BLACKROCK MUNIYIELD CALIFORNIA 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: 811-06499

Name of Fund: BlackRock MuniYield California Fund, Inc. (MYC)

Fund Address:    100 Bellevue Parkway, Wilmington, DE 19809

Name and address of agent for service: John M. Perlowski, Chief Executive Officer, BlackRock MuniYield

            California 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: 07/31/2019

Date of reporting period: 01/31/2019


Item 1 – Report to Stockholders


JANUARY 31, 2019

 

SEMI-ANNUAL REPORT (UNAUDITED)

  LOGO

 

BlackRock Muni New York Intermediate Duration Fund, Inc. (MNE)

BlackRock MuniYield Arizona Fund, Inc. (MZA)

BlackRock MuniYield California Fund, Inc. (MYC)

BlackRock MuniYield Investment Fund (MYF)

BlackRock MuniYield New Jersey Fund, Inc. (MYJ)

 

 

Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of each Fund’s shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports from BlackRock or from your financial intermediary, such as a broker-dealer or bank. Instead, the reports will be made available on a website, and you will be notified by mail each time a report is posted and provided with a website link to access the report.

You may elect to receive all future reports in paper free of charge. If you hold accounts directly with BlackRock, you can call Computershare at (800) 699-1236 to request that you continue receiving paper copies of your shareholder reports. If you hold accounts through a financial intermediary, you can follow the instructions included with this disclosure, if applicable, or contact your financial intermediary to request that you continue to receive paper copies of your shareholder reports. Please note that not all financial intermediaries may offer this service. Your election to receive reports in paper will apply to all funds advised by BlackRock Advisors, LLC or its affiliates, or all funds held with your financial intermediary, as applicable.

If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive electronic delivery of shareholder reports and other communications by contacting your financial intermediary, if you hold accounts through a financial intermediary. Please note that not all financial intermediaries may offer this service.

 

Not FDIC Insured • May Lose Value • No Bank Guarantee


The Markets in Review

Dear Shareholder,

In the 12 months ended January 31, 2019, concerns about a variety of political risks and a modest slowdown in global growth worked against the equity market, while the bond market delivered modest positive returns. Though the market’s appetite for risk remained healthy for most of the reporting period, risk-taking declined sharply later in the reporting period. As a result, bonds held their value better than stocks, which posted negative returns across the globe. Shorter-term, higher-quality securities led the bond market, and U.S. equities outperformed most international stock markets.

Volatility rose in emerging market stocks, as the rising U.S. dollar and higher interest rates in the U.S. disrupted economic growth abroad. U.S.-China trade relations and debt concerns adversely affected the Chinese stock market, while Turkey and Argentina became embroiled in currency crises, largely due to hyperinflation in both countries. An economic slowdown in Europe also led to negative performance for European equities.

Volatility in the U.S. equity market spiked in October, as a wide range of risks were brought to bear on markets, ranging from rising interest rates and slowing global growth to heightened trade tensions and political turmoil in several countries, including the United States. These risks manifested in a broad based sell-off in December, leading to the worst December performance on record since 1931.

By comparison, fixed income securities delivered modest positive returns with relatively low volatility. In fixed income markets, short-term U.S. Treasury interest rates rose the fastest, while longer-term rates were relatively unchanged. This led to positive returns for U.S. Treasuries and a substantial flattening of the yield curve. Although the credit fundamentals in corporate markets remained relatively solid, investment-grade and high-yield bonds trailed U.S. Treasuries.

The U.S. Federal Reserve (the “Fed”) increased short-term interest rates four times during the reporting period. The Fed also continued to reduce its balance sheet, gradually reversing the unprecedented stimulus measures it enacted after the financial crisis. By our estimation, the Fed’s neutral interest rate (the theoretical rate that is neither stimulative nor restrictive to the economy) is approximately 3.5%. The Fed funds rate is currently at 2.5%, which is stimulative to the economy. At its latest meeting in late January, the Fed left interest rates unchanged and signaled a slower pace of rate hikes in response to the global economic slowdown. Relatively low inflation gives the Fed room to maintain support for the economy until the economic data builds the case for changing interest rates.

Although fears of recession drove equity volatility higher at the end of 2018, we continue to believe the probability of recession in 2019 remains relatively low. Economic growth and global earnings are likely to slow somewhat in 2019 — the tax cut stimulus will be less pronounced, and the Fed’s rate hikes in 2018 will gain traction in 2019. Trade frictions look more baked into asset prices than a year ago, but markets may be overlooking European political risks. Consequently, we are cautious on European equities, as European unity remains tenuous with a history of flare-ups. We continue to prefer to take risk in U.S. and emerging market equities. Within U.S. equities, we believe that companies with high-quality earnings and strong balance sheets offer the most attractive risk/reward trade-off. We also favor short-term bonds over long-term bonds because they offer nearly equivalent yields with far lower volatility.

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 January 31, 2019
     6-month   12-month

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

  (3.00)%   (2.31)%

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

  (9.62)   (3.52)

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

  (7.80)   (12.51)

Emerging market equities
(MSCI Emerging Markets Index)

  (2.60)   (14.24)

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

  1.10   1.95

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

  4.20   3.21

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

  2.71   2.25

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

  1.86   3.08

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

  1.07   1.73
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  

Semi-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

     16  

Statements of Assets and Liabilities

     39  

Statements of Operations

     40  

Statements of Changes in Net Assets

     41  

Statements of Cash Flows

     46  

Financial Highlights

     47  

Notes to Financial Statements

     52  

Director and Officer Information

     61  

Additional Information

     62  

Glossary of Terms Used in this Report

     64  

 

 

          3  


Municipal Market Overview  For the Reporting Period Ended January 31, 2019

 

Municipal Market Conditions

Municipal bonds experienced positive performance during the period, despite challenged total returns during most of 2018 as interest rates moved higher on the back of continued Fed policy normalization, fiscal stimulus, strong economic growth, and increased U.S. Treasury issuance. Performance turned particularly strong late in the year, with interest rates rallying as the Fed began to indicate a pivot from forecast based to data driven policy and the potential for a slower pace of future rate hikes. During the period, demand for the asset class remained firm, although displayed some bouts of volatility. Broadly, investors favored the tax-exempt income, diversification, quality, and value of municipal bonds given that tax reform ultimately lowered the top individual tax rate just 2.6% while eliminating deductions. During the 12 months ended January 31, 2019, municipal bond funds experienced net inflows of approximately $2.7 billion (based on data from the Investment Company Institute).

 

 
For the same 12-month period, total new issuance underwhelmed from a historical perspective at $315 billion (below the $394 billion issued in the prior 12-month period), a direct result of the elimination of advanced refundings through the 2017 Tax Cuts and Jobs Act. This shift transitioned the market from an existing net positive supply environment to a much more favorable net negative supply environment in which reinvestment income (coupons, calls, and maturities) largely outstripped gross issuance and provided a powerful technical tailwind.   S&P Municipal Bond Index
  Total Returns as of January 31, 2019
    6 months: 1.86%
  12 months: 3.08%

A Closer Look at Yields

 

LOGO

From January 31, 2018 to January 31, 2019, yields on AAA-rated 30-year municipal bonds increased by 11 basis points (“bps”) from 2.91% to 3.02%, while 10-year rates decreased by 18 bps from 2.35% to 2.17% and 5-year rates decreased by 7 bps from 1.83% to 1.76% (as measured by Thomson Municipal Market Data). The municipal yield curve was nearly unchanged over the 12-month period with the spread between 2- and 30-year maturities bear steepening just 1 bp, which is significant given that the corresponding U.S. Treasury curve bear flattened 26 bps. (Bear steepening is the widening of the yield curve caused by long-term rates increasing at a faster rate than short-term rates. Bear flattened is a yield-rate environment in which short-term interest rates are increasing at a faster rate than long-term interest rates.) The municipal yield curve is now more than 2.5 times steeper than the U.S. Treasury curve.

During the same time period, on a relative basis, tax-exempt municipal bonds strongly outperformed U.S. Treasuries, driven by 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, incremental yield, and tax shelter 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 problems among a few issuers. Four of the five states with the largest amount of debt outstanding — California, New York, Texas and Florida — continue to exhibit improved credit fundamentals. However, several states with the largest unfunded pension liabilities are faced with elevated borrowing costs and difficult budgetary decisions. Across the country on the local level, property values support credit stability. Standard & Poor’s recent decision to remove its “negative” outlook on New Mexico underscores the improvement in state finances as it was the only remaining state with the designation. Revenue bonds continue to drive performance as investors continue to seek higher yield bonds in the tobacco sector. 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 January 31, 2019, 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    2019 BLACKROCK SEMI-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” or “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 January 31, 2019    BlackRock Muni New York Intermediate Duration Fund, Inc.

 

Fund Overview

BlackRock Muni New York Intermediate Duration Fund, Inc.’s (MNE) (the “Fund”) investment objective is to provide common shareholders with high current income exempt from U.S. federal income tax and New York State and New York City personal income taxes. The Fund seeks to achieve its investment objective by investing at least 80% of its assets in municipal obligations exempt from U.S. federal income tax (except that the interest may be subject to the federal alternative minimum tax) and New York State and New York City personal income taxes. Under normal market conditions, the Fund invests at least 75% of its assets in municipal obligations that are investment grade quality, or are considered by the Fund’s investment adviser to be of comparable quality, at the time of investment. Under normal market conditions, the Fund invests at least 80% of its assets in municipal obligations with a duration 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 New York Stock Exchange (“NYSE”)

  MNE

Initial Offering Date

  August 1, 2003

Yield on Closing Market Price as of January 31, 2019 ($12.83)(a)

  3.74%

Tax Equivalent Yield(b)

  7.42%

Current Monthly Distribution per Common Share(c)

  $0.0400

Current Annualized Distribution per Common Share(c)

  $0.4800

Economic Leverage as of January 31, 2019(d)

  41%

 

  (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 and state tax rate of 49.62%, 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 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 six months ended January 31, 2019 were as follows:

 

    Returns Based On  
     Market Price      NAV  

MNE(a)(b)

    4.53      1.87

Lipper Intermediate Municipal Debt Funds(c)

    2.45        1.50  

 

  (a) 

All returns reflect reinvestment of dividends and/or distributions at actual reinvestment prices.

 
  (b) 

The Fund’s discount to NAV narrowed 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:

After performing poorly through the first half of the period, municipal bonds recovered to post a positive total return for the full six months. The initial downturn was largely brought about by concerns that the Fed’s would raise interest rates aggressively in 2019. However, subsequent signs of slowing growth prompted investors to adjust their expectations in favor of more accommodative Fed policy, sparking a rally across the bond market from early November onward.

The New York municipal market finished somewhat behind the national indexes due primarily to elevated new-issue supply. While New York continues to benefit from a broad and diverse economic base, a tax revenue shortfall — possibly driven by changes stemming from the federal Tax Cuts and Jobs Act — had an adverse effect on investor sentiment. In addition to making revenue forecasting more of a challenge, the tax-law changes made New York’s tax structure less competitive relative to lower-tax states.

Income, which was enhanced by leverage, was the largest contributor to performance. However, the cost of leverage became more expensive during the period due to the Fed’s two interest rate increases.

Positions in short-dated maturities were top performers on a price basis, as yields fell the most for bonds with maturities of ten years and below. (Prices and yields move in opposite directions.)

At the sector level, positions in tax-backed local and education issues aided results. In both cases, holdings in higher-quality bonds were key contributors.

The Fund sought to manage interest rate risk using U.S. Treasury futures. Given that U.S. Treasury yields fell, as prices rose, this strategy detracted from the Fund’s return.

The Fund’s allocation to lower-quality securities, which generally underperformed higher-rated securities, was an additional detractor from Fund performance.

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    2019 BLACKROCK SEMI-ANNUAL REPORT TO SHAREHOLDERS


Fund Summary  as of January 31, 2019 (continued)    BlackRock Muni New York Intermediate Duration Fund, Inc.

 

Market Price and Net Asset Value Per Share Summary

 

     01/31/19     07/31/18      Change      High      Low  

Market Price

  $ 12.83     $ 12.57        2.07    $ 13.07      $ 12.01  

Net Asset Value

    14.90       14.98        (0.53      14.98        14.50  

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

 

LOGO

Overview of the Fund’s Total Investments *

 

SECTOR ALLOCATION

 

Sector   01/31/19     07/31/18  

Education

    24     22

County/City/Special District/School District

    23       22  

Transportation

    18       18  

State

    10       15  

Health

    10       10  

Utilities

    7       6  

Corporate

    5       4  

Tobacco

    2       2  

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 (b)

 

Calendar Year Ended December 31,

       

2019

    9

2020

    5  

2021

    13  

2022

    4  

2023

    14  

 

  (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   01/31/19     07/31/18  

AAA/Aaa

    7     13

AA/Aa

    46       40  

A

    27       27  

BBB/Baa

    13       13  

BB/Ba

    1       1  

B/B

    1        

N/R

    5       6  

 

  (a) 

For financial reporting purposes, credit quality ratings shown above reflect the highest rating assigned by either Standard & Poor’s (“S&P”) or Moody’s Investors Service (“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      7  


Fund Summary  as of January 31, 2019    BlackRock MuniYield Arizona Fund, Inc.

 

Fund Overview

BlackRock MuniYield Arizona Fund, Inc.’s (MZA) (the “Fund”) investment objective is to provide shareholders with as high a level of current income exempt from U.S. federal and Arizona 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 obligations exempt from U.S. federal income taxes (except that the interest may be subject to the federal alternative minimum tax) and Arizona income taxes. Under normal market conditions, the Fund expects to invest at least 75% of its assets in municipal obligations that are investment grade quality, or are considered by the Fund’s 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 NYSE

  MZA

Initial Offering Date

  October 29, 1993

Yield on Closing Market Price as of January 31, 2019 ($12.93)(a)

  4.36%

Tax Equivalent Yield(b)

  7.98%

Current Monthly Distribution per Common Share(c)

  $0.0470

Current Annualized Distribution per Common Share(c)

  $0.5640

Economic Leverage as of January 31, 2019(d)

  40%

 

  (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 and state tax rate of 45.34%, 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 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 six months ended January 31, 2019 were as follows:

 

    Returns Based On  
     Market Price      NAV  

MZA(a)(b)

    (8.40 )%       1.42

Lipper Other State Municipal Debt Funds(c)

    1.42        1.34  

 

  (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:

After performing poorly through the first half of the period, municipal bonds recovered to post a positive total return for the full six months. The initial downturn was largely brought about by concerns that the Fed would raise interest rates aggressively in 2019. However, subsequent signs of slowing growth prompted investors to adjust their expectations in favor of more accommodative Fed policy, sparking a rally across the bond market from early November onward.

Arizona municipal bonds slightly outperformed the national market. Issuance of Arizona municipal debt remained relatively light, which helped support performance. Arizona’s conservative debt profile and shorter average maturity further aided results. The state’s economy continued to improve on the strength of positive migration trends, as its population is projected to increase at the third-fastest pace in the country.

Portfolio income, enhanced by leverage, made the largest contribution to the Fund’s return. The Fund’s position in bonds with five- to 10-year maturities also contributed, as yields in this area declined. In contrast, yields for both short- and long-term issues were largely unchanged. (Prices and yields move in opposite directions.)

At the sector level, positions in utilities issues were key contributors to Fund performance.

The Fund sought to manage interest rate risk using U.S. Treasury futures. Given that U.S. Treasury yields fell, as prices rose, this strategy detracted from the Fund’s return.

One of the Fund’s holdings in the corporate municipal sector detracted from the Fund’s results, as the issuer’s credit rating was downgraded. The Fund’s exposure to lower-rated bonds (generally BBB and below) was also a negative factor as yield spreads widened during the period.

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.

 

 

8    2019 BLACKROCK SEMI-ANNUAL REPORT TO SHAREHOLDERS


Fund Summary  as of January 31, 2019 (continued)    BlackRock MuniYield Arizona Fund, Inc.

 

Market Price and Net Asset Value Per Share Summary

 

     01/31/19      07/31/18      Change      High      Low  

Market Price

  $ 12.93      $ 14.45        (10.52 )%     $ 14.45      $ 11.90  

Net Asset Value

    13.93        14.06        (0.92      14.06        13.55  

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

 

LOGO

Overview of the Fund’s Total Investments *

 

SECTOR ALLOCATION

 

Sector   01/31/19     07/31/18  

Utilities

    31     27

Education

    24       22  

County/City/Special District/School District

    16       19  

Corporate

    13       12  

Health

    12       12  

State

    2       5  

Transportation

    2       2  

Tobacco

          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,

       

2019

    8

2020

    6  

2021

    9  

2022

    7  

2023

    7  

 

  (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   01/31/19     07/31/18  

AAA/Aaa

    3     4

AA/Aa

    56       58  

A

    20       16  

BBB/Baa

    11       11  

BB/Ba

    6       7  

N/R

    4       4  

 

  (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      9  


Fund Summary  as of January 31, 2019    BlackRock MuniYield California Fund, Inc.

 

Fund Overview

BlackRock MuniYield California Fund, Inc.’s (MYC) (the “Fund”) investment objective is to provide shareholders with as high a level of current income exempt from U.S. federal and California 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 obligations exempt from U.S. federal income taxes (except that the interest may be subject to the federal alternative minimum tax) and California income taxes. Under normal market conditions, the Fund invests primarily in long-term municipal obligations that are investment grade quality, or are considered by the Fund’s investment adviser to be of comparable quality, at the time of investment. The Fund may invest up to 20% of its total assets in securities that are rated below investment grade, or are considered by the Fund’s investment adviser to be of comparable quality, at the time of purchase. 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

  MYC

Initial Offering Date

  February 28, 1992

Yield on Closing Market Price as of January 31, 2019 ($13.16)(a)

  4.74%

Tax Equivalent Yield(b)

  10.33%

Current Monthly Distribution per Common Share(c)

  $0.0520

Current Annualized Distribution per Common Share(c)

  $0.6240

Economic Leverage as of January 31, 2019(d)

  42%

 

  (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 and state tax rate of 54.10%, 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 monthly distribution per Common Share, declared on March 1, 2019, was decreased to $0.0480 per share. The current yield on closing market price, tax equivalent yield, current monthly distribution per Common Share and current annualized distribution per Common Share do not reflect the new distribution rate. The new distribution rate is not constant and is subject to change in the future.

 
  (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 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 six months ended January 31, 2019 were as follows:

 

    Returns Based On  
     Market Price      NAV  

MYC(a)(b)

    3.36      0.98

Lipper California Municipal Debt Funds(c)

    2.77        0.80  

 

  (a) 

All returns reflect reinvestment of dividends and/or distributions at actual reinvestment prices.

 
  (b) 

The Fund’s discount to NAV narrowed 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:

After performing poorly through the first half of the period, municipal bonds recovered to post a positive total return for the full six months. The initial downturn was largely brought about by concerns that the Fed would raise interest rates aggressively in 2019. However, subsequent signs of slowing growth prompted investors to adjust their expectations in favor of more accommodative Fed policy, sparking a rally across the bond market from early November onward.

California municipal bonds lagged the national market. However, the state’s debt gained a measure of support from strong demand among retail investors looking for tax-exempt income in a state with the country’s most punitive income tax regime. The credit quality of state and local authorities remained consistent, but investors were alert for any changes in fiscal responsibility demonstrated by the new governor and his administration.

In a low-return environment, income was a key contributor to the Fund’s return. The Fund’s use of leverage aided performance by augmenting the contribution from income.

The Fund sought to manage interest rate risk using U.S. Treasury futures. Given that U.S. Treasury yields fell, as prices rose, this strategy detracted from the Fund’s return.

The Fund benefited from its positions in higher-quality issues and bonds with maturities between six and seven years. Conversely, its positions in the tobacco sector detracted.

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    2019 BLACKROCK SEMI-ANNUAL REPORT TO SHAREHOLDERS


Fund Summary  as of January 31, 2019 (continued)    BlackRock MuniYield California Fund, Inc.

 

Market Price and Net Asset Value Per Share Summary

 

     01/31/19     07/31/18      Change      High      Low  

Market Price

  $ 13.16     $ 13.19        (0.23 )%     $ 13.80      $ 12.21  

Net Asset Value

    14.73       15.11        (2.51      15.11        14.52  

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

 

LOGO

Overview of the Fund’s Total Investments *

 

SECTOR ALLOCATION

 

Sector   01/31/19     07/31/18  

County/City/Special District/School District

    33     31

Education

    21       24  

Health

    15       15  

Transportation

    10       11  

State

    9       8  

Utilities

    8       6  

Tobacco

    3       3  

Housing

    1       1  

Corporate

          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,

       

2019

    12

2020

    6  

2021

    9  

2022

    2  

2023

    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   01/31/19     07/31/18  

AAA/Aaa

    7     6

AA/Aa

    71       70  

A

    17       16  

BBB/Baa

    2       2  

BB/Ba

    1       1  

B/B(b)

          5  

N/R(b)

    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.

 
  (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 January 31, 2019 and July 31, 2018, 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      11  


Fund Summary  as of January 31, 2019    BlackRock MuniYield Investment Fund

 

Fund Overview

BlackRock MuniYield Investment Fund’s (MYF) (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 obligations exempt from U.S. federal income taxes (except that the interest may be subject to the federal alternative minimum tax). Under normal market conditions, the Fund primarily invests in municipal bonds that are investment grade quality, or are considered by the Fund’s investment adviser to be of comparable quality, at the time of investment. The Fund may invest up to 20% of its total assets in securities that are rated below investment grade, or are considered by the Fund’s investment adviser to be of comparable quality, at the time of purchase. 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

  MYF

Initial Offering Date

  February 28, 1992

Yield on Closing Market Price as of January 31, 2019 ($13.52)(a)

  5.50%

Tax Equivalent Yield(b)

  9.29%

Current Monthly Distribution per Common Share(c)

  $0.0620

Current Annualized Distribution per Common Share(c)

  $0.7440

Economic Leverage as of January 31, 2019(d)

  68%

 

  (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 40.80%, 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 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 six months ended January 31, 2019 were as follows:

 

    Returns Based On  
     Market Price      NAV  

MYF(a)(b)

    1.70      0.53

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

    2.46        0.94  

 

  (a) 

All returns reflect reinvestment of dividends and/or distributions at actual reinvestment prices.

 
  (b) 

The Fund’s discount to NAV narrowed 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:

After performing poorly through the first half of the period, municipal bonds recovered to post a positive total return for the full six months. The initial downturn was largely brought about by concerns that the Fed would raise interest rates aggressively in 2019. However, subsequent signs of slowing growth prompted investors to adjust their expectations in favor of more accommodative Fed policy, sparking a rally across the bond market from early November onward.

Income, which was enhanced by leverage, was the largest contributor to Fund performance. However, the cost of leverage became more expensive during the period due to the Fed’s two interest rate increases.

The Fund’s position in the housing sector, which has an above-average sensitivity to the direction of bond yields, contributed to Fund results. Conversely, its allocation to the tobacco sector detracted.

The Fund’s yield curve positioning hurt performance, largely as a result of an underweight in the outperforming five- to ten-year maturity area.

The Fund sought to manage interest rate risk using U.S. Treasury futures. Given that U.S. Treasury yields fell, as prices rose, this strategy detracted from the Fund’s return.

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.

 

 

12    2019 BLACKROCK SEMI-ANNUAL REPORT TO SHAREHOLDERS


Fund Summary  as of January 31, 2019 (continued)    BlackRock MuniYield Investment Fund

 

Market Price and Net Asset Value Per Share Summary

 

     01/31/19      07/31/18      Change      High      Low  

Market Price

  $ 13.52      $ 13.69        (1.24 )%     $ 14.84      $ 12.59  

Net Asset Value

    13.95        14.29        (2.38      14.29        13.76  

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

 

LOGO

Overview of the Fund’s Total Investments *

 

SECTOR ALLOCATION

 

Sector   01/31/19     07/31/18  

Transportation

    25     25

Health

    19       17  

County/City/Special District/School District

    18       19  

Utilities

    11       14  

State

    8       7  

Housing

    6       3  

Tobacco

    5       5  

Education

    5       7  

Corporate

    3       3  

 

   

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,

       

2019

    24

2020

    11  

2021

    16  

2022

    4  

2023

    12  

 

  (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   01/31/19     07/31/18  

AAA/Aaa

    4     8

AA/Aa

    48       47  

A

    22       21  

BBB/Baa

    11       10  

BB/Ba

    2       4  

B/B

    4       4  

N/R(b)

    9       6  

 

  (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 not-rated 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 January 31, 2019, and July 31, 2018, the market value of unrated securities deemed by the investment adviser to be investment grade represents 1% and less than 1%, respectively, of the Fund’s total investments.

 
 

 

 

FUND SUMMARY      13  


Fund Summary  as of January 31, 2019    BlackRock MuniYield New Jersey Fund, Inc.

 

Fund Overview

BlackRock MuniYield New Jersey Fund, Inc.’s (MYJ) (the “Fund”) investment objective is to provide shareholders with as high a level of current income exempt from U.S. federal income taxes and New Jersey personal income tax 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 obligations exempt from U.S. federal income taxes (except that the interest may subject to the federal alternative minimum tax) and New Jersey personal income taxes. Under normal market conditions, the Fund invests primarily in long-term municipal obligations that are investment grade quality, or are considered by the Fund’s investment adviser to be of comparable quality, at the time of investment. The Fund may invest up to 20% of its total assets in securities that are rated below investment grade, or are considered by the Fund’s investment adviser to be of comparable quality, at the time of purchase. 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

  MYJ

Initial Offering Date

  May 1, 1992

Yield on Closing Market Price as of January 31, 2019 ($13.60)(a)

  5.34%

Tax Equivalent Yield(b)

  11.02%

Current Monthly Distribution per Common Share(c)

  $0.0605

Current Annualized Distribution per Common Share(c)

  $0.7260

Economic Leverage as of January 31, 2019(d)

  40%

 

  (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 and state tax rate of 51.55%, 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 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 six months ended January 31, 2019 were as follows:

 

    Returns Based On  
     Market Price      NAV  

MYJ(a)(b)

    3.46      1.65

Lipper New Jersey Municipal Debt Funds(c)

    4.02        1.61  

 

  (a) 

All returns reflect reinvestment of dividends and/or distributions at actual reinvestment prices.

 
  (b) 

The Fund’s discount to NAV narrowed 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:

After performing poorly through the first half of the period, municipal bonds recovered to post a positive total return for the full six months. The initial downturn was largely brought about by concerns that the Fed would raise interest rates aggressively in 2019. However, subsequent signs of slowing growth prompted investors to adjust their expectations in favor of more accommodative Fed policy, sparking a rally across the bond market from early November onward.

The credit ratings and yield spreads on New Jersey’s debt continued to reflect the state’s high unfunded pension liabilities. In addition, slowing revenues created challenges in balancing the state’s budget for the 2020 fiscal year.

The Fund’s positions in the state tax-backed, local tax-backed and transportation sectors contributed to Fund performance. Its allocation to the tobacco sector, while limited, detracted.

The Fund’s allocation to higher-rated issues, which outpaced lower-quality bonds, were contributors.

Income made a meaningful contribution to performance relative to price appreciation. The Fund’s use of leverage augmented the contribution from income.

The Fund sought to manage interest rate risk using U.S. Treasury futures. Given that U.S. Treasury yields fell, as prices rose, this strategy detracted from the Fund’s return.

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    2019 BLACKROCK SEMI-ANNUAL REPORT TO SHAREHOLDERS


Fund Summary  as of January 31, 2019 (continued)    BlackRock MuniYield New Jersey Fund, Inc.

 

Market Price and Net Asset Value Per Share Summary

 

     01/31/19      07/31/18      Change      High      Low  

Market Price

  $ 13.60      $ 13.51        0.67    $ 13.64      $ 12.54  

Net Asset Value

    15.40        15.57        (1.09      15.57        15.09  

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

 

LOGO

Overview of the Fund’s Total Investments *

 

SECTOR ALLOCATION

 

Sector   01/31/19     07/31/18  

Transportation

    36     37

County/City/Special District/School District

    19       18  

Education

    17       15  

State

    8       10  

Corporate

    7       7  

Health

    7       6  

Housing

    3       3  

Tobacco

    2       3  

Utilities

    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,

       

2019

    10

2020

    6  

2021

    17  

2022

    11  

2023

    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   01/31/19     07/31/18  

AAA/Aaa

    7     4

AA/Aa

    29       33  

A

    22       24  

BBB/Baa

    31       30  

BB/Ba

    6       6  

N/R (b)

    5       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 not-rated 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 January 31, 2019 and July 31, 2018, the market value of unrated securities deemed by the investment adviser to be investment grade represents less than 1% of the Fund’s total investments.

 
 

 

 

FUND SUMMARY      15  


Schedule of Investments  (unaudited)

January 31, 2019

  

BlackRock Muni New York Intermediate Duration Fund, Inc. (MNE)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  

Municipal Bonds — 129.3%

 

New York — 129.3%

 

Corporate — 7.9%  

Build NYC Resource Corp., Refunding RB:

 

Manhattan College Project, 5.00%, 08/01/33

  $ 275     $ 315,293  

Pratt Paper, Inc. Project, AMT,
4.50%, 01/01/25(a)

    500       536,675  

City of New York Industrial Development Agency, Refunding RB, Transportation Infrastructure Properties LLC, Series A, AMT, 5.00%, 07/01/22

    850       928,013  

New York Transportation Development Corp., ARB, Delta Air Lines, Inc. LaGuardia Airport Terminals C&D Redevelopment Project, AMT, 5.00%, 01/01/33

    1,000       1,125,330  

New York Transportation Development Corp., Refunding ARB, American Airlines, Inc., AMT, 5.00%, 08/01/26

    1,000       1,046,690  

Niagara Area Development Corp., Refunding RB, Covanta Project, Series B, 3.50%, 11/01/24(a)

    1,000       989,700  
   

 

 

 
      4,941,701  
County/City/Special District/School District — 23.0%  

City of Glen Cove New York, GO:

   

Series A, 5.00%, 01/01/25

    195       220,816  

Series A, 5.00%, 01/01/26

    105       119,982  

Refunding, 5.00%, 01/15/25

    980       1,110,546  

Refunding, 5.00%, 01/15/26

    520       594,584  

City of New York, GO, Refunding, Series E, 5.00%, 08/01/30

    1,250       1,386,588  

City of New York, GO:

   

Sub-Series A-1, 5.00%, 08/01/33

    700       781,802  

Sub-Series I-1, 5.50%, 04/01/19(b)

    1,500       1,509,465  

Sub-Series I-1, 5.13%, 04/01/25

    750       753,998  

City of New York Industrial Development Agency, RB, PILOT, Queens Baseball Stadium (AMBAC), 5.00%, 01/01/31

    1,000       1,002,880  

City of New York Transitional Finance Authority Future Tax Secured Revenue, RB, Future Tax Secured:

   

Subordinate Bonds, 5.00%, 02/01/34

    600       692,076  

Sub-Series A1, 5.00%, 08/01/33

    300       355,500  

County of Nassau New York, GO, Series A (AGM),
5.00%, 04/01/32

    1,000       1,167,800  

County of Nassau New York, GO, Refunding, Series C, 5.00%, 10/01/29

    500       586,980  

Haverstraw-Stony Point Central School District, GO, Refunding, (AGM), 5.00%, 10/15/33

    300       336,570  

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

   

5.75%, 02/15/21(b)

    615       665,399  

5.75%, 02/15/47

    385       413,505  

New York Liberty Development Corp., Refunding RB, 4 World Trade Center Project, 5.00%, 11/15/31

    1,000       1,073,410  

State of New York Dormitory Authority, RB, Haverstraw King’s Daughters Public Library, 5.00%, 07/01/26

    1,015       1,090,201  

Town of Oyster Bay New York, GOL, New York Public Improvement, 4.00%, 02/15/24

    1,500       1,601,340  
   

 

 

 
      15,463,442  
Education — 39.2%  

Amherst Development Corp., Refunding RB, University at Buffalo Foundation Faculty-Student Housing Corp., Series A (AGM),
4.00%, 10/01/20(b)

    1,000       1,038,440  

Build NYC Resource Corp., RB, Inwood Academy for Leadership Charter School Project, Series A, 4.88%, 05/01/31(a)

    750       755,775  

Build NYC Resource Corp., Refunding RB:

   

Ethical Culture Fieldston School Project, 5.00%, 06/01/30

    385       439,039  

Manhattan College Project, 5.00%, 08/01/35

    1,000       1,137,700  

The Packer Collegiate Institute Project, 5.00%, 06/01/35

    250       281,360  

City of New York Trust for Cultural Resources, Refunding RB, American Museum of Natural History, Series A,
5.00%, 07/01/32

    500       570,460  
Security   Par
(000)
    Value  
Education (continued)  

Counties of Buffalo & Erie New York Industrial Land Development Corp., Refunding RB:

   

Buffalo State College Foundation Housing, 6.00%, 10/01/31

  $ 1,000     $ 1,085,600  

The Charter School for Applied Technologies Project, Series A, 4.50%, 06/01/27

    1,000       1,073,880  

County of Monroe New York Industrial Development Corp., Refunding RB, Series A, 5.00%, 07/01/23(b)

    1,000       1,141,400  

County of Nassau New York Industrial Development Agency, Refunding RB, New York Institute of Technology Project, Series A, 5.00%, 03/01/20(b)

    1,000       1,034,120  

County of Schenectady New York Capital Resource Corp., Refunding RB, Union College, 5.00%, 07/01/32

    500       544,345  

State of New York Dormitory Authority, RB:

   

Bid Group 3, Series A, 5.00%, 03/15/33

    1,000       1,178,500  

Convent of the Sacred Heart (AGM), 5.00%, 11/01/21

    120       128,753  

Fordham University, Series A, 5.25%, 07/01/21(b)

    500       543,065  

Icahn School of Medicine at Mount Sinai, Series A,
5.00%, 07/01/32

    1,000       1,131,350  

Mount Sinai School of Medicine, 5.50%, 07/01/19(b)

    1,000       1,015,660  

Mount Sinai School of Medicine, Series A (NPFGC),
5.15%, 07/01/24

    250       281,063  

State University Dormitory Facilities, Series A,
5.00%, 07/01/33

    1,000       1,180,830  

Touro College & University System Obligation Group, Series A, 4.13%, 01/01/30

    1,000       985,710  

State of New York Dormitory Authority, Refunding RB:

   

Fordham University, 5.00%, 07/01/29

    375       424,575  

Fordham University, 5.00%, 07/01/30

    300       339,171  

Pace University, Series A, 5.00%, 05/01/27

    980       1,055,048  

Series B, 5.00%, 07/01/31

    1,500       1,721,700  

Series E, 5.25%, 03/15/33

    500       582,995  

Series L, 5.00%, 01/01/32

    1,750       2,065,245  

State University Dormitory Facilities, Series A,
5.25%, 07/01/30

    1,050       1,187,602  

The Culinary Institute of America, 5.00%, 07/01/28

    500       539,735  

Troy Capital Resource Corp., Refunding RB, 5.00%, 08/01/32

    1,000       1,129,330  
   

 

 

 
      24,592,451  
Health — 16.3%  

Build NYC Resource Corp., Refunding RB, New York Methodist Hospital Project, 5.00%, 07/01/30

    500       554,575  

County of Dutchess New York Industrial Development Agency, RB, Vassar Brothers Medical Center (AGC), 5.00%, 04/01/21

    215       225,716  

County of Dutchess New York Local Development Corp., Refunding RB, Health Quest System, Inc., Series A (AGM),
5.25%, 07/01/25

    1,000       1,044,460  

County of Monroe Industrial Development Corp., RB, Rochester General Hospital Project, 5.00%, 12/01/29

    660       765,904  

County of Westchester New York Healthcare Corp., Refunding RB, Senior Lien:

   

Remarketing, Series A, 5.00%, 11/01/24

    910       970,387  

Remarketing, Series A, 5.00%, 11/01/30

    580       610,444  

Series B, 6.00%, 11/01/20(b)

    205       220,094  

Series B, 6.00%, 11/01/30

    35       37,222  

County of Westchester New York Local Development Corp., Refunding RB:

   

Kendal On Hudson Project, 4.00%, 01/01/23

    250       261,027  

Kendal On Hudson Project, 5.00%, 01/01/28

    875       928,769  

Westchester Medical Center, 5.00%, 11/01/34

    500       545,295  

State of New York Dormitory Authority, RB, Series A(b):

   

New York State Association for Retarded Children, Inc.,
5.30%, 07/01/19

    450       456,682  

New York University Hospitals Center, 5.00%, 07/01/20

    1,000       1,046,570  
 

 

 

16    2019 BLACKROCK SEMI-ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (unaudited) (continued)

January 31, 2019

  

BlackRock Muni New York Intermediate Duration Fund, Inc. (MNE)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Health (continued)  

State of New York Dormitory Authority, Refunding RB:

   

Mount Sinai Hospital Series A, 4.25%, 07/01/23

  $ 250     $ 257,770  

North Shore-Long Island Jewish Obligated Group, Series A, 5.00%, 05/01/21(b)

    500       536,815  

North Shore-Long Island Jewish Obligated Group, Series A, 5.00%, 05/01/32

    1,270       1,425,842  

Orange Regional Medical Center, 5.00%, 12/01/27(a)

    100       115,270  

Orange Regional Medical Center, 5.00%, 12/01/28(a)

    200       229,108  
   

 

 

 
      10,231,950  
Housing — 1.9%  

City of New York Housing Development Corp., RB, M/F Housing, Series B1, 5.25%, 07/01/30

    500       554,400  

Yonkers New York Industrial Development Agency, RB, Sacred Heart Association Project, Series A, AMT (SONYMA),
4.80%, 10/01/26

    625       626,688  
   

 

 

 
      1,181,088  
State — 7.2%  

City of New York Transitional Finance Authority, BARB, Fiscal 2015, Series S-1, 5.00%, 07/15/37

    1,140       1,270,553  

State of New York Thruway Authority, Refunding RB, Series A-1, 5.00%, 04/01/19(b)

    1,000       1,005,520  

State of New York Urban Development Corp., Refunding RB, Personal Income Tax, Series A, 5.00%, 03/15/35

    1,990       2,256,819  
   

 

 

 
      4,532,892  
Tobacco — 4.1%  

County of Niagara New York Tobacco Asset Securitization Corp., Refunding RB, Asset-Backed, 5.25%, 05/15/34

    500       526,780  

New York Counties Tobacco Trust, Refunding RB, Tobacco Settlement Pass-Through Bonds, Series B:

   

5.00%, 06/01/25

    845       940,637  

5.00%, 06/01/28

    90       99,141  

5.00%, 06/01/29

    105       115,165  

TSASC, Inc., Refunding RB, Series A, 5.00%, 06/01/30

    775       865,404  
   

 

 

 
      2,547,127  
Transportation — 19.0%  

Metropolitan Transportation Authority, RB:

   

Series A, 5.00%, 11/15/21(b)

    1,000       1,092,370  

Series A-1, 5.25%, 11/15/23(b)

    500       581,905  

Series B, 5.25%, 11/15/33

    1,000       1,115,800  

Series B (NPFGC), 5.25%, 11/15/19

    860       883,142  

Sub-Series B-1, 5.00%, 11/15/21(b)

    460       502,490  

Sub-Series B-4, 5.00%, 11/15/21(b)

    300       327,711  

Sub-Series D-1, 5.25%, 11/15/44

    225       252,180  

Port Authority of New York & New Jersey, ARB, JFK International Air Terminal LLC Project, Series 8, 5.00%, 12/01/20

    685       713,572  

Port Authority of New York & New Jersey, Refunding RB, 178th Series, AMT, 5.00%, 12/01/32

    1,000       1,111,010  

State of New York Thruway Authority, Refunding RB, General:

   

Series I, 5.00%, 01/01/37

    660       703,316  

Series K, 5.00%, 01/01/32

    1,035       1,174,456  

Triborough Bridge & Tunnel Authority, RB:

   

Series B, 5.00%, 11/15/31

    2,005       2,336,166  

Series B-3, 5.00%, 11/15/33

    500       579,530  

Triborough Bridge & Tunnel Authority, Refunding RB, Series A, 5.00%, 01/01/22(b)

    500       548,265  
   

 

 

 
      11,921,913  
Utilities — 9.0%  

Long Island Power Authority, RB, Electric System,
5.00%, 09/01/33

    1,000       1,177,200  
Security   Par
(000)
    Value  
Utilities (continued)  

Long Island Power Authority, Refunding RB, Electric System, Series A:

   

5.50%, 04/01/19(b)

  $ 500     $ 503,115  

5.00%, 09/01/34

    1,000       1,121,580  

State of New York Environmental Facilities Corp., RB, Green Bond, Series C, 5.00%, 08/15/37

    575       667,558  

State of New York Environmental Facilities Corp., Refunding RB, NYC Municipal Water Finance Authority Project, 2nd Resolution, Series B, 5.00%, 06/15/31

    1,000       1,070,580  

Utility Debt Securitization Authority, Refunding RB, New York Restructuring, Series E, 5.00%, 12/15/32

    1,000       1,125,510  
   

 

 

 
      5,665,543  
   

 

 

 

Total Municipal Bonds — 129.3%
(Cost — $78,208,130)

 

    81,078,107  
   

 

 

 

Municipal Bonds Transferred to Tender Option Bond
Trusts(c) — 37.1%

 

New York — 37.1%

 

County/City/Special District/School District — 16%  

City of New York, GO:

   

Sub-Series 1-I, 5.00%, 03/01/32

    991       1,113,148  

Sub-Series G-1, 5.00%, 04/01/29

    750       818,258  

Refunding Series E, 5.00%, 08/01/19(b)

    174       176,765  

Refunding Series E, 5.00%, 08/01/27

    426       432,475  

City of New York Convention Center Development Corp., Refunding RB, Hotel Unit Fee Secured, 5.00%, 11/15/32

    3,540       4,060,150  

City of New York Transitional Finance Authority Future Tax Secured Revenue, RB, Future Tax Secured Subordinate Bonds, SubSeries B-1, 5.00%, 08/01/36

    3,001       3,421,123  
   

 

 

 
      10,021,919  
State — 8%  

Sales Tax Asset Receivable Corp., Refunding RB, Fiscal 2015, Series A, 5.00%, 10/15/31

    990       1,133,085  

State of New York Dormitory Authority, Refunding RB, Series A, 5.00%, 03/15/36(d)

    1,995       2,272,644  

State of New York Urban Development Corp., RB, Personal Income Tax, Series A-1, 5.00%, 03/15/32

    1,499       1,661,599  
   

 

 

 
      5,067,328  
Transportation — 10.4%  

Metropolitan Transportation Authority, RB, Sub-Series D-1,
5.00%, 11/15/39

    3,510       3,827,304  

Metropolitan Transportation Authority, Refunding RB, Series B, 5.25%, 11/15/19(b)

    749       770,491  

Port Authority of New York & New Jersey, Refunding ARB:

   

178th Series, AMT, 5.00%, 12/01/32

    991       1,099,277  

Consolidated, Series 169th, 5.00%, 10/15/26

    750       804,019  
   

 

 

 
      6,501,091  
Utilities — 2.7%  

City of New York Municipal Water Finance Authority, Refunding RB, Water & Sewer System, 2nd General Resolution, Fiscal 2011, Series HH, 5.00%, 06/15/32

    1,560       1,666,725  
   

 

 

 

Total Municipal Bonds Transferred to Tender Option Bond Trusts — 37.1%
(Cost — $22,629,591)

 

    23,257,063  
   

 

 

 

Total Long-Term Investments — 166.4%
(Cost — $100,837,721)

 

    104,335,170  
   

 

 

 
 

 

 

SCHEDULES OF INVESTMENTS      17  


Schedule of Investments  (unaudited) (continued)

January 31, 2019

  

BlackRock Muni New York Intermediate Duration Fund, Inc. (MNE)

(Percentages shown are based on Net Assets)

 

     Shares     Value  
Short-Term Securities — 0.5%  

BlackRock Liquidity Funds New York Money Fund Portfolio, 1.13%(e)(f)

    357,604     $ 357,604  
   

 

 

 

Total Short-Term Securities — 0.5%
(Cost — $357,604)

 

    357,604  
   

 

 

 

Total Investments — 166.9%
(Cost — $101,195,325)

 

    104,692,774  

Other Assets Less Liabilities — 1.5%

 

    909,991  

Liability for TOB Trust Certificates, Including Interest Expense and Fees Payable — (21.4)%

 

    (13,420,228

VRDP Shares at Liquidation Value, Net of Deferred Offering
Costs — (47.0)%

 

    (29,463,685
   

 

 

 

Net Assets Applicable to Common Shares — 100.0%

 

  $ 62,718,852  
   

 

 

 
(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) 

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 agreement, which expires on September 15, 2024, is $1,381,260. See Note 4 of the Notes to Financial Statements for details.

(e) 

Annualized 7-day yield as of period end.

(f) 

During the six months ended January 31, 2019, investments in issuers considered to be affiliates of the Fund for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 
Affiliate    Shares
Held at
07/31/18
     Net
Activity
     Shares
Held at
01/31/19
     Value at
01/31/19
     Income     

Net

Realized
Gain (Loss)
 (a)

     Change in
Unrealized
Appreciation
(Depreciation)
 

BlackRock Liquidity Funds New York Money Fund Portfolio

            357,604        357,604      $ 357,604      $ 1,407      $      $  

BlackRock Liquidity Funds, MuniCash, Institutional Class

     1,061,194        (1,061,194                    1,871        9        (115
           

 

 

    

 

 

    

 

 

    

 

 

 
            $ 357,604      $ 3,278      $ 9      $ (115
           

 

 

    

 

 

    

 

 

    

 

 

 

 

  (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

     25          03/20/19        $ 3,062        $ (69,058

Long U.S. Treasury Bond

     9          03/20/19          1,320          (66,537

5-Year U.S. Treasury Note

     12          03/29/19          1,378          (23,976
                 

 

 

 
        $ (159,571
                 

 

 

 

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.

Derivative Financial Instruments Categorized by Risk Exposure

As of period 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  

Liabilities — Derivative Financial Instruments

                    

Futures contracts

                    

Net unrealized depreciation(a)

   $      $      $      $      $ 159,571      $      $ 159,571  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

  (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.

 

 

 

18    2019 BLACKROCK SEMI-ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (unaudited) (continued)

January 31, 2019

  

BlackRock Muni New York Intermediate Duration Fund, Inc. (MNE)

 

Derivative Financial Instruments Categorized by Risk Exposure (continued)

 

For the six months ended January 31, 2019, 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

   $      $      $      $      $ 29,621      $      $ 29,621  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
Net Change in Unrealized Appreciation (Depreciation) on:                                                 

Futures contracts

   $      $      $      $      $ (165,962    $      $ (165,962
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

Futures contracts:

 

Average notional value of contracts — short

   $ 4,336,203  

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)

   $        $ 104,335,170        $        $ 104,335,170  

Short-Term Securities

     357,604                            357,604  
  

 

 

      

 

 

      

 

 

      

 

 

 
   $ 357,604        $ 104,335,170        $        $ 104,692,774  
  

 

 

      

 

 

      

 

 

      

 

 

 

Derivative Financial Instruments(b)

                 

Liabilities:

                 

Interest rate contracts

   $ (159,571      $        $        $ (159,571
  

 

 

      

 

 

      

 

 

      

 

 

 

 

  (a) 

See above Schedule of Investments for values in each sector.

 
  (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

   $        $ (13,360,377      $        $ (13,360,377

VRDP Shares at Liquidation Value

              (29,600,000                 (29,600,000
  

 

 

      

 

 

      

 

 

      

 

 

 
   $        $ (42,960,377      $        $ (42,960,377
  

 

 

      

 

 

      

 

 

      

 

 

 

During the six months ended January 31, 2019, there were no transfers between levels.

See notes to financial statements.

 

 

SCHEDULES OF INVESTMENTS      19  


Schedule of Investments  (unaudited) 

January 31, 2019

  

BlackRock MuniYield Arizona Fund, Inc. (MZA)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  

Municipal Bonds — 147.1%

 

Arizona — 146.4%

 

Corporate — 21.9%  

Chandler IDA, RB, Intel Corporation Project, AMT,
2.70%, 12/01/37(a)

  $ 2,500     $ 2,518,075  

County of Maricopa Arizona Pollution Control Corp., Refunding RB, Southern California Edison Co., Series A, 5.00%, 06/01/35

    2,305       2,333,259  

County of Maricopa Industrial Development Authority, Refunding RB, HonorHealth, Series A:

   

4.13%, 09/01/42

    750       753,818  

5.00%, 09/01/42

    1,000       1,104,840  

County of Pima Arizona IDA, RB, Tucson Electric Power Co. Project, Series A, 5.25%, 10/01/40

    1,000       1,042,870  

County of Pima Arizona IDA, Refunding RB, Tucson Electric Power Co. Project, Series A, 4.00%, 09/01/29

    1,000       1,038,070  

Salt Verde Financial Corp., RB, Senior:

   

5.50%, 12/01/29

    2,000       2,426,140  

5.00%, 12/01/37

    2,500       2,904,350  
   

 

 

 
      14,121,422  
County/City/Special District/School District — 26.1%  

City of Tucson Arizona, COP, (AGC), 5.00%, 07/01/19(b)

    1,000       1,013,600  

County of Maricopa Arizona School District No. 28 Kyrene Elementary, GO, School Improvement Project of 2010, Series B:

   

5.50%, 07/01/29

    480       555,816  

5.50%, 07/01/30

    400       463,180  

County of Maricopa Arizona Unified School District No. 11 Peoria, GO, (AGM), 5.00%, 07/01/35

    1,250       1,416,538  

County of Maricopa Arizona Unified School District No. 210 Phoenix, GO, School Improvement Project of 2011 & 2017,
5.00%, 07/01/37

    1,000       1,154,870  

County of Mohave Arizona Unified School District No. 20 Kingman, GO, School Improvement Project of 2006, Series C (AGC), 5.00%, 07/01/26

    1,000       1,013,600  

Gilbert Public Facilities Municipal Property Corp., RB, 5.50%, 07/01/19(b)

    2,000       2,031,660  

Phoenix-Mesa Gateway Airport Authority, RB, Mesa Project, AMT, 5.00%, 07/01/38

    3,600       3,842,352  

Town of Buckeye Arizona, RB, 5.00%, 07/01/43

    4,000       4,482,960  

Town of Queen Creek Arizona Excise Tax Revenue, RB, Series A, 5.00%, 08/01/42

    750       857,775  
   

 

 

 
      16,832,351  
Education — 39.7%  

Arizona Board of Regents, COP, Refunding, University of Arizona, Series C, 5.00%, 06/01/30

    2,595       2,821,154  

Arizona IDA, Refunding RB:

   

Academies of Math And Science, 5.00%, 07/01/37

    1,250       1,384,563  

Basis Schools, Inc. Projects, Series A,
5.13%, 07/01/37(c)

    500       514,090  

Odyssey Preparatory Academy Project, Series A, 5.50%, 07/01/52(c)

    500       477,235  

Arizona State University, Refunding RB, 5.00%, 06/01/39

    2,050       2,317,730  

City of Phoenix Arizona IDA, RB:

   

Candeo School, Inc. Project, 6.63%, 07/01/33

    500       546,205  

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

    500       553,035  

Great Hearts Academies Projects, Series A,
5.00%, 07/01/44

    2,000       2,054,220  

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

    440       478,456  
Security   Par
(000)
    Value  
Education (continued)  

Legacy Traditional Schools Projects, Series A,
5.00%, 07/01/46(c)

  $ 500     $ 504,290  

City of Phoenix Arizona IDA, Refunding RB:

   

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

    1,000       1,008,130  

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

    1,500       1,511,385  

Downtown Phoenix Student Housing, LLC — Arizona State University Project, Series A, 5.00%, 07/01/42

    1,750       1,866,235  

Great Hearts Academies Projects, 5.00%, 07/01/46

    500       515,165  

Legacy Traditional School Projects, 5.00%, 07/01/45(c)

    500       503,245  

County of Maricopa Arizona IDA, RB, Reid Traditional Schools Projects, 5.00%, 07/01/47

    1,000       1,051,740  

County of Maricopa Arizona IDA, Refunding RB, Paradise Schools Projects, 5.00%, 07/01/47(c)

    1,000       1,015,420  

County of Pima Arizona IDA, Refunding RB,
5.00%, 07/01/36(d)

    500       580,520  

McAllister Academic Village LLC, Refunding RB, Arizona State University, 5.00%, 07/01/39

    500       565,620  

Northern Arizona University, RB, Stimulus Plan for Economic and Educational Development, 5.00%, 08/01/38

    3,000       3,293,580  

Student & Academic Services LLC, RB, (BAM),
5.00%, 06/01/39

    1,400       1,544,774  

Town of Florence, Inc. Arizona, IDA, ERB, Legacy Traditional School Project, Queen Creek and Casa Grande Campuses,
6.00%, 07/01/43

    500       519,935  
   

 

 

 
      25,626,727  
Health — 20.2%  

Arizona Health Facilities Authority, RB, Catholic Healthcare West, Series B-2 (AGM), 5.00%, 03/01/41

    500       522,735  

Arizona Health Facilities Authority, Refunding RB, Series A:

   

Phoenix Children’s Hospital, 5.00%, 02/01/42

    1,000       1,053,880  

Scottsdale Lincoln Hospitals Project, 5.00%, 12/01/42

    2,785       3,015,486  

City of Tempe Arizona IDA, Refunding RB, Friendship Village of Tempe, Series A, 6.25%, 12/01/42

    500       526,320  

County of Glendale Arizona IDA, Refunding RB, Terrace of Phoenix Project, 5.00%, 07/01/48

    530       535,411  

County of Maricopa Arizona IDA, RB, Catholic Healthcare West, Series A, 6.00%, 07/01/39

    170       172,705  

County of Maricopa Arizona IDA, Refunding RB, Banner Health Obligation Group:

   

5.00%, 01/01/38

    1,320       1,481,872  

Series A, 4.00%, 01/01/41

    3,000       3,074,580  

County of Yavapai Arizona IDA, Refunding RB, Northern Arizona Healthcare System, 5.25%, 10/01/26

    1,000       1,079,380  

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

    500       509,710  

University Medical Center Corp., Refunding RB,
6.00%, 07/01/21(b)

    1,000       1,097,790  
   

 

 

 
      13,069,869  
State — 3.1%  

State of Arizona, RB, Lottery Revenue, Series A (AGM), 5.00%, 07/01/29

    1,930       1,985,545  
   

 

 

 
Transportation — 2.8%  

City of Phoenix Arizona Civic Improvement Corp., Refunding RB:

   

Junior Lien, Series A, 5.00%, 07/01/20(b)

    1,000       1,046,140  

Senior Lien, AMT, 5.00%, 07/01/32

    700       772,604  
   

 

 

 
      1,818,744  
Utilities — 32.6%  

City of Lake Havasu City Arizona Wastewater System Revenue, RB, Series B (AGM), 5.00%, 07/01/40

    3,500       3,933,475  
 

 

 

20    2019 BLACKROCK SEMI-ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (unaudited) (continued)

January 31, 2019

  

BlackRock MuniYield Arizona Fund, Inc. (MZA)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Utilities (continued)  

City of Mesa Arizona Utility System Revenue, RB,
5.00%, 07/01/42

  $ 3,000     $ 3,453,060  

City of Phoenix Civic Improvement Corp., ARB, AMT, Series A,
5.00%, 07/01/42

    3,000       3,332,160  

City of Phoenix Civic Improvement Corp., RB:

   

Junior Lien, Series A, 4.00%, 07/01/39

    1,300       1,361,256  

Series B (BHAC), 5.50%, 07/01/41

    100       131,250  

City of Phoenix Civic Improvement Corp., Refunding RB, Junior Lien Airport, Series D, 4.00%, 07/01/40

    1,000       1,028,040  

County of Pinal Arizona, Refunding RB, Electric District No. 3,
5.25%, 07/01/21(b)

    2,500       2,706,675  

County of Pinal Arizona IDA, RB, San Manuel Facility Project, AMT, 6.25%, 06/01/26

    500       511,630  

Salt River Project Agricultural Improvement & Power District, Refunding RB:

   

5.00%, 01/01/38

    2,000       2,325,900  

Series A, 5.00%, 12/01/41

    2,000       2,243,500  
   

 

 

 
      21,026,946  
   

 

 

 

Total Municipal Bonds in Arizona

 

    94,481,604  
   

 

 

 

Puerto Rico — 0.7%

 

Tobacco — 0.7%  

Children’s Trust Fund, Refunding RB, Tobacco Settlement Asset-Backed Bonds, 5.63%, 05/15/43

    460       465,138  
   

 

 

 

Total Municipal Bonds in Puerto Rico

 

    465,138  
   

 

 

 

Total Municipal Bonds — 147.1%
(Cost — $91,629,629)

 

    94,946,742  
   

 

 

 

Municipal Bonds Transferred to Tender Option Bond
Trusts(e) — 16.6%

 

Arizona — 16.6%

 

Utilities — 16.6%  

City of Mesa Arizona Utility System Revenue, RB, Utility System, 5.00%, 07/01/35

    3,000       3,205,125  

City of Phoenix Civic Improvement Corp., Refunding RB:

   

Senior Lien, AMT, 5.00%, 07/01/43

    4,000       4,475,860  
Security   Par
(000)
    Value  
Utilities (continued)  

Water System, Junior Lien, Series A,
5.00%, 07/01/19(b)

  $ 3,000     $ 3,040,545  
   

 

 

 

Total Municipal Bonds Transferred to Tender Option Bond Trusts — 16.6%
(Cost — $10,380,897)

 

    10,721,530  
   

 

 

 

Total Long-Term Investments — 163.7%
(Cost — $102,010,526)

 

    105,668,272  
   

 

 

 
     Shares         

Short-Term Securities — 1.9%

 

BlackRock Liquidity Funds, MuniCash, Institutional Class, 1.24%(f)(g)

    1,257,520       1,257,771  
   

 

 

 

Total Short-Term Securities — 1.9%
(Cost — $1,257,711)

 

    1,257,771  
   

 

 

 

Total Investments — 165.6%
(Cost — $103,268,237)

 

    106,926,043  

Liabilities in Excess of Other Assets — (0.3)%

 

    (197,241

Liability for TOB Trust Certificates, Including Interest Expense and Fees Payable — (7.8)%

 

    (5,006,242

VRDP Shares at Liquidation Value, Net of Deferred Offering
Costs — (57.5)%

 

    (37,155,310
   

 

 

 

Net Assets — 100.0%

 

  $ 64,567,250  
   

 

 

 

 

(a) 

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.

(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) 

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.

(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.

(f) 

Annualized 7-day yield as of period end.

 
  (g) 

During the six months ended January 31, 2019, 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:

 

 

Affiliate    Shares
Held at
07/31/18
     Net
Activity
     Shares
Held at
01/31/19
     Value at
01/31/19
     Income     

Net

Realized
Gain (Loss)
 (a)

     Change in
Unrealized
Appreciation
(Depreciation)
 

BlackRock Liquidity Funds, MuniCash, Institutional Class

     406,896        850,624        1,257,520      $ 1,257,771      $ 5,504      $ 37      $ 20  
           

 

 

    

 

 

    

 

 

    

 

 

 

 

  (a) 

Includes net capital gain distributions, if applicable.

 

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.

 

 

SCHEDULES OF INVESTMENTS      21  


Schedule of Investments  (unaudited) (continued)

January 31, 2019

  

BlackRock MuniYield Arizona Fund, Inc. (MZA)

 

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

     8          03/20/19        $ 980        $ (27,298

Long U.S. Treasury Bond

     23          03/20/19          3,374          (154,729

5-Year U.S. Treasury Note

     4          03/29/19          459          (8,541
                 

 

 

 
          $ (190,568
                 

 

 

 

Derivative Financial Instruments Categorized by Risk Exposure

As of period 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  

Liabilities — Derivative Financial Instruments

                    

Futures contracts

                    

Net unrealized depreciation(a)

   $      $      $      $      $ 190,568      $      $ 190,568  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

  (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 six months ended January 31, 2019, 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

   $      $      $      $      $ 35,278      $      $ 35,278  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
Net Change in Unrealized Appreciation (Depreciation) on:                                                 

Futures contracts

   $      $      $      $      $ (180,152    $      $ (180,152
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

Futures contracts:

 

Average notional value of contracts — short

   $ 3,947,398  

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)

   $        $ 105,668,272        $        $ 105,668,272  

Short-Term Securities

     1,257,771                            1,257,771  
  

 

 

      

 

 

      

 

 

      

 

 

 
   $ 1,257,771        $ 105,668,272        $        $ 106,926,043  
  

 

 

      

 

 

      

 

 

      

 

 

 

Derivative Financial Instruments(b)

                 

Liabilities:

                 

Interest rate contracts

   $ (190,568      $        $        $ (190,568
  

 

 

      

 

 

      

 

 

      

 

 

 

 

  (a) 

See above Schedule of Investments for values in each sector.

 
  (b) 

Derivative financial instruments are futures contracts which are valued at the unrealized appreciation (depreciation) on the instrument.

 

 

 

22    2019 BLACKROCK SEMI-ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (unaudited) (continued)

January 31, 2019

  

BlackRock MuniYield Arizona Fund, Inc. (MZA)

 

Fair Value Hierarchy as of Period End (continued)

 

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

   $        $ (5,000,000      $        $ (5,000,000

VRDP Shares at Liquidation Value

              (37,300,000                 (37,300,000
  

 

 

      

 

 

      

 

 

      

 

 

 
   $        $ (42,300,000      $        $ (42,300,000
  

 

 

      

 

 

      

 

 

      

 

 

 

During the six months ended January 31, 2019, there were no transfers between levels.

See notes to financial statements.

 

 

SCHEDULES OF INVESTMENTS      23  


Schedule of Investments  (unaudited)

January 31, 2019

  

BlackRock MuniYield California Fund, Inc. (MYC)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  

Municipal Bonds — 86.2%

 

California — 86.2%

 

County/City/Special District/School District — 22.3%  

Anaheim California Union High School District, GO, Election of 2014, 4.00%, 08/01/42

  $ 5,725     $ 5,998,025  

City of Los Angeles California, COP, Senior, Sonnenblick Del Rio West Los Angeles (AMBAC), 6.20%, 11/01/31

    2,000       2,007,360  

City of Los Angeles California Municipal Improvement Corp., RB, Real Property, Series E, 6.00%, 09/01/19(a)

    2,660       2,728,096  

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

   

6.50%, 05/01/36

    1,520       1,672,319  

6.50%, 05/01/42

    1,860       2,046,391  

County of Los Angeles California Metropolitan Transportation Authority, Refunding RB, Series A, 5.00%, 07/01/42

    4,000       4,590,520  

County of Riverside California Public Financing Authority, RB, Capital Facilities Project, 5.25%, 11/01/45

    5,000       5,774,200  

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

    2,440       2,658,746  

Garden Grove Unified School District, GO, Election of 2010, Series C, 5.25%, 08/01/40

    5,500       6,201,140  

Los Angeles California Community College District, GO, Series G,
4.00%, 08/01/39

    5,430       5,613,968  

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

    3,500       4,126,500  

Riverside Community Properties Development, Inc., RB, Riverside County Law Building Project, 6.00%, 10/15/23(a)

    5,000       6,001,600  

San Diego Unified School District, GO, Election of 2012, Series I, 5.00%, 07/01/47

    5,935       6,773,319  

San Francisco Bay Area Rapid Transit District, GO, Election of 2016, Green Bonds, Series A, 4.00%, 08/01/42

    7,875       8,220,949  

Tracy Community Facilities District, Special Tax Bonds, Series 1:

   

5.00%, 09/01/38

    230       251,231  

5.00%, 09/01/43

    350       381,003  

5.00%, 09/01/48

    385       418,445  

Washington Township Health Care District, GO, Election of 2004,
Series B, 5.50%, 08/01/38

    1,625       1,895,481  

West Contra Costa California Unified School District, GO, Election of 2012, Series A, 5.50%, 08/01/39

    2,500       2,867,150  
   

 

 

 
      70,226,443  
Education — 9.8%  

California Educational Facilities Authority, Refunding RB(a):

   

Pitzer College, 6.00%, 04/01/20

    2,500       2,628,050  

San Francisco University, 6.13%, 10/01/21

    855       956,463  

San Francisco University, 6.13%, 10/01/21

    890       996,853  

California Municipal Finance Authority, RB, Emerson College,
6.00%, 01/01/22(a)

    2,750       3,096,638  

California School Finance Authority, RB:

   

Alliance College-Ready Public Schools — 2023 Union LLC Project, Series A, 6.00%, 07/01/33

    1,500       1,655,130  

Alliance College-Ready Public Schools — 2023 Union LLC Project, Series A, 6.30%, 07/01/43

    3,000       3,306,780  

Value Schools, 6.65%, 07/01/33

    595       651,828  

Value Schools, 6.90%, 07/01/43

    1,330       1,451,283  

State of California University, Refunding RB, Systemwide, Series A, 5.00%, 11/01/41

    2,000       2,250,220  

University of California, Refunding RB:

   

General, Series AZ, 5.00%, 05/15/36

    4,425       5,195,835  

General, Series AZ, 5.00%, 05/15/43

    4,700       5,378,492  

Limited Project, Series O, 5.00%, 05/15/40

    3,000       3,440,880  
   

 

 

 
      31,008,452  
Security   Par
(000)
    Value  
Health — 12.4%  

California Health Facilities Financing Authority, RB:

   

Children’s Hospital, Series A, 5.25%, 11/01/41

  $ 9,700     $ 10,574,649  

Sutter Health, Series A, 5.00%, 11/15/41

    925       1,023,346  

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

    7,530       8,038,426  

California Health Facilities Financing Authority, Refunding RB, Catholic Healthcare West, Series A, 6.00%, 07/01/19(a)

    10,000       10,180,600  

California Statewide Communities Development Authority, RB:

   

Loma Linda University Medical Center, 5.50%, 12/01/58(b)

    625       679,575  

Sutter Health, Series A, 6.00%, 08/15/20(a)

    8,110       8,651,180  
   

 

 

 
      39,147,776  
Housing — 1.1%  

County of Santa Clara California Housing Authority, RB, M/F, John Burns Gardens Apartments Project, Series A, AMT,
6.00%, 08/01/41

    3,500       3,507,770  
   

 

 

 
State — 11.4%  

State of California, GO, Refunding:

   

Various Purpose, 5.00%, 09/01/35

    10,115       11,646,613  

Various Purpose, 5.25%, 10/01/39

    3,500       4,018,350  

Various Purposes, 5.00%, 11/01/36

    2,000       2,330,560  

State of California Public Works Board, LRB:

   

Department of Developmental Services, Poterville, Series C,
6.25%, 04/01/19(a)

    1,610       1,622,284  

Department of Education, Riverside Campus Project, Series B,
6.50%, 04/01/19(a)

    10,000       10,080,100  

Various Capital Projects, Series I, 5.50%, 11/01/33

    1,510       1,716,372  

Various Capital Projects, Sub-Series I-1, 6.38%, 11/01/19(a)

    4,400       4,558,136  
   

 

 

 
      35,972,415  
Tobacco — 4.3%  

County of California Tobacco Securitization Agency, Refunding RB, Asset-Backed, Merced County, Series A,
5.25%, 06/01/45

    775       776,898  

Golden State Tobacco Securitization Corp., Refunding RB, Series A-1, 5.00%, 06/01/47

    9,840       9,296,045  

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

   

5.00%, 06/01/37

    3,000       3,000,000  

5.13%, 06/01/46

    605       605,000  
   

 

 

 
      13,677,943  
Transportation — 13.9%  

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

    3,550       3,941,636  

City & County of San Francisco California Airports Commission, ARB, Second Series E, 6.00%, 05/01/39

    3,000       3,032,640  

City & County of San Francisco California Airports Commission, Refunding ARB, 2nd Series A, AMT, 5.25%, 05/01/33

    1,440       1,608,221  

City & County of San Francisco California Port Commission, RB, Series A, 5.13%, 03/01/40

    5,075       5,225,169  

City of Long Beach California Harbor Revenue, ARB, Series A, AMT, 5.00%, 05/15/40

    3,910       4,406,101  

City of Los Angeles California Department of Airports, ARB, AMT:

   

Los Angeles International Airport, Series B, 5.00%, 05/15/36

    2,365       2,655,753  

Los Angeles International Airports, Series A,
5.25%, 05/15/38

    1,670       1,938,569  

City of Los Angeles California Metropolitan Transportation Authority, Refunding RB, Green Bond, Series A,
5.00%, 07/01/41

    1,300       1,495,052  

City of San Jose California, ARB, Norman Y Mineta San Jose International Airport SJC, Series A-1, AMT (AGM):

   

5.50%, 03/01/30

    1,000       1,066,980  

5.75%, 03/01/34

    1,000       1,067,810  
 

 

 

24    2019 BLACKROCK SEMI-ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (unaudited) (continued)

January 31, 2019

  

BlackRock MuniYield California Fund, Inc. (MYC)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Transportation (continued)  

City of San Jose California, Refunding ARB, Norman Y Mineta San Jose International Airport SJC, Series A-1, AMT,
6.25%, 03/01/34

  $ 1,400     $ 1,511,986  

County of Sacramento California Airport System Revenue, Refunding RB, Series C, AMT, 5.00%, 07/01/37

    3,000       3,409,530  

County of Sacramento California Airport System Revenue, Refunding ARB, Senior Series A, 5.00%, 07/01/41

    8,290       9,255,454  

County of Sacramento California Airport System Revenue, Refunding RB, Series C, AMT, 5.00%, 07/01/36

    750       856,290  

County of San Diego Regional Airport Authority, ARB, Subordinate, Series B, AMT, 5.00%, 07/01/42

    2,000       2,221,440  
   

 

 

 
      43,692,631  
Utilities — 11.0%  

City of Los Angeles California Department of Water & Power, RB, Power System, Series A, 5.00%, 07/01/42

    3,440       3,905,535  

City of Los Angeles California Department of Water & Power, Refunding RB:

   

Series B, 5.00%, 07/01/43

    6,000       6,929,280  

Water System, Series A, 5.25%, 07/01/39

    4,000       4,250,680  

City of Petaluma California Wastewater Revenue, Refunding RB,
6.00%, 05/01/21(a)

    2,645       2,906,353  

City of Richmond California Wastewater Revenue, Refunding RB,
Series A, 5.00%, 08/01/42

    5,185       5,948,906  

Dublin-San Ramon Services District Water Revenue, Refunding RB, 6.00%, 02/01/21(a)

    2,420       2,633,396  

Eastern Municipal Water District, Refunding RB, Series A, 5.00%, 07/01/42

    3,000       3,400,110  

Oceanside Public Financing Authority, Refunding RB, Series A:

   

5.25%, 05/01/30

    1,245       1,419,611  

5.25%, 05/01/33

    2,810       3,186,877  
   

 

 

 
      34,580,748  
   

 

 

 

Total Municipal Bonds in California

 

    271,814,178  
   

 

 

 

Puerto Rico — 0.0%

 

Tobacco — 0.0%  

Children’s Trust Fund, Refunding RB, Tobacco Settlement Asset-Backed Bonds, 5.50%, 05/15/39

    145       146,620  
   

 

 

 

Total Municipal Bonds in Puerto Rico

 

    146,620  
   

 

 

 

Total Municipal Bonds — 86.2%
(Cost — $262,939,738)

 

    271,960,798  
   

 

 

 

Municipal Bonds Transferred to Tender Option Bond
Trusts(c) — 83.5%

 

California — 83.5%

 

County/City/Special District/School District — 32.9%  

County of Los Angeles California Public Works Financing Authority, Refunding RB, Series A:

   

5.00%, 12/01/39

    17,850       20,279,474  

5.00%, 12/01/44

    14,095       15,932,225  

Los Angeles Community College District California, GO, Election of 2008, Series C, 5.25%, 08/01/20(a)(d)

    9,681       10,206,800  

Los Angeles Community College District California, GO, Refunding, Election of 2008, Series A, 6.00%, 08/01/19(a)

    3,829       3,912,627  

Palomar Community College District, GO, Election of 2006,
Series C, 5.00%, 08/01/44

    15,140       17,196,088  

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

    7,734       7,877,746  
Security   Par
(000)
    Value  
County/City/Special District/School District (continued)  

San Marcos Unified School District, GO, Election of 2010, Series A, 5.00%, 08/01/21(a)

  $ 15,520     $ 16,849,210  

Santa Monica Community College District, GO, Election of 2016,
Series A, 5.00%, 08/01/43

    10,000       11,614,450  
   

 

 

 
      103,868,620  
Education — 26.5%  

California State University, Refunding RB, Systemwide, Series A:

   

5.00%, 11/01/41

    9,775       10,997,718  

5.00%, 11/01/42(d)

    13,430       15,251,780  

University of California, RB, Series AM, 5.25%, 05/15/44

    11,950       13,458,030  

University of California, Refunding RB:

   

Series A, 5.00%, 11/01/43

    5,001       5,631,072  

Series AZ, 5.00%, 05/15/43(d)

    12,000       13,732,320  

Series I, 5.00%, 05/15/40

    21,875       24,527,393  
   

 

 

 
      83,598,313  
Health — 13.3%  

California Health Facilities Financing Authority, RB, Sutter Health,
Series A, 5.00%, 11/15/41

    11,000       12,169,520  

California Statewide Communities Development Authority, Refunding RB, Cottage Health System Obligation, 5.00%, 11/01/43

    26,870       29,669,048  
   

 

 

 
      41,838,568  
State — 4.1%            

State of California, GO, Refunding, Go, Refunding, Various Purpose, Bid Group, 5.00%, 08/01/37

    10,975       12,854,267  
   

 

 

 
Transportation — 3.5%            

City of Los Angeles California Department of Airports, ARB, Series A, AMT, 5.00%, 05/15/45

    10,045       11,190,695  
   

 

 

 
Utilities — 3.2%            

City of Los Angeles California Wastewater System Revenue, Refunding RB, Series A, 5.00%, 06/01/19(a)

    9,870       9,982,271  
   

 

 

 

Total Municipal Bonds Transferred to Tender Option Bond
Trusts — 83.5%
(Cost — $258,836,637)

 

    263,332,734  
   

 

 

 

Total Long-Term Investments — 169.7%
(Cost — $521,776,375)

 

  $ 535,293,532  
   

 

 

 

Other Assets Less Liabilities — 1.9%

 

    6,057,458  

Liability for TOB Trust Certificates, Including Interest Expense and Fees Payable — (38.1)%

 

    (120,165,064

VRDP Shares at Liquidation Value, Net of Deferred Offering
Costs — (33.5)%

 

    (105,703,144
   

 

 

 

Net Assets Applicable to Common Shares — 100.0%

 

  $ 315,482,782  
   

 

 

 

 

(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) 

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 May 18, 2020 to May 15, 2026, is $18,469,609. See Note 4 of the Notes to Financial Statements for details.

 

 

 

SCHEDULES OF INVESTMENTS      25  


Schedule of Investments  (unaudited) (continued)

January 31, 2019

  

BlackRock MuniYield California Fund, Inc. (MYC)

 

(e) 

During the six months ended January 31, 2019, investments in issuers considered to be affiliates of the Fund for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliate    Shares
Held at
07/31/18
     Net
Activity
     Shares
Held at
01/31/19
     Value at
01/31/19
     Income     

Net

Realized
Gain (Loss)
 (a)

     Change in
Unrealized
Appreciation
(Depreciation)
 

BlackRock Liquidity Funds California Money Fund, Institutional Class*

                        $      $ 5,891      $      $  

BlackRock Liquidity Funds, MuniCash, Institutional Class*

     5,452,423        (5,452,423                    3,973        (331      (214
           

 

 

    

 

 

    

 

 

    

 

 

 
            $      $ 9,864      $ (331    $ (214
           

 

 

    

 

 

    

 

 

    

 

 

 

 

  *

No longer held by the fund as of period end.

 
  (a) 

Includes net capital gain distributions, if applicable.

 

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.

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

     95        03/20/19      $ 11,635      $ (247,096

Long U.S. Treasury Bond

     126        03/20/19        18,483        (874,153

5-Year U.S. Treasury Note

     22        03/29/19        2,527        (43,682
           

 

 

 
         $ (1,164,931
           

 

 

 

Derivative Financial Instruments Categorized by Risk Exposure

As of period 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  

Liabilities — Derivative Financial Instruments

                    

Futures contracts

                    

Net unrealized depreciation(a) . . . . . . . . . . . . . .. . . .

   $      $      $      $      $ 1,164,931      $      $ 1,164,931  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

  (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 six months ended January 31, 2019, 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

   $      $      $      $      $ 293,787      $      $ 293,787  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
Net Change in Unrealized Appreciation (Depreciation) on:                                                 

Futures contracts

   $      $      $      $      $ (1,180,678    $      $ (1,180,678
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

Futures contracts:

        

Average notional value of contracts — short

   $ 24,248,086  

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

 

 

26    2019 BLACKROCK SEMI-ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (unaudited) (continued)

January 31, 2019

  

BlackRock MuniYield California Fund, Inc. (MYC)

 

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)

   $        $ 535,293,532        $        $ 535,293,532  
  

 

 

      

 

 

      

 

 

      

 

 

 

Derivative Financial Instruments(b)

                 

Liabilities:

                 

Interest rate contracts

   $ (1,164,931      $        $        $ (1,164,931
  

 

 

      

 

 

      

 

 

      

 

 

 

 

  (a) 

See above Schedule of Investments for values in each sector.

 
  (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

   $        $ (119,600,027      $        $ (119,600,027

VRDP Shares at Liquidation Value

              (105,900,000                 (105,900,000
  

 

 

      

 

 

      

 

 

      

 

 

 
   $        $ (225,500,027      $        $ (225,500,027
  

 

 

      

 

 

      

 

 

      

 

 

 

During the six months ended January 31, 2019, there were no transfers between levels.

See notes to financial statements.

 

 

SCHEDULES OF INVESTMENTS      27  


Schedule of Investments  (unaudited)

January 31, 2019

  

BlackRock MuniYield Investment Fund (MYF)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  

Municipal Bonds — 101.7%

 

Alabama — 0.3%  

City of Selma Alabama IDB, RB, Gulf Opportunity Zone, International Paper Co. Project, Series A, 5.38%, 12/01/35

  $ 545     $ 585,761  
   

 

 

 
Arizona — 1.7%  

Arizona IDA, Refunding RB, Basis Schools, Inc. Projects, Series A, 5.38%, 07/01/50(a)

    1,645       1,686,816  

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

    1,070       1,079,181  

County of Maricopa IDA, Refunding RB, Honorhealth, Series A, 4.13%, 09/01/38

    550       557,595  
   

 

 

 
      3,323,592  
California — 11.6%  

California Health Facilities Financing Authority, RB, Sutter Health, Series B, 6.00%, 08/15/20(b)

    1,645       1,756,070  

California Health Facilities Financing Authority, Refunding RB, Catholic Healthcare West, Series A, 6.00%, 07/01/19(b)

    710       722,823  

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

    145       158,357  

California Statewide Communities Development Authority, RB, Series A(a):

   

Lancer Educational student Housing Project,
5.00%, 06/01/46

    1,680       1,774,735  

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

    290       302,252  

California Statewide Communities Development Authority, Refunding RB, Lancer Educational student Housing Project, Series A, 5.00%, 06/01/36(a)

    1,360       1,454,452  

City & County of San Francisco California Airports Commission, Refunding ARB, 2nd Series A, AMT:

   

5.50%, 05/01/28

    1,065       1,209,787  

5.25%, 05/01/33

    830       926,961  

City of San Jose California, Refunding ARB, Norman Y Mineta San Jose International Airport SJC, Series A-1, AMT,
5.50%, 03/01/30

    1,500       1,598,895  

Golden State Tobacco Securitization Corp., Refunding RB, Series A-1, 5.25%, 06/01/47

    655       644,474  

Kern Community College District, GO, Safety, Repair & Improvement, Series C, 5.50%, 11/01/33

    1,620       1,878,406  

Regents of the University of California Medical Center Pooled Revenue, Refunding RB, Series J:

   

5.25%, 05/15/23(b)

    2,905       3,341,912  

5.25%, 05/15/38

    825       921,500  

State of California, GO, Various Purposes, 6.00%, 03/01/33

    2,535       2,653,106  

State of California Public Works Board, LRB, Various Capital Projects, Series I, 5.50%, 11/01/31

    1,000       1,140,040  

State of California Public Works Board, RB, Department of Corrections & Rehabilitation, Series F, 5.25%, 09/01/33

    835       936,361  

Township of Washington California Health Care District, GO, Election of 2004, Series B, 5.50%, 08/01/40

    625       725,175  
   

 

 

 
      22,145,306  
Colorado — 1.8%  

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

    345       345,173  

City & County of Denver Colorado, RB, Capital Appreciation Bonds, Series A-2, 0.00%,
08/01/37(c)

    1,760       845,363  

City & County of Denver Colorado Airport System, ARB, Series A, AMT:

   

5.50%, 11/15/28

    1,000       1,133,380  

5.50%, 11/15/30

    330       371,956  

5.50%, 11/15/31

    400       449,896  

Colorado Health Facilities Authority, Refunding RB, Frasier Meadows Retirement Community Project, Series A, 5.25%, 05/15/37

    290       310,883  
   

 

 

 
      3,456,651  
Security   Par
(000)
    Value  
Connecticut — 1.2%  

Connecticut Housing Finance Authority, Refunding RB, S/F Housing:

   

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

  $ 1,575     $ 1,567,456  

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

    755       758,344  
   

 

 

 
      2,325,800  
Delaware — 1.2%  

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

    500       527,240  

Delaware State Health Facilities Authority, RB,
5.00%, 06/01/48

    1,605       1,724,797  
   

 

 

 
      2,252,037  
Florida — 6.8%  

County of Broward Florida Airport System, ARB, Series A, AMT, 5.00%, 10/01/45

    1,005       1,096,917  

County of Hillsborough Florida Aviation Authority, Refunding ARB, Tampa International Airport, Series A, AMT,
5.50%, 10/01/29

    1,995       2,257,502  

County of Lee Florida, Refunding ARB, Series A, AMT,
5.38%, 10/01/32

    2,000       2,136,580  

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

    115       115,815  

County of Manatee Florida HFA, RB, S/F Housing, Series A, AMT (Ginnie Mae, Fannie Mae & Freddie Mac), 5.90%, 09/01/40

    90       90,170  

County of Miami-Dade Florida, RB, Seaport Department:

   

Series A, 5.38%, 10/01/33

    1,170       1,308,809  

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

    525       603,068  

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

    700       797,489  

County of Miami-Dade Florida Aviation, Refunding ARB, Series A, AMT, 5.00%, 10/01/31

    2,440       2,635,932  

Lakewood Ranch Stewardship District, Special Assessment Bonds, Lakewood National & Polo Run Projects:

   

5.25%, 05/01/37

    240       247,922  

5.38%, 05/01/47

    260       267,561  

Reedy Creek Florida Improvement District, GO, Series A,
5.25%, 06/01/32

    1,200       1,352,820  
   

 

 

 
      12,910,585  
Georgia — 0.2%  

County of Griffin-Spalding Hospital Authority, RB, Revenue Anticipation Certificates, 4.00%, 04/01/42

    370       368,324  
   

 

 

 
Hawaii — 0.6%  

State of Hawaii Airports System, COP, AMT:

   

5.25%, 08/01/25

    485       541,988  

5.25%, 08/01/26

    525       583,852  
   

 

 

 
      1,125,840  
Illinois — 17.5%  

Chicago Board of Education, GO, Series C:

   

Dedicated Revenues, Series H, 5.00%, 12/01/36

    295       302,815  

Project, 5.25%, 12/01/35

    970       1,001,835  

Chicago Board of Education, GO, Refunding:

   

Dedicated Revenues, Series D, 5.00%, 12/01/25

    530       560,056  

Dedicated Revenues, Series F, 5.00%, 12/01/22

    400       416,916  

Dedicated Revenues, Series G, 5.00%, 12/01/34

    290       299,805  

5.00%, 12/01/25

    415       438,535  

Chicago Board of Education, GO, Series D:

   

5.00%, 12/01/46

    345       347,104  

5.00%, 12/01/46

    885       887,947  

City of Chicago Illinois Midway International Airport, Refunding GARB, 2nd Lien, Series A, AMT, 5.00%, 01/01/41

    1,000       1,076,890  

City of Chicago Illinois O’Hare International Airport, GARB, 3rd Lien, Series C, 6.50%, 01/01/21(b)

    6,065       6,611,638  
 

 

 

28    2019 BLACKROCK SEMI-ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (unaudited) (continued)

January 31, 2019

  

BlackRock MuniYield Investment Fund (MYF)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Illinois (continued)  

City of Chicago Illinois Transit Authority, RB, Sales Tax Receipts:

   

5.25%, 12/01/36

  $ 1,000     $ 1,056,570  

5.25%, 12/01/40

    1,000       1,051,040  

County of Cook Illinois Community College District No. 508, GO, City College of Chicago:

   

5.50%, 12/01/38

    1,000       1,042,430  

5.25%, 12/01/43

    1,500       1,544,925  

Illinois Finance Authority, RB, Carle Foundation, Series A,
6.00%, 08/15/41

    4,000       4,348,400  

Illinois Finance Authority, Refunding RB, Northwestern Memorial Hospital, Series A, 6.00%, 08/15/19(b)

    4,160       4,254,058  

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

   

0.00%, 12/15/56(c)

    2,965       450,532  

5.00%, 06/15/57

    810       832,729  

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

    4,140       697,507  

Railsplitter Tobacco Settlement Authority, RB(b):

   

5.50%, 06/01/21

    1,370       1,485,532  

6.00%, 06/01/21

    390       427,311  

State of Illinois, GO:

   

5.25%, 02/01/32

    2,200       2,298,010  

5.50%, 07/01/33

    1,000       1,055,070  

5.50%, 07/01/38

    415       433,094  

Series D, 5.00%, 11/01/28

    440       475,196  
   

 

 

 
      33,395,945  
Indiana — 2.1%  

City of Valparaiso Indiana, RB, Exempt Facilities, Pratt Paper LLC Project, AMT, 6.75%, 01/01/34

    1,350       1,539,702  

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

   

6.63%, 01/15/34

    170       178,162  

6.75%, 01/15/43

    355       371,390  

6.88%, 01/15/52

    515       539,818  

Indiana Finance Authority, Refunding RB, Marquette Project, 4.75%, 03/01/32

    700       708,155  

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

    720       732,744  
   

 

 

 
      4,069,971  
Iowa — 1.3%  

Iowa Finance Authority, RB, Lifespace Communities, Series A, 5.00%, 05/15/43

    295       304,980  

Iowa Finance Authority, Refunding RB, Iowa Fertilizer Co. Project:

   

Series B, 5.25%, 12/01/50(d)

    1,255       1,335,044  

Midwestern Disaster Area, 5.50%, 12/01/22

    5       5,005  

Midwestern Disaster Area, 5.25%, 12/01/25

    865       916,640  
   

 

 

 
      2,561,669  
Kansas — 2.5%  

City of Lenexa Kansas, Refunding RB, Lakeview Village, Inc., Series A:

   

5.00%, 05/15/39

    660       676,705  

5.00%, 05/15/43

    655       665,604  

Kansas Development Finance Authority, Refunding RB, Adventist Health System:

   

5.50%, 11/15/19(b)

    75       77,092  

5.50%, 11/15/29

    3,200       3,285,696  
   

 

 

 
      4,705,097  
Louisiana — 3.4%  

Lake Charles Louisiana Harbor & Terminal District, RB, Series B, AMT (AGM), 5.50%, 01/01/29

    1,500       1,687,425  
Security   Par
(000)
    Value  
Louisiana (continued)  

Louisiana Local Government Environmental Facilities & Community Development Authority, RB, Westlake Chemical Corp. Project, Series A-1, 6.50%, 11/01/35

  $ 1,420     $ 1,511,377  

Louisiana Public Facilities Authority, Refunding RB, Ochsner Clinic Foundation Project, 5.00%, 05/15/47

    1,895       2,032,122  

Tobacco Settlement Financing Corp., Refunding RB, Asset-Backed, Series A, 5.50%, 05/15/29

    1,195       1,205,086  
   

 

 

 
      6,436,010  
Maine — 0.8%  

Maine Health & Higher Educational Facilities Authority, RB, Maine General Medical Center, 7.50%, 07/01/32

    765       838,211  

State of Maine Housing Authority, RB, M/F Housing, Series E, 4.25%, 11/15/43

    740       755,747  
   

 

 

 
      1,593,958  
Maryland — 0.1%  

City of Baltimore Maryland, Refunding RB, East Baltimore Research Park, Series A, 4.50%, 09/01/33

    185       188,957  
   

 

 

 
Massachusetts — 1.7%  

Massachusetts Development Finance Agency, Refunding RB, Suffolk University, 4.00%, 07/01/39

    2,045       1,967,515  

Massachusetts HFA, Refunding RB, AMT:

   

Series B, 5.50%, 06/01/41

    700       705,551  

Series C, 5.35%, 12/01/42

    645       649,180  
   

 

 

 
      3,322,246  
Michigan — 2.6%  

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

    1,805       1,950,122  

Eastern Michigan University, RB, Series A, 4.00%, 03/01/47

    1,455       1,474,890  

Michigan Strategic Fund, RB, I-75 Improvement Projects, AMT,
5.00%, 06/30/48

    570       618,661  

State of Michigan Housing Development Authority, RB, S/F Housing, Series C, 4.13%, 12/01/38

    860       882,704  
   

 

 

 
      4,926,377  
Montana — 0.1%  

City of Kalispell Montana, Refunding RB, Immanuel Lutheran Corporation Project, Series A, 5.25%, 05/15/37

    170       174,930  
   

 

 

 
Nevada — 3.6%  

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

    1,350       1,359,328  

County of Clark Nevada Airport System, ARB, Series B, 5.75%, 07/01/42

    3,375       3,481,144  

Las Vegas Convention & Visitors Authority, RB, Series B, 4.00%, 07/01/49

    2,000       2,010,860  
   

 

 

 
      6,851,332  
New Hampshire — 0.5%  

New Hampshire Housing Finance Authority, RB, Cimarron, Whittier Falls & Marshall (FHA), 4.00%, 07/01/52

    1,000       999,950  
   

 

 

 
New Jersey — 5.7%  

New Jersey EDA, RB, Private Activity Bond, Goethals Bridge Replacement Project, AMT (AGM), 5.00%, 01/01/31

    900       976,851  

New Jersey EDA, Refunding RB, New Jersey American Water Co., Inc. Project, Series A, AMT, 5.70%, 10/01/39

    2,250       2,296,777  

New Jersey Transportation Trust Fund Authority, RB, Series AA:

   

Transportation Program Bonds, 4.13%, 06/15/39

    1,210       1,176,604  

Transportation System, 5.50%, 06/15/39

    2,475       2,624,218  

New Jersey Transportation Trust Fund Authority, Refunding RB, Transportation System, Series A, 5.00%, 12/15/36

    180       193,480  
 

 

 

SCHEDULES OF INVESTMENTS      29  


Schedule of Investments  (unaudited) (continued)

January 31, 2019

  

BlackRock MuniYield Investment Fund (MYF)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
New Jersey (continued)  

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

  $ 3,610     $ 3,594,838  
   

 

 

 
      10,862,768  
New York — 1.7%  

Counties of New York Tobacco Trust IV, Refunding RB, Settlement Pass-Through Turbo, Series A,
6.25%, 06/01/41(a)

    1,100       1,125,267  

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

    1,650       1,713,244  

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

    475       505,025  
   

 

 

 
      3,343,536  
Ohio — 3.5%  

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

   

5.75%, 06/01/34

    310       289,698  

5.88%, 06/01/47

    1,775       1,648,425  

County of Allen Ohio Hospital Facilities Revenue, Refunding RB, Catholic Healthcare Partners, Series A, 5.25%, 06/01/20(b)

    3,115       3,254,178  

Ohio Housing Finance Agency, RB, S/F Housing, Series A (Ginnie Mae, Fannie Mae & Freddie Mac), 4.00%, 09/01/48

    310       311,336  

State of Ohio Turnpike Commission, RB, Junior Lien, Infrastructure Projects, Series A-1, 5.25%, 02/15/31

    1,000       1,113,340  
   

 

 

 
    6,616,977  
Oklahoma — 0.9%  

City of Oklahoma Turnpike Authority, RB, Series A,
4.00%, 01/01/48

    325       333,645  

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

    450       487,170  

Oklahoma Development Finance Authority, RB, OU Medicine Project, Series B, 5.25%, 08/15/48

    760       827,739  
   

 

 

 
    1,648,554  
Oregon — 0.1%  

State of Oregon Housing & Community Services Department, RB, S/F Housing, Mortgage Program, Series C, 3.95%, 07/01/43

    250       251,775  
   

 

 

 
Pennsylvania — 6.3%  

Allentown Neighborhood Improvement Zone Development Authority, RB, City Center Project, 5.00%, 05/01/42(a)

    585       618,117  

County of Berks IDA, Refunding RB, Tower Health Projects, 5.00%, 11/01/50

    915       988,895  

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

    560       559,983  

Pennsylvania Economic Development Financing Authority, RB, American Water Co. Project, 6.20%, 04/01/39

    1,075       1,081,945  

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

    1,000       1,034,690  

Pennsylvania HFA, Refunding RB, S/F Housing Mortgage:

   

Series 119, 3.50%, 10/01/36

    1,490       1,462,956  

Series 128B, 3.85%, 04/01/38(e)

    1,120       1,123,226  

Pennsylvania Turnpike Commission, RB:

   

Series A, 5.63%, 12/01/20(b)

    1,470       1,572,665  

Series A, 5.63%, 12/01/20(b)

    545       583,063  

Series C, 5.00%, 12/01/39

    620       677,821  

State Public School Building Authority, Refunding RB, The School District of Philadelphia Project, Series A, 5.00%, 06/01/34

    625       695,894  
Security   Par
(000)
    Value  
Pennsylvania (continued)  

Township of Bristol Pennsylvania School District, GO, 5.25%, 06/01/37

  $ 1,500     $ 1,658,325  
   

 

 

 
      12,057,580  
Puerto Rico — 0.6%  

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

   

5.50%, 05/15/39

    670       677,484  

5.63%, 05/15/43

    445       449,971  
   

 

 

 
      1,127,455  
Rhode Island — 2.2%  

Tobacco Settlement Financing Corp., Refunding RB:

   

Series A, 5.00%, 06/01/35

    525       550,169  

Series B, 4.50%, 06/01/45

    3,950       3,673,302  
   

 

 

 
      4,223,471  
South Carolina — 5.5%  

County of Charleston South Carolina, RB, Special Source, 5.25%, 12/01/38

    2,505       2,830,801  

County of Charleston South Carolina Airport District, ARB, Series A, AMT:

   

6.00%, 07/01/38

    1,955       2,224,868  

5.50%, 07/01/41

    1,000       1,110,340  

South Carolina Jobs-Economic Development Authority, Refunding RB, Prisma Health Obligated Group, 4.25%, 05/01/48

    1,615       1,625,966  

State of South Carolina Ports Authority, ARB, AMT:

   

5.00%, 07/01/36

    405       458,885  

5.00%, 07/01/55

    820       887,084  

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

    1,280       1,390,707  
   

 

 

 
      10,528,651  
Texas — 7.4%  

Central Texas Regional Mobility Authority, Refunding RB, Senior Lien(b):

   

5.75%, 01/01/21

    1,000       1,072,390  

6.00%, 01/01/21

    2,600       2,800,330  

County of Tarrant Texas Cultural Education Facilities Finance Corp., RB, Scott & White Healthcare, 6.00%, 08/15/20(b)

    3,515       3,738,519  

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

   

Series A, 5.00%, 11/01/38

    1,365       1,419,422  

Series H, 5.00%, 11/01/37

    1,535       1,620,960  

North Texas Tollway Authority, Refunding RB,
4.25%, 01/01/49

    720       740,974  

Red River Texas Education Financing Corp., RB, Texas Christian University Project, 5.25%, 03/15/38

    710       789,705  

Texas Department of Housing & Community Affairs, RB, S/F Housing Mortgage, Series A (Ginnie Mae), 4.25%, 09/01/43

    230       235,476  

Texas Private Activity Bond Surface Transportation Corp., RB, Senior Lien, NTE Mobility Partners LLC, North Tarrant Express Managed Lanes Project, 6.88%, 12/31/39

    1,700       1,764,447  
   

 

 

 
      14,182,223  
Virginia — 3.2%  

City of Lexington Virginia IDA, RB, Washington & Lee University, 5.00%, 01/01/43

    560       604,257  

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

   

5.50%, 05/15/19

    610       616,527  

5.50%, 05/15/19

    1,135       1,147,144  

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

    1,395       1,316,336  

Virginia Small Business Financing Authority, RB, AMT:

   

Covanta Project, 5.00%, 01/01/48(a)(d)

    585       595,852  
 

 

 

30    2019 BLACKROCK SEMI-ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (unaudited) (continued)

January 31, 2019

  

BlackRock MuniYield Investment Fund (MYF)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Virginia (continued)  

Senior Lien, Elizabeth River Crossings OpCo LLC Project,
6.00%, 01/01/37

  $ 1,715     $ 1,874,049  
   

 

 

 
      6,154,165  
West Virginia — 1.3%  

West Virginia Hospital Finance Authority, RB, Improvement, West Virginia University Health System Obligated Group, Series A,
4.00%, 06/01/51

    2,525       2,453,416  
   

 

 

 
Wisconsin — 1.7%  

Public Finance Authority, Refunding RB, Mery’s Wood at Marylhurst Projects, 5.25%, 05/15/52(a)

    1,015       1,044,435  

Wisconsin Housing & Economic Development Authority, RB, Series A:

   

4.30%, 11/01/53

    1,605       1,622,414  

4.45%, 05/01/57

    660       666,633  
   

 

 

 
      3,333,482  
   

 

 

 

Total Municipal Bonds — 101.7%
(Cost — $185,777,777)

 

    194,504,391  
   

 

 

 

Municipal Bonds Transferred to Tender Option Bond
Trusts(f) — 66.5%

 

Arizona — 0.6%  

County of Maricopa Industrial Development Authority, RB, Banner Health, Series A, 4.00%, 01/01/41

    1,065       1,091,401  
   

 

 

 
California — 20.4%  

Bay Area Toll Authority, Refunding RB, San Francisco Bay Area:

   

Toll Bridge, 4.00%, 04/01/42(g)

    1,998       2,046,642  

Series F-1, 5.63%, 04/01/19(b)

    2,681       2,698,566  

Grossmont California Union High School District, GO, Election of 2008, Series B, 5.00%, 08/01/20(b)

    6,000       6,306,780  

Los Angeles California Unified School District, GO, Series I,
5.00%, 01/01/34

    790       799,539  

Los Angeles Community College District California, GO, Election of 2008, Series C, 5.25%, 08/01/20(b)(g)

    5,251       5,535,713  

Los Angeles Community College District California, GO, Refunding, Election of 2008, Series A, 6.00%, 08/01/19(b)

    7,697       7,866,116  

Sacramento Area Flood Control Agency, Refunding, Consolidated Capital Assessment District No. 2 Bonds, 5.00%, 10/01/47

    1,980       2,221,675  

San Diego Public Facilities Financing Authority Water, RB, Series B, 5.50%, 08/01/19(b)

    8,412       8,576,372  

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

    3,001       3,035,837  
   

 

 

 
    39,087,240  
Colorado — 1.1%  

Colorado Health Facilities Authority, Refunding RB, Catholic Health Initiatives, Series A, 5.50%, 07/01/34(g)

    2,149       2,172,769  
   

 

 

 
District of Columbia — 1.8%  

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

    2,804       2,885,837  

District of Columbia Housing Finance Agency, RB, M/F Housing, Series B-2, 4.10%, 09/01/39

    610       617,900  
   

 

 

 
    3,503,737  
Florida — 1.9%  

City of Tampa Florida, RB, Baycare Health System, Series A, 4.00%, 11/15/46

    1,918       1,919,820  

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

    1,575       1,749,142  
   

 

 

 
    3,668,962  
Illinois — 0.5%  

Illinois Finance Authority, Refunding RB, Presence Health Network, Series C, 4.00%, 02/15/41

    914       922,308  
   

 

 

 
Security   Par
(000)
    Value  
Maine — 0.5%  

Maine State Housing Authority, RB, M/F Housing,
4.15%, 11/15/38

  $ 831     $ 853,872  
   

 

 

 
Michigan — 1.4%  

State of Michigan Housing Development Authority, RB, M/F Housing, Series A, 4.05%, 10/01/48

    2,756       2,737,220  
   

 

 

 
Nevada — 8.0%  

County of Clark Nevada, GO, Stadium Improvement, Series A, 5.00%, 05/01/48

    2,740       3,109,574  

County of Clark Nevada Water Reclamation District, GO, Series B, 5.50%, 07/01/19(b)

    5,668       5,757,947  

Las Vegas Valley Water District, GO, Refunding, Series C, 5.00%, 06/01/28

    6,070       6,488,587  
   

 

 

 
      15,356,108  
New Jersey — 1.5%  

New Jersey Housing & Mortgage Finance Agency, RB, S/F Housing, Series CC, 5.25%, 10/01/29

    1,801       1,806,824  

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

    1,000       1,042,478  
   

 

 

 
      2,849,302  
New York — 16.1%  

City of New York Housing Development Corp., Refunding RB, Sustainable Neighborhood Bonds, Series A, 4.15%, 11/01/38(e)

    1,280       1,321,703  

City of New York Municipal Water Finance Authority, Refunding RB:

   

Series FF, 5.00%, 06/15/45

    3,859       4,176,528  

Water & Sewer System, 2nd General Resolution, Series FF-2, 5.50%, 06/15/40

    2,505       2,538,567  

City of New York New York Municipal Water Finance Authority, Refunding RB, Water & Sewer System, 2nd General Resolution, Series BB, 5.25%, 06/15/44

    4,408       4,791,450  

Hudson Yards Infrastructure Corp., RB, Senior-Fiscal 2012(g):

   

5.75%, 02/15/21(b)

    799       860,381  

5.75%, 02/15/47

    491       529,280  

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

    2,996       3,320,450  

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

    4,365       4,738,493  

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

    2,560       2,801,138  

State of New York Dormitory Authority, ERB, Personal Income Tax, Series B, 5.25%, 03/15/19(b)

    5,700       5,724,111  
   

 

 

 
      30,802,101  
Pennsylvania — 1.9%  

Commonwealth of Pennsylvania, GO, 1st Series,
4.00%, 03/01/36(g)

    1,769       1,845,036  

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

    1,514       1,732,036  
   

 

 

 
    3,577,072  
Rhode Island — 0.4%  

Rhode Island Housing & Mortgage Finance Corp., Refunding RB, S/F Housing, Home Ownership Opportunity Bonds, Series 69-B (Ginnie Mae, Fannie Mae & Freddie Mac), 3.95%, 10/01/43

    840       841,151  
   

 

 

 
Texas — 8.4%  

City of San Antonio Texas Public Service Board, Refunding RB, Series A, 5.25%, 02/01/19(b)(g)

    3,989       3,989,079  

County of Harris Texas Cultural Education Facilities Finance Corp., RB, Texas Children’s Hospital Project, 5.50%, 10/01/39

    5,400       5,502,249  
 

 

 

SCHEDULES OF INVESTMENTS      31  


Schedule of Investments  (unaudited) (continued)

January 31, 2019

  

BlackRock MuniYield Investment Fund (MYF)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Texas (continued)  

County of Hidalgo Texas, GOL, Certificates of Obligation, Series A, 4.00%, 08/15/43

  $ 2,703     $ 2,729,244  

North Texas Tollway Authority, RB, Special Projects System, Series A, 5.50%, 09/01/21(b)

    3,480       3,801,204  
   

 

 

 
    16,021,776  
Utah — 1.1%  

City of Riverton Utah, RB, IHC Health Services, Inc.,
5.00%, 08/15/19(b)

    1,994       2,029,851  
   

 

 

 
Washington — 0.9%  

Washington Health Care Facilities Authority, Refunding RB, Multicare Health System, Series B, 4.13%, 08/15/43

    1,641       1,663,227  
   

 

 

 

Total Municipal Bonds Transferred to Tender Option Bond
Trusts — 66.5%
(Cost — $124,404,831)

 

    127,178,097  
   

 

 

 

Total Long-Term Investments — 168.2%
(Cost — $310,182,608)

 

    321,682,488  
   

 

 

 
     Shares         

Short-Term Securities — 0.1%

 

BlackRock Liquidity Funds, MuniCash, Institutional Class,
1.24% (h)(i)

    99,755       99,775  
   

 

 

 

Total Short-Term Securities — 0.1%
(Cost — $99,766)

 

    99,775  
   

 

 

 

Total Investments — 168.3%
(Cost — $310,282,374)

 

    321,782,263  

Other Assets Less Liabilities — 1.1%

 

    2,099,120  
         

Value

 

Liability for TOB Trust Certificates, Including Interest Expense and Fees Payable — (38.4)%

  $ (73,429,846

VRDP Shares at Liquidation Value, Net of Deferred Offering Costs — (31.0)%

    (59,237,699
   

 

 

 

Net Assets Applicable to Common Shares — 100.0%

  $ 191,213,838  
   

 

 

 

 

(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) 

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) 

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 February 1, 2019 to July 1, 2034 is $14,181,476. See Note 4 of the Notes to Financial Statements for details.

(h) 

Annualized 7-day yield as of period end.

 
(i) 

During the six months ended January 31, 2019, 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:

 

Affiliate    Shares
Held at
07/31/18
     Net
Activity
     Shares
Held at
01/31/19
     Value at
01/31/19
     Income     

Net

Realized
Gain (Loss)
 (a)

     Change in
Unrealized
Appreciation
(Depreciation)
 

BlackRock Liquidity Funds, MuniCash, Institutional Class

     2,045,731        (1,945,976      99,755      $ 99,775      $ 6,907      $ 94      $ (2
           

 

 

    

 

 

    

 

 

    

 

 

 

 

  (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

     17        03/20/19      $ 2,082      $ (42,935

Long U.S. Treasury Bond

     66        03/20/19        9,681        (417,071

5-Year U.S. Treasury Note

     17        03/29/19        1,953        (34,323
           

 

 

 
            $ (494,329
           

 

 

 

 

 

32    2019 BLACKROCK SEMI-ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (unaudited) (continued)

January 31, 2019

  

BlackRock MuniYield Investment Fund (MYF)

 

Derivative Financial Instruments Categorized by Risk Exposure

As of period 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  

Liabilities — Derivative Financial Instruments

                    

Futures contracts

                    

Net unrealized depreciation(a)

   $      $      $      $      $ 494,329      $      $ 494,329  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

  (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 six months ended January 31, 2019, 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

   $      $      $      $      $ 67,143      $      $ 67,143  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
Net Change in Unrealized Appreciation (Depreciation) on:                                                 

Futures contracts

   $      $      $      $      $ (497,316    $      $ (497,316
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

Futures contracts:

        

Average notional value of contracts — short

   $ 10,052,918  

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)

   $        $ 321,682,488        $        $ 321,682,488  

Short-Term Securities

     99,775                            99,775  
  

 

 

      

 

 

      

 

 

      

 

 

 
   $ 99,775        $ 321,682,488        $        $ 321,782,263  
  

 

 

      

 

 

      

 

 

      

 

 

 

Derivative Financial Instruments(b)

                 

Liabilities:

                 

Interest rate contracts

   $ (494,329      $        $        $ (494,329
  

 

 

      

 

 

      

 

 

      

 

 

 

 

  (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

   $        $ (73,078,479      $        $ (73,078,479

VRDP Shares at Liquidation Value

              (59,400,000                 (59,400,000
  

 

 

      

 

 

      

 

 

      

 

 

 
   $        $ (132,478,479      $        $ (132,478,479
  

 

 

      

 

 

      

 

 

      

 

 

 

During the six months ended January 31, 2019, there were no transfers between levels.

See notes to financial statements.

 

 

SCHEDULES OF INVESTMENTS      33  


Schedule of Investments  (unaudited)

January 31, 2019

  

BlackRock MuniYield New Jersey Fund, Inc. (MYJ)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  

Municipal Bonds — 132.5%

 

New Jersey — 130.6%

 

Corporate — 12.1%  

County of Middlesex New Jersey Improvement Authority, RB, Heldrich Center Hotel, Sub-Series B, 6.25%, 01/01/37(a)(b)

  $ 2,350     $ 24,675  

County of Salem New Jersey Pollution Control Financing Authority, Refunding RB, Atlantic City Electric, Series A,
4.88%, 06/01/29

    7,700       7,910,056  

New Jersey EDA, RB:

   

Continental Airlines, Inc. Project, Series A, AMT,
5.63%, 11/15/30

    1,730       1,949,693  

Continental Airlines, Inc. Project, Series B, AMT,
5.63%, 11/15/30

    7,195       8,112,362  

Motor Vehicle Surcharge, Series A (NPFGC),
5.25%, 07/01/25(c)

    415       497,672  

Motor Vehicle Surcharge, Series A (NPFGC),
5.25%, 07/01/25

    3,450       3,975,401  

Provident Group-Kean Properties, Series A, 5.00%, 07/01/47

    440       463,162  

New Jersey EDA, Refunding RB:

   

Duke Farms Foundation Project, 4.00%, 07/01/46

    2,255       2,343,306  

New Jersey American Water Co., Inc. Project, Series A, AMT,
5.70%, 10/01/39

    9,900       10,105,821  

New Jersey American Water Co., Inc. Project, Series B, AMT,
5.60%, 11/01/34

    4,100       4,251,700  

Provident Group-Monteclair Properites LLC (AGM),
5.00%, 06/01/37

    2,280       2,518,100  

Sub Series A, 5.00%, 07/01/33

    1,175       1,265,992  

Sub Series A, 4.00%, 07/01/34

    1,270       1,248,435  

Teaneck Community Charter School Project, Series A,
4.25%, 09/01/27(d)

    210       206,294  
   

 

 

 
      44,872,669  
County/City/Special District/School District — 21.5%  

Casino Reinvestment Development Authority, Refunding RB:

   

5.25%, 11/01/39

    2,280       2,425,966  

5.25%, 11/01/44

    12,000       12,749,280  

City of Bayonne New Jersey, GO, Refunding, Qualified General Improvement, (BAM):

   

5.00%, 07/01/33

    1,565       1,750,546  

5.00%, 07/01/35

    2,425       2,697,279  

City of Margate New Jersey, GO, Refunding, Improvement,
5.00%, 01/15/21(e)

    3,400       3,687,707  

City of Perth Amboy New Jersey, GO, CAB, Refunding (AGM),
5.00%, 07/01/33

    755       756,208  

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

    6,365       6,387,787  

County of Essex New Jersey Improvement Authority, Refunding RB, Project Consolidation (NPFGC):

   

5.50%, 10/01/28

    4,540       5,719,901  

5.50%, 10/01/29

    8,505       10,806,028  

County of Mercer New Jersey Improvement Authority, RB, Courthouse Annex Project, 5.00%, 09/01/40

    2,480       2,813,486  

County of Middlesex New Jersey, COP, Refunding, Civic Square IV Redevelopment, 5.00%, 10/15/31

    2,840       3,382,213  

County of Union New Jersey Improvement Authority, LRB, Guaranteed Lease, Family Court Building Project,
5.00%, 05/01/42

    2,320       2,513,001  

County of Union New Jersey Utilities Authority, Refunding RB, Resources Recovery Facility, Covanta Union, Inc., AMT,
Series A, 5.25%, 12/01/31

    670       726,803  

Ewing Township Board of Education, GO:

   

4.00%, 07/15/38

    1,190       1,232,638  

4.00%, 07/15/39

    1,090       1,123,757  
Security   Par
(000)
    Value  
County/City/Special District/School District (continued)  

Monroe Township Board of Education Middlesex County, GO, Refunding, 5.00%, 03/01/38

  $ 2,750     $ 3,093,942  

New Jersey EDA, RB:

   

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

    5,000       5,596,700  

Series EEE, 5.00%, 06/15/43

    4,450       4,676,104  

State House Project, Series B, Remark 10, 5.00%, 06/15/43

    2,235       2,348,560  

New Jersey EDA, Refunding RB, Special Assessment, Kapkowski Road Landfill Project, 6.50%, 04/01/28

    4,750       5,442,835  
   

 

 

 
      79,930,741  
Education — 22.7%  

County of Atlantic New Jersey Improvement Authority, RB, Stockton University Atlantic City, Series A (AGM),
4.00%, 07/01/46

    950       969,693  

New Jersey EDA, RB:

   

Foundation Academy Charter School Project, Series A,
5.00%, 07/01/38

    160       168,090  

Foundation Academy Charter School Project, Series A,
5.00%, 07/01/50

    410       426,724  

Golden Door Charter School Project, Series A,
6.25%, 11/01/38(d)

    440       467,315  

Golden Door Charter School Project, Series A,
6.50%, 11/01/52(d)

    2,490       2,650,456  

Golden Door Charter School Project, Series A,
5.13%, 11/01/29(d)

    150       152,694  

Hatikvah International Academy Charter School Project, Series A, 5.00%, 07/01/27(d)

    330       339,105  

Hatikvah International Academy Charter School Project, Series A, 5.25%, 07/01/37(d)

    1,030       1,031,339  

Hatikvah International Academy Charter School Project, Series A, 5.38%, 07/01/47(d)

    1,685       1,671,570  

MSU Student Housing Project Provide, 5.75%, 06/01/20(e)

    1,000       1,053,220  

MSU Student Housing Project Provide, 5.88%, 06/01/20(e)

    3,000       3,164,550  

Team Academi Charter School Project, Series A,
5.00%, 12/01/48

    4,475       4,683,401  

Team Academy Charter School Project, 6.00%, 10/01/33

    4,780       5,302,311  

New Jersey EDA, Refunding RB, Series A(d):

   

Greater Brunswick Charter School, Inc. Project,
5.63%, 08/01/34

    630       633,389  

Greater Brunswick Charter School, Inc. Project,
5.88%, 08/01/44

    1,070       1,072,226  

Greater Brunswick Charter School, Inc. Project,
6.00%, 08/01/49

    555       556,282  

Teaneck Community Charter School Project,
5.00%, 09/01/37

    805       789,697  

Teaneck Community Charter School Project,
5.13%, 09/01/52

    1,700       1,645,719  

New Jersey Educational Facilities Authority, RB:

   

Higher Educational Capital Improvement Fund, Series A,
5.00%, 09/01/32

    4,000       4,263,840  

Rider University Issue, Series F, 4.00%, 07/01/42

    1,945       1,829,253  

Rider University Issue, Series F, 5.00%, 07/01/47

    1,385       1,466,784  

New Jersey Educational Facilities Authority, Refunding RB:

   

Kean University, Series A, 5.50%, 09/01/19(e)

    7,260       7,420,881  

Montclair State University, Series A, 5.00%, 07/01/44

    12,960       14,251,723  

New Jersey Institute of Technology, Series H,
5.00%, 07/01/31

    2,120       2,200,984  

Ramapo College, Series B, 5.00%, 07/01/42

    690       744,896  

Rider University, Series A, 5.00%, 07/01/32

    1,000       1,034,790  

Seton Hall University, Series D, 5.00%, 07/01/38

    500       551,415  

Stevens Institute of Technology, Series A, 4.00%, 07/01/47

    955       969,984  

University of Medicine & Dentistry, Series B,
7.13%, 06/01/19(e)

    1,300       1,323,049  
 

 

 

34    2019 BLACKROCK SEMI-ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (unaudited) (continued)

January 31, 2019

  

BlackRock MuniYield New Jersey Fund, Inc. (MYJ)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Education (continued)  

University of Medicine & Dentistry, Series B,
7.50%, 06/01/19(e)

  $ 1,000     $ 1,018,940  

New Jersey Higher Education Student Assistance Authority, RB, Student Loan, AMT:

   

Sub-Series C, 4.00%, 12/01/48

    1,450       1,415,345  

Series 1A, 5.00%, 12/01/22

    915       999,665  

New Jersey Higher Education Student Assistance Authority, Refunding RB:

   

Series 1, AMT, 5.75%, 12/01/29

    3,045       3,241,951  

Series 1A, 5.00%, 12/01/25

    780       798,057  

Series 1A, 5.00%, 12/01/26

    500       511,495  

Series 1A, 5.25%, 12/01/32

    1,700       1,742,534  

Student Loan, Series 1A, 5.13%, 12/01/27

    135       138,185  

New Jersey Institute of Technology, RB, Series A:

   

5.00%, 07/01/40

    3,000       3,390,060  

5.00%, 07/01/42

    2,455       2,647,005  

5.00%, 07/01/45

    4,500       5,071,005  

New Jersey State Turnpike Authority, RB, Series E, 5.00%, 01/01/45

    720       790,870  
   

 

 

 
      84,600,492  
Health — 10.2%  

County of Burlington New Jersey Bridge Commission, Refunding RB, The Evergreens Project, 5.63%, 01/01/38

    1,700       1,615,493  

County of Camden New Jersey Improvement Authority, Refunding RB, 5.00%, 02/15/34

    590       633,306  

New Jersey EDA, RB, Reunding Cranes Mill Project:

   

5.00%, 01/01/34

    555       605,455  

5.00%, 01/01/39

    555       594,383  

5.00%, 01/01/49

    1,105       1,167,742  

New Jersey Health Care Facilities Financing Authority, RB:

   

Inspira Health Obligated Group, 5.00%, 07/01/42

    1,685       1,870,266  

Robert Wood Johnson University Hospital, Series A, 5.50%, 07/01/43

    2,400       2,662,704  

Virtua Health, Series A (AGC), 5.50%, 07/01/38

    4,150       4,210,880  

New Jersey Health Care Facilities Financing Authority, Refunding RB:

   

AHS Hospital Corp., 6.00%, 07/01/21(e)

    4,990       5,491,645  

AHS Hospital Corp., 4.00%, 07/01/41

    1,400       1,419,894  

Princeton Healthcare System, 5.00%, 07/01/34

    860       972,256  

Princeton Healthcare System, 5.00%, 07/01/39

    2,530       2,810,552  

Robert Wood Johnson University Hospital, 5.00%, 01/01/20(e)

    1,000       1,029,240  

RWJ Barnabas Health Obligated Group, Series A, 4.00%, 07/01/43

    1,635       1,668,615  

RWJ Barnabas Health Obligated Group, Series A, 5.00%, 07/01/43

    3,305       3,699,154  

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

    6,990       7,622,455  
   

 

 

 
      38,074,040  
Housing — 4.6%  

New Jersey Housing & Mortgage Finance Agency, RB:

   

M/F Housing, Series A, 4.75%, 11/01/29

    3,860       3,912,149  

S/F Housing, Series CC, 5.00%, 10/01/34

    2,200       2,208,646  

New Jersey Housing & Mortgage Finance Agency, Refunding RB:

   

M/F Housing, Series A, 4.00%, 11/01/48

    305       305,656  

M/F Housing, Series A, 4.10%, 11/01/53

    180       181,044  

S/F Housing, Series A, 3.75%, 10/01/35

    5,190       5,224,202  

Series D, AMT, 4.25%, 11/01/37

    1,260       1,288,325  

Newark Housing Authority, RB:

   

M/F Housing, Series A, 5.00%, 12/01/30

    2,000       2,248,140  

South Ward Police Facility (AGC), 6.75%, 12/01/19(e)

    1,750       1,822,782  
   

 

 

 
      17,190,944  
Security   Par
(000)
    Value  
State — 9.1%  

Garden State Preservation Trust, RB, CAB, Series B (AGM)(f):

   

0.00%, 11/01/23

  $ 1,460     $ 1,308,131  

0.00%, 11/01/26

    6,000       4,882,500  

0.00%, 11/01/27

    4,000       3,139,560  

0.00%, 11/01/28

    4,540       3,429,607  

New Jersey EDA, RB, School Facilities Construction, Series CC-2, 5.00%, 12/15/31

    1,125       1,153,440  

New Jersey EDA, Refunding RB:

   

Cigarette Tax, 5.00%, 06/15/26

    1,250       1,337,662  

Cigarette Tax, 5.00%, 06/15/28

    975       1,036,601  

Cigarette Tax, 5.00%, 06/15/29

    2,260       2,396,820  

Cigarette Tax (AGM), 5.00%, 06/15/22

    3,690       4,004,388  

School Facilities Construction, 5.25%, 06/15/19(e)

    265       268,469  

School Facilities Construction, Series AA, 5.25%, 06/15/19(e)

    70       70,916  

School Facilities Construction, Series AA, 5.50%, 06/15/19(e)

    2,340       2,372,737  

School Facilities Construction, Series AA, 5.50%, 12/15/29

    1,160       1,173,839  

School Facilities Construction, Series AA, 5.25%, 12/15/33

    665       671,896  

School Facilities Construction, Series GG, 5.25%, 09/01/27

    4,295       4,500,258  

State of New Jersey, COP, Equipment Lease Purchase, Series A, 5.25%, 06/15/19(e)

    1,900       1,924,871  
   

 

 

 
      33,671,695  
Tobacco — 3.5%  

Tobacco Settlement Financing Corp., Refunding RB:

   

Series A, 5.25%, 06/01/46

    1,595       1,686,425  

Sub-Series B, 5.00%, 06/01/46

    11,375       11,327,225  
   

 

 

 
      13,013,650  
Transportation — 45.3%  

Delaware River Port Authority of Pennsylvania & New Jersey, RB:

   

5.00%, 01/01/40

    4,000       4,389,320  

Series D, 5.00%, 01/01/20(e)

    2,585       2,662,964  

New Jersey EDA, RB, Goethals Bridge Replacement Project, AMT, Private Activity Bond:

   

5.38%, 01/01/43

    15,780       16,948,509  

(AGM), 5.00%, 01/01/31

    1,000       1,085,390  

New Jersey EDA, Refunding RB, AMT, 5.00%, 10/01/37

    2,750       2,934,910  

New Jersey EDA, RB, Reunding Series B, 5.00%, 11/01/19

    3,000       3,066,300  

New Jersey State Turnpike Authority, RB, Series A:

   

5.00%, 07/01/22(e)

    17,015       18,878,483  

5.00%, 01/01/35

    1,060       1,209,842  

New Jersey State Turnpike Authority, Refunding RB:

   

Series A, 5.00%, 01/01/22(e)

    1,000       1,094,130  

Series B, 5.00%, 01/01/34

    1,150       1,335,426  

Series G, 4.00%, 01/01/43

    1,445       1,475,403  

New Jersey Transportation Trust Fund Authority, RB:

   

CAB, Transportation System, Series C (AGM),
0.00%, 12/15/32(f)

    5,250       3,106,897  

CAB, Transportation System, Series C (AMBAC),
0.00%, 12/15/35(f)

    4,140       1,993,783  

Federal Highway Reimbursement Revenue Notes, Series A, 5.00%, 06/15/30

    2,000       2,224,740  

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

    9,490       9,948,272  

Transportation Program, Series AA, 5.25%, 06/15/41

    5,000       5,290,250  

Transportation System, Series A, 6.00%, 06/15/35

    11,440       12,230,618  

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

    8,330       8,685,191  

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

    6,885       7,084,045  

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

    8,205       8,699,679  

New Jersey Transportation Trust Fund Authority, Refunding RB, Series A:

   

Federal Highway Reimbursement, 5.00%, 06/15/31

    5,540       6,124,304  
 

 

 

SCHEDULES OF INVESTMENTS      35  


Schedule of Investments  (unaudited) (continued)

January 31, 2019

  

BlackRock MuniYield New Jersey Fund, Inc. (MYJ)

(Percentages shown are based on Net Assets)

 

Security   Par
(000)
    Value  
Transportation (continued)  

Transportation System, 5.00%, 12/15/32

  $ 3,530     $ 3,848,300  

Transportation System, 5.00%, 12/15/35

    2,015       2,174,407  

New Jersey Turnpike Authority, Refunding RB, Series E, 5.00%, 01/01/32

    7,000       8,212,610  

Port Authority of New York & New Jersey, ARB:

   

Consolidated, 169th Series, 5.00%, 10/15/41

    250       266,263  

Consolidated, 93rd Series, 6.13%, 06/01/94

    5,000       5,925,600  

JFK International Air Terminal, Series 8, 6.00%, 12/01/42

    4,580       4,848,022  

Port Authority of New York & New Jersey, Refunding ARB, Consolidated:

   

166th Series, 5.25%, 07/15/36

    8,500       9,013,145  

172nd Series, AMT, 5.00%, 10/01/34

    2,500       2,662,700  

206th Series, AMT, 5.00%, 11/15/42

    1,365       1,521,838  

206th Series, AMT, 5.00%, 11/15/47

    1,525       1,694,122  

South Jersey Port Corp., Refunding ARB, Marine Terminal, Series B, 5.00%, 01/01/48

    7,620       8,057,236  
   

 

 

 
      168,692,699  
Utilities — 1.6%  

Rahway Valley Sewerage Authority, RB, CAB, Series A (NPFGC)(f):

   

0.00%, 09/01/31

    6,000       4,095,480  

0.00%, 09/01/33

    2,650       1,665,975  
   

 

 

 
      5,761,455  
   

 

 

 

Total Municipal Bonds in New Jersey

 

    485,808,385  
   

 

 

 
New York — 1.4%  

Port Authority of New York & New Jersey, ARB, JFK International Air Terminal LLC, Special Project, Series 6, AMT (NPFGC), 5.75%, 12/01/22

    4,930       5,129,172  
   

 

 

 

Total Municipal Bonds in New York

 

    5,129,172  
   

 

 

 

Puerto Rico — 0.5%

 

Tobacco — 0.5%  

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

   

5.50%, 05/15/39

    1,180       1,193,181  

5.63%, 05/15/43

    790       798,824  
   

 

 

 

Total Municipal Bonds in Puerto Rico

 

    1,992,005  
   

 

 

 

Total Municipal Bonds — 132.5%
(Cost — $471,965,281)

 

    492,929,562  
   

 

 

 

Municipal Bonds Transferred to Tender Option Bond
Trusts(g) — 29.5%

 

New Jersey — 29.5%

 

County/City/Special District/School District — 8.7%  

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

    2,560       2,877,337  

County of Union New Jersey Utilities Authority, Refunding RB, Series A, AMT:

   

County Deficiency Agreement, 5.00%, 06/15/41

    6,982       7,439,910  

Resource Recovery Facility, Covanta Union, Inc., 5.25%, 12/01/31

    20,310       22,012,283  
   

 

 

 
      32,329,530  
Education — 4.2%  

Rutgers — The State University of New Jersey, Refunding RB:

   

Series F, 5.00%, 05/01/19(e)

    4,502       4,538,954  

Series L, 5.00%, 05/01/43

    10,000       11,059,500  
   

 

 

 
      15,598,454  
Security   Par
(000)
    Value  
Health — 1.5%  

New Jersey Health Care Facilities Financing Authority, RB, Inspira Health Obligated Group, 4.00%, 07/01/47

  $ 5,555     $ 5,642,180  
   

 

 

 
State — 4.1%  

Garden State Preservation Trust, RB, Election of 2005, Series A (AGM), 5.75%, 11/01/28

    5,460       6,583,722  

New Jersey EDA, Refunding RB, School Facilities Construction, Series NN, 5.00%, 03/01/29(h)

    8,017       8,557,526  
   

 

 

 
      15,141,248  
Transportation — 11.0%  

New Jersey State Turnpike Authority, RB, Series A, 5.00%, 01/01/38(e)(h)

    13,520       14,948,591  

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

    8,502       8,861,065  

Port Authority of New York & New Jersey, Refunding ARB, Consolidated, 169th Series, AMT, 5.00%, 10/15/41

    16,255       17,294,492  
   

 

 

 
    41,104,148  
   

 

 

 

Total Municipal Bonds Transferred to Tender Option Bond
Trusts — 29.5%
(Cost — $104,223,221)

 

    109,815,560  
   

 

 

 

Total Long-Term Investments — 162.0%
(Cost — $576,188,502)

 

    602,745,122  
   

 

 

 
     Shares         
Short-Term Securities — 2.4%  

BlackRock Liquidity Funds, MuniCash, Institutional Class, 1.24%(i)(j)

    8,723,282       8,725,026  
   

 

 

 

Total Short-Term Securities — 2.4%
(Cost — $8,724,327)

 

    8,725,026  
   

 

 

 

Total Investments — 164.4%
(Cost — $584,912,829)

 

    611,470,148  

Other Assets Less Liabilities — 0.9%

 

    3,625,058  

Liability for TOB Trust Certificates, Including Interest Expense and Fees Payable — (17.0)%

 

    (63,349,205

VRDP Shares at Liquidation Value, Net of Deferred Offering
Costs — (48.3)%

 

    (179,698,197
   

 

 

 

Net Assets Applicable to Common Shares — 100.0%

 

  $ 372,047,804  
   

 

 

 

 

(a) 

Issuer filed for bankruptcy and/or is in default.

(b) 

Non-income producing security.

(c) 

Security is collateralized by municipal bonds or U.S. Treasury obligations.

(d) 

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.

(e) 

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.

(f) 

Zero-coupon bond.

(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 June 15, 2019 to September 1, 2020 is $ 22,639,581. See Note 4 of the Notes to Financial Statements for details.

(i) 

Annualized 7-day yield as of period end.

 

 

 

36    2019 BLACKROCK SEMI-ANNUAL REPORT TO SHAREHOLDERS


Schedule of Investments  (unaudited) (continued)

January 31, 2019

  

BlackRock MuniYield New Jersey Fund, Inc. (MYJ)

 

(j) 

During the six months ended January 31, 2019, 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:

 

Affiliate    Shares
Held at
07/31/18
     Net
Activity
     Shares
Held at
01/31/19
     Value at
01/31/19
     Income      Net
Realized
Gain (Loss) (a)
     Change in
Unrealized
Appreciation
(Depreciation)
 

BlackRock Liquidity Funds, MuniCash, Institutional Class

     391,750        8,331,532        8,723,282      $ 8,725,026      $ 31,394      $ 315      $ 699  
           

 

 

    

 

 

    

 

 

    

 

 

 

 

  (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

     93        03/20/19      $ 11,390      $ (258,117

Long U.S. Treasury Bond

     129        03/20/19        18,923        (820,509

5-Year U.S. Treasury Note

     55        03/29/19        6,317        (112,167
           

 

 

 
            $ (1,190,793
           

 

 

 

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.

Derivative Financial Instruments Categorized by Risk Exposure

As of period 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  

Liabilities — Derivative Financial Instruments

                    

Futures contracts

                    

Net unrealized depreciation(a)

   $      $      $      $      $ 1,190,793      $      $ 1,190,793  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

  (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 six months ended January 31, 2019, 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

   $      $      $      $      $ 277,591      $      $ 277,591  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net Change in Unrealized Appreciation (Depreciation) on:

                    

Futures contracts

   $      $      $      $      $ (1,265,507    $      $ (1,265,507
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Average Quarterly Balances of Outstanding Derivative Financial Instruments

 

Futures contracts:

        

Average notional value of contracts — short

   $ 26,397,781  

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

 

 

SCHEDULES OF INVESTMENTS      37  


Schedule of Investments  (unaudited) (continued)

January 31, 2019

  

BlackRock MuniYield New Jersey Fund, Inc. (MYJ)

 

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)

   $      $ 602,745,122      $      $ 602,745,122  

Short-Term Securities

     8,725,026                      8,725,026  
  

 

 

    

 

 

    

 

 

    

 

 

 
   $ 8,725,026      $ 602,745,122      $        $ 611,470,148  
  

 

 

    

 

 

    

 

 

    

 

 

 

Derivative Financial Instruments(b)

           

Liabilities:

           

Interest rate contracts

   $ (1,190,793    $      $      $ (1,190,793
  

 

 

    

 

 

    

 

 

    

 

 

 

 

  (a) 

See above Schedule of Investments for values in each sector.

 
  (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

   $      $ (63,137,619    $      $ (63,137,619

VRDP Shares at Liquidation Value

            (180,000,000             (180,000,000
  

 

 

    

 

 

    

 

 

    

 

 

 
   $      $ (243,137,619    $      $ (243,137,619
  

 

 

    

 

 

    

 

 

    

 

 

 

During the six months ended January 31, 2019, there were no transfers between levels.

See notes to financial statements.

 

 

38    2019 BLACKROCK SEMI-ANNUAL REPORT TO SHAREHOLDERS


Statements of Assets and Liabilities  (unaudited)

January 31, 2019

 

     MNE      MZA      MYC      MYF      MYJ  

ASSETS

             

Investments at value — unaffiliated(a)

  $ 104,335,170      $ 105,668,272      $ 535,293,532      $ 321,682,488      $ 602,745,122  

Investments at value — affiliated(b)

    357,604        1,257,771               99,775        8,725,026  

Cash pledged for futures contracts

    61,450        71,000        451,500        202,550        482,150  

Receivables:

             

Interest — unaffiliated

    1,146,197        656,698        7,289,089        3,895,334        5,046,848  

Dividends — affiliated

    319        870        494        958        9,632  

Investments sold

                         587,650         

TOB Trust

                         940,000         

Prepaid expenses

    3,811        4,449        5,350        4,589        5,809  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total assets

    105,904,551        107,659,060        543,039,965        327,413,344        617,014,587  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

ACCRUED LIABILITIES

             

Bank overdraft

                  45,558                

Payables:

             

Investments purchased

           579,630               2,372,758         

Income dividend distributions — Common Shares

    168,394        217,921        1,113,814        849,570        1,461,565  

Investment advisory fees

    49,260        45,224        229,694        137,504        254,966  

Interest expense and fees

    59,851        6,242        565,037        351,367        211,586  

Directors’ and Officer’s fees

    461        471        3,827        2,202        35,258  

Variation margin on futures contracts

    24,001        27,843        176,569        78,617        187,647  

Other accrued expenses

    59,670        59,169        119,513        91,310        144,241  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total accrued liabilities

    361,637        936,500        2,254,012        3,883,328        2,295,263  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

OTHER LIABILITIES

             

TOB Trust Certificates

    13,360,377        5,000,000        119,600,027        73,078,479        63,137,619  

VRDP Shares, at liquidation value of $100,000 per share, net of deferred offering costs(c)(d)(e)

    29,463,685        37,155,310        105,703,144        59,237,699        179,698,197  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total other liabilities

    42,824,062        42,155,310        225,303,171        132,316,178        242,835,816  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total liabilities

    43,185,699        43,091,810        227,557,183        136,199,506        244,966,783  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

  $ 62,718,852      $ 64,567,250      $ 315,482,782      $ 191,213,838      $ 372,047,804  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS CONSIST OF

             

Paid-in capital(f)(g)

  $ 59,562,176      $ 60,975,542      $ 303,340,659      $ 183,701,102      $ 347,611,511  

Accumulated earnings

    3,156,676        3,591,708        12,142,123        7,512,736        24,436,293  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

  $ 62,718,852      $ 64,567,250      $ 315,482,782      $ 191,213,838      $ 372,047,804  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net asset value per Common Share

  $ 14.90      $ 13.93      $ 14.73      $ 13.95      $ 15.40  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

(a) Investments at cost — unaffiliated

  $ 100,837,721      $ 102,010,526      $ 521,776,375      $ 310,182,608      $ 576,188,502  

(b) Investments at cost — affiliated

  $ 357,604      $ 1,257,711      $      $ 99,766      $ 8,724,327  

(c) Preferred Shares outstanding, par value $0.10 per share

    296        373        1,059               1,800  

(d) Preferred Shares outstanding, par value $0.05 per share

                         594         

(e) Preferred Shares authorized

    1,536        1,985        8,059        1,000,000        5,782  

(f)  Common Shares outstanding, par value $0.10 per share

    4,209,844        4,636,620        21,419,494        13,702,745        24,158,105  

(g) Common Shares authorized

    199,998,464        199,998,015        199,991,941        Unlimited        199,994,218  

See notes to financial statements.

 

 

FINANCIAL STATEMENTS      39  


Statements of Operations  (unaudited)

Six Months Ended January 31, 2019

 

      MNE     MZA     MYC     MYF     MYJ  

INVESTMENT INCOME

          

Interest — unaffiliated

   $ 1,910,522     $ 2,145,593     $ 10,335,353     $ 7,678,993     $ 13,513,342  

Dividends — affiliated

     3,278       5,504       9,864       6,907       31,394  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total investment income

     1,913,800       2,151,097       10,345,217       7,685,900       13,544,736  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

EXPENSES

          

Investment advisory

     289,989       264,927       1,362,400       830,884       1,558,931  

Professional

     23,899       21,897       42,817       35,924       39,840  

Rating agency

     21,720       21,723       21,742       21,728       21,765  

Accounting services

     13,019       13,626       35,891       25,799       45,131  

Transfer agent

     8,287       8,822       14,887       12,923       18,087  

Registration

     4,778       1,104       4,852       4,778       4,778  

Printing

     3,180       2,833       3,932       3,534       9,786  

Directors and Officer

     3,018       3,114       15,497       9,359       18,512  

Custodian

     1,298       1,423       11,154       4,307       11,246  

Miscellaneous

     9,199       8,626       11,032       8,774       13,162  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total expenses excluding interest expense, fees and amortization of offering costs

     378,387       348,095       1,524,204       958,010       1,741,238  

Interest expense, fees and amortization of offering costs(a)

     509,149       498,460       2,580,506       1,581,818       2,978,916  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total expenses

     887,536       846,555       4,104,710       2,539,828       4,720,154  

Less fees waived and/or reimbursed by the Manager

     (133     (338     (447     (461     (33,174
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total expenses after fees waived and/or reimbursed

     887,403       846,217       4,104,263       2,539,367       4,686,980  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net investment income

     1,026,397       1,304,880       6,240,954       5,146,533       8,857,756  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

REALIZED AND UNREALIZED GAIN (LOSS)

          

Net realized gain (loss) from:

          

Investments — unaffiliated

     (28,470     23,859       (721,577     524,854       (131,060

Investments — affiliated

     9       10       (331     83       315  

Futures contracts

     29,621       35,278       293,787       67,143       277,591  

Capital gain distributions from investment companies — affiliated

           27             11       2  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
     1,160       59,174       (428,121     592,091       146,848  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net change in unrealized appreciation (depreciation) on:

          

Investments — unaffiliated

     46,892       (388,922     (2,968,220     (4,364,275     (3,100,523

Investments — affiliated

     (115     20       (214     (2     699  

Futures contracts

     (165,962     (180,152     (1,180,678     (497,316     (1,265,507
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
     (119,185     (569,054     (4,149,112     (4,861,593     (4,365,331
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net realized and unrealized loss

     (118,025     (509,880     (4,577,233     (4,269,502     (4,218,483
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

NET INCREASE IN NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS RESULTING FROM OPERATIONS

   $ 908,372     $ 795,000     $ 1,663,721     $ 877,031     $ 4,639,273  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

(a) 

Related to TOB Trusts and/or VRDP Shares.

See notes to financial statements.

 

 

40    2019 BLACKROCK SEMI-ANNUAL REPORT TO SHAREHOLDERS


Statements of Changes in Net Assets

 

    MNE  
     Six Months Ended
01/31/19
(unaudited)
   

Year Ended

07/31/18

 

INCREASE (DECREASE) IN NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

   

OPERATIONS

   

Net investment income

  $ 1,026,397     $ 2,204,910  

Net realized gain

    1,160       453,626  

Net change in unrealized appreciation (depreciation)

    (119,185     (2,549,754
 

 

 

   

 

 

 

Net increase in net assets applicable to Common Shareholders resulting from operations

    908,372       108,782  
 

 

 

   

 

 

 

DISTRIBUTIONS TO COMMON SHAREHOLDERS(a)(b)

   

Decrease in net assets resulting from distributions to shareholders

    (1,270,822     (2,153,335
 

 

 

   

 

 

 

NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS(b)

   

Total decrease in net assets applicable to Common Shareholders

    (362,450     (2,044,553

Beginning of period

    63,081,302       65,125,855  
 

 

 

   

 

 

 

End of period

  $ 62,718,852     $ 63,081,302  
 

 

 

   

 

 

 

 

(a) 

Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

(b) 

Prior year distribution character information and undistributed net investment income has been modified or removed to conform with current year Regulation S-X presentation changes. Refer to Note 11 for this prior year information.

See notes to financial statements.

 

 

FINANCIAL STATEMENTS      41  


Statements of Changes in Net Assets  (continued)

 

    MZA  
     Six Months Ended
01/31/19
(unaudited)
    Year Ended
07/31/18
 

INCREASE (DECREASE) IN NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

   

OPERATIONS

   

Net investment income

  $ 1,304,880     $ 3,057,270  

Net realized gain

    59,174       294,454  

Net change in unrealized appreciation (depreciation)

    (569,054     (2,486,970
 

 

 

   

 

 

 

Net increase in net assets applicable to Common Shareholders resulting from operations

    795,000       864,754  
 

 

 

   

 

 

 

DISTRIBUTIONS TO COMMON SHAREHOLDERS(a)(b)

   

Decrease in net assets resulting from distributions to shareholders

    (1,400,254     (3,213,774
 

 

 

   

 

 

 

CAPITAL SHARE TRANSACTIONS

   

Reinvestment of common distributions

    19,555       155,879  
 

 

 

   

 

 

 

NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS(b)

   

Total decrease in net assets applicable to Common Shareholders

    (585,699     (2,193,141

Beginning of period

    65,152,949       67,346,090  
 

 

 

   

 

 

 

End of period

  $ 64,567,250     $ 65,152,949  
 

 

 

   

 

 

 

 

(a) 

Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

(b) 

Prior year distribution character information and undistributed net investment income has been modified or removed to conform with current year Regulation S-X presentation changes. Refer to Note 11 for this prior year information.

See notes to financial statements.

 

 

42    2019 BLACKROCK SEMI-ANNUAL REPORT TO SHAREHOLDERS


Statements of Changes in Net Assets  (continued)

 

    MYC  
     Six Months Ended
01/31/19
(unaudited)
   

Year Ended

07/31/18

 

INCREASE (DECREASE) IN NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

   

OPERATIONS

   

Net investment income

  $ 6,240,954     $ 14,196,507  

Net realized gain (loss)

    (428,121     3,689,853  

Net change in unrealized appreciation (depreciation)

    (4,149,112     (12,458,189
 

 

 

   

 

 

 

Net increase in net assets applicable to Common Shareholders resulting from operations

    1,663,721       5,428,171  
 

 

 

   

 

 

 

DISTRIBUTIONS TO COMMON SHAREHOLDERS(a)(b)

   

Decrease in net assets resulting from distributions to shareholders

    (9,925,986     (16,139,231
 

 

 

   

 

 

 

NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS(b)

   

Total decrease in net assets applicable to Common Shareholders

    (8,262,265     (10,711,060

Beginning of period

    323,745,047       334,456,107  
 

 

 

   

 

 

 

End of period

  $ 315,482,782     $ 323,745,047  
 

 

 

   

 

 

 

 

(a) 

Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

(b) 

Prior year distribution character information and undistributed net investment income has been modified or removed to conform with current year Regulation S-X presentation changes. Refer to Note 11 for this prior year information.

See notes to financial statements.

 

 

FINANCIAL STATEMENTS      43  


Statements of Changes in Net Assets  (continued)

 

    MYF  
     Six Months Ended
01/31/19
(unaudited)
   

Year Ended

07/31/18

 

INCREASE (DECREASE) IN NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

   

OPERATIONS

   

Net investment income

  $ 5,146,533     $ 11,416,297  

Net realized gain

    592,091       1,164,129  

Net change in unrealized appreciation (depreciation)

    (4,861,593     (9,566,884
 

 

 

   

 

 

 

Net increase in net assets applicable to Common Shareholders resulting from operations

    877,031       3,013,542  
 

 

 

   

 

 

 

DISTRIBUTIONS TO COMMON SHAREHOLDERS(a)(b)

   

Decrease in net assets resulting from distributions to shareholders

    (5,508,002     (11,897,107
 

 

 

   

 

 

 

CAPITAL SHARE TRANSACTIONS

   

Reinvestment of common distributions

    67,480       233,598  
 

 

 

   

 

 

 

NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS(b)

   

Total decrease in net assets applicable to Common Shareholders

    (4,563,491     (8,649,967

Beginning of period

    195,777,329       204,427,296  
 

 

 

   

 

 

 

End of period

  $ 191,213,838     $ 195,777,329  
 

 

 

   

 

 

 

 

(a) 

Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

(b) 

Prior year distribution character information and undistributed net investment income has been modified or removed to conform with current year Regulation S-X presentation changes. Refer to Note 11 for this prior year information.

See notes to financial statements.

 

 

44    2019 BLACKROCK SEMI-ANNUAL REPORT TO SHAREHOLDERS


Statements of Changes in Net Assets  (continued)

 

    MYJ  
     Six Months Ended
01/31/19
(unaudited)
    Year Ended
07/31/18
 

INCREASE (DECREASE) IN NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS

   

OPERATIONS

   

Net investment income

  $ 8,857,756     $ 12,207,324  

Net realized gain

    146,848       1,678,748  

Net change in unrealized appreciation (depreciation)

    (4,365,331     (4,573,330
 

 

 

   

 

 

 

Net increase in net assets applicable to Common Shareholders resulting from operations

    4,639,273       9,312,742  
 

 

 

   

 

 

 

DISTRIBUTIONS TO COMMON SHAREHOLDERS(a)(b)

   

Decrease in net assets resulting from distributions to shareholders

    (8,769,392     (13,214,077
 

 

 

   

 

 

 

CAPITAL SHARE TRANSACTIONS

   

Reinvestment of common distributions

          518,876  

Cost of shares redeemed

          (621

Net proceeds from the issuance of shares due to reorganization

          151,276,550  
 

 

 

   

 

 

 

Net increase in net assets derived from capital share transactions

          151,794,805  
 

 

 

   

 

 

 

NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS(b)

   

Total increase (decrease) in net assets applicable to Common Shareholders

    (4,130,119     147,893,470  

Beginning of period

    376,177,923       228,284,453  
 

 

 

   

 

 

 

End of period

  $ 372,047,804     $ 376,177,923  
 

 

 

   

 

 

 

 

(a) 

Distributions for annual periods determined in accordance with U.S. federal income tax regulations.

(b) 

Prior year distribution character information and undistributed net investment income has been modified or removed to conform with current year Regulation S-X presentation changes. Refer to Note 11 for this prior year information.

See notes to financial statements.

 

 

FINANCIAL STATEMENTS      45  


Statements of Cash Flows  (unaudited) 

Six Months Ended January 31, 2019

 

     MNE     MZA     MYC     MYF     MYJ  

CASH PROVIDED BY (USED FOR) OPERATING ACTIVITIES

         

Net increase in net assets resulting from operations

  $ 908,372     $ 795,000     $ 1,663,721     $ 877,031     $ 4,639,273  

Adjustments to reconcile net increase in net assets resulting from operations to net cash provided by (used for) operating activities:

         

Proceeds from sales of long-term investments and principal paydowns

    9,360,861       13,083,853       102,132,893       48,338,539       71,730,691  

Purchases of long-term investments

    (10,610,279     (14,281,215     (110,355,064     (41,089,809     (55,354,693

Net proceeds from sales (purchases) of short-term securities

    703,696       (850,765     5,452,968       1,946,446       (8,332,183

Amortization of premium and accretion of discount on investments and other fees

    454,472       254,389       2,359,913       511,644       867,171  

Net realized gain (loss) on investments

    28,461       (23,869     721,908       (524,937     130,745  

Net unrealized (appreciation) depreciation on investments

    (46,777     388,902       2,968,434       4,364,277       3,099,824  

(Increase) Decrease in Assets:

         

Receivables:

         

Interest — unaffiliated

    (69,432     98,504       (472,669     136,670       (18,670

Dividends — affiliated

    467       (317     1,275       (592     (7,376

Prepaid expenses

    11,778       8,103       13,129       12,448       11,949  

Increase (Decrease) in Liabilities:

         

Payables:

         

Investment advisory fees

    31       400       (248     (5,656     (5,657

Interest expense and fees

    15,250       3,313       171,233       46,911       44,405  

Directors’ and Officer’s

    (125     (117     1,008       437       1,657  

Reorganization fees

                            (167,252

Variation margin on futures contracts

    20,410       22,134       151,691       72,122       174,868  

Other accrued expenses

    (28,182     (23,792     (52,883     (39,290     (123,239
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net cash provided by (used for) operating activities

    749,003       (525,477     4,757,309       14,646,241       16,691,513  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES

         

Payments for deferred offering costs

                            (164,296

Proceeds from TOB Trust Certificates

    1,330,000       2,000,000       7,292,735       5,759,054        

Repayments of TOB Trust Certificates

    (750,000           (1,800,409     (14,632,752     (7,150,000

Proceeds from Loan for TOB Trust Certificates

                1,800,409              

Repayments of Loan for TOB Trust Certificates

                (1,800,409            

Cash dividends paid to Common Shareholders

    (1,270,822     (1,403,810     (9,925,986     (5,542,961     (8,769,392

Decrease in bank overdraft

    (44,218     (53,977     (113,091     (101,240     (274,148

Amortization of deferred offering costs

    3,037       3,264       4,442       3,658       11,323  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net cash (provided by) used for financing activities

    (732,003     545,477       (4,542,309     (14,514,241     (16,346,513
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

CASH AND FOREIGN CURRENCY

         

Net increase in restricted and unrestricted cash and foreign currency

    17,000       20,000       215,000       132,000       345,000  

Restricted and unrestricted cash and foreign currency at beginning of period

    44,450       51,000       236,500       70,550       137,150  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Restricted and unrestricted cash and foreign currency at end of period

  $ 61,450     $ 71,000     $ 451,500     $ 202,550     $ 482,150  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

         

Cash paid during the period for interest expense

  $ 490,862     $ 491,883     $ 2,404,831     $ 1,531,249     $ 3,087,484  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

NON-CASH FINANCING ACTIVITIES

         

Capital shares issued in reinvestment of distributions paid to Common Shareholders

  $     $ 19,555     $     $ 67,480     $  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

RECONCILIATION OF RESTRICTED AND UNRESTRICTED CASH AT THE END OF PERIOD TO THE STATEMENTS OF ASSETS AND LIABILITIES

         

Cash pledged:

         

Futures contracts

  $ 61,450     $ 71,000     $ 451,500     $ 202,550     $ 482,150  

RECONCILIATION OF RESTRICTED AND UNRESTRICTED CASH AT THE BEGINNING OF PERIOD TO THE STATEMENTS OF ASSETS AND LIABILITIES

         

Cash pledged:

         

Futures contracts

  $ 44,450     $ 51,000     $ 236,500     $ 70,550     $ 137,150  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

See notes to financial statements.

 

 

46    2019 BLACKROCK SEMI-ANNUAL REPORT TO SHAREHOLDERS


Financial Highlights

(For a share outstanding throughout each period)

 

    MNE  
    Six Months Ended
01/31/19
(unaudited)
          Year Ended July 31,  
          2018      2017      2016      2015      2014  
               

Net asset value, beginning of period

  $ 14.98       $ 15.47      $ 16.32      $ 15.37      $ 15.34      $ 14.54  
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income(a)

    0.24         0.52        0.57        0.64        0.68        0.69  

Net realized and unrealized gain (loss)

    (0.02       (0.50      (0.77      0.97        0.04        0.84  
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net increase (decrease) from investment operations

    0.22         0.02        (0.20      1.61        0.72        1.53  
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Distributions to Common Shareholders(b)

                 

From net investment income

    (0.24       (0.51      (0.60      (0.66      (0.69      (0.73

From net realized gain

    (0.06              (0.05                     
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total distributions to Common Shareholders

    (0.30       (0.51      (0.65      (0.66      (0.69      (0.73
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net asset value, end of period

  $ 14.90       $ 14.98      $ 15.47      $ 16.32      $ 15.37      $ 15.34  
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Market price, end of period

  $ 12.83       $ 12.57      $ 14.07      $ 15.75      $ 14.07      $ 13.64  
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total Return Applicable to Common Shareholders(c)

                 

Based on net asset value

    1.87 %(d)        0.68      (0.75 )%       10.97      5.23      11.40
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Based on market price

    4.53 %(d)        (7.16 )%       (6.47 )%       16.99      8.34      10.27
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Ratios to Average Net Assets Applicable to Common Shareholders

                 

Total expenses

    2.83 %(e)        2.41      2.08      1.75      1.74      1.80
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total expenses after fees waived and/or reimbursed and paid indirectly

    2.83 %(e)        2.41      2.08      1.75      1.74      1.80
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total expenses after fees waived and/or reimbursed and/or paid indirectly and excluding interest expense, fees, and amortization of offering costs(f)(g)

    1.21 %(e)        1.16      1.13      1.26      1.59      1.63
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income to Common Shareholders

    3.28 %(e)        3.44      3.70      4.03      4.38      4.66
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Supplemental Data

                 

Net assets applicable to Common Shareholders, end of period (000)

  $ 62,719       $ 63,081      $ 65,126      $ 68,712      $ 64,717      $ 64,566  
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

VRDP Shares outstanding at $100,000 liquidation value, end of period (000)

  $ 29,600       $ 29,600      $ 29,600      $ 29,600      $ 29,600      $ 29,600  
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Asset coverage per VRDP Shares at $100,000 liquidation value, end of period

  $ 311,888       $ 313,113      $ 320,020      $ 332,135      $ 318,638      $ 318,130  
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Borrowings outstanding, end of period (000)

  $ 13,360       $ 12,780      $ 8,859      $ 8,939      $ 6,419      $ 5,759  
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Portfolio turnover rate

    9       23      14      21      15      21
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

(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) 

Aggregate total return.

(e) 

Annualized.

(f)

Interest expense, fees and amortization of offering costs related to TOBs and/or VRDP Shares. See Note 4 and Note 10 of the Notes to Financial Statements for details.

(g)

The total expense ratio after fees waived and paid indirectly and excluding interest expense, fees, amortization of offering costs, liquidity and remarketing fees as follows:

 

    Six Months Ended
01/31/19
(unaudited)
          Year Ended July 31,  
            2018            2017            2016            2015            2014         

Expense ratios

            1.21             1.16             1.13             1.16             1.14             1.14        
 

 

 

     

 

 

     

 

 

     

 

 

     

 

 

     

 

 

   

See notes to financial statements.

 

 

FINANCIAL HIGHLIGHTS      47  


Financial Highlights  (continued)

(For a share outstanding throughout each period)

 

    MZA  
    Six Months Ended
01/31/19
(unaudited)
          Year Ended July 31,  
          2018      2017      2016      2015      2014  
               

Net asset value, beginning of period

  $ 14.06       $ 14.56      $ 15.42      $ 14.72      $ 14.52      $ 13.57  
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income(a)

    0.28         0.66        0.72        0.77        0.80        0.81  

Net realized and unrealized gain (loss)

    (0.11       (0.47      (0.84      0.75        0.23        0.97  
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net increase (decrease) from investment operations

    0.17         0.19        (0.12      1.52        1.03        1.78  
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Distributions to Common Shareholders from net investment income(b)

    (0.30       (0.69      (0.74      (0.82      (0.83      (0.83
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net asset value, end of period

  $ 13.93       $ 14.06      $ 14.56      $ 15.42      $ 14.72      $ 14.52  
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Market price, end of period

  $ 12.93       $ 14.45      $ 16.59      $ 17.68      $ 16.90      $ 15.00  
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total Return Applicable to Common Shareholders(c)

                 

Based on net asset value

    1.42 %(d)        1.22      (0.72 )%       10.11      6.97      13.63
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Based on market price

    (8.40 )%(d)        (8.71 )%       (1.34 )%       9.96      18.88      19.50
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Ratios to Average Net Assets Applicable to Common Shareholders

                 

Total expenses

    2.62 %(e)        2.28      2.00      1.64      1.63      1.69
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total expenses after fees waived and/or reimbursed and paid indirectly

    2.62 %(e)        2.28      2.00      1.64      1.63      1.69
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total expenses after fees waived and/or reimbursed and/or paid indirectly and excluding interest expense, fees, and amortization of offering costs(f)

    1.08 %(e)        1.05      1.03      1.02      1.05      1.06
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income to Common Shareholders

    4.04 %(e)        4.62      4.94      5.15      5.41      5.85
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Supplemental Data

                 

Net assets applicable to Common Shareholders, end of period (000)

  $ 64,567       $ 65,153      $ 67,346      $ 71,133      $ 67,708      $ 66,613  
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

VRDP Shares outstanding at $100,000 liquidation value, end of period (000)

  $ 37,300       $ 37,300      $ 37,300      $ 37,300      $ 37,300      $ 37,300  
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Asset coverage per VRDP Shares at $100,000 liquidation value, end of period

  $ 273,103       $ 274,673      $ 280,553      $ 290,705      $ 281,522      $ 278,586  
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Borrowings outstanding, end of period (000)

  $ 5,000       $ 3,000      $ 3,000      $ 3,000      $ 3,330      $ 3,330  
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Portfolio turnover rate

    12       20      9      13      16      13
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

(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) 

Aggregate total return.

(e) 

Annualized.

(f) 

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.

 

 

48    2019 BLACKROCK SEMI-ANNUAL REPORT TO SHAREHOLDERS


Financial Highlights  (continued)

(For a share outstanding throughout each period)

 

    MYC  
    Six Months Ended
01/31/19
(unaudited)
          Year Ended July 31,  
          2018      2017      2016      2015      2014  
               

Net asset value, beginning of period

  $ 15.11       $ 15.61      $ 17.07      $ 16.35      $ 16.38      $ 14.96  
 

 

 

   

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income(a)

    0.29         0.66        0.74        0.86        0.87        0.91  

Net realized and unrealized gain (loss)

    (0.21       (0.41      (1.10      0.87               1.46  
 

 

 

   

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net increase (decrease) from investment operations

    0.08         0.25        (0.36      1.73        0.87        2.37  
 

 

 

   

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Distributions to Common Shareholders(b)

                 

From net investment income

    (0.31       (0.69      (0.80      (0.88      (0.90      (0.95

From net realized gain

    (0.15       (0.06      (0.30      (0.13              
 

 

 

   

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total distributions to Common Shareholders

    (0.46       (0.75      (1.10      (1.01      (0.90      (0.95
 

 

 

   

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net asset value, end of period

  $ 14.73       $ 15.11      $ 15.61      $ 17.07      $ 16.35      $ 16.38  
 

 

 

   

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Market price, end of period

  $ 13.16       $ 13.19      $ 15.43      $ 17.43      $ 15.47      $ 14.87  
 

 

 

   

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total Return Applicable to Common Shareholders(c)

                 

Based on net asset value

    0.98 %(d)        2.02      (1.83 )%       11.07      5.75      16.87
 

 

 

   

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Based on market price

    3.36 %(d)        (9.91 )%       (4.96 )%       19.86      10.21      13.86
 

 

 

   

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Ratios to Average Net Assets Applicable to Common Shareholders

                 

Total expenses

    2.57 %(e)        2.26      2.08      1.55      1.37      1.43
 

 

 

   

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total expenses after fees waived and paid indirectly

    2.57 %(e)        2.26      2.08      1.55      1.37      1.42
 

 

 

   

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total expenses after fees waived and/or reimbursed and/or paid indirectly and excluding interest expense, fees, and amortization of offering costs(f)

    0.95 %(e)        0.94      0.96      0.92      0.89      0.92
 

 

 

   

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income to Common Shareholders

    3.91 %(e)        4.32      4.68      5.15      5.29      5.88
 

 

 

   

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Supplemental Data

                 

Net assets applicable to Common Shareholders, end of period (000)

  $ 315,483       $ 323,745      $ 334,456      $ 364,594      $ 348,849      $ 349,484  
 

 

 

   

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

VRDP Shares outstanding at $100,000 liquidation value, end of period (000)

  $ 105,900       $ 105,900      $ 105,900      $ 105,900      $ 105,900      $ 105,900  
 

 

 

   

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Asset coverage per VRDP Shares at $100,000 liquidation value, end of period

  $ 397,906       $ 405,708      $ 415,823      $ 444,282      $ 429,413      $ 430,013  
 

 

 

   

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Borrowings outstanding, end of period (000)

  $ 119,600       $ 114,108      $ 122,501      $ 141,734      $ 119,196      $ 83,283  
 

 

 

   

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Portfolio turnover rate

    19       37      34      27      32      23
 

 

 

   

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

(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) 

Aggregate total return.

(e) 

Annualized.

(f)

Interest expense, fees and amortization of offering costs related to TOBs 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      49  


Financial Highlights  (continued)

(For a share outstanding throughout each period)

 

    MYF  
    Six Months Ended
01/31/19
(unaudited)
          Year Ended July 31,  
          2018      2017      2016      2015      2014  
               

Net asset value, beginning of period

  $ 14.29       $ 14.94      $ 16.03      $ 15.61      $ 15.56      $ 14.26  
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income(a)

    0.38         0.83        0.87        0.92        0.95        0.96  

Net realized and unrealized gain (loss)

    (0.32       (0.61      (1.02      0.47        0.07        1.29  
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net increase (decrease) from investment operations

    0.06         0.22        (0.15      1.39        1.02        2.25  
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Distributions to Common Shareholders from net investment income(b)

    (0.40       (0.87      (0.94      (0.97      (0.97      (0.95
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net asset value, end of period

  $ 13.95       $ 14.29      $ 14.94      $ 16.03      $ 15.61      $ 15.56  
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Market price, end of period

  $ 13.52       $ 13.69      $ 16.34      $ 17.02      $ 14.67      $ 14.56  
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total Return Applicable to Common Shareholders(c)

                 

Based on net asset value

    0.53 %(d)        1.61      (0.88 )%       9.24      6.88      16.75
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Based on market price

    1.70 %(d)        (11.00 )%       2.10      23.41      7.34      14.98
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Ratios to Average Net Assets Applicable to Common Shareholders

                 

Total expenses

    2.63 %(e)        2.33      1.97      1.53      1.46      1.52
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total expenses after fees waived and/or reimbursed and paid indirectly

    2.63 %(e)        2.32      1.97      1.53      1.46      1.52
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total expenses after fees waived and/or reimbursed and/or paid indirectly and excluding interest expense, fees and amortization of offering costs(f)

    0.99 %(e)        0.98      0.97      0.94      0.94      0.97
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income to Common Shareholders

    5.33 %(e)        5.72      5.76      5.86      6.00      6.56
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Supplemental Data

                 

Net assets applicable to Common Shareholders, end of period (000)

  $ 191,214       $ 195,777      $ 204,427      $ 218,740      $ 212,691      $ 211,966  
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

VRDP Shares outstanding at $100,000 liquidation value, end of period (000)

  $ 59,400       $ 59,400      $ 59,400      $ 59,400      $ 59,400      $ 59,400  
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Asset coverage per VRDP Shares at $100,000 liquidation value, end of period

  $ 421,909       $ 429,591      $ 444,154      $ 468,250      $ 458,065      $ 456,845  
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Borrowings outstanding, end of period (000)

  $ 73,078       $ 81,012      $ 79,110      $ 77,759      $ 75,764      $ 75,865  
 

 

 

     

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Portfolio turnover rate

    13       15      12      11      13      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)

Aggregate total return.

(e)

Annualized.

(f)

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.

 

 

50    2019 BLACKROCK SEMI-ANNUAL REPORT TO SHAREHOLDERS


Financial Highlights  (continued)

(For a share outstanding throughout each period)

 

    MYJ  
    Six Months Ended
01/31/19
(unaudited)
          Year Ended July 31,  
          2018     2017      2016      2015      2014  
               

Net asset value, beginning of period

  $ 15.57       $ 15.89     $ 16.93      $ 16.01      $ 16.11      $ 14.92  
 

 

 

     

 

 

   

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income(a)

    0.37         0.77       0.81        0.89        0.90        0.90  

Net realized and unrealized gain (loss)

    (0.18       (0.21     (0.95      0.94        (0.10      1.21  
 

 

 

     

 

 

   

 

 

    

 

 

    

 

 

    

 

 

 

Net increase (decrease) from investment operations

    0.19         0.56       (0.14      1.83        0.80        2.11  
 

 

 

     

 

 

   

 

 

    

 

 

    

 

 

    

 

 

 

Distributions to Common Shareholders(b)

                

From net investment income

    (0.36       (0.88     (0.90      (0.91      (0.90      (0.89

From net realized gain

                                       (0.03
 

 

 

     

 

 

   

 

 

    

 

 

    

 

 

    

 

 

 

Total distributions to Common Shareholders

    (0.36       (0.88     (0.90      (0.91      (0.90      (0.92
 

 

 

     

 

 

   

 

 

    

 

 

    

 

 

    

 

 

 

Net asset value, end of period

  $ 15.40       $ 15.57     $ 15.89      $ 16.93      $ 16.01      $ 16.11  
 

 

 

     

 

 

   

 

 

    

 

 

    

 

 

    

 

 

 

Market price, end of period

  $ 13.60       $ 13.51     $ 16.58      $ 17.49      $ 14.72      $ 14.67  
 

 

 

     

 

 

   

 

 

    

 

 

    

 

 

    

 

 

 

Total Return Applicable to Common Shareholders(c)

                

Based on net asset value

    1.65 %(d)        3.94     (0.68 )%       11.95      5.52      15.27
 

 

 

     

 

 

   

 

 

    

 

 

    

 

 

    

 

 

 

Based on market price

    3.46 %(d)        (13.57 )%      0.32      25.78      6.54      13.99
 

 

 

     

 

 

   

 

 

    

 

 

    

 

 

    

 

 

 

Ratios to Average Net Assets Applicable to Common Shareholders

                

Total expenses

    2.53 %(e)        2.38 %(g)      1.93      1.55      1.50      1.57
 

 

 

     

 

 

   

 

 

    

 

 

    

 

 

    

 

 

 

Total expenses after fees waived and/or reimbursed and paid indirectly

    2.51 %(e)        2.25 %(g)      1.93      1.55      1.50      1.57
 

 

 

     

 

 

   

 

 

    

 

 

    

 

 

    

 

 

 

Total expenses after fees waived and/or reimbursed and/or paid indirectly and excluding interest expense, fees, and amortization of offering costs(f)

    0.91 %(e)        0.94 %(g)      0.93      0.92      0.93      0.95
 

 

 

     

 

 

   

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income to Common Shareholders

    4.74 %(e)        4.93     5.11      5.43      5.51      5.89
 

 

 

     

 

 

   

 

 

    

 

 

    

 

 

    

 

 

 

Supplemental Data

                

Net assets applicable to Common Shareholders, end of period (000)

  $ 372,048       $ 376,178     $ 228,284      $ 242,134      $ 228,628      $ 230,112  
 

 

 

     

 

 

   

 

 

    

 

 

    

 

 

    

 

 

 

VRDP Shares outstanding at $100,000 liquidation value, end of period (000)

  $ 180,000       $ 180,000     $ 102,200      $ 102,200      $ 102,200      $ 102,200  
 

 

 

     

 

 

   

 

 

    

 

 

    

 

 

    

 

 

 

Asset coverage per VRDP Shares at $100,000 liquidation value, end of period

  $ 306,693       $ 308,988     $ 323,370      $ 336,922      $ 323,707      $ 325,159  
 

 

 

     

 

 

   

 

 

    

 

 

    

 

 

    

 

 

 

Borrowings outstanding, end of period (000)

  $ 63,138       $ 70,288     $ 45,634      $ 40,642      $ 39,554      $ 39,554  
 

 

 

     

 

 

   

 

 

    

 

 

    

 

 

    

 

 

 

Portfolio turnover rate

    9       11     6      10      11      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)

Aggregate total return.

(e)

Annualized.

(f)

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.

(g)

Includes reorganization costs associated with the Fund’s reorganization. Without these costs, total expenses, total expenses after fees waived and/or reimbursed and paid indirectly and total expenses after fees waived and/or reimbursed and paid indirectly and excluding interest expense, fees, and amortization of offering costs, would have been 2.26%, 2.25% and 0.94%, respectively, for the year ended July 31, 2018.

 

 

FINANCIAL HIGHLIGHTS      51  


Notes to Financial Statements  (unaudited)

 

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 Muni New York Intermediate Duration Fund, Inc.

  MNE    Maryland    Non-diversified

BlackRock MuniYield Arizona Fund, Inc.

  MZA    Maryland    Diversified

BlackRock MuniYield California Fund, Inc.

  MYC    Maryland    Non-diversified

BlackRock MuniYield Investment Fund

  MYF    Massachusetts    Diversified

BlackRock MuniYield New Jersey Fund, Inc.

  MYJ    Maryland    Non-diversified

The Boards of Directors or Trustees of the Funds are collectively referred to throughout this report as the “Board of Directors” or the “Board,” and the directors or trustees 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 non-index fixed-income mutual funds and all BlackRock-advised closed-end funds referred to as the Fixed-Income 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. 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 monthly 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 funds in the BlackRock Fixed-Income Complex 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 funds in the BlackRock Fixed-Income Complex.

The Plan is not funded and obligations thereunder represent general unsecured claims against the general assets of each Fund, as 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 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.

In August 2018, the Financial Accounting Standards Board issued Accounting Standards Update 2018-13 “Changes to the Disclosure Requirements for Fair Value Measurement” which modifies disclosure requirements for fair value measurements. The guidance is effective for fiscal years beginning after December 15, 2019 and for interim periods within those fiscal years. Management is currently evaluating the impact of this guidance to the Funds.

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.

 

 

52    2019 BLACKROCK SEMI-ANNUAL REPORT TO SHAREHOLDERS


Notes to Financial Statements  (unaudited) (continued)

 

 

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 each Fund. 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 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.

 

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.

 

 

NOTES TO FINANCIAL STATEMENTS      53  


Notes to Financial Statements  (unaudited) (continued)

 

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. With respect to MZA, MYC, MYF and MYJ, the Funds’ management believed that the Funds’ 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  

MNE

  $ 102,640      $ 31,732      $ 7,376      $ 141,748  

MZA

    29,410        8,829        2,806        41,045  

MYC

    933,126        271,164        82,362        1,286,652  

MYF

    624,266        172,917        57,737        854,920  

MYJ

    550,285        125,219        99,943        775,447  

For the six months ended January 31, 2019, 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
 

MNE

  $ 23,257,063      $ 13,360,377        1.30% — 1.45    $ 12,907,768        2.18

MZA

    10,721,530        5,000,000        1.32 — 1.35        3,804,348        2.14  

MYC

    263,332,734        119,600,027        1.25 — 1.44        118,162,666        2.16  

MYF

    127,178,097        73,078,479        1.25 — 1.49        78,091,884        2.17  

MYJ

    109,815,560        63,137,619        1.29 — 1.49        68,006,098        2.26  

 

  (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 funds, for such reimbursements, as applicable, are included in the maximum potential amounts disclosed for recourse TOB Trusts.

 

 

 

54    2019 BLACKROCK SEMI-ANNUAL REPORT TO SHAREHOLDERS


Notes to Financial Statements  (unaudited) (continued)

 

  (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 to allow the TOB Trust to repurchase TOB Trust Certificates. The Liquidity Provider will be reimbursed from the liquidation of bonds held in the TOB Trust. If a fund invests in a TOB Trust on a recourse basis, a fund enters into a reimbursement agreement with the Liquidity Provider where a fund is required to reimburse the Liquidity Provider for any shortfall between the amount paid by the Liquidity Provider and proceeds received from liquidation of municipal bonds held in the TOB Trust (the “Liquidation Shortfall”). As a result, if a fund invests in a recourse TOB Trust, the 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 January 31, 2019 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 January 31, 2019.

 

For the six months ended January 31, 2019, the following table is a summary of each fund’s Loan for TOB Trust Certificates:

 

     Loan
Outstanding
at Period End
     Interest Rate
on Loan at
Period End
     Average
Loans
Outstanding
     Daily Weighted
Average Rate
of Interest and
Other Expenses
on Loans
 

MYC

  $           $ 153,220        0.94

 

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) and 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. Amounts pledged, which are considered restricted, are included in cash pledged for futures contracts in the Statements of Assets and Liabilities.

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.

 

6.

INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES

Investment Advisory: Each Fund entered into an Investment Advisory Agreement with the Manager, the Funds’ investment adviser and an indirect, wholly-owned subsidiary of BlackRock, (“BlackRock”), to provide investment advisory and administrative 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 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.

 

     MNE      MZA      MYC      MYF      MYJ  

Investment advisory fee

    0.55      0.50      0.50      0.50      0.50

For purposes of calculating these fees, “net assets” mean the total assets of each 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: With respect to MYJ, effective on June 11, 2018 with the reorganizations of BLJ and BNJ with and into MYJ, the Manager voluntarily agreed to waive 0.01% of its investment advisory fee. This amount is included in fees waived and/or reimbursed by the Manager in the Statements of Operations. For the six months ended January 31, 2019, the amount waived was $31,179.

With respect to each Fund, 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 and/or reimbursed by the Manager in the Statements of Operations. For the six months ended January 31, 2019, the amounts waived were as follows:

 

     MNE      MZA      MYC      MYF      MYJ  

Amounts waived

  $ 133      $ 338      $ 447      $ 461      $ 1,995  

 

 

NOTES TO FINANCIAL STATEMENTS      55  


Notes to Financial Statements  (unaudited) (continued)

 

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 Fund’s Independent Directors. For the six months ended January 31, 2019, there were no fees waived by the Manager, pursuant to this arrangement.

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.

 

7.

PURCHASES AND SALES

For the six months ended January 31, 2019, purchases and sales of investments, excluding short-term securities, were as follows:

 

     MNE      MZA      MYC      MYF      MYJ  

Purchases

  $ 10,258,040      $ 14,860,845      $ 102,562,070      $ 43,462,567      $ 52,285,513  

Sales

    9,360,861        13,083,853        102,132,893        48,342,302        71,730,691  

 

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 July 31, 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.

Management has analyzed tax laws and regulations and their application to the Funds as of January 31, 2019, 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.

As of July 31, 2018, the Funds had capital loss carryforwards available to offset future realized capital gains through the indicated expiration dates as follows:

 

Expires July 31,   MZA      MYF      MYJ  

No expiration date(a)

  $      $ 4,035,486      $ 1,172,213  

2019

    68,649                
 

 

 

    

 

 

    

 

 

 
  $ 68,649      $ 4,035,486      $ 1,172,213  
 

 

 

    

 

 

    

 

 

 

 

  (a) 

Must be utilized prior to losses subject to expiration.

 

As of January 31, 2019, gross unrealized appreciation and depreciation for investments and derivatives based on cost for U.S. federal income tax purposes were as follows:

 

     MNE     MZA     MYC     MYF     MYJ  

Tax cost

  $  88,023,463     $  98,261,523     $ 749,384     $  237,253,900     $  522,762,047  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Gross unrealized appreciation

  $ 3,561,331     $ 3,860,047     $ 15,096,620     $ 12,193,305     $ 29,649,306  

Gross unrealized depreciation

    (411,968     (386,095     (3,493,778     (1,237,750     (5,269,617
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net unrealized appreciation

  $ 3,149,363     $ 3,473,952     $ 11,602,842     $ 10,955,555     $ 24,379,689  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

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

 

 

56    2019 BLACKROCK SEMI-ANNUAL REPORT TO SHAREHOLDERS


Notes to Financial Statements  (unaudited) (continued)

 

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 Common Shareholders. Also, fluctuations in the market value of municipal bonds deposited into the TOB Trust may adversely affect the Funds’ NAVs per share.

The U.S. Securities and Exchange Commission (“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 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: Each Fund invests a substantial amount of its assets in issuers located in a single state or limited number of states, except for MYF. This may subject each Fund to the risk that economic, political or social issues impacting a particular state or group of states could have an adverse and disproportionate impact on the income from, or the value or liquidity of, the Funds’ respective portfolios. Investment percentages in specific states or U.S. territories are presented in the Schedules of Investments.

As of period end, MNE invested a significant portion of its assets in securities in the education sector. MZA invested a significant portion of its assets in securities in the utilities sector. MYC invested a significant portion of its assets in securities in the county, city, special district and school district sector. MYF and MYJ 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.

Certain 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. The Funds may be subject to a greater risk of rising interest rates due to the current period of historically low rates. The Federal Reserve has begun to raise the Federal Funds rate, and each increase results in more pronounced interest rate risk in the current market environment.

 

10.

CAPITAL SHARE TRANSACTIONS

Each Fund is authorized to issue 200 million shares (an unlimited number of shares for MYF), 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, except for MYF, which is $0.05. The Board is authorized, however, to reclassify any unissued Common Shares to Preferred Shares without the approval of Common Shareholders. MYF is authorized to issue 1 million Preferred Shares.

 

 

NOTES TO FINANCIAL STATEMENTS      57  


Notes to Financial Statements  (unaudited) (continued)

 

Common Shares

For the six months shown, shares issued and outstanding increased by the following amounts as a result of dividend reinvestment:

 

     MZA      MYF      MYJ  

Six months ended January 31, 2019

    1,393        4,783         

Year ended July 31, 2018

    10,464        15,524        32,673  

For the six months ended January 31, 2019 and year ended July 31, 2018, shares issued and outstanding remained constant for MNE and MYC.

On November 15, 2018, the Board authorized each Fund to participate in an open market share repurchase program. Under the program, each Fund may repurchase up to 5% of its outstanding common shares through November 30, 2019, based on common shares outstanding as of the close of business on November 30, 2018, subject to certain conditions. There is no assurance that the Funds will purchase shares in any particular amounts. For the six months ended January 31, 2019, the Funds did not repurchase any shares.

Preferred Shares

Each Fund’s Preferred Shares rank prior to its Common Shares as to the payment of dividends by the Fund and distribution of assets upon dissolution or liquidation of the Fund. The 1940 Act prohibits the declaration of any dividend on Common Shares or the repurchase of Common Shares if the Fund fails to maintain asset coverage of at least 200% of the liquidation preference of the its 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 its Preferred Shares or repurchasing such shares if the 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.

Holders of Preferred Shares have voting rights equal to the voting rights of holders of Common Shares (one vote per share) and vote together with holders of Common Shares (one vote per share) as a single class on certain matters. Holders of Preferred Shares, voting as a separate class, are also entitled to (i) elect two members of the Board, (ii) elect the full Board if dividends on the Preferred Shares are not paid for a period of two years and (iii) 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

MNE, MZA, MYC, MYF and MYJ (collectively, the “VRDP Funds”), have issued Series W-7 VRDP Shares, $100,000 liquidation preference per share, in one or more privately negotiated offerings 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 may be subject to a special rate period. As of period end, the VRDP Shares outstanding were as follows:

 

    

Issue

Date

     Shares
Issued
     Aggregate
Principal
     Maturity
Date
 

MNE

    09/15/11        296      $ 29,600,000        10/01/41  

MZA

    05/19/11        373        37,300,000        06/01/41  

MYC

    05/19/11        1,059        105,900,000        06/01/41  

MYF

    05/19/11        594        59,400,000        06/01/41  

MYJ

    04/21/11        1,022        102,200,000        05/01/41  

MYJ

    06/11/18        778        77,800,000        05/01/41  

Redemption Terms: A VRDP Fund is required to redeem its VRDP Shares on the maturity date, unless earlier redeemed or repurchased. Six months prior to the maturity date, a VRDP Fund is required to begin to segregate liquid assets with the Fund’s custodian to fund the redemption. In addition, a VRDP Fund 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 a VRDP Fund. The redemption price per VRDP Share is equal to the liquidation preference per share plus any outstanding unpaid dividends.

Liquidity Feature: VRDP Shares are subject to a fee agreement between the VRDP Fund and the liquidity provider that requires a per annum liquidity fee and, in some cases, an upfront or initial commitment fee, payable to the liquidity provider. These fees, if applicable, are shown as liquidity fees in the Statements of Operations. The fee agreement is set to expire, unless renewed or terminated in advance, as follows:

 

     MNE      MZA      MYC      MYF      MYJ  

Expiration Date

    10/21/19        07/04/19        07/04/19        07/04/19        07/04/19  

In the event a fee agreement is not renewed or is terminated in advance, and the VRDP Fund 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, a VRDP Fund is required to redeem the VRDP Shares six months after the purchase date. Immediately after such mandatory purchase, the VRDP Fund is required to begin to segregate liquid assets with its custodian to fund the redemption. There is no assurance that a VRDP Fund will replace such redeemed VRDP Shares with any other preferred shares or other form of leverage.

 

 

58    2019 BLACKROCK SEMI-ANNUAL REPORT TO SHAREHOLDERS


Notes to Financial Statements  (unaudited) (continued)

 

Remarketing: A VRDP Fund may incur remarketing fees on the aggregate principal amount of all its 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), a VRDP Fund may incur nominal or no remarketing fees.

Dividends: Except during the Special Rate Period, 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. A change in the short-term credit rating of the liquidity provider or the VRDP Shares may adversely affect the dividend rate paid on such shares, although the dividend rate paid on the VRDP Shares is not directly based upon either short-term rating. 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.

For the six months ended January 31, 2019, the annualized dividend rates for the VRDP Shares were as follows:

 

     MNE      MZA      MYC      MYF      MYJ  

Rate

    1.23      1.22      1.22      1.22      1.94

Ratings: As of period end, the VRDP Shares were assigned the following long-term ratings:

 

     Moody’s    Fitch

MNE

  Aa2    AAA

MZA

  Aa2    AAA

MYC

  Aa2    AAA

MYF

  Aa1    AAA

MYJ

  Aa2    AAA

Any short-term ratings on VRDP Shares are directly related to the short-term ratings of the liquidity provider for such VRDP Shares. Changes in the credit quality of the liquidity provider could cause a change in the short-term credit ratings of the VRDP Shares as rated by Moody’s and Fitch. The liquidity provider may be terminated prior to the scheduled termination date if the liquidity provider fails to maintain short-term debt ratings in one of the two highest rating categories.

Special Rate Period: A VRDP Fund may commence a “special rate period” with respect to its VRDP Shares, during which the VRDP Shares will not be subject to any remarketing and the dividend rate will be based on a predetermined methodology. During a special rate period, short-term ratings on VRDP Shares are withdrawn. The following VRDP Funds have commenced or are set to commence a special rate period:

 

    

Commencement

Date*

    

Expiration Date

as of Period Ended

January 31, 2019

 

MNE

    10/22/2015        04/17/2019  

MZA

    06/21/2012        06/19/2019  

MYC

    06/21/2012        06/19/2019  

MYF

    06/21/2012        06/19/2019  

MYJ

    06/21/2012        06/19/2019  

 

  *

Issuance date of VRDP Shares.

 

Prior to the expiration date, the VRDP Fund and the VRDP Shares holder may mutually agree to extend the special rate period. If a 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: (i) the liquidity and fee agreements remain in effect, (ii) VRDP Shares remain subject to mandatory redemption by the VRDP Fund on the maturity date, (iii) VRDP Shares will not be remarketed or subject to optional or mandatory tender events, (iv) the VRDP Fund 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, (v) the VRDP Fund will 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 and (vi) the VRDP Fund will pay nominal or no fees to the liquidity provider and remarketing agent.

If a VRDP Fund redeems its 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.

Offering Costs: The Funds incurred costs in connection with the issuance of VRDP 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 Shares with the exception of any upfront fees paid by a VRDP Fund 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.

Financial Reporting: The VRDP Shares are considered debt of the issuer; therefore, the liquidation preference, which approximates fair value of the VRDP 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 Shares are included as a component of interest expense, fees and amortization of offering costs in the Statements of Operations. The VRDP Shares are treated as equity for tax purposes. Dividends paid to holders of the VRDP Shares are generally

 

 

NOTES TO FINANCIAL STATEMENTS      59  


Notes to Financial Statements  (unaudited) (continued)

 

classified as tax-exempt income for tax-reporting purposes. Dividends and amortization of deferred offering costs on VRDP Shares are included in interest expense, fees and amortization of offering costs in the Statements of Operations:

 

    

Dividends

Accrued

    

Deferred

Offering Costs

Amortization

 

MNE

  $ 364,364      $ 3,037  

MZA

    454,151        3,264  

MYC

    1,289,412        4,442  

MYF

    723,240        3,658  

MYJ

    2,192,146        11,323  

 

11.

REGULATION S-X AMENDMENTS

On August 17, 2018, the SEC adopted amendments to certain disclosure requirements in Securities Act Release No. 33-10532, Disclosure Update and Simplification. The Funds have adopted the amendments pertinent to Regulation S-X in this shareholder report. The amendments impacted certain disclosure presentation on the Statements of Assets and Liabilities, Statements of Changes in Net Assets and Notes to the Financial Statements.

Prior year distribution information and undistributed net investment income in the Statements of Changes in Net Assets has been modified to conform to the current year presentation in accordance with the Regulation S-X changes.

Distributions for the year ended July 31, 2018 were classified as follows:

 

     Net Investment Income      Net Realized Gain  

MNE

  $ 2,153,335      $  

MZA

    3,213,774         

MYC

    14,866,035        1,273,196  

MYF

    11,897,107         

MYJ

    13,214,077         

Undistributed net investment income as of July 31, 2018 is as follows:

 

     Undistributed
Net Investment Income
 

MNE

  $ 243,033  

MZA

    185,367  

MYC

    1,206,970  

MYF

    1,583,284  

MYJ

    2,634,140  

 

12.

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  

MNE

  $ 0.0400      $ 0.0400         VRDP        W-7      $ 57,075  

MZA

    0.0470        0.0470         VRDP        W-7        71,064  

MYC

    0.0520        0.0480         VRDP        W-7        201,761  

MYF

    0.0620        0.0620         VRDP        W-7        113,169  

MYJ

    0.0605        0.0605               VRDP        W-7        342,937  

 

  (a) 

Net investment income dividend paid on March 1, 2019 to Common Shareholders of record on February 15, 2019.

 
  (b) 

Net investment income dividend declared on March 1, 2019, payable to Common Shareholders of record on March 15, 2019.

 
  (c) 

Dividends declared for period February 1, 2019 to February 28, 2019.

 

 

 

60    2019 BLACKROCK SEMI-ANNUAL REPORT TO SHAREHOLDERS


Director and Officer Information

 

Richard E. Cavanagh, Co-Chair of the Board and Director

Karen P. Robards, Co-Chair of the Board and Director

Michael J. Castellano, Director

Cynthia L. Egan, Director

Frank J. Fabozzi, Director

Henry Gabbay, Director

R. Glenn Hubbard, Director

W. Carl Kester, Director

Catherine A. Lynch, Director

Robert Fairbairn, Director

John M. Perlowski, Director, President and Chief Executive Officer

Jonathan Diorio, Vice President

Neal J. Andrews, Chief Financial Officer

Jay M. Fife, Treasurer

Charles Park, Chief Compliance Officer

Janey Ahn, Secretary

 

Effective January 1, 2019, Richard E. Cavanagh and Karen P. Robards were appointed as a Co-Chair of the Board. Prior to January 1, 2019, Mr. Cavanagh served as Chair of the Board and Ms. Robards served as Vice Chair of the Board. In addition, effective January 1, 2019, Henry Gabbay was appointed as a Director of each Fund.

 

Investment Adviser

BlackRock Advisors, LLC

Wilmington, DE 19809

Accounting Agent and Custodian

State Street Bank and Trust Company

Boston, MA 02111

Transfer Agent

Computershare Trust
 Company, N.A.

Canton, MA 02021

VRDP Tender and Paying Agent

The Bank of New York Mellon

New York, NY 10286

VRDP Remarketing Agent

Barclays Capital, Inc.(a)

New York, NY 10019

Citigroup Global Markets Inc.(b)

New York, NY 10179

VRDP Liquidity Provider

Barclays Bank PLC(a)

New York, NY 10019

Citibank, N.A.(b)

New York, NY 10179

Legal Counsel

Willkie Farr & Gallagher LLP

New York, NY 10019

Independent Registered Public Accounting Firm

Deloitte & Touche LLP

Boston, MA 02116

Address of the Funds

100 Bellevue Parkway

Wilmington, DE 19809

 

 

(a) 

For MNE.

(b) 

For all Funds except MNE.

 

 

DIRECTOR AND OFFICER INFORMATION      61  


Additional Information

 

Section 19(a) Notices

The amounts and sources of distributions reported in this notice are estimates that are subject to change based on the Fund’s investment experience during the remainder of the calendar year, are for financial reporting purposes and are not being provided for tax reporting purposes. The actual amounts and character of the distributions for tax reporting purposes will be reported to shareholders on Form 1099-DIV which is sent to shareholders shortly after calendar year end.

 

  

 

         Total Fiscal Year to Date Cumulative
Distributions by Character
    Percentage of Fiscal Year to Date Cumulative
Distributions by Character
 
Fund   Ticker     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
 

BlackRock MuniYield Investment Fund

    MYF     $ 0.402000                       $ 0.402000       100     0     0     0     100

Section 19(a) notices for the Fund, as applicable, are available on the BlackRock website at http://www.blackrock.com.

Fund Certification

The 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. There have been no changes in the persons who are primarily responsible for the day-to-day management of the Funds’ portfolios.

In accordance with Section 23(c) of the Investment Company Act of 1940, each Fund may from time to time purchase shares of its common stock in the open market or in private transactions.

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, including 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.

 

 

62    2019 BLACKROCK SEMI-ANNUAL REPORT TO SHAREHOLDERS


Additional Information  (continued)

 

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. 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.

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.

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.

 

 

ADDITIONAL INFORMATION      63  


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
ERB    Education Revenue Bonds
FHA    Federal Housing Administration
GARB    General Airport Revenue Bonds
GO    General Obligation Bonds
HFA    Housing Finance Agency
IDA    Industrial Development Authority
IDB    Industrial Development Board
LRB    Lease Revenue Bonds
M/F    Multi-Family
NPFGC    National Public Finance Guarantee Corp.
PILOT    Payment in Lieu of Taxes
RB    Revenue Bonds
S/F    Single-Family
SONYMA    State of New York Mortgage Agency
 

 

 

64    2019 BLACKROCK SEMI-ANNUAL REPORT TO SHAREHOLDERS


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

 

 

MY5-1/19-SAR    LOGO


Item 2 –   Code of Ethics – Not Applicable to this semi-annual report
Item 3 –   Audit Committee Financial Expert – Not Applicable to this semi-annual report
Item 4 –   Principal Accountant Fees and Services – Not Applicable to this semi-annual report
Item 5 –   Audit Committee of Listed Registrants – Not Applicable to this semi-annual report
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 – Not Applicable to this semi-annual report
Item 8 –   Portfolio Managers of Closed-End Management Investment Companies
  (a) Not Applicable to this semi-annual report.
 

(b)As of the date of this filing, there have been no changes in any of the portfolio managers identified in the most recent annual report on Form N-CSR.

Item 9 –   Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers

 

Period                                             

  (a) Total

Number of

Shares

Purchased

  (b) Average

Price Paid per

Share

  (c) Total Number of

Shares Purchased as Part

of Publicly Announced

Plans or Programs

  (d) Maximum Number of

Shares that May Yet Be

Purchased Under the Plans

or Programs1

August 1 – 31, 2018

  N/A   N/A   N/A   N/A

September 1 – 30, 2018

  N/A   N/A   N/A   N/A

October 1- 31, 2018

  N/A   N/A   N/A   N/A

November 1 – 30, 2018

  N/A   N/A   N/A   N/A

December 1 – 31, 2018

  0   $0   0   1,070,974

January 1 – 31, 2019

  0   $0   0   1,070,974

Total:

  0   $0   0   1,070,974

1The Fund announced an open market share repurchase program on November 15, 2018 pursuant to which the Fund was authorized to repurchase, through November 30, 2019, up to 5% of its common shares based on common shares outstanding on November 30, 2018, in open market transactions, subject to certain conditions.

 

Item 10 –    Submission of Matters to a Vote of Security Holders – There have been no material changes to these procedures.

 

2


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 – Not Applicable to this semi-annual report
   (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 MuniYield California Fund, Inc.
By:   /s/ John M. Perlowski                    
  John M. Perlowski
  Chief Executive Officer (principal executive officer) of
  BlackRock MuniYield California Fund, Inc.

Date: April 5, 2019

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 MuniYield California Fund, Inc.

Date: April 5, 2019

 

By:   /s/ Neal J. Andrews                    
  Neal J. Andrews
  Chief Financial Officer (principal financial officer) of
  BlackRock MuniYield California Fund, Inc.

Date: April 5, 2019

 

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