BlackRock MuniHoldings Quality Fund, Inc.

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-Q

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED

MANAGEMENT INVESTMENT COMPANY

Investment Company Act file number 811-08707

Name of Fund: BlackRock MuniHoldings Quality Fund, Inc. (MUS)

Fund Address: 100 Bellevue Parkway, Wilmington, DE 19809

Name and address of agent for service: John M. Perlowski, Chief Executive Officer, BlackRock MuniHoldings Quality 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: 04/30/2013

Date of reporting period: 01/31/2013

Item 1    –    Schedule of Investments

Schedule of Investments January 31, 2013 (Unaudited)    BlackRock MuniHoldings Quality Fund, Inc. (MUS)
   (Percentages shown are based on Net Assets)

 

Municipal Bonds

    Par
(000)		      Value  

Alabama – 1.7%

      

Birmingham Special Care Facilities Financing Authority, RB, Children’s Hospital (AGC),

      

6.00%, 6/01/39

    $ 2,330       $ 2,725,797   

Selma IDB, RB, International Paper Company Project, Series A,

      

5.38%, 12/01/35

      565         624,517   
     

 

 

  
        3,350,314   
     

 

 

  

Arizona – 0.6%

      

Arizona Board of Regents, University of Arizona, Refunding RB, Series A,

      

5.00%, 6/01/42

      1,000         1,144,200   
     

 

 

  

California – 16.9%

      

California Educational Facilities Authority, RB, University of Southern California, Series A,

      

5.25%, 10/01/38

      2,895         3,413,610   

California Health Facilities Financing Authority, RB, Sutter Health, Series B,

      

6.00%, 8/15/42

      1,730         2,079,131   

Central Unified School District, GO, Election of 2008, Series A (AGC),

      

5.63%, 8/01/33

      1,325         1,530,706   

City of San Jose California, Refunding ARB, Series A-1, AMT:

      

5.50%, 3/01/30

      2,400         2,751,696   

5.75%, 3/01/34

      2,180         2,529,323   

City of Sunnyvale California, Refunding RB,

      

5.25%, 4/01/40

      1,605         1,853,037   

County of Sacramento California, ARB, Senior Series A (AGC),

      

5.50%, 7/01/41

      2,100         2,438,037   

Los Angeles Community College District California, GO, Election of 2008, Series C,

      

5.25%, 8/01/39

      1,000         1,213,280   

Los Angeles Department of Water & Power, RB, Power System, Sub-Series A-1,

      

5.25%, 7/01/38

      1,575         1,810,321   

Oceanside Unified School District California, GO, Series A (AGC),

      

5.25%, 8/01/33

      1,825         2,044,548   

Redondo Beach Unified School District, GO, Election of 2008, Series E,

      

5.50%, 8/01/34

      1,335         1,597,047   

San Bernardino Community College District, GO, Election of 2002, Series A,

      

6.25%, 8/01/33

      1,250         1,514,725   

San Pablo Joint Powers Financing Authority California, Tax Allocation Bonds, Refunding, CAB (NPFGC)(a):

      

5.56%, 12/01/24

      2,635         1,376,893   

5.62%, 12/01/25

      2,355         1,156,517   

5.66%, 12/01/26

      2,355         1,088,717   

State of California, GO, Refunding, Tax Exempt, Refunding Various Purpose,

      

5.00%, 9/01/41

      2,765         3,115,989   

Ventura County Community College District, GO, Election of 2002, Series C,

      

5.50%, 8/01/33

      1,850         2,194,451   
     

 

 

  
        33,708,028   
     

 

 

  

Colorado – 1.7%

      

City & County of Denver Colorado, Refunding ARB, Aviation Airport System Revenue, Series B,

      

5.00%, 11/15/37

      910         1,045,863   

Colorado Health Facilities Authority, RB, Hospital, NCMC, Inc. Project, Series B (AGM),

      

6.00%, 5/15/26

      1,900         2,259,119   
     

 

 

  
        3,304,982   
     

 

 

  

District of Columbia – 1.2%

      

District of Columbia Water & Sewer Authority, Refunding RB, Series A,

      

5.50%, 10/01/39

      2,000         2,325,440   
     

 

 

  

Florida – 7.2%

      

City of Jacksonville Florida, Refunding RB, Better Jacksonville, Series A,

      

5.00%, 10/01/30

      1,135         1,324,216   

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

      

5.38%, 10/01/32

      1,500         1,685,415   

Jacksonville Florida Port Authority, Refunding RB, AMT,

      

5.00%, 11/01/38

      1,265         1,374,751   

Orange County School Board, COP, Series A (AGC),

      

5.50%, 8/01/34

      4,645         5,373,661   

Tohopekaliga Water Authority, Refunding RB, Series A,

      

5.25%, 10/01/36

      3,995         4,663,084   
     

 

 

  
        14,421,127   
     

 

 

  

Illinois – 14.5%

      

Chicago Illinois Board of Education, GO, Series A:

      

5.50%, 12/01/39

      2,000         2,338,020   

5.00%, 12/01/42

      2,835         3,109,400   

Chicago Illinois Transit Authority, RB:

      

Federal Transit Administration Section 5309, Series A (AGC), 6.00%, 6/01/26

      2,000         2,324,140   

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

      635         732,866   

Sales Tax Receipts Revenue, 5.25%, 12/01/40

      1,810         2,072,486   

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

      

Series A, 5.75%, 1/01/39

      1,145         1,348,615   

Series C, 6.50%, 1/01/41

      5,225         6,756,709   

 

    BLACKROCK MUNIHOLDINGS QUALITY FUND, INC.    JANUARY 31, 2013   1

Schedule of Investments (continued)    BlackRock MuniHoldings Quality Fund, Inc. (MUS)
   (Percentages shown are based on Net Assets)

 

Municipal Bonds

    Par
(000)		      Value  

Illinois (concluded)

      

City of Chicago Illinois, Sales Tax Revenue, Refunding RB, Series A,

      

5.25%, 1/01/38

    $ 795       $ 917,207   

City of Chicago Illinois Waterworks Revenue, Refunding RB, Second Lien,

      

5.00%, 11/01/42

      1,425         1,611,533   

Cook County Forest Preserve District, GO, Series C,

      

5.00%, 12/15/32

      580         667,998   

Cook County Forest Preserve District, GO, Refunding, Limited Tax Project, Series B,

      

5.00%, 12/15/32

      270         310,964   

Metropolitan Pier & Exposition Authority, Refunding RB, McCormick Place Project, Series B,

      

5.00%, 12/15/28

      2,045         2,393,325   

Railsplitter Tobacco Settlement Authority, RB:

      

5.50%, 6/01/23

      1,405         1,671,472   

6.00%, 6/01/28

      400         480,364   

State of Illinois, RB, Build Illinois, Series B,

      

5.25%, 6/15/28

      2,000         2,357,920   
     

 

 

  
        29,093,019   
     

 

 

  

Indiana – 3.6%

      

Indiana Finance Authority Waste Water Utility, RB, CWA Authority, First Lien, Series A,

      

5.00%, 10/01/41

      1,855         2,095,408   

Indianapolis Local Public Improvement Bond Bank, RB, Series F,

      

5.25%, 2/01/36

      3,055         3,554,828   

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

      

5.50%, 1/01/38

      1,430         1,623,279   
     

 

 

  
        7,273,515   
     

 

 

  

Kansas – 1.2%

      

Kansas Development Finance Authority, Refunding RB, Adventist Health System/Sunbelt Obligated Group,

      

5.00%, 11/15/32

      2,130         2,467,413   
     

 

 

  

Massachusetts – 0.4%

      

Massachusetts Development Finance Agency, RB, Wellesley College, Series J,

      

5.00%, 7/01/42

      675         786,827   
     

 

 

  

Michigan – 4.7%

      

City of Detroit Michigan Sewage Disposal System, Refunding RB, Senior Lien (AGM):

      

Series B, 7.50%, 7/01/33

      750         937,192   

Series C-1, 7.00%, 7/01/27

      4,810         5,928,421   

Royal Oak Hospital Finance Authority Michigan, Refunding RB, William Beaumont Hospital,

      

8.25%, 9/01/39

      1,910         2,442,241   
     

 

 

  
        9,307,854   
     

 

 

  

Minnesota – 0.8%

      

City of Minneapolis Minnesota, Refunding RB, Series B (AGC),

      

6.50%, 11/15/38

      1,325         1,627,378   
     

 

 

  

Mississippi – 2.0%

      

Mississippi Development Bank, Refunding RB:

      

Jackson Mississippi Water and Sewer, Series A (AGM), 5.00%, 9/01/30

      2,940         3,426,511   

Jackson Public School District Project, 5.00%, 4/01/28

      570         649,920   
     

 

 

  
        4,076,431   
     

 

 

  

Nevada – 3.5%

      

Clark County Water Reclamation District, GO, Series A,

      

5.25%, 7/01/34

      1,500         1,801,680   

County of Clark Nevada, ARB:

      

Las Vegas-McCarran International Airport, Series A (AGC), 5.25%, 7/01/39

      3,410         3,838,330   

Subordinate Lien, Series A-2 (NPFGC), 5.00%, 7/01/36

      1,360         1,424,396   
     

 

 

  
        7,064,406   
     

 

 

  

New Jersey – 8.3%

      

New Jersey EDA, RB, Motor Vehicle Surcharge, Series A (NPFGC),

      

5.25%, 7/01/33

      3,575         3,776,952   

New Jersey Health Care Facilities Financing Authority, RB, Virtua Health (AGC),

      

5.50%, 7/01/38

      2,100         2,343,285   

New Jersey Transportation Trust Fund Authority, RB, Transportation System:

      

Series A, 5.50%, 6/15/41

      1,780         2,068,591   

Series A (AGC), 5.63%, 12/15/28

      3,170         3,779,211   

Series B, 5.25%, 6/15/36

      1,000         1,146,320   

South Jersey Transportation Authority, Refunding RB, Transportation System, Series A:

      

5.00%, 11/01/27

      2,000         2,325,420   

5.00%, 11/01/28

      1,000         1,157,860   
     

 

 

  
        16,597,639   
     

 

 

  

New York – 7.9%

      

Hudson New York Yards Infrastructure Corp., RB, Series A,

      

5.75%, 2/15/47

      2,510         2,995,208   

New York City Municipal Water Finance Authority, Refunding RB:

      

Fiscal 2009, Series EE, 5.25%, 6/15/40

      3,410         3,940,187   

 

2   BLACKROCK MUNIHOLDINGS QUALITY FUND, INC.    JANUARY 31, 2013    

Schedule of Investments (continued)    BlackRock MuniHoldings Quality Fund, Inc. (MUS)
   (Percentages shown are based on Net Assets)

 

Municipal Bonds

    Par
(000)		      Value  

New York (concluded)

      

New York City Municipal Water Finance Authority, Refunding RB (concluded):

      

Water & Sewer System, Second General Resolution Series EE, 5.38%, 6/15/43

    $ 1,305       $ 1,531,665   

New York State Dormitory Authority, RB, Series B:

      

5.00%, 3/15/37

      3,350         3,878,228   

5.00%, 3/15/42

      2,000         2,289,600   

New York State Thruway Authority, Refunding RB, Series I,

      

5.00%, 1/01/37

      1,050         1,191,225   
     

 

 

  
        15,826,113   
     

 

 

  

North Carolina – 1.2%

      

North Carolina Medical Care Commission, RB, Duke University Health System, Series A,

      

5.00%, 6/01/32

      2,045         2,404,859   
     

 

 

  

Ohio – 1.3%

      

Ohio State University, RB, General Receipts Special Purpose, Series A:

      

5.00%, 6/01/38

      905         1,056,009   

5.00%, 6/01/43

      1,360         1,572,595   
     

 

 

  
        2,628,604   
     

 

 

  

Puerto Rico – 1.2%

      

Puerto Rico Sales Tax Financing Corp., RB, First Sub-Series A,

      

6.38%, 8/01/39

      2,115         2,379,417   
     

 

 

  

Texas – 27.4%

      

Austin Community College District, RB, Educational Facilities Project, Round Rock Campus,

      

5.25%, 8/01/33

      2,500         2,859,950   

City of Houston Texas, Refunding RB, Combined First Lien, Series A (AGC),

      

6.00%, 11/15/35

      4,000         4,874,880   

Dallas Area Rapid Transit, Refunding RB, Senior Lien,

      

5.25%, 12/01/38

      2,600         3,009,760   

Dallas Fort Worth International Airport, ARB, Series H, AMT,

      

5.00%, 11/01/42

      5,610         6,054,817   

Dallas Fort Worth International Airport, Refunding RB, Series E, AMT,

      

5.00%, 11/01/35

      3,000         3,277,440   

Harris County Health Facilities Development Corp., Refunding RB, Memorial Hermann Healthcare System,
Series B,

      

7.25%, 12/01/35

      600         747,498   

Katy ISD Texas, GO, Refunding, Unlimited Tax School Building, Series A (PSF-GTD),

      

5.00%, 2/15/42

      1,135         1,311,595   

North Texas Tollway Authority, RB, Special Projects System, Series A,

      

5.50%, 9/01/41

      4,250         5,059,285   

North Texas Tollway Authority, Refunding RB, System, First Tier (NPFGC):

      

5.75%, 1/01/40

      4,885         5,617,555   

Series A, 5.63%, 1/01/33

      6,585         7,534,623   

Series B, 5.75%, 1/01/40

      6,275         7,215,999   

Series B, 5.00%, 1/01/42

      1,020         1,137,116   

Texas Tech University, Refunding RB, Improvement Bonds Fourteenth, Series A,

      

5.00%, 8/15/31

      1,765         2,078,605   

Texas Transportation Commission, Refunding RB, First Tier, Series A,

      

5.00%, 8/15/41

      670         739,459   

University of Texas System, Refunding RB, Series B,

      

5.00%, 8/15/43

      2,755         3,236,574   
     

 

 

  
        54,755,156   
     

 

 

  

Utah – 2.0%

      

Utah Transit Authority, Refunding RB, Series 2012,

      

5.00%, 6/15/42

      3,500         3,955,070   
     

 

 

  

Virginia – 2.5%

      

Fairfax County IDA, RB, Series A,

      

5.00%, 5/15/40

      1,045         1,187,873   

Virginia Public School Authority, RB, School Financing,

      

6.50%, 12/01/18(b)

      1,300         1,715,038   

Virginia Resources Authority, RB,

      

5.00%, 11/01/42

      1,870         2,177,166   
     

 

 

  
        5,080,077   
     

 

 

  

Washington – 4.2%

      

City of Seattle Washington, Refunding RB, Series A,

      

5.25%, 2/01/36

      1,375         1,607,444   

State of Washington, GO, Various Purpose, Series B,

      

5.25%, 2/01/36

      1,075         1,265,124   

Washington Higher Education Facilities Authority, Refunding RB, The University of Puget Sound Project,
Series A,

      

5.00%, 10/01/42

      5,000         5,579,950   
     

 

 

  
        8,452,518   
     

 

 

  

Wisconsin – 1.3%

      

Wisconsin Health & Educational Facilities Authority, RB, Ascension Health Alliance, Series D,

      

5.00%, 11/15/41

      1,880         2,117,425   

Wisconsin Health & Educational Facilities Authority, Refunding RB, Froedtert Health, Inc. Obligated Group,
Series A,

      

5.00%, 4/01/42

      475         533,815   
     

 

 

  
        2,651,240   
     

 

 

  

Total Municipal Bonds – 117.3%

         234,681,627   
     

 

 

  

 

    BLACKROCK MUNIHOLDINGS QUALITY FUND, INC.    JANUARY 31, 2013   3

Schedule of Investments (continued)    BlackRock MuniHoldings Quality Fund, Inc. (MUS)
   (Percentages shown are based on Net Assets)

 

Municipal Bonds Transferred to Tender Option Bond (TOB) Trusts(c)

    Par
(000)		      Value  

Alabama – 1.2%

      

Mobile Board of Water & Sewer Commissioners, RB (NPFGC),

      

5.00%, 1/01/31

    $ 2,120       $ 2,308,108   
     

 

 

  

California – 2.3%

      

Sequoia Union High School District California, GO, Refunding, Election of 2004, Series B (AGM),

      

5.50%, 7/01/35

      3,149         3,539,467   

University of California, Refunding RB, Limited Project, Series G,

      

5.00%, 5/15/37

      1,000         1,159,336   
     

 

 

  
        4,698,803   
     

 

 

  

Colorado – 3.1%

      

Colorado Health Facilities Authority, RB, Catholic Health, Series C-3 (AGM),

      

5.10%, 10/01/41

      5,610         6,118,154   
     

 

 

  

District of Columbia – 0.6%

      

District of Columbia Water & Sewer Authority, Refunding RB, Senior Lien, Series A,

      

6.00%, 10/01/35(d)

      1,040         1,262,574   
     

 

 

  

Florida – 7.7%

      

City of St. Petersburg Florida, Refunding RB (NPFGC),

      

5.00%, 10/01/35

      4,302         4,671,705   

County of Miami-Dade Florida, GO, Building Better Communities Program, Series B-1,

      

6.00%, 7/01/38

      7,500         8,867,775   

County of Miami-Dade Florida, RB, Transit System, Sales Surtax Revenue,

      

5.00%, 7/01/42

      1,000         1,125,400   

Lee County Housing Finance Authority, RB, Multi-County Program, Series A-2, AMT (Ginnie Mae),

      

6.00%, 9/01/40

      720         761,227   
     

 

 

  
        15,426,107   
     

 

 

  

Georgia – 2.1%

      

Augusta-Richmond County Georgia, RB, Water & Sewer (AGM),

      

5.25%, 10/01/34

      4,000         4,274,920   
     

 

 

  

Illinois – 1.4%

      

City of Chicago Illinois, Refunding RB, Second Lien (AGM),

      

5.25%, 11/01/33

      2,509         2,900,354   
     

 

 

  

Kentucky – 0.8%

      

Kentucky State Property & Building Commission, Refunding RB, Project No. 93 (AGC),

      

5.25%, 2/01/27

      1,406         1,625,442   
     

 

 

  

Massachusetts – 6.2%

      

Massachusetts School Building Authority, RB:

      

Senior, Series B, 5.00%, 10/15/41

      3,060         3,528,241   

Series A (AGM), 5.00%, 8/15/15(b)

      1,032         1,135,465   

Series A (AGM), 5.00%, 8/15/30

      6,976         7,675,709   
     

 

 

  
        12,339,415   
     

 

 

  

Nevada – 5.3%

      

Clark County Water Reclamation District, GO:

      

Limited Tax, 6.00%, 7/01/38

      5,000         6,041,750   

Series B, 5.50%, 7/01/29

      3,749         4,579,666   
     

 

 

  
        10,621,416   
     

 

 

  

New Jersey – 1.3%

      

New Jersey State Housing & Mortgage Finance Agency, RB, S/F Housing, Series CC,

      

5.25%, 10/01/29

      2,291         2,543,253   
     

 

 

  

New York – 10.4%

      

New York City Municipal Water Finance Authority, Refunding RB, Series FF,

      

5.00%, 6/15/45

      2,379         2,711,182   

New York City Transitional Finance Authority, RB:

      

Building Aid Revenue, Fiscal 2009, Series S-3, 5.25%, 1/15/39

      1,400         1,571,086   

Future Tax Secured, Fiscal 2012, Series E, Sub-Series E-1, 5.00%, 2/01/42

      1,760         2,021,955   

New York Liberty Development Corp., RB, 1 World Trade Center Port Authority Construction,

      

5.25%, 12/15/43

      4,530         5,211,875   

New York Liberty Development Corp., Refunding RB, 4 World Trade Center Project,

      

5.75%, 11/15/51

      2,660         3,155,771   

New York State Dormitory Authority, RB, General Purpose, Series C,

      

5.00%, 3/15/41

      5,325         6,046,378   
     

 

 

  
        20,718,247   
     

 

 

  

Puerto Rico – 1.0%

      

Puerto Rico Sales Tax Financing Corp., Refunding RB, Series C,

      

5.25%, 8/01/40

      1,820         1,979,869   
     

 

 

  

Texas – 1.9%

      

Waco Educational Finance Corp., Refunding RB, Baylor University,

      

5.00%, 3/01/43

      3,255         3,727,398   
     

 

 

  

Utah – 0.6%

      

City of Riverton Utah Hospital, RB, IHC Health Services Inc.,

      

5.00%, 8/15/41

      1,005         1,111,932   
     

 

 

  

 

4   BLACKROCK MUNIHOLDINGS QUALITY FUND, INC.    JANUARY 31, 2013    

Schedule of Investments (continued)    BlackRock MuniHoldings Quality Fund, Inc. (MUS)
   (Percentages shown are based on Net Assets)

 

Municipal Bonds Transferred to Tender Option Bond (TOB) Trusts(c)

    Par
(000)		      Value  

Washington – 3.8%

      

City of Bellevue Washington, GO, Refunding (NPFGC),

      

5.50%, 12/01/14(b)

    $ 4,002       $ 4,380,038   

University of Washington, Refunding RB, Series A,

      

5.00%, 7/01/41

      2,819         3,281,484   
     

 

 

  
        7,661,522   
     

 

 

  

Total Municipal Bonds Transferred to Tender Option Bond (TOB) Trusts – 49.7%

         99,317,514   
     

 

 

  

Total Long-Term Investments
(Cost – $304,036,490) – 167.0%

         333,999,141   
     

 

 

  

Short-Term Securities

    Shares         

Money Market Fund – 0.3%

      

FFI Institutional Tax-Exempt Fund,

      

0.01%(e)(f)

      693,667         693,667   
     

 

 

  

Short-Term Securities

    Par
(000)		         

Connecticut – 0.3%

      

Connecticut Housing Finance Authority, Refunding RB, VRDN, Housing Mortgage Finance Program, Sub-Series A-2 (JPMorgan Chase Bank NA SBPA),

      

0.12%, 2/01/13(g)

    $ 500         500,000   
     

 

 

  

Total Short-Term Securities
(Cost – $1,193,667) – 0.6%

         1,193,667   
     

 

 

  

Total Investments (Cost – $305,230,157*) – 167.6%

         335,192,808   

Other Assets Less Liabilities – 1.3%

         2,641,374   

Liability for TOB Trust Certificates, Including Interest Expense and Fees Payable – (25.4)%

         (50,781,775 ) 

VMTP Shares, at Liquidation Value – (43.5)%

         (87,000,000 ) 
     

 

 

  

Net Assets Applicable to Common Shares – 100.0%

       $ 200,052,407   
     

 

 

  

 

* As of January 31, 2013, gross unrealized appreciation and gross unrealized depreciation based on cost for federal income tax purposes were as follows:

 

Tax cost

    $ 254,496,508   
  

 

 

  

Gross unrealized appreciation

    $ 30,296,121   

Gross unrealized depreciation

      (354,418 ) 
  

 

 

  

Net unrealized appreciation

    $ 29,941,703   
  

 

 

  

Notes to Schedule of Investments

 

(a) Represents a zero-coupon bond. Rate shown reflects the current yield as of report date.

 

(b) US 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) Securities represent bonds transferred to a TOB in exchange for which the Fund acquired residual interest certificates. These securities serve as collateral in a financing transaction.

 

(d) All or a portion of security is subject to a recourse agreement, which may require the Fund to pay the liquidity provider in the event there is a shortfall between the TOB trust certificates and proceeds received from the sale of the security contributed to the TOB trust. In the case of a shortfall, the aggregate maximum potential amount the Fund could ultimately be required to pay under the agreements is $520,170.

 

(e) Investments in issuers considered to be an affiliate of the Fund during the period ended January 31, 2013, for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliate

    Shares Held at
April  30,
2012		      Net Activity      Shares Held at
January 31,
2013		      Income  

FFI Institutional Tax-Exempt Fund

      22,670         670,997         693,667       $ 40   

 

(f) Represents the current yield as of report date.

 

(g) Variable rate security. Rate shown is as of report date and maturity shown is the date the principal owed can be recovered through demand.

 

    BLACKROCK MUNIHOLDINGS QUALITY FUND, INC.    JANUARY 31, 2013   5

Schedule of Investments (continued)    BlackRock MuniHoldings Quality Fund, Inc. (MUS)
  

 

Portfolio Abbreviations

 

To simplify the listings of portfolio holdings in the Schedule of Investments, the names and descriptions of many of the securities have been abbreviated according to the following list:      AGC      Assured Guaranty Corp.    
     AGM      Assured Guaranty Municipal Corp.    
     AMT      Alternative Minimum Tax (subject to)    
     ARB      Airport Revenue Bonds    
     CAB      Capital Appreciation Bonds    
     COP      Certificates of Participation    
     EDA      Economic Development Authority    
     GARB      General Airport Revenue Bonds    
     GO      General Obligation Bonds    
     Ginnie Mae      Government National Mortgage Association    
     IDA      Industrial Development Authority    
     IDB      Industrial Development Board    
     ISD      Independent School District    
     NPFGC      National Public Finance Guarantee Corp.    
     PSF-GTD      Permanent School Fund Guaranteed    
     RB      Revenue Bonds    
     S/F      Single-Family    
     SBPA      Stand-by Bond Purchase Agreements    
     VRDN      Variable Rate Demand Notes    

 

•  

Fair Value Measurements – Various inputs are used in determining the fair value of investments. These inputs to valuation techniques are categorized into a disclosure hierarchy consisting of three broad levels for financial reporting purposes as follows:

 

  •  

Level 1 – unadjusted price quotations in active markets/exchanges for identical assets and liabilities that the 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 the Fund’s own assumptions used in determining the fair value of investments)

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 level in the fair value hierarchy within which the fair value measurement falls in its entirety is determined based on the lowest level input that is significant to the fair value measurement in its entirety.

Changes in valuation techniques may result in transfers into or out of an assigned level within the disclosure hierarchy. In accordance with the Fund’s policy, transfers between different levels of the fair value disclosure hierarchy are deemed to have occurred as of the beginning of the reporting period. The categorization of a value determined for investments is based on the pricing transparency of the investment and is not necessarily an indication of the risks associated with investing in those securities. For information about the Fund’s policy regarding valuation of investments and other significant accounting policies, please refer to the Fund’s most recent financial statements as contained in its semi-annual report.

The following table summarizes the Fund’s investments categorized in the disclosure hierarchy as of January 31, 2013:

 

      Level 1      Level 2      Level 3      Total  

Assets:

            

Investments:

            

Long-Term Investments1

      –       $ 333,999,141         –       $ 333,999,141   

Short-Term Securities

    $ 693,667         500,000         –         1,193,667   
  

 

 

     

 

 

     

 

 

     

 

 

  

Total

    $ 693,667       $ 334,499,141         –       $ 335,192,808   
  

 

 

     

 

 

     

 

 

     

 

 

  

 

1 

See above Schedule of Investments for values in each state or political subdivision.

 

6   BLACKROCK MUNIHOLDINGS QUALITY FUND, INC.    JANUARY 31, 2013    

Schedule of Investments (concluded)    BlackRock MuniHoldings Quality Fund, Inc. (MUS)
  

 

Certain of the Fund’s liabilities are held at carrying amount, which approximates fair value for financial reporting purposes. As of January 31, 2013, such liabilities are categorized within the disclosure hierarchy as follows:

 

      Level 1      Level 2     Level 3      Total  

Liabilities:

           

Bank overdraft

      —       $ (80,924 )      —       $ (80,924 ) 

TOB trust certificates

      —         (50,754,597 )      —         (50,754,597 ) 

VMTP Shares

      —         (87,000,000 )      —         (87,000,000 ) 
  

 

 

     

 

 

    

 

 

     

 

 

  

Total

      —       $ (137,835,521 )      —       $ (137,835,521 ) 
  

 

 

     

 

 

    

 

 

     

 

 

  

There were no transfers between levels during the period ended January 31, 2013.

 

    BLACKROCK MUNIHOLDINGS QUALITY FUND, INC.    JANUARY 31, 2013   7

Item 2    –    Controls and Procedures
2(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.
2(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 registrant’s last fiscal quarter that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting.
Item 3    –    Exhibits

Certifications – Attached hereto

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

BlackRock MuniHoldings Quality Fund, Inc.

    
By:  

/s/ John M. Perlowski

    
  John M. Perlowski    
  Chief Executive Officer (principal executive officer) of BlackRock MuniHoldings Quality Fund, Inc.

Date: March 26, 2013

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 MuniHoldings Quality Fund, Inc.
Date: March 26, 2013
By:  

/s/ Neal J. Andrews

    
  Neal J. Andrews    
  Chief Financial Officer (principal financial officer) of BlackRock MuniHoldings Quality Fund, Inc.
Date: March 26, 2013