes investment management and advisory services to numerous clients in addition to the Fund, and BlackRock may, consistent with applicable law, make investment recommendations to other clients or accounts (including accounts which are hedge funds or have performance or higher fees paid to BlackRock, or in which portfolio managers have a personal interest in the receipt of such fees), which may be the same as or different from those made to the Fund. In addition, BlackRock, Inc., its affiliates and significant shareholders and any officer, director, shareholder or employee may or may not have an interest in the securities whose purchase and sale BlackRock recommends to the Fund. BlackRock, Inc. or any of its affiliates or significant shareholders, or any officer, director, shareholder, employee or any member of their families may take different actions than those recommended to the Fund by BlackRock with respect to the same securities. Moreover, BlackRock may refrain from rendering any advice or services concerning securities of companies of which any of BlackRock, Inc.’s (or its affiliates’ or significant shareholders’) officers, directors or employees are directors or officers, or companies as to which BlackRock, Inc. or any of its affiliates or significant shareholders or the officers, directors and employees of any of them has any substantial economic interest or possesses material non-public

 

6


information. Certain portfolio managers also may manage accounts whose investment strategies may at times be opposed to the strategy utilized for a fund. It should also be noted that a portfolio manager may be managing certain hedge fund and/or long only accounts, or may be part of a team managing certain hedge fund and/or long only accounts, subject to incentive fees. Such portfolio managers may therefore be entitled to receive a portion of any incentive fees earned on such accounts. Currently, the portfolio managers of this fund are not entitled to receive a portion of incentive fees of other accounts.

As a fiduciary, BlackRock owes a duty of loyalty to its clients and must treat each client fairly. When BlackRock purchases or sells securities for more than one account, the trades must be allocated in a manner consistent with its fiduciary duties. BlackRock attempts to allocate investments in a fair and equitable manner among client accounts, with no account receiving preferential treatment. To this end, BlackRock, Inc. has adopted policies that are intended to ensure reasonable efficiency in client transactions and provide BlackRock with sufficient flexibility to allocate investments in a manner that is consistent with the particular investment discipline and client base, as appropriate.

(a)(3) As of April 30, 2018:

Portfolio Manager Compensation Overview

The discussion below describes the portfolio managers’ compensation as of April 30, 2018.

BlackRock’s financial arrangements with its portfolio managers, its competitive compensation and its career path emphasis at all levels reflect the value senior management places on key resources. Compensation may include a variety of components and may vary from year to year based on a number of factors. The principal components of compensation include a base salary, a performance-based discretionary bonus, participation in various benefits programs and one or more of the incentive compensation programs established by BlackRock.

Base Compensation. Generally, portfolio managers receive base compensation based on their position with the firm.

Discretionary Incentive Compensation

Discretionary incentive compensation is a function of several components: the performance of BlackRock, Inc., the performance of the portfolio manager’s group within BlackRock, the investment performance, including risk-adjusted returns, of the firm’s assets under management or supervision by that portfolio manager relative to predetermined benchmarks, and the individual’s performance and contribution to the overall performance of these portfolios and BlackRock. In most cases, these benchmarks are the same as the benchmark or benchmarks against which the performance of the Fund or other accounts managed by the portfolio managers are measured. Among other things, BlackRock’s Chief Investment Officers make a subjective determination with respect to each portfolio manager’s compensation based on the performance of the Fund and other accounts managed by each portfolio manager relative to the various benchmarks. Performance of fixed income funds is measured on a pre-tax and/or after-tax basis over various time periods including 1-, 3- and 5- year periods, as applicable. With respect to these portfolio managers, such

 

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benchmarks for the Fund and other accounts are: a combination of market-based indices (e.g., Standard & Poor’s Municipal Bond Index), certain customized indices and certain fund industry peer groups.

Distribution of Discretionary Incentive Compensation. Discretionary incentive compensation is distributed to portfolio managers in a combination of cash, deferred BlackRock, Inc. stock awards, and/or deferred cash awards that notionally track the return of certain BlackRock investment products.

Portfolio managers receive their annual discretionary incentive compensation in the form of cash. Portfolio managers whose total compensation is above a specified threshold also receive deferred BlackRock, Inc. stock awards annually as part of their discretionary incentive compensation. Paying a portion of discretionary incentive compensation in the form of deferred BlackRock, Inc. stock puts compensation earned by a portfolio manager for a given year “at risk” based on BlackRock’s ability to sustain and improve its performance over future periods. In some cases, additional deferred BlackRock, Inc. stock may be granted to certain key employees as part of a long-term incentive award to aid in retention, align interests with long-term shareholders and motivate performance. Deferred BlackRock, Inc. stock awards are generally granted in the form of BlackRock, Inc. restricted stock units that vest pursuant to the terms of the applicable plan and, once vested, settle in BlackRock, Inc. common stock. The portfolio managers of this Fund have deferred BlackRock, Inc. stock awards.

For certain portfolio managers, a portion of the discretionary incentive compensation is also distributed in the form of deferred cash awards that notionally track the returns of select BlackRock investment products they manage, which provides direct alignment of portfolio manager discretionary incentive compensation with investment product results. Deferred cash awards vest ratably over a number of years and, once vested, settle in the form of cash. Only portfolio managers who manage specified products and whose total compensation is above a specified threshold are eligible to participate in the deferred cash award program.

Other Compensation Benefits. In addition to base salary and discretionary incentive compensation, portfolio managers may be eligible to receive or participate in one or more of the following:

Incentive Savings Plans — BlackRock, Inc. has created a variety of incentive savings plans in which BlackRock, Inc. employees are eligible to participate, including a 401(k) plan, the BlackRock Retirement Savings Plan (RSP), and the BlackRock Employee Stock Purchase Plan (ESPP). The employer contribution components of the RSP include a company match equal to 50% of the first 8% of eligible pay contributed to the plan capped at $5,000 per year, and a company retirement contribution equal to 3-5% of eligible compensation up to the Internal Revenue Service limit ($275,000 for 2018). The RSP offers a range of investment options, including registered investment companies and collective investment funds managed by the firm. BlackRock, Inc. contributions follow the investment direction set by participants for their own contributions or, absent participant investment direction, are invested into a target date fund that corresponds to, or is closest to, the year in which the participant attains age 65. The ESPP allows for investment in BlackRock, Inc. common stock at a 5% discount on the fair market value of the stock on the purchase date. Annual participation in the ESPP is limited to the purchase of 1,000 shares of

 

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common stock or a dollar value of $25,000 based on its fair market value on the purchase date. All of the eligible portfolio managers are eligible to participate in these plans.

(a)(4) Beneficial Ownership of Securities – As of April 30, 2018:

 

Portfolio Manager   

Dollar Range of Equity Securities

of the Fund Beneficially Owned

Michael Kalinoski    None
Michael Perilli    None

(b) Not Applicable

 

Item 9 – Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers – Not Applicable due to no such purchases during the period covered by this report.

 

Item 10 – Submission of Matters to a Vote of Security Holders – There have been no material changes to these procedures.

 

Item 11 – Controls and Procedures

(a) – The registrant’s principal executive and principal financial officers, or persons performing similar functions, have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”)) are effective as of a date within 90 days of the filing of this report based on the evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act and Rule 13a-15(b) under the Securities Exchange Act of 1934, as amended.

(b) – There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) that occurred during the second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting.

 

Item 12 – Disclosure of Securities Lending Activities for Closed-End Management Investment Companies – Not Applicable

 

Item 13 – Exhibits attached hereto

(a)(1) – Code of Ethics – See Item 2

(a)(2) – Certifications – Attached hereto

(a)(3) – Not Applicable

(a)(4) – Not Applicable

(b) – Certifications – Attached hereto

 

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Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

BlackRock Muni Intermediate Duration Fund, Inc.

 

By:     /s/ John M. Perlowski                            
  John M. Perlowski
  Chief Executive Officer (principal executive officer) of
  BlackRock Muni Intermediate Duration Fund, Inc.

Date: July 5, 2018

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

 

By:     /s/ John M. Perlowski                            
  John M. Perlowski
  Chief Executive Officer (principal executive officer) of
  BlackRock Muni Intermediate Duration Fund, Inc.

Date: July 5, 2018

 

By:     /s/ Neal J. Andrews                                
  Neal J. Andrews
  Chief Financial Officer (principal financial officer) of
  BlackRock Muni Intermediate Duration Fund, Inc.

Date: July 5, 2018

 

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