UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
Investment Company Act file number: | 811-02992 | |
Exact name of registrant as specified in charter: | Prudential National Muni Fund, Inc. f/k/a Dryden National Municipals Fund, Inc. | |
Address of principal executive offices: | Gateway Center 3, 100 Mulberry Street, Newark, New Jersey 07102 | |
Name and address of agent for service: | Deborah A. Docs Gateway Center 3, 100 Mulberry Street, Newark, New Jersey 07102 | |
Registrant’s telephone number, including area code: | 800-225-1852 | |
Date of fiscal year end: | 8/31/2010 | |
Date of reporting period: | 2/28/2010 |
Item 1 – Reports to Stockholders
SEMIANNUAL REPORT | FEBRUARY 28, 2010 |
Prudential National Muni Fund, Inc.
(Formerly known as Dryden National Municipals Fund)
Fund Type Municipal bond
Objective High level of current income exempt from federal income taxes | This report is not authorized for distribution to prospective investors unless preceded or accompanied by a current prospectus.
The views expressed in this report and information about the Fund’s portfolio holdings are for the period covered by this report and are subject to change thereafter.
The accompanying financial statements as of February 28, 2010, were not audited and, accordingly, no auditor’s opinion is expressed on them.
Prudential Investments, Prudential Financial, and the Rock Prudential logo are registered service marks of The Prudential Insurance Company of America, Newark, NJ, and its affiliates. |
To enroll in e-delivery, go to www.prudentialfunds.com/edelivery |
April 15, 2010
Dear Shareholder:
Recently we announced the renaming of JennisonDryden, Prudential Financial’s mutual fund family, to Prudential Investments. As a result of this change, each of our funds has been renamed to feature “Prudential” as part of its new name. The name of your fund has changed from the Dryden National Municipal Fund, Inc. to the Prudential National Muni Fund, Inc.
While the name of your fund has changed, its investment objectives and portfolio management team remain the same. No action is required on your part. If you participate in an automatic investment plan, your account continues to be invested in the Fund under its new name.
Featuring the Prudential name in our funds creates an immediate connection to the experience and heritage of Prudential, a name recognized by millions for helping people grow and protect their wealth.
On the following pages, you will find your fund’s semiannual report, including a table showing fund performance over the first half of the fiscal year and for longer periods. The report also contains a listing of the fund’s holdings at period-end. If you have questions about your fund or the renaming of our mutual fund family, please contact your financial professional or visit our website at www.prudentialfunds.com.
Sincerely,
Judy A. Rice, President
Prudential National Muni Fund, Inc.
Prudential National Muni Fund, Inc. | 1 |
Your Fund’s Performance
Fund objective
The investment objective of the Prudential National Muni Fund, Inc. is to seek a high level of current income exempt from federal income taxes. There can be no assurance that the Fund will achieve its investment objective.
Performance data quoted represent past performance. Past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate, so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the past performance data quoted. An investor may obtain performance data as of the most recent month-end by visiting our website at www.prudentialfunds.com or by calling (800) 225-1852. The maximum initial sales charge is 4.00% (Class A shares). Gross operating expenses: Class A, 0.87%; Class B, 1.07%; Class C, 1.57%; Class Z, 0.57%. Net operating expenses apply to: Class A, 0.82%; Class B, 1.07%; Class C, 1.32%; Class Z, 0.57%, after contractual reduction through 12/31/2010.
Cumulative Total Returns as of 2/28/10 | ||||||||||||
Six Months | One Year | Five Years | Ten Years | |||||||||
Class A | 3.99 | % | 10.60 | % | 19.12 | % | 64.69 | % | ||||
Class B | 3.86 | 10.31 | 17.65 | 60.72 | ||||||||
Class C | 3.73 | 10.04 | 16.26 | 56.88 | ||||||||
Class Z | 4.12 | 10.88 | 20.63 | 68.86 | ||||||||
Barclays Capital Municipal Bond Index1 | 4.13 | 9.98 | 24.63 | 76.25 | ||||||||
Lipper General Municipal Debt Funds Avg.2 | 4.80 | 12.74 | 16.42 | 58.42 | ||||||||
Average Annual Total Returns3 as of 3/31/10 | ||||||||||||
One Year | Five Years | Ten Years | ||||||||||
Class A | 6.43 | % | 2.87 | % | 4.47 | % | ||||||
Class B | 5.57 | 3.28 | 4.64 | |||||||||
Class C | 9.30 | | 3.21 | 4.39 | ||||||||
Class Z | 11.15 | 3.97 | 5.16 | |||||||||
Barclays Capital Municipal Bond Index1 | 9.69 | 4.58 | 5.58 | |||||||||
Lipper General Municipal Debt Funds Avg.2 | 12.86 | 3.18 | 4.45 |
2 | Visit our website at www.prudentialfunds.com |
Distributions and Yields as of 2/28/10 | ||||||||||||
Total Dividends Paid for Six Months | 30-Day SEC Yield | Taxable Equivalent 30-Day Yield4 at Federal Tax Rates of | ||||||||||
33% | 35% | |||||||||||
Class A | $ | 0.30 | 3.18 | % | 4.75 | % | 4.89 | % | ||||
Class B | 0.28 | 3.05 | 4.55 | 4.69 | ||||||||
Class C | 0.27 | 2.80 | 4.18 | 4.31 | ||||||||
Class Z | 0.32 | 3.56 | 5.31 | 5.48 |
The cumulative total returns do not reflect the deduction of applicable sales charges. If reflected, the applicable sales charges would reduce the cumulative total returns performance quoted. Class A shares are subject to a maximum front-end sales charge of 4.00%. Under certain circumstances, Class A shares may be subject to a contingent deferred sales charge (CDSC) of 1%. Class B and Class C shares are subject to a maximum CDSC of 5% and 1%, respectively. Class Z shares are not subject to a sales charge.
Source: Prudential Investments LLC and Lipper Inc. Performance figures may reflect fee waivers and/or expense reimbursements. In the absence of such fee waivers and/or expense reimbursements, total returns would be lower.
1The Barclays Capital Municipal Bond Index is an unmanaged index of over 39,000 long-term investment-grade municipal bonds. It gives a broad look at how long-term investment-grade municipal bonds have performed.
2The Lipper General Municipal Debt Funds Average (Lipper Average) represents returns based on an average return of all funds in the Lipper General Municipal Debt Funds category for the periods noted. Funds in the Lipper Average invest primarily in municipal debt issues in the top four credit ratings.
3The average annual total returns take into account applicable sales charges. Class A, Class B, and Class C shares are subject to an annual distribution and service (12b-1) fee of up to 0.30%, 0.50%, and 1.00%, respectively. Approximately seven years after purchase, Class B shares will automatically convert to Class A shares on a quarterly basis. Class Z shares are not subject to a 12b-1 fee. The returns in the tables do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or following the redemption of Fund shares.
4Some investors may be subject to the federal alternative minimum tax (AMT) and/or state and local taxes. Taxable equivalent yields reflect federal taxes only.
Investors cannot invest directly in an index. The returns for the Barclays Capital Municipal Bond Index would be lower if they included the effects of sales charges, operating expenses of a mutual fund, or taxes. Returns for the Lipper Average reflect the deduction of operating expenses, but not sales charges or taxes.
Prudential National Muni Fund, Inc. | 3 |
Your Fund’s Performance (continued)
Five Largest Issues expressed as a percentage of net assets as of 2/28/10 | |||
Puerto Rico Comnwlth., G.O., A.M.B.A.C.-T.C.R.S., 7.00%, 07/01/10 | 1.4 | % | |
Massachusetts St., G.O., Ser. B, Assured qty., 5.25%, 09/01/24 | 1.3 | ||
Denver City & Cnty. Arpt. Rev. Sys., Ser. A, NATL 5.00%, 11/15/25 | 1.2 | ||
Salt River Proj. Arizona Agric. Impt. & Pwr. Dist. Elec. Sys. Rev., Ser. A, 5.00%, 01/01/39 | 1.2 | ||
Pennsylvania St. Ind. Dev. Auth. Rev., Econ. Dev., A.M.B.A.C., 5.50%, 07/01/17 | 1.1 |
Issues are subject to change.
Credit Quality* expressed as a percentage of net assets as of 2/28/10 | |||
Aaa | 6.2 | % | |
Aa | 37.0 | ||
A | 35.2 | ||
Baa | 15.7 | ||
Ba | 0.9 | ||
Caa | 0.2 | ||
Not Rated | 4.6 | ||
Total Investments | 99.8 | ||
Other assets in excess of liabilities | 0.2 | ||
Net Assets | 100.0 | % | |
*Source: Moody’s rating, defaulting to S&P when not rated by Moody’s.
Credit Quality is subject to change.
4 | Visit our website at www.prudentialfunds.com |
Fees and Expenses (Unaudited)
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemptions, as applicable, and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses, as applicable. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The example is based on an investment of $1,000 invested on September 1, 2009, at the beginning of the period, and held through the six-month period ended February 28, 2010. The example is for illustrative purposes only; you should consult the Prospectus for information on initial and subsequent minimum investment requirements.
The Fund’s transfer agent may charge additional fees to holders of certain accounts that are not included in the expenses shown in the table on the following page. These fees apply to individual retirement accounts (IRAs) and Section 403(b) accounts. As of the close of the six-month period covered by the table, IRA fees included an annual maintenance fee of $15 per account (subject to a maximum annual maintenance fee of $25 for all accounts held by the same shareholder). Section 403(b) accounts are charged an annual $25 fiduciary maintenance fee. Some of the fees may vary in amount, or may be waived, based on your total account balance or the number of Prudential Investments funds, including the Fund, that you own. You should consider the additional fees that were charged to your Fund account over the six-month period when you estimate the total ongoing expenses paid over the period and the impact of these fees on your ending account value, as these additional expenses are not reflected in the information provided in the expense table. Additional fees have the effect of reducing investment returns.
Actual Expenses
The first line for each share class in the table on the following page provides information about actual account values and actual expenses. You may use the information on this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value ÷ $1,000 = 8.6), then multiply the result by the number on the first line under the heading “Expenses Paid During the Six-Month Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line for each share class in the table on the following page provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and
Prudential National Muni Fund, Inc. | 5 |
Fees and Expenses (continued)
expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs such as sales charges (loads). Therefore, the second line for each share class in the table is useful in comparing ongoing costs only and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Prudential National Muni Fund, Inc. | Beginning Account Value September 1, 2009 | Ending Account Value February 28, 2010 | Annualized Expense Ratio Based on the Six-Month Period | Expenses Paid During the Six-Month Period* | ||||||||||
Class A | Actual | $ | 1,000.00 | $ | 1,039.90 | 0.82 | % | $ | 4.15 | |||||
Hypothetical | $ | 1,000.00 | $ | 1,020.73 | 0.82 | % | $ | 4.11 | ||||||
Class B | Actual | $ | 1,000.00 | $ | 1,038.60 | 1.07 | % | $ | 5.41 | |||||
Hypothetical | $ | 1,000.00 | $ | 1,019.49 | 1.07 | % | $ | 5.36 | ||||||
Class C | Actual | $ | 1,000.00 | $ | 1,037.30 | 1.32 | % | $ | 6.67 | |||||
Hypothetical | $ | 1,000.00 | $ | 1,018.25 | 1.32 | % | $ | 6.61 | ||||||
Class Z | Actual | $ | 1,000.00 | $ | 1,041.20 | 0.57 | % | $ | 2.88 | |||||
Hypothetical | $ | 1,000.00 | $ | 1,021.97 | 0.57 | % | $ | 2.86 |
* Fund expenses (net of fee waivers or subsidies, if any) for each share class are equal to the annualized expense ratio for each share class (provided in the table), multiplied by the average account value over the period, multiplied by the 181 days in the six-month period ended February 28, 2010, and divided by the 365 days in the Fund's fiscal year ending August 31, 2010 (to reflect the six-month period). Expenses presented in the table include the expenses of any underlying portfolios in which the Fund may invest.
6 | Visit our website at www.prudentialfunds.com |
Portfolio of Investments
as of February 28, 2010 (Unaudited)
Description (a) | Moody’s Ratings+* | Interest Rate | Maturity Date | Principal Amount (000) | Value (Note 1) | |||||||
LONG-TERM INVESTMENTS 98.5% | ||||||||||||
Alaska 0.2% | ||||||||||||
Alaska Student Loan Corp. Ed. Ln. Rev., Ser. A-2, A.M.T. | AAA(d) | 5.000% | 6/01/18 | $ | 2,000 | $ | 2,069,820 | |||||
Arizona 3.4% | ||||||||||||
Arizona Health Facs. Auth. Rev., Banner Health, Ser. D | A+(d) | 5.500 | 1/01/38 | 2,500 | 2,541,200 | |||||||
Arizona St. Ctfs. Part. Dept. Admin., Ser. A, Assured Gty. | Aa3 | 5.250 | 10/01/28 | 2,000 | 2,079,400 | |||||||
Arizona St. Trans. Brd. Excise Tax Rev., Maricopa Cnty. Regl. Reg. Area Rd. | Aa2 | 5.000 | 7/01/25 | 2,000 | 2,209,620 | |||||||
Maricopa Cnty. Indl. Dev. Auth. Health Facs. Rev., Catholic Healthcare West, Ser. A | A2 | 5.250 | 7/01/32 | 2,500 | 2,470,650 | |||||||
Phoenix Civic Impt. Corp., Wtr. Sys. Rev., Jr. Lien, Ser. A | Aa3 | 5.000 | 7/01/39 | 5,000 | 5,157,950 | |||||||
Pima Cnty. Uni. Sch. Dist. No. 1, G.O., NATL | A1 | 7.500 | 7/01/10 | 3,000 | 3,069,660 | |||||||
Salt River Proj. Arizona Agric. Impt. & Pwr. Dist. Elec. Sys. Rev., Ser. A, | Aa1 | 5.000 | 1/01/39 | 9,750 | 10,130,835 | |||||||
Tucson Cnty., G.O., Ser. A, | Aa3 | 7.375 | 7/01/12 | 1,100 | 1,260,875 | |||||||
28,920,190 | ||||||||||||
California 7.8% | ||||||||||||
Anaheim Pub. Fin. Auth. Lease Rev., Assured Gty. | Aa3 | 6.000 | 9/01/24 | 5,500 | 6,280,835 | |||||||
Sub. Pub. Impts. Proj., Ser. C | Aa3 | 6.000 | 9/01/16 | 6,690 | 7,534,211 | |||||||
California Cnty. Tobacco Securitization Corp., Tobacco Conv. Bonds Asset Bk., Ser. B | NR | 5.100 | 6/01/28 | 1,250 | 1,060,788 | |||||||
California Edl. Facs. Auth. Rev., Calif. Inst. of Technology | Aa1 | 5.000 | 11/01/39 | 1,500 | 1,593,330 | |||||||
Univ. Southern Calif., Ser. A | Aa1 | 5.000 | 10/01/38 | 3,000 | 3,110,160 | |||||||
Univ. Southern Calif., Ser. A | Aa1 | 5.250 | 10/01/38 | 1,000 | 1,064,680 |
See Notes to Financial Statements.
Prudential National Muni Fund, Inc. | 7 |
Portfolio of Investments
as of February 28, 2010 (Unaudited) continued
Description (a) | Moody’s Ratings+* | Interest Rate | Maturity Date | Principal Amount (000) | Value (Note 1) | |||||||
California (cont’d.) | ||||||||||||
California Health Facs. Fin. Auth. Rev., Rfdg., | A2 | 5.000% | 11/15/21 | $ | 1,000 | $ | 1,034,580 | |||||
Scripps Health, Ser. A | A1 | 5.000 | 11/15/36 | 1,000 | 964,230 | |||||||
California Infrastructure & Econ. Dev. Bk. Rev. & Econ. Dev., | A1 | 5.250 | 2/01/38 | 3,000 | 3,011,460 | |||||||
California Poll. Ctl. Fin. Auth. Solid Wste. Disp. Rev., | A3 | 4.750 | 12/01/23 | 2,500 | 2,426,300 | |||||||
Wste. Mgmt., Inc. Proj., Ser. B, A.M.T. | BBB(d) | 5.000 | 7/01/27 | 1,000 | 973,470 | |||||||
California St., G.O., | A1 | 5.250 | 7/01/21 | 3,875 | 4,298,886 | |||||||
F.G.I.C., T.C.R.S. | Baa1 | 4.750 | 9/01/23 | 1,500 | 1,498,500 | |||||||
Var. Purp. | Baa1 | 5.000 | 10/01/29 | 2,000 | 1,910,880 | |||||||
Var. Purp. | Baa1 | 5.500 | 11/01/39 | 1,000 | 965,890 | |||||||
Var. Purp. | Baa1 | 6.000 | 4/01/38 | 3,500 | 3,606,050 | |||||||
Var. Purp. | Baa1 | 6.000 | 11/01/39 | 2,000 | 2,063,500 | |||||||
Elsinore Valley Muni. Wtr. Dist. Ctfs. Part. Rfdg., Ser. A, B.H.A.C. | Aa1 | 5.000 | 7/01/29 | 1,500 | 1,585,845 | |||||||
Folsom Cordova Uni. Sch. Dist., Sch. Facs. Impvt. Dist., No. 2, G.O., Ser. A, C.A.B.S., NATL | A1 | 5.730(i) | 10/01/21 | 60 | 31,461 | |||||||
Fresno Calif. Swr. Rev., Ser. A, Assured Gty. | Aa3 | 5.000 | 9/01/33 | 2,500 | �� | 2,548,600 | ||||||
Golden St. Tobacco Securitization Corp., Tobacco Settlement Rev., C.A.B.S. Asset Bkd., Ser. A-2 (Converts to 5.30% on 12/01/12) | Baa3 | 7.290(i) | 6/01/37 | 5,000 | 3,176,200 | |||||||
C.A.B.S., Asset Bkd., Ser. A, A.M.B.A.C. (Converts to 4.60% on 6/01/10) | Baa2 | 5.830(i) | 6/01/23 | 2,000 | 1,750,480 | |||||||
Enhanced Asset Bkd., Ser. A | Baa2 | 5.000 | 6/01/45 | 1,000 | 839,990 | |||||||
M-S-R Energy Auth., Ser. A | A(d) | 6.500 | 11/01/39 | 2,000 | 2,114,580 | |||||||
Pittsburg Redev. Agcy. Tax Alloc., Los Medanos Cmnty. Dev. Proj., C.A.B.S., A.M.B.A.C. | NR | 6.440(i) | 8/01/25 | 2,000 | 763,400 |
See Notes to Financial Statements.
8 | Visit our website at www.prudentialfunds.com |
Description (a) | Moody’s Ratings+* | Interest Rate | Maturity Date | Principal Amount (000) | Value (Note 1) | |||||||
California (cont’d.) | ||||||||||||
San Joaquin Hills Trans. Corridor Agcy. Toll Road Rev., Ser. A, C.A.B.S., NATL | Baa1 | 8.550(i)% | 1/15/36 | $ | 21,000 | $ | 2,404,290 | |||||
Santa Margarita Dana Point Auth. Impvt. Rev., Dists. 3, 3A, 4, 4A, Ser. B, NATL | Baa1 | 7.250 | 8/01/14 | 2,000 | 2,373,140 | |||||||
Tuolumne Wind Proj. Auth., Tuolumne Co. Proj., Ser. A | A1 | 5.625 | 1/01/29 | 1,000 | 1,071,490 | |||||||
University Calif. Rev., | ||||||||||||
Ser. O | Aa1 | 5.750 | 5/15/34 | 750 | 833,813 | |||||||
Ser. Q | Aa1 | 5.000 | 5/15/34 | 1,000 | 1,040,240 | |||||||
Unrefunded Bal., U.C.L.A. Med. Center, Ser. A, A.M.B.A.C. | NR | 5.250 | 5/15/30 | 850 | 847,833 | |||||||
Ventura Cnty. Cmnty. College. Dist., Election 2002, Ser. C, G.O. | Aa3 | 5.500 | 8/01/33 | 2,000 | 2,097,480 | |||||||
66,876,592 | ||||||||||||
Colorado 2.5% | ||||||||||||
Colorado Health Facs. Auth. Rev., Adventist Health/Sunbelt, Ser. D | A1 | 5.250 | 11/15/35 | 3,500 | 3,485,020 | |||||||
Rmk. Poudre Valley, Ser. A, Assured Gty. | Aa3 | 5.200 | 3/01/31 | 2,000 | 2,027,480 | |||||||
Denver City & Cnty. Arpt. Rev. Sys., Ser. A, NATL | A1 | 5.000 | 11/15/25 | 10,000 | 10,487,400 | |||||||
Ser. B, A.M.T., NATL | A1 | 5.000 | 11/15/15 | 2,500 | 2,713,625 | |||||||
Platte Riv. Pwr. Auth. Colo. Pwr. Rev., Ser. HH | Aa2 | 5.000 | 6/01/27 | 1,500 | 1,632,030 | |||||||
University Colo. Enterprise Sys. Rev., Ser. A | Aa3 | 5.375 | 6/01/32 | 1,000 | 1,067,180 | |||||||
21,412,735 | ||||||||||||
Connecticut 0.4% | ||||||||||||
Connecticut St. Health & Edl. Facs. Auth. Rev., Yale Univ. X-3 | Aaa | 4.850 | 7/01/37 | 2,835 | 2,961,242 | |||||||
Connecticut St. Spl. Tax Oblig. Rev., Trans. Infrastructure, Ser. A (Partially Pre-refunded Date 6/01/08)(b) | Aaa | 7.125 | 6/01/10 | 355 | 361,337 | |||||||
3,322,579 |
See Notes to Financial Statements.
Prudential National Muni Fund, Inc. | 9 |
Portfolio of Investments
as of February 28, 2010 (Unaudited) continued
Description (a) | Moody’s Ratings+* | Interest Rate | Maturity Date | Principal Amount (000) | Value (Note 1) | |||||||
District of Columbia 2.0% | ||||||||||||
District of Columbia Rev., Brookings Inst. | Aa3 | 5.750% | 10/01/39 | $ | 5,000 | $ | 5,388,600 | |||||
District of Columbia Wtr. & Swr. Auth., Pub. Util. Rev., Ser. A | Aa3 | 5.500 | 10/01/39 | 2,000 | 2,141,200 | |||||||
District of Columbia, G.O., Ser. E, B.H.A.C. | Aa1 | 5.000 | 6/01/28 | 5,000 | 5,298,050 | |||||||
Metropolitan Washington DC Arpt. Auth. Sys., | ||||||||||||
Ser. A, A.M.T. | Aa3 | 5.250 | 10/01/27 | 1,000 | 1,025,680 | |||||||
Ser. B, A.M.B.A.C., A.M.T. | Aa3 | 5.000 | 10/01/32 | 3,725 | 3,689,985 | |||||||
17,543,515 | ||||||||||||
Florida 7.4% | ||||||||||||
Bayside Impvt. Cmnty. Dev. Dist., Cap. Impvt. Rev., Ser. A | NR | 6.300 | 5/01/18 | 410 | 356,872 | |||||||
Citizens Ppty. Ins. Corp., Sr. Secd. High Act-A-1 | A2 | 6.000 | 6/01/16 | 1,500 | 1,670,205 | |||||||
Florida St. Brd. Ed. Cap., Outlay, G.O. | Aa1 | 9.125 | 6/01/14 | 1,000 | 1,130,640 | |||||||
Florida St. Brd. Ed. Lottery Rev., Ser. B | A2 | 5.000 | 7/01/23 | 5,185 | 5,627,281 | |||||||
Florida St. Dept. Environ. Prot. Pres. Rev., Florida Forever, Ser. A, NATL | A1 | 5.250 | 7/01/17 | 2,950 | 3,114,610 | |||||||
Greater Orlando Aviation, Auth. Arpt. Facs. Rev., Ser. A, Assured Gty., A.M.T. | Aa3 | 5.000 | 10/01/23 | 4,240 | 4,312,970 | |||||||
Halifax Hosp. Med. Ctr. Rev., Ser. B2, Assured Gty. | AAA(d) | 5.375 | 6/01/31 | 4,000 | 4,038,160 | |||||||
Highlands Cmnty. Dev. Dist. Rev., Spl. Assmt.(c)(f) | NR | 5.550 | 5/01/36 | 500 | 251,840 | |||||||
Highlands Cnty. Health Facs. Auth. Rev., | A1 | 5.000 | 11/15/25 | 205 | 239,924 | |||||||
Adventist Health/Sunbelt, Ser. B Rmkt. | A1 | 6.000 | 11/15/37 | 2,440 | 2,573,883 | |||||||
Adventist, Unrefunded Bal., Ser. B | A1 | 5.000 | 11/15/25 | 1,410 | 1,423,367 | |||||||
Hillsborough Cnty. Aviation Auth. Rev., Tampa Int’l. Arpt., Ser. A, A.M.T., NATL | Aa3 | 5.500 | 10/01/15 | 1,000 | 1,086,040 |
See Notes to Financial Statements.
10 | Visit our website at www.prudentialfunds.com |
Description (a) | Moody’s Ratings+* | Interest Rate | Maturity Date | Principal Amount (000) | Value (Note 1) | |||||||
Florida (cont’d.) | ||||||||||||
Jacksonville Aviation Auth. Rev., A.M.T., A.M.B.A.C. | A2 | 5.000% | 10/01/26 | $ | 1,855 | $ | 1,859,044 | |||||
Jacksonville Econ. Dev. Cmnty., Anheuser Busch Proj., Ser. B, A.M.T. | Baa2 | 4.750 | 3/01/47 | 1,500 | 1,261,155 | |||||||
Jacksonville Elec. Auth. Rev., St. Johns Rvr. Pwr. Park Issue 2, Ser. 7, C.A.B.S. | Aa2 | 0.680(i) | 10/01/10 | 1,000 | 996,010 | |||||||
Miami Dade Cnty. Aviation Rev., Miami Int’l. Arpt., | A2 | 5.375 | 10/01/35 | 1,600 | 1,616,016 | |||||||
Ser. C, A.M.T., Assured Gty. | Aa3 | 5.250 | 10/01/26 | 5,000 | 5,116,000 | |||||||
Miami Dade Cnty. Wtr. & Swr. Rev., Rfdg. Sys., Ser. B, Assured Gty. | Aa3 | 5.250 | 10/01/22 | 5,000 | 5,641,600 | |||||||
Orlando Util. Commn. Sys. Rev., Ser. A | Aa1 | 5.250 | 10/01/39 | 5,000 | 5,300,200 | |||||||
Ser. B, Rfdg. | Aa1 | 5.000 | 10/01/33 | 1,000 | 1,040,740 | |||||||
Palm Beach Cnty. Arpt. Sys. Rev., Ser. A, A.M.T., NATL | A2 | 5.000 | 10/01/34 | 1,250 | 1,163,038 | |||||||
Paseo Cmnty. Dev. Dist. Cap. Impvt. Rev., Ser. A (original cost $300,000; purchased 6/17/05)(c)(f)(h) | NR | 5.400 | 5/01/36 | 300 | 119,892 | |||||||
Polk Cnty. Sch. Dist. Sales Tax Rev., | Aa3 | 5.250 | 10/01/17 | 2,580 | 2,939,549 | |||||||
Sch. Impvt., Assured Gty. | Aa3 | 5.250 | 10/01/18 | 2,325 | 2,575,589 | |||||||
Reunion West Cmnty. Dev. Dist. Spl. Assmt. Rev., | NR | 6.250 | 5/01/36 | 985 | 405,928 | |||||||
South Lake Cnty. Hosp. Dist. Rev., South Lake Hosp., Ser. A | Baa2 | 6.250 | 4/01/39 | 2,500 | 2,530,575 | |||||||
South Miami Health Facs. Auth. Hosp. Rev., Baptist Health South Fl. Grp. | Aa3 | 5.000 | 8/15/27 | 3,750 | 3,820,125 | |||||||
West Palm Beach Cmnty. Redev. Agy., Northwood-Pleasant Cmnty. Redev., Tax Allocation Rev. | A(d) | 5.000 | 3/01/35 | 1,000 | 903,600 | |||||||
63,114,853 |
See Notes to Financial Statements.
Prudential National Muni Fund, Inc. | 11 |
Portfolio of Investments
as of February 28, 2010 (Unaudited) continued
Description (a) | Moody’s Ratings+* | Interest Rate | Maturity Date | Principal Amount (000) | Value (Note 1) | |||||||
Georgia 3.4% | ||||||||||||
Athens Clarke Cnty. Univs., Govt. Wtr. & Swr. Rev., | Aa3 | 5.625% | 1/01/33 | $ | 2,000 | $ | 2,177,820 | |||||
Burke Cnty. Dev. Auth. Poll. Ctl. Rev., Oglethorepe Pwr. Vogtle. Proj., Ser. B | A3 | 5.500 | 1/01/33 | 750 | 775,515 | |||||||
Forsyth Cnty. Sch. Dist. Dev., G.O. | Aa2 | 6.750 | 7/01/16 | 500 | 592,330 | |||||||
Fulton Cnty. Sch. Dist., G.O. | Aa2 | 6.375 | 5/01/17 | 750 | 924,758 | |||||||
Gainesville & Hall Cnty. Hosp. Auth. Rev., Antic Ctfs., | ||||||||||||
Northeast Healthcare, Ser. A | A-(d) | 5.375 | 2/15/40 | 3,000 | 2,885,610 | |||||||
Georgia St. Rd. & Twy. Auth. Rev., Fed. Hwy. Grant. Antic. Bds., Ser. A | Aa3 | 5.000 | 6/01/18 | 3,500 | 4,043,445 | |||||||
Ser. A | Aa3 | 5.000 | 6/01/21 | 1,000 | 1,127,710 | |||||||
Gwinnett Cnty. Hosp. Auth. Rev., Gwinnett Hosp. Sys., Ser. D, Assured Gty. | Aa3 | 5.500 | 7/01/41 | 1,500 | 1,512,975 | |||||||
Metropolitan Atlanta Rapid Tran. Auth., Sales Tax Rev., Ser. 3 | Aa3 | 5.000 | 7/01/39 | 4,000 | 4,157,200 | |||||||
Newnan Hosp. Auth. Rev., Antic Ctfs. Newnan Hosp., Inc., NATL (Pre-refunded Date 1/01/13) | A2 | 5.500 | 1/01/21 | 3,185 | 3,597,808 | |||||||
Private Colleges & Univs. Auth. Rev., Emory Univ., Ser. C | Aa2 | 5.250 | 9/01/39 | 5,000 | 5,371,699 | |||||||
Richmond Cnty. Hosp. Rev., Rev. Antic Ctfs. Univ. Health Svcs., Inc., Proj. | A1 | 5.500 | 1/01/36 | 2,000 | 1,999,840 | |||||||
29,166,710 | ||||||||||||
Guam 0.1% | ||||||||||||
Guam Govt. Wtrwks. Auth., | ||||||||||||
Wtr. & Wstewtr. Sys. Rev. | Ba2 | 6.000 | 7/01/25 | 500 | 501,990 | |||||||
Hawaii 0.9% | ||||||||||||
Hawaii St. Dept. Budget & Fin. Spl. Purp. Rev., Hawaiian Elec. Co. Inc. Proj., Ser. C., A.M.B.A.C., A.M.T. | Baa1 | 6.200 | 11/01/29 | 8,000 | 8,059,520 |
See Notes to Financial Statements.
12 | Visit our website at www.prudentialfunds.com |
Description (a) | Moody’s Ratings+* | Interest Rate | Maturity Date | Principal Amount (000) | Value (Note 1) | |||||||
Idaho 0.3% | ||||||||||||
Idaho Health Facs. Auth. Rev., Trinity Health Grp., Ser. B | Aa2 | 6.250% | 12/01/33 | $ | 1,000 | $ | 1,098,150 | |||||
Idaho Hsg. & Fin. Assn., Grant & Rev., Antic. Fed. Hwy. Tran., Ser. A | Aa3 | 5.000 | 7/15/27 | 1,250 | 1,338,875 | |||||||
2,437,025 | ||||||||||||
Illinois 8.2% | ||||||||||||
Chicago Midway Arpt. Rev., Ser. B., A.M.T., NATL | A2 | 5.750 | 1/01/22 | 5,000 | 5,003,800 | |||||||
Chicago O’Hare Int’l. Arpt. Rev., Gen. Arpt. 3rd Lien, | A1 | 5.250 | 1/01/26 | 6,000 | 6,228,720 | |||||||
Ser. B, Rfdg., NATL | A1 | 5.250 | 1/01/15 | 1,000 | | 1,129,160 | ||||||
Ser. B-1, X.L.C.A. | A1 | 5.250 | 1/01/34 | 1,975 | 1,983,038 | |||||||
Chicago Rfdg. Proj., G.O., Ser. A, Assured Gty. | Aa3 | 5.000 | 1/01/29 | 5,000 | 5,221,100 | |||||||
Gilberts Spl. Svc. Area No. 9 Spl. Tax, Big Timber Proj. (Pre-refunded Date 3/01/11)(b) | AAA(d) | 7.750 | 3/01/27 | 2,000 | 2,187,220 | |||||||
Illinois Ed. Facs. Auth. Student Hsg. Rev., Ed. Advancement Fund, Ser. B | Baa3 | 5.000 | 5/01/30 | 4,000 | 3,303,080 | |||||||
Illinois Fin. Auth. Rev., | Aa2 | 5.375 | 4/01/44 | 2,000 | 2,042,460 | |||||||
Central DuPage Health, Ser. 09 | AAA(d) | 5.250 | 11/01/39 | 2,000 | 2,037,860 | |||||||
Central DuPage Health, Ser. B | AA(d) | 5.500 | 11/01/39 | 1,500 | 1,556,880 | |||||||
Northwestern Mem. Hosp., Ser. A, (Pre-refunded Date 8/15/14)(b) | NR | 5.250 | 8/15/34 | 5,000 | 5,822,450 | |||||||
Northwestern Mem. Hosp., Ser. A | Aa2 | 6.000 | 8/15/39 | 1,000 | 1,100,030 | |||||||
Provena Health, Ser. A | Baa1 | 6.000 | 5/01/28 | 1,500 | 1,478,640 | |||||||
Univ. of Chicago, Ser. B | Aa1 | 6.250 | 7/01/38 | 5,000 | 5,658,700 | |||||||
Illinois St., G.O., | Aa3 | 5.000 | 1/01/23 | 3,000 | 3,196,770 | |||||||
Ser. 1st, Assured Gty. | Aa3 | 5.250 | 4/01/22 | 2,500 | 2,628,275 | |||||||
Illinois Toll Hwy. Auth. Rev., | Aa3 | 5.500 | 1/01/33 | 2,000 | 2,141,800 | |||||||
Sr. Prority, Sr. A-1, Assured Gty. | Aa3 | 5.000 | 1/01/24 | 5,000 | 5,338,250 |
See Notes to Financial Statements.
Prudential National Muni Fund, Inc. | 13 |
Portfolio of Investments
as of February 28, 2010 (Unaudited) continued
Description (a) | Moody’s Ratings+* | Interest Rate | Maturity Date | Principal Amount (000) | Value (Note 1) | |||||||
Illinois (cont’d.) | ||||||||||||
Metropolitan Pier & Exposition Auth. Dedicated St. Tax Rev., Cap. Apprec. McCormick Place Expansion, | A3 | 5.250% | 6/15/42 | $ | 8,500 | $ | 8,578,711 | |||||
Ser. A, NATL | A3 | 6.170(i) | 12/15/34 | 10,000 | 2,215,300 | |||||||
Ser. A, NATL | A3 | 6.230(i) | 6/15/37 | 7,500 | 1,404,825 | |||||||
70,257,069 | ||||||||||||
Indiana 1.1% | ||||||||||||
Indiana St. Fin. Auth., | A2 | 4.950 | 10/01/40 | 2,750 | 2,687,960 | |||||||
Var. Duke Energy Ind., Ser. B | A(d) | 6.000 | 8/01/39 | 1,000 | 1,083,020 | |||||||
Indianapolis Ind. Loc. Pub. Impt. Bd. Bk. Wtr. Wks. Proj., Ser. A | A3 | 5.750 | 1/01/38 | 1,000 | 1,053,750 | |||||||
Indianapolis Loc. Pub. Impt. Arpt. Auth. Rev., Ser. F, A.M.B.A.C., A.M.T. | A1 | 5.000 | 1/01/36 | 5,000 | 4,650,400 | |||||||
9,475,130 | ||||||||||||
Kansas 1.2% | ||||||||||||
Kansas St. Dev. Fin. Auth. Hosp. Rev., Adventist Health | A1 | 5.750 | 11/15/38 | 1,000 | 1,062,640 | |||||||
Sedgwick & Shawnee Cnty. Sngl. Fam. Hsg. Rev., | Aaa | 5.700 | 12/01/27 | 1,145 | 1,227,818 | |||||||
Ser. A, A.M.T., G.N.M.A., F.N.M.A. | Aaa | 5.750 | 6/01/27 | 1,140 | 1,224,246 | |||||||
Ser. A, A.M.T., G.N.M.A., F.N.M.A. | Aaa | 5.850 | 12/01/27 | 1,110 | 1,195,514 | |||||||
Wyandotte Cnty. Kansas City Unified Gov. Util. Sys. Rev., Rfdg., Ser. 2004, A.M.B.A.C. | A+(d) | 5.650 | 9/01/19 | 5,000 | 5,674,450 | |||||||
10,384,668 | ||||||||||||
Kentucky 1.1% | ||||||||||||
Kentucky Econ. Dev. Fin. Auth. Hosp. Facs. Rev., Owensboro Med. Helth. Sys., Ser. A | Baa2 | 6.375 | 6/01/40 | 2,500 | 2,491,375 | |||||||
Kentucky St. Ppty. & Bldgs. Commn. Rev., Proj. No 93, Rfdg., Assured Gty. | Aa3 | 5.250 | 2/01/28 | 5,500 | 5,951,770 |
See Notes to Financial Statements.
14 | Visit our website at www.prudentialfunds.com |
Description (a) | Moody’s Ratings+* | Interest Rate | Maturity Date | Principal Amount (000) | Value (Note 1) | |||||||
Kentucky (cont’d.) | ||||||||||||
Owen Cnty. Wtrwks. Sys. Rev., | Baa2 | 6.250% | 6/01/39 | $ | 500 | $ | 531,735 | |||||
Var. Amer. Wtr. Co., Ser. B | Baa2 | 5.625 | 9/01/39 | 500 | 513,145 | |||||||
9,488,025 | ||||||||||||
Louisiana 0.9% | ||||||||||||
Louisiana Loc. Govt. Environ. Facs. & Cmnty. Dev. Auth., Jefferson Parish., Ser. A | Aa3 | 5.375 | 4/01/31 | 1,000 | 1,047,940 | |||||||
Louisiana Pub. Facs. Auth. Hosp. Rev., Franciscan Missionaries | A2 | 6.750 | 7/01/39 | 1,000 | 1,078,940 | |||||||
Louisiana St. Citizens Pty. Inc., Corp. Assmt. Rev., Rmkt., Ser. C-2, Assured Gty. | Aa3 | 6.750 | 6/01/26 | 2,000 | 2,335,780 | |||||||
New Orleans, G.O., Rfdg., NATL | Baa1 | 5.250 | 12/01/22 | 3,540 | 3,649,846 | |||||||
8,112,506 | ||||||||||||
Maryland 0.4% | ||||||||||||
Maryland St. Health & Higher Edl. Facs. Auth. Rev., Univ. Maryland Med. Sys. | A2 | 5.000 | 7/01/34 | 2,000 | 1,988,720 | |||||||
Maryland St. Indl. Dev. Fin. Auth., Synagro Baltimore, Ser. A, Rfdg., A.M.T. | NR | 5.250 | 12/01/13 | 600 | 603,816 | |||||||
Takoma Park Hosp. Facs. Rev., Washington Adventist Hosp., E.T.M., Assured Gty.(b) | Aa3 | 6.500 | 9/01/12 | 620 | 672,043 | |||||||
3,264,579 | ||||||||||||
Massachusetts 5.2% | ||||||||||||
Boston Ind. Dev. Fin. Auth. Swr. Facs. Rev., Harbor Elec. Energy Co. Proj., A.M.T. | Aa3 | 7.375 | 5/15/15 | 790 | 792,994 | |||||||
Massachusetts Bay Trans. Auth. Rev., | Aa1 | 5.250 | 7/01/34 | 2,000 | 2,152,300 | |||||||
Mass. Sales Tax, Ser. B, NATL | Aa2 | 5.500 | 7/01/27 | 1,325 | 1,592,226 | |||||||
Massachusetts Edl. Fin. Auth. Rev., Ser. B, A.M.T. | AA(d) | 5.500 | 1/01/23 | 1,000 | 1,013,580 |
See Notes to Financial Statements.
Prudential National Muni Fund, Inc. | 15 |
Portfolio of Investments
as of February 28, 2010 (Unaudited) continued
Description (a) | Moody’s Ratings+* | Interest Rate | Maturity Date | Principal Amount (000) | Value (Note 1) | |||||||
Massachusetts (cont’d.) | ||||||||||||
Massachusetts St. Health & Edl. Facs. Auth. Rev., | ||||||||||||
Caritas Christi Obligation, Ser. B | Baa2 | 6.750% | 7/01/16 | $ | 3,590 | $ | 3,766,520 | |||||
Harvard Univ., Ser. A | Aaa | 5.500 | 11/15/36 | 3,500 | 3,902,115 | |||||||
Partners Healthcare, Ser. J1, Assured Gty. | Aa2 | 5.000 | 7/01/39 | 2,500 | 2,488,400 | |||||||
Simmons College, Ser. D, A.M.B.A.C. (Pre-refunded Date 10/01/10)(b) | Baa1 | 6.050 | 10/01/20 | 1,000 | 1,043,450 | |||||||
Tufts Univ., Ser. M | Aa2 | 5.500 | 2/15/28 | 3,000 | 3,555,720 | |||||||
Valley Region Health Sys., Ser. C, CONNIE LEE | Baa2 | 7.000 | 7/01/10 | 825 | 832,260 | |||||||
Massachusetts St. Port Auth. Spl. Facs. Rev., Bosfuel Proj., A.M.T., NATL | A3 | 5.000 | 7/01/32 | 5,000 | 4,748,100 | |||||||
Massachusetts St. Wtr. Poll. Abatement Tr. St. Revolving Fd., Ser. 14 | Aaa | 5.000 | 8/01/38 | 2,000 | 2,113,900 | |||||||
Massachusetts St., G.O., | Aa2 | 5.000 | 8/01/19 | 2,000 | 2,278,760 | |||||||
Fltg.-Cons. Ln., Ser. A, NATL(j) | Aa2 | 0.737 | 5/01/37 | 5,000 | 3,627,500 | |||||||
Ser. B, Assured Gty. | Aa2 | 5.250 | 9/01/24 | 9,000 | 10,757,610 | |||||||
44,665,435 | ||||||||||||
Michigan 2.1% | ||||||||||||
Detroit Sew. Disp. Rev., Sr. Lien-Remkt., Ser. 2003B, Assured Gty. | Aa3 | 7.500 | 7/01/33 | 1,000 | 1,198,850 | |||||||
Detroit Wtr. Supply Sys., Ser. B, NATL (Pre-refunded Date 7/01/13)(b) | A(d) | 5.250 | 7/01/32 | 5,500 | 6,242,170 | |||||||
Michigan Higher Ed. Student Ln. Auth. Rev., Student Ln., Ser. XVII-Q, A.M.B.A.C., A.M.T. | A1 | 5.000 | 3/01/31 | 3,000 | 2,737,800 | |||||||
Michigan St. Hosp. Fin. Auth. Rev., Henry Ford Health, Ser. A | A1 | 5.250 | 11/15/46 | 2,000 | 1,774,580 | |||||||
McLaren Healthcare | Aa3 | 5.750 | 5/15/38 | 1,000 | 1,018,240 | |||||||
Michigan St. Strategic Fd. Ltd. Oblig. Rev., Adj. Rfdg., Dow. Chemical Rmkt., Ser. B | Baa3 | 6.250 | 6/01/14 | 1,000 | 1,127,410 |
See Notes to Financial Statements.
16 | Visit our website at www.prudentialfunds.com |
Description (a) | Moody’s Ratings+* | Interest Rate | Maturity Date | Principal Amount (000) | Value (Note 1) | |||||||
Michigan (cont’d.) | ||||||||||||
Okemos Pub. Sch. Dist., G.O., | A1 | 2.040%(i) | 5/01/12 | $ | 1,100 | $ | 1,052,766 | |||||
C.A.B.S., NATL | A1 | 2.370(i) | 5/01/13 | 1,000 | 928,500 | |||||||
Royal Oak Mich. Hosp. Fin. Auth. Rev., William Beaumont, Rfdg., Ser. W | A1 | 6.000 | 8/01/39 | 2,000 | 2,008,460 | |||||||
18,088,776 | ||||||||||||
Minnesota 0.4% | ||||||||||||
Southern Minn. Mun. Pwr. Agy. Pwr. Supply Sys. Rev. , Ser. A | A2 | 5.250 | 1/01/30 | 2,000 | 2,102,400 | |||||||
St. Cloud Healthcare Rev., Centracare Health Sys., Ser. A | A2 | 5.125 | 5/01/30 | 1,000 | 991,850 | |||||||
St. Paul Minn. Hsg. & Redev. Auth. Health Care Rev., Allina Health Sys., Ser. A-1 | A1 | 5.250 | 11/15/29 | 750 | 749,025 | |||||||
3,843,275 | ||||||||||||
Nevada 0.3% | ||||||||||||
Clark Cnty. Passenger Facs. Charge Rev., Las Vegas McCarran Int’l. Arpt., Ser. A | Aa3 | 5.125 | 7/01/34 | 3,000 | 2,952,630 | |||||||
New Hampshire 0.8% | ||||||||||||
Manchester Hsg. & Redev. Auth. Rev., Ser. B, C.A.B.S., A.C.A. | Ba2 | 9.000(i) | 1/01/24 | 4,740 | 1,438,400 | |||||||
New Hampshire Health & Edl. Facs. Auth. Rev., | A+(d) | 6.000 | 8/01/38 | 1,750 | 1,833,300 | |||||||
New Hampshire College (Pre-refunded Date 1/01/11)(b) | BBB(d) | 7.500 | 1/01/31 | 3,000 | 3,200,190 | |||||||
6,471,890 | ||||||||||||
New Jersey 6.7% | ||||||||||||
Cape May Cnty. Ind. Poll. Ctrl., Fin. Auth. Rev., Atlantic City Elec. Co., Ser. A, NATL | Baa1 | 6.800 | 3/01/21 | 2,615 | 3,208,553 | |||||||
Clearview Reg. High Sch. Dist., G.O., NATL | NR | 5.375 | 8/01/15 | 1,205 | 1,348,419 | |||||||
Jackson Twnshp. Sch. Dist., G.O., NATL | A(d) | 6.600 | 6/01/11 | 1,600 | 1,710,656 |
See Notes to Financial Statements.
Prudential National Muni Fund, Inc. | 17 |
Portfolio of Investments
as of February 28, 2010 (Unaudited) continued
Description (a) | Moody’s Ratings+* | Interest Rate | Maturity Date | Principal Amount (000) | Value (Note 1) | |||||||
New Jersey (cont’d.) | ||||||||||||
Jersey City Sew. Auth., Swr. Rfdg., A.M.B.A.C. | NR | 6.250% | 1/01/14 | $ | 4,255 | $ | 4,676,712 | |||||
New Jersey Edl. Dev. Auth., | ||||||||||||
Cigarette Tax | Baa2 | 5.625 | 6/15/19 | 1,750 | 1,750,910 | |||||||
Cigarette Tax | Baa2 | 5.750 | 6/15/34 | 1,750 | 1,679,143 | |||||||
First Mtge.—Franciscan Oaks | NR | 5.700 | 10/01/17 | 2,040 | 2,036,389 | |||||||
First Mtge.—Keswick Pines | NR | 5.750 | 1/01/24 | 1,750 | 1,542,993 | |||||||
Masonic Charity Fdn. Proj. | A-(d) | 5.875 | 6/01/18 | 250 | 259,545 | |||||||
Masonic Charity Fdn. Proj. | A-(d) | 6.000 | 6/01/25 | 1,150 | 1,184,477 | |||||||
New Jersey Health Care Facs. Fin. Auth. Rev., | A2 | 6.250 | 7/01/17 | 1,740 | 1,944,467 | |||||||
Atlantic City Med. Ctr., Unrefunded Bal. | A2 | 6.250 | 7/01/17 | 2,185 | 2,310,048 | |||||||
South Jersey Hosp. | A2 | 6.000 | 7/01/26 | 2,565 | 2,872,595 | |||||||
South Jersey Hosp. | A2 | 6.000 | 7/01/32 | 2,000 | 2,239,840 | |||||||
St. Peter’s Univ. Hosp., Ser. A | Baa2 | 6.875 | 7/01/30 | 3,750 | 3,756,863 | |||||||
Virtua Health, A.G.C. | AAA(d) | 5.500 | 7/01/38 | 2,000 | 2,096,640 | |||||||
New Jersey St. Tpke. Auth., Tpke. Rev., Growth & Income Secs., Ser. B, A.M.B.A.C., C.A.B.S. (Converts to 5.15% on 1/1/15) | A3 | 5.080(i) | 1/01/35 | 3,000 | 2,371,140 | |||||||
Ser. E | A3 | 5.250 | 1/01/40 | 2,000 | 2,080,220 | |||||||
New Jersey St. Trans. Trust Fund Auth. Rev., | A1 | 5.500 | 12/15/23 | 6,000 | 6,851,039 | |||||||
Ser. A | A1 | 5.875 | 12/15/38 | 3,000 | 3,271,830 | |||||||
Rutgers St. Univ. of NJ, Ser. A | Aa3 | 6.400 | 5/01/13 | 1,415 | 1,531,582 | |||||||
Tobacco Settlement Fin. Corp. Rev., Asset Bkd. | Aaa | 6.000 | 6/01/37 | 400 | 446,500 | |||||||
(Pre-refunded Date 6/1/12)(b) | Aaa | 6.125 | 6/01/42 | 2,000 | 2,238,100 | |||||||
Ser. 1A | Baa3 | 4.500 | 6/01/23 | 470 | 445,198 | |||||||
Ser. 1A | Baa3 | 4.625 | 6/01/26 | 1,000 | 825,650 | |||||||
Ser. 1A | Baa3 | 5.000 | 6/01/41 | 4,000 | 2,711,920 | |||||||
57,391,429 |
See Notes to Financial Statements.
18 | Visit our website at www.prudentialfunds.com |
Description (a) | Moody’s Ratings+* | Interest Rate | Maturity Date | Principal Amount (000) | Value (Note 1) | |||||||
New Mexico 0.3% | ||||||||||||
New Mexico Mtge. Fin. Auth. Rev., Sngl. Fam. Mtge., Ser. E, G.N.M.A., F.N.M.A., F.H.L.M.C., A.M.T. | AAA(d) | 5.500% | 7/01/35 | $ | 1,305 | $ | 1,396,075 | |||||
New Mexico St. Hosp. Equip. Ln. Council Hosp. Rev., Presbyterian Healthcare | Aa3 | 5.000 | 8/01/39 | 1,250 | 1,251,813 | |||||||
2,647,888 | ||||||||||||
New York 10.6% | ||||||||||||
Brookhaven Ind. Dev. Agcy. Civic Fac. Rev., Mem. Hosp. Med. Ctr., Inc., Ser. A, | NR | 8.125 | 11/15/20 | 500 | 531,295 | |||||||
Brooklyn Arena Local Dev. Corp., Barclays Ctr. Proj. | Baa3 | 6.375 | 7/15/43 | 750 | 772,485 | |||||||
Islip Res. Rec. Agcy. Rev., Ser. B, A.M.B.A.C.,A.M.T. | A1 | 7.200 | 7/01/10 | 3,495 | 3,565,774 | |||||||
Long Island Pwr. Auth. Elec. Sys. Rev., | A3 | 6.000 | 5/01/33 | 1,000 | 1,126,140 | |||||||
Ser. A | A3 | 6.250 | 4/01/33 | 500 | 575,180 | |||||||
Ser. A, B.H.A.C. | Aa1 | 5.500 | 5/01/33 | 2,000 | 2,174,960 | |||||||
Metropolitan Trans. Auth. Rev., Svc. Contract, | ||||||||||||
Ser. 2008C | A3 | 6.500 | 11/15/28 | 2,500 | 2,866,825 | |||||||
Ser. A, NATL | A1 | 5.500 | 7/01/20 | 2,500 | 2,697,200 | |||||||
Ser. B, NATL | A1 | 5.500 | 7/01/19 | 5,000 | 5,416,600 | |||||||
Ser. B, NATL | A1 | 5.500 | 7/01/23 | 7,285 | 7,750,802 | |||||||
Monroe Cnty. Ind. Dev. Agcy. Civic Fac. Rev., Rfdg. Highland Hosp. Rochester | A2 | 5.000 | 8/01/22 | 2,000 | 2,015,060 | |||||||
New York City Ind. Dev. Agcy. Spl. Fac. Rev., | A3 | 5.500 | 1/01/24 | 1,500 | 1,525,350 | |||||||
N.Y. Stock Exchange Proj. A, Rfdg., | A1 | 4.750 | 5/01/29 | 1,100 | 1,126,004 |
See Notes to Financial Statements.
Prudential National Muni Fund, Inc. | 19 |
Portfolio of Investments
as of February 28, 2010 (Unaudited) continued
Description (a) | Moody’s Ratings+* | Interest Rate | Maturity Date | Principal Amount (000) | Value (Note 1) | |||||||
New York (cont’d.) | ||||||||||||
New York City Mun. Wtr. Fin. Auth. Rev., | Aa2 | 6.000% | 6/15/33 | $ | 985 | $ | 1,009,921 | |||||
Wtr. & Swr., Fiscal 2009, Ser. A | Aa2 | 5.750 | 6/15/40 | 1,000 | 1,118,790 | |||||||
New York City Tr. Cultural Res. Rev., Julliard Sch., Ser. A, | Aa2 | 5.000 | 1/01/39 | 2,500 | 2,627,525 | |||||||
New York City Trans. Fin. Auth. Bldg. Aid. Rev., Fiscal 2009, Ser. S-3 | A1 | 5.250 | 1/15/39 | 1,500 | 1,570,380 | |||||||
New York City, G.O., | ||||||||||||
Ser. A, Unrefunded Bal. | Aa3 | 6.000 | 5/15/30 | 10 | 10,170 | |||||||
Ser. E | Aa3 | 5.000 | 8/01/17 | 6,000 | 6,842,280 | |||||||
Sub. Ser. I-1, | Aa3 | 5.250 | 4/01/28 | 2,000 | 2,162,060 | |||||||
New York Liberty Dev. Corp. Rev., National Sports Museum Proj., Ser. A (original cost $659,999; purchased 8/7/06)(c)(f)(h) | NR | 6.100 | 2/15/19 | 660 | 7 | |||||||
New York St. Dorm. Auth. Rev., | ||||||||||||
Ser . A, A.M.B.A.C. | A1 | 5.250 | 7/01/21 | 2,000 | 2,230,000 | |||||||
Ser. B | A1 | 6.000 | 7/01/14 | 2,550 | 2,795,897 | |||||||
Ser. B (Mandatory Put Date 7/1/13) | Aa3 | 5.250 | 7/01/29 | 3,000 | 3,350,220 | |||||||
Mental Health Svcs. Facs. Impvt., Ser. B | A1 | 6.500 | 8/15/11 | 3,000 | 3,215,820 | |||||||
Non-State Supported Debt., Cornell Univ., Ser. A, G.O. | Aa1 | 5.000 | 7/01/39 | 2,000 | 2,097,300 | |||||||
Rochester Inst. Tech., Ser . A, A.M.B.A.C. | A1 | 5.250 | 7/01/20 | 2,100 | 2,341,269 | |||||||
New York St. Environ. Facs. Corp. Rev., Clean Wtr. & Drinking Revolving Fds. Pooled Fin., | Aaa | 5.500 | 10/15/23 | 3,750 | 4,655,513 | |||||||
Ser. E | Aaa | 6.500 | 6/15/14 | 35 | 35,174 | |||||||
New York City Mun. Wtr. Proj. | Aaa | 5.000 | 6/15/34 | 2,000 | 2,060,680 | |||||||
New York St. Hsg. Fin. Agcy. Rev., St. Univ. Constr., Ser. A, E.T.M.(b) | A1 | 8.000 | 5/01/11 | 1,345 | 1,411,335 | |||||||
New York St. Loc. Gov’t. Assist. Corp. Rev., Ser. E | Aa3 | 6.000 | 4/01/14 | 3,000 | 3,413,940 |
See Notes to Financial Statements.
20 | Visit our website at www.prudentialfunds.com |
Description (a) | Moody’s Ratings+* | Interest Rate | Maturity Date | Principal Amount (000) | Value (Note 1) | |||||||
New York (cont’d.) | ||||||||||||
New York St. Mun. Bond. Bank Agcy. Rev., Spl. Sch. Supply, | A+(d) | 5.250% | 6/01/22 | $ | 3,200 | $ | 3,365,440 | |||||
Ser. C | A+(d) | 5.250 | 12/01/22 | 3,595 | 3,786,434 | |||||||
Port Auth. of New York & New Jersey Cons. Rev., Ser. 127, A.M.B.A.C., A.M.T. | Aa3 | 5.500 | 12/15/15 | 3,000 | 3,199,080 | |||||||
Triborough Bridge & Tunnel Auth. Rev., Ser. C | Aa2 | 5.000 | 11/15/33 | 5,000 | 5,200,300 | |||||||
90,643,210 | ||||||||||||
North Carolina 1.5% | ||||||||||||
North Carolina Eastern Mun. Powr. Agcy., Powr. Sys. Rev., | Aa3 | 6.000 | 1/01/19 | 500 | 562,535 | |||||||
A.M.B.A.C. | Baa1 | 6.000 | 1/01/18 | 1,000 | 1,154,620 | |||||||
Ser. A (Pre-refunded Date 1/01/22)(b) | Aaa | 6.000 | 1/01/26 | 650 | 837,928 | |||||||
Ser. A, E.T.M.(b) | Baa1 | 6.400 | 1/01/21 | 1,000 | 1,244,290 | |||||||
Ser. A, E.T.M.(b)(e) | Aaa | 6.500 | 1/01/18 | 2,635 | 3,349,401 | |||||||
Ser. A, NATL, Unrefunded Bal. | Baa1 | 6.500 | 1/01/18 | 1,005 | 1,194,322 | |||||||
North Carolina Med. Care Commn. Hosp. Rev., Baptist Hosp., Rfdg. | Aa3 | 5.000 | 6/01/34 | 3,000 | 3,002,160 | |||||||
Pitt Cnty. Rev., Mem. Hosp., E.T.M.(b) | Aaa | 5.250 | 12/01/21 | 1,000 | 1,064,270 | |||||||
12,409,526 | ||||||||||||
North Dakota 1.1% | ||||||||||||
Mercer Cnty. Poll. Control Rev., Antelope Valley Station, A.M.B.A.C. | A+(d) | 7.200 | 6/30/13 | 8,300 | 9,064,596 | |||||||
Ohio 3.3% | ||||||||||||
American Mun. Pwr., Inc., Ser. A | Aa3 | 5.000 | 2/01/13 | 2,500 | 2,659,550 | |||||||
Buckeye Ohio Tob. Settlement, Asset Bkd. Sr. Turbo, | Baa3 | 6.500 | 6/01/47 | 4,250 | 3,495,285 | |||||||
Ser. A-2 | Baa3 | 5.125 | 6/01/24 | 1,450 | 1,333,319 | |||||||
Ser. A-2 | Baa3 | 5.875 | 6/01/47 | 1,000 | 748,510 |
See Notes to Financial Statements.
Prudential National Muni Fund, Inc. | 21 |
Portfolio of Investments
as of February 28, 2010 (Unaudited) continued
Description (a) | Moody’s Ratings+* | Interest Rate | Maturity Date | Principal Amount (000) | Value (Note 1) | |||||||
Ohio (cont’d.) | ||||||||||||
Columbus Citation Hsg. Dev. Corp., Mtge. Rev., F.H.A. (Pre-refunded Date 1/01/15)(b) | NR | 7.625% | 1/01/22 | $ | 1,345 | $ | 1,640,792 | |||||
Cuyahoga Cnty. Hosp. Facs. Rev., Canton, Inc. Proj. | Baa1 | 7.500 | 1/01/30 | 5,000 | 5,062,349 | |||||||
Hamilton Cnty. Sales Tax Rev., Sub. Ser. B, A.M.B.A.C., C.A.B.S. | A2 | 4.540(i) | 12/01/20 | 2,000 | 1,240,620 | |||||||
Hilliard Sch. Dist. Sch. Impvt., G.O., C.A.B.S., NATL | Aa2 | 3.670(i) | 12/01/19 | 1,720 | 1,210,312 | |||||||
Lucas Cnty. Health Care Facs. Rev., Sunset Retirement Impvt., Ser. A, Rfdg. | NR | 6.625 | 8/15/30 | 1,000 | 1,008,360 | |||||||
Lucas Cnty. Hosp. Rev., Rfdg., Promedica Healthcare Group, Ser. B, A.M.B.A.C. | NR | 5.000 | 11/15/21 | 3,935 | 4,023,026 | |||||||
Montgomery Cnty. Rev., Miami Valley Hosp., Ser. A | Aa3 | 6.250 | 11/15/39 | 500 | 523,800 | |||||||
Ohio St. Air Quality Dev. Auth. Rev., Poll. Ctl. First Energy, Rfdg., Ser. C | Baa1 | 5.625 | 6/01/18 | 500 | 533,235 | |||||||
Ohio St. Higher Ed. Facility Cmnty. Rev., Case Western Reserve Univ., Ser. B | A1 | 6.500 | 10/01/20 | 750 | 904,193 | |||||||
Ohio St. Wtr. Dev. Auth. Rev., Poll. Ctl. First Energy, Rfdg., Ser. A, First Energy (Mandatory Put Date 6/1/16) | Baa1 | 5.875 | 6/01/33 | 500 | 548,065 | |||||||
Poll. Ctl. Ln. Fd. Wtr. Quality, Ser. A | Aaa | 5.000 | 12/01/29 | 2,150 | 2,329,482 | |||||||
Ohio St. Wtr. Dev. Auth. Solid Wste. Rev., Allied Wste. N. A., Inc. Proj., Ser. A, A.M.T. | A-(d) | 5.150 | 7/15/15 | 750 | 755,978 | |||||||
28,016,876 | ||||||||||||
Oklahoma 0.1% | ||||||||||||
Tulsa Airpts. Impt. Tr. Gen. Rev., Ser. A | A3 | 5.375 | 6/01/24 | 1,000 | 1,028,260 | |||||||
Oregon 0.4% | ||||||||||||
Oregon St. Dept. Trans. Hwy. User Tax Rev., Sr. Lien., Ser. A | Aa2 | 5.000 | 11/15/33 | 3,500 | 3,723,020 |
See Notes to Financial Statements.
22 | Visit our website at www.prudentialfunds.com |
Description (a) | Moody’s Ratings+* | Interest Rate | Maturity Date | Principal Amount (000) | Value (Note 1) | |||||||
Pennsylvania 5.5% | ||||||||||||
Allegheny Cnty. San. Auth. Swr. Rev., NATL, Unrefunded Bal. | Baa1 | 5.500% | 12/01/30 | $ | 460 | $ | 467,066 | |||||
Berks Cnty. Mun. Auth. Hosp. Rev., Reading Hosp. Med. Ctr. Proj., NATL | Aa3 | 5.700 | 10/01/14 | 1,070 | 1,174,336 | |||||||
Bucks Cnty. Wtr. & Swr. Auth. Rev., Ser. A, A.M.B.A.C. | A+(d) | 5.375 | 6/01/16 | 1,080 | 1,164,694 | |||||||
Delaware Cnty. Auth. Rev., Dunwoody Vlge. Proj. (Pre-refunded Date 4/01/10)(b) | BBB+(d) | 6.250 | 4/01/30 | 1,000 | 1,005,390 | |||||||
Delaware River Port Auth. Rev., PA & NJ Port Dist. Proj., | Aa3 | 5.625 | 1/01/26 | 5,000 | 5,004,950 | |||||||
Ser. B, Assured Gty. | Aa3 | 5.700 | 1/01/22 | 1,000 | 1,001,400 | |||||||
Erie Parking Auth. Facs. Rev. Gtd., Assured Gty. (Pre-refunded Date 09/01/13)(b) | Aa3 | 5.000 | 9/01/26 | 70 | 79,652 | |||||||
Lancaster Cnty. Hosp. Auth. Rev., Garden Spot Vlge. Proj., Ser. A (Pre-refunded Date 5/1/10)(b) | NR | 7.625 | 5/01/31 | 1,000 | 1,023,380 | |||||||
Lycoming Cnty. Health Facs. Auth. Rev., Susquehanna Health Sys. Proj., Ser. A | BBB+(d) | 5.750 | 7/01/39 | 2,000 | 1,963,680 | |||||||
Monroe Cnty. Hosp. Auth. Rev., Pocono Med. Center (Pre-refunded Date 1/01/14)(b) | NR | 6.000 | 1/01/43 | 2,500 | 2,915,925 | |||||||
Northampton Cnty. Higher Ed. Auth. Rev., Moravian Coll., A.M.B.A.C. | NR | 6.250 | 7/01/11 | 1,140 | 1,185,076 | |||||||
Pennsylvania Econ. Dev. Fin. Auth. Res. Recov. Rev., Rfdg., Colver Proj., | Ba1 | 4.625 | 12/01/18 | 3,500 | 3,036,285 | |||||||
Ser. F, A.M.B.A.C., A.M.T. | Ba1 | 5.000 | 12/01/15 | 3,000 | 2,914,980 | |||||||
Pennsylvania St. Ind. Dev. Auth. Rev., Econ. Dev., | A3 | 5.500 | 7/01/17 | 9,000 | 9,622,709 | |||||||
A.M.B.A.C. | A3 | 5.500 | 7/01/20 | 2,750 | 2,902,598 | |||||||
Pennsylvania St. Tpke. Comn. Rev., Oil Franchise Tax Rev., Ser. A, A.M.B.A.C., E.T.M. | A1 | 5.250 | 12/01/18 | 1,435 | 1,447,671 |
See Notes to Financial Statements.
Prudential National Muni Fund, Inc. | 23 |
Portfolio of Investments
as of February 28, 2010 (Unaudited) continued
Description (a) | Moody’s Ratings+* | Interest Rate | Maturity Date | Principal Amount (000) | Value (Note 1) | |||||||
Pennsylvania (cont’d.) | ||||||||||||
Philadelphia Auth. Indl. Dev. Rev., Please Touch Museum Proj. Ser. B | BBB-(d) | 5.250% | 9/01/31 | $ | 1,000 | $ | 897,800 | |||||
Philadelphia G.O., Ser. B, Assured Gty. | Aa3 | 7.125 | 7/15/38 | 1,500 | 1,691,520 | |||||||
Philadelphia Hosps. & Higher Ed. Facs. Auth. Hosp. Rev., Grad. Health Sys., Oblig. Gp. (original cost $1,820,479; purchased 4/25/96 - - 7/2/98)(c)(f)(h) | NR | 7.250 | 7/01/18 | 1,803 | 18 | |||||||
Pittsburgh Urban. Redev. Auth., Wtr. & Swr. Sys. Rev., Unrefunded Bal., Rfdg., Ser. A, NATL | Baa1 | 6.500 | 9/01/13 | 2,220 | 2,401,307 | |||||||
Pittsburgh Wtr. & Swr. Auth. Sys. Rev., Ser. A, F.G.I.C., E.T.M.(b) | NR | 6.500 | 9/01/13 | 1,780 | 2,006,149 | |||||||
Unity Twnshp. Mun. Auth., Gtd. Swr. Rev., A.M.B.A.C., C.A.B.S., E.T.M.(b) | NR | 1.140(i) | 11/01/12 | 1,035 | 1,004,022 | |||||||
Washington Cnty. Hosp. Auth. Rev., Monongahela Valley Hosp. | A3 | 6.250 | 6/01/22 | 2,400 | 2,487,312 | |||||||
47,397,920 | ||||||||||||
Puerto Rico 3.7% | ||||||||||||
Puerto Rico Comnwlth., G.O., | ||||||||||||
A.M.B.A.C.—T.C.R.S. | Baa3 | 7.000 | 7/01/10 | 11,530 | 11,743,765 | |||||||
I.B.C., NATL | Baa3 | 7.000 | 7/01/10 | 1,970 | 2,006,524 | |||||||
Pub. IMPT. Ser. C | Baa3 | 6.000 | 7/01/39 | 800 | 821,216 | |||||||
Puerto Rico Comnwlth., Hwy. & Trans. Auth. Rev., | ||||||||||||
Rfdg., Ser. CC | Baa2 | 5.500 | 7/01/28 | 2,500 | 2,549,175 | |||||||
Ser. G, F.G.I.C. | Baa3 | 5.250 | 7/01/18 | 2,250 | 2,299,298 | |||||||
Ser. J (Pre-refunded Date 7/01/14)(b) | Baa3 | 5.500 | 7/01/23 | 1,320 | 1,536,533 | |||||||
Ser. K | Baa3 | 5.000 | 7/01/14 | 2,000 | 2,118,260 | |||||||
Puerto Rico Mun. Fin. Agcy., G.O. | Baa3 | 5.000 | 8/01/12 | 1,000 | 1,057,660 | |||||||
Puerto Rico Pub. Bldgs. Auth. Rev., Gtd. Govt. Fasc., Rfdg., | ||||||||||||
Ser. P | Baa3 | 6.750 | 7/01/36 | 1,000 | 1,086,500 |
See Notes to Financial Statements.
24 | Visit our website at www.prudentialfunds.com |
Description (a) | Moody’s Ratings+* | Interest Rate | Maturity Date | Principal Amount (000) | Value (Note 1) | |||||||
Puerto Rico (cont’d.) | ||||||||||||
Puerto Rico Sales Tax Fin. Corp. Sales Tax Rev., | ||||||||||||
First Sub. Ser. A | A2 | 5.500% | 8/01/42 | $ | 1,750 | $ | 1,744,663 | |||||
First Sub. Ser. A | A2 | 5.750 | 8/01/37 | 1,600 | 1,649,232 | |||||||
First Sub. Ser. A | A2 | 6.000 | 8/01/42 | 2,800 | 2,931,180 | |||||||
31,544,006 | ||||||||||||
Rhode Island 0.9% | ||||||||||||
Rhode Island Health & Ed. Bldg. Corp. Higher Ed. Fac. Rev., | ||||||||||||
Brown Univ. | Aa1 | 5.000 | 9/01/37 | 5,000 | 5,222,650 | |||||||
Lifespan Oblig., Ser. A, Assured Gty. | Aa3 | 7.000 | 5/15/39 | 2,000 | 2,290,160 | |||||||
7,512,810 | ||||||||||||
South Carolina 1.1% | ||||||||||||
South Carolina Jobs Econ. Dev. Auth. Hosp. Facs. Rev., Rfdg. & Impvt., Palmetto Health, Ser. C (Pre-refunded Date 8/01/13)(b) | Baa1 | 6.875 | 8/01/27 | 2,655 | 3,152,096 | |||||||
South Carolina Pub. Svc. Auth. Rev., Santee Cooper, Ser. A | Aa2 | 5.500 | 1/01/38 | 2,500 | 2,699,575 | |||||||
Ser. A, A.M.B.A.C. | Aa2 | 5.000 | 1/01/21 | 3,000 | 3,302,430 | |||||||
9,154,101 | ||||||||||||
South Dakota 0.2% | ||||||||||||
Ed. Enhancement Fin. Fdg. Corp. Rev., Tobacco, Ser. B | Baa3 | 6.500 | 6/01/32 | 1,000 | 987,140 | |||||||
South Dakota Health & Edl. Facs. Auth. Rev., Sanford Health | A1 | 5.500 | 11/01/40 | 625 | 640,506 | |||||||
1,627,646 | ||||||||||||
Tennessee 0.8% | ||||||||||||
Bristol Health & Ed. Facility Rev., Bristol Mem. Hosp., F.G.I.C., E.T.M.(b) | NR | 6.750 | 9/01/10 | 1,775 | 1,834,800 | |||||||
Knox Cnty. Tenn. Health Edl. & Hsg. Facs. Brd. Hosp. Facs., Covenant Health Rev., Rfdg. & Impt., Ser. A, C.A.B.S. | A-(d) | 6.480(i) | 1/01/35 | 1,000 | 210,230 |
See Notes to Financial Statements.
Prudential National Muni Fund, Inc. | 25 |
Portfolio of Investments
as of February 28, 2010 (Unaudited) continued
Description (a) | Moody’s Ratings+* | Interest Rate | Maturity Date | Principal Amount (000) | Value (Note 1) | |||||||
Tennessee (cont’d.) | ||||||||||||
Memphis Shelby Cnty. Arpt. Auth. Rev., Rfdg., Ser. B, A.M.T. | A2 | 5.750% | 7/01/25 | $ | 1,000 | $ | 1,053,330 | |||||
Tennessee Energy Acquisition Corp. Gas Rev., Ser. C | Baa1 | 5.000 | 2/01/18 | 2,000 | 2,043,400 | |||||||
Tennessee Hsg. Dev. Agcy. Rev., Homeownership Program, A.M.T. | Aa1 | 5.000 | 7/01/34 | 1,305 | 1,361,741 | |||||||
6,503,501 | ||||||||||||
Texas 6.0% | ||||||||||||
Austin Elec. Util. Sys. Rev., Rfdg., Ser. A, A.M.B.A.C | A1 | 5.000 | 11/15/22 | 4,610 | 4,949,527 | |||||||
Austin Tex. Wtr. & Wstewtr. Sys. Rev., Austin Wtr. & Swr., | Aa3 | 5.125 | 11/15/29 | 2,000 | 2,144,600 | |||||||
Brazos River Auth. Poll. Ctl. Rev., TXU Rmkt., A.M.T. | Caa3 | 5.400 | 5/01/29 | 1,500 | 718,770 | |||||||
TXU Energy Co. LLC Proj., Ser. D (Mandatory Put Date 10/01/14) | Caa3 | 5.400 | 10/01/29 | 1,000 | 715,310 | |||||||
Harris Cnty. Cultural Edu. Facs. Fin. Corp. Rev., | ||||||||||||
Childrens Hosp. Proj. | Aa2 | 5.000 | 10/01/29 | 1,500 | 1,525,095 | |||||||
Childrens Hosp. Proj., | Aa2 | 5.500 | 10/01/39 | 1,500 | 1,547,310 | |||||||
Methodist Hosp. Sys., Ser. B | AA(d) | 5.500 | 12/01/18 | 1,000 | 1,134,420 | |||||||
Harris Cnty. Indl. Dev. Corp., Solid Wste. Disp. Rev., Deer Park Fing. Proj., LP | A2 | 5.000 | 2/01/23 | 750 | 763,230 | |||||||
Houston Arpt. Sys. Rev., | ||||||||||||
E.T.M.(b) | Aaa | 7.200 | 7/01/13 | 1,835 | 2,054,136 | |||||||
Sr. Lien, Rfdg., Ser. A | Aa3 | 5.500 | 7/01/39 | 1,000 | 1,066,730 | |||||||
Houston Higher Edu. Fin. Corp. Higher Edu. Rev., Rice Univ. | ||||||||||||
Proj., Ser. B | Aaa | 4.750 | 11/15/33 | 3,000 | 3,071,850 | |||||||
Houston Util. Sys. Rev., Rfdg. Comb., 1st Lien, Ser. A, Assured Gty. | Aa3 | 5.250 | 11/15/33 | 1,510 | 1,595,753 | |||||||
Lower Colo. Riv. Auth. Tex. Rev., L.C.R.A. Trans. Svcs., | ||||||||||||
Rfdg., B.H.A.C. | Aa1 | 5.250 | 5/15/28 | 2,000 | 2,137,400 | |||||||
Rfdg. | A1 | 5.750 | 5/15/28 | 3,205 | 3,396,915 |
See Notes to Financial Statements.
26 | Visit our website at www.prudentialfunds.com |
Description (a) | Moody’s Ratings+* | Interest Rate | Maturity Date | Principal Amount (000) | Value (Note 1) | |||||||
Texas (cont’d.) | ||||||||||||
North Tex. Twy. Auth. Rev., | ||||||||||||
First Tier, Rfdg., Ser. A | A2 | 5.750% | 1/01/40 | $ | 1,500 | $ | 1,544,700 | |||||
First Tier, Rfdg., Ser. C | A2 | 5.250 | 1/01/44 | 2,500 | 2,484,150 | |||||||
First Tier, Ser. A | A2 | 6.250 | 1/01/39 | 1,500 | 1,604,940 | |||||||
Second Tier, Rfdg., Ser. F | A3 | 5.750 | 1/01/38 | 2,500 | 2,537,600 | |||||||
Port Houston Auth. Rev., Tex. Harris Cnty., G.O., Rfdg., Ser. C | AAA(d) | 5.000 | 10/01/38 | 2,500 | 2,602,375 | |||||||
Sabine River Auth. Poll Ctl. Rev., TXU Energy Co. LLC Proj., | ||||||||||||
Ser. B | Caa3 | 6.150 | 8/01/22 | 1,000 | 626,530 | |||||||
San Antonio Elec. & Gas Sys., | Aa1 | 5.000 | 2/01/29 | 1,695 | 1,812,735 | |||||||
Ser. A | Aa1 | 5.000 | 2/01/21 | 5,000 | 5,484,549 | |||||||
Texas St. Pub. Fin. Auth. Charter Sch. Fin. Corp. Rev., | NR | 5.000 | 8/15/30 | 1,000 | 861,890 | |||||||
Texas St. Pub. Fin. Auth. Rev., Southern Univ. Fin. Sys., NATL | Baa1 | 5.500 | 11/01/18 | 2,240 | 2,144,419 | |||||||
Texas St. Vets. Hsg. Assistance Proj. Fdg., Ser. II-A, G.O. | AA+(d) | 5.250 | 12/01/23 | 2,500 | 2,891,025 | |||||||
51,415,959 | ||||||||||||
Utah 0.8% | ||||||||||||
Intermountain Power Agcy., Utah Pwr., Supply Rev., A.M.B.A.C. | A1 | 5.000 | 7/01/17 | 5,000 | 5,660,100 | |||||||
Riverton Hosp. Rev., I.H.C. Health Svcs. Inc. | Aa1 | 5.000 | 8/15/41 | 1,500 | 1,506,720 | |||||||
7,166,820 | ||||||||||||
Vermont 0.2% | ||||||||||||
Vermont Edl. & Health Bldgs., Middlebury College Proj., Rfdg. | Aa2 | 5.000 | 11/01/38 | 2,000 | 2,082,440 | |||||||
Virgin Islands 0.2% | ||||||||||||
U.S. Virgin Islands Pub. Fin. Auth., Sr. Lien Matching Fund Loan, Note A | Baa2 | 5.250 | 10/01/21 | 1,500 | 1,525,500 |
See Notes to Financial Statements.
Prudential National Muni Fund, Inc. | 27 |
Portfolio of Investments
as of February 28, 2010 (Unaudited) continued
Description (a) | Moody’s Ratings+* | Interest Rate | Maturity Date | Principal Amount (000) | Value (Note 1) | |||||||
Virginia 1.5% | ||||||||||||
Gloucester Cnty. Ind. Dev., Auth. Sld. Wste. Disp. Rev., Wste. Mgmt. Services, Ser. A, A.M.T. (Mandatory Put Date 5/01/14) | BBB(d) | 5.125% | 9/01/38 | $ | 2,300 | $ | 2,462,564 | |||||
Richmond Met. Auth. Expy. Rev., Rfdg., NATL | A(d) | 5.250 | 7/15/17 | 5,775 | 6,466,614 | |||||||
Small Business Funding Auth., Healthcare Facs. Rev., Sentara Healthcare, Rfdg. | Aa2 | 5.000 | 11/01/40 | 1,500 | 1,511,805 | |||||||
Sussex Cnty. Ind. Dev. Auth. Sld. Wste. Disp. Rev., Atlantic Wste., Ser. A, A.M.T. (Mandatory Put Date 5/01/14) | BBB(d) | 5.125 | 6/01/28 | 1,400 | 1,498,952 | |||||||
Tobacco Settlement Fin. Corp. Rev., Asset Bkd. (Pre-refunded Date 6/01/15)(b) | Aaa | 5.625 | 6/01/37 | 1,000 | 1,184,240 | |||||||
13,124,175 | ||||||||||||
Washington 2.5% | ||||||||||||
Clark Cnty. Wash. Sch. Dist. No. 114 Evergreen, Assured Gty., G.O. (Pre-refunded Date 6/01/12)(b) | Aa1 | 5.250 | 12/01/18 | 3,800 | 4,182,469 | |||||||
FYI Properties Lease Rev., Washington St. Dist. Proj. | AA(d) | 5.500 | 6/01/39 | 1,000 | 1,052,540 | |||||||
Port Seattle Wash. Rev., Intermediate Lien, Rfdg., X.L.C.A. | Aa3 | 5.000 | 2/01/28 | 3,000 | 3,044,459 | |||||||
Snohomish Cnty., | Aa3 | 5.375 | 12/01/19 | 220 | 237,915 | |||||||
Unrefunded Bal. Ltd. Tax, G.O., NATL | Aa3 | 5.375 | 12/01/19 | 1,780 | 1,846,608 | |||||||
Tobacco Settlement Auth. Rev., Asset Bkd. | Baa3 | 6.500 | 6/01/26 | 1,700 | 1,729,682 | |||||||
Washington St. Economic Dev. Fin. Auth. Lease Rev., Biomedical Resh. Pptys. II, | ||||||||||||
NATL | Aa2 | 5.000 | 6/01/21 | 2,665 | 2,872,124 | |||||||
NATL | Aa2 | 5.000 | 6/01/22 | 2,570 | 2,752,470 |
See Notes to Financial Statements.
28 | Visit our website at www.prudentialfunds.com |
Description (a) | Moody’s Ratings+* | Interest Rate | Maturity Date | Principal Amount (000) | Value (Note 1) | |||||||
Washington (cont’d.) | ||||||||||||
Washington St. Health Care Facs. Auth. Rev., | Aa2 | 5.000% | 10/01/36 | $ | 85 | $ | 99,996 | |||||
Seattle Childrens Hosp. | Aa3 | 5.625 | 10/01/38 | 1,250 | 1,296,363 | |||||||
Washington St. Hsg. Fin. Commn., Single Fam. Proj., Ser. 2A, A.M.T. | Aaa | 5.375 | 12/01/18 | 2,060 | 2,064,944 | |||||||
21,179,570 | ||||||||||||
West Virginia 0.4% | ||||||||||||
West Virginia St. Hosp. Fin. Auth. Hosp. Rev., Rfdg. & Impt. Utd. Health Sys., Ser. C | A2 | 5.500 | 6/01/39 | 500 | 497,075 | |||||||
West Virginia St. Hosp. Fin. Auth., Oak Hill Hosp. Rev., Ser. B (Pre-refunded Date 9/01/10)(b) | A2 | 6.750 | 9/01/30 | 2,000 | 2,085,860 | |||||||
West Virginia St. Wtr. Dev. Auth., Loan Proj. III, Ser. B, A.M.B.A.C., A.M.T. | A-(d) | 5.875 | 7/01/20 | 1,015 | 1,029,768 | |||||||
3,612,703 | ||||||||||||
Wisconsin 0.5% | ||||||||||||
Wisconsin St. Gen. Rev., Ser. A, St. Approp. | A1 | 5.750 | 5/01/33 | 2,000 | 2,158,080 | |||||||
Wisconsin St. Health & Edl. Facs. Auth. Rev., Marshfield Clinic, Ser. B | BBB+(d) | 6.000 | 2/15/25 | 2,000 | 2,014,600 | |||||||
4,172,680 | ||||||||||||
Wyoming 0.1% | ||||||||||||
Campbell Cnty. Solid Wst. Facs. Rev., Basin Elec. Pwr. Coop., Ser. A | A1 | 5.750 | 7/15/39 | 500 | 528,555 | |||||||
Total long-term investments | 843,902,703 | |||||||||||
See Notes to Financial Statements.
Prudential National Muni Fund, Inc. | 29 |
Portfolio of Investments
as of February 28, 2010 (Unaudited) continued
Description (a) | Moody’s Ratings+* | Interest Rate | Maturity Date | Principal Amount (000) | Value (Note 1) | |||||||
SHORT-TERM INVESTMENTS 1.3% | ||||||||||||
California 1.2% | ||||||||||||
California St. Dept. Water Res. Pwr. Supply Rev., Var. Sub. Ser. F-4, F.R.D.D.(g)(j) | VMIG1 | 0.110% | 3/01/10 | $ | 300 | $ | 300,000 | |||||
Sacramento Cnty. Santn. Dist. Fin. Auth. Rev., Sub. Lien Santn. Dist., Ser. D, Rfdg., F.R.D.D.(g)(j) | VMIG1 | 0.150 | 3/01/10 | 10,300 | 10,300,000 | |||||||
10,600,000 | ||||||||||||
Texas 0.1% | ||||||||||||
Dallas Performing Arts, Var. Dallas Ctr. Fndtn. Proj., Ser. A, F.R.D.D.(g)(j) | VMIG1 | 0.160 | 3/01/10 | 500 | 500,000 | |||||||
Total short-term investments | 11,100,000 | |||||||||||
Total Investments(k) 99.8% | 855,002,703 | |||||||||||
Other assets in excess of liabilities(l) 0.2% | 1,343,084 | |||||||||||
Net Assets 100.0% | $ | 856,345,787 | ||||||||||
(a) | The following abbreviations are used in portfolio descriptions: |
A.C.A.—American Capital Access Corporation
A.M.B.A.C.—American Municipal Bond Assurance Corporation
A.M.T.—Alternative Minimum Tax
B.H.A.C.—Berkshire Hathaway Assurance Corporation
C.A.B.S.—Capital Appreciation Bonds
CONNIE LEE—College Construction Loan Insurance Association
E.T.M.—Escrowed to Maturity
F.H.A.—Federal Housing Administration
F.H.L.M.C.—Federal Home Loan Mortgage Corporation
F.G.I.C.—Financial Guaranty Insurance Company
F.N.M.A.—Federal National Mortgage Association
F.R.D.D.—Floating Rate (Daily) Demand Note
G.N.M.A.—Government National Mortgage Association
G.O.—General Obligation
I.B.C. — Insured Bond Certificates
NATL.—National Public Finance Guarantee Corp.
See Notes to Financial Statements.
30 | Visit our website at www.prudentialfunds.com |
NR —Not Rated by Moody’s or Standard and Poor’s ratings
T.C.R.S.—Transferable Custodial Receipts
U.C.L.A.—University of California, Los Angeles
X.L.C.A.—XL Capital Assurance
+ | The ratings reflected are as of February 28, 2010. Ratings of certain bonds may have changed subsequent to that date. |
* | The Fund’s current Statement of Additional Information contains a description of Moody’s and Standard & Poor’s ratings. |
(b) | All or partial escrowed to maturity and/or pre-refunded securities are secured by escrowed cash and/or U.S. guaranteed obligations. |
(c) | Represents issuer in default of interest payments; non-income producing security. |
(d) | Standard & Poor’s rating. |
(e) | All or portion of security segregated as collateral for financial futures contracts. |
(f) | Indicates a security that has been deemed illiquid. |
(g) | For purposes of amortized cost valuation, the maturity date of floating Rate Demand Notes is considered to be the later of the next date on which the security can be redeemed at par, or the next date on which the rate of interest is adjusted. |
(h) | Indicates a security restricted to resale. The aggregate original cost of such securities was $2,780,478. The aggregate value of $119,917 is approximately 0.0% of the net assets. |
(i) | Represents a zero coupon or step bond. Rate shown reflects the effective yield on February 28, 2010. |
(j) | Floating Rate Security. The interest rate shown reflects the rate in effect at February 28, 2010. |
(k) | As of February 28, 2010, one security representing $7 and 0.0% of net assets was fair valued in accordance with the policies adopted by the Board of Directors. |
(l) | Other assets in excess of liabilities include net unrealized depreciation on financial futures contracts as follows: |
Open futures contracts outstanding at February 28, 2010:
Number of Contracts | Type | Expiration Date | Value at Trade Date | Value at February 28, 2010 | Unrealized Depreciation | |||||||||
Short Positions: | ||||||||||||||
168 | U.S. Treasury 10 Yr Notes | Jun. 2010 | $ | 19,526,056 | $ | 19,737,375 | $ | (211,319 | ) | |||||
166 | U.S. Long Bond | Jun. 2010 | 19,324,422 | 19,536,125 | (211,703 | ) | ||||||||
$ | (423,022 | ) | ||||||||||||
Various inputs are used in determining the value of the Fund’s investments. These inputs are summarized in the three broad levels listed below.
Level 1—quoted prices in active markets for identical securities
Level 2—other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.)
See Notes to Financial Statements.
Prudential National Muni Fund, Inc. | 31 |
Portfolio of Investments
as of February 28, 2010 (Unaudited) continued
Level 3—significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments)
The following is a summary of the inputs used as of February 28, 2010 in valuing the Fund’s assets carried at fair value:
Level 1 | Level 2 | Level 3 | ||||||||
Investments in Securities | ||||||||||
Municipal Bonds | $ | — | $ | 855,002,696 | $ | 7 | ||||
Other Financial Instruments* | (423,022 | ) | — | — | ||||||
Total | $ | (423,022 | ) | $ | 855,002,696 | $ | 7 | |||
* | Other financial instruments are derivative instruments not reflected in the Portfolio of Investments, such as futures, forwards and swap contracts, which are valued at the unrealised appreciation/depreciation on the instrument. |
The following is a reconciliation of assets in which significant unobservable inputs (Level 3) were used in determining fair value:
Municipal Bond | |||
Balance as of 8/31/09 | $ | 7 | |
Realized gain (loss) | — | ||
Change in unrealized appreciation (depreciation) | — | ||
Net purchases (sales) | — | ||
Transfers in and/or out of Level 3 | — | ||
Balance as of 2/28/10 | $ | 7 | |
The industry classification of portfolio holdings and other assets in excess of liabilities shown as a percentage of net assets as of February 28, 2010 were as follows:
Transportation | 16.9 | % | |
Healthcare | 13.5 | ||
General Obligation | 11.7 | ||
Power | 9.5 | ||
Education | 8.6 | ||
Pre-Refunded | 8.0 | ||
Special Tax/Assessment District | 6.5 | ||
Water & Sewer | 5.0 | ||
Other | 4.5 | ||
Lease Backed Certificate of Participation | 3.8 | ||
Corporate Backed IDB & PCR | 3.7 |
See Notes to Financial Statements.
32 | Visit our website at www.prudentialfunds.com |
Industry (cont’d.) | |||
Pooled Financing | 2.3 | % | |
Tobacco | 1.9 | ||
Short-Term Investments | 1.3 | ||
Solid Waste/Resource Recovery | 1.3 | ||
Housing | 1.0 | ||
Tobacco Appropriated | 0.3 | ||
99.8 | |||
Other assets in excess of liabilities | 0.2 | ||
Net Assets | 100.0 | % | |
Industry classification is subject to change.
The Fund invested in derivative instruments during the reporting period. The primary types of risk associated with these derivative instruments are commodity risk, credit risk, equity risk, foreign exchange risk and interest rate risk. The effect of such derivative instruments on the Fund’s financial position and financial performance as reflected in the Statement of Assets and Liabilities and Statement of Operations is presented in the summary below.
Fair values of derivative instruments as of February 28, 2010 as presented in the Statement of Assets and Liabilities:
Derivatives not designated as | Asset Derivatives | Liability Derivatives | ||||||||
Balance Sheet Location | Fair Value | Balance | Fair Value | |||||||
Interest rate contracts | — | — | Due to broker—variation margin | $ | 423,022 | * |
* | Includes cumulative appreciation/depreciation on futures contracts as reported in Portfolio of Investments. Only unsettled variation margin receivable (payable) is reported within the Statement of Assets and Liabilities. |
The effects of derivative instruments on the Statement of Operations for the six months ended February 28, 2010 are as follows:
Amount of Realized Gain or (Loss) on Derivatives Recognized in Income | ||||
Derivatives not designated as | Futures | |||
Interest rate contracts | $ | (541,154 | ) |
See Notes to Financial Statements.
Prudential National Muni Fund, Inc. | 33 |
Portfolio of Investments
as of February 28, 2010 (Unaudited) continued
Change in Unrealized Appreciation or (Depreciation) on Derivatives Recognized in Income | ||||
Derivatives not designated as | Futures | |||
Interest rate contracts | $ | (144,675 | ) |
For the six months ended February 28, 2010, the Fund’s average value at trade date for short positions on futures contracts was $33,755,777.
See Notes to Financial Statements.
34 | Visit our website at www.prudentialfunds.com |
Financial Statements
FEBRUARY 28, 2010 | SEMIANNUAL REPORT |
Prudential National Muni Fund, Inc.
Statement of Assets and Liabilities
as of February 28, 2010 (Unaudited)
Assets | ||||
Unaffiliated investments at value (cost $832,857,920) | $ | 855,002,703 | ||
Interest receivable | 10,186,280 | |||
Receivable for investments sold | 3,010,666 | |||
Receivable for Fund shares sold | 1,181,204 | |||
Prepaid expenses | 9,704 | |||
Total assets | 869,390,557 | |||
Liabilities | ||||
Payable for investments purchased | 10,559,095 | |||
Payable for Fund shares reacquired | 1,181,850 | |||
Management fee payable | 308,933 | |||
Dividends payable | 286,663 | |||
Accrued expenses | 227,325 | |||
Due to broker—variation margin | 182,250 | |||
Distribution fee payable | 176,842 | |||
Deferred directors’ fees | 71,912 | |||
Affiliated transfer agent fee payable | 48,979 | |||
Payable to custodian | 921 | |||
Total liabilities | 13,044,770 | |||
Net Assets | $ | 856,345,787 | ||
Net assets were comprised of: | ||||
Common stock, at par | $ | 582,904 | ||
Paid-in capital in excess of par | 834,672,764 | |||
835,255,668 | ||||
Undistributed net investment income | 498,976 | |||
Accumulated net realized loss on investment and financial futures transactions | (1,130,618 | ) | ||
Net unrealized appreciation on investments and financial futures | 21,721,761 | |||
Net assets, February 28, 2010 | $ | 856,345,787 | ||
See Notes to Financial Statements.
36 | Visit our website at www.prudentialfunds.com |
Class A | |||
Net asset value and redemption price per share | $ | 14.69 | |
Maximum sales charge (4% of offering price) | .61 | ||
Maximum offering price to public | $ | 15.30 | |
Class B | |||
Net asset value, offering price and redemption price per share | $ | 14.73 | |
Class C | |||
Net asset value, offering price and redemption price per share | $ | 14.73 | |
Class Z | |||
Net asset value, offering price and redemption price per share | $ | 14.68 | |
See Notes to Financial Statements.
Prudential National Muni Fund, Inc. | 37 |
Statement of Operations
Six Months Ended February 28, 2010 (Unaudited)
Net Investment Income | ||||
Income | ||||
Interest | $ | 21,043,321 | ||
Expenses | ||||
Management fee | 2,000,747 | |||
Distribution fee—Class A | 972,176 | |||
Distribution fee—Class B | 91,012 | |||
Distribution fee—Class C | 81,013 | |||
Transfer agent’s fee and expenses (including affiliated expense of $94,300) | 233,000 | |||
Custodian’s fees and expenses | 55,000 | |||
Reports to shareholders | 29,000 | |||
Registration fees | 27,000 | |||
Directors’ fees | 23,000 | |||
Legal fees and expenses | 16,000 | |||
Audit fee | 15,000 | |||
Insurance expenses | 10,000 | |||
Miscellaneous | 9,094 | |||
Total expenses | 3,562,042 | |||
Less: Custodian fee credit (Note 1) | (75 | ) | ||
Net expenses | 3,561,967 | |||
Net investment income | 17,481,354 | |||
Realized And Unrealized Gain (Loss) On Investments | ||||
Net realized gain (loss) on: | ||||
Investment transactions | 2,559,784 | |||
Financial futures transactions | (541,154 | ) | ||
2,018,630 | ||||
Net change in unrealized appreciation (depreciation) on: | ||||
Investments | 13,761,363 | |||
Financial futures contracts | (144,675 | ) | ||
13,616,688 | ||||
Net gain on investments | 15,635,318 | |||
Net Increase In Net Assets Resulting From Operations | $ | 33,116,672 | ||
See Notes to Financial Statements.
38 | Visit our website at www.prudentialfunds.com |
Statement of Changes in Net Assets
(Unaudited)
Six Months Ended February 28, 2010 | Year Ended August 31, 2009 | |||||||
Increase (Decrease) In Net Assets | ||||||||
Operations | ||||||||
Net investment income | $ | 17,481,354 | $ | 31,026,819 | ||||
Net realized gain (loss) on investment and financial futures transactions | 2,018,630 | (3,168,185 | ) | |||||
Net change in unrealized appreciation (depreciation) on investments and financial futures | 13,616,688 | 7,439,542 | ||||||
Net increase in net assets resulting from operations | 33,116,672 | 35,298,176 | ||||||
Dividends (Note 1) | ||||||||
Dividends from net investment income | ||||||||
Class A | (16,190,807 | ) | (28,415,634 | ) | ||||
Class B | (712,508 | ) | (1,313,059 | ) | ||||
Class C | (396,100 | ) | (532,851 | ) | ||||
Class Z | (267,268 | ) | (335,830 | ) | ||||
(17,566,683 | ) | (30,597,374 | ) | |||||
Fund share transactions (Net of share conversions) (Note 6) | ||||||||
Net proceeds from shares sold | 25,211,811 | 31,873,358 | ||||||
Net asset value of shares issued in connection with merger | — | 177,297,034 | ||||||
Net asset value of shares issued in reinvestment of dividends and distributions | 13,557,909 | 19,634,841 | ||||||
Cost of shares reacquired | (45,115,632 | ) | (79,789,843 | ) | ||||
Increase (decrease) in net assets from Fund share transactions | (6,345,912 | ) | 149,015,390 | |||||
Total increase | 9,204,077 | 153,716,192 | ||||||
Net Assets | ||||||||
Beginning of period | 847,141,710 | 693,425,518 | ||||||
End of period(a) | $ | 856,345,787 | $ | 847,141,710 | ||||
(a) Includes undistributed net investment income of: | $ | 498,976 | $ | 584,305 | ||||
See Notes to Financial Statements.
Prudential National Muni Fund, Inc. | 39 |
Notes to Financial Statements
(Unaudited)
Prudential National Muni Fund, Inc. (formerly Dryden National Municipals, Fund, Inc.) (the “Fund”), is registered under the Investment Company Act of 1940, as amended, as a diversified, open-end management investment company. The investment objective of the Fund is to seek a high level of current income exempt from federal income taxes by investing substantially all of its total assets in carefully selected long-term municipal bonds of medium quality. The ability of the issuers of debt securities held by the Fund to meet their obligations may be affected by economic or political developments in a specific state, industry or region.
Note 1. Accounting Policies
The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements.
Securities Valuations: The Fund values municipal securities (including commitments to purchase such securities on a “when-issued” basis) as of the close of trading on the New York Stock Exchange, on the basis of prices provided by a pricing service which uses information with respect to transactions in comparable securities and various relationships between securities in determining values. Securities listed on a securities exchange (other than options on securities and indices) are valued at the last sale price on such exchange on the day of valuation or, if there was no sale on such day, at the mean between the last reported bid and asked prices, or at the last bid price on such day in the absence of an asked price. Securities that are actively traded in the over-the-counter market, including listed securities for which the primary market is believed by Prudential Investments LLC (“PI” or “Manager”) in consultation with the subadvisor, to be over-the-counter, are valued at market value using prices provided, by an independent pricing agent or principal market maker. Futures contracts and options thereon traded on an exchange or board of trade are valued at the last sale price at the close of trading on such exchange or board of trade or, if there was no sale on the applicable exchange or board of trade on such day, at the mean between the most recently quoted prices on such exchange or board of trade or at the last bid price in the absence of an asked price. Securities for which reliable market quotations are not readily available or for which the pricing service does not provide a valuation methodology, or does not present fair value, are valued at fair value in accordance with Board of Directors’ approved fair valuation procedures. When determining the fair valuation of securities, some of the factors influencing the valuation include, the nature of any restrictions on disposition of the securities; assessment of the general
40 | Visit our website at www.prudentialfunds.com |
liquidity of the securities; the issuer’s financial condition and the markets in which it does business; the cost of the investment; the size of the holding and capitalization of the issuer; the prices of any recent transactions or bids/offers for such securities or any comparable securities; any available analyst media or other reports or information deemed reliable by the investment adviser regarding the issuer or the markets or industry in which it operates. Using fair value to price securities may result in a value that is different from a security’s most recent closing price and from the price used by other mutual funds to calculate their net asset values.
Investments in mutual funds are valued at their net asset value as of the close of the New York Stock Exchange on the date of valuation.
Short-term debt securities of sufficient credit quality which mature in sixty days or less are valued at amortized cost, which approximates fair value. The amortized cost method involves valuing a security at its cost on the date of purchase and thereafter assuming a constant amortization to maturity of the difference between the principal amount due at maturity and cost. Short-term debt securities which mature in more than sixty days are valued at current market quotations.
Floating-Rate Notes Issued in Conjunction with Securities Held: The Fund invests in inverse floating rate securities (“inverse floaters”) that pay interest at a rate that varies inversely with short-term interest rates. Certain of these securities may be leveraged, whereby the interest rate varies inversely at a multiple of the change in short-term rates. As interest rates rise, inverse floaters produce less current income. The price of such securities is more volatile than comparable fixed rate securities.
When the Fund enters into agreements to create inverse floaters and floater note securities (also known as Tender Option Bond Transactions), the Fund transfers a fixed rate bond to a broker for cash. At the same time the Fund buys (receives) a residual interest in a trust (the “trust”) set up by the broker, often referred to as an inverse floating rate obligation (inverse floaters). Generally, the broker deposits a fixed rate bond (the “fixed rate bond”) into the trust with the same CUSIP number as the fixed rate bond sold to the broker by the Fund. The “trust” also issues floating rate notes (“floating rate notes”), which are sold to third parties. The floating rate notes have interest rates that reset weekly. The inverse floater held by the Fund gives the Fund the right (1) to cause the holders of the floating rate notes to tender their notes at par, and (2) to have the broker transfer the fixed rate bond held by the trust to the Fund thereby collapsing the trust. The Fund accounts for the transaction described above as funded leverage by including the fixed rate bond in its Portfolio of Investments, and accounts for the floating rate notes as a liability under the caption “payable for floating rate notes issued” in the Fund’s “Statement of Assets and
Prudential National Muni Fund, Inc. | 41 |
Notes to Financial Statements
(Unaudited) continued
Liabilities.” Interest expense related to the Fund’s liability in connection with the floating rate notes held by third parties is recorded as incurred. The interest expense is under the caption “interest expenses and fees related to inverse floaters” in the Fund’s “Statement of Operations” and is also included in the Fund’s expense ratio. For the six months ended February 28, 2010 the Fund did not enter into any Tender Option Bond Transactions.
The Fund may also invest in inverse floaters without transferring a fixed rate bond into a trust, which is not accounted for as funded leverage. The interest rates on these securities have an inverse relationship to the interest rate of other securities or the value of an index. Changes in interest rates on the other security or index inversely affect the rate paid on the inverse floater, and the inverse floater’s price will be more volatile than that of a fixed-rate bond. Additionally, some of these securities contain a “leverage factor” whereby the interest rate moves inversely by a “factor” to the benchmark rate. Certain interest rate movements and other market factors can substantially affect the liquidity of inverse floating rate notes.
The Fund’s investment policies and restrictions permit investments in inverse floating rate securities. Inverse floaters held by the Fund are securities exempt from registration under Rule 144A of the Securities Act of 1933.
Financial Futures Contracts: A financial futures contract is an agreement to purchase (long) or sell (short) an agreed amount of securities at a set price for delivery on a future date. Upon entering into a financial futures contract, the Fund is required to pledge to the broker an amount of cash and/or other assets equal to a certain percentage of the contract amount. This amount is known as the “initial margin.” Subsequent payments, known as “variation margin,” are made or received by the Fund each day, depending on the daily fluctuations in the value of the underlying security. Such variation margin is recorded for financial statement purposes on a daily basis as unrealized gain or loss. When the contract expires or is closed, the gain or loss is realized and is presented in the statement of operations as net realized gain (loss) on financial futures contracts.
The Fund invests in financial futures contracts in order to hedge existing portfolio securities, or securities the Fund intends to purchase, against fluctuations in value caused by changes in prevailing interest rates, and manage yield curve and duration. The Fund may not achieve the anticipated benefits of the financial futures contracts
42 | Visit our website at www.prudentialfunds.com |
and may realize a loss. The use of futures transactions involves the risk of imperfect correlation in movements in the price of futures contracts, interest rates and the underlying hedged assets.
Financial future contracts involve elements of both market and credit risk in excess of the amounts reflected on the Statement of Assets and Liabilities.
With exchange-traded futures contracts, there is minimal counterparty credit risk to the Fund since the exchanges’ clearinghouse acts as counterparty to all exchange traded futures and guarantees the futures contracts against default.
Restricted Securities: The Fund may hold up to 15% of its net assets in illiquid securities, including those which are restricted as to disposition under securities law (“restricted securities”). Restricted securities held by the Fund at the end of the period may include registration rights under which the Fund may demand registration by the issuer, of which the Fund may bear the cost of such registration. Restricted securities are valued pursuant to the valuation procedures noted above.
Securities Transactions and Net Investment Income: Securities transactions are recorded on the trade date. Realized gains or losses on sales of portfolio securities are calculated on the identified cost basis. Interest income, including amortization of premium and accretion of discount on debt securities, as required, is recorded on the accrual basis. Expenses are recorded on the accrual basis which may require the use of certain estimates by management. The Fund amortizes premiums and accretes discounts on purchases of debt securities as adjustments to interest income. Net investment income or loss (other than distribution fees, which are charged directly to respective class) and unrealized and realized gains or losses, are allocated daily to each class of shares based upon the relative proportion of net assets of each class at the beginning of the day.
Taxes: For federal income tax purposes, it is the Fund’s policy to continue to meet the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its taxable net income and capital gains, if any, to its shareholders. Therefore, no federal income tax provision is required.
Dividends and Distributions: The Fund declares daily dividends from net investment income. Payment of dividends is made monthly. Distributions of net realized capital gains, if any, are made annually. Dividends and distributions to shareholders, which are determined in accordance with federal income tax regulations and which may differ from generally accepted accounting principles, are recorded on the ex-dividend date. Permanent book/tax differences relating to income and gains are reclassified
Prudential National Muni Fund, Inc. | 43 |
Notes to Financial Statements
(Unaudited) continued
amongst undistributed net investment income, accumulated net realized gain or loss and paid-in capital in excess of par, as appropriate.
Custody Fee Credits: The Fund has an arrangement with its custodian bank, whereby uninvested monies earn credits which reduce the fees charged by the custodian. Such custody fee credits are presented as a reduction of gross expenses in the accompanying Statement of Operations.
Estimates: The preparation of the financial statements requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements. Actual results could differ from those estimates.
Note 2. Agreements
The Fund has a management agreement with Prudential Investments LLC (“PI”). Pursuant to this agreement, PI has responsibility for all investment advisory services and supervises the subadvisor’s performance of such services. PI has entered into a subadvisory agreement with Prudential Investment Management, Inc. (“PIM”). The subadvisory agreement provides that PIM will furnish investment advisory services in connection with the management of the Fund. In connection therewith, PIM is obligated to keep certain books and records of the Fund. PI pays for the services of PIM, the cost of compensation of officers of the Fund, occupancy and certain clerical and bookkeeping costs of the Fund. The Fund bears all other costs and expenses.
The management fee paid to PI is computed daily and payable monthly at an annual rate of 0.50% of the Fund’s average daily net assets up to and including $250 million, 0.475% of the next $250 million, 0.45% of the next $500 million, 0.425% of the next $250 million, 0.40% of the next $250 million and 0.375% of the Fund’s average daily net assets in excess of $1.5 billion. The effective management fee rate was 0.47% of the Fund’s average daily net assets for the six months ended February 28, 2010.
The Fund has a distribution agreement with Prudential Investment Management Services LLC (“PIMS”), which acts as the distributor of the Class A, B, C and Z shares of the Fund. The Fund compensates PIMS for distributing and servicing the Fund’s Class A, Class B and Class C shares, pursuant to plans of distribution (the “Class A, B and C Plans”), regardless of expenses actually incurred by it. The distribution fees are accrued daily and payable monthly. No distribution or service fees are paid to PIMS as distributor of the Class Z shares of the Fund.
44 | Visit our website at www.prudentialfunds.com |
Pursuant to the Class A, B and C Plans, the Fund compensates PIMS for distribution-related activities at an annual rate of up to 0.30%, 0.50% and 1%, of the average daily net assets of the Class A, B and C shares, respectively. For the six months ended February 28, 2010, PIMS contractually agreed to limit such fees to 0.25% and 0.75% of the average daily net assets of the Class A and Class C shares, respectively.
PIMS has advised the Fund that it received $103,528 in front-end sales charges resulting from sales of Class A shares, during for the six months ended February 28, 2010. From these fees, PIMS paid a substantial portion of such sales charges to dealers, which in turn paid commissions to salespersons and incurred other distribution costs.
PlMS has advised the Fund that for the six months ended February 28, 2010, it received $2,040, $7,512 and $719 in contingent deferred sales charges imposed upon certain redemptions by Class A, Class B and Class C shareholders, respectively.
PI, PIM and PIMS are indirect, wholly owned subsidiaries of Prudential Financial, Inc. (“Prudential”).
The Fund, along with other affiliated registered investment companies (the “Funds”), is a party to a Syndicated Credit Agreement (“SCA”) with two banks. The SCA provides for a commitment of $500 million. Interest on any borrowings under the SCA is incurred at contracted market rates and a commitment fee for the unused amount is accrued daily and paid quarterly. Effective October 22, 2009, the Funds renewed the SCA with the banks. The commitment under the renewed SCA continues to be $500 million. The Funds pay a commitment fee of 0.15% of the unused portion of the renewed SCA. The expiration date of the renewed SCA will be October 20, 2010. For the period from October 24, 2008 through October 21, 2009, the Funds paid a commitment fee of 0.13% of the unused portion of the agreement. The purpose of the SCA is to provide an alternative source of temporary funding for capital share redemptions. The Fund did not borrow any amounts pursuant to the SCA during the six months ended February 28, 2010.
Note 3. Other Transactions with Affiliates
Prudential Mutual Fund Services LLC (“PMFS”), an affiliate of PI and an indirect wholly-owned subsidiary of Prudential, serves as the Fund’s transfer agent. The transfer agent fees and expenses in the Statement of Operations include certain out-of-pocket expenses paid to non-affiliates, where applicable.
Prudential National Muni Fund, Inc. | 45 |
Notes to Financial Statements
(Unaudited) continued
The Fund pays networking fees to affiliated and unaffiliated broker/dealers, including fees relating to the services of First Clearing, LLC (“First Clearing”) and Wells Fargo Advisors, LLC (“Wells Fargo”), an affiliate of PI through December 31, 2009. These networking fees are payments made to broker/dealers that clear mutual fund transactions through a national clearing system. For the six months ended February 28, 2010, the Fund incurred approximately $67,700 in total networking fees, of which approximately $3,500 and $20,600 was paid to First Clearing and Wells Fargo, respectively, through December 31, 2009. These amounts are included in transfer agent’s fee and expenses on the Statement of Operations.
Note 4. Portfolio Securities
Purchases and sales of investment securities, other than short-term investments, for the six months ended February 28, 2010, aggregated $123,903,059 and $275,376,093, respectively.
Note 5. Tax Information
The United States federal income tax basis of the Fund’s investments and the net unrealized appreciation as of February 28, 2010 were as follows:
Tax Basis of | Appreciation | Depreciation | Net Unrealized | |||
$832,201,876 | $41,068,739 | $(18,267,912) | $22,800,827 |
The differences between book and tax basis are primarily attributable to differences in the treatment of accreting market discount and premium amortization and municipal tender option bond transactions for book and tax purposes.
As of August 31, 2009, the Fund had a capital loss carryforward for tax purposes of approximately $260,000 of which $225,000 expires in 2016 and $35,000 expires in 2017. No capital gains distributions are expected to be paid to shareholders until net gains have been realized in excess of such carryforward. It is uncertain whether the Fund will be able to realize the full benefit prior to the expiration date.
Management has analyzed the Fund’s tax positions taken on federal income tax returns for all open tax years and has concluded that as of February 28, 2010, no provision for income tax would be required in the Fund’s financial statements. The Fund’s federal and state income and federal excise tax returns for tax years for which
46 | Visit our website at www.prudentialfunds.com |
the applicable statutes of limitations have not expired are subject to examination by the Internal Revenue Service and state departments of revenue.
Note 6. Capital
The Fund offers Class A, Class B, Class C and Class Z shares. Class A shares are subject to a maximum front-end sales charge of 4%. All investors who purchase Class A shares in an amount of $1 million or more are not subject to a front-end sales charge but are subject to a contingent deferred sales charge (CDSC) of 1%, if they sell these shares within 12 months of purchase, including investors who purchase their shares through broker-dealers affiliated with Prudential. Class B shares are sold with a CDSC which declines from 5% to zero depending upon the period of time the shares are held. Class C shares are subject to a CDSC of 1% within 12 months from the date of purchase. Class B shares will automatically convert to Class A shares on a quarterly basis approximately seven years after purchase. A special exchange privilege is also available for shareholders who qualify to purchase Class A shares at net asset value. Class Z shares are not subject to any sales or redemption charge and are offered exclusively for sale to a limited group of investors.
There are 1 billion shares of common stock, $.01 par value per share, authorized and divided into four classes, designated Class A, Class B, Class C and Class Z common stock, each of which consists of 250 million authorized shares.
Transactions in shares of common stock were as follows:
Class A | Shares | Amount | |||||
Six months ended February 28, 2010: | |||||||
Shares sold | 950,007 | $ | 13,774,249 | ||||
Shares issued in reinvestment of dividends and distributions | 852,421 | 12,490,055 | |||||
Shares reacquired | (2,376,645 | ) | (34,781,021 | ) | |||
Net increase (decrease) in shares outstanding before conversion | (574,217 | ) | (8,516,717 | ) | |||
Shares issued upon conversion from Class B | 312,214 | 4,704,893 | |||||
Net increase (decrease) in shares outstanding | (262,003 | ) | $ | (3,811,824 | ) | ||
Year ended August 31, 2009: | |||||||
Shares sold | 1,336,571 | $ | 18,396,106 | ||||
Shares issued in connection with the merger | 10,727,172 | 150,073,130 | |||||
Shares issued in reinvestment of dividends and distributions | 1,311,538 | 18,167,050 | |||||
Shares reacquired | (5,100,066 | ) | (70,218,830 | ) | |||
Net increase (decrease) in shares outstanding before conversion | 8,275,215 | 116,417,456 | |||||
Shares issued upon conversion from Class B | 761,213 | 10,502,958 | |||||
Net increase (decrease) in shares outstanding | 9,036,428 | $ | 126,920,414 | ||||
Prudential National Muni Fund, Inc. | 47 |
Notes to Financial Statements
(Unaudited) continued
Class B | Shares | Amount | |||||
Six months ended February 28, 2010: | |||||||
Shares sold | 368,238 | $ | 5,402,590 | ||||
Shares issued in reinvestment of dividends and distributions | 39,370 | 578,452 | |||||
Shares reacquired | (342,336 | ) | (5,016,471 | ) | |||
Net increase (decrease) in shares outstanding before conversion | 65,272 | 964,571 | |||||
Shares reacquired upon conversion into Class A | (320,138 | ) | (4,704,893 | ) | |||
Net increase (decrease) in shares outstanding | (254,866 | ) | $ | (3,740,322 | ) | ||
Year ended August 31, 2009: | |||||||
Shares sold | 339,372 | $ | 4,739,695 | ||||
Shares issued in connection with the merger | 1,083,160 | 15,196,740 | |||||
Shares issued in reinvestment of dividends and distributions | 63,355 | 880,522 | |||||
Shares reacquired | (411,403 | ) | (5,689,809 | ) | |||
Net increase (decrease) in shares outstanding before conversion | 1,074,484 | 15,127,148 | |||||
Shares reacquired upon conversion into Class A | (758,459 | ) | (10,502,958 | ) | |||
Net increase (decrease) in shares outstanding | 316,025 | $ | 4,624,190 | ||||
Class C | |||||||
Six months ended February 28, 2010: | |||||||
Shares sold | 200,215 | $ | 2,941,036 | ||||
Shares issued in reinvestment of dividends and distributions | 19,610 | 288,000 | |||||
Shares reacquired | (81,540 | ) | (1,198,677 | ) | |||
Net increase (decrease) in shares outstanding | 138,285 | $ | 2,030,359 | ||||
Year ended August 31, 2009: | |||||||
Shares sold | 349,109 | $ | 4,851,424 | ||||
Shares issued in connection with the merger | 447,958 | 6,284,851 | |||||
Shares issued in reinvestment of dividends and distributions | 22,509 | 313,418 | |||||
Shares reacquired | (157,735 | ) | (2,188,078 | ) | |||
Net increase (decrease) in shares outstanding | 661,841 | $ | 9,261,615 | ||||
Class Z | |||||||
Six months ended February 28, 2010: | |||||||
Shares sold | 211,376 | $ | 3,093,936 | ||||
Shares issued in reinvestment of dividends and distributions | 13,741 | 201,402 | |||||
Shares reacquired | (283,410 | ) | (4,119,463 | ) | |||
Net increase (decrease) in shares outstanding | (58,293 | ) | $ | (824,125 | ) | ||
Year ended August 31, 2009: | |||||||
Shares sold | 279,247 | $ | 3,886,133 | ||||
Shares issued in connection with the merger | 410,752 | 5,742,313 | |||||
Shares issued in reinvestment of dividends and distributions | 19,661 | 273,851 | |||||
Shares reacquired | (121,905 | ) | (1,693,126 | ) | |||
Net increase (decrease) in shares outstanding | 587,755 | $ | 8,209,171 | ||||
48 | Visit our website at www.prudentialfunds.com |
Note 7. New Accounting Pronouncement
In January 2010, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2010-06 “Improving Disclosures about Fair Value Measurements”. ASU 2010-06 will require reporting entities to make new disclosures about amounts and reasons for significant transfers in and out of Level 1 and Level 2 fair value measurements and input and valuation techniques used to measure fair value for both recurring and nonrecurring fair value measurements that fall in either Level 2 or Level 3, and information on purchases, sales, issuances, and settlements in the roll forward of activity in Level 3 fair value measurements. The new and revised disclosures are effective for interim and annual reporting periods beginning after December 15, 2009 except for the disclosures about purchases, sales, issuances, and settlements in the roll forward of activity in Level 3 fair value measurements, which are effective for interim and annual reporting periods beginning after December 15, 2010. At this time, management is evaluating the implications of ASU No. 2010-06 and its impact on the financial statements has not been determined.
Note 8. Subsequent Events
Management has evaluated the impact of all subsequent events on the Fund and has determined that there were no subsequent events requiring recognition or disclosure in the financial statements.
Prudential National Muni Fund, Inc. | 49 |
Financial Highlights
(Unaudited)
Class A | ||||
Six Months Ended February 28, 2010 | ||||
Per Share Operating Performance: | ||||
Net Asset Value, Beginning Of Period | $ | 14.42 | ||
Income (loss) from investment operations | ||||
Net investment income | .30 | |||
Net realized and unrealized gain (loss) on investment and financial futures transactions | .27 | |||
Total from investment operations | .57 | |||
Less Dividends and Distributions | ||||
Dividends from net investment income | (.30 | ) | ||
Distributions from net realized gains | — | |||
Total dividends and distributions | (.30 | ) | ||
Net asset value, end of period | $ | 14.69 | ||
Total Return(b): | 3.99 | % | ||
Ratios/Supplemental Data: | ||||
Net assets, end of period (000) | $ | 784,665 | ||
Average net assets (000) | $ | 784,188 | ||
Ratios to average net assets: | ||||
Expenses, including distribution and service (12b-1) fees(c) | .82 | %(e) | ||
Expenses, excluding distribution and service (12b-1) fees | .57 | %(e) | ||
Net investment income | 4.14 | %(e) | ||
For Class A, B, C and Z shares: | ||||
Portfolio turnover rate | 15 | %(f)(g) |
(a) | For the eight-month period ended August 31, 2007. The Fund changed its fiscal year end from December 31 to August 31. |
(b) | Total return does not consider the effects of sales loads. Total investment return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions. Total investment returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods of less than one full year are not annualized. |
(c) | The distributor of the Fund has contractually agreed to limit its distribution and service (12b-1) fees to .25 of 1% of the average daily net assets of the Class A shares. |
(d) | The expense ratio reflects the interest expense and fees related to the liability for the floating rate notes issued in conjunction with the inverse floater securities. The total expense ratio excluding interest expense and fees is .82%, .83%, .83% and .87% and the expense ratio excluding 12b-1 and interest expense and fees is .57%, .58%, .58% and .62% for the year ended August 31, 2009, the year ended August 31, 2008, the eight-month period ended August 31, 2007 and the year ended December 31, 2006, respectively. |
(e) | Annualized. |
(f) | Not annualized. |
(g) | The portfolio turnover rate including variable rate demand notes was 24% for the six months ended February 28, 2010 and 61% for the year ended August 31, 2009. |
See Notes to Financial Statements.
50 | Visit our website at www.prudentialfunds.com |
Class A | ||||||||||||||||||||||
Year Ended August 31, | Eight-Month Period Ended August 31, 2007(a) | Year Ended December 31, | ||||||||||||||||||||
2009 | 2008 | 2006 | 2005 | 2004 | ||||||||||||||||||
$ | 14.41 | $ | 14.64 | $ | 15.12 | $ | 15.09 | $ | 15.32 | $ | 15.52 | |||||||||||
.60 | .60 | .40 | .59 | .60 | .59 | |||||||||||||||||
.01 | (.21 | ) | (.47 | ) | .10 | (.15 | ) | .02 | ||||||||||||||
.61 | .39 | (.07 | ) | .69 | .45 | .61 | ||||||||||||||||
(.60 | ) | (.60 | ) | (.40 | ) | (.59 | ) | (.60 | ) | (.59 | ) | |||||||||||
— | (.02 | ) | (.01 | ) | (.07 | ) | (.08 | ) | (.22 | ) | ||||||||||||
(.60 | ) | (.62 | ) | (.41 | ) | (.66 | ) | (.68 | ) | (.81 | ) | |||||||||||
$ | 14.42 | $ | 14.41 | $ | 14.64 | $ | 15.12 | $ | 15.09 | $ | 15.32 | |||||||||||
4.46 | % | 2.66 | % | (.47 | )% | 4.68 | % | 3.02 | % | 4.11 | % | |||||||||||
$ | 774,235 | $ | 643,186 | $ | 693,818 | $ | 769,525 | $ | 472,491 | $ | 508,667 | |||||||||||
$ | 658,247 | $ | 670,723 | $ | 730,108 | $ | 466,577 | $ | 492,151 | $ | 525,601 | |||||||||||
.84 | %(d) | .91 | %(d) | .96 | %(d)(e) | .97 | %(d) | .87 | % | .86 | % | |||||||||||
.59 | %(d) | .66 | %(d) | .71 | %(d)(e) | .72 | %(d) | .62 | % | .61 | % | |||||||||||
4.38 | % | 4.13 | % | 4.02 | %(e) | 3.96 | % | 3.93 | % | 3.83 | % | |||||||||||
37 | %(g) | 42 | % | 24 | %(f) | 45 | % | 39 | % | 49 | % |
See Notes to Financial Statements.
Prudential National Muni Fund, Inc. | 51 |
Financial Highlights
(Unaudited) continued
Class B | ||||
Six Months Ended February 28, 2010 | ||||
Per Share Operating Performance: | ||||
Net Asset Value, Beginning Of Period | $ | 14.46 | ||
Income (loss) from investment operations | ||||
Net investment income | .28 | |||
Net realized and unrealized gain (loss) on investment and financial futures transactions | .27 | |||
Total from investment operations | .55 | |||
Less Dividends and Distributions | ||||
Dividends from net investment income | (.28 | ) | ||
Distributions from net realized gains | — | |||
Total dividends and distributions | (.28 | ) | ||
Net asset value, end of period | $ | 14.73 | ||
Total Return(b): | 3.86 | % | ||
Ratios/Supplemental Data: | ||||
Net assets, end of period (000) | $ | 36,369 | ||
Average net assets (000) | $ | 36,707 | ||
Ratios to average net assets: | ||||
Expenses, including distribution and service (12b-1) fees | 1.07 | %(e) | ||
Expenses, excluding distribution and service (12b-1) fees | .57 | %(e) | ||
Net investment income | 3.89 | %(e) |
(a) | For the eight-month period ended August 31, 2007. The Fund changed its fiscal year end from December 31 to August 31. |
(b) | Total return does not consider the effects of sales loads. Total investment return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions. Total investment returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods of less than one full year are not annualized. |
(c) | The expense ratio reflects the interest expense and fees related to the liability for the floating rate notes issued in conjunction with the inverse floater securities. The total expense ratio excluding interest expense and fees is 1.07%, 1.08%, 1.08% and 1.12% and the expense ratio excluding 12b-1 and interest expense and fees is .57%, .58%, .58% and .62% for the year ended August 31, 2009, the year ended August 31, 2008, the eight-month period ended August 31, 2007 and the year ended December 31, 2006, respectively. |
(d) | Less than $.005. |
(e) | Annualized. |
See Notes to Financial Statements.
52 | Visit our website at www.prudentialfunds.com |
Class B | ||||||||||||||||||||||
Year Ended August 31, | Eight-Month August 31, 2007(a) | Year Ended December 31, | ||||||||||||||||||||
2009 | 2008 | 2006 | 2005 | 2004 | ||||||||||||||||||
$ | 14.45 | $ | 14.68 | $ | 15.16 | $ | 15.13 | $ | 15.36 | $ | 15.56 | |||||||||||
.57 | .57 | .38 | .55 | .56 | .55 | |||||||||||||||||
— | (d) | (.22 | ) | (.48 | ) | .10 | (.15 | ) | .02 | |||||||||||||
.57 | .35 | (.10 | ) | .65 | .41 | .57 | ||||||||||||||||
(.56 | ) | (.56 | ) | (.37 | ) | (.55 | ) | (.56 | ) | (.55 | ) | |||||||||||
— | (.02 | ) | (.01 | ) | (.07 | ) | (.08 | ) | (.22 | ) | ||||||||||||
(.56 | ) | (.58 | ) | (.38 | ) | (.62 | ) | (.64 | ) | (.77 | ) | |||||||||||
$ | 14.46 | $ | 14.45 | $ | 14.68 | $ | 15.16 | $ | 15.13 | $ | 15.36 | |||||||||||
4.20 | % | 2.41 | % | (.62 | )% | 4.42 | % | 2.76 | % | 3.85 | % | |||||||||||
$ | 39,395 | $ | 34,787 | $ | 46,405 | $ | 53,763 | $ | 27,013 | $ | 36,285 | |||||||||||
$ | 32,332 | $ | 40,259 | $ | 50,297 | $ | 25,361 | $ | 32,345 | $ | 39,139 | |||||||||||
1.09 | %(c) | 1.16 | %(c) | 1.21 | %(c)(e) | 1.22 | %(c) | 1.12 | % | 1.11 | % | |||||||||||
.59 | %(c) | .66 | %(c) | .71 | %(c)(e) | .72 | %(c) | .62 | % | .61 | % | |||||||||||
4.12 | % | 3.87 | % | 3.77 | %(e) | 3.72 | % | 3.67 | % | 3.58 | % |
See Notes to Financial Statements.
Prudential National Muni Fund, Inc. | 53 |
Financial Highlights
(Unaudited) continued
Class C | ||||
Six Months Ended February 28, 2010 | ||||
Per Share Operating Performance: | ||||
Net Asset Value, Beginning Of Period | $ | 14.46 | ||
Income (loss) from investment operations | ||||
Net investment income | .27 | |||
Net realized and unrealized gain (loss) on investment and financial futures transactions | .27 | |||
Total from investment operations | .54 | |||
Less Dividends and Distributions | ||||
Dividends from net investment income | (.27 | ) | ||
Distributions from net realized gains | — | |||
Total dividends and distributions | (.27 | ) | ||
Net asset value, end of period | $ | 14.73 | ||
Total Return(b): | 3.73 | % | ||
Ratios/Supplemental Data: | ||||
Net assets, end of period (000) | $ | 22,910 | ||
Average net assets (000) | $ | 21,784 | ||
Ratios to average net assets: | ||||
Expenses, including distribution and service (12b-1) fees(c) | 1.32 | %(e) | ||
Expenses, excluding distribution and service (12b-1) fees | .57 | %(e) | ||
Net investment income | 3.65 | %(e) |
(a) | For the eight-month period ended August 31, 2007. The Fund changed its fiscal year end from December 31 to August 31. |
(b) | Total return does not consider the effects of sales loads. Total investment return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions. Total investment returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods of less than one full year are not annualized. |
(c) | The distributor of the Fund has contractually agreed to limit its distribution and service (12b-1) fees to .75 of 1% of the average daily net assets of the Class C shares. |
(d) | The expense ratio reflects the interest expense and fees related to the liability for the floating rate notes issued in conjunction with the inverse floater securities. The total expense ratio excluding interest expense and fees is 1.32%, 1.33%, 1.33% and 1.37% and the expense ratio excluding 12b-1 and interest expense and fees is .57%, .58%, .58% and .62% for the year ended August 31, 2009, the year ended August 31, 2008, the eight-month period ended August 31, 2007 and the year ended December 31, 2006, respectively. |
(e) | Annualized. |
See Notes to Financial Statements.
54 | Visit our website at www.prudentialfunds.com |
Class C | ||||||||||||||||||||||
Year Ended August 31, | Eight-Month August 31, 2007(a) | Year Ended December 31, | ||||||||||||||||||||
2009 | 2008 | 2006 | 2005 | 2004 | ||||||||||||||||||
$ | 14.44 | $ | 14.68 | $ | 15.16 | $ | 15.13 | $ | 15.36 | $ | 15.56 | |||||||||||
.53 | .53 | .35 | .52 | .52 | .51 | |||||||||||||||||
.02 | (.22 | ) | (.47 | ) | .10 | (.15 | ) | .02 | ||||||||||||||
.55 | .31 | (.12 | ) | .62 | .37 | .53 | ||||||||||||||||
(.53 | ) | (.53 | ) | (.35 | ) | (.52 | ) | (.52 | ) | (.51 | ) | |||||||||||
— | (.02 | ) | (.01 | ) | (.07 | ) | (.08 | ) | (.22 | ) | ||||||||||||
(.53 | ) | (.55 | ) | (.36 | ) | (.59 | ) | (.60 | ) | (.73 | ) | |||||||||||
$ | 14.46 | $ | 14.44 | $ | 14.68 | $ | 15.16 | $ | 15.13 | $ | 15.36 | |||||||||||
4.02 | % | 2.08 | % | (.74 | )% | 4.16 | % | 2.50 | % | 3.59 | % | |||||||||||
$ | 20,495 | $ | 10,912 | $ | 11,244 | $ | 12,255 | $ | 3,482 | $ | 4,261 | |||||||||||
$ | 13,974 | $ | 11,228 | $ | 11,867 | $ | 3,884 | $ | 3,822 | $ | 4,628 | |||||||||||
1.34 | %(d) | 1.41 | %(d) | 1.46 | %(d)(e) | 1.47 | %(d) | 1.37 | % | 1.36 | % | |||||||||||
.59 | %(d) | .66 | %(d) | .71 | %(d)(e) | .72 | %(d) | .62 | % | .61 | % | |||||||||||
3.88 | % | 3.63 | % | 3.52 | %(e) | 3.49 | % | 3.42 | % | 3.33 | % |
See Notes to Financial Statements.
Prudential National Muni Fund, Inc. | 55 |
Financial Highlights
(Unaudited) continued
Class Z | ||||
Six Months Ended February 28, 2010 | ||||
Per Share Operating Performance: | ||||
Net Asset Value, Beginning Of Period | $ | 14.41 | ||
Income (loss) from investment operations | ||||
Net investment income | .32 | |||
Net realized and unrealized gain (loss) on investment and financial futures transactions | .27 | |||
Total from investment operations | .59 | |||
Less Dividends and Distributions | ||||
Dividends from net investment income | (.32 | ) | ||
Distributions from net realized gains | — | |||
Total dividends and distributions | (.32 | ) | ||
Net asset value, end of period | $ | 14.68 | ||
Total Return(b): | 4.12 | % | ||
Ratios/Supplemental Data: | ||||
Net assets, end of period (000) | $ | 12,401 | ||
Average net assets (000) | $ | 12,249 | ||
Ratios to average net assets: | ||||
Expenses, including distribution and service (12b-1) fees | .57 | %(d) | ||
Expenses, excluding distribution and service (12b-1) fees | .57 | %(d) | ||
Net investment income | 4.39 | %(d) |
(a) | For the eight-month period ended August 31, 2007. The Fund changed its fiscal year end from December 31 to August 31. |
(b) | Total investment return is calculated assuming a purchase of a share on the first day and a sale on the last day of each period reported and includes reinvestment of dividends and distributions. Total investment returns may reflect adjustments to conform to generally accepted accounting principles. Total returns for periods of less than one full year are not annualized. |
(c) | The expense ratio reflects the interest expense and fees related to the liability for the floating rate notes issued in conjunction with the inverse floater securities. The total expense ratio excluding interest expense and fees is .57%, .58%, .58% and .62% and the expense ratio excluding 12b-1 and interest expense and fees is .57%, .58%, .58% and .62% for the year ended August 31, 2009, the year ended August 31, 2008, the eight-month period ended August 31, 2007 and the year ended December 31, 2006, respectively. |
(d) | Annualized. |
See Notes to Financial Statements.
56 | Visit our website at www.prudentialfunds.com |
Class Z | ||||||||||||||||||||||
Year Ended August 31, | Eight-Month Period Ended August 31, 2007(a) | Year Ended December 31, | ||||||||||||||||||||
2009 | 2008 | 2006 | 2005 | 2004 | ||||||||||||||||||
$ | 14.40 | $ | 14.63 | $ | 15.11 | $ | 15.08 | $ | 15.31 | $ | 15.51 | |||||||||||
.63 | .64 | .43 | .63 | .64 | .63 | |||||||||||||||||
.01 | (.22 | ) | (.48 | ) | .10 | (.15 | ) | .02 | ||||||||||||||
.64 | .42 | (.05 | ) | .73 | .49 | .65 | ||||||||||||||||
(.63 | ) | (.63 | ) | (.42 | ) | (.63 | ) | (.64 | ) | (.63 | ) | |||||||||||
— | (.02 | ) | (.01 | ) | (.07 | ) | (.08 | ) | (.22 | ) | ||||||||||||
(.63 | ) | (.65 | ) | (.43 | ) | (.70 | ) | (.72 | ) | (.85 | ) | |||||||||||
$ | 14.41 | $ | 14.40 | $ | 14.63 | $ | 15.11 | $ | 15.08 | $ | 15.31 | |||||||||||
4.74 | % | 2.91 | % | (.30 | )% | 4.94 | % | 3.27 | % | 4.37 | % | |||||||||||
$ | 13,016 | $ | 4,540 | $ | 4,742 | $ | 5,450 | $ | 3,166 | $ | 4,013 | |||||||||||
$ | 7,357 | $ | 4,506 | $ | 5,089 | $ | 3,139 | $ | 3,785 | $ | 4,064 | |||||||||||
.59 | %(c) | .66 | %(c) | .71 | %(c)(d) | .72 | %(c) | .62 | % | .61 | % | |||||||||||
.59 | %(c) | .66 | %(c) | .71 | %(c)(d) | .72 | %(c) | .62 | % | .61 | % | |||||||||||
4.62 | % | 4.38 | % | 4.27 | %(d) | 4.13 | % | 4.17 | % | 4.08 | % |
See Notes to Financial Statements.
Prudential National Muni Fund, Inc. | 57 |
Results of Proxy Voting
(Unaudited)
At a special meeting of shareholders held on March 9, 2010, Fund shareholders approved a proposal to elect Directors.
The individuals listed in the table below were elected as directors of the Fund. All directors, with the exception of Mr. Benjamin, served as directors to the Fund prior to the shareholder meeting.
Director | For | Withheld | ||
Kevin J. Bannon | 40,277,422.298 | 1,082,678.368 | ||
Linda W. Bynoe | 40,176,962.971 | 1,183,407.695 | ||
Michael S. Hyland | 40,271,523.009 | 1,088,577.657 | ||
Douglas H. McCorkindale | 40,119,178.001 | 1,240,922.665 | ||
Stephen P. Munn | 40,202,754.776 | 1,157,345.890 | ||
Richard A. Redeker | 40,180,522.171 | 1,179,578.495 | ||
Robin B. Smith | 40,123,390.687 | 1,236,709.979 | ||
Stephen G. Stoneburn | 40,191,833.650 | 1,168,267.016 | ||
Judy A. Rice | 40,251,073.828 | 1,109,026.838 | ||
Scott E. Benjamin | 40,273,353.634 | 1,086,747.032 |
See Notes to Financial Statements.
58 | Visit our website at www.prudentialfunds.com |
n MAIL | n TELEPHONE | n WEBSITE | ||
Gateway Center Three 100 Mulberry Street Newark, NJ 07102 | (800) 225-1852 | www.prudentialfunds.com |
PROXY VOTING |
The Board of Directors of the Fund has delegated to the Fund’s investment subadviser the responsibility for voting any proxies and maintaining proxy recordkeeping with respect to the Fund. A description of these proxy voting policies and procedures is available without charge, upon request, by calling (800) 225-1852 or by visiting the Securities and Exchange Commission’s website at www.sec.gov. Information regarding how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on the Fund’s website and on the Commission’s website. |
DIRECTORS |
Kevin J. Bannon • Scott E. Benjamin • Linda W. Bynoe • Michael S. Hyland • Douglas H. McCorkindale • Stephen P. Munn • Richard A. Redeker • Judy A. Rice • Robin B. Smith • Stephen G. Stoneburn |
OFFICERS |
Judy A. Rice, President • Scott E. Benjamin, Vice President • Grace C. Torres, Treasurer and Principal Financial and Accounting Officer • Kathryn L. Quirk, Chief Legal Officer • Deborah A. Docs, Secretary • Timothy J. Knierim, Chief Compliance Officer • Valerie M. Simpson, Deputy Chief Compliance Officer • Theresa C. Thompson, Deputy Chief Compliance Officer • Noreen M. Fierro, Anti-Money Laundering Compliance Officer • Jonathan D. Shain, Assistant Secretary • Claudia DiGiacomo, Assistant Secretary • John P. Schwartz, Assistant Secretary • Andrew R. French, Assistant Secretary • M. Sadiq Peshimam, Assistant Treasurer • Peter Parrella, Assistant Treasurer |
MANAGER | Prudential Investments LLC | Gateway Center Three 100 Mulberry Street Newark, NJ 07102 | ||
| ||||
INVESTMENT SUBADVISER | Prudential Investment Management, Inc. | Gateway Center Two 100 Mulberry Street | ||
| ||||
DISTRIBUTOR | Prudential Investment Management Services LLC | Gateway Center Three 100 Mulberry Street Newark, NJ 07102 | ||
| ||||
CUSTODIAN | The Bank of New York Mellon | One Wall Street New York, NY 10286 | ||
| ||||
TRANSFER AGENT | Prudential Mutual Fund Services LLC | PO Box 9658 Providence, RI 02940 | ||
| ||||
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM | KPMG LLP | 345 Park Avenue New York, NY 10154 | ||
| ||||
FUND COUNSEL | Willkie Farr & Gallagher LLP | 787 Seventh Avenue New York, NY 10019 |
An investor should consider the investment objectives, risks, charges, and expenses of the Fund carefully before investing. The prospectus for the Fund contains this and other information about the Fund. An investor may obtain a prospectus by visiting our website at www.prudentialfunds.com or by calling (800) 225-1852. The prospectus should be read carefully before investing. |
E-DELIVERY |
To receive your mutual fund documents online, go to www.prudentialfunds.com/edelivery and enroll. Instead of receiving printed documents by mail, you will receive notification via e-mail when new materials are available. You can cancel your enrollment or change your e-mail address at any time by visiting the website address above. |
SHAREHOLDER COMMUNICATIONS WITH DIRECTORS |
Shareholders can communicate directly with the Board of Directors by writing to the Chair of the Board, Prudential National Muni Fund, Inc., Prudential Investments, Attn: Board of Directors, 100 Mulberry Street, Gateway Center Three, Newark, NJ 07102. Shareholders can communicate directly with an individual Director by writing to the same address. Communications are not screened before being delivered to the addressee. |
AVAILABILITY OF PORTFOLIO SCHEDULE |
The Fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission for the first and third quarters of each fiscal year on Form N-Q. The Fund’s Forms N-Q are available on the Commission’s website at www.sec.gov. The Fund’s Forms N-Q may also be reviewed and copied at the Commission’s Public Reference Room in Washington, D.C. Information on the operation and location of the Public Reference Room may be obtained by calling (202) 551-8090. The Fund’s schedule of portfolio holdings is also available on the Fund’s website as of the end of each fiscal quarter. |
Mutual Funds:
ARE NOT INSURED BY THE FDIC OR ANY FEDERAL GOVERNMENT AGENCY | MAY LOSE VALUE | ARE NOT A DEPOSIT OF OR GUARANTEED BY ANY BANK OR ANY BANK AFFILIATE |
Prudential National Muni Fund, Inc. | ||||||||||||
Share Class | A | B | C | Z | ||||||||
NASDAQ | PRNMX | PBHMX | PNMCX | DNMZX | ||||||||
CUSIP | 744410105 | 744410204 | 744410303 | 744410402 | ||||||||
MF104E2 0176723-00001-00
Item 2 – Code of Ethics – Not required, as this is not an annual filing.
Item 3 – Audit Committee Financial Expert – Not required, as this is not an annual filing.
Item 4 – Principal Accountant Fees and Services – Not required, as this is not an annual filing.
Item 5 – Audit Committee of Listed Registrants – Not applicable.
Item 6 – Schedule of Investments – The schedule is included as part of the report to shareholders filed under Item 1 of this Form.
Item 7 – Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies – Not applicable.
Item 8 – Portfolio Managers of Closed-End Management Investment Companies – Not applicable.
Item 9 – Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers – Not applicable.
Item 10 – Submission of Matters to a Vote of Security Holders – Not applicable.
Item 11 – Controls and Procedures
(a) | It is the conclusion of the registrant’s principal executive officer and principal financial officer that the effectiveness of the registrant’s current disclosure controls and procedures (such disclosure controls and procedures having been evaluated within 90 days of the date of this filing) provide reasonable assurance that the information required to be disclosed by the registrant has been recorded, processed, summarized and reported within the time period specified in the Commission’s rules and forms and that the information required to be disclosed by the registrant has been accumulated and communicated to the registrant’s principal executive officer and principal financial officer in order to allow timely decisions regarding required disclosure. |
(b) | There has been no significant change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter of the period covered by this report that has materially affected, or is likely to materially affect, the registrant’s internal control over financial reporting. |
Item 12 – Exhibits
(a) | (1) Code of Ethics – Not required, as this is not an annual filing. |
(2) | Certifications pursuant to Section 302 of the Sarbanes-Oxley Act – Attached hereto as Exhibit EX-99.CERT. |
(3) | Any written solicitation to purchase securities under Rule 23c-1. – Not applicable. |
(b) | Certifications pursuant to Section 906 of the Sarbanes-Oxley Act – Attached hereto as Exhibit EX-99.906CERT. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) Prudential National Muni Fund, Inc.
By: (Signature and Title) | /s/ Deborah A. Docs | |
Deborah A. Docs Secretary |
Date: April 28, 2010
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
By: (Signature and Title) | /s/ Judy A. Rice | |
Judy A. Rice President and Principal Executive Officer |
Date: April 28, 2010
By: (Signature and Title) | /s/ Grace C. Torres | |
Grace C. Torres Treasurer and Principal Financial Officer |
Date: April 28, 2010