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, 2005
------------------
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, 2005
Nuveen Investments
Municipal Exchange-Traded
Closed-End 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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KEEP.(R)
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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 12-month period covered by this
report your Fund continued to provide you with attractive monthly tax-free
income. For more details about the management strategy and performance of your
Fund, please see the Portfolio Managers' Comments and Performance Overview
sections of this report.
Given recent reports of a strengthening economy, some market commentators are
speculating about whether longer-term interest rates will soon begin to rise
substantially, mirroring the rise that has taken place in shorter-term rates. If
longer-term rates do begin to rise significantly, some have suggested that this
would be a signal to begin selling your holdings of fixed-income investments.
"IN FACT, A WELL-DIVERSIFIED PORTFOLIO MAY ACTUALLY HELP TO REDUCE YOUR OVERALL
INVESTMENT RISK OVER THE LONG TERM."
Nobody knows what the market will do in the future or what investments will turn
out to be tomorrow's best performers. But from our experience, we do know that a
well-balanced portfolio, structured and carefully monitored with the help of a
trusted investment professional, can be an important component in helping you
achieve your long-term financial goals. In fact, a well-diversified portfolio
may actually help to reduce your overall investment risk over the long term.
That is one reason why we believe that a municipal bond investment like your
Fund can be an important building block in a comprehensive investment program
designed to perform well in a variety of market conditions.
As an added convenience for you, I urge you to consider receiving future Fund
reports and other Fund information by e-mail and the Internet. Not only will you
be able to receive the information faster, but this also may help lower your
Fund's expenses. Sign up is quick and easy - see the inside front cover of this
report for instructions.
Earlier in 2005, The St. Paul Travelers Companies, Inc., which owned 79% of
Nuveen Investments, Inc. (the parent of your Fund's investment adviser), sold a
substantial portion of its stake in Nuveen. More recently, St. Paul sold the
balance of its shares to Nuveen Investments or to others. Please be assured that
these transactions only affect Nuveen's corporate structure, and they do not
have any impact on the investment objectives or management of your Fund.
At Nuveen Investments, our mission continues to be to assist you and your
financial advisor by offering 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, 2005
Nuveen Investments Municipal Exchange-Traded Closed-End Funds
NPI, NPM, NPT
Portfolio Managers'
COMMENTS
Portfolio managers Dan Solender and Tom Spalding discuss the economic and
municipal market environments, key investment strategies and the annual
performance of these three Funds. With 13 years of investment experience,
including 9 at Nuveen, Dan assumed portfolio management responsibility for NPI
and NPM in 2003. A 30-year veteran of Nuveen, Tom has managed NPT since 2003.
WHAT FACTORS AFFECTED THE U.S. ECONOMY AND MUNICIPAL MARKET DURING THE 12-MONTH
PERIOD ENDED OCTOBER 31, 2005?
Between November 1, 2004, and October 31, 2005, the Federal Reserve implemented
eight 0.25% increases in the closely-watched fed funds rate. These increases,
which were aimed at controlling the pace of inflation, raised this short-term
target rate to 3.75% from 1.75%. (On November 1, 2005, and December 13, 2005,
the fed funds rate was increased by 0.25% to reach 4.25%.) Over this same
12-month period, shorter-term municipal market rates also rose significantly.
Longer-term yields declined throughout much of this period before rising toward
the end of the fiscal year. The yield on the benchmark 10-year U.S. Treasury
note ended October 2005 at 4.56%, compared with 4.03% one year earlier.
Longer-term yields in the municipal market followed a similar pattern, with the
yield on the Bond Buyer 25 Revenue Bond Index, a widely followed measure of
longer-term municipal market rates, ending the reporting period at 5.21%, an
increase of 24 basis points from October 31, 2004. Together, the steady rise in
shorter-term rates and the much more modest increase in longer rates over this
period produced an overall flattening of the yield curve, which generally led to
better relative performance for bonds with longer effective maturities and
poorer returns for bonds with shorter maturities or short call dates.
The economy continued to improve over the 12-month period. After expanding at an
annualized rate of 3.3% in the fourth quarter of 2004, the U.S. gross domestic
product (GDP) grew by annualized rates of 3.8% in the first quarter of 2005,
3.3% in the second quarter and 3.8% in the third quarter. The overall employment
picture showed some improvement, with national unemployment at 5.0% in October
2005, down from 5.5% in October 2004. However, the 4.3% year-over-year increase
in the Consumer Price Index as of October 2005 raised some inflation concerns.
Over the 12 months ended October 2005, municipal bond new issue supply
nationwide remained strong, as $363.4 billion in new securities came to market.
A major factor behind this strong supply was the flattening yield curve, which
made advance refundings more economically attractive for many issuers. (Advance
refundings, also known as pre-refundings or refinancings, occur when an issuer
sells new bonds and uses the proceeds to fund the principal and interest
payments of older, previously issued bonds
4
that carry a higher coupon rate. This process usually results in lower total
borrowing costs for bond issuers.) Between January and October 2005,
pre-refunding volume was nearly 50% higher than during the same period in 2004,
as issuers sought to take advantage of the current interest rate environment.
WHAT KEY STRATEGIES WERE USED TO MANAGE THESE FUNDS DURING THE 12 MONTHS ENDED
OCTOBER 31, 2005?
With the Fed continuing to raise short-term interest rates and the overall
flattening of the yield curve, one of our top priorities during this period was
positioning the Funds' portfolios in ways that we believed would add value and
enhance their potential to perform well under a variety of future market
scenarios. As part of this effort, we took proceeds from called, matured or sold
holdings in NPI and NPM and reinvested them in bonds that matured in 15 to 20
years. In NPT, our time horizon stretched toward bonds maturing in 25 years.
Among the bonds we sold were those with shorter durations1 (under five years),
including pre-refunded bonds and bonds priced to short call dates. These
securities tended to underperform in the interest rate environment of the past
12 months. The longer maturities of the bonds we added to the Funds' portfolios
enabled us to maintain the Funds' durations within our desired range and
contributed favorably to their performance during this period. Selling shorter
duration bonds and reinvesting further out on the yield curve also helped to
improve the Funds' overall call protection.
Overall, the ample new issue supply during this period provided us with
opportunities to find the types of bonds we were seeking. While our main focus
was the 15 - 25 year part of the yield curve, we also kept an opportunistic eye
toward all types of issuance that we believed could add value to the Funds'
portfolios. In NPI and NPM, we continued to add to the Funds' weightings of
bonds rated BBB and lower, especially in the healthcare sector. Overall,
lower-rated bonds performed very well during this period, but considerable
investor demand limited the number of attractive opportunities. Another area of
emphasis for these Funds was purchasing credits from states like California and
New York, where state income taxes are relatively higher. This generally results
in greater demand for municipal bonds in these states, providing a measure of
support for bond prices and additional liquidity for the Funds' portfolio
activity. Overall, we found value in the general obligation, limited tax
obligation, and water and sewer sectors.
In NPT, our purchase activity generally emphasized finding premium coupon bonds
with adequate call protection. Premium bonds are those trading above their par
values because their coupons were higher than current coupon levels.
Historically, premium bonds have held their value better than the then current
coupon bonds when interest rates have risen. Premium bonds also are good
candidates for advance refundings, and trading pre-refunded bonds at opportune
times in the interest rate cycle has historically been a key strategy for adding
value to this Fund. In general, we tried to buy essential
1 Duration is a measure of a bond's price sensitivity as interest rates
change, with longer duration bonds displaying more sensitivity to these
changes than bonds with shorter durations.
5
services revenue bonds that would also help us keep the Funds well diversified
geographically. Lower-rated bonds generally were in great demand during this
period, and as a result we did not find many attractive opportunities among
lower-rated issues to add securities that we believed would enhance value. As a
result, the majority of our purchase activity focused on higher quality bonds,
especially during the second half of this 12-month period.
HOW DID THE FUNDS PERFORM?
Individual results for these Funds, as well as for comparative indexes and
averages, are presented in the accompanying table.
TOTAL RETURNS ON NET ASSET VALUE*
For periods ended 10/31/05
1-YEAR 5-YEAR 10-YEAR
--------------------------------------------------------------------------------
NPI 3.71% 7.13% 6.14%
--------------------------------------------------------------------------------
NPM 3.71% 7.20% 6.73%
--------------------------------------------------------------------------------
NPT 4.87% 6.12% 5.77%
--------------------------------------------------------------------------------
Lehman Brothers
Municipal
Bond Index2 2.54% 5.98% 5.85%
--------------------------------------------------------------------------------
Lipper General
Leveraged
Municipal Debt
Funds Average3 5.08% 7.75% 6.52%
--------------------------------------------------------------------------------
*Annualized
Past performance is not predictive of future results. Current performance may be
higher or lower than the data shown. Returns do not reflect the deduction of
taxes that shareholders may have to pay on Fund distributions or upon the sale
of Fund shares.
For additional information, see the individual Performance Overview for your
Fund in this report.
For the 12 months ended October 31, 2005, the total returns on net asset value
(NAV) for all three of the Funds in this report exceeded the return on the
Lehman Brothers Municipal Bond Index. Each of the Funds underperformed the
average return over this period for their Lipper peer group.
One of the factors that, on balance, benefited the 12-month performance of these
Funds relative to that of the unleveraged Lehman Brothers index was the Funds'
use of financial leverage, even though increases in longer-term municipal bond
rates caused the value of the Funds' holdings to fall, and the Funds' financial
leverage exacerbated this decline. Leveraging can provide opportunities for
enhanced income for common shareholders when short-term interest rates remain
below the yields of the bonds purchased for the Funds' portfolios. This
continued to be the case during these 12 months. At the same time, leveraging
can add volatility to a Fund's NAV and share price, and can act to constrain
overall Fund performance during periods when interest rates rise. This was
evident during this reporting period. Essentially, the positive impact of
leverage on net
2 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.
3 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, 64 funds; 5 years, 48
funds; and 10 years, 43 funds. Fund and Lipper returns assume reinvestment
of dividends.
6
income during the 12-month period was roughly offset by the negative impact that
leverage had on the Funds' NAVs.
As noted earlier, longer maturity bonds generally performed better than
securities with shorter maturities over the course of this 12-month period.
Yield curve positioning or, more specifically, heavier exposure to the 15- to
25-year range of the yield curve helped the performances of all three of these
Funds relative to the Lehman Brothers municipal index, which is more evenly
weighted across the entire yield curve.
All of these Funds also benefited from their allocations of lower-quality bonds
during this period, as bonds rated BBB and lower generally outperformed other
credit quality sectors. Among the lower-rated credits making significant
contributions to the Funds' total returns for this period were bonds backed by
the 1998 master tobacco settlement agreement. Generally, tobacco bond prices
moved higher over this period as the litigation environment improved. As of
October 31, 2005, NPI and NPM held about 2.5% of their portfolios in tobacco
bonds, while NPT had about 6% of its portfolio in these securities. This
weighting difference was a significant factor in the total return differences
between these Funds over the 12-month period. Lower-rated hospital holdings also
contributed positively to each Fund's total return, as the healthcare sector
ranked second in terms of performance among the Lehman municipal revenue sectors
for the period.
During this reporting period, NPT's total return also benefited from the
recovery on a prior distressed holding involving multifamily housing bonds
issued by Oklahoma County Finance Authority. This settlement was completed in
February 2005.
An additional positive factor in the performance of these Funds was their
holdings of zero coupon bonds. These bonds do not make periodic interest
payments and therefore typically have very long initial maturities. The prices
of these bonds tend to be very sensitive to changes in interest rates. With
interest rates at the long end of the curve declining throughout much of the 12
months ended October 31, 2005, zero coupon bonds in the Lehman Municipal Bond
Index outperformed the general market by 130 basis points.
In addition to yield curve positioning, credit exposure, and specific holdings,
another factor in the Funds' performances during this period was advance
refundings. Refinancings rose sharply during this period, and the Funds'
performances benefited from the amount of their portfolios that became advance
refunded and the timing of these events. Generally, newly refunded bonds receive
a higher credit rating, which usually translates to a higher price. NPT in
particular benefited from advance refundings during this period.
While newly pre-refunded bonds tended to enhance the Funds' performances, their
holdings of older, previously pre-refunded bonds tended to underperform the
general municipal market during this period, primarily because of the shorter
effective maturities
7
of these bonds. As more of the Funds' holdings became advance refunded, we were
selling selected issues to keep our allocations of pre-refunded credits at
desired levels.
HOW WERE THE FUNDS POSITIONED IN TERMS OF CREDIT QUALITY AND BOND CALLS AS OF
OCTOBER 31, 2005?
We continued to believe that maintaining strong credit quality was an important
requirement. As of October 31, 2005, all three of these Funds continued to offer
excellent credit quality, with allocations of bonds rated AAA/U.S. guaranteed
and AA ranging 73% in NPI and NPM to 79% in NPT.
As of October 31, 2005, potential call exposure for the period from November
2005 through the end of 2006 totaled 5% in NPI, 8% in NPM and 11% in NPT. The
number of actual bond calls in all of these Funds depends largely on future
market interest rates.
8
Dividend and Share Price
INFORMATION
All of the Funds in this report use leverage to enhance opportunities for
additional income for common shareholders. The extent of this benefit is tied in
part to the short-term rates these three leveraged 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. However, when
short-term interest rates rise, as they did during this reporting period, the
Funds' borrowing costs also rise. While leveraging still provided benefits for
common shareholders, the extent of these benefits was reduced. This resulted in
two monthly dividend reductions in NPT and three in NPI and NPM over the
12-month period ended October 31, 2005.
In addition, due to normal portfolio activity, common shareholders of NPM
received capital gains and net ordinary income distributions at the end of
December 2004 as follows:
LONG-TERM CAPITAL GAINS ORDINARY INCOME
(PER SHARE) (PER SHARE)
--------------------------------------------------------------------------------
NPM $0.0971 $0.0029
--------------------------------------------------------------------------------
This relatively large distribution represented an important part of the Fund's
total return for this period, and was generated by bond calls and the sale of
appreciated securities. This had a slight negative impact on the Fund's earning
power per common share and was a minor factor in the per share dividend
reductions noted above.
All of the Funds in this report 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, 2005, all of
the Funds in this report had positive UNII balances for both financial statement
and tax purposes.
At the end of the reporting period, the Funds' share prices were trading at
discounts to their NAVs as shown in the accompanying chart:
10/31/05 12-MONTH
DISCOUNT AVERAGE DISCOUNT
--------------------------------------------------------------------------------
NPI -6.60% -6.84%
--------------------------------------------------------------------------------
NPM -7.30% -7.13%
--------------------------------------------------------------------------------
NPT -8.00% -8.59%
--------------------------------------------------------------------------------
9
Nuveen Premium Income Municipal Fund, Inc.
NPI
Performance
OVERVIEW As of October 31, 2005
Pie Chart:
CREDIT QUALITY
(as a % of total investments)
AAA/U.S. Guaranteed 61%
AA 12%
A 16%
BBB 7%
BB or Lower 1%
NR 3%
Bar Chart:
2004-2005 MONTHLY TAX-FREE DIVIDENDS PER SHARE
Nov 0.08
Dec 0.08
Jan 0.08
Feb 0.08
Mar 0.077
Apr 0.077
May 0.077
Jun 0.073
Jul 0.073
Aug 0.073
Sep 0.0695
Oct 0.0695
Line Chart:
SHARE PRICE PERFORMANCE
Weekly Closing Price
Past performance is not predictive of future results.
11/1/04 14.33
14.43
14.44
14.39
14.02
13.75
13.97
13.81
13.87
14.05
14.05
14.13
14.14
14.07
14.03
14.07
14.1
14.03
14.02
13.94
13.85
13.88
13.82
13.94
13.92
13.9
14
14.01
13.99
13.91
13.83
13.87
13.7
13.69
13.68
13.68
13.65
13.64
13.61
13.65
13.7
13.84
13.89
13.93
13.91
13.97
14.03
14.19
14.15
14.05
13.9
13.91
13.84
13.87
13.86
13.89
13.91
13.94
13.89
13.94
13.98
14.07
14.1
14.2
14.3
14.39
14.4
14.45
14.45
14.48
14.52
14.43
14.44
14.4
14.36
14.5
14.26
14.06
14.14
14.24
14.25
14.2
14.24
14.26
14.25
14.28
14.31
14.26
14.1
14.1
13.88
13.87
13.85
13.77
13.79
13.77
13.95
13.88
13.68
13.86
13.73
13.73
13.88
13.93
14.04
13.99
13.9
14.05
14.07
14
14.09
14.05
14.04
14
13.98
14.11
14.05
14.09
14.1
14.07
14.13
14.12
14.13
14.14
14.24
14.24
14.34
14.34
14.38
14.4
14.23
14.32
14.38
14.22
14.18
14.24
14.25
14.32
14.38
14.39
14.35
14.32
14.34
14.35
14.33
14.39
14.41
14.48
14.49
14.49
14.48
14.52
14.52
14.52
14.48
14.3
14.3
14.29
14.39
14.35
14.29
14.31
14.32
14.3
14.33
14.31
14.34
14.36
14.38
14.35
14.34
14.39
14.42
14.46
14.48
14.47
14.35
14.35
14.38
14.28
14.32
14.33
14.26
14.25
14.29
14.33
14.45
14.53
14.54
14.54
14.53
14.48
14.47
14.47
14.42
14.31
14.28
14.39
14.35
14.39
14.39
14.34
14.36
14.4
14.49
14.51
14.46
14.49
14.51
14.5
14.53
14.57
14.58
14.68
14.7
14.69
14.7
14.65
14.64
14.66
14.61
14.48
14.33
14.33
14.29
14.23
14.24
14.09
14.04
13.95
13.92
14.03
13.96
14
14.01
14.07
14.07
14.02
14.01
13.97
14.02
13.79
13.6
13.53
13.45
13.4
13.56
13.63
13.79
13.88
13.82
13.72
13.8
13.8
10/31/05 13.87
FUND SNAPSHOT
------------------------------------
Common Share Price $13.87
------------------------------------
Common Share
Net Asset Value $14.85
------------------------------------
Premium/(Discount) to NAV -6.60%
------------------------------------
Market Yield 6.01%
------------------------------------
Taxable-Equivalent Yield1 8.35%
------------------------------------
Net Assets Applicable to
Common Shares ($000) $947,446
------------------------------------
Average Effective Maturity
on Securities (Years) 16.94
------------------------------------
Leverage-Adjusted Duration 9.43
------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 7/18/88)
------------------------------------
ON SHARE PRICE ON NAV
------------------------------------
1-Year 3.37% 3.71%
------------------------------------
5-Year 9.85% 7.13%
------------------------------------
10-Year 6.32% 6.14%
------------------------------------
STATES
(as a % of total investments)
------------------------------------
California 15.3%
------------------------------------
New York 11.0%
------------------------------------
Texas 8.1%
------------------------------------
Illinois 6.2%
------------------------------------
New Jersey 5.5%
------------------------------------
South Carolina 4.3%
------------------------------------
Washington 4.1%
------------------------------------
Pennsylvania 4.0%
------------------------------------
Massachusetts 3.8%
------------------------------------
Colorado 3.5%
------------------------------------
Minnesota 3.3%
------------------------------------
Nevada 3.1%
------------------------------------
District of Columbia 2.9%
------------------------------------
Michigan 2.5%
------------------------------------
Wisconsin 1.9%
------------------------------------
Missouri 1.8%
------------------------------------
Other 18.7%
------------------------------------
SECTORS
(as a % of total investments)
------------------------------------
Tax Obligation/General 18.9%
------------------------------------
Tax Obligation/Limited 16.8%
------------------------------------
Healthcare 12.1%
------------------------------------
U.S. Guaranteed 12.0%
------------------------------------
Transportation 11.3%
------------------------------------
Utilities 8.6%
------------------------------------
Education and Civic
Organizations 8.0%
------------------------------------
Other 12.3%
------------------------------------
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%. When
comparing this Fund to investments that generate qualified dividend income,
the taxable-equivalent yield is lower.
10
Nuveen Premium Income Municipal Fund 2, Inc.
NPM
Performance
OVERVIEW As of October 31, 2005
Pie Chart:
CREDIT QUALITY
(as a % of total investments)
AAA/U.S. Guaranteed 64%
AA 9%
A 15%
BBB 7%
BB or Lower 1%
NR 4%
Bar Chart:
2004-2005 MONTHLY TAX-FREE DIVIDENDS PER SHARE2
Nov 0.0815
Dec 0.0815
Jan 0.0815
Feb 0.0815
Mar 0.0785
Apr 0.0785
May 0.0785
Jun 0.0745
Jul 0.0745
Aug 0.0745
Sep 0.071
Oct 0.071
Line Chart:
SHARE PRICE PERFORMANCE
Weekly Closing Price
Past performance is not predictive of future results.
11/1/04 14.61
14.65
14.58
14.62
14.35
14.07
14.2
14.11
14.12
14.2
14.24
14.19
14.24
14.25
14.14
14.16
14.15
14.14
14.21
14.12
14.03
14.02
13.94
14.09
14.08
14.12
14.11
14.12
14.2
14.04
14.06
14.1
13.96
13.94
13.95
14
13.96
14.01
13.97
13.91
13.97
14.03
14.08
14.14
14.28
14.22
14.34
14.43
14.26
14.29
14.11
14.15
14.04
14.05
14.02
14.05
14.06
14.13
14.19
14.17
14.22
14.27
14.26
14.34
14.36
14.39
14.49
14.54
14.52
14.61
14.65
14.58
14.51
14.52
14.52
14.55
14.42
14.19
14.28
14.37
14.47
14.45
14.45
14.39
14.41
14.45
14.5
14.49
14.22
14.29
14.16
14
13.99
13.86
13.96
13.9
13.77
13.6
13.41
13.61
13.6
13.8
13.77
13.85
13.89
13.8
13.71
13.84
13.74
13.71
13.84
13.84
13.74
13.75
13.77
13.82
13.8
13.79
13.73
13.76
13.8
13.75
13.89
13.98
14.05
14.05
14.08
14.18
14.2
14.29
14.2
14.28
14.38
14.29
14.35
14.28
14.29
14.32
14.41
14.39
14.38
14.4
14.55
14.48
14.46
14.47
14.5
14.58
14.58
14.53
14.47
14.52
14.46
14.49
14.49
14.33
14.32
14.37
14.43
14.42
14.42
14.49
14.55
14.57
14.66
14.74
14.67
14.7
14.77
14.75
14.75
14.79
14.81
14.85
14.91
14.92
14.78
14.77
14.72
14.6
14.65
14.68
14.62
14.64
14.55
14.64
14.68
14.72
14.7
14.7
14.7
14.71
14.7
14.65
14.56
14.49
14.5
14.53
14.46
14.45
14.4
14.52
14.51
14.49
14.49
14.5
14.55
14.59
14.59
14.58
14.62
14.64
14.66
14.74
14.75
14.74
14.72
14.81
14.9
14.89
14.85
14.82
14.75
14.72
14.69
14.66
14.67
14.6
14.54
14.39
14.4
14.55
14.5
14.53
14.55
14.53
14.54
14.52
14.47
14.4
14.49
14.25
14.12
14.06
14.14
14.01
14.02
13.98
14.05
14.02
14.04
13.85
13.89
13.88
10/31/05 13.97
FUND SNAPSHOT
------------------------------------
Common Share Price $13.97
------------------------------------
Common Share
Net Asset Value $15.07
------------------------------------
Premium/(Discount) to NAV -7.30%
------------------------------------
Market Yield 6.10%
------------------------------------
Taxable-Equivalent Yield1 8.47%
------------------------------------
Net Assets Applicable to
Common Shares ($000) $619,282
------------------------------------
Average Effective Maturity
on Securities (Years) 16.19
------------------------------------
Leverage-Adjusted Duration 9.75
------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 7/23/92)
------------------------------------
ON SHARE PRICE ON NAV
------------------------------------
1-Year 2.98% 3.71%
------------------------------------
5-Year 8.28% 7.20%
------------------------------------
10-Year 7.56% 6.73%
------------------------------------
STATES
(as a % of total investments)
------------------------------------
New York 11.5%
------------------------------------
Illinois 10.8%
------------------------------------
California 9.8%
------------------------------------
Texas 8.5%
------------------------------------
South Carolina 6.3%
------------------------------------
Washington 6.1%
------------------------------------
Missouri 4.6%
------------------------------------
Massachusetts 3.9%
------------------------------------
Nevada 3.6%
------------------------------------
Minnesota 2.8%
------------------------------------
Ohio 2.6%
------------------------------------
New Jersey 2.6%
------------------------------------
Indiana 2.4%
------------------------------------
Michigan 2.2%
------------------------------------
Florida 2.1%
------------------------------------
Rhode Island 1.9%
------------------------------------
Other 18.3%
------------------------------------
SECTORS
(as a % of total investments)
------------------------------------
Tax Obligation/General 20.5%
------------------------------------
Tax Obligation/Limited 16.2%
------------------------------------
U.S. Guaranteed 12.6%
------------------------------------
Healthcare 12.4%
------------------------------------
Utilities 12.0%
------------------------------------
Transportation 6.7%
------------------------------------
Education and Civic
Organizations 6.7%
------------------------------------
Other 12.9%
------------------------------------
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%. When
comparing this Fund to investments that generate qualified dividend income,
the taxable-equivalent yield is lower.
2 The Fund also paid shareholders capital gains and net ordinary income
distributions in December 2004 of $0.1000 per share.
11
Nuveen Premium Income Municipal Fund 4, Inc.
NPT
Performance
OVERVIEW As of October 31, 2005
Pie Chart:
CREDIT QUALITY
(as a % of total investments)
AAA/U.S. Guaranteed 70%
AA 9%
A 10%
BBB 6%
BB or Lower 3%
NR 2%
Bar Chart:
2004-2005 MONTHLY TAX-FREE DIVIDENDS PER SHARE
Nov 0.071
Dec 0.071
Jan 0.071
Feb 0.071
Mar 0.068
Apr 0.068
May 0.068
Jun 0.0645
Jul 0.0645
Aug 0.0645
Sep 0.0645
Oct 0.0645
Line Chart:
SHARE PRICE PERFORMANCE
Weekly Closing Price
Past performance is not predictive of future results.
11/1/04 12.76
12.87
12.8
12.86
12.53
12.26
12.38
12.33
12.3
12.34
12.39
12.4
12.45
12.43
12.35
12.37
12.4
12.37
12.38
12.24
12.19
12.26
12.07
12.21
12.32
12.35
12.41
12.41
12.5
12.31
12.2
12.21
12.05
11.95
11.85
11.84
11.83
11.84
11.85
11.85
11.99
12.06
12.2
12.24
12.3
12.27
12.36
12.44
12.34
12.31
12.22
12.13
12.13
12.2
12.19
12.25
12.22
12.27
12.28
12.29
12.32
12.36
12.38
12.47
12.5
12.53
12.55
12.62
12.59
12.63
12.8
12.67
12.61
12.67
12.65
12.53
12.45
12.35
12.45
12.54
12.58
12.56
12.57
12.55
12.52
12.56
12.56
12.54
12.34
12.35
12.24
12.12
12.09
12.04
12.06
11.93
11.95
11.89
11.69
11.85
11.72
11.69
11.9
12.04
12.12
12.14
12.15
12.2
12.16
12.15
12.2
12.25
12.11
12.05
12.03
12.11
12.2
12.16
12.08
12.13
12.16
12.17
12.25
12.26
12.29
12.29
12.36
12.37
12.35
12.37
12.36
12.4
12.35
12.33
12.3
12.3
12.35
12.37
12.47
12.48
12.44
12.52
12.53
12.5
12.48
12.5
12.57
12.57
12.64
12.62
12.62
12.66
12.62
12.57
12.6
12.6
12.51
12.49
12.56
12.53
12.5
12.45
12.51
12.51
12.54
12.61
12.57
12.63
12.62
12.61
12.62
12.63
12.71
12.78
12.74
12.75
12.65
12.67
12.74
12.6
12.6
12.61
12.61
12.67
12.68
12.7
12.75
12.89
12.86
12.86
12.79
12.85
12.83
12.8
12.73
12.65
12.7
12.8
12.7
12.7
12.7
12.66
12.67
12.68
12.69
12.66
12.65
12.66
12.66
12.68
12.7
12.71
12.75
12.88
13
12.98
12.95
12.98
12.99
13
12.91
12.83
12.77
12.76
12.7
12.69
12.71
12.7
12.7
12.69
12.6
12.7
12.75
12.8
12.79
12.79
12.8
12.73
12.64
12.57
12.56
12.45
12.23
12.2
12.25
12.12
12.2
12.22
12.3
12.35
12.31
12.28
12.34
12.32
10/31/05 12.31
FUND SNAPSHOT
------------------------------------
Common Share Price $12.31
------------------------------------
Common Share
Net Asset Value $13.38
------------------------------------
Premium/(Discount) to NAV -8.00%
------------------------------------
Market Yield 6.29%
------------------------------------
Taxable-Equivalent Yield1 8.74%
------------------------------------
Net Assets Applicable to
Common Shares ($000) $578,517
------------------------------------
Average Effective Maturity
on Securities (Years) 17.39
------------------------------------
Leverage-Adjusted Duration 8.94
------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 2/19/93)
------------------------------------
ON SHARE PRICE ON NAV
------------------------------------
1-Year 3.07% 4.87%
------------------------------------
5-Year 6.68% 6.12%
------------------------------------
10-Year 6.67% 5.77%
------------------------------------
STATES
(as a % of total investments)
------------------------------------
Texas 11.6%
------------------------------------
Illinois 9.1%
------------------------------------
Washington 6.6%
------------------------------------
New York 5.9%
------------------------------------
Indiana 5.7%
------------------------------------
California 5.4%
------------------------------------
Michigan 4.2%
------------------------------------
Utah 4.0%
------------------------------------
Colorado 4.0%
------------------------------------
Florida 3.6%
------------------------------------
District of Columbia 3.5%
------------------------------------
New Jersey 3.0%
------------------------------------
Nevada 2.9%
------------------------------------
South Carolina 2.7%
------------------------------------
Rhode Island 2.3%
------------------------------------
Alabama 2.2%
------------------------------------
Puerto Rico 2.0%
------------------------------------
North Carolina 2.0%
------------------------------------
Other 19.3%
------------------------------------
SECTORS
(as a % of total investments)
------------------------------------
Tax Obligation/Limited 15.2%
------------------------------------
Healthcare 14.4%
------------------------------------
Tax Obligation/General 14.3%
------------------------------------
U.S. Guaranteed 13.5%
------------------------------------
Utilities 11.9%
------------------------------------
Transportation 7.1%
------------------------------------
Consumer Staples 5.7%
------------------------------------
Housing/Multifamily 5.4%
------------------------------------
Water and Sewer 5.2%
------------------------------------
Other 7.3%
------------------------------------
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%. When
comparing this Fund to investments that generate qualified dividend income,
the taxable-equivalent yield is lower.
12
Shareholder
MEETING REPORT
The Annual Shareholder Meeting was held on July 26, 2005 at The Northern Trust
Bank, 50 S. LaSalle St., Chicago, Illinois.
NPI NPM NPT
------------------------------------------------------------------------------------------------------------------------------------
APPROVAL OF THE NEW INVESTMENT MANAGEMENT
AGREEMENT WAS REACHED AS FOLLOWS:
Common and Common and Common and
MuniPreferred MuniPreferred MuniPreferred
shares voting shares voting shares voting
together as a class together as a class together as a class
------------------------------------------------------------------------------------------------------------------------------------
For 56,382,930 37,554,584 39,240,994
Against 480,648 460,744 297,387
Abstain 836,340 415,786 352,733
------------------------------------------------------------------------------------------------------------------------------------
Total 57,699,918 38,431,114 39,891,114
====================================================================================================================================
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 57,163,437 -- 37,963,419 -- 39,310,940 --
Withhold 536,481 -- 467,695 -- 580,174 --
------------------------------------------------------------------------------------------------------------------------------------
Total 57,699,918 -- 38,431,114 -- 39,891,114 --
====================================================================================================================================
Lawrence H. Brown
For 57,190,404 -- 37,962,069 -- 39,337,269 --
Withhold 509,514 -- 469,045 -- 553,845 --
------------------------------------------------------------------------------------------------------------------------------------
Total 57,699,918 -- 38,431,114 -- 39,891,114 --
====================================================================================================================================
Jack B. Evans
For 57,169,055 -- 37,965,474 -- 39,318,038 --
Withhold 530,863 -- 465,640 -- 573,076 --
------------------------------------------------------------------------------------------------------------------------------------
Total 57,699,918 -- 38,431,114 -- 39,891,114 --
====================================================================================================================================
William C. Hunter
For 57,173,306 -- 37,957,200 -- 39,319,754 --
Withhold 526,612 -- 473,914 -- 571,360 --
------------------------------------------------------------------------------------------------------------------------------------
Total 57,699,918 -- 38,431,114 -- 39,891,114 --
====================================================================================================================================
David J. Kundert
For 57,171,776 -- 37,967,637 -- 39,322,692 --
Withhold 528,142 -- 463,477 -- 568,422 --
------------------------------------------------------------------------------------------------------------------------------------
Total 57,699,918 -- 38,431,114 -- 39,891,114 --
====================================================================================================================================
William J. Schneider
For -- 17,678 -- 13,321 -- 13,016
Withhold -- 241 -- 78 -- 91
------------------------------------------------------------------------------------------------------------------------------------
Total -- 17,919 -- 13,399 -- 13,107
====================================================================================================================================
Timothy R. Schwertfeger
For -- 17,678 -- 13,318 -- 13,016
Withhold -- 241 -- 81 -- 91
------------------------------------------------------------------------------------------------------------------------------------
Total -- 17,919 -- 13,399 -- 13,107
====================================================================================================================================
Judith M. Stockdale
For 57,169,245 -- 37,967,712 -- 39,324,262 --
Withhold 530,673 -- 463,402 -- 566,852 --
------------------------------------------------------------------------------------------------------------------------------------
Total 57,699,918 -- 38,431,114 -- 39,891,114 --
====================================================================================================================================
Eugene S. Sunshine
For 57,171,507 -- 37,963,681 -- 39,318,914 --
Withhold 528,411 -- 467,433 -- 572,200 --
------------------------------------------------------------------------------------------------------------------------------------
Total 57,699,918 -- 38,431,114 -- 39,891,114 --
====================================================================================================================================
13
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, 2005, 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. We were
not engaged to perform an audit of the Funds' internal control over financial
reporting. Our audits included consideration of internal control over financial
reporting as a basis for designing audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Funds' internal control over financial reporting.
Accordingly, we express no such opinion. An audit also includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements and financial highlights, assessing the accounting principles used
and significant estimates made by management, and evaluating the overall
financial statement presentation. Our procedures included confirmation of
securities owned as of October 31, 2005, by correspondence with the custodian
and brokers or other appropriate auditing procedures where replies from brokers
were not received. 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, 2005,
and the results of their operations for the year then ended, changes in their
net assets for each of the two years in the period then ended, and their
financial highlights for each of the five years in the period then ended in
conformity with U.S. generally accepted accounting principles.
Ernst & Young LLP
Chicago, Illinois
December 14, 2005
14
Nuveen Premium Income Municipal Fund, Inc. (NPI)
Portfolio of
INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
ALABAMA - 1.7% (1.1% OF TOTAL INVESTMENTS)
$ 4,050 Alabama 21st Century Authority, Tobacco Settlement Revenue 6/10 at 102.00 A- $ 4,370,801
Bonds, Series 2000, 6.125%, 12/01/16
2,190 Courtland Industrial Development Board, Alabama, Pollution 6/15 at 100.00 BBB 2,169,677
Control Revenue Bonds, International Paper Company,
Series 2005A, 5.000%, 6/01/25
5,020 DCH Health Care Authority, Alabama, Healthcare Facilities 6/12 at 101.00 A+ 5,247,958
Revenue Bonds, Series 2002, 5.250%, 6/01/18
1,000 Montgomery BMC Special Care Facilities Financing Authority, 11/14 at 100.00 A3 1,016,160
Alabama, Revenue Bonds, Baptist Medical Center,
Series 2004C, 5.250%, 11/15/29
3,330 University of South Alabama, Student Tuition Revenue Bonds, 3/14 at 100.00 Aaa 3,472,058
Series 2004, 5.000%, 3/15/23 - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
ALASKA - 1.0% (0.7% 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 2,158,220
2,035 5.250%, 9/01/18 - FGIC Insured 9/13 at 100.00 AAA 2,193,160
5,000 Northern Tobacco Securitization Corporation, Alaska, Tobacco 6/10 at 100.00 BBB 5,264,900
Settlement Asset-Backed Bonds, Series 2000, 6.500%, 6/01/31
------------------------------------------------------------------------------------------------------------------------------------
ARIZONA - 1.1% (0.7% OF TOTAL INVESTMENTS)
5,700 Pima County Industrial Development Authority, Arizona, Lease 1/06 at 101.00 AAA 5,833,152
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, Series 2002B, 6/12 at 100.00 AAA 4,373,670
5.125%, 6/01/18 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
ARKANSAS - 0.8% (0.5% OF TOTAL INVESTMENTS)
480 Paragould, Arkansas, Water, Sewer and Electric Revenue 12/10 at 100.00 AAA 527,472
Bonds, Series 2000, 5.650%, 12/01/25 (Pre-refunded to
12/01/10) - AMBAC Insured
5,245 University of Arkansas, Fayetteville, Athletic Facilities Revenue 9/09 at 100.00 Aaa 5,466,864
Bonds, Razorback Stadium, Series 1999, 5.050%, 9/15/20 -
AMBAC Insured
2,000 Washington County, Arkansas, Hospital Revenue Bonds, 2/15 at 100.00 BBB 1,974,300
Washington Regional Medical Center, Series 2005B,
5.000%, 2/01/25
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA - 23.7% (15.3% OF TOTAL INVESTMENTS)
1,275 Acalanes Union High School District, Contra Costa County, 8/15 at 100.00 AAA 1,334,517
California, General Obligation Bonds, Series 2005,
5.000%, 8/01/24 - FGIC Insured
9,200 Alameda Corridor Transportation Authority, California, No Opt. Call AAA 4,580,772
Subordinate Lien Revenue Bonds, Series 2004A,
0.000%, 10/01/20 - AMBAC Insured
2,000 California Educational Facilities Authority, Revenue Bonds, 10/15 at 100.00 Aaa 2,076,780
Occidental College, Series 2005A, 5.000%, 10/01/30 -
MBIA Insured
7,200 California Educational Facilities Authority, Revenue Bonds, 10/15 at 100.00 AA+ 7,259,256
University of Southern California, Series 2005, 4.750%, 10/01/28
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 3,727,972
7,000 5.000%, 3/01/33 3/13 at 100.00 A 7,027,230
5,500 California Health Facilities Financing Authority, Health Facility No Opt. Call A- 5,727,755
Revenue Bonds, Catholic Healthcare West, Series 2004I,
4.950%, 7/01/26 (Mandatory put 7/01/14)
9,560 California Health Facilities Financing Authority, Revenue Bonds, 11/15 at 100.00 A3 9,691,641
Cedars-Sinai Medical Center, Series 2005, 5.000%, 11/15/27
15
Nuveen Premium Income Municipal Fund, Inc. (NPI) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA (continued)
$ California, General Obligation Bonds, Series 2004:
5,000 5.000%, 4/01/10 No Opt. Call A $ 5,286,500
2,000 5.125%, 2/01/25 2/14 at 100.00 A 2,080,320
10,000 5.125%, 2/01/26 2/14 at 100.00 A 10,359,800
9,000 California, General Obligation Bonds, Series 2005, 5.000%, 8/01/22 8/15 at 100.00 A 9,376,650
4,000 California Department of Water Resources, Power Supply 5/12 at 101.00 A2 4,528,520
Revenue Bonds, Series 2002A, 6.000%, 5/01/15
4,000 California, Economic Recovery Revenue Bonds, Series 2004A, No Opt. Call AA- 4,416,880
5.250%, 7/01/14
23,725 California State Public Works Board, Lease Revenue Refunding 12/05 at 100.00 Aa2 23,745,641
Bonds, Various University of California Projects, Series 1993A,
5.500%, 6/01/21
11,395 California State Public Works Board, Lease Revenue Bonds, No Opt. Call A- 12,123,027
Department of Corrections, Series 1993E, 5.500%, 6/01/15
1,640 California Statewide Community Development Authority, 7/15 at 100.00 BBB+ 1,665,354
Revenue Bonds, Daughters of Charity Health System,
Series 2005A, 5.250%, 7/01/30
3,575 Chula Vista, California, Industrial Development Revenue Bonds, 6/14 at 102.00 A2 3,760,364
San Diego Gas and Electric Company, Series 1996A,
5.300%, 7/01/21
6,000 Golden State Tobacco Securitization Corporation, California, 6/15 at 100.00 AAA 6,144,360
Tobacco Settlement Asset-Backed Revenue Bonds,
Series 2005A, 5.000%, 6/01/35 - FGIC Insured
2,350 Grossmont-Cuyamaca Community College District, California, 8/15 at 100.00 AAA 2,452,131
General Obligation Bonds, Series 2005B, 5.000%, 8/01/26 -
FGIC Insured
5,120 Los Angeles Community College District, Los Angeles County, 8/15 at 100.00 AAA 5,359,002
California, General Obligation Bonds, Series 2005A,
5.000%, 8/01/24 - FSA Insured
5,470 Los Angeles Harbors Department, California, Revenue Bonds, 8/16 at 102.00 AAA 5,663,966
Series 2006A, 5.000%, 8/01/22 (Alternative Minimum Tax)
(WI, settling 5/04/06) - FGIC Insured
Los Angeles Unified School District, California, General
Obligation Bonds, Series 2005A-1:
5,000 5.000%, 7/01/19 - FGIC Insured 7/15 at 100.00 AAA 5,304,650
6,865 5.000%, 7/01/25 - FGIC Insured 7/15 at 100.00 AAA 7,166,854
1,120 Martinez, California, Home Mortgage Revenue Bonds, No Opt. Call AAA 1,523,346
Series 1983A, 10.750%, 2/01/16
4,750 North Orange County Community College District, California, 8/14 at 100.00 AAA 5,176,218
General Obligation Bonds, Series 2003B, 5.000%, 8/01/20
(Pre-refunded to 8/01/14) - FGIC Insured
Peralta Community College District, Alameda County, California,
General Obligation Bonds, Series 2005D:
1,560 5.000%, 8/01/19 - FSA Insured 8/13 at 102.00 AAA 1,657,625
1,640 5.000%, 8/01/20 - FSA Insured 8/13 at 102.00 AAA 1,733,890
1,720 5.000%, 8/01/21 - FSA Insured 8/13 at 102.00 AAA 1,812,846
1,805 5.000%, 8/01/22 - FSA Insured 8/13 at 102.00 AAA 1,898,030
1,900 5.000%, 8/01/23 - FSA Insured 8/13 at 102.00 AAA 1,993,309
20,000 Pomona, California, GNMA/FNMA Collateralized Securities No Opt. Call AAA 25,855,000
Program Single Family Mortgage Revenue Bonds,
Series 1990A, 7.600%, 5/01/23
5,000 Rancho Mirage Joint Powers Financing Authority, California, 7/14 at 100.00 A3 5,320,550
Revenue Bonds, Eisenhower Medical Center, Series 2004,
5.875%, 7/01/26
2,000 Redwood City School District, San Mateo County, California, 7/12 at 100.00 AAA 2,060,120
General Obligation Bonds, Series 2002, 5.000%, 7/15/27 -
FGIC Insured
3,885 Sacramento City Unified School District, Sacramento County, 7/15 at 100.00 Aaa 4,083,873
California, General Obligation Bonds, Series 2005,
5.000%, 7/01/22 - MBIA Insured
3,700 Sacramento Municipal Utility District, California, Electric 8/13 at 100.00 AAA 3,867,647
Revenue Bonds, Series 2003R, 5.000%, 8/15/22 -
MBIA Insured
3,500 San Diego Unified Port District, California, Revenue Bonds, 9/14 at 100.00 AAA 3,606,890
Series 2004B, 5.000%, 9/01/29 - MBIA Insured
4,700 San Diego Unified School District, San Diego County, 7/15 at 100.00 AAA 4,884,146
California, General Obligation Bonds, Series 2005G,
5.000%, 7/01/29 - FSA Insured
16
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA (continued)
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 $ 2,814,900
24,025 0.000%, 1/15/36 - MBIA Insured No Opt. Call AAA 5,191,562
------------------------------------------------------------------------------------------------------------------------------------
COLORADO - 5.4% (3.5% OF TOTAL INVESTMENTS)
5,620 Adams 12 Five Star Schools, Adams County, Colorado, General 12/15 at 100.00 AAA 5,890,434
Obligation Bonds, Series 2005, 5.000%, 12/15/24 -
FSA Insured
2,500 Centennial Water and Sanitation District, Colorado, Water and 12/14 at 100.00 AAA 2,635,175
Sewerage Revenue Bonds, Series 2004, 5.000%, 12/01/21 -
FGIC Insured
1,000 Colorado Health Facilities Authority, Revenue Bonds, Parkview 9/14 at 100.00 A3 1,006,050
Medical Center, Series 2004, 5.000%, 9/01/25
830 Colorado Housing Finance Authority, Single Family Program 4/10 at 105.00 AA 872,662
Senior Bonds, Series 2000B-2, 7.250%, 10/01/31 (Alternative
Minimum Tax)
520 Colorado Housing Finance Authority, Single Family Program 5/07 at 105.00 Aa2 528,533
Senior Bonds, Series 1997B-2, 7.000%, 5/01/26 (Alternative
Minimum Tax)
360 Colorado Housing Finance Authority, Single Family Program 11/07 at 105.00 Aa2 371,221
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 10,904,450
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 21,632,718
Center, Series 2001A, 5.500%, 9/01/18 (Pre-refunded to
3/01/11) - FSA Insured
8,315 Denver City and County, Colorado, Special Facilities Airport 4/06 at 100.00 N/R 7,301,817
Revenue Bonds, United Air Lines Corporation, Series 1992A,
6.875%, 10/01/32 (Alternative Minimum Tax) #
125 El Paso County, Colorado, FNMA Mortgage-Backed Single No Opt. Call Aaa 125,878
Family Revenue Refunding Bonds, Series 1992A-2,
8.750%, 6/01/11
------------------------------------------------------------------------------------------------------------------------------------
CONNECTICUT - 0.5% (0.3% OF TOTAL INVESTMENTS)
1,930 Connecticut, General Obligation Bonds, Series 2001C, No Opt. Call AA 2,179,433
5.500%, 12/15/16
2,310 Greater New Haven Water Pollution Control Authority, 11/15 at 100.00 AAA 2,401,476
Connecticut, Regional Wastewater System Revenue Bonds,
Series 2005A, 5.000%, 11/15/30 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
DISTRICT OF COLUMBIA - 4.6% (2.9% OF TOTAL INVESTMENTS)
9,505 District of Columbia, General Obligation Bonds, Series 1998B, No Opt. Call AAA 11,213,334
6.000%, 6/01/20 - MBIA Insured
9,335 District of Columbia Housing Finance Agency, GNMA 12/05 at 102.00 AAA 9,578,083
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 10,840,487
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 5,162,571
7,625 0.000%, 4/01/25 - MBIA Insured 4/11 at 44.82 AAA 2,619,721
16,665 0.000%, 4/01/32 - MBIA Insured 4/11 at 29.23 AAA 3,703,130
------------------------------------------------------------------------------------------------------------------------------------
FLORIDA - 2.6% (1.7% OF TOTAL INVESTMENTS)
8,000 Hillsborough County Aviation Authority, Florida, Revenue 10/13 at 100.00 AAA 8,573,840
Bonds, Tampa International Airport, Series 2003A,
5.375%, 10/01/16 (Alternative Minimum Tax) - MBIA Insured
5,400 Hillsborough County Industrial Development Authority, Florida, 4/10 at 101.00 N/R 5,993,568
Exempt Facilities Remarketed 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+ *** 5,700,700
Revenue Bonds, Adventist Health System/Sunbelt Obligated
Group, Series 2000, 6.500%, 11/15/30 (Pre-refunded
to 11/15/10)
2,170 Tallahassee, Florida, Consolidated Utility System Revenue 10/15 at 100.00 AAA 2,270,970
Bonds, Series 2005, 5.000%, 10/01/25 - AMBAC Insured
2,375 Volusia County School Board, Florida, Certificates of 8/15 at 100.00 Aaa 2,476,294
Participation, Series 2005B, 5.000%, 8/01/22 - FSA Insured
17
Nuveen Premium Income Municipal Fund, Inc. (NPI) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
GEORGIA - 1.9% (1.2% OF TOTAL INVESTMENTS)
$ 2,625 Fulton County Development Authority, Georgia, Revenue 5/14 at 100.00 AAA $ 2,807,726
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 6,447,413
Refunding Certificates, Series 2003, 5.250%, 1/01/20 -
FSA Insured
4,845 Metropolitan Atlanta Rapid Transit Authority, Georgia, Sales No Opt. Call AAA 5,728,244
Tax Revenue Refunding Bonds, Series 1992P,
6.250%, 7/01/20 - AMBAC Insured
2,740 Savannah Housing Authority, Georgia, GNMA Collateralized 5/08 at 103.00 Aaa 2,883,247
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 10,770,200
5.250%, 9/01/21 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
IDAHO - 0.6% (0.4% OF TOTAL INVESTMENTS)
5,000 Boise City, Idaho, Airport Revenue Certificates of Participation, 9/10 at 100.00 Aaa 5,295,950
Series 2000, 5.500%, 9/01/25 (Alternative Minimum Tax) -
FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS - 9.6% (6.2% OF TOTAL INVESTMENTS)
9,220 Chicago Board of Education, Illinois, Unlimited Tax General 12/07 at 102.00 AAA 9,650,758
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 5,377,205
10,000 0.000%, 12/01/20 - FGIC Insured No Opt. Call AAA 4,894,100
9,900 0.000%, 12/01/24 - FGIC Insured No Opt. Call AAA 3,893,868
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 6,986,100
10,000 0.000%, 12/01/23 - FGIC Insured No Opt. Call AAA 4,159,600
9,000 Chicago, Illinois, Special Facility Revenue Bonds, O'Hare No Opt. Call N/R 4,089,690
International Airport, United Air Lines Inc. Project,
Series 2001A, 6.375%, 11/01/35 (Alternative Minimum Tax)
(Mandatory put 5/01/13) #
180 Chicago, Illinois, FNMA/GNMA Collateralized Single Family 3/06 at 105.00 Aaa 180,695
Mortgage Revenue Bonds, Series 1996A, 7.000%, 9/01/27
(Alternative Minimum Tax)
445 Chicago, Illinois, FNMA/GNMA Collateralized Single Family 9/07 at 105.00 Aaa 449,775
Mortgage Revenue Bonds, Series 1997B, 6.950%, 9/01/28
(Alternative Minimum Tax)
8,740 Illinois Development Finance Authority, Pollution Control 2/06 at 100.00 AAA 8,779,592
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 1,034,390
3,000 5.250%, 11/15/23 5/14 at 100.00 A 3,094,650
9,820 Illinois Health Facilities Authority, Revenue Bonds, Sherman 8/07 at 101.00 AAA 10,150,345
Health Systems, Series 1997, 5.250%, 8/01/27 - AMBAC Insured
3,905 Kane County School District 131 - Aurora East, Illinois, General 6/15 at 100.00 AAA 4,075,570
Obligation Bonds, Series 2005A, 5.000%, 6/01/24 -
FGIC Insured
10,040 Metropolitan Pier and Exposition Authority, Illinois, Revenue No Opt. Call AAA 6,580,517
Bonds, McCormick Place Expansion Project, Series 1992A,
0.000%, 6/15/15 - FGIC Insured
9,200 Metropolitan Pier and Exposition Authority, Illinois, Revenue 12/09 at 101.00 AAA 9,917,416
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 3,912,870
Bonds, McCormick Place Hospitality Facility, Series 1996A,
7.000%, 7/01/26
3,000 Upper Illinois River Valley Development Authority, Healthcare 12/11 at 101.00 BBB+ 3,276,690
Facilities Revenue Bonds, Morris Hospital, Series 2001,
6.625%, 12/01/31
------------------------------------------------------------------------------------------------------------------------------------
INDIANA - 1.4% (1.0% OF TOTAL INVESTMENTS)
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 1,991,653
2,005 5.000%, 8/01/22 - FSA Insured 8/14 at 100.00 AAA 2,084,799
18
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
INDIANA (continued)
$ 7,965 Wawasee Community School Corporation, Indiana, First 1/12 at 101.00 AA- $ 8,753,774
Mortgage Bonds, New Elementary and Remodeling Building
Corporation, Series 2000, 5.750%, 1/15/20
------------------------------------------------------------------------------------------------------------------------------------
IOWA - 1.4% (0.9% 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 1,284,231
1,410 5.800%, 6/01/18 - MBIA Insured 6/08 at 100.00 AAA 1,492,076
3,000 Iowa Financing Authority, Private College Revenue Refunding 12/05 at 102.00 AAA 3,064,860
Bonds, Drake University Project, Series 1996,
5,400%, 12/01/16 - MBIA Insured
4,365 Iowa Finance Authority, Industrial Remarketed Revenue No Opt. Call AAA 5,486,892
Refunding Bonds, Urbandale Hotel Corporation,
Series 1989A, 8.500%, 8/01/16 (Alternative Minimum Tax)
2,000 Iowa Finance Authority, Healthcare Revenue Bonds, Genesis 7/10 at 100.00 A1 2,130,540
Medical Center, Series 2000, 6.250%, 7/01/25
------------------------------------------------------------------------------------------------------------------------------------
KANSAS - 1.0% (0.8% OF TOTAL INVESTMENTS)
6,000 Kansas Department of Transportation, Highway Revenue Bonds, 3/14 at 100.00 AA+ 6,306,240
Series 2004A, 5.000%, 3/01/21
3,440 Sedgwick and Shawnee Counties, Kansas, GNMA 6/08 at 105.00 Aaa 3,561,948
Mortgage-Backed Securities Program Single Family
Revenue Bonds, Series 1998A-1, 6.500%, 12/01/22
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
KENTUCKY - 1.6% (1.0% OF TOTAL INVESTMENTS)
7,000 Kentucky State Property and Buildings Commission, Revenue 8/15 at 100.00 AAA 7,355,110
Bonds, Project 85, Series 2005, 5.000%, 8/01/22 - FSA Insured
3,770 Kentucky Turnpike Authority, Economic Development Road 7/15 at 100.00 AAA 3,941,799
Revenue Bonds, Revitalization Project, Series 2005B,
5.000%, 7/01/24 - AMBAC Insured
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 1,275,098
1,270 5.000%, 6/01/20 - AMBAC Insured 6/14 at 100.00 Aaa 1,334,592
1,335 5.000%, 6/01/21 - AMBAC Insured 6/14 at 100.00 Aaa 1,399,974
------------------------------------------------------------------------------------------------------------------------------------
LOUISIANA - 2.2% (1.4% OF TOTAL INVESTMENTS)
2,915 Jefferson Sales Tax District, Jefferson Parish, Louisiana, 12/12 at 100.00 AAA 3,061,566
Special Sales Tax Revenue Refunding Bonds, Series 2002,
5.250%, 12/01/19 - AMBAC Insured
610 Louisiana Housing Finance Agency, Single Family Mortgage 9/09 at 101.00 Aaa 622,609
Revenue Bonds, Series 2000A, 7.450%, 12/01/31
(Alternative Minimum Tax)
2,000 Louisiana Public Facilities Authority, Hospital Revenue Bonds, 8/15 at 100.00 A+ 2,038,960
Franciscan Missionaries of Our Lady Health System,
Series 2005A, 5.250%, 8/15/31
7,195 Louisiana Public Facilities Authority, Extended Care Facilities No Opt. Call BBB 9,069,801
Revenue Bonds, Comm-Care Corporation Project, Series 1994,
11.000%, 2/01/14
Louisiana, Gasoline and Fuels Tax Revenue Bonds, Series 2005A:
1,200 5.000%, 5/01/25 - FGIC Insured 5/15 at 100.00 AAA 1,238,004
2,210 5.000%, 5/01/26 - FGIC Insured 5/15 at 100.00 AAA 2,279,991
2,500 5.000%, 5/01/27 - FGIC Insured 5/15 at 100.00 AAA 2,577,225
------------------------------------------------------------------------------------------------------------------------------------
MARYLAND - 0.4% (0.3% OF TOTAL INVESTMENTS)
3,600 Montgomery County Housing Opportunities Commission, 7/10 at 100.00 Aaa 3,758,220
Maryland, Multifamily Housing Development Bonds,
Series 2000B, 6.200%, 7/01/30 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
MASSACHUSETTS - 5.9% (3.8% OF TOTAL INVESTMENTS)
Massachusetts Bay Transportation Authority, Assessment Bonds,
Series 2000A:
7,900 5.250%, 7/01/30 (Pre-refunded to 7/01/10) 7/10 at 100.00 AAA 8,498,899
2,100 5.250%, 7/01/30 7/10 at 100.00 AAA 2,218,860
4,000 Massachusetts, General Obligation Bonds, Series 2003D, 10/13 at 100.00 AA*** 4,346,200
5.250%, 10/01/22 (Pre-refunded to 10/01/13)
5,400 Massachusetts, General Obligation Bonds, Consolidated Loan, 1/13 at 100.00 AAA 5,849,928
Series 2002E, 5.250%, 1/01/21 (Pre-refunded to 1/01/13) -
FSA Insured
19
Nuveen Premium Income Municipal Fund, Inc. (NPI) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
MASSACHUSETTS (continued)
$ 3,395 Massachusetts Health and Educational Facilities Authority, 7/15 at 100.00 BBB $ 3,347,198
Revenue Bonds, UMass Memorial Health Care, Series 2005D,
5.000%, 7/01/33
2,825 Massachusetts Industrial Finance Agency, Resource Recovery 12/08 at 102.00 BBB 2,876,245
Revenue Refunding Bonds, Ogden Haverhill Project,
Series 1998A, 5.450%, 12/01/12 (Alternative Minimum Tax)
8,505 Massachusetts Housing Finance Agency, Rental Housing 1/11 at 100.00 AAA 8,824,873
Mortgage Revenue Bonds, Series 2001A, 5.850%, 7/01/35
(Alternative Minimum Tax) - AMBAC Insured
6,540 Massachusetts School Building Authority, Dedicated Sales 8/15 at 100.00 AAA 6,872,886
Tax Revenue Bonds, Series 2005A, 5.000%, 8/15/22 -
FSA Insured
Massachusetts, Special Obligation Dedicated Tax Revenue
Bonds, Series 2004:
7,000 5.250%, 1/01/22 (Pre-refunded to 1/01/14) - FGIC Insured 1/14 at 100.00 AAA 7,596,470
3,820 5.250%, 1/01/24 (Pre-refunded to 1/01/14) - FGIC Insured 1/14 at 100.00 AAA 4,145,502
1,500 Massachusetts Water Resources Authority, General Revenue 8/17 at 100.00 AAA 1,629,540
Bonds, Series 2005A, 5.250%, 8/01/25 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
MICHIGAN - 3.8% (2.5% 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 3,758,330
1,275 5.250%, 4/01/23 - XLCA Insured 4/13 at 100.00 AAA 1,343,315
3,930 Hudsonville Public Schools, Ottawa and Allegan Counties, 5/08 at 100.00 AAA 4,062,048
Michigan, Unlimited Tax General Obligation School Building
and Site Refunding Bonds, Series 1997, 5.150%, 5/01/22 -
FGIC Insured
3,000 Kent Hospital Finance Authority, Michigan, Revenue Bonds, 7/15 at 100.00 BBB 3,187,560
Metropolitan Hospital, Series 2005A, 6.000%, 7/01/35
10,000 Michigan State Building Authority, Revenue Refunding Bonds, 10/13 at 100.00 AAA 10,426,100
Facilities Program, Series 2003II, 5.000%, 10/15/23 -
MBIA Insured
6,600 Michigan Housing Development Authority, Limited Obligation 7/07 at 102.00 AAA 6,743,484
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 6,786,372
Metropolitan Airport, Series 2002D, 5.500%, 12/01/19
(Alternative Minimum Tax) - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
MINNESOTA - 5.2% (3.3% OF TOTAL INVESTMENTS)
13,650 Cohasset, Minnesota, Pollution Control Revenue Bonds, 7/14 at 100.00 A 13,667,199
Allete Inc., Series 2004, 4.950%, 7/01/22
2,000 Duluth Economic Development Authority, Minnesota, Healthcare 2/14 at 100.00 A- 2,089,560
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 1,079,860
2,000 6.200%, 2/20/43 8/11 at 105.00 A1 2,152,020
3,000 Minneapolis-St. Paul Metropolitan Airports Commission, 1/08 at 101.00 AAA 3,101,700
Minnesota, Airport Revenue Bonds, Series 1998A,
5.000%, 1/01/22 - AMBAC Insured
1,500 Minnesota Municipal Power Agency, Electric Revenue Bonds, 10/14 at 100.00 A3 1,585,215
Series 2004A, 5.250%, 10/01/24
700 Minnesota Higher Education Facilities Authority, St. John's 10/15 at 100.00 A2 727,153
University Revenue Bonds, Series 2005-6G, 5.000%, 10/01/22
90 Minnesota Agricultural and Economic Development Board, 11/07 at 102.00 AAA 95,491
Healthcare System Revenue Bonds, Fairview Hospital and
Healthcare Services, Series 1997A, 5.750%, 11/15/26 -
MBIA Insured
1,545 St. Paul Housing and Redevelopment Authority, Minnesota, 11/15 at 100.00 Baa3 1,667,642
Revenue Bonds, Healtheast Inc., Series 2005, 6.000%, 11/15/25
18,485 St. Paul Housing and Redevelopment Authority, Minnesota, 11/15 at 103.00 AAA 22,746,162
Sales Tax Revenue Refunding Bonds, Civic Center Project,
Series 1996, 7.100%, 11/01/23 - FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
MISSISSIPPI - 0.5% (0.3% OF TOTAL INVESTMENTS)
4,275 Mississippi Hospital Equipment and Facilities Authority, 9/14 at 100.00 N/R 4,280,771
Revenue Bonds, Baptist Memorial Healthcare, Series 2004B-1,
5.000%, 9/01/24
20
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
MISSOURI - 2.8% (1.8% OF TOTAL INVESTMENTS)
$ 2,000 Cole County Industrial Development Authority, Missouri, 2/14 at 100.00 N/R $ 2,051,660
Revenue Bonds, Lutheran Senior Services - Heisinger
Project, Series 2004, 5.250%, 2/01/24
920 Missouri Housing Development Commission, GNMA/FNMA 3/07 at 105.00 AAA 930,240
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:
1,500 5.250%, 6/01/21 (Pre-refunded to 6/01/11) - AMBAC Insured 6/11 at 101.00 AAA 1,635,780
1,500 5.250%, 6/01/21 - AMBAC Insured 6/11 at 101.00 AAA 1,591,890
4,150 5.250%, 6/01/28 (Pre-refunded to 6/01/11) - AMBAC Insured 6/11 at 101.00 AAA 4,510,303
3,825 Missouri Housing Development Commission, Single Family 3/09 at 103.00 AAA 3,852,311
Mortgage Revenue Bonds, Homeownership Loan Program,
Series 1999B-1, 6.700%, 9/01/30 (Alternative Minimum Tax)
Missouri Development Finance Board, Infrastructure Facilities
Revenue Bonds, Branson Landing Project, Series 2005A:
1,565 6.000%, 6/01/20 No Opt. Call BBB+ 1,769,968
1,260 5.000%, 6/01/35 6/15 at 100.00 BBB+ 1,262,797
8,500 St. Charles County Francis Howell School District, Missouri, No Opt. Call AAA 9,006,770
General Obligation Refunding Bonds, Series 1994A,
7.800%, 3/01/08 - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
NEBRASKA - 0.9% (0.6% OF TOTAL INVESTMENTS)
4,060 Lincoln, Nebraska, Electric System Revenue Bonds, 9/12 at 100.00 AA 4,224,065
Series 2002, 5.000%, 9/01/23
4,410 University of Nebraska, Lincoln, Student Fees and Facilities 11/13 at 100.00 Aa2 4,519,897
Revenue Bonds, Series 2003B, 5.000%, 7/01/33
------------------------------------------------------------------------------------------------------------------------------------
NEVADA - 4.7% (3.1% OF TOTAL INVESTMENTS)
15,000 Clark County, Nevada, General Obligation Bank Bonds, 6/11 at 100.00 AAA 15,898,650
Southern Nevada Water Authority Loan, Series 2001,
5.250%, 6/01/26 - FGIC Insured
2,810 Clark County School District, Nevada, General Obligation 12/11 at 100.00 AAA 3,095,524
Bonds, Series 2001F, 5.500%, 6/15/18 (Pre-refunded to
12/15/11) - FSA Insured
10,410 Clark County School District, Nevada, General Obligation 6/12 at 100.00 AAA 11,481,293
Bonds, Series 2002C, 5.500%, 6/15/18 (Pre-refunded to
6/15/12) - 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 1,978,258
12,000 5.375%, 1/01/40 - AMBAC Insured 1/10 at 100.00 AAA 12,401,040
------------------------------------------------------------------------------------------------------------------------------------
NEW HAMPSHIRE - 0.3% (0.2% OF TOTAL INVESTMENTS)
2,170 New Hampshire Housing Finance Agency, Single Family 1/06 at 100.00 Aa2 2,196,734
Residential Mortgage Bonds, Series 1993B, 6.050%, 7/01/25
570 New Hampshire Housing Finance Agency, Single Family 7/06 at 102.00 Aa2 584,598
Mortgage Acquisition Revenue Bonds, Series 1996B,
6.400%, 1/01/27 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
NEW JERSEY - 8.5% (5.5% OF TOTAL INVESTMENTS)
10,150 Delaware River Port Authority, Pennsylvania and New Jersey, 1/10 at 100.00 AAA 10,889,428
Revenue Bonds, Port District Project, Series 1999B,
5.625%, 1/01/26 - FSA Insured
Essex County, New Jersey, General Obligation Bonds, Series 2005A:
3,065 5.000%, 5/01/24 - MBIA Insured 5/15 at 100.00 Aaa 3,222,326
3,030 5.000%, 5/01/25 - MBIA Insured 5/15 at 100.00 Aaa 3,183,136
8,000 Essex County Improvement Authority, New Jersey, General 10/10 at 100.00 Aaa 8,878,800
Obligation Guaranteed Lease Revenue Bonds, County
Correctional Facility Project, Series 2000, 6.000%, 10/01/25
(Pre-refunded to 10/01/10) - FGIC Insured
500 Middlesex County Improvement Authority, New Jersey, Senior No Opt. Call Baa3 507,870
Revenue Bonds, Heldrich Center Hotel/Conference Center
Project, Series 2005A, 5.000%, 1/01/15
1,500 New Jersey Educational Facilities Authority, Revenue Bonds, 7/15 at 100.00 AAA 1,571,955
Princeton University, Series 2005A, 5.000%, 7/01/30
21
Nuveen Premium Income Municipal Fund, Inc. (NPI) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
NEW JERSEY (continued)
$ 5,315 New Jersey Housing and Mortgage Finance Agency, 10/07 at 101.50 AAA $ 5,471,527
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 (Pre-refunded to 6/15/13) 6/13 at 100.00 AAA 5,543,400
5,410 5.500%, 6/15/20 (Pre-refunded to 6/15/13) 6/13 at 100.00 AAA 5,997,959
9,250 5.500%, 6/15/23 (Pre-refunded to 6/15/13) 6/13 at 100.00 AAA 10,255,290
9,130 New Jersey Turnpike Authority, Revenue Bonds, Series 2005A, 1/15 at 100.00 AAA 9,577,644
5.000%, 1/01/25 - FSA Insured
2,500 New Jersey Turnpike Authority, Revenue Bonds, Series 2003A, 7/13 at 100.00 AAA 2,628,950
5.000%, 1/01/19 - FGIC Insured
New Jersey Turnpike Authority, Revenue Bonds, Series 2000A:
3,915 6.000%, 1/01/14 - MBIA Insured No Opt. Call AAA 4,486,512
7,585 6.000%, 1/01/14 - MBIA Insured No Opt. Call AAA 8,692,258
------------------------------------------------------------------------------------------------------------------------------------
NEW MEXICO - 0.8% (0.5% OF TOTAL INVESTMENTS)
970 New Mexico Mortgage Finance Authority, Single Family 3/10 at 102.50 AAA 1,005,308
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 6,513,059
Receipts Tax Revenue Bonds, Series 1997, 6.000%, 2/01/27 -
FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK - 17.1% (11.0% OF TOTAL INVESTMENTS)
14,580 Long Island Power Authority, New York, Electric System General 6/08 at 101.00 A- 15,254,471
Revenue Bonds, Series 1998A, 5.250%, 12/01/26
3,000 Metropolitan Transportation Authority, New York, Transportation 11/12 at 100.00 AAA 3,184,440
Revenue Refunding Bonds, Series 2002A, 5.125%, 11/15/21 -
FGIC Insured
4,500 Metropolitan Transportation Authority, New York, Transportation 11/15 at 100.00 AAA 4,678,200
Revenue Bonds, Series 2005B, 5.000%, 11/15/30 -
AMBAC Insured
2,000 New York Counties Tobacco Trust I, Tobacco Settlement 6/10 at 101.00 BBB 2,141,180
Pass-Through Bonds, Series 2000, 6.500%, 6/01/35
8,270 New York City, New York, General Obligation Bonds, No Opt. Call A+ 8,794,566
Fiscal Series 2004G, 5.000%, 8/01/14
5,000 New York City, New York, General Obligation Bonds, 6/13 at 100.00 A+ 5,349,500
Fiscal Series 2003J, 5.500%, 6/01/23
12,500 New York City, New York, General Obligation Bonds, 10/13 at 100.00 A+ 13,185,000
Fiscal Series 2003D, 5.250%, 10/15/22
6,000 New York City, New York, General Obligation Bonds, 8/14 at 100.00 A+ 6,356,760
Fiscal Series 2004C, 5.250%, 8/15/20
7,960 New York City, New York, General Obligation Bonds, 4/15 at 100.00 A+ 8,185,507
Fiscal Series 2005M, 5.000%, 4/01/24
1,250 New York City Municipal Water Finance Authority, New York, 6/15 at 100.00 AAA 1,301,788
Water and Sewerage System Revenue Bonds, Fiscal
Series 2005C, 5.000%, 6/15/25 - MBIA Insured
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 2,352,895
2,050 5.250%, 7/01/21 7/14 at 100.00 Aa2 2,205,369
2,420 5.250%, 7/01/22 4/14 at 100.00 Aa2 2,587,440
1,370 5.250%, 7/01/24 4/14 at 100.00 Aa2 1,460,694
1,145 Dormitory Authority of the State of New York, Revenue 2/15 at 100.00 AAA 1,192,850
Bonds, Mental Health Services Facilities Improvements,
Series 2005B, 5.000%, 2/15/24 - AMBAC Insured
3,500 Dormitory Authority of the State of New York, Revenue Bonds, 2/15 at 100.00 AAA 3,648,995
Mental Health Services Facilities Improvements, Series 2005D,
5.000%, 2/15/23 - FGIC Insured
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+ 1,094,393
1,000 5.250%, 7/01/22 7/14 at 100.00 A+ 1,063,230
500 5.250%, 7/01/24 7/14 at 100.00 A+ 530,135
1,995 Dormitory Authority of the State of New York, State and Local 7/14 at 100.00 AA- 2,113,762
Appropriation Lease Bonds, Upstate Community Colleges,
Series 2004B, 5.250%, 7/01/20
2,730 New York State Medical Care Facilities Finance Agency, 2/06 at 100.00 AAA 2,763,170
FHA-Insured Hospital and Nursing Home Mortgage Revenue
Bonds, Series 1993B, 5.500%, 2/15/22
22
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK (continued)
New York State Thruway Authority, General Revenue Bonds,
Series 2005G:
$ 3,770 5.000%, 1/01/25 - FSA Insured 7/15 at 100.00 AAA $ 3,935,767
5,980 5.000%, 1/01/26 - FSA Insured 7/15 at 100.00 AAA 6,247,725
New York State Thruway Authority, Highway and Bridge Trust
Fund Bonds, Second Generation, Series 2005B:
5,000 5.000%, 4/01/21 - AMBAC Insured 10/15 at 100.00 AAA 5,273,800
2,000 5.000%, 4/01/22 - AMBAC Insured 10/15 at 100.00 AAA 2,102,920
3,000 New York State Thruway Authority, State Personal Income 3/15 at 100.00 AAA 3,180,630
Tax Revenue Bonds, Series 2005A, 5.000%, 3/15/19 -
FSA Insured
6,460 New York State Urban Development Corporation, State 3/14 at 100.00 AAA 6,717,173
Personal Income Tax Revenue Bonds, Series 2004A-1,
5.000%, 3/15/26 - FGIC Insured
14,000 New York State Urban Development Corporation, Service No Opt. Call AA- 15,062,040
Contract Revenue Bonds, Correctional and Youth Facilities,
Series 2002A, 5.500%, 1/01/17 (Mandatory put 1/01/11)
5,000 Port Authority of New York and New Jersey, Consolidated 3/14 at 101.00 AAA 5,203,050
Revenue Bonds, One Hundred Thirty-Fifth Series 2004,
5.000%, 9/15/28 - XLCA Insured
New York City Sales Tax Asset Receivable Corporation, New York,
Dedicated Revenue Bonds, Local Government Assistance
Corporation, Series 2004A:
4,825 5.000%, 10/15/24 - MBIA Insured 10/14 at 100.00 AAA 5,053,657
1,665 5.000%, 10/15/25 - MBIA Insured 10/14 at 100.00 AAA 1,741,390
7,400 New York State Tobacco Settlement Financing Corporation, 6/10 at 100.00 AA- 7,903,496
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, General 11/12 at 100.00 Aa2 9,868,863
Purpose Revenue Refunding Bonds, Series 2002B,
5.000%, 11/15/22
------------------------------------------------------------------------------------------------------------------------------------
NORTH CAROLINA - 1.1% (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+ 6,098,952
3,475 5.250%, 6/01/23 6/13 at 100.00 AA+ 3,656,708
1,000 Gaston County Industrial Facilities and Pollution Control 8/15 at 100.00 N/R 1,037,000
Financing Authority, North Carolina, National Gypsum
Company Project Exempt Facilities Revenue Bonds,
Series 2005, 5.750%, 8/01/35 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
NORTH DAKOTA - 1.2% (0.8% OF TOTAL INVESTMENTS)
9,650 Dickinson, North Dakota, Health Care Facilities Revenue 2/10 at 102.00 AA 11,114,002
Bonds, BHS Long Term Care Inc., Series 1990,
7.625%, 2/15/20 - RAAI Insured
------------------------------------------------------------------------------------------------------------------------------------
OHIO - 2.0% (1.3% OF TOTAL INVESTMENTS)
4,265 Franklin County, Ohio, Hospital Revenue and Improvement 5/11 at 101.00 Aaa 4,685,017
Bonds, Children's Hospital Project, Series 2001,
5.500%, 5/01/28 (Pre-refunded to 5/01/11) - AMBAC Insured
1,785 Marysville, Ohio, Wastewater Treatment System First 12/15 at 100.00 AAA 1,869,181
Mortgage Revenue Bonds, Series 2005, 5.000%, 12/01/24 -
MBIA Insured
2,720 Ohio State University, General Receipts Bonds, Series 2003B, 6/13 at 100.00 AA 2,927,509
5.250%, 6/01/20
2,000 Richland County, Ohio, Hospital Facilities Revenue Refunding 11/10 at 101.00 A- 2,168,440
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 7,622,300
and Improvement Bonds, Trinity Health System, Series 2000,
6.500%, 10/01/30
------------------------------------------------------------------------------------------------------------------------------------
OREGON - 1.0% (0.6% OF TOTAL INVESTMENTS)
2,500 Oregon State Department of Transportation, Highway User 11/14 at 100.00 AA+ 2,632,750
Tax Revenue Bonds, Series 2004A, 5.000%, 11/15/21
Oregon Department of Administrative Services, Certificates
of Participation, Series 2005A:
2,060 5.000%, 5/01/24 - FSA Insured 5/15 at 100.00 AAA 2,144,563
4,220 5.000%, 5/01/30 - FSA Insured 5/15 at 100.00 AAA 4,347,106
23
Nuveen Premium Income Municipal Fund, Inc. (NPI) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
PENNSYLVANIA - 6.2% (4.0% OF TOTAL INVESTMENTS)
$ 2,945 Bucks County, Pennsylvania, General Obligation Bonds, No Opt. Call Aa2 $ 3,155,126
Series 2005, 5.000%, 6/01/15
Chester County, Pennsylvania, General Obligation Bonds,
Series 2005:
1,000 5.000%, 11/15/23 5/15 at 100.00 Aa1 1,047,500
2,440 5.000%, 11/15/24 5/15 at 100.00 Aa1 2,550,093
2,625 Delaware County, Pennsylvania, General Obligation Bonds, 10/15 at 100.00 AA 2,768,745
Series 2005, 5.000%, 10/01/21
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+ 1,434,457
1,960 5.250%, 4/15/17 4/13 at 100.00 A+ 2,085,362
Montgomery County Industrial Development Authority,
Pennsylvania, Revenue Bonds, Hill School, Series 2005:
4,000 5.000%, 8/15/25 - MBIA Insured 8/15 at 100.00 Aaa 4,177,640
2,000 5.000%, 8/15/26 - MBIA Insured 8/15 at 100.00 Aaa 2,088,820
3,300 5.000%, 8/15/27 - MBIA Insured 8/15 at 100.00 Aaa 3,443,880
1,000 Pennsylvania State University, General Revenue Bonds, 9/15 at 100.00 AA 1,036,500
Series 2005, 5.000%, 9/01/29
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 4,679,073
4,735 5.000%, 9/01/22 - FSA Insured 9/14 at 100.00 AAA 4,903,945
8,405 Philadelphia Redevelopment Authority, Pennsylvania, 4/08 at 103.00 N/R 8,352,889
Multifamily Housing Mortgage Revenue Bonds, Cricket Court
Apartments, Series 1998A, 6.200%, 4/01/25 (Alternative
Minimum Tax)
2,000 Pittsburgh Water and Sewerage Authority, Pennsylvania, 9/15 at 100.00 AAA 2,068,180
First Lien Water and Sewerage System Revenue Bonds,
Series 2005, 5.000%, 9/01/29 - MBIA Insured
14,000 State Public School Building Authority, Pennsylvania, Lease 6/13 at 100.00 AAA 15,002,120
Revenue Bonds, Philadelphia School District, Series 2003,
5.250%, 6/01/24 - FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
PUERTO RICO - 0.2% (0.1% OF TOTAL INVESTMENTS)
1,500 Puerto Rico Electric Power Authority, Power Revenue Bonds, 7/15 at 100.00 AAA 1,557,585
Series 2005RR, 5.000%, 7/01/30 - XLCA Insured
------------------------------------------------------------------------------------------------------------------------------------
SOUTH CAROLINA - 6.7% (4.3% OF TOTAL INVESTMENTS)
8,610 Dorchester County School District 2, South Carolina, 12/14 at 100.00 A 8,962,924
Installment Purchase Revenue Bonds, GROWTH, Series 2004,
5.250%, 12/01/24
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- 5,384,966
3,595 5.250%, 12/01/20 12/13 at 100.00 AA- 3,795,817
1,865 5.250%, 12/01/21 12/13 at 100.00 AA- 1,966,587
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 1,986,727
2,400 5.500%, 5/01/24 5/14 at 100.00 A 2,518,704
15,000 South Carolina JOBS Economic Development Authority, 8/13 at 100.00 BBB+ 16,598,400
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:
8,915 6.000%, 5/15/22 5/11 at 101.00 BBB 9,460,331
7,500 6.375%, 5/15/28 5/11 at 101.00 BBB 8,056,050
4,150 6.375%, 5/15/30 No Opt. Call BBB 4,711,869
------------------------------------------------------------------------------------------------------------------------------------
SOUTH DAKOTA - 0.2% (0.2% OF TOTAL INVESTMENTS)
2,045 South Dakota State University, Revenue Bonds, Housing and 4/14 at 100.00 AAA 2,147,332
Auxiliary Facilities, Series 2004, 5.000%, 4/01/20 -
MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
TENNESSEE - 0.4% (0.3% OF TOTAL INVESTMENTS)
3,710 Tennessee Housing Development Agency, Homeownership 7/13 at 100.00 AA 3,785,016
Program Bonds, Series 2004, 5.000%, 7/01/34 (Alternative
Minimum Tax)
24
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
TEXAS - 12.5% (8.1% OF TOTAL INVESTMENTS)
$ 10,205 Alliance Airport Authority, Texas, Special Facilities Revenue 12/05 at 100.00 CCC $ 7,707,939
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 3,633,819
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 Bonds, 10/13 at 101.00 Baa2 2,379,685
TXU Energy Company LLC Project, Series 2003C,
6.750%, 10/01/38 (Alternative Minimum Tax)
175 Clear Creek Independent School District, Galveston and Harris 2/10 at 100.00 AAA 191,651
Counties, Texas, Unlimited Tax Schoolhouse and Refunding
Bonds, Series 2000, 6.000%, 2/15/16
690 Harlingen Housing Finance Corporation, Texas, GNMA/FNMA 9/10 at 105.00 AAA 708,092
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 4,128,200
Revenue Refunding Bonds, Series 2001B, 5.250%, 11/15/40 -
MBIA Insured
Harris County Hospital District, Texas, Revenue Refunding
Bonds, Series 1990:
2,335 7.400%, 2/15/10 - AMBAC Insured No Opt. Call AAA 2,479,233
5,145 7.400%, 2/15/10 - AMBAC Insured No Opt. Call AAA 5,592,666
19,125 Harris County Hospital District, Texas, Revenue Refunding 8/10 at 100.00 AAA 20,899,418
Bonds, Series 2000, 6.000%, 2/15/15 - MBIA Insured
6,000 Houston, Texas, General Obligation Public Improvement Bonds, 3/11 at 100.00 AAA 6,492,420
Series 2001B, 5.500%, 3/01/15 - FSA Insured
9,250 Houston, Texas, Subordinate Lien Airport System Revenue 7/10 at 100.00 AAA 9,875,393
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 5,308,850
Bonds, Series 2004A, 5.250%, 5/15/25 - MBIA Insured
Kerrville Health Facilities Development Corporation, Texas,
Revenue Bonds, Sid Peterson Memorial Hospital Project, Series 2005:
2,000 5.250%, 8/15/21 No Opt. Call BBB- 2,048,580
2,500 5.125%, 8/15/26 No Opt. Call BBB- 2,480,850
3,400 Lower Colorado River Authority, Texas, Revenue Refunding 5/13 at 100.00 AAA 3,625,420
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 1,601,380
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+*** 4,597,120
Texas, Hospital Revenue Bonds, Adventist Health System -
Sunbelt Obligated Group, Series 2000, 6.700%, 11/15/30
(Pre-refunded to 11/15/10)
10,810 Tarrant County Health Facilities Development Corporation, 12/10 at 105.00 Aaa 12,176,060
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 5,357,450
Refunding and Improvement Bonds, Series 1999,
5.250%, 3/01/17 - FSA Insured
4,000 Texas A&M University, Financing System Revenue Bonds, 5/09 at 100.00 AAA 4,290,640
Series 1999, 5.550%, 5/15/29 (Pre-refunded to 5/15/09) -
MBIA Insured
25,000 Texas Turnpike Authority, First Tier Revenue Bonds, Central No Opt. Call AAA 9,988,500
Texas Turnpike System, Series 2002A, 0.000%, 8/15/24 -
AMBAC Insured
2,500 Tomball Hospital Authority, Texas, Hospital Revenue Bonds, 7/15 at 100.00 Baa3 2,499,825
Tomball Regional Hospital, Series 2005, 5.000%, 7/01/20
(WI, settling 11/15/05)
------------------------------------------------------------------------------------------------------------------------------------
UTAH - 0.2% (0.1% OF TOTAL INVESTMENTS)
1,595 Utah Housing Finance Agency, Single Family Mortgage Bonds, 7/07 at 101.50 Aaa 1,634,763
Series 1997F, 5.750%, 7/01/28 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
VIRGINIA - 0.5% (0.3% OF TOTAL INVESTMENTS)
4,835 Virginia Beach Development Authority, Virginia, Multifamily 10/14 at 100.00 N/R 5,099,426
Residential Rental Housing Revenue Bonds, Mayfair
Apartments I and II, Series 1999, 7.500%, 10/01/39
(Alternative Minimum Tax)
25
Nuveen Premium Income Municipal Fund, Inc. (NPI) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
WASHINGTON - 6.4% (4.1% 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 $ 12,148,005
(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 8,202,560
(Optional put 7/01/09) (Mandatory put 7/01/27)
2,500 Energy Northwest, Washington, Electric Revenue Refunding 7/12 at 100.00 AAA 2,765,200
Bonds, Columbia Generating Station - Nuclear Project 2,
Series 2002C, 5.750%, 7/01/17 - MBIA Insured
3,125 Skagit County Public Hospital District 1, Washington, 6/14 at 100.00 Aaa 3,383,844
General Obligation Bonds, Series 2004A, 5.375%, 12/01/20 -
MBIA Insured
5,000 Snohomish County, Washington, Limited Tax General Obligation 12/11 at 100.00 AAA 5,267,550
Bonds, Series 2001, 5.250%, 12/01/26 - MBIA Insured
11,000 Washington, General Obligation Bonds, Series 2000S-5, No Opt. Call AAA 5,656,750
0.000%, 1/01/20 - FGIC Insured
4,750 Washington State Healthcare Facilities Authority, Revenue 11/08 at 101.00 Aaa 4,919,765
Bonds, Swedish Health Services, Series 1998,
5.125%, 11/15/22 - AMBAC Insured
9,350 Washington Public Power Supply System, Revenue Refunding 7/07 at 102.00 Aaa 9,798,052
Bonds, Nuclear Project 3, Series 1997A, 5.250%, 7/01/15
7,775 Washington Public Power Supply System, Revenue Refunding 7/08 at 102.00 Aaa 8,130,007
Bonds, Nuclear Project 3, Series 1998A, 5.125%, 7/01/18
------------------------------------------------------------------------------------------------------------------------------------
WISCONSIN - 2.9% (1.9% 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 1,047,640
1,345 5.125%, 8/01/23 - AMBAC Insured 8/13 at 100.00 AAA 1,406,384
Wisconsin, General Obligation Bonds, Series 2004-3:
1,720 5.250%, 5/01/19 - FGIC Insured 5/14 at 100.00 AAA 1,849,892
1,265 5.250%, 5/01/21 - FGIC Insured 5/14 at 100.00 AAA 1,356,786
1,000 Wisconsin Health and Educational Facilities Authority, Revenue 7/11 at 100.00 A- 1,061,130
Bonds, Agnesian Healthcare Inc., Series 2001, 6.000%, 7/01/21
2,175 Wisconsin Health and Educational Facilities Authority, Revenue 10/11 at 100.00 BBB 2,327,009
Bonds, Carroll College Inc., Series 2001, 6.125%, 10/01/16
2,000 Wisconsin Health and Educational Facilities Authority, Revenue 8/13 at 100.00 A 2,057,100
Bonds, Wheaton Franciscan Services Inc., Series 2003A,
5.250%, 8/15/25
9,000 Wisconsin Health and Educational Facilities Authority, Revenue 4/13 at 100.00 BBB+ 9,809,190
Bonds, Aurora Healthcare Inc., Series 2003, 6.400%, 4/15/33
6,025 Wisconsin Health and Educational Facilities Authority, Revenue 9/13 at 100.00 A- 6,498,081
Bonds, Franciscan Sisters of Christian Charity Healthcare
Ministry, Series 2003A, 6.000%, 9/01/22
------------------------------------------------------------------------------------------------------------------------------------
$ 1,498,884 Total Long-Term Investments (cost $1,415,869,511) - 154.6% 1,464,308,534
=============-----------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 0.8% 8,137,070
--------------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (55.4)% (525,000,000)
--------------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 947,445,604
====================================================================================================================
(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. Certain
mortgage-backed securities may be subject to periodic
principal paydowns.
** 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, UAL Corporation, 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.
26
Nuveen Premium Income Municipal Fund 2, Inc. (NPM)
Portfolio of
INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
ALABAMA - 1.9% (1.2% OF TOTAL INVESTMENTS)
$ 1,560 Courtland Industrial Development Board, Alabama, Pollution 6/15 at 100.00 BBB $ 1,545,523
Control Revenue Bonds, International Paper Company,
Series 2005A, 5.000%, 6/01/25
1,690 Montgomery BMC Special Care Facilities Financing Authority, 11/14 at 100.00 A3 1,717,310
Alabama, Revenue Bonds, Baptist Medical Center,
Series 2004C, 5.250%, 11/15/29
8,255 University of South Alabama, Student Tuition Revenue Bonds, 3/14 at 100.00 Aaa 8,589,493
Series 2004, 5.000%, 3/15/24 - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
ARIZONA - 0.9% (0.6% OF TOTAL INVESTMENTS)
2,850 Maricopa County Industrial Development Authority, Arizona, 1/07 at 102.00 AAA 3,062,411
Multifamily Housing Revenue Bonds, Place Five and The
Greenery Apartments, Series 1996A, 6.625%, 1/01/27
2,480 Pima County Industrial Development Authority, Arizona, Lease 1/06 at 101.00 AAA 2,537,933
Obligation Revenue Refunding Bonds, Tucson Electric Power
Company, Series 1988A, 7.250%, 7/15/10 - FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
ARKANSAS - 0.2% (0.1% OF TOTAL INVESTMENTS)
1,000 Washington County, Arkansas, Hospital Revenue Bonds, 2/15 at 100.00 BBB 987,150
Washington Regional Medical Center, Series 2005B,
5.000%, 2/01/25
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA - 15.2% (9.8% 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 1,371,397
5,890 0.000%, 10/01/24 - MBIA Insured No Opt. Call Aaa 2,348,166
7,615 0.000%, 10/01/25 - MBIA Insured No Opt. Call Aaa 2,869,941
6,240 California Health Facilities Financing Authority, Revenue Bonds, 11/15 at 100.00 A3 6,325,925
Cedars-Sinai Medical Center, Series 2005, 5.000%, 11/15/27
2,055 California Infrastructure Economic Development Bank, 10/14 at 100.00 AA 2,139,666
Infrastructure State Revolving Fund Revenue Bonds,
Series 2004, 5.000%, 10/01/21
California, General Obligation Bonds, Series 2004:
5,000 5.000%, 4/01/10 No Opt. Call A 5,286,500
8,000 5.125%, 2/01/25 2/14 at 100.00 A 8,321,280
3,500 California, General Obligation Bonds, Series 2005, 8/15 at 100.00 A 3,646,475
5.000%, 8/01/22
5,690 California Department of Veterans Affairs, Home Purchase 6/12 at 101.00 AAA 5,956,064
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 4,528,520
5,500 5.375%, 5/01/21 5/12 at 101.00 A2 5,936,865
2,500 California, Economic Recovery Revenue Bonds, No Opt. Call AA- 2,760,550
Series 2004A, 5.250%, 7/01/14
1,900 Chula Vista, California, Industrial Development Revenue Bonds, 6/14 at 102.00 A2 1,998,515
San Diego Gas and Electric Company, Series 1996A,
5.300%, 7/01/21
2,170 Cotati-Rohnert Park Unified School District, Sonoma County, 8/15 at 100.00 Aaa 2,281,842
California, General Obligation Bonds, Series 2005,
5.000%, 8/01/22 - FGIC Insured
30,000 Foothill/Eastern Transportation Corridor Agency, California, No Opt. Call AAA 14,785,500
Toll Road Revenue Bonds, Series 1995A, 0.000%, 1/01/21
2,790 Los Angeles County Metropolitan Transportation Authority, 7/15 at 100.00 AAA 2,919,372
California, Proposition A First Tier Senior Sales Tax Revenue
Bonds, Series 2005A, 5.000%, 7/01/24 - AMBAC Insured
2,500 Oakland Redevelopment Agency, California, Tax Allocation 9/15 at 100.00 AAA 2,613,475
Bonds, Central District Redevelopment Project, Series 2005,
5.000%, 9/01/22 - AMBAC Insured
27
Nuveen Premium Income Municipal Fund 2, Inc. (NPM) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA (continued)
$ 1,420 Perris, California, Special Tax Bonds, Community Facilities 9/15 at 102.00 N/R $ 1,387,596
District 2001-1, May Farms Improvement Area 4,
Series 2005A, 5.000%, 9/01/25
2,220 San Diego Redevelopment Agency, California, Subordinate 9/14 at 100.00 AAA 2,302,495
Lien Tax Allocation Bonds, Centre City Project, Series 2004A,
5.000%, 9/01/20 - XLCA Insured
1,655 San Diego County, California, Certificates of Participation, 2/15 at 100.00 AAA 1,720,108
Edgemoor Facility Project and Regional System,
Series 2005, 5.000%, 2/01/23 - AMBAC Insured
960 San Francisco Redevelopment Agency, California, Hotel Tax 1/06 at 101.00 AAA 979,997
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 6,472,920
Bonds, Merged Area Redevelopment Project, Series 2004A,
5.250%, 8/01/19 - MBIA Insured
2,000 Sonoma County Junior College District, California, General 8/13 at 100.00 AAA 2,179,600
Obligation Bonds, Series 2003A, 5.000%, 8/01/27
(Pre-refunded to 8/01/13) - FSA Insured
3,000 Walnut Energy Center Authority, California, Electric Revenue 1/14 at 100.00 AAA 3,073,560
Bonds, Turlock Irrigation District, Series 2004A,
5.000%, 1/01/34 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
COLORADO - 0.7% (0.4% OF TOTAL INVESTMENTS)
1,700 Centennial Water and Sanitation District, Colorado, Water 12/14 at 100.00 AAA 1,786,683
and Sewerage Revenue Bonds, Series 2004,
5.000%, 12/01/22 - FGIC Insured
200 Colorado Housing Finance Authority, Single Family Program 12/05 at 105.00 Aa2 200,856
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 461,564
Bonds, Series 1991D, 7.750%, 11/15/13 (Alternative
Minimum Tax)
1,700 Denver, Colorado, FHA-Insured Multifamily Housing Revenue 10/07 at 102.00 AAA 1,742,636
Bonds, Boston Lofts Project, Series 1997A, 5.750%, 10/01/27
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
CONNECTICUT - 2.4% (1.6% OF TOTAL INVESTMENTS)
3,170 Connecticut Housing Finance Authority, Housing Mortgage 5/06 at 102.00 AAA 3,257,936
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 8,721,179
3,000 5.000%, 1/01/24 - FGIC Insured 1/14 at 100.00 AAA 3,129,510
------------------------------------------------------------------------------------------------------------------------------------
DISTRICT OF COLUMBIA - 1.9% (1.2% 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 3,543,776
13,780 0.000%, 4/01/28 - MBIA Insured 4/11 at 37.21 AAA 3,904,701
15,855 0.000%, 4/01/29 - MBIA Insured 4/11 at 35.07 AAA 4,234,078
------------------------------------------------------------------------------------------------------------------------------------
FLORIDA - 3.2% (2.1% OF TOTAL INVESTMENTS)
1,700 Miami-Dade County, Florida, Beacon Tradeport Community 5/12 at 102.00 AA 1,816,144
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 5,187,850
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 2,546,950
Facility Revenue Refunding Bonds, Baptist Hospital and
Baptist Manor, Series 1998, 5.125%, 10/01/19
760 Florida Housing Finance Corporation, Homeowner Mortgage 1/10 at 100.00 AAA 789,845
Revenue Bonds, Series 2000-11, 5.850%, 1/01/22 (Alternative
Minimum Tax) - FSA Insured
3,600 Hillsborough County Industrial Development Authority, Florida, 4/10 at 101.00 N/R 3,995,712
Exempt Facilities Remarketed Revenue Bonds, National
Gypsum Company, Apollo Beach Project, Series 2000B,
7.125%, 4/01/30 (Alternative Minimum Tax)
Volusia County, Florida, Tax Revenue Bonds, Tourist
Development, Series 2004:
2,445 5.000%, 12/01/22 - FSA Insured 12/14 at 100.00 Aaa 2,565,930
2,650 5.000%, 12/01/23 - FSA Insured 12/14 at 100.00 Aaa 2,774,974
28
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
GEORGIA - 1.9% (1.3% OF TOTAL INVESTMENTS)
$ 500 Chatham County Hospital Authority, Savannah, Georgia, 1/14 at 100.00 A- $ 518,175
Hospital Revenue Bonds, Memorial Health University
Medical Center Inc., Series 2004A, 5.375%, 1/01/26
1,745 Columbus, Georgia, Water and Sewerage Revenue Bonds, 5/14 at 100.00 AAA 1,821,728
Series 2005, 5.000%, 5/01/24 - MBIA Insured
150 Fulton County Housing Authority, Georgia, GNMA 9/06 at 102.00 AAA 154,260
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:
10 5.250%, 11/01/15 (Pre-refunded to 11/01/13) - MBIA Insured 11/13 at 100.00 AAA 10,960
3,405 5.250%, 11/01/15 - MBIA Insured 11/13 at 100.00 AAA 3,684,278
3,365 5.000%, 11/01/18 - MBIA Insured 11/13 at 100.00 AAA 3,543,984
2,235 Richmond County Development Authority, Georgia, Revenue 12/14 at 100.00 AAA 2,327,082
Bonds, Medical College of Georgia, Cancer Research
Center Project, Series 2004A, 5.000%, 12/15/24 -
AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
IDAHO - 1.5% (0.9% OF TOTAL INVESTMENTS)
435 Idaho Housing Agency, Senior Lien Single Family Mortgage 1/06 at 102.00 Aaa 444,353
Bonds, Series 1995F, 6.450%, 7/01/27 (Alternative Minimum Tax)
3,185 Idaho Housing Agency, FHA-Insured Mortgage Revenue Bonds, 12/05 at 102.00 Aa2 3,237,648
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 3,548,964
Revenue Refunding Bonds, Wedgewood Terrace Project,
Series 2002A-1, 7.250%, 3/20/37
455 Idaho Housing and Finance Association, Single Family Mortgage 7/06 at 102.00 Aaa 461,921
Bonds, Series 1996G, 6.350%, 7/01/26 (Alternative Minimum Tax)
595 Idaho Housing and Finance Association, Single Family Mortgage 1/10 at 100.00 Aa2 622,727
Bonds, Series 2000B, 6.250%, 7/01/22 (Alternative Minimum Tax)
720 Idaho Housing and Finance Association, Single Family Mortgage 7/10 at 100.00 Aaa 722,750
Bonds, Series 2000E, 5.950%, 7/01/20 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS - 16.7% (10.8% OF TOTAL INVESTMENTS)
11,200 Chicago, Illinois, General Obligation Bonds, Series 1995A-1, 1/06 at 102.00 AAA 11,448,640
5.125%, 1/01/25 - AMBAC Insured
22,670 Chicago, Illinois, General Obligation Bonds, City Colleges No Opt. Call AAA 8,963,718
of Chicago Capital Improvement Project, Series 1999,
0.000%, 1/01/25 - FGIC Insured
Chicago, Illinois, General Obligation Refunding Bonds, Series 1998:
120 5.250%, 1/01/20 (Pre-refunded to 7/01/08) - FGIC Insured 7/08 at 102.00 AAA 128,360
880 5.250%, 1/01/20 - FGIC Insured 7/08 at 102.00 AAA 930,477
5,000 Chicago Board of Education, Illinois, Unlimited Tax General No Opt. Call AAA 2,448,450
Obligation Bonds, Dedicated Tax Revenues, Series 1999A,
0.000%, 12/01/20 - FGIC Insured
1,175 Chicago, Illinois, GNMA Collateralized Multifamily Housing 6/09 at 102.00 Aaa 1,220,531
Revenue Bonds, Bryn Mawr-Belle Shores Project,
Series 1997, 5.800%, 6/01/23 (Alternative Minimum Tax)
3,465 Chicago, Illinois, Tax Increment Allocation Bonds, Read-Dunning 1/07 at 102.00 N/R 3,639,047
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 3,727,115
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 2,385,893
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 3,053,589
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 2,914,844
Obligation Bonds, Series 2003, 5.250%, 10/01/15
2,780 East Saint Louis, Illinois, FHA-Insured Section 8 Assisted 1/06 at 100.00 AAA 2,783,141
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 2,121,500
4,420 5.250%, 11/15/15 5/14 at 100.00 A 4,671,719
29
Nuveen Premium Income Municipal Fund 2, Inc. (NPM) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS (continued)
Illinois Finance Authority, Revenue Bonds, University of Chicago,
Series 2004A:
$ 1,000 5.000%, 7/01/24 7/14 at 100.00 Aa1 $ 1,035,130
1,000 5.000%, 7/01/25 7/14 at 100.00 Aa1 1,033,680
3,000 Illinois Health Facilities Authority, Revenue Refunding Bonds, No Opt. Call A+ 3,374,130
Lutheran General Health System, Series 1993C, 6.000%, 4/01/18
3,000 Illinois Health Facilities Authority, Revenue Bonds, Lake Forest 7/13 at 100.00 A- 3,197,730
Hospital, Series 2003, 6.000%, 7/01/33
Illinois Housing Development Authority, Housing Finance Bonds,
Series 2000A:
720 5.750%, 9/01/10 (Alternative Minimum Tax) 3/10 at 100.00 AA 733,342
1,245 6.200%, 9/01/20 (Alternative Minimum Tax) 3/10 at 100.00 AA 1,281,416
11,000 Illinois, General Obligation Bonds, Illinois FIRST Program, No Opt. Call AAA 13,353,560
Series 2001, 6.000%, 11/01/26 - FGIC Insured
2,000 Illinois, General Obligation Bonds, Illinois FIRST Program, 2/12 at 100.00 AAA 2,171,800
Series 2002, 5.500%, 2/01/18 - FGIC Insured
4,020 Lake, Cook, Kane and McHenry Counties Community Unit No Opt. Call AAA 4,428,713
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 1,667,681
1,740 0.000%, 11/01/21 - FSA Insured No Opt. Call Aaa 805,759
Lombard Public Facilities Corporation, Illinois, Second Tier
Conference Center and Hotel Revenue Bonds, Series 2005B:
855 5.250%, 1/01/25 1/16 at 100.00 AA- 894,014
1,750 5.250%, 1/01/30 1/16 at 100.00 AA- 1,818,355
17,945 McHenry and Kane Counties Community Consolidated School No Opt. Call Aaa 8,261,699
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 4,794,311
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 1,409,750
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 2,608,682
Bonds, McCormick Place Expansion Project, Series 2002A,
5.000%, 12/15/28 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
INDIANA - 3.6% (2.4% OF TOTAL INVESTMENTS)
1,000 Ball State University, Indiana, Student Fee Revenue Bonds, 1/12 at 100.00 AAA 1,098,750
Series 2002K, 5.750%, 7/01/20 - FGIC Insured
6,031 Greenfield, Indiana, GNMA Multifamily Housing Revenue 12/05 at 105.00 Aaa 6,216,453
Bonds, Pedcor Investments Project, Series 1996A,
6.200%, 12/01/28 (Alternative Minimum Tax)
3,500 Indiana Bond Bank, Special Program Bonds, East Chicago 2/10 at 101.00 AAA 3,857,490
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*** 874,391
4,195 5.375%, 12/01/25 12/10 at 100.00 Aa2 4,480,092
Indiana University, Student Fee Revenue Bonds, Series 2004P:
2,750 5.000%, 8/01/22 - AMBAC Insured 8/14 at 100.00 AAA 2,863,493
1,600 5.000%, 8/01/24 - AMBAC Insured 8/14 at 100.00 AAA 1,658,992
1,550 St. Joseph County Hospital Authority, Indiana, Revenue Bonds, 2/15 at 100.00 BBB 1,545,521
Madison Center Inc., Series 2005, 5.250%, 2/15/23
------------------------------------------------------------------------------------------------------------------------------------
IOWA - 2.0% (1.3% OF TOTAL INVESTMENTS)
8,000 Iowa Finance Authority, Hospital Facilities Revenue Bonds, 7/08 at 102.00 AAA 8,519,200
Iowa Health System, Series 1998A, 5.125%, 1/01/28
(Pre-refunded to 7/01/08) - MBIA Insured
2,000 Iowa Finance Authority, Healthcare Revenue Bonds, Genesis 7/10 at 100.00 A1 2,130,540
Medical Center, Series 2000, 6.250%, 7/01/25
30
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
IOWA (continued)
$ 2,000 Iowa Tobacco Settlement Authority, Tobacco Settlement 6/11 at 101.00 BBB $ 2,030,420
Asset-Backed Revenue Bonds, Series 2001B, 5.300%, 6/01/25
------------------------------------------------------------------------------------------------------------------------------------
KANSAS - 0.2% (0.1% OF TOTAL INVESTMENTS)
1,000 Johnson County Unified School District 232, Kansas, 3/15 at 100.00 Aaa 1,049,760
General Obligation Bonds, Series 2005, 5.000%, 3/01/23 -
MBIA Insured
155 Sedgwick and Shawnee Counties, Kansas, GNMA Collateralized No Opt. Call Aaa 156,428
Single Family Mortgage Revenue Refunding Bonds,
Series 1994A-1, 7.900%, 5/01/24 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
LOUISIANA - 2.8% (1.8% OF TOTAL INVESTMENTS)
770 Bossier Public Trust Financing Authority, Louisiana, Single 2/06 at 102.00 AAA 784,722
Family Mortgage Revenue Refunding Bonds, Series 1995B,
6.125%, 8/01/28
3,205 East Baton Rouge Parish Mortgage Finance Authority, 4/06 at 102.00 Aaa 3,265,895
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 3,390,402
Special Sales Tax Revenue Refunding Bonds, Series 2002,
5.250%, 12/01/21 - AMBAC Insured
4,000 Louisiana Public Facilities Authority, Hospital Revenue Bonds, 8/15 at 100.00 A+ 4,077,920
Franciscan Missionaries of Our Lady Health System,
Series 2005A, 5.250%, 8/15/31
2,440 New Orleans Home Mortgage Authority, Louisiana, 12/05 at 101.50 Aaa 2,472,720
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 3,567,814
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 Authority, 7/14 at 100.00 A 1,464,560
Revenue Bonds, LifeBridge Health System, Series 2004A,
5.250%, 7/01/19
------------------------------------------------------------------------------------------------------------------------------------
MASSACHUSETTS - 6.1% (3.9% 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 12,349,848
1,850 5.250%, 1/01/21 (Pre-refunded to 1/01/13) - FSA Insured 1/13 at 100.00 AAA 2,004,142
1,000 Massachusetts Development Finance Authority, Revenue 10/14 at 100.00 BBB 1,043,890
Bonds, Hampshire College, Series 2004, 5.700%, 10/01/34
2,700 Massachusetts Development Finance Agency, Pioneer Valley No Opt. Call N/R 2,958,525
Resource Recovery Revenue Bonds, Eco/Springfield LLC,
Series 2000A, 8.375%, 7/01/14 (Alternative Minimum Tax)
2,750 Massachusetts Health and Educational Facilities Authority, 5/12 at 100.00 AAA 2,847,103
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 9,786,881
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 (Pre-refunded to 1/01/14) - FGIC Insured 1/14 at 100.00 AAA 2,441,723
4,000 5.250%, 1/01/24 (Pre-refunded to 1/01/14) - FGIC Insured 1/14 at 100.00 AAA 4,340,840
------------------------------------------------------------------------------------------------------------------------------------
MICHIGAN - 3.3% (2.2% 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 3,600,200
7,955 0.000%, 12/01/22 No Opt. Call AAA 3,533,611
8,260 0.000%, 12/01/23 No Opt. Call AAA 3,472,421
8,575 0.000%, 12/01/24 No Opt. Call AAA 3,410,621
1,200 Kent Hospital Finance Authority, Michigan, Revenue Bonds, 7/15 at 100.00 BBB 1,275,024
Metropolitan Hospital, Series 2005A, 6.000%, 7/01/35
2,000 Michigan State Hospital Finance Authority, Revenue Refunding No Opt. Call BB- 2,001,100
Bonds, Detroit Medical Center Obligated Group, Series 1993A,
6.375%, 8/15/09
31
Nuveen Premium Income Municipal Fund 2, Inc. (NPM) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
MICHIGAN (continued)
$ 3,270 Romulus Community Schools, Wayne County, Michigan, 5/13 at 100.00 AA $ 3,412,866
General Obligation Bonds, Series 2003, 5.000%, 5/01/22
------------------------------------------------------------------------------------------------------------------------------------
MINNESOTA - 4.4% (2.8% OF TOTAL INVESTMENTS)
8,165 Cohasset, Minnesota, Pollution Control Revenue Bonds, 7/14 at 100.00 A 8,175,288
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+ 1,094,070
1,050 5.875%, 12/01/29 12/13 at 100.00 BBB+ 1,118,691
3,000 Minneapolis-St. Paul Metropolitan Airports Commission, 1/11 at 100.00 AAA 3,160,440
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 2,534,064
Minnesota, Airport Revenue Bonds, Series 2001A,
5.250%, 1/01/25 - FGIC Insured
1,000 Minnesota Municipal Power Agency, Electric Revenue Bonds, 10/14 at 100.00 A3 1,062,850
Series 2004A, 5.250%, 10/01/19
1,060 Minnesota Housing Finance Agency, Single Family Mortgage 7/09 at 100.00 AA+ 1,085,313
Revenue Bonds, Series 2000C, 6.100%, 7/01/30 (Alternative
Minimum Tax)
365 Minnesota Housing Finance Agency, Rental Housing Bonds, 2/06 at 101.00 AAA 369,949
Series 1995D, 5.950%, 2/01/18 - MBIA Insured
820 Minnesota Housing Finance Agency, Single Family Mortgage 1/06 at 102.00 AA+ 837,728
Bonds, Series 1996G, 6.250%, 7/01/26 (Alternative
Minimum Tax)
1,435 Minnesota Housing Finance Agency, Single Family Remarketed 1/11 at 101.00 AA+ 1,475,682
Mortgage Bonds, Series 1998H-2, 6.050%, 7/01/31
(Alternative Minimum Tax)
1,375 Minnesota Higher Education Facilities Authority, St. John's 10/15 at 100.00 A2 1,428,336
University Revenue Bonds, Series 2005-6G, 5.000%, 10/01/22
1,620 St. Louis Park, Minnesota, Revenue Bonds, Park Nicollet Health 7/14 at 100.00 A 1,704,791
Services, Series 2003B, 5.500%, 7/01/25
1,000 St. Paul Housing and Redevelopment Authority, Minnesota, 11/15 at 100.00 Baa3 1,079,380
Revenue Bonds, Healtheast Inc., Series 2005, 6.000%, 11/15/25
2,000 Southern Minnesota Municipal Power Agency, Power Supply 1/06 at 100.00 AAA 2,055,800
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 2,478,341
Revenue Bonds, Baptist Memorial Healthcare, Series 2004B-1,
5.000%, 9/01/24
------------------------------------------------------------------------------------------------------------------------------------
MISSOURI - 7.2% (4.6% OF TOTAL INVESTMENTS)
2,000 Cole County Industrial Development Authority, Missouri, 2/14 at 100.00 N/R 2,051,660
Revenue Bonds, Lutheran Senior Services - Heisinger Project,
Series 2004, 5.250%, 2/01/24
2,885 Joplin Industrial Development Authority, Missouri, Health 2/15 at 102.00 BBB+ 3,022,009
Facilities Revenue Bonds, Freeman Health System,
Series 2004, 5.500%, 2/15/24
9,000 Kansas City, Missouri, Airport Revenue Bonds, General 9/12 at 100.00 AAA 9,627,480
Improvement Projects, Series 2003B, 5.250%, 9/01/17 -
FGIC Insured
6,445 Missouri, Water Pollution Control Revenue Refunding Bonds, 10/12 at 100.00 AAA 6,826,093
Series 2002B, 5.000%, 10/01/18
4,095 Missouri, General Obligation Refunding Bonds, Fourth State 10/12 at 100.00 AAA 4,316,376
Building, Series 2002A, 5.000%, 10/01/18
Missouri Health and Educational Facilities Authority, Revenue
Bonds, SSM Healthcare System, Series 2001A:
1,250 5.250%, 6/01/21 (Pre-refunded to 6/01/11) - AMBAC Insured 6/11 at 101.00 AAA 1,363,150
1,250 5.250%, 6/01/21 - AMBAC Insured 6/11 at 101.00 AAA 1,326,575
2,000 5.250%, 6/01/28 (Pre-refunded to 6/01/11) - AMBAC Insured 6/11 at 101.00 AAA 2,173,640
2,500 Missouri Health and Educational Facilities Authority, Revenue 5/13 at 100.00 AA 2,592,450
Bonds, BJC Health System, Series 2003, 5.125%, 5/15/24
32
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
MISSOURI (continued)
$ 1,200 Missouri Health and Educational Facilities Authority, Revenue 2/14 at 100.00 BBB+ $ 1,231,524
Bonds, Lake Regional Health System, Series 2003,
5.125%, 2/15/18
Missouri Development Finance Board, Infrastructure Facilities
Revenue Bonds, Branson Landing Project, Series 2005A:
780 6.000%, 6/01/20 No Opt. Call BBB+ 882,157
1,225 5.000%, 6/01/35 6/15 at 100.00 BBB+ 1,227,719
5,500 St. Louis County Industrial Development Authority, 12/05 at 100.00 N/R 5,515,950
Missouri, 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 2,278,870
Development Program, Series 2001A, 5.125%, 7/01/22 -
MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
NEBRASKA - 0.3% (0.2% OF TOTAL INVESTMENTS)
1,470 Municipal Energy Agency of Nebraska, Power Supply System 4/13 at 100.00 AAA 1,576,149
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 4,185,720
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 6,034,160
Improvement Revenue Bonds, Series 2003, 5.000%, 7/01/23 -
AMBAC Insured
4,000 Clark County, Nevada, Industrial Development Revenue Bonds, 12/05 at 100.00 AAA 4,160,240
Nevada Power Company, 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 11,481,293
Bonds, Series 2002C, 5.500%, 6/15/18 (Pre-refunded to
6/15/12) - MBIA Insured
7,315 Washoe County School District, Nevada, General Obligation No Opt. Call AAA 8,197,774
Bonds, Series 2002B, 5.500%, 6/01/17 - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
NEW JERSEY - 4.1% (2.6% OF TOTAL INVESTMENTS)
5,615 Essex County Improvement Authority, New Jersey, Lease 12/13 at 100.00 Aaa 5,973,012
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 4,505,976
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 AAA 3,769,512
System Bonds, Series 2003C, 5.500%, 6/15/22 (Pre-refunded
to 6/15/13)
3,000 New Jersey Turnpike Authority, Revenue Bonds, Series 2005A, 1/15 at 100.00 AAA 3,149,430
5.000%, 1/01/24 - FSA Insured
4,000 New Jersey Turnpike Authority, Revenue Bonds, Series 2003A, 7/13 at 100.00 AAA 4,206,320
5.000%, 1/01/19 - FGIC Insured
3,435 Union County Utilities Authority, New Jersey, Solid Waste 6/08 at 101.00 AAA 3,572,434
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 - 0.2% (0.1% OF TOTAL INVESTMENTS)
1,005 New Mexico Mortgage Finance Authority, Single Family 1/06 at 102.00 AAA 1,021,392
Mortgage Program Bonds, Series 1995E-2, 6.300%, 7/01/17
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK - 17.8% (11.5% OF TOTAL INVESTMENTS)
1,250 Hempstead Town Industrial Development Agency, New York, 10/15 at 100.00 A- 1,269,300
Revenue Bonds, Adelphi University, Civic Facility Project,
Series 2005, 5.000%, 10/01/30
2,375 Long Island Power Authority, New York, Electric System 6/08 at 101.00 AAA 2,485,176
General Revenue Bonds, Series 1998A, 5.125%, 12/01/22 -
FSA Insured
1,000 Metropolitan Transportation Authority, New York, Transportation No Opt. Call A 1,062,350
Revenue Bonds, Series 2005C, 5.000%, 11/15/16 (WI, settling
11/02/05)
12,020 New York City, New York, General Obligation Bonds, 4/07 at 101.00 Aaa 12,681,941
Fiscal Series 1997I, 6.250%, 4/15/27 (Pre-refunded to 4/15/07)
33
Nuveen Premium Income Municipal Fund 2, Inc. (NPM) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK (continued)
New York City, New York, General Obligation Bonds, Fiscal
Series 1996J:
$ 20 5.875%, 2/15/19 (Pre-refunded to 2/15/06) 2/06 at 101.50 A+*** $ 20,471
80 5.875%, 2/15/19 2/06 at 101.50 A+ 81,722
20 5.500%, 2/15/26 (Pre-refunded to 2/15/06) 2/06 at 101.50 A+*** 20,450
2,120 5.500%, 2/15/26 No Opt. Call A+ 2,169,566
4,000 New York City, New York, General Obligation Bonds, 8/14 at 100.00 A+ 4,237,840
Fiscal Series 2004C, 5.250%, 8/15/20
2,150 New York City, New York, General Obligation Bonds, 3/15 at 100.00 A+ 2,207,147
Fiscal Series 2005J, 5.000%, 3/01/25
5,000 New York City, New York, General Obligation Bonds, 4/15 at 100.00 A+ 5,141,650
Fiscal Series 2005M, 5.000%, 4/01/24
4,000 New York City Trust for Cultural Resources, New York, Revenue 4/07 at 101.00 AAA 4,160,120
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 AAA 7,126,969
7,260 5.000%, 8/01/24 8/13 at 100.00 AAA 7,511,632
2,500 New York City Transitional Finance Authority, New York, 2/14 at 100.00 AAA 2,601,800
Future Tax Secured Bonds, Fiscal Series 2004C,
5.000%, 2/01/22
1,500 Dormitory Authority of the State of New York, State and Local 7/14 at 100.00 AA- 1,591,515
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 2,157,865
2,080 6.375%, 7/01/17 - RAAI Insured 7/09 at 101.00 AA 2,272,587
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+ 6,398,880
5,100 5.250%, 6/01/21 6/13 at 100.00 A+ 5,431,551
5,980 New York State Thruway Authority, General Revenue Bonds, 7/15 at 100.00 AAA 6,247,725
Series 2005G, 5.000%, 1/01/26 - FSA Insured
New York State Thruway Authority, Highway and Bridge Trust
Fund Bonds, Second Generation, Series 2005B:
3,770 5.000%, 4/01/21 - AMBAC Insured 10/15 at 100.00 AAA 3,976,445
3,625 5.000%, 4/01/22 - AMBAC Insured 10/15 at 100.00 AAA 3,811,543
2,135 5.000%, 4/01/23 - AMBAC Insured 10/15 at 100.00 AAA 2,239,594
2,835 5.000%, 4/01/24 - AMBAC Insured 10/15 at 100.00 AAA 2,966,913
6,250 Port Authority of New York and New Jersey, Special Project No Opt. Call AAA 7,055,438
Bonds, JFK International Air Terminal LLC, Sixth Series 1997,
6.250%, 12/01/15 (Alternative Minimum Tax) - MBIA Insured
2,000 Port Authority of New York and New Jersey, Consolidated 6/15 at 101.00 AA- 2,154,120
Revenue Bonds, One Hundred Fortieth Series 2005,
5.000%, 12/01/16
5,000 New York City Sales Tax Asset Receivable Corporation, 10/14 at 100.00 AAA 5,259,650
New York, Dedicated Revenue Bonds, Local Government
Assistance Corporation, Series 2004A, 5.000%, 10/15/22 -
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- 3,631,336
2,000 5.500%, 6/01/19 6/13 at 100.00 AA- 2,180,160
------------------------------------------------------------------------------------------------------------------------------------
NORTH CAROLINA - 1.6% (1.1% OF TOTAL INVESTMENTS)
2,550 Cumberland County, North Carolina, Hospital Facility Revenue 10/09 at 101.00 A- 2,625,225
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 2,636,339
FHA-Insured Mortgage Loan Revenue Bonds, Durham
Hosiery Mill, Series 1987, 7.500%, 8/01/29 (Alternative
Minimum Tax)
715 North Carolina Housing Finance Agency, Single Family Revenue 3/06 at 102.00 AA 733,747
Bonds, Series 1996JJ, 6.450%, 9/01/27 (Alternative
Minimum Tax)
34
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
NORTH CAROLINA (continued)
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+ $ 1,296,075
2,445 5.000%, 2/01/22 2/14 at 100.00 AA+ 2,533,436
------------------------------------------------------------------------------------------------------------------------------------
NORTH DAKOTA - 0.3% (0.2% OF TOTAL INVESTMENTS)
1,605 North Dakota Housing Finance Agency, Home Mortgage 7/10 at 100.00 Aa3 1,611,340
Finance Program Bonds, Series 2000C, 6.150%, 7/01/31
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
OHIO - 4.1% (2.6% OF TOTAL INVESTMENTS)
3,000 Columbus City School District, Franklin County, Ohio, General 12/14 at 100.00 AAA 3,220,500
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 2,486,646
4,105 5.250%, 5/15/18 - MBIA Insured 5/13 at 100.00 AAA 4,367,351
2,000 Ohio Housing Finance Agency, FHA-Insured Multifamily 1/08 at 102.00 Aa2 2,034,980
Housing Mortgage Revenue Bonds, Courtyards of Kettering,
Series 1998B-1, 5.550%, 1/01/40 (Alternative Minimum Tax)
6,250 Ohio Water Development Authority, Solid Waste Disposal 9/08 at 102.00 N/R 6,287,750
Revenue Bonds, Bay Shore Power, Series 1998A,
5.875%, 9/01/20 (Alternative Minimum Tax)
6,600 Ohio Water Development Authority, Solid Waste Disposal 9/09 at 102.00 N/R 6,823,476
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 5,204,600
Bonds, Series 2001A-1, 5.625%, 6/01/31 (Alternative
Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
OREGON - 1.7% (1.1% OF TOTAL INVESTMENTS)
7,860 Multnomah County Hospital Facilities Authority, Oregon, 10/14 at 100.00 AA 8,521,891
Revenue Bonds, Sisters of Providence Health System,
Series 2004, 5.500%, 10/01/21
920 Oregon, General Obligation Veterans Welfare Bonds, Series 75, 4/06 at 102.00 AA- 938,593
6.000%, 4/01/27
995 Portland, Oregon, Limited Tax General Obligation and 6/06 at 100.00 Aa2 1,008,462
Improvement Bonds, Series 1996A, 5.550%, 6/01/16
------------------------------------------------------------------------------------------------------------------------------------
PENNSYLVANIA - 1.6% (1.1% OF TOTAL INVESTMENTS)
3,500 Allegheny County Sanitary Authority, Pennsylvania, Sewerage 12/15 at 100.00 AAA 3,662,155
Revenue Bonds, Series 2005A, 5.000%, 12/01/23 - MBIA Insured
1,500 Annville-Cleona School District, Lebanon County, Pennsylvania, 3/15 at 100.00 Aaa 1,722,225
General Obligation Bonds, Series 2005, 6.000%, 3/01/28 -
FSA Insured
1,355 Chester County, Pennsylvania, General Obligation Bonds, 5/15 at 100.00 Aa1 1,419,363
Series 2005, 5.000%, 11/15/23
875 Delaware County, Pennsylvania, General Obligation Bonds, 10/15 at 100.00 AA 922,915
Series 2005, 5.000%, 10/01/21
1,050 Delaware Valley Regional Finance Authority, Pennsylvania, No Opt. Call AAA 1,189,356
Local Government Revenue Bonds, Series 1997B,
5.700%, 7/01/27 - AMBAC Insured
1,000 Pennsylvania State University, General Revenue Bonds, 9/15 at 100.00 AA 1,036,500
Series 2005, 5.000%, 9/01/29
------------------------------------------------------------------------------------------------------------------------------------
RHODE ISLAND - 2.9% (1.9% OF TOTAL INVESTMENTS)
1,055 Rhode Island Health and Educational Building Corporation, 3/12 at 101.00 AA 1,084,730
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 10,563,200
6,000 6.125%, 6/01/32 6/12 at 100.00 BBB 6,362,340
------------------------------------------------------------------------------------------------------------------------------------
SOUTH CAROLINA - 9.8% (6.3% OF TOTAL INVESTMENTS)
14,000 Berkeley County School District, South Carolina, Installment 12/13 at 100.00 A- 14,474,180
Purchase Revenue Bonds, Securing Assets for Education,
Series 2003, 5.250%, 12/01/24
35
Nuveen Premium Income Municipal Fund 2, Inc. (NPM) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
SOUTH CAROLINA (continued)
$ 15,445 Greenville County School District, South Carolina, Installment 12/12 at 101.00 AA-*** $ 17,577,955
Purchase Revenue Bonds, Series 2002, 5.875%, 12/01/17
(Pre-refunded to 12/01/12)
2,500 Greenville, South Carolina, Hospital Facilities Revenue Refunding 5/13 at 100.00 AAA 2,578,825
Bonds, Series 2003A, 5.000%, 5/01/25 - AMBAC Insured
7,600 Piedmont Municipal Power Agency, South Carolina, Electric 1/06 at 100.00 AAA 6,973,380
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- 6,283,440
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+ 1,735,560
5,000 6.375%, 8/01/34 8/13 at 100.00 BBB+ 5,532,800
5,000 Tobacco Settlement Revenue Management Authority, 5/11 at 101.00 BBB 5,305,850
South Carolina, Tobacco Settlement Asset-Backed Bonds,
Series 2001B, 6.000%, 5/15/22
------------------------------------------------------------------------------------------------------------------------------------
TENNESSEE - 0.3% (0.1% OF TOTAL INVESTMENTS)
1,500 Memphis-Shelby County Airport Authority, Tennessee, Airport 3/10 at 101.00 AAA 1,622,595
Revenue Bonds, Series 1999D, 6.000%, 3/01/19 (Alternative
Minimum Tax) - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
TEXAS - 13.2% (8.5% OF TOTAL INVESTMENTS)
4,000 Austin, Texas, Airport System Prior Lien Revenue Bonds, 11/13 at 100.00 AAA 4,282,560
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 2,511,535
Events Center, Series 1999, 6.000%, 11/15/25 (Pre-refunded
to 11/15/09) - FGIC Insured
5,000 Brazos River Authority, Texas, Pollution Control Revenue 5/08 at 102.00 AAA 5,334,000
Refunding Bonds, Texas Utilities Electric Company,
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 Bonds, 4/08 at 102.00 AAA 5,326,750
Texas Utilities Electric Company, 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 Baa2 6,058,058
Refunding Bonds, TXU Electric Company, 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- 10,828,900
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*** 3,701,176
Series 2001, 5.625%, 2/15/19 (Pre-refunded to 2/15/12)
5,000 Gulf Coast Industrial Development Authority, Texas, Waste 6/08 at 102.00 BBB- 5,052,000
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 2,899,428
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 1,019,410
1,000 5.000%, 12/01/21 12/14 at 100.00 A 1,017,120
2,500 5.125%, 12/01/22 12/14 at 100.00 A 2,565,625
10,850 Houston, Texas, Hotel Occupancy Tax and Special Revenue No Opt. Call AAA 4,082,204
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 4,252,960
Bonds, Series 2004A, 5.250%, 5/15/24 - FGIC Insured
6,185 Keller Independent School District, Tarrant County, Texas, 8/11 at 100.00 AAA 6,452,254
Unlimited Tax General Obligation Refunding Bonds,
Series 2001, 5.250%, 8/15/26
36
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
TEXAS (continued)
Kerrville Health Facilities Development Corporation, Texas,
Revenue Bonds, Sid Peterson Memorial Hospital Project, Series 2005:
$ 800 5.250%, 8/15/21 No Opt. Call BBB- $ 819,432
1,000 5.125%, 8/15/26 No Opt. Call BBB- 992,340
1,760 Laredo, Texas, Sports Venue Sales Tax Revenue Bonds, 3/09 at 100.00 AAA 1,893,496
Series 2001, 5.750%, 3/15/16 (Pre-refunded to 3/15/09) -
FGIC Insured
2,000 Pearland Independent School District, Brazoria County, Texas, 2/11 at 100.00 AAA 2,117,020
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 4,053,798
Texas, Limited Tax Schoolhouse and Refunding Bonds,
Series 2001, 5.125%, 2/01/26
3,900 Texas, General Obligation Bonds, Veterans Housing Assistance 12/11 at 101.00 Aa1 3,991,182
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 2,445,821
Texas, Unlimited Tax School Building and Refunding Bonds,
Series 2001, 0.000%, 2/15/25
------------------------------------------------------------------------------------------------------------------------------------
UTAH - 0.1% (0.1% OF TOTAL INVESTMENTS)
180 Utah Housing Finance Agency, Single Family Mortgage Bonds, 1/06 at 101.00 AAA 180,392
Series 1994B, 6.450%, 7/01/14
240 Utah Housing Finance Agency, Single Family Mortgage Bonds, 7/07 at 101.50 Aaa 240,840
Series 1997E-2, 5.875%, 1/01/19 (Alternative Minimum Tax)
390 Utah Housing Finance Agency, Single Family Mortgage Bonds, 1/09 at 101.50 Aaa 391,459
Series 1997C, 5.600%, 7/01/18 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
WASHINGTON - 9.4% (6.1% OF TOTAL INVESTMENTS)
15,000 Chelan County Public Utility District 1, Washington, Hydro 7/12 at 100.00 AAA 15,547,050
Consolidated System Revenue Bonds, Series 2002A,
5.450%, 7/01/37 (Alternative Minimum Tax) - AMBAC Insured
7,500 Energy Northwest, Washington, Electric Revenue Refunding 7/12 at 100.00 AAA 8,295,600
Bonds, Columbia Generating Station - Nuclear Project 2,
Series 2002C, 5.750%, 7/01/17 - MBIA Insured
5,000 Energy Northwest, Washington, Electric Revenue Refunding 7/13 at 100.00 Aaa 5,423,700
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 11,036,290
General Obligation Bonds, Series 2002, 5.500%, 12/01/16 -
FGIC Insured
6,965 Port of Seattle, Washington, Revenue Bonds, Series 1999A, 9/12 at 100.00 AAA 7,348,563
5.250%, 9/01/22 - FGIC Insured
2,820 Skagit County Public Hospital District 1, Washington, General 12/14 at 100.00 Aaa 3,055,780
Obligation Bonds, Series 2004A, 5.375%, 12/01/19 -
MBIA Insured
2,500 Snohomish County, Washington, Limited Tax General Obligation 12/11 at 100.00 AAA 2,632,525
Bonds, Series 2001, 5.125%, 12/01/22 - MBIA Insured
4,905 Washington, Various Purpose General Obligation Bonds, 1/09 at 100.00 Aa1 5,091,436
Series 1999B, 5.000%, 1/01/19
------------------------------------------------------------------------------------------------------------------------------------
WEST VIRGINIA - 2.5% (1.6% OF TOTAL INVESTMENTS)
7,000 Harrison County Commission, West Virginia, Solid Waste 11/05 at 100.00 AAA 7,108,570
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 5,091,850
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 1,045,260
Bonds, West Penn Power Company Pleasants Station Project,
Series 1999E, 5.500%, 4/01/29 (Alternative Minimum Tax) -
AMBAC Insured
2,355 West Virginia University, Unlimited Tax General Revenue Bonds, 10/14 at 100.00 AAA 2,457,322
Student Fees, Series 2004C, 5.000%, 10/01/24 - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
WISCONSIN - 1.4% (0.9% OF TOTAL INVESTMENTS)
3,215 Wisconsin Health and Educational Facilities Authority, Revenue 2/07 at 102.00 AAA 3,357,132
Bonds, Marshfield Clinic, Series 1997, 5.625%, 2/15/17 -
MBIA Insured
4,000 Wisconsin Health and Educational Facilities Authority, Revenue 2/09 at 101.00 BBB+ 4,085,240
Bonds, Aurora Health Care Inc., Series 1999A, 5.600%, 2/15/29
37
Nuveen Premium Income Municipal Fund 2, Inc. (NPM) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
WISCONSIN (continued)
$ 1,000 Wisconsin Health and Educational Facilities Authority, 5/14 at 100.00 BBB+ $ 1,053,900
Revenue Bonds, Fort Healthcare Inc., Series 2004,
5.750%, 5/01/24
------------------------------------------------------------------------------------------------------------------------------------
$ 1,028,416 Total Long-Term Investments (cost $912,683,227) - 154.3% 955,297,439
=============-----------------------------------------------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS - 0.4% (0.3% OF TOTAL INVESTMENTS)
1,600 Idaho Health Facilities Authority, Revenue Bonds, St. Luke's VMIG-1 1,600,000
Regional Medical Center, Variable Rate Demand Obligations,
Series 2000, 2.730%, 7/01/30 - FSA Insured+
1,000 Idaho Health Facilities Authority, Revenue Bonds, St. Luke's VMIG-1 1,000,000
Regional Medical Center, Variable Rate Demand Obligations,
Series 2005, 2.730%, 7/01/35 - FSA Insured+
------------------------------------------------------------------------------------------------------------------------------------
$ 2,600 Total Short-Term Investments (cost $2,600,000) 2,600,000
=============-----------------------------------------------------------------------------------------------------------------------
Total Investments (cost $915,283,227) - 154.7% 957,897,439
--------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 1.3% 8,384,301
--------------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (56.0)% (347,000,000)
--------------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 619,281,740
====================================================================================================================
(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. Certain
mortgage-backed securities may be subject to periodic
principal paydowns.
** 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 investment. The rate disclosed is that in
effect at the end of the reporting period. This rate
changes periodically based on market conditions or a
specified market index.
See accompanying notes to financial statements.
38
Nuveen Premium Income Municipal Fund 4, Inc. (NPT)
Portfolio of
INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
ALABAMA - 3.5% (2.2% OF TOTAL INVESTMENTS)
$ 2,395 Alabama Housing Finance Authority, FNMA Multifamily 2/11 at 102.00 AAA $ 2,499,039
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 12,034,409
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 Revenue 12/11 at 101.00 A- 5,504,217
Bonds, Series 2001, 5.750%, 12/01/16
------------------------------------------------------------------------------------------------------------------------------------
ALASKA - 0.9% (0.5% OF TOTAL INVESTMENTS)
3,065 Alaska Municipal Bond Bank Authority, General Obligation 12/13 at 100.00 AAA 3,250,126
Bonds, Series 2003E, 5.250%, 12/01/26 - MBIA Insured
1,665 Alaska Housing Finance Corporation, General Housing Purpose 12/14 at 100.00 AAA 1,703,378
Bonds, Series 2005A, 5.000%, 12/01/30 - FGIC 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 5,145,600
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 4,309,797
District, Arizona, Electric System Revenue Bonds,
Series 2003, 5.000%, 12/01/18 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
ARKANSAS - 0.0% (0.0% OF TOTAL INVESTMENTS)
75 Arkansas Development Finance Authority, FHA-Insured or VA 2/06 at 100.00 AA+ 75,200
Guaranteed Single Family Mortgage Revenue Refunding
Bonds, Series 1991A, 8.000%, 8/15/11
77 Jacksonville Residential Housing Facilities Board, Arkansas, 1/06 at 101.00 Aaa 78,010
FNMA Mortgage-Backed Securities Program Single Family
Mortgage Revenue Refunding Bonds, Series 1993A-2,
7.900%, 1/01/11
118 Lonoke County Residential Housing Facilities Board, Arkansas, 4/06 at 102.00 Aaa 119,947
FNMA Mortgage-Backed Securities Program Single Family
Mortgage Revenue Refunding Bonds, Series 1993A,
7.900%, 4/01/11
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA - 8.5% (5.4% OF TOTAL INVESTMENTS)
17,000 California Health Facilities Financing Authority, Health Facility 3/13 at 100.00 A 17,066,130
Revenue Bonds, Adventist Health System/West, Series 2003A,
5.000%, 3/01/33
2,000 California Infrastructure Economic Development Bank, Revenue 8/11 at 102.00 A+ 2,089,640
Bonds, Kaiser Hospital Assistance LLC, Series 2001A,
5.550%, 8/01/31
12,000 California, General Obligation Bonds, Series 2003, 5.250%, 2/01/22 8/13 at 100.00 A 12,703,200
4,500 California, General Obligation Bonds, Series 2004, 5.100%, 2/01/34 2/09 at 100.00 A 4,542,660
1,800 California Department of Water Resources, Power Supply Revenue 5/12 at 101.00 AAA 1,987,128
Bonds, Series 2002A, 5.500%, 5/01/14 - AMBAC Insured
4,780 Foothill/Eastern Transportation Corridor Agency, California, No Opt. Call AAA 3,409,574
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 1,140,750
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- 3,026,880
Power System Revenue Bonds, Series 2001A-3,
5.375%, 7/01/20
795 Santa Clara Valley Water District, California, Water Utility 6/10 at 100.00 AA 831,355
System Revenue Bonds, Series 2000A, 5.000%, 6/01/18
1,945 South Gate Public Financing Authority, California, Water No Opt. Call AAA 2,215,725
Revenue Refunding Bonds, Series 1996A, 6.000%, 10/01/12 -
FGIC Insured
39
Nuveen Premium Income Municipal Fund 4, Inc. (NPT) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
COLORADO - 6.2% (4.0% OF TOTAL INVESTMENTS)
$ 6,500 Adams 12 Five Star Schools, Adams County, Colorado, General 12/15 at 100.00 AAA $ 6,638,580
Obligation Bonds, Series 2005, 4.750%, 12/15/23 - FSA Insured
2,000 Colorado Health Facilities Authority, Revenue Refunding Bonds, 9/11 at 100.00 AA 2,076,600
Catholic Health Initiatives, Series 2001, 5.250%, 9/01/21
670 Colorado Housing Finance Authority, Single Family Program 10/09 at 105.00 Aa2 688,874
Senior Bonds, Series 1999C-3, 6.750%, 10/01/21
3,040 Denver City and County, Colorado, Airport System Revenue No Opt. Call A 3,507,886
Bonds, Series 1991D, 7.750%, 11/15/13 (Alternative
Minimum Tax)
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 3,051,691
10,000 5.000%, 12/01/33 - XLCA Insured 12/13 at 100.00 AAA 10,223,100
4,345 El Paso County School District 20, Academy, Colorado, General 12/12 at 100.00 Aaa 4,695,859
Obligation Bonds, Series 2002, 5.250%, 12/15/17 -
FGIC Insured
755 Jefferson County School District R1, Colorado, General 12/14 at 100.00 AAA 791,882
Obligation Bonds, Series 2004, 5.000%, 12/15/22 -
FSA Insured
4,125 Municipal Subdistrict Northern Colorado Water District, 12/07 at 101.00 AAA 4,317,019
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 3,083,220
Finance Program Bonds, Series 1996C-2, 6.250%, 11/15/18
------------------------------------------------------------------------------------------------------------------------------------
DISTRICT OF COLUMBIA - 5.5% (3.5% OF TOTAL INVESTMENTS)
6,000 District of Columbia, General Obligation Bonds, No Opt. Call AAA 6,487,020
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 4,412,393
Medlantic Healthcare Group, Series 1993A, 5.750%, 8/15/14 -
MBIA Insured
5 District of Columbia, General Obligation Bonds, Series 1993E, 12/05 at 100.00 AAA 5,013
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 1,617,397
7,215 6.000%, 6/01/07 - MBIA Insured No Opt. Call AAA 7,360,815
District of Columbia, Revenue Bonds, Georgetown University,
Series 2001A:
9,670 0.000%, 4/01/26 - MBIA Insured 4/11 at 42.15 AAA 3,116,544
15,235 0.000%, 4/01/30 - MBIA Insured 4/11 at 32.93 AAA 3,818,653
5,000 Washington Convention Center Authority, District of Columbia, 10/08 at 101.00 AAA 5,280,650
Senior Lien Dedicated Tax Revenue Bonds, Series 1998,
5.250%, 10/01/12 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
FLORIDA - 5.7% (3.6% OF TOTAL INVESTMENTS)
5,000 Broward County School Board, Florida, Certificates of 7/13 at 100.00 AAA 5,158,650
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 AAA 2,557,675
Education Capital Outlay Bonds, Series 1996A,
5.250%, 6/01/22 (Pre-refunded to 6/01/06)
5,000 Hillsborough County Aviation Authority, Florida, Revenue 10/13 at 100.00 AAA 5,279,600
Bonds, Tampa International Airport, Series 2003A,
5.250%, 10/01/18 (Alternative Minimum Tax) - MBIA Insured
5,000 Martin County Industrial Development Authority, Florida, 12/05 at 101.00 BB+ 5,038,200
Industrial Development Revenue Bonds, Indiantown
Cogeneration LP, 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 1,453,802
Multifamily Housing Revenue Bonds, Sunset Bay Apartments,
Series 2000-5A, 5.850%, 7/01/20 (Alternative Minimum Tax) -
FSA Insured
3,500 Miami-Dade County, Florida, Aviation Revenue Bonds, 10/15 at 100.00 AAA 3,510,430
Miami International Airport, Series 2005A, 5.000%, 10/01/37
(Alternative Minimum Tax) (WI, settling 11/02/05) -
XLCA Insured
9,500 Sunrise, Florida, Utility System Revenue Refunding Bonds, 10/18 at 100.00 AAA 9,975,380
Series 1998, 5.000%, 10/01/28 - AMBAC Insured
40
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
GEORGIA - 2.5% (1.6% OF TOTAL INVESTMENTS)
$ 4,400 Atlanta, Georgia, Water and Wastewater Revenue Bonds, No Opt. Call AAA $ 5,000,688
Series 1999A, 5.500%, 11/01/22 - FGIC Insured
2,880 Georgia Municipal Electric Authority, General Power Revenue No Opt. Call A+ 3,474,806
Bonds, Series 1992B, 8.250%, 1/01/11
5,500 Georgia Municipal Electric Authority, General Power Revenue No Opt. Call AAA 6,216,705
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 1,704,615
3,720 5.000%, 10/01/13 No Opt. Call Aa2 3,985,831
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS - 14.3% (9.1% OF TOTAL INVESTMENTS)
4,000 Chicago Board of Education, Illinois, General Obligation Lease No Opt. Call AAA 4,555,920
Certificates, Series 1992A, 6.250%, 1/01/15 - MBIA Insured
5,550 Chicago, Illinois, Revenue Bonds, Midway Airport, Series 2001A, 1/11 at 101.00 AAA 5,660,945
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 5,230,300
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 1,903,344
1,685 8.500%, 12/01/15 - FGIC Insured No Opt. Call Aaa 2,295,054
6,125 Illinois Development Finance Authority, GNMA Collateralized 4/11 at 105.00 Aaa 6,429,106
Mortgage Revenue Bonds, Greek American Nursing
Home Committee, Series 2000A, 7.600%, 4/20/40
1,385 Illinois Finance Authority, General Obligation Debt Certificates, 12/14 at 100.00 Aaa 1,463,086
Local Government Program - Kankakee County, Series 2005B,
5.000%, 12/01/18 - AMBAC Insured
Illinois Health Facilities Authority, Revenue Refunding Bonds,
Lutheran General Health System, Series 1993C:
4,420 7.000%, 4/01/08 No Opt. Call A+ 4,635,254
4,075 7.000%, 4/01/14 No Opt. Call A+ 4,854,425
4,000 Illinois Health Facilities Authority, Revenue Bonds, Condell 5/12 at 100.00 Baa2 4,089,040
Medical Center, Series 2002, 5.500%, 5/15/32
4,000 Illinois Health Facilities Authority, FHA-Insured Mortgage 8/13 at 100.00 AAA 4,088,480
Revenue Refunding Bonds, Sinai Health System, Series 2003,
5.150%, 2/15/37
1,480 Illinois Housing Development Authority, Multifamily Program 3/06 at 101.00 A+ 1,496,339
Bonds, Series 1994-5, 6.650%, 9/01/14
3,410 Illinois Housing Development Authority, Section 8 Elderly 11/05 at 100.00 A- 3,495,932
Housing Revenue Bonds, Skyline Towers Apartments,
Series 1992B, 6.875%, 11/01/17
9,795 Lake, Cook, Kane and McHenry Counties Community Unit School No Opt. Call AAA 10,775,480
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 5,698,100
4,540 5.000%, 12/15/28 - MBIA Insured 6/12 at 101.00 AAA 4,662,762
36,040 0.000%, 6/15/40 - MBIA Insured No Opt. Call AAA 6,345,923
3,050 Regional Transportation Authority, Cook, DuPage, Kane, Lake, No Opt. Call AAA 3,811,005
McHenry and Will Counties, Illinois, General Obligation Bonds,
Series 1990A, 7.200%, 11/01/20 - AMBAC Insured
1,362 Wood River Township, Madison County, Illinois, General 2/06 at 100.00 N/R 1,294,246
Obligation Bonds, Series 1993, 6.625%, 2/01/14
------------------------------------------------------------------------------------------------------------------------------------
INDIANA - 9.0% (5.7% OF TOTAL INVESTMENTS)
22,000 Indiana Health Facility Financing Authority, Hospital Revenue 8/10 at 101.50 AAA 23,490,940
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 3,536,400
Refunding Bonds, Columbus Regional Hospital, Series 1993,
7.000%, 8/15/15 - FSA Insured
2,800 Indiana Health Facility Financing Authority, Revenue Bonds, 5/15 at 100.00 AAA 2,868,096
Community Hospitals of Indiana, Series 2005A,
5.000%, 5/01/35 - AMBAC Insured
41
Nuveen Premium Income Municipal Fund 4, Inc. (NPT) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
INDIANA (continued)
$ 3,965 Indiana Educational Facilities Authority, Revenue Bonds, 2/11 at 100.00 AAA $ 4,245,801
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 1,626,675
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 4,158,400
6,000 5.000%, 6/01/24 - FSA Insured 6/13 at 100.00 AAA 6,221,940
5,000 Metropolitan School District Warren Township Vision 2005 1/11 at 100.00 AAA 5,452,450
School Building Corporation, Marion County, Indiana, First
Mortgage Bonds, Series 2000, 5.500%, 7/15/20 (Pre-refunded
to 1/15/11) - FGIC Insured
420 Marion County Convention and Recreational Facilities 6/07 at 102.00 AAA 426,098
Authority, Indiana, Excise Tax Lease Rental Revenue Bonds,
Series 1997A, 5.000%, 6/01/27 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
IOWA - 0.0% (0.0% OF TOTAL INVESTMENTS)
15 Davenport, Iowa, Home Ownership Mortgage Revenue 3/06 at 101.00 Aa2 15,074
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 2,146,620
Medical Center, Series 2000A, 5.500%, 9/01/25 -
AMBAC Insured
6,825 Sedgwick County Unified School District 259, Wichita, Kansas, 9/10 at 100.00 AA 6,369,909
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 1,848,823
Gas and Electric Company, Series 2004, 5.300%, 6/01/31 -
MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
LOUISIANA - 2.6% (1.7% OF TOTAL INVESTMENTS)
3,070 Jefferson Sales Tax District, Jefferson Parish, Louisiana, 12/12 at 100.00 AAA 3,224,360
Special Sales Tax Revenue Refunding Bonds, Series 2002,
5.250%, 12/01/20 - AMBAC Insured
1,750 Louisiana Local Government Environmental Facilities and 6/12 at 105.00 Aaa 1,916,425
Community Development Authority, GNMA Collateralized
Mortgage Revenue Refunding Bonds, Sharlo Apartments,
Series 2002A, 6.500%, 6/20/37
5,150 Louisiana Public Facilities Authority, Hospital Revenue Bonds, 8/15 at 100.00 A+ 5,242,288
Franciscan Missionaries of Our Lady Health System,
Series 2005A, 5.250%, 8/15/32
4,565 Orleans Levee District, Louisiana, Levee District General 12/05 at 103.00 AAA 4,707,565
Obligation Bonds, Series 1986, 5.950%, 11/01/14 -
FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
MAINE - 2.1% (1.4% OF TOTAL INVESTMENTS)
7,520 Maine Educational Loan Marketing Corporation, Student No Opt. Call A2 7,634,003
Loan Revenue Bonds, Subordinate Series 1994B-2,
6.250%, 11/01/06 (Alternative Minimum Tax)
4,160 Maine State Housing Authority, Single Family Mortgage 5/10 at 100.00 AA+ 4,314,294
Purchase Bonds, Series 2000C-1, 6.050%, 11/15/31
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
MARYLAND - 2.7% (1.7% OF TOTAL INVESTMENTS)
2,905 Maryland Community Development Administration, Housing 1/07 at 102.00 Aa2 2,989,506
Revenue Bonds, Series 1996A, 5.875%, 7/01/16
2,900 Maryland Community Development Administration, Housing 7/07 at 102.00 Aa2 2,989,059
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 7,051,396
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 2,428,389
Maryland, Multifamily Housing Development Bonds,
Series 2000B, 6.125%, 7/01/20 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
MASSACHUSETTS - 0.6% (0.4% OF TOTAL INVESTMENTS)
3,585 Massachusetts Development Finance Agency, Revenue Bonds, 3/15 at 100.00 A 3,563,992
Curry College, Series 2005A, 5.000%, 3/01/35 - ACA Insured
42
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
MICHIGAN - 6.5% (4.2% OF TOTAL INVESTMENTS)
$ 6,000 Detroit, Michigan, Second Lien Sewerage Disposal System 7/15 at 100.00 AAA $ 6,192,300
Revenue Bonds, Series 2005A, 5.000%, 7/01/35 -
MBIA Insured
Detroit, Michigan, Senior Lien Water Supply System Revenue
Bonds, Series 1997A:
1,535 5.000%, 7/01/27 (Pre-refunded to 7/01/07) - MBIA Insured 7/07 at 101.00 AAA 1,595,893
8,915 5.000%, 7/01/27 - MBIA Insured 7/07 at 101.00 AAA 9,168,008
Hancock Hospital Finance Authority, Michigan, FHA-Insured
Mortgage Hospital Revenue Bonds, Portage
Health System Inc., Series 1998:
1,050 4.625%, 8/01/18 - MBIA Insured 8/08 at 100.00 AAA 1,057,718
4,400 5.450%, 8/01/47 - MBIA Insured 8/08 at 100.00 AAA 4,592,280
5,000 Michigan State Building Authority, Revenue Refunding Bonds, 10/13 at 100.00 AAA 5,157,100
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 BB- 9,968,385
Bonds, Detroit Medical Center Obligated Group, Series 1998A,
5.250%, 8/15/23
------------------------------------------------------------------------------------------------------------------------------------
MINNESOTA - 0.8% (0.5% OF TOTAL INVESTMENTS)
1,160 Minneapolis-St. Paul Housing Finance Board, Minnesota, 11/07 at 102.00 AAA 1,189,510
FNMA/GNMA Mortgage-Backed Securities Program Single
Family Mortgage Revenue Bonds, Series 1997,
5.800%, 11/01/30 (Alternative Minimum Tax)
3,500 Minneapolis-St. Paul Metropolitan Airports Commission, 1/11 at 100.00 AAA 3,695,510
Minnesota, Airport Revenue Bonds, Series 2001A,
5.250%, 1/01/25 - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
MISSISSIPPI - 1.9% (1.3% OF TOTAL INVESTMENTS)
1,285 Jones County, Mississippi, Hospital Revenue Refunding Bonds, 12/07 at 100.00 BBB+ 1,289,883
South Central Regional Medical Center, Series 1997,
5.350%, 12/01/10
2,000 Mississippi Higher Education Assistance Corporation, 3/06 at 100.00 Aaa 2,002,800
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 1,877,531
Revenue Bonds, Baptist Memorial Healthcare,
Series 2004B-1, 5.000%, 9/01/24
5,180 Mississippi, General Obligation Refunding Bonds, No Opt. Call AA 5,843,972
Series 2002A, 5.500%, 12/01/18
------------------------------------------------------------------------------------------------------------------------------------
MISSOURI - 0.9% (0.6% OF TOTAL INVESTMENTS)
3,000 Missouri Health and Educational Facilities Authority, Revenue 5/13 at 100.00 AA 3,110,940
Bonds, BJC Health System, Series 2003, 5.125%, 5/15/24
2,000 St. Louis, Missouri, Airport Revenue Bonds, Airport 7/11 at 100.00 AAA 2,051,920
7/01/26 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
NEBRASKA - 1.6% (1.0% OF TOTAL INVESTMENTS)
9,000 NebHelp Inc., Nebraska, Senior Subordinate Bonds, Student No Opt. Call AAA 9,388,710
Loan Program, Series 1993A-5A, 6.250%, 6/01/18
(Alternative Minimum Tax) - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
NEVADA - 4.6% (2.9% OF TOTAL INVESTMENTS)
7,000 Clark County, Nevada, Motor Vehicle Fuel Tax Highway 7/13 at 100.00 AAA 7,288,890
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 11,492,322
Bonds, Series 2002C, 5.500%, 6/15/18 (Pre-refunded to
6/15/12) - MBIA Insured
4,500 Clark County School District, Nevada, General Obligation No Opt. Call AAA 5,136,480
School Improvement Bonds, Series 1991A, 7.000%, 6/01/10 -
MBIA Insured
5,425 Director of Nevada State Department of Business and Industry, No Opt. Call AAA 2,080,270
Revenue Bonds, Las Vegas Monorail Project, First Tier,
Series 2000, 0.000%, 1/01/25 - AMBAC Insured
405 Nevada Housing Division, Single Family Mortgage Bonds, 4/06 at 100.00 A1 407,637
Senior Series 1992B-1, 6.200%, 10/01/15
------------------------------------------------------------------------------------------------------------------------------------
NEW JERSEY - 4.1% (2.6% OF TOTAL INVESTMENTS)
1,100 New Jersey Health Care Facilities Financing Authority, 7/10 at 101.00 BBB- 1,224,014
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 2,748,152
300 6.500%, 1/01/16 - MBIA Insured No Opt. Call AAA 352,275
880 6.500%, 1/01/16 - MBIA Insured No Opt. Call AAA 1,028,922
43
Nuveen Premium Income Municipal Fund 4, Inc. (NPT) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
NEW JERSEY (continued)
$ 13,890 Tobacco Settlement Financing Corporation, New Jersey, 6/12 at 100.00 BBB $ 14,440,044
Tobacco Settlement Asset-Backed Bonds, Series 2002,
5.750%, 6/01/32
3,385 Tobacco Settlement Financing Corporation, New Jersey, 6/13 at 100.00 BBB 3,861,439
Tobacco Settlement Asset-Backed Bonds, Series 2003,
6.750%, 6/01/39
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK - 9.2% (5.9% OF TOTAL INVESTMENTS)
1,200 Hempstead Industrial Development Agency, New York, No Opt. Call BB+ 1,247,724
Resource Recovery Revenue Refunding Bonds, American
Ref-Fuel Company of Hempstead LP, Series 2001,
5.000%, 12/01/10 (Mandatory put 6/01/10) 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 AAA 1,422,144
35 5.000%, 5/01/26 (Pre-refunded to 5/01/08) 5/08 at 101.00 AAA 36,870
15,530 5.000%, 5/01/26 5/08 at 101.00 AAA 15,859,081
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 5/01/10) 5/10 at 101.00 AAA 4,033,620
1,155 5.500%, 11/01/24 (Pre-refunded to 5/01/10) 5/10 at 101.00 AAA 1,265,753
3,845 5.500%, 11/01/24 (Pre-refunded to 5/01/10) 5/10 at 101.00 AAA 4,162,097
220 New York City Transitional Finance Authority, New York, 5/10 at 101.00 AAA 244,268
Future Tax Secured Bonds, Fiscal Series 2000A,
5.875%, 11/01/16 (Pre-refunded to 5/01/10)
1,590 New York State Medical Care Facilities Finance Agency, 2/06 at 100.00 AAA 1,598,697
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, 2/06 at 101.00 AA 4,292,232
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, 2/06 at 100.00 AA 3,489,236
FHA-Insured Hospital and Nursing Home Mortgage Revenue
Bonds, Series 1994A, 6.200%, 2/15/21
6,250 Port Authority of New York and New Jersey, Special Project No Opt. Call AAA 7,055,438
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- 5,767,416
2,500 5.500%, 6/01/18 6/12 at 100.00 AA-
------------------------------------------------------------------------------------------------------------------------------------
NORTH CAROLINA - 3.2% (2.0% OF TOTAL INVESTMENTS)
2,675 Charlotte, North Carolina, Water and Sewerage System 6/11 at 101.00 AAA 2,949,830
Revenue Bonds, Series 2001, 5.500%, 6/01/13
2,000 North Carolina Municipal Power Agency 1, Catawba Electric No Opt. Call AAA 2,217,880
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 10,681,700
Revenue Bonds, Series 2003A, 5.250%, 1/01/18 - MBIA Insured
2,445 North Carolina Infrastructure Finance Corporation, 2/14 at 100.00 AA+ 2,535,123
Certificates of Participation, Correctional Facilities,
Series 2004A, 5.000%, 2/01/21
------------------------------------------------------------------------------------------------------------------------------------
OHIO - 2.3% (1.5% OF TOTAL INVESTMENTS)
9,000 Cleveland, Ohio, Airport System Revenue Bonds, 1/10 at 101.00 AAA 9,161,280
Series 2000A, 5.000%, 1/01/31 - FSA Insured
3,000 Franklin County, Ohio, Development Revenue Bonds, American 10/09 at 101.00 A 3,190,920
Chemical Society, Series 1999, 5.800%, 10/01/14
1,000 Franklin County, Ohio, FHA-Insured Multifamily Housing 1/06 at 102.00 Aa 1,012,330
Mortgage Revenue Bonds, Hamilton Creek Project,
Series 1994A, 5.550%, 7/01/24 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
OKLAHOMA - 0.7% (0.4% OF TOTAL INVESTMENTS)
345 Oklahoma Housing Finance Agency, Single Family Mortgage 3/10 at 101.00 Aaa 362,374
Revenue Bonds, Homeownership Loan Program,
Series 2000C-2, 6.200%, 9/01/28 (Alternative Minimum Tax)
3,340 Tulsa Industrial Authority, Oklahoma, Hospital Revenue No Opt. Call AAA 3,681,081
Refunding Bonds, Hillcrest Medical Center, Series 1996,
6.500%, 6/01/09 - CONNIE LEE/AMBAC Insured
44
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
PENNSYLVANIA - 1.6% (1.0% OF TOTAL INVESTMENTS)
$ 1,530 Beaver Area School District, Beaver County, Pennsylvania, 7/06 at 100.00 AAA $ 1,551,619
General Obligation Bonds, Series 2001, 5.000%, 1/15/20
(Pre-refunded to 7/15/06) - FGIC Insured
5,000 Pennsylvania Economic Development Financing Authority, 1/06 at 100.00 BBB- 5,015,050
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 Bonds, 12/14 at 100.00 AAA 2,837,562
Series 2004A, 5.500%, 12/01/31 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
PUERTO RICO - 3.2% (2.0% OF TOTAL INVESTMENTS)
12,390 Puerto Rico, General Obligation and Public Improvement No Opt. Call AAA 14,609,669
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 3,792,467
Series 2000O, 5.750%, 6/01/18 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
RHODE ISLAND - 3.7% (2.3% OF TOTAL INVESTMENTS)
20,000 Rhode Island Tobacco Settlement Financing Corporation, 6/12 at 100.00 BBB 21,174,200
Tobacco Settlement Asset-Backed Bonds, Series 2002A,
6.250%, 6/01/42
------------------------------------------------------------------------------------------------------------------------------------
SOUTH CAROLINA - 4.2% (2.7% OF TOTAL INVESTMENTS)
4,120 Medical University Hospital Authority, South Carolina, 8/14 at 100.00 AAA 4,363,451
FHA-Insured Mortgage Revenue Bonds, Series 2004A,
5.250%, 2/15/23 - MBIA Insured
3,000 Myrtle Beach, South Carolina, Hospitality and Accommodation 6/14 at 100.00 AAA 3,075,840
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 5,993,850
5,750 4.000%, 1/01/23 - MBIA Insured 1/06 at 100.00 AAA 5,275,913
5,085 Piedmont Municipal Power Agency, South Carolina, Electric No Opt. Call AAA 5,584,144
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+ 1,843,257
Revenue Bonds, Sioux Valley Hospitals, Series 2004A,
5.500%, 11/01/31
------------------------------------------------------------------------------------------------------------------------------------
TENNESSEE - 0.3% (0.2% OF TOTAL INVESTMENTS)
1,500 Metropolitan Government of Nashville-Davidson County, 5/08 at 102.00 AA 1,579,260
Tennessee, Electric System Revenue Bonds, Series 1998A,
5.200%, 5/15/23
------------------------------------------------------------------------------------------------------------------------------------
TEXAS - 18.2% (11.6% OF TOTAL INVESTMENTS)
4,500 Alliance Airport Authority, Texas, Special Facilities Revenue 12/05 at 100.00 CCC 3,398,895
Bonds, American Airlines Inc., Series 1990, 7.500%, 12/01/29
(Alternative Minimum Tax)
4,000 Central Texas Regional Mobility Authority, Travis and Williamson 1/15 at 100.00 AAA 4,095,760
Counties, Toll Road Revenue Bonds, Series 2005,
5.000%, 1/01/35 - FGIC Insured
3,345 Columbia-Brazoria Independent School District, Texas, 2/09 at 100.00 AAA 3,357,243
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 8,706,400
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 2,271,937
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 6,154,440
Housing Revenue Bonds, Legacy Pointe Apartments,
Series 2000, 7.500%, 6/01/40 (Alternative Minimum Tax)
(Optional put 6/01/14)
3,750 Harris County Flood Control District, Texas, General Obligation 10/13 at 100.00 AA+ 3,892,538
Bonds, Series 2003, 5.000%,10/01/23
7,000 Harris County Health Facilities Development Corporation, 11/13 at 100.00 AAA 7,134,400
Texas, Thermal Utility Revenue Bonds, TECO Project,
Series 2003, 5.000%, 11/15/30 - MBIA Insured
28,305 Houston, Texas, Hotel Occupancy Tax and Special Revenue No Opt. Call AAA 8,991,366
Bonds, Convention and Entertainment Project, Series 2001B,
0.000%, 9/01/28 - AMBAC Insured
45
Nuveen Premium Income Municipal Fund 4, Inc. (NPT) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
TEXAS (continued)
$ 7,500 Houston, Texas, Junior Lien Water and Sewerage System No Opt. Call AAA $ 8,837,925
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 5,279,950
Revenue Refunding Bonds, Series 1997D, 5.000%, 12/01/25
(Pre-refunded to 12/01/07) - FGIC Insured
7,015 Liberty County Housing Development Corporation, Texas, No Opt. Call N/R 5,767,242
Multifamily Housing Revenue Bonds, Series 1999,
7.250%, 6/01/34 (Optional put 6/01/09)
208 Midland Housing Finance Corporation, Texas, Single Family 11/05 at 103.00 Aaa 214,510
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 2,471,925
2,400 5.500%, 2/15/23 2/11 at 100.00 AAA 2,579,400
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 3,100,353
3,000 5.125%, 2/15/31 8/11 at 100.00 Aaa 3,079,050
6,000 Raven Hills Higher Education Corporation, Texas, Student 8/12 at 100.00 Aaa 6,190,200
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 4,141,820
Revenue Bonds, Retama Park Racetrack, Series 1993,
8.750%, 12/15/18 (Pre-refunded to 12/15/12) (a)
1,800 Sam Rayburn Municipal Power Agency, Texas, Power Supply 10/12 at 100.00 AA 1,955,772
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 4,841,893
Texas, Limited Tax Schoolhouse and Refunding Bonds,
Series 2001, 5.125%, 2/01/26
8,500 Travis County Health Facilities Development Corporation, 11/05 at 100.00 Aaa 8,722,445
Texas, Hospital Revenue Bonds, Daughters of Charity National
Health System, Series 1993B, 6.000%, 11/15/22
------------------------------------------------------------------------------------------------------------------------------------
UTAH - 6.3% (4.0% OF TOTAL INVESTMENTS)
4,845 Bountiful, Davis County, Utah, Hospital Revenue Refunding 12/08 at 101.00 N/R 4,523,001
Bonds, South Davis Community Hospital Project, Series 1998,
5.750%, 12/15/18
Intermountain Power Agency, Utah, Power Supply Revenue
Bonds, Series 1996A:
5,065 6.150%, 7/01/14 7/06 at 102.00 A+*** 5,282,694
2,935 6.150%, 7/01/14 7/06 at 102.00 A+ 3,038,341
Intermountain Power Agency, Utah, Power Supply Revenue
Refunding Bonds, Series 1997B:
5,820 5.750%, 7/01/19 (Pre-refunded to 7/01/07) - MBIA Insured 7/07 at 102.00 AAA 6,179,443
11,750 5.750%, 7/01/19 - MBIA Insured 7/07 at 102.00 AAA 12,409,410
1,435 Salt Lake City and Sandy Metropolitan Water District, Utah, 7/14 at 100.00 Aaa 1,507,482
Water Revenue Bonds, Series 2004, 5.000%, 7/01/21 -
AMBAC Insured
590 Utah Housing Finance Agency, Single Family Mortgage 7/10 at 100.00 AA 592,159
Bonds, Series 2000G, 5.875%, 7/01/27 (Alternative
Minimum Tax)
Utah Housing Finance Agency, Single Family Mortgage Bonds,
Series 2001C:
1,985 5.500%, 1/01/18 (Alternative Minimum Tax) 1/11 at 100.00 AA- 2,037,464
600 5.650%, 1/01/21 (Alternative Minimum Tax) 1/11 at 100.00 Aa2 616,338
------------------------------------------------------------------------------------------------------------------------------------
VIRGINIA - 1.8% (1.1% OF TOTAL INVESTMENTS)
8,190 Hampton, Virginia, Revenue Bonds, Convention Center Project, 1/13 at 100.00 AAA 8,380,827
Series 2002, 5.000%, 1/15/35 - AMBAC Insured
1,775 Virginia Transportation Board, Transportation Revenue Refunding 5/07 at 101.00 AA+ 1,836,646
Bonds, U.S. Route 58 Corridor Development Program,
Series 1997C, 5.125%, 5/15/19
------------------------------------------------------------------------------------------------------------------------------------
WASHINGTON - 10.3% (6.6% OF TOTAL INVESTMENTS)
1,855 Chelan County Public Utility District 1, Washington, Hydro 7/09 at 101.00 AA 2,000,580
Consolidated System Revenue Bonds, Series 1999A,
6.200%, 7/01/34 (Alternative Minimum Tax)
1,655 Everett, Washington, Limited Tax General Obligation Bonds, 9/07 at 100.00 Aaa 1,703,607
Series 1997, 5.125%, 9/01/17 - FSA Insured
6,000 Grant County Public Utility District 2, Washington, Revenue 1/15 at 100.00 AAA 6,148,140
Bonds, Wanapum Hydroelectric Development, Series 2005A,
5.000%, 1/01/34 - FGIC Insured
46
Nuveen Premium Income Municipal Fund 4, Inc. (NPT) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
WASHINGTON (continued)
$ 1,612 Skagit County Housing Authority, Washington, GNMA 11/05 at 103.00 AAA $ 1,663,100
Collateralized Mortgage Loan Nursing Facility Revenue
Bonds, Sea Mar Community Health Centers, Series 1993,
7.000%, 6/20/35
1,500 Snohomish County School District 6, Mukilteo, Washington, No Opt. Call AAA 1,672,530
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 9,048,380
Bonds, Series 2001A, 5.750%, 1/01/20 (Pre-refunded to
1/01/11) - FSA Insured
4,705 Tacoma, Washington, Sewerage Revenue Refunding Bonds, No Opt. Call AAA 5,325,590
Series 1994B, 8.000%, 12/01/08 - FGIC Insured
4,740 Washington State Tobacco Settlement Authority, Tobacco 6/13 at 100.00 BBB 5,138,824
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 2,023,620
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 1,025,150
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 6,249,146
395 7.250%, 7/01/06 No Opt. Call Aaa 405,637
11,000 Washington Public Power Supply System, Revenue Refunding No Opt. Call Aaa 12,283,260
Bonds, Nuclear Project 3, Series 1993B, 7.000%, 7/01/09
4,700 Washington Public Power Supply System, Revenue Refunding 7/08 at 102.00 Aaa 4,914,601
Bonds, Nuclear Project 3, Series 1998A, 5.125%, 7/01/18
------------------------------------------------------------------------------------------------------------------------------------
WISCONSIN - 1.4% (0.9% OF TOTAL INVESTMENTS)
500 Wisconsin Health and Educational Facilities Authority, Revenue 12/06 at 102.00 AAA 519,960
Bonds, Medical College of Wisconsin Inc., Series 1996,
5.500%, 12/01/26 - MBIA Insured
7,500 Wisconsin Health and Educational Facilities Authority, Revenue 2/12 at 101.00 AAA 7,793,325
Bonds, Ministry Healthcare Inc., Series 2002A,
5.250%, 2/15/32 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
$ 935,237 Total Long-Term Investments (cost $862,936,276) - 156.1% 902,930,387
=============-----------------------------------------------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS - 0.7% (0.4% OF TOTAL INVESTMENTS)
4,000 New Jersey Economic Development Authority, Dock Facility VMIG-1 4,000,000
Revenue Refunding Bonds, Bayonne/IMTT Project, Variable
Rate Demand Obligations, Series 1993C, 2.690%, 12/01/27+
------------------------------------------------------------------------------------------------------------------------------------
$ 4,000 Total Short-Term Investments (cost $4,000,000) 4,000,000
=============-----------------------------------------------------------------------------------------------------------------------
Total Investments (cost $866,936,276) - 156.8% 906,930,387
--------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 1.7% 9,986,673
--------------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (58.5)% (338,400,000)
--------------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 578,517,060
====================================================================================================================
(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. Certain
mortgage-backed securities may be subject to periodic
principal paydowns.
** 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 investment. The rate disclosed is that in
effect at the end of the reporting period. This rate
changes periodically based on market conditions or a
specified market index.
(a) The issuer has received a proposed adverse
determination from the Internal Revenue Service (the
"IRS") regarding the tax-exempt status of the bonds'
coupon payments. The Fund will continue to treat coupon
payments as tax-exempt income until such time that it
is formally determined that the interest on the bonds
should be treated as taxable.
See accompanying notes to financial statements.
47
Statement of
ASSETS AND LIABILITIES October 31, 2005
PREMIUM PREMIUM PREMIUM
INCOME INCOME 2 INCOME 4
(NPI) (NPM) (NPT)
------------------------------------------------------------------------------------------------------------------------------------
ASSETS
Investments, at market value (cost $1,415,869,511,
$915,283,227 and $866,936,276, respectively) $1,464,308,534 $957,897,439 $906,930,387
Cash -- 114,413 --
Receivables:
Interest 22,663,781 13,982,484 15,678,855
Investments sold 1,802,367 3,105,840 819,914
Other assets 94,611 60,778 91,626
------------------------------------------------------------------------------------------------------------------------------------
Total assets 1,488,869,293 975,160,954 923,520,782
------------------------------------------------------------------------------------------------------------------------------------
LIABILITIES
Cash overdraft 3,272,959 -- 2,287,109
Payable for investments purchased 11,855,002 8,060,774 3,510,675
Accrued expenses:
Management fees 762,145 506,663 481,293
Other 378,771 219,928 226,031
Preferred share dividends payable 154,812 91,849 98,614
------------------------------------------------------------------------------------------------------------------------------------
Total liabilities 16,423,689 8,879,214 6,603,722
------------------------------------------------------------------------------------------------------------------------------------
Preferred shares, at liquidation value 525,000,000 347,000,000 338,400,000
------------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common shares $ 947,445,604 $619,281,740 $578,517,060
====================================================================================================================================
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) $ 14.85 $ 15.07 $ 13.38
====================================================================================================================================
NET ASSETS APPLICABLE TO COMMON SHARES CONSIST OF:
------------------------------------------------------------------------------------------------------------------------------------
Common shares, $.01 par value per share $ 637,854 $ 410,937 $ 432,367
Paid-in surplus 901,333,523 570,811,669 587,221,260
Undistributed net investment income 3,994,053 2,445,548 2,054,325
Accumulated net realized gain (loss) from investments (6,958,849) 2,999,374 (51,185,003)
Net unrealized appreciation of investments 48,439,023 42,614,212 39,994,111
------------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common shares $ 947,445,604 $619,281,740 $578,517,060
====================================================================================================================================
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.
48
Statement of
OPERATIONS Year Ended October 31, 2005
PREMIUM PREMIUM PREMIUM
INCOME INCOME 2 INCOME 4
(NPI) (NPM) (NPT)
------------------------------------------------------------------------------------------------------------------------------------
INVESTMENT INCOME $ 73,940,435 $ 48,078,308 $46,396,983
------------------------------------------------------------------------------------------------------------------------------------
EXPENSES
Management fees 9,070,871 6,028,344 5,705,872
Preferred shares - auction fees 1,312,500 867,500 846,000
Preferred shares - dividend disbursing agent fees 60,000 60,000 80,000
Shareholders' servicing agent fees and expenses 175,192 63,631 88,852
Custodian's fees and expenses 338,457 225,400 201,304
Directors' fees and expenses 25,897 22,038 16,381
Professional fees 126,506 45,024 164,072
Shareholders' reports - printing and mailing expenses 120,334 68,177 76,822
Stock exchange listing fees 24,841 16,004 16,839
Investor relations expense 199,729 129,420 126,572
Other expenses 68,160 48,566 72,893
------------------------------------------------------------------------------------------------------------------------------------
Total expenses before custodian fee credit and legal fee refund 11,522,487 7,574,104 7,395,607
Custodian fee credit (18,498) (7,943) (60,168)
Legal fee refund (112,424) -- (143,090)
------------------------------------------------------------------------------------------------------------------------------------
Net expenses 11,391,565 7,566,161 7,192,349
------------------------------------------------------------------------------------------------------------------------------------
Net investment income 62,548,870 40,512,147 39,204,634
------------------------------------------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) from investments 15,187,341 2,929,207 (6,218,283)
Change in net unrealized appreciation (depreciation) of investments (31,573,368) (13,011,728) 2,030,792
------------------------------------------------------------------------------------------------------------------------------------
Net realized and unrealized gain (loss) (16,386,027) (10,082,521) (4,187,491)
------------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO PREFERRED SHAREHOLDERS
From net investment income (10,275,032) (6,593,605) (6,741,182)
From accumulated net realized gains from investments -- (333,998) --
------------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets applicable to Common shares
from distributions to Preferred shareholders (10,275,032) (6,927,603) (6,741,182)
------------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets applicable to Common shares from operations $ 35,887,811 $ 23,502,023 $28,275,961
====================================================================================================================================
See accompanying notes to financial statements.
49
Statement of
CHANGES IN NET ASSETS
PREMIUM INCOME (NPI) PREMIUM INCOME 2 (NPM) PREMIUM INCOME 4 (NPT)
----------------------------- ------------------------------ -----------------------------
YEAR YEAR YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
10/31/05 10/31/04 10/31/05 10/31/04 10/31/05 10/31/04
------------------------------------------------------------------------------------------------------------------------------------
OPERATIONS
Net investment income $ 62,548,870 $ 64,664,939 $ 40,512,147 $ 42,290,011 $ 39,204,634 $ 40,793,820
Net realized gain (loss) from
investments 15,187,341 2,482,620 2,929,207 4,358,413 (6,218,283) 652,547
Change in net unrealized
appreciation (depreciation)
of investments (31,573,368) 20,569,667 (13,011,728) 15,104,071 2,030,792 15,883,141
Distributions to Preferred
Shareholders:
From net investment income (10,275,032) (4,988,711) (6,593,605) (3,250,596) (6,741,182) (3,283,827)
From accumulated net
realized gains
from investments -- -- (333,998) -- -- --
------------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets
applicable to Common shares
from operations 35,887,811 82,728,515 23,502,023 58,501,899 28,275,961 54,045,681
------------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO COMMON SHAREHOLDERS
From net investment income (57,980,964) (61,501,952) (38,210,760) (40,436,175) (35,043,351) (37,551,098)
From accumulated net realized
gains from investments -- -- (3,990,843) -- -- --
------------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets applicable to
Common shares from distributions
to Common shareholders (57,980,964) (61,501,952) (42,201,603) (40,436,175) (35,043,351) (37,551,098)
------------------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS
Preferred shares offering costs -- -- -- -- -- 14,080
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in
net assets applicable
to Common shares (22,093,153) 21,226,563 (18,699,580) 18,065,724 (6,767,390) 16,508,663
Net assets applicable to
Common shares at the
beginning of year 969,538,757 948,312,194 637,981,320 619,915,596 585,284,450 568,775,787
------------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common
shares at the end of year $947,445,604 $969,538,757 $619,281,740 $637,981,320 $578,517,060 $585,284,450
====================================================================================================================================
Undistributed net investment
income at the end of year $ 3,994,053 $ 9,737,131 $ 2,445,548 $ 6,806,263 $ 2,054,325 $ 4,797,353
====================================================================================================================================
See accompanying notes to financial statements.
50
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 or certain U.S. territories.
Effective January 1, 2005, Nuveen Advisory Corp. ("NAC"), the Funds' previous
Adviser, and its affiliate, Nuveen Institutional Advisory Corp. ("NIAC"), were
merged into Nuveen Asset Management ("NAM"), each wholly owned subsidiaries of
Nuveen Investments, Inc. ("Nuveen"). As a result of the merger, NAM is now the
Adviser to all funds previously advised by either NAC or NIAC.
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.
Investment 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 market
price quotes are not readily available (which is usually the case for municipal
securities), the pricing service or, in the absence of a pricing service for a
particular security, the Board of Directors of the Funds, or its designee, may
establish fair market value using a wide variety of market data including yields
or prices of municipal bonds of comparable quality, type of issue, coupon,
maturity and rating, market quotes or indications of value from securities
dealers, evaluations of anticipated cash flows or collateral, general market
conditions and other information and analysis, including the obligor's credit
characteristics considered relevant by the pricing service or the Board of
Directors' designee. Temporary investments in securities that have variable rate
and demand features qualifying them as short-term investments are valued at
amortized cost, which approximates market value.
Investment Transactions
Investment transactions are recorded on a trade date basis. Realized gains and
losses from transactions are determined on the specific identification method.
Investments purchased on a when-issued or delayed delivery basis may have
extended settlement periods. Any investments 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, 2005,
Premium Income (NPI), Premium Income 2 (NPM) and Premium Income 4 (NPT) had
outstanding when-issued purchase commitments of $8,190,389, $1,065,500 and
$3,510,675, respectively.
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. Legal fee refunds presented on the
Statement of Operations for Premium Income (NPI) and Premium Income 4 (NPT)
reflect a refund of workout expenditures paid in a prior reporting period.
Federal Income Taxes
Each Fund is a separate taxpayer for federal income tax purposes. Each Fund
intends to distribute substantially 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, 2005, have been designated Exempt Interest Dividends. Net realized capital
gains and ordinary income distributions paid by the Funds are subject to federal
taxation.
51
Notes to
FINANCIAL STATEMENTS (continued)
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.
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 paid by the Funds on each
Series is determined every seven days, pursuant to a dutch auction process
overseen by the auction agent, and is payable 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, 2005.
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, their 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.
52
2. FUND SHARES
None of the Funds engaged in transactions in their own shares during the fiscal
year ended October 31, 2005 nor during the fiscal year ended October 31, 2004.
3. SECURITIES TRANSACTIONS
Purchases and sales (including maturities) of investments in long-term municipal
securities during the fiscal year ended October 31, 2005, were as follows:
PREMIUM PREMIUM PREMIUM
INCOME INCOME 2 INCOME 4
(NPI) (NPM) (NPT)
--------------------------------------------------------------------------------
Purchases $304,934,548 $153,910,380 $79,396,195
Sales and maturities 299,184,466 149,151,044 66,964,347
================================================================================
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, timing differences
in recognizing taxable market discount and timing differences in recognizing
certain gains and losses on investment transactions.
At October 31, 2005, the cost of investments was as follows:
PREMIUM PREMIUM PREMIUM
INCOME INCOME 2 INCOME 4
(NPI) (NPM) (NPT)
--------------------------------------------------------------------------------
Cost of investments $1,414,817,110 $914,943,087 $866,399,017
================================================================================
Gross unrealized appreciation and gross unrealized depreciation of investments
at October 31, 2005, were as follows:
PREMIUM PREMIUM PREMIUM
INCOME INCOME 2 INCOME 4
(NPI) (NPM) (NPT)
-------------------------------------------------------------------------------------------------------------
Gross unrealized:
Appreciation $ 64,111,367 $44,589,985 $44,619,131
Depreciation (14,619,943) (1,635,633) (4,087,761)
-------------------------------------------------------------------------------------------------------------
Net unrealized appreciation of investments $49,491,424 $42,954,352 $40,531,370
=============================================================================================================
The tax components of undistributed net investment income and net realized gains
at October 31, 2005, were as follows:
PREMIUM PREMIUM PREMIUM
INCOME INCOME 2 INCOME 4
(NPI) (NPM) (NPT)
-------------------------------------------------------------------------------------------------------------
Undistributed net tax-exempt income * $7,430,722 $5,088,588 $4,400,045
Undistributed net ordinary income ** 98,830 26,320 4,412
Undistributed net long-term capital gains -- 2,999,374 --
=============================================================================================================
* Undistributed net tax-exempt income (on a tax basis) has not been reduced
for the dividend declared on October 3, 2005, paid on November 1, 2005.
** 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, 2005 and October 31, 2004, was
designated for purposes of the dividends paid deduction as follows:
PREMIUM PREMIUM PREMIUM
INCOME INCOME 2 INCOME 4
2005 (NPI) (NPM) (NPT)
-------------------------------------------------------------------------------------------------------------
Distributions from net tax-exempt income $68,878,627 $45,079,031 $42,030,160
Distributions from net ordinary income ** -- 126,711 --
Distributions from net long-term capital gains -- 4,324,841 --
=============================================================================================================
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 -- -- --
=============================================================================================================
** Net ordinary income consists of taxable market discount income and net
short-term capital gains, if any.
53
Notes to
FINANCIAL STATEMENTS (continued)
At October 31, 2005, 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 $ -- $ 2,151,015
2009 -- --
2010 695,347 18,079,555
2011 6,263,502 24,792,603
2012 -- --
2013 -- 6,161,830
--------------------------------------------------------------------------------
Total $6,958,849 $51,185,003
================================================================================
5. MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES
Each Fund's management fee is separated into two components - a complex-level
component, based on the aggregate amount of all fund assets managed by the
Adviser, 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.
The annual fund-level fee, payable monthly, for each Fund 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
================================================================================
54
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 stated in the table below. As
of October 31, 2005, the complex-level fee rate was .1905%.
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
================================================================================
(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.
The management fee compensates the Adviser for overall investment advisory and
administrative services and general office facilities. The Funds pay no
compensation directly to their 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. ANNOUNCEMENT REGARDING PARENT COMPANY OF ADVISER
In early April, 2005, The St. Paul Travelers Companies, Inc. ("St. Paul
Travelers"), which owned 79% of Nuveen, (A) completed a public offering of a
substantial portion of its equity stake in Nuveen, (B) sold Nuveen $200 million
of its Nuveen shares, (C) entered into an agreement with Nuveen to sell an
additional $400 million of its Nuveen shares on a "forward" basis with payment
for and settlement of these shares delayed for several months, and (D) entered
into agreements with two unaffiliated investment banking firms to sell an amount
equal to most or all of its remaining Nuveen shares for current payment but for
future settlement. Transactions (C) and (D) above were settled in late July,
which effectively reduced St. Paul Travelers' controlling stake in Nuveen and
was deemed an "assignment" (as defined in the 1940 Act) of the investment
management agreements between the Funds and the Adviser, which resulted in the
automatic termination of each agreement under the 1940 Act. In anticipation of
such deemed assignment, the Board of Directors had approved new ongoing
investment management agreements for each Fund and the submission of those
agreements for approval by each respective Fund's shareholders, which
shareholder approval was received prior to the settlement of transactions (C)
and (D). The new ongoing management agreements took effect upon such settlement.
7. 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, 2005, to shareholders of record
on November 15, 2005, as follows:
PREMIUM PREMIUM PREMIUM
INCOME INCOME 2 INCOME 4
(NPI) (NPM) (NPT)
--------------------------------------------------------------------------------
Dividend per share $.0695 $.0710 $.0645
================================================================================
55
Financial
HIGHLIGHTS
Selected data for a Common share outstanding throughout each period:
Investment Operations Less Distributions
----------------------------------------------------------------- ---------------------------------
Distributions Distributions
from Net from Net
Beginning Investment Capital Investment Capital
Common Net Income to Gains to Income to Gains to
Share Net Realized/ Preferred Preferred Common Common
Net Asset Investment Unrealized Share- Share- Share- Share-
Value Income Gain (Loss) holders+ holders+ Total holders holders Total
------------------------------------------------------------------------------------------------------------------------------------
PREMIUM INCOME (NPI)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2005 $15.20 $ .98 $(.26) $(.16) $ -- $ .56 $(.91) $ -- $ (.91)
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)
PREMIUM INCOME 2 (NPM)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2005 15.53 .98 (.24) (.16) (.01) .57 (.93) (.10) (1.03)
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)
PREMIUM INCOME 4 (NPT)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2005 13.54 .91 (.10) (.16) -- .65 (.81) -- (.81)
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)
====================================================================================================================================
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:
2005 $14.85 $13.87 3.37% 3.71%
2004 15.20 14.30 8.82 9.00
2003 14.87 14.06 6.48 6.58
2002 14.87 14.11 5.51 3.47
2001 15.27 14.25 26.60 13.22
PREMIUM INCOME 2 (NPM)
-------------------------------------------------------------------------------
Year Ended 10/31:
2005 15.07 13.97 2.98 3.71
2004 15.53 14.57 9.48 9.77
2003 15.09 14.25 6.57 6.07
2002 15.27 14.40 5.59 5.03
2001 15.53 14.61 17.31 11.63
PREMIUM INCOME 4 (NPT)
-------------------------------------------------------------------------------
Year Ended 10/31:
2005 13.38 12.31 3.07 4.87
2004 13.54 12.74 8.98 9.90
2003 13.15 12.52 3.09 4.12
2002 13.46 12.97 .52 .76
2001 14.22 13.75 18.68 11.28
===============================================================================
Ratios/Supplemental Data
---------------------------------------------------------------------------------------------
Before Credit/Refund After Credit/Refund**
---------------------------- ------------------------------
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:
2005 $947,446 1.19% 6.44% 1.18% 6.45% 20%
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
PREMIUM INCOME 2 (NPM)
-----------------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2005 619,282 1.20 6.40 1.19 6.40 15
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
PREMIUM INCOME 4 (NPT)
-----------------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2005 578,517 1.26 6.63 1.22 6.66 7
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
=============================================================================================================================
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:
2005 $525,000 $25,000 $70,116
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
PREMIUM INCOME 2 (NPM)
---------------------------------------------------------------------------
Year Ended 10/31:
2005 347,000 25,000 69,617
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
PREMIUM INCOME 4 (NPT)
---------------------------------------------------------------------------
Year Ended 10/31:
2005 338,400 25,000 67,739
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
===========================================================================
* 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 and legal fee refund, 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.
56-57 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 Fund is currently set
at nine. 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 (since 1996) and Director of Nuveen Investments, 156
3/28/49 the Board Inc., Nuveen Investments, LLC, Nuveen Advisory Corp. and
333 W. Wacker Drive and Trustee Nuveen Institutional Advisory Corp.(3); Director (since 1996)
Chicago, IL 60606 of Institutional Capital Corporation; Chairman and Director
(since 1997) of Nuveen Asset Management; Chairman and
Director of Rittenhouse Asset Management, Inc. (since 1999);
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. 156
8/22/40
333 W. Wacker Drive
Chicago, IL 60606
------------------------------------------------------------------------------------------------------------------------------------
Lawrence H. Brown Board member 1993 Retired (since 1989) as Senior Vice President of The 156
7/29/34 Northern Trust Company; Director (since 2002) Community
333 W. Wacker Drive Advisory Board for Highland Park and Highwood, United
Chicago, IL 60606 Way of the North Shore.
------------------------------------------------------------------------------------------------------------------------------------
Jack B. Evans Board member 1999 President, The Hall-Perrine Foundation, a private philanthropic 156
10/22/48 corporation (since 1996); Director and Vice Chairman, United
333 W. Wacker Drive Fire Group, a publicly held company; Adjunct Faculty Member,
Chicago, IL 60606 University of Iowa; Director, Gazette Companies; Life Trustee
of Coe College; Director, Iowa College Foundation; formerly,
Director, Alliant Energy; formerly, Director, Federal Reserve
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 156
3/6/48 Business at the University of Connecticut (since 2002);
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
(since 1997), Credit Research Center at Georgetown University;
Director (since 2004) of Xerox Corporation.
------------------------------------------------------------------------------------------------------------------------------------
David J. Kundert Board member 2005 Retired (since 2004) as Chairman, JPMorgan Fleming Asset 154
10/28/42 Management, President and CEO, Banc One Investment
333 W. Wacker Drive Advisors Corporation, and President, One Group Mutual
Chicago, IL 60606 Funds; prior thereto, Executive Vice President, Banc One
Corporation and Chairman and CEO, Banc One Investment
Management Group; Board of Regents, Luther College;
currently a member of the American and Wisconsin Bar
Associations.
58
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 Chairman of Miller-Valentine Partners Ltd., a real estate 156
9/24/44 investment company; formerly, Senior Partner and Chief
333 W. Wacker Drive Operating Officer (retired, December 2004), of Miller-Valentine
Chicago, IL 60606 Group; formerly, Vice President, Miller-Valentine Realty, a
construction company; Board Member, Chair of the Finance Committee
and member of the Audit Committee of Premier Health Partners, the
not-for-profit company of Miami Valley Hospital; Vice President,
Dayton Philharmonic Orchestra Association; Board Member, Regional
Leaders Forum, which promotes cooperation on economic development
issues; Director, Dayton 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 156
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
------------------------------------------------------------------------------------------------------------------------------------
Eugene S. Sunshine Board member 2005 Senior Vice President for Business and Finance, 156
1/22/50 Northwestern University (since 1997); Director (since 2003),
333 W. Wacker Drive Chicago Board Options Exchange; Director (since 2003),
Chicago, IL 60606 National Mentor Holdings, a privately-held, national provider
of home and community-based services; Chairman (since
1997), Board of Directors, Rubicon, a pure captive insurance
company owned by Northwestern University; Director (since
1997), Evanston Chamber of Commerce and Evanston
Inventure, a business development organization.
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(4) DURING PAST 5 YEARS OFFICER
------------------------------------------------------------------------------------------------------------------------------------
OFFICERS OF THE FUND:
------------------------------------------------------------------------------------------------------------------------------------
Gifford R. Zimmerman Chief 1988 Managing Director (since 2002), Assistant Secretary and 156
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 (2002-2004), General Counsel (1998-2004)
and Assistant Secretary, formerly, Vice President of Nuveen
Advisory Corp. and Nuveen Institutional Advisory Corp.(3);
Managing Director (since 2002) and Assistant Secretary and
Associate General Counsel, formerly, Vice President (since
1997), of Nuveen Asset Management; 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.
59
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(4) DURING PAST 5 YEARS OFFICER
------------------------------------------------------------------------------------------------------------------------------------
OFFICERS OF THE FUNDS (CONTINUED):
------------------------------------------------------------------------------------------------------------------------------------
Julia L. Antonatos Vice President 2004 Managing Director (since 2005), formerly Vice President 156
9/22/63 (since 2002); formerly, Assistant Vice President (since 2000)
333 W. Wacker Drive of Nuveen Investments, LLC; Chartered Financial Analyst.
Chicago, IL 60606
------------------------------------------------------------------------------------------------------------------------------------
Michael T. Atkinson Vice President 2000 Vice President (since 2002), formerly, Assistant Vice 156
2/3/66 and Assistant President (since 2000) of Nuveen Investments, LLC.
333 W. Wacker Drive Secretary
Chicago, IL 60606
------------------------------------------------------------------------------------------------------------------------------------
Peter H. D'Arrigo Vice President 1999 Vice President of Nuveen Investments, LLC (since 1999); Vice 156
11/28/67 and Treasurer President and Treasurer (since 1999) of Nuveen Investments,
333 W. Wacker Drive Inc.; Vice President and Treasurer (1999-2004) of Nuveen
Chicago, IL 60606 Advisory Corp. and Nuveen Institutional Advisory Corp.(3);
Vice President and Treasurer of Nuveen Asset Management
(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.
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John N. Desmond Vice President 2005 Vice President, Director of Investment Operations, Nuveen 156
8/24/61 Investments, LLC (since January 2005); formerly, Director,
333 W. Wacker Drive Business Manager, Deutsche Asset Management (2003-2004),
Chicago, IL 60606 Director, Business Development and Transformation, Deutsche
Trust Bank Japan (2002-2003); previously, Senior Vice President, Head
of Investment Operations and Systems, Scudder Investments Japan,
(2000-2002), Senior Vice President, Head of Plan Administration and
Participant Services, Scudder Investments (1995-2002).
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Jessica R. Droeger Vice President 1998 Vice President (since 2002), Assistant Secretary and 156
9/24/64 and Secretary Assistant General Counsel (since 1998) formerly, Assistant
333 W. Wacker Drive Vice President (since 1998) of Nuveen Investments, LLC;
Chicago, IL 60606 Vice President (2002-2004) and Assistant Secretary (1998-2004)
formerly, Assistant Vice President of Nuveen Advisory Corp.
and Nuveen Institutional Advisory Corp.(3); Vice President and
Assistant Secretary (since 2005) of Nuveen Asset Management.
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Lorna C. Ferguson Vice President 1998 Managing Director (since 2004), formerly, Vice President of 156
10/24/45 Nuveen Investments, LLC, Managing Director (2004) formerly,
333 W. Wacker Drive Vice President (1998-2004) of Nuveen Advisory Corp. and
Chicago, IL 60606 Nuveen Institutional Advisory Corp.(3); Managing Director
(since 2005) of Nuveen Asset Management.
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William M. Fitzgerald Vice President 1995 Managing Director (since 2002), formerly, Vice President of 156
3/2/64 Nuveen Investments; Managing Director (1997-2004) of
333 W. Wacker Drive Nuveen Advisory Corp. and Nuveen Institutional Advisory
Chicago, IL 60606 Corp.(3); Managing Director of Nuveen Asset Management
(since 2001); Vice President of Nuveen Investments Advisers
Inc. (since 2002); Chartered Financial Analyst.
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Stephen D. Foy Vice President 1998 Vice President (since 1993) and Funds Controller (since 1998) 156
5/31/54 and Controller of Nuveen Investments, LLC; formerly, Vice President and
333 W. Wacker Drive Funds Controller (1998-2004) of Nuveen Investments, Inc.;
Chicago, IL 60606 Certified Public Accountant.
60
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(4) DURING PAST 5 YEARS OFFICER
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OFFICERS OF THE FUNDS (CONTINUED):
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James D. Grassi Vice President 2004 Vice President and Deputy Director of Compliance (since 2004) 156
4/13/56 and Chief of Nuveen Investments, LLC, Nuveen Investments Advisers Inc.,
333 W. Wacker Drive Compliance Nuveen Asset Management and Rittenhouse Asset Management,
Chicago, IL 60606 Officer Inc.; previously, Vice President and Deputy Director of Compliance
(2004) of Nuveen Advisory Corp. and Nuveen Institutional Advisory
Corp.(3); formerly, Senior Attorney (1994-2004), The Northern
Trust Company.
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David J. Lamb Vice President 2000 Vice President (since 2000) of Nuveen Investments, 156
3/22/63 LLC; Certified Public Accountant.
333 W. Wacker Drive
Chicago, IL 60606
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Tina M. Lazar Vice President 2002 Vice President of Nuveen Investments, LLC (since 1999). 156
8/27/61
333 W. Wacker Drive
Chicago, IL 60606
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Larry W. Martin Vice President 1988 Vice President, Assistant Secretary and Assistant General 156
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.(3); Vice President (since 2005)
and Assistant Secretary of Nuveen Investments, Inc.; Vice
President (since 2005) and Assistant Secretary (since 1997)
of Nuveen Asset Management; 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).
(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) Nuveen Advisory Corp. and Nuveen Institutional Advisory Corp. were
reorganized into Nuveen Asset Management, effective January 1, 2005.
(4) 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.
61
ANNUAL INVESTMENT
MANAGEMENT AGREEMENT
APPROVAL PROCESS
At a meeting held on May 10-12, 2005, the Board of Trustees of the Funds,
including the independent Trustees, unanimously approved the Investment
Management Agreement between each Fund and NAM.
THE APPROVAL PROCESS
To assist the Board in its evaluation of an advisory contract with NAM, the
independent Trustees received a report in adequate time in advance of their
meeting which outlined, among other things, the services provided by NAM; the
organization of NAM, including the responsibilities of various departments and
key personnel; the Fund's past performance as well as the Fund's performance
compared to funds of similar investment objectives compiled by an independent
third party (a "Peer Group"); the profitability of NAM and certain industry
profitability analyses for advisers to unaffiliated investment companies; the
expenses of NAM in providing the various services; the management fees of NAM,
including comparisons of such fees with the management fees of comparable funds
in its Peer Group as well as comparisons of NAM's management fees with the fees
NAM assesses to other types of investment products or accounts, if any; the soft
dollar practices of NAM; and the expenses of each Fund, including comparisons of
the Fund's expense ratios (after any fee waivers) with the expense ratios of its
Peer Group. This information supplements that received by the Board throughout
the year regarding Fund performance, expense ratios, portfolio composition,
trade execution and sales activity.
In addition to the foregoing materials, independent legal counsel to the
independent Trustees provided, in advance of the meeting, a legal memorandum
outlining, among other things, the duties of the Trustees under the 1940 Act as
well as the general principles of relevant state law in reviewing and approving
advisory contracts; the requirements of the 1940 Act in such matters; an
adviser's fiduciary duty with respect to advisory agreements and compensation;
the standards used by courts in determining whether investment company boards of
directors have fulfilled their duties and factors to be considered by the board
in voting on advisory agreements.
At the Board meeting, NAM made a presentation to and responded to questions from
the Board. After the presentations and after reviewing the written materials,
the independent Trustees met privately with their legal counsel to review the
Board's duties in reviewing advisory contracts and consider the renewal of the
advisory contracts. It is with this background that the Trustees considered each
Investment Management Agreement with NAM. The independent Trustees, in
consultation with independent counsel, reviewed the factors set out in judicial
decisions and SEC directives relating to the renewal of advisory contracts. As
outlined in more detail below, the Trustees considered all factors they believed
relevant with respect to each Fund, including the following: (a) the nature,
extent and quality of the services to be provided by NAM; (b) the investment
performance of the Fund and NAM; (c) the costs of the services to be provided
and profits to be realized by NAM and its affiliates from the relationship with
the Fund; (d) the extent to which economies of scale would be realized as the
Fund grows; and (e) whether fee levels reflect these economies of scale for the
benefit of Fund investors.
A. NATURE, EXTENT AND QUALITY OF SERVICES
In evaluating the nature, extent and quality of NAM's services, the Trustees
reviewed information concerning the types of services that NAM or its affiliates
provide and are expected to provide to the Nuveen Funds; narrative and
statistical information concerning the Fund's performance record and how such
performance compares to the Fund's Peer Group; information describing NAM's
organization and its various departments, the experience and responsibilities of
key personnel, and available resources. In the discussion of key personnel, the
Trustees received materials regarding the changes or additions in personnel of
NAM. The Trustees further noted the willingness of the personnel of NAM to
engage in open, candid discussions with the Board. The Trustees further
considered the quality of NAM's investment process in making portfolio
management decisions, including any refinements or improvements to the portfolio
management processes, enhancements to technology and systems that are available
to portfolio managers, and any additions of new personnel which may strengthen
or expand the research and investment capabilities of NAM. In their review of
the advisory contracts for the fixed income funds, such as the Funds, the
Trustees also noted that Nuveen won the Lipper Award for Best Fund Family: Fixed
Income-Large Asset Class, for 2004. Given the Trustees' experience with the
Funds, other Nuveen funds and NAM, the Trustees noted that they were familiar
with and continue to have a good understanding of the organization, operations
and personnel of NAM.
In addition to advisory services, the independent Trustees considered the
quality of the administrative or non-advisory services provided. In this regard,
NAM provides the Funds with such administrative and other services (exclusive
of, and in addition to, any such services provided by others for the Funds) and
officers and other personnel as are necessary for the operations of the
respective Fund. In addition to investment management services, NAM and its
affiliates provide each Fund with a wide range of services, including: preparing
shareholder reports; providing daily accounting; providing quarterly financial
statements; overseeing and coordinating the activities of other service
providers; administering and organizing Board meetings and preparing the Board
materials for such meet-
62
ings; providing legal support (such as helping to prepare registration
statements, amendments thereto and proxy statements and responding to regulatory
inquiries); and performing other Fund administrative tasks necessary for the
operation of the respective Fund (such as tax reporting and fulfilling
regulatory filing requirements). In addition, in evaluating the administrative
services, the Trustees considered, in particular, NAM's policies and procedures
for assuring compliance with applicable laws and regulations in light of the new
SEC regulations governing compliance. The Trustees noted NAM's focus on
compliance and its compliance systems. In their review, the Trustees considered,
among other things, the additions of experienced personnel to NAM's compliance
group and modifications and other enhancements to NAM's computer systems. In
addition to the foregoing, the Trustees also noted that NAM outsources certain
services that cannot be replicated without significant costs or at the same
level of expertise. Such outsourcing has been a beneficial and efficient use of
resources by keeping expenses low while obtaining quality services.
In addition to the above, in reviewing the variety of additional services that
NAM or its affiliates must provide to closed-end funds, such as the Funds, the
independent Trustees determined that Nuveen's commitment to supporting the
secondary market for the common shares of its closed-end funds is particularly
noteworthy. In this regard, the Trustees noted Nuveen's efforts to sponsor
numerous forums for analysts and specialists regarding the various Nuveen
closed-end funds, its creation of a new senior position dedicated to providing
secondary market support services and enhancing communications with investors
and analysts, and its advertising and media relations efforts designed to raise
investor and analyst awareness of the closed-end funds.
With respect to services provided to municipal funds, including the Funds, the
Trustees also noted, among other things, the enhancements NAM implemented to its
municipal portfolio management processes (e.g., the increased use of benchmarks
to guide and assess the performance of its portfolio managers); the
implementation of a risk management program; and the various initiatives being
undertaken to enhance or modify NAM's computer systems as necessary to support
the innovations of the municipal investment team (such as, the ability to assess
certain historical data in order to create customized benchmarks, perform
attribution analysis and facilitate the use of derivatives as hedging
instruments). With respect to certain of the Nuveen funds with a less seasoned
portfolio, the Trustees also noted the hedging program implemented for such
funds and the team responsible for developing, implementing and monitoring the
hedging procedures. The hedging program was designed to help maintain the
applicable fund's duration with certain benchmarks.
Based on their review, the Trustees concluded that, overall, they were satisfied
with the nature, extent and quality of services provided (and expected to be
provided) to the Funds under the Investment Management Agreements.
B. THE INVESTMENT PERFORMANCE OF THE FUND AND ADVISER
As previously noted, the Board received a myriad of performance information
regarding each Fund and its Peer Group. Among other things, the Board received
materials reflecting a Fund's historic performance and the Fund's performance
compared to its Peer Group. In evaluating the performance information, in
certain limited instances, the Trustees noted that the closest Peer Group for a
Fund still would not adequately reflect such Fund's investment objectives and
strategies, thereby limiting the usefulness of the comparisons of such Fund's
performance with that of the Peer Group.
As noted above, the performance data included, among other things, the
respective Fund's performance relative to its peers. More specifically, a Fund's
one-, three- and five-year total returns (as applicable) for the periods ending
December 31, 2004 were evaluated relative to the unaffiliated funds in its
respective Peer Group (including the returns of individual peers as well as the
Peer Group average) as well as additional performance information with respect
to all funds in the Peer Group. Based on their review, the Trustees determined
that the respective Fund's absolute and relative investment performance over
time had been satisfactory.
C. FEES, EXPENSES AND PROFITABILITY
1. FEES AND EXPENSES
In evaluating the management fees and expenses that a Fund is expected to
bear, the Trustees considered the respective Fund's current management fee
structure and the Fund's expected expense ratios in absolute terms as well as
compared with the fees and expense ratios of the unaffiliated funds in its
Peer Group. The Trustees reviewed the financial information of NAM, including
its respective revenues, expenses and profitability. In reviewing fees, the
Trustees, among other things, reviewed comparisons of the Fund's gross
management fees (fees after fund-level and complex-wide level breakpoints but
before reimbursement and fee waivers), net management fees (after breakpoints
and reimbursements and fee waivers) and total expense ratios (before and
after waivers) with those of the unaffiliated funds in the Peer Group and
peer averages. In this regard, the Trustees noted that the relative ranking
of the Nuveen funds on fees and expenses was aided by the significant level
of fee reductions provided by the fund-level and complex-wide breakpoint
schedules, and the fee waivers and reimbursements provided by Nuveen for
certain funds launched since 1999. The complex-wide breakpoint schedule was
instituted in 2004 and is described in further detail below in Section D
entitled "Economies of Scale and Whether Fee Levels Reflect these Economies
of Scale." In their review of the fee and expense information provided,
including, in particular, the expense ratios of the unaffiliated funds in the
respective Peer Group, the Trustees determined that each Fund's net total
expense ratio was within an acceptable range compared to such peers.
2. COMPARISONS WITH THE FEES OF OTHER CLIENTS
The Trustees further compared the fees of NAM to the fees NAM assessed for
other types of clients investing in municipal funds (such as municipal
managed accounts). With respect to such separately managed accounts, the
advisory fees for such accounts are generally lower than those charged to the
comparable Funds. The Trustees noted, however, the additional services that
are provided and the costs incurred by Nuveen in managing and operating
registered investment companies, such as the Funds, compared to individually
managed separate accounts. For instance, as described above, NAM and its
affiliates provide numerous services to the Funds including, but not limited
to, preparing shareholder reports; providing daily accounting; preparing
quarterly
63
ANNUAL INVESTMENT MANAGEMENT
AGREEMENT APPROVAL PROCESS (continued)
financial statements; overseeing and coordinating the activities of other
service providers; administering and organizing Board meetings and preparing
the Board materials for such meetings; providing legal support; and
administering all other aspects of the Fund's operations. Further, the
Trustees noted the increased compliance requirements for funds in light of
new SEC regulations and other legislation. These services are generally not
required to the same extent, if at all, for separate accounts. In addition to
the differences in services, the Trustees also considered, among other
things, the differences in product distribution, investment policies,
investor profiles and account sizes. Accordingly, the Trustees believe that
the nature and number of services provided to operate a Fund merit the higher
fees than those to separate managed accounts.
3. PROFITABILITY OF NAM
In conjunction with its review of fees, the Trustees also considered NAM's
profitability. The Trustees reviewed NAM's revenues, expenses and
profitability margins (on both a pre-tax and after-tax basis). In reviewing
profitability, the Trustees recognized that one of the most difficult issues
in determining profitability is establishing a method of allocating expenses.
Accordingly, the Trustees reviewed NAM's assumptions and methodology of
allocating expenses. In this regard, the methods of allocation used appeared
reasonable but the Board noted the inherent limitations in allocating costs
among various advisory products. The Trustees also recognized that individual
fund or product line profitability of other advisers is generally not
publicly available. Further, profitability may be affected by numerous
factors including the types of funds managed, expense allocations, business
mix, etc. and therefore comparability of profitability is somewhat limited.
Nevertheless, to the extent available, the Trustees considered NAM's profit
margin compared to the profitability of various publicly-traded investment
management companies and/or investment management companies that publicly
disclose some or all of their financial results compiled by three independent
third-party service providers. The Trustees also reviewed the revenues,
expenses and profit margins of various unaffiliated advisory firms with
similar amounts of assets under management for the last year prepared by NAM.
Based on their review, the Trustees were satisfied that NAM's level of
profitability from its relationship with each Fund was reasonable in light of
the services provided.
In evaluating the reasonableness of the compensation, the Trustees also
considered any other revenues paid to NAM as well as any indirect benefits
(such as soft dollar arrangements, if any) NAM and its affiliates are
expected to receive that are directly attributable to their management of the
Funds, if any. See Section E below for additional information. Based on their
review of the overall fee arrangements of the applicable Fund, the Trustees
determined that the advisory fees and expenses of the respective Fund were
reasonable.
D. ECONOMIES OF SCALE AND WHETHER FEE LEVELS REFLECT THESE ECONOMIES OF SCALE
In reviewing the compensation, the Trustees have long understood the benefits of
economies of scale as the assets of a fund grow and have sought to ensure that
shareholders share in these benefits. One method for shareholders to share in
economies of scale is to include breakpoints in the advisory fee schedules that
reduce fees as fund assets grow. Accordingly, the Trustees received and reviewed
the schedules of advisory fees for each Fund, including fund-level breakpoints
thereto. In addition, after lengthy negotiations with management, the Board in
May, 2004 approved a complex-wide fee arrangement pursuant to which fees of the
funds in the Nuveen complex, including the Funds, are reduced as the assets in
the fund complex reach certain levels. The complex-wide fee arrangement was
introduced on August 1, 2004 and the Trustees reviewed data regarding the
reductions of fees for the Nuveen funds for the period of August 1, 2004 to
December 31, 2004. In evaluating the complex-wide fee arrangement, the Trustees
considered, among other things, the historic and expected fee savings to
shareholders as assets grow, the amount of fee reductions at various asset
levels, and that the arrangement would extend to all funds in the Nuveen
complex. The Trustees also considered the impact, if any, the complex-wide fee
arrangement may have on the level of services provided. Based on their review,
the Trustees concluded that the breakpoint schedule and complex-wide fee
arrangement currently were acceptable and desirable in providing benefits from
economies of scale to shareholders.
E. INDIRECT BENEFITS
In evaluating fees, the Trustees also considered any indirect benefits or
profits NAM or its affiliates may receive as a result of its relationship with
each Fund. In this regard, the Trustees considered any benefits from soft dollar
arrangements. The Trustees noted that although NAM manages a large amount of
assets, it has very little, if any, brokerage to allocate. This is due to the
fact that NAM typically manages the portfolios of the municipal funds in the
Nuveen complex and municipal bonds generally trade on a principal basis.
Accordingly, NAM does not currently have any soft dollar arrangements and does
not pay excess brokerage commissions (or spreads on principal transactions) in
order to receive research services. In addition to soft dollar arrangements, the
Trustees also con-
64
sidered any other revenues, if any, received by NAM or its affiliates. In this
regard, the Trustees considered revenues received by Nuveen for serving as agent
for broker-dealers at its preferred trading desk and for acting as co-manager in
the initial public offering of new closed-end exchange-traded funds.
F. OTHER CONSIDERATIONS
Nuveen, until recently, was a majority-owned subsidiary of St. Paul Travelers
Companies, Inc. ("St. Paul"). As noted, St. Paul earlier this year announced its
intention to divest its equity stake in Nuveen. Nuveen is the parent of NAM.
Pursuant to a series of transactions, St. Paul had begun to reduce its interest
in Nuveen which will ultimately result in a change of control of Nuveen and
therefore NAM. As mandated by the 1940 Act, such a change in control would
result in an assignment of the Investment Management Agreements with NAM and the
automatic termination of such agreements. Accordingly, the Board also considered
the approval of a New Investment Management Agreement with each Fund in light
of, and which would take effect upon, the anticipated change of control. More
specifically, the Board considered for each Fund a New Investment Management
Agreement on substantially identical terms to the existing Investment Management
Agreement, to take effect after the change of control has occurred and the
contract has been approved by Fund shareholders. In its review, the Board
considered whether the various transactions necessary to divest St. Paul's
interest will have an impact on the various factors they considered in approving
NAM, such as the scope and quality of services to be provided following the
change of control. In reviewing the St. Paul transactions, the Board considered,
among other things, the impact, if any, on the operations and organizational
structure of NAM; the possible benefits and costs of the transactions to the
respective Fund; the potential implications of any arrangements used by Nuveen
to finance certain of the transactions; the ability of NAM to perform its duties
after the transactions; whether a fee structure or expense ratio would change;
any changes to the current practices of the respective Fund; any changes to the
terms of the advisory agreement; and any anticipated changes to the respective
operations of NAM. Based on its review, the Board determined that St. Paul's
divestiture would not affect the nature and quality of services provided by NAM,
the terms of the respective Investment Management Agreement, including the fees
thereunder, and would not materially affect the organization or operations of
NAM. Accordingly, the Board determined that their analysis of the various
factors regarding their approval of NAM would continue to apply after the change
of control.
G. APPROVAL
The Trustees did not identify any single factor discussed previously as
all-important or controlling. The Trustees, including a majority of independent
Trustees, concluded that the terms of the Investment Management Agreements were
fair and reasonable, that NAM's fees are reasonable in light of the services
provided to each Fund, that the renewal of the NAM Investment Management
Agreements should be approved and that the new, post-change of control NAM
Investment Managements Agreement be approved and recommended to shareholders.
65
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 EXCHANGE-TRADED CLOSED-END FUNDS
DIVIDEND REINVESTMENT PLAN
Your Nuveen Exchange-Traded Closed-End 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
dividends and distributions awaiting reinvestment. Because the market price of
the shares 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.
CALL TODAY TO START REINVESTING DIVIDENDS AND/OR DISTRIBUTIONS
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.
66
Other Useful
INFORMATION
In April, 2005, The St. Paul Travelers Companies, Inc. ("St. Paul Travelers")
sold the majority of its controlling equity interest in Nuveen Investments, Inc.
("Nuveen") to the general public. Nuveen is the parent of Nuveen Asset
Management ("NAM"), which is each Fund's investment manager. This sale was
deemed to be an "assignment" of the investment management agreement between each
Fund and NAM and, if applicable, of the sub-advisory agreement between NAM and
the Fund's sub-adviser. As required by law, the shareholders of each Fund were
asked to approve a new investment management agreement and, if applicable, a new
subadvisory agreement that reflected this change in ownership. The shareholders
of each Fund voted this approval at a Shareholders' Meeting on July 26, 2005.
There were no changes to the investment objectives or management of any Fund as
a result of these actions.
QUARTERLY PORTFOLIO OF INVESTMENTS AND PROXY VOTING INFORMATION
Each Fund's (i) quarterly portfolio of investments, (ii) information regarding
how the Funds voted proxies relating to portfolio securities held during the
12-month period ended June 30, 2005, and (iii) a description of the policies and
procedures that the Funds used to determine how to vote proxies relating to
portfolio securities are available without charge, upon request, by calling
Nuveen Investments toll-free at (800) 257-8787 or on Nuveen's website 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.
CEO CERTIFICATION DISCLOSURE
Each Fund's Chief Executive Officer has submitted to the New York Stock Exchange
the annual CEO certification as required by Section 303A.12(a) of the NYSE
Listed Company Manual.
Each Fund has filed with the Securities and Exchange Commission the
certification of its Chief Executive Officer and Chief Financial Officer
required by Section 302 of the Sarbanes-Oxley Act. 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 expected period over
which a bond's principal and interest will be paid, and consequently is a
measure of the sensitivity of a bond's or bond Fund's value to changes when
market interest rates change. Generally, the longer a bond's 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
David J. Kundert
William J. Schneider
Timothy R. Schwertfeger
Judith M. Stockdale
Eugene S. Sunshine
FUND MANAGER
Nuveen Asset Management
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 repurchased during the period covered by this report. Any future
repurchases will be reported to shareholders in the next annual or semiannual
report.
67
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 more than $131 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 fixed-income 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, talk to
your financial advisor, or call us at (800) 257-8787. Please read the
information provided carefully before you invest.
Be sure to obtain a prospectus, where applicable. Investors should consider the
investment objective and policies, risk considerations, charges and expenses of
the Fund carefully before investing. The prospectus contains this and other
information relevant to an investment in the Fund. For a prospectus, please
contact your securities representative or Nuveen Investments, 333 W. Wacker Dr.,
Chicago, IL 60606. Please read the prospectus carefully before you invest or
send money.
o Share prices
o Fund details
Learn more o Daily financial news
about Nuveen Funds at o Investor education
WWW.NUVEEN.COM/ETF o Interactive planning tools
Logo: NUVEEN Investments
EAN-E-1005D
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. There were no amendments to or waivers
from the Code during the period covered by this report. The registrant has
posted the code of ethics on its website at www.nuveen.com/etf. (To view the
code, click on the Investor Resources drop down menu box, click on Fund
Governance and then click on Code of Conduct.)
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 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.
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, 2005 $ 40,369 $ 0 $ 566 $ 2,750
------------------------------------------------------------------------------------------------------------------------------------
Percentage approved 0% 0% 0% 0%
pursuant to
pre-approval
exception
------------------------------------------------------------------------------------------------------------------------------------
October 31, 2004 $ 38,408 $ 0 $ 364 $ 2,550
------------------------------------------------------------------------------------------------------------------------------------
Percentage approved 0% 0% 0% 0%
pursuant to
pre-approval
exception
------------------------------------------------------------------------------------------------------------------------------------
The above "All Other Fees" are fees paid to audit firms to perform agreed upon
procedures required by the rating agencies to rate fund preferred shares. 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 Asset Management ("NAM" or the "Adviser"), and any entity controlling,
controlled by or under common control with NAM ("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 tables also show 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, 2005 $ 0 $ 282,575 $ 0
---------------------------------------------------------------------------------------------------------------------
Percentage approved 0% 0% 0%
pursuant to
pre-approval
exception
---------------------------------------------------------------------------------------------------------------------
October 31, 2004 $ 0 $ 0 $ 0
---------------------------------------------------------------------------------------------------------------------
Percentage approved 0% 0% 0%
pursuant to
pre-approval
exception
---------------------------------------------------------------------------------------------------------------------
The above "Tax Fees" are primarily fees billed to the Adviser for Fund tax
return preparation.
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's 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, 2005 $ 3,316 $ 282,575 $ 0 $ 285,891
October 31, 2004 $ 2,914 $ 0 $ 0 $ 2,914
The above "Non-Audit Fees billed to Adviser" for 2005 include "Tax-Fees" billed
to Adviser in the amount of $282,575 from previous table.
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 (15 U.S.C. 78c(a)(58)(A)). The
members of the audit committee are Robert P. Bremner, Lawrence H. Brown, Jack B.
Evans, William J. Schneider and Eugene S. Sunshine.
ITEM 6. SCHEDULE OF INVESTMENTS.
See Portfolio of Investments 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.
There have been no material changes to the procedures by which shareholders may
recommend nominees to the registrant's Board implemented after the registrant
last provided disclosure in response to this Item.
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 Securities
Exchange Act of 1934, as amended (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 the code is posted on registrant's website at www.nuveen.com/etf and
there were no amendments during the period covered by this report. (To view the
code, click on the Investor Resources drop down menu box, click on Fund
Governance and then Code of Conduct.)
(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, 2006
-------------------------------------------------------------------
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, 2006
-------------------------------------------------------------------
By (Signature and Title)* /s/ Stephen D. Foy
----------------------------------------------
Stephen D. Foy
Vice President and Controller
(principal financial officer)
Date: January 6, 2006
-------------------------------------------------------------------
* Print the name and title of each signing officer under his or her signature.