-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, QXtk9B5hd3ZeroHL4Qw9ZOpcDOKmi9wRIk2fZZG/+RGCTgYx60T8ycrj/Nc5brPK ArxbJjL0oYfew7tW1SDcXQ== 0000891804-02-000003.txt : 20020413 0000891804-02-000003.hdr.sgml : 20020413 ACCESSION NUMBER: 0000891804-02-000003 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20011031 FILED AS OF DATE: 20020103 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NUVEEN MUNICIPAL INCOME FUND INC CENTRAL INDEX KEY: 0000830271 STANDARD INDUSTRIAL CLASSIFICATION: [] STATE OF INCORPORATION: MN FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-05488 FILM NUMBER: 2500970 BUSINESS ADDRESS: STREET 1: 333 W WACKER DR CITY: CHICAGO STATE: IL ZIP: 60606 BUSINESS PHONE: 3129178200 N-30D 1 nv25590ed.txt FAN-1-10-01 ANNUAL REPORT October 31, 2001 Logo: NUVEEN Investments Municipal Closed-End Exchange-Traded Funds Dependable, tax-free income to help you keep more of what you earn. MUNICIPAL VALUE NUV MUNICIPAL INCOME NMI Photo of: 2 girls reading a book. Photo of: Woman reading a book to 4 children. Invest well. Look ahead. LEAVE YOUR MARK.(SM) Less Mail, More Freedom with online fund reports photo: clouds photo: hand on PC mouse There is a new way to receive your Nuveen Fund updates faster than ever. Nuveen now can link you with electronic versions of the important financial information we send you by regular mail. By registering for online access via the internet, you will be able to view and save the Fund information you currently receive in the mail. This information can be stored on your computer and retrieved any time. In addition, you can select only the specific pages you want to view or print. With this new service, you'll receive an e-mail notice the moment Fund reports are ready. This notice will contain a link to the report - all you have to do is click your computer mouse on the internet address provided. You'll be saving time, as well as saving your Fund paper, printing and distribution expenses. Registering for electronic access is easy and only takes a few minutes. (see box at right) The e-mail address you provide is strictly confidential and will not be used for anything other than notifications of shareholder information. And if you decide you don't like receiving your reports electronically, it's a simple process to go back to regular mail delivery. SIGN UP TODAY--Here's what you need to do... If your Nuveen Fund dividends are PAID TO YOUR BROKERAGE ACCOUNT, follow the steps outlined below: 1 Go to WWW.INVESTORDELIVERY.COM 2 Look at the address sheet that accompanied this report. Enter the personal 13-CHARACTER ENROLLMENT NUMBER imprinted near your name on the address sheet. 3 You'll be taken to a page with several options. Select the NEW ENROLLMENT-CREATE screen. Once there, enter your e-mail address (e.g. yourID@providerID.com), and a personal, 4-digit PIN of your choice. (Pick a number that's easy to remember.) 4 Click Submit. Confirm the information you just entered is correct, then click Submit again. 5 You should get a confirmation e-mail within 24 hours. If you do not, go back through these steps to make sure all the information is correct. 6 Use this same process if you need to change your registration information or cancel internet viewing. If your Nuveen Fund dividends COME DIRECTLY TO YOU FROM NUVEEN, follow the steps outlined below: 1 Go to WWW.NUVEEN.COM 2 Select the Access Account tab. Select the E-REPORT ENROLLMENT section. Click on Enrollment Page. 3 You'll be taken to a screen that asks for your social security number and e-mail address. Fill in this information, then click Enroll. 4 You should get a confirmation e-mail within 24 hours. If you do not, go back through these steps to make sure all the information is correct. 5 Use this same process if you need to change your registration information or cancel internet viewing. Photo of: Timothy R. Schwertfeger Chairman of the Board Sidebar text: "A diversified portfolio can leave you well positioned to reduce overall investment risk." Dear Shareholder In the aftermath of September 11, the financial markets have reacted with volatility and uncertainty as investors attempt to better understand how the U.S. and world economies are likely to perform in the months ahead. It's too soon to tell what the long-term impact will be on the markets or your Fund, but one thing that is increasingly clear to us is that a diversified portfolio that includes high quality municipal bonds can leave you well positioned to reduce overall investment volatility. For example, during the period covered by this report, all of these Nuveen Funds continued to meet their primary objectives of providing attractive monthly income from a portfolio of high quality municipal bonds. Detailed information on your Fund's performance can be found in the Portfolio Managers' Comments and Performance Overview sections of this report. I urge you to take the time to read them. In addition to providing you with steady tax-free income, your Nuveen Fund also features several characteristics that can help make it an essential part of your overall investment strategy. These include careful research, constant surveillance and judicious trading by Nuveen's seasoned portfolio management team, with every action designed to supplement income, improve Fund structure, better adapt to current market conditions or increase diversification. In turbulent times like these, prudent investors understand the importance of diversification, balance, and risk management, all attributes your Nuveen Fund can bring to your portfolio. For more than 100 years, Nuveen has specialized in offering quality investments such as these Nuveen Funds to those seeking to accumulate and preserve wealth and establish a lasting legacy. Our mission continues to be to assist you and your financial advisor by offering the investment services and products that can help you invest well and leave your mark for future generations. We thank you for continuing to choose Nuveen Investments as your partner as you work toward that goal. Sincerely, /s/ Timothy R. Schwertfeger Timothy R. Schwertfeger Chairman of the Board December 15, 2001 Sidebar text: "Today, perhaps more than ever, investors have the ability to make a lasting impact on their families and their world for generations to come." Nuveen National Municipal Closed-End Exchange-Traded Funds (NUV, NMI) Portfolio Managers' Comments Portfolio managers Tom Spalding and John Miller examine economic and market conditions, key investment strategies, and the performance of the Nuveen Municipal Value Fund, Inc. (NUV) and the Nuveen Municipal Income Fund, Inc. (NMI). Tom, who has 25 years of investment experience with Nuveen, has managed NUV since its inception in 1987. John is a 6-year veteran of Nuveen and assumed portfolio management responsibility for NMI in 2001. WHAT FACTORS HAD THE GREATEST INFLUENCE ON THE U.S. ECONOMY AND THE MUNICIPAL MARKET DURING THIS REPORTING PERIOD? The two major forces at work during the twelve months ended October 31, 2001, were the continued slowdown in economic growth and the Federal Reserve's aggressive approach to easing short-term interest rates. While these two factors had a great impact over the entire period covered in this report, the tragic events of September 11 and its aftermath also have had a profound effect on the economy and the markets. In January 2001, the Fed embarked on a series of interest rate cuts designed to stimulate the sluggish U.S. economy. During the first ten months of the year, the Fed announced nine reductions totaling 400 basis points, bringing the federal funds rate to 2.50% as of October 31, 2001. (On November 6, 2001, following the end of the period covered in this report, the Fed reduced the fed funds rate to 2.00%, its lowest level since 1961.) The consensus among many market observers is that the Fed could decide to cut rates again if signs of a significant economic slowdown continue. In the municipal market, the general environment of the past twelve months has helped many fixed-income securities perform well. The interest rate cuts created favorable conditions for both new municipal bond issuance and refundings, which together totaled $223.4 billion nationwide through the first ten months of 2001, an increase of 36% over January-October 2000. On the demand side, municipal bonds continued to be highly sought after by individual investors looking for diversification, tax-free income, quality, and an alternative to a volatile stock market. Institutional investors, especially insurance companies, also have been active buyers in the new issue market. In general, strong demand has proven more powerful than increased supply, which has helped keep municipal bond prices higher than they were twelve months ago. HOW DID THESE TWO NUVEEN NATIONAL FUNDS PERFORM OVER THE PAST TWELVE MONTHS? For the year ended October 31, 2001, NUV and NMI produced annual total returns on net asset value (NAV) as shown in the accompanying table. The annual returns for the Lehman Brothers Municipal Bond Index1 and relevant Lipper Peer Group2 are also presented. MARKET TOTAL RETURN LEHMAN LIPPER YIELD ON NAV TOTAL RETURN1 AVERAGE2 - ----------------------------------------------------------------- 1 YEAR 1 YEAR 1 YEAR TAXABLE- ENDED ENDED ENDED 10/31/01 EQUIVALENT3 10/31/01 10/31/01 10/31/01 - ----------------------------------------------------------------- NUV 5.38% 7.74% 9.77% 10.51% 8.24% - ----------------------------------------------------------------- NMI 5.65% 8.13% 5.68% 10.51% 8.24% - ----------------------------------------------------------------- Past performance is not predictive of future results. For additional information, see the individual Performance Overview for your Fund in this report. Over the past twelve months, the Fed's change in policy from tightening to easing, combined with favorable market technicals, created a generally positive total return environment for municipal bonds. The Funds' participation in the market's gains is reflected, in part, in the total returns on NAV listed in the previous table. In a market characterized by rising bond values and falling yields, funds or indexes with longer durations would typically be expected to outperform funds or indexes with shorter durations. As of October 31, 2001, the durations4 of NUV and NMI were 5.69 and 6.98, respectively, compared with 7.77 for the Lehman Municipal Bond Index. While duration was one primary driver of total return over the past twelve months, the structures and individual holdings of these Funds also influenced their performance. 1 The performances of NUV and NMI are compared with that of the Lehman Brothers Municipal Bond Index, an unleveraged index comprising a broad range of investment-grade municipal bonds. Results for the Lehman index do not reflect any expenses. 2 The total returns of these Funds are compared with the average annualized return of the twelve funds in the Lipper General and Insured Unleveraged Municipal Debt Funds category. Fund and Lipper returns assume reinvestment of dividends. 3 The taxable-equivalent yield represents the yield that must be earned on a taxable investment in order to equal the yield of the Nuveen Fund on an after-tax basis. The taxable-equivalent yield is based on the Fund's market yield on the indicated date and a federal income tax rate of 30.5%. 4 Duration is a measure of a Fund's NAV volatility in reaction to interest rate movements. For example, credit issues involving bonds issued by the California Pollution Control Financing Authority for the CanFibre of Riverside project impacted NMI's return. These holdings were adversely affected by the bankruptcy filing of the project's general contractor and by the California energy crisis, which raised the power costs and hampered plant operations. Nuveen has been actively involved in facilitating a resolution that we believe will serve the best interests of NMI shareholders. NMI also continues to hold bonds issued by the Erie County (New York) Industrial Development Agency for CanFibre of Lackawanna. While this plant also was affected by the situation in California, it is currently in operation and functioning as designed. We continue to monitor this holding very closely and remain cautiously optimistic that the situation there will improve. It is important to note that, despite these credit issues, NMI continues to offer shareholders attractive tax-free dividends paid on a regular monthly basis. HOW DID THE MARKET ENVIRONMENT AFFECT THESE FUNDS' DIVIDENDS AND SHARE PRICES? As of October 31, 2001, NUV had provided shareholders with 36 consecutive months of steady dividends. For NMI, a reduced income stream from the previously mentioned credit issues as well as bond call proceeds that had to be reinvested in the current low interest rate environment led to a dividend adjustment in September 2001. Prior to this adjustment, NMI had offered 38 consecutive months of stable or increasing dividends. In the coming months, the number of bond calls and the interest rates at which we can reinvest the proceeds of any calls ultimately may influence the dividends of these Nuveen Funds. During the past year, as the stock market remained volatile and the bond market continued to perform well, many investors turned to tax-free fixed-income investments as a way to add balance to their portfolios and reduce their overall portfolio risk. As a result, the share prices of both NUV and NMI improved (see the charts on the individual Performance Overview pages). The increased demand caused the discount (share price below NAV) on NUV to narrow over the past twelve months, while NMI continued to trade at a premium (share price above NAV). WHAT KEY STRATEGIES WERE USED TO MANAGE NUV AND NMI DURING THE YEAR ENDED OCTOBER 31, 2001? One of our areas of emphasis during the past twelve months was to work through bond calls and improve the call protection within both Funds. Over the 14 months, NUV and NMI offer excellent levels of call protection, with bond calls potentially affecting just 18% and 9%, respectively, of their portfolios between November 2001 and December 2002. The number of actual calls experienced by these Funds will depend largely on market interest rates over this period. Given the current level of rates, our general approach has been to hold higher-yielding bonds as long as possible to help support the Funds' dividends, while we look for attractive replacement opportunities. Expectations for continued strong municipal issuance should help support our execution of this strategy. In general, we believe these call positions are very manageable. In investing call proceeds and new cash over the past twelve months, we focused on finding attractive bonds with the potential to support the Funds' long-term dividend-payment capabilities, while adding value and enhancing diversification. Among the areas of the market where we found value was the healthcare sector, as well as other sectors regarded as providers of essential services, such as education, water and sewer, and utilities. As of October 31, 2001, both Funds listed healthcare and utilities among their top three sector holdings. In NMI, our healthcare holdings included West Penn Allegheny Health System bonds issued by the Allegheny County (Pennsylvania) Hospital Development Authority. These Pittsburgh hospital bonds have been working well for the Fund, as they continue to trade at improving prices. Another area that performed well and contributed to diversification was the tobacco sector, and we took advantage of several new offerings in the primary market to purchase additional tobacco settlement bonds at very attractive yields for NUV. The proceeds from these bonds, which are secured by a state's share of payments under the $250 billion master settlement agreement between four major tobacco companies and 46 states, are used for various purposes, including education and healthcare. Tobacco bonds now make up about 1.5% of NUV's portfolio, and we plan to continue to add to our position as we find attractive opportunities. In view of recent events, shareholders should note that both NUV and NMI continue to offer strong credit quality, with allocations of bonds rated AAA/U.S. guaranteed, AA, and A of 83% and 44%, respectively, as of October 31, 2001. Each Fund also had assets invested in the BBB and non-rated credit categories, which generally benefited from narrowing credit spreads during the first part of 2001. Both NUV and NMI also had some exposure to bonds and sectors affected by the events of September 11, including New York City general obligation bonds and selected airport and airline issues. As of October 31, 2001, credit ratings for New York City had not been downgraded, remaining at A2/A/A+. On October 2, New York City successfully brought to market $1 billion in one-year disaster recovery notes. This issue, which had been closely watched as a barometer of the financial viability of the city going forward, sold rapidly to both individual and institutional investors, demonstrating the general belief that New York City continues to represent a strong credit despite recent events. Although Standard & Poor's placed all major air carriers and North American airports on credit watch following September 11, Moody's current median rating for airports is A2, which is solidly investment grade. In addition, the commitment to the air transportation sector at the federal level was demonstrated by the approval of a $15 billion airline aid package of grants and loan guarantees. WHAT IS YOUR OUTLOOK FOR THE MUNICIPAL MARKET IN GENERAL AND NUV AND NMI IN PARTICULAR? In general, our outlook for the fixed-income markets over the next twelve months remains positive. Although the long-term economic effects of September 11 are still being assessed, we believe the U.S. economy is headed for an eventual recovery, but one that may see a slower pace of growth, with inflation and interest rates remaining low over the near term. New municipal issuance should continue to be strong during the fourth quarter and into 2002, and municipal supply nationwide in 2001 is now expected to exceed $250 billion for the first time since 1998. At the same time, demand for tax-exempt municipal bonds is anticipated to remain firm, as investors look for ways to rebalance their portfolios and reduce risk. The federal government's recent decision to discontinue the 30-year Treasury bond removed one of the pricing benchmarks for the municipal market. This may result in some pricing uncertainty, which could create additional opportunities to find value for shareholders. Overall, we continue to watch the fixed-income markets carefully, especially those sectors that were directly impacted by the events of September 11 or that may be affected by any further deceleration in the economy. We believe NUV and NMI currently are well diversified and well positioned for the market environment ahead, and we will continue to closely monitor and respond to events as appropriate. Over the next six months, we plan to remain focused on the strategies that add value for our shareholders, provide support for the Funds' dividends, and fully utilize Nuveen's experience and research expertise to adjust to any shifts in market conditions. One of our priorities will be managing portfolio structure, including duration, to strategically position the Funds for a potential economic recovery. Shareholders can expect to see these Funds' durations lengthen somewhat as part of the normal process of reinvesting proceeds from called bonds into intermediate and longer-term issues. Overall, we believe NUV and NMI can continue to play an important role in investors' long-range financial programs, providing balance and diversification, dependable tax-free income, quality investments, and a measure of security in uncertain times. Nuveen Municipal Value Fund, Inc. Performance Overview As of October 31, 2001 NUV Pie Chart: CREDIT QUALITY AAA/U.S. Guaranteed 42% AA 20% A 21% BBB 11% NR 3% Other 3% PORTFOLIO STATISTICS - -------------------------------------------------- Share Price $9.48 - -------------------------------------------------- Net Asset Value $10.17 - -------------------------------------------------- Market Yield 5.38% - -------------------------------------------------- Taxable-Equivalent Yield (Federal Income Tax Rate)1 7.74% - -------------------------------------------------- Fund Net Assets ($000) $1,982,139 - -------------------------------------------------- Average Effective Maturity (Years) 18.83 - -------------------------------------------------- Average Duration 5.69 - -------------------------------------------------- ANNUALIZED TOTAL RETURN (Inception 6/87) - -------------------------------------------------- ON SHARE PRICE ON NAV - -------------------------------------------------- 1-Year 17.32% 9.77% - -------------------------------------------------- 5-Year 6.91% 6.14% - -------------------------------------------------- 10-Year 5.37% 6.34% - -------------------------------------------------- TOP FIVE SECTORS (as a % of total investments) - -------------------------------------------------- Utilities 30% - -------------------------------------------------- Healthcare 16% - -------------------------------------------------- Tax Obligation/Limited 12% - -------------------------------------------------- U.S.Guaranteed 10% - -------------------------------------------------- Transportation 8% - -------------------------------------------------- Bar Chart: 2000-2001 MONTHLY TAX-FREE DIVIDENDS PER SHARE2 11/00 0.0425 12/00 0.0425 1/01 0.0425 2/01 0.0425 3/01 0.0425 4/01 0.0425 5/01 0.0425 6/01 0.0425 7/01 0.0425 8/01 0.0425 9/01 0.0425 10/01 0.0425 SHARE PRICE PERFORMANCE 11/1/00 8.63 8.69 8.63 8.5 8.5 8.56 8.75 8.75 9 9.13 9.13 9.13 9.33 9.37 9.19 9.2 9.19 9.27 9.2 9.21 9.25 9.18 8.98 9.08 9.1 9.11 9.07 9.16 9.1 9.2 9.26 9.24 9.23 9.22 9.2 9.25 9.31 9.28 9.36 9.47 9.46 9.53 9.54 9.55 9.55 8.9 9.26 9.46 9.22 9.38 10/31/01 9.42 Weekly Closing Price Past performance is not predictive of future results. 1 Taxable-equivalent yield represents the yield on a taxable investment necessary to equal the yield of the Nuveen Fund on an after-tax basis. It is calculated using the current market yield and a federal income tax rate of 30.5%. 2 The Fund also paid shareholders capital gains and net ordinary income distributions in December 2000 of $0.0236 per share. Nuveen Municipal Income Fund, Inc. Performance Overview As of October 31, 2001 NMI Pie Chart: CREDIT QUALITY AAA/U.S. Guaranteed 25% AA 3% A 16% BBB 24% NR 29% Other 3% PORTFOLIO STATISTICS - -------------------------------------------------- Share Price $11.90 - -------------------------------------------------- Net Asset Value $10.92 - -------------------------------------------------- Market Yield 5.65% - -------------------------------------------------- Taxable-Equivalent Yield (Federal Income Tax Rate)1 8.13% - -------------------------------------------------- Fund Net Assets ($000) $88,089 - -------------------------------------------------- Average Effective Maturity (Years) 17.67 - -------------------------------------------------- Average Duration 6.98 - -------------------------------------------------- ANNUALIZED TOTAL RETURN (Inception 4/88) - -------------------------------------------------- ON SHARE PRICE ON NAV - -------------------------------------------------- 1-Year 12.24% 5.68% - -------------------------------------------------- 5-Year 6.40% 4.79% - -------------------------------------------------- 10-Year 6.16% 5.81% - -------------------------------------------------- TOP FIVE SECTORS (as a % of total investments) - -------------------------------------------------- Utilities 20% - -------------------------------------------------- Tax Obligation/General 14% - -------------------------------------------------- Healthcare 11% - -------------------------------------------------- U.S.Guaranteed 10% - -------------------------------------------------- Transportation 9% - -------------------------------------------------- Bar Chart: 2000-2001 MONTHLY TAX-FREE DIVIDENDS PER SHARE 11/00 0.0585 12/00 0.0585 1/01 0.0585 2/01 0.0585 3/01 0.0585 4/01 0.0585 5/01 0.0585 6/01 0.0585 7/01 0.0585 8/01 0.0585 9/01 0.056 10/01 0.056 Line Chart: SHARE PRICE PERFORMANCE 11/1/00 11.31 11.19 11.19 11.25 11 11 11.38 11.69 11.94 12 12.13 11.94 11.97 11.91 11.75 11.72 11.75 11.79 11.8 11.75 11.84 11.82 11.67 11.45 11.51 11.7 11.91 11.95 11.56 11.65 11.71 11.8 11.82 11.94 11.9 12.01 11.98 11.95 12.04 12.1 11.91 12.04 12.05 11.95 11.9 11.36 11.64 11.67 11.89 11.9 10/31/01 11.82 Weekly Closing Price Past performance is not predictive of future results. 1 Taxable-equivalent yield represents the yield on a taxable investment necessary to equal the yield of the Nuveen Fund on an after-tax basis. It is calculated using the current market yield and a federal income tax rate of 30.5%. Shareholder Meeting Report The annual shareholder meeting was held on August 1, 2001, at the Northern Trust Bank, Chicago, Illinois. NUV NMI - -------------------------------------------------------------------------------- APPROVAL OF THE BOARD MEMBERS WAS REACHED AS FOLLOWS: Common Common Shares Shares ================================================================================ Lawrence H. Brown For 161,013,677 6,643,854 Withhold 1,441,288 52,168 - -------------------------------------------------------------------------------- Total 162,454,965 6,696,022 ================================================================================ Peter R. Sawers For 160,943,598 6,648,154 Withhold 1,511,367 47,868 - -------------------------------------------------------------------------------- Total 162,454,965 6,696,022 ================================================================================ Timothy R. Schwertfeger For 161,074,687 6,646,879 Withhold 1,380,278 49,143 - -------------------------------------------------------------------------------- Total 162,454,965 6,696,022 ================================================================================ RATIFICATION OF AUDITORS WAS REACHED AS FOLLOWS: For 160,907,978 6,596,702 Against 644,263 22,163 Abstain 902,724 77,157 - -------------------------------------------------------------------------------- Total 162,454,965 6,696,022 ================================================================================ Report of Independent Auditors THE BOARD OF DIRECTORS AND SHAREHOLDERS NUVEEN MUNICIPAL VALUE FUND, INC. NUVEEN MUNICIPAL INCOME FUND, INC. We have audited the accompanying statements of net assets, including the portfolios of investments, of Nuveen Municipal Value Fund, Inc. and Nuveen Municipal Income Fund, Inc. as of October 31, 2001, and the related statements of operations, changes in net assets and the financial highlights for the years 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 auditing standards generally accepted in the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of investments owned as of October 31, 2001, by correspondence with the custodian and brokers or alternative procedures when broker confirmations were not readily available. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial positions of Nuveen Municipal Value Fund, Inc. and Nuveen Municipal Income Fund, Inc. at October 31, 2001, and the results of their operations, changes in their net assets and financial highlights for the years indicated therein in conformity with accounting principles generally accepted in the United States. /s/ Ernst & Young LLP Chicago, Illinois December 7, 2001 Nuveen Municipal Value Fund, Inc. (NUV) Portfolio of Investments October 31, 2001
PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ ALABAMA - 1.2% $ 2,140 Alabama Housing Finance Authority, Single Family Mortgage 4/08 at 102 Aaa $ 2,163,198 Revenue Bonds (Collateralized Home Mortgage Revenue Bond Program), 1998 Series A-2, 5.450%, 10/01/28 (Alternative Minimum Tax) 5,000 The Industrial Development Board of the Town of Courtland, Alabama, 11/09 at 101 Baa2 5,313,150 Solid Waste Disposal Revenue Bonds (Champion International Paper Corporation Project), Series 1999A, 6.700%, 11/01/29 (Alternative Minimum Tax) 4,000 The Medical Clinic Board of the City of Jasper, Alabama, Hospital 7/02 at 102 Baa1 4,084,840 Revenue Bonds, Series 1993 (Walker Regional Medical Center, Inc. Project), 6.375%, 7/01/18 12,000 Jefferson County, Alabama, Sewer Revenue Capital Improvement 2/09 at 101 AAA 12,327,240 Warrants, Series 1999-A, 5.375%, 2/01/36 - ------------------------------------------------------------------------------------------------------------------------------------ ARIZONA - 1.4% 4,900 Arizona Health Facilities Authority, Hospital Revenue Bonds 11/09 at 100 A3 5,118,246 (Phoenix Children's Hospital), Series 1999A, 6.250%, 11/15/29 16,000 Arizona Health Facilities Authority, Revenue Bonds (Catholic 7/10 at 101 BBB 16,904,000 Healthcare West), 1999 Series A, 6.625%, 7/01/20 4,975 Yuma Regional Medical Center on behalf of Hospital District No. 1 8/02 at 101 1/2 N/R*** 5,267,630 of Yuma County, Arizona, Hospital Revenue Improvement and Refunding Bonds (Yuma Regional Medical Center Project), Series 1992, 8.000%, 8/01/17 (Pre-refunded to 8/01/02) - ------------------------------------------------------------------------------------------------------------------------------------ ARKANSAS - 0.2% 1,400 City of Conway, Arkansas, Sales and Use Tax Capital Improvement 12/06 at 101 AAA 1,448,426 Bonds, Series 1997A, 5.350%, 12/01/17 2,750 Jefferson County, Arkansas, Pollution Control Revenue Refunding 12/02 at 102 BBB- 2,698,795 Bonds (Entergy Arkansas, Inc. Project), Series 1997, 5.600%, 10/01/17 - ------------------------------------------------------------------------------------------------------------------------------------ CALIFORNIA - 6.9% California Educational Facilities Authority, Revenue Bonds (Loyola Marymount University), Series 2000: 3,655 0.000%, 10/01/23 10/09 at 41 13/16 Aaa 1,136,961 7,310 0.000%, 10/01/24 10/09 at 39 3/16 Aaa 2,130,573 9,000 State of California Department of Water Resources, Water System 6/03 at 101 1/2 AA 9,308,970 Revenue Bonds (Central Valley Project), Series L, 5.750%, 12/01/19 14,500 State of California Department of Water Resources, Water System 12/03 at 101 AA 14,349,055 Revenue Bonds (Central Valley Project), Series M, 4.750%, 12/01/24 17,155 State Public Works Board of the State of California, Lease Revenue 6/03 at 102 Aa2 17,582,160 Refunding Bonds (The Regents of the University of California), 1993 Series A (Various University of California Projects), 5.500%, 6/01/21 15,500 California Statewide Communities Development Authority, 4/09 at 101 BBB 15,567,425 Certificates of Participation (The Internext Group), 5.375%, 4/01/17 6,530 California Statewide Communities Development Authority, 7/03 at 102 AA- 6,765,798 Certificates of Participation (St. Joseph Health System Obligated Group), 5.500%, 7/01/14 3,000 Community Facilities District No. 98-2 of the Capistrano Unified 9/09 at 102 N/R 3,000,840 School District, Ladera, California, Special Tax Bonds, Series 1999, 5.750%, 9/01/29 5,615 Central Joint Powers Health Financing Authority, Certificates 2/03 at 100 Baa1 5,281,974 of Participation, Series 1993 (Community Hospital of Central California), 5.000%, 2/01/23 Foothill/Eastern Transportation Corridor Agency, California, Toll Road Revenue Bonds, Series 1995A: 30,000 0.000%, 1/01/22 No Opt. Call AAA 10,685,400 2,500 6.000%, 1/01/34 (Pre-refunded to 1/01/07) 1/07 at 100 AAA 2,876,375 7,500 Department of Water and Power of the City of Los Angeles, 11/03 at 102 AAA 7,664,625 California, Electric Plant Refunding Revenue Bonds, Second Issue of 1993, 5.400%, 11/15/31 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ CALIFORNIA (continued) $ 30,470 Los Angeles County Public Works Financing Authority, California, 12/03 at 102 AAA $ 31,258,564 Lease Revenue Bonds (Multiple Capital Facilities Project IV), 4.750%, 12/01/13 7,300 County of San Diego, California, Certificates of Participation 9/09 at 101 Baa3 7,651,349 (The Burnham Institute), 6.250%, 9/01/29 1,930 Yuba County Water Agency, California, Yuba River Development No Opt. Call Ba3 1,720,769 Revenue Bonds, Series A, 4.000%, 3/01/16 - ------------------------------------------------------------------------------------------------------------------------------------ COLORADO - 7.7% 1,300 Colorado Educational and Cultural Facilities Authority (Boulder 8/11 at 100 Ba2 1,252,550 County, Colorado), Charter School Revenue Bonds (Peak to Peak Charter School Project created by Boulder Valley School District No. RE-2), 7.625%, 8/15/31 Colorado Health Facilities Authority, Revenue Bonds, Series 1994 (Sisters of Charity Health Care Systems, Inc.): 9,590 5.250%, 5/15/14 (Pre-refunded to 5/15/04) 5/04 at 102 AA-*** 10,386,258 2,925 5.250%, 5/15/14 5/04 at 102 AA- 2,977,445 500 Colorado Health Facilities Authority, Revenue Bonds (Vail Valley 1/12 at 100 BBB 500,715 Medical Center Project), Series 2001, 5.750%, 1/15/22 City and County of Denver, Colorado, Airport System Revenue Bonds, Series 1992B: 3,680 7.000%, 11/15/03 (Alternative Minimum Tax) 11/02 at 102 A 3,891,931 2,125 7.250%, 11/15/23 (Alternative Minimum Tax) (Pre-refunded to 11/15/02) 11/02 at 102 Aaa 2,276,746 8,290 7.250%, 11/15/23 (Alternative Minimum Tax) 11/02 at 102 A 8,796,353 City and County of Denver, Colorado, Airport System Revenue Bonds, Series 1992C: 655 6.750%, 11/15/13 (Alternative Minimum Tax) (Pre-refunded to 11/15/02) 11/02 at 102 Aaa 698,564 5,045 6.750%, 11/15/13 (Alternative Minimum Tax) 11/02 at 102 A 5,327,570 7,515 6.750%, 11/15/22 (Alternative Minimum Tax) (Pre-refunded to 11/15/02) 11/02 at 102 Aaa 8,014,823 29,870 6.750%, 11/15/22 (Alternative Minimum Tax) 11/02 at 102 A 31,543,019 City and County of Denver, Colorado, Airport System Revenue Bonds, Series 1991A: 3,475 8.750%, 11/15/23 (Alternative Minimum Tax) (Pre-refunded to 11/15/01) 11/01 at 102 Aaa 3,553,222 9,635 8.750%, 11/15/23 (Alternative Minimum Tax) (Pre-refunded to 11/15/01) 11/01 at 102 A*** 9,851,402 City and County of Denver, Colorado, Airport System Revenue Bonds, Series 1991D: 1,820 7.750%, 11/15/21 (Alternative Minimum Tax) (Pre-refunded to 11/15/01) 11/01 at 102 Aaa 1,860,295 6,930 7.750%, 11/15/21 (Alternative Minimum Tax) (Pre-refunded to 11/15/01) 11/01 at 102 A*** 7,083,084 10,275 7.000%, 11/15/25 (Alternative Minimum Tax) (Pre-refunded to 11/15/01) 11/01 at 100 Aaa 10,294,317 39,745 7.000%, 11/15/25 (Alternative Minimum Tax) (Pre-refunded to 11/15/01) 11/01 at 100 A*** 39,817,733 5,000 E-470 Public Highway Authority, Colorado, Senior Revenue Bonds, 9/10 at 102 AAA 5,414,400 Series 2000A, 5.750%, 9/01/35 - ------------------------------------------------------------------------------------------------------------------------------------ CONNECTICUT - 0.4% 6,640 Connecticut Housing Finance Authority, Housing Mortgage 5/06 at 102 AAA 6,971,668 Finance Program Bonds, 1996 Series D, Subseries D-2, 6.200%, 11/15/27 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ DISTRICT OF COLUMBIA - 1.3% 27,725 Washington Convention Center Authority (Washington, D.C.), 10/08 at 100 AAA 26,179,886 Senior Lien Dedicated Tax Revenue Bonds, Series 1998, 4.750%, 10/01/28 - ------------------------------------------------------------------------------------------------------------------------------------ FLORIDA - 2.9% 12,190 City of Jacksonville (Florida), Better Jacksonville Sales Tax Revenue 10/11 at 100 AAA 12,194,145 Bonds, Series 2001, 5.000%, 10/01/30 5,000 Orange County Health Facilities Authority (Florida), Hospital Revenue 10/09 at 101 A 5,235,250 Bonds (Orlando Regional Healthcare System), Series 1999E, 6.000%, 10/01/26 5,570 Orlando Utilities Commission (Florida), Water and Electric 10/02 at 100 Aa2 5,601,359 Subordinated Revenue Bonds, Series 1992A, 5.500%, 10/01/27 8,000 Orlando Utilities Commission (Florida), Water and Electric 10/03 at 102 Aa2 8,091,280 Subordinated Revenue Refunding Bonds, Series 1993A, 5.250%, 10/01/23 Orlando Utilities Commission (Florida), Water and Electric Subordinated Revenue Bonds, Series 1993B: 14,000 5.600%, 10/06/17 10/03 at 102 14,521,640 9,600 5.250%, 10/01/23 10/03 at 101 Aa2 9,665,280 2,500 Orlando Utilities Commission (Florida), Water and Electric Revenue 10/02 at 101 Aa1 2,509,850 Bonds, Series 1993, 5.125%, 10/01/19 Nuveen Municipal Value Fund, Inc. (NUV) (continued) Portfolio of Investments October 31, 2001 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ GEORGIA - 2.3% $ 20,350 City of Atlanta (Georgia), Water and Wastewater Revenue Bonds, 5/09 at 101 AAA $ 20,096,439 Series 1999A, 5.000%, 11/01/38 Coffee County Hospital Authority (Georgia), Revenue Anticipation Certificates (Coffee Regional Medical Center, Inc. Project), Series 1997A: 2,500 6.250%, 12/01/06 No Opt. Call N/R 2,568,550 21,100 6.750%, 12/01/26 12/06 at 102 N/R 21,022,563 2,250 Hospital Authority of the City of Royston (Georgia), Revenue 7/09 at 102 N/R 2,152,553 Anticipation Certificates (Ty Cobb Healthcare System, Inc. Project), Series 1999, 6.500%, 7/01/27 - ------------------------------------------------------------------------------------------------------------------------------------ ILLINOIS - 11.8% 2,060 Aurora, Illinois, Golf Course Revenue Bonds, Series 2000, 1/10 at 100 A+ 2,244,246 6.375%, 1/01/20 5,000 City of Chicago, Illinois, General Obligation Bonds, Series A 1/02 at 102 AAA 5,132,200 of 1992, 6.250%, 1/01/12 (Pre-refunded to 1/01/02) 2,000 Chicago School Reform Board of Trustees of the Board of Education 12/07 at 102 AAA 2,036,160 of the City of Chicago, Illinois, Unlimited Tax General Obligation Bonds (Dedicated Tax Revenues), Series 1997A, 5.250%, 12/01/22 Chicago School Reform Board of Trustees of the Board of Education of the City of Chicago, Illinois, Unlimited Tax General Obligation Bonds (Dedicated Tax Revenues), Series 1998A: 15,000 0.000%, 12/01/24 No Opt. Call AAA 4,392,450 47,500 0.000%, 12/01/28 No Opt. Call AAA 11,127,825 1,125 Metropolitan Water Reclamation District of Greater Chicago, No Opt. Call AA+ 1,379,363 Illinois, General Obligation Capital Improvement Bonds, Series 1991, 7.000%, 1/01/11 3,575 City of Chicago, Illinois, O'Hare International Airport Second Lien 1/11 at 101 AAA 3,513,796 Passenger Facility Charge Revenue Bonds, Series 2001C, 5.100%, 1/01/26 (Alternative Minimum Tax) 4,930 Illinois Development Finance Authority, Industrial Development 6/02 at 102 N/R 5,009,176 Revenue Bonds, Series 1992 (Plano Molding Company Project), 7.750%, 6/01/12 (Alternative Minimum Tax) 3,000 Illinois Development Finance Authority, Pollution Control Revenue No Opt. Call A- 3,054,750 Refunding Bonds, Series 1994 (Commonwealth Edison Company Project), 5.850%, 1/15/14 Illinois Development Finance Authority (The Presbyterian Home Lake Forest Place Project), Revenue Bonds, Series 1996 B: 6,495 6.400%, 9/01/31 (Pre-refunded to 9/01/06) 9/06 at 102 AAA 7,553,880 990 6.400%, 9/01/31 9/06 at 102 AAA 1,066,190 1,800 Illinois Development Finance Authority, Local Government Program No Opt. Call Aaa 747,504 Revenue Bonds, Series 2000 (Rockford School District Number 205 Project), 0.000%, 2/01/19 8,000 Illinois Development Finance Authority, Revenue Bonds 9/11 at 100 AAA 7,835,760 (Illinois Wesleyan University), Series 2001, 5.125%, 9/01/35 14,000 Illinois Health Facilities Authority, Revenue Refunding Bonds, 10/03 at 102 A- 15,016,400 Series 1993 (Illinois Masonic Medical Center), 5.500%, 10/01/19 7,000 Illinois Health Facilities Authority, Revenue Bonds, Series 1993 11/03 at 102 AAA 7,045,220 (Swedish American Hospital), 5.375%, 11/15/23 18,015 Illinois Health Facilities Authority, Revenue Bonds, Series 1993 11/03 at 102 AAA 18,102,373 (Rush-Presbyterian-St. Luke's Medical Center Obligated Group), 5.250%, 11/15/20 Illinois Health Facilities Authority, Revenue Bonds, Series 1992 (South Suburban Hospital): 1,150 7.000%, 2/15/18 (Pre-refunded to 2/15/02) 2/02 at 102 A*** 1,188,962 4,350 7.000%, 2/15/18 No Opt. Call A*** 5,350,935 8,000 Illinois Health Facilities Authority, Revenue Bonds, Series 1997 8/07 at 101 AAA 7,944,320 (Sherman Health Systems), 5.250%, 8/01/22 15,000 Illinois Health Facilities Authority, Revenue Bonds, Series 2000 5/10 at 101 A3 15,687,900 (Condell Medical Center), 6.500%, 5/15/30 15,000 Illinois Health Facilities Authority, Revenue Bonds, Series 2001B 2/11 at 101 AAA 15,039,000 (Edward Hospital Obligation Group), 5.250%, 2/15/34 48,805 State of Illinois, Sales Tax Revenue Refunding Bonds, Series Q, 6/02 at 101 AAA 49,913,850 5.500%, 6/15/20 Metropolitan Pier and Exposition Authority, Illinois, McCormick Place Expansion Project Bonds, Series 1992A: 18,955 0.000%, 6/15/17 No Opt. Call AAA 8,683,475 12,300 0.000%, 6/15/18 No Opt. Call AAA 5,290,968 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ ILLINOIS (continued) Metropolitan Pier and Exposition Authority, Illinois, McCormick Place Expansion Project Bonds, Series 1994B: $ 7,250 0.000%, 6/15/18 No Opt. Call AAA $ 3,118,660 9,900 0.000%, 6/15/29 No Opt. Call AAA 2,259,972 16,550 Metropolitan Pier and Exposition Authority, Illinois, McCormick Place No Opt. Call AAA 5,765,193 Expansion Project Refunding Bonds, Series 1996A, 0.000%, 12/15/21 11,650 Regional Transportation Authority, Cook, DuPage, Kane, Lake, 6/04 at 102 AAA 12,937,442 McHenry and Will Counties, Illinois, General Obligation Bonds, Series 1994A, 6.250%, 6/01/24 1,505 Tri-City Regional Port District, Illinois, Port and Terminal Facilities No Opt. Call N/R 1,569,670 Revenue Bonds (1998 Refunding and Dock #2 Enhancement Project), Series 1998B, 5.875%, 7/01/08 (Alternative Minimum Tax) 2,295 School District Number 161, Will County, Illinois, Capital No Opt. Call Aaa 1,008,721 Appreciation School Bonds, Series 1999, 0.000%, 1/01/18 - ------------------------------------------------------------------------------------------------------------------------------------ INDIANA - 3.6% Indiana Bond Bank, State Revolving Fund Program Revenue Bonds, Series 2001A: 9,815 5.375%, 2/01/18 (WI, settling 11/14/01) 2/13 at 101 AAA 10,318,411 10,000 5.375%, 2/01/19 (WI, settling 11/14/01) 2/13 at 101 AAA 10,418,800 10,000 Indiana Health Facility Financing Authority, Hospital Revenue 11/07 at 102 AAA 10,131,000 Bonds, Series 1997A (Sisters of St. Francis Health Services, Inc. Project), 5.375%, 11/01/27 17,105 Indiana Health Facility Financing Authority, Hospital Revenue 2/07 at 102 AA 17,898,501 Bonds, Series 1996A (Clarian Health Partners, Inc.), 6.000%, 2/15/21 4,840 Indianapolis Airport Authority, Indiana, Special Facilities Revenue 7/04 at 102 BBB 5,102,715 Bonds, Series 1994 (Federal Express Corporation Project), 7.100%, 1/15/17 (Alternative Minimum Tax) Indianapolis, Indiana, Local Public Improvement Bond Bank, Series 1999E: 12,500 0.000%, 2/01/21 No Opt. Call AAA 4,541,000 10,000 0.000%, 2/01/27 No Opt. Call AAA 2,610,700 9,155 South Bend, Indiana, Multifamily Refunding Revenue Bonds 11/01 at 102 N/R 8,790,906 (Pointe at St. Joseph Project), Series A, 6.200%, 12/15/18 500 South Bend, Indiana, Multifamily Refunding Revenue Bonds 11/01 at 102 N/R 490,320 (Pointe at St. Joseph Project), Series B, 6.450%, 12/15/18 (Alternative Minimum Tax) 3,169 South Bend, Indiana, Multifamily Refunding Revenue Bonds 12/03 at 100 N/R 2,045,344 (Pointe at St. Joseph Project), Series C, 3.850%, 12/15/18 - ------------------------------------------------------------------------------------------------------------------------------------ IOWA - 1.6% 12,930 Iowa Housing Finance Authority, Single Family Housing Bonds, No Opt. Call AAA 2,543,460 1984 Issue A, 0.000%, 9/01/16 30,000 Tobacco Settlement Authority, Iowa, Tobacco Settlement 6/11 at 101 A1 29,154,300 Asset-Backed Revenue Bonds, Series 2001B, 5.600%, 6/01/35 - ------------------------------------------------------------------------------------------------------------------------------------ KANSAS - 0.4% 6,650 City of Newton, Kansas, Hospital Revenue Bonds (Newton 11/04 at 102 N/R*** 7,717,259 Healthcare Corporation), Series 1994A, 7.750%, 11/15/24 (Pre-refunded to 11/15/04) - ------------------------------------------------------------------------------------------------------------------------------------ KENTUCKY - 1.1% 12,500 County of Carroll, Kentucky, Collateralized Pollution Control Revenue 9/02 at 102 A1 13,214,250 Bonds (Kentucky Utilities Company Project), 1992 Series A, 7.450%, 9/15/16 8,135 Greater Kentucky Housing Assistance Corporation, Mortgage 1/03 at 100 AAA 8,207,157 Revenue Refunding Bonds, Series 1997A (FHA-Insured Mortgage Loans - Section 8 Assisted Projects), 6.100%, 1/01/24 - ------------------------------------------------------------------------------------------------------------------------------------ LOUISIANA - 1.1% 18,445 Louisiana Public Facilities Authority, Hospital Revenue Refunding 11/01 at 100 AAA 22,404,773 Bonds (Southern Baptist Hospitals, Inc. Project), Series 1986, 8.000%, 5/15/12 - ------------------------------------------------------------------------------------------------------------------------------------ MAINE - 1.6% 14,365 Maine State Housing Authority, Mortgage Purchase Bonds, 2/04 at 102 AA 14,832,724 1994 Series A, 5.550%, 11/15/14 15,925 Maine State Housing Authority, Mortgage Purchase Bonds, 5/05 at 102 AA+ 16,695,929 1995 Series A-2, 6.650%, 11/15/25 (Alternative Minimum Tax) Nuveen Municipal Value Fund, Inc. (NUV) (continued) Portfolio of Investments October 31, 2001 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ MARYLAND - 0.7% $ 10,900 Community Development Administration of Maryland, Residential 3/07 at 101 1/2 Aa2 $ 11,349,734 Revenue Bonds (Department of Housing and Community Development), Series 1997B, 5.875%, 9/01/25 (Alternative Minimum Tax) 2,500 Maryland Energy Financing Administration, Limited Obligation 9/05 at 102 N/R 2,634,975 Congeneration Revenue Bonds (AES Warrior Run Project), Series 1995, 7.400%, 9/01/19 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ MASSACHUSETTS - 4.0% Massachusetts Municipal Wholesale Electric Company, Power Supply System Revenue Bonds, 1987 Series A: 100 8.750%, 7/01/18 7/03 at 100 BBB+ 110,467 75 8.750%, 7/01/18 1/02 at 100 BBB+ 75,918 75 8.750%, 7/01/18 7/02 at 100 BBB+ 78,342 105 8.750%, 7/01/18 1/05 at 100 BBB+ 123,226 110 8.750%, 7/01/18 1/03 at 100 BBB+ 118,147 110 8.750%, 7/01/18 7/05 at 100 BBB+ 131,833 215 8.750%, 7/01/18 1/04 at 100 BBB+ 242,301 220 8.750%, 7/01/18 7/04 at 100 BBB+ 254,091 4,900 Massachusetts Industrial Finance Agency, Resource Recovery 1/02 at 103 N/R 5,058,417 Revenue Bonds (SEMASS Project), Series 1991A, 9.000%, 7/01/15 16,400 Massachusetts Turnpike Authority, Metropolitan Highway System 1/07 at 102 AAA 16,066,260 Revenue Bonds (Senior), 1997 Series A 5.000%, 1/01/37 8,000 Massachusetts Turnpike Authority, Metropolitan Highway System 1/07 at 102 AAA 8,004,640 Revenue Bonds (Subordinated), 1997 Series B, 5.125%, 1/01/37 5,000 Massachusetts Turnpike Authority, Metropolitan Highway System 1/09 at 101 AAA 4,888,150 Revenue Bonds (Subordinated), 1999 Series A, 5.000%, 1/01/39 36,580 Massachusetts Water Resources Authority, General Revenue 11/02 at 102 AA 38,159,524 Refunding Bonds, 1992 Series B, 5.500%, 11/01/15 6,000 Massachusetts Water Pollution Abatement Trust, Pool Program 8/10 at 101 AAA 6,292,500 Bonds, Series 6, 5.500%, 8/01/30 - ------------------------------------------------------------------------------------------------------------------------------------ MICHIGAN - 5.8% 6,000 The Economic Development Corporation of the City of Dearborn, 8/04 at 102 AAA 6,046,200 Michigan, Hospital Revenue Refunding Bonds (Oakwood Obligated Group), Series 1994A, 5.250%, 8/15/21 10,000 City of Detroit Local Development Finance Authority, Michigan, 5/09 at 101 BB- 8,699,500 Tax Increment Bonds, Series 1998A, 5.500%, 5/01/21 1,400 City of Detroit, Michigan, Sewage Disposal System Revenue 7/05 at 101 AAA 1,446,690 Refunding Bonds, Series 1995-B, 5.250%, 7/01/15 County of Grand Traverse Hospital Finance Authority, Michigan, Hospital Revenue Refunding Bonds (Munson Healthcare Obligated Group), Series 1992A: 2,700 6.250%, 7/01/12 (Pre-refunded to 7/01/02) 7/02 at 102 AAA 2,828,169 1,300 6.250%, 7/01/12 7/02 at 102 AAA 1,359,072 3,000 Michigan Municipal Bond Authority, Public School Academy Bonds 10/09 at 102 Ba1 3,191,580 (Detroit Academy of Arts and Sciences), Series 2001, 7.900%, 10/01/21 12,925 Michigan State Hospital Finance Authority, Revenue and Refunding 8/03 at 102 BBB- 13,043,910 Bonds (The Detroit Medical Center Obligated Group), Series 1993A, 6.500%, 8/15/18 35,305 Michigan State Hospital Finance Authority, Hospital Revenue Bonds 8/08 at 101 BBB- 30,251,089 (The Detroit Medical Center Obligated Group), Series 1998A, 5.250%, 8/15/28 4,320 Michigan State Housing Development Authority, Rental Housing 4/03 at 102 AAA 4,431,715 Revenue Bonds, 1993 Series A, 5.875%, 10/01/17 15,750 Michigan State Housing Development Authority, Rental Housing 6/05 at 102 AAA 16,658,145 Revenue Bonds, 1995 Series B, 6.150%, 10/01/15 25,000 Michigan Strategic Fund, Limited Obligation Refunding Revenue 9/05 at 102 AAA 27,775,250 Bonds (Detroit Edison Company Pollution Control Bonds Project), Collateralized Series 1995AA, 6.400%, 9/01/25 - ------------------------------------------------------------------------------------------------------------------------------------ MINNESOTA - 0.2% 3,620 Minnesota Housing Finance Agency, Rental Housing Bonds, 2/05 at 102 AAA 3,767,117 1995 Series D, 5.900%, 8/01/15 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ MISSISSIPPI - 0.7% $ 13,000 Mississippi Hospital Equipment and Facilities Authority, Revenue 5/03 at 102 AAA $ 13,445,120 Refunding and Improvement Bonds (North Mississippi Health Services), 1993 Series 1, 5.750%, 5/15/16 - ------------------------------------------------------------------------------------------------------------------------------------ MISSOURI - 0.3% The Industrial Development Authority of the City of West Plains, Missouri, Hospital Facilities Revenue Bonds (Ozark Medical Center), Series 1997: 1,750 5.500%, 11/15/12 11/07 at 101 BB+ 1,665,143 1,000 5.600%, 11/15/17 11/07 at 101 BB+ 913,000 3,075 The Industrial Development Authority of the City of West Plains, 11/09 at 101 BB+ 3,071,310 Missouri, Hospital Facilities Revenue Bonds (Ozark Medical Center), Series 1999, 6.750%, 11/15/24 - ------------------------------------------------------------------------------------------------------------------------------------ NEBRASKA - 0.1% 2,450 Consumers Public Power District, Nebraska, Nuclear Facility 1/02 at 100 A+ 2,455,439 Revenue Bonds, 1968 Series, 5.100%, 1/01/03 - ------------------------------------------------------------------------------------------------------------------------------------ NEVADA - 1.1% Director of the State of Nevada, Department of Business and Industry, Revenue Bonds (Las Vegas Monorail Project), 1st Tier Series 2000: 7,500 0.000%, 1/01/24 No Opt. Call AAA 2,324,475 18,800 5.375%, 1/01/40 1/10 at 100 AAA 19,184,460 - ------------------------------------------------------------------------------------------------------------------------------------ NEW HAMPSHIRE - 1.1% 20,785 Business Finance Authority of the State of New Hampshire, 10/03 at 102 A3 20,902,643 Pollution Control Refunding Revenue Bonds (The United Illuminating Company Project), 1993 Series A, 5.875%, 10/01/33 - ------------------------------------------------------------------------------------------------------------------------------------ NEW JERSEY - 1.7% 25,625 New Jersey Economic Development Authority, Special Facilities 9/09 at 101 BB- 18,931,750 Revenue Bonds (Continental Airlines, Inc. Project), Series 1999, 6.250%, 9/15/29 (Alternative Minimum Tax) 12,250 New Jersey Economic Development Authority, Special Facilities 11/10 at 101 BB- 10,257,660 Revenue Bonds (Continental Airlines, Inc. Project), Series 2000, 7.000%, 11/15/30 (Alternative Minimum Tax) 5,000 New Jersey Health Care Facilities Financing Authority, Revenue 7/10 at 101 BBB- 5,403,750 Bonds (Trinitas Hospital Obligated Group Issue), Series 2000, 7.500%, 7/01/30 - ------------------------------------------------------------------------------------------------------------------------------------ NEW YORK - 9.6% 5,360 Village of East Rochester Housing Authority, New York, FHA-Insured 8/07 at 102 AAA 5,693,124 Mortgage Revenue Bonds (St. John's Meadows Project), Series 1997A, 5.600%, 8/01/17 Long Island Power Authority, New York, Electric System General Revenue Bonds, Series 1998A: 11,000 5.250%, 12/01/26 6/08 at 101 AAA 11,185,680 32,140 5.500%, 12/01/29 6/03 at 101 A- 32,621,136 15,500 Long Island Power Authority, New York, Electric System General 9/11 at 100 A- 15,783,185 Revenue Bonds, Series 2001A, 5.375%, 9/01/25 5,000 The City of New York, New York, General Obligation Bonds, 8/03 at 101 1/2 A 5,202,800 Fiscal 1994 Series D, 5.750%, 8/15/10 5,000 The City of New York, New York, General Obligation Bonds, 2/06 at 101 1/2 A 5,388,450 Fiscal 1996 Series G, 5.750%, 2/01/14 10,000 The City of New York, New York, General Obligation Bonds, 8/06 at 101 1/2 A 10,718,000 Fiscal 1997 Series E, 6.000%, 8/01/16 13,395 The City of New York, New York, General Obligation Bonds, 8/07 at 101 A 14,391,588 Fiscal 1998 Series D, 5.500%, 8/01/10 39,610 The City of New York, New York, General Obligation Bonds, 10/07 at 101 A 42,122,462 Fiscal 1997 Series G, 6.000%, 10/15/26 15,000 New York City Municipal Water Finance Authority, New York, 6/06 at 101 AAA 16,471,650 Water and Sewer System Revenue Bonds, Fiscal 1996 Series B, 5.750%, 6/15/26 5,200 Dormitory Authority of the State of New York, Court Facilities Lease 5/10 at 101 A 5,615,896 Revenue Bonds (The City of New York Issue), Series 1999, 6.000%, 5/15/39 7,000 Dormitory Authority of the State of New York, Mental Health 8/09 at 101 AA- 7,002,100 Services Facilities Improvement Revenue Bonds, Series 1999D, 5.250%, 2/15/29 9,185 New York State Medical Care Facilities Finance Agency, 8/03 at 102 AAA 9,871,671 St. Luke's-Roosevelt Hospital Center FHA-Insured Mortgage Revenue Bonds, 1993 Series A, 5.600%, 8/15/13 7,500 Power Authority of the State of New York, Series 2000A, 11/10 at 100 Aa2 7,578,900 Revenue Bonds, 5.250%, 11/15/40 Nuveen Municipal Value Fund, Inc. (NUV) (continued) Portfolio of Investments October 31, 2001 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ NORTH CAROLINA - 3.4% $ 2,600 City of Charlotte, North Carolina, Refunding Certificates of 12/03 at 102 AAA $ 2,638,480 Participation (Convention Facility Project), Series 1993C, 5.250%, 12/01/20 12,715 North Carolina Eastern Municipal Power Agency, Power System 9/03 at 102 1/2 BBB 13,045,717 Revenue Bonds, Series 1985-G, 5.750%, 12/01/16 11,610 North Carolina Eastern Municipal Power Agency, Power System 1/03 at 102 BBB 12,066,505 Revenue Bonds, Series 1993-D, 5.875%, 1/01/14 1,000 North Carolina Eastern Municipal Power Agency, Power System 1/07 at 102 AAA 1,085,330 Revenue Bonds, Refunding Series 1996-A, 5.700%, 1/01/13 14,060 North Carolina Municipal Power Agency Number 1, Catawba 1/03 at 100 BBB+ 14,146,891 Electric Revenue Bonds, Series 1992, 5.750%, 1/01/15 13,140 North Carolina Municipal Power Agency Number 1, Catawba 1/02 at 100 BBB+ 13,143,811 Electric Revenue Bonds, Series 1985B, 6.000%, 1/01/20 10,000 North Carolina Municipal Power Agency Number 1, Catawba 1/10 at 101 BBB+ 10,761,900 Electric Revenue Bonds, Series 1999B, 6.500%, 1/01/20 - ------------------------------------------------------------------------------------------------------------------------------------ OKLAHOMA - 0.1% 2,350 Midwest City Memorial Hospital Authority (Oklahoma), Hospital 4/02 at 102 BBB+*** 2,446,914 Revenue Bonds, Series 1992, 7.375%, 4/01/22 (Pre-refunded to 4/01/02) - ------------------------------------------------------------------------------------------------------------------------------------ PENNSYLVANIA - 3.6% 5,955 Pennsylvania Convention Center Authority, Refunding Revenue 9/04 at 102 BBB 6,303,368 Bonds, 1994 Series A, 6.750%, 9/01/19 11,175 Pennsylvania Housing Finance Agency, Single Family Mortgage 10/03 at 102 AA+ 11,526,342 Revenue Bonds, Series 1993-36, 5.450%, 10/01/14 9,000 Pennsylvania Housing Finance Agency, Single Family Mortgage 4/06 at 102 AA+ 9,430,290 Revenue Bonds, Series 1996-51, 6.375%, 4/01/28 (Alternative Minimum Tax) 18,850 Pennsylvania Intergovernmental Cooperation Authority, Special Tax 6/03 at 100 AAA 18,741,047 Revenue Refunding Bonds (City of Philadelphia Funding Program), Series of 1993A, 5.000%, 6/15/22 4,500 Pennsylvania Higher Educational Facilities Authority, The Trustees 7/08 at 100 AA 4,158,630 of the University of Pennsylvania, Revenue Bonds, Series 1998, 4.500%, 7/15/21 19,255 City of Philadelphia, Pennsylvania, Water and Wastewater Revenue 6/03 at 102 AAA 20,309,981 Bonds, Series 1993, 5.500%, 6/15/14 - ------------------------------------------------------------------------------------------------------------------------------------ PUERTO RICO - 0.8% 10,000 Puerto Rico Infrastructure Financing Authority, Special Obligation 10/10 at 101 AAA 10,582,400 Bonds, 2000 Series A, 5.500%, 10/01/40 5,500 Puerto Rico Industrial, Tourist, Educational, Medical, and 6/10 at 101 Baa2 6,020,190 Environmental Control Facilities Financing Authority, Cogeneration Facility Revenue Bonds, 2000 Series A, 6.625%, 6/01/26 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ RHODE ISLAND - 0.3% 6,250 Rhode Island Health and Educational Building Corporation, Hospital 5/07 at 102 AAA 6,290,438 Financing Revenue Bonds, Lifespan Obligated Group Issue, Series 1996, 5.250%, 5/15/26 - ------------------------------------------------------------------------------------------------------------------------------------ SOUTH CAROLINA - 1.0% 13,000 Piedmont Municipal Power Agency, South Carolina, Electric 1/02 at 100 BBB- 11,456,900 Revenue Bonds, 1986 Refunding Series, 5.000%, 1/01/25 8,000 South Carolina Jobs-Economic Development Authority, Hospital 12/10 at 102 BBB 8,761,840 Improvement Revenue Bonds (Palmetto Health Alliance), Series 2000A, 7.375%, 12/15/21 - ------------------------------------------------------------------------------------------------------------------------------------ TENNESSEE - 0.1% 2,125 Municipal Energy Acquisition Corporation (Tennessee), Gas No Opt. Call AAA 2,112,038 Revenue Bonds, Series 1999, 4.125%, 3/01/08 - ------------------------------------------------------------------------------------------------------------------------------------ TEXAS - 4.9% 13,040 Alliance Airport Authority, Inc., Texas, Special Facilities Revenue 12/01 at 101 BB 12,711,392 Bonds, Series 1990 (American Airlines, Inc. Project), 7.500%, 12/01/29 (Alternative Minimum Tax) PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ TEXAS (continued) $ 24,265 City of Austin, Texas, Combined Utility Systems Revenue Refunding No Opt. Call AAA $ 35,728,999 Bonds, Series 1992A, 12.500%, 11/15/07 2,110 Corpus Christi Housing Finance Corporation, Texas, Single Family 1/02 at 103 AAA 2,179,947 Mortgage Senior Revenue Refunding Bonds, Series 1991A, 7.700%, 7/01/11 10,045 City of Houston, Texas, Airport System Subordinate Lien Revenue 7/10 at 100 AAA 10,696,217 Bonds, Series 2000A, 5.875%, 7/01/16 (Alternative Minimum Tax) Irving Independent School District, Texas, Unlimited Tax School Building Bonds, Series 1997: 5,685 0.000%, 2/15/10 No Opt. Call AAA 4,011,791 3,470 0.000%, 2/15/11 No Opt. Call AAA 2,326,635 22,060 Leander Independent School District, Williamson and Travis 8/09 at 31 15/32 AAA 4,750,180 Counties, Texas, Unlimited Tax School Building and Refunding Bonds, Series 2000, 0.000%, 8/15/27 14,625 Matagorda County Navigation District Number One, Texas, 4/02 at 101 AAA 14,804,888 Collateralized Revenue Refunding Bonds (Houston Lighting and Power Company Project), Series 1995, 5.800%, 10/15/15 5,000 Industrial Development Corporation of Port of Corpus Christi, 4/08 at 102 BBB- 4,999,200 Texas, Revenue Refunding Bonds (Valero Refining and Marketing Company Project), 5.400%, 4/01/18 5,750 Weslaco Health Facilities Development Corporation, Texas, 1/04 at 102 AAA 5,791,458 Hospital Revenue Bonds (Knapp Medical Center Project), Series 1994, 5.375%, 6/01/23 - ------------------------------------------------------------------------------------------------------------------------------------ UTAH - 3.4% 12,000 Intermountain Power Agency (Utah), Power Supply Revenue 7/06 at 102 A+ 11,873,280 Refunding Bonds, 1996 Series D, 5.000%, 7/01/21 5,000 Intermountain Power Agency (Utah), Power Supply Revenue 7/07 at 102 AAA 5,341,500 Refunding Bonds, 1997 Series B, 5.750%, 7/01/19 Intermountain Power Agency (Utah), Power Supply Revenue Refunding Bonds, 1993 Series A: 16,080 5.500%, 7/01/20 7/03 at 102 A+*** 16,428,614 21,045 5.500%, 7/01/20 7/03 at 102 A+ 21,353,309 8,280 5.000%, 7/01/23 7/03 at 100 A+ 8,166,233 4,905 Utah Housing Finance Agency, Single Family Mortgage Bonds, 1/10 at 101 1/2 AAA 4,841,284 1998 Series G, 5.200%, 7/01/30 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ VIRGINIA - 0.2% 3,245 Virginia Housing Development Authority, Multifamily Housing 1/08 at 102 AA+ 3,370,030 Bonds, Series 1997E, 5.600%, 11/01/17 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ WASHINGTON - 9.7% 9,450 Washington Public Power Supply System, Nuclear Project No. 1 7/03 at 102 AAA 9,787,176 Refunding Revenue Bonds, Series 1993A, 5.700%, 7/01/17 Washington Public Power Supply System, Nuclear Project No. 1 Refunding Revenue Bonds, Series 1993C: 27,000 5.400%, 7/01/12 7/03 at 102 Aa1 27,848,610 2,970 5.375%, 7/01/15 7/03 at 102 Aa1 3,037,092 Washington Public Power Supply System, Nuclear Project No. 2 Refunding Revenue Bonds, Series 1993A: 8,495 5.750%, 7/01/12 (Pre-refunded to 7/01/03) 7/03 at 102 Aa1*** 9,144,273 2,895 5.750%, 7/01/12 7/03 at 102 Aa1 3,016,764 17,700 Washington Public Power Supply System, Nuclear Project No. 2 7/04 at 102 Aa1 18,569,778 Refunding Revenue Bonds, Series 1994A, 5.375%, 7/01/10 Washington Public Power Supply System, Nuclear Project No. 3 Refunding Revenue Bonds, Series 1993C: 81,000 5.400%, 7/01/12 7/03 at 102 Aa1 83,545,830 15,850 5.375%, 7/01/15 7/03 at 102 Aa1 16,429,793 Washington Public Power Supply System, Nuclear Project No. 3 Refunding Revenue Bonds, Series 1993B: 5,615 5.625%, 7/01/12 (Pre-refunded to 7/01/03) 7/03 at 102 Aa1*** 6,032,756 5,895 5.625%, 7/01/12 7/03 at 102 Aa1 6,130,211 9,000 5.600%, 7/01/17 7/03 at 102 AAA 9,268,380 - ------------------------------------------------------------------------------------------------------------------------------------ WEST VIRGINIA - 0.4% 7,180 West Virginia Housing Development Fund, Housing Finance Bonds, 11/06 at 102 AAA 7,523,994 Series 1997-A, 6.050%, 5/01/27 Nuveen Municipal Value Fund, Inc. (NUV) (continued) Portfolio of Investments October 31, 2001 Principal Optional Call Market Amount (000) Description Provisions* Ratings** Value - ------------------------------------------------------------------------------------------------------------------------------------ WISCONSIN - 2.0% $ 20,385 The Wisconsin Public Power Incorporated System, Power Supply 7/03 at 102 AAA $ 20,542,168 System Revenue Bonds, Series 1993 A, 5.250%, 7/01/21 5 Wisconsin Housing and Economic Development Authority, 3/04 at 102 AA 5,179 Homeownership Revenue Bonds, 1994 Series B, 6.750%, 9/01/25 (Alternative Minimum Tax) 17,020 Wisconsin Health and Educational Facilities Authority, Revenue 8/03 at 102 AAA 17,306,104 Bonds (Sisters of the Sorrowful Mother - Ministry Corporation), Series 1993D, 5.500%, 8/15/19 1,750 Wisconsin Health and Educational Facilities Authority, Revenue 8/03 at 102 AAA 1,807,920 Bonds (Sisters of the Sorrowful Mother - Ministry Corporation), Series 1993C, 5.400%, 8/15/13 - ------------------------------------------------------------------------------------------------------------------------------------ $ 2,114,799 Total Investments (cost $1,856,923,512) - 100.7% 1,996,479,514 =============----------------------------------------------------------------------------------------------------------------------- Other Assets Less Liabilities - (0.7)% (14,340,043) -------------------------------------------------------------------------------------------------------------------- Net Assets - 100% $1,982,139,471 ==================================================================================================================== * Optional Call Provisions (not covered by the report of independent auditors): Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. ** Ratings (not covered by the report of independent auditors): Using the higher of Standard & Poor's or Moody's rating. *** Securities are backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities which ensures the timely payment of principal and interest. Securities are normally considered to be equivalent to AAA rated securities. N/R Investment is not rated. (WI) Security purchased on a when-issued basis. See accompanying notes to financial statements.
Nuveen Municipal Income Fund, Inc. (NMI) Portfolio of Investments October 31, 2001
PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ CALIFORNIA - 6.3% $ 5,530 Adelanto School District, San Bernardino County, California, No Opt. Call AAA $ 1,872,900 1997 Series A, General Obligation Bonds, 0.000%, 9/01/22 Brea Olinda Unified School District, California, General Obligation Bonds, Election of 1999, Series 1999A: 2,000 0.000%, 8/01/21 No Opt. Call AAA 723,520 2,070 0.000%, 8/01/22 No Opt. Call AAA 705,539 2,120 0.000%, 8/01/23 No Opt. Call AAA 683,149 3,000 California Pollution Control Financing Authority, Solid Waste Disposal 7/07 at 102 N/R 238,800 Revenue Bonds (CanFibre of Riverside Project), Series 1997A, 9.000%, 7/01/19 (Alternative Minimum Tax)# 1,150 Foothill/Eastern Transportation Corridor Agency, California, 1/07 at 100 AAA 1,323,133 Toll Road Revenue Bonds, Series 1995A, 6.000%, 1/01/34 (Pre-refunded to 1/01/07) - ------------------------------------------------------------------------------------------------------------------------------------ COLORADO - 6.6% 2,755 City and County of Denver, Colorado, Airport System Revenue 11/11 at 100 AAA 2,852,720 Refunding Bonds, Series 2001D, 5.500%, 11/15/18 (Alternative Minimum Tax) City and County of Denver, Colorado, Airport System Revenue Bonds, Series 1992B: 410 7.250%, 11/15/23 (Alternative Minimum Tax) (Pre-refunded to 11/15/02) 11/02 at 102 Aaa 439,278 1,590 7.250%, 11/15/23 (Alternative Minimum Tax) 11/02 at 102 A 1,687,117 780 City and County of Denver, Colorado, Airport System Revenue Bonds, 11/01 at 102 A*** 797,519 Series 1991A, 8.750%, 11/15/23 (Alternative Minimum Tax) (Pre-refunded to 11/15/01) - ------------------------------------------------------------------------------------------------------------------------------------ CONNECTICUT - 6.6% 1,480 Capitol Region Education Council, Connecticut, Revenue Bonds, 10/05 at 102 BBB 1,592,894 6.750%, 10/15/15 3,000 State of Connecticut Health and Educational Facilities Authority, 7/06 at 102 BBB- 3,108,510 Revenue Bonds, University of New Haven Issue, Series D, 6.700%, 7/01/26 995 Housing Authority of the City of Willimantic, Connecticut, 10/05 at 105 AAA 1,104,818 Multifamily Housing Revenue Bonds, Series 1995A (GNMA Collateralized Mortgage Loan - Village Heights Apartments Project), 8.000%, 10/20/30 - ------------------------------------------------------------------------------------------------------------------------------------ FLORIDA - 5.0% 1,670 Dade County Industrial Development Authority, Florida, Industrial 6/05 at 102 N/R 1,732,959 Development Revenue Bonds, Series 1995 (Miami Cerebral Palsy Residential Services, Inc. Project), 8.000%, 6/01/22 2,000 Martin County Industrial Development Authority, Florida, Industrial 12/04 at 102 BBB- 2,064,140 Development Revenue Bonds (Indiantown Cogeneration, L.P. Project), Series 1994A, 7.875%, 12/15/25 (Alternative Minimum Tax) 600 Martin County Industrial Development Authority, Florida, Industrial 12/04 at 102 BBB- 632,436 Development Refunding Revenue Bonds (Indiantown Cogeneration Project), Series B, 8.050%, 12/15/25 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ ILLINOIS - 11.6% 4,275 City of Chicago, Illinois, Tax Increment Allocation Bonds 1/09 at 100 N/R 4,272,692 (Irving/Cicero Redevelopment Project), Series 1998, 7.000%, 1/01/14 1,300 Illinois Health Facilities Authority, McHenry, Revenue Bonds, 9/03 at 102 A-*** 1,411,618 Series 1993 (Northern Illinois Medical Center Project), 6.000%, 9/01/19 (Pre-refunded to 9/01/03) 2,000 Illinois Health Facilities Authority, Revenue Refunding Bonds, 10/03 at 102 A- 2,145,200 Series 1993 (Illinois Masonic Medical Center), 5.500%, 10/01/19 620 Illinois Housing Development Authority, Homeowner Mortgage 8/04 at 102 AA 625,723 Revenue Bonds, 1994 Series A-2, 6.700%, 8/01/25 (Alternative Minimum Tax) 1,945 Joliet Regional Port District Airport Facilities, Illinois, Revenue 7/07 at 103 N/R 1,825,246 Bonds (Lewis University Airport), Series 1997A, 7.250%, 7/01/18 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ INDIANA - 7.5% 7,000 Whitley County, Indiana, Solid Waste and Sewage Disposal Revenue 11/10 at 102 N/R 6,569,080 Bonds (Steel Dynamics, Inc. Project), Series 1998, 7.250%, 11/01/18 (Alternative Minimum Tax) Nuveen Municipal Income Fund, Inc. (NMI) (continued) Portfolio of Investments October 31, 2001 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ IOWA - 2.2% $ 2,000 Tobacco Settlement Authority, Iowa, Tobacco Settlement 6/11 at 101 A1 $ 1,948,700 Asset-Backed Revenue Bonds, Series 2001B, 5.300%, 6/01/25 - ------------------------------------------------------------------------------------------------------------------------------------ LOUISIANA - 3.4% Louisiana Public Facilities Authority, Extended Care Facilities Revenue Bonds (Comm-Care Corporation Project), Series 1994: 405 11.000%, 2/01/04 No Opt. Call BBB 432,374 2,000 11.000%, 2/01/14 No Opt. Call BBB 2,556,540 - ------------------------------------------------------------------------------------------------------------------------------------ MARYLAND - 2.4% 2,000 Anne Arundel County, Maryland, Multifamily Housing Revenue No Opt. Call BBB- 2,092,860 Bonds (Twin Coves Apartments Project), Series 1994, 7.450%, 12/01/24 (Alternative Minimum Tax) (Mandatory put 12/01/03) - ------------------------------------------------------------------------------------------------------------------------------------ MASSACHUSETTS - 4.0% 460 Massachusetts Health and Educational Facilities Authority, Revenue 11/01 at 100 AAA 469,752 Bonds, Beverly Hospital Issue, Series D, 7.300%, 7/01/13 3,000 Massachusetts Industrial Finance Agency, Resource Recovery 1/02 at 103 N/R 3,096,990 Revenue Bonds (SEMASS Project), Series 1991A, 9.000%, 7/01/15 - ------------------------------------------------------------------------------------------------------------------------------------ MISSISSIPPI - 5.1% 4,500 Mississippi Business Finance Corporation, Pollution Control 10/03 at 102 BBB- 4,460,130 Refunding Revenue Bonds (System Energy Resources, Inc. Project), Series 1998, 5.875%, 4/01/22 - ------------------------------------------------------------------------------------------------------------------------------------ NEW HAMPSHIRE - 0.8% 700 New Hampshire Higher Educational and Health Facilities 1/07 at 102 BBB- 683,648 Authority, Revenue Bonds, Series 1997 (New Hampshire College), 6.375%, 1/01/27 - ------------------------------------------------------------------------------------------------------------------------------------ NEW YORK - 17.5% 1,475 County of Cattaraugus Industrial Development Agency, New York, No Opt. Call N/R 1,439,703 Industrial Development Revenue Bonds, Series 1999A (Laidlaw Energy and Environmental, Inc. Project), 8.500%, 7/01/21 (Alternative Minimum Tax) 5,000 Erie County Industrial Development Agency, New York, Solid Waste 12/10 at 103 N/R 2,081,250 Disposal Facility Revenue Bonds (1998 CanFibre of Lackawanna Project), 8.875%, 12/01/13 (Alternative Minimum Tax) The City of New York, New York, General Obligation Bonds, Fiscal 1996 Series F: 500 5.750%, 2/01/15 2/06 at 101 1/2 A 528,210 1,400 5.750%, 2/01/19 2/06 at 101 1/2 A 1,462,958 1,000 The City of New York, New York, General Obligation Bonds, 2/06 at 101 1/2 A 1,077,690 Fiscal 1996 Series G, 5.750%, 2/01/14 1,250 The City of New York, New York, General Obligation Bonds, 11/06 at 101 1/2 A 1,357,888 Fiscal 1997 Series D, 5.875%, 11/01/11 2,500 New York State Medical Care Facilities Finance Agency, Brookdale 2/05 at 102 AAA 2,883,425 Hospital Medical Center Secured Hospital Revenue Bonds, 1995 Series A, 6.800%, 8/15/12 (Pre-refunded to 2/15/05) 130 UFA Development Corporation, Utica, New York, FHA-Insured 1/07 at 102 Aa2 131,487 Mortgage Revenue Bonds, Series 1997A (Loretto-Utica Project), 6.125%, 7/01/35 4,190 Yates County Industrial Development Agency, New York, Civic 2/11 at 101 AAA 4,499,264 Facility Revenue Bonds, Series 2000A (Soldiers and Sailors Memorial Hospital - FHA-Insured Mortgage), 6.000%, 2/01/41 - ------------------------------------------------------------------------------------------------------------------------------------ OHIO - 2.9% 2,700 Ohio Water Development Authority, Solid Waste Disposal 9/09 at 102 N/R 2,594,592 Revenue Bonds (Bay Shore Power Project), Convertible Series 1998A, 6.625%, 9/01/20 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ OKLAHOMA - 0.5% 470 Oklahoma County Industrial Authority, Revenue Bonds (Oklahoma 1/02 at 100 N/R 471,669 Blood Institute Project), Series 1988, 9.000%, 7/01/03 - ------------------------------------------------------------------------------------------------------------------------------------ OREGON - 1.2% 1,000 State of Oregon Housing and Community Services Department, 7/07 at 101 1/2 Aa2 1,024,770 Mortgage Revenue Bonds (Single Family Mortgage Program), 1997 Series H, 5.650%, 7/01/28 (Alternative Minimum Tax) PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ PENNSYLVANIA - 5.5% $ 1,800 Allegheny County Hospital Development Authority, Pennsylvania, 11/10 at 102 B+ $ 1,900,620 Health System Revenue Bonds, Series 2000B (West Penn Allegheny Health System), 9.250%, 11/15/30 1,745 Carbon County Industrial Development Authority, Pennsylvania, No Opt. Call BBB- 1,866,365 Resource Recovery Refunding Revenue Bonds, Series 2000 (Panther Creek Partners Project), 6.650%, 5/01/10 (Alternative Minimum Tax) 1,000 Pennsylvania Convention Center Authority, Refunding Revenue 9/04 at 102 BBB 1,058,500 Bonds, 1994 Series A, 6.750%, 9/01/19 - ------------------------------------------------------------------------------------------------------------------------------------ TEXAS - 6.2% 1,055 Alliance Airport Authority, Inc., Texas, Special Facilities Revenue 12/01 at 101 BB 1,028,414 Bonds, Series 1990 (American Airlines, Inc. Project), 7.500%, 12/01/29 (Alternative Minimum Tax) 610 Hidalgo County Housing Finance Corporation, Texas, Single Family 4/04 at 102 Aaa 634,998 Mortgage Revenue Bonds (GNMA and FNMA Collateralized), Series 1994A, 7.000%, 10/01/27 (Alternative Minimum Tax) 3,000 Laredo Independent School District, Webb County, Texas, 8/09 at 100 AAA 3,036,870 Unlimited Tax School Building Bonds, Series 1999, 5.250%, 8/01/24 West Independent School District, McLennan and Hill Counties, Texas, Unlimited Tax School Building and Refunding Bonds, Series 1998: 1,000 0.000%, 8/15/25 8/13 at 51 27/32 AAA 271,280 1,000 0.000%, 8/15/26 8/13 at 49 3/32 AAA 256,180 1,000 8/15/27 8/13 at 46 15/32 AAA 242,310 - ------------------------------------------------------------------------------------------------------------------------------------ UTAH - 1.2% 1,000 Utah Housing Finance Agency, Single Family Mortgage Bonds, 1/10 at 101 1/2 AA 1,023,230 1998 Series A2, 5.350%, 7/01/20 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ WASHINGTON - 1.6% 1,240 Housing Authority of the City of Bellingham, Washington, 11/04 at 100 A1*** 1,395,643 Housing Revenue Bonds, Series 1994 (Cascade Meadows Project), 7.100%, 11/01/23 (Pre-refunded to 11/01/04) - ------------------------------------------------------------------------------------------------------------------------------------ $ 99,420 Total Investments (cost $88,381,104) - 98.1% 86,417,301 =============----------------------------------------------------------------------------------------------------------------------- Other Assets Less Liabilities - 1.9% 1,671,345 ------------------------------------------------------------------------------------------------------------------- Net Assets - 100% $ 88,088,646 =================================================================================================================== * Optional Call Provisions (not covered by the report of independent auditors): Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. ** Ratings (not covered by the report of independent auditors): Using the higher of Standard & Poor's or Moody's rating. *** Securities are backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities which ensures the timely payment of principal and interest. Securities are normally considered to be equivalent to AAA rated securities. # Non-income producing security, in the case of a bond, generally denotes that issuer has defaulted on the payment of principal or interest or has filed for bankruptcy. N/R Investment is not rated. See accompanying notes to financial statements.
Statement of Net Assets October 31, 2001
MUNICIPAL VALUE MUNICIPAL INCOME (NUV) (NMI) - ------------------------------------------------------------------------------------------------------------------------------------ ASSETS Investments in municipal securities, at market value $1,996,479,514 $86,417,301 Cash -- 175,514 Receivables: Interest 34,478,728 2,034,132 Investments sold 85,025 15,088 Other assets 63,056 5,267 - ------------------------------------------------------------------------------------------------------------------------------------ Total assets 2,031,106,323 88,647,302 - ------------------------------------------------------------------------------------------------------------------------------------ LIABILITIES Cash overdraft 17,930,784 -- Payable for investments purchased 20,716,668 -- Accrued expenses: Management fees 911,826 48,569 Other 1,121,794 58,439 Dividends payable 8,285,780 451,648 - ------------------------------------------------------------------------------------------------------------------------------------ Total liabilities 48,966,852 558,656 - ------------------------------------------------------------------------------------------------------------------------------------ Net assets $1,982,139,471 $88,088,646 ==================================================================================================================================== Shares outstanding 194,959,520 8,065,134 ==================================================================================================================================== Net asset value per share outstanding (net assets divided by shares outstanding) $ 10.17 $ 10.92 ==================================================================================================================================== See accompanying notes to financial statements.
Statement of Operations Year Ended October 31, 2001
MUNICIPAL VALUE MUNICIPAL INCOME (NUV) (NMI) - ----------------------------------------------------------------------------------------------------------------------------------- INVESTMENT INCOME $112,017,861 $6,141,458 - ----------------------------------------------------------------------------------------------------------------------------------- EXPENSES Management fees 10,756,637 572,376 Shareholders' servicing agent fees and expenses 688,565 39,566 Custodian's fees and expenses 332,862 34,230 Directors' fees and expenses 21,933 1,686 Professional fees 21,945 14,479 Shareholders' reports - printing and mailing expenses 301,524 24,458 Stock exchange listing fees 149,396 21,464 Investor relations expense 364,173 21,908 Other expenses 59,925 4,892 - ----------------------------------------------------------------------------------------------------------------------------------- Total expenses before custodian fee credit 12,696,960 735,059 Custodian fee credit (145,612) (8,697) - ----------------------------------------------------------------------------------------------------------------------------------- Net expenses 12,551,348 726,362 - ----------------------------------------------------------------------------------------------------------------------------------- Net investment income 99,466,513 5,415,096 - ----------------------------------------------------------------------------------------------------------------------------------- REALIZED AND UNREALIZED GAIN (LOSS) FROM INVESTMENTS Net realized gain from investment transactions 1,440,337 30,208 Change in net unrealized appreciation (depreciation) of investments 81,296,118 (607,664) - ----------------------------------------------------------------------------------------------------------------------------------- Net gain (loss) from investments 82,736,455 (577,456) - ----------------------------------------------------------------------------------------------------------------------------------- Net increase in net assets from operations $182,202,968 $4,837,640 =================================================================================================================================== See accompanying notes to financial statements.
Statement of Changes in Net Assets
MUNICIPAL VALUE (NUV) MUNICIPAL INCOME (NMI) ----------------------------------- ------------------------------- YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED 10/31/01 10/31/00 10/31/01 10/31/00 - ----------------------------------------------------------------------------------------------------------------------------------- OPERATIONS Net investment income $ 99,466,513 $ 101,169,378 $ 5,415,096 $ 5,586,898 Net realized gain (loss) from investment transactions 1,440,337 4,597,296 30,208 (476,451) Change in net unrealized appreciation (depreciation) of investments 81,296,118 50,413,638 (607,664) (2,382,682) - ----------------------------------------------------------------------------------------------------------------------------------- Net increase in net assets from operations 182,202,968 156,180,312 4,837,640 2,727,765 - ----------------------------------------------------------------------------------------------------------------------------------- DISTRIBUTIONS TO SHAREHOLDERS From undistributed net investment income (99,918,088) (99,546,449) (5,604,202) (5,579,745) From accumulated net realized gains from investment transactions (4,112,336) -- -- (461,215) - ----------------------------------------------------------------------------------------------------------------------------------- Decrease in net assets from distributions to shareholders (104,030,424) (99,546,449) (5,604,202) (6,040,960) - ----------------------------------------------------------------------------------------------------------------------------------- CAPITAL SHARE TRANSACTIONS Net proceeds from shares issued to shareholders due to reinvestment of distributions -- -- 640,957 404,802 - ----------------------------------------------------------------------------------------------------------------------------------- Net increase (decrease) in net assets 78,172,544 56,633,863 (125,605) (2,908,393) Net assets at the beginning of year 1,903,966,927 1,847,333,064 88,214,251 91,122,644 - ----------------------------------------------------------------------------------------------------------------------------------- Net assets at the end of year $1,982,139,471 $1,903,966,927 $88,088,646 $88,214,251 =================================================================================================================================== Balance of undistributed net investment income at the end of year $ 1,657,666 $ 2,109,241 $ 4,942 $ 194,048 =================================================================================================================================== See accompanying notes to financial statements.
Notes to Financial Statements 1. GENERAL INFORMATION AND SIGNIFICANT ACCOUNTING POLICIES The National Funds (the "Funds") covered in this report and their corresponding New York Stock Exchange symbols are Nuveen Municipal Value Fund, Inc. (NUV) and Nuveen Municipal Income Fund, Inc. (NMI). Each Fund seeks to provide current income exempt from regular federal income tax by investing primarily in a diversified portfolio of municipal obligations issued by state and local government authorities. The Funds are registered under the Investment Company Act of 1940 as closed-end, diversified management investment companies. The following is a summary of significant accounting policies followed by the Funds in the preparation of their financial statements in accordance with accounting principles generally accepted in the United States. Securities Valuation The prices of municipal bonds in each Fund's investment portfolio are provided by a pricing service approved by the Fund's Board of Directors. When price quotes are not readily available (which is usually the case for municipal securities), the pricing service establishes fair market value based on yields or prices of municipal bonds of comparable quality, type of issue, coupon, maturity and rating, indications of value from securities dealers and general market conditions. If it is determined that market prices for a security are unavailable or inappropriate, the Board of Directors of the Funds may establish a fair value for the security. Temporary investments in securities that have variable rate and demand features qualifying them as short-term securities are valued at amortized cost, which approximates market value. Securities Transactions Securities transactions are recorded on a trade date basis. Realized gains and losses from such transactions are determined on the specific identification method. Securities purchased or sold on a when-issued or delayed delivery basis may have extended settlement periods. The securities so purchased are subject to market fluctuation during this period. The Funds have instructed the custodian to segregate assets in a separate account with a current value at least equal to the amount of the when-issued and delayed delivery purchase commitments. At October 31, 2001, Municipal Value (NUV) had outstanding when-issued purchase commitments of $20,716,668. There were no such outstanding purchase commitments in Municipal Income (NMI). Investment Income Interest income is determined on the basis of interest accrued, adjusted for amortization of premiums and accretion of discounts on long-term debt securities. Federal Income Taxes Each Fund is a separate taxpayer for federal income tax purposes. Each Fund intends to comply with the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its net investment income to its shareholders. Therefore, no federal income tax provision is required. Furthermore, each Fund intends to satisfy conditions which will enable interest from municipal securities, which is exempt from regular federal income tax, to retain such tax-exempt status when distributed to shareholders of the Funds. All monthly tax-exempt income dividends paid during the fiscal year ended October 31, 2001, have been designated Exempt Interest Dividends. Dividends and Distributions to Shareholders Tax-exempt net investment income is declared monthly as a dividend and payment is made or reinvestment is credited to shareholder accounts on the first business day after month-end. Net realized capital gains and/or market discount from investment transactions, if any, are distributed to shareholders not less frequently than annually. Furthermore, capital gains are distributed only to the extent they exceed available capital loss carryforwards. Distributions to shareholders of tax-exempt net investment income, net realized capital gains and/or market discount 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 accounting principles generally accepted in the United States. Accordingly, temporary over-distributions as a result of these differences may occur and will be classified as either distributions in excess of net investment income, distributions in excess of net realized gains and/or distributions in excess of net ordinary taxable income from investment transactions, where applicable. Notes to Financial Statements (continued) Custodian Fee Credit Each Fund has an arrangement with the custodian bank whereby certain custodian fees and expenses are reduced by credits earned on each Fund's cash on deposit with the bank. Such deposit arrangements are an alternative to overnight investments. Derivative Financial Instruments The Funds may invest in certain derivative financial instruments including futures, forward, swap and option contracts, and other financial instruments with similar characteristics. Although the Funds are authorized to invest in such financial instruments, and may do so in the future, they did not make any such investments during the fiscal year ended October 31, 2001. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States 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. Audit Guide In November 2000, the American Institute of Certified Public Accountants (AICPA) issued a revised version of the AICPA Audit and Accounting Guide for Investment Companies (the "Guide"). The Guide is effective for annual financial statements issued for fiscal years beginning after December 15, 2000. It is not anticipated that the adoption of the Guide will have a significant effect on the financial statements. 2. FUND SHARES Transactions in shares were as follows:
MUNICIPAL VALUE (NUV) MUNICIPAL INCOME (NMI) ----------------------- ----------------------- YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED 10/31/01 10/31/00 10/31/01 10/31/00 - ----------------------------------------------------------------------------------------- Shares issued to shareholders due to reinvestment of distributions -- -- 55,036 35,420 =========================================================================================
3. DISTRIBUTIONS TO SHAREHOLDERS The Funds declared dividend distributions from their tax-exempt net investment income which were paid on December 3, 2001, to shareholders of record on November 15, 2001, as follows: MUNICIPAL MUNICIPAL VALUE (NUV) INCOME (NMI) - -------------------------------------------------------------------------------- Dividend per share $.0425 $.0560 ================================================================================ 4. SECURITIES TRANSACTIONS Purchases and sales (including maturities) of investments in long-term municipal securities and short-term municipal securities for the fiscal year ended October 31, 2001, were as follows: MUNICIPAL MUNICIPAL VALUE (NUV) INCOME (NMI) - -------------------------------------------------------------------------------- Purchases: Long-term municipal securities $217,397,620 $14,612,771 Short-term municipal securities 37,565,000 5,165,000 Sales and maturities: Long-term municipal securities 197,317,334 9,752,555 Short-term municipal securities 37,565,000 9,165,000 ================================================================================ At October 31, 2001, the cost of investments owned for federal income tax purposes were as follows: MUNICIPAL MUNICIPAL VALUE (NUV) INCOME (NMI) - -------------------------------------------------------------------------------- $1,857,070,068 $88,381,104 ================================================================================ At October 31, 2001, Municipal Income (NMI) had unused capital loss carryforwards of $446,243 available for federal income tax purposes to be applied against future capital gains, if any. If not applied, the carryforwards will expire in the year 2008. 5. UNREALIZED APPRECIATION (DEPRECIATION) Gross unrealized appreciation and gross unrealized depreciation of investments for federal income tax purposes at October 31, 2001, were as follows: MUNICIPAL MUNICIPAL VALUE (NUV) INCOME (NMI) - -------------------------------------------------------------------------------- Gross unrealized: appreciation $151,932,022 $ 4,486,790 depreciation (12,522,576) (6,450,593) - -------------------------------------------------------------------------------- Net unrealized appreciation (depreciation) $139,409,446 $(1,963,803) ================================================================================ Notes to Financial Statements (continued) 6. MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES Under the Funds' investment management agreements with Nuveen Advisory Corp. (the "Adviser"), a wholly owned subsidiary of The John Nuveen Company, each Fund pays to the Adviser an annual management fee, payable monthly, at the rates set forth below, which are based upon the average daily net assets of each Fund as follows: AVERAGE DAILY NET ASSETS MUNICIPAL VALUE (NUV) - -------------------------------------------------------------------------------- For the first $500 million .3500 of 1% For the next $500 million .3250 of 1 For net assets over $1 billion .3000 of 1 ================================================================================ AVERAGE DAILY NET ASSETS MUNICIPAL INCOME (NMI) - -------------------------------------------------------------------------------- For the first $125 million .6500 of 1% For the next $125 million .6375 of 1 For the next $250 million .6250 of 1 For the next $500 million .6125 of 1 For the next $1 billion .6000 of 1 For the next $3 billion .5875 of 1 For net assets over $5 billion .5750 of 1 ================================================================================ In addition, Municipal Value (NUV) pays an annual management fee, payable monthly, based on gross interest income as follows: Gross Interest Income MUNICIPAL VALUE (NUV) - -------------------------------------------------------------------------------- For the first $50 million 4.125% For the next $50 million 4.000 For gross income over $100 million 3.875 ================================================================================ The fee compensates the Adviser for overall investment advisory and administrative services and general office facilities. The Funds pay no compensation directly to those of its Directors who are affiliated with the Adviser or to their officers, all of whom receive remuneration for their services to the Funds from the Adviser. 7. COMPOSITION OF NET ASSETS At October 31, 2001, net assets consisted of:
MUNICIPAL MUNICIPAL VALUE (NUV) INCOME (NMI) - --------------------------------------------------------------------------------------------------- Shares, $.01 par value per share $ 1,949,595 $ 80,651 Paid-in surplus 1,837,697,688 90,413,099 Balance of undistributed net investment income 1,657,666 4,942 Accumulated net realized gain (loss) from investment transactions 1,278,520 (446,243) Net unrealized appreciation (depreciation) of investments 139,556,002 (1,963,803) - --------------------------------------------------------------------------------------------------- Net assets $1,982,139,471 $ 88,088,646 =================================================================================================== Authorized shares 350,000,000 200,000,000 ===================================================================================================
8. INVESTMENT COMPOSITION At October 31, 2001, the revenue sources by municipal purpose, expressed as a percent of long-term investments, were as follows: MUNICIPAL MUNICIPAL VALUE (NUV) INCOME (NMI) - -------------------------------------------------------------------------------- Basic Materials --% 8% Education and Civic Organizations 2 4 Healthcare 16 11 Housing/Multifamily 3 4 Housing/Single Family 4 4 Long-Term Care 1 6 Tax Obligation/General 5 14 Tax Obligation/Limited 12 8 Transportation 8 9 U.S. Guaranteed 10 10 Utilities 30 20 Water and Sewer 7 -- Other 2 2 - -------------------------------------------------------------------------------- 100% 100% ================================================================================ Certain long-term investments owned by the Funds are either covered by insurance issued by several private insurers or are backed by an escrow or trust containing U.S. Government or U.S. Government agency securities, both of which ensure the timely payment of principal and interest in the event of default (40% for Municipal Value (NUV) and 18% for Municipal Income (NMI)). Such insurance or escrow, however, does not guarantee the market value of the municipal securities or the value of the Funds' shares. For additional information regarding each investment security, refer to the Portfolio of Investments of each Fund. Financial Highlights Selected data for a share outstanding throughout each year ended October 31:
INVESTMENT OPERATIONS LESS DISTRIBUTIONS --------------------------------- ----------------------------- NET REALIZED/ BEGINNING NET UNREALIZED NET NET ASSET INVESTMENT INVESTMENT INVESTMENT CAPITAL VALUE INCOME GAIN (LOSS) TOTAL INCOME GAINS TOTAL - ------------------------------------------------------------------------------------------------------- MUNICIPAL VALUE (NUV) - ------------------------------------------------------------------------------------------------------- Year Ended 10/31: 2001 $ 9.77 $.51 $ .42 $ .93 $(.51) $(.02) $(.53) 2000 9.48 .52 .28 .80 (.51) -- (.51) 1999 10.37 .51 (.80) (.29) (.51) (.09) (.60) 1998 10.29 .53 .21 .74 (.53) (.13) (.66) 1997 10.18 .58 .22 .80 (.58) (.11) (.69) MUNICIPAL INCOME (NMI) - ------------------------------------------------------------------------------------------------------- Year Ended 10/31: 2001 11.01 .67 (.06) .61 (.70) -- (.70) 2000 11.43 .70 (.36) .34 (.70) (.06) (.76) 1999 12.10 .70 (.61) .09 (.69) (.07) (.76) 1998 12.02 .71 .11 .82 (.71) (.03) (.74) 1997 11.96 .76 .11 .87 (.76) (.05) (.81) ======================================================================================================= TOTAL RETURNS ------------------------------- ENDING NET ASSET ENDING BASED ON BASED ON NET VALUE MARKET VALUE MARKET VALUE+ ASSET VALUE+ - ---------------------------------------------------------------------------------- MUNICIPAL VALUE (NUV) - ---------------------------------------------------------------------------------- Year Ended 10/31: 2001 $10.17 $ 9.4800 17.32% 9.77% 2000 9.77 8.5625 5.46 8.71 1999 9.48 8.6250 (7.50) (2.94) 1998 10.37 9.9375 10.55 7.49 1997 10.29 9.6250 10.39 8.18 MUNICIPAL INCOME (NMI) - ---------------------------------------------------------------------------------- Year Ended 10/31: 2001 10.92 11.9000 12.24 5.68 2000 11.01 11.2500 9.45 3.02 1999 11.43 11.0000 (5.77) .74 1998 12.10 12.4375 5.21 7.06 1997 12.02 12.5625 11.96 7.60 ================================================================================== RATIOS/SUPPLEMENTAL DATA -------------------------------------------------------------------------------------- BEFORE CREDIT AFTER CREDIT* --------------------------- -------------------------- RATIO OF NET RATIO OF NET RATIO OF INVESTMENT RATIO OF INVESTMENT ENDING EXPENSES INCOME TO EXPENSES INCOME TO PORTFOLIO NET ASSETS TO AVERAGE AVERAGE TO AVERAGE AVERAGE TURNOVER (000) NET ASSETS NET ASSETS NET ASSETS NET ASSETS RATE - --------------------------------------------------------------------------------------------------------------- MUNICIPAL VALUE (NUV) - --------------------------------------------------------------------------------------------------------------- Year Ended 10/31: 2001 $1,982,139 .65% 5.09% .64% 5.10% 10% 2000 1,903,967 .65 5.44 .64 5.44 17 1999 1,847,333 .65 5.09 .65 5.10 13 1998 2,022,282 .65 5.18 .65 5.18 19 1997 2,005,380 .68 5.71 .68 5.71 19 MUNICIPAL INCOME (NMI) - --------------------------------------------------------------------------------------------------------------- Year Ended 10/31: 2001 88,089 .83 6.14 .83 6.15 11 2000 88,214 .80 6.20 .77 6.23 6 1999 91,123 .82 5.88 .82 5.89 31 1998 95,756 .82 5.91 .82 5.91 23 1997 94,283 .83 6.39 .83 6.39 9 ============================================================================================================== * After custodian fee credit, where applicable. + Total Investment Return on Market Value is the combination of reinvested dividend income, reinvested capital gains distributions, if any, and changes in stock price per share. Total Return on Net Asset Value is the combination of reinvested dividend income, reinvested capital gains distributions, if any, and changes in net asset value per share. Total returns are not annualized. See accompanying notes to financial statements.
Build Your Wealth Automatically NUVEEN EXCHANGE-TRADED FUNDS DIVIDEND REINVESTMENT PLAN Your Nuveen Exchange-Traded Fund allows you to conveniently reinvest dividends and/or capital gains distributions in additional fund shares. By choosing to reinvest, you'll be able to invest money regularly and automatically, and watch your investment grow through the power of tax-free compounding. Just like dividends or distributions in cash, there may be times when income or capital gains taxes may be payable on dividends or distributions that are reinvested. It is important to note that an automatic reinvestment plan does not ensure a profit, nor does it protect you against loss in a declining market. EASY AND CONVENIENT To make recordkeeping easy and convenient, each month you'll receive a statement showing your total dividends and distributions, the date of investment, the shares acquired and the price per share, and the total number of shares you own. HOW SHARES ARE PURCHASED The shares you acquire by reinvesting will either be purchased on the open market or newly issued by the Fund. If the shares are trading at or above net asset value at the time of valuation, the Fund will issue new shares at the then-current market price. If the shares are trading at less than net asset value, shares for your account will be purchased on the open market. Dividends and distributions received to purchase shares in the open market will normally be invested shortly after the dividend payment date. No interest will be paid on dividends and distributions awaiting reinvestment. Because the market price of shares may increase before purchases are completed, the average purchase price per share may exceed the market price at the time of valuation, resulting in the acquisition of fewer shares than if the dividend or distribution had been paid in shares issued by the Fund. A pro rata portion of any applicable brokerage commissions on open market purchases will be paid by Plan participants. These commissions usually will be lower than those charged on individual transactions. FLEXIBILITY You may change your distribution option or withdraw from the Plan at any time, should your needs or situation change. Should you withdraw, you can receive a certificate for all whole shares credited to your reinvestment account and cash payment for fractional shares, or cash payment for all reinvestment account shares, less brokerage commissions and a $2.50 service fee. You can reinvest whether your shares are registered in your name, or in the name of a brokerage firm, bank, or other nominee. Ask your investment advisor if his or her firm will participate on your behalf. Participants whose shares are registered in the name of one firm may not be able to transfer the shares to another firm and continue to participate in the Plan. The Fund reserves the right to amend or terminate the Plan at any time. Although the Fund reserves the right to amend the Plan to include a service charge payable by the participants, there is no direct service charge to participants in the Plan at this time. For more information on the Nuveen Automatic Reinvestment Plan or to enroll in or withdraw from the Plan, speak with your financial advisor or call us at (800) 257-8787. Sidebar text: Nuveen makes reinvesting easy. A phone call is all it takes to set up your reinvestment account. Fund Information BOARD OF DIRECTORS Robert P. Bremner Lawrence H. Brown Anne E. Impellizzeri Peter R. Sawers William J. Schneider Timothy R. Schwertfeger Judith M. Stockdale FUND MANAGER Nuveen Advisory Corp. 333 West Wacker Drive Chicago, IL 60606 CUSTODIAN, TRANSFER AGENT AND SHAREHOLDER SERVICES JPMorgan Chase Bank 4 New York Plaza New York, NY 10004-2413 (800) 257-8787 LEGAL COUNSEL Morgan, Lewis & Bockius LLP Washington, D.C. INDEPENDENT AUDITORS Ernst & Young LLP Chicago, IL Each Fund intends to repurchase shares of its own common or preferred stock in the future at such times and in such amounts as is deemed advisable. No shares were repurchased during the twelve-month period ended October 31, 2001. Any future repurchases will be reported to shareholders in the next annual or semiannual report. Serving Investors for Generations Photo of: John Nuveen, Sr. For over a century, generations of Americans have relied on Nuveen Investments to help them grow and keep the money they've earned. Financial advisors, investors and their families have associated Nuveen Investments with quality, expertise and dependability since 1898. That is why financial advisors have entrusted the assets of more than 1.3 million investors to Nuveen. With the know-how that comes from a century of experience, Nuveen continues to build upon its reputation for quality. Now, financial advisors and investors can count on Nuveen Investments to help them design customized solutions that meet the far-reaching financial goals unique to family wealth strategies - solutions that can translate into legacies. To find out more about how Nuveen Investments' products and services can help you preserve your financial security, talk with your financial advisor, or call us at (800) 257-8787 for more information, including a prospectus where applicable. Please read that information carefully before you invest. Invest well. Look ahead. LEAVE YOUR MARK.(SM) Logo: NUVEEN Investments Nuveen Investments o 333 West Wacker Drive Chicago, IL 60606 o www.nuveen.com FAN-1-10-01 -----END PRIVACY-ENHANCED MESSAGE-----