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Table of Contents
| | |
| Chairman’s Letter to Shareholders | 4 |
| | |
| Portfolio Manager’s Comments | 5 |
| | |
| Fund Leverage | 7 |
| | |
| Common Share Information | 8 |
| | |
| Risk Considerations | 10 |
| | |
| Performance Overview and Holding Summaries | 11 |
| | |
| Shareholder Meeting Report | 13 |
| | |
| Portfolios of Investments | 14 |
| | |
| Statement of Assets and Liabilities | 27 |
| | |
| Statement of Operations | 28 |
| | |
| Statement of Changes in Net Assets | 29 |
| | |
| Statement of Cash Flows | 30 |
| | |
| Financial Highlights | 32 |
| | |
| Notes to Financial Statements | 35 |
| | |
| Additional Fund Information | 47 |
| | |
| Glossary of Terms Used in this Report | 48 |
| | |
| Reinvest Automatically, Easily and Conveniently | 50 |
3
Chairman’s Letter to Shareholders
Dear Shareholders,
The global economy seemed to reach a turning point in 2018. Growth was peaking in the U.S. and slowing everywhere else. Deregulation and tax law changes, which lowered corporate and individual tax rates and encouraged companies to repatriate overseas profits, helped boost U.S. economic growth and amplify corporate earnings during 2018. Meanwhile, a weakening housing market and a flattening yield curve in the U.S. and disappointing economic growth across Europe, China and Japan signaled caution. With future corporate profits looking less certain, rising interest rates, a stronger U.S. dollar, trade wars and unpredictable politics, bearish sentiment took hold, pressuring stocks, corporate bonds and commodities alike.
Although downside risks have been rising, the likelihood of a near-term recession remains low. Global growth is indeed slowing, but it’s still positive. The U.S. economy remains strong, even in the face of late-cycle pressures. Low unemployment and firming wages should continue to support consumer spending, and the November mid-term elections resulted in change, but no major surprises. In China, the government remains committed to using fiscal stimulus to offset softening exports. Europe also remains vulnerable to trade policy as well as Brexit uncertainty, but underlying strengths in European economies, including low unemployment that drives domestic demand, remain supportive of a mild expansion. In a slower growth environment, there are opportunities for investors who seek them more selectively.
We expect volatility and challenging conditions to persist in 2019 but also think there is potential for upside. You can prepare your investment portfolio by working with your financial advisor to review your goals, timeline and risk tolerance. On behalf of the other members of the Nuveen Fund Board, we look forward to continuing to earn your trust in the months and years ahead.
Sincerely,
Terence J. Toth
Chairman of the Board
January 22, 2019
4
Portfolio Manager’s Comments
Nuveen Connecticut Quality Municipal Income Fund (NTC)
Nuveen Massachusetts Quality Municipal Income Fund (NMT)
These Funds feature portfolio management by Nuveen Asset Management, LLC (NAM), an affiliate of Nuveen, LLC. Portfolio manager Michael S. Hamilton discusses key investment strategies and the six-month performance of the Nuveen Connecticut and Massachusetts Funds. Michael assumed portfolio management responsibility for these Funds in 2011.
What key strategies were used to manage these Funds during the six-month reporting period ended November 30, 2018?
In the six-month reporting period, municipal bond prices fell as yields rose across the yield curve. Rates rose unevenly, however, with larger increases among shorter and longer maturities than in the middle-range maturities. Despite some pockets of high yield outflows, supply and demand conditions remained favorable and credit fundamentals continued to be relatively robust. During this time, we continued to take a bottom-up approach to discovering sectors that appeared undervalued as well as individual credits that we believed had the potential to perform well over the long term.
Our trading activity continued to focus on pursuing the Funds’ investment objectives. We sought bonds in areas of the market that we expected to perform well as the economy improved. The Funds’ positioning emphasized longer maturities, lower rated credits and/or sectors offering higher yields. Most of our portfolio activity involved selling depreciated bonds that were bought when interest rates were lower and reinvesting the proceeds into similar bonds offering higher yield levels to capitalize on the tax loss (which can be used to offset future taxable gains) and boost the Funds’ income distribution capabilities. In the rising interest rate environment of this reporting period, we found more opportunities to buy attractive higher yielding bonds for this bond exchanging strategy.
As of November 30, 2018, the Funds continued to use inverse floating rate securities. We employ inverse floaters for a variety of reasons, including duration management, income enhancement and total return enhancement.
This material is not intended to be a recommendation or investment advice, does not constitute a solicitation to buy or sell securities, and is not provided in a fiduciary capacity. The information provided does not take into account the specific objectives or circumstances of any particular investor, or suggest any specific course of action. Investment decisions should be made based on an investor’s objectives and circumstances and in consultation with his or her advisors.Certain statements in this report are forward-looking statements. Discussions of specific investments are for illustration only and are not intended as recommendations of individual investments. The forward-looking statements and other views expressed herein are those of the portfolio manager as of the date of this report. Actual future results or occurrences may differ significantly from those anticipated in any forward-looking statements, and the views expressed herein are subject to change at any time, due to numerous market and other factors. The Funds disclaim any obligation to update publicly or revise any forward-looking statements or views expressed herein.
For financial reporting purposes, the ratings disclosed are the highest rating given by one of the following national rating agencies: Standard & Poor’s Group (S&P), Moody’s Investors Service, Inc. (Moody’s) or Fitch, Inc. (Fitch). This treatment of split-rated securities may differ from that used for other purposes, such as for Fund investment policies. Credit ratings are subject to change. AAA, AA, A and BBB are investment grade ratings, while BB, B, CCC, CC, C and D are below investment grade ratings. Holdings designated N/R are not rated by these national rating agencies.
Bond insurance guarantees only the payment of principal and interest on the bond when due, and not the value of the bonds themselves, which will fluctuate with the bond market and the financial success of the issuer and the insurer. Insurance relates specifically to the bonds in the portfolio and not to the share prices of a Fund. No representation is made as to the insurers’ ability to meet their commitments.
Refer to the Glossary of Terms Used in this Report for further definition of the terms used within this section.
5
Portfolio Manager’s Comments (continued)
How did the Funds perform during the six-month reporting period ended November 30, 2018?
The tables in each Fund's Performance Overview and Holding Summaries section of this report provide the Funds’ total returns for the six-month, one-year, five-year and ten-year periods ended November 30, 2018. Each Fund's total returns at common share net asset value (NAV) are compared with the performance of a corresponding market index.
For the six months ended November 30, 2018, the total returns at common share NAV for NTC and NMT underperformed the returns for the national S&P Municipal Bond Index and their respective state’s S&P Municipal Bond Index.
The Funds’ performance was affected by duration and yield curve positioning, credit ratings allocations and sector allocations. In addition, the use of regulatory leverage was a factor affecting performance of the Funds. Leverage is discussed in more detail later in the Fund Leverage section of this report.
For both Funds, duration and yield curve positioning was a detractor from relative performance. As the municipal bond yield curve steepened, shorter duration bonds outperformed, which was disadvantageous for the Funds’ overweight allocations to long duration credits and underweight allocations to short duration credits.
The performance impact of credit ratings allocations differed between the two states. For the Connecticut Fund, an underweight to AAA rated paper was beneficial because the highest grade segment underperformed the market. Additionally, NTC’s overweight allocations to the AA and single A ratings categories also contributed positively. In Massachusetts, however, higher grade bonds outperformed the market, which hurt the Fund’s underweights in AAA and AA rated bonds. NMT’s overweight to single-A rated bonds also dampened relative performance.
Sector performance was also mixed. NTC’s sector positioning detracted from relative performance primarily due to the Fund’s underweight in state-issued general obligation (GO) bonds. In the Connecticut Fund, we have maintained a longstanding tilt toward revenue sectors over state-issued GO bonds partly because of our concerns about the state’s credit condition. Relative to the national benchmark, NTC holds an overweight to state-issued paper. But compared to the state-specific index, where Connecticut state issues represent roughly 40% of the index, the Fund is meaningfully underweight in state GOs. In this reporting period, state legislative actions and the election of a new governor in November 2018 helped credit spreads on state GOs tighten, and the bonds outperformed. The Fund’s underweight to state GOs was detrimental to performance, as were the overweight allocations to the hospitals and water and sewer sectors. Modestly benefiting performance, however, was NTC’s overweight to local GOs, a segment which performed even better than state GOs. Sector positioning in the Massachusetts Fund contributed positively to performance, where the underweight to the tax-supported sector and overweight to the health care and water and sewer sectors were the most beneficial. Although the health care and water and sewer sectors’ overall performance were somewhat lackluster, NMT’s holdings in these two sectors with short call structures were outperformers.
6
Fund Leverage
IMPACT OF THE FUNDS’ LEVERAGE STRATEGIES ON PERFORMANCE
One important factor impacting the returns of the Funds’ common shares relative to their comparative benchmarks was the Funds’ use of leverage through their issuance of preferred shares and/or investments in inverse floating rate securities, which represent leveraged investments in underlying bonds. The Funds use leverage because our research has shown that, over time, leveraging provides opportunities for additional income, particularly in the recent market environment where short-term market rates are at or near historical lows, meaning that the short-term rates the Fund has been paying on its leveraging instruments in recent years have been much lower than the interest the Fund has been earning on its portfolio of long-term bonds that it has bought with the proceeds of that leverage.
However, use of leverage can expose Fund common shares to additional price volatility. When a Fund uses leverage, the Fund common shares will experience a greater increase in their net asset value if the municipal bonds acquired through the use of leverage increase in value, but will also experience a correspondingly larger decline in their net asset value if the bonds acquired through leverage decline in value, which will make the shares’ net asset value more volatile, and total return performance more variable, over time.
In addition, common share income in levered funds will typically decrease in comparison to unlevered funds when short-term interest rates increase and increase when short-term interest rates decrease. Over the last few quarters, short-term interest rates have indeed increased from their extended lows after the 2007-09 financial crisis. This increase has reduced common share net income, and also reduced potential for long-term total returns. Nevertheless, the ability to effectively borrow at current short-term rates is still resulting in enhanced common share income, and management believes that the advantages of continuation of leverage outweigh the associated increase in risk and volatility described above.
Leverage from issuance of preferred shares had a positive impact on the performance of the Funds over the reporting period. The use of leverage through inverse floating rate securities had a negligible impact on the performance of the Funds over the reporting period.
As of November 30, 2018, the Funds’ percentages of leverage are as shown in the accompanying table.
| | | |
| | NTC | NMT |
| Effective Leverage* | 39.15% | 38.65% |
| Regulatory Leverage* | 36.86% | 36.43% |
| |
| * Effective Leverage is a Fund’s effective economic leverage, and includes both regulatory leverage and the leverage effects of certain derivative and other investments in a Fund’s portfolio that increase the Fund’s investment exposure. Currently, the leverage effects of Tender Option Bond (TOB) inverse floater holdings are included in effective leverage values, in addition to any regulatory leverage. Regulatory leverage consists of preferred shares issued or borrowings of a Fund. Both of these are part of a Fund’s capital structure. A Fund, however, may from time to time borrow on a typically transient basis in connection with its day-to-day operations, primarily in connection with the need to settle portfolio trades. Such incidental borrowings are excluded from the calculation of a Fund’s effective leverage ratio. Regulatory leverage is subject to asset coverage limits set forth in the Investment Company Act of 1940. |
THE FUNDS’ REGULATORY LEVERAGE
As of November 30, 2018, the Funds have issued and outstanding preferred shares as shown in the accompanying table.
| | | |
| | Variable Rate | Variable Rate |
| | Preferred* | Remarketed Preferred** |
| | Shares Issued at | Shares Issued at |
| | Liquidation Preference | Liquidation Preference |
| NTC | $112,000,000 | $ — |
| NMT | $ 74,000,000 | $ — |
| | | |
| * Preferred shares of the Fund featuring a floating rate dividend based on a predetermined formula or spread to an index rate. Includes the following preferred shares AMTP, iMTP, VMTP, MFP-VRM and VRDP in Special Rate Mode, where applicable. See Notes to Financial Statements, Note 4 – Fund Shares, Preferred Shares for further details. |
| ** Preferred shares of the Fund featuring floating rate dividends set by a remarketing agent via a regular remarketing. Includes the following preferred shares VRDP not in Special Rate Mode, MFP-VRRM and MFP-VRDM, where applicable. See Notes to Financial Statements, Note 4 – Fund Shares, Preferred Shares for further details. |
Refer to Notes to Financial Statements, Note 4 — Fund Shares, Preferred Shares and Note 10 — Subsequent Events for further details on preferred shares and each Fund’s respective transactions.
7
Common Share Information
COMMON SHARE DISTRIBUTION INFORMATION
The following information regarding the Funds’ distributions is current as of November 30, 2018. Each Fund’s distribution levels may vary over time based on each Fund’s investment activity and portfolio investments value changes.
During the current reporting period, each Fund’s distributions to common shareholders were as shown in the accompanying table.
| | | | | | | |
| | | Per Common | |
| | | Share Amounts | |
| Monthly Distributions (Ex-Dividend Date) | | NTC | | | NMT | |
| June 2018 | | $ | 0.0410 | | | $ | 0.0445 | |
| July | | | 0.0410 | | | | 0.0445 | |
| August | | | 0.0410 | | | | 0.0445 | |
| September | | | 0.0410 | | | | 0.0410 | |
| October | | | 0.0410 | | | | 0.0410 | |
| November 2018 | | | 0.0410 | | | | 0.0410 | |
| Total Distributions from Net Investment Income | | $ | 0.2460 | | | $ | 0.2565 | |
| | | | | | | | | |
| Yields | | | | | | | | |
| Market Yield* | | | 4.38 | % | | | 4.05 | % |
| Taxable-Equivalent Yield* | | | 6.26 | % | | | 5.71 | % |
| | |
* Market Yield for a Fund is based on the Fund’s current annualized monthly dividend divided by the Fund’s current market price as of the end of the current reporting period. Taxable-Equivalent Yield represents the yield that must be earned on a fully taxable investment in order to equal the yield of the Fund on an after-tax basis. It is based on an assumed combined federal and state income tax rate of 30.0% and 29.1% for NTC and NMT, respectively. Your actual combined federal and state income tax rate may differ from the assumed rate. Taxable-Equivalent Yield also assumes that 100% of the income generated and paid by the Fund is exempt from both federal and state income tax; a Fund’s Taxable-Equivalent Yield will be lower to the extent the Fund invests in municipal securities paying income that is not exempt from state and/or federal income tax (e.g., certain out-of-state bonds). If the comparison were instead to investments that generate qualified dividend income, which is taxable at a rate lower than an individual’s ordinary graduated tax rate, the fund’s Taxable-Equivalent Yield would be lower. |
Each Fund seeks to pay regular monthly dividends out of its net investment income at a rate that reflects its past and projected net income performance. To permit each Fund to maintain a more stable monthly dividend, the Fund may pay dividends at a rate that may be more or less than the amount of net income actually earned by the Fund during the period. Distributions to shareholders are determined on a tax basis, which may differ from amounts recorded in the accounting records. In instances where the monthly dividend exceeds the earned net investment income, the Fund would report a negative undistributed net ordinary income. Refer to Note 6 – Income Tax Information for additional information regarding the amounts of undistributed net ordinary income and undistributed net long-term capital gains and the character of the actual distributions paid by the Fund during the period.
All monthly dividends paid by each Fund during the current reporting period were paid from net investment income. If a portion of the Fund’s monthly distributions is sourced or comprised of elements other than net investment income, including capital gains and/or a return of capital, shareholders will be notified of those sources. For financial reporting purposes, the per share amounts of each Fund’s distributions for the reporting period are presented in this report’s Financial Highlights. For income tax purposes, distribution information for each Fund as of its most recent tax year end is presented in Note 6 – Income Tax Information within the Notes to Financial Statements of this report.
8
COMMON SHARE REPURCHASES
During August 2018, the Funds’ Board of Trustees reauthorized an open-market share repurchase program, allowing each Fund to repurchase an aggregate of up to approximately 10% of its outstanding shares.
As of November 30, 2018, and since the inception of the Funds’ repurchase programs, the Funds have cumulatively repurchased and retired their outstanding common shares as shown in the accompanying table.
| | | | | | | |
| | | NTC | | | NMT | |
| Common shares cumulatively repurchased and retired | | | 316,999 | | | | 25,900 | |
| Common shares authorized for repurchase | | | 1,455,000 | | | | 935,000 | |
During the current reporting period, the Funds repurchased and retired their common shares at a weighted average price per share and a weighted average discount per share as shown in the accompanying table.
| | | | | | | |
| | | NTC | | | NMT | |
| Common shares repurchased and retired | | | 56,199 | | | | 25,900 | |
| Weighted average price per common share repurchased and retired | | $ | 11.20 | | | $ | 11.67 | |
| Weighted average discount per common share repurchased and retired | | | 15.69 | % | | | 15.19 | % |
OTHER COMMON SHARE INFORMATION
As of November 30, 2018, and during the current reporting period, the Funds’ common share prices were trading at a premium/(discount) to their common share NAVs as shown in the accompanying table.
| | | | | | | |
| | | NTC | | | NMT | |
| Common share NAV | | $ | 13.35 | | | $ | 13.85 | |
| Common share price | | $ | 11.23 | | | $ | 12.15 | |
| Premium/(Discount) to NAV | | | (15.88 | )% | | | (12.27 | )% |
| 6-month average premium/(discount) to NAV | | | (14.64 | )% | | | (13.32 | )% |
9
Risk Considerations
Fund shares are not guaranteed or endorsed by any bank or other insured depository institution, and are not federally insured by the Federal Deposit Insurance Corporation.
Nuveen Connecticut Quality Municipal Income Fund (NTC)
Investing in closed-end funds involves risk; principal loss is possible. There is no guarantee the Fund’s investment objectives will be achieved. Closed-end fund shares may frequently trade at a discount or premium to their net asset value. Debt or fixed income securities such as those held by the Fund, are subject to market risk, credit risk, interest rate risk, derivatives risk, liquidity risk, and income risk. As interest rates rise, bond prices fall. Leverage increases return volatility and magnifies the Fund’s potential return and its risks; there is no guarantee a fund’s leverage strategy will be successful. State concentration makes the Fund more susceptible to local adverse economic, political, or regulatory changes affecting municipal bond issuers. These and other risk considerations such as inverse floater risk and tax risk are described in more detail on the Fund’s web page at www.nuveen.com/NTC.
Nuveen Massachusetts Quality Municipal Income Fund (NMT)
Investing in closed-end funds involves risk; principal loss is possible. There is no guarantee the Fund’s investment objectives will be achieved. Closed-end fund shares may frequently trade at a discount or premium to their net asset value. Debt or fixed income securities such as those held by the Fund, are subject to market risk, credit risk, interest rate risk, derivatives risk, liquidity risk, and income risk. As interest rates rise, bond prices fall. Leverage increases return volatility and magnifies the Fund’s potential return and its risks; there is no guarantee a fund’s leverage strategy will be successful. State concentration makes the Fund more susceptible to local adverse economic, political, or regulatory changes affecting municipal bond issuers. These and other risk considerations such as inverse floater risk and tax risk are described in more detail on the Fund’s web page at www.nuveen.com/NMT.
10
NTC | Nuveen Connecticut Quality Municipal |
| | Income Fund |
| | Performance Overview and Holding Summaries as of |
| | November 30, 2018 |
Refer to the Glossary of Terms Used in this Report for further definition of the terms used within this section.
Average Annual Total Returns as of November 30, 2018
| | | | | |
| | Cumulative | Average Annual |
| | 6-Month | 1-Year | 5-Year | 10-Year |
| NTC at Common Share NAV | (0.40)% | (0.12)% | 4.16% | 5.71% |
| NTC at Common Share Price | (2.36)% | (1.87)% | 4.40% | 6.08% |
| S&P Municipal Bond Connecticut Index | 0.82% | 1.49% | 2.54% | 4.17% |
| S&P Municipal Bond Index | 0.36% | 1.16% | 3.59% | 5.07% |
Past performance is not predictive of future results. Current performance may be higher or lower than the data shown. Returns do not reflect the deduction of taxes that shareholders may have to pay on Fund distributions or upon the sale of Fund shares. Returns at NAV are net of Fund expenses, and assume reinvestment of distributions. Comparative index return information is provided for the Fund’s shares at NAV only. Indexes are not available for direct investment.
Common Share Price Performance — Weekly Closing Price
This data relates to the securities held in the Fund’s portfolio of investments as of the end of the reporting period. It should not be construed as a measure of performance for the Fund itself. Holdings are subject to change.
For financial reporting purposes, the ratings disclosed are the highest rating given by one of the following national rating agencies: Standard & Poor’s Group, Moody’s Investors Service, Inc. or Fitch, Inc. This treatment of split-rated securities may differ from that used for other purposes, such as for Fund investment policies. Credit ratings are subject to change. AAA, AA, A and BBB are investment grade ratings; BB, B, CCC, CC, C and D are below investment grade ratings. Holdings designated N/R are not rated by these national rating agencies.
| | |
Fund Allocation | |
(% of net assets) | |
| Long-Term Municipal Bonds | 159.7% |
| Other Assets Less Liabilities | 2.0% |
Net Assets Plus Floating Rate Obligations | |
and VMTP Shares, net of deferred | |
offering costs | 161.7% |
| Floating Rate Obligations | (3.3)% |
| VMTP Shares, net of deferred | |
| offering costs | (58.4)% |
Net Assets | 100% |
| | |
Portfolio Composition | |
(% of total investments) | |
| Tax Obligation/General | 26.3% |
| Health Care | 21.7% |
| Tax Obligation/Limited | 13.4% |
| Water and Sewer | 13.2% |
| Education and Civic Organizations | 11.2% |
| U.S. Guaranteed | 10.8% |
| Other | 3.4% |
Total | 100% |
| | |
Portfolio Credit Quality | |
(% of total investment exposure) | |
| U.S. Guaranteed | 10.6% |
| AAA | 1.1% |
| AA | 36.9% |
| A | 44.0% |
| BBB | 6.4% |
| N/R (not rated) | 1.0% |
Total | 100% |
11
NMT | Nuveen Massachusetts Quality Municipal |
| | Income Fund |
| | Performance Overview and Holding Summaries as of |
| | November 30, 2018 |
Refer to the Glossary of Terms Used in this Report for further definition of the terms used within this section.
Average Annual Total Returns as of November 30, 2018
| | | | | |
| | Cumulative | Average Annual |
| | 6-Month | 1-Year | 5-Year | 10-Year |
| NMT at Common Share NAV | (1.22)% | (1.01)% | 4.80% | 6.68% |
| NMT at Common Share Price | (1.83)% | (12.77)% | 4.99% | 7.41% |
| S&P Municipal Bond Massachusetts Index | 0.21% | 0.68% | 3.16% | 4.57% |
| S&P Municipal Bond Index | 0.36% | 1.16% | 3.59% | 5.07% |
Past performance is not predictive of future results. Current performance may be higher or lower than the data shown. Returns do not reflect the deduction of taxes that shareholders may have to pay on Fund distributions or upon the sale of Fund shares. Returns at NAV are net of Fund expenses, and assume reinvestment of distributions. Comparative index return information is provided for the Fund’s shares at NAV only. Indexes are not available for direct investment.
Common Share Price Performance — Weekly Closing Price
This data relates to the securities held in the Fund’s portfolio of investments as of the end of the reporting period. It should not be construed as a measure of performance for the Fund itself. Holdings are subject to change.
For financial reporting purposes, the ratings disclosed are the highest rating given by one of the following national rating agencies: Standard & Poor’s Group, Moody’s Investors Service, Inc. or Fitch, Inc. This treatment of split-rated securities may differ from that used for other purposes, such as for Fund investment policies. Credit ratings are subject to change. AAA, AA, A and BBB are investment grade ratings; BB, B, CCC, CC, C and D are below investment grade ratings. Holdings designated N/R are not rated by these national rating agencies.
| | |
Fund Allocation | |
(% of net assets) | |
| Long-Term Municipal Bonds | 154.9% |
| Other Assets Less Liabilities | 2.2% |
Net Assets Plus VRDP Shares, | |
net of deferred offering costs | 157.1% |
| VRDP Shares, net of deferred | |
| offering costs | (57.1)% |
Net Assets | 100% |
| | |
Portfolio Composition | |
(% of total investments) | |
| Education and Civic Organizations | 28.4% |
| Health Care | 20.1% |
| U.S. Guaranteed | 13.5% |
| Tax Obligation/Limited | 11.8% |
| Tax Obligation/General | 9.4% |
| Transportation | 7.2% |
| Water and Sewer | 5.3% |
| Other | 4.3% |
Total | 100% |
| | |
Portfolio Credit Quality | |
(% of total investment exposure) | |
| U.S. Guaranteed | 13.0% |
| AAA | 5.0% |
| AA | 46.9% |
| A | 23.4% |
| BBB | 9.4% |
| N/R (not rated) | 2.3% |
Total | 100% |
12
Shareholder Meeting Report
The annual meeting of shareholders was held in the offices of Nuveen on November 13, 2018 for NMT; at this meeting the shareholders were asked to elect Board Members.
| | | | |
| | | NMT | |
| | Common and | | |
| | Preferred | | |
| | shares voting | | |
| | together | | Preferred |
| | as a class | | Shares |
Approval of the Board Members was reached as follows: | | | |
| Margo L. Cook | | | |
| For | 8,388,662 | | — |
| Withhold | 576,216 | | — |
| Total | 8,964,878 | | — |
| Jack B. Evans | | | |
| For | 8,374,608 | | — |
| Withhold | 590,270 | | — |
| Total | 8,964,878 | | — |
| Albin F. Moschner | | | |
| For | 8,379,723 | | — |
| Withhold | 585,155 | | — |
| Total | 8,964,878 | | — |
| William C. Hunter | | | |
| For | — | | 740 |
| Withhold | — | | — |
| Total | — | | 740 |
| William J. Schneider | | | |
| For | — | | 740 |
| Withhold | — | | — |
| Total | — | | 740 |
13
| | |
NTC | Nuveen Connecticut Quality Municipal |
| | Income Fund |
| | Portfolio of Investments |
| | November 30, 2018 (Unaudited) |
| | | | | | |
Principal | | | Optional Call | | |
Amount (000) | | Description (1) | Provisions (2) | Ratings (3) | Value |
| | | LONG-TERM INVESTMENTS – 159.7% (100.0% of Total Investments) | | | |
| | | MUNICIPAL BONDS – 159.7% (100.0% of Total Investments) | | | |
| | | Education and Civic Organizations – 17.9% (11.2% of Total Investments) | | | |
| $ 4,250 | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Connecticut | 7/26 at 100.00 | A2 | $ 4,147,873 |
| | | College, Refunding Series 2016L-1, 4.000%, 7/01/46 | | | |
| 1,150 | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Connecticut | 7/21 at 100.00 | A2 | 1,211,031 |
| | | College, Series 2011H, 5.000%, 7/01/41 | | | |
| 5,565 | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Fairfield | 7/26 at 100.00 | A– | 6,005,804 |
| | | University, Series 2016Q-1, 5.000%, 7/01/46 | | | |
| 1,510 | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Loomis Chaffee | No Opt. Call | A1 | 1,538,766 |
| | | School, Series 2005F, 5.250%, 7/01/19 – AMBAC Insured | | | |
| 1,125 | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Norwich Free | 7/23 at 100.00 | A1 | 1,138,579 |
| | | Academy, Series 2013B, 4.000%, 7/01/34 | | | |
| 7,030 | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Quinnipiac | 7/25 at 100.00 | A– | 7,625,370 |
| | | University, Refunding Series 2015L, 5.000%, 7/01/45 | | | |
| | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Quinnipiac | | | |
| | | University, Series 2016M: | | | |
| 500 | | 5.000%, 7/01/34 | 7/26 at 100.00 | A– | 553,285 |
| 1,500 | | 5.000%, 7/01/36 | 7/26 at 100.00 | A– | 1,648,755 |
| 6,145 | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Sacred Heart | 7/27 at 100.00 | A | 6,683,118 |
| | | University, Series 2017I-1, 5.000%, 7/01/42 | | | |
| | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, The Loomis | | | |
| | | Chaffee School Issue, Series 2011-I: | | | |
| 560 | | 5.000%, 7/01/23 – AGM Insured | 7/21 at 100.00 | A1 | 594,877 |
| 225 | | 5.000%, 7/01/24 – AGM Insured | 7/21 at 100.00 | A1 | 238,667 |
| 2,250 | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, University of | 7/28 at 100.00 | BBB | 2,412,653 |
| | | New Haven, Series 2018K-1, 5.000%, 7/01/38 | | | |
| 515 | | University of Connecticut, Student Fee Revenue Bonds, Refunding Series 2010A, | 11/19 at 100.00 | AA– | 528,905 |
| | | 5.000%, 11/15/27 | | | |
| 32,325 | | Total Education and Civic Organizations | | | 34,327,683 |
| | | Health Care – 34.7% (21.7% of Total Investments) | | | |
| 5,500 | | Connecticut Health and Educational Facilities Authority Revenue Bonds, Hartford | 7/25 at 100.00 | A | 5,805,140 |
| | | HealthCare, Series 2015F, 5.000%, 7/01/45 | | | |
| | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Bristol | | | |
| | | Hospital, Series 2002B: | | | |
| 350 | | 5.500%, 7/01/21 – RAAI Insured | 2/19 at 100.00 | AA | 350,994 |
| 3,000 | | 5.500%, 7/01/32 – RAAI Insured | 2/19 at 100.00 | AA | 3,004,950 |
| 7,025 | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Hartford | 7/21 at 100.00 | A | 7,346,112 |
| | | HealthCare, Series 2011A, 5.000%, 7/01/41 | | | |
| 500 | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Hartford | 7/24 at 100.00 | A | 526,185 |
| | | HealthCare, Series 2014E, 5.000%, 7/01/42 | | | |
| 1,915 | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Middlesex | 7/25 at 100.00 | A3 | 2,042,022 |
| | | Hospital, Series 2015O, 5.000%, 7/01/36 | | | |
| 1,275 | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Stamford | 7/20 at 100.00 | BBB+ | 1,322,379 |
| | | Hospital, Series 2010-I, 5.000%, 7/01/30 | | | |
| | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Stamford | | | |
| | | Hospital, Series 2012J: | | | |
| 1,000 | | 5.000%, 7/01/37 | 7/22 at 100.00 | BBB+ | 1,058,950 |
| 7,155 | | 5.000%, 7/01/42 | 7/22 at 100.00 | BBB+ | 7,544,589 |
14
| | | | | | |
Principal | | | Optional Call | | |
Amount (000) | | Description (1) | Provisions (2) | Ratings (3) | Value |
| | | Health Care (continued) | | | |
| $ 4,000 | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Stamford | 7/26 at 100.00 | BBB+ | $ 3,809,080 |
| | | Hospital, Series 2016K, 4.000%, 7/01/46 | | | |
| | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Trinity Health | | | |
| | | Credit Group, Series 2016CT: | | | |
| 2,650 | | 5.000%, 12/01/41 | 6/26 at 100.00 | AA– | 2,903,711 |
| 770 | | 5.000%, 12/01/45 | 6/26 at 100.00 | AA– | 840,393 |
| 5,915 | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Western | 7/21 at 100.00 | A | 6,254,876 |
| | | Connecticut Health, Series 2011M, 5.375%, 7/01/41 | | | |
| 4,000 | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Western | 7/21 at 100.00 | A | 4,217,360 |
| | | Connecticut Health, Series 2011N, 5.000%, 7/01/29 | | | |
| | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Yale-New Haven | | | |
| | | Health Issue, Series 2014E: | | | |
| 2,610 | | 5.000%, 7/01/32 | 7/24 at 100.00 | AA– | 2,868,912 |
| 2,740 | | 5.000%, 7/01/33 | 7/24 at 100.00 | AA– | 3,003,232 |
| 900 | | 5.000%, 7/01/34 | 7/24 at 100.00 | AA– | 983,421 |
| 4,540 | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Ascension Health | 11/19 at 100.00 | AA+ | 4,643,149 |
| | | Series 2010A, 5.000%, 11/15/40 | | | |
| 7,475 | | Monroe County Industrial Development Corporation, New York, FHA Insured Mortgage Revenue | 2/21 at 100.00 | AA | 7,989,952 |
| | | Bonds, Unity Hospital of Rochester Project, Series 2010, 5.500%, 8/15/40 | | | |
| 63,320 | | Total Health Care | | | 66,515,407 |
| | | Long-Term Care – 1.6% (1.0% of Total Investments) | | | |
| 1,100 | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Duncaster, Inc., | 8/24 at 100.00 | BBB | 1,127,137 |
| | | Series 2014A, 5.000%, 8/01/44 | | | |
| 630 | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Healthcare | 9/26 at 100.00 | N/R | 634,775 |
| | | Facility Expansion Church Home of Hartford Inc. Project, Series 2016A, 5.000%, 9/01/46, 144A | | | |
| 1,260 | | Connecticut Housing Finance Authority, State Supported Special Obligation Bonds, | 6/20 at 100.00 | A1 | 1,310,249 |
| | | Refunding Series 2010-16, 5.000%, 6/15/30 | | | |
| 2,990 | | Total Long-Term Care | | | 3,072,161 |
| | | Tax Obligation/General – 42.0% (26.3% of Total Investments) | | | |
| | | Bridgeport, Connecticut, General Obligation Bonds, Series 2014A: | | | |
| 2,345 | | 5.000%, 7/01/32 – AGM Insured | 7/24 at 100.00 | AA | 2,526,433 |
| 1,600 | | 5.000%, 7/01/34 – AGM Insured | 7/24 at 100.00 | AA | 1,715,408 |
| 2,800 | | Bridgeport, Connecticut, General Obligation Bonds, Series 2016D, 5.000%, 8/15/41 – | 8/26 at 100.00 | AA | 2,999,808 |
| | | AGM Insured | | | |
| | | Bridgeport, Connecticut, General Obligation Bonds, Series 2017A: | | | |
| 1,470 | | 5.000%, 11/01/36 | 11/27 at 100.00 | A | 1,581,132 |
| 750 | | 5.000%, 11/01/37 | 11/27 at 100.00 | A | 804,150 |
| | | City of New Haven, Connecticut, General Obligation Bonds, Series 2017A: | | | |
| 1,000 | | 5.000%, 8/01/35 | 8/27 at 100.00 | BBB+ | 1,089,690 |
| 1,425 | | 5.000%, 8/01/36 | 8/27 at 100.00 | BBB+ | 1,547,707 |
| 5,580 | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Connecticut | 11/23 at 100.00 | A1 | 5,984,327 |
| | | State University System, Series 2013N, 5.000%, 11/01/31 | | | |
| 3,075 | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Connecticut | 11/26 at 100.00 | A1 | 3,451,688 |
| | | State University System, Series 2016P-1, 5.000%, 11/01/29 | | | |
| 2,290 | | Connecticut State, General Obligation Bonds, Refunding Series 2012E, 5.000%, 9/15/32 | 9/22 at 100.00 | A1 | 2,416,065 |
| 1,000 | | Connecticut State, General Obligation Bonds, Series 2011D, 5.000%, 11/01/31 | 11/21 at 100.00 | A1 | 1,048,880 |
| 2,600 | | Connecticut State, General Obligation Bonds, Series 2014A, 5.000%, 3/01/31 | 3/24 at 100.00 | A1 | 2,791,282 |
| 3,500 | | Connecticut State, General Obligation Bonds, Series 2014F, 5.000%, 11/15/34 | 11/24 at 100.00 | A1 | 3,761,345 |
| 4,580 | | Connecticut State, General Obligation Bonds, Series 2015A, 4.500%, 3/15/33 | 3/25 at 100.00 | A1 | 4,789,764 |
| 2,630 | | Connecticut State, General Obligation Bonds, Series 2015F, 5.000%, 11/15/34 | 11/25 at 100.00 | A1 | 2,848,106 |
15
| | |
NTC | Nuveen Connecticut Quality Municipal Income Fund |
| | Portfolio of Investments (continued) |
| | November 30, 2018 (Unaudited) |
| | | | | | |
Principal | | | Optional Call | | |
Amount (000) | | Description (1) | Provisions (2) | Ratings (3) | Value |
| | | Tax Obligation/General (continued) | | | |
| | | Connecticut State, General Obligation Bonds, Series 2017A: | | | |
| $ 4,000 | | 5.000%, 4/15/34 | 4/27 at 100.00 | A1 | $ 4,364,320 |
| 3,730 | | 5.000%, 4/15/35 | 4/27 at 100.00 | A1 | 4,053,242 |
| 1,225 | | Hamden, Connecticut, General Obligation Bonds, Series 2016, 5.000%, 8/15/32 – | 8/24 at 100.00 | AA | 1,352,902 |
| | | BAM Insured | | | |
| 870 | | Hartford, Connecticut, General Obligation Bonds, Series 2009A, 5.000%, 8/15/28 – | 8/19 at 100.00 | AA | 887,130 |
| | | AGC Insured | | | |
| | | Milford, Connecticut, General Obligation Bonds, Series 2018: | | | |
| 1,055 | | 4.000%, 11/01/36 (WI/DD, Settling 12/03/18) | 11/24 at 100.00 | AA+ | 1,074,264 |
| 1,055 | | 4.000%, 11/01/37 (WI/DD, Settling 12/03/18) | 11/24 at 100.00 | AA+ | 1,071,806 |
| | | New Haven, Connecticut, General Obligation Bonds, Refunding Series 2016A: | | | |
| 1,000 | | 5.000%, 8/15/32 – AGM Insured | 8/26 at 100.00 | AA | 1,114,810 |
| 1,550 | | 5.000%, 8/15/35 – AGM Insured | 8/26 at 100.00 | AA | 1,704,814 |
| 985 | | New Haven, Connecticut, General Obligation Bonds, Series 2014A, 5.000%, 8/01/33 – | 8/24 at 100.00 | AA | 1,067,642 |
| | | AGM Insured | | | |
| | | New Haven, Connecticut, General Obligation Bonds, Series 2015: | | | |
| 790 | | 5.000%, 9/01/32 – AGM Insured | 9/25 at 100.00 | AA | 868,297 |
| 1,620 | | 5.000%, 9/01/33 – AGM Insured | 9/25 at 100.00 | AA | 1,773,398 |
| 500 | | 5.000%, 9/01/35 – AGM Insured | 9/25 at 100.00 | AA | 544,205 |
| 900 | | North Haven, Connecticut, General Obligation Bonds, Series 2006, 5.000%, 7/15/24 | No Opt. Call | Aa1 | 1,028,034 |
| 1,670 | | Oregon State, General Obligation Bonds, Oregon University System Projects, Series 2011G, | 8/21 at 100.00 | AA+ | 1,779,168 |
| | | 5.000%, 8/01/36 | | | |
| | | State of Connecticut General Obligation Bonds, Series 2018A: | | | |
| 3,500 | | 5.000%, 4/15/35 (UB) (4) | 4/28 at 100.00 | A+ | 3,824,975 |
| 5,000 | | 5.000%, 4/15/38 (UB) (4) | 4/28 at 100.00 | A+ | 5,409,450 |
| 600 | | Stratford, Connecticut, General Obligation Bonds, Series 2014, 5.000%, 12/15/32 | 12/22 at 100.00 | AA | 650,688 |
| | | Suffield, Connecticut, General Obligation Bonds, Refunding Series 2005: | | | |
| 820 | | 5.000%, 6/15/19 | No Opt. Call | AA+ | 833,924 |
| 1,400 | | 5.000%, 6/15/21 | No Opt. Call | AA+ | 1,502,634 |
| 2,285 | | The Metropolitan District Hartford County, Connecticut General Obligation Bonds, Series | 7/28 at 100.00 | AA | 2,562,719 |
| | | 2018, 5.000%, 7/15/36 | | | |
| 1,000 | | Town of Hamden, Connecticut, General Obligation Bonds, Refunding Series 2018A, 5.000%, | 8/28 at 100.00 | AA | 1,123,130 |
| | | 8/15/30 – BAM Insured | | | |
| | | Waterbury, Connecticut, General Obligation Bonds, Lot A Series 2015: | | | |
| 445 | | 5.000%, 8/01/30 – BAM Insured | 8/25 at 100.00 | AA | 502,361 |
| 390 | | 5.000%, 8/01/31 – BAM Insured | 8/25 at 100.00 | AA | 439,768 |
| 610 | | 5.000%, 8/01/32 – BAM Insured | 8/25 at 100.00 | AA | 685,872 |
| 445 | | 5.000%, 8/01/33 – BAM Insured | 8/25 at 100.00 | AA | 499,205 |
| 445 | | 5.000%, 8/01/34 – BAM Insured | 8/25 at 100.00 | AA | 498,066 |
| 74,535 | | Total Tax Obligation/General | | | 80,572,609 |
| | | Tax Obligation/Limited – 21.3% (13.4% of Total Investments) | | | |
| 3,855 | | Connecticut State, Special Tax Obligation Bonds, Transportation Infrastructure Purposes | 10/23 at 100.00 | A+ | 4,145,204 |
| | | Series 2013A, 5.000%, 10/01/33 | | | |
| 1,380 | | Connecticut State, Special Tax Obligation Bonds, Transportation Infrastructure Purposes | 8/25 at 100.00 | A+ | 1,507,112 |
| | | Series 2015A, 5.000%, 8/01/33 | | | |
| | | Connecticut State, Special Tax Obligation Bonds, Transportation Infrastructure Purposes | | | |
| | | Series 2016A: | | | |
| 5,300 | | 5.000%, 9/01/33 | 9/26 at 100.00 | A+ | 5,823,852 |
| 1,075 | | 5.000%, 9/01/34 | 9/26 at 100.00 | A+ | 1,175,040 |
| | | Connecticut State, Special Tax Obligation Bonds, Transportation Infrastructure Purposes, | | | |
| | | Series 2014A: | | | |
| 5,000 | | 5.000%, 9/01/33 | 9/24 at 100.00 | A+ | 5,398,700 |
| 1,000 | | 5.000%, 9/01/34 | 9/24 at 100.00 | A+ | 1,075,960 |
16
| | | | | | |
Principal | | | Optional Call | | |
Amount (000) | | Description (1) | Provisions (2) | Ratings (3) | Value |
| | | Tax Obligation/Limited (continued) | | | |
| $ 1,500 | | Government of Guam, Business Privilege Tax Bonds, Refunding Series 2015D, | 11/25 at 100.00 | A | $ 1,575,480 |
| | | 5.000%,11/15/39 | | | |
| | | Government of Guam, Business Privilege Tax Bonds, Series 2011A: | | | |
| 840 | | 5.250%, 1/01/36 | 1/22 at 100.00 | A | 879,850 |
| 3,200 | | 5.125%, 1/01/42 | 1/22 at 100.00 | A | 3,294,176 |
| 2,315 | | Harbor Point Infrastructure Improvement District, Connecticut, Special Obligation | 4/27 at 100.00 | N/R | 2,389,612 |
| | | Revenue Bonds, Harbor Point Project, Refunding Series 2017, 5.000%, 4/01/39, 144A | | | |
| 1,500 | | Puerto Rico Municipal Finance Agency, Series 2002A, 5.250%, 8/01/21 – AGM Insured | 2/19 at 100.00 | AA | 1,544,370 |
| 2,600 | | University of Connecticut, General Obligation Bonds, Series 2010A, 5.000%, 2/15/28 | 2/20 at 100.00 | AA– | 2,677,116 |
| 2,500 | | University of Connecticut, General Obligation Bonds, Series 2013A, 5.000%, 8/15/32 | 8/23 at 100.00 | AA– | 2,701,600 |
| 760 | | University of Connecticut, General Obligation Bonds, Series 2014A, 5.000%, 2/15/31 | 2/24 at 100.00 | AA– | 822,753 |
| | | University of Connecticut, General Obligation Bonds, Series 2015A: | | | |
| 2,250 | | 5.000%, 3/15/31 | 3/26 at 100.00 | AA– | 2,466,045 |
| 1,415 | | 5.000%, 2/15/34 | 2/25 at 100.00 | AA– | 1,531,370 |
| 1,790 | | Virgin Islands Public Finance Authority, Gross Receipts Taxes Loan Note, Refunding | 10/22 at 100.00 | AA | 1,910,664 |
| | | Series 2012A, 5.000%, 10/01/32 – AGM Insured | | | |
| 38,280 | | Total Tax Obligation/Limited | | | 40,918,904 |
| | | U.S. Guaranteed – 17.3% (10.8% of Total Investments) (5) | | | |
| 2,500 | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Fairfield | 7/20 at 100.00 | A– | 2,618,850 |
| | | University, Series 2010-O, 5.000%, 7/01/40 (Pre-refunded 7/01/20) | | | |
| 2,000 | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Lawrence and | 7/21 at 100.00 | N/R | 2,142,540 |
| | | Memorial Hospitals, Series 2011F, 5.000%, 7/01/36 (Pre-refunded 7/01/21) | | | |
| | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Middlesex | | | |
| | | Hospital, Series 2011N: | | | |
| 1,105 | | 5.000%, 7/01/25 (Pre-refunded 7/01/21) | 7/21 at 100.00 | A3 | 1,186,626 |
| 400 | | 5.000%, 7/01/26 (Pre-refunded 7/01/21) | 7/21 at 100.00 | A3 | 429,548 |
| 500 | | 5.000%, 7/01/27 (Pre-refunded 7/01/21) | 7/21 at 100.00 | A3 | 536,935 |
| | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Sacred Heart | | | |
| | | University, Series 2011G: | | | |
| 250 | | 5.125%, 7/01/26 (Pre-refunded 7/01/21) | 7/21 at 100.00 | A | 269,248 |
| 3,260 | | 5.625%, 7/01/41 (Pre-refunded 7/01/21) | 7/21 at 100.00 | A | 3,551,672 |
| 3,000 | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Wesleyan | 7/20 at 100.00 | AA | 3,142,620 |
| | | University, Series 2010G, 5.000%, 7/01/35 (Pre-refunded 7/01/20) | | | |
| 1,240 | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Yale-New Haven | 7/20 at 100.00 | Aa3 | 1,306,538 |
| | | Hospital, Series 2010M, 5.500%, 7/01/40 (Pre-refunded 7/01/20) | | | |
| 1,010 | | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Catholic Health | 11/20 at 100.00 | AA– | 1,062,177 |
| | | East Series 2010, 4.750%, 11/15/29 (Pre-refunded 11/15/20) | | | |
| 2,050 | | Guam Government Waterworks Authority, Water and Wastewater System Revenue Bonds, Series | 7/20 at 100.00 | A– | 2,164,944 |
| | | 2010, 5.625%, 7/01/40 (Pre-refunded 7/01/20) | | | |
| 3,000 | | Harbor Point Infrastructure Improvement District, Connecticut, Special Obligation | 4/20 at 100.00 | N/R | 3,228,780 |
| | | Revenue Bonds, Harbor Point Project, Series 2010A, 7.875%, 4/01/39 (Pre-refunded 4/01/20) | | | |
| 870 | | Hartford, Connecticut, General Obligation Bonds, Series 2009A, 5.000%, 8/15/28 – AGC | 8/19 at 100.00 | AA | 888,627 |
| | | Insured (Pre-refunded 8/15/19) | | | |
| 2,220 | | Oregon State, General Obligation Bonds, Oregon University System Projects, Series 2011G, | 8/21 at 100.00 | N/R | 2,385,723 |
| | | 5.000%, 8/01/36 (Pre-refunded 8/02/21) | | | |
| 1,010 | | Puerto Rico Public Finance Corporation, Commonwealth Appropriation Bonds, Series 1998A, | No Opt. Call | Aaa | 1,096,577 |
| | | 5.125%, 6/01/24 – AMBAC Insured (ETM) | | | |
17
| | |
NTC | Nuveen Connecticut Quality Municipal Income Fund |
| | Portfolio of Investments (continued) |
| | November 30, 2018 (Unaudited) |
| | | | | | |
Principal | | | Optional Call | | |
Amount (000) | | Description (1) | Provisions (2) | Ratings (3) | Value |
| | | U.S. Guaranteed (5) (continued) | | | |
| $ 4,870 | | South Central Connecticut Regional Water Authority, Water System Revenue Bonds, | 8/21 at 100.00 | AA– | $ 5,246,256 |
| | | Twentieth-Sixth Series, 2011, 5.000%, 8/01/41 (Pre-refunded 8/01/21) | | | |
| 1,725 | | Stamford, Connecticut, Special Obligation Revenue Bonds, Mill River Corridor Project, | 4/21 at 100.00 | N/R | 1,914,923 |
| | | Series 2011aA, 7.000%, 4/01/41 (Pre-refunded 4/01/21) | | | |
| 31,010 | | Total U.S. Guaranteed | | | 33,172,584 |
| | | Utilities – 3.8% (2.4% of Total Investments) | | | |
| | | Connecticut Municipal Electric Energy Cooperative, Power Supply System Revenue Bonds, | | | |
| | | Tender Option Bond Trust 2016-XG0059: | | | |
| 1,295 | | 12.397%, 1/01/32, 144A (IF) (4) | 1/23 at 100.00 | Aa3 | 1,745,556 |
| 410 | | 12.299%, 1/01/38, 144A (IF) (4) | 1/23 at 100.00 | Aa3 | 543,467 |
| | | Connecticut Transmission Municipal Electric Energy Cooperative, Transmission System | | | |
| | | Revenue Bonds, Series 2012A: | | | |
| 655 | | 5.000%, 1/01/31 | 1/22 at 100.00 | Aa3 | 704,636 |
| 500 | | 5.000%, 1/01/32 | 1/22 at 100.00 | Aa3 | 537,125 |
| 2,830 | | 5.000%, 1/01/42 | 1/22 at 100.00 | Aa3 | 3,021,053 |
| 500 | | Eastern Connecticut Resource Recovery Authority, Solid Waste Revenue Bonds, Wheelabrator | 1/19 at 100.00 | A– | 507,355 |
| | | Lisbon Project, Series 1993A, 5.500%, 1/01/20 (Alternative Minimum Tax) | | | |
| 250 | | Guam Power Authority, Revenue Bonds, Series 2012A, 5.000%, 10/01/34 – AGM Insured | 10/22 at 100.00 | AA | 269,670 |
| 6,440 | | Total Utilities | | | 7,328,862 |
| | | Water and Sewer – 21.1% (13.2% of Total Investments) | | | |
| | | Connecticut, State Revolving Fund General Revenue Bonds, Green Bonds, Series 2017A: | | | |
| 1,500 | | 5.000%, 5/01/36 | 5/27 at 100.00 | AAA | 1,708,245 |
| 1,500 | | 5.000%, 5/01/37 | 5/27 at 100.00 | AAA | 1,703,490 |
| | | Greater New Haven Water Pollution Control Authority, Connecticut, Regional Wastewater | | | |
| | | System Revenue Bonds, Refunding Series 2014B: | | | |
| 500 | | 5.000%, 8/15/30 | 8/24 at 100.00 | AA | 556,080 |
| 1,000 | | 5.000%, 8/15/31 | 8/24 at 100.00 | AA | 1,110,500 |
| 500 | | 5.000%, 8/15/32 | 8/24 at 100.00 | AA | 557,755 |
| 55 | | Greater New Haven Water Pollution Control Authority, Connecticut, Regional Wastewater | 11/19 at 100.00 | AA | 55,135 |
| | | System Revenue Bonds, Series 2005A, 5.000%, 8/15/35 – NPFG Insured | | | |
| | | Guam Government Waterworks Authority, Water and Wastewater System Revenue Bonds, | | | |
| | | Refunding Series 2017: | | | |
| 1,335 | | 5.000%, 7/01/36 | 7/27 at 100.00 | A– | 1,416,328 |
| 890 | | 5.000%, 7/01/40 | 7/27 at 100.00 | A– | 934,536 |
| 3,045 | | Guam Government Waterworks Authority, Water and Wastewater System Revenue Bonds, Series | 7/23 at 100.00 | A– | 3,222,432 |
| | | 2013, 5.500%, 7/01/43 | | | |
| 235 | | Guam Government Waterworks Authority, Water and Wastewater System Revenue Bonds, Series | 7/26 at 100.00 | A– | 244,170 |
| | | 2016, 5.000%, 1/01/46 | | | |
| 10,015 | | Hartford County Metropolitan District, Connecticut, Clean Water Project Revenue Bonds, | 11/24 at 100.00 | Aa2 | 10,776,838 |
| | | Refunding Green Bond Series 2014A, 5.000%, 11/01/42 | | | |
| | | Hartford County Metropolitan District, Connecticut, Clean Water Project Revenue Bonds, | | | |
| | | Series 2013A: | | | |
| 4,100 | | 5.000%, 4/01/36 | 4/22 at 100.00 | Aa2 | 4,385,237 |
| 2,500 | | 5.000%, 4/01/39 | 4/22 at 100.00 | Aa2 | 2,669,000 |
| 795 | | South Central Connecticut Regional Water Authority Water System Revenue Bonds, Thirtieth | 8/24 at 100.00 | AA– | 867,695 |
| | | Series 2014A, 5.000%, 8/01/44 | | | |
18
| | | | | | |
Principal | | | Optional Call | | |
Amount (000) | | Description (1) | Provisions (2) | Ratings (3) | Value |
| | | Water and Sewer (continued) | | | |
| | | South Central Connecticut Regional Water Authority, Water System Revenue Bonds, | | | |
| | | Refunding Thirty-Second Series 2016B: | | | |
| $ 1,470�� | | 4.000%, 8/01/36 | 8/26 at 100.00 | AA– | $ 1,526,786 |
| 2,220 | | 5.000%, 8/01/37 | 8/26 at 100.00 | AA– | 2,489,641 |
| 1,270 | | South Central Connecticut Regional Water Authority, Water System Revenue Bonds, | 8/28 at 100.00 | AA– | 1,437,716 |
| | | Thirty-third Series 2018A, 5.000%, 8/01/42 | | | |
| 4,000 | | South Central Connecticut Regional Water Authority, Water System Revenue Bonds, | 8/22 at 100.00 | AA– | 4,334,960 |
| | | Twenty-Seventh Series 2012, 5.000%, 8/01/33 | | | |
| 500 | | Stamford, Connecticut, Water Pollution Control System and Facility Revenue Bonds, Series | 8/23 at 100.00 | AA+ | 559,875 |
| | | 2013A, 5.250%, 8/15/43 | | | |
| 37,430 | | Total Water and Sewer | | | 40,556,419 |
| $ 286,330 | | Total Long-Term Investments (cost $303,370,290) | | | 306,464,629 |
| | | Floating Rate Obligations – (3.3)% | | | (6,375,000) |
| | | Variable Rate MuniFund Term Preferred Shares, net of deferred offering costs – (58.4)% (6) | | | (111,994,257) |
| | | Other Assets Less Liabilities – 2.0% | | | 3,787,231 |
| | | Net Assets Applicable to Common Shares – 100% | | | $ 191,882,603 |
| | |
| (1) | All percentages shown in the Portfolio of Investments are based on net assets applicable to common shares unless otherwise noted. |
| (2) | Optional Call Provisions: Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. Certain mortgage-backed securities may be subject to periodic principal paydowns. |
| (3) | For financial reporting purposes, the ratings disclosed are the highest of Standard & Poor’s Group (“Standard & Poor’s”), Moody’s Investors Service, Inc. (“Moody’s”) or Fitch, Inc. (“Fitch”) rating. This treatment of split-rated securities may differ from that used for other purposes, such as for Fund investment policies. Ratings below BBB by Standard & Poor’s, Baa by Moody’s or BBB by Fitch are considered to be below investment grade. Holdings designated N/R are not rated by any of these national rating agencies. |
| (4) | Investment, or portion of investment, has been pledged to collateralize the net payment obligations for investments in inverse floating rate transactions. |
| (5) | Backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities, which ensure the timely payment of principal and interest. |
| (6) | Variable Rate MuniFund Term Preferred Shares, net of deferred offering costs as a percentage of Total Investments is 36.5%. |
| 144A | Investment is exempt from registration under Rule 144A of the Securities Act of 1933, as amended. These investments may only be resold in transactions exempt from registration, which are normally those transactions with qualified institutional buyers. |
| ETM | Escrowed to maturity. |
| IF | Inverse floating rate security issued by a tender option bond (“TOB”) trust, the interest rate on which varies inversely with the Securities Industry Financial Markets Association (SIFMA) short-term rate, which resets weekly, or a similar short-term rate, and is reduced by the expenses related to the TOB trust. |
| UB | Underlying bond of an inverse floating rate trust reflected as a financing transaction. See Notes to Financial Statements, Note 3 – Portfolio Securities and Investments in Derivatives, Inverse Floating Rate Securities for more information. |
| WI/DD | Investment, or portion of investment, purchased on a when-issued or delayed delivery basis. |
See accompanying notes to financial statements.
19
| | |
NMT | Nuveen Massachusetts Quality Municipal |
| | Income Fund |
| | Portfolio of Investments |
| | November 30, 2018 (Unaudited) |
| | | | | | |
Principal | | | Optional Call | | |
Amount (000) | | Description (1) | Provisions (2) | Ratings (3) | Value |
| | | LONG-TERM INVESTMENTS – 154.9% (100.0% of Total Investments) | | | |
| | | MUNICIPAL BONDS – 154.9% (100.0% of Total Investments) | | | |
| | | Education and Civic Organizations – 44.0% (28.4% of Total Investments) | | | |
| $ 3,515 | | Massachusetts Development Finance Agency, Revenue Bonds, Berklee College of Music, | 10/26 at 100.00 | A | $ 3,897,220 |
| | | Series 2016, 5.000%, 10/01/39 | | | |
| 2,200 | | Massachusetts Development Finance Agency, Revenue Bonds, Boston College, Series 2013S, | 7/23 at 100.00 | AA– | 2,425,324 |
| | | 5.000%, 7/01/38 | | | |
| 730 | | Massachusetts Development Finance Agency, Revenue Bonds, Boston College, Series 2017T, | 7/27 at 100.00 | AA– | 820,637 |
| | | 5.000%, 7/01/42 | | | |
| | | Massachusetts Development Finance Agency, Revenue Bonds, Boston University, Tender | | | |
| | | Option Bond Trust 2016-XG0070: | | | |
| 1,880 | | 12.479%, 10/01/48, 144A (IF) (4) | 10/23 at 100.00 | Aa3 | 2,503,596 |
| 575 | | 12.417%, 10/01/48, 144A (IF) (4) | 10/23 at 100.00 | Aa3 | 765,492 |
| | | Massachusetts Development Finance Agency, Revenue Bonds, Emerson College, Series 2017A: | | | |
| 2,000 | | 5.000%, 1/01/34 | 1/28 at 100.00 | BBB+ | 2,185,920 |
| 2,240 | | 5.000%, 1/01/37 | 1/28 at 100.00 | BBB+ | 2,423,187 |
| 2,150 | | Massachusetts Development Finance Agency, Revenue Bonds, Lesley University, Series | 7/21 at 100.00 | AA | 2,302,091 |
| | | 2011B-1, 5.250%, 7/01/33 – AGM Insured | | | |
| 1,955 | | Massachusetts Development Finance Agency, Revenue Bonds, Lesley University, Series 2016, | 7/26 at 100.00 | A– | 2,165,045 |
| | | 5.000%, 7/01/35 | | | |
| | | Massachusetts Development Finance Agency, Revenue Bonds, MCPHS University Issue, | | | |
| | | Series 2015H: | | | |
| 450 | | 3.500%, 7/01/35 | 7/25 at 100.00 | AA | 438,912 |
| 190 | | 5.000%, 7/01/37 | 7/25 at 100.00 | AA | 210,129 |
| 1,200 | | Massachusetts Development Finance Agency, Revenue Bonds, Merrimack College, Series 2017, | 7/26 at 100.00 | BBB– | 1,264,092 |
| | | 5.000%, 7/01/47 | | | |
| 550 | | Massachusetts Development Finance Agency, Revenue Bonds, Northeastern University, Series | 10/22 at 100.00 | A1 | 599,082 |
| | | 2012, 5.000%, 10/01/31 | | | |
| | | Massachusetts Development Finance Agency, Revenue Bonds, Northeastern University, | | | |
| | | Series 2014A: | | | |
| 875 | | 5.000%, 3/01/39 | 3/24 at 100.00 | A1 | 947,660 |
| 1,400 | | 5.000%, 3/01/44 | 3/24 at 100.00 | A1 | 1,511,356 |
| 500 | | Massachusetts Development Finance Agency, Revenue Bonds, Simmons College, Series 2013J, | 10/23 at 100.00 | BBB+ | 534,390 |
| | | 5.250%, 10/01/39 | | | |
| 1,230 | | Massachusetts Development Finance Agency, Revenue Bonds, Sterling and Francine Clark Art | 7/25 at 100.00 | AA | 1,390,663 |
| | | Institute, Series 2015, 5.000%, 7/01/33 | | | |
| | | Massachusetts Development Finance Agency, Revenue Bonds, The Broad Institute, | | | |
| | | Series 2017: | | | |
| 2,200 | | 5.000%, 4/01/35 | 10/27 at 100.00 | AA– | 2,518,648 |
| 1,250 | | 5.000%, 4/01/36 | 10/27 at 100.00 | AA– | 1,424,838 |
| 875 | | Massachusetts Development Finance Agency, Revenue Bonds, Tufts University, Series 2015Q, | 8/25 at 100.00 | Aa2 | 978,618 |
| | | 5.000%, 8/15/38 | | | |
| 1,325 | | Massachusetts Development Finance Agency, Revenue Bonds, Wheaton College, Series 2017H, | 1/28 at 100.00 | A3 | 1,472,910 |
| | | 5.000%, 1/01/42 | | | |
| 1,510 | | Massachusetts Development Finance Agency, Revenue Bonds, Woods Hole Oceanographic | 6/28 at 100.00 | AA– | 1,700,683 |
| | | Institution, Series 2018, 5.000%, 6/01/43 | | | |
| 1,365 | | Massachusetts Development Finance Agency, Revenue Bonds, Worcester Polytechnic | 9/22 at 100.00 | A1 | 1,459,390 |
| | | Institute, Series 2012, 5.000%, 9/01/50 | | | |
| 2,500 | | Massachusetts Development Finance Agency, Revenue Bonds, Worcester Polytechnic | 9/27 at 100.00 | A1 | 2,767,000 |
| | | Institute, Series 2017B, 5.000%, 9/01/42 | | | |
20
| | | | | | |
Principal | | | Optional Call | | |
Amount (000) | | Description (1) | Provisions (2) | Ratings (3) | Value |
| | | Education and Civic Organizations (continued) | | | |
| $ 700 | | Massachusetts Development Finance Agency, Revenue Bonds, Worcester Polytechnic | 9/27 at 100.00 | A1 | $ 771,246 |
| | | Institute, Series 2017, 5.000%, 9/01/47 | | | |
| 500 | | Massachusetts Development Finance Authority, Revenue Bonds, Suffolk University, | 7/27 at 100.00 | Baa2 | 546,220 |
| | | Refunding Series 2017, 5.000%, 7/01/35 | | | |
| 3,000 | | Massachusetts Development Finance Authority, Revenue Bonds, WGBH Educational Foundation, | No Opt. Call | AA– | 3,883,379 |
| | | Series 2002A, 5.750%, 1/01/42 – AMBAC Insured | | | |
| 2,495 | | Massachusetts Development Finance Authority, Revenue Bonds, WGBH Educational Foundation, | 7/26 at 100.00 | AA– | 2,761,316 |
| | | Series 2016, 5.000%, 1/01/40 | | | |
| | | Massachusetts Development Finance Authority, Revenue Refunding Bonds, Boston University, | | | |
| | | Series 1999P: | | | |
| 1,090 | | 6.000%, 5/15/29 | No Opt. Call | Aa3 | 1,337,103 |
| 1,000 | | 6.000%, 5/15/59 | 5/29 at 105.00 | Aa3 | 1,215,090 |
| 420 | | Massachusetts Educational Financing Authority, Education Loan Revenue Bonds, Series | 7/21 at 100.00 | AA | 437,161 |
| | | 2011J, 5.625%, 7/01/33 (Alternative Minimum Tax) | | | |
| 255 | | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Northeastern | 10/20 at 100.00 | A1 | 265,583 |
| | | University, Series 2010A, 4.875%, 10/01/35 | | | |
| 165 | | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Suffolk | 7/19 at 100.00 | Baa2 | 167,762 |
| | | University, Refunding Series 2009A, 5.750%, 7/01/39 | | | |
| 2,000 | | University of Massachusetts Building Authority, Project Revenue Bonds, Senior Series | 11/24 at 100.00 | Aa2 | 2,199,120 |
| | | 2014-1, 5.000%, 11/01/44 | | | |
| 4,000 | | University of Massachusetts Building Authority, Project Revenue Bonds, Senior Series | 11/25 at 100.00 | Aa2 | 4,450,835 |
| | | 2015-1, 5.000%, 11/01/40 | | | |
| 50,290 | | Total Education and Civic Organizations | | | 56,741,698 |
| | | Health Care – 31.1% (20.1% of Total Investments) | | | |
| 1,000 | | Massachusetts Development Finance Agency Revenue Bonds, Children’s Hospital Issue, | 10/24 at 100.00 | AA | 1,088,760 |
| | | Series 2014P, 5.000%, 10/01/46 | | | |
| 1,340 | | Massachusetts Development Finance Agency Revenue Bonds, South Shore Hospital, Series | 7/26 at 100.00 | A– | 1,424,715 |
| | | 2016I, 5.000%, 7/01/41 | | | |
| 1,410 | | Massachusetts Development Finance Agency, Hospital Revenue Bonds, Cape Cod Healthcare | 11/23 at 100.00 | A+ | 1,522,955 |
| | | Obligated Group, Series 2013, 5.250%, 11/15/41 | | | |
| 1,000 | | Massachusetts Development Finance Agency, Revenue Bonds, Baystate Medical Center Issue, | 7/24 at 100.00 | A+ | 1,066,730 |
| | | Series 2014N, 5.000%, 7/01/44 | | | |
| | | Massachusetts Development Finance Agency, Revenue Bonds, Berkshire Health Systems, | | | |
| | | Series 2012G: | | | |
| 895 | | 5.000%, 10/01/29 | 10/21 at 100.00 | AA– | 954,177 |
| 700 | | 5.000%, 10/01/31 | 10/21 at 100.00 | AA– | 745,101 |
| 500 | | Massachusetts Development Finance Agency, Revenue Bonds, Boston Medical Center Issue, | 7/26 at 100.00 | BBB | 547,040 |
| | | Series 2016E, 5.000%, 7/01/32 | | | |
| 1,675 | | Massachusetts Development Finance Agency, Revenue Bonds, CareGroup Issue, Refunding | 7/26 at 100.00 | A– | 1,852,165 |
| | | Series 2016-I, 5.000%, 7/01/30 | | | |
| | | Massachusetts Development Finance Agency, Revenue Bonds, CareGroup Issue, | | | |
| | | Series 2015H-1: | | | |
| 900 | | 5.000%, 7/01/30 | 7/25 at 100.00 | A– | 989,541 |
| 1,000 | | 5.000%, 7/01/32 | 7/25 at 100.00 | A– | 1,093,470 |
| 500 | | 5.000%, 7/01/33 | 7/25 at 100.00 | A– | 544,945 |
| 1,500 | | Massachusetts Development Finance Agency, Revenue Bonds, CareGroup Issue, Series | 7/28 at 100.00 | A– | 1,625,340 |
| | | 2018J-2, 5.000%, 7/01/38 | | | |
| 1,000 | | Massachusetts Development Finance Agency, Revenue Bonds, Covenant Health System | 7/22 at 100.00 | BBB+ | 1,053,070 |
| | | Obligated Group, Series 2012, 5.000%, 7/01/31 | | | |
21
| | |
NMT | Nuveen Massachusetts Quality Municipal Income Fund |
| | Portfolio of Investments (continued) |
| | November 30, 2018 (Unaudited) |
| | | | | | |
Principal | | | Optional Call | | |
Amount (000) | | Description (1) | Provisions (2) | Ratings (3) | Value |
| | | Health Care (continued) | | | |
| $ 2,800 | | Massachusetts Development Finance Agency, Revenue Bonds, Dana-Farber Cancer Institute | 12/26 at 100.00 | A1 | $ 3,051,048 |
| | | Issue, Series 2016N, 5.000%, 12/01/46 | | | |
| 3,500 | | Massachusetts Development Finance Agency, Revenue Bonds, Lahey Health System Obligated | 8/25 at 100.00 | A | 3,722,180 |
| | | Group Issue, Series 2015F, 5.000%, 8/15/45 | | | |
| 1,080 | | Massachusetts Development Finance Agency, Revenue Bonds, Milford Regional Medical Center | 7/23 at 100.00 | BBB– | 1,150,416 |
| | | Issue, Series 2014F, 5.750%, 7/15/43 | | | |
| 3,450 | | Massachusetts Development Finance Agency, Revenue Bonds, Partners HealthCare System | 7/26 at 100.00 | AA– | 3,746,630 |
| | | Issue, Series 2016Q, 5.000%, 7/01/47 | | | |
| | | Massachusetts Development Finance Agency, Revenue Bonds, Partners HealthCare System | | | |
| | | Issue, Series 2017S-1: | | | |
| 820 | | 5.000%, 7/01/37 | 1/28 at 100.00 | AA– | 912,480 |
| 2,100 | | 4.000%, 7/01/41 | 1/28 at 100.00 | AA– | 2,105,817 |
| 5 | | Massachusetts Development Finance Agency, Revenue Bonds, Partners HealthCare System, | 7/21 at 100.00 | AA– | 5,308 |
| | | Series 2012L, 5.000%, 7/01/36 | | | |
| 820 | | Massachusetts Development Finance Agency, Revenue Bonds, Southcoast Health System | 7/23 at 100.00 | BBB+ | 873,849 |
| | | Obligated Group Issue, Series 2013F, 5.000%, 7/01/37 | | | |
| | | Massachusetts Development Finance Agency, Revenue Bonds, The Lowell General Hospital, | | | |
| | | Series 2013G: | | | |
| 1,000 | | 5.000%, 7/01/37 | 7/23 at 100.00 | BBB+ | 1,051,390 |
| 2,200 | | 5.000%, 7/01/44 | 7/23 at 100.00 | BBB+ | 2,294,336 |
| 610 | | Massachusetts Development Finance Agency, Revenue Bonds, UMass Memorial Health Care | 1/27 at 100.00 | BBB+ | 659,886 |
| | | Obligated Group Issue, Series 2017K, 5.000%, 7/01/38 | | | |
| | | Massachusetts Development Finance Agency, Revenue Bonds, UMass Memorial Health Care | | | |
| | | Obligated Group Issue, Series 2017L: | | | |
| 400 | | 3.625%, 7/01/37 | 7/27 at 100.00 | BBB+ | 379,152 |
| 1,095 | | 5.000%, 7/01/44 | 7/27 at 100.00 | BBB+ | 1,172,548 |
| 445 | | Massachusetts Development Finance Agency, Revenue Bonds, UMass Memorial Health Care, | 7/26 at 100.00 | BBB+ | 483,577 |
| | | Series 2016I, 5.000%, 7/01/36 | | | |
| 25 | | Massachusetts Development Finance Agency, Revenue Bonds, UMass Memorial Health, Series | 7/21 at 100.00 | BBB+ | 26,647 |
| | | 2011H, 5.500%, 7/01/31 | | | |
| 2,500 | | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Dana-Farber | 12/18 at 100.00 | A1 | 2,506,525 |
| | | Cancer Institute, Series 2008K, 5.000%, 12/01/37 | | | |
| 1,495 | | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Milford | 2/19 at 100.00 | BBB– | 1,507,528 |
| | | Regional Medical Center, Series 2007E, 5.000%, 7/15/32 | | | |
| 37,765 | | Total Health Care | | | 40,157,326 |
| | | Housing/Multifamily – 1.4% (0.9% of Total Investments) | | | |
| 495 | | Boston Housing Authority, Massachusetts, Capital Program Revenue Bonds, Series 2008, | 2/19 at 100.00 | AA | 496,208 |
| | | 5.000%, 4/01/20 – AGM Insured | | | |
| 1,295 | | Massachusetts Housing Finance Agency, Housing Bonds, Series 2003H, 5.125%, 6/01/43 | 1/19 at 100.00 | AA | 1,306,681 |
| 1,790 | | Total Housing/Multifamily | | | 1,802,889 |
| | | Long-Term Care – 4.2% (2.7% of Total Investments) | | | |
| | | Massachusetts Development Finance Agency Revenue Refunding Bonds, NewBridge on the | | | |
| | | Charles, Inc. Issue, Series 2017: | | | |
| 1,040 | | 4.125%, 10/01/42, 144A | 10/22 at 105.00 | N/R | 904,894 |
| 250 | | 5.000%, 10/01/47, 144A | 10/22 at 105.00 | N/R | 253,368 |
| 460 | | Massachusetts Development Finance Agency, Revenue Bonds, Berkshire Retirement Community | 7/25 at 100.00 | A | 501,892 |
| | | Lennox, Series 2015, 5.000%, 7/01/31 | | | |
| 285 | | Massachusetts Development Finance Agency, Revenue Bonds, Carleton-Willard Village, | 12/19 at 100.00 | A– | 292,849 |
| | | Series 2010, 5.625%, 12/01/30 | | | |
22
| | | | | | |
Principal | | | Optional Call | | |
Amount (000) | | Description (1) | Provisions (2) | Ratings (3) | Value |
| | | Long-Term Care (continued) | | | |
| $ 1,000 | | Massachusetts Development Finance Agency, Revenue Bonds, Loomis Communities, Series | 1/23 at 100.00 | BBB | $ 1,078,900 |
| | | 2013A, 5.250%, 1/01/26 | | | |
| 2,410 | | Massachusetts Development Finance Agency, Revenue Bonds, Orchard Cove, Series 2007, | 4/19 at 100.00 | N/R | 2,414,073 |
| | | 5.250%, 10/01/26 | | | |
| 5,445 | | Total Long-Term Care | | | 5,445,976 |
| | | Tax Obligation/General – 14.6% (9.4% of Total Investments) | | | |
| 1,250 | | Hudson, Massachusetts, General Obligation Bonds, Municipal Purpose Loan Series 2011, | 2/20 at 100.00 | AA | 1,291,388 |
| | | 5.000%, 2/15/32 | | | |
| 930 | | Massachusetts Bay Transportation Authority, General Obligation Transportation System | No Opt. Call | Aa1 | 983,931 |
| | | Bonds, Series 1991A, 7.000%, 3/01/21 | | | |
| 1,500 | | Massachusetts State, General Obligation Bonds, Consolidated Loan, Series 2004B, 5.250%, | No Opt. Call | Aa1 | 1,625,550 |
| | | 8/01/21 – AGM Insured | | | |
| 2,000 | | Massachusetts State, General Obligation Bonds, Consolidated Loan, Series 2015C, | 7/25 at 100.00 | Aa1 | 2,189,540 |
| | | 5.000%, 7/01/45 | | | |
| 3,895 | | Massachusetts State, General Obligation Bonds, Consolidated Loan, Series 2017F, | 11/27 at 100.00 | Aa1 | 4,364,035 |
| | | 5.000%, 11/01/46 | | | |
| 1,775 | | North Reading, Massachusetts, General Obligation Bonds, Municipal Purpose Loan Series | 5/22 at 100.00 | Aa2 | 1,924,331 |
| | | 2012, 5.000%, 5/15/35 – AMBAC Insured | | | |
| 1,760 | | Norwell, Massachusetts, General Obligation Bonds, Series 2003, 5.000%, 11/15/20 – | No Opt. Call | AAA | 1,835,698 |
| | | FGIC Insured | | | |
| | | Quincy, Massachusetts, General Obligation Bonds, State Qualified Municipal Purpose Loan | | | |
| | | Series 2011: | | | |
| 1,280 | | 5.125%, 12/01/33 | 12/20 at 100.00 | Aa2 | 1,352,051 |
| 2,000 | | 5.250%, 12/01/38 | 12/20 at 100.00 | Aa2 | 2,120,240 |
| 1,220 | | Worcester, Massachusetts, General Obligation Bonds, Series 2005A, 5.000%, 7/01/19 – | 2/19 at 100.00 | AA | 1,223,026 |
| | | FGIC Insured | | | |
| 17,610 | | Total Tax Obligation/General | | | 18,909,790 |
| | | Tax Obligation/Limited – 18.2% (11.8% of Total Investments) | | | |
| | | Government of Guam, Business Privilege Tax Bonds, Series 2011A: | | | |
| 2,000 | | 5.250%, 1/01/36 | 1/22 at 100.00 | A | 2,094,880 |
| 1,310 | | 5.125%, 1/01/42 | 1/22 at 100.00 | A | 1,348,553 |
| | | Government of Guam, Business Privilege Tax Bonds, Series 2012B-1: | | | |
| 400 | | 5.000%, 1/01/37 | 1/22 at 100.00 | A | 411,460 |
| 1,115 | | 5.000%, 1/01/42 | 1/22 at 100.00 | A | 1,142,853 |
| 855 | | Martha’s Vineyard Land Bank, Massachusetts, Revenue Bonds, Refunding Green Series 2014, | 11/24 at 100.00 | AA | 959,225 |
| | | 5.000%, 5/01/33 – BAM Insured | | | |
| 500 | | Martha’s Vineyard Land Bank, Massachusetts, Revenue Bonds, Refunding Green Series 2017, | 5/27 at 100.00 | AA | 566,665 |
| | | 5.000%, 5/01/35 – BAM Insured | | | |
| 1,000 | | Massachusetts Bay Transportation Authority, Assessment Bonds, Series 2012A, | 7/22 at 100.00 | AAA | 1,079,280 |
| | | 5.000%, 7/01/41 | | | |
| 770 | | Massachusetts Bay Transportation Authority, Sales Tax Revenue Bonds, Refunding Senior | No Opt. Call | AA | 832,693 |
| | | Lien Series 2004C, 5.250%, 7/01/21 | | | |
| 1,610 | | Massachusetts College Building Authority, Project Revenue Bonds, Green Series 2014B, | 5/24 at 100.00 | Aa2 | 1,759,521 |
| | | 5.000%, 5/01/44 | | | |
| 1,000 | | Massachusetts College Building Authority, Project Revenue Refunding Bonds, Series 2003B, | No Opt. Call | Aa2 | 1,134,480 |
| | | 5.375%, 5/01/23 – SYNCORA GTY Insured | | | |
| 855 | | Massachusetts College Building Authority, Revenue Bonds, Refunding Series 2012B, | 5/22 at 100.00 | Aa2 | 916,586 |
| | | 5.000%, 5/01/37 | | | |
23
| | |
NMT | Nuveen Massachusetts Quality Municipal Income Fund |
| | Portfolio of Investments (continued) |
| | November 30, 2018 (Unaudited) |
| | | | | | |
Principal | | | Optional Call | | |
Amount (000) | | Description (1) | Provisions (2) | Ratings (3) | Value |
| | | Tax Obligation/Limited (continued) | | | |
| $ 1,350 | | Massachusetts School Building Authority, Dedicated Sales Tax Revenue Bonds, Senior | 8/25 at 100.00 | AAA | $ 1,510,056 |
| | | Refunding Series 2015C, 5.000%, 8/15/37 | | | |
| 1,875 | | Massachusetts School Building Authority, Dedicated Sales Tax Revenue Bonds, Senior | 5/23 at 100.00 | AAA | 2,051,250 |
| | | Series 2013A, 5.000%, 5/15/38 | | | |
| 1,000 | | Massachusetts School Building Authority, Dedicated Sales Tax Revenue Bonds, Series | 10/21 at 100.00 | AAA | 1,064,080 |
| | | 2011B, 5.000%, 10/15/41 | | | |
| 2,000 | | Massachusetts School Building Authority, Dedicated Sales Tax Revenue Bonds, Subordinated | 2/28 at 100.00 | AA+ | 2,278,160 |
| | | Series 2018A, 5.250%, 2/15/48 | | | |
| 1,070 | | Massachusetts State, Special Obligation Dedicated Tax Revenue Bonds, Series 2005, | No Opt. Call | A1 | 1,104,304 |
| | | 5.000%, 1/01/20 – FGIC Insured | | | |
| 1,500 | | Massachusetts State, Transportation Fund Revenue Bonds, Rail Enhancement Program, Series | 6/25 at 100.00 | AA+ | 1,658,985 |
| | | 2015A, 5.000%, 6/01/45 | | | |
| 520 | | Virgin Islands Public Finance Authority, Gross Receipts Taxes Loan Note, Refunding | 10/22 at 100.00 | AA | 555,053 |
| | | Series 2012A, 5.000%, 10/01/32 – AGM Insured | | | |
| 1,000 | | Virgin Islands Public Finance Authority, Matching Fund Loan Notes Revenue Bonds, Series | 10/22 at 100.00 | AA | 1,067,410 |
| | | 2012A, 5.000%, 10/01/32 – AGM Insured | | | |
| 21,730 | | Total Tax Obligation/Limited | | | 23,535,494 |
| | | Transportation – 11.2% (7.2% of Total Investments) | | | |
| 400 | | Massachusetts Department of Transportation, Metropolitan Highway System Revenue Bonds, | 1/20 at 100.00 | AA+ | 411,956 |
| | | Commonwealth Contract Assistance Secured, Refunding Series 2010B, 5.000%, 1/01/35 | | | |
| 2,500 | | Massachusetts Port Authority, Revenue Bonds, Refunding Series 2017A, 5.000%, 7/01/47 | 7/27 at 100.00 | AA | 2,729,200 |
| | | (Alternative Minimum Tax) | | | |
| 1,000 | | Massachusetts Port Authority, Revenue Bonds, Series 2010A, 5.000%, 7/01/30 | 7/20 at 100.00 | AA | 1,046,270 |
| 1,000 | | Massachusetts Port Authority, Revenue Bonds, Series 2012B, 5.000%, 7/01/33 | 7/22 at 100.00 | AA | 1,089,980 |
| | | Massachusetts Port Authority, Revenue Bonds, Series 2014A: | | | |
| 1,000 | | 5.000%, 7/01/39 | 7/24 at 100.00 | AA | 1,097,640 |
| 2,500 | | 5.000%, 7/01/44 | 7/24 at 100.00 | AA | 2,730,725 |
| | | Massachusetts Port Authority, Revenue Bonds, Series 2015A: | | | |
| 715 | | 5.000%, 7/01/40 | 7/25 at 100.00 | AA | 791,641 |
| 1,000 | | 5.000%, 7/01/45 | 7/25 at 100.00 | AA | 1,102,830 |
| 1,400 | | Massachusetts Port Authority, Special Facilities Revenue Bonds, BOSFUEL Corporation, | 2/19 at 100.00 | A1 | 1,403,416 |
| | | Series 2007, 5.000%, 7/01/32 – FGIC Insured (Alternative Minimum Tax) | | | |
| 1,225 | | Massachusetts Port Authority, Special Facilities Revenue Bonds, Delta Air Lines Inc., | 1/19 at 100.00 | N/R | 1,247,895 |
| | | Series 2001A, 5.000%, 1/01/27 – AMBAC Insured (Alternative Minimum Tax) | | | |
| 730 | | Metropolitan Boston Transit Parking Corporation, Massachusetts, Systemwide Parking | 7/21 at 100.00 | A+ | 768,683 |
| | | Revenue Bonds, Senior Lien Series 2011, 5.000%, 7/01/41 | | | |
| 13,470 | | Total Transportation | | | 14,420,236 |
| | | U.S. Guaranteed – 20.9% (13.5% of Total Investments) (5) | | | |
| 500 | | Boston Water and Sewer Commission, Massachusetts, General Revenue Bonds, Refunding | 11/19 at 100.00 | AA+ | 513,975 |
| | | Senior Lien Series 2010A, 5.000%, 11/01/30 (Pre-refunded 11/01/19) | | | |
| 2,580 | | Guam Power Authority, Revenue Bonds, Series 2010A, 5.000%, 10/01/37 – AGM Insured | 10/20 at 100.00 | AA | 2,720,816 |
| | | (Pre-refunded 10/01/20) | | | |
| 2,000 | | Hampden-Wilbraham Regional School District, Hampden County, Massachusetts, General | 2/21 at 100.00 | Aa3 | 2,130,080 |
| | | Obligation Bonds, Series 2011, 5.000%, 2/15/41 (Pre-refunded 2/15/21) | | | |
| 750 | | Massachusetts Development Finance Agency, Revenue Bonds, Boston University, Series | 10/19 at 100.00 | Aa3 | 769,425 |
| | | 2009V-1, 5.000%, 10/01/29 (Pre-refunded 10/01/19) | | | |
| | | Massachusetts Development Finance Agency, Revenue Bonds, Emerson College, Series 2010A: | | | |
| 1,275 | | 5.000%, 1/01/40 (Pre-refunded 1/01/20) | 1/20 at 100.00 | N/R | 1,317,534 |
| 125 | | 5.000%, 1/01/40 (Pre-refunded 1/01/20) | 1/20 at 100.00 | BBB+ | 129,170 |
24
| | | | | | |
Principal | | | Optional Call | | |
Amount (000) | | Description (1) | Provisions (2) | Ratings (3) | Value |
| | | U.S. Guaranteed (5) (continued) | | | |
| $ 467 | | Massachusetts Development Finance Agency, Revenue Bonds, North Hill Communities Issue, | 11/23 at 100.00 | N/R | $ 537,354 |
| | | Series 2013A, 6.250%, 11/15/28, 144A (Pre-refunded 11/15/23) | | | |
| 2,200 | | Massachusetts Development Finance Agency, Revenue Bonds, Partners HealthCare System, | 7/20 at 100.00 | AA– | 2,313,828 |
| | | Series 2011K-6, 5.375%, 7/01/41 (Pre-refunded 7/01/20) | | | |
| 995 | | Massachusetts Development Finance Agency, Revenue Bonds, Partners HealthCare System, | 7/21 at 100.00 | N/R | 1,065,914 |
| | | Series 2012L, 5.000%, 7/01/36 (Pre-refunded 7/01/21) | | | |
| 1,000 | | Massachusetts Development Finance Agency, Revenue Bonds, Sterling and Francine Clark Art | 7/21 at 100.00 | AA | 1,073,870 |
| | | Institute, Series 2011A, 5.000%, 7/01/41 (Pre-refunded 7/01/21) | | | |
| 3,000 | | Massachusetts Development Finance Agency, Revenue Bonds, The Broad Institute, Series | 4/21 at 100.00 | AA– | 3,218,910 |
| | | 2011A, 5.250%, 4/01/37 (Pre-refunded 4/01/21) | | | |
| 475 | | Massachusetts Development Finance Agency, Revenue Bonds, UMass Memorial Health, Series | 7/21 at 100.00 | N/R | 514,772 |
| | | 2011H, 5.500%, 7/01/31 (Pre-refunded 7/01/21) | | | |
| 160 | | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Baystate | 7/19 at 100.00 | N/R | 163,624 |
| | | Medical Center, Series 2009I, 5.750%, 7/01/36 (Pre-refunded 7/01/19) | | | |
| 500 | | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Cape Cod | 11/19 at 100.00 | AA | 515,155 |
| | | Healthcare Obligated Group, Series 2004D, 5.125%, 11/15/35 – AGC Insured | | | |
| | | (Pre-refunded 11/15/19) | | | |
| 410 | | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, CareGroup | 7/21 at 100.00 | N/R | 432,878 |
| | | Inc., Series 1998A, 5.000%, 7/01/25 – NPFG Insured (Pre-refunded 7/01/21) | | | |
| 2,000 | | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Children’s | 12/19 at 100.00 | Aa2 | 2,069,600 |
| | | Hospital, Series 2009M, 5.500%, 12/01/39 (Pre-refunded 12/01/19) | | | |
| 1,500 | | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Springfield | 10/19 at 100.00 | N/R | 1,546,410 |
| | | College, Series 2010, 5.500%, 10/15/31 (Pre-refunded 10/15/19) | | | |
| 335 | | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Suffolk | 7/19 at 100.00 | N/R | 342,588 |
| | | University, Refunding Series 2009A, 5.750%, 7/01/39 (Pre-refunded 7/01/19) | | | |
| 2,030 | | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Wheaton | 1/20 at 100.00 | A3 | 2,097,721 |
| | | College Issues, Series 2010F, 5.000%, 1/01/41 (Pre-refunded 1/01/20) | | | |
| 1,500 | | Massachusetts State, Transportation Fund Revenue Bonds, Rail Enhancement Program, Series | 6/21 at 100.00 | AA+ | 1,609,230 |
| | | 2013A, 5.000%, 6/01/38 (Pre-refunded 6/01/21) | | | |
| 1,065 | | Puerto Rico, Highway Revenue Bonds, Highway and Transportation Authority, Series 2003AA, | No Opt. Call | Baa2 | 1,086,683 |
| | | 5.500%, 7/01/19 – NPFG Insured (ETM) | | | |
| 720 | | Springfield Water and Sewer Commission, Massachusetts, General Revenue Bonds, Refunding | 11/20 at 100.00 | AA | 762,034 |
| | | Series 2010B, 5.000%, 11/15/30 – AGC Insured (Pre-refunded 11/15/20) | | | |
| 25,587 | | Total U.S. Guaranteed | | | 26,931,571 |
| | | Utilities – 1.1% (0.7% of Total Investments) | | | |
| 1,265 | | Massachusetts Clean Energy Cooperative Corporation, Revenue Bonds, Massachusetts | 7/23 at 100.00 | A1 | 1,396,282 |
| | | Municipal Lighting Plant Cooperative, Series 2013, 5.000%, 7/01/32 | | | |
| | | Water and Sewer – 8.2% (5.3% of Total Investments) | | | |
| 565 | | Guam Government Waterworks Authority, Water and Wastewater System Revenue Bonds, | 7/24 at 100.00 | A– | 600,974 |
| | | Refunding Series 2014A, 5.000%, 7/01/29 | | | |
| 1,250 | | Guam Government Waterworks Authority, Water and Wastewater System Revenue Bonds, | 7/27 at 100.00 | A– | 1,321,713 |
| | | Refunding Series 2017, 5.000%, 7/01/37 | | | |
| 420 | | Guam Government Waterworks Authority, Water and Wastewater System Revenue Bonds, Series | 7/26 at 100.00 | A– | 436,388 |
| | | 2016, 5.000%, 1/01/46 | | | |
| 415 | | Lynn Water and Sewer Commission, Massachusetts, General Revenue Bonds, Series 2003A, | 2/19 at 100.00 | A1 | 416,017 |
| | | 5.000%, 12/01/32 – NPFG Insured | | | |
| 2,300 | | Massachusetts Clean Water Trust, State Revolving Fund Bonds, Green 18 Series 2015, | 2/24 at 100.00 | AAA | 2,540,212 |
| | | 5.000%, 2/01/45 | | | |
25
| | |
NMT | Nuveen Massachusetts Quality Municipal Income Fund |
| | Portfolio of Investments (continued) |
| | November 30, 2018 (Unaudited) |
| | | | | | |
Principal | | | Optional Call | | |
Amount (000) | | Description (1) | Provisions (2) | Ratings (3) | Value |
| | | Water and Sewer (continued) | | | |
| $ 60 | | Massachusetts Water Pollution Abatement Trust, Pooled Loan Program Bonds, Series 2003-9, | 2/19 at 100.00 | AAA | $ 60,152 |
| | | 5.000%, 8/01/22 | | | |
| 140 | | Massachusetts Water Pollution Abatement Trust, Revenue Bonds, MWRA Loan Program, Series | 2/19 at 100.00 | AAA | 140,391 |
| | | 2002A, 5.250%, 8/01/20 | | | |
| | | Massachusetts Water Resources Authority, General Revenue Bonds, Refunding Series 2016B: | | | |
| 455 | | 5.000%, 8/01/40 | 8/26 at 100.00 | AA+ | 508,581 |
| 1,000 | | 4.000%, 8/01/40 | 8/26 at 100.00 | AA+ | 1,021,150 |
| 1,000 | | Massachusetts Water Resources Authority, General Revenue Bonds, Series 2002J, 5.250%, | No Opt. Call | AA+ | 1,022,390 |
| | | 8/01/19 – AGM Insured | | | |
| 1,230 | | Massachusetts Water Resources Authority, General Revenue Bonds, Series 2017B, | 8/27 at 100.00 | AA+ | 1,389,273 |
| | | 5.000%, 8/01/42 | | | |
| 1,000 | | Springfield Water and Sewer Commission, Massachusetts, General Revenue Bonds, Series | 4/27 at 100.00 | AA | 1,137,420 |
| | | 2017C, 5.000%, 4/15/37 | | | |
| 9,835 | | Total Water and Sewer | | | 10,594,661 |
| $ 184,787 | | Total Long-Term Investments (cost $194,681,302) | | | 199,935,923 |
| | | Variable Rate Demand Preferred Shares, net of deferred offering costs – (57.1)% (6) | | | (73,724,369) |
| | | Other Assets Less Liabilities – 2.2% | | | 2,889,874 |
| | | Net Assets Applicable to Common Shares – 100% | | | $ 129,101,428 |
| | |
| (1) | All percentages shown in the Portfolio of Investments are based on net assets applicable to common shares unless otherwise noted. |
| (2) | Optional Call Provisions: Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. Certain mortgage-backed securities may be subject to periodic principal paydowns. |
| (3) | For financial reporting purposes, the ratings disclosed are the highest of Standard & Poor’s Group (“Standard & Poor’s”), Moody’s Investors Service, Inc. (“Moody’s”) or Fitch, Inc. (“Fitch”) rating. This treatment of split-rated securities may differ from that used for other purposes, such as for Fund investment policies. Ratings below BBB by Standard & Poor’s, Baa by Moody’s or BBB by Fitch are considered to be below investment grade. Holdings designated N/R are not rated by any of these national rating agencies. |
| (4) | Investment, or portion of investment, has been pledged to collateralize the net payment obligations for investments in inverse floating rate transactions. |
| (5) | Backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities, which ensure the timely payment of principal and interest. |
| (6) | Variable Rate Demand Preferred Shares, net of deferred offering costs as a percentage of Total Investments is 36.9%. |
| 144A | Investment is exempt from registration under Rule 144A of the Securities Act of 1933, as amended. These investments may only be resold in transactions exempt from registration, which are normally those transactions with qualified institutional buyers. |
| ETM | Escrowed to maturity. |
| IF | Inverse floating rate security issued by a tender option bond (“TOB”) trust, the interest rate on which varies inversely with the Securities Industry Financial Markets Association (SIFMA) short-term rate, which resets weekly, or a similar short-term rate, and is reduced by the expenses related to the TOB trust. |
See accompanying notes to financial statements.
26
| |
| Statement of Assets and Liabilities |
| November 30, 2018 (Unaudited) |
| | | | | | | |
| | | NTC | | | NMT | |
Assets | | | | | | |
| Long-term investments, at value (cost $303,370,290 and $194,681,302, respectively) | | $ | 306,464,629 | | | $ | 199,935,923 | |
| Cash | | | 2,148,469 | | | | 422,849 | |
| Receivable for: | | | | | | | | |
| Interest | | | 4,347,825 | | | | 3,013,201 | |
| Investments sold | | | 1,402,341 | | | | — | |
| Other assets | | | 20,827 | | | | 4,060 | |
| Total assets | | | 314,384,091 | | | | 203,376,033 | |
Liabilities | | | | | | | | |
| Floating rate obligations | | | 6,375,000 | | | | — | |
| Payable for: | | | | | | | | |
| Dividends | | | 557,920 | | | | 370,986 | |
| Interest | | | 237,317 | | | | — | |
| Investments purchased | | | 3,101,783 | | | | — | |
| Variable Rate MuniFund Term Preferred (“VMTP”) Shares, net of deferred offering costs | | | | | | | | |
| (liquidation preference $112,000,000 and $—, respectively) | | | 111,994,257 | | | | — | |
| Variable Rate Demand Preferred (“VRDP”) Shares, net of deferred offering costs | | | | | | | | |
| (liquidation preference $— and $74,000,000, respectively) | | | — | | | | 73,724,369 | |
| Accrued expenses: | | | | | | | | |
| Management fees | | | 154,648 | | | | 104,028 | |
| Trustees fees | | | 19,282 | | | | 850 | |
| Other | | | 61,281 | | | | 74,372 | |
| Total liabilities | | | 122,501,488 | | | | 74,274,605 | |
| Net assets applicable to common shares | | $ | 191,882,603 | | | $ | 129,101,428 | |
| Common shares outstanding | | | 14,371,977 | | | | 9,322,999 | |
| Net asset value (“NAV”) per common share outstanding | | $ | 13.35 | | | $ | 13.85 | |
Net assets applicable to common shares consist of: | | | | | | | | |
| Common shares, $0.01 par value per share | | $ | 143,720 | | | $ | 93,230 | |
| Paid-in surplus | | | 198,644,379 | | | | 129,306,586 | |
| Total distributable earnings | | | (6,905,496 | ) | | | (298,388 | ) |
| Net assets applicable to common shares | | $ | 191,882,603 | | | $ | 129,101,428 | |
| Authorized shares: | | | | | | | | |
| Common | | Unlimited | | | Unlimited | |
| Preferred | | Unlimited | | | Unlimited | |
See accompanying notes to financial statements.
27
| |
| Statement of Operations |
| Six Months Ended November 30, 2018 (Unaudited) |
| | | | | | | |
| | | NTC | | | NMT | |
Investment Income | | $ | 6,015,294 | | | $ | 4,061,271 | |
Expenses | | | | | | | | |
| Management fees | | | 953,919 | | | | 642,572 | |
| Interest expense and amortization of offering costs | | | 1,387,304 | | | | 807,159 | |
| Custodian fees | | | 20,028 | | | | 16,648 | |
| Trustees fees | | | 4,559 | | | | 3,046 | |
| Professional fees | | | 15,336 | | | | 113,231 | |
| Shareholder reporting expenses | | | 14,439 | | | | 8,747 | |
| Shareholder servicing agent fees | | | 9,179 | | | | 478 | |
| Stock exchange listing fees | | | 3,395 | | | | 3,396 | |
| Investor relations expenses | | | 9,789 | | | | 6,734 | |
| Other | | | 20,538 | | | | 20,369 | |
| Total expenses | | | 2,438,486 | | | | 1,622,380 | |
| Net investment income (loss) | | | 3,576,808 | | | | 2,438,891 | |
Realized and Unrealized Gain (Loss) | | | | | | | | |
| Net realized gain (loss) from investments | | | (387,528 | ) | | | (836,695 | ) |
| Change in net unrealized appreciation (depreciation) of investments | | | (4,126,800 | ) | | | (3,269,360 | ) |
| Net realized and unrealized gain (loss) | | | (4,514,328 | ) | | | (4,106,055 | ) |
| Net increase (decrease) in net assets applicable to common shares from operations | | $ | (937,520 | ) | | $ | (1,667,164 | ) |
See accompanying notes to financial statements.
28
| |
| Statement of Changes in Net Assets |
| (Unaudited) |
| | | | | | | | | | | | | |
| | | NTC | | | NMT | |
| | | Six Months | | | Year(1) | | | Six Months | | | Year(1) | |
| | | Ended | | | Ended | | | Ended | | | Ended | |
| | | 11/30/18 | | | 5/31/18 | | | 11/30/18 | | | 5/31/18 | |
Operations | | | | | | | | | | | | |
| Net investment income (loss) | | $ | 3,576,808 | | | $ | 7,452,636 | | | $ | 2,438,891 | | | $ | 5,482,300 | |
| Net realized gain (loss) from investments | | | (387,528 | ) | | | (450,839 | ) | | | (836,695 | ) | | | 137,549 | |
| Change in net unrealized appreciation | | | | | | | | | | | | | | | | |
| (depreciation) of investments | | | (4,126,800 | ) | | | (6,611,292 | ) | | | (3,269,360 | ) | | | (3,940,236 | ) |
| Net increase (decrease) in net assets | | | | | | | | | | | | | | | | |
| applicable to common shares | | | | | | | | | | | | | | | | |
| from operations | | | (937,520 | ) | | | 390,505 | | | | (1,667,164 | ) | | | 1,679,613 | |
Distributions to Common Shareholders(2) | | | | | | | | | | | | | | | | |
Dividends(3) | | | (3,546,672 | ) | | | (7,654,756 | ) | | | (2,396,480 | ) | | | (5,861,517 | ) |
| Decrease in net assets applicable to | | | | | | | | | | | | | | | | |
| common shares from distributions | | | | | | | | | | | | | | | | |
| to common shareholders | | | (3,546,672 | ) | | | (7,654,756 | ) | | | (2,396,480 | ) | | | (5,861,517 | ) |
Capital Share Transactions | | | | | | | | | | | | | | | | |
| Common shares: | | | | | | | | | | | | | | | | |
| Net proceeds from shares issued | | | | | | | | | | | | | | | | |
| to shareholders due to | | | | | | | | | | | | | | | | |
| reinvestment of distributions | | | — | | | | — | | | | — | | | | 10,822 | |
| Cost of shares repurchased and retired | | | (630,569 | ) | | | (1,242,632 | ) | | | (302,872 | ) | | | — | |
| Net increase (decrease) in net assets | | | | | | | | | | | | | | | | |
| applicable to common shares | | | | | | | | | | | | | | | | |
| from capital share transactions | | | (630,569 | ) | | | (1,242,632 | ) | | | (302,872 | ) | | | 10,822 | |
| Net increase (decrease) in net assets | | | | | | | | | | | | | | | | |
| applicable to common shares | | | (5,114,761 | ) | | | (8,506,883 | ) | | | (4,366,516 | ) | | | (4,171,082 | ) |
| Net assets applicable to common | | | | | | | | | | | | | | | | |
| shares at the beginning of period | | | 196,997,364 | | | | 205,504,247 | | | | 133,467,944 | | | | 137,639,026 | |
| Net assets applicable to common | | | | | | | | | | | | | | | | |
| shares at the end of period | | $ | 191,882,603 | | | $ | 196,997,364 | | | $ | 129,101,428 | | | $ | 133,467,944 | |
| | |
| (1) | Prior period amounts have been conformed to current year presentation. See Notes to Financial Statements, Note 9 – New Accounting Pronouncements for further details. |
| (2) | The composition and per share amounts of the Funds’ distributions are presented in the Financial Highlights. The distribution information for the Funds as of its most recent tax year end is presented within the Notes to Financial Statements, Note 6 – Income Tax Information. |
| (3) | For the fiscal year ended May 31, 2018 the Funds' distributions to shareholders were paid from net investment income. |
See accompanying notes to financial statements.
29
| |
| Statement of Cash Flows |
| Six Months Ended November 30, 2018 (Unaudited) |
| | | | | | | |
| | | NTC | | | NMT | |
Cash Flows from Operating Activities: | | | | | | |
Net Increase (Decrease) in Net Assets Applicable to Common Shares from Operations | | $ | (937,520 | ) | | $ | (1,667,164 | ) |
| Adjustments to reconcile the net increase (decrease) in net assets applicable to common shares from operations | | | | | | | | |
| to net cash provided by (used in) operating activities: | | | | | | | | |
| Purchases of investments | | | (17,534,670 | ) | | | (21,904,904 | ) |
| Proceeds from sales and maturities of investments | | | 16,892,348 | | | | 21,623,148 | |
| Taxes paid | | | (412 | ) | | | — | |
| Amortization (Accretion) of premiums and discounts, net | | | 1,281,813 | | | | 725,610 | |
| Amortization of deferred offering costs | | | 3,825 | | | | 4,888 | |
| (Increase) Decrease in: | | | | | | | | |
| Receivable for interest | | | 92,553 | | | | (42,100 | ) |
| Receivable for investments sold | | | (1,267,341 | ) | | | — | |
| Other assets | | | (767 | ) | | | 5,331 | |
| Increase (Decrease) in: | | | | | | | | |
| Payable for interest | | | 12,427 | | | | — | |
| Payable for investments purchased | | | 3,101,783 | | | | — | |
| Accrued management fees | | | (7,545 | ) | | | (5,595 | ) |
| Accrued Trustees fees | | | 866 | | | | (1,467 | ) |
| Accrued other expenses | | | (22,601 | ) | | | (31,059 | ) |
| Net realized (gain) loss from investments | | | 387,528 | | | | 836,695 | |
| Change in net unrealized (appreciation) depreciation of investments | | | 4,126,800 | | | | 3,269,360 | |
| Net cash provided by (used in) operating activities | | | 6,129,087 | | | | 2,812,743 | |
Cash Flows from Financing Activities: | | | | | | | | |
| Cash distributions paid to common shareholders | | | (3,563,702 | ) | | | (2,477,955 | ) |
| Cost of common shares repurchased and retired | | | (630,569 | ) | | | (302,872 | ) |
| Net cash provided by (used in) financing activities | | | (4,194,271 | ) | | | (2,780,827 | ) |
Net Increase (Decrease) in Cash | | | 1,934,816 | | | | 31,916 | |
| Cash at the beginning of period | | | 213,653 | | | | 390,933 | |
| Cash at the end of period | | $ | 2,148,469 | | | $ | 422,849 | |
| | |
Supplemental Disclosure of Cash Flow Information | | NTC | | | NMT | |
| Cash paid for interest (excluding amortization of offering costs) | | $ | 1,374,877 | | | $ | 807,159 | |
See accompanying notes to financial statements.
30
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31
| |
| Financial Highlights (Unaudited) |
Selected data for a common share outstanding throughout each period:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | Investment Operations | | | Less Distributions to Common Shareholders | | | Common Share | |
| | | | | | | | | | | | | | | | | | From | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | Accum- | | | | | | Discount | | | | | | | |
| | | Beginning | | | Net | | | Net | | | | | | From | | | ulated | | | | | | Per | | | | | | | |
| | | Common | | | Investment | | | Realized/ | | | | | | Net | | | Net | | | | | | Share | | | | | | Ending | |
| | | Share | | | Income | | | Unrealized | | | | | | Investment | | | Realized | | | | | | Repurchased | | | Ending | | | Share | |
| | | NAV | | | (Loss) | | | Gain (Loss) | | | Total | | | Income | | | Gains | | | Total | | | and Retired | | | NAV | | | Price | |
NTC | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Year Ended 5/31: | | | | | | | | | | | | | | | | | | | | | | | | | |
| 2019(e) | | $ | 13.65 | | | $ | 0.25 | | | $ | (0.31 | ) | | $ | (0.06 | ) | | $ | (0.25 | ) | | $ | — | | | $ | (0.25 | ) | | $ | 0.01 | | | $ | 13.35 | | | $ | 11.23 | |
| 2018 | | | 14.14 | | | | 0.51 | | | | (0.49 | ) | | | 0.02 | | | | (0.53 | ) | | | — | | | | (0.53 | ) | | | 0.02 | | | | 13.65 | | | | 11.75 | |
| 2017 | | | 14.92 | | | | 0.57 | | | | (0.73 | ) | | | (0.16 | ) | | | (0.62 | ) | | | — | | | | (0.62 | ) | | | — | | | | 14.14 | | | | 12.47 | |
| 2016 | | | 14.35 | | | | 0.67 | | | | 0.59 | | | | 1.26 | | | | (0.69 | ) | | | — | | | | (0.69 | ) | | | — | | | | 14.92 | | | | 13.54 | |
| 2015 | | | 14.33 | | | | 0.70 | | | | (0.01 | ) | | | 0.69 | | | | (0.68 | ) | | | — | | | | (0.68 | ) | | | 0.01 | | | | 14.35 | | | | 12.62 | |
| 2014 | | | 15.00 | | | | 0.60 | | | | (0.59 | ) | | | 0.01 | | | | (0.68 | ) | | | — | * | | | (0.68 | ) | | | — | * | | | 14.33 | | | | 12.68 | |
| | |
NMT | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Year Ended 5/31: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 2019(e) | | | 14.28 | | | | 0.26 | | | | (0.44 | ) | | | (0.18 | ) | | | (0.26 | ) | | | — | | | | (0.26 | ) | | | 0.01 | | | | 13.85 | | | | 12.15 | |
| 2018 | | | 14.72 | | | | 0.59 | | | | (0.40 | ) | | | 0.19 | | | | (0.63 | ) | | | — | | | | (0.63 | ) | | | — | | | | 14.28 | | | | 12.64 | |
| 2017 | | | 15.34 | | | | 0.64 | | | | (0.58 | ) | | | 0.06 | | | | (0.68 | ) | | | — | | | | (0.68 | ) | | | — | | | | 14.72 | | | | 13.90 | |
| 2016 | | | 14.67 | | | | 0.69 | | | | 0.69 | | | | 1.38 | | | | (0.71 | ) | | | — | | | | (0.71 | ) | | | — | | | | 15.34 | | | | 14.99 | |
| 2015 | | | 14.65 | | | | 0.65 | | | | 0.05 | | | | 0.70 | | | | (0.68 | ) | | | — | | | | (0.68 | ) | | | — | | | | 14.67 | | | | 13.14 | |
| 2014 | | | 15.12 | | | | 0.58 | | | | (0.37 | ) | | | 0.21 | | | | (0.67 | ) | | | (0.01 | ) | | | (0.68 | ) | | | — | | | | 14.65 | | | | 13.33 | |
| | |
| (a) | Total Return Based on Common Share NAV is the combination of changes in common share NAV, reinvested dividend income at NAV and reinvested capital gains distributions at NAV, if any. The last dividend declared in the period, which is typically paid on the first business day of the following month, is assumed to be reinvested at the ending NAV. The actual reinvest price for the last dividend declared in the period may often be based on the Fund’s market price (and not its NAV), and therefore may be different from the price used in the calculation. Total returns are not annualized. Total Return Based on Common Share Price is the combination of changes in the market price per share and the effect of reinvested dividend income and reinvested capital gains distributions, if any, at the average price paid per share at the time of reinvestment. The last dividend declared in the period, which is typically paid on the first business day of the following month, is assumed to be reinvested at the ending market price. The actual reinvestment for the last dividend declared in the period may take place over several days, and in some instances may not be based on the market price, so the actual reinvestment price may be different from the price used in the calculation. Total returns are not annualized. |
32
| | | | | | | | | | | | | | | | |
| | | | | | | Common Share Supplemental Data/ | |
| | | | | | | Ratios Applicable to Common Shares | |
Common Share Total Returns | | | | | Ratios to Average Net Assets(b) | | | | |
| | |
| | |
| | | | Based | | | Ending | | | | | Net | | | | |
Based | | | on | | | Net | | | | | | Investment | | | Portfolio | |
on | | | Share | | | Assets | | | | | | Income | | | Turnover | |
NAV(a) | | | Price(a) | | | | (000) | | Expenses(c) | | | (Loss) | | | Rate(d) | |
| | |
| | |
| (0.40 | )% | | | (2.36 | )% | | $ | 191,883 | | | 2.50 | %** | | | 3.67 | %** | | | 5 | % |
| 0.28 | | | | (1.55 | ) | | | 196,997 | | | 2.15 | | | | 3.70 | | | | 17 | |
| (1.07 | ) | | | (3.46 | ) | | | 205,504 | | | 2.08 | | | | 3.98 | | | | 20 | |
| 8.97 | | | | 13.19 | | | | 216,788 | | | 1.66 | | | | 4.61 | | | | 11 | |
| 4.96 | | | | 5.03 | | | | 208,580 | | | 1.68 | | | | 4.85 | | | | 15 | |
| 0.41 | | | | (1.72 | ) | | | 209,562 | | | 2.88 | | | | 4.33 | | | | 17 | |
| | |
| | |
| | |
| (1.22 | ) | | | (1.83 | ) | | | 129,101 | | | 2.47 | ** | | | 3.72 | ** | | | 11 | |
| 1.29 | | | | (4.84 | ) | | | 133,468 | | | 2.13 | | | | 4.04 | | | | 17 | |
| 0.43 | | | | (2.78 | ) | | | 137,639 | | | 1.91 | | | | 4.29 | | | | 12 | |
| 9.64 | | | | 20.01 | | | | 143,395 | | | 1.62 | | | | 4.65 | | | | 13 | |
| 4.84 | | | | 3.75 | | | | 137,130 | | | 1.96 | | | | 4.57 | | | | 14 | |
| 1.61 | | | | 2.96 | | | | 69,987 | | | 3.09 | | | | 4.17 | | | | 18 | |
| | |
| (b) | Net Investment Income (Loss) ratios reflect income earned and expenses incurred on assets attributable to preferred shares issued by the Fund. |
| (c) | The expense ratios reflect, among other things, all interest expense and other costs related to preferred shares (as described in Note 4 – Fund Shares, Preferred Shares) and/or the interest expense deemed to have been paid by the Fund on the floating rate certificates issued by the special purpose trusts for the self-deposited inverse floaters held by the Fund (as described in Note 3 – Portfolio Securities and Investments in Derivatives, Inverse Floating Rate Securities), where applicable, as follows: |
| | | | | |
NTC | | | NMT | |
| Year Ended 5/31: | | | Year Ended 5/31: | |
| 2019(e) | 1.42%** | | 2019(e) | 1.23%** |
| 2018 | 1.10 | | 2018 | 1.00 |
| 2017 | 1.01 | | 2017 | 0.83 |
| 2016 | 0.60 | | 2016 | 0.58 |
| 2015 | 0.58 | | 2015 | 0.86 |
| 2014 | 1.71 | | 2014 | 1.71 |
| | |
| (d) | Portfolio Turnover Rate is calculated based on the lesser of long-term purchases or sales (as disclosed in Note 5 – Investment Transactions) divided by the average long-term market value during the period. |
| (e) | For the six months ended November 30, 2018. |
| * | Rounds to less than $0.01 per share. |
| ** | Annualized. |
See accompanying notes to financial statements.
33
| |
| Financial Highlights (Unaudited) (continued) |
| | | | | | | | | | | | | | | | | | | |
| | | MTP Shares | | | VMTP Shares | | | VRDP Shares | |
| | | at the End of Period (a) | | | at the End of Period | | | at the End of Period | |
| | |
| | | Aggregate | | | Asset | | | Aggregate | | | Asset | | | Aggregate | | | Asset | |
| | | Amount | | | Coverage | | | Amount | | | Coverage | | | Amount | | | Coverage | |
| | | Outstanding | | | Per $10 | | | Outstanding | | | Per $100,000 | | | Outstanding | | | Per $100,000 | |
| | | | (000 | ) | | Share | | | | (000 | ) | | Share | | | | (000 | ) | | Share | |
NTC | | | | | | | | | | | | | | | | | | | | | |
Year Ended 5/31: | | | | | | | | | | | | | | | | | | |
| 2019(c) | | $ | — | | | $ | — | | | $ | 112,000 | | | $ | 271,324 | | | $ | — | | | $ | — | |
| 2018 | | | — | | | | — | | | | 112,000 | | | | 275,891 | | | | — | | | | — | |
| 2017 | | | — | | | | — | | | | 112,000 | | | | 283,486 | | | | — | | | | — | |
| 2016 | | | — | | | | — | | | | 106,000 | | | | 304,517 | | | | — | | | | — | |
| 2015 | | | — | | | | — | | | | 106,000 | | | | 296,773 | | | | — | | | | — | |
| 2014 | | | — | | | | — | | | | 106,000 | | | | 297,700 | | | | — | | | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
NMT | | | | | | | | | | | | | | | | | | | | | | | | |
Year Ended 5/31: | | | | | | | | | | | | | | | | | | | | | |
| 2019(c) | | | — | | | | — | | | | — | | | | — | | | | 74,000 | | | | 274,461 | |
| 2018 | | | — | | | | — | | | | — | | | | — | | | | 74,000 | | | | 280,362 | |
| 2017 | | | — | | | | — | | | | — | | | | — | | | | 74,000 | | | | 285,999 | |
| 2016 | | | — | | | | — | | | | 74,000 | | | | 293,776 | | | | — | | | | — | |
| 2015 | | | — | | | | — | | | | 74,000 | | | | 285,311 | | | | — | | | | — | |
| 2014 | | | 36,645 | | | | 29.10 | | | | — | | | | — | | | | — | | | | — | |
| | |
| (a) | The Ending and Average Market Value Per Share for each Series of the Fund’s MTP Shares were as follows: |
| | | | | | | |
| | | 2015 | | | 2014 | |
NTC | | | | | | |
Series 2015 (NTC PRC) | | | | | | |
| Ending Market Value per Share | | $ | — | | | $ | — | |
| Average Market Value per Share | | | — | | | | 10.03 | Ω |
Series 2016 (NTC PRD) | | | | | | | | |
| Ending Market Value per Share | | | — | | | | — | |
| Average Market Value per Share | | | — | | | | 10.03 | Ω |
Series 2015 (NTC PRE) (b) | | | | | | | | |
| Ending Market Value per Share | | | — | | | | — | |
| Average Market Value per Share | | | — | | | | 10.03 | Ω |
Series 2015-1 (NTC PRF) (b) | | | | | | | | |
| Ending Market Value per Share | | | — | | | | — | |
| Average Market Value per Share | | | — | | | | 10.03 | Ω |
Series 2015-1 (NTC PRG) (b) | | | | | | | | |
| Ending Market Value per Share | | | — | | | | — | |
| Average Market Value per Share | | | — | | | | 10.03 | Ω |
| | | | | | | | | |
NMT | | | | | | | | |
Series 2015 (NMT PRC) | | | | | | | | |
| Ending Market Value per Share | | | — | | | | 10.06 | |
| Average Market Value per Share | | 10.02 | ΩΩ | | | 10.04 | |
Series 2016 (NMT PRD) | | | | | | | | |
| Ending Market Value per Share | | | — | | | | 10.06 | |
| Average Market Value per Share | | 10.03 | ΩΩ | | | 10.06 | |
Series 2015 (NMT PRE) (b) | | | | | | | | |
| Ending Market Value per Share | | | — | | | | 10.06 | |
| Average Market Value per Share | | | 10.00 | Δ | | | 10.04 | |
Series 2015-1 (NMT PRF) (b) | | | | | | | | |
| Ending Market Value per Share | | | — | | | | 10.02 | |
| Average Market Value per Share | | | 10.00 | Δ | | | 10.04 | |
| | |
| (b) | MTP Shares issued in connection with the reorganizations. |
| (c) | For the six months ended November 30, 2018. |
| Ω | For the period June 1, 2013 through March 3, 2014. |
ΩΩ | For the period June 1, 2014 through July 11, 2014. |
| Δ | For the period June 9, 2014 (effective date of the reorganizations) through July 11, 2014. |
See accompanying notes to financial statements.
34
Notes to Financial Statements (Unaudited)
1. General Information and Significant Accounting Policies
General Information
Fund Information
The funds covered in this report and their corresponding New York Stock Exchange (“NYSE”) symbols are as follows (each a “Fund” and collectively, the “Funds”):
• Nuveen Connecticut Quality Municipal Income Fund (NTC)
• Nuveen Massachusetts Quality Municipal Income Fund (NMT)
The Funds are registered under the Investment Company Act of 1940, as amended, as diversified closed-end management investment companies. NTC and NMT were organized as Massachusetts business trusts on January 12, 1993.
The end of the reporting period for the Funds is November 30, 2018, and the period covered by these Notes to Financial Statements is the six months ended November 30, 2018 (the “current fiscal period”).
Investment Adviser
The Funds’ investment adviser is Nuveen Fund Advisors, LLC (the “Adviser”), subsidiary of Nuveen, LLC (“Nuveen”). Nuveen is the investment management arm of Teachers Insurance and Annuity Association of America (TIAA). The Adviser has overall responsibility for management of the Funds, oversees the management of the Funds’ portfolios, manages the Funds’ business affairs and provides certain clerical, bookkeeping and other administrative services, and, if necessary, asset allocation decisions. The Adviser has entered into sub-advisory agreements with Nuveen Asset Management, LLC (the “Sub-Adviser”), a subsidiary of the Adviser, under which the Sub-Adviser manages the investment portfolios of the Funds.
Investment Objectives and Principal Investment Strategies
Each Fund seeks to provide current income exempt from both regular federal and designated state income taxes by investing primarily in a portfolio of municipal obligations issued by state and local government authorities within a single state or certain U.S. territories. Under normal market conditions, each Fund invests at least 80% of the sum of its net assets and the amount of any borrowings for investment purposes in municipal bonds that pay interest that is exempt from regular federal personal income tax and a single state’s personal income tax. The Fund may invest up to 20% in municipal securities that are exempt from regular federal income tax, but not from that single state’s income tax if, in the Sub-Adviser’s judgement, such purchases are expected to enhance the Fund’s after-tax total return potential. To the extent that the Fund invests in bonds of municipal issuers located in other states, the Fund may have income that is not exempt from state personal income tax.
Significant Accounting Policies
Each Fund is an investment company and follows accounting and reporting guidance under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (ASC) Topic 946 “Financial Services – Investment Companies.” The following is a summary of significant accounting policies followed by the Funds in the preparation of their financial statements in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”).
Investment Transactions
Investment transactions are recorded on a trade date basis. Realized gains and losses from investment transactions are determined on the specific identification method, which is the same basis used for federal income tax purposes. Investments purchased on a when-issued/delayed delivery basis may have extended settlement periods. Any investments so purchased are subject to market fluctuation during this period. The Funds have earmarked securities in their portfolios with a current value at least equal to the amount of the when-issued/delayed delivery purchase commitments.
As of the end of the reporting period, the following Fund’s outstanding when-issued/delayed delivery purchase commitments were as follows:
| | | | |
| | | NTC | |
| Outstanding when-issued/delayed delivery purchase commitments | | $ | 2,149,269 | |
35
Notes to Financial Statements (Unaudited) (continued)
Investment Income
Investment income is comprised of interest income, which reflects the amortization of premiums and accretion of discounts for financial reporting purposes, and is recorded on an accrual basis. Investment income also reflects payment-in-kind (“PIK”) interest and paydown gains and losses, if any. PIK interest represents income received in the form of securities in lieu of cash.
Professional Fees
Professional fees presented on the Statement of Operations consist of legal fees incurred in the normal course of operations, audit fees, tax consulting fees and, in some cases, workout expenditures. Workout expenditures are incurred in an attempt to protect or enhance an investment or to pursue other claims or legal actions on behalf of Fund shareholders. If a refund is received for workout expenditures paid in a prior reporting period, such amounts will be recognized as “Legal fee refund” on the Statement of Operations.
Dividends and Distributions to Common Shareholders
Dividends from net investment income, if any, are declared monthly. Net realized capital gains and/or market discount from investment transactions, if any, are distributed to shareholders at least annually. Furthermore, capital gains are distributed only to the extent they exceed available capital loss carryforwards.
Distributions to common shareholders of net investment income, net realized capital gains and/or market discount, if any, are recorded on the ex-dividend date. The amount and timing of distributions are determined in accordance with federal income tax regulations, which may differ from U.S. GAAP.
Compensation
The Funds pay no compensation directly to those of its trustees who are affiliated with the Adviser or to its officers, all of whom receive remuneration for their services to the Funds from the Adviser or its affiliates. The Funds’ Board of Trustees (the “Board”) has adopted a deferred compensation plan for independent trustees that enables trustees to elect to defer receipt of all or a portion of the annual compensation they are entitled to receive from certain Nuveen-advised funds. Under the plan, deferred amounts are treated as though equal dollar amounts had been invested in shares of select Nuveen-advised funds.
Indemnifications
Under the Funds’ organizational documents, their officers and trustees are indemnified against certain liabilities arising out of the performance of their duties to the Funds. In addition, in the normal course of business, the Funds enter into contracts that provide general indemnifications to other parties. The Funds’ maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Funds that have not yet occurred. However, the Funds have not had prior claims or losses pursuant to these contracts and expect the risk of loss to be remote.
Netting Agreements
In the ordinary course of business, the Funds may enter into transactions subject to enforceable International Swaps and Derivatives Association, Inc. (ISDA) master agreements or other similar arrangements (“netting agreements”). Generally, the right to offset in netting agreements allows each Fund to offset certain securities and derivatives with a specific counterparty, when applicable, as well as any collateral received or delivered to that counterparty based on the terms of the agreements. Generally, each Fund manages its cash collateral and securities collateral on a counterparty basis.
The Funds’ investments subject to netting agreements as of the end of the reporting period, if any, are further described in Note 3 – Portfolio Securities and Investments in Derivatives.
Use of Estimates
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets applicable to common shares from operations during the current fiscal period. Actual results may differ from those estimates.
2. Investment Valuation and Fair Value Measurements
The fair valuation input levels as described below are for fair value measurement purposes.
Fair value is defined as the price that would be received upon selling an investment or transferring a liability in an orderly transaction to an independent buyer in the principal or most advantageous market for the investment. A three-tier hierarchy is used to maximize the use of observable market data and minimize the use of unobservable inputs and to establish classification of fair value measurements for disclosure purposes. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability. Observable inputs are based on market data obtained from sources independent of the reporting entity. Unobservable inputs reflect the reporting entity’s own assumptions about the assumptions market
36
participants would use in pricing the asset or liability. Unobservable inputs are based on the best information available in the circumstances. The following is a summary of the three-tiered hierarchy of valuation input levels.
Level 1 – Inputs are unadjusted and prices are determined using quoted prices in active markets for identical securities.
Level 2 – Prices are determined using other significant observable inputs (including quoted prices for similar securities, interest rates, credit spreads, etc.).
Level 3 – Prices are determined using significant unobservable inputs (including management’s assumptions in determining the fair value of investments).
Prices of fixed income securities are provided by an independent pricing service (“pricing service”) approved by the Board. The pricing service establishes a security’s fair value using methods that may include consideration of the following: yields or prices of investments of comparable quality, type of issue, coupon, maturity and rating, market quotes or indications of value from security dealers, evaluations of anticipated cash flows or collateral, general market conditions and other information and analysis, including the obligor’s credit characteristics considered relevant. These securities are generally classified as Level 2. In pricing certain securities, particularly less liquid and lower quality securities, the pricing service may consider information about a security, its issuer or market activity, provided by the Adviser. These securities are generally classified as Level 2 or Level 3 depending on the observability of the significant inputs.
Certain securities may not be able to be priced by the pre-established pricing methods as described above. Such securities may be valued by the Board and/or its appointee at fair value. These securities generally include, but are not limited to, restricted securities (securities which may not be publicly sold without registration under the Securities Act of 1933, as amended) for which a pricing service is unable to provide a market price; securities whose trading has been formally suspended; debt securities that have gone into default and for which there is no current market quotation; a security whose market price is not available from a pre-established pricing source; a security with respect to which an event has occurred that is likely to materially affect the value of the security after the market has closed but before the calculation of a Fund’s net asset value (“NAV”) (as may be the case in non-U.S. markets on which the security is primarily traded) or make it difficult or impossible to obtain a reliable market quotation; and a security whose price, as provided by the pricing service, is not deemed to reflect the security’s fair value. As a general principle, the fair value of a security would appear to be the amount that the owner might reasonably expect to receive for it in a current sale. A variety of factors may be considered in determining the fair value of such securities, which may include consideration of the following: yields or prices of investments of comparable quality, type of issue, coupon, maturity and rating, market quotes or indications of value from security dealers, evaluations of anticipated cash flows or collateral, general market conditions and other information and analysis, including the obligor’s credit characteristics considered relevant. These securities are generally classified as Level 2 or Level 3 depending on the observability of the significant inputs. Regardless of the method employed to value a particular security, all valuations are subject to review by the Board and/or its appointee.
The inputs or methodologies used for valuing securities are not an indication of the risks associated with investing in those securities. The following is a summary of each Fund’s fair value measurements as of the end of the reporting period:
| | | | | | | | | | | | | |
NTC | | Level 1 | | | Level 2 | | | Level 3 | | | Total | |
| Long-Term Investments*: | | | | | | | | | | | | |
| Municipal Bonds | | $ | — | | | $ | 306,464,629 | | | $ | — | | | $ | 306,464,629 | |
NMT | | | | | | | | | | | | | | | | |
| Long-Term Investments*: | | | | | | | | | | | | | | | | |
| Municipal Bonds | | $ | — | | | $ | 199,935,923 | | | $ | — | | | $ | 199,935,923 | |
| | |
| * | Refer to the Fund’s Portfolio of Investments for industry classifications. |
3. Portfolio Securities and Investments in Derivatives
Portfolio Securities
Inverse Floating Rate Securities
Each Fund is authorized to invest in inverse floating rate securities. An inverse floating rate security is created by depositing a municipal bond (referred to as an “Underlying Bond”), typically with a fixed interest rate, into a special purpose tender option bond (“TOB”) trust (referred to as the “TOB Trust”) created by or at the direction of one or more Funds. In turn, the TOB Trust issues (a) floating rate certificates (referred to as “Floaters”), in face amounts equal to some fraction of the Underlying Bond’s par amount or market value, and (b) an inverse floating rate certificate (referred to as an “Inverse Floater”) that represents all remaining or residual interest in the TOB Trust. Floaters typically pay short-term tax-exempt interest rates to third parties who are also provided a right to tender their certificate and receive its par value, which may be paid from the proceeds of a remarketing of the Floaters, by a loan to the TOB Trust from a third party liquidity provider (“Liquidity Provider”), or by the sale of assets from the TOB Trust. The Inverse Floater is issued to a long term investor, such as one or more of the Funds. The income received by the Inverse Floater holder varies inversely with the short-term rate paid to holders of the Floaters, and in most circumstances the Inverse Floater holder bears substantially all of the Underlying Bond’s downside investment risk and also benefits disproportionately from any potential appreciation of the Underlying Bond’s value. The value of an Inverse
37
Notes to Financial Statements (Unaudited) (continued)
Floater will be more volatile than that of the Underlying Bond because the interest rate is dependent on not only the fixed coupon rate of the Underlying Bond but also on the short-term interest paid on the Floaters, and because the Inverse Floater essentially bears the risk of loss (and possible gain) of the greater face value of the Underlying Bond.
The Inverse Floater held by a Fund gives the Fund the right to (a) cause the holders of the Floaters to tender their certificates at par (or slightly more than par in certain circumstances) and (b) have the trustee of the TOB Trust (the “Trustee”) transfer the Underlying Bond held by the TOB Trust to the Fund, thereby collapsing the TOB Trust.
The Fund may acquire an Inverse Floater in a transaction where it (a) transfers an Underlying Bond that it owns to a TOB Trust created by a third party or (b) transfers an Underlying Bond that it owns, or that it has purchased in a secondary market transaction for the purpose of creating an Inverse Floater, to a TOB Trust created at its direction, and in return receives the Inverse Floater of the TOB Trust (referred to as a “self-deposited Inverse Floater”). A Fund may also purchase an Inverse Floater in a secondary market transaction from a third party creator of the TOB Trust without first owning the Underlying Bond (referred to as an “externally-deposited Inverse Floater”).
An investment in a self-deposited Inverse Floater is accounted for as a “financing” transaction (i.e., a secured borrowing). For a self-deposited Inverse Floater, the Underlying Bond deposited into the TOB Trust is identified in the Fund’s Portfolio of Investments as “(UB) – Underlying bond of an inverse floating rate trust reflected as a financing transaction,” with the Fund recognizing as liabilities, labeled “Floating rate obligations” on the Statement of Assets and Liabilities, (a) the liquidation value of Floaters issued by the TOB Trust, and (b) the amount of any borrowings by the TOB Trust from a Liquidity Provider to enable the TOB Trust to purchase outstanding Floaters in lieu of a remarketing. In addition, the Fund recognizes in “Investment Income” the entire earnings of the Underlying Bond, and recognizes (a) the interest paid to the holders of the Floaters or on the TOB Trust’s borrowings, and (b) other expenses related to remarketing, administration, trustee, liquidity and other services to a TOB Trust, as a component of “Interest expense and amortization of offering costs” on the Statement of Operations.
In contrast, an investment in an externally-deposited Inverse Floater is accounted for as a purchase of the Inverse Floater and is identified in the Fund’s Portfolio of Investments as “(IF) – Inverse floating rate investment.” For an externally-deposited Inverse Floater, a Fund’s Statement of Assets and Liabilities recognizes the Inverse Floater and not the Underlying Bond as an asset, and the Fund does not recognize the Floaters, or any related borrowings from a Liquidity Provider, as a liability. Additionally, the Fund reflects in “Investment Income” only the net amount of earnings on the Inverse Floater (net of the interest paid to the holders of the Floaters or the Liquidity Provider as lender, and the expenses of the Trust), and does not show the amount of that interest paid or the expenses of the TOB Trust as described above as interest expense on the Statement of Operations.
Fees paid upon the creation of a TOB Trust for self-deposited Inverse Floaters and externally-deposited Inverse Floaters are recognized as part of the cost basis of the Inverse Floater and are capitalized over the term of the TOB Trust.
As of the end of the reporting period, the aggregate value of Floaters issued by each Fund’s TOB Trust for self-deposited Inverse Floaters and externally-deposited Inverse Floaters was as follows:
| | | | | | | |
Floating Rate Obligations Outstanding | | NTC | | | NMT | |
| Floating rate obligations: self-deposited Inverse Floaters | | $ | 6,375,000 | | | $ | — | |
| Floating rate obligations: externally-deposited Inverse Floaters | | | 5,085,000 | | | | 7,325,000 | |
| Total | | $ | 11,460,000 | | | $ | 7,325,000 | |
During the current fiscal period, the average amount of Floaters (including any borrowings from a Liquidity Provider) outstanding, and the average annual interest rate and fees related to self-deposited Inverse Floaters, were as follows:
| | | | | | | |
Self-Deposited Inverse Floaters | | NTC | | | NMT | |
| Average floating rate obligations outstanding | | $ | 6,375,000 | | | $ | — | |
| Average annual interest rate and fees | | | 1.99 | % | | | — | % |
TOB Trusts are supported by a liquidity facility provided by a Liquidity Provider pursuant to which the Liquidity Provider agrees, in the event that Floaters are (a) tendered to the Trustee for remarketing and the remarketing does not occur, or (b) subject to mandatory tender pursuant to the terms of the TOB Trust agreement, to either purchase Floaters or to provide the Trustee with an advance from a loan facility to fund the purchase of Floaters by the TOB Trust. In certain circumstances, the Liquidity Provider may otherwise elect to have the Trustee sell the Underlying Bond to retire the Floaters that were tendered and not remarketed prior to providing such a loan. In these circumstances, the Liquidity Provider remains obligated to provide a loan to the extent that the proceeds of the sale of the Underlying Bond are not sufficient to pay the purchase price of the Floaters.
The size of the commitment under the loan facility for a given TOB Trust is at least equal to the balance of that TOB Trust’s outstanding Floaters plus any accrued interest. In consideration of the loan facility, fee schedules are in place and are charged by the Liquidity Provider(s). Any loans made by the Liquidity Provider will be secured by the purchased Floaters held by the TOB Trust. Interest paid on any outstanding loan balances will be effectively
38
borne by the Fund that owns the Inverse Floaters of the TOB Trust that has incurred the borrowing and may be at a rate that is greater than the rate that would have been paid had the Floaters been successfully remarketed.
As described above, any amounts outstanding under a liquidity facility are recognized as a component of “Floating rate obligations” on the Statement of Assets and Liabilities by the Fund holding the corresponding Inverse Floaters issued by the borrowing TOB Trust. As of the end of the reporting period, there were no loans outstanding under any such facility.
Each Fund may also enter into shortfall and forbearance agreements (sometimes referred to as a “recourse arrangement”) (TOB Trusts involving such agreements are referred to herein as “Recourse Trusts”), under which a Fund agrees to reimburse the Liquidity Provider for the Trust’s Floaters, in certain circumstances, for the amount (if any) by which the liquidation value of the Underlying Bond held by the TOB Trust may fall short of the sum of the liquidation value of the Floaters issued by the TOB Trust plus any amounts borrowed by the TOB Trust from the Liquidity Provider, plus any shortfalls in interest cash flows. Under these agreements, a Fund’s potential exposure to losses related to or on an Inverse Floater may increase beyond the value of the Inverse Floater as a Fund may potentially be liable to fulfill all amounts owed to holders of the Floaters or the Liquidity Provider. Any such shortfall amount in the aggregate is recognized as “Unrealized depreciation on Recourse Trusts” on the Statement of Assets and Liabilities.
As of the end of the reporting period, each Fund’s maximum exposure to the Floaters issued by Recourse Trusts for self-deposited Inverse Floaters and externally-deposited Inverse Floaters was as follows:
| | | | | | | |
Floating Rate Obligations – Recourse Trusts | | NTC | | | NMT | |
| Maximum exposure to Recourse Trusts: self-deposited Inverse Floaters | | $ | 6,375,000 | | | $ | — | |
| Maximum exposure to Recourse Trusts: externally-deposited Inverse Floaters | | | 5,085,000 | | | | 7,325,000 | |
| Total | | $ | 11,460,000 | | | $ | 7,325,000 | |
Zero Coupon Securities
A zero coupon security does not pay a regular interest coupon to its holders during the life of the security. Income to the holder of the security comes from accretion of the difference between the original purchase price of the security at issuance and the par value of the security at maturity and is effectively paid at maturity. The market prices of zero coupon securities generally are more volatile than the market prices of securities that pay interest periodically.
Investments in Derivatives
In addition to the inverse floating rate securities in which each Fund may invest, which are considered portfolio securities for financial reporting purposes, each Fund is authorized to invest in certain derivative instruments such as futures, options and swap contracts. Each Fund limits its investments in futures, options on futures and swap contracts to the extent necessary for the Adviser to claim the exclusion from registration by the Commodity Futures Trading Commission as a commodity pool operator with respect to the Fund. The Funds record derivative instruments at fair value, with changes in fair value recognized on the Statement of Operations, when applicable. Even though the Funds’ investments in derivatives may represent economic hedges, they are not considered to be hedge transactions for financial reporting purposes.
Although the Funds are authorized to invest in derivative instruments and may do so in the future, they did not make any such investments during the current fiscal period.
Market and Counterparty Credit Risk
In the normal course of business each Fund may invest in financial instruments and enter into financial transactions where risk of potential loss exists due to changes in the market (market risk) or failure of the other party to the transaction to perform (counterparty credit risk). The potential loss could exceed the value of the financial assets recorded on the financial statements. Financial assets, which potentially expose each Fund to counterparty credit risk, consist principally of cash due from counterparties on forward, option and swap transactions, when applicable. The extent of each Fund’s exposure to counterparty credit risk in respect to these financial assets approximates their carrying value as recorded on the Statement of Assets and Liabilities.
Each Fund helps manage counterparty credit risk by entering into agreements only with counterparties the Adviser believes have the financial resources to honor their obligations and by having the Adviser monitor the financial stability of the counterparties. Additionally, counterparties may be required to pledge collateral daily (based on the daily valuation of the financial asset) on behalf of each Fund with a value approximately equal to the amount of any unrealized gain above a pre-determined threshold. Reciprocally, when each Fund has an unrealized loss, the Funds have instructed the custodian to pledge assets of the Funds as collateral with a value approximately equal to the amount of the unrealized loss above a pre-determined threshold. Collateral pledges are monitored and subsequently adjusted if and when the valuations fluctuate, either up or down, by at least the pre-determined threshold amount.
39
Notes to Financial Statements (Unaudited) (continued)
4. Fund Shares
Common Share Transactions
Transactions in common shares for the Funds during the Funds’ current and prior fiscal period, where applicable, were as follows:
| | | | | | | | | | | | | |
| | | NTC | | | NMT | |
| | | Six Months | | | Year | | | Six Months | | | Year | |
| | | Ended | | | Ended | | | Ended | | | Ended | |
| | | 11/30/18 | | | 5/31/18 | | | 11/30/18 | | | 5/31/18 | |
| Common shares: | | | | | | | | | | | | |
| Issued to shareholders due to reinvestment of distributions | | | — | | | | — | | | | — | | | | 739 | |
| Repurchased and retired | | | (56,199 | ) | | | (105,800 | ) | | | (25,900 | ) | | | — | |
| Weighted average common share: | | | | | | | | | | | | | | | | |
| Price per share repurchased and retired | | $ | 11.20 | | | $ | 11.73 | | | $ | 11.67 | | | | — | |
| Discount per share repurchased and retired | | | 15.69 | % | | | 14.96 | % | | | 15.19 | % | | | — | |
Preferred Shares
Variable Rate MuniFund Term Preferred Shares
The following Fund has issued and has outstanding Variable Rate MuniFund Term Preferred (“VMTP”) Shares, with a $100,000 liquidation preference per share. VMTP Shares are issued via private placement and are not publicly available.
Details of the Funds’ VMTP Shares outstanding, as of the end of the reporting period, were as follows:
| | | | | |
| | | | | Liquidation |
| | | | | Preference |
| | | Shares | Liquidation | Net of Deferred |
Fund | Series | Outstanding | Preference | Offering Costs |
NTC | 2019 | 1,120 | $112,000,000 | $111,994,257 |
The Fund is obligated to redeem its VMTP Shares by the date as specified in its offering document (“Term Redemption Date”), unless earlier redeemed by the Fund. VMTP Shares are subject to optional and mandatory redemption in certain circumstances. The VMTP Shares may be redeemed at the option of the Fund, subject to payment of premium for approximately one year following the date of issuance (“Premium Expiration Date”), and at the redemption price per share thereafter. The redemption price per share is equal to the sum of the liquidation preference per share plus any accumulated but unpaid dividends. The Fund may be obligated to redeem a certain amount of the VMTP Shares if the Fund fails to maintain certain asset coverage and leverage ratio requirements and such failures are not cured by the applicable cure date. The Term Redemption Date and Premium Expiration Date for the Fund’s series of VMTP Shares are as follows:
| | | | |
| | | Term | Premium |
Fund | Series | Redemption Date | Expiration Date |
NTC | 2019 | September 1, 2019 | August 31, 2017 |
The average liquidation preference of VMTP Shares outstanding and annualized dividend rate for the Fund during the current fiscal period were as follows:
| | | | |
| | | NTC | |
| Average liquidation preference of VMTP Shares outstanding | | $ | 112,000,000 | |
| Annualized dividend rate | | | 2.35 | % |
VMTP Shares are subject to restrictions on transfer, generally do not trade, and market quotations are generally not available. VMTP Shares are short-term or short/intermediate-term instruments that pay a variable dividend rate tied to a short-term index, plus an additional fixed “spread” amount established at the time of issuance. The fair value of VMTP Shares is expected to be approximately their liquidation preference so long as the fixed “spread” on the VMTP Shares remains roughly in line with the “spread” being demanded by investors on instruments having similar terms in the current market environment. In present market conditions, the Funds’ Adviser has determined that fair value of VMTP Shares is approximately their liquidation preference, but their fair value could vary if market conditions change materially. For financial reporting purposes, the liquidation preference of VMTP Shares is a liability and is recognized as a component of “Variable Rate MuniFund Term Preferred (“VMTP”) Shares, net of deferred offering costs” on the Statement of Assets and Liabilities.
Dividends on the VMTP shares (which are treated as interest payments for financial reporting purposes) are set weekly. Unpaid dividends on VMTP Shares are recognized as a component of “Interest payable” on the Statement of Assets and Liabilities. Dividends accrued on VMTP Shares are recognized as a component of “Interest expense and amortization of offering costs” on the Statement of Operations.
40
Costs incurred in connection with the Fund’s offering of VMTP Shares were recorded as a deferred charge, which are amortized over the life of the shares and are recognized as components of “Variable Rate MuniFund Term Preferred (“VMTP”) shares, net of deferred offering costs” on the Statement of Assets and Liabilities and “Interest expense and amortization of offering costs” on the Statement of Operations.
Variable Rate Demand Preferred Shares
The following Fund has issued and has outstanding Variable Rate Demand Preferred (“VRDP”) Shares, with a $100,000 liquidation preference per share. VRDP Shares are issued via private placement and are not publicly available.
As of the end of the reporting period, details of the Fund’s VRDP Shares outstanding were as follows:
| | | | | | | |
| | | | | Liquidation | | |
| | | | | Preference | | |
| | | Shares | Liquidation | Net of Deferred | Special Rate | |
Fund | Series | Outstanding | Preference | Offering Costs | Period Expiration | Maturity |
NMT | 1 | 740 | $74,000,000 | $73,724,369 | March 1, 2047 | March 1, 2047 |
VRDP Shares include a liquidity feature that allows VRDP shareholders to have their shares purchased by a liquidity provider with whom the Fund has contracted in the event that VRDP Shares are not able to be successfully remarketed. The Fund is required to redeem any VRDP Shares that are still owned by the liquidity provider after six months of continuous, unsuccessful remarketing. The Fund pays an annual remarketing fee of 0.10% on the aggregate principal amount of all VRDP Shares outstanding.
NMT’s Series 1 VRDP Shares are considered to be Special Rate Period VRDP, which are sold to institutional investors. During the special rate period, the VRDP Shares will not be remarketed by a remarketing agent, be subject to optional or mandatory tender events, or be supported by a liquidity provider. During the special rate period, VRDP dividends will be set monthly as a floating rate based on the predetermined formula. Following the initial special rate period, Special Rate Period VRDP Shares will transition to traditional VRDP Shares with dividends set at weekly remarketings, and be supported by a designated liquidity provider, unless the Board approves a subsequent special rate period.
Dividends on the VRDP Shares (which are treated as interest payments for financial reporting purposes) are set at a rate established by a remarketing agent; therefore, the market value of the VRDP Shares is expected to approximate its liquidation preference. In the event that VRDP Shares are unable to be successfully remarketed, the dividend rate will be the maximum rate which is designed to escalate according to a specified schedule in order to enhance the remarketing agent’s ability to successfully remarket the VRDP Shares.
Subject to certain conditions, VRDP Shares may be redeemed, in whole or in part, at any time at the option of the Fund. The Fund may also redeem certain of the VRDP Shares if the Fund fails to maintain certain asset coverage requirements and such failures are not cured by the applicable cure date. The redemption price per share is equal to the sum of the liquidation preference per share plus any accumulated but unpaid dividends.
The average liquidation preference of VRDP Shares outstanding and annualized dividend rate for the Fund during the current fiscal period were as follows:
| | | | |
| | | NMT | |
| Average liquidation preference of VRDP Shares outstanding | | $ | 74,000,000 | |
| Annualized dividend rate | | | 2.16 | % |
For financial reporting purposes, the liquidation preference of VRDP Shares is a liability and is recognized as a component of “Variable Rate Demand Preferred (“VRDP”) Shares, net of deferred offering costs” on the Statement of Assets and Liabilities. Unpaid dividends on VRDP Shares are recognized as a component of “Interest payable” on the Statement of Assets and Liabilities, when applicable. Dividends accrued on VRDP Shares are recognized as a component of “Interest expense and amortization of offering costs” on the Statement of Operations. Costs incurred by the Fund in connection with its offerings of VRDP Shares was recorded as a deferred charge, which is amortized over the life of the shares and is recognized as a component of “Variable Rate Demand Preferred (“VRDP”) Shares, net of deferred offering costs” on the Statement of Assets and Liabilities and “Interest expense and amortization of offerings costs” on the Statement of Operations. In addition to interest expense, the Fund also pays a per annum liquidity fee to the liquidity provider, as well as a remarketing fee, which are recognized as “Liquidity fees” and “Remarketing fees,” respectively, on the Statement of Operations, when applicable.
41
Notes to Financial Statements (Unaudited) (continued)
5. Investment Transactions
Long-term purchases and sales (including maturities) during the current fiscal period were as follows:
| | | | | | | |
| | | NTC | | | NMT | |
| Purchases | | $ | 17,534,670 | | | $ | 21,904,904 | |
| Sales and maturities | | | 16,892,348 | | | | 21,623,148 | |
6. Income Tax Information
Each Fund is a separate taxpayer for federal income tax purposes. Each Fund intends to distribute substantially all of its net investment income and net capital gains to shareholders and to otherwise comply with the requirements of Subchapter M of the Internal Revenue Code applicable to regulated investment companies. Therefore, no federal income tax provision is required. Furthermore, each Fund intends to satisfy conditions that will enable interest from municipal securities, which is exempt from regular federal and designated state income taxes, to retain such tax-exempt status when distributed to shareholders of the Funds. Net realized capital gains and ordinary income distributions paid by the Funds are subject to federal taxation.
For all open tax years and all major taxing jurisdictions, management of the Funds has concluded that there are no significant uncertain tax positions that would require recognition in the financial statements. Open tax years are those that are open for examination by taxing authorities (i.e., generally the last four tax year ends and the interim tax period since then). Furthermore, management of the Funds is also not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
The following information is presented on an income tax basis. Differences between amounts for financial statement and federal income tax purposes are primarily due to timing differences in recognizing taxable market discount, timing differences in recognizing certain gains and losses on investment transactions and the treatment of investments in inverse floating rate securities reflected as financing transactions, if any. To the extent that differences arise that are permanent in nature, such amounts are reclassified within the capital accounts as detailed below. Temporary differences do not require reclassification. Temporary and permanent differences do not impact the NAVs of the Funds.
The table below presents the cost and unrealized appreciation (depreciation) of each Fund’s investment portfolio, as determined on a federal income tax basis, as of November 30, 2018.
| | | | | | | |
| | | NTC | | | NMT | |
| Tax cost of investments | | $ | 297,013,179 | | | $ | 194,605,386 | |
| Gross unrealized: | | | | | | | | |
| Appreciation | | $ | 6,416,272 | | | $ | 6,222,579 | |
| Depreciation | | | (3,339,831 | ) | | | (892,042 | ) |
| Net unrealized appreciation (depreciation) of investments | | $ | 3,076,441 | | | $ | 5,330,537 | |
Permanent differences, primarily due to federal taxes paid, taxable market discount, nondeductible offering costs and expiration of capital loss carryforwards, resulted in reclassifications among the Funds’ components of common share net assets as of May 31, 2018, the Funds’ last tax year end, as follows:
| | | | | | | |
| | | NTC | | | NMT | |
| Paid-in surplus | | $ | 87,235 | | | $ | (72,524 | ) |
| Undistributed (Over-distribution of) net investment income | | | (89,644 | ) | | | 9,567 | |
| Accumulated net realized gain (loss) | | | 2,409 | | | | 62,957 | |
The tax components of undistributed net tax-exempt income, net ordinary income and net long-term capital gains as of May 31, 2018, the Funds’ last tax year end, were as follows:
| | | | | | | |
| | | NTC | | | NMT | |
Undistributed net tax-exempt income1 | | $ | 380,203 | | | $ | 86,816 | |
Undistributed net ordinary income2 | | | 12,183 | | | | — | |
| Undistributed net long-term capital gains | | | — | | | | — | |
| | |
1 | Undistributed net tax-exempt income (on a tax basis) has not been reduced for the dividend declared on May 1, 2018, paid on June 1, 2018. |
2 | Net ordinary income consists of taxable market discount income and net short-term capital gains, if any. |
42
The tax character of distributions paid during the Funds’ last tax year ended May 31, 2018 was designated for purposes of the dividends paid deduction as follows:
| | | | | | | |
| | | NTC | | | NMT | |
| Distributions from net tax-exempt income | | $ | 9,950,822 | | | $ | 7,254,568 | |
Distributions from net ordinary income2 | | | 18,890 | | | | — | |
| Distributions from net long-term capital gains | | | — | | | | — | |
| | |
2 | Net ordinary income consists of taxable market discount income and net short-term capital gains, if any. |
As of May 31, 2018 the Funds’ last tax year end, the Funds had unused capital losses carrying forward available for federal income tax purposes to be applied against future capital gains, if any. The capital losses are not subject to expiration.
| | | | | | | |
| | | NTC | | | NMT | |
| Not subject to expiration: | | | | | | |
| Short-term | | $ | 2,681,405 | | | $ | 1,242,557 | |
| Long-term | | | 6,537,115 | | | | 3,206,824 | |
| Total | | $ | 9,218,520 | | | $ | 4,449,381 | |
During the Funds’ last tax year ended May 31, 2018, NMT utilized $137,565 of its capital loss carryforward.
As of May 31, 2018, the Funds’ last tax year end, $62,941 of NMT’s capital loss carryforward expired.
7. Management Fees and Other Transactions with Affiliates
Management Fees
Each Fund’s management fee compensates the Adviser for overall investment advisory and administrative services and general office facilities. The Sub-Adviser is compensated for its services to the Funds from the management fees paid to the Adviser.
Each Fund’s management fee consists of two components – a fund-level fee, based only on the amount of assets within each individual Fund, and a complex-level fee, based on the aggregate amount of all eligible fund assets managed by the Adviser. This pricing structure enables Fund shareholders to benefit from growth in the assets within their respective Fund as well as from growth in the amount of complex-wide assets managed by the Adviser.
The annual fund-level fee, payable monthly, for each Fund is calculated according to the following schedule:
| | | | |
| | | NTC | |
| | | NMT | |
Average Daily Managed Assets* | | Fund-Level Fee Rate | |
| For the first $125 million | | | 0.4500 | % |
| For the next $125 million | | | 0.4375 | |
| For the next $250 million | | | 0.4250 | |
| For the next $500 million | | | 0.4125 | |
| For the next $1 billion | | | 0.4000 | |
| For the next $3 billion | | | 0.3750 | |
| For managed assets over $5 billion | | | 0.3625 | |
43
Notes to Financial Statements (Unaudited) (continued)
The annual complex-level fee, payable monthly, for each Fund is calculated by multiplying the current complex-wide fee rate, determined according to the following schedule by the Fund’s daily managed assets:
| | | | |
Complex-Level Eligible Asset Breakpoint Level* | | Effective Complex-Level Fee Rate at Breakpoint Level | |
| $55 billion | | | 0.2000 | % |
| $56 billion | | | 0.1996 | |
| $57 billion | | | 0.1989 | |
| $60 billion | | | 0.1961 | |
| $63 billion | | | 0.1931 | |
| $66 billion | | | 0.1900 | |
| $71 billion | | | 0.1851 | |
| $76 billion | | | 0.1806 | |
| $80 billion | | | 0.1773 | |
| $91 billion | | | 0.1691 | |
| $125 billion | | | 0.1599 | |
| $200 billion | | | 0.1505 | |
| $250 billion | | | 0.1469 | |
| $300 billion | | | 0.1445 | |
| | |
| * | For the complex-level fees, managed assets include closed-end fund assets managed by the Adviser that are attributable to certain types of leverage. For these purposes, leverage includes the funds’ use of preferred stock and borrowings and certain investments in the residual interest certificates (also called inverse floating rate securities) in tender option bond (TOB) trusts, including the portion of assets held by the TOB trust that has been effectively financed by the trust’s issuance of floating rate securities, subject to an agreement by the Adviser as to certain funds to limit the amount of such assets for determining managed assets in certain circumstances. The complex-level fee is calculated based upon the aggregate daily managed assets of all Nuveen open-end and closed-end funds that constitute “eligible assets.” Eligible assets do not include assets attributable to investments in other Nuveen funds or assets in excess of a determined amount (originally $2 billion) added to the Nuveen fund complex in connection with the Adviser’s assumption of the management of the former First American Funds effective January 1, 2011. As of November 30, 2018, the complex-level fee for each Fund was 0.1595%. |
Other Transactions with Affiliates
Each Fund is permitted to purchase or sell securities from or to certain other funds managed by the Adviser (“inter-fund trade”) under specified conditions outlined in procedures adopted by the Board. These procedures have been designed to ensure that any inter-fund trade of securities by the Fund from or to another fund that is, or could be, considered an affiliate of the Fund under certain limited circumstances by virtue of having a common investment adviser (or affiliated investment adviser), common officer and/or common trustee complies with Rule 17a-7 of the 1940 Act. Further, as defined under these procedures, each inter-fund trade is effected at the current market price as provided by an independent pricing service. Unsettled inter-fund trades as of the end of the reporting period are recognized as a component of “Receivable for investments sold” and/or “Payable for investments purchased” on the Statement of Assets and Liabilities, when applicable.
During the current fiscal period, the Funds engaged in inter-fund trades pursuant to these procedures as follows:
| | | | | | | |
Inter-Fund Trades | | NTC | | | NMT | |
| Purchases | | $ | 2,316,493 | | | $ | 13,361,203 | |
| Sales | | | 1,068,020 | | | | 12,129,415 | |
8. Borrowing Arrangements
Committed Line of Credit
The Funds, along with certain other funds managed by the Adviser (“Participating Funds”), have established a 364-day, approximately $2.65 billion standby credit facility with a group of lenders, under which the Participating Funds may borrow for various purposes other than leveraging for investment purposes. Each Participating Fund is allocated a designated proportion of the facility’s capacity (and its associated costs, as described below) based upon a multi-factor assessment of the likelihood and frequency of its need to draw on the facility, the size of the Fund and its anticipated draws, and the potential importance of such draws to the operations and well-being of the Fund, relative to those of the other Funds. A Fund may effect draws on the facility in excess of its designated capacity if and to the extent that other Participating Funds have undrawn capacity. The credit facility expires in July 2019 unless extended or renewed.
The credit facility has the following terms: a fee of 0.15% per annum on unused commitment amounts, and interest at a rate equal to the higher of (a) one-month LIBOR (London Inter-Bank Offered Rate) plus 1.00% per annum or (b) the Fed Funds rate plus 1.00% per annum on amounts borrowed. Participating Funds paid administration, legal and arrangement fees, which are recognized as a component of “Other expenses” on the Statement of
44
Operations, and along with commitment fees, have been allocated among such Participating Funds based upon the relative proportions of the facility’s aggregate capacity reserved for them and other factors deemed relevant by the Adviser and the Board of each Participating Fund.
During the current fiscal period, none of the Funds utilized this facility.
Borrowings outstanding as of the end of the reporting period are recognized as “Borrowings” on the Statement of Assets and Liabilities, where applicable.
Inter-Fund Borrowing and Lending
The Securities and Exchange Commission (“SEC”) has granted an exemptive order permitting registered open-end and closed-end Nuveen funds to participate in an inter-fund lending facility whereby the Nuveen funds may directly lend to and borrow money from each other for temporary purposes (e.g., to satisfy redemption requests or when a sale of securities “fails,” resulting in an unanticipated cash shortfall) (the “Inter-Fund Program”). The closed-end Nuveen funds, including the Funds covered by this shareholder report, will participate only as lenders, and not as borrowers, in the Inter-Fund Program because such closed-end funds rarely, if ever, need to borrow cash to meet redemptions. The Inter-Fund Program is subject to a number of conditions, including, among other things, the requirements that (1) no fund may borrow or lend money through the Inter-Fund Program unless it receives a more favorable interest rate than is typically available from a bank or other financial institution for a comparable transaction; (2) no fund may borrow on an unsecured basis through the Inter-Fund Program unless the fund’s outstanding borrowings from all sources immediately after the inter-fund borrowing total 10% or less of its total assets; provided that if the borrowing fund has a secured borrowing outstanding from any other lender, including but not limited to another fund, the inter-fund loan must be secured on at least an equal priority basis with at least an equivalent percentage of collateral to loan value; (3) if a fund’s total outstanding borrowings immediately after an inter-fund borrowing would be greater than 10% of its total assets, the fund may borrow through the inter-fund loan on a secured basis only; (4) no fund may lend money if the loan would cause its aggregate outstanding loans through the Inter-Fund Program to exceed 15% of its net assets at the time of the loan; (5) a fund’s inter-fund loans to any one fund shall not exceed 5% of the lending fund’s net assets; (6) the duration of inter-fund loans will be limited to the time required to receive payment for securities sold, but in no event more than seven days; and (7) each inter-fund loan may be called on one business day’s notice by a lending fund and may be repaid on any day by a borrowing fund. In addition, a Nuveen fund may participate in the Inter-Fund Program only if and to the extent that such participation is consistent with the fund’s investment objective and investment policies. The Board is responsible for overseeing the Inter-Fund Program.
The limitations detailed above and the other conditions of the SEC exemptive order permitting the Inter-Fund Program are designed to minimize the risks associated with Inter-Fund Program for both the lending fund and the borrowing fund. However, no borrowing or lending activity is without risk. When a fund borrows money from another fund, there is a risk that the loan could be called on one day’s notice or not renewed, in which case the fund may have to borrow from a bank at a higher rate or take other actions to payoff such loan if an inter-fund loan is not available from another fund. Any delay in repayment to a lending fund could result in a lost investment opportunity or additional borrowing costs.
During the current reporting period, none of the Funds covered by this shareholder report have entered into any inter-fund loan activity.
9. New Accounting Pronouncements
Disclosure Update and Simplification
During August 2018, the SEC issued Final Rule Release No. 33-10532, Disclosure Update and Simplification (“Final Rule Release No. 33-10532”). Final Rule Release No. 33-10532 amends certain financial statement disclosure requirements to conform to U.S. GAAP. The amendments to Rule 6-04.17 of Regulation S-X (balance sheet) remove the requirement to separately state the book basis components of net assets: undistributed (over-distribution of) net investment income (“UNII”), accumulated undistributed net realized gains (losses), and net unrealized appreciation (depreciation) at the balance sheet date. Instead, consistent with U.S. GAAP, funds will be required to disclose total distributable earnings. The amendments to Rule 6-09 of Regulation S-X (statement of changes in net assets) remove the requirement to separately state the sources of distributions paid. Instead, consistent with U.S. GAAP, funds will be required to disclose the total amount of distributions paid, except that any tax return of capital must be separately disclosed. The amendments also remove the requirement to parenthetically state the book basis amount of UNII on the statement of changes in net assets.
The requirements of Final Rule Release No. 33-10532 are effective November 5, 2018, and the Funds’ Statement of Assets and Liabilities and Statement of Changes in Net Assets for the current reporting period have been modified accordingly. In addition, certain amounts within each Fund’s Statement of Changes in Net Assets for the prior fiscal period have been modified to conform to Final Rule Release No. 33-10532.
45
Notes to Financial Statements (Unaudited) (continued)
For the prior fiscal period, the total amount of distributions paid to shareholders from net investment income and from accumulated net realized gains, if any, are recognized as “Dividends” on the Statement of Changes in Net Assets.
As of May 31, 2018, the Funds’ Statement of Changes in Net Assets reflected the following UNII balances.
| | | | | | | |
| | | NTC | | | NMT | |
| UNII at the end of period | | $ | (380,422 | ) | | $ | (309,344 | ) |
FASB Accounting Standards Update (“ASU”) 2017-08 (“ASU 2017-08”) Premium Amortization on Purchased Callable Debt Securities
The FASB has issued ASU 2017-08, which shortens the premium amortization period for purchased non-contingently callable debt securities. ASU 2017-08 specifies that the premium amortization period ends at the earliest call date, for purchased non-contingently callable debt securities. ASU 2017-08 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Management is currently evaluating the implications of ASU 2017-08, if any.
10. Subsequent Events
Adjustable Rate MuniFund Term Preferred Shares
During December 2018, NTC issued 1,120 Series 2028 Adjustable Rate Term Preferred (“AMTP”) Shares in exchange for 1,120 Series 2019 VMTP Shares.
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Additional Fund Information
| | | | | | |
Board of Trustees | | | | | |
| Margo Cook* | Jack B. Evans | William C. Hunter | Albin F. Moschner | John K. Nelson | William J. Schneider** |
| Judith M. Stockdale | Carole E. Stone | Terence J. Toth | Margaret L Wolff | Robert L. Young | |
| * | Interested Board Member. |
| ** | Retired from the Funds’ Board of Trustees effective December 31, 2018. |
| |
Fund Manager | Custodian | Legal Counsel | Independent Registered | Transfer Agent and |
| Nuveen Fund Advisors, LLC | State Street Bank | Chapman and Cutler LLP | Public Accounting Firm | Shareholder Services |
| 333 West Wacker Drive | & Trust Company | Chicago, IL 60603 | KPMG LLP | Computershare Trust |
| Chicago, IL 60606 | One Lincoln Street | | 200 East Randolph Street | Company, N.A. |
| | Boston, MA 02111 | | Chicago, IL 60601 | 250 Royall Street |
| | | | | Canton, MA 02021 |
| | | | | (800) 257-8787 |
Quarterly Form N-Q Portfolio of Investments Information
Each Fund is required to file its complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year on Form N-Q. You may obtain this information directly from the SEC. Visit the SEC on-line at http://www.sec.gov or in person at the SEC’s Public Reference Room in Washington, D.C. Call the SEC toll-free at (800) SEC-0330 for room hours and operation.
Nuveen Funds’ Proxy Voting Information
You may obtain (i) information regarding how each fund voted proxies relating to portfolio securities held during the most recent twelve-month period ended June 30, without charge, upon request, by calling Nuveen toll-free at (800) 257-8787 or on Nuveen’s website at www.nuveen.com and (ii) a description of the policies and procedures that each fund used to determine how to vote proxies relating to portfolio securities without charge, upon request, by calling Nuveen toll free at (800) 257-8787. You may also obtain this information directly from the SEC. Visit the SEC on-line at http://www.sec.gov.
CEO Certification Disclosure
Each Fund’s Chief Executive Officer (CEO) has submitted to the New York Stock Exchange (NYSE) the annual CEO certification as required by Section 303A.12(a) of the NYSE Listed Company Manual. Each Fund has filed with the SEC the certification of its CEO and Chief Financial Officer required by Section 302 of the Sarbanes-Oxley Act.
Common Share Repurchases
Each Fund intends to repurchase, through its open-market share repurchase program, shares of its own common stock at such times and in such amounts as is deemed advisable. During the period covered by this report, each Fund repurchased shares of its common stock, as shown in the accompanying table. Any future repurchases will be reported to shareholders in the next annual or semi-annual report.
| | | |
| | NTC | NMT |
| Common shares repurchased | 56,199 | 25,900 |
FINRA BrokerCheck
The Financial Industry Regulatory Authority (FINRA) provides information regarding the disciplinary history of FINRA member firms and associated investment professionals. This information as well as an investor brochure describing FINRA BrokerCheck is available to the public by calling the FINRA BrokerCheck Hotline number at (800) 289-9999 or by visiting www.FINRA.org.
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Glossary of Terms Used in this Report
| · | Auction Rate Bond: An auction rate bond is a security whose interest payments are adjusted periodically through an auction process, which process typically also serves as a means for buying and selling the bond. Auctions that fail to attract enough buyers for all the shares offered for sale are deemed to have “failed,” with current holders receiving a formula-based interest rate until the next scheduled auction. |
| · | Average Annual Total Return: This is a commonly used method to express an investment’s performance over a particular, usually multi-year time period. It expresses the return that would have been necessary each year to equal the investment’s actual cumulative performance (including change in NAV or market price and reinvested dividends and capital gains distributions, if any) over the time period being considered. |
| · | Duration: Duration is a measure of the expected period over which a bond’s principal and interest will be paid, and consequently is a measure of the sensitivity of a bond’s or bond fund’s value to changes when market interest rates change. Generally, the longer a bond’s or fund’s duration, the more the price of the bond or fund will change as interest rates change. |
| · | Effective Leverage: Effective leverage is a fund’s effective economic leverage, and includes both regulatory leverage (see leverage) and the leverage effects of certain derivative investments in the fund’s portfolio. Currently, the leverage effects of Tender Option Bond (TOB) inverse floater holdings are included in effective leverage values, in addition to any regulatory leverage. |
| · | Escrowed to Maturity Bond: When proceeds of a refunding issue are deposited in an escrow account for investment in an amount sufficient to pay the principal and interest on the issue being refunded. In some cases, though, an issuer may expressly reserve its right to exercise an early call of bonds that have been escrowed to maturity. |
| · | Inverse Floating Rate Securities: Inverse floating rate securities, also known as inverse floaters or tender option bonds (TOBs), are created by depositing a municipal bond, typically with a fixed interest rate, into a special purpose trust. This trust, in turn, (a) issues floating rate certificates typically paying short-term tax-exempt interest rates to third parties in amounts equal to some fraction of the deposited bond’s par amount or market value, and (b) issues an inverse floating rate certificate (sometimes referred to as an “inverse floater”) to an investor (such as a Fund) interested in gaining investment exposure to a long-term municipal bond. The income received by the holder of the inverse floater varies inversely with the short-term rate paid to the floating rate certificates’ holders, and in most circumstances the holder of the inverse floater bears substantially all of the underlying bond’s downside investment risk. The holder of the inverse floater typically also benefits disproportionately from any potential appreciation of the underlying bond’s value. Hence, an inverse floater essentially represents an investment in the underlying bond on a leveraged basis. |
| · | Leverage: Leverage is created whenever a fund has investment exposure (both reward and/or risk) equivalent to more than 100% of the investment capital. |
| · | Net Asset Value (NAV) Per Share: A fund’s Net Assets is equal to its total assets (securities, cash, accrued earnings and receivables) less its total liabilities. NAV per share is equal to the fund’s Net Assets divided by its number of shares outstanding. |
| · | Pre-Refunding: Pre-Refunding, also known as advanced refundings or refinancings, is a procedure used by state and local governments to refinance municipal bonds to lower interest expenses. The issuer sells new bonds with a lower yield and uses the proceeds to buy U.S. Treasury securities, the interest from which is used to make payments on the higher-yielding bonds. Because of this collateral, pre-refunding generally raises a bond’s credit rating and thus its value. |
| · | Regulatory Leverage: Regulatory Leverage consists of preferred shares issued by or borrowings of a fund. Both of these are part of a fund’s capital structure. Regulatory leverage is subject to asset coverage limits set in the Investment Company Act of 1940. |
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| · | S&P Municipal Bond Connecticut Index: An unleveraged, market value-weighted index designed to measure the performance of the tax-exempt, investment-grade Connecticut municipal bond market. Index returns assume reinvestment of distributions, but do not reflect any applicable sales charges or management fees. |
| · | S&P Municipal Bond Index: An unleveraged, market value-weighted index designed to measure the performance of the tax- exempt, investment-grade U.S. municipal bond market. Index returns assume reinvestment of distributions, but do not reflect any applicable sales charges or management fees. |
| · | S&P Municipal Bond Massachusetts Index: An unleveraged, market value-weighted index designed to measure the performance of the tax-exempt, investment-grade Massachusetts municipal bond market. Index returns assume reinvestment of distributions, but do not reflect any applicable sales charges or management fees. |
| · | Total Investment Exposure: Total investment exposure is a fund’s assets managed by the Adviser that are attributable to financial leverage. For these purposes, financial leverage includes a fund’s use of preferred stock and borrowings and investments in the residual interest certificates (also called inverse floating rate securities) in tender option bond (TOB) trusts, including the portion of assets held by a TOB trust that has been effectively financed by the trust’s issuance of floating rate securities. |
| · | Zero Coupon Bond: A zero coupon bond does not pay a regular interest coupon to its holders during the life of the bond. Income to the holder of the bond comes from accretion of the difference between the original purchase price of the bond at issuance and the par value of the bond at maturity and is effectively paid at maturity. The market prices of zero coupon bonds generally are more volatile than the market prices of bonds that pay interest periodically. |
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Reinvest Automatically, Easily and Conveniently
Nuveen makes reinvesting easy. A phone call is all it takes to set up your reinvestment account.
Nuveen Closed-End Funds Automatic Reinvestment Plan
Nuveen Closed-End Fund allows you to conveniently reinvest distributions in additional Fund shares. By choosing to reinvest, you’ll be able to invest money regularly and automatically, and watch your investment grow through the power of compounding. Just like distributions in cash, there may be times when income or capital gains taxes may be payable on distributions that are reinvested. It is important to note that an automatic reinvestment plan does not ensure a profit, nor does it protect you against loss in a declining market.
Easy and convenient
To make recordkeeping easy and convenient, each month you’ll receive a statement showing your total distributions, the date of investment, the shares acquired and the price per share, and the total number of shares you own.
How shares are purchased
The shares you acquire by reinvesting will either be purchased on the open market or newly issued by the Fund. If the shares are trading at or above net asset value at the time of valuation, the Fund will issue new shares at the greater of the net asset value or 95% of the then-current market price. If the shares are trading at less than net asset value, shares for your account will be purchased on the open market. If the Plan Agent begins purchasing Fund shares on the open market while shares are trading below net asset value, but the Fund’s shares subsequently trade at or above their net asset value before the Plan Agent is able to complete its purchases, the Plan Agent may cease open-market purchases and may invest the uninvested portion of the distribution in newly-issued Fund shares at a price equal to the greater of the shares’ net asset value or 95% of the shares’ market value on the last business day immediately prior to the purchase date. Distributions received to purchase shares in the open market will normally be invested shortly after the distribution payment date. No interest will be paid on distributions awaiting reinvestment. Because the market price of the shares may increase before purchases are completed, the average purchase price per share may exceed the market price at the time of valuation, resulting in the acquisition of fewer shares than if the distribution had been paid in shares issued by the Fund. A pro rata portion of any applicable brokerage commissions on open market purchases will be paid by Plan participants. These commissions usually will be lower than those charged on individual transactions.
Flexible
You may change your distribution option or withdraw from the Plan at any time, should your needs or situation change. You can reinvest whether your shares are registered in your name, or in the name of a brokerage firm, bank, or other nominee. Ask your investment advisor if his or her firm will participate on your behalf. Participants whose shares are registered in the name of one firm may not be able to transfer the shares to another firm and continue to participate in the Plan. The Fund reserves the right to amend or terminate the Plan at any time. Although the Fund reserves the right to amend the Plan to include a service charge payable by the participants, there is no direct service charge to participants in the Plan at this time.
Call today to start reinvesting distributions
For more information on the Nuveen Automatic Reinvestment Plan or to enroll in or withdraw from the Plan, speak with your financial advisor or call us at (800) 257-8787.
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Notes
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Nuveen:
Serving Investors for Generations
Since 1898, financial advisors and their clients have relied on Nuveen to provide dependable investment solutions through continued adherence to proven, long-term investing principles. Today, we offer a range of high quality solutions designed to be integral components of a well-diversified core portfolio.
Focused on meeting investor needs.
Nuveen is the investment manager of TIAA. We have grown into one of the world’s premier global asset managers, with specialist knowledge across all major asset classes and particular strength in solutions that provide income for investors and that draw on our expertise in alternatives and responsible investing. Nuveen is driven not only by the independent investment processes across the firm, but also the insights, risk management, analytics and other tools and resources that a truly world-class platform provides. As a global asset manager, our mission is to work in partnership with our clients to create solutions which help them secure their financial future.
Find out how we can help you.
To learn more about how the products and services of Nuveen may be able to help you meet your financial goals, talk to your financial advisor, or call us at (800) 257-8787. Please read the information provided carefully before you invest. Investors should consider the investment objective and policies, risk considerations, charges and expenses of any investment carefully.
Learn more about Nuveen Funds at: www.nuveen.com/closed-end-funds
Distributed by Nuveen Securities, LLC | 333 West Wacker Drive Chicago, IL 60606 | www.nuveen.com
ESA-B-1118D 702449-INV-B-01/19
