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 811-22253
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Nuveen Municipal Value Fund 2
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(Exact name of registrant as specified in charter)
Nuveen Investments
333 West Wacker Drive
Chicago, IL 60606
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(Address of principal executive offices) (Zip code)
Kevin J. McCarthy
Nuveen Investments
333 West Wacker Drive
Chicago, IL 60606
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(Name and address of agent for service)
Registrant's telephone number, including area code: (312) 917-7700
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Date of fiscal year end: October 31
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Date of reporting period: October 31, 2009
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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.
LOGO: NUVEEN INVESTMENTS
Closed-End Funds
Nuveen Investments
Municipal Closed-End Funds
IT'S NOT WHAT YOU EARN, IT'S WHAT YOU KEEP.(R)
Annual Report
October 31, 2009
---------------- ---------------- ----------------- --------------------
NUVEEN MUNICIPAL NUVEEN MUNICIPAL NUVEEN MUNICIPAL NUVEEN ENHANCED
VALUE FUND, INC. VALUE FUND 2 INCOME FUND, INC. MUNICIPAL VALUE FUND
NUV NUW NMI NEV
OCTOBER 09
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LOGO: NUVEEN INVESTMENTS
Chairman's
Letter to Shareholders
[PHOTO OF ROBERT P. BREMNER]
DEAR SHAREHOLDER,
The financial markets in which your Fund operates continue to reflect the larger
economic crosscurrents. The illiquidity that infected global credit markets over
the last year continues to recede but there is concern about the impact of a
reduction in official liquidity support programs. The major institutions that
are the linchpin of the international financial system have strengthened their
capital structures, but many still struggle with losses in their various
portfolios. Global trends include increasing trade and concern about the ability
of the U.S. government to address its substantial budgetary deficits.
While the fixed-income and equity markets have recovered from the lows recorded
in the first quarter of 2009, identifying those developments that will define
the future is never easy, and rarely is it more difficult than at present. A
fundamental component of a successful investment program is a commitment to
remain focused on long-term investment goals even during periods of heightened
market uncertainty. Another component is to re-evaluate investment disciplines
and tactics and to confirm their validity following periods of extreme
volatility and market dislocation, such as we have recently experienced. Your
Board carried out an intensive review of investment performance with these
objectives in mind during April and May of 2009 as part of the annual management
contract renewal process. I encourage you to read the description of this
process in the Annual Investment Management Agreement Approval Process section
of this report. Confirming the appropriateness of a long term investment
strategy is as important for our shareholders as it is for our professional
investment managers. For that reason, I again encourage you to remain in
communication with your financial consultant on this subject.
On behalf of the other members of your Fund's Board, we look forward to
continuing to earn your trust in the months and years ahead.
Sincerely,
/s/ Robert P. Bremner
----------------------------
Robert P. Bremner
Chairman of the Board
December 21, 2009
Nuveen Investments 1
Portfolio Managers' Comments
Nuveen Municipal Value Fund, Inc. (NUV)
Nuveen Municipal Value Fund 2 (NUW)
Nuveen Municipal Income Fund, Inc. (NMI)
Nuveen Enhanced Municipal Value Fund (NEV)
Portfolio managers Tom Spalding and John Wilhelm discuss U.S. economic and
municipal market conditions, key investment strategies, and the performance of
these four Funds. With 33 years of investment experience at Nuveen, Tom has
managed NUV since its inception in 1987, adding portfolio management
responsibility for NUW upon its inception in February 2009. John, who came to
Nuveen in 2001 with 18 years of industry experience, served as co-portfolio
manager of NMI beginning in 2007 and assumed full portfolio management
responsibility for this Fund in March 2009. In September 2009, he also assumed
portfolio management responsibility for the newly introduced Nuveen Enhanced
Municipal Value Fund (NEV).
WHAT FACTORS AFFECTED THE U.S. ECONOMY AND MUNICIPAL MARKET DURING THE
TWELVE-MONTH REPORTING PERIOD ENDED OCTOBER 31, 2009?
During this reporting period, municipal bond prices generally rose as strong
cash flows into municipal bond funds combined with tighter supply of new
tax-exempt issuance to provide favorable supply and demand conditions. As the
period began, there continued to be considerable downward pressure on the
economy. In an effort to improve conditions, the Federal Reserve (Fed), lowered
the fed funds rate to a target range of zero to 0.25% in December 2008, the
lowest level on record. In February 2009, the federal government augmented its
efforts to boost the economy by passing a $787 billion stimulus package, which
joined the $700 billion financial industry rescue package it had passed in late
2008. In March 2009, the Fed announced that, in addition to maintaining the
current rate, it would buy $300 billion in long-term Treasury securities in an
effort to support private credit markets and up to an additional $750 billion in
agency mortgage-backed securities to bolster the credit and housing markets.
In recent months, the measures taken by the Fed and others to ease the economic
recession produced some incipient signs of improvement. In the third quarter of
2009, the U.S. gross domestic product (GDP), posted positive growth (2.8%
annualized) for the first time since the second quarter of 2008. Housing prices
also provided a bright spot between June and September 2009 by recording four
consecutive months of positive returns, the first following three years of
decline. At the same time, inflation remained
CERTAIN STATEMENTS IN THIS REPORT ARE FORWARD-LOOKING STATEMENTS. DISCUSSIONS OF
SPECIFIC INVESTMENTS ARE FOR ILLUSTRATION ONLY AND ARE NOT INTENDED AS
RECOMMENDATIONS OF INDIVIDUAL INVESTMENTS. THE FORWARD-LOOKING STATEMENTS AND
OTHER VIEWS EXPRESSED HEREIN ARE THOSE OF THE PORTFOLIO MANAGERS AS OF THE DATE
OF THIS REPORT. ACTUAL FUTURE RESULTS OR OCCURRENCES MAY DIFFER SIGNIFICANTLY
FROM THOSE ANTICIPATED IN ANY FORWARD-LOOKING STATEMENTS, AND THE VIEWS
EXPRESSED HEREIN ARE SUBJECT TO CHANGE AT ANY TIME, DUE TO NUMEROUS MARKET AND
OTHER FACTORS. THE FUNDS DISCLAIM ANY OBLIGATION TO UPDATE PUBLICLY OR REVISE
ANY FORWARD-LOOKING STATEMENTS OR VIEWS EXPRESSED HEREIN.
2 Nuveen Investments
muted, as the Consumer Price Index (CPI), reflecting a 14% drop in energy
prices, fell 0.2% year-over-year as of October 2009. This marked the seventh
straight month that consumer prices dropped from their levels of a year earlier,
the longest such decline since 1954-1955. The core CPI (which excludes food and
energy) rose 1.7% over the year, within the Fed's unofficial objective of 2.0%
or lower for this measure. However, the economy continued to be stressed by
weakness in the labor markets. October 2009 marked the 22nd consecutive month of
net job losses, with a total of 7.3 million jobs lost since the recession began
in December 2007. This is the biggest decline since the Great Depression. The
national unemployment rate for October 2009 was 10.2%, a 26-year high, up from
6.6% in October 2008.
Municipal market conditions began to show general signs of improvement in
mid-December 2008 and municipal bonds continued to improve throughout most of
2009. This trend was bolstered by the reduced supply of tax-exempt municipal
debt in the marketplace, due in part to the introduction of the Build America
Bond program in April 2009. Build America Bonds are a new class of taxable
municipal debt created as part of the February 2009 economic stimulus package.
These bonds offer municipal issuers a federal subsidy equal to 35% of the
security's interest payments, and therefore provide issuers with an attractive
alternative to traditional tax-exempt debt. As of April 2009, taxable Build
America Bonds issuance totaled $48.5 billion, accounting for almost 20% of new
bonds issued in the municipal market during the period since their introduction.
Over the twelve months ended October 31, 2009, tax-exempt municipal bond
issuance nationwide totaled $404.5 billion, a drop of approximately 10% compared
with the twelve-month period ended October 31, 2008. As mentioned earlier,
demand for tax-exempt bonds was strong during the first ten months of 2009,
especially on the part of individual investors and broker/dealers. The
combination of lower tax-exempt supply and increased demand provided support for
municipal bond prices.
WHAT KEY STRATEGIES WERE USED TO MANAGE THESE FUNDS DURING THIS REPORTING
PERIOD?
During the majority of this twelve-month period, the tax-exempt municipal bond
market was characterized by strong demand, constrained supply of new tax-exempt
bonds and generally improving valuations.
In this environment, our trading activity continued to focus on finding relative
value by taking a bottom-up approach to discover undervalued sectors and
individual credits with the potential to perform well over the long term. In NUV
and NUW, we generally purchased investment-grade quality bonds offering longer
maturities and good call protection, taking advantage of opportunities to
purchase lower-rated bonds as we found attractive candidates. Many of the
additions to our portfolio were in the health-care sector, primarily bonds rated
AA, A or BBB. While the overall supply of new
Nuveen Investments 3
tax-exempt bonds declined, supply was more plentiful in the health care sector
because hospitals generally do not qualify for the Build America Bond program
and so must continue to issue bonds in the tax-exempt municipal market. In
addition, many hospitals were issuing fixed rate bonds during this period in
order to refinance and retire outstanding debt that had initially been issued as
variable rate debt. We completed the initial investment of NUW's assets in the
months that followed its February 2009 introduction. By period end, the Fund was
fully invested in a diversified portfolio of municipal bonds that we believe
positions the Fund well for the future.
In NMI, our focus was on adding to our holdings of credits rated A and BBB and,
to a lesser degree, non-rated and sub-investment grade bonds. These bonds, which
we purchased in both the primary and secondary markets, tended to have
maturities at the longer end of the yield curve, specifically 20 to 30 years.
From a sector perspective, we emphasized hospital and industrial development
revenue (IDR) bonds, both of which we believed to be significant areas of
opportunity.
Some of the cash for new purchases during this period was generated by maturing
or called bonds. In NMI, we also sold some holdings that we believed did not
have much capacity for further price appreciation, such as bonds that we
expected to be pre-refunded within the next twelve months and bonds that were
close to their call dates. While there was considerable issuance of Build
America Bonds over the last half of this period, these bonds do not represent
good investment opportunities for all these Funds because their interest
payments are considered taxable income.
In September 2009, we introduced the Nuveen Enhanced Municipal Value Fund (NEV),
which is designed to invest at least 80% of its assets in investment quality
municipal securities and may invest up to 20% of its managed assets (as defined
in its prospectus) in bonds rated below investment quality or judged to be of
comparable quality under normal circumstances. During the period between NEV's
inception and October 31, 2009, we worked on completing the Fund's initial
investment phase. By period end, NEV was approximately 85% invested. Our
purchases during this initial phase focused primarily on bonds that we believe
will achieve the portfolio's objectives of providing attractive monthly income
exempt from federal income taxes and attractive after-tax total returns over the
long term. This included bonds at the longer end of the maturity spectrum that
offered good call protection and diversification in terms of credit quality and
sector, such as general and limited tax obligation, health care and
single-family housing.
During this period, we added inverse floating rate securities(1) to NEV, so that
all four of these Funds were using inverse floaters as of October 31, 2009. We
employ inverse floaters as a form of leverage for a variety of reasons,
including duration management, income enhancement and total return enhancements.
Coming into this period, NMI also invested in additional types of derivative
instruments(2) designed to help lengthen its duration. These derivatives were
removed during the first part of reporting period.
(1) An inverse floating rate security, also known as an inverse floater, is a
financial instrument designed to pay long-term tax-exempt interest at a
rate that varies inversely with a short-term tax-exempt interest rate
index. For the Nuveen Funds, the index typically used is the Securities
Industry and Financial Markets (SIFM) Municipal Swap Index (previously
referred to as the Bond Market Association Index or BMA). Inverse
floaters, including those inverse floating rate securities in which the
Funds invested during this reporting period, are further defined within
the Notes to Financial Statements and Glossary of Terms Used in this
Report sections of this report.
(2) Each Fund may invest in derivative instruments such as forwards, futures,
options, and swap transactions. For additional information on the
derivative instruments in which each Fund was invested during and at the
end of the reporting period, see the Portfolio of Investments, Financial
Statements, and Notes to Financial Statements sections of this report.
4 Nuveen Investments
HOW DID THE FUNDS PERFORM?
Individual results for these Funds, as well as relevant index and peer group
information, are presented in the accompanying table.
AVERAGE ANNUAL TOTAL RETURNS ON NET ASSET VALUE FOR PERIODS ENDED 10/31/09
1-YEAR 5-YEAR 10-YEAR
--------------------------------------------------------------------------------
NUV 16.51% 3.89% 5.37%
NUW 16.92%* N/A N/A
NMI 18.06% 4.26% 4.51%
NEV -4.15%** N/A N/A
Standard & Poor's (S&P) National Municipal
Bond Index(3) 14.15% 4.04% 5.61%
Lipper General and Insured Unleveraged
Municipal Debt Funds Average(4) 13.90% 3.57% 4.76%
--------------------------------------------------------------------------------
For the twelve months ended October 31, 2009, the total returns on net asset
value (NAV) for both NUV and NMI exceeded the returns of the Standard & Poor's
(S&P) National Municipal Bond Index and the average return for the Lipper
General and Insured Unleveraged Municipal Debt Funds Average. As noted in the
accompanying table, the return shown for NUW is a cumulative since inception
return. Six-month index returns were 5.96% for the S&P National Municipal Bond
Index and 8.08% for the Lipper average. In addition, NEV's return represents the
approximately one-month period between its inception and October 31, 2009. We
also should note that NEV, which was introduced in September 2009, was still in
its initial investment phase as of October 31, 2009, that is, it was not fully
invested for the entire period, which impacted its performance results.
Key management factors that influenced the Funds' returns during this period
included yield curve and duration positioning, credit exposure and sector
allocation.
During this period, yields on tax-exempt bonds generally declined and bond
prices rose, especially at the longer end of the municipal yield curve. As a
result, longer-term bonds generally outperformed credits with shorter
maturities. In general, the greater a Fund's exposure to the longer part of the
yield curve, the greater the positive impact on the Fund's return. Both NUV and
NUW benefited from being relatively heavily weighted in the longer part of the
curve.
As mentioned earlier, our duration strategies in NMI included using derivative
positions during the first part of this period to synthetically extend its
duration. These derivative positions performed well and had a positive impact on
NMI's total return performance.
* NUW's cumulative return represents the period from its inception on
February 25, 2009, through October 31, 2009.
** NEV's cumulative return represents the period from its inception on
September 25, 2009, through October 31, 2009.
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.
(3) The Standard & Poor's (S&P) National Municipal Bond Index is an
unleveraged, market value-weighted index designed to measure the
performance of the investment-grade U.S. municipal bond market. This index
does not reflect any initial or ongoing expenses and is not available for
direct investment.
(4) The Lipper General and Insured Unleveraged Municipal Debt Funds Average is
calculated using the returns of all closed-end funds in this category for
each period as follows: 1-year, 8 funds; 5-years, 7 funds; and 10-years, 7
funds. Fund and Lipper returns assume reinvestment of dividends. You
cannot invest directly in a Lipper Average.
Nuveen Investments 5
While yield curve positioning and duration played important roles in
performance, credit exposure was also a significant factor. As noted earlier,
demand for municipal bonds increased among both institutional and individual
investors during this period. This increase was driven by a variety of factors,
including concerns about potential tax increases, the need to rebalance
portfolio allocations and a growing appetite for additional risk. At the same
time, the supply of new tax-exempt municipal securities declined. As investors
bid up municipal bond prices, bonds rated BBB or lower and non-rated bonds
generally outperformed those rated AAA, and holdings of these bonds made
relative positive contributions to the Funds' performances.
Holdings that generally contributed to the Funds' performances included IDR,
housing and health care bonds. Education, water and sewer, transportation and
special tax bonds also outperformed the general municipal market during this
period, as did zero coupon bonds and credits backed by the 1998 master tobacco
settlement agreement. In NMI, sector allocation was the most significant
positive contributor to performance, helped by strong weightings in health care,
transportation (particularly tollroads) and IDRs. NUV and NUW also benefited
from their relatively heavy exposures to health care, transportation and water
and sewer bonds.
Pre-refunded bonds, which had been one of the top performing segments of the
municipal bond market over the past two years, performed especially poorly
during this period. This underperformance can be attributed primarily to these
bonds' shorter effective maturities and higher credit quality, as they are
usually backed by U.S. Treasury securities. Other market segments that detracted
from relative performance included resource recovery, leasing, and electric
utility bonds. These were the only three revenue sectors that failed to
outperform the overall municipal market during this period. Many general
obligation bonds also failed to keep pace with the overall municipal market.
6 Nuveen Investments
Dividend and Share Price Information
During the twelve-month reporting period ended October 31, 2009, NMI had two
monthly dividend increases, while the dividend of NUV remained stable throughout
the period. NUW, which was introduced in February 2009, paid its initial monthly
dividend distribution in April 2009 and maintained a stable dividend through the
remainder of the reporting period. On November 2, 2009 (following the end of
this reporting period), NEV, which was introduced on September 25, 2009,
announced its initial monthly dividend distribution of $0.0760 per share,
payable on December 1, 2009.
Due to normal portfolio activity, shareholders of NUV received an ordinary
income distribution of $0.0020 per share at the end of December 2008.
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, 2009, all of
the Funds in this report had positive UNII balances for tax purposes. NUV, NMI
and NEV had positive UNII balances and NUW had a negative UNII balance for
financial statement purposes.
SHARE REPURCHASES AND SHARE PRICE INFORMATION
Since the inception of the Funds' repurchase program, the Funds have not
repurchased any of their outstanding shares.
As of October 31, 2009, the Funds' share prices were trading at premiums (+) or
discounts (-) to their NAVs as shown in the accompanying table.
10/31/09 TWELVE-MONTH AVERAGE
FUND (+)PREMIUM/(-)DISCOUNT (+)PREMIUM
--------------------------------------------------------------------------------
NUV +4.21% +2.64%
NUW -2.22% +0.05%*
NMI +2.70% +3.97%
NEV +9.25% +6.57%**
--------------------------------------------------------------------------------
* From the period since inception on February 25, 2009 through October 31,
2009.
** From the period since inception on September 25, 2009 through October 31,
2009.
Nuveen Investments 7
NUV Performance OVERVIEW | Nuveen Municipal Value Fund, Inc. as of October 31,
2009
FUND SNAPSHOT
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Share Price $ 9.91
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Net Asset Value $ 9.51
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Premium/(Discount) to NAV 4.21%
--------------------------------------------------------------------------------
Market Yield 4.72%
--------------------------------------------------------------------------------
Taxable-Equivalent Yield(1) 6.56%
--------------------------------------------------------------------------------
Net Assets ($000) $ 1,872,031
--------------------------------------------------------------------------------
Average Effective Maturity on Securities (Years) 17.53
--------------------------------------------------------------------------------
Modified Duration 8.05
--------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 6/17/87)
--------------------------------------------------------------------------------
ON SHARE PRICE ON NAV
--------------------------------------------------------------------------------
1-Year 20.68% 16.51%
--------------------------------------------------------------------------------
5-Year 6.54% 3.89%
--------------------------------------------------------------------------------
10-Year 7.14% 5.37%
--------------------------------------------------------------------------------
STATES
(as a % of total investments)
--------------------------------------------------------------------------------
Illinois 12.8%
--------------------------------------------------------------------------------
California 11.8%
--------------------------------------------------------------------------------
New York 7.9%
--------------------------------------------------------------------------------
Texas 7.3%
--------------------------------------------------------------------------------
New Jersey 5.6%
--------------------------------------------------------------------------------
Massachusetts 4.7%
--------------------------------------------------------------------------------
Washington 4.1%
--------------------------------------------------------------------------------
Colorado 4.1%
--------------------------------------------------------------------------------
Florida 4.0%
--------------------------------------------------------------------------------
Michigan 3.8%
--------------------------------------------------------------------------------
South Carolina 3.0%
--------------------------------------------------------------------------------
Missouri 2.9%
--------------------------------------------------------------------------------
Louisiana 2.6%
--------------------------------------------------------------------------------
Puerto Rico 2.6%
--------------------------------------------------------------------------------
Ohio 2.3%
--------------------------------------------------------------------------------
Wisconsin 2.0%
--------------------------------------------------------------------------------
Other 18.5%
--------------------------------------------------------------------------------
PORTFOLIO COMPOSITION
(as a % of total investments)
--------------------------------------------------------------------------------
U.S. Guaranteed 21.3%
--------------------------------------------------------------------------------
Tax Obligation/Limited 17.4%
--------------------------------------------------------------------------------
Health Care 16.8%
--------------------------------------------------------------------------------
Transportation 12.5%
--------------------------------------------------------------------------------
Tax Obligation/General 8.1%
--------------------------------------------------------------------------------
Utilities 7.5%
--------------------------------------------------------------------------------
Consumer Staples 5.4%
--------------------------------------------------------------------------------
Other 11.0%
--------------------------------------------------------------------------------
CREDIT QUALITY (AS A % OF TOTAL INVESTMENTS)
[PIE CHART]
AAA/U.S.
Guaranteed 35%
AA 20%
A 25%
BBB 11%
BB or Lower 8%
N/R 1%
2008-2009 MONTHLY TAX-FREE DIVIDENDS PER SHARE(2)
[BAR CHART]
Nov $ 0.039
Dec 0.039
Jan 0.039
Feb 0.039
Mar 0.039
Apr 0.039
May 0.039
Jun 0.039
Jul 0.039
Aug 0.039
Sep 0.039
Oct 0.039
SHARE PRICE PERFORMANCE -- WEEKLY CLOSING PRICE
[LINE CHART]
11/01/08 $ 8.75
9.07
8.62
8.1
8.37
8.43
7.9
8.76
8.64
9.1
9.43
9.39
9.4
9.45
9.46
9.31
8.64
9.09
8.8001
9.0984
8.87
8.914
9.03
9.25
9.07
9.33
9.25
9.28
9.26
9.25
9.28
9.37
9.14
9.23
9.14
9.22
9.37
9.4299
9.4
9.45
9.58
9.41
9.43
9.45
9.58
9.64
9.57
9.796
9.89
9.77
9.53
9.8
10/31/09 9.907
(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 the Fund to investments that generate qualified dividend income,
the Taxable-Equivalent Yield is lower.
(2) The Fund paid shareholders a net ordinary income distribution in December
2008 of $0.0020 per share.
8 Nuveen Investments
NUW Performance OVERVIEW | Nuveen Municipal Value Fund 2 as of October 31, 2009
CREDIT QUALITY (AS A % OF TOTAL INVESTMENTS)
[PIE CHART]
AAA/U.S. Guaranteed 19%
AA 15%
A 40%
BBB 24%
N/R 2%
2009 MONTHLY TAX-FREE DIVIDENDS PER SHARE
[BAR CHART]
Apr $ 0.0750
May 0.0750
Jun 0.0750
Jul 0.0750
Aug 0.0750
Sep 0.0750
Oct 0.0750
SHARE PRICE PERFORMANCE -- WEEKLY CLOSING PRICE
[LINE CHART]
2/25/09 $ 15
15.03
15.15
15
15.02
15
15.08
14.87
14.7614
14.88
15.14
14.98
15.28
15.29
15.23
15.24
15.2968
15.299
15.22
15.32
15.24
15.13
15.34
15.3
15.24
15.3
15.46
15.7
15.59
15.83
15.68
16
15.89
15.9
15.78
10/31/09 15.84
FUND SNAPSHOT
--------------------------------------------------------------------------------
Share Price $ 15.84
--------------------------------------------------------------------------------
Net Asset Value $ 16.20
--------------------------------------------------------------------------------
Premium/(Discount) to NAV -2.22%
--------------------------------------------------------------------------------
Market Yield 5.68%
--------------------------------------------------------------------------------
Taxable-Equivalent Yield(1) 7.89%
--------------------------------------------------------------------------------
Net Assets ($000) $ 205,709
--------------------------------------------------------------------------------
Average Effective Maturity on Securities (Years) 26.39
--------------------------------------------------------------------------------
Modified Duration 9.83
--------------------------------------------------------------------------------
CUMULATIVE TOTAL RETURN
(Inception 2/25/09)
--------------------------------------------------------------------------------
ON SHARE PRICE ON NAV
--------------------------------------------------------------------------------
Since Inception 9.27% 16.92%
--------------------------------------------------------------------------------
STATES
(as a % of total investments)
--------------------------------------------------------------------------------
Illinois 12.1%
--------------------------------------------------------------------------------
California 10.1%
--------------------------------------------------------------------------------
Florida 8.9%
--------------------------------------------------------------------------------
Wisconsin 8.3%
--------------------------------------------------------------------------------
Louisiana 7.5%
--------------------------------------------------------------------------------
Texas 7.5%
--------------------------------------------------------------------------------
Ohio 5.9%
--------------------------------------------------------------------------------
Indiana 5.4%
--------------------------------------------------------------------------------
Colorado 5.2%
--------------------------------------------------------------------------------
Puerto Rico 3.8%
--------------------------------------------------------------------------------
Arizona 3.5%
--------------------------------------------------------------------------------
Nevada 3.1%
--------------------------------------------------------------------------------
Other 18.7%
--------------------------------------------------------------------------------
PORTFOLIO COMPOSITION
(as a % of total investments)
--------------------------------------------------------------------------------
Health Care 24.2%
--------------------------------------------------------------------------------
Tax Obligation/Limited 21.4%
--------------------------------------------------------------------------------
Transportation 12.8%
--------------------------------------------------------------------------------
Tax Obligation/General 12.1%
--------------------------------------------------------------------------------
Utilities 8.9%
--------------------------------------------------------------------------------
Consumer Staples 6.2%
--------------------------------------------------------------------------------
Water and Sewer 5.0%
--------------------------------------------------------------------------------
Other 9.4%
--------------------------------------------------------------------------------
(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 the Fund to investments that generate qualified dividend income,
the Taxable-Equivalent Yield is lower.
Nuveen Investments 9
NMI Performance OVERVIEW | Nuveen Municipal Income Fund, Inc. as of October 31,
2009
FUND SNAPSHOT
--------------------------------------------------------------------------------
Share Price $ 10.66
--------------------------------------------------------------------------------
Net Asset Value $ 10.38
--------------------------------------------------------------------------------
Premium/(Discount) to NAV 2.70%
--------------------------------------------------------------------------------
Market Yield 5.29%
--------------------------------------------------------------------------------
Taxable-Equivalent Yield(1) 7.35%
--------------------------------------------------------------------------------
Net Assets ($000) $ 84,883
--------------------------------------------------------------------------------
Average Effective Maturity on Securities (Years) 14.76
--------------------------------------------------------------------------------
Modified Duration 6.94
--------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 4/20/88)
--------------------------------------------------------------------------------
ON SHARE PRICE ON NAV
--------------------------------------------------------------------------------
1-Year 13.72% 18.06%
--------------------------------------------------------------------------------
5-Year 6.31% 4.26%
--------------------------------------------------------------------------------
10-Year 5.26% 4.51%
--------------------------------------------------------------------------------
STATES
(as a % of total investments)
--------------------------------------------------------------------------------
California 17.3%
--------------------------------------------------------------------------------
Texas 10.4%
--------------------------------------------------------------------------------
Illinois 9.8%
--------------------------------------------------------------------------------
Colorado 6.6%
--------------------------------------------------------------------------------
New York 5.6%
--------------------------------------------------------------------------------
Missouri 4.9%
--------------------------------------------------------------------------------
South Carolina 4.7%
--------------------------------------------------------------------------------
Ohio 3.7%
--------------------------------------------------------------------------------
Indiana 3.5%
--------------------------------------------------------------------------------
Michigan 3.5%
--------------------------------------------------------------------------------
Virginia 2.9%
--------------------------------------------------------------------------------
Virgin Islands 2.9%
--------------------------------------------------------------------------------
Florida 2.8%
--------------------------------------------------------------------------------
Tennessee 2.7%
--------------------------------------------------------------------------------
Other 18.7%
--------------------------------------------------------------------------------
PORTFOLIO COMPOSITION
(as a % of total investments)
--------------------------------------------------------------------------------
Health Care 19.6%
--------------------------------------------------------------------------------
U.S. Guaranteed 17.1%
--------------------------------------------------------------------------------
Utilities 15.3%
--------------------------------------------------------------------------------
Tax Obligation/Limited 12.5%
--------------------------------------------------------------------------------
Tax Obligation/General 8.7%
--------------------------------------------------------------------------------
Education and Civic Organizations 5.8%
--------------------------------------------------------------------------------
Water and Sewer 5.2%
--------------------------------------------------------------------------------
Materials 5.1%
--------------------------------------------------------------------------------
Other 10.7%
--------------------------------------------------------------------------------
CREDIT QUALITY (AS A % OF TOTAL INVESTMENTS)
[PIE CHART]
AAA/U.S.
Guaranteed 29%
AA 6%
A 24%
BBB 26%
BB or Lower 6%
N/R 9%
2008-2009 MONTHLY TAX-FREE DIVIDENDS PER SHARE
[BAR CHART]
Nov $ 0.042
Dec 0.042
Jan 0.042
Feb 0.042
Mar 0.0445
Apr 0.0445
May 0.0445
Jun 0.0445
Jul 0.0445
Aug 0.0445
Sep 0.047
Oct 0.047
SHARE PRICE PERFORMANCE -- WEEKLY CLOSING PRICE
[LINE CHART]
11/01/08 $ 9.80
10.00
9.97
9.29
9.46
9.70
8.66
9.06
9.20
9.74
10.16
9.89
9.67
10.00
10.15
10.03
9.33
9.93
9.59
10.03
9.69
9.81
9.84
9.98
10.08
9.98
10.45
10.26
10.53
10.33
10.41
10.34
10.13
10.3399
10.25
10.23
10.23
10.31
10.41
10.61
10.51
10.5
10.711
10.75
10.91
10.73
10.75
10.9
10.9
10.998
10.43
10.74
10/31/09 10.66
(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 the Fund to investments that generate qualified dividend income,
the Taxable-Equivalent Yield is lower.
10 Nuveen Investments
NEV Performance OVERVIEW | Nuveen Enhanced Municipal Value Fund as of October
31, 2009
CREDIT QUALITY (AS A % OF TOTAL INVESTMENTS)
[PIE CHART]
AAA/U.S.
Guaranteed 24%
AA 29%
A 15%
BBB 20%
BB or Lower 7%
N/R 5%
SHARE PRICE PERFORMANCE -- WEEKLY CLOSING PRICE(2)
[LINE CHART]
9/25/09 $ 15.00
15.00
15.00
15.01
15.01
10/31/09 15.00
FUND SNAPSHOT
--------------------------------------------------------------------------------
Share Price $ 15.00
--------------------------------------------------------------------------------
Net Asset Value $ 13.73
--------------------------------------------------------------------------------
Premium/(Discount) to NAV 9.25%
--------------------------------------------------------------------------------
Market Yield N/A
--------------------------------------------------------------------------------
Taxable-Equivalent Yield(1) N/A
--------------------------------------------------------------------------------
Net Assets ($000) $ 244,558
--------------------------------------------------------------------------------
Average Effective Maturity on Securities (Years) 25.46
--------------------------------------------------------------------------------
Modified Duration 15.25
--------------------------------------------------------------------------------
CUMULATIVE TOTAL RETURN
(Inception 9/25/09)
--------------------------------------------------------------------------------
ON SHARE PRICE ON NAV
--------------------------------------------------------------------------------
Since
Inception --% -4.15%
--------------------------------------------------------------------------------
STATES
(as a % of total investments)
--------------------------------------------------------------------------------
California 20.4%
--------------------------------------------------------------------------------
Florida 10.6%
--------------------------------------------------------------------------------
Michigan 10.1%
--------------------------------------------------------------------------------
Ohio 8.3%
--------------------------------------------------------------------------------
Texas 6.6%
--------------------------------------------------------------------------------
Arizona 5.8%
--------------------------------------------------------------------------------
Indiana 5.5%
--------------------------------------------------------------------------------
Pennsylvania 5.1%
--------------------------------------------------------------------------------
Colorado 4.2%
--------------------------------------------------------------------------------
Massachusetts 4.1%
--------------------------------------------------------------------------------
Other 19.3%
--------------------------------------------------------------------------------
PORTFOLIO COMPOSITION
(as a % of total investments)
--------------------------------------------------------------------------------
Health Care 27.3%
--------------------------------------------------------------------------------
Tax Obligation/General 14.6%
--------------------------------------------------------------------------------
Tax Obligation/Limited 12.8%
--------------------------------------------------------------------------------
Utilities 10.7%
--------------------------------------------------------------------------------
Consumer Staples 8.3%
--------------------------------------------------------------------------------
Education and Civic Organizations 6.9%
--------------------------------------------------------------------------------
Housing/Single Family 5.9%
--------------------------------------------------------------------------------
Other 13.5%
--------------------------------------------------------------------------------
(1) Taxable-Equivalent Yield represents the yield that must be earned on a
fully taxable investment in order to equal the yield of the Fund on an
after-tax basis. It is based on a federal income tax rate of 28%. When
comparing the Fund to investments that generate qualified dividend income,
the Taxable-Equivalent Yield is lower.
(2) Weekly Closing Price during the period 9/25/09 through 10/31/09 was
$15.00.
N/A The Fund declared its first dividend distribution on November 2, 2009,
subsequent to the reporting period.
Nuveen Investments 11
NUV NMI | Shareholder Meeting Report
The annual meeting of shareholders was held on July 28, 2009, in the Lobby
Conference Room, 333 West Wacker Drive, Chicago, IL 60606; at this meeting the
shareholders were asked to vote on the election of Board Members.
NUV NMI
-------------------------------------------------------------------------------------
Common shares Common shares
=====================================================================================
APPROVAL OF THE BOARD MEMBERS WAS REACHED AS FOLLOWS:
Robert P. Bremner
For 161,158,757 6,659,621
Withhold 5,196,917 202,976
-------------------------------------------------------------------------------------
Total 166,355,674 6,862,597
=====================================================================================
Jack B. Evans
For 161,323,450 6,682,223
Withhold 5,032,224 180,374
-------------------------------------------------------------------------------------
Total 166,355,674 6,862,597
=====================================================================================
William J. Schneider
For 161,330,644 6,692,883
Withhold 5,025,030 169,714
-------------------------------------------------------------------------------------
Total 166,355,674 6,862,597
=====================================================================================
12 Nuveen Investments
Report of Independent
Registered Public Accounting Firm
THE BOARD OF DIRECTORS/TRUSTEES AND SHAREHOLDERS
NUVEEN MUNICIPAL VALUE FUND, INC.
NUVEEN MUNICIPAL VALUE FUND 2
NUVEEN MUNICIPAL INCOME FUND, INC.
NUVEEN ENHANCED MUNICIPAL VALUE FUND
We have audited the accompanying statements of assets and liabilities, including
the portfolios of investments, of Nuveen Municipal Value Fund, Inc., Nuveen
Municipal Value Fund 2, Nuveen Municipal Income Fund, Inc. and Nuveen Enhanced
Municipal Value Fund (the "Funds") as of October 31, 2009, and the related
statements of operations, changes in net assets and the financial highlights for
the periods indicated therein. 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, 2009, by correspondence with the custodian
and brokers or by 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 Municipal Value Fund, Inc., Nuveen Municipal Value Fund 2, Nuveen
Municipal Income Fund, Inc. and Nuveen Enhanced Municipal Value Fund at October
31, 2009, the results of their operations, changes in their net assets and the
financial highlights for the periods indicated therein in conformity with US
generally accepted accounting principles.
Ernst & Young LLP
Chicago, Illinois
December 28, 2009
Nuveen Investments 13
NUV | Nuveen Municipal Value Fund, Inc.
| Portfolio of Investments October 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
ALABAMA - 0.1%
$ 1,750 Huntsville Healthcare Authority, Alabama, Revenue Bonds, 6/11 at 101.00 A2 (4) $ 1,905,505
Series 2001A, 5.750%, 6/01/31 (Pre-refunded 6/01/11)
------------------------------------------------------------------------------------------------------------------------------------
ALASKA - 0.4%
3,335 Alaska Housing Finance Corporation, General Housing Purpose 12/14 at 100.00 AA 3,390,228
Bonds, Series 2005A, 5.000%, 12/01/30 - FGIC Insured
3,000 Anchorage, Alaska, General Obligation Bonds, Series 2003B, 9/13 at 100.00 AA (4) 3,394,860
5.000%, 9/01/23 (Pre-refunded 9/01/13) - FGIC Insured
1,260 Northern Tobacco Securitization Corporation, Alaska, Tobacco 6/10 at 100.00 AAA 1,295,746
Settlement Asset-Backed Bonds, Series 2000, 6.200%, 6/01/22
(Pre-refunded 6/01/10)
------------------------------------------------------------------------------------------------------------------------------------
7,595 Total Alaska 8,080,834
------------------------------------------------------------------------------------------------------------------------------------
ARIZONA - 1.4%
13,100 Arizona Health Facilities Authority, Hospital Revenue Bonds, 7/10 at 101.00 N/R (4) 13,720,285
Catholic Healthcare West, Series 1999A, 6.625%, 7/01/20
(Pre-refunded 7/01/10)
1,400 Arizona Health Facilities Authority, Hospital System Revenue 2/12 at 101.00 N/R (4) 1,564,262
Bonds, Phoenix Children's Hospital, Series 2002A, 6.250%,
2/15/21 (Pre-refunded 2/15/12)
2,500 Phoenix, Arizona, Civic Improvement Corporation, Senior Lien 7/18 at 100.00 AA- 2,492,275
Airport Revenue Bonds, Series 2008A, 5.000%, 7/01/38
2,575 Quechan Indian Tribe of the Fort Yuma Reservation, Arizona, 12/17 at 102.00 N/R 2,021,684
Government Project Bonds, Series 2007, 7.000%, 12/01/27
5,600 Salt Verde Financial Corporation, Arizona, Senior Gas Revenue No Opt. Call A 4,789,960
Bonds, Series 2007, 5.000%,12/01/37
1,000 Scottsdale Industrial Development Authority, Arizona, Hospital 9/13 at 100.00 A3 991,170
Revenue Bonds, Scottsdale Healthcare, Series 2008A, 5.250%,
9/01/30
------------------------------------------------------------------------------------------------------------------------------------
26,175 Total Arizona 25,579,636
------------------------------------------------------------------------------------------------------------------------------------
ARKANSAS - 0.2%
2,000 Cabot School District 4, Lonoke County, Arkansas, General 2/10 at 100.00 A1 2,000,160
Obligation Refunding Bonds, Series 2003, 5.000%, 2/01/32 -
AMBAC Insured
2,000 University of Arkansas, Fayetteville, Various Facilities 12/12 at 100.00 Aa3 2,029,580
Revenue Bonds, Series 2002, 5.000%, 12/01/32 - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
4,000 Total Arkansas 4,029,740
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA - 11.9%
California Department of Water Resources, Power Supply Revenue
Bonds, Series 2002A:
10,000 5.125%, 5/01/19 (Pre-refunded 5/01/12) 5/12 at 101.00 Aaa 11,117,800
10,000 5.250%, 5/01/20 (Pre-refunded 5/01/12) 5/12 at 101.00 Aaa 11,148,600
California Health Facilities Financing Authority, Revenue
Bonds, Kaiser Permanante System, Series 2006:
5,000 5.000%, 4/01/37 - BHAC Insured 4/16 at 100.00 AAA 5,062,750
6,000 5.000%, 4/01/37 4/16 at 100.00 A+ 5,577,480
6,830 California Infrastructure Economic Development Bank, Revenue 10/11 at 101.00 A- 6,449,364
Bonds, J. David Gladstone Institutes, Series 2001, 5.250%,
10/01/34
1,500 California Pollution Control Financing Authority, Revenue 6/17 at 100.00 A3 1,425,915
Bonds, Pacific Gas and Electric Company, Series 2004C,
4.750%, 12/01/23 - FGIC Insured (Alternative Minimum Tax)
11,570 California Statewide Community Development Authority, 4/10 at 100.50 BBB 11,623,453
Certificates of Participation, Internext Group, Series
1999, 5.375%, 4/01/17
3,500 California Statewide Community Development Authority, Revenue 8/19 at 100.00 AA 3,755,395
Bonds, Methodist Hospital Project, Series 2009, 6.750%,
2/01/38
3,600 California Statewide Community Development Authority, Revenue 7/18 at 100.00 AA- 3,714,408
Bonds, St. Joseph Health System, Series 2007A, 5.750%,
7/01/47 - FGIC Insured
14 Nuveen Investments
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA (continued)
California, General Obligation Bonds, Series 2003:
$ 14,600 5.250%, 2/01/28 8/13 at 100.00 A $ 14,618,396
11,250 5.000%, 2/01/33 8/13 at 100.00 A 10,614,488
16,000 California, Various Purpose General Obligation Bonds, Series 6/17 at 100.00 A 14,977,920
2007, 5.000%, 6/01/37
5,000 Coast Community College District, Orange County, California, 8/18 at 100.00 AAA 4,087,550
General Obligation Bonds, Series 2006C, 5.000%, 8/01/32 -
FSA Insured
30,000 Foothill/Eastern Transportation Corridor Agency, California, No Opt. Call AAA 18,285,300
Toll Road Revenue Bonds, Series 1995A, 0.000%, 1/01/22 (ETM)
21,150 Golden State Tobacco Securitization Corporation, California, 6/13 at 100.00 AAA 23,470,365
Enhanced Tobacco Settlement Asset-Backed Bonds, Series
2003B, 5.000%, 6/01/38 (Pre-refunded 6/01/13) - AMBAC
Insured
Golden State Tobacco Securitization Corporation, California,
Enhanced Tobacco Settlement Asset-Backed Bonds, Series
2007A-1:
7,090 5.000%, 6/01/33 6/17 at 100.00 BBB 5,410,237
1,500 5.125%, 6/01/47 6/17 at 100.00 BBB 996,585
3,540 Golden State Tobacco Securitization Corporation, California, 6/13 at 100.00 AAA 4,142,473
Tobacco Settlement Asset-Backed Bonds, Series 2003A-1,
6.750%, 6/01/39 (Pre-refunded 6/01/13)
Golden State Tobacco Securitization Corporation, California,
Tobacco Settlement Asset-Backed Revenue Bonds, Series 2005A:
5,000 5.000%, 6/01/38 - FGIC Insured 6/15 at 100.00 A- 4,419,300
10,000 5.000%, 6/01/45 6/15 at 100.00 A- 8,614,100
9,000 Los Angeles Department of Water and Power, California, 7/11 at 100.00 AA 9,048,690
Waterworks Revenue Refunding Bonds, Series 2001A, 5.125%,
7/01/41
4,000 Los Angeles Regional Airports Improvement Corporation, 12/12 at 102.00 B- 3,829,520
California, Sublease Revenue Bonds, Los
Angeles International Airport, American Airlines Inc.
Terminal 4 Project, Series 2002C, 7.500%, 12/01/24
(Alternative Minimum Tax)
Merced Union High School District, Merced County, California,
General Obligation Bonds, Series 1999A:
2,500 0.000%, 8/01/23 - FGIC Insured No Opt. Call A+ 1,165,450
2,555 0.000%, 8/01/24 - FGIC Insured No Opt. Call A+ 1,114,108
2,365 Montebello Unified School District, Los Angeles County, No Opt. Call A+ 845,322
California, General Obligation Bonds, Series 2004, 0.000%,
8/01/27 - FGIC Insured
3,550 M-S-R Energy Authority, California, Gas Revenue Bonds, No Opt. Call A 3,790,442
Citigroup Prepay Contracts, Series 2009C, 6.500%, 11/01/39
8,000 Rancho Mirage Joint Powers Financing Authority, California, 7/14 at 100.00 A3 (4) 9,346,720
Revenue Bonds, Eisenhower Medical Center, Series 2004,
5.625%, 7/01/34 (Pre-refunded 7/01/14)
15,405 Riverside Public Financing Authority, California, University 8/17 at 100.00 A 13,005,363
Corridor Tax Allocation Bonds, Series 2007C, 5.000%,
8/01/37 - NPFG Insured
San Bruno Park School District, San Mateo County, California,
General Obligation Bonds, Series 2000B:
2,575 0.000%, 8/01/24 - FGIC Insured No Opt. Call A+ 1,122,829
2,660 0.000%, 8/01/25 - FGIC Insured No Opt. Call A+ 1,084,083
14,605 San Joaquin Hills Transportation Corridor Agency, Orange No Opt. Call A 2,275,459
County, California, Toll Road Revenue Refunding Bonds,
Series 1997A, 0.000%, 1/15/35 - NPFG Insured
5,000 San Jose, California, Airport Revenue Bonds, Series 2007A, 3/17 at 100.00 A 5,120,950
6.000%, 3/01/47 - AMBAC Insured (Alternative Minimum Tax)
1,024 Yuba County Water Agency, California, Yuba River Development 3/10 at 100.00 Baa3 996,547
Revenue Bonds, Pacific Gas and Electric Company, Series
1966A, 4.000%, 3/01/16
------------------------------------------------------------------------------------------------------------------------------------
256,369 Total California 222,257,362
------------------------------------------------------------------------------------------------------------------------------------
Nuveen Investments 15
NUV | Nuveen Municipal Value Fund, Inc. (continued)
| Portfolio of Investments October 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
COLORADO - 4.1%
$ 5,000 Arkansas River Power Authority, Colorado, Power Revenue Bonds, 10/16 at 100.00 BBB $ 4,479,050
Series 2006, 5.250%, 10/01/40 - SYNCORA GTY Insured
1,800 Colorado Educational and Cultural Facilities Authority, 8/11 at 100.00 AAA 2,018,286
Charter School Revenue Bonds, Peak-to-Peak Charter School,
Series 2001, 7.625%, 8/15/31 (Pre-refunded 8/15/11)
5,000 Colorado Health Facilities Authority, Colorado, Revenue Bonds, 9/16 at 100.00 AA 4,326,000
Catholic Health Initiatives, Series 2006A, 4.500%, 9/01/38
2,100 Colorado Health Facilities Authority, Revenue Bonds, Catholic 3/12 at 100.00 AA (4) 2,258,088
Health Initiatives, Series 2002A, 5.500%, 3/01/32 (ETM)
750 Colorado Health Facilities Authority, Revenue Bonds, Longmont 12/16 at 100.00 Baa2 672,728
United Hospital, Series 2006B, 5.000%, 12/01/23 - RAAI
Insured
1,700 Colorado Health Facilities Authority, Revenue Bonds, Poudre 9/18 at 102.00 AAA 1,702,941
Valley Health System, Series 2005C, 5.250%, 3/01/40 - FSA
Insured
500 Colorado Health Facilities Authority, Revenue Bonds, Vail 1/12 at 100.00 BBB+ 503,240
Valley Medical Center, Series 2001, 5.750%, 1/15/22
18,915 Denver, Colorado, Airport System Revenue Refunding Bonds, 11/13 at 100.00 A+ 18,500,383
Series 2003B, 5.000%, 11/15/33 - SYNCORA GTY Insured
5,000 E-470 Public Highway Authority, Colorado, Senior Revenue 9/10 at 102.00 AAA 5,323,050
Bonds, Series 2000A, 5.750%, 9/01/35 (Pre-refunded
9/01/10) - NPFG Insured
E-470 Public Highway Authority, Colorado, Senior Revenue
Bonds, Series 2000B:
24,200 0.000%, 9/01/31 - NPFG Insured No Opt. Call A 5,513,486
16,500 0.000%, 9/01/32 - NPFG Insured No Opt. Call A 3,497,505
39,700 E-470 Public Highway Authority, Colorado, Senior Revenue 9/10 at 31.42 Aaa 12,396,325
Bonds, Series 2000B, 0.000%, 9/01/28 (Pre-refunded
9/01/10) - NPFG Insured
6,600 E-470 Public Highway Authority, Colorado, Toll Revenue Bonds, No Opt. Call A 812,856
Refunding Series 2006B, 0.000%, 9/01/39 - NPFG Insured
10,000 E-470 Public Highway Authority, Colorado, Toll Revenue Bonds, No Opt. Call A 1,647,000
Series 2004B, 0.000%, 3/01/36 - NPFG Insured
5,000 Ebert Metropolitan District, Colorado, Limited Tax General 12/17 at 100.00 BBB- 4,498,650
Obligation Bonds, Series 2007, 5.350%, 12/01/37 - RAAI
Insured
1,450 Northwest Parkway Public Highway Authority, Colorado, Revenue 6/11 at 102.00 N/R (4) 1,586,228
Bonds, Senior Series 2001A, 5.500%, 6/15/19 (Pre-refunded
6/15/11) - AMBAC Insured
7,000 Northwest Parkway Public Highway Authority, Colorado, Revenue 6/16 at 100.00 N/R (4) 7,379,190
Bonds, Senior Series 2001C, 0.000%, 6/15/21 (Pre-refunded
6/15/16) - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
151,215 Total Colorado 77,115,006
------------------------------------------------------------------------------------------------------------------------------------
CONNECTICUT - 0.3%
8,670 Mashantucket Western Pequot Tribe, Connecticut, Subordinate 11/17 at 100.00 N/R 4,633,855
Special Revenue Bonds, Series 2007A, 5.750%, 9/01/34
------------------------------------------------------------------------------------------------------------------------------------
DISTRICT OF COLUMBIA - 0.5%
10,000 Washington Convention Center Authority, District of Columbia, 10/16 at 100.00 A 9,255,200
Senior Lien Dedicated Tax Revenue Bonds, Series 2007A,
4.500%, 10/01/30 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
FLORIDA - 4.1%
4,000 Escambia County Health Facilities Authority, Florida, Revenue 11/12 at 101.00 Aa1 4,145,280
Bonds, Ascension Health Credit Group, Series 2002C, 5.750%,
11/15/32
10,000 Florida State Board of Education, Public Education Capital 6/15 at 101.00 AAA 9,760,500
Outlay Bonds, Series 2005E, 4.500%, 6/01/35 (UB)
1,750 Hillsborough County Industrial Development Authority, Florida, 10/16 at 100.00 A3 1,615,478
Hospital Revenue Bonds, Tampa General Hospital, Series
2006, 5.250%, 10/01/41
10,690 Jacksonville, Florida, Better Jacksonville Sales Tax Revenue 10/11 at 100.00 AA- 10,786,851
Bonds, Series 2001, 5.000%, 10/01/30 - AMBAC Insured
16 Nuveen Investments
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
FLORIDA (continued)
$ 3,000 JEA, Florida, Electric System Revenue Bonds, Series 2006-3A, 4/15 at 100.00 AAA $ 3,027,360
5.000%, 10/01/41 - FSA Insured
4,880 Lee County, Florida, Airport Revenue Bonds, Series 2000A, 10/10 at 101.00 AAA 4,942,220
6.000%, 10/01/32 - FSA Insured (Alternative Minimum Tax)
5,000 Marion County Hospital District, Florida, Revenue Bonds, Munroe 10/17 at 100.00 A3 4,277,100
Regional Medical Center, Series 2007, 5.000%, 10/01/34
4,895 Orange County Health Facilities Authority, Florida, Hospital 4/10 at 101.00 A 4,946,544
Revenue Bonds, Orlando Regional Healthcare System, Series
1999E, 6.000%, 10/01/26
8,250 Orange County School Board, Florida, Certificates of 8/12 at 100.00 AA- 8,310,473
Participation, Series 2002A, 5.000%, 8/01/27 - NPFG Insured
9,250 Port Saint Lucie. Florida, Special Assessment Revenue Bonds, 7/17 at 100.00 A 7,968,320
Southwest Annexation District 1B, Series 2007, 5.000%,
7/01/40 - NPFG Insured
2,500 Seminole Tribe of Florida, Special Obligation Bonds, Series 10/17 at 100.00 BBB 2,260,100
2007A, 5.250%, 10/01/27, 144A
14,730 South Miami Health Facilities Authority, Florida, Revenue 8/17 at 100.00 AA- 13,827,788
Bonds, Baptist Health Systems of South Florida, 5.000%,
8/15/42 (UB)
------------------------------------------------------------------------------------------------------------------------------------
78,945 Total Florida 75,868,014
------------------------------------------------------------------------------------------------------------------------------------
GEORGIA - 1.0%
10,240 Atlanta, Georgia, Water and Wastewater Revenue Bonds, Series 5/11 at 100.00 A 9,350,246
1999A, 5.000%, 11/01/38 - FGIC Insured
2,500 Atlanta, Georgia, Water and Wastewater Revenue Bonds, Series 5/12 at 100.00 A 2,337,675
2001A, 5.000%, 11/01/33 - NPFG Insured
4,000 Augusta, Georgia, Water and Sewerage Revenue Bonds, Series 10/14 at 100.00 AAA 4,130,040
2004, 5.250%, 10/01/39 - FSA Insured
2,250 Royston Hospital Authority, Georgia, Revenue Anticipation 1/10 at 102.00 N/R 2,011,208
Certificates, Ty Cobb Healthcare System Inc., Series 1999,
6.500%, 7/01/27
------------------------------------------------------------------------------------------------------------------------------------
18,990 Total Georgia 17,829,169
------------------------------------------------------------------------------------------------------------------------------------
HAWAII - 0.7%
12,325 Honolulu City and County, Hawaii, General Obligation Bonds, 3/13 at 100.00 AA 12,966,270
Series 2003A, 5.250%, 3/01/28 - NPFG Insured
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS - 12.9%
2,060 Aurora, Illinois, Golf Course Revenue Bonds, Series 2000, 1/10 at 100.00 A+ 2,066,304
6.375%, 1/01/20
17,205 Chicago Board of Education, Illinois, Unlimited Tax General No Opt. Call AA- 7,908,622
Obligation Bonds, Dedicated Tax Revenues, Series 1998B-1,
0.000%, 12/01/24 - FGIC Insured
775 Chicago Greater Metropolitan Sanitary District, Illinois, No Opt. Call Aaa 807,480
General Obligation Capital Improvement Bonds, Series 1991,
7.000%, 1/01/11 (ETM)
5,000 Chicago Housing Authority, Illinois, Revenue Bonds, Capital 7/12 at 100.00 Aaa 5,582,450
Fund Program, Series 2001, 5.375%, 7/01/18 (Pre-refunded
7/01/12)
285 Chicago, Illinois, General Obligation Bonds, Series 2002A, 7/12 at 100.00 AA- 291,233
5.625%, 1/01/39 - AMBAC Insured
9,715 Chicago, Illinois, General Obligation Bonds, Series 2002A, 7/12 at 100.00 AA- (4) 10,910,625
5.625%, 1/01/39 (Pre-refunded 7/01/12) - AMBAC Insured
2,575 Chicago, Illinois, Second Lien Passenger Facility Charge 1/11 at 101.00 A1 2,457,451
Revenue Bonds, O'Hare International Airport, Series 2001C,
5.100%, 1/01/26 - AMBAC Insured (Alternative Minimum Tax)
3,020 Cook County High School District 209, Proviso Township, 12/16 at 100.00 AAA 3,291,528
Illinois, General Obligation Bonds, Series 2004, 5.000%,
12/01/19 - FSA Insured
385 DuPage County Community School District 200, Wheaton, Illinois, 11/13 at 100.00 Aa3 422,472
General Obligation Bonds, Series 2003B, 5.250%, 11/01/20 -
FSA Insured
1,615 DuPage County Community School District 200, Wheaton, Illinois, 11/13 at 100.00 Aa3 (4) 1,836,481
General Obligation Bonds, Series 2003B, 5.250%, 11/01/20
(Pre-refunded 11/01/13) - FSA Insured
Nuveen Investments 17
NUV | Nuveen Municipal Value Fund, Inc. (continued)
| Portfolio of Investments October 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS (continued)
$ 5,000 Illinois Development Finance Authority, Gas Supply Revenue 11/13 at 101.00 A2 $ 4,937,300
Bonds, Peoples Gas, Light and Coke Company, Series 2003E,
4.875%, 11/01/38 (Mandatory put 11/01/18) - AMBAC Insured
(Alternative Minimum Tax)
28,030 Illinois Development Finance Authority, Local Government No Opt. Call Aa3 19,129,914
Program Revenue Bonds, Kane, Cook and DuPage Counties
School District U46 - Elgin, Series 2002, 0.000%,
1/01/19 - FSA Insured
1,800 Illinois Development Finance Authority, Local Government No Opt. Call Aa3 1,214,370
Program Revenue Bonds, Winnebago and Boone Counties School
District 205 - Rockford, Series 2000, 0.000%, 2/01/19 -
FSA Insured
3,180 Illinois Development Finance Authority, Revenue Bonds, 12/12 at 100.00 N/R (4) 3,636,712
Chicago Charter School Foundation, Series 2002A, 6.250%,
12/01/32 (Pre-refunded 12/01/12)
1,450 Illinois Development Finance Authority, Revenue Bonds, 9/11 at 100.00 BBB+ 1,345,238
Illinois Wesleyan University, Series 2001, 5.125%,
9/01/35 - AMBAC Insured
6,550 Illinois Development Finance Authority, Revenue Bonds, 9/11 at 100.00 BBB+ (4) 7,027,037
Illinois Wesleyan University, Series 2001, 5.125%, 9/01/35
(Pre-refunded 9/01/11) - AMBAC Insured
5,245 Illinois Finance Authority, Revenue Bonds, Loyola University 7/17 at 100.00 Aa1 5,387,716
of Chicago, Tender Option Bond Trust 1137, 9.072%, 7/01/46
(IF)
5,000 Illinois Finance Authority, Revenue Bonds, Northwestern 8/14 at 100.00 N/R (4) 5,791,450
Memorial Hospital, Series 2004A, 5.500%, 8/15/43
(Pre-refunded 8/15/14)
4,800 Illinois Finance Authority, Revenue Bonds, Provena Health, 8/19 at 100.00 BBB+ 5,399,424
Series 2009A, 7.750%, 8/15/34
3,975 Illinois Finance Authority, Revenue Bonds, Sherman Health 8/17 at 100.00 Baa1 3,637,602
Systems, Series 2007A, 5.500%, 8/01/37
15,000 Illinois Health Facilities Authority, Revenue Bonds, Condell 5/10 at 101.00 Aaa 15,637,950
Medical Center, Series 2000, 6.500%, 5/15/30 (Pre-refunded
5/15/10)
15,000 Illinois Health Facilities Authority, Revenue Bonds, Edward 2/11 at 101.00 AAA 16,011,450
Hospital Obligated Group, Series 2001B, 5.250%, 2/15/34
(Pre-refunded 2/15/11) - FSA Insured
8,145 Illinois Health Facilities Authority, Revenue Bonds, Sherman 2/10 at 100.00 Baa1 7,688,310
Health Systems, Series 1997, 5.250%, 8/01/22 - AMBAC
Insured
4,350 Illinois Health Facilities Authority, Revenue Bonds, South No Opt. Call A (4) 5,209,517
Suburban Hospital, Series 1992, 7.000%, 2/15/18 (ETM)
5,000 Illinois Sports Facility Authority, State Tax Supported 6/15 at 101.00 A 4,887,850
Bonds, Series 2001, 0.000%, 6/15/30 - AMBAC Insured
5,000 Lombard Public Facilities Corporation, Illinois, First Tier 1/16 at 100.00 B+ 3,263,300
Conference Center and Hotel Revenue Bonds, Series 2005A-2,
5.500%, 1/01/36 - ACA Insured
Metropolitan Pier and Exposition Authority, Illinois, Revenue
Bonds, McCormick Place Expansion Project, Series 1992A:
18,955 0.000%, 6/15/17 - FGIC Insured No Opt. Call A 13,837,340
12,830 0.000%, 6/15/18 - FGIC Insured No Opt. Call A 8,829,349
Metropolitan Pier and Exposition Authority, Illinois, Revenue
Bonds, McCormick Place Expansion Project, Series 1994B:
7,250 0.000%, 6/15/18 - NPFG Insured No Opt. Call AAA 4,989,305
3,385 0.000%, 6/15/21 - NPFG Insured No Opt. Call AAA 1,922,308
5,190 0.000%, 6/15/28 - NPFG Insured No Opt. Call AAA 1,909,920
11,610 0.000%, 6/15/29 - FGIC Insured No Opt. Call AAA 4,003,128
Metropolitan Pier and Exposition Authority, Illinois, Revenue
Bonds, McCormick Place Expansion Project, Series 2002A:
10,000 0.000%, 6/15/24 - NPFG Insured 6/22 at 101.00 AAA 7,661,300
21,375 0.000%, 6/15/34 - NPFG Insured No Opt. Call AAA 5,381,798
21,000 0.000%, 12/15/35 - NPFG Insured No Opt. Call AAA 4,861,290
21,070 0.000%, 6/15/36 - NPFG Insured No Opt. Call AAA 4,730,636
25,825 0.000%, 6/15/39 - NPFG Insured No Opt. Call AAA 4,871,628
8,460 5.250%, 6/15/42 - NPFG Insured 6/12 at 101.00 AAA 8,531,572
18 Nuveen Investments
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS (continued)
Metropolitan Pier and Exposition Authority, Illinois, Revenue
Refunding Bonds, McCormick Place Expansion Project, Series
1996A:
$ 16,700 0.000%, 12/15/21 - NPFG Insured No Opt. Call A $ 9,223,076
1,650 5.250%, 6/15/27 - AMBAC Insured 12/09 at 100.00 A2 1,650,710
Metropolitan Pier and Exposition Authority, Illinois, Revenue
Refunding Bonds, McCormick Place Expansion Project, Series
2002B:
3,775 0.000%, 6/15/20 - NPFG Insured 6/17 at 101.00 AAA 3,653,898
5,715 0.000%, 6/15/21 - NPFG Insured 6/17 at 101.00 AAA 5,504,231
1,000 Round Lake, Lake County, Illinois, Special Tax Bonds, Lakewood 3/17 at 100.00 AAA 952,270
Grove Special Service Area 4, Series 2007, 4.700%,
3/01/33 - AGC Insured
1,285 Tri-City Regional Port District, Illinois, Port and Terminal No Opt. Call N/R 953,046
Facilities Revenue Refunding Bonds, Delivery Network
Project, Series 2003A, 4.900%, 7/01/14 (Alternative Minimum
Tax)
1,575 Will County Community School District 161, Summit Hill, No Opt. Call N/R 1,052,951
Illinois, Capital Appreciation School Bonds, Series 1999,
0.000%, 1/01/18 - FGIC Insured
720 Will County Community School District 161, Summit Hill, No Opt. Call N/R (4) 539,244
Illinois, Capital Appreciation School Bonds, Series 1999,
0.000%, 1/01/18 - FGIC Insured (ETM)
------------------------------------------------------------------------------------------------------------------------------------
359,530 Total Illinois 240,838,786
------------------------------------------------------------------------------------------------------------------------------------
INDIANA - 1.7%
300 Anderson, Indiana, Economic Development Revenue Bonds, 4/14 at 100.00 N/R 272,058
Anderson University, Series 2007, 5.000%, 10/01/24
10,000 Indiana Bond Bank, State Revolving Fund Program Bonds, Series 2/13 at 101.00 AAA 10,863,300
2001A, 5.375%, 2/01/19
3,000 Indiana Health Facility Financing Authority, Hospital Revenue 3/14 at 100.00 A+ 2,941,890
Bonds, Deaconess Hospital Inc., Series 2004A, 5.375%,
3/01/34 - AMBAC Insured
4,450 Indiana Municipal Power Agency, Power Supply Revenue Bonds, 1/17 at 100.00 A+ 4,421,476
Series 2007A, 5.000%, 1/01/42 - NPFG Insured
Indianapolis Local Public Improvement Bond Bank, Indiana,
Series 1999E:
12,500 0.000%, 2/01/21 - AMBAC Insured No Opt. Call AA 7,638,625
14,595 0.000%, 2/01/27 - AMBAC Insured No Opt. Call AA 6,331,165
------------------------------------------------------------------------------------------------------------------------------------
44,845 Total Indiana 32,468,514
------------------------------------------------------------------------------------------------------------------------------------
IOWA - 1.2%
6,990 Iowa Finance Authority, Single Family Mortgage Revenue Bonds, 7/16 at 100.00 AAA 6,558,088
Series 2007B, 4.800%, 1/01/37 (Alternative Minimum Tax)
3,500 Iowa Higher Education Loan Authority, Private College Facility 10/12 at 100.00 N/R (4) 3,936,380
Revenue Bonds, Wartburg College, Series 2002, 5.500%,
10/01/33 (Pre-refunded 10/01/12) - ACA Insured
7,000 Iowa Tobacco Settlement Authority, Asset Backed Settlement 6/15 at 100.00 BBB 5,146,890
Revenue Bonds, Series 2005C, 5.625%, 6/01/46
6,160 Iowa Tobacco Settlement Authority, Tobacco Settlement 6/11 at 101.00 AAA 6,641,712
Asset-Backed Revenue Bonds, Series 2001B, 5.600%, 6/01/35
(Pre-refunded 6/01/11)
------------------------------------------------------------------------------------------------------------------------------------
23,650 Total Iowa 22,283,070
------------------------------------------------------------------------------------------------------------------------------------
KANSAS - 0.6%
10,000 Kansas Department of Transportation, Highway Revenue Bonds, 3/14 at 100.00 AAA 10,892,100
Series 2004A, 5.000%, 3/01/22
------------------------------------------------------------------------------------------------------------------------------------
KENTUCKY - 0.1%
1,085 Greater Kentucky Housing Assistance Corporation, FHA-Insured 1/10 at 100.00 A 1,086,128
Section 8 Mortgage Revenue Refunding Bonds, Series 1997A,
6.100%, 1/01/24 - NPFG Insured
1,000 Kentucky Economic Development Finance Authority, Louisville 6/18 at 100.00 AAA 1,062,610
Arena Project Revenue Bonds, Louisville Arena Authority,
Inc., Series 2008A-1, 6.000%, 12/01/38 - AGC Insured
------------------------------------------------------------------------------------------------------------------------------------
2,085 Total Kentucky 2,148,738
------------------------------------------------------------------------------------------------------------------------------------
Nuveen Investments 19
NUV | Nuveen Municipal Value Fund, Inc. (continued)
| Portfolio of Investments October 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
LOUISIANA - 2.6%
$ 1,000 East Baton Rouge Parish, Louisiana, Revenue Refunding Bonds, 3/10 at 100.00 B2 $ 982,320
Georgia Pacific Corporation Project, Series 1998, 5.350%,
9/01/11 (Alternative Minimum Tax)
12,000 Louisiana Local Government Environmental Facilities & 11/17 at 100.00 BB 11,579,880
Community Development Authority, Revenue Bonds, Westlake
Chemical Corporation Project, Series 2007, 6.750%, 11/01/32
5,150 Louisiana Public Facilities Authority, Hospital Revenue 8/15 at 100.00 A+ 5,075,531
Bonds, Franciscan Missionaries of Our Lady Health System,
Series 2005A, 5.250%, 8/15/32
6,540 Louisiana Public Facilities Authority, Hospital Revenue 11/09 at 100.00 AAA 7,204,660
Refunding Bonds, Southern Baptist Hospital, Series 1986,
8.000%, 5/15/12 (ETM)
27,105 Tobacco Settlement Financing Corporation, Louisiana, Tobacco 5/11 at 101.00 BBB 24,531,378
Settlement Asset-Backed Bonds, Series 2001B, 5.875%,
5/15/39
------------------------------------------------------------------------------------------------------------------------------------
51,795 Total Louisiana 49,373,769
------------------------------------------------------------------------------------------------------------------------------------
MARYLAND - 0.4%
3,500 Maryland Energy Financing Administration, Revenue Bonds, AES 3/10 at 100.00 N/R 3,500,910
Warrior Run Project, Series 1995, 7.400%, 9/01/19
(Alternative Minimum Tax)
4,600 Maryland Health and Higher Educational Facilities Authority, 8/14 at 100.00 A2 4,684,778
Revenue Bonds, MedStar Health, Series 2004, 5.500%, 8/15/33
------------------------------------------------------------------------------------------------------------------------------------
8,100 Total Maryland 8,185,688
------------------------------------------------------------------------------------------------------------------------------------
MASSACHUSETTS - 4.7%
10,000 Massachusetts Bay Transportation Authority, Senior Sales Tax 7/12 at 100.00 AAA 11,057,900
Revenue Refunding Bonds, Series 2002A, 5.000%, 7/01/32
(Pre-refunded 7/01/12)
1,720 Massachusetts Development Finance Agency, Resource Recovery 12/09 at 101.00 BBB 1,636,976
Revenue Bonds, Ogden Haverhill Associates, Series 1998B,
5.100%, 12/01/12 (Alternative Minimum Tax)
4,340 Massachusetts Health and Educational Facilities Authority, 11/11 at 101.00 BBB- 3,642,215
Revenue Bonds, Cape Cod Health Care Inc., Series 2001C,
5.250%, 11/15/31 - RAAI Insured
500 Massachusetts Health and Educational Facilities Authority, 7/18 at 100.00 A3 454,360
Revenue Bonds, CareGroup Inc., Series 2008E-1, 5.125%,
7/01/38
2,000 Massachusetts Health and Educational Facilities Authority, 7/14 at 100.00 BB 1,704,480
Revenue Bonds, Northern Berkshire Community Services Inc.,
Series 2004A, 6.375%, 7/01/34
Massachusetts Health and Educational Facilities Authority,
Revenue Bonds, Northern Berkshire Community Services Inc.,
Series 2004B:
1,340 6.250%, 7/01/24 7/14 at 100.00 BB 1,188,526
1,000 6.375%, 7/01/34 7/14 at 100.00 BB 847,420
12,855 Massachusetts Housing Finance Agency, Housing Bonds, Series 12/18 at 100.00 AA- 12,908,477
2009F, 5.700%, 6/01/40
Massachusetts Turnpike Authority, Metropolitan Highway System
Revenue Bonds, Senior Series 1997A:
10,195 5.000%, 1/01/27 - NPFG Insured 1/10 at 100.00 A 10,147,797
22,440 5.000%, 1/01/37 - NPFG Insured 1/10 at 100.00 A 21,166,979
8,000 Massachusetts Turnpike Authority, Metropolitan Highway System 1/10 at 100.00 AA 7,799,040
Revenue Bonds, Subordinate Series 1997B, 5.125%, 1/01/37 -
NPFG Insured
10,260 Massachusetts Turnpike Authority, Metropolitan Highway System 1/10 at 100.00 AA 9,717,451
Revenue Bonds, Subordinate Series 1999A, 5.000%, 1/01/39 -
AMBAC Insured
1,750 Massachusetts Water Pollution Abatement Trust, Pooled Loan 8/10 at 101.00 AAA 1,834,280
Program Bonds, Series 2000-6, 5.500%, 8/01/30
(Pre-refunded 8/01/10)
4,250 Massachusetts Water Pollution Abatement Trust, Pooled Loan 8/10 at 101.00 AAA 4,376,310
Program Bonds, Series 2000-6, 5.500%, 8/01/30
------------------------------------------------------------------------------------------------------------------------------------
90,650 Total Massachusetts 88,482,211
------------------------------------------------------------------------------------------------------------------------------------
20 Nuveen Investments
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
MICHIGAN - 3.8%
$ 12,440 Detroit Local Development Finance Authority, Michigan, Tax 11/09 at 101.00 B- $ 4,960,077
Increment Bonds, Series 1998A, 5.500%, 5/01/21
5,000 Detroit Water Supply System, Michigan, Water Supply System 7/16 at 100.00 AAA 4,701,900
Revenue Bonds, Series 2006D, 4.625%, 7/01/32 - FSA Insured
8,000 Detroit, Michigan, Second Lien Sewerage Disposal System 7/15 at 100.00 A 7,339,680
Revenue Bonds, Series 2005A, 5.000%, 7/01/35 - NPFG Insured
5,240 Michigan Municipal Bond Authority, Clean Water Revolving Fund 10/12 at 100.00 AAA 5,581,753
Revenue Refunding Bonds, Series 2002, 5.250%, 10/01/19
Michigan Municipal Bond Authority, Public School Academy
Revenue Bonds, Detroit Academy of Arts and Sciences Charter
School, Series 2001A:
900 7.500%, 10/01/12 10/11 at 100.00 Ba1 910,278
5,000 7.900%, 10/01/21 4/10 at 102.00 Ba1 4,857,250
3,500 8.000%, 10/01/31 4/10 at 102.00 Ba1 3,293,990
22,235 Michigan State Hospital Finance Authority, Hospital Revenue 2/10 at 100.00 BB- 17,159,861
Bonds, Detroit Medical Center Obligated Group, Series
1998A, 5.250%, 8/15/28
Michigan State Hospital Finance Authority, Revenue Refunding
Bonds, Detroit Medical Center Obligated Group, Series 1993A:
1,100 6.250%, 8/15/13 2/10 at 100.00 BB- 1,099,956
12,925 6.500%, 8/15/18 2/10 at 100.00 BB- 12,636,514
7,200 Michigan Strategic Fund, Limited Obligation Resource Recovery 12/12 at 100.00 Baa1 7,076,520
Revenue Refunding Bonds, Detroit Edison Company, Series
2002D, 5.250%, 12/15/32 - SYNCORA GTY Insured
1,150 Royal Oak Hospital Finance Authority, Michigan, Hospital 9/18 at 100.00 A1 1,339,923
Revenue Bonds, William Beaumont Hospital, Refunding Series
2009V, 8.250%, 9/01/39
------------------------------------------------------------------------------------------------------------------------------------
84,690 Total Michigan 70,957,702
------------------------------------------------------------------------------------------------------------------------------------
MINNESOTA - 0.6%
1,750 Breckenridge, Minnesota, Revenue Bonds, Catholic Health 5/14 at 100.00 AA 1,768,953
Initiatives, Series 2004A, 5.000%, 5/01/30
6,375 Minneapolis Health Care System, Minnesota, Revenue Bonds, 11/18 at 100.00 A 7,195,208
Fairview Hospital and Healthcare Services, Series 2008A,
6.625%, 11/15/28
355 Minnesota Housing Finance Agency, Rental Housing Bonds, Series 2/10 at 100.00 AA+ 356,491
1995D, 5.900%, 8/01/15 - NPFG Insured
2,000 Saint Paul Housing and Redevelopment Authority, Minnesota, 11/16 at 100.00 Baa1 1,802,000
Health Care Facilities Revenue Bonds, HealthPartners
Obligated Group, Series 2006, 5.250%, 5/15/36
------------------------------------------------------------------------------------------------------------------------------------
10,480 Total Minnesota 11,122,652
------------------------------------------------------------------------------------------------------------------------------------
MISSOURI - 2.9%
40,000 Missouri Health and Educational Facilities Authority, Revenue 5/13 at 100.00 Aa2 40,384,400
Bonds, BJC Health System, Series 2003, 5.250%, 5/15/32 (UB)
6,000 Missouri-Illinois Metropolitan District Bi-State Development 10/13 at 100.00 AAA 6,027,300
Agency, Mass Transit Sales Tax Appropriation Bonds,
Metrolink Cross County Extension Project, Series 2002B,
5.000%, 10/01/32 - FSA Insured
4,000 Sugar Creek, Missouri, Industrial Development Revenue Bonds, 6/13 at 101.00 BBB- 3,233,880
Lafarge North America Inc., Series 2003A, 5.650%, 6/01/37
(Alternative Minimum Tax)
West Plains Industrial Development Authority, Missouri,
Hospital Facilities Revenue Bonds, Ozark Medical Center,
Series 1997:
1,105 5.500%, 11/15/12 11/09 at 100.00 B+ 1,105,155
1,000 5.600%, 11/15/17 11/09 at 100.00 B+ 937,500
3,075 West Plains Industrial Development Authority, Missouri, 11/09 at 101.00 B+ 2,882,075
Hospital Facilities Revenue Bonds, Ozark Medical Center,
Series 1999, 6.750%, 11/15/24
------------------------------------------------------------------------------------------------------------------------------------
55,180 Total Missouri 54,570,310
------------------------------------------------------------------------------------------------------------------------------------
Nuveen Investments 21
NUV | Nuveen Municipal Value Fund, Inc. (continued)
| Portfolio of Investments October 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
MONTANA - 0.2%
$ 3,750 Forsyth, Rosebud County, Montana, Pollution Control Revenue 3/13 at 101.00 A- $ 3,498,113
Refunding Bonds, Puget Sound Energy, Series 2003A, 5.000%,
3/01/31 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
NEBRASKA - 0.3%
5,000 Omaha Public Power District, Nebraska, Electric System Revenue 2/18 at 100.00 Aa1 5,312,800
Bonds, Series 2008A, 5.500%, 2/01/39
------------------------------------------------------------------------------------------------------------------------------------
NEVADA - 0.7%
2,500 Carson City, Nevada, Hospital Revenue Bonds, Carson-Tahoe 9/13 at 100.00 BBB 2,240,050
Hospital, Series 2003A, 5.125%, 9/01/29 - RAAI Insured
Director of Nevada State Department of Business and Industry,
Revenue Bonds, Las Vegas Monorail Project, First Tier,
Series 2000:
15,095 0.000%, 1/01/24 - AMBAC Insured No Opt. Call Caa2 1,234,167
11,000 0.000%, 1/01/25 - AMBAC Insured No Opt. Call Caa2 867,790
4,000 5.625%, 1/01/32 - AMBAC Insured 1/10 at 102.00 Caa2 820,040
22,010 5.375%, 1/01/40 - AMBAC Insured 1/10 at 100.00 Caa2 4,512,270
2,500 Reno, Neveda, Health Facility Revenue Bonds, Catholic 7/17 at 100.00 AAA 2,688,850
Healthcare West, Trust 2634, 18.374%, 7/01/31 - BHAC
Insured (IF)
1,500 Sparks Tourism Improvement District 1, Legends at Sparks 6/18 at 100.00 Ba2 1,455,075
Marina, Nevada, Senior Sales Tax Revenue Bonds Series
2008A, 6.750%, 6/15/28
------------------------------------------------------------------------------------------------------------------------------------
58,605 Total Nevada 13,818,242
------------------------------------------------------------------------------------------------------------------------------------
NEW JERSEY - 5.7%
23,625 New Jersey Economic Development Authority, Special Facilities 3/10 at 101.00 B 20,314,193
Revenue Bonds, Continental Airlines Inc., Series 1999,
6.250%, 9/15/29 (Alternative Minimum Tax)
9,000 New Jersey Economic Development Authority, Special Facilities 11/10 at 101.00 B 8,410,140
Revenue Bonds, Continental Airlines Inc., Series 2000,
7.000%, 11/15/30 (Alternative Minimum Tax)
4,740 New Jersey Health Care Facilities Financing Authority, Revenue 1/17 at 41.49 BB+ 640,564
Bonds, Saint Barnabas Health Care System, Series 2006A,
0.000%, 7/01/34
11,200 New Jersey Health Care Facilities Financing Authority, Revenue 7/10 at 101.00 BBB- (4) 11,833,696
Bonds, Trinitas Hospital Obligated Group, Series 2000,
7.500%, 7/01/30 (Pre-refunded 7/01/10)
7,500 New Jersey Transportation Trust Fund Authority, Transportation 6/13 at 100.00 AAA 8,577,300
System Bonds, Series 2003C, 5.500%, 6/15/24 (Pre-refunded
6/15/13)
New Jersey Transportation Trust Fund Authority, Transportation
System Bonds, Series 2006C:
30,000 0.000%, 12/15/31 - FGIC Insured No Opt. Call AA- 7,654,200
27,000 0.000%, 12/15/32 - FSA Insured No Opt. Call AAA 7,121,520
310 New Jersey Turnpike Authority, Revenue Bonds, Series 1991C, No Opt. Call A+ 367,226
6.500%, 1/01/16 - NPFG Insured
New Jersey Turnpike Authority, Revenue Bonds, Series 1991C:
105 6.500%, 1/01/16 - NPFG Insured (ETM) No Opt. Call A+ (4) 129,241
1,490 6.500%, 1/01/16 - NPFG Insured (ETM) No Opt. Call A+ (4) 1,734,032
27,185 Tobacco Settlement Financing Corporation, New Jersey, Tobacco 6/12 at 100.00 AAA 30,686,423
Settlement Asset-Backed Bonds, Series 2002, 6.125%, 6/01/42
(Pre-refunded 6/01/12)
7,165 Tobacco Settlement Financing Corporation, New Jersey, Tobacco 6/13 at 100.00 AAA 8,352,885
Settlement Asset-Backed Bonds, Series 2003, 6.250%, 6/01/43
(Pre-refunded 6/01/13)
------------------------------------------------------------------------------------------------------------------------------------
149,320 Total New Jersey 105,821,420
------------------------------------------------------------------------------------------------------------------------------------
NEW MEXICO - 0.6%
1,500 University of New Mexico, Revenue Refunding Bonds, Series No Opt. Call AA 1,739,040
1992A, 6.000%, 6/01/21
9,600 University of New Mexico, Subordinate Lien Revenue Refunding 6/12 at 100.00 AA 9,662,016
and Improvement Bonds, Series 2002A, 5.000%, 6/01/32
------------------------------------------------------------------------------------------------------------------------------------
11,100 Total New Mexico 11,401,056
------------------------------------------------------------------------------------------------------------------------------------
22 Nuveen Investments
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK - 7.9%
$ 8,500 Dormitory Authority of the State of New York, FHA-Insured 2/14 at 100.00 AAA $ 8,774,125
Mortgage Revenue Bonds, Kaleida Health, Series 2004,
5.050%, 2/15/25
5,200 Dormitory Authority of the State of New York, New York City, 5/10 at 101.00 AA- (4) 5,411,744
Lease Revenue Bonds, Court Facilities, Series 1999, 6.000%,
5/15/39 (Pre-refunded 5/15/10)
2,500 Dormitory Authority of the State of New York, Revenue Bonds, 1/10 at 100.00 A2 2,501,250
Mount Sinai NYU Health Obligated Group, Series 2000A,
5.500%, 7/01/26
2,625 Dormitory Authority of the State of New York, Revenue Bonds, 1/10 at 100.00 A2 2,626,313
Mount Sinai NYU Health, Series 2000C, 5.500%, 7/01/26
15,500 Long Island Power Authority, New York, Electric System General 9/11 at 100.00 AAA 16,840,750
Revenue Bonds, Series 2001A, 5.375%, 9/01/25 (Pre-refunded
9/01/11)
2,000 Long Island Power Authority, New York, Electric System General 6/16 at 100.00 A- 2,023,400
Revenue Bonds, Series 2006B, 5.000%, 12/01/35
1,510 New York City Industrial Development Agency, New York, Civic 12/16 at 100.00 BB+ 1,106,860
Facility Revenue Bonds, Vaughn College of Aeronautics,
Series 2006B, 5.000%, 12/01/31
10,000 New York City Industrial Development Agency, New York, Special 8/12 at 101.00 B- 10,180,600
Facilities Revenue Bonds, JFK Airport - American Airlines
Inc., Series 2002B, 8.500%, 8/01/28 (Alternative Minimum
Tax)
5,500 New York City Municipal Water Finance Authority, New York, 12/14 at 100.00 AAA 5,599,165
Water and Sewerage System Revenue Bonds, Series 2004B,
5.000%, 6/15/36 - FSA Insured (UB)
5 New York City, New York, General Obligation Bonds, Fiscal 2/10 at 100.00 AA 5,022
Series 1997E, 6.000%, 8/01/16
3,880 New York City, New York, General Obligation Bonds, Fiscal 2/10 at 100.00 AA 3,895,016
Series 1998D, 5.500%, 8/01/10
New York City, New York, General Obligation Bonds, Fiscal
Series 2003J:
1,450 5.500%, 6/01/21 6/13 at 100.00 AAA 1,520,601
385 5.500%, 6/01/22 6/13 at 100.00 AAA 402,398
New York City, New York, General Obligation Bonds, Fiscal
Series 2004C:
8,000 5.250%, 8/15/24 8/14 at 100.00 AA 8,346,560
6,000 5.250%, 8/15/25 8/14 at 100.00 AA 6,249,360
10,000 New York Dorm Authority, FHA Insured Mortgage Hospital Revenue 8/16 at 100.00 BB+ 9,247,300
Bonds, Kaleida Health, Series 2006, 4.700%, 2/15/35
New York State Tobacco Settlement Financing Corporation,
Tobacco Settlement Asset-Backed and State Contingency
Contract-Backed Bonds, Series 2003A-1:
10,000 5.500%, 6/01/17 6/11 at 100.00 AA- 10,332,600
11,190 5.500%, 6/01/18 6/12 at 100.00 AA- 11,731,596
28,810 5.500%, 6/01/19 6/13 at 100.00 AA- 30,578,356
2,500 Port Authority of New York and New Jersey, Special Project No Opt. Call A 2,564,725
Bonds, JFK International Air Terminal LLC, Sixth Series
1997, 6.250%, 12/01/10 - NPFG Insured (Alternative Minimum
Tax)
8,500 Power Authority of the State of New York, General Revenue 11/10 at 100.00 Aa2 8,553,890
Bonds, Series 2000A, 5.250%, 11/15/40
------------------------------------------------------------------------------------------------------------------------------------
144,055 Total New York 148,491,631
------------------------------------------------------------------------------------------------------------------------------------
NORTH CAROLINA - 1.1%
1,500 Charlotte, North Carolina, Certificates of Participation, 6/13 at 100.00 AA+ 1,518,090
Governmental Facilities Projects, Series 2003G, 5.000%,
6/01/33
2,500 North Carolina Eastern Municipal Power Agency, Power System 1/13 at 100.00 A- 2,523,450
Revenue Refunding Bonds, Series 2003D, 5.125%, 1/01/26
1,500 North Carolina Infrastructure Finance Corporation, 2/14 at 100.00 AA+ 1,586,535
Certificates of Participation, Correctional Facilities,
Series 2004A, 5.000%, 2/01/20
2,000 North Carolina Medical Care Commission, Health System Revenue 10/17 at 100.00 AA 1,893,160
Bonds, Mission St. Joseph's Health System, Series 2007,
4.500%, 10/01/31
10,000 North Carolina Municipal Power Agency 1, Catawba Electric 1/10 at 101.00 A 10,201,000
Revenue Bonds, Series 1999B, 6.500%, 1/01/20
3,000 The Charlotte-Mecklenberg Hospital Authority, North Carolina, 1/18 at 100.00 AA- 2,891,910
Doing Business as Carolinas HealthCare System, Health Care
Refunding Revenue Bonds, Series 2008A, 5.000%, 1/15/47
------------------------------------------------------------------------------------------------------------------------------------
20,500 Total North Carolina 20,614,145
------------------------------------------------------------------------------------------------------------------------------------
Nuveen Investments 23
NUV | Nuveen Municipal Value Fund, Inc. (continued)
| Portfolio of Investments October 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
OHIO - 2.3%
$ 10,000 American Municipal Power Ohio Inc., General Revenue Bonds, 2/18 at 100.00 A1 $ 10,048,600
Series 2008, 5.250%, 2/15/43
Buckeye Tobacco Settlement Financing Authority, Ohio, Tobacco
Settlement Asset-Backed Revenue Bonds, Senior Lien, Series
2007A-2:
480 5.125%, 6/01/24 6/17 at 100.00 BBB 427,517
2,885 5.375%, 6/01/24 6/17 at 100.00 BBB 2,637,784
5,500 5.875%, 6/01/30 6/17 at 100.00 BBB 4,787,035
15,165 5.750%, 6/01/34 6/17 at 100.00 BBB 12,753,007
11,785 5.875%, 6/01/47 6/17 at 100.00 BBB 8,731,742
5,150 Buckeye Tobacco Settlement Financing Authority, Ohio, Tobacco 6/22 at 100.00 BBB 3,378,143
Settlement Asset-Backed Revenue Bonds, Senior Lien, Series
2007A-3, 0.000%, 6/01/37
------------------------------------------------------------------------------------------------------------------------------------
50,965 Total Ohio 42,763,828
------------------------------------------------------------------------------------------------------------------------------------
OKLAHOMA - 0.8%
9,955 Oklahoma Development Finance Authority, Revenue Bonds, St. 2/14 at 100.00 A 9,896,763
John Health System, Series 2004, 5.125%, 2/15/31
5,045 Oklahoma Development Finance Authority, Revenue Bonds, St. 2/14 at 100.00 AAA 5,738,032
John Health System, Series 2004, 5.125%, 2/15/31
(Pre-refunded 2/15/14)
------------------------------------------------------------------------------------------------------------------------------------
15,000 Total Oklahoma 15,634,795
------------------------------------------------------------------------------------------------------------------------------------
OREGON - 0.3%
2,600 Clackamas County Hospital Facility Authority, Oregon, Revenue 5/11 at 101.00 A+ 2,664,558
Refunding Bonds, Legacy Health System, Series 2001, 5.250%,
5/01/21
2,860 Oregon State Facilities Authority, Revenue Bonds, Willamette 10/17 at 100.00 A 2,721,319
University, Series 2007A, 5.000%, 10/01/32
------------------------------------------------------------------------------------------------------------------------------------
5,460 Total Oregon 5,385,877
------------------------------------------------------------------------------------------------------------------------------------
PENNSYLVANIA - 1.9%
10,300 Allegheny County Hospital Development Authority, Pennsylvania, 11/17 at 100.00 BB 8,205,804
Revenue Bonds, West Penn Allegheny Health System, Series
2007A, 5.000%, 11/15/28
6,500 Pennsylvania Turnpike Commission, Turnpike Revenue Bonds, 12/14 at 100.00 Aa3 6,670,430
Series 2004A, 5.500%, 12/01/31 - AMBAC Insured
8,000 Philadelphia School District, Pennsylvania, General Obligation 6/14 at 100.00 Aa3 (4) 9,181,760
Bonds, Series 2004D, 5.125%, 6/01/34 (Pre-refunded
6/01/14) - FGIC Insured
10,075 State Public School Building Authority, Pennsylvania, Lease 6/13 at 100.00 AAA 11,341,025
Revenue Bonds, Philadelphia School District, Series 2003,
5.000%, 6/01/33 (Pre-refunded 6/01/13) - FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
34,875 Total Pennsylvania 35,399,019
------------------------------------------------------------------------------------------------------------------------------------
PUERTO RICO - 2.6%
8,340 Puerto Rico Aqueduct and Sewerage Authority, Revenue Bonds, 7/18 at 100.00 BBB- 8,525,648
Senior Lien Series 2008A, 6.000%, 7/01/44
13,000 Puerto Rico Highway and Transportation Authority, Highway No Opt. Call BBB 12,326,340
Revenue Bonds, Series 2007N, 5.250%, 7/01/39 - FGIC Insured
5,450 Puerto Rico Industrial, Tourist, Educational, Medical and 6/10 at 101.00 Baa3 5,507,062
Environmental Control Facilities Financing Authority,
Co-Generation Facility Revenue Bonds, Series 2000A, 6.625%,
6/01/26 (Alternative Minimum Tax)
4,345 Puerto Rico Infrastructure Financing Authority, Special 10/10 at 101.00 AAA 4,596,662
Obligation Bonds, Series 2000A, 5.500%, 10/01/40
11,000 Puerto Rico Sales Tax Financing Corporation, Sales Tax Revenue 8/26 at 100.00 A+ 8,110,630
Bonds, First Subordinate Series 2009A, 0.000%, 8/01/32
70,300 Puerto Rico Sales Tax Financing Corporation, Sales Tax Revenue No Opt. Call AA- 4,300,251
Bonds, Series 2007A, 0.000%, 8/01/54 - AMBAC Insured
5,000 Puerto Rico, General Obligation Bonds, Series 2000B, 5.625%, 7/10 at 100.00 A 5,021,250
7/01/19 - NPFG Insured
------------------------------------------------------------------------------------------------------------------------------------
117,435 Total Puerto Rico 48,387,843
------------------------------------------------------------------------------------------------------------------------------------
24 Nuveen Investments
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
RHODE ISLAND - 1.1%
$ 6,250 Rhode Island Health and Educational Building Corporation, 11/09 at 100.00 A $ 6,128,063
Hospital Financing Revenue Bonds, Lifespan Obligated
Group, Series 1996, 5.250%, 5/15/26 - NPFG Insured
16,070 Rhode Island Tobacco Settlement Financing Corporation, 6/12 at 100.00 BBB 14,605,862
Tobacco Settlement Asset-Backed Bonds, Series 2002A,
6.250%, 6/01/42
------------------------------------------------------------------------------------------------------------------------------------
22,320 Total Rhode Island 20,733,925
------------------------------------------------------------------------------------------------------------------------------------
SOUTH CAROLINA - 3.0%
7,000 Dorchester County School District 2, South Carolina, 12/14 at 100.00 AA- 7,143,500
Installment Purchase Revenue Bonds, GROWTH, Series 2004,
5.250%, 12/01/29
3,000 Myrtle Beach, South Carolina, Hospitality and Accommodation 6/14 at 100.00 A+ 2,855,910
Fee Revenue Bonds, Series 2004A, 5.000%, 6/01/36 - FGIC
Insured
11,550 Piedmont Municipal Power Agency, South Carolina, Electric No Opt. Call AAA 4,211,708
Revenue Bonds, Series 2004A-2, 0.000%, 1/01/28 - AMBAC
Insured
8,475 Piedmont Municipal Power Agency, South Carolina, Electric 1/10 at 100.00 A- 8,421,014
Revenue Refunding Bonds, Series 1986, 5.000%, 1/01/25
4,320 South Carolina JOBS Economic Development Authority, Economic 11/12 at 100.00 A3 (4) 4,885,790
Development Revenue Bonds, Bon Secours Health System Inc.,
Series 2002A, 5.625%, 11/15/30 (Pre-refunded 11/15/12)
16,430 South Carolina JOBS Economic Development Authority, Economic 11/12 at 100.00 A- 16,554,868
Development Revenue Bonds, Bon Secours Health System Inc.,
Series 2002B, 5.625%, 11/15/30
8,000 South Carolina JOBS Economic Development Authority, Hospital 12/10 at 102.00 Baa2 (4) 8,674,480
Revenue Bonds, Palmetto Health Alliance, Series 2000A,
7.375%, 12/15/21 (Pre-refunded 12/15/10)
4,215 Spartanburg Sanitary Sewer District, South Carolina, Sewer 3/14 at 100.00 A 4,084,377
System Revenue Bonds, Series 2003B, 5.000%, 3/01/38 - NPFG
Insured
------------------------------------------------------------------------------------------------------------------------------------
62,990 Total South Carolina 56,831,647
------------------------------------------------------------------------------------------------------------------------------------
TENNESSEE - 1.1%
10,300 Jackson, Tennessee, Hospital Revenue Refunding Bonds, 4/18 at 100.00 A+ 10,566,667
Jackson-Madison County General Hospital Project, Series
2008, 5.625%, 4/01/38
Knox County Health, Educational and Housing Facilities Board,
Tennessee, Hospital Revenue Bonds, Baptist Health System
of East Tennessee Inc., Series 2002:
3,000 6.375%, 4/15/22 4/12 at 101.00 A1 3,100,410
2,605 6.500%, 4/15/31 4/12 at 101.00 A1 2,665,410
2,000 Sullivan County Health Educational and Housing Facilities 3/13 at 100.00 N/R 1,719,860
Board, Tennessee, Revenue Bonds, Wellmont Health System,
Refunding Series 200A, 0.000%, 9/01/32
3,000 Sullivan County Health Educational and Housing Facilities 9/16 at 100.00 BBB+ 2,509,890
Board, Tennessee, Revenue Bonds, Wellmont Health System,
Series 2006C, 5.250%, 9/01/36
------------------------------------------------------------------------------------------------------------------------------------
20,905 Total Tennessee 20,562,237
------------------------------------------------------------------------------------------------------------------------------------
TEXAS - 7.4%
5,000 Alliance Airport Authority, Texas, Special Facilities Revenue 12/12 at 100.00 CCC+ 2,988,250
Bonds, American Airlines Inc., Series 2007, 5.250%,
12/01/29 (Alternative Minimum Tax)
2,000 Austin Convention Enterprises Inc., Texas, Convention Center 1/17 at 100.00 BB 1,540,880
Hotel Revenue Bonds, First Tier Series 2006B, 5.750%,
1/01/34
5,110 Brazos River Authority, Texas, Pollution Control Revenue 4/13 at 101.00 Caa3 2,983,269
Refunding Bonds, TXU Electric Company, Series 1999C,
7.700%, 3/01/32 (Alternative Minimum Tax)
Central Texas Regional Mobility Authority, Travis and
Williamson Counties, Toll Road Revenue Bonds, Series 2005:
4,000 5.000%, 1/01/35 - FGIC Insured 1/15 at 100.00 A 3,451,080
31,550 5.000%, 1/01/45 - FGIC Insured 1/15 at 100.00 A 26,906,154
11,000 Harris County-Houston Sports Authority, Texas, Junior Lien No Opt. Call A 3,223,660
Revenue Bonds, Series 2001H, 0.000%, 11/15/27 - NPFG
Insured
Nuveen Investments 25
NUV | Nuveen Municipal Value Fund, Inc. (continued)
| Portfolio of Investments October 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
TEXAS (continued)
$ 2,950 Harris County-Houston Sports Authority, Texas, Senior Lien 11/11 at 100.00 A $ 2,700,607
Revenue Bonds, Series 2001G, 5.250%, 11/15/30 - NPFG
Insured
13,270 Harris County-Houston Sports Authority, Texas, Third Lien 11/24 at 59.10 A 2,389,396
Revenue Bonds, Series 2004-A3., 0.000%, 11/15/33 - NPFG
Insured
24,660 Houston, Texas, Hotel Occupancy Tax and Special Revenue No Opt. Call A- 7,232,778
Bonds, Convention and Entertainment Project, Series 2001B,
0.000%, 9/01/29 - AMBAC Insured
10,045 Houston, Texas, Subordinate Lien Airport System Revenue 7/10 at 100.00 AAA 10,250,018
Bonds, Series 2000A, 5.875%, 7/01/16 - FSA Insured
(Alternative Minimum Tax)
3,470 Irving Independent School District, Texas, Unlimited Tax No Opt. Call AAA 3,433,079
School Building Bonds, Series 1997, 0.000%, 2/15/11
5,000 Kerrville Health Facilities Development Corporation, Texas, No Opt. Call BBB- 4,431,000
Revenue Bonds, Sid Peterson Memorial Hospital Project,
Series 2005, 5.375%, 8/15/35
22,060 Leander Independent School District, Williamson and Travis 2/10 at 32.48 AAA 7,041,111
Counties, Texas, Unlimited Tax School Building and
Refunding Bonds, Series 2000, 0.000%, 8/15/27
North Texas Thruway Authority, First Tier System Revenue
Refunding Bonds, Capital Appreciation Series 2008I:
30,000 0.000%, 1/01/42 - AGC Insured 1/25 at 100.00 AAA 22,403,400
5,220 0.000%, 1/01/43 1/25 at 100.00 A2 3,839,362
15,450 North Texas Thruway Authority, First Tier System Revenue No Opt. Call AAA 3,247,281
Refunding Bonds, Capital Appreciation Series 2008, 0.000%,
1/01/36 - AGC Insured
5,000 Port Corpus Christi Industrial Development Corporation, 4/10 at 100.00 BBB 4,955,450
Texas, Revenue Refunding Bonds, Valero Refining and
Marketing Company, Series 1997A, 5.400%, 4/01/18
5,000 Richardson Hospital Authority, Texas, Revenue Bonds, 12/13 at 100.00 Baa2 4,412,500
Richardson Regional Medical Center, Series 2004, 6.000%,
12/01/34
2,000 Sabine River Authority, Texas, Pollution Control Revenue 7/13 at 101.00 CCC 1,001,120
Refunding Bonds, TXU Electric Company, Series 2003A,
5.800%, 7/01/22
3,000 San Antonio, Texas, Water System Revenue Bonds, Series 2005, 5/15 at 100.00 AA 2,981,700
4.750%, 5/15/37 - NPFG Insured
11,585 Tarrant County Cultural & Educational Facilities Financing 2/17 at 100.00 AA- 10,763,044
Corporation, Texas, Revenue Bonds, Series 2007, Trust
1201, 9.088%, 2/15/36 (IF)
5,000 Tarrant County Cultural Education Facilities Finance 1/19 at 100.00 AAA 5,507,150
Corporation, Texas, Revenue Refunding Bonds, Christus
Health, Series 2008, 6.500%, 7/01/37
------------------------------------------------------------------------------------------------------------------------------------
222,370 Total Texas 137,682,289
------------------------------------------------------------------------------------------------------------------------------------
UTAH - 0.4%
3,260 Eagle Mountain, Utah, Gas and Electric Revenue Bonds, Series 6/15 at 100.00 BBB- 3,151,703
2005, 5.000%, 6/01/24 - RAAI Insured
655 Utah Housing Finance Agency, Single Family Mortgage Bonds, 1/10 at 101.50 AAA 655,747
Series 1998G-2, Class I, 5.200%, 7/01/30 (Alternative
Minimum Tax)
3,700 Utah State Board of Regents, Utah State University, Revenue 4/14 at 100.00 AA (4) 4,158,023
Bonds, Series 2004, 5.000%, 4/01/35 (Pre-refunded
4/01/14) - NPFG Insured
------------------------------------------------------------------------------------------------------------------------------------
7,615 Total Utah 7,965,473
------------------------------------------------------------------------------------------------------------------------------------
VIRGIN ISLANDS - 0.1%
2,500 Virgin Islands Public Finance Authority, Revenue Bonds, 1/14 at 100.00 BBB 2,545,175
Refinery Project - Hovensa LLC, Series 2003, 6.125%,
7/01/22 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
VIRGINIA - 0.4%
3,000 Fairfax County Economic Development Authority, Virginia, 10/17 at 100.00 N/R 2,553,060
Residential Care Facilities Mortgage Revenue Bonds,
Goodwin House, Inc., Series 2007A, 5.125%, 10/01/42
4,125 Metropolitan Washington D.C. Airports Authority, Airport 10/12 at 100.00 AA- 4,333,725
System Revenue Bonds, Series 2002A, 5.750%, 10/01/16 -
FGIC Insured (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
7,125 Total Virginia 6,886,785
------------------------------------------------------------------------------------------------------------------------------------
26 Nuveen Investments
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
WASHINGTON - 4.1%
$ 6,400 Cowlitz County Public Utilities District 1, Washington, 9/14 at 100.00 A $ 6,292,288
Electric Production Revenue Bonds, Series 2004, 5.000%,
9/01/34 - FGIC Insured
12,500 Energy Northwest, Washington, Electric Revenue Refunding 7/12 at 100.00 Aaa 13,813,625
Bonds, Columbia Generating Station - Nuclear Project 2,
Series 2002B, 6.000%, 7/01/18 - AMBAC Insured
4,000 Energy Northwest, Washington, Electric Revenue Refunding 7/13 at 100.00 Aaa 4,457,520
Bonds, Nuclear Project 3, Series 2003A, 5.500%, 7/01/17 -
SYNCORA GTY Insured
8,200 Washington Public Power Supply System, Revenue Refunding No Opt. Call Aaa 7,274,958
Bonds, Nuclear Project 3, Series 1989B, 0.000%, 7/01/14
2,500 Washington State Health Care Facilities Authority, Revenue No Opt. Call N/R 2,000,225
Bonds, Northwest Hospital and Medical Center of Seattle,
Series 2007, 5.700%, 12/01/32
5,000 Washington State Healthcare Facilities Authority, Revenue 10/16 at 100.00 AA 4,775,500
Bonds, Providence Health Care Services, Series 2006A,
4.625%, 10/01/34 - FGIC Insured
2,875 Washington State Healthcare Facilities Authority, Revenue 8/17 at 100.00 A 2,652,303
Bonds, Virginia Mason Medical Center, Series 2007B,
5.000%, 2/15/27 - NPFG Insured
7,910 Washington State Housing Finance Commission, Single Family 12/15 at 100.00 Aaa 7,665,977
Program Bonds, 2006 Series 3A, 5.000%, 12/01/37
(Alternative Minimum Tax)
19,130 Washington State Tobacco Settlement Authority, Tobacco 6/13 at 100.00 BBB 18,831,572
Settlement Asset-Backed Revenue Bonds, Series 2002,
6.625%, 6/01/32
Washington State, Motor Vehicle Fuel Tax General Obligation
Bonds, Series 2002-03C:
9,000 0.000%, 6/01/29 - NPFG Insured No Opt. Call AA+ 3,522,600
16,195 0.000%, 6/01/30 - NPFG Insured No Opt. Call AA+ 5,925,751
------------------------------------------------------------------------------------------------------------------------------------
93,710 Total Washington 77,212,319
------------------------------------------------------------------------------------------------------------------------------------
WISCONSIN - 2.0%
Badger Tobacco Asset Securitization Corporation, Wisconsin,
Tobacco Settlement Asset-Backed Bonds, Series 2002:
5,360 6.125%, 6/01/27 (Pre-refunded 6/01/12) 6/12 at 100.00 AAA 5,856,926
14,750 6.375%, 6/01/32 (Pre-refunded 6/01/12) 6/12 at 100.00 AAA 16,546,255
6,000 Wisconsin Health and Educational Facilities Authority, 9/13 at 100.00 BBB+ (4) 6,921,720
Revenue Bonds, Franciscan Sisters of Christian Charity
Healthcare Ministry, Series 2003A, 5.875%, 9/01/33
(Pre-refunded 9/01/13)
1,000 Wisconsin Health and Educational Facilities Authority, 2/16 at 100.00 BBB+ 1,008,520
Revenue Bonds, Marshfield Clinic, Series 2006A, 5.000%,
2/15/17
3,750 Wisconsin Health and Educational Facilities Authority, 2/12 at 101.00 AAA 4,181,850
Revenue Bonds, Wheaton Franciscan Services Inc., Series
2002, 5.750%, 8/15/30 (Pre-refunded 2/15/12)
2,925 Wisconsin Housing and Economic Development Authority, Home 9/14 at 100.00 AA 2,698,751
Ownership Revenue Bonds, Series 2005C, 4.875%, 3/01/36
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
33,785 Total Wisconsin 37,214,022
------------------------------------------------------------------------------------------------------------------------------------
Nuveen Investments 27
NUV | Nuveen Municipal Value Fund, Inc. (continued)
| Portfolio of Investments October 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
WYOMING - 0.1%
$ 2,035 Campbell County, Wyoming Solid Waste Facilities Revenue 7/19 at 100.00 A+ $ 2,143,079
Bonds, Basin Electric Power Cooperative - Dry Fork Station
Facilities, Series 2009A, 5.750%, 7/15/39
------------------------------------------------------------------------------------------------------------------------------------
$ 2,408,459 Total Investments (cost $1,865,922,627) - 100.3% 1,877,149,851
===============---------------------------------------------------------------------------------------------------------------------
Floating Rate Obligations - (2.0)% (38,250,000)
------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 1.7% 33,131,484
------------------------------------------------------------------------------------------------------------------
Net Assets - 100% $ 1,872,031,335
==================================================================================================================
(1) All percentages shown in the Portfolio of Investments are based on net
assets.
(2) 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.
(3) Ratings (not covered by the report of independent registered public
accounting firm): Using the higher of Standard & Poor's Group ("Standard &
Poor's") or Moody's Investor Service, Inc. ("Moody's") rating. Ratings
below BBB by Standard & Poor's or Baa by Moody's are considered to be
below investment grade.
(4) Backed by an escrow or trust containing sufficient U.S. Government or U.S.
Government agency securities which ensure the timely payment of principal
and interest. Such investments are normally considered to be equivalent to
AAA rated securities.
N/R Not rated.
(ETM) Escrowed to maturity.
(IF) Inverse floating rate investment.
(UB) Underlying bond of an inverse floating rate trust reflected as a financing
transaction. See Notes to Financial Statements, Footnote 1 - Inverse
Floating Rate Securities for more information.
144A Investment is exempt from registration under Rule 144A of the Securities
Act of 1933, as amended. These investments may only be resold in
transactions exempt from registration which are normally those
transactions with qualified institutional buyers.
See accompanying notes to financial statements.
28 Nuveen Investments
NUW | Nuveen Municipal Value Fund 2
| Portfolio of Investments October 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
ALASKA - 0.1%
$ 155 Northern Tobacco Securitization Corporation, Alaska, Tobacco 6/14 at 100.00 Baa3 $ 102,998
Settlement Asset-Backed Bonds, Series 2006A, 5.000%,
6/01/46
------------------------------------------------------------------------------------------------------------------------------------
ARIZONA - 3.4%
4,000 Maricopa County Pollution Control Corporation, Arizona, 2/19 at 100.00 BBB 4,443,600
Pollution Control Revenue Bonds, El Paso Electric Company,
Refunding Series 2009A, 7.250%, 2/01/40
2,995 Salt Verde Financial Corporation, Arizona, Senior Gas Revenue No Opt. Call A 2,561,773
Bonds, Series 2007, 5.000%, 12/01/37
------------------------------------------------------------------------------------------------------------------------------------
6,995 Total Arizona 7,005,373
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA - 9.9%
11,000 Alhambra Unified School District, Los Angeles County, No Opt. Call AAA 1,607,760
California, General Obligation Bonds, Capital Appreciation
Series 2009B, 0.000%, 8/01/41 - AGC Insured
2,500 California State Public Works Board, Lease Revenue Bonds, 4/19 at 100.00 A- 2,600,850
Department of General Services Buildings 8 & 9, Series
2009A, 6.250%, 4/01/34
2,150 Golden State Tobacco Securitization Corporation, California, 6/17 at 100.00 BBB 1,640,622
Enhanced Tobacco Settlement Asset-Backed Bonds, Series
2007A-1, 5.000%, 6/01/33
1,800 Golden State Tobacco Securitization Corporation, California, 6/15 at 100.00 A- 1,550,538
Tobacco Settlement Asset-Backed Revenue Bonds, Series
2005A, 5.000%, 6/01/45
450 M-S-R Energy Authority, California, Gas Revenue Bonds, Series No Opt. Call A 480,479
2009, 6.500%, 11/01/39
Palomar Pomerado Health, California, General Obligation
Bonds, Series 2009A:
9,320 0.000%, 8/01/33 - AGC Insured No Opt. Call AAA 2,231,301
10,200 0.000%, 8/01/38 - AGC Insured 8/29 at 100.00 AAA 6,408,660
Poway Unified School District, San Diego County, California,
School Facilities Improvement District 2007-1 General
Obligation Bonds, Series 2009A:
8,000 0.000%, 8/01/32 No Opt. Call AA- 2,038,640
8,000 0.000%, 8/01/33 No Opt. Call AA- 1,910,880
------------------------------------------------------------------------------------------------------------------------------------
53,420 Total California 20,469,730
------------------------------------------------------------------------------------------------------------------------------------
COLORADO - 5.2%
5,000 Denver City and County, Colorado, Airport System Revenue 11/15 at 100.00 A+ 5,083,250
Bonds, Series 2005A, 5.000%, 11/15/25 - SYNCORA GTY Insured
3,605 E-470 Public Highway Authority, Colorado, Toll Revenue Bonds, 9/20 at 67.94 A 1,118,595
Series 2004B, 0.000%, 9/01/27 - NPFG Insured
4,000 Park Creek Metropolitan District, Colorado, Senior Property No Opt. Call AAA 4,414,640
Tax Supported Revenue Bonds, Series 2009, 6.375%,
12/01/37 - AGC Insured
------------------------------------------------------------------------------------------------------------------------------------
12,605 Total Colorado 10,616,485
------------------------------------------------------------------------------------------------------------------------------------
FLORIDA - 8.8%
9,500 Miami-Dade County, Florida, Aviation Revenue Bonds, Miami 10/19 at 100.00 A2 9,601,555
International Airport, Series 2009A, 5.500%, 10/01/41
Miami-Dade County, Florida, General Obligation Bonds, Build
Better Communities Program, Series 2009-B1:
2,000 5.625%, 7/01/38 7/18 at 100.00 AA- 2,102,720
2,500 6.000%, 7/01/38 7/18 at 100.00 AA- 2,745,850
4,500 Tolomato Community Development District, Florida, Special 5/18 at 100.00 N/R 3,698,550
Assessment Bonds, Series 2007, 6.450%, 5/01/23
------------------------------------------------------------------------------------------------------------------------------------
18,500 Total Florida 18,148,675
------------------------------------------------------------------------------------------------------------------------------------
Nuveen Investments 29
NUW | Nuveen Municipal Value Fund 2 (continued)
| Portfolio of Investments October 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS - 11.9%
$ 5,000 Illinois Finance Authority, Revenue Bonds, Northwestern 8/19 at 100.00 AA+ $ 5,403,100
Memorial Hospital, Series 2009A, 6.000%, 8/15/39
3,500 Illinois Finance Authority, Revenue Bonds, OSF Healthcare 5/19 at 100.00 A 3,793,370
System, Series 2009A, 7.125%, 11/15/37
5,000 Illinois Finance Authority, Revenue Bonds, Rush University 11/18 at 100.00 A- 5,573,450
Medical Center Obligated Group, Series 2009A and 2009B,
7.250%, 11/01/38
3,995 Illinois Finance Authority, Student Housing Revenue Bonds, 5/17 at 100.00 Baa3 3,306,542
Educational Advancement Fund Inc., Refunding Series 2007A,
5.250%, 5/01/34
28,000 Metropolitan Pier and Exposition Authority, Illinois, Revenue No Opt. Call AAA 6,481,720
Bonds, McCormick Place Expansion Project, Series 2002A,
0.000%, 12/15/35 - NPFG Insured
------------------------------------------------------------------------------------------------------------------------------------
45,495 Total Illinois 24,558,182
------------------------------------------------------------------------------------------------------------------------------------
INDIANA - 5.3%
5,000 Indiana Finance Authority, Hospital Revenue Bonds, Deaconess 3/19 at 100.00 A+ 5,353,100
Hospital Obligated Group, Series 2009A, 6.750%, 3/01/39
3,650 Indiana Health Facility Financing Authority, Revenue Bonds, 3/17 at 100.00 BBB 3,481,224
Community Foundation of Northwest Indiana, Series 2007,
5.500%, 3/01/37
2,000 Indiana Municipal Power Agency, Power Supply System Revenue 1/19 at 100.00 A+ 2,151,600
Bonds, Series 2009B, 6.000%, 1/01/39
------------------------------------------------------------------------------------------------------------------------------------
10,650 Total Indiana 10,985,924
------------------------------------------------------------------------------------------------------------------------------------
IOWA - 1.1%
3,000 Iowa Tobacco Settlement Authority, Asset Backed Settlement 6/15 at 100.00 BBB 2,204,100
Revenue Bonds, Series 2005C, 5.375%, 6/01/38
------------------------------------------------------------------------------------------------------------------------------------
LOUISIANA - 7.4%
5,000 Louisiana Citizens Property Insurance Corporation, Assessment 6/18 at 100.00 AAA 5,572,750
Revenue Bonds, Series 2006C-3, 6.125%, 6/01/25
Louisiana Public Facilities Authority, Revenue Bonds, Ochsner
Clinic Foundation Project, Series 2007A:
7,000 5.375%, 5/15/43 5/17 at 100.00 A3 6,477,940
275 5.500%, 5/15/47 5/17 at 100.00 A3 258,566
3,255 St John Baptist Parish, Louisiana, Revenue Bonds, Marathon Oil 6/17 at 100.00 BBB+ 2,968,820
Corporation, Series 2007A, 5.125%, 6/01/37
------------------------------------------------------------------------------------------------------------------------------------
15,530 Total Louisiana 15,278,076
------------------------------------------------------------------------------------------------------------------------------------
MAINE - 1.8%
3,335 Maine Health and Higher Educational Facilities Authority, 7/19 at 100.00 Aa2 3,636,050
Revenue Bonds, Bowdoin College, Series 2009A, Tender Option
Bond Trust 09-5B, 12.943%, 7/01/39 (IF)
------------------------------------------------------------------------------------------------------------------------------------
MASSACHUSETTS - 2.8%
Massachusetts Turnpike Authority, Metropolitan Highway System
Revenue Bonds, Senior Series 1997A:
375 5.000%, 1/01/11 1/10 at 100.00 A- 376,009
1,200 5.000%, 1/01/13 - NPFG Insured 1/10 at 100.00 A 1,202,280
Massachusetts Turnpike Authority, Metropolitan Highway System
Revenue Bonds, Subordinate Series 1999A:
2,045 5.250%, 1/01/15 - AMBAC Insured 1/10 at 100.00 AA 2,051,728
1,000 4.750%, 1/01/34 - AMBAC Insured 1/10 at 100.00 AA 928,040
1,000 Massachusetts Water Pollution Abatement Trust, Pooled Loan 8/19 at 100.00 AAA 1,149,810
Program Bonds, Series 2009-14, 13.212%, 8/01/38 (IF)
------------------------------------------------------------------------------------------------------------------------------------
5,620 Total Massachusetts 5,707,867
------------------------------------------------------------------------------------------------------------------------------------
30 Nuveen Investments
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
MICHIGAN - 2.2%
$ 5,000 Detroit, Michigan, Second Lien Sewerage Disposal System 7/15 at 100.00 A $ 4,587,300
Revenue Bonds, Series 2005A, 5.000%, 7/01/35 - NPFG Insured
------------------------------------------------------------------------------------------------------------------------------------
NEVADA - 3.1%
250 Clark County, Nevada, Senior Lien Airport Revenue Bonds, No Opt. Call Aa2 244,910
Series 2005A, 5.000%, 7/01/40 - AMBAC Insured
5,415 Las Vegas Redevelopment Agency, Nevada, Tax Increment Revenue 6/19 at 100.00 A 6,079,583
Bonds, Series 2009A, 8.000%, 6/15/30
------------------------------------------------------------------------------------------------------------------------------------
5,665 Total Nevada 6,324,493
------------------------------------------------------------------------------------------------------------------------------------
NEW JERSEY - 2.8%
New Jersey Educational Facilities Authority Revenue Refunding
Bonds, University of Medicine and Dentistry of New Jersey
Issue, Series 2009 B:
2,135 7.125%, 12/01/23 6/19 at 100.00 Baa2 2,412,764
3,000 7.500%, 12/01/32 6/19 at 100.00 Baa2 3,389,640
------------------------------------------------------------------------------------------------------------------------------------
5,135 Total New Jersey 5,802,404
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK - 1.5%
3,000 Liberty Development Corporation, New York, Goldman Sachs No Opt. Call A1 3,057,690
Headquarters Revenue Bonds Series 2007, 5.500%, 10/01/37
------------------------------------------------------------------------------------------------------------------------------------
NORTH CAROLINA - 1.5%
3,000 North Carolina Municipal Power Agency 1, Catawba Electric 1/13 at 100.00 A 3,124,020
Revenue Bonds, Series 2003A, 5.250%, 1/01/19 - NPFG Insured
------------------------------------------------------------------------------------------------------------------------------------
OHIO - 5.8%
5,000 American Municipal Power Ohio INC Prairie State Energy Campus 2/19 at 100.00 AAA 5,279,000
Project Revenue Bonds Series 2009 A, 5.750%, 2/15/39 - AGC
Insured
5,500 Buckeye Tobacco Settlement Financing Authority, Ohio, Tobacco 6/17 at 100.00 BBB 4,451,920
Settlement Asset-Backed Revenue Bonds, Senior Lien,
Series 2007A-2, 6.500%, 6/01/47
2,000 Ohio State Higher Educational Facilities Commission, Hospital 1/15 at 100.00 A 2,145,300
Revenue Bonds, University Hospitals Health System, Series
2009, 6.750%, 1/15/39
------------------------------------------------------------------------------------------------------------------------------------
12,500 Total Ohio 11,876,220
------------------------------------------------------------------------------------------------------------------------------------
PUERTO RICO - 3.7%
4,390 Puerto Rico Aqueduct and Sewerage Authority, Revenue Bonds, 7/18 at 100.00 BBB- 4,487,721
Senior Lien Series 2008A, 6.000%, 7/01/44
3,000 Puerto Rico Sales Tax Financing Corporation, Sales Tax 8/19 at 100.00 A+ 3,151,050
Revenue Bonds, First Subordinate Series 2009A, 6.000%,
8/01/42
------------------------------------------------------------------------------------------------------------------------------------
7,390 Total Puerto Rico 7,638,771
------------------------------------------------------------------------------------------------------------------------------------
RHODE ISLAND - 3.1%
3,000 Rhode Island Health and Educational Building Corporation 5/19 at 100.00 A- 3,226,710
Hospital Financing Revenue Bonds, Lifespan Obligated Group
Issue, Series 2009A, 7.000%, 5/15/39
3,240 Rhode Island Tobacco Settlement Financing Corporation, 6/12 at 100.00 BBB 3,065,105
Tobacco Settlement Asset-Backed Bonds, Series 2002A,
6.125%, 6/01/32
------------------------------------------------------------------------------------------------------------------------------------
6,240 Total Rhode Island 6,291,815
------------------------------------------------------------------------------------------------------------------------------------
TEXAS - 7.4%
Leander Independent School District, Williamson and Travis
Counties, Texas, General Obligation Bonds, Series 2008:
13,510 0.000%, 8/15/39 8/17 at 27.35 AAA 2,432,340
19,300 0.000%, 8/15/41 8/17 at 24.20 AAA 3,046,312
5,300 North Texas Thruway Authority, Second Tier System Revenue 1/18 at 100.00 A3 5,361,480
Refunding Bonds, Series 2008, 5.750%, 1/01/38
5,000 Richardson Hospital Authority, Texas, Revenue Bonds, 12/13 at 100.00 Baa2 4,412,500
Richardson Regional Medical Center, Series 2004, 6.000%,
12/01/34
------------------------------------------------------------------------------------------------------------------------------------
43,110 Total Texas 15,252,632
------------------------------------------------------------------------------------------------------------------------------------
Nuveen Investments 31
NUW | Nuveen Municipal Value Fund 2 (continued)
| Portfolio of Investments October 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
VIRGIN ISLANDS - 0.5%
$ 1,000 Virgin Islands Public Finance Authority, Matching Fund 10/19 at 100.00 BBB $ 1,054,700
Revenue Loan Note - Diageo Project, Series 2009A, 6.750%,
10/01/37
------------------------------------------------------------------------------------------------------------------------------------
VIRGINIA - 1.1%
2,000 Washington County Industrial Development Authority , 1/19 at 100.00 BBB+ 2,286,340
Virginia, Hospital Revenue Bonds, Mountain States Health
Alliance, Series 2009C, 7.750%, 7/01/38
------------------------------------------------------------------------------------------------------------------------------------
WISCONSIN - 8.2%
195 Badger Tobacco Asset Securitization Corporation, Wisconsin, 6/12 at 100.00 AAA 213,078
Tobacco Settlement Asset-Backed Bonds, Series 2002,
6.125%, 6/01/27 (Pre-refunded 6/01/12)
5,000 Wisconsin Health and Educational Facilities Authority, 4/13 at 100.00 BBB+ 5,100,450
Revenue Bonds, Aurora Healthcare Inc., Series 2003,
6.400%, 4/15/33
1,500 Wisconsin Health and Educational Facilities Authority, 2/19 at 100.00 A+ 1,614,540
Revenue Bonds, ProHealth Care, Inc. Obligated Group,
Series 2009, 6.625%, 2/15/39
9,000 Wisconsin State, General Fund Annual Appropriation Revenue 5/19 at 100.00 AA- 9,902,971
Bonds, Series 2009A, 6.000%, 5/01/36
------------------------------------------------------------------------------------------------------------------------------------
15,695 Total Wisconsin 16,831,039
------------------------------------------------------------------------------------------------------------------------------------
$ 285,040 Total Investments (cost $178,424,376) - 98.6% 202,840,884
===============---------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 1.4% 2,867,774
------------------------------------------------------------------------------------------------------------------
Net Assets - 100% $ 205,708,658
==================================================================================================================
(1) All percentages shown in the Portfolio of Investments are based on net
assets.
(2) 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.
(3) Ratings (not covered by the report of independent registered public
accounting firm): Using the higher of Standard & Poor's Group ("Standard &
Poor's") or Moody's Investor Service, Inc. ("Moody's") rating. Ratings
below BBB by Standard & Poor's or Baa by Moody's are considered to be
below investment grade.
N/R Not rated.
(IF) Inverse floating rate investment.
See accompanying notes to financial statements.
32 Nuveen Investments
NMI | Nuveen Municipal Income Fund, Inc.
| Portfolio of Investments October 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
ALABAMA - 1.7%
$ 1,000 Courtland Industrial Development Board, Alabama, Solid Waste 6/15 at 100.00 BBB $ 890,010
Revenue Bonds, International Paper Company Project, Series
2005A, 5.200%, 6/01/25 (Alternative Minimum Tax)
690 Phenix City Industrial Development Board, Alabama, 5/12 at 100.00 BBB 581,194
Environmental Improvement Revenue Bonds, MeadWestvaco
Corporation, Series 2002A, 6.350%, 5/15/35 (Alternative
Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
1,690 Total Alabama 1,471,204
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA - 17.6%
5,530 Adelanto School District, San Bernardino County, California, No Opt. Call A 2,579,524
General Obligation Bonds, Series 1997A, 0.000%, 9/01/22 -
NPFG Insured
Brea Olinda Unified School District, California, General
Obligation Bonds, Series 1999A:
2,000 0.000%, 8/01/21 - FGIC Insured No Opt. Call AA- 1,105,940
2,070 0.000%, 8/01/22 - FGIC Insured No Opt. Call AA- 1,077,870
2,120 0.000%, 8/01/23 - FGIC Insured No Opt. Call AA- 1,004,308
500 California County Tobacco Securitization Agency, Tobacco 12/18 at 100.00 Baa3 405,250
Settlement Asset-Backed Bonds, Los Angeles County
Securitization Corporation, Series 2006A, 0.000%, 6/01/21
1,000 California Health Facilities Financing Authority, Revenue 4/16 at 100.00 A+ 956,700
Bonds, Kaiser Permanante System, Series 2006, 5.250%,
4/01/39
250 California Housing Finance Agency, California, Home Mortgage 2/17 at 100.00 AA- 203,105
Revenue Bonds, Series 2007E, 4.800%, 8/01/37 (Alternative
Minimum Tax)
3,000 California State Public Works Board, Lease Revenue Bonds, 6/14 at 100.00 A- 2,850,240
Department of Mental Health, Coalinga State Hospital,
Series 2004A, 5.000%, 6/01/25
1,000 California Statewide Community Development Authority, Revenue 7/15 at 100.00 BBB 834,460
Bonds, Daughters of Charity Health System, Series 2005A,
5.000%, 7/01/39
1,000 Golden State Tobacco Securitization Corporation, California, 6/17 at 100.00 BBB 738,880
Enhanced Tobacco Settlement Asset-Backed Bonds, Series
2007A-1, 5.750%, 6/01/47
2,000 Golden State Tobacco Securitization Corporation, California, 6/13 at 100.00 AAA 2,340,380
Tobacco Settlement Asset-Backed Bonds, Series 2003A-1,
6.750%, 6/01/39 (Pre-refunded 6/01/13)
500 Lake Elsinore Public Finance Authority, California, Local 10/13 at 102.00 N/R 485,355
Agency Revenue Refunding Bonds, Series 2003H, 6.375%,
10/01/33
300 M-S-R Energy Authority, California, Gas Revenue Bonds, Series No Opt. Call A 338,595
2009, 7.000%, 11/01/34
------------------------------------------------------------------------------------------------------------------------------------
21,270 Total California 14,920,607
------------------------------------------------------------------------------------------------------------------------------------
COLORADO - 6.7%
740 Colorado Educational and Cultural Facilities Authority, 7/12 at 100.00 BBB 727,672
Charter School Revenue Bonds, Douglas County School
District RE-1 - DCS Montessori School, Series 2002A,
6.000%, 7/15/22
375 Colorado Educational and Cultural Facilities Authority, 8/11 at 100.00 AAA 416,805
Charter School Revenue Bonds, Peak-to-Peak Charter School,
Series 2001, 7.500%, 8/15/21 (Pre-refunded 8/15/11)
1,000 Colorado Educational and Cultural Facilities Authority, Charter 6/11 at 100.00 Ba1 (4) 1,102,540
School Revenue Bonds, Weld County School District 6 -
Frontier Academy, Series 2001, 7.375%, 6/01/31
(Pre-refunded 6/01/11)
1,000 Colorado Health Facilities Authority, Revenue Bonds, 6/16 at 100.00 A- 906,300
Evangelical Lutheran Good Samaritan Society, Series 2005,
5.000%, 6/01/35
2,000 Denver City and County, Colorado, Airport System Revenue 11/10 at 100.00 A+ 2,031,060
Refunding Bonds, Series 2000A, 6.000%, 11/15/16 - AMBAC
Insured (Alternative Minimum Tax)
520 Public Authority for Colorado Energy, Natural Gas Revenue No Opt. Call A 541,653
Bonds, Colorado Springs Utilities, Series 2008, 6.125%,
11/15/23
------------------------------------------------------------------------------------------------------------------------------------
5,635 Total Colorado 5,726,030
------------------------------------------------------------------------------------------------------------------------------------
Nuveen Investments 33
NMI | Nuveen Municipal Income Fund, Inc. (continued)
| Portfolio of Investments October 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
CONNECTICUT - 2.2%
$ 1,480 Capitol Region Education Council, Connecticut, Revenue Bonds, 4/10 at 100.00 BBB $ 1,482,856
Series 1995, 6.750%, 10/15/15
395 Eastern Connecticut Resource Recovery Authority, Solid Waste 1/10 at 100.00 BBB 395,348
Revenue Bonds, Wheelabrator Lisbon Project, Series 1993A,
5.500%, 1/01/14 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
1,875 Total Connecticut 1,878,204
------------------------------------------------------------------------------------------------------------------------------------
FLORIDA - 2.8%
130 Dade County Industrial Development Authority, Florida, 12/09 at 100.00 N/R 116,539
Revenue Bonds, Miami Cerebral Palsy Residential Services
Inc., Series 1995, 8.000%, 6/01/22
1,250 Martin County Industrial Development Authority, Florida, 12/09 at 100.00 BB+ 1,250,313
Industrial Development Revenue Bonds, Indiantown
Cogeneration LP, Series 1994A, 7.875%, 12/15/25
(Alternative Minimum Tax)
600 Martin County Industrial Development Authority, Florida, 12/09 at 100.00 BB+ 600,204
Industrial Development Revenue Refunding Bonds, Indiantown
Cogeneration LP, Series 1995B, 8.050%, 12/15/25
(Alternative Minimum Tax)
670 Tolomato Community Development District, Florida, Special 5/14 at 101.00 N/R 431,018
Assessment Bonds, Series 2006, 5.400%, 5/01/37
------------------------------------------------------------------------------------------------------------------------------------
2,650 Total Florida 2,398,074
------------------------------------------------------------------------------------------------------------------------------------
GEORGIA - 0.9%
500 Atlanta, Georgia, Water and Wastewater Revenue Bonds, Series 11/19 at 100.00 AAA 505,040
2009B, 5.250%, 11/01/34 - FSA Insured
300 Main Street Natural Gas Inc., Georgia, Gas Project Revenue No Opt. Call A 283,245
Bonds, Series 2007B, 5.000%, 3/15/22
------------------------------------------------------------------------------------------------------------------------------------
800 Total Georgia 788,285
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS - 10.0%
1,060 Chicago, Illinois, Tax Increment Allocation Bonds, 1/10 at 100.00 N/R 1,060,731
Irving/Cicero Redevelopment Project, Series 1998, 7.000%,
1/01/14
1,500 Illinois Development Finance Authority, Pollution Control 12/09 at 100.00 BBB- 1,473,315
Revenue Refunding Bonds - CIPS Debt, Series 1993C-2,
5.950%, 8/15/26
500 Illinois Development Finance Authority, Revenue Bonds, 12/12 at 100.00 N/R (4) 569,935
Chicago Charter School Foundation, Series 2002A, 6.125%,
12/01/22 (Pre-refunded 12/01/12)
250 Illinois Finance Authority Revenue Bonds, Rush University No Opt. Call A- 268,895
Medical Center Obligated Group, Series 2009C, 6.375%,
11/01/29
1,480 Illinois Finance Authority, Revenue Bonds, Children's 8/18 at 100.00 AAA 1,527,390
Memorial Hospital, Tender Option Bond Trust 2008-1098,
12.643%, 8/15/33 - AGC Insured (IF)
500 Illinois Finance Authority, Revenue Bonds, Silver Cross 8/19 at 100.00 BBB 526,270
Hospital and Medical Centers, Series 2009, 7.000%, 8/15/44
1,550 Illinois Health Facilities Authority, Revenue Bonds, Condell 5/12 at 100.00 Aaa 1,718,160
Medical Center, Series 2002, 5.500%, 5/15/32 (Pre-refunded
5/15/12)
1,305 North Chicago, Illinois, General Obligation Bonds, Series 11/15 at 100.00 A 1,347,308
2005B, 5.000%, 11/01/25 - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
8,145 Total Illinois 8,492,004
------------------------------------------------------------------------------------------------------------------------------------
INDIANA - 3.6%
2,000 Indiana Health Facility Financing Authority, Hospital Revenue 8/12 at 101.00 Baa1 1,989,080
Bonds, Riverview Hospital, Series 2002, 6.125%, 8/01/31
1,085 Whitley County, Indiana, Solid Waste and Sewerage Disposal 11/10 at 102.00 N/R 1,033,473
Revenue Bonds, Steel Dynamics Inc., Series 1998, 7.250%,
11/01/18 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
3,085 Total Indiana 3,022,553
------------------------------------------------------------------------------------------------------------------------------------
KENTUCKY - 1.8%
1,500 Louisville-Jefferson County Metropolitan Government, 2/18 at 100.00 A 1,572,525
Kentucky, Health Facilities Revenue Bonds, Jewish Hospital
& Saint Mary's HealthCare Inc. Project, Series 2008,
6.125%, 2/01/37
------------------------------------------------------------------------------------------------------------------------------------
34 Nuveen Investments
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
LOUISIANA - 2.4%
$ 500 Louisiana Local Government Environmental Facilities and 1/19 at 100.00 AAA $ 515,400
Community Development Authority, Revenue Refunding Bonds,
City of Shreveport Airport System Project, Series 2008A,
5.750%, 1/01/28 - FSA Insured
Louisiana Public Facilities Authority, Extended Care
Facilities Revenue Bonds, Comm-Care Corporation Project,
Series 1994:
125 11.000%, 2/01/14 (ETM) No Opt. Call N/R (4) 150,881
1,130 11.000%, 2/01/14 (ETM) No Opt. Call N/R (4) 1,363,729
------------------------------------------------------------------------------------------------------------------------------------
1,755 Total Louisiana 2,030,010
------------------------------------------------------------------------------------------------------------------------------------
MARYLAND - 1.2%
1,000 Maryland Energy Financing Administration, Revenue Bonds, AES 9/10 at 100.00 N/R 1,000,260
Warrior Run Project, Series 1995, 7.400%, 9/01/19
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
MASSACHUSETTS - 1.9%
335 Massachusetts Development Finance Agency, Resource Recovery 12/09 at 102.00 BBB 330,591
Revenue Bonds, Ogden Haverhill Associates, Series 1999A,
6.700%, 12/01/14 (Alternative Minimum Tax)
1,500 Massachusetts Development Finance Agency, Revenue Bonds, 1/17 at 100.00 N/R 1,053,000
Boston Architectural College, Series 2006, 5.000%,
1/01/37 - ACA Insured
270 Massachusetts Industrial Finance Agency, Resource Recovery 12/09 at 101.00 BBB 259,554
Revenue Refunding Bonds, Ogden Haverhill Project, Series
1998A, 5.450%, 12/01/12 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
2,105 Total Massachusetts 1,643,145
------------------------------------------------------------------------------------------------------------------------------------
MICHIGAN - 3.5%
1,000 Delta County Economic Development Corporation, Michigan, 4/12 at 100.00 AAA 1,130,520
Environmental Improvement Revenue Refunding Bonds,
MeadWestvaco Corporation - Escanaba Paper Company, Series
2002B, 6.450%, 4/15/23 (Pre-refunded 4/15/12) (Alternative
Minimum Tax)
1,880 Michigan State Hospital Finance Authority, Hospital Revenue 1/10 at 100.00 BB 1,879,793
Refunding Bonds, Sinai Hospital, Series 1995, 6.625%,
1/01/16
------------------------------------------------------------------------------------------------------------------------------------
2,880 Total Michigan 3,010,313
------------------------------------------------------------------------------------------------------------------------------------
MISSOURI - 5.0%
265 Hanley Road Corridor Transportation Development District, 10/19 at 100.00 A- 267,862
Brentwood and Maplewood, Missouri, Transportation Sales
Revenue Bonds, Series 2009, 5.875%, 10/01/36
4,450 Missouri Environmental Improvement and Energy Resources 12/16 at 100.00 AAA 3,945,103
Authority, Water Facility Revenue Bonds, Missouri-American
Water Company, Series 2006, 4.600%, 12/01/36 - AMBAC
Insured (Alternative Minimum Tax) (UB)
------------------------------------------------------------------------------------------------------------------------------------
4,715 Total Missouri 4,212,965
------------------------------------------------------------------------------------------------------------------------------------
MONTANA - 1.0%
1,200 Montana Board of Investments, Exempt Facility Revenue Bonds, 7/10 at 101.00 B- 870,192
Stillwater Mining Company, Series 2000, 8.000%, 7/01/20
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
NEBRASKA - 1.2%
1,000 Washington County, Nebraska, Wastewater Facilities Revenue 11/12 at 101.00 A 1,012,940
Bonds, Cargill Inc., Series 2002, 5.900%, 11/01/27
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK - 5.7%
1,000 Dormitory Authority of the State of New York, Revenue Bonds, 7/13 at 100.00 BBB+ 1,047,880
Brooklyn Law School, Series 2003A, 5.500%, 7/01/15 - RAAI
Insured
3,565 Yates County Industrial Development Agency, New York, 2/11 at 101.00 AAA 3,807,774
FHA-Insured Civic Facility Mortgage Revenue Bonds,
Soldiers and Sailors Memorial Hospital, Series 2000A,
6.000%, 2/01/41
------------------------------------------------------------------------------------------------------------------------------------
4,565 Total New York 4,855,654
------------------------------------------------------------------------------------------------------------------------------------
Nuveen Investments 35
NMI | Nuveen Municipal Income Fund, Inc. (continued)
| Portfolio of Investments October 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
OHIO - 3.8%
$ 520 Buckeye Tobacco Settlement Financing Authority, Ohio, Tobacco 6/17 at 100.00 BBB $ 385,278
Settlement Asset-Backed Revenue Bonds, Senior Lien,
Series 2007A-2, 5.875%, 6/01/47
1,000 Erie County, Ohio, Hospital Facilities Revenue Bonds, 8/16 at 100.00 A 833,900
Firelands Regional Medical Center Project, Series 2006,
5.250%, 8/15/46
2,100 Ohio Water Development Authority, Solid Waste Disposal 3/10 at 102.00 N/R 2,016,042
Revenue Bonds, Bay Shore Power, Series 1998B, 6.625%,
9/01/20 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
3,620 Total Ohio 3,235,220
------------------------------------------------------------------------------------------------------------------------------------
PENNSYLVANIA - 1.8%
1,080 Allegheny County Hospital Development Authority, 11/10 at 102.00 AAA 1,200,215
Pennsylvania, Revenue Bonds, West Penn Allegheny Health
System, Series 2000B, 9.250%, 11/15/30 (Pre-refunded
11/15/10)
305 Carbon County Industrial Development Authority, Pennsylvania, No Opt. Call BBB- 308,135
Resource Recovery Revenue Refunding Bonds, Panther Creek
Partners Project, Series 2000, 6.650%, 5/01/10
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
1,385 Total Pennsylvania 1,508,350
------------------------------------------------------------------------------------------------------------------------------------
RHODE ISLAND - 1.1%
1,000 Rhode Island Tobacco Settlement Financing Corporation, 6/12 at 100.00 BBB 908,890
Tobacco Settlement Asset-Backed Bonds, Series 2002A,
6.250%, 6/01/42
------------------------------------------------------------------------------------------------------------------------------------
SOUTH CAROLINA - 4.8%
1,500 Greenville County School District, South Carolina, 12/12 at 101.00 AA 1,652,175
Installment Purchase Revenue Bonds, Series 2002, 5.500%,
12/01/13
475 Piedmont Municipal Power Agency, South Carolina, Electric No Opt. Call Baa1 (4) 617,510
Revenue Bonds, Series 1991, 6.750%, 1/01/19 - FGIC Insured
(ETM)
1,105 South Carolina JOBS Economic Development Authority, Economic 11/12 at 100.00 A- 1,113,398
Development Revenue Bonds, Bon Secours Health System Inc.,
Series 2002B, 5.625%, 11/15/30
655 Tobacco Settlement Revenue Management Authority, South 5/12 at 100.00 BBB (4) 687,331
Carolina, Tobacco Settlement Asset-Backed Bonds, Series
2001B, 6.000%, 5/15/22 (Pre-refunded 5/15/12)
------------------------------------------------------------------------------------------------------------------------------------
3,735 Total South Carolina 4,070,414
------------------------------------------------------------------------------------------------------------------------------------
TENNESSEE - 2.8%
1,000 Knox County Health, Educational and Housing Facilities Board, 4/12 at 101.00 A1 1,033,470
Tennessee, Hospital Revenue Bonds, Baptist Health System
of East Tennessee Inc., Series 2002, 6.375%, 4/15/22
Shelby County Health, Educational and Housing Facilities
Board, Tennessee, Hospital Revenue Bonds, Methodist
Healthcare, Series 2002:
375 6.500%, 9/01/26 (Pre-refunded 9/01/12) 9/12 at 100.00 AAA 430,568
625 6.500%, 9/01/26 (Pre-refunded 9/01/12) 9/12 at 100.00 AAA 717,613
500 Sumner County Health, Educational, and Housing Facilities 11/17 at 100.00 N/R 190,050
Board, Tennessee, Revenue Refunding Bonds, Sumner Regional
Health System Inc., Series 2007, 5.500%, 11/01/37
------------------------------------------------------------------------------------------------------------------------------------
2,500 Total Tennessee 2,371,701
------------------------------------------------------------------------------------------------------------------------------------
TEXAS - 10.5%
1,500 Cameron Education Finance Corporation, Texas, Charter School 8/16 at 100.00 BBB- 1,190,250
Revenue Bonds, Faith Family Academy Charter School, Series
2006A, 5.250%, 8/15/36 - ACA Insured
2,000 Gulf Coast Waste Disposal Authority, Texas, Sewerage and 4/12 at 100.00 BBB+ 1,976,160
Solid Waste Disposal Revenue Bonds, Anheuser Busch
Company, Series 2002, 5.900%, 4/01/36 (Alternative Minimum
Tax)
2,000 Matagorda County Navigation District 1, Texas, Collateralized 10/13 at 101.00 A 1,889,120
Revenue Refunding Bonds, Houston Light and Power Company,
Series 1995, 4.000%, 10/15/15 - NPFG Insured
North Texas Thruway Authority, Second Tier System Revenue
Refunding Bonds, Tender Option Bond Trust 2903:
850 17.347%, 1/01/38 (IF) 1/18 at 100.00 A3 985,600
150 17.444%, 1/01/38 (IF) 1/18 at 100.00 A3 177,683
36 Nuveen Investments
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
TEXAS (continued)
Weslaco Health Facilities Development Corporation, Texas,
Hospital Revenue Bonds, Knapp Medical Center, Series 2002:
$ 2,000 6.250%, 6/01/25 (Pre-refunded 6/01/12) 6/12 at 100.00 N/R (4) $ 2,227,520
50 6.250%, 6/01/32 (Pre-refunded 6/01/12) 6/12 at 100.00 N/R (4) 55,688
1,000 West Texas Independent School District, McLennan and Hill 8/13 at 51.84 AAA 433,740
Counties, General Obligation Refunding Bonds, Series 1998,
0.000%, 8/15/25
------------------------------------------------------------------------------------------------------------------------------------
9,550 Total Texas 8,935,761
------------------------------------------------------------------------------------------------------------------------------------
VIRGIN ISLANDS - 2.9%
420 Virgin Islands Public Finance Authority, Matching Fund 10/19 at 100.00 BBB 442,974
Revenue Loan Note - Diageo Project, Series 2009A, 6.750%,
10/01/37
2,000 Virgin Islands Public Finance Authority, Senior Lien Matching 10/14 at 100.00 BBB 2,032,100
Fund Loan Note, Series 2004A, 5.250%, 10/01/19
------------------------------------------------------------------------------------------------------------------------------------
2,420 Total Virgin Islands 2,475,074
------------------------------------------------------------------------------------------------------------------------------------
VIRGINIA - 3.0%
1,000 Chesterfield County Industrial Development Authority, 11/10 at 102.00 Baa1 1,031,460
Virginia, Pollution Control Revenue Bonds, Virginia
Electric and Power Company, Series 1987A, 5.875%, 6/01/17
1,500 Mecklenburg County Industrial Development Authority, 10/12 at 100.00 Baa1 1,469,040
Virginia, Revenue Bonds, UAE Mecklenburg Cogeneration LP,
Series 2002, 6.500%, 10/15/17 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
2,500 Total Virginia 2,500,500
------------------------------------------------------------------------------------------------------------------------------------
WASHINGTON - 0.6%
500 Washington State Health Care Facilities Authority, Revenue No Opt. Call N/R 400,045
Bonds, Northwest Hospital and Medical Center of Seattle,
Series 2007, 5.700%, 12/01/32
------------------------------------------------------------------------------------------------------------------------------------
WISCONSIN - 1.2%
1,000 Wisconsin Health and Educational Facilities Authority, 10/11 at 100.00 BBB 1,018,350
Revenue Bonds, Carroll College Inc., Series 2001, 6.250%,
10/01/21
------------------------------------------------------------------------------------------------------------------------------------
$ 94,080 Total Investments (cost $85,406,630) - 101.7% 86,329,270
===============---------------------------------------------------------------------------------------------------------------------
Floating Rate Obligations - (3.9)% (3,335,000)
------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 2.2% 1,888,791
------------------------------------------------------------------------------------------------------------------
Net Assets - 100% $ 84,883,061
==================================================================================================================
(1) All percentages shown in the Portfolio of Investments are based on net
assets.
(2) 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.
(3) Ratings (not covered by the report of independent registered public
accounting firm): Using the higher of Standard & Poor's Group ("Standard &
Poor's") or Moody's Investor Service, Inc. ("Moody's") rating. Ratings
below BBB by Standard & Poor's or Baa by Moody's are considered to be
below investment grade.
(4) Backed by an escrow or trust containing sufficient U.S. Government or U.S.
Government agency securities which ensure the timely payment of principal
and interest. Such investments are normally considered to be equivalent to
AAA rated securities.
N/R Not rated.
(ETM) Escrowed to maturity.
(IF) Inverse floating rate investment.
(UB) Underlying bond of an inverse floating rate trust reflected as a financing
transaction. See Notes to Financial Statements, Footnote 1 - Inverse
Floating Rate Securities for more information.
See accompanying notes to financial statements.
Nuveen Investments 37
NEV | Nuveen Enhanced Municipal Value Fund
| Portfolio of Investments October 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
ALABAMA - 0.1%
$ 355 Courtland Industrial Development Board, Alabama, Solid Waste 6/15 at 100.00 BBB $ 315,954
Revenue Bonds, International Paper Company Project, Series
2005A, 5.200%, 6/01/25 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
ARIZONA - 4.9%
2,925 Nogales Municipal Development Authority, Inc., Arizona, 6/19 at 100.00 AA 2,786,531
Municipal Facilities Revenue Bonds, Series 2009, 4.750%,
6/01/39
3,000 Pima County Industrial Development Authority, Arizona, No Opt. Call BBB- 3,019,020
Pollution Control Revenue Bonds, Tucson Electric Power
Company, San Juan Porject, Series 2009A, 4.950%, 10/01/20
320 Quechan Indian Tribe of the Fort Yuma Reservation, Arizona, 12/17 at 102.00 N/R 251,238
Government Project Bonds, Series 2007, 7.000%, 12/01/27
Salt Verde Financial Corporation, Arizona, Senior Gas Revenue
Bonds, Series 2007:
50 5.000%, 12/01/32 No Opt. Call A 44,944
5,120 5.000%, 12/01/37 No Opt. Call A 4,379,392
2,000 Watson Road Community Facilities District, Arizona, Special 7/16 at 100.00 N/R 1,566,720
Assessment Revenue Bonds, Series 2005, 6.000%, 7/01/30
------------------------------------------------------------------------------------------------------------------------------------
13,415 Total Arizona 12,047,845
------------------------------------------------------------------------------------------------------------------------------------
ARKANSAS - 0.2%
465 Little River County, Arkansas, Revenue Refunding Bonds, 4/10 at 100.00 B2 412,329
Georgia-Pacific Corporation, Series 1998, 5.600%, 10/01/26
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA - 17.2%
5,445 Peralta California Community College District 2006 Election, 8/19 at 100.00 AA- 5,511,701
General Obligations Bond, Series 2009C, 5.000%, 8/01/39
2,000 California Infrastructure Economic Development Bank, Revenue 10/11 at 101.00 A- 1,888,540
Bonds, J. David Gladstone Institutes, Series 2001, 5.250%,
10/01/34
3,470 California Statewide Community Development Authority, Revenue 7/15 at 100.00 BBB 3,292,752
Bonds, Daughters of Charity Health System, Series 2005A,
5.250%, 7/01/24
4,600 California Statewide Community Development Authority, Revenue 8/18 at 100.00 AAA 4,599,632
Bonds, Sutter Health, Series 2004C, 5.050%, 8/15/38 - FSA
Insured
6,125 California Statewide Community Development Authority, Revenue 8/18 at 100.00 AAA 6,124,509
Bonds, Sutter Health, Series 2004D, 5.050%, 8/15/38 - FSA
Insured
Golden State Tobacco Securitization Corporation, California,
Enhanced Tobacco Settlement Asset-Backed Bonds, Series
2007A-1:
1,000 5.125%, 6/01/47 6/17 at 100.00 BBB 664,390
5,505 5.750%, 6/01/47 6/17 at 100.00 BBB 4,067,534
5,000 Golden State Tobacco Securitization Corporation, California, 6/15 at 100.00 AAA 4,441,200
Tobacco Settlement Asset-Backed Revenue Bonds, Series
2005A, 5.000%, 6/01/45
1,735 Lompoc Unified School District, Santa Barbara County, 6/17 at 100.00 AAA 1,738,175
California, General Obligation Bonds, Election 2002 Series
2007C, 5.000%, 6/01/32 - FSA Insured
100 Los Angeles Regional Airports Improvement Corporation, 12/12 at 102.00 B- 95,738
California, Sublease Revenue Bonds, Los Angeles
International Airport, American Airlines Inc. Terminal 4
Project, Series 2002B, 7.500%, 12/01/24 (Alternative
Minimum Tax)
1,750 Orange County Water District, California, Revenue 8/19 at 100.00 AAA 1,833,423
Certificates of Participation, Tender Option Bond Trust
3117, 16.340%, 8/15/39 (IF)
2,170 San Marcos Public Facilities Authority, California, Tax 8/15 at 102.00 AAA 2,245,473
Allocation Bonds, Project Areas 2 and 3, Tender Option
Bond Trust 3116, 21.664%, 8/01/38 - FSA Insured (IF)
2,400 Semitrophic Improvement District of Semitrophic Water Storage 12/19 at 100.00 AA- 2,437,272
Dustrict, Kern County, California, Revenue Bonds, Tender
Option Bond Trust 3584, 22.029%, 12/01/34 (IF)
3,110 Stockton Unified School District, San Joaquin County, 8/17 at 100.00 AAA 3,127,634
California, General Obligation Bonds, Series 2007, 5.000%,
8/01/31 - FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
44,410 Total California 42,067,973
------------------------------------------------------------------------------------------------------------------------------------
COLORADO - 3.5%
1,000 Colorado Educational and Cultural Facilities Authority 7/19 at 100.00 N/R 901,550
Charter School Revenue Bonds (Crown Ponite Academy of
Westminster Project) A Charter School Chartered Through
Adams County School District No. 50 Adams County, Colorado
Series 2009, 5.000%, 7/15/39
38 Nuveen Investments
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
COLORADO (continued)
$ 1,000 Colorado Housing & Finance Authority, Multifamily Housing 12/10 at 100.00 N/R $ 869,340
Revenue Senior Bonds, Castle Highlands Project, Series
2000A-1, 5.900%, 12/01/20 - AMBAC Insured (Alternative
Minimum Tax)
250 Colorado Housing and Finance Authority, Revenue Bonds, No Opt. Call N/R 217,645
Confluence Energy LLC Project, Series 2007, 6.200%,
4/01/16 (Alternative Minimum Tax)
2,000 Conservatory Metropolitan District, Arapahoe County, 12/17 at 100.00 BBB- 1,452,060
Colorado, General Obligation Limited Tax Bonds, Series
2007, 5.125%, 12/01/37 - RAAI Insured
Public Authority for Colorado Energy, Natural Gas Revenue
Bonds, Colorado Springs Utilities, Series 2008:
540 6.125%, 11/15/23 No Opt. Call A 562,486
475 6.250%, 11/15/28 No Opt. Call A 493,516
3,880 6.500%, 11/15/38 No Opt. Call A 4,084,398
------------------------------------------------------------------------------------------------------------------------------------
9,145 Total Colorado 8,580,995
------------------------------------------------------------------------------------------------------------------------------------
DISTRICT OF COLUMBIA - 0.1%
400 District of Columbia Tobacco Settlement Corporation, Tobacco 5/11 at 101.00 BBB 389,408
Settlement Asset-Backed Bonds, Series 2001, 6.750%, 5/15/40
------------------------------------------------------------------------------------------------------------------------------------
FLORIDA - 9.0%
4,295 Florida Housing Finance Corporation, Homeowner Mortgage 7/19 at 100.00 AA+ 4,218,678
Revenue Bonds, Series 2009-2, 4.650%, 7/01/29
3,160 JEA, Florida, Water and Sewerage System Revenue Bonds, Tender 4/10 at 100.00 AA- 2,373,729
Option Bond Trust 11801, 20.605%, 10/01/41 - NPFG Insured
(IF)
2,400 Miami-Dade County School Board, Florida, Certificates of 11/16 at 100.00 AAA 2,627,040
Participation, Tender Option Bond Trust 3118, 21.645%,
11/01/31 - BHAC Insured (IF)
3,660 Miami-Dade County, Florida Capital Asset Acquisition Special 4/19 at 100.00 AAA 3,685,693
Obligation Bonds Series 2009A, 5.125%, 4/01/34 - AGC
Insured
5,500 Orange County Health Facilities Authority, Florida, Revenue 1/19 at 100.00 AA+ 5,556,044
Bonds, Nemours Foundation, Series 2009A, 5.000%, 1/01/39
1,000 South Miami Health Facilities Authority, Florida, Hospital 8/17 at 100.00 AA- 804,020
Revenue, Baptist Health System Obligation Group, Tender
Option Bond Trust 3119, 17.848%, 8/15/37 (IF)
2,500 Tallahassee, Florida, Energy System Revenue Bonds, Tender 10/15 at 100.00 AA- 2,646,325
Option Bond Trust 09-30W, 21.549%, 10/01/35 - NPFG Insured
(IF)
------------------------------------------------------------------------------------------------------------------------------------
22,515 Total Florida 21,911,529
------------------------------------------------------------------------------------------------------------------------------------
GEORGIA - 0.2%
225 Effingham County Development Authority, Georgia, Solid Waste 7/10 at 100.00 BB- 208,427
Disposal Revenue Bonds, Ft. James Project, Series 1998,
5.625%, 7/01/18 (Alternative Minimum Tax) (4)
150 Main Street Natural Gas Inc., Georgia, Gas Project Revenue No Opt. Call A 144,485
Bonds, Series 2007A, 5.500%, 9/15/26
90 Main Street Natural Gas Inc., Georgia, Gas Project Revenue No Opt. Call A 84,974
Bonds, Series 2007B, 5.000%, 3/15/22
------------------------------------------------------------------------------------------------------------------------------------
465 Total Georgia 437,886
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS - 2.2%
1,460 Hoffman Estates, Illinois, General Obligation Bonds, Tender 12/18 at 100.00 AA+ 1,619,739
Option Bond Trust 09-28W, 25.665%, 12/01/38 (IF)
3,000 Illinois Finance Authority, Revenue Bonds, Illinois Institute 4/16 at 100.00 Baa2 2,517,870
of Technology, Refunding Series 2006A, 5.000%, 4/01/36
1,500 Southwestern Illinois Development Authority, Illinois, Saint 6/17 at 103.00 N/R 1,340,355
Clair County Comprehensive Mental Health Center, Series
2007, 6.625%, 6/01/37
------------------------------------------------------------------------------------------------------------------------------------
5,960 Total Illinois 5,477,964
------------------------------------------------------------------------------------------------------------------------------------
INDIANA - 4.7%
8,000 Indiana Finance Authority Health System Revenue Bonds Series 11/19 at 100.00 Aa3 7,811,039
2009A (Sisters of St. Francis Health Services, Inc.
Obligated Group), 5.250%, 11/01/39 (WI/DD, Settling
11/05/09)
3,850 Indiana Health Facility Financing Authority, Hospital Revenue 2/16 at 100.00 A+ 3,622,196
Bonds, Clarian Health Obligation Group, Series 2006A,
5.250%, 2/15/40
------------------------------------------------------------------------------------------------------------------------------------
11,850 Total Indiana 11,433,235
------------------------------------------------------------------------------------------------------------------------------------
Nuveen Investments 39
NEV | Nuveen Enhanced Municipal Value Fund (continued)
| Portfolio of Investments October 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
LOUISIANA - 0.2%
$ 555 Tobacco Settlement Financing Corporation, Louisiana, Tobacco 5/11 at 101.00 BBB $ 502,303
Settlement Asset-Backed Bonds, Series 2001B, 5.875%,
5/15/39
------------------------------------------------------------------------------------------------------------------------------------
MAINE - 0.8%
2,000 Maine State Housing Authority, Single Family Mortgage 1/19 at 100.00 AA+ 2,057,960
Purchase Bonds, Tender Option Bond Trust 3597, 0.000%,
11/15/29 (WI/DD, Settling 11/12/09) (IF)
------------------------------------------------------------------------------------------------------------------------------------
MASSACHUSETTS - 3.5%
220 Massachusetts Development Finance Agency, Revenue Bonds, 3/15 at 100.00 BBB 193,591
Curry College, Series 2005A, 5.000%, 3/01/35 - ACA Insured
3,000 Massachusetts Health and Educational Facilities Authority 1/18 at 100.00 N/R 2,674,800
Revenue Bonds, Quincy Medical Center Issue, Series A
(2008), 6.250%, 1/15/28
3,510 Massachusetts Health and Educational Facilities Authority, 6/13 at 100.00 AA- 3,824,426
Revenue Bonds, Boston College, Tender Option Bond Trust
3115, 15.590%, 6/01/37 (IF)
2,385 Massachusetts Health and Educational Facilities Authority, 8/15 at 100.00 BBB- 1,775,776
Revenue Bonds, Emerson Hospital, Series 2005E, 5.000%,
8/15/35 - RAAI Insured
------------------------------------------------------------------------------------------------------------------------------------
9,115 Total Massachusetts 8,468,593
------------------------------------------------------------------------------------------------------------------------------------
MICHIGAN - 8.5%
12,000 Detroit City School District, Wayne County, Michigan, General No Opt. Call AAA 12,151,196
Obligation Bonds, Series 2005, 5.250%, 5/01/27 - FSA
Insured
2,865 Marysville Public School District, St Claire County, 5/17 at 100.00 AAA 2,904,336
Michigan, General Obligation Bonds, Series 2007, 5.000%,
5/01/32 - FSA Insured
4,600 Michigan State Hospital Finance Authority, Hospital Revenue 11/19 at 100.00 A1 4,440,656
Bonds, Henry Ford Health System, Refunding Series 2009,
5.750%, 11/15/39 (WI/DD, Settling 11/03/09)
1,645 Michigan State Hospital Finance Authority, Hospital Revenue 2/10 at 100.00 BB- 1,291,243
Refunding Bonds, Detroit Medical Center Obligated Group,
Series 1997A, 5.250%, 8/15/27 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
21,110 Total Michigan 20,787,431
------------------------------------------------------------------------------------------------------------------------------------
NEW JERSEY - 0.3%
1,000 Tobacco Settlement Financing Corporation, New Jersey, Tobacco 6/17 at 100.00 BBB 674,840
Settlement Asset-Backed Bonds, Series 2007-1A, 5.000%,
6/01/41
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK - 1.0%
2,500 New York City Industrial Development Agency, New York, 8/16 at 101.00 B- 2,428,075
American Airlines-JFK International Airport Special
Facility Revenue Bonds, Series 2005, 7.750%, 8/01/31
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
NORTH CAROLINA - 2.2%
3,485 North Carolina Medical Care Commission, Healthcare Facilities 6/19 at 100.00 AA 3,446,142
Revenue Bonds, Duke University Health System, Series
2009A, 5.000%, 6/01/42 (WI/DD, Settling 11/10/09)
2,000 North Carolina Medical Care Commission, Healthcare Facilities 6/19 at 100.00 AA 1,888,500
Revenue Bonds, Duke University Health System, Tender
Option Bond Trust 11808, 0.000%, 6/01/42 (WI/DD, Settling
11/10/09) (IF)
------------------------------------------------------------------------------------------------------------------------------------
5,485 Total North Carolina 5,334,642
------------------------------------------------------------------------------------------------------------------------------------
OHIO - 7.0%
Buckeye Tobacco Settlement Financing Authority, Ohio, Tobacco
Settlement Asset-Backed Revenue Bonds, Senior Lien, Series
2007A-2:
3,000 5.875%, 6/01/47 6/17 at 100.00 BBB 2,222,760
10,500 6.500%, 6/01/47 6/17 at 100.00 BBB 8,499,119
2,000 Greene County, Ohio, Hospital Facilities Revenue Bonds, 4/19 at 100.00 A 1,935,240
Kettering Health Nretwork Series 2009, 5.375%, 4/01/34
(WI/DD, Settling 11/03/09)
1,200 Ohio Air Quality Development Authority, Ohio, Air Quality No Opt. Call BBB- 1,201,836
Revenue Bonds, Ohio Valley Electric Corporation Project,
Series 2009E. Non-AMT, 5.625%, 10/01/19
2,000 Ohio Housing Finance Agency, Residential Mortgage Revenue 9/18 at 100.00 Aaa 2,077,500
Bonds, Mortgage-Backed Securities Program, Tender Option
Bond Trust 09-35W, 21.549%, 3/01/40 (IF)
1,000 Ohio State, Hospital Facility Revenue Refunding Bonds, 1/19 at 100.00 Aa2 1,142,420
Cleveland Clinic Health System Obligated Group, Tender
Option Bond Trust 3591, 20.143%, 1/01/39 (IF)
------------------------------------------------------------------------------------------------------------------------------------
19,700 Total Ohio 17,078,875
------------------------------------------------------------------------------------------------------------------------------------
40 Nuveen Investments
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
OKLAHOMA - 0.5%
$ 1,130 Tulsa Municipal Airport Trust, Oklahoma, Revenue Bonds, 12/09 at 100.00 B- $ 1,108,858
American Airlines Inc., Series 1992, 7.350%, 12/01/11
------------------------------------------------------------------------------------------------------------------------------------
OREGON - 0.7%
185 Oregon, Economic Development Revenue Bonds, Georgia Pacific 2/10 at 100.00 BB- 179,345
Corp., Series 1995CLVII, 6.350%, 8/01/25 (Alternative
Minimum Tax) (4)
70 Oregon, Economic Development Revenue Refunding Bonds, Georgia 12/09 at 100.00 B2 62,786
Pacific Corp., Series 1997-183, 5.700%, 12/01/25
1,500 Port Astoria, Oregon, Pollution Control Revenue Bonds, James 2/10 at 100.00 BB- 1,488,015
River Project, Series 1993, 6.550%, 2/01/15
------------------------------------------------------------------------------------------------------------------------------------
1,755 Total Oregon 1,730,146
------------------------------------------------------------------------------------------------------------------------------------
PENNSYLVANIA - 4.3%
1,335 Allegheny County Hospital Development Authority, 4/15 at 100.00 Baa2 1,115,299
Pennsylvania, Revenue Bonds, Ohio Valley General Hospital,
Series 2005A, 5.125%, 4/01/35
2,000 Luzerne County Industrial Development Authority, 12/19 at 100.00 N/R 1,956,020
Pennsylvania, Guaranteed Lease Revenue Bonds, Series 2009,
7.750%, 12/15/27 (WI/DD, Settling 11/10/09)
25 Northumberland County Industrial Development Authority, 2/13 at 102.00 N/R 24,522
Pennsylvania, Facility Revenue Bonds, NHS Youth Services
Inc., Series 2002, 7.500%, 2/15/29
1,000 Pennsylvania Economic Development Finance Authority, Solid 12/09 at 102.00 B+ 784,150
Waste Disposal Revenue Bonds (USG Corporation Project)
Series 1999, 6.000%, 6/01/31 (Alternative Minimum Tax)
785 Pennsylvania Economic Development Financing Authority Health No Opt. Call A3 822,908
System Revenue Bonds Albert Einstein Healthcare Network
Issue, Series 2009A, 6.250%, 10/15/23
4,000 Pennsylvania Housing Finance Agency, Single Family Mortgage 4/19 at 100.00 AA+ 3,865,840
Revenue Bonds, Tender Option Bond Trust 4657, 15.852%,
10/01/29 (IF)
3,000 Pennsylvania Turnpike Commission, Turnpike Revenue Bonds, 12/27 at 100.00 A2 1,891,680
Capital Appreciation Series 2009E, 0.000%, 12/01/30
------------------------------------------------------------------------------------------------------------------------------------
12,145 Total Pennsylvania 10,460,419
------------------------------------------------------------------------------------------------------------------------------------
PUERTO RICO - 1.5%
5,000 Puerto Rico Sales Tax Financing Corporation, Sales Tax 8/26 at 100.00 A+ 3,686,650
Revenue Bonds, First Subordinate Series 2009A, 0.000%,
8/01/32
------------------------------------------------------------------------------------------------------------------------------------
TENNESSEE - 1.0%
The Tennessee Energy Acquisition Corporation, Gas Revenue
Bonds, Series 2006A:
50 5.250%, 9/01/24 No Opt. Call BB+ 48,054
1,400 5.250%, 9/01/26 No Opt. Call BB+ 1,323,574
1,000 The Tennessee Energy Acquisition Corporation, Gas Revenue No Opt. Call BB+ 939,350
Bonds, Series 2006B, 5.625%, 9/01/26
155 The Tennessee Energy Acquisition Corporation, Gas Revenue No Opt. Call A 147,841
Bonds, Series 2006C, 5.000%, 2/01/24
------------------------------------------------------------------------------------------------------------------------------------
2,605 Total Tennessee 2,458,819
------------------------------------------------------------------------------------------------------------------------------------
TEXAS - 5.6%
3,000 La Vernia Higher Education Financing Corporation, Texas, 8/19 at 100.00 BBB 2,987,580
Charter School Revenue Bonds, Kipp Inc., Series 2009A,
6.250%, 8/15/39 (WI/DD, Settling 11/19/09)
2,000 Dallas-Ft. Worth International Airport Facility Improvement 11/12 at 100.00 CCC+ 1,197,100
Corporation, Texas, Revenue Bonds, American Airlines Inc.,
Series 2007, 5.500%, 11/01/30 (Alternative Minimum Tax)
3,000 Humble Independent School District, Harris County, Texas, 2/19 at 100.00 AA- 3,087,420
General Obligation Bonds, Series 2009, 5.000%, 2/15/34
1,225 Sabine River Authority, Texas, Pollution Control Revenue No Opt. Call CCC 1,104,497
Bonds, TXU Energy Company LLC Project, Series 2001B,
5.750%, 5/01/30 (Mandatory put 11/01/11) (Alternative
Minimum Tax)
1,205 Texas Municipal Gas Acquisition and Supply Corporation I, Gas No Opt. Call A 1,255,538
Supply Revenue Bonds, Senior Lien Series 2008D, 6.250%,
12/15/26
660 Texas Municipal Gas Acquisition and Supply Corporation I, Gas No Opt. Call A 632,023
Supply Revenue Bonds, Series 2006A, 5.250%, 12/15/23
20,000 Texas Turnpike Authority, Second Tier Revenue Bonds, Central 8/12 at 22.71 BBB+ 3,371,400
Texas Turnpike System, Series 2002, 0.000%, 8/15/37 -
AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
31,090 Total Texas 13,635,558
------------------------------------------------------------------------------------------------------------------------------------
Nuveen Investments 41
NEV | Nuveen Enhanced Municipal Value Fund (continued)
| Portfolio of Investments October 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
UTAH - 1.6%
$ 2,400 Riverton, Utah, Hospital Revenue Bonds, IHC Health Services, 8/19 at 100.00 AA+ $ 2,119,488
Inc., Tender Option Bonds Trust 3602, 0.000%, 8/15/41
(WI/DD, Settling 11/15/09) (IF)
1,490 Utah Transit Authority, Sales Tax Revenue Bonds, Tender No Opt. Call AAA 1,912,370
Option Bond Trust 11800, 21.862%, 6/15/35 - NPFG Insured
(IF)
------------------------------------------------------------------------------------------------------------------------------------
3,890 Total Utah 4,031,858
------------------------------------------------------------------------------------------------------------------------------------
VIRGINIA - 1.5%
105 Bedford County Industrial Development Authority, Virginia, 12/09 at 101.00 B2 100,796
Industrial Development Revenue Refunding Bonds, Nekoosa
Packaging Corporation, Series 1999, 6.300%, 12/01/25
(Alternative Minimum Tax) (4)
2,000 Giles County Industrial Development Authority, Virginia, 1/10 at 100.00 B+ 1,967,540
Exempt Facility Revenue Bonds, Hoechst Celanese Project,
Series 1996, 6.450%, 5/01/26 (WI/DD, Settling 11/02/09)
1,640 Virginia State Housing Development Authority, Rental Housing 4/19 at 100.00 AA+ 1,560,083
Revenue Bonds, Tender Option Bonds Trust 11799, 20.957%,
10/01/39 (IF)
------------------------------------------------------------------------------------------------------------------------------------
3,745 Total Virginia 3,628,419
------------------------------------------------------------------------------------------------------------------------------------
WASHINGTON - 0.8%
2,000 Washington State Higher Education Facilities Authority, 10/19 at 100.00 Baa1 1,966,780
Revenue Bonds, Whitworth University, Series 2009, 5.625%,
10/01/40 (WI/DD, Settling 11/04/09)
------------------------------------------------------------------------------------------------------------------------------------
WISCONSIN - 1.2%
1,375 Milwaukee Redevelopment Authority, Wisconsin, Schlitz Park 11/09 at 102.00 N/R 1,280,648
Mortgage Revenue Refunding Bonds, Series 1998A, 5.500%,
1/01/17 (Alternative Minimum Tax)
Wisconsin Health and Educational Facilities Authority,
Revenue Bonds, Froedtert Community Health, Inc. Obligated
Group, Tender Option Bond Trust 3592:
1,000 22.163%, 4/01/34 (IF) 4/19 at 100.00 AA- 809,050
1,000 23.414%, 4/01/39 (IF) 4/19 at 100.00 AA- 948,230
------------------------------------------------------------------------------------------------------------------------------------
3,375 Total Wisconsin 3,037,928
------------------------------------------------------------------------------------------------------------------------------------
$ 237,180 Total Investments (cost $216,882,094) - 84.3% 206,153,272
===============---------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 15.7% 38,404,956
------------------------------------------------------------------------------------------------------------------
Net Assets - 100% $ 244,558,228
==================================================================================================================
(1) All percentages shown in the Portfolio of Investments are based on net
assets.
(2) 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.
(3) Ratings (not covered by the report of independent registered public
accounting firm): Using the higher of Standard & Poor's Group ("Standard &
Poor's") or Moody's Investor Service, Inc. ("Moody's") rating. Ratings
below BBB by Standard & Poor's or Baa by Moody's are considered to be
below investment grade.
(4) The issuer has received a formal 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.
N/R Not rated.
WI/DD Purchased on a when-issued or delayed delivery basis.
(IF) Inverse floating rate investment.
See accompanying notes to financial statements.
42 Nuveen Investments
| Statement of
| Assets & Liabilities October 31, 2009
ENHANCED
MUNICIPAL VALUE MUNICIPAL VALUE 2 MUNICIPAL INCOME MUNICIPAL VALUE
(NUV) (NUW) (NMI) (NEV)
-----------------------------------------------------------------------------------------------------------------------
ASSETS
Investments, at value (cost $1,865,922,627,
$178,424,376, $85,406,630 and
$216,882,094, respectively) $ 1,877,149,851 $ 202,840,884 $ 86,329,270 $ 206,153,272
Cash 1,153,949 -- 721,457 69,760,266
Receivables:
Interest 29,565,205 3,758,374 1,515,127 3,781,668
Investments sold 10,285,000 396,407 65,000 --
Other assets 130,074 992 2,300 --
-----------------------------------------------------------------------------------------------------------------------
Total assets 1,918,284,079 206,996,657 88,633,154 279,695,206
-----------------------------------------------------------------------------------------------------------------------
LIABILITIES
Floating rate obligations 38,250,000 -- 3,335,000 --
Cash overdraft -- 483,617 -- --
Payables:
Investments purchased 50,640 -- -- 34,877,157
Dividends 6,364,467 644,362 326,957 --
Accrued expenses:
Management fees 863,634 109,053 46,763 189,187
Offering costs -- 7,000 -- 15,000
Other 724,003 43,967 41,373 55,634
-----------------------------------------------------------------------------------------------------------------------
Total liabilities 46,252,744 1,287,999 3,750,093 35,136,978
-----------------------------------------------------------------------------------------------------------------------
Net assets $ 1,872,031,335 $ 205,708,658 $ 84,883,061 $ 244,558,228
=======================================================================================================================
Shares outstanding 196,857,720 12,696,479 8,176,351 17,807,000
=======================================================================================================================
Net asset value per share outstanding $ 9.51 $ 16.20 $ 10.38 $ 13.73
=======================================================================================================================
NET ASSETS CONSIST OF:
-----------------------------------------------------------------------------------------------------------------------
Shares, $.01 par value per share $ 1,968,577 $ 126,965 $ 81,764 $ 178,070
Paid-in surplus 1,855,172,802 181,429,417 91,455,932 254,373,205
Undistributed (Over-distribution of) net
investment income 6,984,529 (387,244) 823,990 718,295
Accumulated net realized gain (loss) from
investments and derivative transactions (3,321,797) 123,012 (8,401,265) 17,480
Net unrealized appreciation (depreciation)
of investments 11,227,224 24,416,508 922,640 (10,728,822)
-----------------------------------------------------------------------------------------------------------------------
Net assets $ 1,872,031,335 $ 205,708,658 $ 84,883,061 $ 244,558,228
=======================================================================================================================
Authorized shares 350,000,000 Unlimited 200,000,000 Unlimited
=======================================================================================================================
See accompanying notes to financial statements.
Nuveen Investments 43
| Statement of
| Operations Year Ended October 31, 2009
ENHANCED
MUNICIPAL VALUE MUNICIPAL VALUE 2 MUNICIPAL INCOME MUNICIPAL VALUE
(NUV) (NUW)* (NMI) (NEV)**
------------------------------------------------------------------------------------------------------------------------------------
INVESTMENT INCOME $ 108,176,752 $ 7,131,308 $ 5,288,011 $ 971,474
------------------------------------------------------------------------------------------------------------------------------------
EXPENSES
Management fees 9,918,824 789,096 513,839 197,544
Shareholders' servicing agent fees and expenses 349,165 90 18,287 9
Interest expense on floating rate obligations 301,308 -- 24,841 --
Custodian's fees and expenses 288,217 25,156 21,506 4,204
Directors'/Trustees' fees and expenses 55,361 4,560 2,533 715
Professional fees 106,538 16,482 11,779 10,043
Shareholders' reports - printing and mailing
expenses 378,277 19,208 27,324 20,598
Stock exchange listing fees 69,807 -- 9,299 --
Investor relations expense 113,162 12,659 7,336 2,653
Other expenses 63,177 3,340 6,797 17,413
------------------------------------------------------------------------------------------------------------------------------------
Total expenses before custodian fee credit 11,643,836 870,591 643,541 253,179
Custodian fee credit (8,867) (1,418) (1,801) --
------------------------------------------------------------------------------------------------------------------------------------
Net expenses 11,634,969 869,173 641,740 253,179
------------------------------------------------------------------------------------------------------------------------------------
Net investment income 96,541,783 6,262,135 4,646,271 718,295
------------------------------------------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) from:
Investments 29,365 123,012 (587,919) 17,480
Futures -- -- 196,281 --
Change in net unrealized appreciation
(depreciation) of:
Investments 173,519,317 24,416,508 8,919,687 (10,728,822)
Futures -- -- 100,144 --
------------------------------------------------------------------------------------------------------------------------------------
Net realized and unrealized gain (loss) 173,548,682 24,539,520 8,628,193 (10,711,342)
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets from
operations $ 270,090,465 $ 30,801,655 $ 13,274,464 $ (9,993,047)
====================================================================================================================================
* For the period February 25, 2009 (commencement of operations) through
October 31, 2009.
** For the period September 25, 2009 (commencement of operations) through
October 31, 2009.
See accompanying notes to financial statements.
44 Nuveen Investments
| Statement of
| Changes in Net Assets
MUNICIPAL VALUE (NUV) MUNICIPAL VALUE 2 (NUW)
---------------------------------- ---------------------------
FOR THE PERIOD 2/25/09
YEAR ENDED YEAR ENDED (COMMENCEMENT OF OPERATIONS)
10/31/09 10/31/08 THROUGH 10/31/09
------------------------------------------------------------------------------------------------------------------------------
OPERATIONS
Net investment income $ 96,541,783 $ 92,078,698 $ 6,262,135
Net realized gain (loss) from:
Investments 29,365 (3,904,828) 123,012
Futures -- -- --
Change in net unrealized appreciation (depreciation) of:
Investments 173,519,317 (287,804,822) 24,416,508
Futures -- -- --
------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets from operations 270,090,465 (199,630,952) 30,801,655
------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income (92,292,691) (91,737,819) (6,649,379)
From accumulated net realized gains -- (5,519,843) --
------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets from distributions to shareholders (92,292,691) (97,257,662) (6,649,379)
------------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS
Proceeds from sale at shares, net of offering costs -- -- 180,117,000
Net proceeds from shares issued to shareholders due to
reinvestment of distributions 9,815,879 6,771,749 1,339,107
------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets from capital
share transactions 9,815,879 6,771,749 181,456,107
------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets 187,613,653 (290,116,865) 205,608,383
Net assets at the beginning of period 1,684,417,682 1,974,534,547 100,275
------------------------------------------------------------------------------------------------------------------------------
Net assets at the end of period $ 1,872,031,335 $ 1,684,417,682 $ 205,708,658
==============================================================================================================================
Undistributed (Over-distribution of) net investment
income at the end of period $ 6,984,529 $ 2,924,085 $ (387,244)
==============================================================================================================================
See accompanying notes to financial statements.
Nuveen Investments 45
| Statement of
| Changes in Net Assets (continued)
ENHANCED MUNICIPAL
MUNICIPAL INCOME (NMI) VALUE (NEV)
------------------------------ ---------------------------
FOR THE PERIOD 9/25/09
YEAR ENDED YEAR ENDED (COMMENCEMENT OF OPERATIONS)
10/31/09 10/31/08 THROUGH 10/31/09
--------------------------------------------------------------------------------------------------------------------------
OPERATIONS
Net investment income $ 4,646,271 $ 4,315,417 $ 718,295
Net realized gain (loss) from:
Investments (587,919) (120,921) 17,480
Futures 196,281 56,305 --
Change in net unrealized appreciation (depreciation) of:
Investments 8,919,687 (12,150,685) (10,728,822)
Futures 100,144 (100,144) --
--------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets from operations 13,274,464 (8,000,028) (9,993,047)
--------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income (4,316,357) (4,095,547) --
From accumulated net realized gains -- -- --
--------------------------------------------------------------------------------------------------------------------------
Decrease in net assets from distributions to shareholders (4,316,357) (4,095,547) --
--------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS
Proceeds from sale at shares, net of offering costs -- -- 254,451,000
Net proceeds from shares issued
to shareholders due to
reinvestment of distributions 371,854 224,555 --
--------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets
from capital share transactions 371,854 224,555 254,451,000
--------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets 9,329,961 (11,871,020) 244,457,953
Net assets at the beginning of period 75,553,100 87,424,120 100,275
--------------------------------------------------------------------------------------------------------------------------
Net assets at the end of period $ 84,883,061 $ 75,553,100 $ 244,558,228
==========================================================================================================================
Undistributed (Over-distribution of)
net investment income at the end of period $ 823,990 $ 498,768 $ 718,295
==========================================================================================================================
See accompanying notes to financial statements.
46 Nuveen Investments
| Notes to
| Financial Statements
1. GENERAL INFORMATION AND SIGNIFICANT ACCOUNTING POLICIES
The funds covered in this report and their corresponding New York Stock Exchange
symbols are Nuveen Municipal Value Fund, Inc. (NUV), Nuveen Municipal Value Fund
2 (NUW), Nuveen Municipal Income Fund, Inc. (NMI) and Nuveen Enhanced Municipal
Value Fund (NEV) (collectively, the "Funds"). The Funds are registered under the
Investment Company Act of 1940, as amended, as closed-end, management investment
companies.
Prior to the commencement of operations, Municipal Value 2 (NUW) and Enhanced
Municipal Value (NEV) had no operations other than those related to
organizational matters, the initial capital contribution for each Fund of
$100,275 by Nuveen Asset Management (the "Advisor"), a wholly owned subsidiary
of Nuveen Investments, Inc. ("Nuveen"), and the recording of each Fund's
organization expense ($15,000) and their reimbursement by Nuveen Investments,
LLC, also a wholly owned subsidiary of Nuveen.
Each Fund's primary investment objective is to provide current income exempt
from regular federal income tax by investing primarily in a portfolio of
municipal obligations issued by state and local government authorities or
certain US territories.
In June 2009, the Financial Accounting Standards Board (FASB) established the
FASB Accounting Standards Codification(TM) (the "Codification") as the single
source of authoritative accounting principles recognized by the FASB in the
preparation of financial statements in conformity with generally accepted
accounting principles (GAAP). The Codification supersedes existing
non-grandfathered, non-SEC accounting and reporting standards. The Codification
did not change GAAP but rather organized it into a hierarchy where all guidance
within the Codification carries an equal level of authority. The Codification
became effective for financial statements issued for interim and annual periods
ending after September 15, 2009. The Codification did not have a material effect
on the Funds' financial statements.
The following is a summary of significant accounting policies followed by the
Funds in the preparation of their financial statements in accordance with US
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/Trustees. Futures
contracts are valued using the closing settlement price, or in the absence of
such a price, at the mean of the bid and asked prices. When market price quotes
are not readily available (which is usually the case for municipal securities),
the pricing service or, in absence of a pricing service for a particular
investment or derivative instrument, the Board of Directors/Trustees of the
Fund, or its designee, may establish fair value using a wide variety of market
data including yields or prices of investments 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. Temporary investments in securities
that have variable rate and demand features qualifying them as short-term
investments are valued at amortized cost, which approximates 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/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/delayed delivery purchase commitments. At October 31, 2009, Enhanced
Municipal Value (NEV) had outstanding when-issued/delayed delivery purchase
commitments of $32,632,106. There were no such outstanding purchase commitments
in any of the other Funds.
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.
Income Taxes
Each Fund is a separate taxpayer for federal income tax purposes. Each Fund
intends to distribute substantially all of its 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
Nuveen Investments 47
| Notes to
| Financial Statements (continued)
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. Net realized capital gains and ordinary income distributions paid by the
Funds are subject to federal taxation.
For all open tax years and all major taxing jurisdictions, management of the
Funds has concluded that there are no significant uncertain tax positions that
would require recognition in the financial statements. Open tax years are those
that are open for examination by taxing authorities (i.e., generally the last
four tax year ends and the interim tax period since then). Furthermore,
management of the Funds is also not aware of any tax positions for which it is
reasonably possible that the total amounts of unrecognized tax benefits will
significantly change in the next twelve months.
Dividends and Distributions to 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 at least annually. Furthermore, capital
gains are distributed only to the extent they exceed available capital loss
carryforwards.
Distributions to 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 US generally accepted
accounting principles.
Inverse Floating Rate Securities
Each Fund is authorized to invest in inverse floating rate securities. An
inverse floating rate security is created by depositing a municipal bond,
typically with a fixed interest rate, into a special purpose trust created by a
broker-dealer. In turn, this trust (a) issues floating rate certificates, in
face amounts equal to some fraction of the deposited bond's par amount or market
value, that typically pay short-term tax-exempt interest rates to third parties,
and (b) issues to a long-term investor (such as one of the Funds) an inverse
floating rate certificate (sometimes referred to as an "inverse floater") that
represents all remaining or residual interest in the trust. The income received
by the inverse floater holder varies inversely with the short-term rate paid to
the floating rate certificates' holders, and in most circumstances the inverse
floater holder bears substantially all of the underlying bond's downside
investment risk and also benefits disproportionately from any potential
appreciation of the underlying bond's value. The price of an inverse floating
rate security will be more volatile than that of the underlying bond because the
interest rate is dependent on not only the fixed coupon rate of the underlying
bond but also on the short-term interest paid on the floating rate certificates,
and because the inverse floating rate security essentially bears the risk of
loss of the greater face value of the underlying bond.
A Fund may purchase an inverse floating rate security in a secondary market
transaction without first owning the underlying bond (referred to as an
"externally-deposited inverse floater"), or instead by first selling a
fixed-rate bond to a broker-dealer for deposit into the special purpose trust
and receiving in turn the residual interest in the trust (referred to as a
"self-deposited inverse floater"). The inverse floater held by a Fund gives the
Fund the right (a) to cause the holders of the floating rate certificates to
tender their notes at par, and (b) to have the broker transfer the fixed-rate
bond held by the trust to the Fund, thereby collapsing the trust. An investment
in an externally-deposited inverse floater is identified in the Portfolio of
Investments as "(IF) - Inverse floating rate investment." An investment in a
self-deposited inverse floater is accounted for as a financing transaction. In
such instances, a fixed-rate bond deposited into a special purpose trust is
identified in the Portfolio of Investments as "(UB) - Underlying bond of an
inverse floating rate trust reflected as a financing transaction," with the Fund
accounting for the short-term floating rate certificates issued by the trust as
"Floating rate obligations" on the Statement of Assets and Liabilities. In
addition, the Fund reflects in "Investment Income" the entire earnings of the
underlying bond and recognizes the related interest paid to the holders of the
short-term floating rate certificates as "Interest expense on floating rate
obligations" on the Statement of Operations.
During the fiscal year ended October 31, 2009, Municipal Value (NUV) and
Municipal Income (NMI) invested in externally-deposited inverse floaters and/or
self-deposited inverse floaters. During the period February 25, 2009
(commencement of operations) through October 31, 2009, Municipal Value 2 (NUW)
invested in externally-deposited inverse floaters. During the period September
25, 2009 (commencement of operations) through October 31, 2009, Enhanced
Municipal Value (NEV) invested in externally-deposited inverse floaters.
Each Fund may also enter into shortfall and forbearance agreements (sometimes
referred to as a "recourse trust" or "credit recovery swap") (such agreements
referred to herein as "Recourse Trusts") with a broker-dealer by which a Fund
agrees to reimburse the broker-dealer, in certain circumstances, for the
difference between the liquidation value of the fixed-rate bond held by the
trust and the liquidation value of the floating rate certificates issued by the
trust plus any shortfalls in interest cash flows. Under these agreements, a
Fund's potential exposure to losses related to or on inverse floaters may
increase beyond the value of a Fund's inverse floater investments as a Fund may
potentially be liable to fulfill all amounts owed to holders of the floating
rate certificates. At period end, any such shortfall is included as "Unrealized
depreciation on Recourse Trusts" on the Statement of Assets and Liabilities.
At October 31, 2009, each Fund's maximum exposure to externally-deposited
Recourse Trusts is as follows:
ENHANCED
MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL
VALUE (NUV) VALUE 2 (NUW) INCOME (NMI) VALUE (NEV)
-----------------------------------------------------------------------------------------------
Maximum exposure to Recourse Trusts $ 7,500,000 $ 8,665,000 $ 3,005,000 $ 134,065,000
===============================================================================================
48 Nuveen Investments
The average floating rate obligations outstanding and average annual interest
rate and fees related to self-deposited inverse floaters during the fiscal year
ended October 31, 2009, were as follows:
MUNICIPAL MUNICIPAL
VALUE (NUV) INCOME (NMI)
-------------------------------------------------------------------------------
Average floating rate obligations outstanding $38,250,000 $ 3,335,000
Average annual interest rate and fees 0.79% 0.74%
===============================================================================
Futures Contracts
Each Fund is subject to interest rate risk in the normal course of pursuing its
investment objectives and is authorized to invest in futures contracts in
attempt to manage such risk. Upon entering into a futures contract, a Fund is
required to deposit with the broker an amount of cash or liquid securities equal
to a specified percentage of the contract amount. This is known as the "initial
margin." Cash held by the broker to cover initial margin requirements on open
futures contracts, if any, is recognized as "Deposits with brokers for open
futures contracts" on the Statement of Assets and Liabilities. Subsequent
payments ("variation margin") are made or received by a Fund each day, depending
on the daily fluctuation of the value of the contract. Variation margin is
recognized as a receivable or payable for "Variation margin on futures
contracts" on the Statement of Assets and Liabilities, when applicable.
During the period the futures contract is open, changes in the value of the
contract are recorded as an unrealized gain or loss by "marking-to-market" on a
daily basis to reflect the changes in market value of the contract and is
recognized as "Change in net unrealized appreciation (depreciation) of futures
contracts" on the Statement of Operations. When the contract is closed or
expired, a Fund records a realized gain or loss equal to the difference between
the value of the contract on the closing date and value of the contract when
originally entered into and is recognized as "Net realized gain (loss) from
futures contracts" on the Statement of Operations. Municipal Income (NMI)
invested in futures contracts during the fiscal year ended October 31, 2009.
Risks of investments in futures contracts include the possible adverse movement
of the securities or indices underlying the contracts, the possibility that
there may not be a liquid secondary market for the contracts and/or that a
change in the value of the contract may not correlate with a change in the value
of the underlying securities or indices.
The average number of futures contracts outstanding during the fiscal year ended
October 31, 2009, was as follows:
MUNICIPAL
INCOME (NMI)
--------------------------------------------------------------------------------
Average number of futures contracts outstanding 5*
================================================================================
* The average number of contracts is calculated based on the outstanding
contracts at the beginning of the fiscal year and at the end of each
fiscal quarter within the current fiscal year. The Fund was not invested
in futures contracts at the end of the current fiscal year.
Refer to Footnote 3 - Derivative Instruments and Hedging Activities for further
details on futures contract activity.
Market and Counterparty Credit Risk
In the normal course of business each Fund may invest in financial instruments
and enter into financial transactions where risk of potential loss exists due to
changes in the market (market risk) or failure of the other party to the
transaction to perform (counterparty credit risk). The potential loss could
exceed the value of the financial assets recorded on the financial statements.
Financial assets, which potentially expose each Fund to counterparty credit
risk, consist principally of cash due from counterparties on forward, option and
swap transactions. The extent of each Fund's exposure to counterparty credit
risk in respect to these financial assets approximates their carrying value as
recorded on the Statement of Assets and Liabilities. Futures contracts expose a
Fund to minimal counterparty credit risk as they are exchange traded and the
exchange's clearinghouse, which is counterparty to all exchange traded futures,
guarantees the futures contracts against default.
Each Fund helps manage counterparty credit risk by entering into agreements only
with counterparties the Adviser believes have the financial resources to honor
their obligations and by having the Adviser monitor the financial stability of
the counterparties. Additionally, counterparties may be required to pledge
collateral daily (based on the daily valuation of the financial asset) on behalf
of each Fund with a value approximately equal to the amount of any unrealized
gain above a pre-determined threshold. Reciprocally, when each Fund has an
unrealized loss, the Funds have instructed the custodian to pledge assets of the
Funds as collateral with a value approximately equal to the amount of the
unrealized loss above a pre-determined threshold. Collateral pledges are
monitored and subsequently adjusted if and when the valuations fluctuate, either
up or down, by at least the predetermined threshold amount.
Nuveen Investments 49
| Notes to
| Financial Statements (continued)
Zero Coupon Securities
Each Fund is authorized to invest in zero coupon securities. A zero coupon
security does not pay a regular interest coupon to its holders during the life
of the security. Tax-exempt income to the holder of the security comes from
accretion of the difference between the original purchase price of the security
at issuance and the par value of the security at maturity and is effectively
paid at maturity. Such securities are included in the Portfolios of Investments
with a 0.000% coupon rate in their description. The market prices of zero coupon
securities generally are more volatile than the market prices of securities that
pay interest periodically.
Organization and Offering Costs
Nuveen Investments, LLC has agreed to reimburse all organization expenses
($15,000) and pay all offering costs (other than the sales load) that exceed
$.03 per share of each Municipal Value 2's (NUW) and Enhanced Municipal Value's
(NEV) shares. Municipal Value 2's (NUW) and Enhanced Municipal Value's (NEV)
share offering costs ($378,000 and $534,000, respectively) were recorded as
reductions of the proceeds from each Fund's sale of shares.
Custodian Fee Credit
Each Fund has an arrangement with the custodian bank whereby certain custodian
fees and expenses are reduced by net credits earned on each Fund's cash on
deposit with the bank. Such deposit arrangements are an alternative to overnight
investments. Credits for cash balances may be offset by charges for any days on
which a Fund overdraws its account at the custodian bank.
Indemnifications
Under the Funds' organizational documents, their Officers and Directors/Trustees
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 US 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 from operations during the reporting period. Actual results may differ
from those estimates.
2. FAIR VALUE MEASUREMENTS
During the current fiscal period, the Funds adopted authoritative guidance under
GAAP on determining fair value measurements. This guidance defines fair value,
establishes a framework for measuring fair value in GAAP and expands disclosure
about fair value measurements. In determining the value of each Fund's
investments various inputs are used. These inputs are summarized in the three
broad levels listed below:
Level 1 - Quoted prices in active markets for identical securities.
Level 2 - Other significant observable inputs (including quoted prices for
similar securities, interest rates, prepayment speeds, credit risk, etc.).
Level 3 - Significant unobservable inputs (including management's
assumptions in determining the fair value of investments).
The inputs or methodology used for valuing securities are not an indication of
the risk associated with investing in those securities. The following is a
summary of each Fund's fair value measurements as of October 31, 2009:
MUNICIPAL VALUE (NUV) LEVEL 1 LEVEL 2 LEVEL 3 TOTAL
----------------------------------------------------------------------------------------
Investments:
Municipal Bonds $ -- $ 1,877,149,851 $ -- $ 1,877,149,851
========================================================================================
MUNICIPAL VALUE 2 (NUW) LEVEL 1 LEVEL 2 LEVEL 3 TOTAL
----------------------------------------------------------------------------------------
Investments:
Municipal Bonds $ -- $ 202,840,884 $ -- $ 202,840,884
========================================================================================
MUNICIPAL INCOME (NMI) LEVEL 1 LEVEL 2 LEVEL 3 TOTAL
----------------------------------------------------------------------------------------
Investments:
Municipal Bonds $ -- $ 86,329,270 $ -- $ 86,329,270
========================================================================================
ENHANCED MUNICIPAL VALUE (NEV) LEVEL 1 LEVEL 2 LEVEL 3 TOTAL
----------------------------------------------------------------------------------------
Investments:
Municipal Bonds $ -- $ 206,153,272 $ -- $ 206,153,272
========================================================================================
50 Nuveen Investments
3. DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES
During the current fiscal period, the Funds adopted amendments to authoritative
guidance under GAAP on disclosures about derivative instruments and hedging
activities. This guidance is intended to enhance financial statement disclosures
for derivative instruments and hedging activities and enable investors to better
understand: a) how and why a fund uses derivative instruments; b) how derivative
instruments are accounted for; and c) how derivative instruments affect a fund's
financial position, results of operations and cash flows, if any. The Funds
record derivative instruments at fair value with changes in fair value
recognized on the Statement of Operations, when applicable. Even though the
Funds' investments in derivatives may represent economic hedges, under this
guidance they are considered to be non-hedge transactions for financial
reporting purposes. For additional information on the derivative instruments in
which each Fund was invested during and at the end of the reporting period,
refer to the Portfolio of Investments, Financial Statements and Footnote 1 -
General Information and Significant Accounting Policies.
The following tables presents the amount of net realized gain (loss) and change
in net unrealized appreciation (depreciation) recognized for the fiscal year
ended October 31, 2009, on derivative instruments, as well as the primary risk
exposure associated with each. Municipal Income (NMI) held derivative
instruments during the fiscal year ended October 31, 2009. None of the Funds had
derivative contracts outstanding at October 31, 2009.
MUNICIPAL
NET REALIZED GAIN (LOSS) FROM FUTURES CONTRACTS INCOME (NMI)
--------------------------------------------------------------------------------
RISK EXPOSURE
Interest Rate $ 196,281
================================================================================
CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) MUNICIPAL
OF FUTURES CONTRACTS INCOME (NMI)
--------------------------------------------------------------------------------
RISK EXPOSURE
Interest Rate $ 100,144
================================================================================
4. FUND SHARES
Municipal Value (NUV) and Municipal Income (NMI) did not repurchase any of their
outstanding shares during the fiscal years ended October 31, 2009 and October
31, 2008. Municipal Value 2 (NUW) and Enhanced Municipal Value (NEV) did not
repurchase any of their shares during the period since commencement of
operations through October 31, 2009.
Transactions in shares were as follows:
MUNICIPAL VALUE (NUV) MUNICIPAL VALUE 2 (NUW)
---------------------- ---------------------------
YEAR YEAR FOR THE PERIOD 2/25/09
ENDED ENDED (COMMENCEMENT OF OPERATIONS)
10/31/09 10/31/08 THROUGH 10/31/09
-----------------------------------------------------------------------------------------------
Shares sold -- -- 12,600,000
Shares issued to shareholders
due to reinvestment of distributions 1,101,278 709,000 89,479
===============================================================================================
ENHANCED MUNICIPAL
MUNICIPAL INCOME (NMI) VALUE (NEV)
---------------------- ---------------------------
YEAR YEAR FOR THE PERIOD 9/25/09
ENDED ENDED (COMMENCEMENT OF OPERATIONS)
10/31/09 10/31/08 THROUGH 10/31/09
-----------------------------------------------------------------------------------------------
Shares sold -- -- 17,800,000
Shares issued to shareholders
due to reinvestment of distributions 38,222 21,474 --
===============================================================================================
5. INVESTMENT TRANSACTIONS
Purchases and sales (including maturities but excluding short-term investments
and derivative transactions) during the fiscal year ended October 31, 2009, were
as follows:
ENHANCED
MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL
VALUE (NUV) VALUE 2 (NUW)* INCOME (NMI) VALUE (NEV)**
---------------------------------------------------------------------------------------
Purchases $ 103,929,269 $ 181,597,372 $ 8,077,712 $ 217,864,784
Sales and maturities 85,859,409 4,331,405 7,976,845 997,000
=======================================================================================
* For the period February 25, 2009 (commencement of operations) through
October 31, 2009.
** For the period September 25, 2009 (commencement of operations) through
October 31, 2009.
Nuveen Investments 51
| Notes to
| Financial Statements (continued)
6. 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 timing differences in recognizing taxable market discount,
timing differences in recognizing certain gains and losses on investments
transactions and the treatment of investments in inverse floating rate
securities reflected as financing transactions, if any. To the extent that
differences arise that are permanent in nature, such amounts are reclassified
within the capital accounts on the Statement of Assets and Liabilities presented
in the annual report, based on their federal tax basis treatment; temporary
differences do not require reclassification. Temporary and permanent differences
do not impact the net asset values of the Funds.
At October 31, 2009, the cost of investments was as follows:
ENHANCED
MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL
VALUE (NUV) VALUE 2 (NUW) INCOME (NMI) VALUE (NEV)
----------------------------------------------------------------------------------------------------------------------------
Cost of investments $ 1,827,449,234 $ 178,230,436 $ 81,929,183 $ 216,875,175
============================================================================================================================
Gross unrealized appreciation and gross unrealized depreciation of investments
at October 31, 2009, were as follows:
ENHANCED
MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL
VALUE (NUV) VALUE 2 (NUW) INCOME (NMI) VALUE (NEV)
----------------------------------------------------------------------------------------------------------------------------
Gross unrealized:
Appreciation $ 111,949,023 $ 24,610,448 $ 4,206,388 $ 192,600
Depreciation (100,498,052) -- (3,142,369) (10,914,503)
----------------------------------------------------------------------------------------------------------------------------
Net unrealized appreciation (depreciation) of
investments $ 11,450,971 $ 24,610,448 $ 1,064,019 $ (10,721,903)
============================================================================================================================
The tax components of undistributed net tax-exempt income, net ordinary income
and net long-term capital gains at October 31, 2009, the Funds' tax year end,
were as follows:
ENHANCED
MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL
VALUE (NUV) VALUE 2 (NUW) INCOME (NMI) VALUE (NEV)
----------------------------------------------------------------------------------------------------------------------------
Undistributed net tax-exempt income * $ 9,742,098 $ 371,049 $ 1,062,247 $ 711,376
Undistributed net ordinary income ** 374,056 123,015 4,652 17,480
Undistributed net long-term capital gains 1,000,286 -- -- --
============================================================================================================================
* Undistributed net tax-exempt income (on a tax basis) has not been reduced
for the dividend declared on October 1, 2009, paid on November 2, 2009.
** 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 Funds' tax years ended
October 31, 2009 and October 31, 2008, was designated for purposes of the
dividends paid deduction as follows:
ENHANCED
MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL
2009 VALUE (NUV) VALUE 2 (NUW)***** INCOME (NMI) VALUE (NEV)******
----------------------------------------------------------------------------------------------------------------------------
Distributions from net tax-exempt income*** $ 91,855,449 $ 5,697,143 $ 4,273,870 $ --
Distributions from net ordinary income ** 394,292 -- -- --
Distributions from net long-term capital gains**** -- -- -- --
============================================================================================================================
MUNICIPAL MUNICIPAL
2008 VALUE (NUV) INCOME (NMI)
----------------------------------------------------------------------------------------------------------------------------
Distributions from net tax-exempt income $ 91,392,283 $ 4,094,646
Distributions from net ordinary income ** 333,473 --
Distributions from net long-term capital gains 5,504,256 --
============================================================================================================================
** Net ordinary income consists of taxable market discount income and net
short-term capital gains, if any.
*** The Funds hereby designate these amounts paid during the fiscal year
ended October 31, 2009, as Exempt Interest Dividends.
**** The Funds designated as a long-term capital gain dividend, pursuant to
the Internal Revenue Code Section 852(b)(3), the amount necessary to
reduce earnings and profits of the Funds related to net capital gain to
zero for the tax year ended October 31, 2009.
***** For the period February 25, 2009 (commencement of operations) through
October 31, 2009.
****** For the period September 25, 2009 (commencement of operations) through
October 31, 2009.
52 Nuveen Investments
At October 31, 2009, the Fund's tax year end, Municipal Income (NMI) 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:
MUNICIPAL
INCOME (NMI)
--------------------------------------------------------------------------------
Expiration:
October 31, 2011 $ 6,864,744
October 31, 2012 916,759
October 31, 2013 165,764
October 31, 2016 164,175
October 31, 2017 289,822
--------------------------------------------------------------------------------
Total $ 8,401,264
================================================================================
7. MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES
Each Fund's management fee is separated into 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, and for Municipal Value (NUV) a gross interest
income component. 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.
Municipal Value's (NUV) annual fund-level fee, payable monthly, is based upon
the average daily net assets of the Fund as follows:
MUNICIPAL VALUE (NUV)
AVERAGE DAILY NET ASSETS (1) FUND-LEVEL FEE RATE
--------------------------------------------------------------------------------
For the first $500 million .1500%
For the next $500 million .1250
For net assets over $1 billion .1000
================================================================================
In addition, Municipal Value (NUV) pays an annual management fee, payable
monthly, based on gross interest income (excluding interest on bonds underlying
a "self-deposited inverse floater" trust that is attributed to the Fund over and
above the net interest earned on the inverse floater itself) as follows:
MUNICIPAL VALUE (NUV)
GROSS INTEREST INCOME GROSS INCOME FEE RATE
--------------------------------------------------------------------------------
For the first $50 million 4.125%
For the next $50 million 4.000
For gross income over $100 million 3.875
================================================================================
Municipal Value 2's (NUW) annual fund-level fee, payable monthly, is based upon
the average daily managed net assets of the Fund as follows:
MUNICIPAL VALUE 2 (NUW)
AVERAGE DAILY MANAGED NET ASSETS (1) FUND-LEVEL FEE RATE
--------------------------------------------------------------------------------
For the first $125 million .4000%
For the next $125 million .3875
For the next $250 million .3750
For the next $500 million .3625
For the next $1 billion .3500
For net assets over $2 billion .3375
================================================================================
Nuveen Investments 53
| Notes to
| Financial Statements (continued)
Municipal Income's (NMI) annual fund-level fee, payable monthly, is based upon
the average daily net assets of the Fund as follows:
MUNICIPAL INCOME (NMI)
AVERAGE DAILY NET ASSETS (1) 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
================================================================================
Enhanced Municipal Value's (NEV) annual fund-level fee, payable monthly, is
based upon the average daily managed net assets of the Fund as follows:
ENHANCED MUNICIPAL VALUE (NEV)
AVERAGE DAILY MANAGED NET ASSETS (1) 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 net assets over $2 billion .3875
================================================================================
The annual complex-level fee, payable monthly, which is additive to the
fund-level fee and Municipal Value's (NUV) gross interest income fee, for all
Nuveen sponsored funds in the U.S., is based on the aggregate amount of total
fund net assets managed as stated in the following table. As of October 31,
2009, the complex-level fee rate was .1907%.
The complex-level fee schedule is as follows:
COMPLEX-LEVEL NET ASSET BREAKPOINT
LEVEL (1) EFFECTIVE RATE AT BREAKPOINT LEVEL
--------------------------------------------------------------------------------
$55 billion .2000%
$56 billion .1996
$57 billion .1989
$60 billion .1961
$63 billion .1931
$66 billion .1900
$71 billion .1851
$76 billion .1806
$80 billion .1773
$91 billion .1691
$125 billion .1599
$200 billion .1505
$250 billion .1469
$300 billion .1445
================================================================================
(1) The complex-level fee component of the management fee for the funds is
calculated based upon the aggregate daily managed net assets of all
Nuveen funds, with such daily managed net assets defined separately for
each fund in its management agreement, but excluding assets
attributable to investments in other Nuveen funds. For the
complex-level and fund-level fee components, daily managed net assets
includes assets managed by the Adviser that are attributable to each
fund's use of financial leverage. For these purposes, financial
leverage includes the funds' use of preferred stock and borrowings and
investments in the residual interest certificates (also called inverse
floating rate securities) in tender option bond (TOB) trusts, including
the portion of assets held by the TOB trust that has been effectively
financed by the trust's issuance of floating rate securities, subject
to an agreement by the Adviser to limit the amount of such assets for
determining managed net assets in certain circumstances.
The management fee compensates the Adviser for overall investment advisory and
administrative services and general office facilities. The Funds pay no
compensation directly to those of its Directors/Trustees who are affiliated with
the Adviser or to its Officers, all of whom receive remuneration for their
services to the Funds from the Adviser or its affiliates. The Board of
Directors/Trustees has adopted a deferred compensation plan for independent
Directors/Trustees that enables Directors/Trustees 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.
54 Nuveen Investments
8. NEW ACCOUNTING STANDARDS
Accounting for Transfers of Financial Assets
During June 2009, the FASB issued changes to the authoritative guidance under
GAAP on accounting for transfers of financial assets. The objective of this
guidance is to improve the relevance, representational faithfulness, and
comparability of the information that a reporting entity provides in its
financial statements about a transfer of financial assets; the effects of a
transfer on its financial position, financial performance, and cash flows; and a
transferor's continuing involvement, if any, in transferred financial assets.
This guidance is effective as of the beginning of each reporting entity's first
annual reporting period that begins after November 15, 2009, for interim periods
within that first annual reporting period and for interim and annual reporting
periods thereafter. Earlier application is prohibited. The recognition and
measurement provisions of this guidance must be applied to transfers occurring
on or after the effective date. Additionally, the disclosure provisions of this
guidance should be applied to transfers that occurred both before and after the
effective date of this guidance. At this time, management is evaluating the
implications of this guidance and the impact it will have on the financial
statement amounts and disclosures, if any.
9. SUBSEQUENT EVENTS
Distributions to Shareholders
The Funds declared dividend distributions from their tax-exempt net investment
income which were paid on December 1, 2009, to shareholders of record on
November 15, 2009, as follows:
ENHANCED
MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL
VALUE (NUV) VALUE 2 (NUW) INCOME (NMI) VALUE (NEV)
--------------------------------------------------------------------------------
Dividend per share $ .0390 $ .0750 $ .0470 $ .0760
================================================================================
Shares Sold
On November 5, 2009, Enhanced Municipal Value (NEV) sold and additional
1,400,000 shares.
Evaluation Date
In May 2009, the FASB issued changes to authoritative guidance under GAAP for
subsequent events. This guidance requires an entity to recognize in the
financial statements the effects of all subsequent events that provide
additional evidence about conditions that existed at the date of the balance
sheet. This guidance is intended to establish general standards of accounting
and for disclosure of events that occur after the balance sheet date but before
financial statements are issued or are available to be issued. This guidance
requires the disclosure of the date through which an entity has evaluated
subsequent events and the basis for that date - that is, whether that date
represents the date the financial statements were issued or were available to be
issued. This guidance is effective for interim and annual periods ending after
June 15, 2009. The Funds have performed an evaluation of subsequent events
through December 28, 2009, which is the date the financial statements were
issued.
Nuveen Investments 55
| Financial
| Highlights
Selected data for a share outstanding throughout each period:
INVESTMENT OPERATIONS
----------------------------------------------
NET
BEGINNING NET REALIZED/
NET ASSET INVESTMENT UNREALIZED
VALUE INCOME GAIN (LOSS) TOTAL
------------------------------------------------------------------------------------------------------------------
MUNICIPAL VALUE (NUV)
------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2009 $ 8.60 $ .49 $ .89 $ 1.38
2008 10.12 .47 (1.49) (1.02)
2007 10.39 .46 (.23) .23
2006 10.15 .47 .26 .73
2005 10.11 .47 .10 .57
MUNICIPAL VALUE 2 (NUW)
------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2009(b) 14.33 .49 1.94 2.43
MUNICIPAL INCOME (NMI)
------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2009 9.28 .57 1.06 1.63
2008 10.77 .53 (1.52) (.99)
2007 11.04 .52 (.28) .24
2006 10.86 .53 .16 .69
2005 10.76 .54 .09 .63
ENHANCED MUNICIPAL VALUE (NEV)
------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2009(c) 14.33 .04 (.61) (.57)
==================================================================================================================
LESS DISTRIBUTIONS
------------------------------
ENDING
NET NET ENDING
INVESTMENT CAPITAL OFFERING ASSET MARKET
INCOME GAINS TOTAL COSTS VALUE VALUE
--------------------------------------------------------------------------------------------------------------------
MUNICIPAL VALUE (NUV)
--------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2009 $ (.47) $ -- $ (.47) $ -- $ 9.51 $ 9.91
2008 (.47) (.03) (.50) -- 8.60 8.65
2007 (.47) (.03) (.50) -- 10.12 9.49
2006 (.47) (.02) (.49) -- 10.39 10.16
2005 (.47) (.06) (.53) -- 10.15 9.58
MUNICIPAL VALUE 2 (NUW)
--------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2009(b) (.53) -- (.53) (.03) 16.20 15.84
MUNICIPAL INCOME (NMI)
--------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2009 (.53) -- (.53) -- 10.38 10.66
2008 (.50) -- (.50) -- 9.28 9.89
2007 (.51) -- (.51) -- 10.77 10.49
2006 (.51) -- (.51) -- 11.04 10.50
2005 (.53) -- (.53) -- 10.86 10.56
ENHANCED MUNICIPAL VALUE (NEV)
--------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2009(c) -- -- -- (.03) 13.73 15.00
====================================================================================================================
56 Nuveen Investments
RATIOS/SUPPLEMENTAL DATA
---------------------------------------------------------------------
TOTAL RETURNS RATIOS TO AVERAGE NET ASSETS**
----------------- -----------------------------------------
BASED
BASED ON ENDING
ON NET NET EXPENSES EXPENSES NET PORTFOLIO
MARKET ASSET ASSETS INCLUDING EXCLUDING INVESTMENT TURNOVER
VALUE* VALUE* (000) INTEREST (a) INTEREST INCOME RATE
--------------------------------------------------------------------------------------------------------------------------
MUNICIPAL VALUE (NUV)
--------------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2009 20.68% 16.51% $ 1,872,031 .66% .64% 5.49% 5%
2008 (3.93) (10.51) 1,684,418 .65 .61 4.86 16
2007 (1.90) 2.22 1,974,535 .62 .59 4.53 10
2006 11.51 7.40 2,025,964 .59 .59 4.60 6
2005 8.25 5.73 1,979,396 .60 .60 4.64 8
MUNICIPAL VALUE 2 (NUW)
--------------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2009(b) 9.27 16.92 205,709 .67*** .67*** 4.84*** 2
MUNICIPAL INCOME (NMI)
--------------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2009 13.72 18.06 84,883 .81 .78 5.85 10
2008 (1.01) (9.53) 75,553 .86 .76 5.08 8
2007 4.78 2.23 87,424 .86 .75 4.76 6
2006 4.42 6.50 89,605 .76 .76 4.83 6
2005 10.21 5.93 88,147 .78 .78 4.99 7
ENHANCED MUNICIPAL VALUE (NEV)
--------------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2009(c) -- (4.15) 244,558 1.02*** 1.02*** 3.25*** 1
==========================================================================================================================
* Total Return Based 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. The last dividend declared
in the period, which is typically paid on the first business day of the
following month, is assumed to be reinvested at the ending market
price. The actual reinvestment for the last dividend declared in the
period may take place over several days, and in some instances may not
be based on the market price, so the actual reinvestment price may be
different from the price used in the calculation. Total returns are not
annualized.
Total Return Based on Net Asset Value is the combination of changes in
net asset value, reinvested dividend income at net asset value and
reinvested capital gains distributions at net asset value, if any. The
last dividend declared in the period, which is typically paid on the
first business day of the following month, is assumed to be reinvested
at the ending net asset value. The actual reinvest price for the last
dividend declared in the period may often be based on the Fund's market
price (and not its net asset value), and therefore may be different
from the price used in the calculation. Total returns are not
annualized.
** Expense ratios do not reflect the reduction of custodian fee credits
earned on the Fund's net cash on deposit with the custodian bank and
legal fee refund, where applicable.
*** Annualized.
(a) The expense ratios in the above table reflect, among other things, the
interest expense deemed to have been paid by the Fund on the floating
rate certificates issued by the special purpose trusts for the
self-deposited inverse floaters held by the Fund, as described in
Footnote 1 - Inverse Floating Rate Securities.
(b) For the period February 25, 2009 (commencement of operations) through
October 31, 2009.
(c) For the period September 25, 2009 (commencement of operations) through
October 31, 2009.
See accompanying notes to financial statements.
Nuveen Investments 57
Board Members & 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
(referred to herein as "independent board members") 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 PRINCIPAL
YEAR FIRST OF PORTFOLIOS OCCUPATION(S)
NAME, ELECTED OR IN FUND COMPLEX INCLUDING OTHER
BIRTHDATE POSITION(S) HELD APPOINTED OVERSEEN BY DIRECTORSHIPS
& ADDRESS WITH THE FUNDS AND TERM(1) BOARD MEMBER DURING PAST 5 YEARS
------------------------------------------------------------------------------------------------------------------------------------
INDEPENDENT BOARD MEMBERS:
o ROBERT P. BREMNER Private Investor and Management Consultant;
8/22/40 Chairman of Treasurer and Director, Humanities Council of
333 W. Wacker Drive the Board 1997 198 Washington D.C.
Chicago, IL 60606 and Board Member
o JACK B. EVANS President, The Hall-Perrine Foundation, a private
10/22/48 philanthropic corporation (since 1996); Director
333 W. Wacker Drive Board Member 1999 198 and Chairman, United Fire Group, a publicly held
Chicago, IL 60606 company; President Pro Tem of the Board of Regents
for the State of Iowa University System; Director,
Gazette Companies; Life Trustee of Coe College and
the 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.
o WILLIAM C. HUNTER Dean, Tippie College of Business, University of
3/6/48 Iowa (since 2006); Director (since 2004) of Xerox
333 W. Wacker Drive Board Member 2004 198 Corporation; Director (since 2005), Beta Gamma
Chicago, IL 60606 Sigma International Honor Society; formerly, Dean
and Distinguished Professor of Finance, School of
Business at the University of Connecticut
(2003-2006); previously, Senior Vice President and
Director of Research at the Federal Reserve Bank of
Chicago (1995-2003); Director, SS&C Technologies,
Inc. (May 2005-October 2005); formerly, Director
(1997-2007), Credit Research Center at Georgetown
University.
o DAVID J. KUNDERT Director, Northwestern Mutual Wealth Management
10/28/42 Company; retired (since 2004) as Chairman, JPMorgan
333 W. Wacker Drive Board Member 2005 198 Fleming Asset Management, President and CEO, Banc
Chicago, IL 60606 One Investment Advisors Corporation, and President,
One Group Mutual Funds; prior thereto, Executive
Vice President, Banc One Corporation and Chairman
and CEO, Banc One Investment Management Group;
Member, Board of Regents, Luther College; member of
the Wisconsin Bar Association; member of Board of
Directors, Friends of Boerner Botanical Gardens;
member of Investment Committee, Greater Milwaukee
Foundation.
o WILLIAM J. SCHNEIDER Chairman of Miller-Valentine Partners Ltd., a real
9/24/44 estate investment company; formerly, Senior Partner
333 W. Wacker Drive Board Member 1997 198 and Chief Operating Officer (retired, 2004) of
Chicago, IL 60606 Miller-Valentine Group; member, University of
Dayton Business School Advisory Council; member,
Dayton Philharmonic Orchestra Association;
formerly, member, Business Advisory Council,
Cleveland Federal Reserve Bank; formerly, Director,
Dayton Development Coalition.
58 Nuveen Investments
NUMBER PRINCIPAL
YEAR FIRST OF PORTFOLIOS OCCUPATION(S)
NAME, ELECTED OR IN FUND COMPLEX INCLUDING OTHER
BIRTHDATE POSITION(S) HELD APPOINTED OVERSEEN BY DIRECTORSHIPS
& ADDRESS WITH THE FUNDS AND TERM(1) BOARD MEMBER DURING PAST 5 YEARS
------------------------------------------------------------------------------------------------------------------------------------
INDEPENDENT BOARD MEMBERS: Executive Director, Gaylord and Dorothy Donnelley
o JUDITH M. STOCKDALE Foundation (since 1994); prior thereto, Executive
12/29/47 Director, Great Lakes Protection Fund (from 1990 to
333 W. Wacker Drive Board Member 1997 198 1994).
Chicago, IL 60606
o CAROLE E. STONE Director, Chicago Board Options Exchange (since
6/28/47 2006); Director, C2 Options Exchange, Incorporated
333 W. Wacker Drive Board Member 2007 198 (since 2009); Commissioner, New York State
Chicago, IL 60606 Commission on Public Authority Reform (since 2005);
formerly, Chair, New York Racing Association
Oversight Board (2005-2007).
o TERENCE J. TOTH Director, Legal & General Investment Management
9/29/59 America, Inc. (since 2008); Managing Partner, Musso
333 W. Wacker Drive Board Member 2008 198 Capital Management (since 2008); formerly, CEO and
Chicago, IL 60606 President, Northern Trust Investments (2004-2007);
Executive Vice President, Quantitative Management &
Securities Lending (2004-2007); prior thereto,
various positions with Northern Trust Company
(since 1994); Member: Goodman Theatre Board (since
2004), Chicago Fellowship Boards (since 2005),
University of Illinois Leadership Council Board
(since 2007) and Catalyst Schools of Chicago Board
(since 2008); formerly, Member: Northern Trust
Mutual Funds Board (2005-2007), Northern Trust
Investments Board (2004-2007), Northern Trust Japan
Board (2004-2007), Northern Trust Securities Inc.
Board (2003-2007) and Northern Trust Hong Kong
Board (1997-2004).
INTERESTED BOARD MEMBER: Chief Executive Officer (since July 2007) and
o JOHN P. AMBOIAN(2) Director (since 1999) of Nuveen Investments, Inc.;
6/14/61 Chief Executive Officer (since 2007) of Nuveen
333 W. Wacker Drive Board Member 2008 198 Asset Management, Nuveen Investments Advisors, Inc.
Chicago, IL 60606 formerly, President (1999-2004) of Nuveen Advisory
Corp. and Nuveen Institutional Advisory Corp.(3)
Nuveen Investments 59
Board Members & Officers (continued)
NUMBER
OF PORTFOLIOS
NAME, YEAR FIRST IN FUND COMPLEX PRINCIPAL
BIRTHDATE POSITION(S) HELD ELECTED OR OVERSEEN OCCUPATION(S)
AND ADDRESS WITH THE FUNDS APPOINTED(4) BY OFFICER DURING PAST 5 YEARS
------------------------------------------------------------------------------------------------------------------------------------
OFFICERS OF THE FUNDS: Managing Director (since 2002), Assistant
o GIFFORD R. ZIMMERMAN Secretary and Associate General Counsel of
9/9/56 Chief Nuveen Investments, LLC; Managing Director,
333 W. Wacker Drive Administrative 1988 198 Associate General Counsel and Assistant
Chicago, IL 60606 Officer Secretary, of Nuveen Asset Management (since
2002) and of Symphony Asset Management LLC,
(since 2003); Vice President and Assistant
Secretary of NWQ Investment Management Company,
LLC. (since 2002), Nuveen Investments Advisers
Inc. (since 2002), Tradewinds Global Investors,
LLC, and Santa Barbara Asset Management, LLC
(since 2006), Nuveen HydePark Group LLC and
Nuveen Investment Solutions, Inc. (since 2007);
Managing Director (since 2004) and Assistant
Secretary (since 1994) of Nuveen Investments,
Inc.; formerly, Managing Director (2002-2004),
General Counsel (1998-2004) and Assistant
Secretary of Nuveen Advisory Corp. and Nuveen
Institutional Advisory Corp.(3); Chartered
Financial Analyst.
o WILLIAM ADAMS IV Executive Vice President of Nuveen Investments,
6/9/55 Inc.; Executive Vice President, U.S. Structured
333 W. Wacker Drive Vice President 2007 123 Products of Nuveen Investments, LLC, (since
Chicago, IL 60606 1999), prior thereto, Managing Director of
Structured Investments.
o MARK J.P. ANSON President and Executive Director of Nuveen
6/10/59 Investments, Inc. (since 2007); President of
333 W. Wacker Drive Vice President 2009 198 Nuveen Investments Institutional Services Group
Chicago, IL 60606 LLC (since 2007); previously, Chief Executive
Officer of the British Telecom Pension Scheme
(2006-2007) and Chief Investment Officer of
Calpers (1999-2006); PhD, Chartered Financial
Analyst, Chartered Alternative Investment
Analyst, Certified Public Accountant, Certified
Management Accountant and Certified Internal
Auditor.
o CEDRIC H. ANTOSIEWICZ Managing Director, (since 2004), previously,
1/11/62 Vice President (1993-2004) of Nuveen
333 W. Wacker Drive Vice President 2007 123 Investments, LLC.
Chicago, IL 60606
o NIZIDA ARRIAGA Vice President (since 2007) of Nuveen
6/1/68 Investments, LLC; previously, Portfolio Manager,
333 W. Wacker Drive Vice President 2009 198 Allstate Investments, LLC (1996-2006); Chartered
Chicago, IL 60606 Financial Analyst.
o MICHAEL T. ATKINSON Vice President (since 2002) of Nuveen
2/3/66 Vice President Investments, LLC.; Vice President of Nuveen
333 W. Wacker Drive and Assistant 2000 198 Asset Management (since 2005).
Chicago, IL 60606 Secretary
o MARGO L. COOK Executive Vice President (since Oct 2008) of
4/11/64 Nuveen Investments, Inc.; previously, Head of
333 W. Wacker Drive Vice President 2009 198 Institutional Asset Management (2007-2008) of
Chicago, IL 60606 Bear Stearns Asset Management; Head of
Institutional Asset Mgt (1986-2007) of Bank of
NY Mellon; Chartered Financial Analyst.
o LORNA C. FERGUSON Managing Director (since 2004) of Nuveen
10/24/45 Investments, LLC; Managing Director (since 2005)
333 W. Wacker Drive Vice President 1998 198 of Nuveen Asset Management; Managing Director
Chicago, IL 60606 (2004-2005), of Nuveen Advisory Corp. and Nuveen
Institutional Advisory Corp.(3)
60 Nuveen Investments
NUMBER
OF PORTFOLIOS
NAME, YEAR FIRST IN FUND COMPLEX PRINCIPAL
BIRTHDATE POSITION(S) HELD ELECTED OR OVERSEEN OCCUPATION(S)
AND ADDRESS WITH THE FUNDS APPOINTED(4) BY OFFICER DURING PAST 5 YEARS
------------------------------------------------------------------------------------------------------------------------------------
OFFICERS OF THE FUNDS: Vice President (since 1993) and Funds Controller
o STEPHEN D. FOY (since 1998) of Nuveen Investments, LLC; Vice
5/31/54 Vice President President (since 2005) of Nuveen Asset
333 W. Wacker Drive and Controller 1998 198 Management; Certified Public Accountant.
Chicago, IL 60606
o SCOTT S. GRACE Managing Director, Corporate Finance &
8/20/70 Vice President Development, Treasurer (since September 2009) of
333 West Wacker Drive and Treasurer 2009 198 Nuveen Investments, LLC, formerly, Treasurer
Chicago, IL 60606 (2006-2009), Senior Vice President (2008-2009),
previously, Vice President (2006-2008) of Janus
Capital Group, Inc.; formerly. Senior Associate
in Morgan Stanley's Global Financial Services
Group (2000-2003); Chartered Accountant
Designation.
o WILLIAM T. HUFFMAN Chief Operating Officer, Municipal Fixed Income
5/7/69 (since 2008) of Nuveen Asset Management;
333 W. Wacker Drive Vice President 2009 134 previously, Chairman, President and Chief
Chicago, IL 60606 Executive Officer (2002 - 2007) of Northern
Trust Global Advisors, Inc. and Chief Executive
Officer (2007) of Northern Trust Global
Investments Limited; Certified Public
Accountant.
o WALTER M. KELLY Senior Vice President (since 2008), Vice
2/24/70 Chief Compliance President (2006-2008) formerly, Assistant Vice
333 W. Wacker Drive Officer and 2003 198 President and Assistant General Counsel
Chicago, IL 60606 Vice President (2003-2006) of Nuveen Investments, LLC; Vice
President (since 2006) and Assistant Secretary
(since 2008) of Nuveen Asset Management.
o DAVID J. LAMB Senior Vice President (since 2009), formerly,
3/22/63 Vice President (2000-2009) of Nuveen
333 W. Wacker Drive Vice President 2000 198 Investments, LLC; Vice President (since 2005) of
Chicago, IL 60606 Nuveen Asset Management; Certified Public
Accountant.
o TINA M. LAZAR Senior Vice President (since 2009), formerly,
8/27/61 Vice President of Nuveen Investments, LLC
333 W. Wacker Drive Vice President 2002 198 (1999-2009); Vice President of Nuveen Asset
Chicago, IL 60606 Management (since 2005).
o LARRY W. MARTIN Vice President, Assistant Secretary and
7/27/51 Vice President Assistant General Counsel of Nuveen Investments,
333 W. Wacker Drive and Assistant 1988 198 LLC; Vice President (since 2005) and Assistant
Chicago, IL 60606 Secretary Secretary of Nuveen Investments, Inc.; Vice
President (since 2005) and Assistant Secretary
(since 1997) of Nuveen Asset Management; Vice
President and Assistant Secretary of Nuveen
Investments Advisers Inc. (since 2002); NWQ
Investment Management Company, LLC (since 2002),
Symphony Asset Management LLC (since 2003),
Tradewinds Global Investors, LLC, Santa Barbara
Asset Management LLC (since 2006) and of Nuveen
HydePark Group, LLC and Nuveen Investment
Solutions, Inc. (since 2007); formerly, Vice
President and Assistant Secretary of Nuveen
Advisory Corp. and Nuveen Institutional Advisory
Corp.(3)
o KEVIN J. MCCARTHY Managing Director (since 2008), formerly, Vice
3/26/66 Vice President President (2007-2008), Nuveen Investments, LLC;
333 W. Wacker Drive and Secretary 2007 198 Managing Director (since 2008), formerly, Vice
Chicago, IL 60606 President, and Assistant Secretary, Nuveen Asset
Management, and Nuveen Investments Holdings,
Inc.; Vice President (since 2007) and Assistant
Secretary, Nuveen Investment Advisers Inc.,
Nuveen Investment Institutional Services Group
LLC, NWQ Investment Management Company, LLC,
Tradewinds Global Investors LLC, NWQ Holdings,
LLC, Symphony Asset Management LLC, Santa
Barbara Asset Management LLC, Nuveen HydePark
Group, LLC and Nuveen Investment Solutions, Inc.
(since 2007); prior thereto, Partner, Bell, Boyd
& Lloyd LLP (1997- 2007).
Nuveen Investments 61
Board Members & Officers (continued)
NUMBER
OF PORTFOLIOS
NAME, YEAR FIRST IN FUND COMPLEX PRINCIPAL
BIRTHDATE POSITION(S) HELD ELECTED OR OVERSEEN OCCUPATION(S)
AND ADDRESS WITH THE FUNDS APPOINTED(4) BY OFFICER DURING PAST 5 YEARS
------------------------------------------------------------------------------------------------------------------------------------
OFFICERS OF THE FUNDS: Chief Investment Officer and Managing Director
o JOHN V. MILLER (since 2007), formerly, Vice President
4/10/67 (2002-2007) of Nuveen Asset Management and
333 W. Wacker Drive Vice President 2007 134 Managing Director (since 2007), formerly Vice
Chicago, IL 60606 President (2002-2007) Nuveen Investments, LLC;
Chartered Financial Analyst.
o GREGORY MINO Vice President of Nuveen Investments, LLC (since
1/4/71 2008); previously, Director (2004-2007) and
333 W. Wacker Drive Vice President 2009 198 Executive Director (2007-2008) of UBS Global
Chicago, IL 60606 Asset Management; previously, Vice President
(2000-2003) and Director (2003-2004) of Merrill
Lynch Investment Managers; Chartered Financial
Analyst.
o CHRISTOPHER M. ROHRBACHER Vice President, Nuveen Investments, LLC (since
8/1/71 Vice President 2008); Vice President and Assistant Secretary,
333 W. Wacker Drive and Assistant 2008 198 Nuveen Asset Management (since 2008); prior
Chicago, IL 60606 Secretary thereto, Associate, Skadden, Arps, Slate Meagher
& Flom LLP (2002-2008).
o JAMES F. RUANE Vice President, Nuveen Investments, LLC (since
7/3/62 Vice President 2007); prior thereto, Partner, Deloitte & Touche
333 W. Wacker Drive and Assistant 2007 198 USA LLP (2005-2007), formerly, senior tax
Chicago, IL 60606 Secretary manager (2002-2005); Certified Public
Accountant.
o MARK L. WINGET Vice President, Nuveen Investments, LLC (since
12/21/68 Vice President 2008); Vice President and Assistant Secretary,
333 W. Wacker Drive and Assistant 2008 198 Nuveen Asset Management (since 2008); prior
Chicago, IL 60606 Secretary thereto, Counsel, Vedder Price P.C. (1997-2007).
(1) Board Members serve three year terms. The Board of Trustees is divided
into three classes. Class I, Class II, and Class III, with each being
elected to serve until the third succeeding annual shareholders' meeting
subsequent to its election or thereafter in each case when its respective
successors are duly elected or appointed. The first year elected or
appointed represents the year in which the board member was first elected
or appointed to any fund in the Nuveen Complex.
(2) Mr. Amboian is an interested trustee because of his position with Nuveen
Investments, Inc. and certain of its subsidiaries, which are affiliates of
the Nuveen Funds.
(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.
62 Nuveen Investments
Annual Investment Management Agreement Approval Process
The Investment Company Act of 1940, as amended (the "1940 Act"), provides, in
substance, that each investment advisory agreement between a fund and its
investment adviser will continue in effect from year to year only if its
continuance is approved at least annually by the fund's board members, including
by a vote of a majority of the board members who are not parties to the advisory
agreement or "interested persons" of any parties (the "Independent Board
Members"), cast in person at a meeting called for the purpose of considering
such approval. In connection with such approvals, the fund's board members must
request and evaluate, and the investment adviser is required to furnish, such
information as may be reasonably necessary to evaluate the terms of the advisory
agreement. Accordingly, at a meeting held on May 27-29, 2009 (the "May
Meeting"), the Boards of Trustees or Directors (as the case may be) (each, a
"Board" and each Trustee or Director, a "Board Member") of the Funds (other than
the Nuveen Municipal Value Fund 2 (the "Municipal Value Fund 2") and the Nuveen
Enhanced Municipal Value Fund (the "Enhanced Municipal Value Fund")), including
a majority of the Independent Board Members, considered and approved the
continuation of the advisory agreements (each an "Advisory Agreement") between
each Fund (other than the Municipal Value Fund 2 and the Enhanced Municipal
Value Fund) and Nuveen Asset Management ("NAM") for an additional one-year
period. In preparation for their considerations at the May Meeting, such Boards
also held a separate meeting on April 21-22, 2009 (the "April Meeting").
Accordingly, the factors considered and determinations made regarding the
renewals by the Independent Board Members include those made at the April
Meeting.
The Municipal Value Fund 2 and the Enhanced Municipal Value Fund are new Funds.
The initial Advisory Agreement between NAM and the Municipal Value Fund 2 was
approved separately at a meeting of such Fund's Board held on January 27, 2009
and was not up for renewal at the May Meeting. The initial Advisory Agreement
between NAM and the Enhanced Municipal Value Fund was approved separately at a
meeting of such Fund's Board held on July 28-29, 2009.
The discussion of the approvals for the Nuveen Municipal Value Fund, Inc. and
the Nuveen Municipal Income Fund, Inc. is set forth below in Section I, followed
by the discussion in Section II of the approval for the Enhanced Municipal Value
Fund. The discussion of the approval for the Municipal Value Fund 2 was included
in the semi-annual report for such Fund for the period ending April 30, 2009.
Nuveen Investments 63
Annual Investment Management Agreement Approval Process (continued)
I.
NUVEEN MUNICIPAL VALUE FUND, INC.
NUVEEN MUNICIPAL INCOME FUND, INC.
With respect to the Funds listed above (for purposes of this Section I, the
"Funds"), in evaluating the applicable Advisory Agreements (for purposes of this
Section I, the "Advisory Agreements"), the Independent Board Members reviewed a
broad range of information relating to the Funds and NAM, including absolute
performance, fee and expense information for the Funds as well as comparative
performance, fee and expense information for a comparable peer group of funds,
the performance information of recognized and/or customized benchmarks (as
applicable) of the Funds, the profitability of Nuveen for its advisory
activities (which includes its wholly owned subsidiaries other than Winslow
Capital Management, Inc. ("Winslow Capital"), which was recently acquired in
December 2008), and other information regarding the organization, personnel, and
services provided by NAM. The Independent Board Members also met quarterly as
well as at other times as the need arose during the year and took into account
the information provided at such meetings and the knowledge gained therefrom.
Prior to approving the renewal of the Advisory Agreements, the Independent Board
Members reviewed the foregoing information with their independent legal counsel
and with management, reviewed materials from independent legal counsel
describing applicable law and their duties in reviewing advisory contracts, and
met with independent legal counsel in private sessions without management
present. The Independent Board Members considered the legal advice provided by
independent legal counsel and relied upon their knowledge of NAM, its services
and the Funds resulting from their meetings and other interactions throughout
the year and their own business judgment in determining the factors to be
considered in evaluating the Advisory Agreements. Each Board Member may have
accorded different weight to the various factors in reaching his or her
conclusions with respect to a Fund's Advisory Agreement. The Independent Board
Members did not identify any single factor as all-important or controlling. The
Independent Board Members' considerations were instead based on a comprehensive
consideration of all the information presented. The principal factors considered
by the Board and its conclusions are described below.
A. NATURE, EXTENT AND QUALITY OF SERVICES
In considering renewal of the Advisory Agreements, the Independent Board Members
considered the nature, extent and quality of NAM's services, including advisory
services and administrative services. The Independent Board Members reviewed
materials outlining, among other things, NAM's organization and business; the
types of services that NAM or its affiliates provide and are expected to provide
to the Funds; the performance record of the applicable Fund (as described in
further detail below); and any initiatives Nuveen had taken for the applicable
fund product line.
In reviewing the services provided and the initiatives undertaken during the
past year, the Independent Board Members recognized the severe market turmoil
experienced in the capital markets during recent periods, including sustained
periods of high volatility, credit disruption and government intervention. The
Independent Board Members considered NAM's efforts, expertise and other actions
taken to address matters as they
64 Nuveen Investments
arose that impacted the Funds. The Independent Board Members recognized the role
of the Investment Services group which, among other things, monitors the various
positions throughout the Nuveen fund complex to identify and address any
systematic risks. In addition, the Capital Markets Committee of NAM provides a
multi-departmental venue for developing new policies to mitigate any risks. The
Independent Board Members further recognized NAM's continuous review of the
Nuveen funds' investment strategies and mandates in seeking to continue to
refine and improve the investment process for the funds, particularly in light
of market conditions. With respect to closed-end funds that issued auction rate
preferred shares ("ARPs") or that otherwise utilize leverage, the Independent
Board Members noted, in particular, NAM's efforts in refi-nancing the preferred
shares of such funds frozen by the collapse of the auction rate market and
managing leverage during a period of rapid market declines, particularly for the
non-equity funds. Such efforts included negotiating and maintaining the
availability of bank loan facilities and other sources of credit used for
investment purposes or to satisfy liquidity needs, liquidating portfolio
securities during difficult times to meet leverage ratios, and seeking
alternative forms of debt and other leverage that may over time reduce financing
costs associated with ARPs and enable the funds that have issued ARPs to restore
liquidity to ARPs holders. The Independent Board Members also noted Nuveen's
continued commitment and efforts to keep investors and financial advisers
informed as to its progress with the ARPs through, among other things,
conference calls, emails, press releases, information posted on its website, and
telephone calls and in-person meetings with financial advisers. In addition to
the foregoing, the Independent Board Members also noted the additional services
that NAM or its affiliates provide to closed-end funds, including, in
particular, Nuveen's continued commitment to supporting the secondary market for
the common shares of its closed-end funds through a variety of programs designed
to raise investor and analyst awareness and understanding of closed-end funds.
These efforts include maintaining an investor relations program to provide
timely information and education to financial advisers and investors; providing
advertising and marketing for the closed-end funds; maintaining websites; and
providing educational seminars.
As part of their review, the Independent Board Members also evaluated the
background, experience and track record of NAM's investment personnel. In this
regard, the Independent Board Members considered any changes in the personnel,
and the impact on the level of services provided to the Funds, if any. The
Independent Board Members also reviewed information regarding portfolio manager
compensation arrangements to evaluate NAM's ability to attract and retain high
quality investment personnel, preserve stability, and reward performance but not
provide an incentive for taking undue risks.
In addition to advisory services, the Independent Board Members considered the
quality of administrative services provided by NAM and its affiliates including
product management, fund administration, oversight of service providers,
shareholder services, administration of Board relations, regulatory and
portfolio compliance and legal support. Given the importance of compliance, the
Independent Board Members considered NAM's compliance program, including the
report of the chief compliance officer regarding the Funds' compliance policies
and procedures.
Nuveen Investments 65
Annual Investment Management Agreement Approval Process (continued)
Based on their review, the Independent Board Members found that, overall, the
nature, extent and quality of services provided (and expected to be provided) to
the respective Funds under the Advisory Agreements were satisfactory.
B. THE INVESTMENT PERFORMANCE OF THE FUNDS AND NAM
The Board considered the investment performance of each Fund, including the
Fund's historic performance as well as its performance compared to funds with
similar investment objectives (the "Performance Peer Group") based on data
provided by an independent provider of mutual fund data as well as recognized
and/or customized benchmarks (as applicable). The Independent Board Members
reviewed performance information including, among other things, total return
information compared with the Fund's Performance Peer Group and recognized
and/or customized benchmarks (as applicable) for the quarter-, one-, three- and
five-year periods (as applicable) ending December 31, 2008 and for the same
periods (as applicable) ending March 31, 2009. The Independent Board Members
also reviewed performance information of the Nuveen municipal funds managed by
NAM in the aggregate ranked by peer group and the performance of such funds, in
the aggregate, relative to their benchmark. This information supplemented the
Fund performance information provided to the Board at each of its quarterly
meetings.
In comparing a fund's performance with that of its Performance Peer Group, the
Independent Board Members took into account that the closest Performance Peer
Group in certain instances may not adequately reflect the respective fund's
investment objectives and strategies thereby hindering a meaningful comparison
of the fund's performance with that of the Performance Peer Group. The
Independent Board Members further considered the performance of the Funds in the
context of the volatile market conditions during the past year, and their impact
on various asset classes and the portfolio management of the Funds.
Based on their review and factoring in the severity of market turmoil in 2008,
the Independent Board Members determined that each Fund's investment performance
over time had been satisfactory.
C. FEES, EXPENSES AND PROFITABILITY
1. Fees and Expenses
The Board evaluated the management fees and expenses of each Fund
reviewing, among other things, such Fund's gross management fees, net
management fees and total expense ratios (before and after expense
reimbursements and/or waivers) in absolute terms as well as compared to
the fee and expenses of a comparable universe of unaffiliated funds based
on data provided by an independent fund data provider (the "Peer
Universe") and in certain cases, to a more focused subset of funds in the
Peer Universe (the "Peer Group").
The Independent Board Members further reviewed data regarding the
construction of the applicable Peer Universe and Peer Group. In reviewing
the comparisons of fee and expense information, the Independent Board
Members took into account that in certain instances various factors such
as the asset level of a fund relative to peers, the
66 Nuveen Investments
size and particular composition of the Peer Universe or Peer Group, the
investment objectives of the peers, expense anomalies, changes in the
funds comprising the Peer Universe or Peer Group from year to year, levels
of reimbursement and the timing of information used may impact the
comparative data, thereby limiting the ability to make a meaningful
comparison. In addition, the Independent Board Members considered, among
other things, the differences in the use and type of leverage compared to
the peers. In reviewing the fee schedule for a Fund, the Independent Board
Members also considered the fund-level and complex-wide breakpoint
schedules (described in further detail below) and any fee waivers and
reimbursements provided by Nuveen (applicable, in particular, for certain
closed-end funds launched since 1999).
Based on their review of the fee and expense information provided, the
Independent Board Members determined that each Fund's management fees and
net total expense ratio were reasonable in light of the nature, extent and
quality of services provided to the Fund.
2. Comparisons with the Fees of Other Clients
The Independent Board Members further reviewed information regarding the
nature of services and fee rates offered by NAM to other clients. Such
other clients include NAM's municipal separately managed accounts. In
evaluating the comparisons of fees, the Independent Board Members noted
that the fee rates charged to the Funds and other clients vary, among
other things, because of the different services involved and the
additional regulatory and compliance requirements associated with
registered investment companies, such as the Funds. Accordingly, the
Independent Board Members considered the differences in the product types,
including, but not limited to, the services provided, the structure and
operations, product distribution and costs thereof, portfolio investment
policies, investor profiles, account sizes and regulatory requirements.
The Independent Board Members noted, in particular, that the range of
services provided to the Funds (as discussed above) is much more extensive
than that provided to separately managed accounts. Given the inherent
differences in the products, particularly the extensive services provided
to the Funds, the Independent Board Members believe such facts justify the
different levels of fees.
3. Profitability of Nuveen
In conjunction with its review of fees, the Independent Board Members also
considered the profitability of Nuveen for its advisory activities (which
incorporated Nuveen's wholly-owned affiliated sub-advisers other than
Winslow Capital) and its financial condition. The Independent Board
Members reviewed the revenues and expenses of Nuveen's advisory activities
for the last two years, the allocation methodology used in preparing the
profitability data and an analysis of the key drivers behind the changes
in revenues and expenses that impacted profitability in 2008. In addition,
the Independent Board Members reviewed information regarding the financial
results of Nuveen for 2008 based on its Form 8-K filed on March 31, 2009.
The Independent Board Members noted this information supplemented the
profitability information requested and received during the year to help
keep them apprised of developments affecting profitability (such as
changes in fee waivers and expense reimbursement commitments). In this
regard, the Independent Board
Nuveen Investments 67
Annual Investment Management Agreement Approval Process (continued)
Members noted that they had also appointed an Independent Board Member as
a point person to review and keep them apprised of changes to the
profitability analysis and/or methodologies during the year. The
Independent Board Members also considered Nuveen's revenues for advisory
activities, expenses, and profit margin compared to that of various
unaffiliated management firms with similar amounts of assets under
management and relatively comparable asset composition prepared by Nuveen.
In reviewing profitability, the Independent Board Members recognized the
subjective nature of determining profitability which may be affected by
numerous factors including the allocation of expenses. Further, the
Independent Board Members recognized the difficulties in making
comparisons as the profitability of other advisers generally is not
publicly available and the profitability information that is available for
certain advisers or management firms may not be representative of the
industry and may be affected by, among other things, the adviser's
particular business mix, capital costs, types of funds managed and expense
allocations. Notwithstanding the foregoing, the Independent Board Members
reviewed Nuveen's methodology and assumptions for allocating expenses
across product lines to determine profitability. In reviewing
profitability, the Independent Board Members recognized Nuveen's
investment in its fund business.
Based on their review, the Independent Board Members concluded that
Nuveen's level of profitability for its advisory activities was reasonable
in light of the services provided.
In evaluating the reasonableness of the compensation, the Independent
Board Members also considered other amounts paid to NAM by the Funds as
well as any indirect benefits (such as soft dollar arrangements, if any)
NAM and its affiliates receive, or are expected to receive, that are
directly attributable to the management of the Funds, if any. See Section
E below for additional information on indirect benefits NAM may receive as
a result of its relationship with the Funds. Based on their review of the
overall fee arrangements of each Fund, the Independent Board Members
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
With respect to economies of scale, the Independent Board Members have
recognized the potential benefits resulting from the costs of a fund being
spread over a larger asset base, although economies of scale are difficult to
measure and predict with precision, particularly on a fund-by-fund basis. One
method to help ensure the shareholders share in these benefits is to include
breakpoints in the advisory fee schedule. Generally, management fees for funds
in the Nuveen complex are comprised of a fund-level component and a
complex-level component, subject to certain exceptions. Accordingly, the
Independent Board Members reviewed and considered the applicable fund-level
breakpoints in the advisory fee schedules that reduce advisory fees as asset
levels increase. In this regard, the Independent Board Members noted that
although closed-end funds may from time-to-time make additional share offerings,
the growth of their assets will occur primarily through the appreciation of such
funds' investment portfolio.
68 Nuveen Investments
While economies of scale result when costs can be spread over a larger asset
base, the Independent Board Members also recognized that the asset levels
generally declined in 2008 due to, among other things, the market downturn.
Accordingly, for funds with a reduction in assets under management, advisory fee
levels may have increased as breakpoints in the fee schedule were no longer
surpassed.
In addition to fund-level advisory fee breakpoints, the Board also considered
the Funds' complex-wide fee arrangement. Pursuant to the complex-wide fee
arrangement, the fees of the funds in the Nuveen complex generally are reduced
as the assets in the fund complex reach certain levels. The complex-wide fee
arrangement seeks to provide the benefits of economies of scale to fund
shareholders when total fund complex assets increase, even if assets of a
particular fund are unchanged or have decreased. The approach reflects the
notion that some of Nuveen's costs are attributable to services provided to all
its funds in the complex and therefore all funds benefit if these costs are
spread over a larger asset base. Generally, the complex-wide pricing reduces
Nuveen's revenue because total complex fund assets have consistently grown in
prior years. As noted, however, total fund assets declined in 2008 resulting in
a smaller downward adjustment of revenues due to complex-wide pricing compared
to the prior year.
Based on their review, the Independent Board Members concluded that the
breakpoint schedules and complex-wide fee arrangement were acceptable and
reflect economies of scale to be shared with shareholders when assets under
management increase.
E. INDIRECT BENEFITS
In evaluating fees, the Independent Board Members received and considered
information regarding potential "fall out" or ancillary benefits NAM or its
affiliates may receive as a result of its relationship with each Fund. In this
regard, the Independent Board Members considered revenues received by affiliates
of NAM for serving as agent at Nuveen's trading desk.
In addition to the above, the Independent Board Members considered whether NAM
received any benefits from soft dollar arrangements whereby a portion of the
commissions paid by a Fund for brokerage may be used to acquire research that
may be useful to NAM in managing the assets of the Funds and other clients. The
Independent Board Members noted that NAM does not currently have any soft dollar
arrangements; however, to the extent certain bona fide agency transactions that
occur on markets that traditionally trade on a principal basis and riskless
principal transactions are considered as generating "commissions," NAM intends
to comply with the applicable safe harbor provisions.
Based on their review, the Independent Board Members concluded that any indirect
benefits received by NAM as a result of its relationship with the Funds were
reasonable and within acceptable parameters.
Nuveen Investments 69
F. OTHER CONSIDERATIONS
The Independent Board Members did not identify any single factor discussed
previously as all-important or controlling. The Board Members, including the
Independent Board Members, unanimously concluded that the terms of the Advisory
Agreements are fair and reasonable, that NAM's fees are reasonable in light of
the services provided to each Fund and that the Advisory Agreements be renewed.
II
Nuveen Enhanced Municipal Value Fund
The Board Members are responsible for approving the advisory arrangement of the
Enhanced Municipal Value Fund (for purposes of this Section II, the "Fund") and,
at a meeting held on July 28-29, 2009 (for purposes of this Section II, the
"Meeting"), the Board Members, including the Independent Board Members,
considered and approved the investment advisory agreement (for purposes of this
Section II, the "Advisory Agreement") between NAM and the Fund.
To assist the Board in its evaluation of the Advisory Agreement at the Meeting,
the Independent Board Members had received, in adequate time in advance of the
Meeting or at prior meetings, materials which outlined, among other things:
o the nature, extent and quality of services expected to be provided by NAM;
o the organization of NAM, including the responsibilities of various
departments and key personnel;
o the expertise and background of NAM with respect to the Fund's investment
strategy;
o certain performance-related information (as described below);
o the profitability of Nuveen Investments, Inc. ("Nuveen") (which
incorporated Nuveen's wholly-owned affiliated sub-advisers other than
Winslow Capital Management, Inc. (" Winslow Capital") which was recently
acquired in December 2008);
o the proposed management fees of NAM, including comparisons of such fees
with the management fees of comparable funds;
o the expected expenses of the Fund, including comparisons of the Fund's
expected expense ratio with the expense ratios of comparable funds; and
o the soft dollar practices of NAM, if any.
At the Meeting, NAM made a presentation to and responded to questions from the
Board. During the Meeting, the Independent Board Members also met privately with
their legal counsel to review the Board's duties under the Investment Company
Act of 1940 (the "1940 Act"), the general principles of state law in reviewing
and approving advisory contracts, the standards used by courts in determining
whether investment company boards of directors have fulfilled their duties,
factors to be considered in voting on advisory contracts and an adviser's
fiduciary duty with respect to advisory agreements and compensation. It is with
this background that the Independent Board Members considered the Advisory
Agreement for the Fund. As outlined in more detail below, the Independent Board
Members considered all factors they believed relevant with respect to the Fund,
including the following: (a) the nature, extent and quality of the
70 Nuveen Investments
services to be provided by NAM; (b) investment performance, as described below;
(c) the profitability of Nuveen and its affiliates; (d) the extent to which
economies of scale would be realized; and (e) whether fee levels reflect these
economies of scale for the benefit of Fund investors.
A. NATURE, EXTENT AND QUALITY OF SERVICES
The Independent Board Members considered the nature, extent and quality of NAM's
services, including advisory services and administrative services. As NAM
already serves as adviser to other Nuveen funds overseen by the Board Members,
the Board has a good understanding of NAM's organization, operations and
personnel. As the Independent Board Members meet regularly throughout the year
to oversee the Nuveen funds, including funds currently advised by NAM, the
Independent Board Members have relied upon their knowledge from their meetings
and any other interactions throughout the year of NAM and its services in
evaluating the Advisory Agreement.
At the Meeting and at prior meetings, the Independent Board Members reviewed
materials outlining, among other things, Nuveen's organization and business; the
types of services that NAM or its affiliates provide to the Nuveen funds and are
expected to provide to the Fund; and NAM's experience with applicable investment
strategies. Further, the Independent Board Members have evaluated the
background, experience and track record of NAM's investment personnel.
In addition to advisory services, the Independent Board Members considered the
quality of any administrative or non-advisory services to be provided. In this
regard, NAM is expected to provide the Fund with such administrative and other
services (exclusive of, and in addition to, any such services provided by others
for the Fund) and officers and other personnel as are necessary for the
operations of the Fund. In addition to investment management services, NAM and
its affiliates will provide the Fund with a wide range of services, including,
among other things, product management, fund administration, oversight of
service providers, shareholder services, administration of Board relations,
regulatory and portfolio compliance and legal support.
In addition to the foregoing services, the Independent Board Members also noted
the additional services that NAM or its affiliates provide to closed-end funds,
including, in particular, Nuveen's continued commitment to supporting the
secondary market for the common shares of its closed-end funds through a variety
of programs designed to raise investor and analyst awareness and understanding
of closed-end funds. These efforts include maintaining an investor relations
program to provide timely information and education to financial advisers and
investors; providing advertising and marketing for the closed-end funds;
maintaining websites; and providing educational seminars.
Based on their review, the Independent Board Members found that, overall, the
nature, extent and quality of services expected to be provided to the Fund under
the Advisory Agreement were satisfactory.
Nuveen Investments 71
B. INVESTMENT PERFORMANCE
The Fund is new and therefore does not have its own performance history.
However, the Independent Board Members are familiar with NAM's performance
record on other Nuveen funds. The Fund is expected to employ substantially the
same investment philosophy and strategies used in certain other national
leveraged municipal closed-end funds managed by NAM. In this regard, the
Independent Board Members were provided with certain average dividend yield
information (as of July 21, 2009) pertaining to such other Nuveen funds.
C. FEES, EXPENSES AND PROFITABILITY
1. Fees and Expenses
In evaluating the management fees and expenses that the Fund was expected
to bear, the Independent Board Members considered, among other things, the
Fund's proposed management fee structure and its expected expense ratios
in absolute terms as well as compared with the fees and expense ratios of
comparable funds.
The Independent Board Members noted that the Fund may make investments in
certain instruments that have the economic effect of leverage, including
inverse floating rate securities (such as those representing interests in
so-called "tender option bond trusts" formed by third-party sponsors for
the purpose of holding municipal bonds). The Independent Board Members
recognized that assets financed through the creation of tender option bond
trusts in which the Fund may invest would be included in the amount of
assets upon which the advisory fee is calculated. In this regard, the
Independent Board Members noted that the advisory fee is based on a
percentage of average daily "Managed Assets." "Managed Assets" generally
means the total assets of the Fund (including assets attributable to the
Fund's use of effective leverage such as, but not limited to, the portion
of assets in tender option bond trusts) minus the sum of accrued
liabilities (other than Fund liabilities incurred for the express purpose
of creating effective leverage). Accordingly, the advisory fees paid to
NAM for investment advisory services will be higher if the Fund uses
effective leverage, which may create a conflict of interest between NAM
and Fund shareholders. This methodology is consistent with that used on
certain other Nuveen municipal closed-end funds.
The Independent Board Members also considered the fund-level breakpoint
schedule and the complex-wide breakpoint schedule (described in further
detail below) and any applicable fee waivers and expense reimbursements
expected to be provided. Based on their review of the fee and expense
information provided, the Independent Board Members determined that the
Fund's management fees and net total expense ratio were reasonable in
light of the nature, extent and quality of services to be provided to the
Fund.
2. Comparisons with the Fees of Other Clients
Due to their experience with other Nuveen funds, the Board Members were
familiar with the fees NAM assesses to other clients. Such other clients
include separately managed accounts (both retail and institutional
accounts) and funds that are not offered by Nuveen but are sub-advised by
one of Nuveen's investment management
72 Nuveen Investments
teams. In evaluating the comparisons of fees, the Independent Board
Members have noted, at the Meeting or at prior meetings, that the fee
rates charged to a fund (such as the Fund) and charged to other clients
vary, among other things, because of the different services involved and
the additional regulatory and compliance requirements associated with
registered investment companies, such as the Fund. Accordingly, the
Independent Board Members have considered the differences in the product
types, including, but not limited to, the services to be provided, the
structure and operations, product distribution and costs thereof,
portfolio investment policies, investor profiles, account sizes and
regulatory requirements. The Independent Board Members have noted, in
particular, that the range of services as described above to be provided
to a fund (such as the Fund) is much more extensive than that provided to
separately managed accounts. Given the inherent differences in the
products, particularly the extensive services to be provided to a fund,
the Independent Board Members believe such facts justify the different
levels of fees.
3. Profitability of Nuveen
In conjunction with its review of fees at prior meetings, the Independent
Board Members have considered the profitability of Nuveen for its advisory
activities (which incorporated Nuveen's wholly-owned affiliated
sub-advisers other than Winslow Capital) and its financial condition. At
the Meeting or prior meetings, the Independent Board Members reviewed the
revenues and expenses of Nuveen's advisory activities, the allocation
methodology used in preparing the profitability data and an analysis of
the key drivers behind the changes in revenues and expenses that impacted
profitability in 2008. In addition, the Independent Board Members have
reviewed information regarding the financial results of Nuveen for 2008
based on its Form 8-K filed on March 31, 2009. They also reviewed the Form
8-K filed by Nuveen on July 9, 2009 (relating to, among other things,
proposed financing and amendments to Nuveen's credit facility). The
Independent Board Members have also considered, at the Meeting or at prior
meetings, Nuveen's revenues for advisory activities, expenses, and profit
margin compared to that of various unaffiliated management firms with
similar amounts of assets under management and relatively comparable asset
composition prepared by Nuveen.
In reviewing profitability, the Independent Board Members have recognized
the subjective nature of determining profitability, which may be affected
by numerous factors, including the allocation of expenses. Further, the
Independent Board Members have recognized the difficulties in making
comparisons as the profitability of other advisers generally is not
publicly available and the profitability information that is available for
certain advisers or management firms may not be representative of the
industry and may be affected by, among other things, the adviser's
particular business mix, capital costs, types of funds managed and expense
allocations. Notwithstanding the foregoing, the Independent Board Members
reviewed Nuveen's methodology and assumptions for allocating expenses
across product lines to determine profitability. In reviewing
profitability, the Independent Board Members recognized Nuveen's
investment in its fund business. Based on their review, the Independent
Board Members concluded that Nuveen's level of profitability for its
advisory activities was reasonable in light of the services to be
provided.
Nuveen Investments 73
In evaluating the reasonableness of the compensation, the Independent
Board Members also considered any other amounts expected to be 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 Fund, if any. See Section E below
for additional information on indirect benefits NAM may receive as a
result of its relationship with the Fund. Based on their review of the
overall fee arrangements of the Fund, the Independent Board Members
determined that the advisory fees and expected expenses of the Fund were
reasonable.
D. ECONOMIES OF SCALE AND WHETHER FEE LEVELS REFLECT THESE ECONOMIES OF SCALE
With respect to economies of scale, the Independent Board Members have
recognized the potential benefits resulting from the costs of a fund being
spread over a larger asset base, although economies of scale are difficult to
measure and predict with precision, particularly on a fund-by-fund basis. The
Independent Board Members therefore considered whether the Fund could be
expected to benefit from any economies of scale. One method to help ensure that
shareholders share in these benefits is to include breakpoints in the advisory
fee schedule. Generally, management fees for funds in the Nuveen complex are
comprised of a fund-level component and a complex-level component. Accordingly,
the Independent Board Members received and reviewed the schedule of proposed
advisory fees for the Fund, including fund-level breakpoints thereto. In this
regard, however, given that the Fund is a closed-end fund, the Independent Board
Members recognized that although the Fund may from time to time make additional
share offerings, the growth in its assets will occur primarily through
appreciation of its investment portfolio.
In addition to fund-level advisory fee breakpoints, the Board also considered
the Fund's complex-wide fee arrangement. Pursuant to the complex-wide fee
arrangement, the fees of the funds in the Nuveen complex, including the Fund,
are generally reduced as the assets in the fund complex reach certain levels. In
evaluating the complex-wide fee arrangement, the Independent Board Members have
considered that the complex-wide fee arrangement seeks to provide the benefits
of economies of scale to fund shareholders when total fund complex assets
increase, even if assets of a particular fund are unchanged or have decreased.
The approach reflects the notion that some of Nuveen's costs are attributable to
services provided to all its funds in the complex and therefore all funds
benefit if these costs are spread over a larger asset base. Based on their
review, the Independent Board Members concluded that the breakpoint schedule and
complex-wide fee arrangement were acceptable and reflect economies of scale to
be shared with the Fund's shareholders.
E. INDIRECT BENEFITS
In evaluating fees, the Independent Board Members also considered information
regarding potential "fall out" or ancillary benefits that NAM or its affiliates
may receive as a result of its relationship with the Fund. In this regard, the
Independent Board Members considered the revenues received by affiliates of NAM
for serving as agent at Nuveen's trading desk.
74 Nuveen Investments
In addition to the above, the Independent Board Members considered whether NAM
will receive any benefits from soft dollar arrangements whereby a portion of the
commissions paid by the Fund for brokerage may be used to acquire research that
may be useful to NAM in managing the assets of the Fund and other clients. The
Independent Board Members noted that NAM does not currently have any soft dollar
arrangements; however, to the extent certain bona fide agency transactions that
occur on markets that traditionally trade on a principal basis and riskless
principal transactions are considered as generating "commissions," NAM intends
to comply with the applicable safe harbor provisions.
Based on their review, the Independent Board Members concluded that any indirect
benefits received by NAM as a result of its relationship with the Fund were
reasonable and within acceptable parameters.
F. APPROVAL
The Independent Board Members did not identify any single factor discussed
previously as all-important or controlling. The Board Members, including a
majority of the Independent Board Members, concluded that the terms of the
Advisory Agreement were fair and reasonable, that NAM's fees are reasonable in
light of the services to be provided to the Fund and that the Advisory Agreement
should be and was approved on behalf of the Fund.
Nuveen Investments 75
Reinvest Automatically Easily and Conveniently
NUVEEN MAKES REINVESTING EASY. A PHONE CALL IS ALL IT TAKES TO SET UP YOUR
REINVESTMENT ACCOUNT.
NUVEEN CLOSED-END FUNDS DIVIDEND REINVESTMENT PLAN
Your Nuveen 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
greater of the net asset value or 95% of 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. If the Plan Agent begins purchasing Fund shares on
the open market while shares are trading below net asset value, but the Fund's
shares subsequently trade at or above their net asset value before the Plan
Agent is able to complete its purchases, the Plan Agent may cease open-market
purchases and may invest the uninvested portion of the distribution in
newly-issued Fund shares at a price equal to the greater of the shares' net
asset value or 95% of the shares' market value on the last business day
immediately prior to the purchase date. 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
76 Nuveen Investments
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.
Nuveen Investments 77
Glossary of Terms Used in this Report
o AUCTION RATE BOND: An auction rate bond is a security whose interest
payments are adjusted periodically through an auction process, which
process typically also serves as a means for buying and selling the bond.
Auctions that fail to attract enough buyers for all the shares offered for
sale are deemed to have "failed", with current holders receiving a
formula-based interest rate until the next scheduled auction.
o 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.
o AVERAGE EFFECTIVE MATURITY: The average of the number of years to maturity
of the bonds in a Fund's portfolio, computed by weighting each bond's time
to maturity (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 unless an escrow account has been
established to redeem the bond before maturity. The market value weighting
for an investment in an inverse floating rate security is the value of the
portfolio's residual interest in the inverse floating rate trust, and does
not include the value of the floating rate securities issued by the trust.
o 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.
o INVERSE FLOATERS: Inverse floating rate securities, also known as inverse
floaters, are created by depositing a municipal bond, typically with a
fixed interest rate, into a special purpose trust created by a
broker-dealer. This trust, in turn, (a) issues floating rate certificates
typically paying short-term tax-exempt interest rates to third parties in
amounts equal to some fraction of the deposited bond's par amount or
market value, and (b) issues an inverse floating rate certificate
(sometimes referred to as an "inverse floater") to an investor (such as a
Fund) interested in gaining investment exposure to a long-term municipal
bond. The income received by the holder of the inverse floater varies
inversely with the short-term rate paid to the floating rate certificates'
holders, and in most circumstances the holder of the inverse floater bears
substantially all of the underlying bond's downside investment risk. The
holder of the inverse floater typically also benefits disproportionately
from any potential appreciation of the underlying bond's value. Hence, an
inverse floater essentially represents an investment in the underlying
bond on a leveraged basis.
78 Nuveen Investments
o MARKET YIELD (ALSO KNOWN AS DIVIDEND YIELD OR CURRENT YIELD): An
investment's current annualized dividend divided by its current market
price.
o NET ASSET VALUE (NAV): A Fund's NAV per share is calculated by subtracting
the liabilities of 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.
o PRE-REFUNDING: Pre-refunding, also known as advanced refundings or
refinancings, is a procedure used by state and local governments to
refinance municipal bonds to lower interest expenses. The issuer sells new
bonds with a lower yield and uses the proceeds to buy U.S. Treasury
securities, the interest from which is used to make payments on the
higher-yielding bonds. Because of this collateral, pre-refunding generally
raises a bond's credit rating and thus its value.
o 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.
o ZERO COUPON BOND: A zero coupon bond does not pay a regular interest
coupon to its holders during the life of the bond. Tax-exempt income to
the holder of the bond comes from accretion of the difference between the
original purchase price of the bond at issuance and the par value of the
bond at maturity and is effectively paid at maturity. The market prices of
zero coupon bonds generally are more volatile than the market prices of
bonds that pay interest periodically.
Nuveen Investments 79
Notes
80 Nuveen Investments
Other Useful Information
BOARD OF DIRECTORS/TRUSTEES
John P. Amboian
Robert P. Bremner
Jack B. Evans
William C. Hunter
David J. Kundert
William J. Schneider
Judith M. Stockdale
Carole E. Stone
Terence J. Toth
FUND MANAGER
Nuveen Asset Management
333 West Wacker Drive
Chicago, IL 60606
CUSTODIAN
State Street Bank & Trust Company
Boston, MA
TRANSFER AGENT AND SHAREHOLDER SERVICES
State Street Bank & Trust Company
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
NUVEEN FUNDS' QUARTERLY PORTFOLIO OF INVESTMENTS AND PROXY VOTING INFORMATION
You may obtain (i) each Fund's quarterly portfolio of investments, (ii)
information regarding how the Funds voted proxies relating to portfolio
securities held during the twelve-month period ended June 30, 2009, and (iii) a
description of the policies and procedures that the Funds used to determine how
to vote proxies relating to portfolio securities 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 (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 100 F Street NE, Washington, D.C. 20549.
CEO CERTIFICATION DISCLOSURE
Each Fund's Chief Executive Officer has submitted to the New York Stock Exchange
(NYSE) the annual CEO certification as required by Section 303A.12(a) of the
NYSE Listed Company Manual.
Each Fund has filed with the SEC the certification of its Chief Executive
Officer and Chief Financial Officer required by Section 302 of the
Sarbanes-Oxley Act.
SHARE INFORMATION
Each Fund intends to repurchase shares of its own common stock in the future at
such times and in such amounts as is deemed advisable. During the period covered
by this report, the Funds did not repurchase any of their common shares.
Any future repurchases will be reported to shareholders in the next annual or
semi-annual report.
Nuveen Investments 81
Nuveen Investments:
Serving Investors for Generations
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.
Nuveen Investments is a global investment management firm that seeks to help
secure the long-term goals of institutions and high net worth investors as well
as the consultants and financial advisors who serve them. Nuveen Investments
markets its growing range of specialized investment solutions under the
high-quality brands of HydePark, NWQ, Nuveen, Santa Barbara, Symphony,
Tradewinds and Winslow Capital. In total, the Company managed $141 billion of
assets on September 30, 2009.
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.
Learn more about Nuveen Funds at: WWW.NUVEEN.COM/CEF
o Share prices
o Fund details
o Daily financial news
o Investor education
o Interactive planning tools
Distributed by
Nuveen Investments, LLC
333 West Wacker Drive
Chicago, IL 60606 It's not what you earn,
www.nuveen.com it's what you keep.(R)
EAN-A-1009D
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/CEF/Info/Shareholder.
(To view the code, 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 ("Board") 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, 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 Municipal Value Fund 2
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 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 (1) BILLED TO FUND (2) BILLED TO FUND (3) BILLED TO FUND
------------------------------------------------------------------------------------------------------------------------------------
October 31, 2009 (4) $ 12,962 $ 0 $ 0 $ 0
------------------------------------------------------------------------------------------------------------------------------------
Percentage approved 0% 0% 0% 0%
pursuant to
pre-approval
exception
------------------------------------------------------------------------------------------------------------------------------------
October 31, 2008 N/A N/A N/A N/A
------------------------------------------------------------------------------------------------------------------------------------
Percentage approved 0% 0% 0% 0%
pursuant to
pre-approval
exception
------------------------------------------------------------------------------------------------------------------------------------
(1) "Audit Fees" are the aggregate fees billed for professional services for
the audit of the Fund's annual financial statements and services provided
in connection with statutory and regulatory filings or engagements.
(2) "Audit Related Fees" are the aggregate fees billed for assurance and
related services reasonably related to the performance of the audit or
review of financial statements and are not reported under "Audit Fees."
(3) "Tax Fees" are the aggregate fees billed for professional services for tax
advice, tax compliance, and tax planning.
(4) The fund commenced operations on February 25, 2009.
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 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, 2009 (1) $ 0 $ 0 $ 0
------------------------------------------------------------------------------------------------------------------------------------
Percentage approved 0% 0% 0%
pursuant to
pre-approval
exception
------------------------------------------------------------------------------------------------------------------------------------
October 31, 2008 N/A N/A N/A
------------------------------------------------------------------------------------------------------------------------------------
Percentage approved 0% 0% 0%
pursuant to
pre-approval
exception
------------------------------------------------------------------------------------------------------------------------------------
(1) The fund commenced operations on February 25, 2009.
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. 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 pre-approval 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, 2009 (1) $ 0 $ 0 $ 0 $ 0
October 31, 2008 N/A N/A N/A N/A
"Non-Audit Fees billed to Fund" for both fiscal year ends represent "Tax Fees"
and "All Other Fees" billed to Fund in their respective amounts from the
previous table.
(1) The fund commenced operations on February 25, 2009.
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 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, Jack B. Evans, Terence J. Toth, William J. Schneider and
David J. Kundert.
ITEM 6. SCHEDULE OF INVESTMENTS.
a) See Portfolio of Investments in Item 1.
b) Not applicable.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
The registrant invests its assets primarily in municipal bonds and cash
management securities. On rare occasions the registrant may acquire, directly or
through a special purpose vehicle, equity securities of a municipal bond issuer
whose bonds the registrant already owns when such bonds have deteriorated or are
expected shortly to deteriorate significantly in credit quality. The purpose of
acquiring equity securities generally will be to acquire control of the
municipal bond issuer and to seek to prevent the credit deterioration or
facilitate the liquidation or other workout of the distressed issuer's credit
problem. In the course of exercising control of a distressed municipal issuer,
NAM may pursue the registrant's interests in a variety of ways, which may entail
negotiating and executing consents, agreements and other arrangements, and
otherwise influencing the management of the issuer. NAM does not consider such
activities proxy voting for purposes of Rule 206(4)-6 under the 1940 Act, but
nevertheless provides reports to the registrant's Board on its control
activities on a quarterly basis.
In the rare event that a municipal issuer were to issue a proxy or that the
registrant were to receive a proxy issued by a cash management security, NAM
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 registrant's Board or its representative. A member of NAM's legal department
would oversee the administration of the voting, and ensure that records were
maintained in accordance with Rule 206(4)-6, reports were filed with the SEC on
Form N-PX, and the results provided to the registrant's Board and made available
to shareholders as required by applicable rules.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
THE PORTFOLIO MANAGER
The following individual has primary responsibility for the day-to-day
implementation of the registrant's investment strategies:
NAME FUND
THOMAS SPALDING Nuveen Municipal Value Fund 2
Other Accounts Managed. In addition to managing the registrant, the portfolio
manager is also primarily responsible for the day-to-day portfolio management of
the following accounts:
TYPE OF ACCOUNT NUMBER OF
PORTFOLIO MANAGER MANAGED ACCOUNTS ASSETS
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Thomas Spalding Registered Investment Company 11 $9.0 billion
Other Pooled Investment Vehicles 0 $0
Other Accounts 4 $16.6 million
* Assets are as of October 31, 2009. None of the assets in these accounts are
subject to an advisory fee based on performance.
Compensation. Each portfolio manager's compensation consists of three basic
elements--base salary, cash bonus and long-term incentive compensation. The
compensation strategy is to annually compare overall compensation, including
these three elements, to the market in order to create a compensation structure
that is competitive and consistent with similar financial services companies. As
discussed below, several factors are considered in determining each portfolio
manager's total compensation. In any year these factors may include, among
others, the effectiveness of the investment strategies recommended by the
portfolio manager's investment team, the investment performance of the accounts
managed by the portfolio manager, and the overall performance of Nuveen
Investments, Inc. (the parent company of NAM). Although investment performance
is a factor in determining the portfolio manager's compensation, it is not
necessarily a decisive factor. The portfolio manager's performance is evaluated
in part by comparing manager's performance against a specified investment
benchmark. This fund-specific benchmark is a customized subset (limited to bonds
in each Fund's specific state and with certain maturity parameters) of the
S&P/Investortools Municipal Bond index, an index comprised of bonds held by
managed municipal bond fund customers of Standard & Poor's Securities Pricing,
Inc. that are priced daily and whose fund holdings aggregate at least $2
million. As of October 31, 2009, the S&P/Investortools Municipal Bond index was
comprised of 54,552 securities with an aggregate current market value of $1,178
billion.
Base salary. Each portfolio manager is paid a base salary that is set at a level
determined by NAM in accordance with its overall compensation strategy discussed
above. NAM is not under any current contractual obligation to increase a
portfolio manager's base salary.
Cash bonus. Each portfolio manager is also eligible to receive an annual cash
bonus. The level of this bonus is based upon evaluations and determinations made
by each portfolio manager's supervisors, along with reviews submitted by his
peers. These reviews and evaluations often take into account a number of
factors, including the effectiveness of the investment strategies recommended to
the NAM's investment team, the performance of the accounts for which he serves
as portfolio manager relative to any benchmarks established for those accounts,
his effectiveness in communicating investment performance to stockholders and
their representatives, and his contribution to the NAM's investment process and
to the execution of investment strategies. The cash bonus component is also
impacted by the overall performance of Nuveen Investments, Inc. in achieving its
business objectives.
Long-term incentive compensation. In connection with the acquisition of Nuveen
Investments, Inc., by a group of investors led by Madison Dearborn Partners in
November 2007, certain employees, including portfolio managers, received profit
interests in Nuveen's parent. These profit interests entitle the holders to
participate in the appreciation in the value of Nuveen beyond the issue date and
vest over five to seven years, or earlier in the case of a liquidity event. In
addition, in July 2009, Nuveen Investments created and funded a trust, as part
of a newly-established incentive program, which purchased shares of certain
Nuveen Mutual Funds and awarded such shares, subject to vesting, to certain
employees, including portfolio managers.
Material Conflicts of Interest. Each portfolio manager's simultaneous management
of the registrant and the other accounts noted above may present actual or
apparent conflicts of interest with respect to the allocation and aggregation of
securities orders placed on behalf of the registrant and the other account. NAM,
however, believes that such potential conflicts are mitigated by the fact that
the NAM has adopted several policies that address potential conflicts of
interest, including best execution and trade allocation policies that are
designed to ensure (1) that portfolio management is seeking the best price for
portfolio securities under the circumstances, (2) fair and equitable allocation
of investment opportunities among accounts over time and (3) compliance with
applicable regulatory requirements. All accounts are to be treated in a
non-preferential manner, such that allocations are not based upon account
performance, fee structure or preference of the portfolio manager, although the
allocation procedures may provide allocation preferences to funds with special
characteristics (such as favoring state funds versus national funds for
allocations of in-state bonds). In addition, NAM has adopted a Code of Conduct
that sets forth policies regarding conflicts of interest.
Beneficial Ownership of Securities. As of October 31, 2009, the portfolio
manager beneficially owned the following dollar range of equity securities
issued by the registrant and other Nuveen Funds managed by NAM's municipal
investment team.
DOLLAR RANGE OF
EQUITY SECURITIES
DOLLAR RANGE OF BENEFICIALLY OWNED IN
EQUITY THE REMAINDER OF
SECURITIES NUVEEN FUNDS MANAGED
NAME OF PORTFOLIO BENEFICIALLY BY NAM'S MUNICIPAL
MANAGER FUND OWNED IN FUND INVESTMENT TEAM
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Thomas Spalding Nuveen Municipal Value Fund 2 $0 Over $1,000,000
PORTFOLIO MANAGER BIO:
Thomas Spalding, CFA, is Vice President and Senior Investment Officer of Nuveen
Investments. He has direct investment responsibility for the National Long Term
funds. He joined Nuveen in 1976 as assistant portfolio manager and has been the
portfolio manager of the Nuveen Municipal Value Fund, Nuveen's first closed-end
exchange traded fund, since its inception in 1987. Currently, he manages
investments for 12 Nuveen-sponsored investment companies.
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/CEF/Info/
Shareholder and there were no amendments during the period covered by this
report. (To view the code, 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 Municipal Value Fund 2
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By (Signature and Title) /s/ Kevin J. McCarthy
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Kevin J. McCarthy
Vice President and Secretary
Date: January 8, 2010
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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
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Gifford R. Zimmerman
Chief Administrative Officer
(principal executive officer)
Date: January 8, 2010
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By (Signature and Title) /s/ Stephen D. Foy
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Stephen D. Foy
Vice President and Controller
(principal financial officer)
Date: January 8, 2010
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