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 811-05570
---------------------
Nuveen Premium Income Municipal Fund, Inc.
------------------------------------------------------------------------------
(Exact name of registrant as specified in charter)
Nuveen Investments
333 West Wacker Drive
Chicago, IL 60606
------------------------------------------------------------------------------
(Address of principal executive offices) (Zip code)
Jessica R. Droeger
Nuveen Investments
333 West Wacker Drive
Chicago, IL 60606
------------------------------------------------------------------------------
(Name and address of agent for service)
Registrant's telephone number, including area code: (312) 917-7700
-------------------
Date of fiscal year end: October 31
------------------
Date of reporting period: October 31, 2004
------------------
Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. REPORTS TO STOCKHOLDERS.
ANNUAL REPORT October 31, 2004
Nuveen Investments
Municipal Closed-End
Exchange-Traded
Funds
NUVEEN PREMIUM INCOME MUNICIPAL FUND, INC.
NPI
NUVEEN PREMIUM INCOME MUNICIPAL FUND 2, INC.
NPM
NUVEEN PREMIUM INCOME MUNICIPAL FUND 4, INC.
NPT
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Photo of: Timothy R. Schwertfeger
Timothy R. Schwertfeger
Chairman of the Board
Chairman's
LETTER TO SHAREHOLDERS
Once again, I am pleased to report that over the most recent fiscal year your
Fund continued to provide you with monthly tax-free income and an attractive
total return. For more specific information about the performance of your Fund,
please see the Portfolio Managers' Perspectives and Performance Overview
sections of this report.
With longer-term interest rates still relatively low, many investors have begun
to wonder whether these rates will soon begin to rise, and whether that makes
this the time to adjust their holdings of fixed-income investments. No one knows
what the future will bring, which is why we think a well-balanced portfolio that
is structured and carefully monitored with the help of an investment
professional can be an impor-
"OUR MISSION CONTINUES TO BE TO ASSIST YOU AND YOUR FINANCIAL ADVISOR BY
OFFERING THE INVESTMENT SERVICES AND PRODUCTS THAT CAN HELP YOU TO SECURE YOUR
FINANCIAL OBJECTIVES."
tant component in achieving your long-term financial goals. A well-diversified
portfolio may actually help to reduce your overall investment risk, and we
believe that a municipal bond investment like your Nuveen Fund can be an
important building block in a portfolio designed to perform well through a
variety of market conditions.
As in past reports, I'd also like to direct your attention to the inside front
cover, which explains the quick and easy process to begin receiving these Fund
reports via e-mail and the internet. Thousands of Nuveen Fund shareholders
already have signed-up, and they are getting their Fund information faster and
more conveniently than ever. I urge you to consider joining them.
At Nuveen Investments, our mission continues to be to assist you and your
financial advisor by offering the investment services and products that can help
you to secure your financial objectives. We are grateful that you have chosen us
as a partner as you pursue your financial goals, and we look forward to
continuing to earn your trust in the months and years ahead.
Sincerely,
/s/ Timothy R. Schwertfeger
Timothy R. Schwertfeger
Chairman of the Board
December 15, 2004
Nuveen Municipal Closed-End Exchange-Traded Funds
NPI, NPM, NPT
Portfolio Managers'
PERSPECTIVE
Portfolio managers Dan Solender and Tom Spalding discuss the economic and market
environment, key investment strategies, and the fiscal year performance of these
three Nuveen Funds. With twelve years of investment experience, including eight
at Nuveen, Dan assumed portfolio management responsibility for NPI and NPM in
2003. A 27-year veteran of Nuveen, Tom has managed NPT since 2003.
WHAT FACTORS AFFECTED THE U.S. ECONOMY AND MUNICIPAL MARKET DURING THE ANNUAL
REPORTING PERIOD ENDED OCTOBER 31, 2004?
During this fiscal year, the U.S. economy demonstrated improvement in a number
of key areas, although the pace of the recovery slowed over the last six months
of the period. As one example, the gross domestic product (GDP) expanded at
annualized rates of 4.2% in the fourth quarter of 2003 and 4.5% in the first
quarter of 2004. However, sharply higher energy prices restrained consumer
spending during the second and third quarters of 2004, which in turn impacted
economic momentum. Over this period, GDP growth moderated to 3.3% annualized in
the second quarter and 3.9% annualized in the third quarter.
Higher energy costs also continued to fuel lingering concerns about inflation.
Although monthly gains in consumer prices were generally tame, by the end of
October 2004 inflation was running well ahead of the 2003 pace. The Consumer
Price Index (CPI) rose at a 3.9% annualized rate for the first 10 months of
2004, more than double the 1.9% rate for all of 2003. Excluding energy and food,
the CPI increased at an annual rate of 2.4% over the first 10 months of 2004.
During the second quarter of 2004 in particular, inflation worries, the slowing
pace of economic recovery and continued geopolitical uncertainty acted as
catalysts for heightened volatility in the fixed-income markets. As one example,
the yield on the Bond Buyer 25 Revenue Bond Index (BB25), a widely followed
municipal bond index, began this reporting period at 5.24%. The BB25 yield then
dropped steadily over the next five months to 4.73% by mid-March 2004. As a
series of improved employment reports sparked increased anticipation of action
by the Federal Reserve to raise short-term interest rates, the BB25 index yield
began to climb again, rising more than 70 basis points over the next eight weeks
to 5.45%, where it hovered through the end of June. However, more bond-friendly
news--including indications of relatively slow growth of wages and
employment--prompted a retreat to 4.97% by the end of October 2004.
While intermediate and long-term bond yields generally fell over most of the
second half of the Funds' fiscal years, short-term rates slowly rose. The
Federal Reserve instituted three different one-quarter-point increases in the
fed funds rate between June and September 2004. (On both November 10 and
December 14, following the end of this reporting period, the Fed added
additional quarter-point increases, bringing the fed funds rate to 2.25%.)
4
Over the 12 month period, municipal new issue supply nationwide remained
relatively strong, with $363.4 billion in new bonds coming to market. This
represented a decrease of about 5% from the preceding 12-month period, as the
improving economy and higher tax revenues lessened the need for some issuers to
borrow.
IN THIS ENVIRONMENT, WHAT KEY STRATEGIES WERE USED TO MANAGE THESE FUNDS DURING
THE 12 MONTHS ENDED OCTOBER 31, 2004?
As the market continued to anticipate increased interest rates, our focus during
this reporting period remained on finding bonds with the potential to add value
and perform well under a variety of market scenarios. This included purchasing
attractive bonds that we believed would enhance the Funds' yield curve
positioning and help to mitigate interest rate risk. Interest rate risk is the
risk that the value of a Fund's portfolio will decline if market interest rates
rise (since bond prices move in the opposite direction of market interest
rates). In general, our purchase activity in NPI and NPM emphasized securities
that mature in 15 to 22 years, while NPT focused on bonds with maturities in the
20 to 25 year range. In many cases, bonds in this long-intermediate part of the
yield curve offered yields similar to those of longer-term bonds with less
inherent interest rate risk and, we believed, greater total return potential.
Demand for municipal securities remained firm through most of this reporting
period, which limited our ability to find bonds with attractive prices, yields
and structures. Because many insured and limited tax obligation bonds were
issued during the fiscal year, we often looked at these for purchase
opportunities. Consequently, the allocations to limited tax obligation bonds
increased in all three of the Funds over the course of the 12-month period.
We also sought to purchase higher-coupon bonds to help mitigate interest rate
risk and we worked to enhance the Funds' call protection by selling or removing
some bonds with short call dates and reinvesting the proceeds in longer-term
bonds with better call protection.
While all of the Funds continued to be well diversified geographically, we also
took advantage of price and yield differences between similar bonds issued in
different states to purchase securities that we believed offered stronger
performance potential and better liquidity. This was particularly true for NPI
and NPM, which purchased bonds issued in higher tax states such as California
and New York. These states' relatively high state income tax rates tend to make
the yields on municipal bonds issued there very attractive. As the markets
fluctuate, these attractive yields can help maintain demand for these securities
and provide a measure of support for their prices.
5
HOW DID THE FUNDS PERFORM?
Individual results for these Funds, as well as for relevant comparative indexes,
are presented in the accompanying table.
TOTAL RETURNS ON NET ASSET VALUE
For periods ended 10/31/04
(Annualized)
1-YEAR 5-YEAR 10-YEAR
---------------------------------------------------------------------
NPI 9.00% 8.80% 7.22%
---------------------------------------------------------------------
NPM 9.77% 8.01% 8.48%
---------------------------------------------------------------------
NPT 9.90% 6.46% 7.41%
---------------------------------------------------------------------
Lehman Brothers Municipal
Bond Index1 6.03% 7.19% 7.05%
---------------------------------------------------------------------
Lipper General Leveraged
Municipal Debt Funds
Average2 8.93% 8.78% 7.86%
---------------------------------------------------------------------
Past performance is not predictive of future results.
For additional information, see the individual Performance Overview for your
Fund in this report.
For the 12 months ended October 31, 2004, the total returns on net asset value
(NAV) for all three Funds in this report outperformed the return on the Lehman
Brothers Municipal Bond Index. All three Funds also outperformed the average
return of their Lipper peer group for this period.
One of the primary factors benefiting the 12-month performances of the Funds
relative to that of the unleveraged Lehman Brothers index was the Funds' use of
financial leverage. While leverage can add volatility to the Funds' NAVs and
share prices, especially when substantial shifts in interest rates occur, this
strategy also can provide opportunities for additional income and total returns
for common shareholders when short-term interest rates remain low, as they did
during this period.
All three Funds also benefited from their holdings of lower-rated bonds, which
generally outperformed higher-rated bonds as the economy improved and demand for
lower-rated bonds increased. Among the lower-rated bonds making positive
contributions to the Funds' total returns during this period were those issued
by the healthcare sector, especially hospital bonds. The performance of the
healthcare sector as a whole ranked second among the Lehman Brothers Index's
revenue sectors for the 12-month period. In particular, NPM and NPT benefited
from their holdings of bonds issued by the Michigan State Hospital Finance
Authority for Detroit Medical Center, which appreciated in price as the center's
financial situation continued to improve. As of October 31, 2004, exposure to
the healthcare sector in these Funds was 11.5% in NPI, 11.3% in NPM and 12.4% in
NPT.
The Funds' returns were also helped by the strong performance of their holdings
of uninsured bonds backed by the 1998 master tobacco settlement agreement. Over
this 12-month period, NPT maintained an exposure of approximately 5% to tobacco
bonds, while NPI and NPM continued to allocate approximately 2% to this sector.
1 The Lehman Brothers Municipal Bond Index is an unleveraged, unmanaged
national index comprising a broad range of investment-grade municipal
bonds. Results for the Lehman index do not reflect any expenses.
2 The Lipper General Leveraged Municipal Debt Funds category average is
calculated using the returns of all closed-end exchange-traded funds in
this category for each period as follows: 1 year, 65 funds; 5 years, 51
funds; and 10 years, 46 funds. Fund and Lipper returns assume reinvestment
of dividends.
6
One sector that did not perform well during this period was housing, both
multifamily and single family. The housing sector, as a whole, ranked at the
bottom of the Lehman Brothers Index's revenue sectors for the 12-month period.
The sector's below-market performance stemmed largely from the increase in
mortgage prepayments as interest rates remained low, which resulted in a number
of bond calls. As of October 31, 2004, all three Funds had 6% to 9% of their
holdings in housing bonds. These bonds had a negative impact on the Funds' total
returns for the one-year period.
HOW ABOUT THE FUNDS' DIVIDENDS AND SHARE PRICES?
With short-term interest rates remaining relatively low throughout this
reporting period, the leveraged structures of these Funds continued to support
their dividend-paying capabilities. The extent of this benefit is tied in part
to the short-term rates these Funds pay their MuniPreferred(R) shareholders.
During periods of low short-term rates, leveraged Funds generally pay lower
dividends to their MuniPreferred shareholders, which can leave more earnings to
support common share dividends. This use of leverage helped to maintain the
dividends of NPI, NPM, and NPT throughout the reporting period.
All of these Funds seek to pay stable dividends at rates that reflect each
Fund's past results and projected future performance. During certain periods,
each Fund may pay dividends at a rate that may be more or less than the amount
of net investment income actually earned by the Fund during the period. If a
Fund has cumulatively earned more than it has paid in dividends, it holds the
excess in reserve as undistributed net investment income (UNII) as part of the
Fund's NAV. Conversely, if a Fund has cumulatively paid dividends in excess of
its earnings, the excess constitutes negative UNII that is likewise reflected in
the Fund's NAV. Each Fund will, over time, pay all of its net investment income
as dividends to shareholders. As of October 31, 2004, all three Funds in this
report had positive UNII balances for both financial statement and tax purposes.
As of October 31, 2004, all three of these Funds were trading at discounts to
their NAVs. These discounts were generally in line with the Funds' average
discounts over the entire 12-month reporting period.
HOW WERE THE FUNDS POSITIONED IN TERMS OF CREDIT QUALITY AND BOND CALLS AS OF
OCTOBER 31, 2004?
In the current geopolitical and economic climate, we continued to believe that
maintaining strong credit quality was an important requirement. As of October
31, 2004, each of these three Funds continued to offer excellent credit quality,
with allocations of bonds rated AAA/U.S. guaranteed and AA ranging from 75% in
NPM to 77% in NPI and 79% in NPT.
As of October 31, 2004, the potential call exposure for these Funds during
2004-2006 was 14% in NPI, 16% in NPM and 15% in NPT. The number of actual bond
calls in all of these Funds depends largely on market interest rates in the
future.
7
Nuveen Premium Income Municipal Fund, Inc.
NPI
Performance
OVERVIEW As of October 31, 2004
Pie Chart:
CREDIT QUALITY
(as a % of total investments)
AAA/U.S. Guaranteed 64%
AA 13%
A 16%
BBB 5%
NR 2%
Bar Chart:
2003-2004 MONTHLY TAX-FREE DIVIDENDS PER SHARE2
Nov 0.08
Dec 0.08
Jan 0.08
Feb 0.08
Mar 0.08
Apr 0.08
May 0.08
Jun 0.08
Jul 0.08
Aug 0.08
Sep 0.08
Oct 0.08
Line Chart:
SHARE PRICE PERFORMANCE
Weekly Closing Price
Past performance is not predictive of future results.
11/1/03 14.13
14.17
14.16
14.27
14.4
14.25
14.38
14.39
14.46
14.8
14.99
14.92
14.75
14.89
15.01
14.89
15.11
15.15
15.16
15.18
14.99
14.7
13.79
13.54
13.2
12.72
12.72
12.88
13.33
13.17
12.95
13.06
13.48
13.66
13.7
13.58
13.84
14.03
14
14.03
14.2
14.13
14.34
14.34
14.35
14.15
14.33
14.22
14.25
10/31/04 14.3
FUND SNAPSHOT
------------------------------------
Share Price $14.30
------------------------------------
Common Share
Net Asset Value $15.20
------------------------------------
Premium/(Discount) to NAV -5.92%
------------------------------------
Market Yield 6.71%
------------------------------------
Taxable-Equivalent Yield1 9.32%
------------------------------------
Net Assets Applicable to
Common Shares ($000) $969,539
------------------------------------
Average Effective Maturity
on Securities (Years) 17.09
------------------------------------
Leverage-Adjusted Duration 8.71
------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 7/18/88)
------------------------------------
ON SHARE PRICE ON NAV
------------------------------------
1-Year 8.82% 9.00%
------------------------------------
5-Year 10.01% 8.80%
------------------------------------
10-Year 7.62% 7.22%
------------------------------------
STATES
(as a % of total investments)
------------------------------------
New York 10.3%
------------------------------------
California 10.3%
------------------------------------
Texas 8.6%
------------------------------------
Illinois 6.6%
------------------------------------
Nevada 6.0%
------------------------------------
Massachusetts 5.7%
------------------------------------
Washington 5.2%
------------------------------------
New Jersey 4.3%
------------------------------------
South Carolina 3.5%
------------------------------------
Michigan 3.5%
------------------------------------
Minnesota 3.4%
------------------------------------
Colorado 3.1%
------------------------------------
District of Columbia 3.0%
------------------------------------
Pennsylvania 2.8%
------------------------------------
Indiana 2.7%
------------------------------------
Missouri 2.0%
------------------------------------
Other 19.0%
------------------------------------
SECTORS
(as a % of total investments)
------------------------------------
Tax Obligation/Limited 20.9%
------------------------------------
Tax Obligation/General 17.8%
------------------------------------
Healthcare 11.5%
------------------------------------
U.S. Guaranteed 10.6%
------------------------------------
Utilities 9.4%
------------------------------------
Transportation 8.9%
------------------------------------
Education and Civic
Organizations 7.9
------------------------------------
Other 13.0%
------------------------------------
1 Taxable-equivalent yield represents the yield that must be earned on a
fully taxable investment in order to equal the yield of the Fund on an
after-tax basis. It is based on a federal income tax rate of 28%. For
investments that generate qualified dividend income, the taxable-equivalent
yield is lower.
2 The Fund also paid shareholders a net ordinary income distribution in
December 2003 of $0.0042 per share.
8
Nuveen Premium Income Municipal Fund 2, Inc.
NPM
Performance
OVERVIEW As of October 31, 2004
Pie Chart:
CREDIT QUALITY
(as a % of total investments)
AAA/U.S. Guaranteed 63%
AA 12%
A 15%
BBB 6%
NR 4%
Bar Chart:
2003-2004 MONTHLY TAX-FREE DIVIDENDS PER SHARE2
Nov 0.0815
Dec 0.0815
Jan 0.0815
Feb 0.0815
Mar 0.0815
Apr 0.0815
May 0.0815
Jun 0.0815
Jul 0.0815
Aug 0.0815
Sep 0.0815
Oct 0.0815
Line Chart:
SHARE PRICE PERFORMANCE
Weekly Closing Price
Past performance is not predictive of future results.
11/1/03 14.32
14.44
14.38
14.43
14.47
14.47
14.45
14.39
14.48
14.81
15.31
15.31
15.06
15.28
15.29
15.02
15.34
15.4
15.42
15.3
15.11
14.84
14.21
13.91
13.47
12.95
13.12
13.22
13.45
13.5
13.09
13.3
13.67
13.81
13.87
13.62
13.79
14.11
14.19
14.28
14.44
14.37
14.63
14.67
14.49
14.33
14.45
14.46
14.5
10/31/04 14.57
FUND SNAPSHOT
------------------------------------
Share Price $14.57
------------------------------------
Common Share
Net Asset Value $15.53
------------------------------------
Premium/(Discount) to NAV -6.18%
------------------------------------
Market Yield 6.71%
------------------------------------
Taxable-Equivalent Yield1 9.32%
------------------------------------
Net Assets Applicable to
Common Shares ($000) $637,981
------------------------------------
Average Effective Maturity
on Securities (Years) 16.51
------------------------------------
Leverage-Adjusted Duration 9.82
------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 7/23/92)
------------------------------------
ON SHARE PRICE ON NAV
------------------------------------
1-Year 9.48% 9.77%
------------------------------------
5-Year 7.20% 8.01%
------------------------------------
10-Year 9.57% 8.48%
------------------------------------
STATES
(as a % of total investments)
------------------------------------
New York 13.6%
------------------------------------
Illinois 11.5%
------------------------------------
Texas 8.4%
------------------------------------
California 6.9%
------------------------------------
Washington 6.2%
------------------------------------
South Carolina 6.2%
------------------------------------
Massachusetts 4.4%
------------------------------------
Missouri 4.2%
------------------------------------
Nevada 3.6%
------------------------------------
Ohio 3.6%
------------------------------------
Minnesota 3.4%
------------------------------------
New Jersey 2.3%
------------------------------------
Indiana 2.2%
------------------------------------
Oregon 1.7%
------------------------------------
Rhode Island 1.7%
------------------------------------
Other 20.1%
------------------------------------
SECTORS
(as a % of total investments)
------------------------------------
Tax Obligation/General 21.7%
------------------------------------
Tax Obligation/Limited 17.0%
------------------------------------
Utilities 12.9%
------------------------------------
Healthcare 11.3%
------------------------------------
U.S. Guaranteed 10.9%
------------------------------------
Education and Civic
Organizations 5.9%
------------------------------------
Transportation 5.8%
------------------------------------
Housing/Multifamily 4.5%
------------------------------------
Other 10.0%
------------------------------------
1 Taxable-equivalent yield represents the yield that must be earned on a
fully taxable investment in order to equal the yield of the Fund on an
after-tax basis. It is based on a federal income tax rate of 28%. For
investments that generate qualified dividend income, the taxable-equivalent
yield is lower.
2 The Fund also paid shareholders a net ordinary income distribution in
December 2003 of $0.0060 per share.
9
Nuveen Premium Income Municipal Fund 4, Inc.
NPT
Performance
OVERVIEW As of October 31, 2004
Pie Chart:
CREDIT QUALITY
(as a % of total investments)
AAA/U.S. Guaranteed 68%
AA 11%
A 11%
BBB 6%
NR 3%
BB or Lower 1%
Bar Chart:
2003-2004 MONTHLY TAX-FREE DIVIDENDS PER SHARE2
Nov 0.071
Dec 0.071
Jan 0.071
Feb 0.071
Mar 0.071
Apr 0.071
May 0.071
Jun 0.071
Jul 0.071
Aug 0.071
Sep 0.071
Oct 0.071
Line Chart:
SHARE PRICE PERFORMANCE
Weekly Closing Price
Past performance is not predictive of future results.
11/1/03 12.52
12.6
12.65
12.83
12.82
12.68
12.75
12.69
12.72
13.11
13.3
13.43
13.24
13.3
13.34
13.31
13.39
13.45
13.58
13.59
13.46
13.3
12.29
12.05
11.8
11.31
11.36
11.42
11.89
11.78
11.49
11.58
11.97
12.15
12.19
12.1
12.12
12.32
12.36
12.41
12.53
12.55
12.67
12.67
12.78
12.5
12.69
12.59
12.64
10/31/04 12.74
FUND SNAPSHOT
------------------------------------
Share Price $12.74
------------------------------------
Common Share
Net Asset Value $13.54
------------------------------------
Premium/(Discount) to NAV -5.91%
------------------------------------
Market Yield 6.69%
------------------------------------
Taxable-Equivalent Yield1 9.29%
------------------------------------
Net Assets Applicable to
Common Shares ($000) $585,284
------------------------------------
Average Effective Maturity
on Securities (Years) 17.53
------------------------------------
Leverage-Adjusted Duration 9.42
------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 2/19/93)
------------------------------------
ON SHARE PRICE ON NAV
------------------------------------
1-Year 8.98% 9.90%
------------------------------------
5-Year 6.72% 6.46%
------------------------------------
10-Year 8.41% 7.41%
------------------------------------
STATES
(as a % of total investments)
------------------------------------
Texas 11.2%
------------------------------------
Illinois 9.5%
------------------------------------
New York 8.5%
------------------------------------
Washington 6.2%
------------------------------------
Indiana 5.6%
------------------------------------
California 4.7%
------------------------------------
Florida 4.7%
------------------------------------
Utah 4.2%
------------------------------------
Michigan 3.4%
------------------------------------
Colorado 3.3%
------------------------------------
District of Columbia 3.0%
------------------------------------
Nevada 3.0%
------------------------------------
New Jersey 2.4%
------------------------------------
South Carolina 2.3%
------------------------------------
Alabama 2.2%
------------------------------------
Puerto Rico 2.1%
------------------------------------
North Carolina 2.1%
------------------------------------
Ohio 2.1%
------------------------------------
Rhode Island 2.0%
------------------------------------
Other 17.5%
------------------------------------
SECTORS
(as a % of total investments)
------------------------------------
Tax Obligation/Limited 16.3%
------------------------------------
Tax Obligation/General 15.4%
------------------------------------
Utilities 13.1%
------------------------------------
Healthcare 12.4%
------------------------------------
U.S. Guaranteed 11.5%
------------------------------------
Housing/Multifamily 6.8%
------------------------------------
Transportation 6.3%
------------------------------------
Water and Sewer 5.6%
------------------------------------
Consumer Staples 5.1%
------------------------------------
Education and Civic
Organizations 5.0%
------------------------------------
Other 2.5%
------------------------------------
1 Taxable-equivalent yield represents the yield that must be earned on a
fully taxable investment in order to equal the yield of the Fund on an
after-tax basis. It is based on a federal income tax rate of 28%. For
investments that generate qualified dividend income, the taxable-equivalent
yield is lower.
2 The Fund also paid shareholders a net ordinary income distribution in
December 2003 of $0.0165 per share.
10
Shareholder
MEETING REPORT
The annual shareholder meeting was held on August 3, 2004, at the Northern Trust
Bank, Chicago, Illinois.
NPI NPM NPT
------------------------------------------------------------------------------------------------------------------------------------
APPROVAL OF THE BOARD MEMBERS WAS
REACHED AS FOLLOWS:
Common and Common and Common and
MuniPreferred MuniPreferred MuniPreferred MuniPreferred MuniPreferred MuniPreferred
shares voting shares voting shares voting shares voting shares voting shares voting
together together together together together together
as a class as a class as a class as a class as a class as a class
====================================================================================================================================
Robert P. Bremner
For 55,426,187 -- 37,462,344 -- 39,322,479 --
Withhold 691,707 -- 529,420 -- 438,564 --
------------------------------------------------------------------------------------------------------------------------------------
Total 56,117,894 -- 37,991,764 -- 39,761,043 --
====================================================================================================================================
Lawrence H. Brown
For 55,416,675 -- 37,463,274 -- 39,322,017 --
Withhold 701,219 -- 528,490 -- 439,026 --
------------------------------------------------------------------------------------------------------------------------------------
Total 56,117,894 -- 37,991,764 -- 39,761,043 --
====================================================================================================================================
Jack B. Evans
For 55,410,085 -- 37,454,552 -- 39,303,842 --
Withhold 707,809 -- 537,212 -- 457,201 --
------------------------------------------------------------------------------------------------------------------------------------
Total 56,117,894 -- 37,991,764 -- 39,761,043 --
====================================================================================================================================
William C. Hunter
For 55,417,987 -- 37,445,898 -- 39,302,487 --
Withhold 699,907 -- 545,866 -- 458,556 --
------------------------------------------------------------------------------------------------------------------------------------
Total 56,117,894 -- 37,991,764 -- 39,761,043 --
====================================================================================================================================
William J. Schneider
For -- 17,396 -- 13,332 -- 13,199
Withhold -- 92 -- 13 -- 49
------------------------------------------------------------------------------------------------------------------------------------
Total -- 17,488 -- 13,345 -- 13,248
====================================================================================================================================
Timothy R. Schwertfeger
For -- 17,396 -- 13,330 -- 13,204
Withhold -- 92 -- 15 -- 44
------------------------------------------------------------------------------------------------------------------------------------
Total -- 17,488 -- 13,345 -- 13,248
====================================================================================================================================
Judith M. Stockdale
For 55,419,912 -- 37,455,003 -- 39,311,928 --
Withhold 697,982 -- 536,761 -- 449,115 --
------------------------------------------------------------------------------------------------------------------------------------
Total 56,117,894 -- 37,991,764 -- 39,761,043 --
====================================================================================================================================
11
Report of
INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM
THE BOARD OF DIRECTORS AND SHAREHOLDERS
NUVEEN PREMIUM INCOME MUNICIPAL FUND, INC.
NUVEEN PREMIUM INCOME MUNICIPAL FUND 2, INC.
NUVEEN PREMIUM INCOME MUNICIPAL FUND 4, INC.
We have audited the accompanying statements of assets and liabilities, including
the portfolios of investments, of Nuveen Premium Income Municipal Fund, Inc.,
Nuveen Premium Income Municipal Fund 2, Inc. and Nuveen Premium Income Municipal
Fund 4, Inc. as of October 31, 2004, and the related statements of operations
for the year then ended, the statements of changes in net assets for each of the
two years in the period then ended, and the financial highlights for each of the
five years in the period then ended. These financial statements and financial
highlights are the responsibility of the Funds' management. Our responsibility
is to express an opinion on these financial statements and financial highlights
based on our audits.
We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements and financial highlights. Our procedures
included confirmation of investments owned as of October 31, 2004, by
correspondence with the custodian and brokers or by other appropriate auditing
procedures where replies from brokers were not received. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial positions of
Nuveen Premium Income Municipal Fund, Inc., Nuveen Premium Income Municipal Fund
2, Inc. and Nuveen Premium Income Municipal Fund 4, Inc. at October 31, 2004,
the results of their operations for the year then ended, the changes in their
net assets for each of the two years in the period then ended, and the financial
highlights for each of the five years in the period then ended in conformity
with U.S. generally accepted accounting principles.
/s/ Ernst & Young LLP
Chicago, Illinois
December 15, 2004
12
Nuveen Premium Income Municipal Fund, Inc. (NPI)
Portfolio of
INVESTMENTS October 31, 2004
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
ALABAMA - 1.3% (0.9% OF TOTAL INVESTMENTS)
$ 4,050 Alabama 21st Century Authority, Tobacco Settlement Revenue 6/10 at 102.00 A- $ 4,206,371
Bonds, Series 2000, 6.125%, 12/01/16
5,020 DCH Health Care Authority, Alabama, Healthcare Facilities 6/12 at 101.00 A+ 5,294,694
Revenue Bonds, Series 2002, 5.250%, 6/01/18
3,330 University of South Alabama, Student Tuition Revenue Bonds, 3/14 at 100.00 Aaa 3,525,304
Series 2004, 5.000%, 3/15/23 - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
ALASKA - 0.9% (0.6% OF TOTAL INVESTMENTS)
Anchorage, Alaska, General Obligation Refunding Bonds,
Series 2003A:
2,000 5.250%, 9/01/17 - FGIC Insured 9/13 at 100.00 AAA 2,218,260
2,035 5.250%, 9/01/18 - FGIC Insured 9/13 at 100.00 AAA 2,245,826
5,000 Northern Tobacco Securitization Corporation, Alaska, 6/10 at 100.00 BBB 4,725,600
Tobacco Settlement Asset-Backed Bonds, Series 2000,
6.500%, 6/01/31
------------------------------------------------------------------------------------------------------------------------------------
ARIZONA - 1.8% (1.2% OF TOTAL INVESTMENTS)
5,000 Arizona School Facilities Board, Certificates of Participation, 9/13 at 100.00 AAA 5,521,950
Series 2003B, 5.250%, 9/01/18 - FGIC Insured
6,775 Pima County Industrial Development Authority, Arizona, 1/05 at 101.50 AAA 7,156,433
Lease Obligation Revenue Refunding Bonds, Tucson
Electric Power Company, Series 1988A, 7.250%, 7/15/10 -
FSA Insured
4,130 University of Arizona, Certificates of Participation, 6/12 at 100.00 AAA 4,474,938
Series 2002B, 5.125%, 6/01/18 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
ARKANSAS - 1.1% (0.8% OF TOTAL INVESTMENTS)
3,500 Arkansas Development Finance Authority, Drivers License 6/07 at 100.00 AAA 3,759,665
Revenue Bonds, Arkansas State Police Headquarters and
Wireless Data Equipment, Series 1997, 5.400%, 6/01/18 -
FGIC Insured
480 Paragould, Arkansas, Water, Sewer and Electric Revenue 12/10 at 100.00 AAA 534,744
Bonds, Series 2000, 5.650%, 12/01/25 - AMBAC Insured
1,000 Sebastian County Community Junior College District, 4/09 at 100.00 AAA 1,141,540
Arkansas, General Obligation Improvement Bonds,
Series 1999, 5.950%, 4/01/29 (Pre-refunded
to 4/01/09) - AMBAC Insured
5,245 University of Arkansas, Fayetteville, Athletic Facilities 9/09 at 100.00 Aaa 5,641,994
Revenue Bonds, Razorback Stadium, Series 1999,
5.050%, 9/15/20 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA - 15.9% (10.3% OF TOTAL INVESTMENTS)
9,200 Alameda Corridor Transportation Authority, California, No Opt. Call AAA 4,360,156
Subordinate Lien Revenue Bonds, Series 2004A,
0.000%, 10/01/20 - AMBAC Insured
California Health Facilities Financing Authority, Health
Facility Revenue Bonds, Adventist Health System/ West, Series
2003A:
3,700 5.000%, 3/01/28 3/13 at 100.00 A 3,725,604
7,000 5.000%, 3/01/33 3/13 at 100.00 A 7,020,860
5,500 California Health Facilities Financing Authority, Health No Opt. Call BBB+ 5,764,605
Facility Revenue Bonds, Catholic Healthcare West,
Series 2004I, 4.950%, 7/01/26 (Mandatory put 7/01/14)
California, General Obligation Bonds, Series 2004:
5,000 5.000%, 4/01/10 No Opt. Call A 5,490,300
2,000 5.125%, 2/01/25 2/14 at 100.00 A 2,099,040
10,000 5.125%, 2/01/26 2/14 at 100.00 A 10,448,900
4,000 California Department of Water Resources, Power Supply 5/12 at 101.00 A2 4,682,720
Revenue Bonds, Series 2002A, 6.000%, 5/01/15
4,000 California, Economic Recovery Revenue Bonds, No Opt. Call AA- 4,568,200
Series 2004A, 5.250%, 7/01/14
23,725 California State Public Works Board, Lease Revenue 12/04 at 101.00 Aa2 24,011,124
Refunding Bonds, Various University of California Projects,
Series 1993A, 5.500%, 6/01/21
13
Nuveen Premium Income Municipal Fund, Inc. (NPI) (continued)
Portfolio of INVESTMENTS October 31, 2004
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA (continued)
$ 11,395 California State Public Works Board, Lease Revenue Bonds, No Opt. Call A- $ 12,351,041
Department of Corrections, Series 1993E, 5.500%, 6/01/15
3,575 Chula Vista, California, Industrial Development Revenue 6/14 at 102.00 A2 3,833,973
Bonds, San Diego Gas and Electric Company, Series 1996A,
5.300%, 7/01/21
1,170 Martinez, California, Home Mortgage Revenue Bonds, No Opt. Call AAA 1,668,022
Series 1983A, 10.750%, 2/01/16
4,750 North Orange County Community College District, California, 8/14 at 100.00 AAA 5,136,270
General Obligation Bonds, Series 2003B, 5.000%, 8/01/20 -
FGIC Insured
20,000 Pomona, California, GNMA/FNMA Collateralized Securities No Opt. Call AAA 26,966,200
Program Single Family Mortgage Revenue Bonds,
Series 1990A, 7.600%, 5/01/23
5,000 Rancho Mirage Joint Powers Financing Authority, 7/14 at 100.00 A3 5,327,950
California, Revenue Bonds, Eisenhower Medical Center,
Series 2004, 5.875%, 7/01/26
3,700 Sacramento Municipal Utility District, California, Electric 8/13 at 100.00 AAA 3,936,541
Revenue Bonds, Series 2003R, 5.000%, 8/15/22 -
MBIA Insured
San Bernardino Joint Powers Financing Authority, California, Tax
Allocation Refunding Bonds, Multiple Projects, Series 1995A:
6,675 5.750%, 10/01/15 - FSA Insured 10/05 at 102.00 AAA 7,047,999
10,000 5.750%, 10/01/25 - FSA Insured 10/05 at 102.00 AAA 10,513,100
San Joaquin Hills Transportation Corridor Agency, Orange County,
California, Toll Road Revenue Refunding Bonds, Series 1997A:
10,000 0.000%, 1/15/31 - MBIA Insured No Opt. Call AAA 2,490,100
9,025 0.000%, 1/15/36 - MBIA Insured No Opt. Call AAA 1,713,396
------------------------------------------------------------------------------------------------------------------------------------
COLORADO - 4.6% (3.1% OF TOTAL INVESTMENTS)
2,500 Centennial Water and Sanitation District, Colorado, 12/14 at 100.00 AAA 2,687,500
Water and Sewerage Revenue Bonds, Series 2004,
5.000%, 12/01/21 - FGIC Insured
1,075 Colorado Housing Finance Authority, Single Family Program 4/10 at 105.00 AA 1,114,055
Senior Bonds, Series 2000B-2, 7.250%, 10/01/31
(Alternative Minimum Tax)
780 Colorado Housing Finance Authority, Single Family Program 5/07 at 105.00 Aa2 796,544
Senior Bonds, Series 1997B-2, 7.000%, 5/01/26
(Alternative Minimum Tax)
605 Colorado Housing Finance Authority, Single Family Program 11/07 at 105.00 Aa2 616,519
Senior Bonds, Series 1997C-2, 6.875%, 11/01/28
(Alternative Minimum Tax)
9,450 Denver City and County, Colorado, Airport System Revenue No Opt. Call A 11,558,201
Bonds, Series 1991D, 7.750%, 11/15/13
(Alternative Minimum Tax)
19,810 Denver, Colorado, Excise Tax Revenue Bonds, Convention 3/11 at 100.00 AAA 22,127,374
Center, Series 2001A, 5.500%, 9/01/18 - FSA Insured
8,315 Denver City and County, Colorado, Special Facilities Airport 4/05 at 100.00 N/R 5,986,800
Revenue Bonds, United Air Lines, Inc., Series 1992A,
6.875%, 10/01/32 (Alternative Minimum Tax)#
156 El Paso County, Colorado, FNMA Mortgage-Backed Single No Opt. Call Aaa 157,378
Family Revenue Refunding Bonds, Series 1992A-2,
8.750%, 6/01/11
------------------------------------------------------------------------------------------------------------------------------------
CONNECTICUT - 0.2% (0.2% OF TOTAL INVESTMENTS)
1,930 Connecticut, General Obligation Bonds, Series 2001C, No Opt. Call AA 2,284,580
5.500%, 12/15/16
------------------------------------------------------------------------------------------------------------------------------------
DISTRICT OF COLUMBIA - 4.6% (3.0% OF TOTAL INVESTMENTS)
9,505 District of Columbia, General Obligation Bonds, Series 1998B, No Opt. Call AAA 11,625,375
6.000%, 6/01/20 - MBIA Insured
10,965 District of Columbia Housing Finance Agency, GNMA 12/04 at 103.00 AAA 11,305,025
Collateralized Single Family Mortgage Revenue Bonds,
Series 1988E-4, 6.375%, 6/01/26 (Alternative Minimum Tax)
10,350 District of Columbia, Revenue Bonds, Association of American 8/07 at 102.00 AAA 10,930,325
Medical Colleges, Series 1997A, 5.375%, 2/15/27 -
AMBAC Insured
District of Columbia, Revenue Bonds, Georgetown University,
Series 2001A:
14,105 0.000%, 4/01/24 - MBIA Insured 4/11 at 47.66 AAA 4,835,617
7,625 0.000%, 4/01/25 - MBIA Insured 4/11 at 44.82 AAA 2,442,440
16,665 0.000%, 4/01/32 - MBIA Insured 4/11 at 29.23 AAA 3,414,992
14
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
FLORIDA - 2.1% (1.4% OF TOTAL INVESTMENTS)
$ 8,000 Hillsborough County Aviation Authority, Florida, 10/13 at 100.00 AAA $ 8,796,320
Revenue Bonds, Tampa International Airport, Series 2003A,
5.375%, 10/01/16 (Alternative Minimum Tax) - MBIA Insured
5,400 Hillsborough County Industrial Development Authority, 4/10 at 101.00 N/R 5,910,192
Florida, Exempt Facilities Revenue Bonds, National
Gypsum Company Apollo Beach Project, Series 2000B,
7.125%, 4/01/30 (Alternative Minimum Tax)
5,000 Orange County Health Facilities Authority, Florida, Hospital 11/10 at 101.00 A 5,480,150
Revenue Bonds, Adventist Health System/Sunbelt Obligated
Group, Series 2000, 6.500%, 11/15/30
------------------------------------------------------------------------------------------------------------------------------------
GEORGIA - 1.9% (1.2% OF TOTAL INVESTMENTS)
2,625 Fulton County Development Authority, Georgia, Revenue 5/14 at 100.00 AAA 2,838,124
Bonds, Georgia Tech Molecular Science Building,
Series 2004, 5.250%, 5/01/24 - MBIA Insured
6,025 Fulton-DeKalb Hospital Authority, Georgia, Revenue 1/14 at 100.00 AAA 6,600,568
Refunding Certificates, Series 2003, 5.250%, 1/01/20 -
FSA Insured
4,845 Metropolitan Atlanta Rapid Transit Authority, Georgia, No Opt. Call AAA 5,986,821
Sales Tax Revenue Refunding Bonds, Series 1992P,
6.250%, 7/01/20 - AMBAC Insured
2,750 Savannah Housing Authority, Georgia, GNMA Collateralized 5/08 at 103.00 Aaa 2,932,325
Mortgage Revenue Refunding Bonds, Plantation Oak
Project, Series 2000, 6.350%, 11/20/39
------------------------------------------------------------------------------------------------------------------------------------
HAWAII - 1.1% (0.7% OF TOTAL INVESTMENTS)
10,000 Hawaii, General Obligation Bonds, Series 2003DA, 9/13 at 100.00 AAA 10,903,000
5.250%, 9/01/21 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
IDAHO - 0.6% (0.4% OF TOTAL INVESTMENTS)
5,000 Boise City, Idaho, Airport Revenue Certificates of 9/10 at 100.00 Aaa 5,347,850
Participation, Series 2000, 5.500%, 9/01/25 (Alternative
Minimum Tax) - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS - 10.1% (6.6% OF TOTAL INVESTMENTS)
9,220 Chicago Board of Education, Illinois, Unlimited Tax General 12/07 at 102.00 AAA 9,658,227
Obligation Bonds, Dedicated Tax Revenues, Series 1997A,
5.250%, 12/01/27 - AMBAC Insured
Chicago Board of Education, Illinois, Unlimited Tax General
Obligation Bonds, Dedicated Tax Revenues, Series 1998B-1:
8,890 0.000%, 12/01/16 - FGIC Insured No Opt. Call AAA 5,265,369
10,000 0.000%, 12/01/20 - FGIC Insured No Opt. Call AAA 4,698,800
9,900 0.000%, 12/01/24 - FGIC Insured No Opt. Call AAA 3,615,975
Chicago Board of Education, Illinois, Unlimited Tax General
Obligation Bonds, Dedicated Tax Revenues, Series 1999A:
15,000 0.000%, 12/01/21 - FGIC Insured No Opt. Call AAA 6,635,700
10,000 0.000%, 12/01/23 - FGIC Insured No Opt. Call AAA 3,908,800
9,000 Chicago, Illinois, Special Facility Revenue Bonds, O'Hare No Opt. Call N/R 3,240,000
International Airport, United Air Lines Inc. Project,
Series 2001A, 6.375%, 11/01/35 (Alternative Minimum
Tax) (Mandatory put 5/01/13)#
4,530 Chicago, Illinois, General Airport Second Lien Revenue 1/05 at 101.00 AAA 4,630,475
Refunding Bonds, O'Hare International Airport,
Series 1993C, 5.000%, 1/01/18 - MBIA Insured
350 Chicago, Illinois, FNMA/GNMA Collateralized Single Family 3/06 at 105.00 Aaa 351,460
Mortgage Revenue Bonds, Series 1996A,
7.000%, 9/01/27 (Alternative Minimum Tax)
875 Chicago, Illinois, FNMA/GNMA Collateralized Single Family 9/07 at 105.00 Aaa 876,453
Mortgage Revenue Bonds, Series 1997B, 6.950%, 9/01/28
(Alternative Minimum Tax)
8,740 Illinois Development Finance Authority, Pollution Control 2/05 at 101.00 AAA 8,940,496
Revenue Refunding Bonds, Illinois Power Company,
Series 1994A, 5.700%, 2/01/24 - MBIA Insured
Illinois Finance Authority, Revenue Bonds, OSF Healthcare
System, Series 2004:
1,000 5.250%, 11/15/22 5/14 at 100.00 A 1,038,380
3,000 5.250%, 11/15/23 5/14 at 100.00 A 3,096,750
1,500 Illinois Health Facilities Authority, Revenue Bonds, Highland 10/07 at 102.00 AAA 1,680,540
Park Hospital, Series 1997A, 5.750%, 10/01/26
(Pre-refunded to 10/01/07) - MBIA Insured
9,820 Illinois Health Facilities Authority, Revenue Bonds, Sherman 8/07 at 101.00 AAA 10,078,364
Health Systems, Series 1997, 5.250%, 8/01/27 -
AMBAC Insured
10,040 Metropolitan Pier and Exposition Authority, Illinois, Revenue No Opt. Call AAA 6,434,736
Bonds, McCormick Place Expansion Project, Series 1992A,
0.000%, 6/15/15 - FGIC Insured
15
Nuveen Premium Income Municipal Fund, Inc. (NPI) (continued)
Portfolio of INVESTMENTS October 31, 2004
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS (continued)
$ 9,200 Metropolitan Pier and Exposition Authority, Illinois, Revenue 12/09 at 101.00 AAA $ 10,185,044
Bonds, McCormick Place Expansion Project, Series 1999A,
5.500%, 12/15/24 - FGIC Insured
3,000 Metropolitan Pier and Exposition Authority, Illinois, Revenue No Opt. Call AAA 3,992,790
Bonds, McCormick Place Hospitality Facility, Series 1996A,
7.000%, 7/01/26
4,925 Regional Transportation Authority, Cook, DuPage, Kane, No Opt. Call AAA 5,456,851
Lake, McHenry and Will Counties, Illinois, General
Obligation Bonds, Series 1992A, 9.000%, 6/01/06 -
AMBAC Insured
785 Regional Transportation Authority, Cook, DuPage, Kane, No Opt. Call AAA 869,772
Lake, McHenry and Will Counties, Illinois, General
Obligation Bonds, Series 1992B, 9.000%, 6/01/06 -
AMBAC Insured
3,000 Upper Illinois River Valley Development Authority, 12/11 at 101.00 BBB+ 3,171,840
Healthcare Facilities Revenue Bonds, Morris Hospital,
Series 2001, 6.625%, 12/01/31
------------------------------------------------------------------------------------------------------------------------------------
INDIANA - 4.1% (2.7% OF TOTAL INVESTMENTS)
5,000 Center Grove 2000 Building Corporation, Indiana, First 7/11 at 100.00 AAA 5,454,200
Mortgage Bonds, Series 2001, 5.500%, 1/15/26 -
AMBAC Insured
Hamilton County Public Building Corporation, Indiana,
First Mortgage Bonds, Series 2004:
1,910 5.000%, 8/01/21 - FSA Insured 8/14 at 100.00 AAA 2,038,237
2,005 5.000%, 8/01/22 - FSA Insured 8/14 at 100.00 AAA 2,126,403
4,565 Indiana State Office Building Corporation, Revenue Bonds, 7/05 at 102.00 AAA 4,769,192
Correctional Facilities Program, Series 1995A,
5.500%, 7/01/20 (Pre-refunded to 7/01/05) - AMBAC Insured
7,070 Indiana Transportation Finance Authority, Highway Revenue 6/13 at 100.00 AAA 8,069,698
Bonds, Series 2003A, 5.250%, 6/01/18 (Pre-refunded
to 6/01/13) - FSA Insured
8,000 Steuben County Middle School Building Corporation, 7/05 at 102.00 AAA 8,418,080
Indiana, First Mortgage Bonds, Series 1995,
6.375%, 7/15/16 (Pre-refunded to 7/15/05) - MBIA Insured
7,965 Wawasee Community School Corporation, Indiana, 1/12 at 101.00 AA- 8,858,275
New Elementary and Remodeling Building Corporation,
First Mortgage Bonds, Series 2000, 5.750%, 1/15/20
------------------------------------------------------------------------------------------------------------------------------------
IOWA - 1.5% (1.0% OF TOTAL INVESTMENTS)
Des Moines, Iowa, General Obligation Bonds, Series 2000D:
1,215 5.750%, 6/01/17 - MBIA Insured 6/08 at 100.00 AAA 1,342,891
1,410 5.800%, 6/01/18 - MBIA Insured 6/08 at 100.00 AAA 1,560,814
3,000 Iowa Financing Authority, Private College Revenue Refunding 12/05 at 102.00 AAA 3,167,610
Bonds, Drake University Project, Series 1996,
5.400%, 12/01/16 - MBIA Insured
4,585 Iowa Finance Authority, Industrial Remarketed Revenue No Opt. Call AAA 6,520,558
Refunding Bonds, Urbandale Hotel Corporation,
Series 1989A, 8.500%, 8/01/16 (Alternative Minimum Tax)
2,000 Iowa Finance Authority, Healthcare Revenue Bonds, 7/10 at 100.00 A1 2,167,620
Genesis Medical Center, Series 2000, 6.250%, 7/01/25
------------------------------------------------------------------------------------------------------------------------------------
KANSAS - 1.3% (0.9% OF TOTAL INVESTMENTS)
6,000 Kansas Department of Transportation, Highway Revenue 3/14 at 100.00 AA+ 6,436,860
Bonds, Series 2004A, 5.000%, 3/01/21
6,160 Sedgwick and Shawnee Counties, Kansas, GNMA 6/08 at 105.00 Aaa 6,530,524
Mortgage-Backed Securities Program Single Family
Revenue Bonds, Series 1998A-1, 6.500%, 12/01/22
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
KENTUCKY - 0.4% (0.3% OF TOTAL INVESTMENTS)
Marshall County School District Finance Corporation,
Kentucky, School Building Revenue Bonds, Series 2004:
1,210 5.000%, 6/01/19 - AMBAC Insured 6/14 at 100.00 Aaa 1,315,089
1,270 5.000%, 6/01/20 - AMBAC Insured 6/14 at 100.00 Aaa 1,372,908
1,335 5.000%, 6/01/21 - AMBAC Insured 6/14 at 100.00 Aaa 1,434,351
------------------------------------------------------------------------------------------------------------------------------------
LOUISIANA - 2.7% (1.8% OF TOTAL INVESTMENTS)
2,915 Jefferson Sales Tax District, Jefferson Parish, Louisiana, 12/12 at 100.00 AAA 3,231,073
Special Sales Tax Revenue Refunding Bonds, Series 2002,
5.250%, 12/01/19 - AMBAC Insured
900 Louisiana Housing Finance Agency, Single Family Mortgage 9/09 at 101.00 Aaa 916,137
Revenue Bonds, Series 2000A, 7.450%, 12/01/31
(Alternative Minimum Tax)
11,860 Louisiana Stadium and Exposition District, Hotel Occupancy 7/05 at 102.00 AAA 12,459,523
Tax Bonds, Series 1995B, 6.375%, 7/01/25 (Pre-refunded
to 7/01/05) - FGIC Insured
16
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
LOUISIANA (continued)
$ 7,660 Louisiana Public Facilities Authority, Extended Care No Opt. Call BBB $ 9,807,251
Facilities Revenue Bonds, Comm-Care Corporation Project,
Series 1994, 11.000%, 2/01/14
------------------------------------------------------------------------------------------------------------------------------------
MARYLAND - 0.4% (0.3% OF TOTAL INVESTMENTS)
3,600 Montgomery County Housing Opportunities Commission, 7/10 at 100.00 Aaa 3,800,412
Maryland, Multifamily Housing Development Bonds,
Series 2000B, 6.200%, 7/01/30 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
MASSACHUSETTS - 8.7% (5.7% OF TOTAL INVESTMENTS)
10,000 Massachusetts Bay Transportation Authority, Assessment 7/10 at 100.00 AAA 10,547,700
Bonds, Series 2000A, 5.250%, 7/01/30
13,000 Massachusetts, General Obligation Bonds, Consolidated 6/10 at 100.00 AAA 15,119,780
Loan, Series 2000B, 6.000%, 6/01/16 (Pre-refunded
to 6/01/10)
4,000 Massachusetts, General Obligation Bonds, Series 2003D, 10/13 at 100.00 Aa2 4,504,600
5.250%, 10/01/22 (Pre-refunded to 10/01/13)
Massachusetts, General Obligation Bonds, Consolidated
Loan, Series 2002E:
11,400 5.250%, 1/01/21 (Pre-refunded to 1/01/13) - FSA Insured 1/13 at 100.00 AAA 12,854,184
1,850 5.250%, 1/01/21 (Pre-refunded to 1/01/13) - FSA Insured 1/13 at 100.00 AAA 2,085,986
2,825 Massachusetts Industrial Finance Agency, Resource 12/08 at 102.00 BBB 2,874,579
Recovery Revenue Refunding Bonds, Ogden Haverhill
Project, Series 1998A, 5.450%, 12/01/12 (Alternative
Minimum Tax)
14,750 Massachusetts Industrial Finance Agency, General 7/07 at 102.00 AAA 15,562,725
Obligation Bonds, Suffolk University, Series 1997,
5.250%, 7/01/27 - AMBAC Insured
8,750 Massachusetts Housing Finance Agency, Rental Housing 1/11 at 100.00 AAA 9,162,300
Mortgage Revenue Bonds, Series 2001A, 5.850%, 7/01/35
(Alternative Minimum Tax) - AMBAC Insured
Massachusetts, Special Obligation Dedicated Tax
Revenue Bonds, Series 2004:
7,000 5.250%, 1/01/22 - FGIC Insured 1/14 at 100.00 AAA 7,607,040
3,820 5.250%, 1/01/24 - FGIC Insured 1/14 at 100.00 AAA 4,117,960
------------------------------------------------------------------------------------------------------------------------------------
MICHIGAN - 5.3% (3.5% OF TOTAL INVESTMENTS)
Detroit, Michigan, General Obligation Bonds, Series 2003A:
3,565 5.250%, 4/01/22 - XLCA Insured 4/13 at 100.00 AAA 3,803,356
1,275 5.250%, 4/01/23 - XLCA Insured 4/13 at 100.00 AAA 1,353,770
Detroit, Michigan, Sewerage Disposal System Revenue
Bonds, Series 1995A:
2,700 5.000%, 7/01/25 (Pre-refunded to 7/01/05) - MBIA Insured 7/05 at 100.00 AAA 2,758,401
6,580 5.000%, 7/01/25 (Pre-refunded to 7/01/05) - MBIA Insured 7/05 at 100.00 AAA 6,722,325
1,270 5.000%, 7/01/25 - MBIA Insured 7/05 at 100.00 AAA 1,275,131
10,510 Hudsonville Public Schools, Ottawa and Allegan Counties, 5/08 at 100.00 AAA 11,219,425
Michigan, Unlimited Tax General Obligation School Building
and Site Refunding Bonds, Series 1997, 5.150%, 5/01/22 -
FGIC Insured
10,000 Michigan State Building Authority, Revenue Refunding 10/13 at 100.00 AAA 10,565,400
Bonds, Facilities Program, Series 2003II,
5.000%, 10/15/23 - MBIA Insured
6,600 Michigan Housing Development Authority, Limited 7/07 at 102.00 AAA 6,809,022
Obligation Multifamily Mortgage Revenue Refunding
Bonds, Forest Hills Regency Square Project, Series 1999A,
5.750%, 7/01/29
6,390 Wayne County, Michigan, Airport Revenue Bonds, Detroit 12/12 at 100.00 AAA 6,970,915
Metropolitan Airport, Series 2002D, 5.500%, 12/01/19
(Alternative Minimum Tax) - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
MINNESOTA - 5.1% (3.4% OF TOTAL INVESTMENTS)
9,400 Cohasset, Minnesota, Pollution Control Revenue Bonds, 7/14 at 100.00 A 9,614,884
Allete Inc., Series 2004, 4.950%, 7/01/22
2,000 Duluth Economic Development Authority, Minnesota, 2/14 at 100.00 A- 2,092,140
Healthcare Facilities Revenue Bonds, Benedictine Health
System - St. Mary's Duluth Clinic, Series 2004,
5.375%, 2/15/22
Eden Prairie, Minnesota, GNMA Collateralized Multifamily Housing
Revenue Bonds, Rolling Hills Project, Series 2001A:
1,000 6.150%, 8/20/31 8/11 at 105.00 A1 1,092,460
2,000 6.200%, 2/20/43 8/11 at 105.00 A1 2,178,640
365 Minneapolis-St. Paul Housing Finance Board, Minnesota, 11/04 at 102.00 AAA 368,256
FNMA/GNMA Mortgage-Backed Securities Program Single
Family Mortgage Revenue Bonds, Series 1994,
7.500%, 11/01/27 (Alternative Minimum Tax)
3,000 Minneapolis-St. Paul Metropolitan Airports Commission, 1/08 at 101.00 AAA 3,179,790
Minnesota, Airport Revenue Bonds, Series 1998A,
5.000%, 1/01/22 - AMBAC Insured
17
Nuveen Premium Income Municipal Fund, Inc. (NPI) (continued)
Portfolio of INVESTMENTS October 31, 2004
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
MINNESOTA (continued)
$ 1,500 Minnesota Municipal Power Agency, Electric Revenue 10/14 at 100.00 A3 $ 1,591,650
Bonds, Series 2004A, 5.250%, 10/01/24
5,000 Minnesota Agricultural and Economic Development Board, 11/07 at 102.00 AAA 5,492,000
Healthcare System Revenue Bonds, Fairview Hospital and
Healthcare Services, Series 1997A, 5.750%, 11/15/26 -
MBIA Insured
18,990 St. Paul Housing and Redevelopment Authority, Minnesota, 11/15 at 103.00 AAA 23,971,837
Sales Tax Revenue Refunding Bonds, Civic Center Project,
Series 1996, 7.100%, 11/01/23 - FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
MISSISSIPPI - 0.4% (0.3% OF TOTAL INVESTMENTS)
4,275 Mississippi Hospital Equipment and Facilities Authority, 9/14 at 100.00 N/R 4,310,440
Revenue Bonds, Baptist Memorial Health Care,
Series 2004B-1, 5.000%, 9/01/24
------------------------------------------------------------------------------------------------------------------------------------
MISSOURI - 3.0% (2.0% OF TOTAL INVESTMENTS)
2,000 Cole County Industrial Development Authority, Missouri, 2/14 at 100.00 N/R 2,044,560
Revenue Bonds, Lutheran Senior Services - Heisinger
Project, Series 2004, 5.250%, 2/01/24
1,520 Missouri Housing Development Commission, 3/07 at 105.00 AAA 1,522,402
GNMA/FNMA Single Family Mortgage Revenue Bonds,
Homeownership Loan Program, Series 1996C,
7.450%, 9/01/27 (Alternative Minimum Tax)
Missouri Health and Educational Facilities Authority, Revenue
Bonds, SSM Healthcare System, Series 2001A:
3,000 5.250%, 6/01/21 - AMBAC Insured 6/11 at 101.00 AAA 3,212,220
4,150 5.250%, 6/01/28 - AMBAC Insured 6/11 at 101.00 AAA 4,339,116
5,720 Missouri Housing Development Commission, Single Family 3/09 at 103.00 AAA 5,952,575
Mortgage Revenue Bonds, Homeownership Loan Program,
Series 1999B-1, 6.700%, 9/01/30 (Alternative Minimum Tax)
11,120 St. Charles County Francis Howell School District, No Opt. Call AAA 12,275,368
Missouri, General Obligation Refunding Bonds,
Series 1994A, 7.800%, 3/01/08 - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
NEVADA - 9.1% (6.0% OF TOTAL INVESTMENTS)
15,000 Clark County, Nevada, General Obligation Bank Bonds, 6/11 at 100.00 AAA 15,897,750
Southern Nevada Water Authority Loan, Series 2001,
5.250%, 6/01/26 - FGIC Insured
14,810 Clark County School District, Nevada, General Obligation 12/11 at 100.00 AAA 16,713,381
Bonds, Series 2001F, 5.500%, 6/15/18 - FSA Insured
10,410 Clark County School District, Nevada, General Obligation 6/12 at 100.00 AAA 11,800,256
Bonds, Series 2002C, 5.500%, 6/15/18 - MBIA Insured
Director of Nevada State Department of Business and Industry,
Revenue Bonds, Las Vegas Monorail Project, First Tier, Series 2000:
6,425 0.000%, 1/01/29 - AMBAC Insured No Opt. Call AAA 1,782,616
12,000 5.375%, 1/01/40 - AMBAC Insured 1/10 at 100.00 AAA 12,448,080
29,410 Nevada, Limited Tax General Obligation Bonds, Colorado 1/05 at 101.00 AA 29,776,155
River Commission, Series 1994, 5.500%, 7/01/27
------------------------------------------------------------------------------------------------------------------------------------
NEW HAMPSHIRE - 0.4% (0.2% OF TOTAL INVESTMENTS)
2,570 New Hampshire Housing Finance Agency, Single Family 1/05 at 101.00 Aa2 2,592,565
Residential Mortgage Bonds, Series 1993B, 6.050%, 7/01/25
835 New Hampshire Housing Finance Agency, Single Family 7/06 at 102.00 Aa2 864,367
Mortgage Acquisition Revenue Bonds, Series 1996B,
6.400%, 1/01/27 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
NEW JERSEY - 6.6% (4.3% OF TOTAL INVESTMENTS)
10,150 Delaware River Port Authority, Pennsylvania and 1/10 at 100.00 AAA 11,126,633
New Jersey, Revenue Bonds, Port District Project,
Series 1999B, 5.625%, 1/01/26 - FSA Insured
10,000 Essex County Improvement Authority, New Jersey, General 10/10 at 100.00 Aaa 11,684,400
Obligation Guaranteed Lease Revenue Bonds, County
Correctional Facility Project, Series 2000, 6.000%, 10/01/25
(Pre-refunded to 10/01/10) - FGIC Insured
5,315 New Jersey Housing and Mortgage Finance Agency, 10/07 at 101.50 AAA 5,517,980
Home Buyer Program Revenue Bonds, Series 1997U,
5.850%, 4/01/29 (Alternative Minimum Tax) - MBIA Insured
New Jersey Transportation Trust Fund Authority, Transportation
System Bonds, Series 2003C:
5,000 5.500%, 6/15/19 6/13 at 100.00 A+ 5,575,250
5,410 5.500%, 6/15/20 6/13 at 100.00 A+ 6,011,538
9,250 5.500%, 6/15/23 6/13 at 100.00 A+ 10,143,920
18
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
NEW JERSEY (continued)
New Jersey Turnpike Authority, Revenue Bonds, Series 2000A:
$ 3,915 6.000%, 1/01/14 No Opt. Call AAA $ 4,699,135
7,585 6.000%, 1/01/14 - MBIA Insured No Opt. Call AAA 9,058,083
------------------------------------------------------------------------------------------------------------------------------------
NEW MEXICO - 0.9% (0.6% OF TOTAL INVESTMENTS)
1,385 New Mexico Mortgage Finance Authority, Single Family 3/10 at 102.50 AAA 1,501,575
Mortgage Program Bonds, Series 2000D-2, 6.850%, 9/01/31
(Alternative Minimum Tax)
5,585 Santa Fe County, New Mexico, Correctional System Gross No Opt. Call AAA 6,800,296
Receipts Tax Revenue Bonds, Series 1997,
6.000%, 2/01/27 - FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK - 15.9% (10.3% OF TOTAL INVESTMENTS)
8,850 Erie County Tobacco Asset Securitization Corporation, 7/10 at 101.00 BBB 8,620,962
New York, Senior Tobacco Settlement Asset-Backed
Bonds, Series 2000, 6.250%, 7/15/40
14,580 Long Island Power Authority, New York, Electric System 6/08 at 101.00 A- 15,155,181
General Revenue Bonds, Series 1998A, 5.250%, 12/01/26
3,000 Metropolitan Transportation Authority, New York, 11/12 at 100.00 AAA 3,226,950
Transportation Revenue Refunding Bonds, Series 2002A,
5.125%, 11/15/21 - FGIC Insured
2,000 New York Counties Tobacco Trust I, Tobacco Settlement 6/10 at 101.00 BBB 2,015,260
Pass-Through Bonds, Series 2000, 6.500%, 6/01/35
New York City, New York, General Obligation Bonds,
Fiscal Series 1997G:
1,685 6.000%, 10/15/26 (Pre-refunded to 10/15/07) 10/07 at 101.00 Aaa 1,892,525
4,315 6.000%, 10/15/26 10/07 at 101.00 A 4,726,090
8,270 New York City, New York, General Obligation Bonds, No Opt. Call A 9,121,148
Fiscal Series 2004G, 5.000%, 8/01/14
5,000 New York City, New York, General Obligation Bonds, 6/13 at 100.00 A 5,447,500
Fiscal Series 2003J, 5.500%, 6/01/23
New York City, New York, General Obligation Bonds,
Fiscal Series 1996G:
755 5.750%, 2/01/07 (Pre-refunded to 2/01/06) 2/06 at 101.50 A*** 803,547
9,245 5.750%, 2/01/07 2/06 at 101.50 A 9,783,891
12,500 New York City, New York, General Obligation Bonds, 10/13 at 100.00 A 13,332,000
Fiscal Series 2003D, 5.250%, 10/15/22
6,000 New York City, New York, General Obligation Bonds, 8/14 at 100.00 A 6,498,720
Fiscal Series 2004C, 5.250%, 8/15/20
New York City Municipal Water Finance Authority, New York, Water
and Sewerage System Revenue Bonds, Fiscal Series 1996B:
2,000 5.750%, 6/15/26 (Pre-refunded to 6/15/06) - MBIA Insured 6/06 at 101.00 AAA 2,145,940
10,370 5.750%, 6/15/26 - MBIA Insured 6/06 at 101.00 AAA 11,082,938
New York City Industrial Development Agency, New York, Civic
Facility Revenue Bonds, United Jewish Appeal - Federation of
Jewish Philanthropies of New York Inc., Series 2004A:
2,185 5.250%, 7/01/20 7/14 at 100.00 Aa2 2,410,470
2,050 5.250%, 7/01/21 7/14 at 100.00 Aa2 2,252,889
2,420 5.250%, 7/01/22 4/14 at 100.00 Aa2 2,645,278
1,370 5.250%, 7/01/24 4/14 at 100.00 Aa2 1,481,600
Dormitory Authority of the State of New York, Revenue Bonds,
University of Rochester, Series 2004A:
1,025 5.250%, 7/01/20 7/14 at 100.00 A+ 1,120,417
1,000 5.250%, 7/01/22 7/14 at 100.00 A+ 1,083,110
500 5.250%, 7/01/24 7/14 at 100.00 A+ 535,800
Dormitory Authority of the State of New York, Revenue Bonds,
Department of Health, Series 1996:
1,160 5.500%, 7/01/25 (Pre-refunded to 7/01/06) - MBIA Insured 7/06 at 102.00 AAA 1,252,974
840 5.500%, 7/01/25 - MBIA Insured 7/06 at 102.00 AAA 894,734
1,995 Dormitory Authority of the State of New York, State and 7/14 at 100.00 AA- 2,159,149
Local Appropriation Lease Bonds, Upstate Community
Colleges, Series 2004B, 5.250%, 7/01/20
3,080 New York State Medical Care Facilities Finance Agency, 2/05 at 101.00 AAA 3,197,471
FHA-Insured Hospital and Nursing Home Mortgage Revenue
Bonds, Series 1993B, 5.500%, 2/15/22
14,000 New York State Urban Development Corporation, Service No Opt. Call AA- 15,644,440
Contract Revenue Bonds, Correctional and Youth Facilities,
Series 2002A, 5.500%, 1/01/17 (Mandatory put 1/01/11)
19
Nuveen Premium Income Municipal Fund, Inc. (NPI) (continued)
Portfolio of INVESTMENTS October 31, 2004
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK (continued)
New York City Sales Tax Asset Receivable Corporation, New York,
Local Government Assistance Corporation Dedicated Revenue Bonds,
Series 2004A:
$ 4,825 5.000%, 10/15/24 (WI, settling 11/04/04) - MBIA Insured 10/14 at 100.00 AAA $ 5,118,312
1,665 5.000%, 10/15/25 (WI, settling 11/04/04) - MBIA Insured 10/14 at 100.00 AAA 1,755,143
7,400 New York State Tobacco Settlement Financing Corporation, 6/10 at 100.00 AA- 8,072,586
Tobacco Settlement Asset-Backed and State Contingency
Contract-Backed Bonds, Series 2003A-1, 5.500%, 6/01/16
9,515 Triborough Bridge and Tunnel Authority, New York, 11/12 at 100.00 AA- 10,059,829
General Purpose Revenue Refunding Bonds, Series 2002B,
5.000%, 11/15/22
------------------------------------------------------------------------------------------------------------------------------------
NORTH CAROLINA - 1.0% (0.7% OF TOTAL INVESTMENTS)
Charlotte, North Carolina, Certificates of Participation,
Governmental Facilities Projects, Series 2003G:
5,785 5.250%, 6/01/22 6/13 at 100.00 AA+ 6,225,470
3,475 5.250%, 6/01/23 6/13 at 100.00 AA+ 3,721,447
------------------------------------------------------------------------------------------------------------------------------------
NORTH DAKOTA - 1.2% (0.8% OF TOTAL INVESTMENTS)
9,650 Dickinson, North Dakota, Health Care Facilities Revenue 2/10 at 102.00 AA 11,598,142
Bonds, BHS Long Term Care Inc., Series 1990,
7.625%, 2/15/20 - RAAI Insured
------------------------------------------------------------------------------------------------------------------------------------
OHIO - 1.8% (1.2% OF TOTAL INVESTMENTS)
4,265 Franklin County, Ohio, Hospital Revenue and Improvement 5/11 at 101.00 Aaa 4,547,599
Bonds, Children's Hospital Project, Series 2001,
5.500%, 5/01/28 - AMBAC Insured
2,720 Ohio State University, General Receipts Bonds, 6/13 at 100.00 AA 2,972,226
Series 2003B, 5.250%, 6/01/20
2,000 Richland County, Ohio, Hospital Facilities Revenue Refunding 11/10 at 101.00 A- 2,187,340
Bonds, MedCentral Health System Obligated Group,
Series 2000A, 6.125%, 11/15/16
7,000 Steubenville, Ohio, Hospital Facilities Revenue Refunding 10/10 at 100.00 A3 7,612,430
and Improvement Bonds, Trinity Health System, Series 2000,
6.500%, 10/01/30
------------------------------------------------------------------------------------------------------------------------------------
OREGON - 0.3% (0.2% OF TOTAL INVESTMENTS)
2,500 Oregon State Department of Transportation, Highway User 11/14 at 100.00 AA+ 2,695,425
Tax Revenue Bonds, Series 2004A, 5.000%, 11/15/21
------------------------------------------------------------------------------------------------------------------------------------
PENNSYLVANIA - 4.3% (2.8% OF TOTAL INVESTMENTS)
Lancaster Higher Education Authority, Pennsylvania,
Revenue Bonds, Franklin and Marshall College, Series 2003C:
1,340 5.250%, 4/15/15 4/13 at 100.00 A+ 1,483,527
1,960 5.250%, 4/15/17 4/13 at 100.00 A+ 2,141,712
Philadelphia Gas Works, Pennsylvania, Revenue Bonds,
General Ordinance, Fifth Series 2004A-1:
4,505 5.000%, 9/01/21 - FSA Insured 9/14 at 100.00 AAA 4,798,366
4,735 5.000%, 9/01/22 - FSA Insured 9/14 at 100.00 AAA 5,011,997
8,405 Philadelphia Redevelopment Authority, Pennsylvania, 4/08 at 103.00 N/R 7,633,001
Multifamily Housing Mortgage Revenue Bonds, Cricket
Court Apartments, Series 1998A, 6.200%, 4/01/25
(Alternative Minimum Tax)
5,295 Philadelphia School District, Pennsylvania, General 9/05 at 101.00 AAA 5,512,042
Obligation Bonds, Series 1995B, 5.500%, 9/01/25
(Pre-refunded to 9/01/05) - AMBAC Insured
14,000 State Public School Building Authority, Pennsylvania, 6/13 at 100.00 AAA 15,013,740
Lease Revenue Bonds, Philadelphia School District Project,
Series 2003, 5.250%, 6/01/24 - FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
PUERTO RICO - 0.6% (0.4% OF TOTAL INVESTMENTS)
5,770 Puerto Rico Electric Power Authority, Power Revenue 7/05 at 100.00 A-*** 5,914,019
Bonds, Series 1995X, 5.500%, 7/01/25 (Pre-refunded
to 7/01/05)
------------------------------------------------------------------------------------------------------------------------------------
RHODE ISLAND - 0.2% (0.1% OF TOTAL INVESTMENTS)
1,380 Providence Redevelopment Agency, Rhode Island, Revenue 4/10 at 101.00 Aaa 1,561,001
Bonds, Public Safety and Municipal Building Projects,
Series 1999A, 5.625%, 4/01/15 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
SOUTH CAROLINA - 5.4% (3.5% OF TOTAL INVESTMENTS)
8,610 Dorchester County School District 2, South Carolina, 12/14 at 100.00 A 9,043,083
Installment Purchase Revenue Bonds, GROWTH,
Series 2004, 5.250%, 12/01/24
20
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
SOUTH CAROLINA (continued)
Greenville County School District, South Carolina, Installment
Purchase Revenue Bonds, Series 2003:
$ 5,090 5.250%, 12/01/18 12/13 at 100.00 AA- $ 5,506,158
3,595 5.250%, 12/01/20 12/13 at 100.00 AA- 3,849,562
1,865 5.250%, 12/01/21 12/13 at 100.00 AA- 1,985,498
Lexington County Health Service District, South Carolina,
Hospital Revenue Bonds, Series 2004:
1,805 6.000%, 5/01/19 5/14 at 100.00 A 2,016,221
2,400 5.500%, 5/01/24 5/14 at 100.00 A 2,516,184
15,000 South Carolina JOBS Economic Development Authority, 8/13 at 100.00 BBB 16,045,950
Hospital Refunding and Improvement Revenue Bonds,
Palmetto Health Alliance, Series 2003C, 6.375%, 8/01/34
Tobacco Settlement Revenue Management Authority, South Carolina,
Tobacco Settlement Asset-Backed Bonds, Series 2001B:
7,500 6.375%, 5/15/28 5/11 at 101.00 BBB 7,115,400
4,150 6.375%, 5/15/30 No Opt. Call BBB 3,873,444
------------------------------------------------------------------------------------------------------------------------------------
SOUTH DAKOTA - 0.2% (0.1% OF TOTAL INVESTMENTS)
2,045 South Dakota State University, Revenue Bonds, Housing 4/14 at 100.00 AAA 2,203,324
and Auxiliary Facilities, Series 2004, 5.000%, 4/01/20 -
MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
TENNESSEE - 0.4% (0.3% OF TOTAL INVESTMENTS)
4,000 Tennessee Housing Development Agency, Homeownership 7/13 at 100.00 AA 4,226,760
Program Bonds, Series 2004, 5.000%, 7/01/34 (Alternative
Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
TEXAS - 13.1% (8.6% OF TOTAL INVESTMENTS)
10,205 Alliance Airport Authority, Texas, Special Facilities Revenue 12/04 at 100.00 CCC 6,547,528
Bonds, American Airlines Inc., Series 1990,
7.500%, 12/01/29 (Alternative Minimum Tax)
3,289 Austin Housing Finance Corporation, Texas, GNMA 12/10 at 105.00 Aaa 3,711,242
Collateralized Multifamily Housing Revenue Bonds,
Fairway Village Project, Series 2000A, 7.375%, 6/20/35
(Alternative Minimum Tax)
2,150 Brazos River Authority, Texas, Pollution Control Revenue 10/13 at 101.00 BBB 2,298,974
Bonds, TXU Energy Company LLC, Series 2003C,
6.750%, 10/01/38 (Alternative Minimum Tax)
Clear Creek Independent School District, Galveston and Harris
Counties, Texas, Unlimited Tax Schoolhouse and Refunding Bonds,
Series 2000:
4,850 6.000%, 2/15/16 (Pre-refunded to 2/15/10) 2/10 at 100.00 AAA 5,600,780
175 6.000%, 2/15/16 2/10 at 100.00 AAA 198,909
865 Harlingen Housing Finance Corporation, Texas, GNMA/FNMA 9/10 at 105.00 AAA 921,528
Single Family Mortgage Revenue Bonds, Series 2000A,
6.700%, 9/01/33 (Alternative Minimum Tax)
4,000 Harris County-Houston Sports Authority, Texas, Junior Lien 11/11 at 100.00 AAA 4,125,240
Revenue Refunding Bonds, Series 2001B,
5.250%, 11/15/40 - MBIA Insured
Harris County Hospital District, Texas, Revenue Refunding
Bonds, Series 1990:
3,460 7.400%, 2/15/10 - AMBAC Insured No Opt. Call AAA 3,772,265
5,940 7.400%, 2/15/10 - AMBAC Insured No Opt. Call AAA 6,745,345
19,125 Harris County Hospital District, Texas, Revenue Refunding 8/10 at 100.00 AAA 21,767,693
Bonds, Series 2000, 6.000%, 2/15/15 - MBIA Insured
6,000 Houston, Texas, General Obligation Public Improvement 3/11 at 100.00 AAA 6,705,540
Bonds, Series 2001B, 5.500%, 3/01/15 - FSA Insured
9,250 Houston, Texas, Subordinate Lien Airport System Revenue 7/10 at 100.00 AAA 10,022,468
Bonds, Series 2000B, 5.500%, 7/01/30 - FSA Insured
5,000 Houston, Texas, First Lien Combined Utility System Revenue 5/14 at 100.00 AAA 5,366,500
Bonds, Series 2004A, 5.250%, 5/15/25 - MBIA Insured
3,400 Lower Colorado River Authority, Texas, Revenue Refunding 5/13 at 100.00 AAA 3,635,144
and Improvement Bonds, Series 2003, 5.250%, 5/15/24 -
AMBAC Insured
1,505 Lower Colorado River Authority, Texas, Contract Revenue 5/13 at 100.00 AAA 1,614,654
Refunding Bonds, Transmission Services Corporation,
Series 2003C, 5.250%, 5/15/23 - AMBAC Insured
4,000 Tarrant County Health Facilities Development Corporation, 11/10 at 101.00 A 4,374,200
Texas, Hospital Revenue Bonds, Adventist Health System -
Sunbelt Obligated Group, Series 2000, 6.700%, 11/15/30
21
Nuveen Premium Income Municipal Fund, Inc. (NPI) (continued)
Portfolio of INVESTMENTS October 31, 2004
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
TEXAS (continued)
$ 12,020 Tarrant County Health Facilities Development Corporation, 12/10 at 105.00 Aaa $ 13,865,431
Texas, GNMA Collateralized Mortgage Loan Revenue
Bonds, Eastview Nursing Home, Ebony Lake Nursing
Center, Ft. Stockton Nursing Center, Lynnhaven Nursing
Center and Mission Oaks Manor, Series 2000A-1,
7.625%, 12/20/32
5,000 Tarrant Regional Water District, Texas, Water Revenue 3/13 at 100.00 AAA 5,508,100
Refunding and Improvement Bonds, Series 1999,
5.250%, 3/01/17 - FSA Insured
10,000 Texas A & M University, Financing System Revenue Bonds, 5/09 at 100.00 AAA 10,846,400
Series 1999, 5.550%, 5/15/29 - MBIA Insured
25,000 Texas Turnpike Authority, First Tier Revenue Bonds, No Opt. Call AAA 9,279,500
Central Texas Turnpike System, Series 2002A,
0.000%, 8/15/24 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
UTAH - 0.2% (0.2% OF TOTAL INVESTMENTS)
2,305 Utah Housing Finance Agency, Single Family Mortgage 7/07 at 101.50 AAA 2,381,664
Bonds, Series 1997F, 5.750%, 7/01/28 (Alternative
Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
VERMONT - 0.2% (0.1% OF TOTAL INVESTMENTS)
1,645 Vermont Housing Finance Agency, Single Family Housing 6/07 at 101.50 AAA 1,703,496
Bonds, Series 1997-9, 5.900%, 5/01/29 (Alternative
Minimum Tax) - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
VIRGINIA - 0.5% (0.3% OF TOTAL INVESTMENTS)
4,870 Virginia Beach Development Authority, Virginia, 10/14 at 100.00 N/R 4,603,806
Multifamily Residential Rental Housing Revenue Bonds,
Mayfair Apartments I and II, Series 1999,
7.500%, 10/01/39 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
WASHINGTON - 7.9% (5.2% OF TOTAL INVESTMENTS)
Public Utility District 1, Chelan County, Washington, Revenue
Bonds, Chelan Hydro Consolidated System, Series 1997A:
11,820 5.650%, 7/01/32 (Alternative Minimum Tax) 7/07 at 102.00 AA 12,221,644
(Optional put 7/01/09) (Mandatory put 7/01/24)
8,000 5.650%, 7/01/32 (Alternative Minimum Tax) 7/07 at 102.00 AA 8,245,600
(Optional put 7/01/09) (Mandatory put 7/01/27)
2,500 Energy Northwest, Washington, Electric Revenue Refunding 7/12 at 100.00 AAA 2,870,050
Bonds, Columbia Generating Station, Series 2002C,
5.750%, 7/01/17 - MBIA Insured
3,125 Skagit County Public Hospital District 1, Washington, 6/14 at 100.00 Aaa 3,471,875
Revenue Bonds, Skagit Valley Hospital, Series 2004A,
5.375%, 12/01/20 - MBIA Insured
5,000 Snohomish County, Washington, Limited Tax General 12/11 at 100.00 AAA 5,289,300
Obligation Bonds, Series 2001, 5.250%, 12/01/26 -
MBIA Insured
4,750 Washington State Healthcare Facilities Authority, Revenue 11/08 at 101.00 Aaa 5,015,098
Bonds, Swedish Health Services, Series 1998,
5.125%, 11/15/22 - AMBAC Insured
14,500 Washington Public Power Supply System, Revenue 7/08 at 102.00 Aaa 15,762,805
Refunding Bonds, Nuclear Project 2, Series 1998A,
5.000%, 7/01/12
Washington Public Power Supply System, Revenue Refunding Bonds,
Nuclear Project 3, Series 1997A:
5,220 5.250%, 7/01/14 - FSA Insured 7/07 at 102.00 AAA 5,697,056
9,350 5.250%, 7/01/15 7/07 at 102.00 Aaa 9,880,893
7,775 Washington Public Power Supply System, Revenue Refunding 7/08 at 102.00 Aaa 8,220,119
Bonds, Nuclear Project 3, Series 1998A, 5.125%, 7/01/18
------------------------------------------------------------------------------------------------------------------------------------
WISCONSIN - 2.8% (1.8% OF TOTAL INVESTMENTS)
Milwaukee Redevelopment Authority, Wisconsin, Lease
Revenue Bonds, Public Schools, Series 2003A:
1,000 5.125%, 8/01/22 - AMBAC Insured 8/13 at 100.00 AAA 1,066,890
1,345 5.125%, 8/01/23 8/13 at 100.00 AAA 1,425,861
Wisconsin, General Obligation Bonds, Series 2004-3:
1,720 5.250%, 5/01/19 - FGIC Insured 5/14 at 100.00 AAA 1,903,679
1,265 5.250%, 5/01/21 - FGIC Insured 5/14 at 100.00 AAA 1,385,352
1,000 Wisconsin Health and Educational Facilities Authority, 7/11 at 100.00 A- 1,066,270
Revenue Bonds, Agnesian Healthcare Inc., Series 2001,
6.000%, 7/01/21
2,175 Wisconsin Health and Educational Facilities Authority, 10/11 at 100.00 BBB 2,282,228
Revenue Bonds, Carroll College Inc., Series 2001,
6.125%, 10/01/16
22
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
WISCONSIN (continued)
$ 2,000 Wisconsin Health and Educational Facilities Authority, 8/13 at 100.00 A $ 2,036,360
Revenue Bonds, Wheaton Franciscan Services Inc.,
Series 2003A, 5.250%, 8/15/25
9,000 Wisconsin Health and Educational Facilities Authority, 4/13 at 100.00 BBB+ 9,590,130
Revenue Bonds, Aurora Health Care Inc., Series 2003,
6.400%, 4/15/33
6,025 Wisconsin Health and Educational Facilities Authority, 9/13 at 100.00 A- 6,377,932
Revenue Bonds, Franciscan Sisters of Christian Charity
Healthcare Ministry, Series 2003A, 6.000%, 9/01/22
------------------------------------------------------------------------------------------------------------------------------------
$ 1,477,320 Total Long-Term Investments (cost $1,394,994,020) - 152.1% 1,475,006,411
=============-----------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 2.0% 19,532,346
--------------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (54.1)% (525,000,000)
--------------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 969,538,757
====================================================================================================================
(1) All percentages shown in the Portfolio of Investments
are based on net assets applicable to Common shares
unless otherwise noted.
* Optional Call Provisions (not covered by the report of
independent registered public accounting firm): Dates
(month and year) and prices of the earliest optional
call or redemption. There may be other call provisions
at varying prices at later dates.
** Ratings (not covered by the report of independent
registered public accounting firm): Using the higher of
Standard & Poor's or Moody's rating.
*** Securities are backed by an escrow or trust containing
sufficient U.S. Government or U.S. Government agency
securities which ensures the timely payment of
principal and interest. Such securities are normally
considered to be equivalent to AAA rated securities.
N/R Investment is not rated.
(WI) Security purchased on a when-issued basis.
# On December 9, 2002, UALCorporation, the holding
company of United Air Lines, Inc., filed for federal
bankruptcy protection. The Adviser determined that it
was likely United would not remain current on their
interest payment obligations with respect to these
bonds and thus has stopped accruing interest.
See accompanying notes to financial statements.
23
Nuveen Premium Income Municipal Fund 2, Inc. (NPM)
Portfolio of
INVESTMENTS October 31, 2004
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
ALABAMA - 1.4% (0.9% OF TOTAL INVESTMENTS)
$ 8,255 University of South Alabama, Student Tuition Revenue Bonds, 3/14 at 100.00 Aaa $ 8,693,423
Series 2004, 5.000%, 3/15/24 - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
ARIZONA - 1.0% (0.7% OF TOTAL INVESTMENTS)
2,850 Maricopa County Industrial Development Authority, Arizona, 1/07 at 102.00 AAA 3,249,513
Multifamily Housing Revenue Bonds, Place Five and
The Greenery Apartments, Series 1996A, 6.625%, 1/01/27
2,945 Pima County Industrial Development Authority, Arizona, 1/05 at 101.50 AAA 3,110,804
Lease Obligation Revenue Refunding Bonds, Tucson
Electric Power Company, Series 1988A, 7.250%, 7/15/10 -
FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA - 10.4% (6.9% OF TOTAL INVESTMENTS)
California Educational Facilities Authority, Revenue Refunding
Bonds, Loyola Marymount University, Series 2001A:
3,255 0.000%, 10/01/23 - MBIA Insured No Opt. Call Aaa 1,279,703
5,890 0.000%, 10/01/24 - MBIA Insured No Opt. Call Aaa 2,161,807
7,615 0.000%, 10/01/25 - MBIA Insured No Opt. Call Aaa 2,620,093
California, General Obligation Bonds, Series 2004:
5,000 5.000%, 4/01/10 No Opt. Call A 5,490,300
8,000 5.125%, 2/01/25 2/14 at 100.00 A 8,396,160
5,690 California Department of Veterans Affairs, Home Purchase 6/12 at 101.00 AAA 6,111,401
Revenue Bonds, Series 2002A, 5.300%, 12/01/21 -
AMBAC Insured
California Department of Water Resources, Power Supply
Revenue Bonds, Series 2002A:
4,000 6.000%, 5/01/15 5/12 at 101.00 A2 4,682,720
5,500 5.375%, 5/01/21 5/12 at 101.00 A2 5,978,500
2,500 California, Economic Recovery Revenue Bonds, No Opt. Call AA- 2,855,125
Series 2004A, 5.250%, 7/01/14
1,900 Chula Vista, California, Industrial Development Revenue 6/14 at 102.00 A2 2,037,636
Bonds, San Diego Gas and Electric Company, Series 1996A,
5.300%, 7/01/21
30,000 Foothill/Eastern Transportation Corridor Agency, California, No Opt. Call AAA 14,457,900
Toll Road Revenue Bonds, Series 1995A, 0.000%, 1/01/21
2,220 San Diego Redevelopment Agency, California, Subordinate 9/14 at 100.00 AAA 2,383,103
Lien Tax Allocation Bonds, Centre City Project, Series 2004A,
5.000%, 9/01/20 - XLCA Insured
960 San Francisco Redevelopment Agency, California, Hotel Tax 1/05 at 102.00 AAA 983,098
Revenue Bonds, Series 1994, 6.750%, 7/01/25 - FSA Insured
6,000 San Jose Redevelopment Agency, California, Tax Allocation 8/14 at 100.00 AAA 6,659,400
Bonds, Merged Area Redevelopment Project, Series 2004A,
5.250%, 8/01/19 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
COLORADO - 0.7% (0.5% OF TOTAL INVESTMENTS)
1,700 Centennial Water and Sanitation District, Colorado, Water 12/14 at 100.00 AAA 1,815,889
and Sewerage Revenue Bonds, Series 2004,
5.000%, 12/01/22 - FGIC Insured
350 Colorado Housing Finance Authority, Single Family Program 12/05 at 105.00 Aa2 351,859
Senior Bonds, Series 1995D, 7.375%, 6/01/26
(Alternative Minimum Tax)
400 Denver City and County, Colorado, Airport System Revenue No Opt. Call A 489,236
Bonds, Series 1991D, 7.750%, 11/15/13 (Alternative
Minimum Tax)
1,700 Denver City and County, Colorado, FHA-Insured Mortgage 10/07 at 102.00 AAA 1,756,066
Loan, Multifamily Housing Revenue Bonds, Boston Lofts
Project, Series 1997A, 5.750%, 10/01/27 (Alternative
Minimum Tax)
24
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
CONNECTICUT - 2.4% (1.6% OF TOTAL INVESTMENTS)
$ 3,170 Connecticut Housing Finance Authority, Housing Mortgage 5/06 at 102.00 AAA $ 3,325,584
Finance Program Bonds, Series 1996C-2, 6.250%, 11/15/18
Connecticut, Special Tax Obligation Transportation Infrastructure
Purpose Bonds, Series 2003B:
8,310 5.000%, 1/01/21 - FGIC Insured 1/14 at 100.00 AAA 8,945,632
3,000 5.000%, 1/01/24 - FGIC Insured 1/14 at 100.00 AAA 3,170,430
------------------------------------------------------------------------------------------------------------------------------------
DISTRICT OF COLUMBIA - 1.7% (1.1% OF TOTAL INVESTMENTS)
District of Columbia, Revenue Bonds, Georgetown University,
Series 2001A:
11,720 0.000%, 4/01/27 - MBIA Insured 4/11 at 39.61 AAA 3,281,014
13,780 0.000%, 4/01/28 - MBIA Insured 4/11 at 37.21 AAA 3,616,699
15,855 0.000%, 4/01/29 - MBIA Insured 4/11 at 35.07 AAA 3,902,550
------------------------------------------------------------------------------------------------------------------------------------
FLORIDA - 2.3% (1.5% OF TOTAL INVESTMENTS)
1,700 Miami-Dade County, Florida, Beacon Tradeport Community 5/12 at 102.00 AA 1,832,957
Development District, Special Assessment Bonds,
Commercial Project, Series 2002A, 5.625%, 5/01/32 -
RAAI Insured
5,000 Dade County, Florida, Aviation Revenue Bonds, Series 1996A, 10/06 at 102.00 AAA 5,331,250
5.750%, 10/01/18 (Alternative Minimum Tax) - MBIA Insured
2,500 Escambia County Health Facilities Authority, Florida, Health 10/08 at 101.00 A3 2,529,150
Facility Revenue Refunding Bonds, Baptist Hospital and
Baptist Manor, Series 1998, 5.125%, 10/01/19
920 Florida Housing Finance Corporation, Homeowner Mortgage 1/10 at 100.00 AAA 972,026
Revenue Bonds, Series 2000-11, 5.850%, 1/01/22
(Alternative Minimum Tax) - FSA Insured
3,600 Hillsborough County Industrial Development Authority, 4/10 at 101.00 N/R 3,940,128
Florida, Exempt Facilities Revenue Bonds, National Gypsum
Company Apollo Beach Project, Series 2000B,
7.125%, 4/01/30 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
GEORGIA - 1.3% (0.9% OF TOTAL INVESTMENTS)
500 Chatham County Hospital Authority, Savannah, Georgia, 1/14 at 100.00 A- 516,780
Hospital Revenue Bonds, Memorial Health University
Medical Center Inc., Series 2004A, 5.375%, 1/01/26
215 Fulton County Housing Authority, Georgia, GNMA 9/06 at 102.00 AAA 223,400
Mortgage-Backed Securities Program Single Family
Mortgage Revenue Refunding Bonds, Series 1996A,
6.200%, 9/01/27 (Alternative Minimum Tax)
Municipal Electric Authority of Georgia, Combustion Turbine
Revenue Bonds, Series 2003A:
3,415 5.250%, 11/01/15 - MBIA Insured 11/13 at 100.00 AAA 3,832,552
3,365 5.000%, 11/01/18 - MBIA Insured 11/13 at 100.00 AAA 3,647,828
------------------------------------------------------------------------------------------------------------------------------------
IDAHO - 1.6% (1.1% OF TOTAL INVESTMENTS)
630 Idaho Housing Agency, Senior Lien Single Family Mortgage 7/05 at 102.00 Aaa 633,572
Bonds, Series 1995F, 6.450%, 7/01/27 (Alternative
Minimum Tax)
3,210 Idaho Housing Agency, FHA-Insured Mortgage Revenue 6/05 at 102.00 Aa2 3,292,561
Bonds, Park Place Project, Series 1995A, 6.500%, 12/01/36
(Alternative Minimum Tax)
3,160 Idaho Housing and Finance Association, GNMA Housing 3/12 at 105.00 Aaa 3,615,577
Revenue Refunding Bonds, Wedgewood Terrace Project,
Series 2002A-1, 7.250%, 3/20/37
675 Idaho Housing and Finance Association, Single Family 7/06 at 102.00 Aaa 700,697
Mortgage Bonds, Series 1996G, 6.350%, 7/01/26
(Alternative Minimum Tax)
980 Idaho Housing and Finance Association, Single Family 1/10 at 100.00 Aa2 1,044,092
Mortgage Bonds, Series 2000B, 6.250%, 7/01/22
(Alternative Minimum Tax)
1,005 Idaho Housing and Finance Association, Single Family 7/10 at 100.00 Aaa 1,010,608
Mortgage Bonds, Series 2000E, 5.950%, 7/01/20
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS - 17.3% (11.5% OF TOTAL INVESTMENTS)
11,200 Chicago, Illinois, General Obligation Bonds, Series 1995A-1, 1/06 at 102.00 AAA 11,683,728
5.125%, 1/01/25 - AMBAC Insured
1,000 Chicago, Illinois, General Obligation Refunding Bonds, 7/08 at 102.00 AAA 1,092,630
Series 1998, 5.250%, 1/01/20 - FGIC Insured
22,670 Chicago, Illinois, General Obligation Bonds, City Colleges No Opt. Call AAA 8,200,419
of Chicago Capital Improvement Project, Series 1999,
0.000%, 1/01/25 - FGIC Insured
5,000 Chicago Board of Education, Illinois, Unlimited Tax General No Opt. Call AAA 2,349,400
Obligation Bonds, Dedicated Tax Revenues, Series 1999A,
0.000%, 12/01/20 - FGIC Insured
25
Nuveen Premium Income Municipal Fund 2, Inc. (NPM) (continued)
Portfolio of INVESTMENTS October 31, 2004
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS (continued)
$ 1,175 Chicago, Illinois, GNMA Collateralized Multifamily Housing 6/09 at 102.00 Aaa $ 1,231,518
Revenue Bonds, Bryn Mawr-Belle Shores Project,
Series 1997, 5.800%, 6/01/23 (Alternative Minimum Tax)
3,705 Chicago, Illinois, Tax Increment Allocation Bonds, 1/07 at 102.00 N/R 3,839,454
Read-Dunning Redevelopment Project, Series 1996B,
7.250%, 1/01/14
3,530 Chicago, Illinois, Tax Increment Allocation Bonds, Sanitary 1/07 at 102.00 N/R 3,688,885
Drainage and Ship Canal Redevelopment Project,
Series 1997A, 7.750%, 1/01/14
4,865 Cook County Community Consolidated School District 15, No Opt. Call Aaa 2,285,966
Palatine, Illinois, General Obligation Bonds, Series 2001,
0.000%, 12/01/20 - FGIC Insured
6,190 Cook County Community High School District 219, No Opt. Call Aaa 2,908,557
Niles Township, Illinois, General Obligation Capital
Appreciation Bonds, Series 2001, 0.000%, 12/01/20 -
MBIA Insured
2,665 DuPage County Forest Preserve District, Illinois, General No Opt. Call AAA 3,047,481
Obligation Bonds, Series 2003, 5.250%, 10/01/15
2,850 East Saint Louis, Illinois, FHA-Insured Section 8 Assisted 1/05 at 101.00 AAA 2,881,065
Mortgage Revenue Refunding Bonds, Dawson Manor
Apartments, Series 1994A, 6.500%, 7/01/24 - MBIA Insured
Illinois Finance Authority, Revenue Bonds, OSF Healthcare
System, Series 2004:
2,000 5.250%, 11/15/14 5/14 at 100.00 A 2,173,540
4,420 5.250%, 11/15/15 5/14 at 100.00 A 4,770,197
Illinois Finance Authority, Revenue Bonds, University of
Chicago, Series 2004A:
1,000 5.000%, 7/01/24 (WI, settling 11/10/04) 7/14 at 100.00 Aa1 1,048,800
1,000 5.000%, 7/01/25 (WI, settling 11/10/04) 7/14 at 100.00 Aa1 1,042,390
3,000 Illinois Health Facilities Authority, Revenue Refunding Bonds, No Opt. Call A+ 3,480,870
Lutheran General Health System, Series 1993C,
6.000%, 4/01/18
3,000 Illinois Health Facilities Authority, Revenue Bonds, Lake 7/13 at 100.00 A- 3,192,480
Forest Hospital, Series 2003, 6.000%, 7/01/33
Illinois Housing Development Authority, Housing Finance
Bonds, Series 2000A:
855 5.750%, 9/01/10 (Alternative Minimum Tax) 3/10 at 100.00 AA 899,161
1,245 6.200%, 9/01/20 (Alternative Minimum Tax) 3/10 at 100.00 AA 1,296,929
11,000 Illinois, General Obligation Bonds, Illinois FIRST Program, No Opt. Call AAA 13,385,570
Series 2001, 6.000%, 11/01/26 - FGIC Insured
Illinois, General Obligation Bonds, Illinois FIRST Program,
Series 2002:
9,000 5.250%, 8/01/12 - MBIA Insured No Opt. Call AAA 10,209,600
2,000 5.500%, 2/01/18 - FGIC Insured 2/12 at 100.00 AAA 2,258,340
4,020 Lake, Cook, Kane and McHenry Counties Community Unit No Opt. Call AAA 4,609,252
School District 220, Barrington, Illinois, School Refunding
Bonds, Series 2002, 5.250%, 12/01/20 - FSA Insured
Lake County Community Unit School District 60, Waukegan,
Illinois, General Obligation Refunding Bonds, Series 2001B:
3,230 0.000%, 11/01/19 - FSA Insured No Opt. Call Aaa 1,620,459
1,740 0.000%, 11/01/21 - FSA Insured No Opt. Call Aaa 772,804
17,945 McHenry and Kane Counties Community Consolidated No Opt. Call Aaa 7,801,589
School District 158, Huntley, Illinois, General Obligation
Bonds, Series 2003, 0.000%, 1/01/22 - FGIC Insured
4,505 McHenry County Community Consolidated School District 47, 2/09 at 100.00 Aaa 5,002,893
Crystal Lake, Illinois, General Obligation Refunding Bonds,
Series 1999, 5.750%, 2/01/19 - FSA Insured
2,910 McHenry County Community High School District 154, No Opt. Call Aaa 1,344,886
Marengo, Illinois, Capital Appreciation School Bonds,
Series 2001, 0.000%, 1/01/21 - FGIC Insured
2,540 Metropolitan Pier and Exposition Authority, Illinois, Revenue 6/12 at 101.00 AAA 2,607,539
Bonds, McCormick Place Expansion Project, Series 2002A,
5.000%, 12/15/28 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
INDIANA - 3.3% (2.2% OF TOTAL INVESTMENTS)
1,000 Ball State University, Indiana, Student Fee Revenue Bonds, 1/12 at 100.00 AAA 1,141,570
Series 2002K, 5.750%, 7/01/20 - FGIC Insured
6,031 Greenfield, Indiana, GNMA Multifamily Housing Revenue 12/05 at 105.00 Aaa 6,266,450
Bonds, Pedcor Investments Project, Series 1996A,
6.200%, 12/01/28 (Alternative Minimum Tax)
26
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
INDIANA (continued)
$ 2,875 Indiana Bond Bank, State Revolving Fund Program 2/05 at 102.00 AAA $ 2,969,013
Guarantee Revenue Bonds, Series 1995A, 6.750%, 2/01/17
(Pre-refunded to 2/01/05)
3,500 Indiana Bond Bank, Special Program Bonds, East Chicago 2/10 at 101.00 AAA 4,000,920
Facilities Building Corporation, Series 2000A,
6.125%, 2/01/25 - AMBAC Insured
Indiana Transportation Finance Authority, Highway
Revenue Bonds, Series 2000:
805 5.375%, 12/01/25 (Pre-refunded to 12/01/10) 12/10 at 100.00 Aa2*** 913,095
4,195 5.375%, 12/01/25 12/10 at 100.00 Aa2 4,540,584
1,000 Shelbyville Elementary School Building Corporation, 7/11 at 100.00 AAA 1,081,650
Shelby County, Indiana, First Mortgage Bonds, Series 2001,
5.000%, 7/05/18 - FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
IOWA - 1.9% (1.3% OF TOTAL INVESTMENTS)
8,000 Iowa Finance Authority, Hospital Facilities Revenue Bonds, 7/08 at 102.00 AAA 8,203,040
Iowa Health System, Series 1998A, 5.125%, 1/01/28 -
MBIA Insured
2,000 Iowa Finance Authority, Healthcare Revenue Bonds, 7/10 at 100.00 A1 2,167,620
Genesis Medical Center, Series 2000, 6.250%, 7/01/25
2,000 Iowa Tobacco Settlement Authority, Tobacco Settlement 6/11 at 101.00 BBB 1,694,500
Asset-Backed Revenue Bonds, Series 2001B,
5.300%, 6/01/25
------------------------------------------------------------------------------------------------------------------------------------
KANSAS - 0.0% (0.0% OF TOTAL INVESTMENTS)
275 Sedgwick and Shawnee Counties, Kansas, GNMA No Opt. Call Aaa 276,689
Collateralized Single Family Mortgage Revenue
Refunding Bonds, Series 1994A-1, 7.900%, 5/01/24
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
LOUISIANA - 2.5% (1.6% OF TOTAL INVESTMENTS)
1,000 Bossier Public Trust Financing Authority, Louisiana, 8/05 at 102.00 AAA 1,028,770
Single Family Mortgage Revenue Refunding Bonds,
Series 1995B, 6.125%, 8/01/28
4,045 East Baton Rouge Parish Mortgage Finance Authority, 10/05 at 102.00 Aaa 4,169,505
Louisiana, GNMA/FNMA Mortgage-Backed Securities
Program Single Family Mortgage Revenue Bonds,
Series 1994C, 6.350%, 10/01/28
(Alternative Minimum Tax)
3,230 Jefferson Sales Tax District, Jefferson Parish, Louisiana, 12/12 at 100.00 AAA 3,503,064
Special Sales Tax Revenue Refunding Bonds, Series 2002,
5.250%, 12/01/21 - AMBAC Insured
3,305 New Orleans Home Mortgage Authority, Louisiana, 6/05 at 102.00 Aaa 3,390,566
GNMA/FNMA Single Family Mortgage Revenue
Bonds, Series 1995A, 6.300%, 6/01/28 (Alternative
Minimum Tax)
3,460 Orleans Levee District, Louisiana, Levee District General 12/05 at 103.00 AAA 3,710,642
Obligation Bonds, Series 1986, 5.950%, 11/01/15 -
FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
MARYLAND - 0.2% (0.2% OF TOTAL INVESTMENTS)
1,390 Maryland Health and Higher Educational Facilities 7/14 at 100.00 A 1,498,642
Authority, Revenue Bonds, LifeBridge Health System,
Series 2004A, 5.250%, 7/01/19
------------------------------------------------------------------------------------------------------------------------------------
MASSACHUSETTS - 6.7% (4.4% OF TOTAL INVESTMENTS)
Massachusetts, General Obligation Bonds, Consolidated
Loan, Series 2002E:
11,400 5.250%, 1/01/21 (Pre-refunded to 1/01/13) - FSA Insured 1/13 at 100.00 AAA 12,854,184
1,850 5.250%, 1/01/21 (Pre-refunded to 1/01/13) - FSA Insured 1/13 at 100.00 AAA 2,085,986
1,000 Massachusetts Development Finance Authority, Revenue 10/14 at 100.00 BBB 1,036,680
Bonds, Hampshire College, Series 2004, 5.700%, 10/01/34
2,925 Massachusetts Development Finance Agency, Pioneer No Opt. Call N/R 3,204,396
Valley Resource Recovery Revenue Bonds, Eco/Springfield
LLC Project, Series 2000A, 8.375%, 7/01/14 (Alternative
Minimum Tax)
2,750 Massachusetts Health and Educational Facilities 5/12 at 100.00 AAA 2,848,643
Authority, Revenue Bonds, New England Medical
Center Hospitals, Series 2002H, 5.000%, 5/15/25 -
FGIC Insured
9,175 Massachusetts Health and Educational Facilities Authority, 10/11 at 101.00 AA 9,970,564
Revenue Bonds, Berkshire Health System, Series 2001E,
5.700%, 10/01/25 - RAAI Insured
Massachusetts, Special Obligation Dedicated Tax Revenue
Bonds, Series 2004:
2,250 5.250%, 1/01/21 - FGIC Insured 1/14 at 100.00 AAA 2,459,520
4,000 5.250%, 1/01/24 - FGIC Insured 1/14 at 100.00 AAA 4,312,000
27
Nuveen Premium Income Municipal Fund 2, Inc. (NPM) (continued)
Portfolio of INVESTMENTS October 31, 2004
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
MASSACHUSETTS (continued)
$ 3,605 Massachusetts Water Resources Authority, General Revenue Bonds, 12/04 at 102.00 AAA $ 3,688,131
Series 1993C, 5.250%, 12/01/20 (Pre-refunded to 12/01/04) -
AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
MICHIGAN - 2.4% (1.6% OF TOTAL INVESTMENTS)
Grand Rapids and Kent County Joint Building Authority, Michigan,
Limited Tax General Obligation Bonds, Devos Place Project,
Series 2001:
7,660 0.000%, 12/01/21 No Opt. Call AAA 3,486,143
7,955 0.000%, 12/01/22 No Opt. Call AAA 3,402,910
8,260 0.000%, 12/01/23 No Opt. Call AAA 3,311,517
8,575 0.000%, 12/01/24 No Opt. Call AAA 3,214,082
2,000 Michigan State Hospital Finance Authority, Revenue 8/05 at 100.00 Ba3 1,949,560
Refunding Bonds, Detroit Medical Center Obligated
Group, Series 1993A, 6.375%, 8/15/09
------------------------------------------------------------------------------------------------------------------------------------
MINNESOTA - 5.2% (3.4% OF TOTAL INVESTMENTS)
6,995 Champlin, Minnesota, GNMA Guaranteed Senior 6/12 at 105.00 Aaa 7,087,124
Housing Revenue Bonds, Champlin Shores Senior
Living Center, Series 2002A, 3.000%, 12/20/43
6,250 Cohasset, Minnesota, Pollution Control Revenue Bonds, 7/14 at 100.00 A 6,392,875
Allete Inc., Series 2004, 4.950%, 7/01/22
Minneapolis-St. Paul Housing and Redevelopment
Authority, Minnesota, Revenue Bonds, HealthPartners
Inc., Series 2003:
1,000 6.000%, 12/01/18 12/13 at 100.00 BBB+ 1,077,950
1,050 5.875%, 12/01/29 12/13 at 100.00 BBB+ 1,083,495
3,000 Minneapolis-St. Paul Metropolitan Airports Commission, 1/11 at 100.00 AAA 3,177,210
Minnesota, Subordinate Airport Revenue Bonds,
Series 2001C, 5.250%, 1/01/26 - FGIC Insured
2,400 Minneapolis-St. Paul Metropolitan Airports Commission, 1/11 at 100.00 AAA 2,560,344
Minnesota, Airport Revenue Bonds, Series 2001A,
5.250%, 1/01/25 - FGIC Insured
1,000 Minnesota Municipal Power Agency, Electric Revenue 10/14 at 100.00 A3 1,086,990
Bonds, Series 2004A, 5.250%, 10/01/19
1,385 Minnesota Housing Finance Agency, Single Family Mortgage 7/09 at 100.00 AA+ 1,393,005
Bonds, Series 2000C, 6.100%, 7/01/30 (Alternative
Minimum Tax)
2,290 Minnesota Housing Finance Agency, Rental Housing Bonds, 2/05 at 102.00 AAA 2,344,181
Series 1995D, 5.950%, 2/01/18 - MBIA Insured
1,090 Minnesota Housing Finance Agency, Single Family Mortgage 1/06 at 102.00 AA+ 1,126,253
Bonds, Series 1996G, 6.250%, 7/01/26 (Alternative
Minimum Tax)
1,840 Minnesota Housing Finance Agency, Single Family Remarketed 1/11 at 101.00 AA+ 1,939,691
Mortgage Bonds, Series 1998H-2, 6.050%, 7/01/31
(Alternative Minimum Tax)
1,620 St. Louis Park, Minnesota, Revenue Bonds, Park Nicollet 7/14 at 100.00 A- 1,708,096
Health Services, Series 2003B, 5.500%, 7/01/25
2,000 Southern Minnesota Municipal Power Agency, Power Supply 1/05 at 100.00 Aaa 2,028,280
System Revenue Bonds, Series 1992B, 5.750%, 1/01/11
------------------------------------------------------------------------------------------------------------------------------------
MISSISSIPPI - 0.4% (0.3% OF TOTAL INVESTMENTS)
2,475 Mississippi Hospital Equipment and Facilities Authority, 9/14 at 100.00 N/R 2,495,518
Revenue Bonds, Baptist Memorial Health Care,
Series 2004B-1, 5.000%, 9/01/24
------------------------------------------------------------------------------------------------------------------------------------
MISSOURI - 6.3% (4.2% OF TOTAL INVESTMENTS)
2,000 Cole County Industrial Development Authority, Missouri, 2/14 at 100.00 N/R 2,044,560
Revenue Bonds, Lutheran Senior Services - Heisinger
Project, Series 2004, 5.250%, 2/01/24
9,000 Kansas City, Missouri, General Improvement Airport Revenue 9/12 at 100.00 AAA 9,952,200
Bonds, Series 2003B, 5.250%, 9/01/17 - FGIC Insured
6,445 Missouri, Water Pollution Control Revenue Refunding 10/12 at 100.00 AAA 7,043,354
Bonds, Series 2002B, 5.000%, 10/01/18
4,095 Missouri, General Obligation Refunding Bonds, Fourth State 10/12 at 100.00 AAA 4,475,180
Building, Series 2002A, 5.000%, 10/01/18
Missouri Health and Educational Facilities Authority, Revenue
Bonds, SSM Healthcare System, Series 2001A:
2,500 5.250%, 6/01/21 - AMBAC Insured 6/11 at 101.00 AAA 2,676,850
2,000 5.250%, 6/01/28 - AMBAC Insured 6/11 at 101.00 AAA 2,091,140
28
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
MISSOURI (continued)
$ 2,500 Missouri Health and Educational Facilities Authority, Revenue 5/13 at 100.00 AA $ 2,618,800
Bonds, BJC Health System, Series 2003, 5.125%, 5/15/24
1,200 Missouri Health and Educational Facilities Authority, Revenue 2/14 at 100.00 BBB+ 1,238,424
Bonds, Lake Regional Health System, Series 2003,
5.125%, 2/15/18
5,500 St. Louis County Industrial Development Authority, Missouri, 12/04 at 100.00 N/R 5,505,500
Revenue Bonds, Kiel Center Multipurpose Arena,
Series 1992, 7.625%, 12/01/09 (Alternative Minimum Tax)
2,200 St. Louis, Missouri, Airport Revenue Bonds, Airport 7/11 at 100.00 AAA 2,316,820
Development Program, Series 2001A, 5.125%, 7/01/22 -
MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
NEBRASKA - 0.2% (0.2% OF TOTAL INVESTMENTS)
1,470 Municipal Energy Agency of Nebraska, Power Supply System 4/13 at 100.00 AAA 1,583,352
Revenue Bonds, Series 2003A, 5.250%, 4/01/23 - FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
NEVADA - 5.5% (3.6% OF TOTAL INVESTMENTS)
4,000 Clark County, Nevada, Subordinate Lien Airport Revenue 7/14 at 100.00 AAA 4,219,440
Bonds, Series 2004A-2, 5.125%, 7/01/25 - FGIC Insured
5,795 Clark County, Nevada, Motor Vehicle Fuel Tax Highway 7/13 at 100.00 AAA 6,092,168
Improvement Revenue Bonds, Series 2003, 5.000%, 7/01/23 -
AMBAC Insured
4,000 Clark County, Nevada, Industrial Development Revenue Bonds, 12/04 at 100.00 AAA 4,138,320
Nevada Power Company Project, Series 1992A,
6.700%, 6/01/22 (Alternative Minimum Tax) - FGIC Insured
10,410 Clark County School District, Nevada, General Obligation 6/12 at 100.00 AAA 11,800,256
Bonds, Series 2002C, 5.500%, 6/15/18 - MBIA Insured
7,315 Washoe County School District, Nevada, General Obligation No Opt. Call AAA 8,585,908
Refunding Bonds, Series 2002B, 5.500%, 6/01/17 -
FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
NEW JERSEY - 3.5% (2.3% OF TOTAL INVESTMENTS)
5,615 Essex County Improvement Authority, New Jersey, Lease 12/13 at 100.00 Aaa 6,105,021
Revenue Bonds, Series 2003, 5.125%, 12/15/20 -
FSA Insured
4,310 New Jersey Housing and Mortgage Finance Agency, 11/07 at 101.50 AAA 4,522,699
Multifamily Housing Revenue Bonds, Series 1997A,
5.650%, 5/01/40 (Alternative Minimum Tax) - AMBAC Insured
3,400 New Jersey Transportation Trust Fund Authority, Transportation 6/13 at 100.00 A+ 3,746,698
System Bonds, Series 2003C, 5.500%, 6/15/22
3,000 New Jersey Turnpike Authority, Revenue Bonds, No Opt. Call A 3,450,030
Series 1991C, 6.500%, 1/01/09
1,000 Toms River Board of Education, Ocean County, New Jersey, 7/07 at 100.00 AAA 1,096,190
School District General Obligation Bonds, Series 1997,
5.750%, 7/15/21 (Pre-refunded to 7/15/07) - FGIC Insured
3,490 Union County Utilities Authority, New Jersey, Solid Waste 6/08 at 101.00 AAA 3,623,144
Facility Subordinate Lease Revenue Bonds, Ogden Martin
Systems of Union Inc., Series 1998A, 5.350%, 6/01/23
(Alternative Minimum Tax) - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
NEW MEXICO - 0.3% (0.2% OF TOTAL INVESTMENTS)
1,560 New Mexico Mortgage Finance Authority, Single Family 7/05 at 102.00 AAA 1,605,755
Mortgage Program Bonds, Series 1995E-2, 6.300%, 7/01/17
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK - 20.4% (13.6% OF TOTAL INVESTMENTS)
2,375 Long Island Power Authority, New York, Electric System 6/08 at 101.00 AAA 2,559,039
General Revenue Bonds, Series 1998A, 5.125%, 12/01/22 -
FSA Insured
New York City, New York, General Obligation Bonds, Fiscal
Series 1997I:
9,600 6.250%, 4/15/27 (Pre-refunded to 4/15/07) 4/07 at 101.00 Aaa 10,678,656
2,420 6.250%, 4/15/27 4/07 at 101.00 A 2,638,816
New York City, New York, General Obligation Bonds, Fiscal
Series 1996J:
8,680 5.875%, 2/15/19 (Pre-refunded to 2/15/06) 2/06 at 101.50 A*** 9,264,511
320 5.875%, 5/15/19 2/06 at 101.50 A 338,064
3,820 5.500%, 2/15/26 2/06 at 101.50 A 3,997,706
29
Nuveen Premium Income Municipal Fund 2, Inc. (NPM) (continued)
Portfolio of INVESTMENTS October 31, 2004
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK (continued)
New York City, New York, General Obligation Bonds, Fiscal
Series 1996F:
$ 6,145 7.000%, 2/01/06 No Opt. Call A*** $ 6,544,855
7,220 7.000%, 2/01/06 No Opt. Call A 7,653,489
New York City, New York, General Obligation Bonds, Fiscal
Series 1996I:
9,090 5.750%, 3/15/18 (Pre-refunded to 3/15/06) 3/06 at 101.50 A*** 9,731,300
2,040 5.875%, 3/15/18 3/06 at 101.50 A 2,158,708
4,000 New York City, New York, General Obligation Bonds, Fiscal 8/14 at 100.00 A 4,332,480
Series 2004C, 5.250%, 8/15/20
1,370 New York City Municipal Water Finance Authority, 6/07 at 101.00 AAA 1,468,791
New York, Water and Sewerage System Revenue Bonds,
Fiscal Series 1997B, 5.500%, 6/15/27 - MBIA Insured
3,150 New York City Municipal Water Finance Authority, 6/05 at 101.00 AAA 3,262,644
New York, Water and Sewerage System Revenue
Bonds, Fiscal Series 1996A, 5.875%, 6/15/25
(Pre-refunded to 6/15/05) - MBIA Insured
4,000 New York City Trust for Cultural Resources, New York, 4/07 at 101.00 AAA 4,293,200
Revenue Bonds, American Museum of Natural History,
Series 1997A, 5.650%, 4/01/27 - MBIA Insured
New York City Transitional Finance Authority, New York, Future
Tax Secured Bonds, Fiscal Series 2004B:
6,875 5.000%, 8/01/23 8/13 at 100.00 AA+ 7,250,856
7,260 5.000%, 8/01/24 8/13 at 100.00 AA+ 7,608,190
2,500 New York City Transitional Finance Authority, New York, 2/14 at 100.00 AA+ 2,660,800
Future Tax Secured Bonds, Fiscal Series 2004C,
5.000%, 2/01/22
1,500 Dormitory Authority of the State of New York, State and 7/14 at 100.00 AA- 1,633,380
Local Appropriation Lease Bonds, Upstate Community
Colleges, Series 2004B, 5.250%, 7/01/19
Dormitory Authority of the State of New York, Revenue Bonds,
Marymount Manhattan College, Series 1999:
1,975 6.375%, 7/01/16 - RAAI Insured 7/09 at 101.00 AA 2,202,342
2,080 6.375%, 7/01/17 - RAAI Insured 7/09 at 101.00 AA 2,316,579
7,635 New York State Medical Care Facilities Finance Agency, 5/05 at 102.00 AA-*** 7,945,286
Revenue Bonds, Mercy Medical Center - Rockville Center,
Series 1995A, 5.875%, 11/01/15 (Pre-refunded to 5/01/05)
New York State Municipal Bond Bank Agency, Special School
Purpose Revenue Bonds, Series 2003C:
6,000 5.250%, 6/01/20 6/13 at 100.00 A+ 6,468,060
5,100 5.250%, 6/01/21 6/13 at 100.00 A+ 5,467,404
6,250 Port Authority of New York and New Jersey, Special Project No Opt. Call AAA 7,318,688
Bonds, JFK International Air Terminal LLC, Sixth
Series 1997, 6.250%, 12/01/15 (Alternative Minimum
Tax) - MBIA Insured
5,000 New York City Sales Tax Asset Receivable Corporation, 10/14 at 100.00 AAA 5,371,250
New York, Local Government Assistance Corporation
Dedicated Revenue Bonds, Series 2004A, 5.000%, 10/15/22 (WI,
settling 11/04/04) - MBIA Insured
New York State Tobacco Settlement Financing Corporation, Tobacco
Settlement Asset-Backed and State Contingency Contract-Backed
Bonds, Series 2003A-1:
3,400 5.500%, 6/01/16 6/10 at 100.00 AA- 3,709,026
2,000 5.500%, 6/01/19 6/13 at 100.00 AA- 2,215,420
------------------------------------------------------------------------------------------------------------------------------------
NORTH CAROLINA - 1.6% (1.1% OF TOTAL INVESTMENTS)
2,550 Cumberland County, North Carolina, Hospital Facility 10/09 at 101.00 A- 2,652,281
Revenue Bonds, Cumberland County Hospital System
Inc., Cape Fear Valley Health System, Series 1999,
5.250%, 10/01/19
2,480 Durham Urban Redevelopment Authority, North Carolina, 8/07 at 105.00 AAA 2,660,023
FHA-Insured Mortgage Loan Revenue Bonds, Durham
Hosiery Mill, Series 1987, 7.500%, 8/01/29
(Alternative Minimum Tax)
855 North Carolina Housing Finance Agency, Single Family 3/06 at 102.00 AA 884,412
Revenue Bonds, Series 1996JJ, 6.450%, 9/01/27 (Alternative
Minimum Tax)
North Carolina Infrastructure Finance Corporation, Certificates
of Participation, Correctional Facilities, Series 2004A:
1,250 5.000%, 2/01/21 2/14 at 100.00 AA+ 1,327,437
2,445 5.000%, 2/01/22 2/14 at 100.00 AA+ 2,581,089
30
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
NORTH DAKOTA - 0.5% (0.3% OF TOTAL INVESTMENTS)
$ 2,565 North Dakota Housing Finance Agency, Home Mortgage 7/10 at 100.00 Aa3 $ 2,632,639
Finance Program Bonds, Series 2000C, 6.150%, 7/01/31
(Alternative Minimum Tax)
270 North Dakota Housing Finance Agency, Home Mortgage 1/07 at 102.00 Aa2 275,619
Finance Program Bonds, Series 1996B, 6.400%, 1/01/28
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
OHIO - 5.4% (3.6% OF TOTAL INVESTMENTS)
3,000 Columbus City School District, Franklin County, Ohio, 12/14 at 100.00 AAA 3,265,800
General Obligation Bonds, Series 2004, 5.250%, 12/01/24 -
FSA Insured
Franklin County, Ohio, Hospital Revenue Bonds, OhioHealth
Corporation, Series 2003C:
2,330 5.250%, 5/15/17 - MBIA Insured 5/13 at 100.00 AAA 2,547,808
4,105 5.250%, 5/15/18 - MBIA Insured 5/13 at 100.00 AAA 4,470,099
2,000 Ohio Housing Finance Agency, FHA-Insured Multifamily 1/08 at 102.00 Aa2 2,047,880
Housing Mortgage Revenue Bonds, Courtyards of Kettering,
Series 1998B-1, 5.550%, 1/01/40 (Alternative Minimum Tax)
3,595 Ohio Municipal Electric Generation Agency, Beneficial 2/14 at 100.00 AAA 3,867,213
Interest Certificates, Joint Venture 5, Belleville
Hydroelectric Project, American Municipal Power Ohio Inc.,
Series 2004, 5.000%, 2/15/20 - AMBAC Insured
5,000 Ohio Water Development Authority, Collateralized Water 2/05 at 100.00 BBB- 5,114,250
Revenue Refunding Bonds, Dayton Power and Light
Company, Series 1992A, 6.400%, 8/15/27
6,450 Ohio Water Development Authority, Solid Waste Disposal 9/08 at 102.00 N/R 6,356,669
Revenue Bonds, Bay Shore Power, Series 1998A,
5.875%, 9/01/20 (Alternative Minimum Tax)
6,700 Ohio Water Development Authority, Solid Waste Disposal 9/09 at 102.00 N/R 6,873,530
Revenue Bonds, Bay Shore Power, Series 1998B,
6.625%, 9/01/20 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
OKLAHOMA - 0.8% (0.5% OF TOTAL INVESTMENTS)
5,000 Oklahoma State Student Loan Authority, Senior Lien Revenue 6/11 at 102.00 AAA 5,205,150
Bonds, Series 2001A-1, 5.625%, 6/01/31 (Alternative
Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
OREGON - 2.6% (1.7% OF TOTAL INVESTMENTS)
7,860 Multnomah County Hospital Facilities Authority, Oregon, 10/14 at 100.00 AA 8,661,799
Revenue Bonds, Sisters of Providence Health System,
Series 2004, 5.500%, 10/01/21
705 Oregon, General Obligation Elderly and Disabled Housing 2/05 at 100.00 AA- 707,665
Bonds, Series 1992B, 6.375%, 8/01/24
1,380 Oregon, General Obligation Veterans Welfare Bonds, 10/05 at 102.00 Aa3 1,421,759
Series 75, 6.000%, 4/01/27
3,600 Oregon Department of Administrative Services, State Lottery No Opt. Call AAA 4,040,280
Revenue Bonds, Series 2004A, 5.000%, 4/01/14 -
FSA Insured
1,380 Portland, Oregon, Limited Tax General Obligation and 6/06 at 100.00 Aa2 1,454,520
Improvement Bonds, Series 1996A, 5.550%, 6/01/16
------------------------------------------------------------------------------------------------------------------------------------
PENNSYLVANIA - 0.6% (0.4% OF TOTAL INVESTMENTS)
2,400 Beaver County Industrial Development Authority, 7/05 at 102.00 A 2,536,224
Pennsylvania, Collateralized Pollution Control Revenue
Refunding Bonds, Cleveland Electric Illuminating Company -
Beaver Valley Project, Series 1995A, 7.750%, 7/15/25 -
ACA Insured
1,050 Delaware Valley Regional Finance Authority, Pennsylvania, No Opt. Call AAA 1,211,952
Local Government Revenue Bonds, Series 1997B,
5.700%, 7/01/27 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
PUERTO RICO - 0.2% (0.1% OF TOTAL INVESTMENTS)
1,375 Puerto Rico Electric Power Authority, Power Revenue 7/05 at 100.00 A-*** 1,409,320
Bonds, Series 1995X, 5.500%, 7/01/25 (Pre-refunded
to 7/01/05)
------------------------------------------------------------------------------------------------------------------------------------
RHODE ISLAND - 2.5% (1.7% OF TOTAL INVESTMENTS)
1,055 Rhode Island Health and Educational Building Corporation, 3/12 at 101.00 AA 1,107,560
Revenue Refunding Bonds, Salve Regina University,
Series 2002, 5.000%, 3/15/19 - RAAI Insured
Rhode Island Tobacco Settlement Financing Corporation,
Tobacco Settlement Asset-Backed Bonds, Series 2002A:
10,000 6.000%, 6/01/23 6/12 at 100.00 BBB 9,500,400
6,000 6.125%, 6/01/32 6/12 at 100.00 BBB 5,494,620
31
Nuveen Premium Income Municipal Fund 2, Inc. (NPM) (continued)
Portfolio of INVESTMENTS October 31, 2004
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
SOUTH CAROLINA - 9.4% (6.2% OF TOTAL INVESTMENTS)
$ 14,000 Berkeley County School District, South Carolina, Installment 12/13 at 100.00 A- $ 14,595,140
Purchase Revenue Bonds, Securing Assets for Education,
Series 2003, 5.250%, 12/01/24
15,445 Greenville County School District, South Carolina, 12/12 at 101.00 AA- 17,506,599
Installment Purchase Revenue Bonds, Series 2002,
5.875%, 12/01/17
2,500 Greenville, South Carolina, Hospital Facilities Revenue 5/13 at 100.00 AAA 2,600,975
Refunding Bonds, Series 2003A, 5.000%, 5/01/25 -
AMBAC Insured
7,600 Piedmont Municipal Power Agency, South Carolina, Electric 1/05 at 100.00 AAA 7,126,824
Revenue Bonds, Series 1991, 4.000%, 1/01/23 -
MBIA Insured
6,000 South Carolina JOBS Economic Development Authority, 11/12 at 100.00 A- 6,187,620
Economic Development Revenue Bonds Bon Secours
Health System Inc., Series 2002A, 5.625%, 11/15/30
South Carolina JOBS Economic Development Authority, Hospital
Refunding and Improvement Revenue Bonds, Palmetto Health
Alliance, Series 2003C:
1,500 6.875%, 8/01/27 8/13 at 100.00 BBB 1,662,960
5,000 6.375%, 8/01/34 8/13 at 100.00 BBB 5,348,650
5,000 Tobacco Settlement Revenue Management Authority, 5/11 at 101.00 BBB 4,798,400
South Carolina, Tobacco Settlement Asset-Backed Bonds,
Series 2001B, 6.000%, 5/15/22
------------------------------------------------------------------------------------------------------------------------------------
TENNESSEE - 0.3% (0.2% OF TOTAL INVESTMENTS)
1,500 Memphis-Shelby County Airport Authority, Tennessee, 3/10 at 101.00 AAA 1,672,365
Airport Revenue Bonds, Series 1999D, 6.000%, 3/01/19
(Alternative Minimum Tax) - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
TEXAS - 12.6% (8.4% OF TOTAL INVESTMENTS)
4,000 Austin, Texas, Airport System Prior Lien Revenue Bonds, 11/13 at 100.00 AAA 4,429,040
Series 2003, 5.250%, 11/15/16 - MBIA Insured
2,290 Austin, Texas, Revenue Bonds, Town Lake Park Community 11/09 at 100.00 AAA 2,571,281
Events Center, Series 1999, 6.000%, 11/15/25 - FGIC Insured
5,000 Brazos River Authority, Texas, Pollution Control Revenue 5/08 at 102.00 AAA 5,581,600
Refunding Bonds, Texas Utilities Electric Company Project,
Series 1998A, 5.550%, 5/01/33 (Alternative Minimum Tax)
(Pre-refunded to 5/01/08) - AMBAC Insured
5,000 Brazos River Authority, Texas, Pollution Control Revenue 4/08 at 102.00 AAA 5,572,300
Bonds, Texas Utilities Electric Company Project,
Series 1995C, 5.550%, 6/01/30 (Alternative Minimum Tax)
(Pre-refunded to 4/01/08) - MBIA Insured
5,110 Brazos River Authority, Texas, Pollution Control Revenue 4/13 at 101.00 BBB 6,074,564
Refunding Bonds, TXU Electric Company Project,
Series 1999C, 7.700%, 3/01/32 (Alternative Minimum Tax)
10,000 Brazos River Harbor Navigation District, Brazoria County, 5/12 at 101.00 A- 10,945,100
Texas, Environmental Facilities Revenue Bonds, Dow
Chemical Company Project, Series 2002A-6, 6.250%, 5/15/33
(Alternative Minimum Tax) (Mandatory put 5/15/17)
3,345 Fort Worth, Texas, Water and Sewerage Revenue Bonds, 2/12 at 100.00 AA 3,796,608
Series 2001, 5.625%, 2/15/19
5,000 Gulf Coast Industrial Development Authority, Texas, Waste 6/08 at 102.00 BBB 5,027,100
Disposal Revenue Bonds, Valero Refining and Marketing
Company Project, Series 1997, 5.600%, 12/01/31
(Alternative Minimum Tax)
2,800 Harris County-Houston Sports Authority, Texas, Senior Lien 11/11 at 100.00 AAA 2,911,804
Revenue Bonds, Series 2001G, 5.250%, 11/15/30 -
MBIA Insured
Harris County Health Facilities Development Corporation, Texas,
Hospital Revenue Bonds, Memorial Hermann Healthcare System,
Series 2004A:
1,000 5.000%, 12/01/20 12/14 at 100.00 A 1,021,990
1,000 5.000%, 12/01/21 12/14 at 100.00 A 1,017,000
2,500 5.125%, 12/01/22 12/14 at 100.00 A 2,559,250
480 Hidalgo County Housing Finance Corporation, Texas, 4/05 at 101.00 Aaa 483,854
GNMA/FNMA Collateralized Single Family Mortgage
Revenue Bonds, Series 1994A, 7.000%, 10/01/27
(Alternative Minimum Tax)
10,850 Houston, Texas, Hotel Occupancy Tax and Special Revenue No Opt. Call AAA 3,768,097
Bonds, Convention and Entertainment Project, Series 2001B,
0.000%, 9/01/25 - AMBAC Insured
4,000 Houston, Texas, First Lien Combined Utility System Revenue 5/14 at 100.00 AAA 4,309,440
Bonds, Series 2004A, 5.250%, 5/15/24 - FGIC Insured
32
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
TEXAS (continued)
$ 6,185 Keller Independent School District, Tarrant County, Texas, 8/11 at 100.00 AAA $ 6,495,982
Unlimited Tax General Obligation Refunding Bonds,
Series 2001, 5.250%, 8/15/26
1,760 Laredo, Texas, Sports Venue Sales Tax Revenue Bonds, 3/09 at 100.00 AAA 1,964,389
Series 2001, 5.750%, 3/15/16 - FGIC Insured
2,000 Pearland Independent School District, Brazoria County, 2/11 at 100.00 AAA 2,122,360
Texas, Unlimited Tax Schoolhouse Bonds, Series 2001A,
5.250%, 2/15/22
3,935 Spring Branch Independent School District, Harris County, 2/11 at 100.00 AAA 4,067,098
Texas, Limited Tax Schoolhouse and Refunding Bonds,
Series 2001, 5.125%, 2/01/26
3,900 Texas, General Obligation Bonds, Veterans Housing 12/11 at 101.00 Aa1 4,068,987
Assistance Program Fund II, Series 2001C-1,
5.200%, 12/01/21 (Alternative Minimum Tax)
6,945 Weatherford Independent School District, Parker County, 2/11 at 44.73 AAA 2,250,041
Texas, Unlimited Tax School Building and Refunding
Bonds, Series 2001, 0.000%, 2/15/25
------------------------------------------------------------------------------------------------------------------------------------
UTAH - 0.7% (0.5% OF TOTAL INVESTMENTS)
410 Utah Housing Finance Agency, Single Family Mortgage 1/05 at 102.00 AAA 412,366
Bonds, Series 1994B, 6.450%, 7/01/14
330 Utah Housing Finance Agency, Single Family Mortgage 7/07 at 101.50 AAA 345,804
Bonds, Series 1997E-2, 5.875%, 1/01/19 (Alternative
Minimum Tax)
565 Utah Housing Finance Agency, Single Family Mortgage 1/09 at 101.50 AAA 599,019
Bonds, Series 1997C, 5.600%, 7/01/18 (Alternative
Minimum Tax)
3,000 Weber County Municipal Building Authority, Utah, Lease 12/04 at 102.00 Aaa 3,081,690
Revenue Bonds, Series 1994, 7.500%, 12/15/19
(Pre-refunded to 12/15/04) - RAAI Insured
------------------------------------------------------------------------------------------------------------------------------------
VERMONT - 0.9% (0.6% OF TOTAL INVESTMENTS)
5,635 Vermont Housing Finance Agency, Single Family Housing 11/04 at 100.00 A+ 5,680,418
Bonds, Series 1992-4, 6.400%, 11/01/25
------------------------------------------------------------------------------------------------------------------------------------
VIRGINIA - 0.5% (0.3% OF TOTAL INVESTMENTS)
3,000 Metropolitan Washington D.C. Airports Authority, Airport 10/14 at 100.00 AAA 3,199,290
System Revenue Bonds, Series 2004A,
5.000%, 10/01/21 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
WASHINGTON - 9.4% (6.2% OF TOTAL INVESTMENTS)
15,000 Chelan County Public Utility District 1, Washington, 7/12 at 100.00 AAA 15,640,050
Hydro Consolidated System Revenue Bonds, Series 2002A,
5.450%, 7/01/37 (Alternative Minimum Tax) -
AMBAC Insured
7,500 Energy Northwest, Washington, Electric Revenue 7/12 at 100.00 AAA 8,610,150
Refunding Bonds, Columbia Generating Station,
Series 2002C, 5.750%, 7/01/17 - MBIA Insured
5,000 Energy Northwest, Washington, Electric Revenue Refunding 7/13 at 100.00 Aaa 5,624,700
Bonds, Nuclear Project 1, Series 2003A, 5.500%, 7/01/16
10,080 King County School District 401, Highline, Washington, 6/12 at 100.00 AAA 11,434,651
General Obligation Bonds, Series 2002,
5.500%, 12/01/16 - FGIC Insured
6,965 Port of Seattle, Washington, Revenue Bonds, 9/12 at 100.00 AAA 7,494,549
Series 1999A, 5.250%, 9/01/22 - FGIC Insured
2,820 Skagit County Public Hospital District 1, Washington, 12/14 at 100.00 Aaa 3,150,363
Revenue Bonds, Skagit Valley Hospital, Series 2004A,
5.375%, 12/01/19 - MBIA Insured
2,500 Snohomish County, Washington, Limited Tax General 12/11 at 100.00 AAA 2,644,650
Obligation Bonds, Series 2001, 5.125%, 12/01/22 -
MBIA Insured
4,905 Washington, Various Purpose General Obligation Bonds, 1/09 at 100.00 Aa1 5,238,932
Series 1999B, 5.000%, 1/01/19
------------------------------------------------------------------------------------------------------------------------------------
WEST VIRGINIA - 2.1% (1.4% OF TOTAL INVESTMENTS)
7,000 Harrison County Commission, West Virginia, Solid Waste 11/04 at 101.00 AAA 7,092,120
Disposal Revenue Bonds, Potomac Edison Company -
Harrison Station, Series 1993B, 6.250%, 5/01/23
(Alternative Minimum Tax) - AMBAC Insured
5,000 Mason County, West Virginia, Pollution Control Revenue 10/11 at 100.00 BBB 5,107,900
Bonds, Appalachian Power Company, Series 2003L,
5.500%, 10/01/22
1,000 Pleasants County, West Virginia, Pollution Control Revenue 4/09 at 101.00 AAA 1,042,470
Bonds, West Penn Power Company Pleasants Station
Project, Series 1999E, 5.500%, 4/01/29 (Alternative
Minimum Tax) - AMBAC Insured
33
Nuveen Premium Income Municipal Fund 2, Inc. (NPM) (continued)
Portfolio of INVESTMENTS October 31, 2004
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
WISCONSIN - 1.3% (0.9% OF TOTAL INVESTMENTS)
$ 3,215 Wisconsin Health and Educational Facilities Authority, 2/07 at 102.00 AAA $ 3,495,637
Revenue Bonds, Marshfield Clinic, Series 1997,
5.625%, 2/15/17 - MBIA Insured
4,000 Wisconsin Health and Educational Facilities Authority, 2/09 at 101.00 BBB+ 4,047,600
Revenue Bonds, Aurora Health Care Inc., Series 1999A,
5.600%, 2/15/29
1,000 Wisconsin Health and Educational Facilities Authority, 5/14 at 100.00 BBB+ 1,030,393
Revenue Bonds, Fort Healthcare Inc., Series 2004,
5.750%, 5/01/24
------------------------------------------------------------------------------------------------------------------------------------
$ 1,026,191 Total Long-Term Investments (cost $903,350,450) - 150.3% 958,976,390
=============-----------------------------------------------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS - 0.1% (0.1% OF TOTAL INVESTMENTS)
600 Athens-Clarke County Unified Government Development N/R 600,000
Authority, Georgia, Revenue Bonds, University of Georgia
Athletic Association Project, Variable Rate Demand
Obligations, Series 2003, 1.750%, 8/01/33 +
------------------------------------------------------------------------------------------------------------------------------------
$ 600 Total Short-Term Investments (cost $600,000) 600,000
=============-----------------------------------------------------------------------------------------------------------------------
Total Investments (cost $903,950,450) - 150.4% 959,576,390
--------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 4.0% 25,404,930
--------------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (54.4)% (347,000,000)
--------------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 637,981,320
====================================================================================================================
(1) All percentages shown in the Portfolio of Investments
are based on net assets applicable to Common shares
unless otherwise noted.
* Optional Call Provisions (not covered by the report of
independent registered public accounting firm): Dates
(month and year) and prices of the earliest optional
call or redemption. There may be other call provisions
at varying prices at later dates.
** Ratings (not covered by the report of independent
registered public accounting firm): Using the higher of
Standard & Poor's or Moody's rating.
*** Securities are backed by an escrow or trust containing
sufficient U.S. Government or U.S. Government agency
securities which ensures the timely payment of
principal and interest. Such securities are normally
considered to be equivalent to AAA rated securities.
N/R Investment is not rated.
(WI) Security purchased on a when-issued basis.
+ Security has a maturity of more than one year, but has
variable rate and demand features which qualify it as a
short-term security. The rate disclosed is that
currently in effect. This rate changes periodically
based on market conditions or a specified market index.
See accompanying notes to financial statements.
34
Nuveen Premium Income Municipal Fund 4, Inc. (NPT)
Portfolio of
INVESTMENTS October 31, 2004
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
ALABAMA - 3.4% (2.2% OF TOTAL INVESTMENTS)
$ 2,395 Alabama Housing Finance Authority, FNMA Multifamily 2/11 at 102.00 AAA $ 2,505,769
Housing Revenue Bonds, South Bay Apartments,
Series 2000K, 5.950%, 2/01/33 (Alternative Minimum Tax)
11,895 Alabama Special Care Facilities Financing Authority, 11/05 at 101.00 Aaa 12,290,152
Birmingham, Hospital Revenue Bonds, Daughters of
Charity National Health System - Providence Hospital
and St. Vincent's Hospital, Series 1995, 5.000%, 11/01/25
5,150 Alabama 21st Century Authority, Tobacco Settlement 12/11 at 101.00 A- 5,242,700
Revenue Bonds, Series 2001, 5.750%, 12/01/16
------------------------------------------------------------------------------------------------------------------------------------
ALASKA - 0.6% (0.4% OF TOTAL INVESTMENTS)
3,065 Alaska Municipal Bond Bank Authority, General Obligation 12/13 at 100.00 AAA 3,271,336
Bonds, Series 2003E, 5.250%, 12/01/26 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
ARIZONA - 1.6% (1.1% OF TOTAL INVESTMENTS)
5,000 Arizona Tourism and Sports Authority, Tax Revenue Bonds, 7/13 at 100.00 Aaa 5,150,400
Multipurpose Stadium Facility Project, Series 2003A,
5.000%, 7/01/31 - MBIA Insured
4,100 Salt River Project Agricultural Improvement and Power 12/13 at 100.00 AAA 4,443,867
District, Arizona, Electric System Revenue Bonds,
Series 2003, 5.000%, 12/01/18 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
ARKANSAS - 0.1% (0.0% OF TOTAL INVESTMENTS)
110 Arkansas Development Finance Authority, FHA-Insured 2/05 at 100.00 AA 110,336
or VA Guaranteed Mortgage Loans, Single Family
Mortgage Revenue Refunding Bonds, Series 1991A,
8.000%, 8/15/11
111 Jacksonville Residential Housing Facilities Board, Arkansas, 1/05 at 102.00 Aaa 113,111
FNMA Mortgage-Backed Securities Program Single
Family Mortgage Revenue Refunding Bonds,
Series 1993A-2, 7.900%, 1/01/11
170 Lonoke County Residential Housing Facilities Board, 4/05 at 103.00 Aaa 174,475
Arkansas, FNMA Mortgage-Backed Securities Program
Single Family Mortgage Revenue Refunding Bonds,
Series 1993A, 7.900%, 4/01/11
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA - 7.2% (4.7% OF TOTAL INVESTMENTS)
17,000 California Health Facilities Financing Authority, Health 3/13 at 100.00 A 17,050,660
Facility Revenue Bonds, Adventist Health System/West,
Series 2003A, 5.000%, 3/01/33
10,000 California, General Obligation Bonds, Series 2003, 8/13 at 100.00 A 10,750,600
5.250%, 2/01/22
4,500 California, General Obligation Bonds, Series 2004, 2/09 at 100.00 A 4,568,535
5.100%, 2/01/34
4,780 Foothill/Eastern Transportation Corridor Agency, California, No Opt. Call AAA 3,370,665
Toll Road Revenue Bonds, Series 1995A, 0.000%, 1/01/14
1,000 Golden State Tobacco Securitization Corporation, California, 6/13 at 100.00 BBB 982,190
Tobacco Settlement Asset-Backed Bonds, Series 2003A-1,
6.750%, 6/01/39
3,000 Los Angeles Department of Water and Power, California, 7/06 at 100.00 AA- 3,127,980
Power System Revenue Bonds, Series 2001A-3,
5.375%, 7/01/20
1,945 South Gate Public Financing Authority, California, Water No Opt. Call AAA 2,307,665
Revenue Refunding Bonds, Series 1996A,
6.000%, 10/01/12 - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
COLORADO - 5.1% (3.3% OF TOTAL INVESTMENTS)
2,000 Colorado Health Facilities Authority, Revenue Refunding 9/11 at 100.00 AA 2,108,400
Bonds, Catholic Health Initiatives, Series 2001,
5.250%, 9/01/21
1,015 Colorado Housing Finance Authority, Single Family Program 10/09 at 105.00 Aa2 1,049,875
Senior Bonds, Series 1999C-3, 6.750%, 10/01/21
3,040 Denver City and County, Colorado, Airport System Revenue No Opt. Call A 3,718,194
Bonds, Series 1991D, 7.750%, 11/15/13 (Alternative
Minimum Tax)
35
Nuveen Premium Income Municipal Fund 4, Inc. (NPT) (continued)
Portfolio of INVESTMENTS October 31, 2004
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
COLORADO (continued)
Denver Convention Center Hotel Authority, Colorado, Senior
Revenue Bonds, Convention Center Hotel, Series 2003A:
$ 2,940 5.000%, 12/01/20 - XLCA Insured 12/13 at 100.00 AAA $ 3,130,953
10,000 5.000%, 12/01/33 - XLCA Insured 12/13 at 100.00 AAA 10,238,000
4,345 El Paso County School District 20, Academy, Colorado, 12/12 at 100.00 Aaa 4,859,448
General Obligation Bonds, Series 2002, 5.250%, 12/15/17 -
FGIC Insured
4,125 Municipal Subdistrict Northern Colorado Water District, 12/07 at 101.00 AAA 4,506,686
Revenue Bonds, Series 1997G, 5.250%, 12/01/15 -
AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
CONNECTICUT - 0.5% (0.3% OF TOTAL INVESTMENTS)
3,000 Connecticut Housing Finance Authority, Housing Mortgage 5/06 at 102.00 AAA 3,147,240
Finance Program Bonds, Series 1996C-2, 6.250%, 11/15/18
------------------------------------------------------------------------------------------------------------------------------------
DISTRICT OF COLUMBIA - 4.7% (3.0% OF TOTAL INVESTMENTS)
6,000 District of Columbia, General Obligation Bonds, No Opt. Call AAA 6,786,840
Series 1993B-2, 5.500%, 6/01/10 - FSA Insured
4,250 District of Columbia, Hospital Revenue Refunding Bonds, 8/06 at 102.00 AAA 4,581,755
Medlantic Healthcare Group, Series 1993A,
5.750%, 8/15/14 - MBIA Insured
5 District of Columbia, General Obligation Bonds, 12/04 at 101.00 AAA 5,067
Series 1993E, 6.000%, 6/01/09 - CAPMAC Insured
District of Columbia, General Obligation Refunding Bonds,
Series 1993A:
1,585 6.000%, 6/01/07 - MBIA Insured No Opt. Call AAA 1,690,387
7,215 6.000%, 6/01/07 - MBIA Insured No Opt. Call AAA 7,906,486
District of Columbia, Revenue Bonds, Georgetown University,
Series 2001A:
9,670 0.000%, 4/01/26 - MBIA Insured 4/11 at 42.15 AAA 2,897,519
15,235 0.000%, 4/01/30 - MBIA Insured 4/11 at 32.93 AAA 3,522,332
------------------------------------------------------------------------------------------------------------------------------------
FLORIDA - 6.7% (4.3% OF TOTAL INVESTMENTS)
5,000 Broward County School Board, Florida, Certificates of 7/13 at 100.00 AAA 5,166,700
Participation, Series 2003, 5.000%, 7/01/28 - MBIA Insured
2,500 Florida State Board of Education, Full Faith and Credit Public 6/06 at 101.00 AA+ 2,624,600
Education Capital Outlay Bonds, Series 1996A,
5.250%, 6/01/22
5,000 Hillsborough County Aviation Authority, Florida, Revenue 10/13 at 100.00 AAA 5,396,800
Bonds, Tampa International Airport, Series 2003A,
5.250%, 10/01/18 (Alternative Minimum Tax) -
MBIA Insured
9,000 JEA, Florida, Water and Sewerage System Revenue Bonds, 10/05 at 100.00 AA-*** 9,283,950
Series 2001A, 5.200%, 10/01/20 (Pre-refunded to 10/01/05)
5,000 Martin County Industrial Development Authority, Florida, 12/04 at 102.00 BBB- 5,130,850
Industrial Development Revenue Bonds, Indiantown
Cogeneration LP Project, Series 1994A, 7.875%, 12/15/25
(Alternative Minimum Tax)
1,380 Miami-Dade County Housing Finance Authority, Florida, 1/11 at 102.00 AAA 1,475,648
Multifamily Housing Revenue Bonds, Sunset Bay Apartments,
Series 2000-5A, 5.850%, 7/01/20 (Alternative Minimum
Tax) - FSA Insured
9,500 Sunrise, Florida, Utility System Revenue Refunding Bonds, 10/18 at 100.00 AAA 9,965,025
Series 1998, 5.000%, 10/01/28 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
GEORGIA - 2.4% (1.6% OF TOTAL INVESTMENTS)
3,400 Atlanta, Georgia, Water and Wastewater Revenue Bonds, No Opt. Call AAA 3,975,722
Series 1999A, 5.500%, 11/01/22 - FGIC Insured
2,880 Georgia Municipal Electric Authority, General Power Revenue No Opt. Call A+ 3,663,187
Bonds, Series 1992B, 8.250%, 1/01/11
5,500 Georgia Municipal Electric Authority, General Power Revenue No Opt. Call AAA 6,514,200
Bonds, Series 1993B, 5.700%, 1/01/19 - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
HAWAII - 1.0% (0.7% OF TOTAL INVESTMENTS)
Honolulu City and County, Hawaii, General Obligation Refunding
and Improvement Bonds, Series 1993B:
1,580 5.000%, 10/01/13 No Opt. Call Aaa 1,781,529
3,720 5.000%, 10/01/13 No Opt. Call Aa2 4,148,879
36
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS - 14.7% (9.5% OF TOTAL INVESTMENTS)
$ 4,000 Chicago Board of Education, Illinois, General Obligation No Opt. Call AAA $ 4,783,960
Lease Certificates, Series 1992A, 6.250%, 1/01/15 -
MBIA Insured
5,550 Chicago, Illinois, Revenue Bonds, Midway Airport, 1/11 at 101.00 AAA 5,682,701
Series 2001A, 5.125%, 1/01/26 (Alternative Minimum
Tax) - FSA Insured
5,000 Chicago, Illinois, Sales Tax Revenue Bonds, Series 1998, 7/08 at 102.00 AAA 5,231,400
5.250%, 1/01/28 - FGIC Insured
Cook County School District 99, Cicero, Illinois, General
Obligation School Bonds, Series 1997:
1,455 8.500%, 12/01/13 - FGIC Insured No Opt. Call Aaa 2,012,585
1,685 8.500%, 12/01/15 - FGIC Insured No Opt. Call Aaa 2,403,686
6,155 Illinois Development Finance Authority, Revenue Bonds, 4/11 at 105.00 Aaa 6,805,030
Greek American Nursing Project, Series 2000A,
7.600%, 4/20/40
450 Illinois Educational Facilities Authority, Revenue Bonds, 1/05 at 100.00 AAA 470,691
Chicago College of Osteopathic Medicine, Series 1975A,
8.750%, 7/01/05
Illinois Health Facilities Authority, Revenue Refunding Bonds,
Lutheran General Health System, Series 1993C:
5,705 7.000%, 4/01/08 No Opt. Call A+ 6,201,050
4,075 7.000%, 4/01/14 No Opt. Call A+ 5,064,043
4,000 Illinois Health Facilities Authority, FHA-Insured Mortgage 8/13 at 100.00 AAA 4,060,760
Revenue Refunding Bonds, Sinai Health System,
Series 2003, 5.150%, 2/15/37
7,085 Illinois Housing Development Authority, Multifamily Program 3/05 at 102.00 A+ 7,236,052
Bonds, Series 1994-5, 6.650%, 9/01/14
3,410 Illinois Housing Development Authority, Section 8 Elderly 11/04 at 100.00 A- 3,414,569
Housing Revenue Bonds, Skyline Towers Apartments,
Series 1992B, 6.875%, 11/01/17
9,795 Lake, Cook, Kane and McHenry Counties Community Unit No Opt. Call AAA 11,261,899
School District 220, Barrington, Illinois, School Refunding
Bonds, Series 2002, 5.250%, 12/01/19 - FSA Insured
Metropolitan Pier and Exposition Authority, Illinois, Revenue
Bonds, McCormick Place Expansion Project, Series 2002A:
9,500 0.000%, 6/15/24 - MBIA Insured 6/22 at 101.00 AAA 5,466,110
4,540 5.000%, 12/15/28 - MBIA Insured 6/12 at 101.00 AAA 4,660,719
34,440 0.000%, 6/15/40 - MBIA Insured No Opt. Call AAA 5,177,365
3,050 Regional Transportation Authority, Cook, DuPage, Kane, No Opt. Call AAA 4,066,687
Lake, McHenry and Will Counties, Illinois, General
Obligation Bonds, Series 1990A, 7.200%, 11/01/20 -
AMBAC Insured
2,162 Wood River Township, Madison County, Illinois, General 2/05 at 101.00 N/R 1,967,439
Obligation Bonds, Series 1993, 6.625%, 2/01/14
------------------------------------------------------------------------------------------------------------------------------------
INDIANA - 8.7% (5.6% OF TOTAL INVESTMENTS)
22,000 Indiana Health Facility Financing Authority, Hospital 8/10 at 101.50 AAA 23,525,260
Revenue Bonds, Clarian Health Obligated Group,
Series 2000A, 5.500%, 2/15/30 - MBIA Insured
3,000 Indiana Health Facility Financing Authority, Hospital Revenue No Opt. Call AAA 3,730,170
Refunding Bonds, Columbus Regional Hospital,
Series 1993, 7.000%, 8/15/15 - FSA Insured
3,500 Indiana Educational Facilities Authority, Revenue Bonds, 2/11 at 100.00 AAA 3,818,115
Butler University, Series 2001, 5.500%, 2/01/26 -
MBIA Insured
1,500 Indiana Educational Facilities Authority, Revenue Bonds, 10/09 at 101.00 AAA 1,698,525
University of Indianapolis, Series 1999,
5.750%, 10/01/19 - FSA Insured
Indiana Transportation Finance Authority, Highway Revenue
Bonds, Series 2003A:
4,000 5.000%, 6/01/23 - FSA Insured 6/13 at 100.00 AAA 4,206,480
6,000 5.000%, 6/01/24 - FSA Insured 6/13 at 100.00 AAA 6,283,380
2,100 Indianapolis, Indiana, Economic Development Revenue 1/05 at 102.00 Ca 1,428,000
Bonds, Meadows Section 8 Assisted Project,
Series 1993A, 6.000%, 7/01/23 (Alternative Minimum Tax) #
710 Kokomo Hospital Authority, Indiana, Hospital Revenue 2/05 at 101.00 N/R*** 733,380
Refunding Bonds, St. Joseph Hospital and Health Center,
Series 1993, 6.250%, 8/15/05
5,000 Metropolitan School District Warren Township Vision 2005 1/11 at 100.00 AAA 5,562,450
School Building Corporation, Marion County, Indiana,
First Mortgage Bonds, Series 2000, 5.500%, 7/15/20 -
FGIC Insured
37
Nuveen Premium Income Municipal Fund 4, Inc. (NPT) (continued)
Portfolio of INVESTMENTS October 31, 2004
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
IOWA - 0.0% (0.0% OF TOTAL INVESTMENTS)
$ 60 Davenport, Iowa, Home Ownership Mortgage Revenue 3/05 at 102.00 Aa2 $ 60,661
Refunding Bonds, Series 1994, 7.900%, 3/01/10
------------------------------------------------------------------------------------------------------------------------------------
KANSAS - 1.8% (1.2% OF TOTAL INVESTMENTS)
2,000 Olathe, Kansas, Health Facilities Revenue Bonds, Olathe 9/10 at 100.00 AAA 2,176,880
Medical Center, Series 2000A, 5.500%, 9/01/25 -
AMBAC Insured
6,825 Sedgwick County Unified School District 259, Wichita, 9/10 at 100.00 AA 6,634,173
Kansas, General Obligation Bonds, Series 2000,
3.500%, 9/01/16
1,750 Wamego, Kansas, Pollution Control Revenue Bonds, Kansas 6/14 at 100.00 AAA 1,860,373
Gas and Electric Company, Series 2004, 5.300%, 6/01/31 -
MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
LOUISIANA - 1.8% (1.2% OF TOTAL INVESTMENTS)
3,070 Jefferson Sales Tax District, Jefferson Parish, Louisiana, 12/12 at 100.00 AAA 3,345,041
Special Sales Tax Revenue Refunding Bonds, Series 2002,
5.250%, 12/01/20 - AMBAC Insured
1,750 Louisiana Local Government Environmental Facilities 6/12 at 105.00 Aaa 1,948,555
and Community Development Authority, GNMA Collateralized
Mortgage Revenue Refunding Bonds, Sharlo Apartments
Project, Series 2002A, 6.500%, 6/20/37
4,890 Orleans Levee District, Louisiana, Levee District General 12/05 at 103.00 AAA 5,242,422
Obligation Bonds, Series 1986, 5.950%, 11/01/14 -
FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
MAINE - 2.5% (1.6% OF TOTAL INVESTMENTS)
7,520 Maine Educational Loan Marketing Corporation, Student No Opt. Call A2 7,878,478
Loan Revenue Bonds, Subordinate Series 1994B-2,
6.250%, 11/01/06 (Alternative Minimum Tax)
6,635 Maine State Housing Authority, Mortgage Purchase Bonds, 5/10 at 100.00 AA+ 6,947,973
Series 2000C-1, 6.050%, 11/15/31 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
MARYLAND - 2.7% (1.8% OF TOTAL INVESTMENTS)
3,215 Maryland Community Development Administration, Housing 1/07 at 102.00 Aa2 3,366,394
Revenue Bonds, Series 1996A, 5.875%, 7/01/16
2,900 Maryland Community Development Administration, 7/07 at 102.00 Aa2 3,021,597
Housing Revenue Bonds, Series 1997A, 6.000%, 7/01/39
(Alternative Minimum Tax)
6,800 Montgomery County Housing Opportunities Commission, 7/06 at 102.00 Aa2 7,058,060
Maryland, GNMA/FHA-Insured Multifamily Housing
Revenue Bonds, Series 1996B, 6.400%, 7/01/28
(Alternative Minimum Tax)
2,315 Montgomery County Housing Opportunities Commission, 7/10 at 100.00 Aaa 2,486,333
Maryland, Multifamily Housing Development Bonds,
Series 2000B, 6.125%, 7/01/20 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
MASSACHUSETTS - 0.0% (0.0% OF TOTAL INVESTMENTS)
35 Massachusetts Housing Finance Agency, Housing Project 4/05 at 100.00 A+ 35,274
Revenue Refunding Bonds, Series 1993A, 6.300%, 10/01/13
------------------------------------------------------------------------------------------------------------------------------------
MICHIGAN - 5.2% (3.4% OF TOTAL INVESTMENTS)
10,225 Detroit, Michigan, Senior Lien Water Supply System Revenue 7/07 at 101.00 AAA 10,569,378
Bonds, Series 1997A, 5.000%, 7/01/27 - MBIA Insured
Hancock Hospital Finance Authority, Michigan, FHA-Insured
Mortgage Hospital Revenue Bonds, Portage Health System
Inc., Series 1998:
1,645 4.625%, 8/01/18 - MBIA Insured 8/08 at 100.00 AAA 1,684,233
4,400 5.450%, 8/01/47 - MBIA Insured 8/08 at 100.00 AAA 4,519,372
5,000 Michigan State Building Authority, Revenue Refunding 10/13 at 100.00 AAA 5,158,400
Bonds, Facilities Program, Series 2003II,
5.000%, 10/15/29 - MBIA Insured
10,500 Michigan State Hospital Finance Authority, Hospital Revenue 8/08 at 101.00 Ba3 8,407,665
Bonds, Detroit Medical Center Obligated Group,
Series 1998A, 5.250%, 8/15/23
------------------------------------------------------------------------------------------------------------------------------------
MINNESOTA - 1.5% (0.9% OF TOTAL INVESTMENTS)
1,945 Minneapolis-St. Paul Housing Finance Board, Minnesota, 11/07 at 102.00 AAA 2,009,769
FNMA/GNMA Mortgage-Backed Securities Program Single
Family Mortgage Revenue Bonds, Series 1997,
5.800%, 11/01/30 (Alternative Minimum Tax)
38
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
MINNESOTA (continued)
$ 3,500 Minneapolis-St. Paul Metropolitan Airports Commission, 1/11 at 100.00 AAA $ 3,733,835
Minnesota, Airport Revenue Bonds, Series 2001A,
5.250%, 1/01/25 - FGIC Insured
2,685 Minnetonka, Minnesota, GNMA Collateralized Multifamily 12/04 at 102.00 AAA 2,744,553
Housing Revenue Refunding Bonds, Brier Creek Project,
Series 1994A, 6.450%, 6/20/24
------------------------------------------------------------------------------------------------------------------------------------
MISSISSIPPI - 1.7% (1.1% OF TOTAL INVESTMENTS)
2,000 Mississippi Higher Education Assistance Corporation, 3/05 at 100.00 Aaa 2,005,380
Student Loan Revenue Bonds, Senior Series 1993B,
5.800%, 9/01/06 (Alternative Minimum Tax)
1,875 Mississippi Hospital Equipment and Facilities Authority, 9/14 at 100.00 N/R 1,890,544
Revenue Bonds, Baptist Memorial Health Care,
Series 2004-B1, 5.000%, 9/01/24
5,180 Mississippi, General Obligation Refunding Bonds, No Opt. Call AA 6,124,314
Series 2002A, 5.500%, 12/01/18
------------------------------------------------------------------------------------------------------------------------------------
MISSOURI - 0.4% (0.2% OF TOTAL INVESTMENTS)
2,000 St. Louis, Missouri, Airport Revenue Bonds, Airport 7/11 at 100.00 AAA 2,058,700
Development Program, Series 2001A, 5.000%, 7/01/26 -
MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
NEBRASKA - 1.6% (1.1% OF TOTAL INVESTMENTS)
9,000 Nebraska Higher Education Loan Program Incorporated, No Opt. Call AAA 9,612,900
Senior Subordinate Bonds, Series 1993A-5A,
6.250%, 6/01/18 (Alternative Minimum Tax) - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
NEVADA - 4.6% (3.0% OF TOTAL INVESTMENTS)
7,000 Clark County, Nevada, Motor Vehicle Fuel Tax Highway 7/13 at 100.00 AAA 7,358,960
Improvement Revenue Bonds, Series 2003,
5.000%, 7/01/23 - AMBAC Insured
10,420 Clark County School District, Nevada, General Obligation 6/12 at 100.00 AAA 11,811,591
Bonds, Series 2002C, 5.500%, 6/15/18 - MBIA Insured
4,500 Clark County School District, Nevada, General Obligation No Opt. Call AAA 5,431,275
School Improvement Bonds, Series 1991A,
7.000%, 6/01/10 - MBIA Insured
5,425 Director of Nevada State Department of Business and No Opt. Call AAA 1,930,595
Industry, Revenue Bonds, Las Vegas Monorail Project,
First Tier, Series 2000, 0.000%, 1/01/25 - AMBAC Insured
630 Nevada Housing Division, Single Family Mortgage Bonds, 4/05 at 101.00 A1 643,558
Senior Series 1992B-1, 6.200%, 10/01/15
------------------------------------------------------------------------------------------------------------------------------------
NEW HAMPSHIRE - 0.0% (0.0% OF TOTAL INVESTMENTS)
10 New Hampshire Housing Finance Agency, Single Family 1/07 at 102.00 Aa2 10,513
Mortgage Acquisition Revenue Bonds, Series 1996C,
6.200%, 7/01/16 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
NEW JERSEY - 3.7% (2.4% OF TOTAL INVESTMENTS)
1,100 New Jersey Health Care Facilities Financing Authority, 7/10 at 101.00 BBB- 1,235,333
Revenue Bonds, Trinitas Hospital Obligated Group,
Series 2000, 7.500%, 7/01/30
New Jersey Turnpike Authority, Revenue Bonds, Series 1991C:
2,345 6.500%, 1/01/16 - MBIA Insured No Opt. Call AAA 2,863,902
655 6.500%, 1/01/16 - MBIA Insured No Opt. Call AAA 808,132
14,560 Tobacco Settlement Financing Corporation, New Jersey, 6/12 at 100.00 BBB 13,544,440
Tobacco Settlement Asset-Backed Bonds, Series 2002,
5.750%, 6/01/32
3,125 Tobacco Settlement Financing Corporation, New Jersey, 6/13 at 100.00 BBB 3,065,313
Tobacco Settlement Asset-Backed Bonds, Series 2003,
6.750%, 6/01/39
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK - 13.1% (8.5% OF TOTAL INVESTMENTS)
1,200 Hempstead Industrial Development Agency, New York, No Opt. Call A3 1,281,072
Resource Recovery Revenue Refunding Bonds, American
Ref-Fuel Company of Hempstead, Series 2001,
5.000%, 12/01/10 (Mandatory put 6/01/10)
New York City, New York, General Obligation Bonds,
Fiscal Series 1996F:
6,580 6.500%, 2/01/05 No Opt. Call A*** 6,660,013
7,730 6.500%, 2/01/05 No Opt. Call A 7,819,823
39
Nuveen Premium Income Municipal Fund 4, Inc. (NPT) (continued)
Portfolio of INVESTMENTS October 31, 2004
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK (continued)
New York City Transitional Finance Authority, New York, Future
Tax Secured Bonds, Fiscal Series 1998C:
$ 1,350 5.000%, 5/01/26 (Pre-refunded to 5/01/08) 5/08 at 101.00 AA+*** $ 1,490,562
35 5.000%, 5/01/26 (Pre-refunded to 5/01/08) 5/08 at 101.00 AA+*** 38,644
15,530 5.000%, 5/01/26 5/08 at 101.00 AA+ 15,878,338
New York City Transitional Finance Authority, New York, Future
Tax Secured Bonds, Fiscal Series 2000C:
3,630 5.875%, 11/01/16 (Pre-refunded to 5/15/10) 5/10 at 101.00 AA+*** 4,234,068
5,000 5.500%, 11/01/24 5/10 at 101.00 AA+ 5,499,600
220 New York City Transitional Finance Authority, New York, 5/10 at 101.00 AA+ 252,118
Future Tax Secured Bonds, Fiscal Series 2000A,
5.875%, 11/01/16
1,965 New York State Medical Care Facilities Finance Agency, 2/05 at 100.00 AAA 2,025,935
FHA-Insured Mortgage Revenue Bonds, Hospital and
Nursing Home Projects, Series 1992B, 6.200%, 8/15/22
4,200 New York State Medical Care Facilities Finance Agency, 2/05 at 102.00 AA 4,329,738
FHA-Insured Mortgage Revenue Bonds, Kenmore
Mercy Hospital, Series 1995B, 6.150%, 2/15/35
3,365 New York State Medical Care Facilities Finance Agency, 2/05 at 101.00 AA 3,443,438
FHA-Insured Hospital and Nursing Home Mortgage Revenue
Bonds, Series 1994A, 6.200%, 2/15/21
7,500 New York State Thruway Authority, General Revenue 1/05 at 102.00 AAA 7,704,600
Bonds, Series 1995C, 6.000%, 1/01/15 (Pre-refunded
to 1/01/05) - FGIC Insured
6,250 Port Authority of New York and New Jersey, Special Project No Opt. Call AAA 7,318,688
Bonds, JFK International Air Terminal LLC, Sixth Series 1997,
6.250%, 12/01/15 (Alternative Minimum Tax) - MBIA Insured
New York State Tobacco Settlement Financing Corporation, Tobacco
Settlement Asset-Backed and State Contingency Contract-Backed
Bonds, Series 2003A-1:
5,400 5.500%, 6/01/16 6/10 at 100.00 AA- 5,890,806
2,500 5.500%, 6/01/18 6/12 at 100.00 AA- 2,752,725
------------------------------------------------------------------------------------------------------------------------------------
NORTH CAROLINA - 3.2% (2.1% OF TOTAL INVESTMENTS)
2,675 Charlotte, North Carolina, Water and Sewer System Revenue 6/11 at 101.00 AAA 3,070,847
Bonds, Series 2001, 5.500%, 6/01/13
2,000 North Carolina Municipal Power Agency 1, Catawba Electric No Opt. Call AAA 2,324,060
Revenue Bonds, Series 1992, 6.000%, 1/01/11 -
MBIA Insured
10,000 North Carolina Municipal Power Agency 1, Catawba Electric 1/13 at 100.00 AAA 10,947,400
Revenue Bonds, Series 2003A, 5.250%, 1/01/18 -
MBIA Insured
2,445 North Carolina Infrastructure Finance Corporation, 2/14 at 100.00 AA+ 2,596,468
Certificates of Participation, Correctional Facilities,
Series 2004A, 5.000%, 2/01/21
------------------------------------------------------------------------------------------------------------------------------------
NORTH DAKOTA - 0.0% (0.0% OF TOTAL INVESTMENTS)
25 Minot, North Dakota, Single Family Mortgage Revenue 2/05 at 101.00 Aa2 25,174
Refunding Bonds, Series 1993, 7.700%, 8/01/10
------------------------------------------------------------------------------------------------------------------------------------
OHIO - 3.2% (2.1% OF TOTAL INVESTMENTS)
9,000 Cleveland, Ohio, Airport System Revenue Bonds, 1/10 at 101.00 AAA 9,183,690
Series 2000A, 5.000%, 1/01/31 - FSA Insured
3,000 Franklin County, Ohio, Development Revenue Bonds, 10/09 at 101.00 A 3,281,550
American Chemical Society, Series 1999, 5.800%, 10/01/14
1,000 Franklin County, Ohio, FHA-Insured Multifamily Housing 1/05 at 103.00 Aa 1,021,780
Mortgage Revenue Bonds, Hamilton Creek Apartments
Project, Series 1994A, 5.550%, 7/01/24 (Alternative
Minimum Tax)
550 Ohio Housing Finance Agency, GNMA Mortgage-Backed 3/05 at 102.00 Aaa 564,570
Securities Program Residential Mortgage Revenue Bonds,
Series 1995A-1, 6.300%, 9/01/17
4,370 Toledo, Ohio, General Obligation Bonds, Series 1994, 12/04 at 102.00 AAA 4,472,695
5.750%, 12/01/09 (Pre-refunded to 12/01/04) -
AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
OKLAHOMA - 2.1% (1.3% OF TOTAL INVESTMENTS)
480 Oklahoma Housing Finance Agency, Single Family Mortgage 3/10 at 101.00 Aaa 509,491
Revenue Bonds, Homeownership Loan Program,
Series 2000C-2, 6.200%, 9/01/28 (Alternative
Minimum Tax)
40
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
OKLAHOMA (continued)
Oklahoma County Finance Authority, Oklahoma, Multifamily Housing
First Mortgage Revenue Bonds, Multiple Apartments Project,
Series 1998A:
$ 3,495 7.000%, 4/01/18 # 4/06 at 102.00 N/R $ 34,950
7,000 7.125%, 4/01/28 # 4/06 at 102.00 N/R 70,000
9,735 Tulsa County Industrial Authority, Oklahoma, First Mortgage 3/11 at 101.00 N/R 7,648,011
Multifamily Housing Revenue Bonds, Stoneridge Apartments
Project, Series 1999, 6.125%, 3/01/39 (Alternative
Minimum Tax)
3,340 Tulsa Industrial Authority, Oklahoma, Hospital Revenue No Opt. Call AAA 3,878,742
Refunding Bonds, Hillcrest Medical Center, Series 1996,
6.500%, 6/01/09 - CONNIE LEE/AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
PENNSYLVANIA - 1.4% (0.9% OF TOTAL INVESTMENTS)
5,000 Pennsylvania Economic Development Financing Authority, 1/05 at 101.00 BBB- 5,099,450
Senior Lien Resource Recovery Revenue Bonds, Northampton
Generating Project, Series 1994A, 6.400%, 1/01/09
(Alternative Minimum Tax)
2,600 Pennsylvania Turnpike Commission, Turnpike Revenue 12/14 at 100.00 AAA 2,838,628
Bonds, Series 2004A, 5.500%, 12/01/31 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
PUERTO RICO - 3.3% (2.1% OF TOTAL INVESTMENTS)
12,390 Puerto Rico, Public Improvement General Obligation No Opt. Call AAA 15,363,600
Refunding Bonds, Series 1997, 6.500%, 7/01/13 -
MBIA Insured
3,470 University of Puerto Rico, University System Revenue Bonds, 6/10 at 100.00 AAA 3,952,746
Series 2000O, 5.750%, 6/01/18 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
RHODE ISLAND - 3.1% (2.0% OF TOTAL INVESTMENTS)
20,000 Rhode Island Tobacco Settlement Financing Corporation, 6/12 at 100.00 BBB 18,077,600
Tobacco Settlement Asset-Backed Bonds, Series 2002A,
6.250%, 6/01/42
------------------------------------------------------------------------------------------------------------------------------------
SOUTH CAROLINA - 3.5% (2.3% OF TOTAL INVESTMENTS)
3,000 Myrtle Beach, South Carolina, Hospitality and Accommodation 6/14 at 100.00 AAA 3,063,840
Fee Revenue Bonds, Series 2004A, 5.000%, 6/01/36 -
FGIC Insured
Piedmont Municipal Power Agency, South Carolina, Electric
Revenue Bonds, Series 1991:
5,000 6.250%, 1/01/21 - FGIC Insured No Opt. Call AAA 6,184,000
5,750 4.000%, 1/01/23 - MBIA Insured 1/05 at 100.00 AAA 5,392,005
5,085 Piedmont Municipal Power Agency, South Carolina, Electric No Opt. Call AAA 5,796,341
Revenue Refunding Bonds, Series 1998A, 5.500%, 1/01/13 -
MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
SOUTH DAKOTA - 0.3% (0.2% OF TOTAL INVESTMENTS)
1,750 South Dakota Health and Educational Facilities Authority, 11/14 at 100.00 A+ 1,828,733
Revenue Bonds, Sioux Valley Hospitals and Health System,
Series 2004A, 5.500%, 11/01/31
------------------------------------------------------------------------------------------------------------------------------------
TENNESSEE - 0.3% (0.2% OF TOTAL INVESTMENTS)
1,500 Metropolitan Government of Nashville and Davidson 5/08 at 102.00 AA 1,608,570
County, Tennessee, Electric System Revenue Bonds,
Series 1998A, 5.200%, 5/15/23
------------------------------------------------------------------------------------------------------------------------------------
TEXAS - 17.5% (11.2% OF TOTAL INVESTMENTS)
4,500 Alliance Airport Authority, Texas, Special Facilities Revenue 12/04 at 100.00 CCC 2,887,200
Bonds, American Airlines Inc., Series 1990,
7.500%, 12/01/29 (Alternative Minimum Tax)
3,345 Columbia-Brazoria Independent School District, Texas, 2/09 at 100.00 AAA 3,368,482
Unlimited Tax School Building Bonds, Series 1999,
4.750%, 2/01/25
8,000 Dallas-Ft. Worth International Airport, Texas, Joint Revenue 11/11 at 100.00 AAA 9,015,200
Refunding and Improvement Bonds, Series 2001A,
5.875%, 11/01/19 (Alternative Minimum Tax) - FGIC Insured
2,250 Dallas-Ft. Worth International Airport, Texas, Joint Revenue 11/14 at 100.00 AAA 2,282,558
Bonds, Series 2004B, 5.000%, 11/01/27 (Alternative
Minimum Tax) - FSA Insured
6,000 Garland Housing Finance Corporation, Texas, Multifamily 12/11 at 101.00 N/R 6,016,980
Housing Revenue Bonds, Legacy Pointe Apartments,
Series 2000, 7.500%, 6/01/40 (Alternative Minimum Tax)
7,000 Harris County Health Facilities Development Corporation, 11/13 at 100.00 AAA 7,137,620
Texas, Thermal Utility Revenue Bonds, TECO Project,
Series 2003, 5.000%, 11/15/30 - MBIA Insured
41
Nuveen Premium Income Municipal Fund 4, Inc. (NPT) (continued)
Portfolio of INVESTMENTS October 31, 2004
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
TEXAS (continued)
$ 28,305 Houston, Texas, Hotel Occupancy Tax and Special Revenue No Opt. Call AAA $ 8,115,044
Bonds, Convention and Entertainment Project,
Series 2001B, 0.000%, 9/01/28 - AMBAC Insured
7,500 Houston, Texas, Junior Lien Water and Sewerage System No Opt. Call AAA 8,846,700
Revenue Refunding Bonds, Series 2002A,
5.750%, 12/01/32 - FSA Insured
5,000 Houston, Texas, Junior Lien Water and Sewerage System 12/07 at 102.00 AAA 5,509,400
Revenue Refunding Bonds, Series 1997D, 5.000%, 12/01/25
(Pre-refunded to 12/01/07) - FGIC Insured
7,080 Liberty County Housing Development Corporation, Texas, 6/09 at 100.00 N/R 6,372,000
Multifamily Housing Revenue Bonds, Series 1999,
7.250%, 6/01/34
303 Midland Housing Finance Corporation, Texas, Single Family 11/05 at 103.00 Aaa 316,332
Mortgage Revenue Refunding Bonds, Series 1992A,
8.450%, 12/01/11
Montgomery Independent School District, Montgomery County, Texas,
Unlimited Tax School Building and Refunding Bonds, Series 2001:
2,300 5.500%, 2/15/21 2/11 at 100.00 AAA 2,561,855
2,400 5.500%, 2/15/23 2/11 at 100.00 AAA 2,655,360
Mt. Pleasant Independent School District, Titus County,
Texas, General Obligation Refunding Bonds, Series 2001:
3,025 5.000%, 2/15/26 8/11 at 100.00 Aaa 3,104,467
3,000 5.125%, 2/15/31 8/11 at 100.00 Aaa 3,085,170
6,000 Raven Hills Higher Education Corporation, Texas, Student 8/12 at 100.00 Aaa 6,212,040
Housing Revenue Bonds, Angelo State University -
Texan Hall LLC, Series 2002A, 5.000%, 8/01/25 -
MBIA Insured
3,410 Retama Development Corporation, Texas, Special Facilities 12/12 at 100.00 AAA 4,722,850
Revenue Bonds, Retama Park Racetrack Project, Series 1993,
8.750%, 12/15/18 (Pre-refunded to 12/15/12)
1,800 Sam Rayburn Municipal Power Agency, Texas, Power Supply 10/12 at 100.00 AA 1,987,578
System Revenue Refunding Bonds, Series 2002A,
5.750%, 10/01/21 - RAAI Insured
4,700 Spring Branch Independent School District, Harris County, 2/11 at 100.00 AAA 4,857,779
Texas, Limited Tax Schoolhouse and Refunding Bonds,
Series 2001, 5.125%, 2/01/26
4,150 Texas General Services Commission, Certificates of 3/05 at 100.50 A 4,217,064
Participation, Series 1992, 7.500%, 9/01/22
8,500 Travis County Health Facilities Development Corporation, 11/04 at 101.00 Aaa 8,819,685
Texas, Hospital Revenue Bonds, Daughters of Charity
National Health System, Series 1993B, 6.000%, 11/15/22
------------------------------------------------------------------------------------------------------------------------------------
UTAH - 6.4% (4.2% OF TOTAL INVESTMENTS)
4,845 Bountiful, Davis County, Utah, Hospital Revenue Refunding 12/08 at 101.00 N/R 4,408,562
Bonds, South Davis Community Hospital Project,
Series 1998, 5.750%, 12/15/18
17,570 Intermountain Power Agency, Utah, Power Supply Revenue 7/07 at 102.00 AAA 19,421,000
Refunding Bonds, Series 1997B, 5.750%, 7/01/19 -
MBIA Insured
Intermountain Power Agency, Utah, Power Supply Revenue
Bonds, Series 1996A:
5,065 6.150%, 7/01/14 7/06 at 102.00 A+*** 5,487,370
2,935 6.150%, 7/01/14 7/06 at 102.00 A+ 3,151,192
1,435 Salt Lake City and Sandy Metropolitan Water District, 7/14 at 100.00 Aaa 1,538,966
Utah, Water Revenue Bonds, Series 2004, 5.000%, 7/01/21
650 Utah Housing Finance Agency, Single Family Mortgage 7/10 at 100.00 AA 650,871
Bonds, Series 2000G, 5.875%, 7/01/27 (Alternative
Minimum Tax)
Utah Housing Finance Agency, Single Family Mortgage
Bonds, Series 2001C:
2,180 5.500%, 1/01/18 (Alternative Minimum Tax) 1/11 at 100.00 AA- 2,313,808
655 5.650%, 1/01/21 (Alternative Minimum Tax) 1/11 at 100.00 Aa2 684,285
------------------------------------------------------------------------------------------------------------------------------------
VIRGINIA - 1.4% (0.9% OF TOTAL INVESTMENTS)
8,190 Hampton, Virginia, Revenue Bonds, Convention Center 1/13 at 100.00 AAA 8,400,647
Project, Series 2002, 5.000%, 1/15/35 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
WASHINGTON - 9.6% (6.2% OF TOTAL INVESTMENTS)
1,855 Chelan County Public Utility District 1, Washington, Hydro 7/09 at 101.00 AA 1,981,752
Consolidated System Revenue Bonds, Series 1999A,
6.200%, 7/01/34 (Alternative Minimum Tax)
42
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
WASHINGTON (continued)
$ 1,035 Covington Water District, Washington, Water Improvement 3/05 at 100.00 AAA $ 1,050,070
and Revenue Refunding Bonds, Series 1995,
6.050%, 3/01/20 (Pre-refunded to 3/01/05) - AMBAC Insured
1,655 Everett, Washington, Limited Tax General Obligation Bonds, 9/07 at 100.00 Aaa 1,772,108
Series 1997, 5.125%, 9/01/17 - FSA Insured
1,626 Skagit County Housing Authority, Washington, GNMA 11/04 at 104.00 AAA 1,693,528
Collateralized Mortgage Loan Nursing Facility Revenue
Bonds, Sea Mar Community Project, Series 1993,
7.000%, 6/20/35
1,500 Snohomish County School District 6, Mukilteo, Washington, No Opt. Call AAA 1,748,265
Unlimited Tax General Obligation and Refunding Bonds,
Series 1993, 5.700%, 12/01/12 - FGIC Insured
8,155 Tacoma, Washington, Electric System Revenue Refunding 1/11 at 101.00 AAA 9,265,059
Bonds, Series 2001A, 5.750%, 1/01/20 - FSA Insured
4,705 Tacoma, Washington, Sewerage Revenue Refunding Bonds, No Opt. Call AAA 5,684,534
Series 1994B, 8.000%, 12/01/08 - FGIC Insured
4,870 Washington State Tobacco Settlement Authority, Tobacco 6/13 at 100.00 BBB 4,861,234
Settlement Asset-Backed Revenue Bonds, Series 2002,
6.500%, 6/01/26
2,000 Washington State Healthcare Facilities Authority, Revenue 8/08 at 102.00 AA 2,050,380
Bonds, Highline Community Hospital, Series 1998,
5.000%, 8/15/21 - RAAI Insured
1,000 Washington State Healthcare Facilities Authority, Revenue 8/13 at 102.00 AAA 1,023,650
Bonds, Harrison Memorial Hospital, Series 1998,
5.000%, 8/15/28 - AMBAC Insured
Washington Public Power Supply System, Revenue Refunding Bonds,
Nuclear Project 2, Series 1990A:
6,080 7.250%, 7/01/06 No Opt. Call Aaa 6,613,216
395 7.250%, 7/01/06 No Opt. Call Aaa 428,634
11,000 Washington Public Power Supply System, Nuclear Project 3 No Opt. Call Aaa 13,022,790
Revenue Refunding Bonds, Series 1993B, 7.000%, 7/01/09
4,700 Washington Public Power Supply System, Nuclear Project 3 7/08 at 102.00 Aaa 4,969,075
Revenue Refunding Bonds, Series 1998A, 5.125%, 7/01/18
------------------------------------------------------------------------------------------------------------------------------------
WISCONSIN - 1.3% (0.9% OF TOTAL INVESTMENTS)
7,500 Wisconsin Health and Educational Facilities Authority, 2/12 at 101.00 AAA 7,816,717
Revenue Bonds, Ministry Health Care Inc., Series 2002A,
5.250%, 2/15/32 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
$ 939,747 Total Long-Term Investments (cost $862,594,956) - 153.9% 900,558,274
=============-----------------------------------------------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS - 0.5% (0.3% OF TOTAL INVESTMENTS)
3,000 Palm Beach County Health Facilities Authority, Florida, VMIG-1 3,000,000
Revenue Bonds, Bethesda Healthcare System, Adjustable
Rate Demand Obligations, Series 2001, 1.740%, 12/01/31 +
------------------------------------------------------------------------------------------------------------------------------------
$ 3,000 Total Short-Term Investments (cost $3,000,000) 3,000,000
=============-----------------------------------------------------------------------------------------------------------------------
Total Investments (cost $865,594,956) - 154.4% 903,558,274
--------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 3.4% 20,126,176
--------------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (57.8)% (338,400,000)
--------------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 585,284,450
====================================================================================================================
(1) All percentages shown in the Portfolio of Investments
are based on net assets applicable to Common shares
unless otherwise noted.
* Optional Call Provisions (not covered by the report of
independent registered public accounting firm): Dates
(month and year) and prices of the earliest optional
call or redemption. There may be other call provisions
at varying prices at later dates.
** Ratings (not covered by the report of independent
registered public accounting firm): Using the higher of
Standard & Poor's or Moody's rating.
*** Securities are backed by an escrow or trust containing
sufficient U.S. Government or U.S. Government agency
securities which ensures the timely payment of
principal and interest. Such securities are normally
considered to be equivalent to AAA rated securities.
N/R Investment is not rated.
# Non-income producing security, in the case of a bond,
generally denotes that issuer has defaulted on the
payment of principal or interest or has filed for
bankruptcy. This security was sold subsequent to the
reporting period.
+ Security has a maturity of more than one year, but has
variable rate and demand features which qualify it as a
short-term security. The rate disclosed is that
currently in effect. This rate changes periodically
based on market conditions or a specified market index.
See accompanying notes to financial statements.
43
Statement of
ASSETS AND LIABILITIES October 31, 2004
PREMIUM INCOME PREMIUM INCOME 2 PREMIUM INCOME 4
(NPI) (NPM) (NPT)
------------------------------------------------------------------------------------------------------------------------------------
ASSETS
Investments, at market value (cost $1,394,994,020,
$903,950,450 and $865,594,956, respectively) $1,475,006,411 $959,576,390 $903,558,274
Cash 340,198 185,734 1,485,520
Receivables:
Interest 24,056,110 15,068,247 15,562,880
Investments sold 3,134,128 18,340,734 3,718,430
Other assets 63,368 42,074 94,752
------------------------------------------------------------------------------------------------------------------------------------
Total assets 1,502,600,215 993,213,179 924,419,856
------------------------------------------------------------------------------------------------------------------------------------
LIABILITIES
Payable for investments purchased 6,868,909 7,452,760 --
Accrued expenses:
Management fees 769,709 513,545 482,405
Other 315,143 203,812 189,799
Preferred share dividends payable 107,697 61,742 63,202
------------------------------------------------------------------------------------------------------------------------------------
Total liabilities 8,061,458 8,231,859 735,406
------------------------------------------------------------------------------------------------------------------------------------
Preferred shares, at liquidation value 525,000,000 347,000,000 338,400,000
------------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common shares $ 969,538,757 $637,981,320 $585,284,450
====================================================================================================================================
Common shares outstanding 63,785,430 41,093,661 43,236,703
====================================================================================================================================
Net asset value per Common share outstanding
(net assets applicable to Common shares,
divided by Common shares outstanding) $ 15.20 $ 15.53 $ 13.54
====================================================================================================================================
NET ASSETS APPLICABLE TO COMMON SHARES CONSIST OF:
------------------------------------------------------------------------------------------------------------------------------------
Common shares, $.01 par value per share $ 637,854 $ 410,937 $ 432,367
Paid-in surplus 901,328,041 570,811,783 587,114,585
Undistributed net investment income 9,737,131 6,806,263 4,797,353
Accumulated net realized gain (loss) from investments (22,176,660) 4,326,397 (45,023,173)
Net unrealized appreciation of investments 80,012,391 55,625,940 37,963,318
------------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common shares $ 969,538,757 $637,981,320 $585,284,450
====================================================================================================================================
Authorized shares:
Common 200,000,000 200,000,000 200,000,000
Preferred 1,000,000 1,000,000 1,000,000
====================================================================================================================================
See accompanying notes to financial statements.
44
Statement of
OPERATIONS Year Ended October 31, 2004
PREMIUM INCOME PREMIUM INCOME 2 PREMIUM INCOME 4
(NPI) (NPM) (NPT)
------------------------------------------------------------------------------------------------------------------------------------
INVESTMENT INCOME $76,184,333 $49,849,897 $48,227,555
------------------------------------------------------------------------------------------------------------------------------------
EXPENSES
Management fees 9,099,976 6,055,655 5,687,089
Preferred shares - auction fees 1,316,096 869,876 848,318
Preferred shares - dividend disbursing agent fees 60,163 60,163 80,220
Shareholders' servicing agent fees and expenses 196,800 69,212 96,905
Custodian's fees and expenses 292,435 196,291 178,869
Directors' fees and expenses 34,302 17,721 21,212
Professional fees 173,964 47,241 313,327
Shareholders' reports - printing and mailing expenses 136,248 100,159 92,232
Stock exchange listing fees 25,650 16,567 17,425
Investor relations expense 130,456 84,656 79,962
Other expenses 74,031 54,520 57,156
------------------------------------------------------------------------------------------------------------------------------------
Total expenses before custodian fee credit 11,540,121 7,572,061 7,472,715
Custodian fee credit (20,727) (12,175) (38,980)
------------------------------------------------------------------------------------------------------------------------------------
Net expenses 11,519,394 7,559,886 7,433,735
------------------------------------------------------------------------------------------------------------------------------------
Net investment income 64,664,939 42,290,011 40,793,820
------------------------------------------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN FROM INVESTMENTS
Net realized gain from investments 2,482,620 4,358,413 652,547
Change in net unrealized appreciation (depreciation) of investments 20,569,667 15,104,071 15,883,141
------------------------------------------------------------------------------------------------------------------------------------
Net gain from investments 23,052,287 19,462,484 16,535,688
------------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO PREFERRED SHAREHOLDERS
From net investment income (4,988,711) (3,250,596) (3,283,827)
------------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets applicable to Common shares from operations $ 82,728,515 $58,501,899 $54,045,681
====================================================================================================================================
See accompanying notes to financial statements.
45
Statement of
CHANGES IN NET ASSETS
PREMIUM INCOME (NPI) PREMIUM INCOME 2 (NPM) PREMIUM INCOME 4 (NPT)
----------------------------- ------------------------------ ----------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
10/31/04 10/31/03 10/31/04 10/31/03 10/31/04 10/31/03
------------------------------------------------------------------------------------------------------------------------------------
OPERATIONS
Net investment income $ 64,664,939 $ 66,922,169 $ 42,290,011 $ 44,271,502 $ 40,793,820 $ 40,340,813
Net realized gain (loss) from
investments 2,482,620 (6,491,900) 4,358,413 (393,349) 652,547 (24,848,241)
Change in net unrealized
appreciation (depreciation)
of investments 20,569,667 4,768,442 15,104,071 (3,831,125) 15,883,141 11,357,979
Distributions to Preferred
Shareholders:
From net investment income (4,988,711) (4,760,721) (3,250,596) (2,914,759) (3,283,827) (3,107,195)
From accumulated net realized
gains from investments -- -- -- (384,068) -- --
------------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets
applicable to Common shares
from operations 82,728,515 60,437,990 58,501,899 36,748,201 54,045,681 23,743,356
------------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO COMMON SHAREHOLDERS
From net investment income (61,501,952) (60,851,307) (40,436,175) (40,327,811) (37,551,098) (36,928,470)
From accumulated net realized
gains from investments -- -- -- (4,164,058) -- --
------------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets applicable
to Common shares from
distributions to
Common shareholders (61,501,952) (60,851,307) (40,436,175) (44,491,869) (37,551,098) (36,928,470)
------------------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS
Preferred shares offering costs -- -- -- -- 14,080 --
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease)
in net assets
applicable to Common shares 21,226,563 (413,317) 18,065,724 (7,743,668) 16,508,663 (13,185,114)
Net assets applicable to Common
shares at the beginning
of period 948,312,194 948,725,511 619,915,596 627,659,264 568,775,787 581,960,901
------------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common
shares at the end of period $969,538,757 $948,312,194 $637,981,320 $619,915,596 $585,284,450 $568,775,787
====================================================================================================================================
Undistributed net investment
income at the end of period $ 9,737,131 $ 11,705,610 $ 6,806,263 $ 8,474,976 $ 4,797,353 $ 4,870,416
====================================================================================================================================
See accompanying notes to financial statements.
46
Notes to
FINANCIAL STATEMENTS
1. GENERAL INFORMATION AND SIGNIFICANT ACCOUNTING POLICIES
The funds (the "Funds") covered in this report and their corresponding Common
share New York Stock Exchange symbols are Nuveen Premium Income Municipal Fund,
Inc. (NPI), Nuveen Premium Income Municipal Fund 2, Inc. (NPM) and Nuveen
Premium Income Municipal Fund 4, Inc. (NPT). The Funds are registered under the
Investment Company Act of 1940, as amended, as closed-end, diversified
management investment companies.
Each Fund seeks to provide current income exempt from regular federal income tax
by investing primarily in a diversified portfolio of municipal obligations
issued by state and local government authorities.
The following is a summary of significant accounting policies followed by the
Funds in the preparation of their financial statements in accordance with U.S.
generally accepted accounting principles.
Securities Valuation
The prices of municipal bonds in each Fund's investment portfolio are provided
by a pricing service approved by the Fund's Board of Directors. When price
quotes are not readily available (which is usually the case for municipal
securities), the pricing service establishes fair market value based on yields
or prices of municipal bonds of comparable quality, type of issue, coupon,
maturity and rating, indications of value from securities dealers, evaluations
of anticipated cash flows or collateral and general market conditions. If it is
determined that market prices for a security are unavailable or inappropriate,
the Board of Directors of the Funds, or its designee, may establish a fair value
for the security. Temporary investments in securities that have variable rate
and demand features qualifying them as short-term securities are valued at
amortized cost, which approximates market value.
Securities Transactions
Securities transactions are recorded on a trade date basis. Realized gains and
losses from such transactions are determined on the specific identification
method. Securities purchased or sold on a when-issued or delayed delivery basis
may have extended settlement periods. The securities so purchased are subject to
market fluctuation during this period. The Funds have instructed the custodian
to segregate assets with a current value at least equal to the amount of the
when-issued and delayed delivery purchase commitments. At October 31, 2004,
Premium Income (NPI) and Premium Income 2 (NPM) had outstanding when-issued
purchase commitments of $6,868,909 and $7,452,760, respectively. There were no
such outstanding purchase commitments in Premium Income 4 (NPT).
Investment Income
Interest income, which includes the amortization of premiums and accretion of
discounts for financial reporting purposes, is recorded on an accrual basis.
Investment income also includes paydown gains and losses, if any.
Professional Fees
Professional fees presented in the Statement of Operations consist of legal fees
incurred in the normal course of operations, audit fees, tax consulting fees
and, in some cases, workout expenditures. Workout expenditures are incurred in
an attempt to protect or enhance an investment, or to pursue other claims or
legal actions on behalf of Fund shareholders.
Federal Income Taxes
Each Fund is a separate taxpayer for federal income tax purposes. Each Fund
intends to distribute all net investment income and net capital gains to
shareholders and to otherwise comply with the requirements of Subchapter M of
the Internal Revenue Code applicable to regulated investment companies.
Therefore, no federal income tax provision is required. Furthermore, each Fund
intends to satisfy conditions which will enable interest from municipal
securities, which is exempt from regular federal income tax, to retain such
tax-exempt status when distributed to shareholders of the Funds. All monthly
tax-exempt income dividends paid during the fiscal year ended October 31, 2004,
have been designated Exempt Interest Dividends. Net realized capital gains and
ordinary income distributions made by the Funds are subject to federal taxation.
Dividends and Distributions to Common Shareholders
Dividends from tax-exempt net investment income are declared monthly. Net
realized capital gains and/or market discount from investment transactions, if
any, are distributed to shareholders not less frequently than annually.
Furthermore, capital gains are distributed only to the extent they exceed
available capital loss carryforwards.
47
Notes to
FINANCIAL STATEMENTS (continued)
Distributions to Common shareholders of tax-exempt net investment income, net
realized capital gains and/or market discount, if any, are recorded on the
ex-dividend date. The amount and timing of distributions are determined in
accordance with federal income tax regulations, which may differ from U.S.
generally accepted accounting principles.
Preferred Shares
The Funds have issued and outstanding Preferred shares, $25,000 stated value per
share, as a means of effecting financial leverage. Each Fund's Preferred shares
are issued in more than one Series. The dividend rate on each Series is
determined every seven days, pursuant to a dutch auction process overseen by the
auction agent, and is payable weekly at the end of each rate period. The number
of Preferred shares outstanding, by Series and in total, for each Fund is as
follows:
PREMIUM PREMIUM PREMIUM
INCOME INCOME 2 INCOME 4
(NPI) (NPM) (NPT)
--------------------------------------------------------------------------------
Number of shares:
Series M 3,800 2,000 2,200
Series M2 2,000 -- --
Series T 3,800 3,000 2,000
Series T2 -- -- 1,328
Series W 3,800 2,000 1,680
Series W2 -- -- 520
Series TH 3,800 3,000 2,680
Series F 3,800 2,000 1,800
Series F2 -- 1,880 1,328
--------------------------------------------------------------------------------
Total 21,000 13,880 13,536
================================================================================
Derivative Financial Instruments
The Funds may invest in certain derivative financial instruments including
futures, forward, swap and option contracts, and other financial instruments
with similar characteristics. Although the Funds are authorized to invest in
such financial instruments, and may do so in the future, they did not make any
such investments during the fiscal year ended October 31, 2004.
Custodian Fee Credit
Each Fund has an arrangement with the custodian bank whereby certain custodian
fees and expenses are reduced by credits earned on each Fund's cash on deposit
with the bank. Such deposit arrangements are an alternative to overnight
investments.
Indemnifications
Under the Funds' organizational documents, its Officers and Directors are
indemnified against certain liabilities arising out of the performance of their
duties to the Funds. In addition, in the normal course of business, the Funds
enter into contracts that provide general indemnifications to other parties. The
Funds' maximum exposure under these arrangements is unknown as this would
involve future claims that may be made against the Funds that have not yet
occurred. However, the Funds have not had prior claims or losses pursuant to
these contracts and expect the risk of loss to be remote.
Use of Estimates
The preparation of financial statements in conformity with U.S. generally
accepted accounting principles, requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities at the
date of the financial statements and the reported amounts of increases and
decreases in net assets applicable to Common shares from operations during the
reporting period. Actual results may differ from those estimates.
48
2. FUND SHARES
None of the Funds engaged in transactions in their own shares during the fiscal
years ended October 31, 2004 and October 31, 2003.
3. SECURITIES TRANSACTIONS
Purchases and sales (including maturities) of investments in long-term municipal
securities during the fiscal year ended October 31, 2004, were as follows:
PREMIUM PREMIUM PREMIUM
INCOME INCOME 2 INCOME 4
(NPI) (NPM) (NPT)
--------------------------------------------------------------------------------
Purchases $255,627,321 $216,964,477 $69,711,189
Sales and maturities 249,688,208 232,943,867 54,395,579
================================================================================
4. INCOME TAX INFORMATION
The following information is presented on an income tax basis. Differences
between amounts for financial statement and federal income tax purposes are
primarily due to the treatment of paydown gains and losses on investments,
timing differences in recognizing income on taxable market discount securities
and timing differences in recognizing certain gains and losses on security
transactions.
At October 31, 2004, the cost of investments was as follows:
PREMIUM PREMIUM PREMIUM
INCOME INCOME 2 INCOME 4
(NPI) (NPM) (NPT)
--------------------------------------------------------------------------------
Cost of investments $1,393,980,980 $903,612,498 $864,889,110
================================================================================
Gross unrealized appreciation and gross unrealized depreciation of investments
at October 31, 2004, were as follows:
PREMIUM PREMIUM PREMIUM
INCOME INCOME 2 INCOME 4
(NPI) (NPM) (NPT)
-------------------------------------------------------------------------------
Gross unrealized:
Appreciation $ 94,983,753 $56,837,820 $ 54,442,373
Depreciation (13,958,322) (873,928) (15,773,209)
-------------------------------------------------------------------------------
Net unrealized appreciation
of investments $ 81,025,431 $55,963,892 $ 38,669,164
===============================================================================
The tax components of undistributed net investment income and net realized gains
at October 31, 2004, were as follows:
PREMIUM PREMIUM PREMIUM
INCOME INCOME 2 INCOME 4
(NPI) (NPM) (NPT)
--------------------------------------------------------------------------------
Undistributed net tax-exempt income * $13,928,174 $9,752,477 $7,067,130
Undistributed net ordinary income ** 6,449 126,711 157,396
Undistributed net long-term capital gains -- 4,326,397 --
================================================================================
* Undistributed net tax-exempt income (on a tax basis) has not been reduced
for the dividend declared on October 1, 2004, paid on November 1, 2004.
** Net ordinary income consists of taxable market discount income and net
short-term capital gains, if any.
The tax character of distributions paid during the fiscal years ended October
31, 2004 and October 31, 2003, was designated for purposes of the dividends paid
deduction as follows:
PREMIUM PREMIUM PREMIUM
INCOME INCOME 2 INCOME 4
2004 (NPI) (NPM) (NPT)
---------------------------------------------------------------------------------------
Distributions from net tax-exempt income $66,130,210 $43,384,403 $40,023,013
Distributions from net ordinary income ** 287,221 262,847 770,605
Distributions from net long-term capital gains -- -- --
=======================================================================================
PREMIUM PREMIUM PREMIUM
INCOME INCOME 2 INCOME 4
2003 (NPI) (NPM) (NPT)
---------------------------------------------------------------------------------------
Distributions from net tax-exempt income $65,547,346 $43,115,363 $39,962,183
Distributions from net ordinary income ** -- 153,898 100,446
Distributions from net long-term capital gains -- 4,545,182 --
=======================================================================================
** Net ordinary income consists of taxable market discount income and net
short-term capital gains, if any.
49
Notes to
FINANCIAL STATEMENTS (continued)
At October 31, 2004, the following Funds had unused capital loss carryforwards
available for federal income tax purposes to be applied against future capital
gains, if any. If not applied, the carryforwards will expire as follows:
PREMIUM PREMIUM
INCOME INCOME 4
(NPI) (NPT)
--------------------------------------------------------------------------------
Expiration year:
2008 $ 9,710,067 $ 2,151,015
2009 -- --
2010 6,203,091 18,079,555
2011 6,263,502 24,792,603
--------------------------------------------------------------------------------
Total $22,176,660 $45,023,173
================================================================================
5. MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES
As approved by the Board of Directors, effective August 1, 2004, a complex-wide
management fee structure was adopted for all funds sponsored by Nuveen Advisory
Corp. (the "Adviser"), a wholly owned subsidiary of Nuveen Investments, Inc. and
its affiliates. This fee structure separates each fund's management fee into two
components - a complex-level component, based on the aggregate amount of all
funds assets managed by the Adviser and its affiliates, and a specific
fund-level component, based only on the amount of assets within each individual
fund. This pricing structure enables Nuveen fund shareholders to benefit from
growth in the assets within each individual fund as well as from growth in the
amount of complex-wide assets managed by the Adviser and its affiliates. Under
no circumstances will this pricing structure result in a fund paying management
fees at a rate higher than would otherwise have been applicable had the
complex-wide management fee structure not been implemented. As a consequence of
this new management fee structure, the funds' effective management fees were
reduced by approximately .006% as of November 30, 2004.
Effective August 1, 2004, the annual fund-level fee, payable monthly, for each
of the Funds is based upon the average daily net assets (including net assets
attributable to Preferred shares) of each Fund as follows:
AVERAGE DAILY NET ASSETS (INCLUDING NET ASSETS
ATTRIBUTABLE TO PREFERRED SHARES) FUND-LEVEL FEE RATE
--------------------------------------------------------------------------------
For the first $125 million .4500%
For the next $125 million .4375
For the next $250 million .4250
For the next $500 million .4125
For the next $1 billion .4000
For the next $3 billion .3875
For net assets over $5 billion .3750
================================================================================
Effective August 1, 2004, the annual complex-level fee, payable monthly, which
is additive to the fund-level fee, for all Nuveen sponsored funds in the U.S.,
is based on the aggregate amount of total fund assets managed as follows:
COMPLEX-LEVEL ASSETS(1) COMPLEX-LEVEL FEE RATE
--------------------------------------------------------------------------------
For the first $55 billion .2000%
For the next $1 billion .1800
For the next $1 billion .1600
For the next $3 billion .1425
For the next $3 billion .1325
For the next $3 billion .1250
For the next $5 billion .1200
For the next $5 billion .1175
For the next $15 billion .1150
For Managed Assets over $91 billion (2) .1400
================================================================================
50
(1) The complex-level fee component of the management fee for the funds is
calculated based upon the aggregate Managed Assets ("Managed Assets" means
the average daily net assets of each fund including assets attributable to
all types of leverage used by the Nuveen funds) of Nuveen-sponsored funds
in the U.S.
(2) With respect to the complex-wide Managed Assets over $91 billion, the fee
rate or rates that will apply to such assets will be determined at a later
date. In the unlikely event that complex-wide Managed Assets reach $91
billion prior to a determination of the complex-level fee rate or rates to
be applied to Managed Assets in excess of $91 billion, the complex-level
fee rate for such complex-wide Managed Assets shall be .1400% until such
time as a different rate or rates is determined.
Each Fund paid through July 31, 2004, an annual management fee, payable monthly,
at the rates set forth below, which were based upon the average daily net assets
(including net assets attributable to Preferred shares) of each Fund as follows:
AVERAGE DAILY NET ASSETS (INCLUDING NET ASSETS
ATTRIBUTABLE TO PREFERRED SHARES) MANAGEMENT FEE RATE
--------------------------------------------------------------------------------
For the first $125 million .6500%
For the next $125 million .6375
For the next $250 million .6250
For the next $500 million .6125
For the next $1 billion .6000
For the next $3 billion .5875
For net assets over $5 billion .5750
================================================================================
The management fee compensates the Adviser for overall investment advisory and
administrative services and general office facilities. The Funds pay no
compensation directly to those of its Directors who are affiliated with the
Adviser or to their officers, all of whom receive remuneration for their
services to the Funds from the Adviser or its affiliates. The Board of Directors
has adopted a deferred compensation plan for independent Directors that enables
Directors to elect to defer receipt of all or a portion of the annual
compensation they are entitled to receive from certain Nuveen advised Funds.
Under the plan, deferred amounts are treated as though equal dollar amounts had
been invested in shares of select Nuveen advised Funds.
6. SUBSEQUENT EVENT - DISTRIBUTIONS TO COMMON SHAREHOLDERS
The Funds declared Common share dividend distributions from their tax-exempt net
investment income which were paid on December 1, 2004, to shareholders of record
on November 15, 2004, as follows:
PREMIUM PREMIUM PREMIUM
INCOME INCOME 2 INCOME 4
(NPI) (NPM) (NPT)
--------------------------------------------------------------------------------
Dividend per share $.0800 $.0815 $.0710
================================================================================
51
Financial
HIGHLIGHTS
Selected data for a Common share outstanding throughout each year:
Investment Operations Less Distributions
----------------------------------------------------------------- -------------------------------
Distributions Distributions
from Net from Net
Beginning Net Investment Capital Investment Capital
Common Realized/ Income to Gains to Income to Gains to
Share Net Unrealized Preferred Preferred Common Common
Net Asset Investment Investment Share- Share- Share- Share-
Value Income Gain (Loss) holders+ holders+ Total holders holders Total
====================================================================================================================================
PREMIUM INCOME (NPI)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2004 $14.87 $1.01 $ .36 $(.08) $ -- $ 1.29 $(.96) $ -- $ (.96)
2003 14.87 1.05 (.03) (.07) -- .95 (.95) -- (.95)
2002 15.27 1.10 (.48) (.11) -- .51 (.91) -- (.91)
2001 14.23 1.12 .98 (.26) -- 1.84 (.80) -- (.80)
2000 13.46 1.11 .78 (.33) -- 1.56 (.79) -- (.79)
PREMIUM INCOME 2 (NPM)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2004 15.09 1.02 .48 (.08) -- 1.42 (.98) -- (.98)
2003 15.27 1.08 (.10) (.07) (.01) .90 (.98) (.10) (1.08)
2002 15.53 1.17 (.30) (.11) (.01) .75 (.96) (.05) (1.01)
2001 14.75 1.21 .73 (.27) -- 1.67 (.89) -- (.89)
2000 14.61 1.22 .20 (.34) -- 1.08 (.92) (.02) (.94)
PREMIUM INCOME 4 (NPT)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2004 13.15 .94 .40 (.08) -- 1.26 (.87) -- (.87)
2003 13.46 .93 (.32) (.07) -- .54 (.85) -- (.85)
2002 14.22 1.00 (.80) (.11) -- .09 (.85) -- (.85)
2001 13.54 1.08 .66 (.25) -- 1.49 (.81) -- (.81)
2000 13.50 1.11 .07 (.32) -- .86 (.82) -- (.82)
====================================================================================================================================
Total Returns
--------------------
Based
Ending on
Common Based Common
Share Ending on Share Net
Net Asset Market Market Asset
Value Value Value* Value*
========================================================================
PREMIUM INCOME (NPI)
------------------------------------------------------------------------
Year Ended 10/31:
2004 $15.20 $14.3000 8.82% 9.00%
2003 14.87 14.0600 6.48 6.58
2002 14.87 14.1100 5.51 3.47
2001 15.27 14.2500 26.60 13.22
2000 14.23 11.9375 4.10 12.03
PREMIUM INCOME 2 (NPM)
------------------------------------------------------------------------
Year Ended 10/31:
2004 15.53 14.5700 9.48 9.77
2003 15.09 14.2500 6.57 6.07
2002 15.27 14.4000 5.59 5.03
2001 15.53 14.6100 17.31 11.63
2000 14.75 13.2500 (2.03) 7.71
PREMIUM INCOME 4 (NPT)
------------------------------------------------------------------------
Year Ended 10/31:
2004 13.54 12.7400 8.98 9.90
2003 13.15 12.5200 3.09 4.12
2002 13.46 12.9700 .52 .76
2001 14.22 13.7500 18.68 11.28
2000 13.54 12.3125 3.28 6.58
========================================================================
Ratios/Supplemental Data
----------------------------------------------------------------------------------------------
Before Credit After Credit**
------------------------------ ------------------------------
Ratio of Net Ratio of Net
Ratio of Investment Ratio of Investment
Ending Expenses Income to Expenses Income to
Net to Average Average to Average Average
Assets Net Assets Net Assets Net Assets Net Assets
Applicable Applicable Applicable Applicable Applicable Portfolio
to Common to Common to Common to Common to Common Turnover
Shares (000) Shares++ Shares++ Shares++ Shares++ Rate
========================================================================================================================
PREMIUM INCOME (NPI)
------------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2004 $969,539 1.21% 6.76% 1.20% 6.76% 17%
2003 948,312 1.22 7.02 1.22 7.02 24
2002 948,726 1.22 7.39 1.22 7.39 4
2001 974,272 1.22 7.49 1.21 7.50 20
2000 907,640 1.28 8.09 1.27 8.10 18
PREMIUM INCOME 2 (NPM)
------------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2004 637,981 1.21 6.75 1.21 6.76 23
2003 619,916 1.22 7.06 1.21 7.07 21
2002 627,659 1.22 7.70 1.21 7.71 21
2001 638,365 1.23 7.93 1.21 7.95 12
2000 605,973 1.23 8.38 1.22 8.39 7
PREMIUM INCOME 4 (NPT)
------------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2004 585,284 1.30 7.10 1.29 7.10 6
2003 568,776 1.36 6.95 1.35 6.96 17
2002 581,961 1.36 7.36 1.35 7.37 16
2001 614,989 1.34 7.73 1.33 7.74 10
2000 585,387 1.27 8.22 1.26 8.23 14
========================================================================================================================
Preferred Shares at End of Period
------------------------------------------
Aggregate Liquidation
Amount and Market Asset
Outstanding Value Coverage
(000) Per Share Per Share
====================================================================
PREMIUM INCOME (NPI)
--------------------------------------------------------------------
Year Ended 10/31:
2004 $525,000 $25,000 $71,169
2003 525,000 25,000 70,158
2002 525,000 25,000 70,177
2001 525,000 25,000 71,394
2000 525,000 25,000 68,221
PREMIUM INCOME 2 (NPM)
--------------------------------------------------------------------
Year Ended 10/31:
2004 347,000 25,000 70,964
2003 347,000 25,000 69,663
2002 347,000 25,000 70,220
2001 347,000 25,000 70,992
2000 347,000 25,000 68,658
PREMIUM INCOME 4 (NPT)
--------------------------------------------------------------------
Year Ended 10/31:
2004 338,400 25,000 68,239
2003 338,400 25,000 67,019
2002 338,400 25,000 67,983
2001 338,400 25,000 70,434
2000 338,400 25,000 68,247
====================================================================
* Total Investment Return on Market Value is the combination of changes in
the market price per share and the effect of reinvested dividend income and
reinvested capital gains distributions, if any, at the average price paid
per share at the time of reinvestment. Total Return on Common Share Net
Asset Value is the combination of changes in Common Share net asset value,
reinvested dividend income at net asset value and reinvested capital gains
distributions at net asset value, if any. Total returns are not annualized.
** After custodian fee credit, where applicable.
+ The amounts shown are based on Common share equivalents.
++ Ratios do not reflect the effect of dividend payments to Preferred
shareholders; income ratios reflect income earned on assets attributable to
Preferred shares.
See accompanying notes to financial statements.
52-53 SPREAD
Board Members
AND OFFICERS
The management of the Funds, including general supervision of the duties
performed for the Funds by the Adviser, is the responsibility of the Board
Members of the Funds. The number of board members of the Funds is currently set
at seven. None of the board members who are not "interested" persons of the
Funds has ever been a director or employee of, or consultant to, Nuveen or its
affiliates. The names and business addresses of the board members and officers
of the Funds, their principal occupations and other affiliations during the past
five years, the number of portfolios each oversees and other directorships they
hold are set forth below.
NUMBER OF
PORTFOLIOS IN
POSITION(S) YEAR FIRST PRINCIPAL OCCUPATION(S) FUND COMPLEX
NAME, BIRTHDATE HELD WITH ELECTED OR INCLUDING OTHER DIRECTORSHIPS OVERSEEN BY
AND ADDRESS THE FUNDS APPOINTED(2) DURING PAST 5 YEARS BOARD MEMBER
------------------------------------------------------------------------------------------------------------------------------------
BOARD MEMBER WHO IS AN INTERESTED PERSON OF THE FUNDS:
------------------------------------------------------------------------------------------------------------------------------------
Timothy R. Schwertfeger (1) Chairman of 1994 Chairman and Director (since 1996) of Nuveen Investments, 152
3/28/49 the Board Inc. and Nuveen Investments, LLC; Director (since 1992) and
333 W. Wacker Drive and Trustee Chairman (since 1996) of Nuveen Advisory Corp. and Nuveen
Chicago, IL 60606 Institutional Advisory Corp.; Chairman and Director (since
1997) of Nuveen Asset Management Inc.; Director (since
1996) of Institutional Capital Corporation; Chairman and
Director (since 1999) of Rittenhouse Asset Management, Inc.;
Chairman of Nuveen Investments Advisers Inc. (since 2002).
BOARD MEMBERS WHO ARE NOT INTERESTED PERSONS OF THE FUNDS:
------------------------------------------------------------------------------------------------------------------------------------
Robert P. Bremner Board member 1997 Private Investor and Management Consultant. 152
8/22/40
333 W. Wacker Drive
Chicago, IL 60606
------------------------------------------------------------------------------------------------------------------------------------
Lawrence H. Brown Board member 1993 Retired (1989) as Senior Vice President of The Northern 152
7/29/34 Trust Company; Director, Community Advisory Board for
333 W. Wacker Drive Highland Park and Highwood, United Way of the North
Chicago, IL 60606 Shore (since 2002).
------------------------------------------------------------------------------------------------------------------------------------
Jack B. Evans Board member 1999 President, The Hall-Perrine Foundation, a private philanthropic 152
10/22/48 corporation (since 1996); Director and Vice Chairman, United
333 W. Wacker Drive Fire & Casualty Company; formerly Director, Federal Reserve
Chicago, IL 60606 Bank of Chicago; formerly, President and Chief Operating
Officer, SCI Financial Group, Inc., a regional financial
services firm.
------------------------------------------------------------------------------------------------------------------------------------
William C. Hunter Board member 2004 Dean and Distinguished Professor of Finance, School of 152
3/6/48 Business at the University of Connecticut (since 2003);
333 W. Wacker Drive previously Senior Vice President and Director of Research
Chicago, IL 60606 at the Federal Reserve Bank of Chicago (1995-2003);
Director, Credit Research Center at Georgetown University;
Director of Xerox Corporation (since 2004).
54
NUMBER OF
PORTFOLIOS IN
POSITION(S) YEAR FIRST PRINCIPAL OCCUPATION(S) FUND COMPLEX
NAME, BIRTHDATE HELD WITH ELECTED OR INCLUDING OTHER DIRECTORSHIPS OVERSEEN BY
AND ADDRESS THE FUNDS APPOINTED(2) DURING PAST 5 YEARS BOARD MEMBER
------------------------------------------------------------------------------------------------------------------------------------
BOARD MEMBERS WHO ARE NOT INTERESTED PERSONS OF THE FUNDS (CONTINUED):
------------------------------------------------------------------------------------------------------------------------------------
William J. Schneider Board member 1997 Senior Partner and Chief Operating Officer, Miller-Valentine 152
9/24/44 Group, Vice President, Miller-Valentine Realty, a construction
333 W. Wacker Drive company; Chair, Miami Valley Hospital; Chair, Dayton
Chicago, IL 60606 Development Coalition; formerly, Member, Community
Advisory Board, National City Bank, Dayton, Ohio and
Business Advisory Council, Cleveland Federal Reserve Bank.
------------------------------------------------------------------------------------------------------------------------------------
Judith M. Stockdale Board member 1997 Executive Director, Gaylord and Dorothy Donnelley 152
12/29/47 Foundation (since 1994); prior thereto, Executive Director,
333 W. Wacker Drive Great Lakes Protection Fund (from 1990 to 1994)
Chicago, IL 60606
NUMBER OF
PORTFOLIOS IN
POSITION(S) YEAR FIRST FUND COMPLEX
NAME, BIRTHDATE HELD WITH ELECTED OR PRINCIPAL OCCUPATION(S) OVERSEEN BY
AND ADDRESS THE FUNDS APPOINTED(3) DURING PAST 5 YEARS OFFICER
------------------------------------------------------------------------------------------------------------------------------------
OFFICERS OF THE FUNDS:
------------------------------------------------------------------------------------------------------------------------------------
Gifford R. Zimmerman Chief 1988 Managing Director (since 2002), Assistant Secretary and 152
9/9/56 Administrative Associate General Counsel, formerly, Vice President and
333 W. Wacker Drive Officer Assistant General Counsel of Nuveen Investments, LLC;
Chicago, IL 60606 Managing Director (since 2002), General Counsel and
Assistant Secretary, formerly, Vice President of Nuveen
Advisory Corp. and Nuveen Institutional Advisory Corp.;
Managing Director (since 2002), Assistant Secretary and
Associate General Counsel, formerly, Vice President
(since 2000), of Nuveen Asset Management Inc.; Managing
Director (since 2004) and Assistant Secretary (since 1994)
of Nuveen Investments Inc.; Assistant Secretary of NWQ
Investment Management Company, LLC (since 2002); Vice
President and Assistant Secretary of Nuveen Investments
Advisers Inc. (since 2002); Managing Director, Associate
General Counsel and Assistant Secretary of Rittenhouse
Asset Management, Inc. (since 2003); Chartered
Financial Analyst.
------------------------------------------------------------------------------------------------------------------------------------
Julia L. Antonatos Vice President 2004 Vice President (since 2002), formerly, Assistant Vice President 152
9/22/63 (since 1999) of Nuveen Investments, LLC; Chartered
333 W. Wacker Drive Financial Analyst.
Chicago, IL 60606
------------------------------------------------------------------------------------------------------------------------------------
Michael T. Atkinson Vice President 2000 Vice President (since 2002), formerly, Assistant Vice 152
2/3/66 and Assistant President (since 2000), previously, Associate of Nuveen
333 W. Wacker Drive Secretary Investments, LLC.
Chicago, IL 60606.
55
Board Members
AND OFFICERS (CONTINUED)
NUMBER OF
PORTFOLIOS IN
POSITION(S) YEAR FIRST FUND COMPLEX
NAME, BIRTHDATE HELD WITH ELECTED OR PRINCIPAL OCCUPATION(S) OVERSEEN BY
AND ADDRESS THE FUNDS APPOINTED(3) DURING PAST 5 YEARS OFFICER
------------------------------------------------------------------------------------------------------------------------------------
OFFICERS OF THE FUNDS (CONTINUED):
------------------------------------------------------------------------------------------------------------------------------------
Peter H. D'Arrigo Vice President 1999 Vice President of Nuveen Investments, LLC (since 1999), 152
11/28/67 and Treasurer prior thereto, Assistant Vice President (since 1997); Vice
333 W. Wacker Drive President and Treasurer of Nuveen Investments, Inc. (since
Chicago, IL 60606 1999); Vice President and Treasurer of Nuveen Advisory Corp.
and Nuveen Institutional Advisory Corp (since 1999); Vice
President and Treasurer of Nuveen Asset Management Inc.
(since 2002) and of Nuveen Investments Advisers Inc. (since
2002); Assistant Treasurer of NWQ Investment Management
Company, LLC (since 2002); Vice President and Treasurer of
Nuveen Rittenhouse Asset Management, Inc. (since 2003);
Chartered Financial Analyst.
------------------------------------------------------------------------------------------------------------------------------------
Jessica R. Droeger Vice President 2000 Vice President (since 2002) and Assistant General Counsel 152
9/24/64 and Secretary (since 1998); formerly, Assistant Vice President (since 1998)
333 W. Wacker Drive of Nuveen Investments, LLC; Vice President (since 2002)
Chicago, IL 60606 and Assistant Secretary (since 1998), formerly Assistant
Vice President of Nuveen Advisory Corp. and Nuveen
Institutional Advisory Corp.
------------------------------------------------------------------------------------------------------------------------------------
Lorna C. Ferguson Vice President 1998 Managing Director (since 2004) formerly, Vice President of 152
10/24/45 Nuveen Investments, LLC; Managing Director (since 2004)
333 W. Wacker Drive formerly, Vice President (since 1998) of Nuveen Advisory
Chicago, IL 60606 Corp. and Nuveen Institutional Advisory Corp.
------------------------------------------------------------------------------------------------------------------------------------
William M. Fitzgerald Vice President 1995 Managing Director (since 2002) of Nuveen Investments, 152
3/2/64 LLC; Managing Director (since 2001), formerly Vice President
333 W. Wacker Drive of Nuveen Advisory Corp. and Nuveen Institutional Advisory
Chicago, IL 60606 Corp. (since 1995); Managing Director of Nuveen Asset
Management Inc. (since 2001); Vice President of Nuveen
Investment Advisers Inc. (since 2002); Chartered
Financial Analyst.
------------------------------------------------------------------------------------------------------------------------------------
Stephen D. Foy Vice President 1998 Vice President (since 1993) and Funds Controller (since 1998) 152
5/31/54 and Controller of Nuveen Investments, LLC; formerly, Vice President and
333 W. Wacker Drive Funds Controller (1998-2003) of Nuveen Investments, Inc.;
Chicago, IL 60606 Certified Public Accountant.
56
NUMBER OF
PORTFOLIOS IN
POSITION(S) YEAR FIRST FUND COMPLEX
NAME, BIRTHDATE HELD WITH ELECTED OR PRINCIPAL OCCUPATION(S) OVERSEEN BY
AND ADDRESS THE FUNDS APPOINTED(3) DURING PAST 5 YEARS OFFICER
------------------------------------------------------------------------------------------------------------------------------------
OFFICERS OF THE FUNDS (CONTINUED):
------------------------------------------------------------------------------------------------------------------------------------
James D. Grassi Vice President 2004 Vice President and Deputy Director of Compliance 152
4/13/56 and Chief (since August 2004) of Nuveen Investments, LLC,
333 W. Wacker Drive Compliance Nuveen Investments Advisers Inc., Nuveen Asset
Chicago, IL 60606 Officer Management Inc., Nuveen Advisory Corp., Nuveen
Institutional Advisory Corp. and Rittenhouse Asset
Management, Inc.; formerly, Senior Attorney
(1994-July 2004), The Northern Trust Company.
------------------------------------------------------------------------------------------------------------------------------------
David J. Lamb Vice President 2000 Vice President (since 2000) of Nuveen Investments, 152
3/22/63 LLC, previously Assistant Vice President (since 1999);
333 W. Wacker Drive prior thereto, Associate of Nuveen Investments, LLC;
Chicago, IL 60606 Certified Public Accountant.
------------------------------------------------------------------------------------------------------------------------------------
Tina M. Lazar Vice President 2002 Vice President (since 1999), previously, Assistant Vice 152
8/27/61 President (since 1993) of Nuveen Investments, LLC.
333 W. Wacker Drive
Chicago, IL 60606
------------------------------------------------------------------------------------------------------------------------------------
Larry W. Martin Vice President 1988 Vice President, Assistant Secretary and Assistant General 152
7/27/51 and Assistant Counsel of Nuveen Investments, LLC; Vice President and
333 W. Wacker Drive Secretary Assistant Secretary of Nuveen Advisory Corp. and Nuveen
Chicago, IL 60606 Institutional Advisory Corp.; Assistant Secretary of Nuveen
Investments, Inc. and (since 1997) Nuveen Asset Management
Inc.; Vice President (since 2000), Assistant Secretary and
Assistant General Counsel (since 1998) of Rittenhouse Asset
Management, Inc.; Vice President and Assistant Secretary of
Nuveen Investments Advisers Inc. (since 2002); Assistant
Secretary of NWQ Investment Management Company, LLC
(since 2002).
------------------------------------------------------------------------------------------------------------------------------------
Edward F. Neild, IV Vice President 1996 Managing Director (since 2002) of Nuveen Investments, LLC; 152
7/7/65 Managing Director (since 1997), formerly Vice President
333 W. Wacker Drive (since 1996) of Nuveen Advisory Corp. and Nuveen Institutional
Chicago, IL 60606 Advisory Corp.; Managing Director of Nuveen Asset Management Inc.
(since 1999). Chartered Financial Analyst.
(1) Mr. Schwertfeger is an "interested person" of the Funds, as defined in the
Investment Company Act of 1940, because he is an officer and board member of
the Adviser.
(2) Board members serve an indefinite term until his/her successor is elected.
The year first elected or appointed represents the year in which the board
member was first elected or appointed to any fund in the Nuveen Complex.
(3) Officers serve one year terms through July of each year. The year first
elected or appointed represents the year in which the Officer was first
elected or appointed to any fund in the Nuveen Complex.
57
Reinvest Automatically
EASILY AND CONVENIENTLY
sidebar text: NUVEEN MAKES REINVESTING EASY. A PHONE CALL IS ALL IT TAKES TO SET
UP YOUR REINVESTMENT ACCOUNT.
NUVEEN CLOSED-END EXCHANGE-TRADED FUNDS
DIVIDEND REINVESTMENT PLAN
Your Nuveen Closed-End Exchange-Traded Fund allows you to conveniently reinvest
dividends and/or capital gains distributions in additional fund shares.
By choosing to reinvest, you'll be able to invest money regularly and
automatically, and watch your investment grow through the power of tax-free
compounding. Just like dividends or distributions in cash, there may be times
when income or capital gains taxes may be payable on dividends or distributions
that are reinvested.
It is important to note that an automatic reinvestment plan does not ensure a
profit,nor does it protect you against loss in a declining market.
EASY AND CONVENIENT
To make recordkeeping easy and convenient, each month you'll receive a statement
showing your total dividends and distributions, the date of investment, the
shares acquired and the price per share, and the total number of shares you own.
HOW SHARES ARE PURCHASED
The shares you acquire by reinvesting will either be purchased on the open
market or newly issued by the Fund. If the shares are trading at or above net
asset value at the time of valuation, the Fund will issue new shares at the
then-current market price. If the shares are trading at less than net asset
value, shares for your account will be purchased on the open market. Dividends
and distributions received to purchase shares in the open market will normally
be invested shortly after the dividend payment date. No interest will be paid on
the dividends or distributions awaiting reinvestment. Because the market price
may increase before purchases are completed, the average purchase price per
share may exceed the market price at the time of valuation, resulting in the
acquisition of fewer shares than if the dividend or distribution had been paid
in shares issued by the Fund. A pro rata portion of any applicable brokerage
commissions on open market purchases will be paid by Plan participants. These
commissions usually will be lower than those charged on individual transactions.
FLEXIBLE
You may change your distribution option or withdraw from the Plan at any time,
should your needs or situation change. Should you withdraw, you can receive a
certificate for all whole shares credited to your reinvestment account and cash
payment for fractional shares, or cash payment for all reinvestment account
shares, less brokerage commissions and a $2.50 service fee.
You can reinvest whether your shares are registered in your name, or in the name
of a brokerage firm, bank, or other nominee. Ask your investment advisor if his
or her firm will participate on your behalf. Participants whose shares are
registered in the name of one firm may not be able to transfer the shares to
another firm and continue to participate in the Plan.
The Fund reserves the right to amend or terminate the Plan at any time. Although
the Fund reserves the right to amend the Plan to include a service charge
payable by the participants, there is no direct service charge to participants
in the Plan at this time.
For more information on the Nuveen Automatic Reinvestment Plan or to enroll in
or withdraw from the Plan, speak with your financial advisor or call us at (800)
257-8787.
58
Other Useful
INFORMATION
QUARTERLY PORTFOLIO OF INVESTMENTS AND PROXY VOTING INFORMATION
Each Fund's (i) quarterly portfolio of investments and (ii) information
regarding how the Funds voted proxies relating to portfolio securities held
during the most recent 12-month period ended June 30, 2004, are available
without charge, upon request, by calling Nuveen Investments toll-free at (800)
257-8787 or on Nuveen's web site at www.nuveen.com.
You may also obtain this and other Fund information directly from the Securities
and Exchange Commission ("SEC"). The SEC may charge a copying fee for this
information. Visit the SEC on-line at http://www.sec.gov or in person at the
SEC's Public Reference Room in Washington, D.C. Call the SEC at 1-202-942-8090
for room hours and operation. You may also request Fund information by sending
an e-mail request to publicinfo@sec.gov or by writing to the SEC's Public
References Section at 450 Fifth Street NW, Washington, D.C. 20549.
GLOSSARY OF TERMS USED IN THIS REPORT
AVERAGE ANNUAL TOTAL RETURN: This is a commonly used method to express an
investment's performance over a particular, usually multi-year time period. It
expresses the return that would have been necessary each year to equal the
investment's actual cumulative performance (including change in NAV or market
price and reinvested dividends and capital gains distributions, if any) over the
time period being considered.
AVERAGE EFFECTIVE MATURITY: The average of all the maturities of the bonds in a
fund's portfolio, computed by weighting each maturity date (the date the
security comes due) by the market value of the security. This figure does not
account for the likelihood of prepayments or the exercise of call provisions.
LEVERAGE-ADJUSTED DURATION: Duration is a measure of the sensitivity of a bond
or bond fund's value to changes when interest rates change. Generally, the
longer a bond or fund's duration, the more the price of the bond or fund will
change as interest rates change. Leverage-adjusted duration takes into account
the leveraging process for a Fund and therefore is longer than the duration of
the Fund's portfolio of bonds.
MARKET YIELD (ALSO KNOWN AS DIVIDEND YIELD OR CURRENT YIELD): An investment's
current annualized dividend divided by its current market price.
NET ASSET VALUE (NAV): A Fund's common share NAV per share is calculated by
subtracting the liabilities of the Fund (including any MuniPreferred shares
issued in order to leverage the Fund) from its total assets and then dividing
the remainder by the number of shares outstanding. Fund NAVs are calculated at
the end of each business day.
TAXABLE-EQUIVALENT YIELD: The yield necessary from a fully taxable investment to
equal, on an after-tax basis, the yield of a municipal bond investment.
BOARD OF DIRECTORS
Robert P. Bremner
Lawrence H. Brown
Jack B. Evans
William C. Hunter
William J. Schneider
Timothy R. Schwertfeger
Judith M. Stockdale
FUND MANAGER
Nuveen Advisory Corp.
333 West Wacker Drive
Chicago, IL 60606
CUSTODIAN
State Street Bank & Trust
Boston, MA
TRANSFER AGENT AND
SHAREHOLDER SERVICES
State Street Bank & Trust
Nuveen Funds
P.O. Box 43071
Providence, RI 02940-3071
(800) 257-8787
LEGAL COUNSEL
Chapman and Cutler LLP
Chicago, IL
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Ernst & Young LLP
Chicago, IL
Each Fund intends to repurchase shares of its own common or preferred stock in
the future at such times and in such amounts as is deemed advisable. No shares
were purchased during the period ended October 31, 2004. Any future repurchases
will be reported to shareholders in the next annual or semiannual report.
59
Nuveen Investments:
SERVING Investors
For Generations
Photo of: 2 women looking at a photo album.
Since 1898, financial advisors and their clients have relied on Nuveen
Investments to provide dependable investment solutions. For the past century,
Nuveen Investments has adhered to the belief that the best approach to investing
is to apply conservative risk-management principles to help minimize volatility.
Building on this tradition, we today offer a range of high quality equity and
fixed-income solutions that are integral to a well-diversified core portfolio.
Our clients have come to appreciate this diversity, as well as our continued
adherence to proven, long-term investing principles.
WE OFFER MANY DIFFERENT INVESTING SOLUTIONS FOR OUR CLIENTS' DIFFERENT NEEDS.
Managing $100 billion in assets, Nuveen Investments offers access to a number of
different asset classes and investing solutions through a variety of products.
Nuveen Investments markets its capabilities under four distinct brands: Nuveen,
a leader in tax-free investments; NWQ, a leader in value-style equities;
Rittenhouse, a leader in growth-style equities; and Symphony, a leading
institutional manager of market-neutral alternative investment portfolios.
FIND OUT HOW WE CAN HELP YOU REACH YOUR FINANCIAL GOALS.
To learn more about the products and services Nuveen Investments offers and for
a prospectus, where applicable, talk to your financial advisor, or call us at
(800) 257-8787. Please read the information carefully before you invest.
Learn more
about Nuveen Funds at
WWW.NUVEEN.COM/ETF
o Share prices
o Fund details
o Daily financial news
o Investor education
o Interactive planning tools
Logo: NUVEEN Investments
EAN-E-1004D
ITEM 2. CODE OF ETHICS.
As of the end of the period covered by this report, the registrant has adopted
a code of ethics that applies to the registrant's principal executive officer,
principal financial officer, principal accounting officer or controller, or
persons performing similar functions. The registrant has posted such code of
ethics on its website at www.nuveen.com/etf.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
The registrant's Board of Directors or Trustees determined that the registrant
has at least one "audit committee financial expert" (as defined in Item 3 of
Form N-CSR) serving on its Audit Committee. The registrant's audit committee
financial expert is Jack B. Evans, Chairman of the Audit Committee, who is
"independent" for purposes of Item 3 of Form N-CSR. Mr. Evans has served as the
registrant's audit committee financial expert from July 26, 2004 to the end of
the reporting period on October 31, 2004.
Prior to July 26, 2004, William E. Bennett, who was "independent" for purposes
of Item 3 of Form N-CSR, served as the audit committee financial expert.
Although Mr. Bennett served as the audit committee financial expert during the
reporting period, he unexpectedly resigned from the Board effective April 30,
2004. Accordingly for this reporting period, the registrant did not have a
designated "audit committee financial expert" from May 1, 2004 to July 26, 2004.
Mr. Evans was formerly President and Chief Operating Officer of SCI Financial
Group, Inc., a full service registered broker-dealer and registered investment
adviser ("SCI"). As part of his role as President and Chief Operating Officer,
Mr. Evans actively supervised the Chief Financial Officer (the "CFO") and
actively supervised the CFO's preparation of financial statements and other
filings with various regulatory authorities. In such capacity, Mr. Evans was
actively involved in the preparation of SCI's financial statements and the
resolution of issues raised in connection therewith. Mr. Evans has also served
on the audit committee of various reporting companies. At such companies, Mr.
Evans was involved in the oversight of audits, audit plans, and the preparation
of financial statements. Mr. Evans also formerly chaired the audit committee of
the Federal Reserve Bank of Chicago.
Mr. Bennett was formerly Executive Vice President and Chief Credit Officer of
First Chicago Corporation and its principal subsidiary, The First National Bank
of Chicago. As part of his role as Chief Credit Officer, Mr. Bennett set policy
as to accrual of assets/loans; designated performing/non-performing assets; set
the level of reserves against the credit portfolio; and determined the carrying
value of credit related assets and exposure. Among other things, Mr. Bennett was
also responsible for the oversight of the internal analysis function including
setting ground rules for the review and preparation of financial analysis and
financial statements for use in making credit and risk decisions for clients.
Mr. Bennett has significant experience reviewing, analyzing and evaluating
financial statements of domestic and international companies in a variety of
industries with complex accounting issues.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
NUVEEN PREMIUM INCOME MUNICIPAL FUND, INC.
The following tables show the amount of fees that Ernst & Young LLP, the Fund's
auditor, billed to the Fund during the Fund's last two full fiscal years. For
engagements with Ernst & Young LLP entered into on or after May 6, 2003, the
Audit Committee approved in advance all audit services and non-audit services
that Ernst & Young LLP provided to the Fund, except for those non-audit services
that were subject to the pre-approval exception under Rule 2-01 of Regulation
S-X (the "pre-approval exception"). The pre-approval exception for services
provided directly to the Fund waives the pre-approval requirement for services
other than audit, review or attest services if: (A) the aggregate amount of all
such services provided constitutes no more than 5% of the total amount of
revenues paid by the Fund to its accountant during the fiscal year in which the
services are provided; (B) the Fund did not recognize the services as non-audit
services at the time of the engagement; and (C) the services are promptly
brought to the Audit Committee's attention, and the Committee (or its delegate)
approves the services before the audit is completed.
The Audit Committee has delegated certain pre-approval responsibilities to its
Chairman (or, in his absence, any other member of the Audit Committee).
SERVICES THAT THE FUND'S AUDITOR BILLED TO THE FUND
AUDIT FEES BILLED AUDIT-RELATED FEES TAX FEES ALL OTHER FEES
FISCAL YEAR ENDED TO FUND BILLED TO FUND BILLED TO FUND BILLED TO FUND
------------------------------------------------------------------------------------------------------------------------------------
October 31, 2004 $ 38,408 $ 0 $ 364 $ 2,550
------------------------------------------------------------------------------------------------------------------------------------
Percentage approved N/A 0% 0% 0%
pursuant to
pre-approval
exception
------------------------------------------------------------------------------------------------------------------------------------
October 31, 2003 $ 32,929 $ 0 $ 641 $ 2,350
------------------------------------------------------------------------------------------------------------------------------------
Percentage approved N/A 0% 0% 0%
pursuant to
pre-approval
exception
------------------------------------------------------------------------------------------------------------------------------------
The above "Tax Fees" were billed for professional services for tax advice, tax
compliance and tax planning.
SERVICES THAT THE FUND'S AUDITOR BILLED TO THE
ADVISER AND AFFILIATED FUND SERVICE PROVIDERS
The following tables show the amount of fees billed by Ernst & Young LLP to
Nuveen Advisory Corp. ("NAC" or the "Adviser"), and any entity controlling,
controlled by or under common control with NAC ("Control Affiliate") that
provides ongoing services to the Fund ("Affiliated Fund Service Provider"), for
engagements directly related to the Fund's operations and financial reporting,
during the Fund's last two full fiscal years.
The table also shows the percentage of fees subject to the pre-approval
exception. The pre-approval exception for services provided to the Adviser and
any Affiliated Fund Service Provider (other than audit, review or attest
services) waives the pre-approval requirement if: (A) the aggregate amount of
all such services provided constitutes no more than 5% of the total amount of
revenues paid to Ernst & Young LLP by the Fund, the Adviser and Affiliated Fund
Service Providers during the fiscal year in which the services are provided that
would have to be pre-approved by the Audit Committee; (B) the Fund did not
recognize the services as non-audit services at the time of the engagement; and
(C) the services are promptly brought to the Audit Committee's attention, and
the Committee (or its delegate) approves the services before the Fund's audit is
completed.
FISCAL YEAR ENDED AUDIT-RELATED FEES TAX FEES BILLED TO ALL OTHER FEES
BILLED TO ADVISER AND ADVISER AND BILLED TO ADVISER
AFFILIATED FUND AFFILIATED FUND AND AFFILIATED FUND
SERVICE PROVIDERS SERVICE PROVIDERS SERVICE PROVIDERS
------------------------------------------------------------------------------------------------------------------------------------
October 31, 2004 $ 0 $ 0 $ 0
------------------------------------------------------------------------------------------------------------------------------------
Percentage approved 0% 0% 0%
pursuant to
pre-approval
exception
------------------------------------------------------------------------------------------------------------------------------------
October 31, 2003 $ 0 $ 0 $ 0
------------------------------------------------------------------------------------------------------------------------------------
Percentage approved N/A N/A N/A
pursuant to
pre-approval
exception
------------------------------------------------------------------------------------------------------------------------------------
NON-AUDIT SERVICES
The following table shows the amount of fees that Ernst & Young LLP billed
during the Fund's last two full fiscal years for non-audit services. For
engagements entered into on or after May 6, 2003, the Audit Committee is
required to pre-approve non-audit services that Ernst & Young LLP provides to
the Adviser and any Affiliated Fund Services Provider, if the engagement related
directly to the Fund's operations and financial reporting (except for those
subject to the de minimis exception described above). The Audit Committee
requested and received information from Ernst & Young LLP about any non-audit
services that Ernst & Young LLP rendered during the Fund's last fiscal year to
the Adviser and any Affiliated Fund Service Provider. The Committee considered
this information in evaluating Ernst & Young LLP independence.
FISCAL YEAR ENDED TOTAL NON-AUDIT FEES
BILLED TO ADVISER AND
AFFILIATED FUND SERVICE TOTAL NON-AUDIT FEES
PROVIDERS (ENGAGEMENTS BILLED TO ADVISER AND
RELATED DIRECTLY TO THE AFFILIATED FUND SERVICE
TOTAL NON-AUDIT FEES OPERATIONS AND FINANCIAL PROVIDERS (ALL OTHER
BILLED TO FUND REPORTING OF THE FUND) ENGAGEMENTS) TOTAL
------------------------------------------------------------------------------------------------------------------------------------
October 31, 2004 $ 2,914 $ 0 $ 0 $ 2,914
October 31, 2003 $ 2,991 $ 0 $ 0 $ 2,991
Audit Committee Pre-Approval Policies and Procedures. Generally, the audit
committee must approve (i) all non-audit services to be performed for the Fund
by the Fund's independent accountants and (ii) all audit and non-audit services
to be performed by the Fund's independent accountants for the Affiliated Fund
Service Providers with respect to operations and financial reporting of the
Fund. Regarding tax and research projects conducted by the independent
accountants for the Fund and Affiliated Fund Service Providers (with respect to
operations and financial reports of the Fund) such engagements will be (i)
pre-approved by the audit committee if they are expected to be for amounts
greater than $10,000; (ii) reported to the audit committee chairman for his
verbal approval prior to engagement if they are expected to be for amounts under
$10,000 but greater than $5,000; and (iii) reported to the audit committee at
the next audit committee meeting if they are expected to be for an amount under
$5,000.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
The registrant's Board of Directors or Trustees has a separately designated
audit committee established in accordance with Section 3(a)(58)(A) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act") (15 U.S.C.
78c(a)(58)(A)). The members of the audit committee are Robert P. Bremner,
Lawrence H. Brown, Jack B. Evans and William J. Schneider.
ITEM 6. SCHEDULE OF INVESTMENTS.
See Schedule I in Item 1.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
In the rare event that a municipal issuer held by the Fund were to issue a proxy
or that the Fund were to receive a proxy issued by a cash management security,
the Adviser would either engage an independent third party to determine how the
proxy should be voted or vote the proxy with the consent, or based on the
instructions, of the Fund's Board of Directors or Trustees or its
representative. In the case of a conflict of interest, the proxy would be
submitted to the applicable Fund's Board to determine how the proxy should be
voted. A member of the Adviser's legal department would oversee the
administration of the voting, and ensure that records were maintained in
accordance with Rule 204-2(c)(2) under the Investment Advisers Act of 1940 (17
CFR 275.204-2(c)(2)), reports were filed with the SEC on Form N-PX, and the
results were provided to the Board of Directors or Trustees and made available
to shareholders as required by applicable rules.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable at this time.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
In the event of a vacancy on the Board, the nominating and governance committee
receives suggestions from various sources, including shareholders, as to
suitable candidates. Suggestions should be sent in writing to Lorna Ferguson,
Vice President for Board Relations, Nuveen Investments, 333 West Wacker Drive,
Chicago, IL 60606. The nominating and governance committee sets appropriate
standards and requirements for nominations for new directors or trustees and
reserves the right to interview all candidates and to make the final selection
of any new directors or trustees.
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") (17 CFR 270.30a-3(c))) are effective, as of a date within
90 days of the filing date of this report that includes the disclosure
required by this paragraph, based on their evaluation of the controls
and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR
270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the Exchange Act
(17 CFR 240.13a-15(b) or 240.15d-15(b)).
(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
(17 CFR 270.30a-3(d)) that occurred during the second fiscal quarter
of the period covered by this report that has materially affected, or
is reasonably likely to materially affect, the registrant's internal
control over financial reporting.
ITEM 12. EXHIBITS.
File the exhibits listed below as part of this Form. Letter or number the
exhibits in the sequence indicated.
(a)(1) Any code of ethics, or amendment thereto, that is the subject of the
disclosure required by Item 2, to the extent that the registrant intends to
satisfy the Item 2 requirements through filing of an exhibit: Not applicable
because posted on registrant's website at www.nuveen.com/etf.
(a)(2) A separate certification for each principal executive officer and
principal financial officer of the registrant as required by Rule 30a-2(a) under
the 1940 Act (17 CFR 270.30a-2(a)) in the exact form set forth below: Ex-99.CERT
Attached hereto.
(a)(3) Any written solicitation to purchase securities under Rule 23c-1 under
the 1940 Act (17 CFR 270.23c-1) sent or given during the period covered by the
report by or on behalf of the registrant to 10 or more persons. Not applicable.
(b) If the report is filed under Section 13(a) or 15(d) of the Exchange Act,
provide the certifications required by Rule 30a-2(b) under the 1940 Act (17 CFR
270.30a-2(b)); Rule 13a-14(b) or Rule 15d-14(b) under the Exchange Act (17 CFR
240.13a-14(b) or 240.15d-14(b)), and Section 1350 of Chapter 63 of Title 18 of
the United States Code (18 U.S.C. 1350) as an exhibit. A certification furnished
pursuant to this paragraph will not be deemed "filed" for purposes of Section 18
of the Exchange Act (15 U.S.C. 78r), or otherwise subject to the liability of
that section. Such certification will not be deemed to be incorporated by
reference into any filing under the Securities Act of 1933 or the Exchange Act,
except to the extent that the registrant specifically incorporates it by
reference. Ex-99.906 CERT attached hereto.
SIGNATURES
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.
(Registrant) Nuveen Premium Income Municipal Fund, Inc.
-----------------------------------------------------------
By (Signature and Title)* /s/ Jessica R. Droeger
----------------------------------------------
Jessica R. Droeger
Vice President and Secretary
Date: January 6, 2005
-------------------------------------------------------------------
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 (Signature and Title)* /s/ Gifford R. Zimmerman
----------------------------------------------
Gifford R. Zimmerman
Chief Administrative Officer
(Principal Executive Officer)
Date: January 6, 2005
-------------------------------------------------------------------
By (Signature and Title)* /s/ Stephen D. Foy
----------------------------------------------
Stephen D. Foy
Vice President and Controller
(Principal Financial Officer)
Date: January 6, 2005
-------------------------------------------------------------------
* Print the name and title of each signing officer under his or her signature.