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<SEC-DOCUMENT>0000930413-05-000111.txt : 20050107
<SEC-HEADER>0000930413-05-000111.hdr.sgml : 20050107
<ACCEPTANCE-DATETIME>20050107121904
ACCESSION NUMBER:		0000930413-05-000111
CONFORMED SUBMISSION TYPE:	N-CSR
PUBLIC DOCUMENT COUNT:		10
CONFORMED PERIOD OF REPORT:	20041031
FILED AS OF DATE:		20050107
DATE AS OF CHANGE:		20050107
EFFECTIVENESS DATE:		20050107

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			BLACKROCK INCOME TRUST INC
		CENTRAL INDEX KEY:			0000832327
		IRS NUMBER:				133463349
		STATE OF INCORPORATION:			MD
		FISCAL YEAR END:			1031

	FILING VALUES:
		FORM TYPE:		N-CSR
		SEC ACT:		1940 Act
		SEC FILE NUMBER:	811-05542
		FILM NUMBER:		05517538

	BUSINESS ADDRESS:	
		STREET 1:		100 BELLEVUE PARKWAY
		STREET 2:		MUTUAL FUND DEPARTMENT
		CITY:			WILMINGTON
		STATE:			DE
		ZIP:			19809
		BUSINESS PHONE:		888-825-2257

	MAIL ADDRESS:	
		STREET 1:		100 BELLEVUE PARKWAY
		STREET 2:		MUTUAL FUND DEPARTMENT
		CITY:			WILMINGTON
		STATE:			DE
		ZIP:			19809

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	BLACKSTONE INCOME TRUST INC
		DATE OF NAME CHANGE:	19920703
</SEC-HEADER>
<DOCUMENT>
<TYPE>N-CSR
<SEQUENCE>1
<FILENAME>c34672_ncsr.htm
<TEXT>
<HTML>
<HEAD>
   <TITLE>c34672_ncsr</TITLE>
</HEAD>

<BODY bgcolor="#ffffff">

<P align="center">
<FONT face="serif">UNITED STATES<br>
SECURITIES AND EXCHANGE COMMISSION<br>
Washington, D.C. 20549 </FONT>
</P>
<P align="center">
<B><FONT size=4 face="serif">FORM N-CSR </FONT></B>
</P>
<P align="center">
<B><FONT face="serif">CERTIFIED SHAREHOLDER REPORT OF REGISTERED<br>
MANAGEMENT INVESTMENT COMPANIES </FONT></B>
</P>
<P align="center">
<FONT face="serif">Investment Company Act file number:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;811-05542</FONT>
</P>
<P align="center">
<FONT face="serif">BlackRock Income Trust, Inc. <br>
(Exact name of registrant as specified in charter) </FONT>
</P>
<TABLE width="100%" border=0 cellspacing=0 cellpadding=0>
<TR>
   <TD width="65%">
     <center>
       <FONT face="serif">100 Bellevue Parkway, Wilmington, DE</FONT>
    </center></TD>
   <TD align="center" width="35%"><center>
     <FONT face="serif">19809</FONT>
   </center></TD>
</TR>
<TR>
   <TD colspan=2><HR align="center" size=2 noshade></TD>
</TR>
<TR>
   <TD><center>
     <FONT face="serif">(Address of principal executive offices)</FONT>
   </center></TD>
   <TD width="35%"><center>
     <FONT face="serif">(Zip code)</FONT>
   </center></TD>
</TR>
</TABLE>
<p></p><P align="center">
<FONT face="serif">Robert S. Kapito, President</FONT>
<p align="center"><FONT face="sans-serif"><B>BlackRock Income Trust, Inc.</B></FONT>
</P>
<P align="center">
<FONT face="serif">40 East 52nd Street, New York, NY 10022<br>
(Name and address of agent for service) </FONT>
</P>
<P>
<FONT face="serif">Registrant's telephone number, including area code:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;888-825-2257</FONT>
<p><FONT face="serif">Date of fiscal year end:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;October 31, 2004</FONT>
<p><FONT face="serif">Date of reporting period:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;October 31, 2004</FONT>

</P>
<P>&nbsp;</P>

<HR noshade align="center" width="100%" size=2>

<PAGE>
<A name="page_2"></A>

<P>
<B><FONT face="serif">Item 1. Reports to Shareholders.</FONT></B><FONT face="serif"> </FONT>
</P>
<P>
<FONT face="serif">The Registrant&#146;s annual report transmitted to shareholders pursuant to Rule 30e-1 under the Investment Company Act of 1940 is as follows: </FONT>
</P>



<FONT size=1 face="sans-serif">FIXED INCOME</FONT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=1 face="sans-serif">LIQUIDITY</FONT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=1 face="sans-serif"></FONT><FONT size=1 face="sans-serif">EQUITIES</FONT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=1 face="sans-serif"></FONT><FONT size=1 face="sans-serif">ALTERNATIVES</FONT>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=1 face="sans-serif"></FONT><FONT size=1 face="sans-serif">BLACKROCK SOLUTIONS</FONT>
<hr size="1" noshade>
<FONT size=5 face="sans-serif">BlackRock</FONT><BR>
<FONT size=5 face="sans-serif">Closed-End Funds</FONT><BR>
<FONT size=5 face="sans-serif">Annual Report</FONT><br>
<BR>
<FONT size=2 face="sans-serif">OCTOBER 31, 2004<br>
<br>
<br>
</FONT>
<hr size="4" noshade>
<BR>
<P>
<FONT size=2 face="sans-serif">BlackRock Broad Investment Grade 2009 Term Trust Inc. (BCT)</FONT></P>
<P><FONT size=2 face="sans-serif"> BlackRock Core Bond Trust (BHK) </FONT></P>
<P><FONT size=2 face="sans-serif">BlackRock High Yield Trust (BHY) </FONT></P>
<P><FONT size=2 face="sans-serif">BlackRock Income Opportunity Trust (BNA) </FONT></P>
<P><FONT size=2 face="sans-serif">BlackRock Income Trust Inc. (BKT) </FONT></P>
<P><FONT size=2 face="sans-serif">BlackRock Limited
          Duration Income Trust (BLW) </FONT></P>
<P><FONT size=2 face="sans-serif">BlackRock Strategic Bond Trust (BHD)</FONT></P>
<hr size="1" noshade>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p align="right"><IMG src="c34672_ncsrx1x1.jpg" border=0></p>
<p><FONT size=1 face="sans-serif">NOT FDIC INSURED</FONT><BR>
    <FONT size=1 face="sans-serif">MAY LOSE VALUE</FONT><BR>
    <FONT size=1 face="sans-serif">NO BANK GUARANTEE</FONT><BR>
  <BR>

</p>
<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
	<TD colspan="3" align=right>
      <center>
        <B><FONT face="serif">TABLE OF CONTENTS</FONT></B>&nbsp;
      </center></TD>
  </TR>
<TR valign="bottom">
	<TD align=left>
<FONT face="serif">Letter to Shareholders</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT face="serif">1</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT face="serif">Trusts&#146; Summaries</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT face="serif">2</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT face="serif">Portfolios of Investments</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT face="serif">9</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=left>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT face="serif">Financial Statements</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp; &nbsp;<FONT face="serif">Statements of Assets and Liabilities</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT face="serif">49</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp; &nbsp;<FONT face="serif">Statements of Operations</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT face="serif">51</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp; &nbsp;<FONT face="serif">Statements of Cash Flows</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT face="serif">53</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp; &nbsp;<FONT face="serif">Statements of Changes in Net Assets</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT face="serif">55</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT face="serif">Financial Highlights</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT face="serif">58</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT face="serif">Notes to Financial Statements</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT face="serif">65</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT face="serif">Report of Independent Registered Public Accounting Firm</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT face="serif">78</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT face="serif">Directors/Trustees Information</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT face="serif">79</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT face="serif">Dividend Reinvestment Plans</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT face="serif">81</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT face="serif">Additional Information</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT face="serif">82</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT face="serif">Tax Information</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT face="serif">82</FONT>&nbsp;
	</TD>
</TR>
</TABLE>
<p>&nbsp;</p>
<p>&nbsp;</p>
<p align="center"><BR>
</p>
<hr size="1" noshade>
<p align="center"><B><FONT size=2 face="serif">Privacy Principles of the Trusts</FONT></B><BR>
</p>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">The Trusts are committed to maintaining the privacy of shareholders and to safeguarding their non-public personal information. The following information is provided to help you understand what
personal information the Trusts collect, how we protect that information and why, in certain cases, we may share information with select other parties.</FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">Generally, the Trusts do not receive any non-public personal information relating to their shareholders, although certain non-public personal information of shareholders may become available to
the Trusts. The Trusts do not disclose any non-public personal information about their shareholders or former shareholders to anyone, except as permitted by law or as is necessary in order to service shareholder accounts (for example, to a transfer
agent or third party administrator).</FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">The Trusts restrict access to non-public personal information about their shareholders to BlackRock employees with a legitimate business need for the information. The Trusts maintain physical,
electronic and procedural safeguards designed to protect the non-public personal information of their shareholders.</FONT></P>

<hr size="1" noshade>
<p>&nbsp;</p>
<HR noshade align="center" width="100%" size=4>

<PAGE>
<p align="center"><B><FONT face="serif">LETTER TO SHAREHOLDERS</FONT></B><BR>
</p>
<p align="right"><FONT size=2 face="serif">October 31, 2004</FONT></p>
<p><BR>
  <FONT size=2 face="serif">Dear Shareholder:</FONT><BR>
</p>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">We are pleased to report that during the annual period, the Trusts provided the opportunity to invest in various portfolios of fixed income securities. This report contains the Trusts&#146;
audited financial statements and a listing of the portfolios&#146; holdings.</FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">The portfolio management team continuously monitors the fixed income markets and adjusts the portfolios in order to gain exposure to various issuers and security types. This strategy enables
the Trusts to move among different sectors, credits and coupons to capitalize on changing market conditions.</FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">The following table shows the Trusts&#146; yields, closing market prices per share and net asset values (&#147;NAV&#148;) per share as of October 31, 2004.</FONT></P>
<center>
  <TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
    <TR>
      <TD colspan=5><HR noshade size=1>
      </TD>
    </TR>
    <TR valign="bottom">
      <TD width=63% align=center>
    <B><FONT size=2 face="serif">Trust</FONT></B>&nbsp;
      </TD>
      <TD colspan="2" align=center>
    <B><FONT size=2 face="serif">Yield</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>
	</TD>
      <TD width=12% align=center>
    <B><FONT size=2 face="serif">Market Price</FONT></B>&nbsp;
      </TD>
      <TD width=13% align=right>
        <center>
          <B><FONT size=2 face="serif">NAV</FONT></B>&nbsp;
        </center></TD>
    </TR>
    <TR>
      <TD colspan=5>
    <HR noshade size=1>
      </TD>
    </TR>
    <TR valign="bottom">
      <TD align=left>
    <FONT size=2 face="serif">BlackRock Broad Investment Grade 2009 Term Trust Inc. (BCT)</FONT>&nbsp;
      </TD>
      <TD width=7% align=right>
        <div align="right"><FONT size=2 face="serif">5.70</FONT>
        </div></TD>
      <TD width=5% align=left>
        <div align="left"><FONT size=2 face="serif">%</FONT>&nbsp;
      </div></TD>
      <TD align=right>          <div align="right"><FONT size=2 face="serif">$15.80</FONT>&nbsp;&nbsp; </div></TD>
      <TD align=right>        <div align="right"><FONT size=2 face="serif">$15.98&nbsp;</FONT>&nbsp;
        </div></TD>
    </TR>
    <TR>
      <TD colspan=5>
    <HR noshade size=1>
      </TD>
    </TR>
    <TR valign="bottom">
      <TD align=left>
    <FONT size=2 face="serif">BlackRock Core Bond Trust (BHK)</FONT>&nbsp;
      </TD>
      <TD align=right>
        <div align="right"><FONT size=2 face="serif">7.49</FONT>
        </div></TD>
      <TD align=left>

	    <div align="right"></div></TD>
      <TD align=right>        <div align="right"><FONT size=2 face="serif">14.02</FONT>&nbsp;
          </div></TD>
      <TD align=right>        <div align="right"><FONT size=2 face="serif">15.22</FONT>&nbsp;
        </div></TD>
    </TR>
    <TR>
      <TD colspan=5>
    <HR noshade size=1>
      </TD>
    </TR>
    <TR valign="bottom">
      <TD align=left>
    <FONT size=2 face="serif">BlackRock High Yield Trust (BHY)</FONT>&nbsp;
      </TD>
      <TD align=right>
        <div align="right"><FONT size=2 face="serif">8.82</FONT>
        </div></TD>
      <TD align=left>

	    <div align="right"></div></TD>
      <TD align=right>        <div align="right"><FONT size=2 face="serif">9.30</FONT>&nbsp;
          </div></TD>
      <TD align=right>        <div align="right"><FONT size=2 face="serif">7.95</FONT>&nbsp;
        </div></TD>
    </TR>
    <TR>
      <TD colspan=5>
    <HR noshade size=1>
      </TD>
    </TR>
    <TR valign="bottom">
      <TD align=left>
    <FONT size=2 face="serif">BlackRock Income Opportunity Trust (BNA)</FONT>&nbsp;
      </TD>
      <TD align=right>
        <div align="right"><FONT size=2 face="serif">7.38</FONT>
        </div></TD>
      <TD align=left>

	    <div align="right"></div></TD>
      <TD align=right>        <div align="right"><FONT size=2 face="serif">11.38</FONT>&nbsp;
          </div></TD>
      <TD align=right>        <div align="right"><FONT size=2 face="serif">12.38</FONT>&nbsp;
        </div></TD>
    </TR>
    <TR>
      <TD colspan=5>
    <HR noshade size=1>
      </TD>
    </TR>
    <TR valign="bottom">
      <TD align=left>
    <FONT size=2 face="serif">BlackRock Income Trust Inc. (BKT)</FONT>&nbsp;
      </TD>
      <TD align=right>
        <div align="right"><FONT size=2 face="serif">8.17</FONT>
        </div></TD>
      <TD align=left>

	    <div align="right"></div></TD>
      <TD align=right>        <div align="right"><FONT size=2 face="serif">7.50</FONT>&nbsp;
          </div></TD>
      <TD align=right>        <div align="right"><FONT size=2 face="serif">6.95</FONT>&nbsp;
        </div></TD>
    </TR>
    <TR>
      <TD colspan=5>
    <HR noshade size=1>
      </TD>
    </TR>
    <TR valign="bottom">
      <TD align=left>
    <FONT size=2 face="serif">BlackRock Limited Duration Income Trust (BLW)</FONT>&nbsp;
      </TD>
      <TD align=right>
        <div align="right"><FONT size=2 face="serif">7.52</FONT>
        </div></TD>
      <TD align=left>

	    <div align="right"></div></TD>
      <TD align=right>        <div align="right"><FONT size=2 face="serif">19.95</FONT>&nbsp;
          </div></TD>
      <TD align=right>        <div align="right"><FONT size=2 face="serif">20.13</FONT>&nbsp;
        </div></TD>
    </TR>
    <TR>
      <TD colspan=5>
    <HR noshade size=1>
      </TD>
    </TR>
    <TR valign="bottom">
      <TD align=left>
    <FONT size=2 face="serif">BlackRock Strategic Bond Trust (BHD)</FONT>&nbsp;
      </TD>
      <TD align=right>
        <div align="right"><FONT size=2 face="serif">9.34</FONT>
        </div></TD>
      <TD align=left>

	    <div align="right"></div></TD>
      <TD align=right>        <div align="right"><FONT size=2 face="serif">16.70</FONT>&nbsp;
          </div></TD>
      <TD align=right>        <div align="right"><FONT size=2 face="serif">15.10</FONT>&nbsp;
        </div></TD>
    </TR>
    <TR valign="bottom">
      <TD colspan="5" align=left><HR noshade size=1></TD>
    </TR>
  </TABLE>
</center>
<P>
<SUP><FONT size=1 face="serif">1</FONT></SUP><FONT size=1 face="serif">Yield is based on market price.</FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">BlackRock, Inc. (&#147;BlackRock&#148;), a world leader in asset management, has a proven commitment to managing fixed income securities. As of September 30, 2004, BlackRock managed $233
billion in bonds, including 20 open-end and 48 closed-end bond funds. BlackRock is recognized for its emphasis on risk management and proprietary analytics and for its reputation managing money for the world&#146;s largest institutional investors.
BlackRock Advisors, Inc., and its affiliate, BlackRock Financial Management, Inc., are wholly owned subsidiaries of BlackRock, Inc.</FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">On behalf of BlackRock, we thank you for your continued confidence and assure you that we remain committed to excellence in managing your assets.</FONT></P>
<P>
<FONT size=2 face="serif">Sincerely,</FONT></P>
<table width="100%"  border="0" cellspacing="0" cellpadding="0">
  <tr valign="bottom">
    <td width="46%"><IMG src="c34672_ncsrx3x1.jpg" border=0> <BR>
      <FONT size=2 face="serif">Laurence D. Fink</FONT><BR>
      <FONT size=2 face="serif">Chief Executive Officer</FONT><BR>
      <FONT size=2 face="serif">BlackRock Advisors, Inc.</FONT></td>
    <td width="54%"><FONT size=2 face="serif"><IMG src="c34672_ncsrx3x2.jpg" width="135" height="67"><br>
      Ralph L. Schlosstein</FONT><BR>
      <FONT size=2 face="serif">President</FONT><BR>
      <FONT size=2 face="serif">BlackRock Advisors, Inc.</FONT></td>
  </tr>
</table>
<BR>
<BR>
<P align="center">
<FONT size=2 face="serif">1</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<P><B><FONT face="serif">TRUST SUMMARIES</FONT></B><BR>
  <B><FONT face="serif">OCTOBER 31, 2004</FONT></B><BR>
  <B><FONT size=2 face="serif">BlackRock Broad Investment Grade 2009 Term Trust Inc. (BCT)</FONT></B><BR>
</P>
<P align="center">
<B><FONT size=2 face="serif">Trust Information</FONT></B></P>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
  <TR>
    <TD colspan=3><HR noshade size=1>
    </TD>
  </TR>
<TR valign="bottom">
	<TD width=80% align=left>
<FONT size=2 face="serif">Symbol on American Stock Exchange:</FONT>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<FONT size=2 face="serif">BCT</FONT>
	</TD>
  </TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Initial Offering Date:</FONT>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<FONT size=2 face="serif">June 17, 1993</FONT>
	</TD>
  </TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Closing Market Price as of 10/31/04:</FONT>&nbsp;
	</TD>
	<TD width=12% align=right>
<FONT size=2 face="serif">$15.80</FONT>
	</TD>
	<TD width=8% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Net Asset Value as of 10/31/04:</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">$15.98</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Yield on Closing Market Price as of 10/31/04 ($15.80):</FONT><SUP><FONT size=2 face="serif">1</FONT></SUP>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">5.70</FONT>
	</TD>
	<TD align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Current Monthly Distribution per Share:</FONT><SUP><FONT size=2 face="serif">2</FONT></SUP>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">$0.075</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Current Annualized Distribution per Share:</FONT><SUP><FONT size=2 face="serif">2</FONT></SUP>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">$0.900</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
</TABLE>
<BR>
<SUP><FONT size=1 face="serif">1 </FONT></SUP><FONT size=1 face="serif">Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price.</FONT>
<P>
<SUP><FONT size=1 face="serif">2 </FONT></SUP><FONT size=1 face="serif">The distribution is not constant and is subject to change.</FONT></P>
<P>
<FONT size=2 face="serif">The table below summarizes the changes in the Trust&#146;s market price and NAV:</FONT></P>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
  <TD align=left>&nbsp;</TD>
  <TD align=right><HR noshade size=1></TD>
  <TD align=right><HR noshade size=1></TD>
  <TD colspan="2" align=right><HR noshade size=1></TD>
  <TD align=left><HR noshade size=1></TD>
  <TD align=center><HR noshade size=1></TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <center>
        <B><FONT size=2 face="serif">10/31/04</FONT></B>&nbsp;
      </center></TD>
	<TD align=right>
      <center>
        <B><FONT size=2 face="serif">10/31/03</FONT></B>&nbsp;
      </center></TD>
	<TD colspan="2" align=right>
      <center>
        <B><FONT size=2 face="serif">Change</FONT></B>
      </center></TD>
	<TD align=left>
      <center>
        <B><FONT size=2 face="serif">High</FONT></B>&nbsp;
      </center></TD>
	<TD align=center>
      <center>
        <B><FONT size=2 face="serif">Low</FONT></B>&nbsp;
      </center></TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Market Price</FONT>&nbsp;
	</TD>
	<TD align=right>
      <center>
        <FONT size=2 face="serif">$15.80</FONT>&nbsp;
      </center></TD>
	<TD align=right>
      <center>
        <FONT size=2 face="serif">$15.85</FONT>&nbsp;
      </center></TD>
	<TD align=right>
<FONT size=2 face="serif">(0.32</FONT>
	</TD>
	<TD align=left>
<FONT size=2 face="serif">)%</FONT>&nbsp;
	</TD>
	<TD align=left>
      <center>
        <FONT size=2 face="serif">$</FONT><FONT size=2 face="serif">16.52</FONT>&nbsp;
      </center></TD>
	<TD align=center>
      <center>
        <FONT size=2 face="serif">$15.20</FONT>&nbsp;
      </center></TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">NAV</FONT>&nbsp;
	</TD>
	<TD align=right>
      <center>
        <FONT size=2 face="serif">$15.98</FONT>&nbsp;
      </center></TD>
	<TD align=right>
      <center>
        <FONT size=2 face="serif">$16.02</FONT>&nbsp;
      </center></TD>
	<TD align=right>
<FONT size=2 face="serif">(0.25</FONT>
	</TD>
	<TD align=left>
<FONT size=2 face="serif">)%</FONT>&nbsp;
	</TD>
	<TD align=left>
      <center>
        <FONT size=2 face="serif">$</FONT><FONT size=2 face="serif">16.58</FONT>&nbsp;
      </center></TD>
	<TD align=center>
      <center>
        <FONT size=2 face="serif">$15.38</FONT>&nbsp;
      </center></TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
</TABLE>
<BR>
<P>
<FONT size=2 face="serif">The following charts show the portfolio composition of the Trust&#146;s long-term investments and credit quality allocations of the Trust&#146;s corporate bond investments:</FONT></P>
<P align="center">
<B><FONT size=2 face="serif">Portfolio Composition</FONT></B></P>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
  <TR>
    <TD colspan=7><HR noshade size=1>
    </TD>
  </TR>
<TR valign="bottom">
	<TD width=55% align=left>
<B><FONT size=2 face="serif">Composition</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<B><FONT size=2 face="serif">October 31, 2004</FONT></B>
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<B><FONT size=2 face="serif">October 31, 2003</FONT></B>
	</TD>
  </TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">U.S. Government and Agency Securities</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD width=11% align=right>
<FONT size=2 face="serif">63</FONT>
	</TD>
	<TD width=10% align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD width=11% align=right>
<FONT size=2 face="serif">56</FONT>
	</TD>
	<TD width=9% align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Agency Multiple Class Mortgage Pass-Throughs</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">13</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">8</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Interest Only Mortgage-Backed Securities</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">7</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">12</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Corporate Bonds</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">6</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">8</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Taxable Municipal Bonds</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">5</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">5</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Inverse Floating Rate Mortgages</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">4</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">8</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Commercial Mortgage-Backed Securities</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">1</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">1</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Mortgage Pass-Throughs</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">1</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">1</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Other</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">1</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
</TABLE>
<BR>
<P align="center">
<B><FONT size=2 face="serif">Corporate Credit Breakdown</FONT></B><B><SUP><FONT size=2 face="serif">3</FONT></SUP></B></P>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
  <TR>
    <TD colspan=7><HR noshade size=1>
    </TD>
  </TR>
<TR valign="bottom">
	<TD width=28% align=left>
<B><FONT size=2 face="serif">Credit Rating</FONT></B>&nbsp;
	</TD>
	<TD width=29%>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<B><FONT size=2 face="serif">October 31, 2004</FONT></B>
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<B><FONT size=2 face="serif">October 31, 2003</FONT></B>
	</TD>
  </TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">AA/Aa</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD width=11% align=right>
<FONT size=2 face="serif">42</FONT>
	</TD>
	<TD width=10% align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD width=11% align=right>
<FONT size=2 face="serif">35</FONT>
	</TD>
	<TD width=9% align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">A</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">43</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">43</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">BBB/Baa</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">13</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">21</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">CCC/Caa</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">1</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
</TABLE>
<BR>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="top">
  <TD nowrap><hr align="left" width="100" size="1"></TD>
  </TR>
<TR valign="top">
	<TD>
<SUP><FONT size=1 face="serif">3 </FONT></SUP><FONT size=1 face="serif">Using the higher of Standard &amp; Poor&#146;s (&#147;S&amp;P&#148;), Moody&#146;s Investors Service (&#147;Moody&#146;s&#148;) or Fitch Ratings (&#147;Fitch&#148;) rating. Corporate bonds represented approximately 8.7% and
11.0% of net assets on October 31, 2004, and October 31, 2003, respectively.</FONT></TD>
  </TR>
<TR><TD>&nbsp;</TD></TR></TABLE>

<p align="center"><FONT size=2 face="serif">2</FONT></p>
<HR noshade align="center" width="100%" size=4>

<PAGE>
<B><FONT face="serif">TRUST SUMMARIES</FONT></B><BR>
<B><FONT face="serif">OCTOBER 31, 2004</FONT></B><BR>
<B><FONT size=2 face="serif">BlackRock Core Bond Trust (BHK)</FONT></B><BR>
<P align="center">
<B><FONT size=2 face="serif">Trust Information</FONT></B></P>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
  <TR>
    <TD colspan=3><HR noshade size=1>
    </TD>
  </TR>
<TR valign="bottom">
	<TD width=74% align=left>
<FONT size=2 face="serif">Symbol on New York Stock Exchange:</FONT>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<FONT size=2 face="serif">BHK</FONT>
	</TD>
  </TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Initial Offering Date:</FONT>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<FONT size=2 face="serif">November 27, 2001</FONT>
	</TD>
  </TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Closing Market Price as of 10/31/04:</FONT>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2 face="serif">$14.02</FONT>
	</TD>
	<TD width=11% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Net Asset Value as of 10/31/04:</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">$15.22</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Yield on Closing Market Price as of 10/31/04 ($14.02):</FONT><SUP><FONT size=2 face="serif">1</FONT></SUP>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">7.49</FONT>
	</TD>
	<TD align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Current Monthly Distribution per Share:</FONT><SUP><FONT size=2 face="serif">2</FONT></SUP>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">$0.0875</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Current Annualized Distribution per Share:</FONT><SUP><FONT size=2 face="serif">2</FONT></SUP>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">$1.0500</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
</TABLE>
<BR>
<P>
<SUP><FONT size=1 face="serif">1 </FONT></SUP><FONT size=1 face="serif">Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price.</FONT></P>
<P>
<SUP><FONT size=1 face="serif">2 </FONT></SUP><FONT size=1 face="serif">The distribution is not constant and is subject to change.</FONT></P>
<P>
<FONT size=2 face="serif">The table below summarizes the changes in the Trust&#146;s market price and NAV:</FONT></P>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
  <TD align=left>&nbsp;</TD>
  <TD colspan="6" align=right><hr noshade size=1></TD>
  </TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <center>
        <B><FONT size=2 face="serif">10/31/04</FONT></B>&nbsp;
      </center></TD>
	<TD align=right>
      <center>
        <B><FONT size=2 face="serif">10/31/03</FONT></B>&nbsp;
      </center></TD>
	<TD colspan="2" align=right>
      <center>
        <B><FONT size=2 face="serif">Change</FONT></B>
      </center></TD>
	<TD align=left>
      <center>
        <B><FONT size=2 face="serif">High</FONT></B>&nbsp;
      </center></TD>
	<TD align=center>
      <center>
        <B><FONT size=2 face="serif">Low</FONT></B>&nbsp;
      </center></TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Market Price</FONT>&nbsp;
	</TD>
	<TD align=right>
      <center>
        <FONT size=2 face="serif">$14.02</FONT>&nbsp;
      </center></TD>
	<TD align=right>
      <center>
        <FONT size=2 face="serif">$13.57</FONT>&nbsp;
      </center></TD>
	<TD align=right>
<FONT size=2 face="serif">3.32</FONT>
	</TD>
	<TD align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
	<TD align=left>
      <center>
        <FONT size=2 face="serif">$</FONT><FONT size=2 face="serif">14.50</FONT>&nbsp;
      </center></TD>
	<TD align=center>
      <center>
        <FONT size=2 face="serif">$12.55</FONT>&nbsp;
      </center></TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">NAV</FONT>&nbsp;
	</TD>
	<TD align=right>
      <center>
        <FONT size=2 face="serif">$15.22</FONT>&nbsp;
      </center></TD>
	<TD align=right>
      <center>
        <FONT size=2 face="serif">$14.75</FONT>&nbsp;
      </center></TD>
	<TD align=right>
<FONT size=2 face="serif">3.19</FONT>
	</TD>
	<TD align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
	<TD align=left>
      <center>
        <FONT size=2 face="serif">$</FONT><FONT size=2 face="serif">15.45</FONT>&nbsp;
      </center></TD>
	<TD align=center>
      <center>
        <FONT size=2 face="serif">$14.08</FONT>&nbsp;
      </center></TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
</TABLE>
<BR>
<P>
<FONT size=2 face="serif">The following charts show the portfolio composition of the Trust&#146;s long-term investments and credit quality allocations of the Trust&#146;s corporate bond investments:</FONT></P>
<P align="center">
<B><FONT size=2 face="serif">Portfolio Composition</FONT></B></P>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
  <TR>
    <TD colspan=7><HR noshade size=1>
    </TD>
  </TR>
<TR valign="bottom">
	<TD width=52% align=left>
<B><FONT size=2 face="serif">Composition</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<B><FONT size=2 face="serif">October 31, 2004</FONT></B>
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<B><FONT size=2 face="serif">October 31, 2003</FONT></B>
	</TD>
  </TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Corporate Bonds</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD width=12% align=right>
<FONT size=2 face="serif">45</FONT>
	</TD>
	<TD width=10% align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD width=12% align=right>
<FONT size=2 face="serif">46</FONT>
	</TD>
	<TD width=10% align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">U.S. Government and Agency Securities</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">27</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">16</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Mortgage Pass-Throughs</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">15</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">26</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Foreign Government Bonds</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">7</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">7</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Interest Only Mortgage-Backed Securities</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">1</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Commercial Mortgage-Backed Securities</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Asset-Backed Securities</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">1</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Collateralized Mortgage Obligations</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">1</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Taxable Municipal Bonds</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
</TABLE>
<BR>
<P align="center">
<B><FONT size=2 face="serif">Corporate Credit Breakdown</FONT></B><B><SUP><FONT size=2 face="serif">3</FONT></SUP></B></P>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
  <TR>
    <TD colspan=7><HR noshade size=1>
    </TD>
  </TR>
<TR valign="bottom">
	<TD width=28% align=left>
<B><FONT size=2 face="serif">Credit Rating</FONT></B>&nbsp;
	</TD>
	<TD width=26%>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<B><FONT size=2 face="serif">October 31, 2004</FONT></B>
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<B><FONT size=2 face="serif">October 31, 2003</FONT></B>
	</TD>
  </TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">AAA/Aaa</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD width=12% align=right>
<FONT size=2 face="serif">4</FONT>
	</TD>
	<TD width=10% align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD width=12% align=right>
<FONT size=2 face="serif">3</FONT>
	</TD>
	<TD width=10% align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">AA/Aa</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">21</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">11</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">A</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">26</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">25</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">BBB/Baa</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">19</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">21</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">BB/Ba</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">7</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">12</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">B</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">18</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">23</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">CCC/Caa</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">5</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Not Rated</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">3</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
</TABLE>
<BR>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="top">
  <TD nowrap><hr align="left" width="100" size="1"></TD>
  </TR>
<TR valign="top">
	<TD>
<SUP><FONT size=1 face="serif">3&nbsp;</FONT></SUP><FONT size=1 face="serif">Using the higher of S&amp;P&#146;s, Moody&#146;s or Fitch&#146;s rating. Corporate bonds represented approximately 61.3% and 61.6% of net assets on October 31, 2004, and October 31, 2003, respectively.</FONT></TD>
  </TR>
<TR><TD>&nbsp;</TD></TR></TABLE>
<P align="center">
<FONT size=2 face="serif">3</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<B><FONT face="serif">TRUST SUMMARIES</FONT></B><BR>
<B><FONT face="serif">OCTOBER 31, 2004</FONT></B><BR>
<B><FONT size=2 face="serif">BlackRock High Yield Trust (BHY)</FONT></B><BR>
<P align="center">
<B><FONT size=2 face="serif">Trust Information</FONT></B></P>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
  <TR>
    <TD colspan=3><HR noshade size=1>
    </TD>
  </TR>
<TR valign="bottom">
	<TD width=74% align=left>
<FONT size=2 face="serif">Symbol on New York Stock Exchange:</FONT>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<FONT size=2 face="serif">BHY</FONT>
	</TD>
  </TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Initial Offering Date:</FONT>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<FONT size=2 face="serif">December 23, 1998</FONT>
	</TD>
  </TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Closing Market Price as of 10/31/04:</FONT>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2 face="serif">$9.30</FONT>
	</TD>
	<TD width=11% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Net Asset Value as of 10/31/04:</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">$7.95</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Yield on Closing Market Price as of 10/31/04 ($9.30):</FONT><SUP><FONT size=2 face="serif">1</FONT></SUP>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">8.82</FONT>
	</TD>
	<TD align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Current Monthly Distribution per Share:</FONT><SUP><FONT size=2 face="serif">2</FONT></SUP>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">$0.068333</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Current Annualized Distribution per Share:</FONT><SUP><FONT size=2 face="serif">2</FONT></SUP>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">$0.819996</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
</TABLE>
<BR>
<P>
<SUP><FONT size=1 face="serif">1 </FONT></SUP><FONT size=1 face="serif">Yield on closing market price is calculated by dividing the annualized distribution per share by the closing market price.</FONT></P>
<P>
<SUP><FONT size=1 face="serif">2 </FONT></SUP><FONT size=1 face="serif">The distribution is not constant and is subject to change.</FONT></P>
<P>
<FONT size=2 face="serif">The table below summarizes the changes in the Trust&#146;s market price and NAV:</FONT></P>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
  <TD align=left>&nbsp;</TD>
  <TD colspan="6" align=right><HR noshade size=1></TD>
  </TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <center>
        <B><FONT size=2 face="serif">10/31/04</FONT></B>&nbsp;
      </center></TD>
	<TD align=right>
      <center>
        <B><FONT size=2 face="serif">10/31/03</FONT></B>&nbsp;
      </center></TD>
	<TD colspan="2" align=right>
      <center>
        <B><FONT size=2 face="serif">Change</FONT></B>
      </center></TD>
	<TD align=left>
      <center>
        <B><FONT size=2 face="serif">High</FONT></B>&nbsp;
      </center></TD>
	<TD align=left>
      <center>
        <B><FONT size=2 face="serif">Low</FONT></B>&nbsp;
      </center></TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Market Price</FONT>&nbsp;
	</TD>
	<TD align=right>
      <center>
        <FONT size=2 face="serif">$9.30</FONT>&nbsp;
      </center></TD>
	<TD align=right>
      <center>
        <FONT size=2 face="serif">$10.25</FONT>&nbsp;
      </center></TD>
	<TD align=right>
<FONT size=2 face="serif">(9.27</FONT>
	</TD>
	<TD align=left>
<FONT size=2 face="serif">)%</FONT>&nbsp;
	</TD>
	<TD align=left> <center>
	  <FONT size=2 face="serif">$</FONT><FONT size=2 face="serif">11.75</FONT>&nbsp;
    </center></TD>
	<TD align=left>
 <center>
   <FONT size=2 face="serif">$</FONT><FONT size=2 face="serif">9.05</FONT>&nbsp;
    </center></TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">NAV</FONT>&nbsp;
	</TD>
	<TD align=right>
      <center>
        <FONT size=2 face="serif">$7.95</FONT>&nbsp;
      </center></TD>
	<TD align=right>
      <center>
        <FONT size=2 face="serif">&nbsp;&nbsp;$6.96</FONT>&nbsp;
      </center></TD>
	<TD align=right>
<FONT size=2 face="serif">14.22</FONT>
	</TD>
	<TD align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
	<TD align=left>
      <center>
        <FONT size=2 face="serif">&nbsp;$</FONT><FONT size=2 face="serif">7.96</FONT>&nbsp;
      </center></TD>
	<TD align=left>
 <center>
   <FONT size=2 face="serif">$</FONT><FONT size=2 face="serif">6.80</FONT>&nbsp;
    </center></TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
</TABLE>
<BR>
<P>
<FONT size=2 face="serif">The following charts show the porfolio composition and credit quality allocations of the Trust&#146;s corporate bond investments:</FONT></P>
<P align="center">
<B><FONT size=2 face="serif">Corporate Portfolio Composition</FONT></B></P>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
  <TR>
    <TD colspan=7><HR noshade size=1>
    </TD>
  </TR>
<TR valign="bottom">
	<TD width=46% align=left>
<B><FONT size=2 face="serif">Composition</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<B><FONT size=2 face="serif">October 31, 2004</FONT></B>
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<B><FONT size=2 face="serif">October 31, 2003</FONT></B>
	</TD>
  </TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Energy</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD width=14% align=right>
<FONT size=2 face="serif">19</FONT>
	</TD>
	<TD width=11% align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD width=13% align=right>
<FONT size=2 face="serif">7</FONT>
	</TD>
	<TD width=12% align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Financial Institutions</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">15</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">12</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Basic Materials</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">14</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">7</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Telecommunications</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">11</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">4</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Media</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">9</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">11</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Consumer Products</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">5</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">16</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Industrials</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">4</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">5</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Health Care</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">4</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Transportation</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">4</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">7</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Entertainment &amp; Leisure</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">3</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Building &amp; Development</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">6</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Technology</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">7</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Aero &amp; Defense</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Containers &amp; Glass</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">4</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Automotive</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">3</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Ecological Services &amp; Equipment</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">1</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Real Estate</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">1</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Conglomerates</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Other</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">3</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
</TABLE>
<BR>
<P align="center">
<B><FONT size=2 face="serif">Corporate Credit Breakdown</FONT></B><B><SUP><FONT size=2 face="serif">3</FONT></SUP></B></P>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
  <TD colspan="7" align=left><HR noshade size=1></TD>
  </TR>
<TR valign="bottom">
	<TD width=28% align=left>
<B><FONT size=2 face="serif">Credit Rating</FONT></B>&nbsp;
	</TD>
	<TD width=20%>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<B><FONT size=2 face="serif">October 31, 2004</FONT></B>
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<B><FONT size=2 face="serif">October 31, 2003</FONT></B>
	</TD>
  </TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">BBB/Baa</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD width=14% align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD width=11% align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD width=13% align=right>
<FONT size=2 face="serif">3</FONT>
	</TD>
	<TD width=12% align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">BB/Ba</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">31</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">12</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">B</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">54</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">52</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">CCC/Caa</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">11</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">25</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">CC/Ca</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">1</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">5</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Not Rated</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">1</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">3</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
</TABLE>
<BR>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR>
  <TD valign=top><hr align="left" width="100" size="1"></TD>
</TR>
<TR>
	<TD valign=top>
<SUP><FONT size=1 face="serif">3</FONT></SUP><FONT size=1 face="serif"> Using the higher of S&amp;P&#146;s, Moody&#146;s or Fitch&#146;s rating. Corporate bonds represented approximately 133.8% and 135.4% of net assets on October 31, 2004, and October 31, 2003, respectively.</FONT>	</TD>
  </TR>
<TR><TD>&nbsp;</TD></TR></TABLE>
<P align="center">
<FONT size=2 face="serif">4</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<B><FONT face="serif">TRUST SUMMARIES</FONT></B><BR>
<B><FONT face="serif">OCTOBER 31, 2004</FONT></B><BR>
<B><FONT size=2 face="serif">BlackRock Income Opportunity Trust (BNA)</FONT></B><BR>
<P align="center">
<B><FONT size=2 face="serif">Trust Information</FONT></B></P>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
  <TR>
    <TD colspan=3><HR noshade size=1>
    </TD>
  </TR>
<TR valign="bottom">
	<TD width=74% align=left>
<FONT size=2 face="serif">Symbol on New York Stock Exchange:</FONT>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<FONT size=2 face="serif">BNA</FONT>
	</TD>
  </TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Initial Offering Date:</FONT>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<FONT size=2 face="serif">December 20, 1991</FONT>
	</TD>
  </TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Closing Market Price as of 10/31/04:</FONT>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2 face="serif">$11.38</FONT>
	</TD>
	<TD width=11% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Net Asset Value as of 10/31/04:</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">$12.38</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Yield on Closing Market Price as of 10/31/04 ($11.38):</FONT><SUP><FONT size=2 face="serif">1</FONT></SUP>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">7.38</FONT>
	</TD>
	<TD align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Current Monthly Distribution per Share:</FONT><SUP><FONT size=2 face="serif">2</FONT></SUP>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">$0.07</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Current Annualized Distribution per Share:</FONT><SUP><FONT size=2 face="serif">2</FONT></SUP>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">$0.84</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
</TABLE>
<BR>
<P>
<SUP><FONT size=1 face="serif">1 </FONT></SUP><FONT size=1 face="serif">Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price.</FONT></P>
<P>
<SUP><FONT size=1 face="serif">2 </FONT></SUP><FONT size=1 face="serif">The distribution is not constant and is subject to change.</FONT></P>
<P>
<FONT size=2 face="serif">The table below summarizes the changes in the Trust&#146;s market price and NAV:</FONT></P>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
  <TD align=left>&nbsp;</TD>
  <TD colspan="6" align=right><HR noshade size=1></TD>
  </TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <center>
        <B><FONT size=2 face="serif">10/31/04</FONT></B>&nbsp;
      </center></TD>
	<TD align=right>
      <center>
        <B><FONT size=2 face="serif">10/31/03</FONT></B>&nbsp;
      </center></TD>
	<TD colspan="2" align=right>
      <center>
        <B><FONT size=2 face="serif">Change</FONT></B>
      </center></TD>
	<TD align=left>
      <center>
        <B><FONT size=2 face="serif">High</FONT></B>&nbsp;
      </center></TD>
	<TD align=center>
      <center>
        <B><FONT size=2 face="serif">Low</FONT></B>&nbsp;
      </center></TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Market Price</FONT>&nbsp;
	</TD>
	<TD align=right>
      <center>
        <FONT size=2 face="serif">$11.38</FONT>&nbsp;
      </center></TD>
	<TD align=right>
      <center>
        <FONT size=2 face="serif">$10.95</FONT>&nbsp;
      </center></TD>
	<TD align=right>
<FONT size=2 face="serif">3.93</FONT>
	</TD>
	<TD align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
	<TD align=left>
      <center>
        <FONT size=2 face="serif">$</FONT><FONT size=2 face="serif">11.63</FONT>&nbsp;
      </center></TD>
	<TD align=center>
      <center>
        <FONT size=2 face="serif">$10.02</FONT>&nbsp;
      </center></TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">NAV</FONT>&nbsp;
	</TD>
	<TD align=right>
      <center>
        <FONT size=2 face="serif">$12.38</FONT>&nbsp;
      </center></TD>
	<TD align=right>
      <center>
        <FONT size=2 face="serif">$11.93</FONT>&nbsp;
      </center></TD>
	<TD align=right>
<FONT size=2 face="serif">3.77</FONT>
	</TD>
	<TD align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
	<TD align=left>
      <center>
        <FONT size=2 face="serif">$</FONT><FONT size=2 face="serif">12.40</FONT>&nbsp;
      </center></TD>
	<TD align=center>
      <center>
        <FONT size=2 face="serif">$16.55</FONT>&nbsp;
      </center></TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
</TABLE>
<BR>
<P>
<FONT size=2 face="serif">The following charts show the portfolio composition of the Trust&#146;s long-term investments and credit quality allocations of the Trust&#146;s corporate bond investments:</FONT></P>
<P align="center">
<B><FONT size=2 face="serif">Portfolio Breakdown</FONT></B></P>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
  <TR>
    <TD colspan=7><HR noshade size=1>
    </TD>
  </TR>
<TR valign="bottom">
	<TD width=52% align=left>
<B><FONT size=2 face="serif">Composition</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<B><FONT size=2 face="serif">October 31, 2004</FONT></B>
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<B><FONT size=2 face="serif">October 31, 2003</FONT></B>
	</TD>
  </TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Corporate Bonds</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD width=12% align=right>
<FONT size=2 face="serif">46</FONT>
	</TD>
	<TD width=10% align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD width=12% align=right>
<FONT size=2 face="serif">59</FONT>
	</TD>
	<TD width=10% align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">U.S. Government and Agency Securities</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">33</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">7</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Mortgage Pass-Through Securities</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">14</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">29</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Non-Agency Multiple Class Mortgage</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Pass-Through Securities</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Interest Only Mortgage-Backed Securities</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Interest Only Asset-Backed Securities</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">1</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Agency Multiple Class Mortgage</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Pass-Through Securities</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">1</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Federal Housing Administration</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">1</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Inverse Floating Rate Mortgage Securities</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">1</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
</TABLE>
<BR>
<P align="center">
<B><FONT size=2 face="serif">Corporate Credit Breakdown</FONT></B><B><SUP><FONT size=2 face="serif">3</FONT></SUP></B></P>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
  <TR>
    <TD colspan=7><HR noshade size=1>
    </TD>
  </TR>
<TR valign="bottom">
	<TD width=28% align=left>
<B><FONT size=2 face="serif">Credit Rating</FONT></B>&nbsp;
	</TD>
	<TD width=26%>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<B><FONT size=2 face="serif">October 31, 2004</FONT></B>
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<B><FONT size=2 face="serif">October 31, 2003</FONT></B>
	</TD>
  </TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">AAA/Aaa</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD width=12% align=right>
<FONT size=2 face="serif">6</FONT>
	</TD>
	<TD width=10% align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD width=12% align=right>
<FONT size=2 face="serif">6</FONT>
	</TD>
	<TD width=10% align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">AA/Aa</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">18</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">12</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">A</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">21</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">22</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">BBB/Baa</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">27</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">19</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">BB/Ba</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">9</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">17</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">B</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">15</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">22</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">CCC/Caa</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Not Rated</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
</TABLE>
<BR>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR>
  <TD valign=top nowrap><hr align="left" width="100" size="1" noshade></TD>
</TR>
<TR>
	<TD valign=top nowrap>
<SUP><FONT size=1 face="serif">3</FONT></SUP>
<FONT size=1 face="serif">Using the higher of S&amp;P&#146;s, Moody&#146;s or Fitch&#146;s rating. Corporate bonds represented approximately 59.6% and 71.2% of net assets on October 31, 2004, and October 31, 2003, respectively.</FONT>	</TD>
  </TR>
<TR><TD>&nbsp;</TD></TR></TABLE>
<P align="center">
<FONT size=2 face="serif">5</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<B><FONT face="serif">TRUST SUMMARIES</FONT></B><BR>
<B><FONT face="serif">OCTOBER 31, 2004</FONT></B><BR>
<B><FONT size=2 face="serif">BlackRock Income Trust Inc. (BKT)</FONT></B><BR>
<P align="center">
<B><FONT size=2 face="serif">Trust Information</FONT></B></P>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
  <TR>
    <TD colspan=3><HR noshade size=1>
    </TD>
  </TR>
<TR valign="bottom">
	<TD width=80% align=left>
<FONT size=2 face="serif">Symbol on New York Stock Exchange:</FONT>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<FONT size=2 face="serif">BKT</FONT>
	</TD>
  </TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Initial Offering Date:</FONT>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<FONT size=2 face="serif">July 22, 1988</FONT>
	</TD>
  </TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Closing Market Price as of 10/31/04:</FONT>&nbsp;
	</TD>
	<TD width=12% align=right>
<FONT size=2 face="serif">$7.50</FONT>
	</TD>
	<TD width=8% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Net Asset Value as of 10/31/04:</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">$6.95</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Yield on Closing Market Price as of 10/31/04 ($7.50):</FONT><SUP><FONT size=2 face="serif">1</FONT></SUP>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">8.17</FONT>
	</TD>
	<TD align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Current Monthly Distribution per Share:</FONT><SUP><FONT size=2 face="serif">2</FONT></SUP>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">$0.051042</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Current Annualized Distribution per Share:</FONT><SUP><FONT size=2 face="serif">2</FONT></SUP>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">$0.612504</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
</TABLE>
<BR>
<P>
<SUP><FONT size=1 face="serif">1 </FONT></SUP><FONT size=1 face="serif">Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price.</FONT></P>
<P>
<SUP><FONT size=1 face="serif">2 </FONT></SUP><FONT size=1 face="serif">The distribution is not constant and is subject to change.</FONT></P>
<P>
<FONT size=2 face="serif">The table below summarizes the changes in the Trust&#146;s market price and NAV:</FONT></P>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
  <TD align=left>&nbsp;</TD>
  <TD colspan="6" align=right><HR noshade size=1></TD>
  </TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <center>
        <B><FONT size=2 face="serif">10/31/04</FONT></B>&nbsp;
      </center></TD>
	<TD align=right>
      <center>
        <B><FONT size=2 face="serif">10/31/03</FONT></B>&nbsp;
      </center></TD>
	<TD colspan="2" align=right>
      <center>
        <B><FONT size=2 face="serif">Change</FONT></B>
      </center></TD>
	<TD align=left>
      <center>
        <B><FONT size=2 face="serif">High</FONT></B>&nbsp;
      </center></TD>
	<TD align=left>
      <center>
        <B><FONT size=2 face="serif">Low</FONT></B>&nbsp;
      </center></TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Market Price</FONT>&nbsp;
	</TD>
	<TD align=right>
      <center>
        <FONT size=2 face="serif">$7.50</FONT>&nbsp;
      </center></TD>
	<TD align=right>
      <center>
        <FONT size=2 face="serif">$7.71</FONT>&nbsp;
      </center></TD>
	<TD align=right>
<FONT size=2 face="serif">(2.72</FONT>
	</TD>
	<TD align=left>
<FONT size=2 face="serif">)%</FONT>&nbsp;
	</TD>
	<TD align=center>
      <center>
        <FONT size=2 face="serif">$7.96</FONT>&nbsp;
      </center></TD>
	<TD align=left>
 <center>
   <FONT size=2 face="serif">$</FONT><FONT size=2 face="serif">6.40</FONT>&nbsp;
    </center></TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">NAV</FONT>&nbsp;
	</TD>
	<TD align=right>
      <center>
        <FONT size=2 face="serif">$6.95</FONT>&nbsp;
      </center></TD>
	<TD align=right>
      <center>
        <FONT size=2 face="serif">$7.21</FONT>&nbsp;
      </center></TD>
	<TD align=right>
<FONT size=2 face="serif">(3.61</FONT>
	</TD>
	<TD align=left>
<FONT size=2 face="serif">)%</FONT>&nbsp;
	</TD>
	<TD align=center>
      <center>
        <FONT size=2 face="serif">$7.25</FONT>&nbsp;
      </center></TD>
	<TD align=left>
      <center>
        <FONT size=2 face="serif">$</FONT>&nbsp;<FONT size=2 face="serif">6.88</FONT>&nbsp;
      </center></TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
</TABLE>
<BR>
<P>
<FONT size=2 face="serif">The following chart shows the portfolio composition of the Trust&#146;s long-term investments: </FONT></P>
<P align="center">
<B><FONT size=2 face="serif">Portfolio Composition</FONT></B></P>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
  <TR>
    <TD colspan=7><HR noshade size=1>
    </TD>
  </TR>
<TR valign="bottom">
	<TD width=52% align=left>
<B><FONT size=2 face="serif">Composition</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<B><FONT size=2 face="serif">October 31, 2004</FONT></B>
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<B><FONT size=2 face="serif">October 31, 2003</FONT></B>
	</TD>
  </TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">U.S. Government and Agency Securities</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD width=12% align=right>
<FONT size=2 face="serif">32</FONT>
	</TD>
	<TD width=10% align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD width=12% align=right>
<FONT size=2 face="serif">30</FONT>
	</TD>
	<TD width=10% align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Mortgage Pass-Through Securities</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">23</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">32</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Agency Multiple Class Mortgage</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Pass-Through Securities</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">12</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">3</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Interest Only Mortgage-Backed Securities</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">10</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">15</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Collateralized Mortgage Obligations</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">10</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Principal Only Mortgage-Backed Securities</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">6</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">11</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Inverse Floating Rate Mortgage Securities</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">4</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Commercial Mortgage-Backed Securities</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Federal Housing Administration</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">3</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Interest Only Asset-Backed Securities</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">1</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2 face="serif">6</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<B><FONT face="serif">TRUST SUMMARIES</FONT></B><BR>
<B><FONT face="serif">OCTOBER 31, 2004</FONT></B><BR>
<B><FONT size=2 face="serif">BlackRock Limited Duration Income Trust (BLW)</FONT></B><BR>
<P align="center">
<B><FONT size=2 face="serif">Trust Information</FONT></B></P>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
  <TR>
    <TD colspan=3><HR noshade size=1>
    </TD>
  </TR>
<TR valign="bottom">
	<TD width=80% align=left>
<FONT size=2 face="serif">Symbol on New York Stock Exchange:</FONT>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<FONT size=2 face="serif">BLW</FONT>
	</TD>
  </TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Initial Offering Date:</FONT>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<FONT size=2 face="serif">July 30, 2003</FONT>
	</TD>
  </TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Closing Market Price as of 10/31/04:</FONT>&nbsp;
	</TD>
	<TD width=12% align=right>
<FONT size=2 face="serif">$19.95</FONT>
	</TD>
	<TD width=8% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Net Asset Value as of 10/31/04:</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">$20.13</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Yield on Closing Market Price as of 10/31/04 ($19.95):</FONT><SUP><FONT size=2 face="serif">1</FONT></SUP>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">7.52</FONT>
	</TD>
	<TD align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Current Monthly Distribution per Share:</FONT><SUP><FONT size=2 face="serif">2</FONT></SUP>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">$0.125</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Current Annualized Distribution per Share:</FONT><SUP><FONT size=2 face="serif">2</FONT></SUP>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">$1.500</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
</TABLE>
<BR>
<P>
<SUP><FONT size=1 face="serif">1 </FONT></SUP><FONT size=1 face="serif">Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price.</FONT></P>
<P>
<SUP><FONT size=1 face="serif">2 </FONT></SUP><FONT size=1 face="serif">The distribution is not constant and is subject to change.</FONT></P>
<P>
<FONT size=2 face="serif">The table below summarizes the Trust&#146;s market price and NAV:</FONT></P>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
  <TD align=left>&nbsp;</TD>
  <TD colspan="6" align=right><HR noshade size=1></TD>
  </TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <center>
        <B><FONT size=2 face="serif">10/31/04</FONT></B>&nbsp;
      </center></TD>
	<TD align=right>
      <center>
        <B><FONT size=2 face="serif">10/31/03</FONT></B>&nbsp;
      </center></TD>
	<TD colspan="2" align=right>
      <center>
        <B><FONT size=2 face="serif">Change</FONT></B>
      </center>

	  <center>
      </center></TD>
	<TD align=left>
      <center>
        <B><FONT size=2 face="serif">High</FONT></B>&nbsp;
      </center></TD>
	<TD align=center>
      <center>
        <B><FONT size=2 face="serif">Low</FONT></B>&nbsp;
      </center></TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Market Price</FONT>&nbsp;
	</TD>
	<TD align=right>
      <center>
        <FONT size=2 face="serif">$19.95</FONT>&nbsp;
      </center></TD>
	<TD align=right>
      <center>
        <FONT size=2 face="serif">$18.80</FONT>&nbsp;
      </center></TD>
	<TD align=right>
<FONT size=2 face="serif">6.12</FONT>
	</TD>
	<TD align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
	<TD align=left>
      <center>
        <FONT size=2 face="serif">$</FONT><FONT size=2 face="serif">20.45</FONT>&nbsp;
      </center></TD>
	<TD align=center>
      <center>
        <FONT size=2 face="serif">$17.95</FONT>&nbsp;
      </center></TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">NAV</FONT>&nbsp;
	</TD>
	<TD align=right>
      <center>
        <FONT size=2 face="serif">$20.13</FONT>&nbsp;
      </center></TD>
	<TD align=right>
      <center>
        <FONT size=2 face="serif">$19.74</FONT>&nbsp;
      </center></TD>
	<TD align=right>
<FONT size=2 face="serif">1.98</FONT>
	</TD>
	<TD align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
	<TD align=left>
      <center>
        <FONT size=2 face="serif">$</FONT><FONT size=2 face="serif">20.32</FONT>&nbsp;
      </center></TD>
	<TD align=center>
      <center>
        <FONT size=2 face="serif">$19.24</FONT>&nbsp;
      </center></TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
</TABLE>
<BR>
<P>
<FONT size=2 face="serif">The following charts show the portfolio composition of the Trust&#146;s long-term investments and credit quality allocations of the Trust&#146;s corporate bond investments:</FONT></P>
<P align="center">
<B><FONT size=2 face="serif">Portfolio Composition</FONT></B></P>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
  <TR>
    <TD colspan=7><HR noshade size=1>
    </TD>
  </TR>
<TR valign="bottom">
	<TD width=51% align=left>
<B><FONT size=2 face="serif">Composition</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<B><FONT size=2 face="serif">October 31, 2004</FONT></B>
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<B><FONT size=2 face="serif">October 31, 2003</FONT></B>
	</TD>
  </TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Corporate Bonds</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD width=12% align=right>
<FONT size=2 face="serif">43</FONT>
	</TD>
	<TD width=10% align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD width=13% align=right>
<FONT size=2 face="serif">47</FONT>
	</TD>
	<TD width=10% align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Bank Loans</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">31</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">20</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Mortgage Pass-Throughs</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">16</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">24</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">U.S. Government and Agency Securities</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">4</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">8</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Foreign Government Bonds</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">1</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Collateralized Mortgage Obligations</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Asset-Backed Securities</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">1</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Interest Only Asset-Backed Securities</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">1</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
</TABLE>
<BR>
<P align="center">
<B><FONT size=2 face="serif">Corporate Credit Breakdown</FONT></B><B><SUP><FONT size=2 face="serif">3</FONT></SUP></B></P>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
  <TD colspan="7" align=left><HR noshade size=1></TD>
  </TR>
<TR valign="bottom">
	<TD width=28% align=left>
<B><FONT size=2 face="serif">Credit Rating</FONT></B>&nbsp;
	</TD>
	<TD width=25%>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<B><FONT size=2 face="serif">October 31, 2004</FONT></B>
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<B><FONT size=2 face="serif">October 31, 2003</FONT></B>
	</TD>
  </TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">A</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD width=12% align=right>
<FONT size=2 face="serif">5</FONT>
	</TD>
	<TD width=10% align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD width=13% align=right>
<FONT size=2 face="serif">6</FONT>
	</TD>
	<TD width=10% align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">BBB/Baa</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">12</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">8</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">BB/Ba</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">28</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">26</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">B</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">50</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">60</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">CCC/Caa</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Not Rated</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">3</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
</TABLE>
<BR>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR>
  <TD valign=top nowrap><hr align="left" width="100" size="1" noshade></TD>
</TR>
<TR>
	<TD valign=top nowrap>
<SUP><FONT size=1 face="serif">3</FONT></SUP>
<FONT size=1 face="serif">Using the higher of S&amp;P&#146;s, Moody&#146;s or Fitch&#146;s rating. Corporate bonds represented approximately 58.2% and 64.6% of net assets on October 31, 2004, and October 31, 2003, respectively.</FONT>	</TD>
  </TR>
<TR><TD>&nbsp;</TD></TR></TABLE>
<P align="center">
<FONT size=2 face="serif">7</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<B><FONT face="serif">TRUST SUMMARIES</FONT></B><BR>
<B><FONT face="serif">OCTOBER 31, 2004</FONT></B><BR>
<B><FONT size=2 face="serif">BlackRock Strategic Bond Trust (BHD)</FONT></B><BR>
<P align="center">
<B><FONT size=2 face="serif">Trust Information</FONT></B></P>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
  <TR>
    <TD colspan=3><HR noshade size=1>
    </TD>
  </TR>
<TR valign="bottom">
	<TD width=75% align=left>
<FONT size=2 face="serif">Symbol on New York Stock Exchange:</FONT>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<FONT size=2 face="serif">BHD</FONT>
	</TD>
  </TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Initial Offering Date:</FONT>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<FONT size=2 face="serif">February 26, 2002</FONT>
	</TD>
  </TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Closing Market Price as of 10/31/04:</FONT>&nbsp;
	</TD>
	<TD width=14% align=right>
<FONT size=2 face="serif">$16.70</FONT>
	</TD>
	<TD width=11% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Net Asset Value as of 10/31/04:</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">$15.10</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Yield on Closing Market Price as of 10/31/04 ($16.70):</FONT><SUP><FONT size=2 face="serif">1</FONT></SUP>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">9.34</FONT>
	</TD>
	<TD align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Current Monthly Distribution per Share:</FONT><SUP><FONT size=2 face="serif">2</FONT></SUP>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">$0.13</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Current Annualized Distribution per Share:</FONT><SUP><FONT size=2 face="serif">2</FONT></SUP>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">$1.56</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
</TABLE>
<BR>
<P>
<SUP><FONT size=1 face="serif">1 </FONT></SUP><FONT size=1 face="serif">Yield on closing market price is calculated by dividing the current annualized distribution per share by the closing market price.</FONT></P>
<P>
<SUP><FONT size=1 face="serif">2 </FONT></SUP><FONT size=1 face="serif">The distribution is not constant and is subject to change.</FONT></P>
<P>
<FONT size=2 face="serif">The table below summarizes the changes in the Trust&#146;s market price and NAV:</FONT></P>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
  <TD align=left>&nbsp;</TD>
  <TD colspan="7" align=right><HR noshade size=1></TD>
  </TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <center>
        <B><FONT size=2 face="serif">10/31/04</FONT></B>&nbsp;
      </center></TD>
	<TD align=right>
      <center>
        <B><FONT size=2 face="serif">10/31/03</FONT></B>&nbsp;
      </center></TD>
	<TD colspan="2" align=right>
      <center>
        <B><FONT size=2 face="serif">Change</FONT></B>
      </center></TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
      <center>
        <B><FONT size=2 face="serif">High</FONT></B>&nbsp;
      </center></TD>
	<TD align=center>
      <center>
        <B><FONT size=2 face="serif">Low</FONT></B>&nbsp;
      </center></TD>
</TR>
<TR>
	<TD colspan=8>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Market Price</FONT>&nbsp;
	</TD>
	<TD align=right>
      <center>
        <FONT size=2 face="serif">$16.70</FONT>&nbsp;
      </center></TD>
	<TD align=right>
      <center>
        <FONT size=2 face="serif">$15.27</FONT>&nbsp;
      </center></TD>
	<TD align=right>
<FONT size=2 face="serif">9.36</FONT>
	</TD>
	<TD align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
      <center>
        <FONT size=2 face="serif">$</FONT><FONT size=2 face="serif">16.70</FONT>&nbsp;
      </center></TD>
	<TD align=center>
      <center>
        <FONT size=2 face="serif">$13.68</FONT>&nbsp;
      </center></TD>
</TR>
<TR>
	<TD colspan=8>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">NAV</FONT>&nbsp;
	</TD>
	<TD align=right>
      <center>
        <FONT size=2 face="serif">$15.10</FONT>&nbsp;
      </center></TD>
	<TD align=right>
      <center>
        <FONT size=2 face="serif">$15.07</FONT>&nbsp;
      </center></TD>
	<TD align=right>
<FONT size=2 face="serif">0.20</FONT>
	</TD>
	<TD align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
      <center>
        <FONT size=2 face="serif">$</FONT><FONT size=2 face="serif">15.60</FONT>&nbsp;
      </center></TD>
	<TD align=center>
      <center>
        <FONT size=2 face="serif">$14.61</FONT>&nbsp;
      </center></TD>
</TR>
<TR>
	<TD colspan=8>
<HR noshade size=1>
	</TD>
</TR>
</TABLE>
<BR>
<P>
<FONT size=2 face="serif">The following charts show the portfolio composition and credit quality allocations of the Trust&#146;s corporate bond investments:</FONT></P>
<P align="center">
<B><FONT size=2 face="serif">Corporate Portfolio Composition</FONT></B></P>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
  <TR>
    <TD colspan=7><HR noshade size=1>
    </TD>
  </TR>
<TR valign="bottom">
	<TD width=46% align=left>
<B><FONT size=2 face="serif">Composition</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<B><FONT size=2 face="serif">October 31, 2004</FONT></B>
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<B><FONT size=2 face="serif">October 31, 2003</FONT></B>
	</TD>
  </TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Financial Institutions</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD width=14% align=right>
<FONT size=2 face="serif">17</FONT>
	</TD>
	<TD width=11% align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD width=14% align=right>
<FONT size=2 face="serif">12</FONT>
	</TD>
	<TD width=11% align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Energy</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">13</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">16</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Media</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">13</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">10</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Automotive</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">10</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">11</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Health Care</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">7</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">5</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Telecommunications</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">7</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">7</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Basic Materials</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">6</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">8</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Consumer Products</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">5</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">3</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Aero &amp; Defense</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">4</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">3</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Building &amp; Development</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">3</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">4</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Technology</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">3</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Entertainment and Leisure</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">3</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Ecological Services &amp; Equipment</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">3</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">3</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Real Estate</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Conglomerates</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">4</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Container &amp; Glass</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">1</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Transportation</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">1</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">2</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Industrials</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">3</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Other</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">1</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
</TABLE>
<BR>
<P align="center">
<B><FONT size=2 face="serif">Corporate Credit Breakdown</FONT></B><B><SUP><FONT size=2 face="serif">3</FONT></SUP></B></P>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
  <TR>
    <TD colspan=7><HR noshade size=1>
    </TD>
  </TR>
<TR valign="bottom">
	<TD width=28% align=left>
<B><FONT size=2 face="serif">Credit Rating</FONT></B>&nbsp;
	</TD>
	<TD width=20%>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<B><FONT size=2 face="serif">October 31, 2004</FONT></B>
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD colspan="2" align=center>
<B><FONT size=2 face="serif">October 31, 2003</FONT></B>
	</TD>
  </TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">AAA/Aaa</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD width=14% align=right>
<FONT size=2 face="serif">4</FONT>
	</TD>
	<TD width=11% align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD width=14% align=right>
<FONT size=2 face="serif">1</FONT>
	</TD>
	<TD width=11% align=left>
<FONT size=2 face="serif">%</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">AA/Aa</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">10</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">5</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">A</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">10</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">9</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">BBB/Baa</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">17</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">10</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">BB/Ba</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">11</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">23</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">B</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">40</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">47</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">CCC/Caa</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">5</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">4</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2 face="serif">Not Rated</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">3</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2 face="serif">1</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
</TABLE>
<BR>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR>
  <TD valign=top nowrap><hr align="left" width="100" size="1" noshade></TD>
</TR>
<TR>
	<TD valign=top nowrap>
<SUP><FONT size=1 face="serif">3</FONT></SUP> <FONT size=1 face="serif">Using the higher of S&amp;P&#146;s, Moody&#146;s or Fitch&#146;s rating. Corporate bonds represented approximately 106.5% and 134.4% of net assets on October 31, 2004, and October 31, 2003, respectively.</FONT>	</TD>
  </TR>
<TR><TD>&nbsp;</TD></TR></TABLE>
<P align="center">
<FONT size=2 face="serif">8</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<A name="page_11"></A>

<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
	<TD colspan=5 align=left>
<B><FONT face="serif">CONSOLIDATED PORTFOLIO OF INVESTMENTS</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD colspan=5 align=left>
<B><FONT face="serif">OCTOBER 31, 2004</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=5>&nbsp;<B><FONT size=2 face="serif">BlackRock Broad Investment Grade 2009 Term Trust Inc. (BCT)</FONT></B>&nbsp;
	</TD>
	<TD colspan=2>
	</TD>
</TR>
<TR>
	<TD colspan=7>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>

	  <center>
    </center></TD>
	<TD colspan=3 align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>
      </center></TD>
	<TD width=70% align=left>&nbsp;

	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
      <center>
        <B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
      </center></TD>
	<TD colspan=3 align=left>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>
      </center></TD>
	<TD width=70% align=left>&nbsp;

	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>
      <center>
        <B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
      </center></TD>
	<TD colspan=3 align=left>
      <center>
        <B><FONT size=2 face="serif">(000)</FONT></B>
    </center></TD>
	<TD width=70% align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><FONT size=2
face="serif">Description</FONT></B>&nbsp;
	</TD>
	<TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
      </center></TD>
  </TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left></TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">LONG-TERM INVESTMENTS&#151;134.1%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left></TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Mortgage Pass-Through Securities&#151;1.3%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left></TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Federal National Mortgage Assoc.,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>
      <div align="right"><FONT size=1 face="serif">$</FONT>&nbsp;
      </div></TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">591</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.50%, 1/01/17 - 2/01/17</FONT>&nbsp;
	</TD>
	<TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">613,312</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">19</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.50%, 7/01/29</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">20,451</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left></TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Total Mortgage Pass-Through Securities</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">633,763</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left></TD>
	<TD width=70% align=center>
      <div align="left"><B><FONT size=2 face="serif">Agency Multiple Class Mortgage Pass-Through Securities&#151;17.3%</FONT></B>&nbsp;
      </div></TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left></TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Federal Home Loan Mortgage Corp.,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">2,168</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1510, Class G, 7.05%, 5/15/13</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">2,361,148</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">78</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1512, Class H, 6.50%, 2/15/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">79,199</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">400</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1534, Class IG, 5.00%, 2/15/10</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">404,667</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1598, Class J, 6.50%, 10/15/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">2,137,160</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">713</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2534, Class NG, 4.50%, 3/15/22</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">714,579</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">206</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2822, Class WZ, 5.00%, 7/15/19</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">205,793</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">162</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2822, Class ZU, 5.00%, 11/15/32</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">160,369</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left></TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Federal National Mortgage Assoc.,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">108</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 13, Class SJ, 8.75%, 2/25/09</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">111,036</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">100</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 22, Class GN, 6.50%, 8/25/31</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">105,021</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">66</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 43, Class E, 7.50%, 4/25/22</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">68,936</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 49, Class H, 7.00%, 4/25/13</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,100,510</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">350</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 214, Class SK, 10.00%, 12/25/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">375,118</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">351</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=center>
      <div align="left"><FONT size=1 face="serif">Government National Mortgage Assoc., Remic Trust 2000, Class 16, 2.539% 12/16/27</FONT>&nbsp;
      </div></TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">352,043</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left></TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Total Agency Multiple Class Mortgage Pass-Through Securities</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">8,175,579</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left></TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Inverse Floating Rate Mortgages&#151;5.1%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">302</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Citicorp Mortgage Securities, Inc., Ser. 14, Class A-4, 20.554%, 11/25/23</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">315,495</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left></TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Federal Home Loan Mortgage Corp.,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">336</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1425, Class SB, 19.894%, 12/15/07</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">391,390</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">76</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1506, Class S, 16.73%, 5/15/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">86,149</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">106</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1515, Class S, 17.141%, 5/15/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">124,619</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">70</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1618, Class SA, 8.25%, 11/15/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">71,215</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">59</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1621, Class SH, 10.942%, 11/15/22</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">60,351</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">85</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1661, Class SB, 16.981%, 1/15/09</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">94,862</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">280</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1688, Class S, 10.303%, 12/15/13</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">296,840</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left></TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Federal National Mortgage Assoc.,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">284</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 187, Class SB, 19.968%, 10/25/07</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">328,529</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">144</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 190, Class S, 19.894%, 11/25/07</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">166,006</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">187</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 191, Class SD, 13.37%, 10/25/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">200,853</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">252</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 214, Class SH, 13.569%, 12/25/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">265,147</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left></TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Total Inverse Floating Rate Mortgages</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">2,401,456</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left></TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Interest Only Mortgage-Backed Securities&#151;8.9%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left></TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Federal Home Loan Mortgage Corp.,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">162</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 65, Class I, 8/15/20</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">2,077</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">54</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 141, Class H, 5/15/21</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">759</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">118</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1114, Class J, 7/15/06</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">2,069</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">61</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1285, Class M, 5/15/07</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,060</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">706</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1645, Class IB, 9/15/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">43,904</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,970</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2523, Class EH, 4/15/20</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">265,983</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,888</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2543, Class IJ, 10/15/12</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">108,035</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,897</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2543, Class IM, 9/15/12</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">87,157</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">5,419</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2572, Class IT, 5/15/19</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">183,093</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">3,578</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2633, Class PI, 3/15/12</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">188,298</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">4,254</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2672, Class TP, 9/15/16</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">194,449</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">5,605</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2739, Class PI, 3/15/22</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">726,770</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">2,550</FONT>
	</TD>
	<TD width=3% align=right>&nbsp;</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2775 Class UB, 12/15/17</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">221,876</FONT>&nbsp;
	</TD>
</TR>
</TABLE>
<center>
  <BR>
  <FONT size=2 face="serif">See Notes to Financial Statements.</FONT><BR>
</center>
<P align="center">
<FONT size=2 face="serif">9</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
	<TD colspan=5 align=left>
<B><FONT size=2 face="serif">BlackRock Broad Investment Grade 2009 Term Trust Inc. (BCT) (continued)</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>
      </center></TD>
	<TD width=70% align=left>&nbsp;

	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
	</TD>
	<TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>
      </center></TD>
	<TD width=70% align=left>&nbsp;

	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
	</TD>
	<TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>&nbsp;
      </center></TD>
	<TD width=70% align=center>
<B><FONT size=2 face="serif">Description</FONT></B>&nbsp;
	</TD>
	<TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
      </center></TD>
  </TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Interest Only Mortgage-Backed Securities&#151;(cont&#146;d)</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Federal National Mortgage Assoc.,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=right>
<FONT size=1 face="serif">$</FONT>
	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">343</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 8, Class HA, 1/25/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">47,188</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 13, Class IG, 10/25/22</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">282,540</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">341</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 20, Class SL, 9/25/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">59,968</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">31</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 39, Class PE, 1/25/23</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">502</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">905</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 49, Class L, 4/25/13</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">57,514</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">781</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 51, Class K, 4/25/07</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">78,506</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">12,992</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 70, Class ID, 4/25/22</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,489,793</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">78</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 72, Class H, 7/25/06</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">6,917</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,635</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 82, Class IR, 9/25/12</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">80,208</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">179</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 194, Class PV, 6/25/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">5,298</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">173</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 223, Class PT, 10/25/23</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">16,598</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">5</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. G-21, Class L, 7/25/21</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">8,083</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">18</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">PNC Mortgage Securities Corp., Ser. 8, Class 4-X, 10/25/28</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">773</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">23,305</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Vendee Mortgage Trust, Ser. 1, Class IO, 10/15/31</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">28,666</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Total Interest Only Mortgage-Backed Securities</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">4,188,084</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Collaterialized Mortgage Obligation Residuals&#151;0.0%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">6</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 174, Class S, 9/25/22</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">17,194</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">562</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 208, Class S, 2/25/23</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">19,172</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Total Collateralized Mortgage Obligation Residuals</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">36.366</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Principal Only Mortgage-Backed Securities&#151;0.1%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Aaa</FONT>&nbsp;
	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">40</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Salomon Brothers Mortgage Securities, Inc. VI, Ser. 3, Class A, 10/23/17</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">37,267</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Commercial Mortgage-Backed Securities&#151;1.7%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">750</FONT><SUP><FONT size=1 face="serif">2</FONT></SUP>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">New York City Mortgage Loan Trust, Multi-Family, Class A2, 6.75%, 6/25/11</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">805,090</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Asset-Backed Securities&#151;0.0%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">NR</FONT>&nbsp;
	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">238 </FONT><SUP></SUP>
	</TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">2,3,4</FONT></SUP>

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Global Rated Eligible Asset Trust, Ser. A, Class 1, 7.33%, 9/15/07</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">4,757</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Structured Mortgage Asset Residential Trust,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">NR</FONT>&nbsp;
	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">575</FONT>
	</TD>
	<TD width=3% align=left><FONT size=1 face="serif"></FONT><SUP><FONT size=1 face="serif">3,4</FONT></SUP>

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2, 8.24%, 3/15/06</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">5,749</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">NR</FONT>&nbsp;
	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">637</FONT><SUP></SUP>
	</TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">3,4</FONT></SUP>

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 3, 8.724%, 4/15/06</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">6,373</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Total Asset-Backed Securities</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">16,879</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Corporate Bonds&#151;8.7%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Basic Materials&#151;2.6%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">A+</FONT>&nbsp;
	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Dow Capital BV, 9.20%, 6/01/10 (Netherlands)</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,225,040</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Energy&#151;1.1%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">500</FONT><SUP></SUP>
	</TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Israel Electric Corp., Ltd., 7.25%, 12/15/06 (Israel)</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">538,225</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Financial Institutions&#151;3.7%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AA-</FONT>&nbsp;
	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT><SUP></SUP>
	</TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">5</FONT></SUP>

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Morgan Stanley Group, Inc., 10.00%, 6/15/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,209,040</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AA+</FONT>&nbsp;
	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">500</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">UBS PaineWebber Group, Inc., 8.875%, 3/15/05</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">510,645</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>&nbsp;

	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,719,685</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Telecommunications&#151;1.1%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">A</FONT>&nbsp;
	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">500</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">ALLTEL Corp., 7.50%, 3/01/06</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">529,585</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Transportation&#151;0.2%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Caa2</FONT>&nbsp;
	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">100</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">American Airlines, Inc., 10.44%, 3/04/07</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">79,250</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Total Corporate Bonds</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">4,091,785</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">U.S. Government and Agency Securities&#151;83.8%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">206</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Small Business Investment Companies, Ser. P10A, Class 1, 6.12%, 2/01/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">218,386</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">27,000</FONT><SUP></SUP>
	</TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">5</FONT></SUP>

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">U.S. Treasury Bond, zero coupon, 11/15/09</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">22,697,145</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">U.S. Treasury Notes,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">3,200</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">3.50%, 11/15/06</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">3,258,874</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">7,000</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.375%, 8/15/12</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">7,264,669</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,700</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.75%, 11/15/05</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,760,761</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">3,550</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.00%, 8/15/09</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">3,978,357</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">385</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.625%, 5/15/07</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">421,846</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=45 align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Total U.S. Government and Agency Securities</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">39,600,038</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
</TABLE>
<center>
  <BR>
  <FONT size=2 face="serif">See Notes to Financial Statements.</FONT><BR>
</center>
<P align="center">
<FONT size=2 face="serif">10</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
	<TD colspan=5 align=left>
<B><FONT size=2 face="serif">BlackRock Broad Investment Grade 2009 Term Trust Inc. (BCT) (continued)</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=8>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>
      </center></TD>
	<TD width=70% align=left>&nbsp;

	</TD>
	<TD width=1% align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
	</TD>
	<TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>
      </center></TD>
	<TD width=70% align=left>&nbsp;

	</TD>
	<TD width=1% align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
	</TD>
	<TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>&nbsp;
      </center></TD>
	<TD width=70% align=center>
<B><FONT size=2 face="serif">Description</FONT></B>&nbsp;
	</TD>
	<TD colspan="3" align=left>      <center>
	  <B><FONT size=2 face="serif">Value</FONT></B>
    </center></TD>
  </TR>
<TR>
	<TD colspan=8>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Taxable Municipal Bonds&#151;7.2%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
	</TD>
	<TD width=4% align=right>
<FONT size=1 face="serif">$</FONT>
	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">500</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Fresno California Pension Oblig., 7.80%, 6/01/14</FONT>&nbsp;
	</TD>
	<TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=1 face="serif">621,915</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">500</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Kern County California Pension Oblig., 6.98%, 8/15/09</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=1 face="serif">565,870</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Los Angeles County California Pension Oblig.,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. A, 8.62%, 6/30/06</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=1 face="serif">1,095,830</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">500</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. D, 6.97%, 6/30/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=1 face="serif">556,515</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">500</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Orleans Parish Louisiana School Board, Ser. A, 6.60%, 2/01/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=1 face="serif">544,870</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=3>
<HR align="left" size=1 noshade>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Total Taxable Municipal Bonds</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=1 face="serif">3,385,000</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=3>
<HR align="left" size=1 noshade>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=1 face="serif">Total Long-Term Investments </FONT></B><FONT size=1 face="serif">(cost $60,802,403)</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=1 face="serif">63,371,306</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=3>
<HR align="left" size=1 noshade>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">SHORT-TERM INVESTMENT&#151;5.9%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">U.S. Government and Agency Security&#151;5.9%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">2,800</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Federal Home Loan Bank, 1.69%, 11/01/04 (cost $2,800,000)</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=1 face="serif">2,800,000</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=3>
<HR align="left" size=1 noshade>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=1 face="serif">Total Investments&#151;140.0% </FONT></B><FONT size=1 face="serif">(cost $63,602,403)</FONT>&nbsp;
	</TD>
	<TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=1 face="serif">66,171,306</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Liabilities in excess of other assets&#151;(40.0)%</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	  <div align="left"></div></TD>
	<TD align=right>
      <FONT size=1 face="serif">(18,915,873</FONT>
	</TD>
	<TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
	</TD>
</TR>
<TR>
  <TD colspan=5></TD>
  <TD colspan=3><HR align="left" size=1 noshade>
  </TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=1 face="serif">Net Assets&#151;100%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
	<TD align=right>
      <FONT size=1 face="serif">47,255,433</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=3>
<HR align="left" size=3 noshade>
	</TD>
</TR>
</TABLE>
<BR>
<TABLE border=0 cellspacing=0 cellpadding=0>
<TR valign="top">
  <TD colspan="2" nowrap><HR align="left" width="100" size=1 noshade></TD>
  </TR>
<TR valign="top">
	<TD nowrap>
<SUP><FONT size=1 face="serif">1</FONT></SUP>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD>
<FONT size=1 face="serif">Using the higher of S&amp;P&#146;s, Moody&#146;s or Fitch&#146;s rating.</FONT>	</TD>
</TR>
<TR valign="top">
	<TD nowrap>
<SUP><FONT size=1 face="serif">2</FONT></SUP> 	</TD>
	<TD>
<FONT size=1 face="serif">Security is not registered under the Securities Act of 1933. These securities may be resold in transactions in accordance with Rule 144A under that Act, to qualified institutional buyers. As of October 31, 2004, the Trust
held 2.9% of its net assets, with a current market value of $1,348,072, in securities restricted as to resale.</FONT></TD>
</TR>
<TR valign="top">
	<TD nowrap>
<SUP><FONT size=1 face="serif">3</FONT></SUP>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD>
<FONT size=1 face="serif">Security is fair valued.</FONT>	</TD>
</TR>
<TR valign="top">
	<TD nowrap>
<SUP><FONT size=1 face="serif">4</FONT></SUP>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD>
<FONT size=1 face="serif">Illiquid securities representing 0.04% of net assets.</FONT>	</TD>
</TR>
<TR valign="top">
	<TD nowrap>
<SUP><FONT size=1 face="serif">5</FONT></SUP>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD>
<FONT size=1 face="serif">Entire or partial principal amount pledged as collateral for reverse repurchase agreements or financial futures contracts.</FONT>	</TD>
</TR>
<TR><TD colspan=2>&nbsp;</TD></TR></TABLE>
<P>
<FONT size=1 face="serif">Details of open reverse repurchase agreements are disclosed in Note 4 in the Notes to Financial Statements.</FONT></P>
<P>
<FONT size=1 face="serif">A category in the Coporate Bonds section may contain multiple industries as defined by the SEC&#146;s Standard Industry Codes.</FONT></P>
<center>
  <FONT size=2 face="serif">See Notes to Financial Statements.</FONT><BR>
</center>
<P align="center">
<FONT size=2 face="serif">11</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
	<TD colspan=5 align=left>
<B><FONT face="serif">PORTFOLIO OF INVESTMENTS</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD colspan=5 align=left>
<B><FONT face="serif">OCTOBER 31, 2004</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD colspan=5 align=left>
 &nbsp;<B><FONT size=2 face="serif">BlackRock Core Bond Trust (BHK)</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>
      </center></TD>
	<TD width=70% align=left>&nbsp;

	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
	</TD>
	<TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>
      </center></TD>
	<TD width=70% align=left>&nbsp;

	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
	</TD>
	<TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>&nbsp;
      </center></TD>
	<TD width=70% align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><FONT size=2
face="serif">Description</FONT></B>&nbsp;
	</TD>
	<TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
      </center></TD>
  </TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">LONG-TERM INVESTMENTS&#151;136.2%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Mortgage Pass-Through Securities&#151;20.1%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Federal Home Loan Mortgage Corp.,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=right>
<FONT size=1 face="serif">$</FONT>
	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,875</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">3.50%, 4/01/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,868,794</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">465</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">3.875%, 11/10/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">468,582</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,400</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.125%, 2/24/11</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,378,636</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,125</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.50%, 12/16/10</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,130,546</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">2,795 </FONT><SUP></SUP>
	</TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.75%, 12/08/10</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">2,835,863</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">98</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.00%, 5/01/34</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">98,036</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">9,894</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.50%, 11/01/18 - 9/01/33</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">10,143,867</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">5,558</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.00%, 9/01/10 - 12/01/18</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">5,838,547</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">735 </FONT><SUP></SUP>
	</TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.875%, 9/15/10</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">850,454</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">4,156 </FONT><SUP></SUP>
	</TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.00%, 3/15/10 - 9/01/31</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">4,789,546</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Federal National Mortgage Assoc.,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">870</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">1.75%, 6/16/06</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">856,045</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">3,675 </FONT></TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">2.35%, 4/05/07</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">3,599,185</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">2,570</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.50%, 5/01/19 - 8/01/19</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">2,579,540</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,280 </FONT></TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.75%, 2/21/13</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,275,635</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">16,350</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.00%, 11/01/17 - 2/01/34</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">16,673,116</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">9,066</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.50%, 1/01/18 - 7/01/34</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">9,255,954</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,540</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.75%, 2/15/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,662,461</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">3,102</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.00%, 3/01/17 - 10/01/34</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">3,227,776</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,450</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.625%, 9/15/09</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,641,661</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">770</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.00%, 1/01/31 - 7/01/32</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">817,731</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">6,425 </FONT><SUP></SUP>
	</TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.125%, 6/15/10</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">7,493,863</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">511</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Government National Mortgage Assoc., 5.50%, 5/15/33 - 9/15/33</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">523,426</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Small Business Administration,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. P10B, Class 1, 4.754%, 8/10/14</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,001,875</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">2,475</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. P10B, Class 1, 5.136%, 8/10/13</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">2,546,837</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Total Mortgage Pass-Through Securities</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">82,557,976</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=center>
<B><FONT size=2 face="serif">Agency Multiple Class Mortgage Pass-Through Securities&#151;1.0%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Federal Home Loan Mortgage Corp.,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 82, Class HJ, 9/25/32</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">2,079,375</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,686</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2825, Class VP, 6/15/15</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,754,097</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Total Agency Multiple Class Mortgage Pass-Through Securities</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">3,833,472</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Interest Only Asset-Backed Securities&#151;1.5%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Sterling Coofs Trust,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">42,564</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1, 4/15/29</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">3,780,244</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">30,350</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2, 3/30/30</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">2,418,516</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Total Interest Only Asset-Backed Securities</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">6,198,760</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Interest Only Mortgage-Backed Securities&#151;2.1%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Federal Home Loan Mortgage Corp.,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">4,150</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2579, Class HI, 8/15/17</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">462,600</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">9,079</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2611, Class QI, 9/15/32</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,717,898</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Federal National Mortgage Assoc.,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">13,659</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 64, Class QI, 1/25/33</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">2,638,838</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">37,000</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 90, Class JH, 12/31/49</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">3,948,594</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Total Interest Only Mortgage-Backed Securities</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">8,767,930</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Commercial Mortgage-Backed Securities&#151;3.3%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,993</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=center>
      <div align="left"><FONT size=1 face="serif">GMAC Commercial Mortgage Securities, Inc., Ser. C3, Class A2, 7.179%, 8/15/36</FONT>&nbsp;
      </div></TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">2,244,734</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,677</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=center>
      <div align="left"><FONT size=1 face="serif">Heller Financial Commercial Mortgage Asset Co., Ser. PH1, Class A2, 6.847%, 5/15/31</FONT>&nbsp;
      </div></TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,852,196</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,790</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">JP Morgan Commercial Mortgage Finance Corp., 7.371%, 8/15/32</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">2,044,413</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">3,070</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Morgan Stanley Cap. Trust I, Ser. HF2, Class A2, 6.48%, 11/15/30</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">3,346,123</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">3,500</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Salomon Brothers Mortgage Securities VII, Ser. C1, Class A2, 7.52%, 12/18/09</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">4,032,959</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Total Commercial Mortgage-Backed Securities</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">13,520,425</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Collateralized Mortgage Obligation&#151;0.8%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">3,453</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Structured Asset Securities Corp., Class A2, 3.45%, 2/25/32</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">3,255,612</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=center colspan=7>
<FONT size=2 face="serif">See Notes to Financial Statements.</FONT>
	</TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2 face="serif">12</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
	<TD colspan=5 align=left>
<B><FONT size=2 face="serif">BlackRock Core Bond Trust (BHK) (continued)</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>
      </center></TD>
	<TD width=70% align=left>&nbsp;

	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
	</TD>
	<TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>
      </center></TD>
	<TD width=70% align=left>&nbsp;

	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
	</TD>
	<TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>&nbsp;
      </center></TD>
	<TD width=70% align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><FONT size=2
face="serif">Description</FONT></B>&nbsp;
	</TD>
	<TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
      </center></TD>
  </TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">U.S. Government and Agency Securities&#151;36.2%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=right>
<FONT size=1 face="serif">$</FONT>
	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,670</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Aid to Israel, 5.50%, 4/26/24 - 9/18/33</FONT>&nbsp;
	</TD>
	<TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,769,898</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,050</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Resolution Funding Corp., zero coupon, 7/15/18 - 10/15/18</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">529,625</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">U.S. Treasury Bonds,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">63,900</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.50%, 8/15/28</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">69,640,776</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">3,860 </FONT></TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.00%, 2/15/26</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">4,455,135</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">3,245 </FONT><SUP></SUP>
	</TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.125%, 11/15/27</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">3,813,881</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">8,960</FONT>
	</TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.75%, 8/15/26</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">11,260,901</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">3,170 </FONT><SUP></SUP>
	</TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

	</TD>
	<TD width=70% align=left>
 &nbsp;<FONT size=1 face="serif">12.00%, 8/15/13</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">4,178,440</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">U.S. Treasury Notes,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">4,323 </FONT></TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">2.00%, 7/15/14</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">4,472,792</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">22,550 </FONT><SUP></SUP>
	</TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">2.375%, 8/31/06</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">22,493,625</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">18,800 </FONT><SUP></SUP>
	</TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">2.50%, 5/31/06 - 9/30/06</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">18,805,611</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">5,140 </FONT><SUP></SUP>
	</TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">2.75%, 6/30/06 - 8/15/07</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">5,161,672</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">255</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">3.125%, 5/15/07</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">257,629</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,900</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.25%, 8/15/14</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,932,946</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Total U.S. Government and Agency Securities</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">148,772,931</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Corporate Bonds&#151;61.3%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Aero &amp; Defense&#151;2.0%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">BE Aerospace, Inc., Ser. B, 8.00%, 3/01/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">3,030,000</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Lockheed Martin Corp.,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">380</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.20%, 5/01/36</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">464,790</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,175</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">8.50%, 12/01/29</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,571,868</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Northrop Grumman Corp.,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">615</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.079%, 11/16/06</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">624,231</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">380</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.125%, 2/15/11</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">438,174</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">960</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.875%, 3/01/26</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,185,552</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">NR</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">690</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Raytheon Co., 7.00%, 5/15/06</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">728,615</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>&nbsp;

	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">8,043,230</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Automotive&#151;2.1%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">A3</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">660</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">DaimlerChrysler NA Holding Corp., 7.45%, 3/01/27</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">729,091</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">B3</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,500</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Delco Remy Intl., Inc., 11.00%, 5/01/09</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,575,000</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">General Motors Acceptance Corp.,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Baa1</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,160</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">zero coupon, 12/01/12</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">705,098</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Baa1</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">4,129</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.875%, 9/15/11</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">4,291,600</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Baa1</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">330</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">8.00%, 11/01/31</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">340,725</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">BB-</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">892</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">TRW Automotive, Inc., 9.375%, 2/15/13</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,025,800</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>&nbsp;

	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">8,667,314</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Building &amp; Development&#151;0.8%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Hovnanian Enterprises, Inc., 10.50%, 10/01/07</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">3,465,000</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Basic Materials&#151;1.9%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">3,425</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Caraustar Industries, Inc., 9.875%, 4/01/11</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">3,724,687</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">3,600</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Lyondell Chemical Co., 9.50%, 12/15/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">3,915,000</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>&nbsp;

	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">7,639,687</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Conglomerates&#151;2.1%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">General Electric Cap. Corp.,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">2,200</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">1.762%, 7/28/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">2,201,320</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">6,385</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">3.60%, 10/15/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">6,382,893</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>&nbsp;

	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">8,584,213</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Consumer Products&#151;2.5%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">A-</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">465 </FONT><SUP></SUP>
	</TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">CVS Corp., 4.875%, 9/15/14</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">468,371</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">A+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,680</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Diageo Cap. PLC, 3.375%, 3/20/08 (United Kingdom)</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,677,917</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,010</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">General Mills, Inc., 5.125%, 2/15/07</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,052,824</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">990</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Kellogg Co., Ser. B, 6.60%, 4/01/11</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,121,027</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">A3</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">865</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Kraft Foods, Inc., 5.625%, 11/01/11</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">920,637</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">650</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Kroger Co., 6.80%, 4/01/11</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">734,137</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Pantry, Inc., The, 7.75%, 2/15/14</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,047,500</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">2,100</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Sonic Automotive, Inc., Ser. B, 8.625%, 8/15/13</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">2,215,500</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Stoneridge, Inc., 11.50%, 5/01/12</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,122,500</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>&nbsp;

	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">10,360,413</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=center colspan=7>
<FONT size=2 face="serif">See Notes to Financial Statements.</FONT>
	</TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2 face="serif">13</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
	<TD colspan=5 align=left>
<B><FONT size=2 face="serif">BlackRock Core Bond Trust (BHK) (continued)</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>
      </center></TD>
	<TD width=70% align=left>&nbsp;

	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
	</TD>
	<TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>
      </center></TD>
	<TD width=70% align=left>&nbsp;

	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
	</TD>
	<TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>&nbsp;
      </center></TD>
	<TD width=70% align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><FONT size=2
face="serif">Description</FONT></B>&nbsp;
	</TD>
	<TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
      </center></TD>
  </TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Containers &amp; Glass&#151;0.7%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
	</TD>
	<TD width=4% align=right>
<FONT size=1 face="serif">$</FONT>
	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Crown European Holdings SA, 10.875%, 3/01/13 (France)</FONT>&nbsp;
	</TD>
	<TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,190,000</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">BB-</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,500</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Owens-Brockway Glass Container, Inc., 8.75%, 11/15/12</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,680,000</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>&nbsp;

	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">2,870,000</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Ecological Services &amp; Equipment&#151;0.7%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">2,825</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Allied Waste NA, Inc., Ser. B, 10.00%, 8/01/09</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">2,952,125</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Energy&#151;7.8%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">BBB-</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,650</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Amerada Hess Corp., 7.125%, 3/15/33</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,814,241</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,315</FONT>
	</TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Anadarko Finance Co., Ser. B, 7.50%, 5/01/31 (Canada)</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,631,968</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">CCC+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Calpine Canada Energy Finance LLC, 8.50%, 5/01/08 (Canada)</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">615,000</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,250</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Chesapeake Energy Corp., 9.00%, 8/15/12</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,439,062</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Compagnie Generale de Geophysique SA, 10.625%, 11/15/07 (France)</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,058,000</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">A-</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,800</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Conoco Funding Co., 6.35%, 10/15/11 (Canada)</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">2,021,760</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">A-</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">350</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">ConocoPhillips Holding Co., 6.95%, 4/15/29</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">410,833</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,915</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Devon Energy Corp., 7.95%, 4/15/32</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">2,438,580</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">230</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Devon Financing Corp. LLC, 7.875%, 9/30/31</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">290,060</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">150</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Dominion Resources, Inc., 5.70%, 9/17/12</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">158,945</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Dresser, Inc., 9.375%, 4/15/11</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">3,345,000</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,875 </FONT></TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Dynegy Holdings, Inc., 10.125%, 7/15/13</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">2,184,375</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">El Paso Natural Gas Co.,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">B1</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">850</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.625%, 8/01/10</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">921,187</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">B1</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">265</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">8.625%, 1/15/22</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">298,125</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">2,250</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">El Paso Production Holding Co., 7.75%, 6/01/13</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">2,351,250</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">EnCana Corp.,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">A-</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,810</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.75%, 10/15/13 (Canada)</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,812,407</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">A-</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">350</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.50%, 8/15/34 (Canada)</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">381,231</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">305</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Exelon Corp., 6.75%, 5/01/11</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">342,341</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">BBB-</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,420</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">FirstEnergy Corp., Ser. C, 7.375%, 11/15/31</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,617,962</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">360</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Occidental Petroleum Corp., 7.20%, 4/01/28</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">428,246</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AA</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">835</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Ontario Electricity Financial Corp., 6.10%, 1/30/08 (Canada)</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">908,346</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">790</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Peco Energy Cap. Trust IV, 5.75%, 6/15/33</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">744,098</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Baa1</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,650</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Petroleos Mexicanos, 9.375%, 12/02/08 (Mexico)</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,947,000</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Aa1</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">290 </FONT></TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">SP PowerAssets Ltd., 5.00%, 10/22/13 (Singapore)</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">296,490</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">A-</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">445</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Suncor Energy, Inc., 5.95%, 12/01/34 (Canada)</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">463,852</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AA</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,050</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Texaco Cap. Inc., 8.875%, 9/01/21</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,483,293</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">A3</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">725</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Virginia Electric &amp; Power Co., Ser. A, 5.75%, 3/31/06</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">753,536</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>&nbsp;

	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">32,157,188</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Entertainment &amp; Leisure&#151;0.5%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Circus &amp; Eldorado Joint Venture, 10.125%, 3/01/12</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,085,000</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Resorts Intl. Hotel &amp; Casino, Inc., 11.50%, 3/15/09</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,152,500</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>&nbsp;

	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">2,237,500</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Financial Institutions&#151;23.2%</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">A-</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">350</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">ACE, Ltd., 6.00%, 4/01/07 (Cayman Island)</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">369,446</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AA+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">455</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Associates Corp. of North America, 6.95%, 11/01/18</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">536,404</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Bank of America Corp.,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Aa2</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">765</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">3.25%, 8/15/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">758,390</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Aa2</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,640</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">3.375%, 2/17/09</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,621,878</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Aa2</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">3.875%, 1/15/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,017,750</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Aa2</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">105</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.375%, 12/01/10</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">106,532</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Aa2</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">370</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.25%, 2/01/07</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">387,901</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Aa2</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">470</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.375%, 6/15/14</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">492,395</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Aa3</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,225</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.40%, 1/15/11</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,436,827</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Bank One Corp.,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Aa2</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">325</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">3.70%, 1/15/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">328,029</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Aa3</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">725</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.00%, 8/01/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">786,328</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Aa2</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,400</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">BankBoston NA, 6.375%, 3/25/08 - 4/15/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,531,926</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Aa3</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">565 </FONT><SUP></SUP>
	</TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Barclays Bank PLC, 8.55%, 9/29/49 (United Kingdom)</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">695,825</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,200 </FONT></TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Berkshire Hathaway Finance Corp., 3.40%, 7/02/07</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,205,364</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AA+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">600</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">CitiFinancial, 6.25%, 1/01/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">651,210</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=7>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=center colspan=7>
<FONT size=2 face="serif">See Notes to Financial Statements.</FONT>
	</TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2 face="serif">14</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
	<TD colspan=5 align=left>
<B><FONT size=2 face="serif">BlackRock Core Bond Trust (BHK) (continued)</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=7>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>
      </center></TD>
	<TD width=70% align=left>&nbsp;

	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
	</TD>
	<TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>
      </center></TD>
	<TD width=70% align=left>&nbsp;

	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
	</TD>
	<TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>&nbsp;
      </center></TD>
	<TD width=70% align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><FONT size=2
face="serif">Description</FONT></B>&nbsp;
	</TD>
	<TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
      </center></TD>
  </TR>
<TR>
	<TD colspan=7>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<B><FONT size=2 face="serif">Financial Institutions&#151;(cont&#146;d)</FONT></B>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Citigroup, Inc.,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Aa1</FONT>&nbsp;
	</TD>
	<TD width=4% align=right>
<FONT size=1 face="serif">$</FONT>
	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,960</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.25%, 7/29/09</FONT>&nbsp;
	</TD>
	<TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">2,004,355</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AA</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">5,099 </FONT></TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.00%, 9/15/14</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">5,145,707</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AA</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">185</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.00%, 10/31/33</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">191,436</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Crum &amp; Forster Holdings Corp., 10.375%, 6/15/13</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,070,000</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">HBOS Treasury Services PLC,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AA+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">855 </FONT></TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">3.60%, 8/15/07 (United Kingdom)</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">862,344</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AA+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">825 </FONT><SUP></SUP>
	</TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">3.75%, 9/30/08 (United Kingdom)</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">831,749</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Household Finance Corp.,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">A+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,760</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.375%, 8/01/10 - 11/27/12</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,956,417</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">A+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">2,325</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.75%, 5/15/11</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">2,641,991</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">HSBC Bank USA, Inc.,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AA</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,850</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">3.875%, 9/15/09</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,857,418</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AA-</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">775</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.875%, 11/01/34</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">774,225</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">JP Morgan Chase &amp; Co.,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Aa3</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">540</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">3.625%, 5/01/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">543,003</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Aa3</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,600</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.25%, 5/30/07</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,682,736</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Aa3</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">600</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.35%, 3/01/07</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">630,030</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">A1</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">325</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.625%, 3/15/12</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">366,977</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">A1</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,155</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.75%, 2/01/11</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,308,349</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Marsh &amp; McLennan Cos, Inc.,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">250</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">2.193%, 7/13/07</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">241,788</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">265</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.375%, 7/15/14</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">258,025</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AA</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,415 </FONT><SUP></SUP>
	</TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">MetLife Global Funding I, 4.25%, 7/30/09</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,427,707</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AA+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">450 </FONT><SUP></SUP>
	</TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Monumental Global Funding II, 4.375%, 7/30/09</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">458,294</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">A3</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">20,300 </FONT></TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Morgan Stanley Tracers, 5.838%, 3/01/07</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">21,231,567</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">National City Bank Cleveland Ohio,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AA-</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">800</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">2.09%, 6/29/09</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">800,104</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AA-</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,200</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">3.375%, 10/15/07</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,203,756</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AA-</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">2,125 </FONT></TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Nationwide Building Society, 3.50%, 7/31/07 (United Kingdom)</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">2,136,730</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">850</FONT>
	</TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">New York Life Global Funding, 3.875%, 1/15/09</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">854,760</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AA</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,500</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Protective Life Secured Trust, 3.70%, 11/24/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,508,775</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">A+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,000 </FONT><SUP></SUP>
	</TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Prudential Funding LLC, 6.60%, 5/15/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,098,390</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AA</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">400 </FONT><SUP></SUP>
	</TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Rabobank Cap. Fund II, 5.26%, 12/29/49</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">402,076</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Rainbow National Services LLC,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">B3</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">200 </FONT><SUP></SUP>
	</TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">8.75%, 9/01/12</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">214,000</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">CCC+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">600 </FONT><SUP></SUP>
	</TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">10.375%, 9/01/14</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">651,000</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">SLM Corp.,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">A+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">4,220</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">3.625%, 3/17/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">4,241,522</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">A+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,350</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.00%, 10/01/13</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,373,125</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">A+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">450</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.375%, 1/15/13</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">470,088</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">A+</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">90</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.625%, 4/10/07</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">94,977</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">NR</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">3,882</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Structured Asset Receivable Trust, 1.649%, 1/21/10</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">3,875,888</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AA</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,265</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">SunTrust Bank, Inc., 4.415%, 6/15/09</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,296,752</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AA-</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,635</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">SunTrust Banks, Inc., 3.625%, 10/15/07</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,650,434</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">225 </FONT><SUP></SUP>
	</TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">TIAA Global Markets, Inc., 3.875%, 1/22/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">228,645</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AA-</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">375</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">U.S. Bancorp, Ser. N, 3.95%, 8/23/07</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">382,853</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">US Bank National Assoc.,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Aa2</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,380</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">2.87%, 2/01/07</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,382,650</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Aa3</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">2,790</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.50%, 2/01/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">3,055,775</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Wachovia Corp.,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Aa3</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">4,200</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">3.50%, 8/15/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">4,202,982</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Aa3</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">975</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">3.625%, 2/17/09</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">971,948</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Wells Fargo &amp; Co.,</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Aa1</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">2,040</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">1.98%, 9/15/09</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">2,039,306</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Aa1</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">650</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">2.03%, 9/28/07</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">649,428</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Aa1</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,031</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">3.12%, 8/15/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">1,029,330</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Aa1</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">1,975</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.00%, 8/15/08</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">2,011,459</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">Aa1</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">200</FONT>
	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.80%, 6/15/10</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">206,197</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=center>
<FONT size=1 face="serif">AA</FONT>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=right>
<FONT size=1 face="serif">85 </FONT><SUP></SUP>
	</TD>
	<TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

	</TD>
	<TD width=70% align=left>
<FONT size=1 face="serif">Western &amp; Southern Financial Group, Inc., 5.75%, 7/15/33</FONT>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">84,261</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=3% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=70% align=left>&nbsp;

	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=9% align=right>
<FONT size=1 face="serif">95,527,534</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=5>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=center colspan=7>
<FONT size=2 face="serif">See Notes to Financial Statements.</FONT>
	</TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2 face="serif">15</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<p></p>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT size=2 face="serif">BlackRock Core Bond Trust (BHK) (continued)</FONT></B>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=left>&nbsp;

        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>
      </center></TD>
        <TD width="70%" align=left>&nbsp;

        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>
      </center></TD>
        <TD width="70%" align=left>&nbsp;

        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>&nbsp;
      </center></TD>
        <TD width="70%" align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><FONT size=2
face="serif">Description</FONT></B>&nbsp;
        </TD>
        <TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
      </center></TD>
  </TR>
<TR>
        <TD colspan=7>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=left>&nbsp;

        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=left>

        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
<B><FONT size=2 face="serif">Health Care&#151;2.3%</FONT></B>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">A</FONT>&nbsp;
        </TD>
        <TD width="4%" align=right>
<FONT size=1 face="serif">$</FONT>
        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">410</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
<FONT size=1 face="serif">Boston Scientific Corp., 5.45%, 6/15/14</FONT>&nbsp;
        </TD>
        <TD width="1%" align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">432,214</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">A+</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">1,055</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
<FONT size=1 face="serif">Bristol Myers Squibb Co., 5.75%, 10/01/11</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">1,138,303</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">NR</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
<FONT size=1 face="serif">HealthSouth Corp., 7.625%, 6/01/12</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">1,940,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=left>&nbsp;

        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=left>

        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
<FONT size=1 face="serif">Tenet Healthcare Corp.,</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">380</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.375%, 12/01/11</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">346,750</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">5</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.50%, 6/01/12</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">4,538</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">865 </FONT><SUP></SUP>
        </TD>
        <TD width="3%" align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width="70%" align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">9.875%, 7/01/14</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">906,087</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
<FONT size=1 face="serif">United Surgical Partners Intl., Inc., 10.00%, 12/15/11</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">2,295,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">A</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">1,210</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
<FONT size=1 face="serif">UnitedHealth Group, Inc., 3.375%, 8/15/07</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">1,206,854</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">A</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">1,025</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
<FONT size=1 face="serif">Wyeth, 6.50%, 2/01/34</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">1,061,643</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=left>&nbsp;

        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=left>

        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>&nbsp;

        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">9,331,389</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=left>&nbsp;

        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=left>

        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
<B><FONT size=2 face="serif">Industrials&#151;0.7%</FONT></B>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">760</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
<FONT size=1 face="serif">Allegiance Corp., 7.00%, 10/15/26</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">791,175</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
<FONT size=1 face="serif">Terex Corp., 9.25%, 7/15/11</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">2,250,000</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=left>&nbsp;

        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=left>

        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>&nbsp;

        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">3,041,175</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=left>&nbsp;

        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=left>

        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
<B><FONT size=2 face="serif">Media&#151;5.4%</FONT></B>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">B1</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">4,000</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
<FONT size=1 face="serif">Alliance Atlantis Communications, Inc., 13.00%, 12/15/09 (Canada)</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">4,300,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=left>&nbsp;

        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=left>

        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
<FONT size=1 face="serif">AOL Time Warner, Inc.,</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">80</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.125%, 4/15/06</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">83,613</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">90</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.625%, 5/15/29</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">94,531</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">4,155</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.57%, 2/01/24</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">4,788,014</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">205</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.625%, 4/15/31</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">242,375</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">275</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">9.15%, 2/01/23</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">360,968</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">580</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
<FONT size=1 face="serif">AT&amp;T Broadband Corp., 8.375%, 3/15/13</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">711,503</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">CCC+</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">750</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
<FONT size=1 face="serif">Charter Communications Holdings II, LLC, 10.25%, 9/15/10</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">780,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">CCC+</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">3,250</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
<FONT size=1 face="serif">Charter Communications Holdings LLC, 10.75%, 10/01/09</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">2,746,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=left>&nbsp;

        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=left>

        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
<FONT size=1 face="serif">Comcast Corp.,</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">4,405</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.50%, 3/15/11</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">4,645,954</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">80</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.05%, 3/15/33</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">90,398</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=left>&nbsp;

        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=left>

        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
<FONT size=1 face="serif">News America Holdings, Inc.,</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">985</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.625%, 11/30/28</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">1,175,775</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">825</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.70%, 10/30/25</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">985,396</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=left>&nbsp;

        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=left>

        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
<FONT size=1 face="serif">TCI Communications, Inc.,</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">200</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.125%, 2/15/28</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">222,826</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">865</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.875%, 8/01/13 - 2/15/26</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">1,035,551</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=left>&nbsp;

        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=left>

        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>&nbsp;

        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">22,263,154</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=left>&nbsp;

        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=left>

        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
<B><FONT size=2 face="serif">Real Estate&#151;2.8%</FONT></B>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">3,165 </FONT><SUP></SUP>
        </TD>
        <TD width="3%" align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width="70%" align=left>
<FONT size=1 face="serif">American Real Estate Partners LP, 8.125%, 6/01/12</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">3,339,075</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=left>&nbsp;

        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=left>

        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
<FONT size=1 face="serif">AvalonBay Communities, Inc.,</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">350</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.625%, 9/15/11</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">389,098</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">775</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">8.25%, 7/15/08</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">892,591</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=left>&nbsp;

        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=left>

        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
<FONT size=1 face="serif">EOP Operating LP,</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">1,150</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.65%, 10/01/10</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">1,157,003</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">950</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.75%, 3/15/14</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">930,183</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">450</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.00%, 7/15/11</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">509,099</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=left>&nbsp;

        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=left>

        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
<FONT size=1 face="serif">ERP Operating LP,</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">A-</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">1,950</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.20%, 4/01/13</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">1,991,028</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">A-</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">825</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.95%, 3/02/11</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">935,913</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=left>&nbsp;

        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=left>

        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
<FONT size=1 face="serif">Rouse Co.,</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">BBB-</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">895</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">3.625%, 3/15/09</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">843,242</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=center>
<FONT size=1 face="serif">BBB-</FONT>&nbsp;
        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=right>
<FONT size=1 face="serif">340</FONT>
        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.375%, 11/26/13</FONT>&nbsp;
        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">325,724</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" align=left>&nbsp;

        </TD>
        <TD width="4%" align=left>

        </TD>
        <TD width="3%" align=left>

        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="70%" align=left>&nbsp;

        </TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="9%" align=right>
<FONT size=1 face="serif">11,312,956</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
</TABLE>
<center>
  <BR>
  <FONT size=2 face="serif">See Notes to Financial Statements.</FONT><BR>
</center>
<P align="center">
<FONT size=2 face="serif">16</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT size=2 face="serif">BlackRock Core Bond Trust (BHK) (continued)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>&nbsp;
      </center></TD>
        <TD width=70% align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><FONT size=2
face="serif">Description</FONT></B>&nbsp;
        </TD>
        <TD colspan="2" align=left>      <center>
          <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
    </center></TD>
  </TR>
<TR>
        <TD colspan=7>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Telecommunications&#151;5.0%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A</FONT>&nbsp;
        </TD>
        <TD width=4% align=right>
<FONT size=1 face="serif">$</FONT>
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,400</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">BellSouth Corp., 5.20%, 9/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,465,178</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">650</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">British Telecommunications PLC, 8.875%, 12/15/30 (United Kingdom)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">869,050</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">25</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Deutsche Telekom Intl. Finance BV, 8.75%, 6/15/30 (Netherlands)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">33,001</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Nextel Communications, Inc., 9.375%, 11/15/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,097,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,750 </FONT><SUP></SUP>
        </TD>
        <TD width=35 align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Qwest Communications Intl., 7.50%, 2/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,680,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">200 </FONT><SUP></SUP>
        </TD>
        <TD width=35 align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Qwest Corp., 7.875%, 9/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">212,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">SBC Communications, Inc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">325</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.125%, 9/15/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">324,928</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,050</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.10%, 9/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,061,152</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">875</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.45%, 6/15/34</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">918,969</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,065</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Sprint Capital Corp., 6.875%, 11/15/28</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,144,162</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,875 </FONT></TD>
        <TD width=35 align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Telecom Italia Capital, 6.00%, 9/30/34 (Luxembourg)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,841,213</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">725</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Telefonica Europe BV, 7.75%, 9/15/10 (Netherlands)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">860,089</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">75</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Verizon Global Funding Corp., 7.75%, 12/01/30</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">91,707</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Aa3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">125</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Verizon Maryland, Inc., 5.125%, 6/15/33</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">109,936</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Verizon New Jersey, Inc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Aa3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">230</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.85%, 11/15/29</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">281,591</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Aa3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">335</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. A, 5.875%, 1/17/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">360,681</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,439</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Vodafone Group PLC, 7.75%, 2/15/10 (United Kingdom)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,048,391</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">20,400,048</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Transportation&#151;0.8%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,450</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Canadian Pacific Railway Ltd., 6.25%, 10/15/11 (Canada)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,606,571</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,635</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Sea Containers Ltd., 10.50%, 5/15/12 (Bermuda)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,696,313</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,302,884</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Corporate Bonds</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">252,155,810</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Taxable Municipal Bonds&#151;0.2%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A2</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">650</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">California Dept. of Wtr. Res. Pwr. Sply., 3.975%, 5/01/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">654,108</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">350</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Ohana Military Cmntys. LLC, 6.193%, 4/01/49</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">364,350</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Taxable Municipal Bonds</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,018,458</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Foreign Government Bonds&#151;9.7%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,855</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Canada Government, 5.00%, 6/01/14 CAD</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,139,367</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">NR</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,600</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">French Treasury Note, 3.50%, 1/12/09 EUR</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5,958,044</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5,135</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Germany Federal Republic, 3.25%, 4/17/09 EUR</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">6,578,758</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Aaa</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">7,125</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Kingdom of Spain, 3.60%, 1/31/09 EUR</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">9,262,565</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">33,885</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Kingdom of Sweden, 5.00%, 1/28/09 SEK</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5,043,499</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AA-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Quebec Province Canada, 5.00%, 7/17/09 USD</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,110,480</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">United Mexican States,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Baa2</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,000</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.625%, 3/03/15 USD</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,284,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Baa2</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,255</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">8.00%, 9/24/22 USD</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,589,868</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Foreign Government Bonds</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">39,966,581</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=1 face="serif">Total Long-Term Investments </FONT></B><FONT size=1 face="serif">(cost $543,718,526)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">560,047,955</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">SHORT-TERM INVESTMENTS&#151;4.4%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Corporate Bond&#151;0.5%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Financial Institutions&#151;0.5%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">NR</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,900 </FONT><SUP></SUP>
        </TD>
        <TD width=35 align=left><SUP><FONT size=1 face="serif">2,4</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">HBOS Treasury Services PLC, 2.04%, 1/26/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,890,741</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">U.S. Government and Agency Securities&#151;3.9%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">400</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal Home Loan Bank, 1.69%, 11/01/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">400,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">U.S. Treasury Bonds,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">537</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">1.55%, 11/05/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">536,625</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">15,261</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">1.62%, 11/05/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">15,261,125</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=1 face="serif">Total U.S. Government and Agency Securities</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">16,197,750</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=1 face="serif">Total Short-Term Investments </FONT></B><FONT size=1 face="serif">(cost $18,088,491)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">18,088,491</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR align="left" size=1 noshade>
        </TD>
</TR>
</TABLE>
<center>
  <BR>
  <FONT size=2 face="serif">See Notes to Financial Statements.</FONT><BR>
</center>
<P align="center">
<FONT size=2 face="serif">17</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD colspan=4 align=left>
<B><FONT size=2 face="serif">BlackRock Core Bond Trust (BHK) (continued)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan="2" align=center>
      <center>
        <B><FONT size=2 face="serif">Contracts/</FONT></B>
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan="2" align=right>
      <center>
        <B><FONT size=2 face="serif">Notional</FONT></B>
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>         <center>
            <B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
      </center></TD>
        <TD colspan="2" align=right>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=right>
      <center>
        <B><FONT size=2 face="serif">(unaudited)</FONT></B>
    </center></TD>
        <TD colspan=2 align=right><center>
    <B><FONT size=2 face="serif"> (000)</FONT></B>        </center></TD>
        <TD width=70% align=center>
<B><FONT size=2 face="serif">Description</FONT></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>

          <center>
      <B><FONT size=2 face="serif">Value</FONT></B>         </center></TD>
  </TR>
<TR>
        <TD colspan=7>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=8% align=left>

        </TD>
        <TD width=2% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">OUTSTANDING OPTIONS PURCHASED&#151;0.1%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=8% align=left>

        </TD>
        <TD width=2% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Interest Rate Swap,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=8% align=right>
<FONT size=1 face="serif">$&nbsp;&nbsp;&nbsp;23,000</FONT>
        </TD>
        <TD width=2% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.365% over 3-month LIBOR, expires 1/28/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD align=right>
<FONT size=1 face="serif">225,484</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=8% align=right>
<FONT size=1 face="serif">16,000</FONT>
        </TD>
        <TD width=2% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.60% over 3-month LIBOR, expires 11/19/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">26,848</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=8% align=right>
<FONT size=1 face="serif">23,000</FONT>
        </TD>
        <TD width=2% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.865% over 3-month LIBOR, expires 1/28/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">157,555</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=8% align=right>
<FONT size=1 face="serif">12,000</FONT>
        </TD>
        <TD width=2% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.25% over 3-month LIBOR, expires 11/19/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">12</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=4>
        </TD>
        <TD colspan=3>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=8% align=left>

        </TD>
        <TD width=2% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=1 face="serif">Total Outstanding Options Purchased </FONT></B><FONT size=1 face="serif">(cost $468,300)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">409,899</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=4>
        </TD>
        <TD colspan=3>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=8% align=left>

        </TD>
        <TD width=2% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=1 face="serif">Total investments before outstanding options written </FONT></B><FONT size=1 face="serif">(cost $562,275,317)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">578,546,345</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=4>
        </TD>
        <TD colspan=3>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=8% align=left>

        </TD>
        <TD width=2% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">OUTSTANDING OPTIONS WRITTEN&#151;(0.3)%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=8% align=left>

        </TD>
        <TD width=2% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Interest Rate Swap,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=8% align=right>
<FONT size=1 face="serif">(26,000</FONT>
        </TD>
        <TD width=2% align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">3.00% over 3-month LIBOR, expires 1/19/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">(75,258</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=8% align=right>
<FONT size=1 face="serif">(23,000</FONT>
        </TD>
        <TD width=2% align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.375% over 3-month LIBOR, expires 10/28/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">(434,286</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=8% align=right>
<FONT size=1 face="serif">(28,700</FONT>
        </TD>
        <TD width=2% align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.60% over 3-month LIBOR, expires 2/23/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">(250,637</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=8% align=right>
<FONT size=1 face="serif">(39,000</FONT>
        </TD>
        <TD width=2% align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.75% over 3-month LIBOR, expires 9/23/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">(91,650</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=8% align=right>
<FONT size=1 face="serif">(23,000</FONT>
        </TD>
        <TD width=2% align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.75% over 3-month LIBOR, expires 10/28/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">(387,883</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=8% align=right>
<FONT size=1 face="serif">(12,000</FONT>
        </TD>
        <TD width=2% align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.05% over 3-month LIBOR, expires 2/23/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">(5,040</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=8% align=right>
<FONT size=1 face="serif">(90</FONT>
        </TD>
        <TD width=2% align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">U.S. Treasury Bond Futures, expires 11/26/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">(92,812</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=8% align=right>
<FONT size=1 face="serif">(90</FONT>
        </TD>
        <TD width=2% align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">U.S. Treasury Bond Futures, expires 11/26/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">(1,406</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=4>
        </TD>
        <TD colspan=3>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=8% align=left>

        </TD>
        <TD width=2% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=1 face="serif">Total Outstanding Options Written </FONT></B><FONT size=1 face="serif">(premium received $2,196,443)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">(1,338,972</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=4>
        </TD>
        <TD colspan=3>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=8% align=left>

        </TD>
        <TD width=2% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=1 face="serif">Total investments, net of outstanding options written&#151;140.4%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD align=right>
<FONT size=1 face="serif">577,207,373</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=8% align=left>

        </TD>
        <TD width=2% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Liabilities in excess of other assets&#151;(40.4%)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
      <FONT size=1 face="serif">(166,044,115</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR>
  <TD colspan=4></TD>
  <TD colspan=3><HR align="left" size=1 noshade>
  </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=8% align=left>

        </TD>
        <TD width=2% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=1 face="serif">Net Assets&#151;100%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD align=right>
<FONT size=1 face="serif">411,163,258</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=4>
        </TD>
        <TD colspan=3>
<HR align="left" size=3 noshade>
        </TD>
</TR>
</TABLE>
<BR>
<TABLE border=0 cellspacing=0 cellpadding=0>
<TR valign="top">
  <TD colspan="2" nowrap><HR align="left" width="100" size=1 noshade></TD>
  </TR>
<TR valign="top">
        <TD nowrap>
<SUP><FONT size=1 face="serif">1</FONT></SUP>&nbsp; &nbsp; &nbsp;       </TD>
        <TD>
<FONT size=1 face="serif">Using the higher of S&amp;P&#146;s, Moody&#146;s or Fitch&#146;s rating.</FONT>       </TD>
</TR>
<TR valign="top">
        <TD nowrap>
<SUP><FONT size=1 face="serif">2</FONT></SUP>&nbsp; &nbsp; &nbsp;       </TD>
        <TD>
<FONT size=1 face="serif">Entire or partial principal amount pledged as collateral for reverse repurchase agreements or financial futures contracts.</FONT>     </TD>
</TR>
<TR valign="top">
        <TD nowrap>
<SUP><FONT size=1 face="serif">3</FONT></SUP>   </TD>
        <TD>
<FONT size=1 face="serif">Security is not registered under the Securities Act of 1933. These securities may be resold in transactions in accordance with Rule 144A under that Act, to qualified institutional buyers. As of October 31, 2004, the Trust
held 11.8% of its net assets, with a current market value of $48,456,530, in securities restricted as to resale.</FONT></TD>
</TR>
<TR valign="top">
        <TD nowrap>
<SUP><FONT size=1 face="serif">4</FONT></SUP>&nbsp; &nbsp; &nbsp;       </TD>
        <TD>
<FONT size=1 face="serif">This bond is borrowed. The rate shown is the yield on the collateral deposited with the counterparty.</FONT>  </TD>
</TR>
</TABLE>
<P>
<FONT size=1 face="serif">Details of open reverse repurchase agreements are disclosed in Note 4 in the Notes to Financial Statements.</FONT></P>
<P>
<FONT size=1 face="serif">A category in the Coporate Bonds section may contain multiple industries as defined by the SEC&#146;s Standard Industry Codes.</FONT></P>
<TABLE width="30%" border=0 align="center" cellpadding=0 cellspacing=0>
<TR valign="bottom">
  <TD colspan="2" align=left><hr size="1" noshade></TD>
</TR>
<TR valign="bottom">
  <TD colspan="2" align=left>
      <center>
        <B><FONT size=1 face="serif">KEY TO ABBREVIATIONS</FONT></B>&nbsp;
      </center></TD>
  </TR>
<TR>
  <TD width="32%">&nbsp;</TD>
        <TD width="68%">&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD align=left>&nbsp;</TD>
        <TD align=left nowrap>
<FONT size=1 face="serif">CAD &#150; Canadian Dollar</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD align=left>&nbsp;</TD>
        <TD align=left nowrap>
<FONT size=1 face="serif">EUR &#150; European Monetary Unit</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD align=left>&nbsp;</TD>
        <TD align=left nowrap>
<FONT size=1 face="serif">SEK &#150; Swedish Krona</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD align=left>&nbsp;</TD>
        <TD align=left nowrap>
<FONT size=1 face="serif">USD &#150; U.S. Dollar</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD colspan="2" align=left><hr size="1" noshade></TD>
  </TR>
</TABLE>
<center>
  <BR>
  <FONT size=2 face="serif">See Notes to Financial Statements.</FONT><BR>
</center>
<P align="center">
<FONT size=2 face="serif">18</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT face="serif">PORTFOLIO OF INVESTMENTS</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;


        </TD>
</TR>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT face="serif">OCTOBER 31, 2004</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD colspan=5 align=left>
 &nbsp;<B><FONT size=2 face="serif">BlackRock High Yield Trust (BHY)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>&nbsp;
      </center></TD>
        <TD width=70% align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><FONT size=2
face="serif">Description</FONT></B>&nbsp;
        </TD>
        <TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
      </center></TD>
  </TR>
<TR>
        <TD colspan=7>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">LONG-TERM INVESTMENTS&#151;134.4%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Corporate Bonds&#151;133.8%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Aero &amp; Defense&#151;2.8%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">AAR Corp.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=right>
<FONT size=1 face="serif">$</FONT>
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">435</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.875%, 12/15/07</FONT>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">438,263</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">NR</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">100</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. A2, 8.39%, 5/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">97,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">250</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Argo Tech Corp., 9.25%, 6/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">272,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">BE Aerospace, Inc., 8.50%, 10/01/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">548,125</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">NR</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,500</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3,4,5</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Condor Systems, Inc., Ser. B, 11.875%, 5/01/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">30,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">30</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Titan Corp., 8.00%, 5/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">31,800</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,418,188</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Automotive&#151;2.4%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">325</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">ArvinMeritor, Inc., 8.75%, 3/01/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">360,750</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B1</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">300</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Delco Remy Intl., Inc., 6.07%, 1/18/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">301,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">280</FONT></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Metaldyne Corp., 10.00%, 11/01/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">267,400</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">265</FONT></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Stanadyne Corp., 10.00%, 8/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">278,250</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,207,900</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Basic Materials&#151;18.2%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">55</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Alaska Steel Corp., 7.75%, 6/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">55,688</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">250</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Arch Western Finance LLC, 6.75%, 7/01/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">265,375</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">450 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">BCP Caylux Holdings SCA, 9.625%, 6/15/14 (Luxembourg)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">504,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">165</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Blount, Inc., 8.875%, 8/01/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">178,200</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Boise Cascade LLC,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">50</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.005%, 1/15/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">51,375</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">155</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.125%, 10/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">162,750</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">215</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Bowater Canada Finance Corp., 7.95%, 11/15/11 (Canada)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">231,931</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">70</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Caraustar Industries, Inc., 9.875%, 4/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">76,125</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">175</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Cascades, Inc., 7.25%, 2/15/13 (Canada)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">188,125</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">305</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Century Aluminum Co., 7.50%, 8/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">324,825</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">50</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Equistar Chemicals LP, 10.125%, 9/01/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">57,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B1</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">200 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Foundation Pennsylvania Coal Co., 7.25%, 8/01/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">212,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Georgia Pacific Corp.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">20</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.25%, 6/01/28</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">21,200</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">550</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">8.00%, 1/15/24</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">638,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B2</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">188</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Gold Kist, Inc., 10.25%, 3/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">212,440</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">400</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Huntsman Intl. LLC, 10.125%, 7/01/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">420,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">100</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Huntsman LLC, 11.625%, 10/15/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">117,875</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">680</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Intl. Steel Group, Inc., 6.50%, 4/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">724,200</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">425</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Ipsco, Inc., 8.75%, 6/01/13 (Canada)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">487,688</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">470</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Ispat Inland ULC, 9.75%, 4/01/14 (Canada)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">568,700</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">175</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">JSG Funding PLC, 9.625%, 10/01/12 (Ireland)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">199,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Lyondell Chemical Co.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">250</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">10.875%, 5/01/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">265,938</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">230</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. A, 9.625%, 5/01/07</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">252,425</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">400</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Millar Western Forest Products Ltd., 7.75%, 11/15/13 (Canada)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">427,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">65</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Millennium America, Inc., 9.25%, 6/15/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">72,475</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Nalco Co.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B2</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">50</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.75%, 11/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">53,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">8.875%, 11/15/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">547,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">125</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Norske Skog Canada Ltd., 7.375%, 3/01/14 (Canada)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">130,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">335</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Nova Chemicals Corp., 6.50%, 1/15/12 (Canada)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">349,985</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">300</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Polypore, Inc., 8.75%, 5/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">313,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">5</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Republic Technologies Intl. LLC, 13.75%, 7/15/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">0</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">385</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Rhodia, 10.25%, 6/01/10 (France)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">414,838</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">125</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Russel Metals, Inc., 6.375%, 3/01/14 (Canada)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">125,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">75</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Smurfit Captial Funding PLC, 7.50%, 11/20/25 (Ireland)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">75,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">565</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Trimas Corp., 9.875%, 6/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">581,950</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">9,306,858</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD align=center colspan=7>
<FONT size=2 face="serif">See Notes to Financial Statements.</FONT>
        </TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2 face="serif">19</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT size=2 face="serif">BlackRock High Yield Trust (BHY) (continued)</FONT></B>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>
      </center></TD>
        <TD width=70% align=left>

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>
      </center></TD>
        <TD width=70% align=left>

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>&nbsp;
      </center></TD>
        <TD width=70% align=right>
      <center>
        <B><FONT size=2 face="serif">Description</FONT></B>
      </center></TD>
        <TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
      </center></TD>
  </TR>
<TR>
        <TD colspan=7>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Building &amp; Development&#151;3.3%</FONT></B>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Ainsworth Lumber Co. Ltd.,</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=right>
<FONT size=1 face="serif">$</FONT>
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">40</FONT>
        </TD>
        <TD width=3% align=left><FONT size=1 face="serif">&nbsp;</FONT><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=right>
      <div align="left"><FONT size=1 face="serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.669%, 12/30/04 (Canada)</FONT>
      </div></TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">40,082</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">70</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=right>
      <div align="left"><FONT size=1 face="serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.25%, 10/01/12 (Canada)</FONT>
      </div></TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">70,525</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">955</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">D.R. Horton, Inc., 10.50%, 4/01/05</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">983,650</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">250</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Hovnanian K Enterprises, Inc., 6.375%, 12/15/14</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">253,125</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">175</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">NVR, Inc., 5.00%, 6/15/10</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">175,875</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Ba3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">125</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">WCI Communities, Inc., 7.875%, 10/01/13</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">132,813</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,656,070</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Business Equipment &amp; Services&#151;0.4%</FONT></B>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Xerox Corp.,</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">85</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=right>
      <div align="left"><FONT size=1 face="serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.875%, 8/15/11</FONT>
      </div></TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">90,525</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">100</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=right>
      <div align="left"><FONT size=1 face="serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.20%, 4/01/16</FONT>
      </div></TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">105,250</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">195,775</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Consumer Products&#151;6.5%</FONT></B>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">175</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">B&amp;G Foods, Inc., 8.00%, 10/01/11</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">184,625</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B2</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">250</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Chattem, Inc., 7.00%, 3/01/14</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">255,625</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">365</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">JC Penney Co., Inc., 7.95%, 4/01/17</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">424,313</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">250</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">K2, Inc.</FONT><FONT size=1 face="serif">, 7.375%, 7/01/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">272,388</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">315</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Lazy Days RV Center, Inc., 11.75%, 5/15/12</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">331,538</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">NR</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,200</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">4,5</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Nebco Evans Holding Co., 12.375%, 7/15/07</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">0</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">375</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Pantry, Inc., The, 7.75%, 2/15/14</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">392,812</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">130</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Petro Stopping Centers LP, 9.00%, 2/15/12</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">140,075</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">350</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Rite Aid Corp., 6.875%, 8/15/13</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">313,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">St. John Knits Intl., Inc., 12.50%, 7/01/09</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">544,375</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">275</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Stoneridge, Inc., 11.50%, 5/01/12</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">308,687</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">150</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">True Temper Sports, Inc., 8.375%, 9/15/11</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">136,500</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,304,188</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Containers &amp; Glass&#151;2.7%</FONT></B>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">60</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Ball Corp., 6.875%, 12/15/12</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">64,950</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">690</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Crown Cork &amp; Seal, Inc., 8.00%, 4/15/23</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">674,475</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">20</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Crown European Holdings SA, 10.875%, 3/01/13 (France)</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">23,800</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Graham Packaging Co., Inc.,</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">180</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=right>
      <div align="left"><FONT size=1 face="serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.50%, 10/15/12</FONT>
      </div></TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">188,550</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">110</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=right>
      <div align="left"><FONT size=1 face="serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.875%, 10/15/14</FONT>
      </div></TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">116,325</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">275</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Owens Brockway Glass Container, 8.25%, 5/15/13</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">299,750</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,367,850</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Ecological Services &amp; Equipment&#151;1.6%</FONT></B>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Allied Waste NA, Inc.,</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">80</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=right>
      <div align="left"><FONT size=1 face="serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.50%, 12/01/08</FONT>
      </div></TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">84,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">110</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=right>
      <div align="left"><FONT size=1 face="serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.875%, 4/01/08</FONT>
      </div></TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">116,600</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">564</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=right>
      <div align="left"><FONT size=1 face="serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Ser. B, 10.00%, 8/01/09</FONT>
      </div></TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">589,380</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">789,980</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Energy&#151;25.6%</FONT></B>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">AES Corp., 7.75%, 3/01/14</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,091,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">237</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">AES Red Oak LLC, Ser. A, 8.54%, 12/01/19</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">260,704</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">40</FONT>
        </TD>
        <TD width=3% align=left><FONT size=1 face="serif">&nbsp;</FONT><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Belden &amp; Blake Corp., 8.75%, 7/15/12</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">42,800</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">775</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Calpine Canada Energy Finance LLC, 8.50%, 5/01/08 (Canada)</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">476,625</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">375</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Calpine Corp., 9.625%, 9/30/14</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">358,125</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Ba1</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">244</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">CE Generation LLC, 7.416%, 12/15/18</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">256,564</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">250</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Chesapeake Energy Corp., 7.00%, 8/15/14</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">272,188</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">150</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Coastal Corp., 7.75%, 6/15/10</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">155,063</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">300</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Compton Petroleum Corp., Ser. A, 9.90%, 5/15/09 (Canada)</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">333,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">250</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Dresser, Inc., 9.375%, 4/15/11</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">278,750</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B1</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">345</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Edison Mission Energy, 10.00%, 8/15/08</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">402,788</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">190</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">El Paso Corporation, 7.875%, 6/15/12</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">198,313</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B1</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">65</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">El Paso Natural Gas Co., 7.625%, 8/01/10</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">70,444</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">700</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">El Paso Production Holding Co., 7.75%, 6/01/13</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">731,500</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD align=center colspan=7>
<FONT size=2 face="serif">See Notes to Financial Statements.</FONT>
        </TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2 face="serif">20</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT size=2 face="serif">BlackRock High Yield Trust (BHY) (continued)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan=3 align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
        </TD>
        <TD colspan=3 align=left>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>&nbsp;
      </center></TD>
        <TD width=70% align=center>
<B><FONT size=2 face="serif">Description</FONT></B>&nbsp;
        </TD>
        <TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
      </center></TD>
  </TR>
<TR>
        <TD colspan=7>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Energy&#151;(cont&#146;d)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Ba2</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>
      <div align="right"><FONT size=1 face="serif">$</FONT>&nbsp;
      </div></TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">736</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Elwood Energy LLC, 8.159%, 7/05/26</FONT>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">780,253</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">250</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Exco Resources, Inc., 7.25%, 1/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">270,625</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">160</FONT>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Frontier Oil Corp., 6.625%, 10/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">163,200</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Hanover Compressor Co., 8.625%, 12/15/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">550,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">140</FONT></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Hilcorp Energy I LP, 10.50%, 9/01/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">157,850</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">180</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">KCS Energy, Inc., 7.125%, 4/01/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">186,300</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">375</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Massey Energy Co., 6.625%, 11/15/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">395,625</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Midwest Generation LLC,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B1</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">45</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">8.56%, 1/02/16</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">49,950</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B1</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">325</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">8.75%, 5/01/34</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">369,687</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">200</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Mission Energy Holdings Co., 13.50%, 7/15/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">253,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">400</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">North America Energy Partners, Inc., 8.75%, 12/01/11 (Canada)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">387,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">475</FONT></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">NRG Energy, Inc., 8.00%, 12/15/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">524,875</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B2</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Orion Power Holdings, Inc., 12.00%, 5/01/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">631,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Ba2</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">125</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Plains Exploration &amp; Production Co., 7.125%, 6/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">138,750</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">325</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Premcor Refining Group, Inc., 6.75%, 5/01/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">341,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Ba2</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">250</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Pride Intl., Inc., 7.375%, 7/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">281,562</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">185</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Range Resources Corp., 7.375%, 7/15/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">196,562</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">345</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Reliant Energy, Inc., 9.25%, 7/15/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">381,225</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">400</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Roseton Danskammer, Ser.A, 7.27%, 11/08/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">404,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">300</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Swift Energy Co., 7.625%, 7/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">324,750</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B1</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">160</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Tennessee Gas Pipeline Co., 8.375%, 6/15/32</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">174,800</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">400</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Transcontinental Gas Pipe Line Corp., Ser. B, 8.875%, 7/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">493,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B2</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">155</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Whiting Petroleum Corp., 7.25%, 5/01/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">161,587</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">425</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Williams Cos, Inc., 7.625%, 7/15/19</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">479,187</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">13,024,902</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Entertainment &amp; Leisure&#151;4.2%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">350</FONT></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">American Casino &amp; Entertainment Properties LLC, 7.85%, 2/01/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">373,625</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">100</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Hammons John Q. Hotels LP, Ser. B, 8.875%, 5/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">115,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Ba3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">116</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Host Marriot Corp., Ser. B, 7.875%, 8/01/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">119,190</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">175</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">ITT Corp., 7.375%, 11/15/15</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">197,313</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">MGM Mirage,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">475</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.875%, 2/27/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">467,875</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">245</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.00%, 10/01/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">252,656</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">110</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.75%, 9/01/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">116,325</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Ba3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">120</FONT></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Mohegan Tribal Gaming Auth., 7.125%, 8/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">128,100</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B2</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">375</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Worldspan LP, 9.625%, 6/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">356,250</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,126,334</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Financial Institutions&#151;20.2%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">NR</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">500</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2,5</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Ameriserve Finance Capital Corp., 12.00%, 9/15/06</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">25,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">755</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Athena Neurosciences Finance LLC, 7.25%, 2/21/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">784,256</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Ba2</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Capital Guardian High Yield CBO Ltd., Ser. 1A, 11.45%, 5/24/13 (Cayman Island)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">983,100</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">200</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Crum &amp; Forster Holdings Corp., 10.375%, 6/15/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">214,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Dow Jones CDX NA HY,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1, 7.75%, 12/29/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,028,750</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">500</FONT></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2, 6.375%, 12/29/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">516,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,500</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 3, 8.00%, 12/29/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,530,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">60</FONT></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">E*Trade Financial Corp., 8.00%, 6/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">63,300</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Fairfax Financial Holdings, Ltd.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">50</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.875%, 4/15/08 (Canada)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">49,875</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">355</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.75%, 4/26/12 (Canada)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">335,475</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Ba3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,500</FONT></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">First Dominion Funding II, Ser. 1A, 11.61%, 4/25/14 (Cayman Island)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,235,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">135</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Global Cash Access, Inc., 8.75%, 3/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">146,475</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">185</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Kraton Polymers LLC, 8.125%, 1/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">185,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">190</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">New ASAT Finance Ltd., 9.25%, 2/01/11 (Cayman Island)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">166,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Rainbow National Services LLC,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">285</FONT></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">8.75%, 9/01/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">304,950</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">300</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">10.375%, 9/01/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">325,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">300</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Refco Finance Holdings LLC, 9.00%, 8/01/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">323,694</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD align=center colspan=7>
<FONT size=2 face="serif">See Notes to Financial Statements.</FONT>
        </TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2 face="serif">21</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT size=2 face="serif">BlackRock High Yield Trust (BHY) (continued)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan=3 align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
        </TD>
        <TD colspan=3 align=left>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>&nbsp;
      </center></TD>
        <TD width=70% align=center>
<B><FONT size=2 face="serif">Description</FONT></B>&nbsp;
        </TD>
        <TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
      </center></TD>
  </TR>
<TR>
        <TD colspan=7>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Financial Institutions&#151;(cont&#146;d)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>
      <div align="right"><FONT size=1 face="serif">$</FONT>&nbsp;
      </div></TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">320</FONT><SUP></SUP>
        </TD>
        <TD width=35 align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Riddell Bell Holdings, Inc., 8.375%, 10/01/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">330,400</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">275</FONT><SUP></SUP>
        </TD>
        <TD width=35 align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Standard Aero Holdings, Inc., 8.25%, 9/01/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">290,125</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">185</FONT></TD>
        <TD width=35 align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Vanguard Health Holding Co. II LLC, 9.00%, 10/01/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">191,475</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">C</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,429</FONT><SUP></SUP>
        </TD>
        <TD width=35 align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Zais Investment Grade Ltd., Class C, Pay-in-Kind, 9.95%, 9/23/14 (Cayman Island)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">242,870</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">10,271,995</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Health Care&#151;5.2%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">NR</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">500</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">HealthSouth Corp., 7.625%, 6/01/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">485,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">225</FONT><SUP></SUP>
        </TD>
        <TD width=35 align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">IASIS Healthcare Corp., 8.75%, 6/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">241,875</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">50</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Insight Health Services Corp., Ser. B, 9.875%, 11/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">50,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">135</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Norcross Safety Products LLC, 9.875%, 8/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">147,150</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">600</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Province Healthcare Co., 7.50%, 6/01/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">678,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Tenet Healthcare Corp.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">205</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.375%, 12/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">187,063</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.50%, 6/01/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,537</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">120</FONT></TD>
        <TD width=35 align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">9.875%, 7/01/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">125,700</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">180</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Triad Hospitals, Inc., 7.00%, 11/15/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">184,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">275</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Universal Hospital Services, Inc., 10.125%, 11/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">280,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;


        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">US Oncology, Inc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B2</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">140</FONT></TD>
        <TD width=35 align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">9.00%, 8/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">148,050</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">125</FONT><SUP></SUP>
        </TD>
        <TD width=35 align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">10.75%, 8/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">133,437</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,665,812</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Industrials&#151;5.4%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">265</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Cenveo Corp., 7.875%, 12/01/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">256,387</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">225</FONT><SUP></SUP>
        </TD>
        <TD width=35 align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Concentra Operating Corp., 9.125%, 6/01/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">249,187</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">140</FONT><SUP></SUP>
        </TD>
        <TD width=35 align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Dresser Rand Group, Inc., 7.375%, 11/01/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">146,300</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">570</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">ERICO Intl. Corp., 8.875%, 3/01/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">595,650</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">250</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">JLG Industries, Inc., 8.375%, 6/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">263,750</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">United Rentals NA, Inc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">750</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.00%, 2/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">691,875</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">80</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.75%, 11/15/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">77,600</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">500</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Williams Scotsman, Inc., 9.875%, 6/01/07</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">480,000</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,760,749</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Media&#151;12.0%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">150</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Affinity Group, Inc., 9.00%, 2/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">160,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B1</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">750</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Alliance Atlantis Communications, Inc., 13.00%, 12/15/09 (Canada)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">806,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">550</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Charter Communications Holdings II, LLC, 10.25%, 9/15/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">572,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Charter Communications Holdings LLC,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">400</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">10.75%, 10/01/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">338,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">200</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">11.125%, 1/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">168,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">CSC Holdings, Inc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">525</FONT><SUP></SUP>
        </TD>
        <TD width=35 align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.75%, 4/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">543,375</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">90</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.875%, 2/15/18</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">96,525</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">45</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. B, 7.625%, 4/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">48,937</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Echostar DBS Corp.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">150</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.375%, 10/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">155,062</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">175</FONT><SUP></SUP>
        </TD>
        <TD width=35 align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.625%, 10/01/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">178,937</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B2</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">90</FONT></TD>
        <TD width=35 align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Fisher Communications, Inc., 8.625%, 9/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">94,950</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">250</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Granite Broadcasting Corp., 9.75%, 12/01/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">230,625</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">425</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Nexstar Finance, Inc., 7.00%, 1/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">416,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">180</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Pinnacle Entertainment, Inc., 8.75%, 10/01/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">189,450</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">300</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Primedia, Inc., 7.625%, 4/01/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">302,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Vertis, Inc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">150</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">10.875%, 6/15/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">163,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">295</FONT></TD>
        <TD width=35 align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">13.50%, 12/07/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">307,905</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">250</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">WRC Media, Inc., 12.75%, 11/15/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">235,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">980</FONT>
        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">XM Satellite Radio, Inc., 14.00%, 3/15/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,082,900</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=35 align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">6,090,666</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
</TABLE>
<center>
  <BR>
  <FONT size=2 face="serif">See Notes to Financial Statements.</FONT><BR>
</center>
<P align="center">
<FONT size=2 face="serif">22</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT size=2 face="serif">BlackRock High Yield Trust (BHY) (continued)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan=3 align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
        </TD>
        <TD colspan=3 align=left>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>&nbsp;
      </center></TD>
        <TD width=70% align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><FONT size=2
face="serif">Description</FONT></B>&nbsp;
        </TD>
        <TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
      </center></TD>
  </TR>
<TR>
        <TD colspan=7>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Real Estate&#151;0.6%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>
      <div align="right"><FONT size=1 face="serif">$</FONT>&nbsp;
      </div></TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">300</FONT>
    </div></TD>
        <TD width=3% align=left><FONT size=1 face="serif">&nbsp;</FONT><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">American Real Estate Partners LP, 8.125%, 6/01/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">316,500</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

          <div align="right"></div></TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Technology&#151;2.9%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Ba3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">500</FONT>
    </div></TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Celestica, Inc., 7.875%, 7/01/11 (Canada)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">532,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">100</FONT><SUP></SUP>
    </div></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Coleman Cable, Inc., 9.875%, 10/01/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">103,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

          <div align="right"></div></TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Freescale Semiconductor, Inc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">100</FONT><SUP></SUP>
    </div></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.82%, 1/18/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">103,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">50</FONT><SUP></SUP>
    </div></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.875%, 7/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">53,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">275</FONT>
    </div></TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">General Cable Corp., 9.50%, 11/15/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">309,375</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">201</FONT>
    </div></TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">ON Semiconductor Corp., 12.00%, 3/15/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">235,672</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">135</FONT>
    </div></TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Viasystems, Inc., 10.50%, 1/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">132,975</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

          <div align="right"></div></TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,470,022</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

          <div align="right"></div></TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Telecommunications&#151;14.9%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">575</FONT>
    </div></TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Alamosa Delaware, Inc., 8.50%, 1/31/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">608,063</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">NR</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">2,000</FONT>
    </div></TD>
        <TD width=3% align=left><FONT size=1 face="serif">&nbsp;</FONT><SUP><FONT size=1 face="serif">4,5</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Asia Global Crossing Ltd., 13.375%, 10/15/10 (Bermuda)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">160,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

          <div align="right"></div></TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">AT&amp;T Corp.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">685</FONT>
    </div></TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">8.05%, 11/15/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">784,969</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">70</FONT>
    </div></TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">8.75%, 11/15/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">81,083</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">320</FONT><SUP></SUP>
    </div></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Centennial Communications Corp., 8.625%, 2/01/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">320,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">500</FONT>
    </div></TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Cincinnati Bell, Inc., 8.375%, 1/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">477,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

          <div align="right"></div></TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Dobson Cellular Systems, Inc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B2</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">210</FONT><SUP></SUP>
    </div></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">8.375%, 11/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">216,563</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">275</FONT><SUP></SUP>
    </div></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">9.875%, 11/01/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">274,313</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

          <div align="right"></div></TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Lucent Technologies, Inc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">20</FONT>
    </div></TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.50%, 11/15/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">20,550</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">80</FONT>
    </div></TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.45%, 3/15/29</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">68,400</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">120</FONT>
    </div></TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.50%, 1/15/28</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">102,600</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">200</FONT>
    </div></TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">MCI, Inc., 5.908%, 5/01/07</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">200,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">180</FONT></div></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">New Skies Satellites NV, 9.125%, 11/01/12 (Netherlands)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">184,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">550</FONT>
    </div></TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Nextel Communications, Inc., 5.95%, 3/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">561,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">180</FONT>
    </div></TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Nortel Networks Corp., 6.875%, 9/01/23 (Canada)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">166,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

          <div align="right"></div></TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">PanAmSat Corp.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">210</FONT>
    </div></TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.875%, 1/15/28</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">181,650</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">215</FONT><SUP></SUP>
    </div></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">9.00%, 8/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">226,825</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">NR</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">600</FONT></div></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2,4,5</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">PF. Net Communications, Inc., 13.75%, 5/15/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">60</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">205</FONT></div></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Qwest Communications Intl., 7.50%, 2/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">196,800</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

          <div align="right"></div></TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Qwest Corp.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">600</FONT></div></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.875%, 9/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">637,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">425</FONT></div></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">9.125%, 3/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">479,187</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">300</FONT>
    </div></TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Rural Cellular Corp., 9.875%, 2/01/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">303,750</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">745</FONT></div></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">UbiquiTel Operating Co., 9.875%, 3/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">806,462</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <div align="right"><FONT size=1 face="serif">510</FONT>
    </div></TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Western Wireless Corp., 9.25%, 7/15/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">543,150</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

          <div align="right"></div></TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">7,601,675</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

          <div align="right"></div></TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Transportation&#151;4.9%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <FONT size=1 face="serif">500</FONT><SUP></SUP>    </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Horizon Lines LLC, 9.00%, 11/01/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">541,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <FONT size=1 face="serif">350</FONT>    </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">OMI Corp., 7.625%, 12/01/13 (Marshall Islands)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">369,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <FONT size=1 face="serif">505</FONT>    </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Overseas Shipholding Group, Inc., 7.50%, 2/15/24</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">507,525</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <FONT size=1 face="serif">500</FONT>    </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Sea Containers Ltd., Ser. B, 10.75%, 10/15/06 (Bermuda)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">518,750</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
      <FONT size=1 face="serif">500</FONT>    </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">TFM SA de CV, 12.50%, 6/15/12 (Mexico)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">565,000</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

          <div align="right"></div></TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,501,775</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

          <div align="right"></div></TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Corporate Bonds</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">68,077,239</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
</TABLE>
<center>
  <BR>
  <FONT size=2 face="serif">See Notes to Financial Statements.</FONT><BR>
</center>
<P align="center">
<FONT size=2 face="serif">23</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT size=2 face="serif">BlackRock High Yield Trust (BHY) (continued)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=8>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>&nbsp;
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left> <center>
          <B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
    </center></TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>&nbsp;
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=right>
      <center>
        <B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
      </center></TD>
        <TD colspan=3 align=right><center>
    <B><FONT size=2 face="serif"> (000)</FONT></B>        </center></TD>
        <TD width=70% align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><FONT size=2
face="serif">Description</FONT></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>

          <center>
      <B><FONT size=2 face="serif">Value</FONT></B>         </center></TD>
  </TR>
<TR>
        <TD colspan=8>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Bank Loans&#151;0.4%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=right>
<FONT size=1 face="serif">$</FONT>
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">217</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Rockwood Specialties Group, Inc., Term Loan, LIBOR + 8.00%, 11/29/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD align=right>
<FONT size=1 face="serif">216,957</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD width="10%">
        </TD>
        <TD colspan=2>&nbsp;
        </TD>
        <TD width="3%">
        </TD>
        <TD width="70%">
        </TD>
        <TD colspan=3>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR>
        <TD width="10%">&nbsp;

        </TD>
    <TD colspan=3><hr width="50" size=1 noshade></TD>
    <TD width="70%">&nbsp;</TD>
    <TD width="1%"><div align="left"></div></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Shares</FONT></B>&nbsp;
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD width="10%">
        </TD>
        <TD colspan=3>
      <hr width="50" size=1 noshade>
        </TD>
        <TD colspan=4>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Preferred Stock&#151;0.0%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Media&#151;0.0%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,098</FONT>
        </TD>
        <TD width=3%><SUP><FONT size=1 face="serif">4,5</FONT></SUP>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Adelphia Business Solutions, Ser. B, 12.875%</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">0</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR>
        <TD colspan=8>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Common Stock&#151;0.2%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">8</FONT><SUP></SUP>
        </TD>
        <TD width=3%><SUP><FONT size=1 face="serif">2,4</FONT></SUP>
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Mattress Discounters Corp.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">0</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">54</FONT><SUP></SUP>
        </TD>
        <TD width=3%><SUP><FONT size=1 face="serif">3</FONT></SUP>
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Neon Communications, Inc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">120,650</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Common Stock</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">120,650</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD width="10%">
        </TD>
        <TD colspan=2>&nbsp;
        </TD>
        <TD width="3%">
        </TD>
        <TD width="70%">
        </TD>
        <TD colspan=3>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR>
        <TD>&nbsp;

        </TD>
    <TD colspan=3><hr width="50" size=1 noshade></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Units</FONT></B>&nbsp;
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD width="10%">
        </TD>
        <TD colspan=3>
      <hr width="50" size=1 noshade>
        </TD>
        <TD colspan=4>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Warrants&#151;0.0%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1</FONT><SUP></SUP>
        </TD>
        <TD width=3%><SUP><FONT size=1 face="serif">2,3</FONT></SUP>
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Mattress Discounters Corp., Expires 7/15/07, Strike price $0.01, 4.85 shares for 1 warrant</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">1</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">54</FONT>
        </TD>
        <TD width=3%><SUP><FONT size=1 face="serif">3</FONT></SUP>
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Neon Communications, Inc., Expires 12/02/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">1</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1</FONT><SUP></SUP>
        </TD>
        <TD width=3%><SUP><FONT size=1 face="serif">3</FONT></SUP>
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">PF. Net Communications, Inc., Expires 5/15/10, Strike price $0.01, 36.87243 shares for 1 warrant</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">0</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Warrants</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">2</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<B><FONT size=1 face="serif">Total Long-Term Investments </FONT></B><FONT size=1 face="serif">(cost $75,643,790)</FONT>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD align=right>
<FONT size=1 face="serif">68,414,848</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Liabilities in excess of other assets&#151;(34.4)%</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
      <FONT size=1 face="serif">(17,500,808</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR>
  <TD colspan=5></TD>
  <TD colspan=3><HR align="left" size=1 noshade>
  </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<B><FONT size=1 face="serif">Net Assets&#151;100%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD align=right>
<FONT size=1 face="serif">50,914,040</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR align="left" size=3 noshade>
        </TD>
</TR>
</TABLE>
<BR>
<TABLE border=0 cellspacing=0 cellpadding=0>
<TR valign="top">
  <TD colspan="2" nowrap><HR align="left" width="100" size=1 noshade></TD>
  </TR>
<TR valign="top">
        <TD nowrap>
<SUP><FONT size=1 face="serif">1</FONT></SUP>&nbsp; &nbsp; &nbsp;       </TD>
        <TD>
<FONT size=1 face="serif">Using the higher of S&amp;P&#146;s, Moody&#146;s or Fitch&#146;s rating.</FONT>       </TD>
</TR>
<TR valign="top">
        <TD nowrap>
<SUP><FONT size=1 face="serif">2</FONT></SUP>   </TD>
        <TD>
<FONT size=1 face="serif">Security is not registered under the Securities Act of 1933. These securities may be resold in transactions in accordance with Rule 144A under that Act, to qualified institutional buyers. As of October 31, 2004, the Trust
held 42.1% of its net assets, with a current market value of $21,441,592, in securities restricted as to resale.</FONT></TD>
</TR>
<TR valign="top">
        <TD nowrap>
<SUP><FONT size=1 face="serif">3</FONT></SUP>&nbsp; &nbsp; &nbsp;       </TD>
        <TD>
<FONT size=1 face="serif">Illiquid securities representing 0.3% of net assets.</FONT>   </TD>
</TR>
<TR valign="top">
        <TD nowrap>
<SUP><FONT size=1 face="serif">4</FONT></SUP>&nbsp; &nbsp; &nbsp;       </TD>
        <TD>
<FONT size=1 face="serif">Security is fair valued.</FONT>       </TD>
</TR>
<TR valign="top">
        <TD nowrap>
<SUP><FONT size=1 face="serif">5</FONT></SUP>&nbsp; &nbsp; &nbsp;       </TD>
        <TD>
<FONT size=1 face="serif">Issuer is technically in default and/or bankruptcy.</FONT>    </TD>
</TR>
<TR><TD colspan=2>&nbsp;</TD></TR></TABLE>
<P>
<FONT size=1 face="serif">A category in the Corporate Bonds section may contain multiple industries as defined by the SEC&#146;s Standard Industry Codes.</FONT></P>
<center>
  <FONT size=2 face="serif">See Notes to Financial Statements.</FONT><BR>
</center>
<P align="center">
<FONT size=2 face="serif">24</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT face="serif">PORTFOLIO OF INVESTMENTS</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT face="serif">OCTOBER 31, 2004</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD colspan=5 align=left>
 &nbsp;<B><FONT size=2 face="serif">BlackRock Income Opportunity Trust (BNA)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>&nbsp;
      </center></TD>
        <TD width=70% align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><FONT size=2
face="serif">Description</FONT></B>&nbsp;
        </TD>
        <TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
      </center></TD>
  </TR>
<TR>
        <TD colspan=7>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">LONG-TERM INVESTMENTS&#151;133.9%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Mortgage Pass-Through Securities&#151;18.5%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal National Mortgage Assoc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=right>
<FONT size=1 face="serif">$</FONT>
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">61,515 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.50%, 12/01/13 - 9/01/17</FONT>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">63,571,282</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">14,347</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.00%, 3/01/27 - 11/01/34</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">15,024,680</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">361</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.00%, 2/01/24 - 1/01/29</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">384,473</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Government National Assoc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">145</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">8.00%, 4/15/24 - 11/15/25</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">158,770</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Mortgage Pass-Through Securities</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">79,139,205</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Federal Housing Administration&#151;1.3%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">GMAC Projects,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">589</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 37, 7.43%, 5/01/22</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">626,333</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">207</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 44, 7.43%, 8/01/22</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">220,335</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Merrill Projects,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">195</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 29, 7.43%, 10/01/20</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">207,615</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">238</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 42, 7.43%, 9/01/22</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">252,836</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,927</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Reilly Project, Ser. B-11, 7.40%, 4/01/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,046,694</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,950</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Westmore Project, 7.25%, 4/01/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,059,776</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Federal Housing Administration</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5,413,589</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Agency Multiple Class Mortgage Pass-Through Securities&#151;1.4%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,750</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal Home Loan Mortgage Corp., Ser. 82, Class HJ, 9/25/32</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,898,828</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,958</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Government National Assoc., 6.00%, 6/20/15</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,068,291</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Agency Multiple Class Mortgage Pass-Through Securities</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5,967,119</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Non-Agency Multiple Class Mortgage Pass-Through Securities&#151;2.4%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">9,144</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Residential Funding Securities Corp., Ser. RM2, Class AI5, 5/25/33</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">10,173,199</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">39 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Summit Mortgage Trust, Ser. 1, Class B1, 6.079%, 12/28/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">38,571</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Non-Agency Multiple Class Mortgage Pass-Through Securities</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">10,211,770</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Adjustable Rate Mortgage Securities&#151;0.0%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">19</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal National Mortgage Assoc., Ser. 256, Class F, 3.344%, 11/25/23</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">16,744</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Inverse Floating Rate Mortgage Securities&#151;0.7%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal Home Loan Mortgage Corp., Ser. 1611, Class JC, 10.00%, 8/15/23</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,082,140</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal National Mortgage Assoc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">36</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 7, Class S, 3/25/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5,294</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,808</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 23, Class PS, 10.303%, 4/25/23</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,938,604</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">17</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 46, Class S, 20.968%, 5/25/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,819</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">21</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 49, Class S, 8.431%, 12/25/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,110</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">108</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 87, Class S, 21.797%, 8/25/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">128,412</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">22</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 145, Class S, 29.597%, 10/25/06</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">24,565</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Inverse Floating Rate Mortgage Securities</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,185,944</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Interest Only Asset-Backed Securities&#151;1.5%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Sterling Coofs Trust,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">42,564</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1, 4/15/29</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,780,245</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">32,945</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2, 3/30/30</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,625,305</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Interest Only Asset-Backed Securities</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">6,405,550</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Interest Only Mortgage-Backed Securities&#151;2.2%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal Home Loan Mortgage Corp.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 176, Class M, 7/15/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">70</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 192, Class U, 2/15/22</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">77</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">16</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1043, Class H, 2/15/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">22,546</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1054, Class I, 3/15/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">403</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">16</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1056, Class KD, 3/15/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,028</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">19</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1057, Class J, 3/15/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,093</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">54</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1148, Class E, 10/15/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,106</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">14</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1179, Class O, 11/15/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">243</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">13</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1221 Class H, 3/15/07</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">233</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">373</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1254, Class Z, 4/15/22</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">16,069</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD align=center colspan=7>
<FONT size=2 face="serif">See Notes to Financial Statements.</FONT>
        </TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2 face="serif">25</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT size=2 face="serif">BlackRock Income Opportunity Trust (BNA) (continued)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>&nbsp;
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left> <center>
          <B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
    </center></TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>&nbsp;
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=right>
      <center>
        <B><FONT size=2 face="serif">(unaudited) </FONT></B>&nbsp;
      </center></TD>
        <TD colspan=3 align=right><center>
    <B><FONT size=2 face="serif">(000)</FONT></B>         </center></TD>
        <TD width=70% align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><FONT size=2
face="serif">Description</FONT></B>&nbsp;
        </TD>
        <TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
      </center></TD>
  </TR>
<TR>
        <TD colspan=7>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=center>
      <div align="left"><B><FONT size=2 face="serif">Interest Only Mortgage-Backed Securities&#151;(cont&#146;d)</FONT></B>&nbsp;
      </div></TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal Home Loan Mortgage Corp. (cont&#146;d)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=right>
<FONT size=1 face="serif">$</FONT>
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">765</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1831, Class PG, 3/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">82,934</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">9,079</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2611, Class QI, 9/15/32</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,717,898</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal National Mortgage Assoc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">103</FONT></TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 10, Class S, 5/25/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">12,507</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">82</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 12, Class S, 5/25/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">15,930</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">53</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 17, Class S, 6/25/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">7,755</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">168</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 5, Class H, 1/25/22</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">24,241</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">12</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 7, Class 2, 4/1/17</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,189</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 20, Class H, 3/25/06</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">23</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">72</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 33, Class PV, 10/25/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">16,416</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">7</FONT></TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 38, Class N, 4/25/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">735</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">821</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 46, Class H, 12/25/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">144,338</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">749</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 50, Class SI, 4/25/23</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">17,314</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 54, Class H, 5/25/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">39</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">15,480</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 64, Class QI, 1/25/33</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,990,683</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">6</FONT></TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 84, Class H, 8/25/06</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">377</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">21</FONT></TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 89, Class 2, 6/1/18</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,479</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">37,000</FONT></TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 90, Class JH, 12/31/49</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,948,594</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">6</FONT></TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 94, Class 2, 8/1/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,228</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">26</FONT></TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 99, Class L, 8/25/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,675</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 123, Class M, 10/25/20</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">708</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">37</FONT></TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 136, Class S, 11/25/20</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">39,635</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">42</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 139, Class PT, 10/25/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,338</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">21</FONT></TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 141, Class SA, 8/25/07</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,154</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">9,696</FONT>
        </TD>
        <TD width=3%><SUP><FONT size=1 face="serif">3</FONT></SUP>
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Goldman Sachs Mortgage Securities Corp., Ser. 5, 2/19/25</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">204,913</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,907</FONT>
        </TD>
        <TD width=3%><SUP><FONT size=1 face="serif">3</FONT></SUP>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Hanover Grantor Trust, Ser. A, Class 1, 8/1/27</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">23,553</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,617</FONT><SUP></SUP>
        </TD>
        <TD width=3%><SUP><FONT size=1 face="serif">3</FONT></SUP>
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Morgan Stanley Capital I, Inc., Ser. HF1, Class X, 6/15/17</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">67,719</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Morgan Stanley Mortgage Trust,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">56</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 38, Class 2, 11/20/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">10,121</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">60</FONT></TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 39, Class 2, 12/20/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">10,732</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">104</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Residential Asset Securization Trust, Ser. A3, Class X, 5/25/29</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,598</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">6,645</FONT></TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=center>
      <div align="left"><FONT size=1 face="serif">Salomon Brothers Mortgage Securities VII, Inc., Ser. 1, Class IO, 3/25/22</FONT>&nbsp;
      </div></TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">48,376</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Interest Only Mortgage-Backed Securities</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">9,453,070</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Principal Only Mortgage-Backed Securities&#151;0.5%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">220</FONT></TD>
        <TD width=3%><SUP><FONT size=1 face="serif">2</FONT></SUP>
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal Home Loan Mortgage Corp., Ser. 1739, Class B, 2/15/24</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">193,228</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal National Mortgage Assoc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">72</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 51, Class E, 2/25/23</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">58,570</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">25</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 70, Class A, 5/25/23</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">22,587</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">33</FONT></TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 167, Class D, 10/25/17</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">31,830</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">44</FONT></TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 203, Class 1, 2/1/23</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">39,767</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">32</FONT></TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 228, Class 1, 5/1/23</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">28,033</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">6,055</FONT></TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Resolution Funding Corp., Ser. B, 4/15/30</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,585,804</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Principal Only Mortgage-Backed Securities</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,959,819</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">U.S. Government and Agency Securities&#151;43.4%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">18,826</FONT></TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Overseas Private Investment Corp., zero coupon-7.35%, 5/29/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">19,595,874</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,754</FONT></TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Small Business Administration, Ser. 20K-1, 6.95%, 11/01/16</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,882,643</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">U.S. Treasury Bonds,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">24,205</FONT></TD>
        <TD width=3%><SUP><FONT size=1 face="serif">2</FONT></SUP>
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.375%, 2/15/31</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">26,300,185</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">6,350</FONT></TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.50%, 8/15/28</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">6,920,484</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">32,000</FONT>
        </TD>
        <TD width=3%><SUP><FONT size=1 face="serif">2</FONT></SUP>
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.00%, 2/15/26</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">36,933,760</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">450</FONT></TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.125%, 11/15/27</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">529,143</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">U.S. Treasury Notes,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,985</FONT></TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">2.00%, 7/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,054,364</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">8,020</FONT>
        </TD>
        <TD width=3%><SUP><FONT size=1 face="serif">2</FONT></SUP>
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">2.50%, 5/31/06 - 9/30/06</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">8,014,078</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">63,595</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.25%, 8/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">64,697,738</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">15,180 </FONT><SUP></SUP>
        </TD>
        <TD width=3%><SUP><FONT size=1 face="serif">2</FONT></SUP>
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.75%, 5/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">16,052,850</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,200</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.875%, 2/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,358,818</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total U.S. Government and Agency Securities</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">185,339,937</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD align=center colspan=7>
<FONT size=2 face="serif">See Notes to Financial Statements.</FONT>
        </TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2 face="serif">26</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT size=2 face="serif">BlackRock Income Opportunity Trust (BNA) (continued)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan=3 align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
        </TD>
        <TD colspan=3 align=left>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>&nbsp;
      </center></TD>
        <TD width=70% align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><FONT size=2
face="serif">Description</FONT></B>&nbsp;
        </TD>
        <TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
      </center></TD>
  </TR>
<TR>
        <TD colspan=7>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Collateralized Mortgage Obligation Residuals&#151;0.0%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Collateralized Mortgage Obligation Trust,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>
      <div align="right"><FONT size=1 face="serif">$</FONT></div></TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 40, Class R, 4/01/18</FONT>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">309</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">57</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 42, Class R, 10/01/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">7,755</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal Home Loan Mortgage Corp.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">20</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 19, Class R, 3/15/20</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,316</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">0</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 75, Class R, 1/15/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">0</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 75, Class RS, 1/15/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">0</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 173, Class R, 11/15/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">22</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">0</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 173, Class RS, 11/15/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">22</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">28</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 200, Class R, 12/15/22</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">511</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Collateralized Mortgage Obligation Residuals</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">10,945</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Corporate Bonds&#151;61.2%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Aero &amp; Defense&#151;2.2%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,235</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">BE Aerospace, Inc., 9.50%, 11/01/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,273,594</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">L-3 Communications Corp., 7.625%, 6/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,657,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,250</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Lockheed Martin Corp., 8.50%, 12/01/29</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,672,200</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Northrop Grumman Corp., 7.125%, 2/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,153,090</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Raytheon Co.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,200</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.15%, 11/01/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,303,068</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">NR</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.00%, 5/15/06</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,111,928</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">9,171,380</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Automotive&#151;2.0%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Briggs &amp; Stratton Corp., 8.875%, 3/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,375,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B1</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,340</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Dura Operating Corp., Ser. B, 8.625%, 4/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,316,600</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,000 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Ford Motor Credit Co., 6.875%, 2/01/06</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,123,720</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">General Motors Corp., 8.375%, 7/15/33</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">545,152</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">8,360,472</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Basic Materials&#151;3.4%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Alcoa, Inc., 7.375%, 8/01/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,336,400</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Caraustar Industries, Inc., 9.875%, 4/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,175,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Lyondell Chemical Co., 11.125%, 7/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,536,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Oregon Steel Mills, Inc., 10.00%, 7/15/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,105,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Tembec Industries, Inc., 8.50%, 2/01/11 (Canada)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,556,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Weyerhaeuser Co.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,550</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.95%, 11/01/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,686,121</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.75%, 3/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,128,910</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">14,523,931</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Building &amp; Development&#151;0.6%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">D.R. Horton, Inc., 10.50%, 4/01/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,575,000</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Conglomerates&#151;0.9%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,650</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">General Electric Co., 5.00%, 2/01/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,776,546</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Consumer Products&#151;5.7%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,475</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">American Seafoods Group LLC, 10.125%, 4/15/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,578,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Autonation, Inc., 9.00%, 8/01/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,728,750</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Buffets, Inc., 11.25%, 7/15/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,120,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">General Mills, Inc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">550</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.125%, 2/15/07</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">573,320</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,700</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.00%, 2/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,847,798</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Kellogg Co., Ser. B, 6.60%, 4/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,264,700</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">935</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Kraft Foods, Inc., 5.625%, 11/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">995,139</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Kroger Co., 5.50%, 2/01/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,043,580</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AA-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Procter &amp; Gamble Co., 6.875%, 9/15/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,422,310</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,495</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Safeway, Inc., 6.50%, 3/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,756,261</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Unilever Capital Corp., 7.125%, 11/01/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,324,580</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Yum! Brands, Inc., 8.875%, 4/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,744,276</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">24,398,964</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD align=center colspan=7>
<FONT size=2 face="serif">See Notes to Financial Statements.</FONT>
        </TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2 face="serif">27</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT size=2 face="serif">BlackRock Income Opportunity Trust (BNA) (continued)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan=3 align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
        </TD>
        <TD colspan=3 align=left>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>&nbsp;
      </center></TD>
        <TD width=70% align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><FONT size=2
face="serif">Description</FONT></B>&nbsp;
        </TD>
        <TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
      </center></TD>
  </TR>
<TR>
        <TD colspan=7>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Containers &amp; Glass&#151;1.3%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>
      <div align="right"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Crown European Holdings SA, 9.50%, 3/01/11 (France)</FONT>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,717,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,250</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Owens-Brockway Glass Container, Inc., 8.875%, 2/15/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,458,125</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,240</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Stone Container Corp., 9.25%, 2/01/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,391,900</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5,567,525</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Ecological Services &amp; Equipment&#151;1.0%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,695</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Allied Waste NA, Inc., Ser. B, 10.00%, 8/01/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,771,275</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,250</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Casella Waste Systems, Inc., 9.75%, 2/01/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,497,500</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,268,775</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Energy&#151;6.8%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Chesapeake Energy Corp., 9.00%, 8/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,878,125</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Conoco Funding Co., 6.35%, 10/15/11 (Canada)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,369,600</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Dominion Resources, Inc., 5.70%, 9/17/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,119,260</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Dresser, Inc., 9.375%, 4/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,787,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">DTE Energy Co., 7.05%, 6/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,712,760</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,500 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Dynegy Holdings, Inc., 10.125%, 7/15/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,747,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B1</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">El Paso Natural Gas Co., 7.625%, 8/01/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,083,750</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">El Paso Production Holding Co., 7.75%, 6/01/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,567,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">640</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Exelon Corp., 6.75%, 5/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">718,355</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">FirstEnergy Corp.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">480</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. B, 6.45%, 11/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">525,859</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. C, 7.375%, 11/15/31</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,709,115</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,250</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Kinder Morgan Energy Partners LP, 7.30%, 8/15/33</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,447,975</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Kinder Morgan, Inc., 6.50%, 9/01/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,108,300</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,800</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Occidental Petroleum Corp., 6.75%, 1/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,054,736</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Progress Energy, Inc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Baa2</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,800</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.75%, 3/01/06</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,888,326</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Baa2</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.10%, 3/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,267,980</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">28,986,641</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Entertainment &amp; Leisure&#151;2.7%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Boyd Gaming Corp., 8.75%, 4/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,250,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,700</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Hammons John Q. Hotels LP, Ser. B, 8.875%, 5/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,955,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Ba3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">382</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Host Marriot Corp., Ser. B, 7.875%, 8/01/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">392,505</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Ba2</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">MGM Mirage, 9.75%, 6/01/07</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,125,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Ba2</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Park Place Entertainment Corp., 8.875%, 9/15/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,302,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Starwood Hotels &amp; Resorts Worldwide, Inc., 7.875%, 5/01/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,506,250</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">11,531,255</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Financial Institutions&#151;17.0%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Aa3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,450</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Bank of America Corp., 7.80%, 2/15/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,892,494</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Aa3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,400</FONT></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Bank One Corp., 6.50%, 2/01/06</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,466,192</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Aa3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Barclays Bank PLC, 6.86%, 9/29/49 (United Kingdom)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,237,850</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Bear Stearns Co., Inc., 6.50%, 5/01/06</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">526,890</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Citigroup, Inc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AA+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">450</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">2.00%, 6/09/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">451,048</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">849 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.00%, 9/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">856,777</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">6,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.625%, 8/27/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">6,480,780</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Credit Suisse First Boston USA, Inc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AA-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">700</FONT></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.125%, 11/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">770,077</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AA-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.125%, 7/15/32</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,184,270</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Crum &amp; Forster Holdings Corp., 10.375%, 6/15/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,070,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,000</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal Home Loan Mortgage Corp., 6.875%, 9/15/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,628,320</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal National Mortgage Assoc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.375%, 9/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,032,680</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,805</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.125%, 6/15/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,105,280</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">General Electric Capital Corp., Ser. A, 6.75%, 3/15/32</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,497,760</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">General Motors Acceptance Corp.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Baa1</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">700</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.75%, 1/15/06</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">726,082</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Baa1</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.875%, 8/28/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,142,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Aa3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Goldman Sachs Group, Inc., 6.60%, 1/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,119,940</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,650</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Household Finance Corp., 6.375%, 10/15/11 - 11/27/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,073,468</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD align=center colspan=7>
<FONT size=2 face="serif">See Notes to Financial Statements.</FONT>
        </TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2 face="serif">28</FONT></P>

<HR noshade align="center" width="100%" size=4>
<PAGE>
<p></p>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT size=2 face="serif">BlackRock Income Opportunity Trust (BNA) (continued)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>&nbsp;
      </center></TD>
        <TD width=70% align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><FONT size=2
face="serif">Description</FONT></B>&nbsp;
        </TD>
        <TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
      </center></TD>
  </TR>
<TR>
        <TD colspan=7>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Financial Institutions&#151;(cont&#146;d)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">HSBC Bank USA, Inc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AA</FONT>&nbsp;
        </TD>
        <TD width=4% align=right>
<FONT size=1 face="serif">$</FONT>
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,525</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">3.875%, 9/15/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,535,125</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AA-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">850</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.875%, 11/01/34</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">849,150</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">JP Morgan Chase &amp; Co.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Aa3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,100</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.25%, 5/30/07</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,208,591</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A1</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.75%, 2/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,132,770</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">KFW Intl. Finance, Inc., 5.25%, 6/28/06</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,124,710</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Lehman Brothers Holdings, Inc., 6.625%, 1/18/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,696,095</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Marsh &amp; McLennan Cos, Inc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">275</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">2.193%, 7/13/07</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">265,966</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">285</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.375%, 7/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">277,499</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AA-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">600</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Morgan Stanley, 5.80%, 4/01/07</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">637,590</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AA-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,200</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">National City Bank Cleveland Ohio, 3.375%, 10/15/07</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,203,756</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Northern Trust Co., 6.30%, 3/07/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,240,940</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Rainbow National Services LLC,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">225 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">8.75%, 9/01/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">240,750</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">675 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">10.375%, 9/01/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">732,375</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Aa2</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,025</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">U.S. Bank NA, 2.036%, 10/01/07</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,022,429</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">UBS Preferred Funding Trust I, 8.622%, 10/29/49</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,453,878</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Aa3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,450</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Wachovia Bank NA, 4.80%, 11/01/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,442,996</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Aa1</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,780</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Wells Fargo &amp; Co., 1.98%, 9/15/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,778,715</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Aa1</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Wells Fargo Bank, 7.55%, 6/21/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,362,420</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">72,467,663</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Health Care&#151;1.6%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Bristol Myers Squibb Co., 5.75%, 10/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,078,960</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">NR</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">HealthSouth Corp., 7.00%, 6/15/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,985,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Omnicare, Inc., Ser. B, 8.125%, 3/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,627,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,310</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">UnitedHealth Group, Inc., 3.375%, 8/15/07</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,306,594</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">6,998,054</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Industrials&#151;0.7%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">825</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Allegiance Corp., 7.00%, 10/15/26</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">858,841</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,010</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Manitowoc, Inc., 10.50%, 8/01/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,319,037</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,177,878</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Media&#151;4.5%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B1</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Alliance Atlantis Communications, Inc., 13.00%, 12/15/09 (Canada)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,150,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">AOL Time Warner, Inc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,410</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.57%, 2/01/24</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,777,163</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">9.125%, 1/15/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,784,200</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,860</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">AT&amp;T Broadband Corp., 8.375%, 3/15/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,281,718</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">675</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Charter Communications Holdings II, LLC, 10.25%, 9/15/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">702,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,425</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Charter Communications Holdings LLC, 10.75%, 10/01/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,049,125</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Comcast Cable Communications, Inc., 6.75%, 1/30/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,117,070</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">325</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Comcast Corp., 7.05%, 3/15/33</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">367,243</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Quebecor Media, Inc., 11.125%, 7/15/11 (Canada)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,157,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">WRC Media, Inc., 12.75%, 11/15/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,820,000</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">19,206,019</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Other&#151;4.3%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">16,320 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Targeted Return Index Securities Trust, Inc., Ser. 10-2002, 6.896%, 1/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">18,465,264</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Real Estate&#151;1.2%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">AvalonBay Communities, Inc., 6.625%, 9/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,111,710</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">EOP Operating LP,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,285</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.65%, 10/01/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,298,916</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">800</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.00%, 7/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">905,064</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">725</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Rouse Co., 3.625%, 3/15/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">683,073</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,998,763</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Technology&#151;0.5%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Seagate Technology Holdings, 8.00%, 5/15/09 (Cayman Island)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,160,000</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD align=center colspan=7>
<FONT size=2 face="serif">See Notes to Financial Statements.</FONT>
        </TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2 face="serif">29</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT size=2 face="serif">BlackRock Income Opportunity Trust (BNA) (continued)</FONT></B>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=8>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;</TD>
        <TD colspan=3 align=left><center>
          <B><FONT size=2 face="serif">Principal/Notional</FONT></B>&nbsp;
    </center></TD>
        <TD width=62% align=left>&nbsp;</TD>
        <TD align=left>

        </TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
      <center>
        <B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
      </center></TD>
        <TD colspan=3 align=center>
      <B><FONT size=2 face="serif">Amount</FONT></B>    </TD>
        <TD width=62% align=left>&nbsp;

        </TD>
        <TD align=left>

        </TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=right>
      <center>
        <B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
      </center></TD>
        <TD colspan=3 align=right>
      <center>
        <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>&nbsp;
    </center></TD>
        <TD width=62% align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><FONT size=2
face="serif">Description</FONT></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>
      </center></TD>
  </TR>
<TR>
        <TD colspan=8>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<B><FONT size=2 face="serif">Telecommunications&#151;3.4%</FONT></B>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A</FONT>&nbsp;
        </TD>
        <TD width=6% align=right>
<FONT size=1 face="serif">$</FONT>
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,675</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<FONT size=1 face="serif">BellSouth Corp., 5.20%, 9/15/14</FONT>&nbsp;
        </TD>
        <TD align=right>
<FONT size=1 face="serif">$</FONT>
        </TD>
        <TD align=right>
<FONT size=1 face="serif">3,745,450</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">250 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=62% align=left>
<FONT size=1 face="serif">Qwest Corp., 7.875%, 9/01/11</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">265,625</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<FONT size=1 face="serif">SBC Communications, Inc.,</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A</FONT>&nbsp;
        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">350</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.125%, 9/15/09</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">349,923</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A</FONT>&nbsp;
        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,125</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.10%, 9/15/14</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">3,141,999</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A+</FONT>&nbsp;
        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.25%, 3/15/11</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">1,102,790</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A+</FONT>&nbsp;
        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">575</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<FONT size=1 face="serif">Verizon Global Funding Corp., 7.75%, 6/15/32</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">704,289</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Aa3</FONT>&nbsp;
        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">540</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<FONT size=1 face="serif">Verizon Maryland, Inc., 5.125%, 6/15/33</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">474,925</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Aa3</FONT>&nbsp;
        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<FONT size=1 face="serif">Verizon Pennsylvania, Inc., Ser. A, 5.65%, 11/15/11</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">3,194,580</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A</FONT>&nbsp;
        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<FONT size=1 face="serif">Vodafone Group PLC, 7.75%, 2/15/10 (United Kingdom)</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">1,177,200</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>&nbsp;

        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">14,156,781</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<B><FONT size=2 face="serif">Transportation&#151;1.4%</FONT></B>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<FONT size=1 face="serif">Burlington Northern Santa Fe Corp., 5.90%, 7/01/12</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">1,078,510</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<FONT size=1 face="serif">Canadian National Railway Co., 6.375%, 10/15/11 (Canada)</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">1,118,527</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,475</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<FONT size=1 face="serif">Canadian Pacific Railway Ltd., 6.25%, 10/15/11 (Canada)</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">1,634,270</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<FONT size=1 face="serif">Union Pacific Corp., 6.125%, 1/15/12</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">2,177,160</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>&nbsp;

        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">6,008,467</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<FONT size=1 face="serif">Total Corporate Bonds</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">260,799,378</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<B><FONT size=2 face="serif">Foreign Government Bonds&#151;0.8%</FONT></B>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Baa2</FONT>&nbsp;
        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<FONT size=1 face="serif">United Mexican States, 8.00%, 9/24/22</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">3,445,500</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<B><FONT size=1 face="serif">Total Long-Term Investments </FONT></B><FONT size=1 face="serif">(cost $549,598,840)</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">571,348,570</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<B><FONT size=2 face="serif">SHORT-TERM INVESTMENTS&#151;0.7%</FONT></B>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">NR</FONT>&nbsp;
        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,100</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<FONT size=1 face="serif">HBOS Treasury Services PLC, 2.04%, 1/26/05</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">2,089,766</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">NR</FONT>&nbsp;
        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,200</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<FONT size=1 face="serif">Santander Hispano, 2.01%, 1/14/05</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">1,195,042</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<B><FONT size=1 face="serif">Total Short-Term Investments </FONT></B><FONT size=1 face="serif">(cost $3,284,808)</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">3,284,808</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<B><FONT size=2 face="serif">OUTSTANDING OPTIONS PURCHASED&#151;0.1%</FONT></B>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<FONT size=1 face="serif">Interest Rate Swap,</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;


        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">24,800</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.365% over 3-month LIBOR, expires 1/28/05</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">243,131</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">17,500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.60% over 3-month LIBOR, expires 11/19/04</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">29,365</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">24,800</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.865% over 3-month LIBOR, expires 1/28/08</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">169,885</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">13,100</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.25% over 3-month LIBOR, expires 11/19/04</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">13</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<B><FONT size=1 face="serif">Total Outstanding Options Purchased </FONT></B><FONT size=1 face="serif">(cost $505,980)</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">442,394</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<B><FONT size=1 face="serif">Total investments before investments sold short and outstanding options written </FONT></B><FONT size=1 face="serif">(cost $553,389,628)</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">575,075,772</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<B><FONT size=2 face="serif">INVESTMENT SOLD SHORT&#151;(10.7)%</FONT></B>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">(45,000</FONT>
        </TD>
        <TD width=3% align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
        <TD width=62% align=left>
<FONT size=1 face="serif">Federal National Mortgage Assoc., 5.50%, TBA (proceeds $45,796,477)</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">(45,815,760</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD width="10%">
        </TD>
        <TD colspan=3>&nbsp;    </TD>
        <TD width="62%">
        </TD>
        <TD colspan=3>
<HR noshade size=1>
        </TD>
</TR>
<TR>
        <TD>&nbsp;

        </TD>
    <TD colspan=3><hr width="50" size=1 noshade></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left> &nbsp;<B></B>&nbsp;
        </TD>
        <TD colspan=3 align=left><center>
    <B><FONT size=2 face="serif">Contracts/Notional</FONT></B>    </center></TD>
        <TD align=left>&nbsp;</TD>
        <TD align=left>

        </TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>
      </center></TD>
        <TD width=62% align=left>&nbsp;

        </TD>
        <TD align=left>

        </TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>&nbsp;
      </center></TD>
        <TD width=62% align=left>&nbsp;

        </TD>
        <TD align=left>

        </TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD width="10%">
        </TD>
        <TD colspan=3>
      <hr width="50" size=1 noshade>
        </TD>
        <TD colspan=4>
        </TD>
</TR>
<TR>
        <TD colspan=8>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<B><FONT size=2 face="serif">OUTSTANDING OPTIONS WRITTEN&#151;(0.3%)</FONT></B>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<FONT size=1 face="serif">Interest Rate Swap,</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">(28,400</FONT>
        </TD>
        <TD width=3% align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
        <TD width=62% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">3.00% over 3-month LIBOR, expires 1/19/05</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">(82,205</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">(24,800</FONT>
        </TD>
        <TD width=3% align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
        <TD width=62% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.375% over 3-month LIBOR, expires 10/28/05</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">(468,273</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">(31,300</FONT>
        </TD>
        <TD width=3% align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
        <TD width=62% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.60% over 3-month LIBOR, expires 2/23/05</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">(273,343</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">(24,800</FONT>
        </TD>
        <TD width=3% align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
        <TD width=62% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.375% over 3-month LIBOR, expires 10/28/05</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">(418,239</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">(55,000</FONT>
        </TD>
        <TD width=3% align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
        <TD width=62% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.75% over 3-month LIBOR, expires 9/23/05</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">(129,250</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">(13,100</FONT>
        </TD>
        <TD width=3% align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
        <TD width=62% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.05% over 3-month LIBOR, expires 2/23/05</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">(5,502</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">(25</FONT>
        </TD>
        <TD width=3% align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
        <TD width=62% align=left>
<FONT size=1 face="serif">U.S. Treasury Notes Futures, expires 11/26/04</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">(25,781</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">(25</FONT>
        </TD>
        <TD width=3% align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
        <TD width=62% align=left>
<FONT size=1 face="serif">U.S. Treasury Notes Futures, expires 11/26/04</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">(391</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<B><FONT size=1 face="serif">Total Outstanding Options Written </FONT></B><FONT size=1 face="serif">(premium received $2,557,620)</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=1 face="serif">(1,402,984</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<B><FONT size=1 face="serif">Total investments net of investments sold short and outstanding options written&#151;123.7%</FONT></B>&nbsp;
        </TD>
        <TD align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD align=right>
<FONT size=1 face="serif">527,857,109</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<FONT size=1 face="serif">Liabilities in excess of other assets&#151;(23.7)%</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
      <FONT size=1 face="serif">(101,213,660</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR>
  <TD colspan=5></TD>
  <TD colspan=3><HR noshade size=1>
  </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=6% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=62% align=left>
<B><FONT size=1 face="serif">Net Assets&#151;100%</FONT></B>&nbsp;
        </TD>
        <TD align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD align=right>
<FONT size=1 face="serif">426,643,449</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=4>&nbsp;
        </TD>
        <TD width="62%">
        </TD>
        <TD colspan=3>
<HR noshade size=3>
        </TD>
</TR>
</TABLE>
<BR>
<TABLE border=0 cellspacing=0 cellpadding=0>
<TR>
  <TD colspan="2" valign=top nowrap><HR align="left" width="100" size=1 noshade></TD>
  </TR>
<TR valign="top">
        <TD nowrap>
<SUP><FONT size=1 face="serif">1</FONT></SUP>&nbsp; &nbsp; &nbsp;       </TD>
        <TD>
<FONT size=1 face="serif">Using the higher of S&amp;P&#146;s, Moody&#146;s or Fitch&#146;s rating.</FONT>       </TD>
</TR>
<TR valign="top">
        <TD nowrap>
<SUP><FONT size=1 face="serif">2</FONT></SUP>&nbsp; &nbsp; &nbsp;       </TD>
        <TD>
<FONT size=1 face="serif">Entire or partial principal amount pledged as collateral for reverse repurchase agreements or financial futures contracts.</FONT>     </TD>
</TR>
<TR valign="top">
        <TD nowrap>
<SUP><FONT size=1 face="serif">3</FONT></SUP></TD>
        <TD>
<FONT size=1 face="serif">Security is not registered under the Securities Act of 1933. These securities may be resold in transactions in accordance with Rule 144A under that Act, to qualified institutional buyers. As of October 31, 2004, the Trust
held 5.8% of its net assets, with a current market value of $24,880,897 in securities restricted as to resale.</FONT></TD>
</TR>
<TR><TD colspan=2>&nbsp;</TD></TR></TABLE>
<P>
<FONT size=1 face="serif">Details of open reverse repurchase agreements are disclosed in Note 4 in the Notes to Financial Statements.</FONT></P>
<P>
<FONT size=1 face="serif">A category in the Corporate Bonds section may contain multiple industries as defined by the SEC&#146;s Standard Industry Codes.</FONT></P>
<center>
  <FONT size=2 face="serif">See Notes to Financial Statements.</FONT><BR>
</center>
<P align="center">
<FONT size=2 face="serif">30</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT face="serif">PORTFOLIO OF INVESTMENTS</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT face="serif">OCTOBER 31, 2004</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD colspan=5 align=left>
 &nbsp;<B><FONT size=2 face="serif">BlackRock Income Trust Inc. (BKT)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>&nbsp;
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>&nbsp;
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=right>
      <center>
        <B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
      </center></TD>
        <TD colspan=3 align=right><center>
    <B><FONT size=2 face="serif"> (000)</FONT></B>        </center></TD>
        <TD width=70% align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><FONT size=2
face="serif">Description</FONT></B>&nbsp;
        </TD>
        <TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
      </center></TD>
  </TR>
<TR>
        <TD colspan=7>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">LONG-TERM INVESTMENTS&#151;148.9%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Mortgage Pass-Through Securities&#151;33.5%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal Home Loan Mortgage Corp.,</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=right>
<FONT size=1 face="serif">$</FONT>
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">15,414</FONT>
        </TD>
        <TD width=3%><SUP><FONT size=1 face="serif">2</FONT></SUP>
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.50%, 10/01/16 - 5/01/17</FONT>
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">15,979,706</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">87</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.50%, 5/01/29 - 5/01/30</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">91,840</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">24</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.50%, 2/01/23</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">25,580</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">136</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">8.00%, 11/01/15</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">144,486</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">90</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">8.50%, 10/01/06 - 3/01/08</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">93,510</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">270</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">9.00%, 9/01/20</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">302,589</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal National Mortgage Assoc.,</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">25,176</FONT>
        </TD>
        <TD width=3%><SUP><FONT size=1 face="serif">2</FONT></SUP>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.00%, 6/01/33 - 7/01/34</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">25,145,474</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">67,492</FONT></TD>
        <TD width=3%><SUP><FONT size=1 face="serif">2</FONT></SUP>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.50%, 12/01/13 - 8/01/34</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">69,544,223</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">11,587</FONT>
        </TD>
        <TD width=3%><FONT size=1 face="serif"></FONT><SUP><FONT size=1 face="serif">2</FONT></SUP>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.00%, 11/01/31 - 10/01/32</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">12,026,278</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5,991</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.50%, 2/01/26 - 5/01/31</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">6,310,412</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">9,872</FONT>
        </TD>
        <TD width=3%><SUP><FONT size=1 face="serif">2</FONT></SUP>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.00%, 6/01/26 - 2/01/32</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">10,479,209</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5,208</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.50%, 11/01/14 - 9/01/23</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5,622,041</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">546</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">8.00%, 5/01/08 - 5/01/22</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">577,390</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">12</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">9.50%, 1/01/19 - 9/01/19</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">13,955</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Government National Mortgage Assoc.,</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">148</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.00%, 10/15/17</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">158,872</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">838</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.50%, 8/15/21 - 12/15/23</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">908,965</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">596</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">8.00%, 10/15/22 - 2/15/29</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">651,415</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">56</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">9.00%, 6/15/18 - 9/15/21</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">63,011</FONT>
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Mortgage Pass-Through Securities</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">148,138,956</FONT>
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Federal Housing Administration&#151;2.4%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">GMAC Projects,</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">649</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 51, 7.43%, 2/01/23</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">689,419</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,067</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 56, 7.43%, 11/01/22</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,135,307</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">54</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Merrill Projects, Ser. 54, 7.43%, 5/15/23</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">57,795</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">872</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Reilly Project, Ser. 41, 8.28%, 3/01/20</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">914,091</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">USGI Projects,</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">206</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 87, 7.43%, 12/01/22</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">219,098</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">963</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 99, 7.43%, 10/01/23</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,024,230</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">6,047</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Yorkville, Ser. 6094, 7.43%, 6/01/21</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">6,429,203</FONT>
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Federal Housing Administration</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">10,469,143</FONT>
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=center>
      <div align="left"><B><FONT size=2 face="serif">Agency Multiple Class Mortgage Pass-Through Securities&#151;17.7%</FONT></B>&nbsp;
      </div></TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal Home Loan Mortgage Corp.,</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">6,960</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 11, Class A9, 5.00%, 1/25/28</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">6,232,320</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">447</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 19, Class F, 8.50%, 3/15/20</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">447,376</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1598, Class J, 6.50%, 10/15/08</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,205,740</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,375</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2534, Class NG, 4.50%, 3/15/22</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,378,835</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">12,751</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2758, Class KV, 5.50%, 5/15/23</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">13,211,499</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,240</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2765, Class UA, 4.00%, 3/15/11</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,171,638</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal National Mortgage Assoc.,</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">9,551</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 28, Class PB, 6.00%, 8/25/28</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">10,055,154</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,419</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 29, Class HC, 7.50%, 7/25/30</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,700,068</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,903</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 31, Class ZG, 7.50%, 5/25/34</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,205,517</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">9,133</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 32, Class VT, 6.00%, 9/25/15</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">9,456,453</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">430</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 43, Class E, 7.50%, 4/25/22</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">448,772</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,749</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 60, Class PA, 5.50%, 4/25/34</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,821,056</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5,000</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 81, Class BR, 5.25%, 4/25/25</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5,101,050</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">12,264</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 135, Class PB, 6.00%, 1/25/34</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">12,796,626</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Government National Mortgage Assoc.,</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,216</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 5, Class Z, 7.00%, 5/16/26</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,360,047</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,500</FONT>
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 33, Class PB, 6.50%, 7/20/31</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,604,274</FONT>
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Agency Multiple Class Mortgage Pass-Through Securities</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">78,196,425</FONT>
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=center>
      <div align="left"><B><FONT size=2 face="serif">Non-Agency Multiple Class Mortgage Pass-Through Securities&#151;0.0%</FONT></B>&nbsp;
      </div></TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% height="18" align=center>
<FONT size=1 face="serif">AAA</FONT>
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">212</FONT>
        </TD>
        <TD width=3%><SUP><FONT size=1 face="serif">3</FONT></SUP>
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Summit Mortgage Trust, Ser. 1, Class B1, 5.904%, 12/28/12</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">212,141</FONT>
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD align=center colspan=7>
<FONT size=2 face="serif">See Notes to Financial Statements.</FONT>
        </TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2 face="serif">31</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT size=2 face="serif">BlackRock Income Trust Inc. (BKT) (continued)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan=3 align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left> <center>
          <B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
    </center></TD>
        <TD colspan=3 align=left>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>
      <center>
        <B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
      </center></TD>
        <TD colspan=3 align=left>
      <center>
        <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>&nbsp;
    </center></TD>
        <TD width=70% align=center>
<B><FONT size=2 face="serif">Description</FONT></B>&nbsp;
        </TD>
        <TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
      </center></TD>
  </TR>
<TR>
        <TD colspan=7>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Adjustable Rate Mortgage Securities-0.1%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal National Mortgage Assoc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>
      <div align="right"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">184</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 38, Class F, 8.325%, 4/25/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">202,245</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">43</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 256, Class F, 3.438%, 11/25/23</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">37,674</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Adjustable Rate Mortgage Securities</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">239,919</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Inverse Floating Rate Mortgage Securities&#151;3.7%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal Home Loan Mortgage Corp.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">70</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1160, Class F, 32.194%, 10/15/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">81,632</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">753 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1616, Class SB, 8.50%, 11/15/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">771,944</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,524</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1688, Class S, 10.303%, 12/15/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,671,560</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,626</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2664, Class SR, 8.854, 8/15/33</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,227,524</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,456</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2752, Class SV, 15.428%, 9/15/33</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,490,316</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal National Mortgage Assoc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">78</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 7, Class S, 3/25/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">11,366</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">186</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 38, Class SA, 10.186%, 4/25/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">196,538</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">38</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 46, Class S, 20.753%, 5/25/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">10,348</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">45</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 49, Class S, 8.431%, 12/25/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,531</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,239</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 72, Class S, 8.75%, 5/25/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,283,992</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">237</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 87, Class S, 21.797%, 8/25/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">280,580</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">549</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 93, Class S, 8.50%, 5/25/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">566,640</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">44</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 145, Class S, 29.269%, 10/25/06</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">49,997</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">284</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 170, Class SC, 9.00%, 9/25/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">292,484</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,162</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 196, Class SC, 8.973%, 10/25/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,265,555</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">755</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 214, Class SH, 13.569%, 12/25/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">795,440</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,936</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 247, Class SN, 10.00%, 12/25/23</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,985,787</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">404</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Kidder Peabody Acceptance Corp., Ser. 1, Class A6, 13.032%, 8/25/23</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">412,683</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Inverse Floating Rate Mortgage Securities</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">16,398,917</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Interest Only Asset-Backed Securities&#151;1.6%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Sterling Coofs Trust,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">51,687</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1, 4/15/29</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,590,415</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">33,705</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2, 3/30/30</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,685,867</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Interest Only Asset-Backed Securities</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">7,276,282</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Interest Only Mortgage-Backed Securities&#151;15.5%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">11,325</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">ABN Amro Mortgage Corp., Ser. IV, Class A2, 3/25/33</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">497,167</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">American Housing Trust,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">320</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. III, Class 4, 3/25/19</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,999</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">76</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. VII, Class 2, 11/25/20</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">180,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan=2 align=right>
<FONT size=1 face="serif">100,158</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Commercial Mortgage Acceptance Corp., Ser. ML1, 12/15/30</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,208,879</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">30,590 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=center>
      <div align="left"><FONT size=1 face="serif">Credit Suisse First Boston Mortgage Securities Corp., Ser. C1, Class AX, 6/20/29</FONT>&nbsp;
      </div></TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,415,706</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal Home Loan Mortgage Corp.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">16,455</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 60, Class HS, 4/25/24</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">532,975</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">11</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 176, Class M, 7/15/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">150</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 192, Class U, 2/15/22</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">164</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,824</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 204, 5/1/29</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">706,218</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">35</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1043, Class H, 2/15/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">48,406</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1054, Class I, 3/15/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">865</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">33</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1056, Class KD, 3/15/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,354</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">41</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1057, Class J, 3/15/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">8,788</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">115</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1148, Class E, 10/15/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,375</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">30</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1179, Class O, 11/15/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">522</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">29</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1221 Class H, 3/15/07</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">501</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">900</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1706, Class IA, 10/15/23</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">75,519</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">289</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1720, Class PK, 1/15/24</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">28,041</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">8,498</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1914, Class PC, 12/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">100,696</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">10,672</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2002, Class HJ, 10/15/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">251,590</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">211</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2099, Class JB, 9/15/22</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">11,483</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,911</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2296, Class SA, 3/15/16</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">153,816</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,425</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2444, Class ST, 9/15/29</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">110,784</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,319</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2513, Class BI, 12/15/15</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">67,217</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,615</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2542, Class MX, 5/15/22</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">297,603</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,385</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2543, Class IM, 9/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">109,552</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5,658</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2545, Class NI, 3/15/22</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">639,129</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">38,385</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2559, Class IO, 8/15/30</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">161,936</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">9,087</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2561, Class EW, 9/15/16</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">845,953</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD align=center colspan=7>
<FONT size=2 face="serif">See Notes to Financial Statements.</FONT>
        </TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2 face="serif">32</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT size=2 face="serif">BlackRock Income Trust Inc. (BKT) (continued)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>&nbsp;
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left> <center>
          <B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
    </center></TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>&nbsp;
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=right>
      <center>
        <B><FONT size=2 face="serif">(unaudited)</FONT></B>
      </center></TD>
        <TD colspan=3 align=right><center>
          <B><FONT size=2 face="serif"> (000)</FONT></B>&nbsp;
    </center></TD>
        <TD width=70% align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><FONT size=2
face="serif">Description</FONT></B>&nbsp;
        </TD>
        <TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
      </center></TD>
  </TR>
<TR>
        <TD colspan=7>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>&nbsp;</TD>
        <TD width=70% align=center>
      <div align="left"><B><FONT size=2 face="serif">Interest Only Mortgage-Backed Securities&#151;(cont&#146;d)</FONT></B>&nbsp;
      </div></TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>&nbsp;</TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal Home Loan Mortgage Corp.&#151;(cont&#146;d),</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=right>
<FONT size=1 face="serif">$</FONT>
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">16,571</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2611, Class QI, 9/15/32</FONT>
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,135,398</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">26,066</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2633, Class PI, 3/15/12</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,371,849</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">6,145</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2653, Class MI, 4/15/26</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">898,100</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">11,549</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2658, Class PI, 6/15/13</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,000,178</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5,662</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2672, Class TQ, 3/15/23</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">664,475</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">12,324</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2676, Class JI, 8/15/13</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">746,487</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,633</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2687, Class IL, 9/15/18</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">663,702</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">26,076</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2687, Class IQ, 9/15/22</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,993,021</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">6,533</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2693, Class IB, 6/15/13</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">673,848</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,841</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2694, Class LI, 7/15/19</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">564,144</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,050</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2750, Class TC, 2/15/34</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,043,461</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">9,253</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2773, Class OX, 2/15/18</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,162,347</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">20,215</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2779, Class YS, 1/15/33</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,027,805</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">28,207</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2780, Class SM, 4/15/34</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,530,023</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">22,898</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2786, Class PI, 10/15/10</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,244,265</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,571</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2791, Class KS, 5/15/34</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,687,652</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>&nbsp;</TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal National Mortgage Assoc.,</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">433</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 5, Class H, 1/25/22</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">62,334</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">26</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 7, Class 2, 4/1/17</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,699</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">222</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 10, Class S, 5/25/21</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">26,853</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">175</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 12, Class S, 5/21/21</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">34,201</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">114</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 17, Class S, 6/25/21</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">16,650</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">6,455</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 11, Class PI, 1/25/19</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">157,507</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">111</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 12, Class C, 2/25/22</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">19,683</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">12,037</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 13, Class IG, 10/25/22</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,133,633</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">23,150</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 16, Class PI, 11/25/12</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,228,826</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 20, Class H, 3/25/06</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">49</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">154</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 33, Class PV, 10/25/21</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">35,241</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,907</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 33, Class SG, 3/25/09</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">290,121</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,504</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 37, Class SE, 10/25/22</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">14,768</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">14</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 38, Class N, 4/25/21</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,578</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">126</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 50, Class G, 12/25/21</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">17,674</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,497</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 50, Class SI, 4/25/23</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">34,627</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">7,372</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 51, Class IE, 4/25/26</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">902,203</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 54, Class H, 5/25/05</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">84</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">6,044</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 55, Class GI, 7/25/19</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,049,839</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,254</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 60, Class SB, 10/25/22</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">29,087</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,782</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 62, Class IC, 7/25/15</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">96,704</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,837</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 62, Class IL, 3/25/24</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">57,708</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">23,489</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 64, Class QI, 1/25/33</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,537,986</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">8,384</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 66, Class CI, 7/25/33</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,680,842</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5,725</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 68, Class SC, 1/25/24</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">532,825</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">6,814</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 71, Class EI, 8/25/33</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,328,203</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">6,530</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 82, Class IR, 9/25/12</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">320,375</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">13</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 84, Class H, 8/25/06</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">809</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">29,836</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 88, Class TI, 11/25/13</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,593,545</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">46</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 89, Class 2, 6/1/18</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">7,470</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">46,000</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 90, Class JH, 6.00%, 12/31/49</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,909,063</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">23,742</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 90, Class M, 1/25/28</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,634,731</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">13</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 94, Class 2, 8/1/21</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,636</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">56</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 99, Class L, 8/25/21</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">7,890</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">6,639</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 122, Class IA, 9/25/09</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">241,184</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,741</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 122, Class IC, 9/25/18</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">733,499</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">10</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 123, Class M, 10/25/20</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,521</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">79</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 136, Class S, 11/25/20</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">85,096</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">90</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 139, Class PT, 10/25/21</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">9,314</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">45</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 141, Class SA, 8/25/07</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">8,919</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,554</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 199, Class SB, 10/25/23</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">344,679</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,043</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 302, Class 2, 6/1/29</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">759,439</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">7,958</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 602, Class BI, 10/25/22</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,017,977</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,326</FONT>
        </TD>
        <TD width=3% align=right>&nbsp;</TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. W4, 12/25/28</FONT>
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">210,051</FONT>
        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD align=center colspan=7>
<FONT size=2 face="serif">See Notes to Financial Statements.</FONT>
        </TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2 face="serif">33</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT size=2 face="serif">BlackRock Income Trust Inc. (BKT) (continued)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>&nbsp;
      </center></TD>
        <TD width=70% align=center>
<B><FONT size=2 face="serif">Description</FONT></B>&nbsp;
        </TD>
        <TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
      </center></TD>
  </TR>
<TR>
        <TD colspan=7>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Interest Only Mortgage-Backed Securities&#151;(cont&#146;d)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=right>
<FONT size=1 face="serif">$</FONT>
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">155</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">First Boston Mortgage Securities Corp., Ser. C, Class I, 4/25/17</FONT>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">27,895</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">30,435</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">GMAC Commercial Mortgage Securities, Inc., Ser. C1, Class X, 7/15/27</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,372,249</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">19,276 </FONT></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Goldman Sachs Mortgage Securities Corp., Ser. 5, 2/19/25</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">407,352</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Government National Mortgage Assoc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">6,124</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 39, Class ID, 5.00%, 5/20/33</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">685,942</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,087</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 58, Class IT, 5.50%, 7/20/33</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">651,105</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">9,341 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Hanover Grantor Trust, Ser. A, Class 1, 8/1/27</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">44,838</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">140</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Kidder Peabody Acceptance Corp., Ser. B, Class A2, 4/22/18</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">27,254</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,019</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">MASTR Alternative Loan Trust, Ser. 9, Class 15X2, 1/25/19</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">350,062</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">135,942</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">MLCC Mortgage Investors, Inc., Ser. A, Class XA, 3/25/28</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,333,155</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Morgan Stanley Mortgage Trust,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">121</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 38, Class 2, 11/20/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">21,731</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">128</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 39, Class 2, 12/20/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">23,042</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,275</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Merrill Lynch Mortgage Investors, Inc., Ser. C2, 6/15/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">74,823</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,077</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Morgan Stanley Cap. Trust I, Ser. 3, Class 1AX, 5/25/19</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">369,256</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">8,698</FONT>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Morgan Stanley Capital I, Inc., Ser. HF1, Class X, , 6/15/17</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">225,073</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,812</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Residential Accredit Loans, Inc., Ser. QS7, Class A1, 4/25/33</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">487,150</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">19,955</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Small Business Administration, Ser. 1, 4/1/15</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">149,665</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">168,425</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Vendee Mortgage Trust, Ser. 2, Class 1, 5/15/29</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">247,583</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Interest Only Mortgage-Backed Securities</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">68,552,441</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Principal Only Mortgage-Backed Securities&#151;8.7%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">136</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Collateralized Mortgage Obligation Trust, Ser. 29, Class A, 5/23/17</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">123,002</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Countrywide Home Loans, Inc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">8,202</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 26, 8/25/33</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5,197,917</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,504</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. J4, 6/25/33</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,177,651</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,084</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. J5, 7/25/33</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,320,685</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,531</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. J8, 9/25/23</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">944,081</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Drexel Burnham Lambert, Inc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">60</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. K, Class 1, 9/23/17</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">53,370</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">614</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. V, Class 1, 9/1/18</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">566,390</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal Home Loan Mortgage Corp.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">495</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 8, Class A10, 11/15/28</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">420,211</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">321</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1418, Class M, 11/15/22</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">278,885</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">775</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1571, Class G, 8/15/23</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">566,075</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,311</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1691, Class B, 3/15/24</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,849,534</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">494</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1739, Class B, 2/15/24</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">433,020</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal National Mortgage Assoc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">643</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2, Class KB, 1/25/23</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">536,116</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">83</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 7, Class J, 2/25/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">70,475</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,993</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 13, Class PR, 3/25/32</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,636,862</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">154</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 51, Class E, 2/25/23</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">125,749</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">54</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 70, Class A, 5/25/23</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">48,493</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">71</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 167, Class D, 10/25/17</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">68,337</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">95</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 203, Class 1, 2/1/23</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">85,378</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">68</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 228, Class 1, 5/1/23</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">60,186</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,286</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 249, Class B, 11/25/23</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,861,463</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">526</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 273, Class 1, 7/1/26</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">471,798</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">9,444</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 328, Class 1, 11/1/32</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">8,006,596</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">6,216</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 338, Class 1, 6/1/33</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5,054,189</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">657</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. W4, 2/25/29</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">509,093</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">92</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">First Union Residential Securitization Trust, Ser. A, Class 1APO, 3/25/15</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">90,877</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">700</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">MASTR Asset Securitization Trust, Ser. 3, Class 4A15, 3/25/34</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">348,270</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">45</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Structured Mortgage Asset Residential Trust, Ser. 3C, Class CX, 4/25/24</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">41,270</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">NR</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">13,000 </FONT></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Resolution Funding Corp., Ser. B, 4/15/30</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,404,700</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Principal Only Mortgage-Backed Securities</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">38,350,673</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Commercial Mortgage-Backed Securities&#151;2.8%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">10,250 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">New York City Mortgage Loan Trust, Multi-Family, Class A2, 6.75%, 6/25/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">11,002,893</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Aaa</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,278</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Banc of America Alternative Loan Trust, Ser. 11, Class 5A1, 5.50%, 1/25/19</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,284,181</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Commercial Mortgage-Backed Securities</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">12,287,074</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Collateralized Mortgage Obligations&#151;14.7%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal Home Loan Mortgage Corp.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,185</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1961, Class H, 5/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,248,754</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">7,372</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2218, Class Z, 3/15/30</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">8,580,066</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">13,884</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2461, Class Z, 6/15/32</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">14,985,160</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD align=center colspan=7>
<FONT size=2 face="serif">See Notes to Financial Statements.</FONT>
        </TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2 face="serif">34</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT size=2 face="serif">BlackRock Income Trust Inc. (BKT) (continued)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan=3 align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left> <center>
          <B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
    </center></TD>
        <TD colspan=3 align=right>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>
      <center>
        <B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
      </center></TD>
        <TD colspan=3 align=left>
      <center>
        <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>&nbsp;
    </center></TD>
        <TD width=70% align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><FONT size=2
face="serif">Description</FONT></B>&nbsp;
        </TD>
        <TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
      </center></TD>
  </TR>
<TR>
        <TD colspan=7>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Collateralized Mortgage Obligations&#151;(cont&#146;d)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">GSR Mortgage Loan Trust,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>
      <div align="right"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">6,264</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 10, Class 2A1, 10/25/33</FONT>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">6,164,374</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">6,051</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 13, Class 1A1, 10/25/33</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">6,014,792</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,966</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">MASTR Alternative Loan Trust, Ser. 7, Class 4A3, 11/25/18</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,279,923</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">9,966</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">MASTR Asset Securitization Trust, Ser. 12, Class 3A5, 10/25/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">10,003,320</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">13,717</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Residential Funding Securities Corp., Ser. RM2, Class A15, 5/25/33</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">15,259,798</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Collateralized Mortgage Obligations</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">65,536,187</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Collateralized Mortgage Obligation Residuals&#151;0.1%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Collateralized Mortgage Obligation Trust,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">7</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 40, Class R, 4/01/18</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">664</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">122</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 42, Class R, 10/01/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">16,647</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">FBC Mortgage Securities Trust 16, Ser. A, Class 1, 7/01/17</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">283,265</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal Home Loan Mortgage Corp.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">42</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 19, Class R, 3/15/20</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,975</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">0</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 75, Class R, 1/15/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">11</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">0</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 75, Class RS, 1/15/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">11</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">0</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 173, Class R, 11/15/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">49</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">0</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 173, Class RS, 11/15/21</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">49</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">59</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 200, Class R, 12/15/22</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,096</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">13 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">4</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">PaineWebber Trust, Ser. 88 M, Class 6, 9/01/18</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">0</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Collateralized Mortgage Obligation Residuals</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">306,767</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">U.S. Government and Agency Securities&#151;47.1%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">17,115</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Overseas Private Investment Corp., zero coupon-7.35%, 5/29/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">17,814,428</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Small Business Administration,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,230</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 20C-1, 7.15%, 3/01/17</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,331,001</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,681</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 20E-1, 7.60%, 5/01/16</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,816,220</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,316</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 20F-1, 7.55%, 6/01/16</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,503,396</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,419</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 20G-1, 7.70%, 7/01/16</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,538,859</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,954</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 20H-1, 7.25%, 8/01/16</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,106,439</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,321</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 20K-1, 6.95%, 11/01/16</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,564,648</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,805</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Small Business Investment Companies, Ser. P10A, Class 1, 6.12%, 2/01/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,918,298</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">U.S. Treasury Bonds,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">129,000 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">zero coupon, 11/15/24</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">46,657,107</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">550</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.125%, 11/15/27</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">646,730</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">U.S. Treasury Notes,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">50,000 </FONT></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">1.50%, 3/31/06</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">49,414,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">42,600 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">2.50%, 5/31/06</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">42,640,044</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">3.875%, 2/15/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,000,936</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">745</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.00%, 2/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">745,231</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">9,000 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.25%, 11/15/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">9,185,670</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">20,200 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.25%, 8/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">20,553,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,250 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.375%, 8/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,372,883</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total U.S. Government and Agency Securities</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">208,809,390</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Corporate Bonds&#151;1.0%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Financial Institutions&#151;1.0%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">NR</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,380 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2,5</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Structured Asset Receivable Trust, 1.649%, 1/21/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,372,797</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=1 face="serif">Total Long-Term Investments </FONT></B><FONT size=1 face="serif">(cost $667,477,527)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">659,147,112</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">SHORT-TERM INVESTMENT&#151;2.6%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">U.S Government and Agency Security&#151;2.6%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>&nbsp;

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">11,534</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">U.S. Treasury Bonds, 1.57%, 11/03/04 (cost $11,533,550)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">11,533,550</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
</TABLE>
<center>
  <BR>
  <FONT size=2 face="serif">See Notes to Financial Statements.</FONT><BR>
</center>
<P align="center">
<FONT size=2 face="serif">35</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT size=2 face="serif">BlackRock Income Trust Inc. (BKT) (continued)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=8>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Principal/</FONT></B>
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Notional</FONT></B>
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left> <center>
          <B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
    </center></TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>
      </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>
      <center>
        <B><FONT size=2 face="serif">(unaudited) </FONT></B>
    </center></TD>
        <TD colspan=3 align=left>      <center>
    <B><FONT size=2 face="serif">(000)</FONT></B>      </center></TD>
        <TD width=70% align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><FONT size=2
face="serif">Description</FONT></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>

          <center>
      <B><FONT size=2 face="serif">Value</FONT></B>         </center></TD>
  </TR>
<TR>
        <TD colspan=8>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">OUTSTANDING OPTIONS PURCHASED&#151;0.1%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Interest Rate Swap,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=right>
<FONT size=1 face="serif">$</FONT>
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">24,800</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.365% over 3-month LIBOR, expires 1/28/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD align=right>
<FONT size=1 face="serif">243,131</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">18,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.60% over 3-month LIBOR, expires 11/19/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">30,204</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">24,800</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.865% over 3-month LIBOR, expires 1/28/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">169,885</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">13,500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.25% over 3-month LIBOR, expires 11/19/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">14</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=1 face="serif">Total Outstanding Options Purchased </FONT></B><FONT size=1 face="serif">(cost $508,240)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">443,234</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total investments before investments sold short and outstanding options written (cost $679,519,317)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">671,123,896</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">INVESTMENTS SOLD SHORT&#151;(3.0%)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">(1,500</FONT>
        </TD>
        <TD width=3% align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal National Mortgage Assoc., 5.50%, TBA</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">(1,527,187</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">(10,630</FONT>
        </TD>
        <TD width=3% align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">U.S. Treasury Bonds, 5.375%, 2/15/31</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">(11,550,133</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=1 face="serif">Total Investments Sold Short </FONT></B><FONT size=1 face="serif">(proceeds $12,897,590)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">(13,077,320</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">OUTSTANDING OPTIONS WRITTEN&#151;(0.3%)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Interest Rate Swap,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">(29,200</FONT>
        </TD>
        <TD width=3% align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">3.00% over 3-month LIBOR, expires 1/19/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">(84,520</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">(24,800</FONT>
        </TD>
        <TD width=3% align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.375% over 3-month LIBOR, expires 10/28/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">(468,273</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">(13,500</FONT>
        </TD>
        <TD width=3% align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.05% over 3-month LIBOR, expires 2/23/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">(383,535</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">(24,800</FONT>
        </TD>
        <TD width=3% align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.375% over 3-month LIBOR, expires 10/28/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">(418,240</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">(77,000</FONT>
        </TD>
        <TD width=3% align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.75% over 3-month LIBOR, expires 9/23/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">(180,950</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">(13,500</FONT>
        </TD>
        <TD width=3% align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.05% over 3-month LIBOR, expires 2/23/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">(5,670</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=1 face="serif">Total Outstanding Options Written </FONT></B><FONT size=1 face="serif">(premium received $2,915,166)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">(1,541,188</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=1 face="serif">Total investments net of investments sold short and outstanding options written&#151;148.3%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD align=right>
<FONT size=1 face="serif">656,505,388</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Liabilities in excess of other assets&#151;(48.3)%</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
      <FONT size=1 face="serif">(213,870,772</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR>
  <TD colspan=5></TD>
  <TD colspan=3><HR align="left" size=1 noshade>
  </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=1 face="serif">Net Assets&#151;100%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD align=right>
<FONT size=1 face="serif">442,634,616</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR align="left" size=3 noshade>
        </TD>
</TR>
</TABLE>
<BR>
<TABLE border=0 cellspacing=0 cellpadding=0>
<TR>
  <TD colspan="2" valign=top nowrap><hr align="left" width="100" size="1" noshade></TD>
  </TR>
<TR>
        <TD nowrap valign=top>
<SUP><FONT size=1 face="serif">1</FONT></SUP>&nbsp; &nbsp; &nbsp;       </TD>
        <TD>
<FONT size=1 face="serif">Using the higher of S&amp;P&#146;s, Moody&#146;s or Fitch&#146;s rating.</FONT>       </TD>
</TR>
<TR>
        <TD nowrap valign=top>
<SUP><FONT size=1 face="serif">2</FONT></SUP>&nbsp; &nbsp; &nbsp;       </TD>
        <TD>
<FONT size=1 face="serif">Entire or partial principal amount pledged as collateral for reverse repurchase agreements or financial futures contracts.</FONT>     </TD>
</TR>
<TR>
        <TD nowrap valign=top>
<SUP><FONT size=1 face="serif">3</FONT></SUP></TD>
        <TD>
<FONT size=1 face="serif">Security is not registered under the Securities Act of 1933. These securities may be resold in transactions in accordance with Rule 144A under that Act, to qualified institutional buyers. As of October 31, 2004, the Trust
held 3.3% of its net assets, with a current market value of $14,485,164, in securities restricted as to resale.</FONT></TD>
</TR>
<TR>
        <TD nowrap valign=top>
<SUP><FONT size=1 face="serif">4</FONT></SUP>&nbsp; &nbsp; &nbsp;       </TD>
        <TD>
<FONT size=1 face="serif">Security is fair valued.</FONT>       </TD>
</TR>
<TR>
        <TD nowrap valign=top>
<SUP><FONT size=1 face="serif">5</FONT></SUP>&nbsp; &nbsp; &nbsp;       </TD>
        <TD>
<FONT size=1 face="serif">This bond is borrowed. The rate shown is the yield on the collateral deposited with the counterparty.</FONT>  </TD>
</TR>
<TR><TD colspan=2>&nbsp;</TD></TR></TABLE>
<P>
<FONT size=1 face="serif">Details of open reverse repurchase agreements are disclosed in Note 4 in the Notes to Financial Statements.</FONT></P>
<center>
  <FONT size=2 face="serif">See Notes to Financial Statements.</FONT><BR>
</center>
<P align="center">
<FONT size=2 face="serif">36</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT face="serif">PORTFOLIO OF INVESTMENTS</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT face="serif">OCTOBER 31, 2004</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD colspan=5 align=left>
 &nbsp;<B><FONT size=2 face="serif">BlackRock Limited Duration Income Trust (BLW)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=right>&nbsp;</TD>
        <TD colspan=3 align=right><center>
    <B><FONT size=2 face="serif">Principal</FONT></B>     </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=right>
      <center>
        <B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1 </FONT></SUP></B>
    </center></TD>
        <TD colspan=3 align=right><center>
    <B><FONT size=2 face="serif">Amount</FONT></B>        </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>&nbsp;
      </center></TD>
        <TD width=70% align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><FONT size=2
face="serif">Description</FONT></B>&nbsp;
        </TD>
        <TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
      </center></TD>
  </TR>
<TR>
        <TD colspan=7>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">LONG-TERM INVESTMENTS&#151;136.6%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Corporate Bonds&#151;58.2%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Aero &amp; Defense&#151;2.3%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">NR</FONT>&nbsp;
        </TD>
        <TD width=4% align=right>
<FONT size=1 face="serif">$</FONT>
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">AAR Corp., Ser. 20001A2, 8.39%, 5/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
      </div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">975,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">NR</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Raytheon Co., 7.00%, 5/15/06</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,223,856</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Sequa Corp., Ser. B, 8.875%, 4/01/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5,431,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5,881</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Transdigm, Inc., 8.375%, 7/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">6,326,375</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">16,956,481</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Automotive&#151;4.7%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B2</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,750</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Collins &amp; Aikman Products Co., 10.75%, 12/31/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,750,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">7,500</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">DaimlerChrysler NA Holding Corp., 4.05%, 6/04/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">7,532,475</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B1</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Dura Operating Corp., Ser. B, 8.625%, 4/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,970,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">7,500</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Ford Motor Credit Co., 7.375%, 2/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">8,135,963</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Baa1</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">7,500</FONT></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">General Motors Acceptance Corp., 6.875%, 8/28/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">7,766,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,640</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">TRW Automotive, Inc., 9.375%, 2/15/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5,336,000</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">34,490,688</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Basic Materials&#151;6.9%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,820</FONT></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">BCP Caylux Holdings SCA, 9.625%, 6/15/14 (Luxembourg)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,158,400</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Caraustar Industries, Inc., 9.875%, 4/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,350,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5,685</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Georgia Pacific Corp., 8.875%, 2/01/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">6,708,300</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B2</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,300</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Gold Kist, Inc., 10.25%, 3/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,469,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,500</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Huntsman Advanced Materials LLC, 11.00%, 7/15/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,900,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Huntsman LLC, 11.625%, 10/15/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,536,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Ipsco, Inc., 8.75%, 6/01/13 (Canada)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5,737,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Lyondell Chemical Co., 11.125%, 7/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5,893,750</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Rockwood Specialties Group, Inc., 10.625%, 5/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5,550,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Ba2</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,250</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">United States Steel LLC, 10.75%, 8/01/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,851,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">7,500 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Weyerhaeuser Co., 5.25%, 12/15/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">7,907,655</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">51,062,105</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Building &amp; Development&#151;0.4%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">DR Horton, Inc., 5.875%, 7/01/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,007,500</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Conglomerates&#151;1.5%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Trimas Corp., 9.875%, 6/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,090,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">7,500</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Tyco Intl. Group SA, 6.125%, 11/01/08 (Luxembourg)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">8,145,375</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">11,235,375</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Consumer Products&#151;2.7%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Group 1 Automotive, Inc., 8.25%, 8/15/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5,300,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">JC Penney Co., Inc., 8.00%, 3/01/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5,737,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Rite Aid Corp., 8.125%, 5/01/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5,325,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Sonic Automotive, Inc., Ser. B, 8.625%, 8/15/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,692,500</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">20,055,000</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Containers &amp; Glass&#151;1.6%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Graham Packaging Co., Inc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">785</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">8.50%, 10/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">822,288</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,100</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">9.875%, 10/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,163,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Graphic Packaging Intl., Inc., 9.50%, 8/15/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5,762,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Silgan Holdings, Inc., 6.75%, 11/15/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,120,000</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">11,868,038</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Ecological Services &amp; Equipment&#151;2.0%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5,548</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Allied Waste NA, Inc., Ser. B, 10.00%, 8/01/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5,797,660</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Casella Waste Systems, Inc., 9.75%, 2/01/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,220,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">6,250</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">National Waterworks, Inc., Ser. B, 10.50%, 12/01/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">7,000,000</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">15,017,660</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD align=center colspan=7>
<FONT size=2 face="serif">See Notes to Financial Statements.</FONT>
        </TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2 face="serif">37</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<A name="page_40"></A>

<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD height="17" colspan=5 align=left>      <div align="left"><B><FONT size=2 face="serif">BlackRock Limited Duration Income Trust (BLW) (continued)</FONT></B>
    </div></TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=left>

        </TD>
</TR>
<TR>
        <TD height="17" colspan=7>

          <center>
    </center></TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>      <center>
    </center></TD>
        <TD height="17" colspan=3 align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>
          </center></TD>
        <TD width="70%" height="17" align=left>

        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=left>

        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=right>      <center>
          <B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1 </FONT></SUP></B>
        </center></TD>
        <TD height="17" colspan=3 align=right><center>
    <B><FONT size=2 face="serif">Amount</FONT></B>        </center></TD>
        <TD width="70%" height="17" align=left>

        </TD>
        <TD colspan="2" rowspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>
          </center></TD>
  </TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>      <center>
          <B><FONT size=2 face="serif">(unaudited)</FONT></B>
    </center></TD>
        <TD height="17" colspan=3 align=left>
      <center>
    <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>      </center></TD>
        <TD width="70%" height="17" align=left>
                              <B><FONT size=2
face="serif">Description</FONT></B>
        </TD>
  </TR>
<TR>
        <TD height="17" colspan=7>
<HR align="center" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>

          <center>
    </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<B><FONT size=2 face="serif">Energy&#151;7.4%</FONT></B>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=left>

        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">BB</FONT>
          </center></TD>
        <TD width="4%" height="17" align=center>
      <div align="right"><FONT size=1 face="serif">$</FONT>
          </div></TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">5,500</FONT><SUP></SUP>
        </TD>
        <TD width="3%" height="17" align=left><SUP><FONT size=1 face="serif">2,3</FONT></SUP>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">AES Corp., The, 8.75%, 5/15/13</FONT>
        </TD>
        <TD width="1%" height="17" align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
          </div></TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">6,331,874</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">BB</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">5,290</FONT>
        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">Chesapeake Energy Corp., 7.50%, 9/15/13</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">5,911,574</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">BB</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">Compagnie Generale de Geophysique SA, 10.625%, 11/15/07 (France)</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">2,116,000</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">B</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">5,000</FONT>
        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">Dresser, Inc., 9.375%, 4/15/11</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">5,575,000</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">B</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">4,475 </FONT><SUP></SUP>
        </TD>
        <TD width="3%" height="17" align=left><SUP><FONT size=1 face="serif">2,3</FONT></SUP>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">Dynegy Holdings, Inc., 10.125%, 7/15/13</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">5,213,374</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">B-</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">4,000</FONT>
        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">El Paso Production Holding Co., 7.75%, 6/01/13</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">4,180,000</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">BB-</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">2,160</FONT><SUP></SUP>
        </TD>
        <TD width="3%" height="17" align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">Gazprom, 9.625%, 3/01/13 (Russia)</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">2,484,000</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">B+</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">2,950</FONT>
        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">Hanover Equipment Trust, Ser. B, 8.75%, 9/01/11</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">3,245,000</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">B</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">5,000</FONT></TD>
        <TD width="3%" height="17" align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">Hilcorp Energy I LP, 10.50%, 9/01/10</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">5,637,500</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">A-</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">Massey Energy Corp., 6.95%, 3/01/07</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">2,100,000</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">B1</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">5,000</FONT>
        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">Midwest Generation LLC, Ser. A, 8.30%, 7/02/09</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">5,400,000</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">B</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">5,000</FONT>
        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">Swift Energy Co., 9.375%, 5/01/12</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">5,600,000</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">B+</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">Williams Cos, Inc., 8.125%, 3/15/12</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">1,175,000</FONT>
        </TD>
</TR>
<TR>
        <TD height="17" colspan=5>
          <center>
    </center></TD>
        <TD height="17" colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>

          <center>
    </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>

        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">54,969,322</FONT>
        </TD>
</TR>
<TR>
        <TD height="17" colspan=5>
          <center>
    </center></TD>
        <TD height="17" colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>

          <center>
    </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<B><FONT size=2 face="serif">Entertainment &amp; Leisure&#151;1.9%</FONT></B>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=left>

        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">B</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">Hammons John Q. Hotels LP, Ser. B, 8.875%, 5/15/12</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">2,300,000</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">Ba3</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">1,271</FONT>
        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">Host Marriot Corp., Ser. B, 7.875%, 8/01/08</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">1,305,953</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">Ba2</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">5,425</FONT>
        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">MGM Mirage, 9.75%, 6/01/07</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">6,103,125</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">BB+</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">3,500</FONT>
        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">Royal Caribbean Cruises Ltd., 8.00%, 5/15/10 (Liberia)</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">3,990,000</FONT>
        </TD>
</TR>
<TR>
        <TD height="17" colspan=5>
          <center>
    </center></TD>
        <TD height="17" colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>

          <center>
    </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>

        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">13,699,078</FONT>
        </TD>
</TR>
<TR>
        <TD height="17" colspan=5>
          <center>
    </center></TD>
        <TD height="17" colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>

          <center>
    </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<B><FONT size=2 face="serif">Financial Institutions&#151;7.6%</FONT></B>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=left>

        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">BB</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">3,000</FONT>
        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">Crum &amp; Forster Holdings Corp., 10.375%, 6/15/13</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">3,210,000</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>

          <center>
    </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">JP Morgan HYDIB,</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=left>

        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">BB</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">10,000</FONT><SUP></SUP>
        </TD>
        <TD width="3%" height="17" align=left><SUP><FONT size=1 face="serif">2,3</FONT></SUP>

        </TD>
        <TD width="70%" height="17" align=left>
  <FONT size=1 face="serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.40%, 6/20/08</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">10,150,000</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">B-</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">9,815 </FONT><SUP></SUP>
        </TD>
        <TD width="3%" height="17" align=left><SUP><FONT size=1 face="serif">2,3</FONT></SUP>

        </TD>
        <TD width="70%" height="17" align=left>
  <FONT size=1 face="serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.00%, 6/20/08</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">10,305,555</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD height="17" align=left>
      <center>
        <FONT size=1 face="serif">Baa2</FONT>
          </center></TD>
        <TD height="17" align=left>&nbsp;</TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">5,000</FONT><SUP></SUP>
        </TD>
        <TD width="3%" height="17" align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">Kazkommerts Intl. BV, 10.125%, 5/08/07 (Netherlands)</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">5,462,500</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=center>
      <center>
        <FONT size=1 face="serif">BBB+</FONT>
          </center></TD>
        <TD width="4%" height="17" align=center>&nbsp;</TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">200</FONT>
        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">Marsh &amp; McLennan Cos, Inc., 2.193%, 7/13/07</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">193,430</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>

          <center>
    </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">Rainbow National Services LLC,</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=left>

        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">B3</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">925</FONT><SUP></SUP>
        </TD>
        <TD width="3%" height="17" align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width="70%" height="17" align=left>
  <FONT size=1 face="serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.75%, 9/01/12</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">989,750</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD height="17" align=left>
      <center>
        <FONT size=1 face="serif">CCC+</FONT>
          </center></TD>
        <TD height="17" align=left>&nbsp;</TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">2,850</FONT><SUP></SUP>
        </TD>
        <TD width="3%" height="17" align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width="70%" height="17" align=left>
  <FONT size=1 face="serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.375%, 9/01/14</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">3,092,250</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">B1</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">4,500</FONT></TD>
        <TD width="3%" height="17" align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">Sheridan Acquisition Corp., 10.25%, 8/15/11</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">4,882,500</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">B+</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">5,000</FONT>
        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">Southern Star Central Corp., 8.50%, 8/01/10</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">5,525,000</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">NR</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">7,888</FONT></TD>
        <TD width="3%" height="17" align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">Structured Asset Receivable Trust, 1.649%, 1/21/10</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">7,876,003</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">BB-</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">4,215</FONT>
        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">Western Financial Bank, 9.625%, 5/15/12</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">4,805,100</FONT>
        </TD>
</TR>
<TR>
        <TD height="17" colspan=5>
          <center>
    </center></TD>
        <TD height="17" colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>

          <center>
    </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>

        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">56,492,088</FONT>
        </TD>
</TR>
<TR>
        <TD height="17" colspan=5>
          <center>
    </center></TD>
        <TD height="17" colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>

          <center>
    </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<B><FONT size=2 face="serif">Health Care&#151;3.6%</FONT></B>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=left>

        </TD>
</TR>
<TR valign="bottom">
        <TD height="17" align=left>
      <center>
        <FONT size=1 face="serif">BBB-</FONT>
          </center></TD>
        <TD height="17" align=left>&nbsp;</TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">5,000</FONT>
        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">Amerisourcebergen Corp., 8.125%, 9/01/08</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">5,487,500</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">B-</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">5,000</FONT><SUP></SUP>
        </TD>
        <TD width="3%" height="17" align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">Concentra Operating Corp., 9.50%, 8/15/10</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">5,537,500</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">B3</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">2,610</FONT>
        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">Insight Health Services Corp., Ser. B, 9.875%, 11/01/11</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">2,610,000</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">B-</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">3,000</FONT>
        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">Norcross Safety Products LLC, 9.875%, 8/15/11</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">3,270,000</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>

          <center>
    </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">Tenet Healthcare Corp.,</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=left>

        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">B-</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">1,875</FONT>
        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
  <FONT size=1 face="serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.375%, 12/01/11</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">1,710,938</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">B-</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">25</FONT>
        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
  <FONT size=1 face="serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.50%, 6/01/12</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">22,688</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">B-</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">3,005</FONT><SUP></SUP>
        </TD>
        <TD width="3%" height="17" align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width="70%" height="17" align=left>
  <FONT size=1 face="serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.875%, 7/01/14</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">3,147,738</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">B</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">4,500</FONT>
        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">United Surgical Partners Intl., Inc., 10.00%, 12/15/11</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">5,163,750</FONT>
        </TD>
</TR>
<TR>
        <TD height="17" colspan=5>
          <center>
    </center></TD>
        <TD height="17" colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>

          <center>
    </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>

        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">26,950,114</FONT>
        </TD>
</TR>
<TR>
        <TD height="17" colspan=5>
          <center>
    </center></TD>
        <TD height="17" colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>

          <center>
    </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<B><FONT size=2 face="serif">Industrials&#151;1.8%</FONT></B>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=left>

        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">B-</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">4,000</FONT><SUP></SUP>
        </TD>
        <TD width="3%" height="17" align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">Fasten Tech, Inc., 11.50%, 5/01/11</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">4,520,000</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">B</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">4,900</FONT>
        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">Hexcel Corp., 9.875%, 10/01/08</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">5,537,000</FONT>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>
      <center>
        <FONT size=1 face="serif">B-</FONT>
          </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=right>
<FONT size=1 face="serif">3,000</FONT>
        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>
<FONT size=1 face="serif">Williams Scotsman, Inc., 9.875%, 6/01/07</FONT>
        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">2,880,000</FONT>
        </TD>
</TR>
<TR>
        <TD height="17" colspan=5>
          <center>
    </center></TD>
        <TD height="17" colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width="10%" height="17" align=left>

          <center>
    </center></TD>
        <TD width="4%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="3%" height="17" align=left>

        </TD>
        <TD width="70%" height="17" align=left>

        </TD>
        <TD width="1%" height="17" align=left>

        </TD>
        <TD width="9%" height="17" align=right>
<FONT size=1 face="serif">12,937,000</FONT>
        </TD>
</TR>
<TR>
        <TD height="17" colspan=5>
          <center>
    </center></TD>
        <TD height="17" colspan=2>
<HR noshade size=1>
        </TD>
</TR>
</TABLE>
<center>
  <BR>
  <FONT size=2 face="serif">See Notes to Financial Statements.</FONT><BR>
</center>
<P align="center">
<FONT size=2 face="serif">38</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT size=2 face="serif">BlackRock Limited Duration Income Trust (BLW) (continued)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=right>&nbsp;
</TD>
        <TD colspan=3 align=right><center>
    <B><FONT size=2 face="serif">Principal</FONT></B>     </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=right>
      <center>
        <B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1 </FONT></SUP></B><B></B>
          </center></TD>
        <TD colspan=3 align=right><center>
    <B><FONT size=2 face="serif">Amount</FONT></B>        </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
      <center>
        <B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
          </center></TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>&nbsp;
          </center></TD>
        <TD width=70% align=center>
<B><FONT size=2 face="serif">Description</FONT></B>&nbsp;
        </TD>
        <TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
          </center></TD>
  </TR>
<TR>
        <TD colspan=7>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Media&#151;6.4%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B1</FONT>&nbsp;
        </TD>
        <TD width=4% align=right>
<FONT size=1 face="serif">$</FONT>
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Alliance Atlantis Communications, Inc., 13.00%, 12/15/09 (Canada)</FONT>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
          </div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,687,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">CBD Media Inc., 8.625%, 6/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,648,750</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Cenveo Corp., 9.625%, 3/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5,575,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">6,685</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Comcast Cable Communications, Inc., 6.875%, 6/15/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">7,478,530</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">6,000</FONT></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">CSC Holdings, Inc., 7.875%, 12/15/07</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">6,450,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,300</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Dex Media East, LLC, 12.125%, 11/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,615,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Echostar DBS Corp., 5.75%, 10/01/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,040,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Houghton Mifflin Co., 9.875%, 2/01/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5,425,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,250</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Nextmedia Operating, Inc., 10.75%, 7/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,656,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B1</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,500</FONT></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Paxson Communications Corp., 4.82%, 1/18/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,515,625</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,650</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Salem Communications Corp., 7.75%, 12/15/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,963,875</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,375</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">WRC Media, Inc., 12.75%, 11/15/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,292,500</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">47,348,280</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Real Estate&#151;1.1%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5,860</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">American Real Estate Partners LP, 8.125%, 6/01/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">6,182,300</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Rouse Co., 5.375%, 11/26/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,903,057</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">8,085,357</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Technology&#151;1.4%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,708</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Amkor Tech. Inc., 7.75%, 5/15/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,342,420</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,972</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Flextronics Intl. Ltd., 6.50%, 5/15/13 (Singapore)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,170,600</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Unisys Corp., 6.875%, 3/15/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,718,750</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">10,231,770</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Telecommunications&#151;4.2%</FONT></B>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">ACC Escrow Corp., Ser. B, 10.00%, 8/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,520,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5,000 </FONT></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Deutsche Telekom Intl. Finance BV, 8.50%, 6/15/10 (Netherlands)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">6,018,050</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">490 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">New Skies Satellites NV, 9.125%, 11/01/12 (Netherlands)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">502,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Nextel Communications, Inc., 7.375%, 8/01/15</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5,562,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,210</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">PanAmSat Corp., 9.00%, 8/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,441,550</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,000</FONT>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Qwest Communications Intl., Inc., 5.211%, 11/15/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,900,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Qwest Corp.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.875%, 9/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,062,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">6,000</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2,3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">9.125%, 3/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">6,765,000</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">30,771,850</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Transportation&#151;0.7%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,650</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Overseas Shipholding Group, Inc., 8.75%, 12/01/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,839,750</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,015</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Sea Containers Ltd., 10.50%, 5/15/12 (Bermuda)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,128,063</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,967,813</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Corporate Bonds</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">430,145,519</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Bank Loans&#151;42.3%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Aero &amp; Defense&#151;0.2%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,475</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Transdigm, Inc., Term Loan, LIBOR + 2.25%, 11/08/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,497,638</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Automotive&#151;1.2%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">498</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">CSK Automotive, Inc., Term Loan C, LIBOR + 2.00%, 12/31/04 - 1/12/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">502,682</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,247</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Dayco Products, LLC, Term Loan B, LIBOR + 3.00%, 12/29/04 - 3/29/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,262,461</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,852</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">EaglePicher Industries, Term Loan B, LIBOR + 3.00%, 11/30/04 - 12/10/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,858,754</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Tenneco Automotive, Inc.</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">445</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Term Loan B, LIBOR + 3.00%, 12/16/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">452,144</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,002</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Term Loan B1, LIBOR + 3.00%, 11/30/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,018,837</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,769</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">TRW Automotive Aquisitions Corp., Term Loan D1, LIBOR + 2.25%, 1/14/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,808,496</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">8,903,374</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Basic Materials&#151;4.7%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Boise, Term Loan, LIBOR + 2.25%, 10/31/10 - 10/31/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,048,594</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Celanese AG,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Term Loan, LIBOR + 2.50%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,046,251</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Term Loan C, LIBOR + 3.50%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,016,170</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Cognis, Term Loan, LIBOR + 4.75%, 11/15/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,101,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,750</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Huntsman Intl LLC, Term Loan B, LIBOR + 3.25%, 11/15/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,778,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Huntsman LLC, Term Loan, LIBOR + 3.50%, 11/22/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,025,000</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD align=center colspan=7>
<FONT size=2 face="serif">See Notes to Financial Statements.</FONT>
        </TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2 face="serif">39</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
  <TD colspan="5" align=left>
<B><FONT size=2 face="serif">BlackRock Limited Duration Income Trust (BLW) (continued)</FONT></B>&nbsp; </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>&nbsp;
          </center> </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left><center>
    <B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>
  </center></TD>
        <TD colspan="3" align=left>       <center>
            <B><FONT size=2 face="serif">Amount</FONT></B>&nbsp;
      </center> </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left><center>
    <B><FONT size=2 face="serif">(unaudited) </FONT></B>
  </center></TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">(000)</FONT></B>&nbsp;
          </center> </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><FONT size=2
face="serif">Description</FONT></B>&nbsp;
        </TD>
        <TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
          </center></TD>
  </TR>
<TR>
        <TD colspan=7>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Basic Materials&#151;(cont&#146;d)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=right>&nbsp;</TD>
        <TD width=4% align=right>
<FONT size=1 face="serif">$</FONT>
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">931</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">INEOS Group Holdings PLC, Term Loan C, LIBOR + 3.50%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
          </div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">943,033</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">MDCP Acquisitions,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,000</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Term Loan B3, LIBOR + 2.75%, 1/10/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,005,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,000</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Term Loan C3, LIBOR + 3.25%, 1/10/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,000,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,497</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Nalco Chemical Co., Term Loan B, LIBOR + 2.50%, 11/23/04 - 1/24/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,539,597</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,274</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">RLC Industries Co., Term Loan B, LIBOR + 2.00%, 11/30/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,279,244</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Rockwood Specialties Group, Inc.</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,926</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Term Loan LIBOR + 8.00%, 11/26/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,925,864</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Term Loan B LIBOR + 2.50%, 1/27/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,009,531</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">487</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">SGL Carbon LLC, Term Loan, LIBOR + 3.00%, 11/30/04 - 2/09/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">489,419</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">SP Newsprint Co., Term Loan B,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,611</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">LIBOR, 11/15/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,631,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">870</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">LIBOR + 3.00%, 11/26/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">881,016</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">988</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">USI Holdings Corp., Term Loan B, LIBOR + 2.50%, 1/31/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">991,820</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">34,711,039</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Building &amp; Development&#151;0.9%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Associated Materials, Inc., Term Loan,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,474</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">LIBOR + 2.75%, 11/12/04 - 3/14/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,329,770</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,547</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">PRIME + 1.75%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">159,572</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">995</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Builders Firstsource, Inc., Term Loan A, LIBOR + 3.00%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,001,219</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">830</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Goodman Global Holdings, Inc., Term Loan B, LIBOR + 2.00%, 12/31/04 - 1/31/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">836,225</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Landsource Communities Development, LLC, Term Loan B, LIBOR + 2.50%, 11/26/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,015,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Nortek, Inc., Term Loan,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>

        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">500</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">LIBOR + 2.75%, 8/24/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">470,670</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,985</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">PRIME + 1.50%, 1/06/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">36,205</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Ply Gem Industries, Inc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">75</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">CAD Term Loan, LIBOR + 2.50%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">75,467</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,423</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Term Loan, LIBOR + 2.50%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,436,397</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">500</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Term Loan B, LIBOR + 2.50%, 3/31/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">504,375</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">6,864,900</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Conglomerates&#151;2.4%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Colfax Corp.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,625</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Term Loan B, LIBOR + 3.00%, 11/01/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,634,062</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,250</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Term Loan C, LIBOR + 6.25%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,260,938</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,496</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Honeywell Security Group, Term Loan B, LIBOR + 4.00%, 12/06/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,496,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Invesys Intl. Holdings Ltd.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,250</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Term Loan, LIBOR + 4.75%, 1/07/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,372,188</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,977</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Term Loan B1, LIBOR + 3.50%, 1/07/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,001,872</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">746</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Precise Technology, Inc., Term Loan, LIBOR + 3.00%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">749,048</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,475</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Quintiles Transnational Corp., Term Loan B, LIBOR + 4.25%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,499,750</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,980</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Trimas Corp., Term Loan B, LIBOR + 3.50%, 12/31/04 - 1/13/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,994,611</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">18,008,719</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Consumer Products&#151;6.6%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,063</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Alimentation Couche Tard, Inc., Term Loan, LIBOR + 1.75%, 11/18/04 - 11/30/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,074,027</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">500</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Buffets, Inc., Term Loan LC, LIBOR + 3.6%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">500,834</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,344</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">CKE Restaurants, Term Loan, LIBOR + 3.00%, 11/08/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,371,226</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">499</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Coinstar, Inc., Term Loan, LIBOR + 2.25%, 12/31/04 - 1/07/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">506,231</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Denny&#146;s Corp., Term Loan, LIBOR, 11/22/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,021,875</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">987</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Dole Food Co., Inc., Term Loan D, LIBOR + 2.25%, 11/12/04 - 1/03/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">999,640</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,186</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Dr. Pepper Bottling Co. of Texas, Term Loan B, LIBOR + 2.25%, 11/22/04 - 4/22/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,226,701</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">869</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">DS Waters Enterprises LP, Term Loan, LIBOR + 2.75%, 12/31/04 - 3/30/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">843,137</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">500</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Harbor Freight Tools, Term Loan B, LIBOR + 2.75%, 11/16/04 - 11/17/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">503,750</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,980</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Jarden Corp., Term Loan B, LIBOR + 2.25%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,981,238</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">983</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Keystone Foods Holdings, LLC, Term Loan, LIBOR + 2.50%, 11/29/04 - 3/31/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">991,817</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Knoll, Inc., Term Loan, LIBOR + 3.00%, 11/05/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,011,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,750</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">KOSA B.V., Term Loan B1, LIBOR + 2.75%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,798,125</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">987</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Language Line, Inc., Term Loan B, LIBOR + 4.25%, 11/22/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">996,094</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,670</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Le Nature, Inc., Term Loan B, LIBOR + 4.00%, 11/26/04 - 2/25/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,688,968</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,504</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Meow Mix Co., Term Loan, LIBOR + 4.25%, 12/26/04 - 1/03/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,466,395</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD align=center colspan=7>
<FONT size=2 face="serif">See Notes to Financial Statements.</FONT>
        </TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2 face="serif">40</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
  <TD colspan="5" align=left>
<B><FONT size=2 face="serif">BlackRock Limited Duration Income Trust (BLW) (continued)</FONT></B>&nbsp; </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>&nbsp;
          </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left><center>
    <B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>
  </center></TD>
        <TD colspan="3" align=left>     <center>
          <B><FONT size=2 face="serif">Amount</FONT></B>&nbsp;
    </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left><center>
    <B><FONT size=2 face="serif">(unaudited)</FONT></B>
  </center></TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif"> (000)</FONT></B>&nbsp;
          </center></TD>
        <TD width=70% align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><FONT size=2
face="serif">Description</FONT></B>&nbsp;
        </TD>
        <TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
          </center></TD>
  </TR>
<TR>
        <TD colspan=7>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Consumer Products&#151;(cont&#146;d)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=right>&nbsp;</TD>
        <TD width=4% align=right>
<FONT size=1 face="serif">$</FONT>
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,978</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Michael Foods, Inc., Term Loan, LIBOR + 2.25%, 11/22/04 - 11/26/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
          </div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,014,719</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Nice Pak Products, Inc., Term Loan, LIBOR + 3.50%, 12/31/04 - 3/10/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,010,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Olympus Cable Holdings, LLC,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2.000</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Term Loan A, Prime + 1.25%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,958,750</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,500</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Term Loan B, Prime + 2.00%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,442,033</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,781</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Oriental Trading Co., Inc., Term Loan B, LIBOR + 2.75%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,810,145</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">OSI Group LLC, Term Loan B, LIBOR + 2.50%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,035,625</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,838</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Pantry, Inc., The, Term Loan B, LIBOR + 2.25%, 11/30/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,862,949</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">998</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Pierre Foods, Inc., Term Loan B, LIBOR + 2.75%, 12/03/04 - 3/04/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,003,733</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,493</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Prestige Brands Holdings, Inc., Term Loan B, LIBOR, 12/31/04 - 1/26/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,503,070</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,990</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">R.H. Donnelley, Inc., Term Loan B2, LIBOR, 12/03/04 - 1/10/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,046,110</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">875</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Sealy Mattress Co., Term Loan C, LIBOR + 2.25%, 11/05/04 - 12/01/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">886,301</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,209</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Tempur Pedic, Inc., Term Loan B, LIBOR + 2.25%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,227,427</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">48,782,170</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Containers &amp; Glass&#151;2.5%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">956</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Bway Corp., Term Loan, LIBOR, 11/12/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">968,097</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Graham Packaging Co., Inc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Term Loan B, LIBOR, 12/31/04 - 1/08/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,027,188</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Term Loan C, PRIME + 3.25%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,044,584</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,488</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Graphic Packaging Intl., Inc., Term Loan C, LIBOR + 2.50%, 11/30/04 - 1/04/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,512,985</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Owens-Illinois Group, Inc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,916</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Term Loan A, LIBOR + 2.75%, 11/02/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,985,929</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">667</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Term Loan C1, LIBOR + 2.75%, 11/26/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">677,150</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,970</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Silgan Holdings, Inc., Term Loan B, PRIME + 0.75%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,999,624</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">568</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Smurfit Stone Container Corp., Term Loan, LIBOR + 2.00%, 11/15/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">567,645</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">488</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Sola International, Inc., Term Loan, LIBOR + 3.00%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">492,984</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,990</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Solo Cup, Inc., Term Loan, LIBOR + 2.50%, 11/01/04 - 12/30/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,009,070</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">18,285,256</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Ecological Services &amp; Equipment&#151;0.9%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Allied Waste NA, Inc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,916</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Term Loan A, LIBOR + 2.75%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">999,281</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">667</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Term Loan C, LIBOR + 2.75%, 12/15/04 - 12/15/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,969,629</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Envirosolutions, Inc., Term Loan,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,273</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">LIBOR + 2.00%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">55,316</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">684</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">LIBOR + 4.50%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,939,684</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">6,963,910</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Energy&#151;2.9%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">429</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">AES Corp., The, Term Loan, LIBOR + 2.25%, 11/02/04 - 2/02/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">434,866</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,975</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Calpine Corp., Term Loan, LIBOR + 5.75%, 1/18/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,654,063</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">6,924</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Centerpoint Energy, Inc., Term Loan, LIBOR + 3.50%, 11/08/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">6,941,635</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,967</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Getty Petroleum Marketing, Inc., Term Loan, LIBOR + 3.25%, 12/30/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,994,938</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">La Grange Acquisition, LP, Term Loan, LIBOR + 3.00%, 11/29/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,028,750</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,375</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Mission Energy Holdings Co., Term Loan, LIBOR + 5.00%, 12/10/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,377,149</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">NRG Energy, Inc., Term Loan,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">932</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.00%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">214,479</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">576</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">LIBOR + 4.00%, 12/23/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">378,578</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">489</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Pike Electric, Inc., Term Loan B, LIBOR + 2.25%, 11/04/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">497,098</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5,639</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Reliant Resources, Inc., Term Loan, LIBOR + 4.00%, 11/08/04 - 1/08/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5,721,234</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">21,242,790</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Entertainment &amp; Leisure&#151;1.2%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">998</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Boyd Gaming Corp., Term Loan B, LIBOR + 1.75%, 12/31/04 - 3/31/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,009,221</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,977</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Greektown Casino, LLC, Term Loan D, LIBOR + 3.50%, 11/01/04 - 11/04/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,924,989</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">496</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Green Valley Ranch Gaming, LLC, Term Loan B, LIBOR, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">502,453</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Loews Cineplex Entertainment Corp., Term Loan B, LIBOR + 2.25%, 11/04/04 - 11/08/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,011,875</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Marina District Finance Co., Inc., Term Loan B, LIBOR + 4.50%, 3/31/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,012,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,239</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Wyndham Intl., Inc., Term Loan II, LIBOR + 5.75%, 11/10/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,240,811</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">8,701,849</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD align=center colspan=7>
<FONT size=2 face="serif">See Notes to Financial Statements.</FONT>
        </TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2 face="serif">41</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
  <TD colspan="5" align=left>
<B><FONT size=2 face="serif">BlackRock Limited Duration Income Trust (BLW) (continued)</FONT></B>&nbsp; </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD colspan="3">
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>&nbsp;
          </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left><center>
    <B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>
  </center></TD>
        <TD colspan="3">        <center>
          <B><FONT size=2 face="serif">Amount</FONT></B>&nbsp;
    </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left><center>
    <B><FONT size=2 face="serif">(unaudited)</FONT></B>
  </center></TD>
        <TD colspan="3">
      <center>
        <B><FONT size=2 face="serif"> (000)</FONT></B>&nbsp;
          </center></TD>
        <TD width=70% align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><FONT size=2
face="serif">Description</FONT></B>&nbsp;
        </TD>
        <TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
          </center></TD>
  </TR>
<TR>
        <TD colspan=7>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Financial Institutions&#151;1.1%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=right>&nbsp;</TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">958</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">CCC Information Services, Inc., Term Loan, LIBOR + 3.00%, 11/29/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
          </div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">960,459</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">998</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Conseco, Inc., Term Loan, LIBOR + 3.50%, 11/26/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,015,787</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,950</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Global Cash Access, LLC, Term Loan, LIBOR + 2.75%, 11/30/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,981,688</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,500</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Jostens, Inc., Term Loan B, LIBOR + 2.50%, 12/30/04 - 1/08/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,521,563</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,995</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">SBA Senior Finance, Inc., Term Loan, LIBOR + 3.50%, 12/30/04 - 3/31/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,008,716</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">488</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Universal American Financial Corp., Term Loan, LIBOR + 2.25%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">487,500</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">7,975,713</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Health Care&#151;3.5%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,995</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Accredo Health, Inc., Term Loan B, LIBOR + 1.75%, 11/30/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,009,975</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">211</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Ameripath, Inc., Term Loan, LIBOR + 3.00%, 11/26/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">211,662</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">744</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Atrium Companies, Inc., Term Loan, LIBOR + 2.75%, 12/20/04 - 1/18/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">754,921</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,251</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Colgate Medical, Ltd., Term Loan B, LIBOR, 12/29/04 - 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,258,956</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Community Health Systems, Inc., Term Loan, LIBOR + 1.75%, 11/30/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,008,037</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,743</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Concentra Operating Corp., Term Loan, LIBOR + 2.50%, 11/26/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,767,127</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,700</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Connecticare, Inc., Term Loan, LIBOR + 3.75%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,706,750</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,960</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Davita, Inc., Term Loan B, LIBOR + 2.00%, 11/23/04 - 3/30/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,993,818</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">481</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">DJ Orthopedics, LLC, Term Loan, LIBOR + 2.25%, 12/31/04 - 4/29/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">485,461</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">499</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Fisher Scientific Intl., Inc., Term Loan B, LIBOR + 1.50%, 11/29/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">502,335</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">998</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">IASIS Healthcare Corp., Term Loan B, LIBOR + 2.50%, 12/31/04 - 1/04/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,010,176</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Jean Coutu Group, Inc., Term Loan B, LIBOR + 2.25%, 11/30/04 - 1/31/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,044,658</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,297</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Kinetic Concepts, Inc., Term Loan B1, LIBOR + 2.00%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,322,869</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">499</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Medical Device Manufacturing, Inc., Term Loan, LIBOR + 3.00%, 11/30/04 - 1/31/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">501,244</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">998</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Wellcare Holdings, Inc., Term Loan, LIBOR + 4.00%, 11/15/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">997,500</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">25,575,489</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Industrials&#151;2.6%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">373</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Alderwoods Group, Inc., Term Loan B1, LIBOR + 2.75%, 11/19/04 - 3/28/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">378,605</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">995</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Arinc, Inc., Term Loan B, LIBOR + 2.25%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,004,950</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Buhrmann U.S., Inc., Term Loan C1, LIBOR + 2.50%, 12/07/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,269,689</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Exide Technologies, Term Loan, LIBOR + 3.50%, 11/22/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,996,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">952</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Ionics, Inc., Term Loan, LIBOR + 2.75%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">962,304</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">New Flyer, Inc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">381</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Term Loan, LIBOR + 2.75%, 1/01/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">386,190</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,208</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Term Loan B, LIBOR + 2.75%, 11/30/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,222,008</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,887</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Roper Industries, Inc., Term Loan, LIBOR + 2.00%, 12/31/04 - 1/28/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,887,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,477</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Sensus Metering Systems, Inc., Term Loan B1, LIBOR + 2.50%, 1/20/05 - 2/22/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,487,965</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,824</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">United Rentals NA, Inc., Term Loan B, LIBOR + 2.25%, 11/29/04 - 11/30/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,842,864</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,888</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Williams Scotsman, Inc., Term Loan, LIBOR + 3.00%, 11/12/04 - 1/06/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,906,465</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">702</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Worldspan, LP, Term Loan, LIBOR + 3.75%, 12/31/04 - 1/10/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">704,045</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">19,048,835</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Media&#151;6.6%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">499</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Adams Outdoor Advertising, LP, Term Loan, LIBOR + 2.25%, 12/20/04 - 1/20/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">504,569</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,376</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Dex Media East, LLC, Term Loan A, LIBOR + 2.00%, 11/08/04 - 11/30/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,399,290</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Dex Media West, LLC,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,317</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Term Loan A, LIBOR + 2.50%, 11/08/04 - 11/30/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,292,010</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,234</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Term Loan B, LIBOR + 2.25%, 11/08/04 - 11/30/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,962,223</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,717</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">DirecTV Holdings, LLC, Term Loan B2, LIBOR + 2.00%, 11/15/04 - 12/13/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,765,878</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,500</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Echostar DBS Corp., Term Loan, LIBOR + 2.25%, 1/04/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,680,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Emmis Operating Co., Term Loan B, LIBOR, 11/08/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,025,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,750</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Freedom Communications, Inc., Term Loan, LIBOR, 11/29/04 - 12/01/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,775,813</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">970</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Insight Midwest Holdings LLC, Term Loan, LIBOR + 2.75%, 12/07/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">6,033,840</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,111</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Lions Gate Entertainment, Inc., Term Loan, LIBOR + 3.25%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,116,667</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,990</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Mediacom Communications Corp., Term Loan B, LIBOR + 2.50%, 11/05/04 - 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,023,915</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Mediacom Illinois LLC, Term Loan B, LIBOR + 2.25%, 11/19/04 - 4/22/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,005,714</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">4,000</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">MGM Studios, Inc., Term Loan B, LIBOR + 2.50%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,011,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">645</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Mission Broadcasting, Inc., Term Loan D, LIBOR + 1.75%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">644,385</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">352</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Nexstar Broadcasting, Inc., Term Loan D, LIBOR + 1.75%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">352,749</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,000</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">NTL Investment Holding Ltd., Term Loan B, LIBOR + 3.00%, 4/14/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,024,999</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,500</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Raycom Media, Inc., Term Loan B, LIBOR + 1.75%, 11/08/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,509,375</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,539</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Relizon Company, The, Term Loan, LIBOR + 3.00%, 11/19/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,544,865</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,990</FONT>&nbsp;
        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Warner Music Group, Term Loan B, LIBOR, 11/24/04 - 4/22/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,015,942</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
  <TD width=10% align=left></TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">48,688,734</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD align=center colspan=7>
<FONT size=2 face="serif">See Notes to Financial Statements.</FONT>
        </TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2 face="serif">42</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT size=2 face="serif">BlackRock Limited Duration Income Trust (BLW) (continued)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=right>&nbsp;
</TD>
        <TD colspan=3 align=right><center>
    <B><FONT size=2 face="serif">Principal</FONT></B>     </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=right>
      <center>
        <B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>
          </center></TD>
        <TD colspan=3 align=right><center>
    <B><SUP><FONT size=2 face="serif"> </FONT></SUP></B><B><FONT size=2 face="serif">Amount</FONT></B>    </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
      <center>
        <B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
          </center></TD>
        <TD colspan="3">
      <center>
        <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>&nbsp;
          </center></TD>
        <TD width=70% align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><FONT size=2
face="serif">Description</FONT></B>&nbsp;
        </TD>
        <TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
          </center></TD>
  </TR>
<TR>
        <TD colspan=7>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Real Estate&#151;0.2%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=right>&nbsp;
        </TD>
        <TD width=4%><div align="right"><FONT size=1 face="serif">$</FONT>
    </div></TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,455</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Crescent Real Estate Equities LP, Term Loan, LIBOR + 2.25%, 11/01/04 - 11/15/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
          </div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,464,507</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Technology&#151;0.7%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,235</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Knowles Electronics, Inc., Term Loan B2, LIBOR + 5.00%, 4/04/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,269,867</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">499</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Network Communications, Inc., Term Loan B, LIBOR + 4.00%, 11/02/04 - 11/30/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">504,049</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,496</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Verifone, Inc., Term Loan B, LIBOR + 2.50%, 1/31/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,516,823</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5,290,739</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Telecommunications&#151;3.5%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Atlantic Broadband Finance, LLC, Term Loan B, LIBOR + 3.25%, 12/07/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,014,583</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,495</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Centennial Cellular Operating Co., Term Loan B, LIBOR + 2.75%, 11/30/04 - 3/31/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,512,352</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,491</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Charter Communications Operating, LLC, Term Loan B, LIBOR + 3.25%, 12/31/04 - 1/31/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,461,372</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,495</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Consolidated Communications, Inc., Term Loan B, LIBOR + 2.75%, 11/16/04 - 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,506,213</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">FairPoint Communications, Inc., Term Loan, TBD, 5/18/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,015,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,970</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Nextel Finance Co., Term Loan E, LIBOR + 2.25%, 12/17/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,980,751</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Nextel Partners Operating Corp., Term Loan C, LIBOR + 2.50%, 12/01/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,537,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Qwest Corp., Term Loan A, LIBOR + 4.75%, 12/09/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5,190,180</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,649</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Valor Telecommunication Enterprises II, LLC, Term Loan A, LIBOR + 2.50%, 11/10/04 - 11/12/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,645,153</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,990</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Western Wireless Corp., Term Loan B, LIBOR + 3.00%, 11/05/04 - 1/28/05</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,048,426</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">25,911,530</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Transportation&#151;0.6%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">998</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Kenan Advantage Group, Inc., Term Loan, LIBOR + 3.50%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,006,228</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,953</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Sirva Worldwide, Inc., Term Loan, LIBOR + 2.50%, 11/08/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,965,147</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">725</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Transport Industries, LP, Term Loan B, LIBOR + 4.00%, 12/31/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">725,148</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">998</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Transwestern Pipeline Co., Term Loan B, LIBOR + 2.25%, 11/08/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,001,657</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,698,180</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Bank Loans</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">312,615,372</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Mortgage Pass-Through Securities&#151;22.3%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal National Mortgage Assoc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5,714</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.423%, 11/01/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5,853,736</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD colspan=3 align=right>
<FONT size=1 face="serif">121,700</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.00%, TBA</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">124,171,970</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">17,000</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.25%, 1/15/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">19,807,380</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">14,802</FONT></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.50%, 12/01/28 - 11/01/33</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">15,101,478</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Mortgage Pass-Through Securities</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">164,934,564</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Interest Only Asset-Backed Securities&#151;1.5%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Sterling Coofs Trust,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">73,778</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 1, 4/15/29</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">6,552,424</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">54,298</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 2, 3/30/30</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,326,850</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Interest Only Asset-Backed Securities</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">10,879,274</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Interest Only Mortgage-Backed Securities&#151;0.5%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">17,301</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal National Mortgage Assoc., Ser. 64, Class QI, 1/25/33</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,342,528</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Commercial Mortgage-Backed Securities&#151;0.1%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Bear Stearns Commercial Mortgage Secs., Inc., Class K, 4.368%, 11/15/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">994,900</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Asset-Backed Securities&#151;1.9%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">6,900</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">DaimlerChrysler Auto Trust, Ser. B, Class A3, 2.25%, 11/01/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">6,877,309</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">7,125</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Honda Auto Receivables, Class A3, 2.30%, 10/18/07</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">7,097,742</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Asset-Backed Securities</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">13,975,051</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
</TABLE>
<center>
  <BR>
  <FONT size=2 face="serif">See Notes to Financial Statements.</FONT><BR>
</center>
<P align="center">
<FONT size=2 face="serif">43</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT size=2 face="serif">BlackRock Limited Duration Income Trust (BLW) (continued)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=8>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; </TD>
        <TD colspan=3 align=left><center>
    <B><FONT size=2 face="serif">Principal</FONT></B>     </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B></TD>
        <TD colspan=3 align=center><center>
    <B><FONT size=2 face="serif">Amount</FONT></B>        </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
        </TD>
        <TD colspan="3">
      <center>
        <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>&nbsp;
          </center></TD>
        <TD width=70% align=center>
<B><FONT size=2 face="serif">Description</FONT></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>

          <center>
      <B><FONT size=2 face="serif">Value</FONT></B>         </center></TD>
  </TR>
<TR>
        <TD colspan=8>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Collateralized Mortgage Obligations&#151;2.4%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">GSR Mortgage Loan Trust,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=right>&nbsp;
        </TD>
        <TD width=4%><div align="right"><FONT size=1 face="serif">$</FONT>
    </div></TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">8,948</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 10, Class 2A1, 10/25/33</FONT>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
          </div></TD>
        <TD align=right>
<FONT size=1 face="serif">8,806,248</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">8,834</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">Ser. 13, Class 1A1, 10/25/33</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">8,780,718</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Collateralized Mortgage Obligations</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">17,586,966</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Foreign Government Bonds&#151;2.5%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">NR</FONT>&nbsp;
        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,667</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Bolivarian Republic of Venezuela, 2.75%, 12/20/04</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">1,658,272</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Republic of Colombia, 9.75%, 4/23/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">5,662,500</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5,000</FONT>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Republic of Peru, 9.125%, 2/21/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">5,600,000</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB-</FONT>&nbsp;
        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">5,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Republic of Turkey, 11.375%, 11/27/06</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">5,650,000</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Foreign Government Bonds</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">18,570,772</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">U.S. Government Securities&#151;4.9%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">765</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">U.S. Treasury Bond, 5.25%, 11/15/28</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">806,692</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">U.S. Treasury Notes,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">17,000 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">3.375%, 12/15/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">17,172,720</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,425 </FONT></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">3.375%, 9/15/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">3,438,906</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">6,000 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">3.875%, 5/15/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">6,167,820</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">8,660</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.25%, 11/15/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">8,838,656</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total U.S. Government Securities</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">36,424,794</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD width="10%">
        </TD>
        <TD width="4%">
        </TD>
        <TD colspan=2>&nbsp;
        </TD>
        <TD width="70%">
        </TD>
        <TD colspan=3>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR>
        <TD>&nbsp;

        </TD>
    <TD colspan=3><HR width="50" size=1 noshade></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan="3">
      <center>
        <B><FONT size=2 face="serif">Units</FONT></B>
          </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD width="10%">
        </TD>
        <TD colspan="3">
      <HR width="50" size=1 noshade>
        </TD>
        <TD colspan=4>
        </TD>
</TR>
<TR>
        <TD colspan=8>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Warrants&#151;0.0%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">10</FONT></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">4</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Reliant Resources, Inc., Expires 8/25/08, Strike price $.001, 1 share for 1 warrant</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">0</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=1 face="serif">Total Long-Term Investments </FONT></B><FONT size=1 face="serif">(cost $977,574,292)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">1,009,469,740</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD width="10%">
        </TD>
        <TD width="4%">
        </TD>
        <TD colspan=2>&nbsp;
        </TD>
        <TD>
        </TD>
        <TD colspan=3><HR align="left" size=1 noshade></TD>
  </TR>
<TR>
        <TD>&nbsp;

        </TD>
    <TD colspan=3><HR width="50" size=1 noshade></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan="3">
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>
          </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan="3">
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>
          </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan="3">
      <center>
        <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>&nbsp;
          </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD width="10%">
        </TD>
        <TD colspan="3">
      <HR width="50" size=1 noshade>
        </TD>
        <TD colspan=4>
        </TD>
</TR>
<TR>
        <TD colspan=8>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">SHORT-TERM INVESTMENT&#151;0.0%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">U.S. Government and Agency Zero Coupon Bond&#151;0.0%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">200</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Federal Home Loan Bank, zero coupon, 11/01/04 (cost $200,000)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">200,000</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=1 face="serif">Total investments&#151;136.6% </FONT></B><FONT size=1 face="serif">(cost $977,774,292)</FONT>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
          </div></TD>
        <TD align=right>
<FONT size=1 face="serif">1,009,669,740</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Liabilities in excess of other assets&#151;(36.6)%</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
      <FONT size=1 face="serif">(270,444,346</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR>
  <TD colspan=5></TD>
  <TD colspan=3><HR align="left" size=1 noshade>
  </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4%>&nbsp;
        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=1 face="serif">Net Assets&#151;100%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
          </div></TD>
        <TD align=right>
      <FONT size=1 face="serif">739,225,394</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR align="left" size=3 noshade>
        </TD>
</TR>
</TABLE>
<BR>
<TABLE border=0 cellspacing=0 cellpadding=0>
<TR>
  <TD colspan="2" valign=top nowrap><hr align="left" width="100" size="1" noshade></TD>
  </TR>
<TR valign="top">
        <TD nowrap>
<SUP><FONT size=1 face="serif">1</FONT></SUP>&nbsp; &nbsp; &nbsp;       </TD>
        <TD>
<FONT size=1 face="serif">Using the higher of S&amp;P&#146;s, Moody&#146;s or Fitch&#146;s rating.</FONT>       </TD>
</TR>
<TR valign="top"><TD colspan=2>&nbsp;</TD></TR><TR valign="top">
        <TD nowrap>
<SUP><FONT size=1 face="serif">2</FONT></SUP>&nbsp; &nbsp; &nbsp;       </TD>
        <TD>
<FONT size=1 face="serif">Entire or partial principal amount pledged as collateral for reverse repurchase agreements or financial futures contracts.</FONT>     </TD>
</TR>
<TR valign="top"><TD colspan=2>&nbsp;</TD></TR><TR valign="top">
        <TD nowrap>
<SUP><FONT size=1 face="serif">3</FONT></SUP>&nbsp;</TD>
        <TD>
<FONT size=1 face="serif">Security is not registered under the Securities Act of 1933. These securities may be resold in transactions in accordance with Rule 144A under that Act, to qualified institutional buyers. As of October 31, 2004, the Trust
held 13.1% of its net assets, with a current market value of $96,625,104, in securities restricted as to resale.</FONT></TD>
</TR>
<TR valign="top"><TD colspan=2>&nbsp;</TD></TR><TR valign="top">
        <TD nowrap>
<SUP><FONT size=1 face="serif">4</FONT></SUP>&nbsp; &nbsp; &nbsp;       </TD>
        <TD>
<FONT size=1 face="serif">Illiquid security.</FONT>     </TD>
</TR>
<TR><TD colspan=2>&nbsp;</TD></TR></TABLE>
<P>
<FONT size=1 face="serif">Details of open reverse repurchase agreements are disclosed in Note 4 in the Notes to Financial Statements.</FONT></P>
<P>
<FONT size=1 face="serif">A category in the Corporate Bonds and Bank Loans sections may contain multiple industries as defined by the SEC&#146;s Standard Industry Codes.</FONT></P>
<center>
  <FONT size=2 face="serif">See Notes to Financial Statements.</FONT><BR>
</center>
<P align="center">
<FONT size=2 face="serif">44</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT face="serif">PORTFOLIO OF INVESTMENTS</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT face="serif">OCTOBER 31, 2004</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD colspan=5 align=left>
 &nbsp;<B><FONT size=2 face="serif">BlackRock Strategic Bond Trust (BHD)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>
          </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>
          </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>&nbsp;
          </center></TD>
        <TD width=70% align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><FONT size=2
face="serif">Description</FONT></B>&nbsp;
        </TD>
        <TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
          </center></TD>
  </TR>
<TR>
        <TD colspan=7>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">LONG-TERM INVESTMENTS&#151;112.3%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Corporate Bonds&#151;106.5%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Aero &amp; Defense&#151;4.7%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=right>
<FONT size=1 face="serif">$</FONT>
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">BE Aerospace, Inc., 9.50%, 11/01/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
          </div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,062,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Lockheed Martin Corp., 8.20%, 12/01/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,192,530</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">650</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Raytheon Co., 4.85%, 1/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">669,038</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">United Technologies Corp., 6.35%, 3/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,125,080</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5,049,148</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Automotive&#151;11.1%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B2</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Collins &amp; Aikman Products Co., 10.75%, 12/31/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,000,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">DaimlerChrysler NA Holding Corp., 7.30%, 1/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,145,910</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Dana Corp., 10.125%, 3/15/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,255,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Delco Remy Intl., Inc., 11.00%, 5/01/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,050,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Ford Motor Credit Co.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">750</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.80%, 1/12/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">771,840</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.875%, 2/01/06</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,082,480</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">General Motors Acceptance Corp.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Baa1</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">250</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.75%, 1/15/06</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">259,315</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Baa1</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">900</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.875%, 9/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">935,442</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Baa1</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">300</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">8.00%, 11/01/31</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">309,750</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">892</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">TRW Automotive, Inc., 9.375%, 2/15/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,025,800</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">11,835,537</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Basic Materials&#151;6.7%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Caraustar Industries, Inc., 9.875%, 4/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,175,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B2</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">195</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Gold Kist, Inc., 10.25%, 3/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">220,350</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">JSG Funding PLC, 9.625%, 10/01/12 (Ireland)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,710,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,800</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Lyondell Chemical Co., 9.50%, 12/15/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,957,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Weyerhaeuser Co., 6.125%, 3/15/07</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,068,810</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">7,131,660</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Building &amp; Development&#151;3.1%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Beazer Homes USA, Inc., 8.625%, 5/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,095,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Schuler Homes, Inc., 9.375%, 7/15/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,165,000</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,260,000</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Conglomerates&#151;2.4%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">325</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Honeywell Intl., Inc., 7.50%, 3/01/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">380,354</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Trimas Corp., 9.875%, 6/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,030,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,132</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Tyco Intl. Group SA, 6.375%, 2/15/06 (Luxembourg)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,181,876</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,592,230</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Consumer Products&#151;5.6%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Autonation, Inc., 9.00%, 8/01/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,305,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">General Mills, Inc., 5.125%, 2/15/07</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,042,400</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">575</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Kellogg Co., Ser. B, 6.00%, 4/01/06</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">600,513</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Pantry, Inc., The, 7.75%, 2/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">523,750</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,400</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Sonic Automotive, Inc., Ser. B, 8.625%, 8/15/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,477,000</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">5,948,663</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Containers &amp; Glass&#151;1.1%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Crown European Holdings SA, 10.875%, 3/01/13 (France)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,190,000</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Ecological Services &amp; Equipment&#151;2.7%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,129</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Allied Waste NA, Inc., Ser. B, 10.00%, 8/01/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,179,805</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Casella Waste Systems, Inc., 9.75%, 2/01/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,665,000</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,844,805</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD align=center colspan=7>
<FONT size=2 face="serif">See Notes to Financial Statements.</FONT>
        </TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2 face="serif">45</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT size=2 face="serif">BlackRock Strategic Bond Trust (BHD) (continued)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan="3" align=left>      <center>
          <B><FONT size=2 face="serif">Principal</FONT></B>
    </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>
          </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>&nbsp;
          </center></TD>
        <TD width=70% align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><FONT size=2
face="serif">Description</FONT></B>&nbsp;
        </TD>
        <TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
          </center></TD>
  </TR>
<TR>
        <TD colspan=7>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Energy&#151;14.3%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=right>
<FONT size=1 face="serif">$</FONT>
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">750 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Calpine Corp., 9.625%, 9/30/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
          </div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">712,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Compagnie Generale de Geophysique SA, 10.625%, 11/15/07 (France)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,116,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">ConocoPhillips Holding Co., 6.95%, 4/15/29</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,173,810</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Dresser, Inc., 9.375%, 4/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,230,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">250</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">DTE Energy Co., 7.05%, 6/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">285,460</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,125 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Dynegy Holdings, Inc., 10.125%, 7/15/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,310,625</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">El Paso Corp.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">165</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.75%, 1/15/32</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">151,800</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">85</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.80%, 8/01/31</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">77,988</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,750</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">El Paso Production Holding Co., 7.75%, 6/01/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,828,750</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">105</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Exelon Corp., 6.75%, 5/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">117,855</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">325</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">FirstEnergy Corp., Ser. C, 7.375%, 11/15/31</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">370,308</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Hanover Equipment Trust, Ser. A, 8.50%, 9/01/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,155,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B1</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Midwest Generation LLC, 8.75%, 5/01/34</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,137,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">250</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Occidental Petroleum Corp., 6.75%, 1/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">285,380</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Baa2</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Progress Energy, Inc., 6.75%, 3/01/06</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,049,070</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">200</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Reliant Energy, Inc., 9.25%, 7/15/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">220,000</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">15,222,046</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Entertainment &amp; Leisure&#151;2.8%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Resorts Intl. Hotel &amp; Casino, Inc., 11.50%, 3/15/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,152,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Royal Caribbean Cruises Ltd., 8.75%, 2/02/11 (Liberia)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,785,000</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,937,500</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Financial Institutions&#151;17.9%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">185 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Allstate Financial Global Funding LLC, 5.25%, 2/01/07</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">193,826</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Aa3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Bank One Corp., 6.50%, 2/01/06</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,047,280</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Aa3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">650 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Barclays Bank PLC, 8.55%, 9/29/49 (United Kingdom)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">800,506</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">325</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Bear Stearns Co., Inc., 6.50%, 5/01/06</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">342,479</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B1</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Bluewater Finance Ltd., 10.25%, 2/15/12 (United Kingdom)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,210,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AA+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">3,000 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Citigroup, Inc., 5.75%, 5/10/06</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,133,920</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Crum &amp; Forster Holdings Corp., 10.375%, 6/15/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">535,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000 </FONT></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">General Electric Cap. Corp., 3.45%, 7/16/07</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,013,680</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,500 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">HSBC Bank USA, Inc., 3.875%, 9/15/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,506,015</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">850</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">KFW Intl. Finance, Inc., 5.25%, 6/28/06</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">885,334</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">325</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">MetLife, Inc., 6.125%, 12/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">355,024</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Rainbow National Services LLC,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">210</FONT></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">8.75%, 9/01/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">224,700</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,650</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">10.375%, 9/01/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,790,250</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">NR</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,020</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Structured Asset Receivable Trust, 1.61%, 1/21/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,018,663</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT></TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">TIAA Global Markets, Inc., 3.875%, 1/22/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,016,200</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Aa1</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Wells Fargo &amp; Co., 3.50%, 4/04/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,010,640</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">19,083,517</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Health Care&#151;7.3%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">NR</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Healthsouth Corp., 7.375%, 10/01/06</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,025,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,945</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Insight Health Services Corp., Ser. B, 9.875%, 11/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,945,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Merck &amp; Co., Inc., 4.375%, 2/15/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">994,030</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Tenet Healthcare Corp.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">405</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.375%, 12/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">369,562</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">15</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.50%, 6/01/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">13,613</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">640 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">9.875%, 7/01/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">670,400</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">United Surgical Partners Intl., Inc., 10.00%, 12/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,721,250</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">7,738,855</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Media&#151;13.4%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">NR</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">4</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Adelphia Communications Corp., Ser. B, 10.50%, 12/31/49</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">880,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B1</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Alliance Atlantis Communications, Inc., 13.00%, 12/15/09 (Canada)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,612,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">AOL Time Warner, Inc., 7.70%, 5/01/32</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,196,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Cenveo Corp., 9.625%, 3/15/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,230,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">325</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Charter Communications Holdings II, LLC, 10.25%, 9/15/10</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">338,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,775</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Charter Communications Holdings LLC, 11.125%, 1/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,491,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Comcast Cable Communications, Inc., 6.875%, 6/15/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,118,703</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD align=center colspan=7>
<FONT size=2 face="serif">See Notes to Financial Statements.</FONT>
        </TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2 face="serif">46</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT size=2 face="serif">BlackRock Strategic Bond Trust (BHD) (continued)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=7>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>
          </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>
          </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<B><FONT size=2 face="serif">(unaudited)</FONT></B>&nbsp;
        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">(000</FONT></B><B><FONT size=2 face="serif">)</FONT></B>&nbsp;
          </center></TD>
        <TD width=70% align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><FONT size=2
face="serif">Description</FONT></B>&nbsp;
        </TD>
        <TD colspan="2" align=left>
      <center>
        <B><FONT size=2 face="serif">Value</FONT></B>&nbsp;
          </center></TD>
  </TR>
<TR>
        <TD colspan=7>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Media&#151;(cont&#146;d)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=right>
<FONT size=1 face="serif">$</FONT>
        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Nextmedia Operating, Inc., 10.75%, 7/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
          </div></TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,250,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">775</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Primedia, Inc., 7.625%, 4/01/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">780,813</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">750</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Vertis, Inc., 10.875%, 6/15/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">817,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">85</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Viacom, Inc., 6.625%, 5/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">95,630</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">CCC</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">WRC Media, Inc., 12.75%, 11/15/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,410,000</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">14,220,646</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Real Estate&#151;2.5%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">860</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">American Real Estate Partners LP, 8.125%, 6/01/12</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">907,300</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">ERP Operating LP, 6.95%, 3/02/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">567,220</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Felcore Lodging LP,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B1</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">9.00%, 6/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,130,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B1</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">80</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">10.00%, 9/15/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">84,000</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,688,520</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Technology&#151;2.9%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Amkor Technology, Inc., 9.25%, 2/15/08</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">960,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Unisys Corp., 8.125%, 6/01/06</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,130,000</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">3,090,000</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Telecommunications&#151;7.0%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">750</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">ACC Escrow Corp., Ser. B, 10.00%, 8/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">630,000</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Bellsouth Corp., 4.20%, 9/15/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,009,660</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Crown Castle Intl. Corp., 10.75%, 8/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,107,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">MCI, Inc.,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">36</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">5.908%, 5/01/07</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">36,045</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">36</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">6.688%, 5/01/09</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">35,460</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">31</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">7.735%, 5/01/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">29,915</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BB</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">200</FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Qwest Corp., 7.875%, 9/01/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">212,500</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A-</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">3</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Telecom Italia Capital, 4.95%, 9/30/14 (Luxembourg)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">992,160</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Aa3</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">2,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Verizon New England, Inc., 6.50%, 9/15/11</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">2,222,520</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">A</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Vodafone Group PLC, 7.75%, 2/15/10 (United Kingdom)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,177,200</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">7,452,960</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Transportation&#151;1.0%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">BBB+</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">500</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Canadian National Railway Co., 6.90%, 7/15/28 (Canada)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">570,880</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">B</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">440</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Sea Containers Ltd., 10.50%, 5/15/12 (Bermuda)</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">456,500</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,027,380</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total Corporate Bonds</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">113,313,467</FONT>&nbsp;      </TD>
</TR>
<TR>
  <TD colspan=5></TD>
  <TD colspan=2><HR noshade size=1>
  </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">U.S. Government and Agency Securities&#151;3.9%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">410 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">U.S. Treasury Bonds, 5.375%, 2/15/31</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">445,490</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">U.S. Treasury Notes,</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,010 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">2.50%, 5/31/06</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,010,949</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">933 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">2.625%, 11/15/06</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">933,877</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.25%, 8/15/13</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,022,340</FONT>&nbsp;
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">710 </FONT><SUP></SUP>
        </TD>
        <TD width=3% align=left><SUP><FONT size=1 face="serif">2</FONT></SUP>

        </TD>
        <TD width=70% align=left>
 &nbsp; &nbsp;<FONT size=1 face="serif">4.75%, 5/15/14</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">750,825</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Total U.S. Government and Agency Securities</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">4,163,481</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Foreign Government Bonds&#151;1.1%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">Baa2</FONT>&nbsp;
        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=right>
<FONT size=1 face="serif">1,000</FONT>
        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">United Mexican States, 8.125%, 12/30/19</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

        </TD>
        <TD width=9% align=right>
<FONT size=1 face="serif">1,171,000</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=2>
<HR noshade size=1>
        </TD>
</TR>
</TABLE>
<center>
  <BR>
  <FONT size=2 face="serif">See Notes to Financial Statements.</FONT><BR>
</center>
<P align="center">
<FONT size=2 face="serif">47</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD colspan=5 align=left>
<B><FONT size=2 face="serif">BlackRock Strategic Bond Trust (BHD) (continued)</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=8>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Principal</FONT></B>&nbsp;
          </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>
 <center>
   <B><FONT size=2 face="serif">Rating</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>&nbsp;
    </center></TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Amount</FONT></B>&nbsp;
          </center></TD>
        <TD width=70% align=left>&nbsp;

        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>
      <center>
        <B><FONT size=2 face="serif">(unaudited) </FONT></B>
    </center></TD>
        <TD colspan=3 align=left>      <center>
    <B><FONT size=2 face="serif">(000)</FONT></B>&nbsp;        </center></TD>
        <TD width=70% align=right>
      <center>
        <B><FONT size=2 face="serif">Description</FONT></B>&nbsp;
          </center></TD>
        <TD colspan="3" align=left>

          <center>
      <B><FONT size=2 face="serif">Value</FONT></B>         </center></TD>
  </TR>
<TR>
        <TD colspan=8>
<HR noshade size=1>
        </TD>
</TR>
<TR>
        <TD colspan=8>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<B><FONT size=2 face="serif">Supranational&#151;0.8%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=center>
<FONT size=1 face="serif">AAA</FONT>&nbsp;
        </TD>
        <TD width=4% align=right>
<FONT size=1 face="serif">$</FONT>
        </TD>
        <TD width=3% align=center>
      <div align="right"><FONT size=1 face="serif">850</FONT>
          </div></TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">European Investment Bank, 4.875%, 9/06/06</FONT>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
          </div></TD>
        <TD align=right>
<FONT size=1 face="serif">883,277</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<B><FONT size=1 face="serif">Total Investments </FONT></B><FONT size=1 face="serif">(cost $113,309,408)</FONT>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
          </div></TD>
        <TD align=right>
<FONT size=1 face="serif">119,531,225</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<FONT size=1 face="serif">Liabilities in excess of other assets&#151;(12.3)%</FONT>&nbsp;
        </TD>
        <TD width=1% align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=1 face="serif">(13,098,100</FONT>
        </TD>
        <TD align=left>
<FONT size=1 face="serif">)</FONT>&nbsp;
        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR align="left" size=1 noshade>
        </TD>
</TR>
<TR valign="bottom">
        <TD width=10% align=left>&nbsp;

        </TD>
        <TD width=4% align=left>

        </TD>
        <TD width=3% align=left>&nbsp;

        </TD>
        <TD width=3%>&nbsp;
        </TD>
        <TD width=70% align=left>
<B><FONT size=1 face="serif">Net Assets&#151;100%</FONT></B>&nbsp;
        </TD>
        <TD width=1% align=right>
      <div align="left"><FONT size=1 face="serif">$</FONT>
          </div></TD>
        <TD align=right>
      <FONT size=1 face="serif">106,433,125</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=5>
        </TD>
        <TD colspan=3>
<HR align="left" size=3 noshade>
        </TD>
</TR>
</TABLE>
<BR>
<TABLE border=0 cellspacing=0 cellpadding=0>
<TR>
  <TD colspan="2" valign=top nowrap><HR align="left" width="100" size=1></TD>
  </TR>
<TR valign="top">
        <TD nowrap>
<SUP><FONT size=1 face="serif">1</FONT></SUP>&nbsp; &nbsp; &nbsp;       </TD>
        <TD>
<FONT size=1 face="serif">Using the higher of S&amp;P&#146;s, Moody&#146;s or Fitch&#146;s rating.</FONT>       </TD>
</TR>
<TR valign="top"><TD colspan=2>&nbsp;</TD></TR><TR valign="top">
        <TD nowrap>
<SUP><FONT size=1 face="serif">2</FONT></SUP>&nbsp; &nbsp; &nbsp;       </TD>
        <TD>
<FONT size=1 face="serif">Entire or partial principal amount pledged as collateral for reverse repurchase agreements or financial futures contracts.</FONT>     </TD>
</TR>
<TR valign="top"><TD colspan=2>&nbsp;</TD></TR><TR valign="top">
        <TD nowrap>
<SUP><FONT size=1 face="serif">3</FONT></SUP>&nbsp;     </TD>
        <TD>
<FONT size=1 face="serif">Security is not registered under the Securities Act of 1933. These securities may be resold in transactions in accordance with Rule 144A under that Act, to qualified institutional buyers. As of October 31, 2004, the Trust
held 8.3% of its net assets, with a current market value of $8,830,967, in securities restricted as to resale.</FONT></TD>
</TR>
<TR valign="top"><TD colspan=2>&nbsp;</TD></TR><TR valign="top">
        <TD nowrap>
<SUP><FONT size=1 face="serif">4</FONT></SUP>&nbsp; &nbsp; &nbsp;       </TD>
        <TD>
<FONT size=1 face="serif">Issuer is technically in default and/or bankruptcy.</FONT>    </TD>
</TR>
<TR><TD colspan=2>&nbsp;</TD></TR></TABLE>
<P>
<FONT size=1 face="serif">Details of open reverse repurchase agreements are disclosed in Note 4 in the Notes to Financial Statements.</FONT></P>
<P>
<FONT size=1 face="serif">A category in the Corporate Bonds section may contain multiple industries as defined by the SEC&#146;s Standard Industry Codes.</FONT></P>
<center>
  <FONT size=2 face="serif">See Notes to Financial Statements.</FONT><BR>
</center>
<P align="center">
<FONT size=2 face="serif">48</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<A name="page_51"></A>

<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
        <TD width="64%" align=center>
      <div align="left"><B><FONT size=4 face="serif">STATEMENTS OF ASSETS AND LIABILITIES</FONT></B>&nbsp;
          </div></TD>
        <TD width="1%" align=left>

        </TD>
        <TD width="12%" align=left>

        </TD>
        <TD width="3%" align=left>&nbsp;

        </TD>
        <TD width="4%">&nbsp;
        </TD>
        <TD width="1%" align=left>

          <div align="left"></div></TD>
        <TD width="11%" align=left>&nbsp;

        </TD>
    <TD width="4%" align=left>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
<B><FONT face="serif">October 31, 2004</FONT></B>&nbsp;
        </TD>
        <TD align=left>


        </TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=left>&nbsp;

        </TD>
    <TD align=left>&nbsp;</TD>
</TR>
<TR>
        <TD colspan=8>
<HR noshade size=1>
        </TD>
</TR>
<TR>
        <TD colspan=8>&nbsp;

        </TD>
</TR>
<TR>
        <TD colspan=8>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD align=left>&nbsp;

        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Broad Investment</FONT></B>
          </center></TD>
        <TD>
          <center>
    </center></TD>
        <TD align=left>      <div align="left"></div></TD>
        <TD align=left>

          <center>
    </center></TD>
    <TD align=left><center>
    </center></TD>
</TR>
<TR valign="bottom">
        <TD align=left>&nbsp;

        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Grade 2009</FONT></B>
          </center></TD>
        <TD>
          <center>
    </center></TD>
        <TD colspan="3" align=left>      <center>
          <B><FONT size=2 face="serif">Core</FONT></B>&nbsp;
    </center></TD>
  </TR>
<TR valign="bottom">
        <TD align=left>&nbsp;

        </TD>
        <TD colspan="3" align=left>
      <center>
        <B><FONT size=2 face="serif">Term Trust Inc.</FONT></B><B><SUP><FONT size=2 face="serif">1</FONT></SUP></B>
          </center></TD>
        <TD>
          <center>
    </center></TD>
        <TD colspan="3" align=left>      <center>
          <B><FONT size=2 face="serif">Bond Trust</FONT></B>&nbsp;
    </center></TD>
  </TR>
<TR valign="bottom">
        <TD align=left>&nbsp;
        </TD>
        <TD colspan="3" align=left><center>
          <B><FONT size="2" face="serif">(BCT)</FONT></B>&nbsp;
    </center></TD>
        <TD>
          <center>
    </center></TD>
        <TD colspan="3" align=left>      <center>
          <B><FONT size="2" face="serif">(BHK)</FONT></B>&nbsp;
    </center></TD>
  </TR>
<TR>
        <TD>
        </TD>
        <TD colspan=3>
<HR noshade size=1>
        </TD>
    <TD>&nbsp;</TD>
    <TD colspan=3><HR align="left" size=1 noshade></TD>
  </TR>
<TR valign="bottom">
        <TD align=left>
<B><FONT size=2 face="serif">Assets</FONT></B>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=left>&nbsp;

        </TD>
    <TD align=left>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Investments at value</FONT><SUP><FONT size=2 face="serif">2</FONT></SUP>&nbsp;
        </TD>
        <TD align=left><FONT size=2 face="serif">$</FONT>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">66,171,306</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=right>
      <div align="left"><FONT size=2 face="serif">$</FONT>
          </div></TD>
        <TD align=right>
<FONT size=2 face="serif">578,546,345</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Cash</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">45,939</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">47,177</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Foreign currency at value</FONT><SUP><FONT size=2 face="serif">3</FONT></SUP>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">1,563</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Receivable from investments sold</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">92,655,368</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Variation margin receivable</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">23,313</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">242,188</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Receivable for open forward foreign currency contracts</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">28,896,140</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Interest receivable</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">690,461</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">7,932,844</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Unrealized appreciation on interest rate swaps</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">444,416</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Other assets</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">16,904</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">70,665</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR>
        <TD>
        </TD>
        <TD>
<HR noshade size=1>
        </TD>
    <TD><HR noshade size=1></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><HR align="left" size=1 noshade></TD>
    <TD><HR noshade size=1></TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>&nbsp;

        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">66,947,923</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">708,836,706</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR>
  <TD></TD>
  <TD><HR noshade size=1>
  </TD>
  <TD><HR noshade size=1></TD>
  <TD>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD><HR align="left" size=1 noshade></TD>
  <TD><HR noshade size=1></TD>
  <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
<B><FONT size=2 face="serif">Liabilities</FONT></B>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=left>&nbsp;

        </TD>
    <TD align=left>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Reverse repurchase agreement</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">19,262,500</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">102,473,974</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Payable to custodian</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Payable for investments purchased</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">154,043,827</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Payable for dollar rolls</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">9,845,811</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Collateral due to broker</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Variation margin payable</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Loan payable</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Investments sold short at value</FONT><SUP><FONT size=2 face="serif">4</FONT></SUP>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Outstanding options written at value</FONT><SUP><FONT size=2 face="serif">5</FONT></SUP>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">1,338,972</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Interest payable</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">12,176</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">380,262</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Unrealized depreciation on interest rate swaps</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Interest rate floors at value</FONT><SUP><FONT size=2 face="serif">5</FONT></SUP>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Payable for open forward foreign currency contracts</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">29,192,235</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Investment advisory fee payable</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">21,923</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">234,803</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Administration fee payable</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">5,979</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Deferred Directors&#146;/Trustees&#146; fees</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">13,875</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">46,229</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Other accrued expenses</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">376,037</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">117,335</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR>
  <TD></TD>
  <TD><HR noshade size=1>
  </TD>
  <TD><HR noshade size=1></TD>
  <TD>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD><HR align="left" size=1 noshade></TD>
  <TD><HR noshade size=1></TD>
  <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>&nbsp;

        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">19,692,490</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">297,673,448</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR>
  <TD></TD>
  <TD><HR noshade size=1>
  </TD>
  <TD><HR noshade size=1></TD>
  <TD>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD><HR align="left" size=1 noshade></TD>
  <TD><HR noshade size=1></TD>
  <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
<B><FONT size=2 face="serif">Net Assets</FONT></B>&nbsp;
        </TD>
        <TD align=left><FONT size=2 face="serif">$</FONT>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">47,255,433</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=right>
      <div align="left"><FONT size=2 face="serif">$</FONT>
          </div></TD>
        <TD align=right>
<FONT size=2 face="serif">411,163,258</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR>
  <TD></TD>
  <TD><HR noshade size=3>
  </TD>
  <TD><HR noshade size=3></TD>
  <TD>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD><HR align="left" size=3 noshade></TD>
  <TD><HR noshade size=3></TD>
  <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
<FONT size=2 face="serif">Composition of Net Assets:</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=left>&nbsp;

        </TD>
    <TD align=left>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Par value</FONT>&nbsp;
        </TD>
        <TD align=left><FONT size=2 face="serif">$</FONT>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">29,571</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=right>
      <div align="left"><FONT size=2 face="serif">$</FONT>
          </div></TD>
        <TD align=right>
<FONT size=2 face="serif">27,019</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Paid-in capital in excess of par</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">38,787,677</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">386,197,188</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Cost of shares held in treasury</FONT><SUP><FONT size=2 face="serif">6</FONT></SUP>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Undistributed (distributions in excess of) net investment income</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">7,945,414</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">2,267,985</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Accumulated net realized gain (loss)</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">(2,210,230</FONT>
        </TD>
        <TD align=left>
<FONT size=2 face="serif">)</FONT>&nbsp;
        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">4,664,264</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
 &nbsp; &nbsp;<FONT size=2 face="serif">Net unrealized appreciation (depreciation)</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">2,703,001</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">18,006,802</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR>
  <TD></TD>
  <TD><HR noshade size=1>
  </TD>
  <TD><HR noshade size=1></TD>
  <TD>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD><HR align="left" size=1 noshade></TD>
  <TD><HR noshade size=1></TD>
  <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
<FONT size=2 face="serif">Net assets, October 31, 2004</FONT>&nbsp;
        </TD>
        <TD align=left><div align="right"><FONT size=2 face="serif">$</FONT>

        </div></TD>
        <TD align=right>
<FONT size=2 face="serif">47,255,433</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=right>
      <div align="left"><FONT size=2 face="serif">$</FONT>
          </div></TD>
        <TD align=right>
<FONT size=2 face="serif">411,163,258</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR>
  <TD></TD>
  <TD><HR noshade size=3>
  </TD>
  <TD><HR noshade size=3></TD>
  <TD>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD><HR align="left" size=3 noshade></TD>
  <TD><HR noshade size=3></TD>
  <TD>&nbsp;</TD>
</TR>
<TR>
        <TD colspan=8>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD align=left>
<FONT size=2 face="serif">Net asset value</FONT><SUP><FONT size=2 face="serif">7</FONT></SUP>&nbsp;
        </TD>
        <TD align=right>
<FONT size=2 face="serif">$</FONT>
        </TD>
        <TD align=right>
<FONT size=2 face="serif">15.98</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=right>
      <div align="left"><FONT size=2 face="serif">$</FONT>
          </div></TD>
        <TD align=right>
<FONT size=2 face="serif">15.22</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR>
  <TD></TD>
  <TD><HR noshade size=3>
  </TD>
  <TD><HR noshade size=3></TD>
  <TD>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD><HR align="left" size=3 noshade></TD>
  <TD><HR noshade size=3></TD>
  <TD>&nbsp;</TD>
</TR>
<TR>
        <TD colspan=8>&nbsp;

        </TD>
</TR>
<TR valign="bottom">
        <TD align=left>
<SUP><FONT size=2 face="serif">1 </FONT></SUP><FONT size=2 face="serif">Consolidated Statement of Assets and Liabilities</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=left>

        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=left>&nbsp;

        </TD>
    <TD align=left>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
<SUP><FONT size=2 face="serif">2 </FONT></SUP><FONT size=2 face="serif">Investments at cost</FONT>&nbsp;
        </TD>
        <TD align=left><div align="right"><FONT size=2 face="serif">$</FONT>

        </div></TD>
        <TD align=right>
<FONT size=2 face="serif">63,602,403</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=right>
      <div align="left"><FONT size=2 face="serif">$</FONT>
          </div></TD>
        <TD align=right>
<FONT size=2 face="serif">562,275,317</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
<SUP><FONT size=2 face="serif">3 </FONT></SUP><FONT size=2 face="serif">Foreign currency at cost</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">1,569</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
<SUP><FONT size=2 face="serif">4 </FONT></SUP><FONT size=2 face="serif">Proceeds received</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
<SUP><FONT size=2 face="serif">5 </FONT></SUP><FONT size=2 face="serif">Premium received</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">2,196,443</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
<SUP><FONT size=2 face="serif">6 </FONT></SUP><FONT size=2 face="serif">Shares held in treasury</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">&#151;</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD align=left>
<SUP><FONT size=2 face="serif">7 </FONT></SUP><FONT size=2 face="serif">Common shares outstanding</FONT>&nbsp;
        </TD>
        <TD align=left>

        </TD>
        <TD align=right>
<FONT size=2 face="serif">2,957,093</FONT>
        </TD>
        <TD align=left>&nbsp;

        </TD>
        <TD>&nbsp;
        </TD>
        <TD align=left>

          <div align="left"></div></TD>
        <TD align=right>
<FONT size=2 face="serif">27,018,774</FONT>&nbsp;
        </TD>
    <TD align=right>&nbsp;</TD>
</TR>
</TABLE>
<center>
  <BR>
  <FONT size=2 face="serif">See Notes to Financial Statements.</FONT><BR>
</center>
<P align="center">
<FONT size=2 face="serif">49</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=center>
      <center>
        <B><FONT size=2>Income</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=center>
      <center>
        <B><FONT size=2>Limited</FONT></B>&nbsp;
      </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=center>
      <center>
        <B><FONT size=2>High</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=right>
      <center>
        <B><FONT size=2>Opportunity</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=center>
      <center>
        <B><FONT size=2>Income</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=center>
      <center>
        <B><FONT size=2>Duration</FONT></B>&nbsp;
      </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=center>
      <center>
        <B><FONT size=2>Strategic</FONT></B>
      </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <center>
        <B><FONT size=2>Yield Trust</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=center>
      <center>
        <B><FONT size=2>Trust</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=right>
      <center>
        <B><FONT size=2>Trust Inc.</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=right>
      <center>
        <B><FONT size=2>Income Trust</FONT></B>&nbsp;
      </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=right>
      <center>
        <B><FONT size=2>Bond Trust</FONT></B>
      </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=center>
      <center>
        <font size="2"><B>(BHY)</B>
	    </font>
    </center></TD>
	<TD align=left>

	  <center>
    <font size="2"></font>
    </center></TD>
	<TD>
	  <center>
    <font size="2"></font>
    </center></TD>
	<TD align=left>

	  <center>
    <font size="2"></font>
    </center></TD>
	<TD align=center>
      <center>
        <font size="2"><B>(BNA)</B>
	    </font>
    </center></TD>
	<TD align=left>

	  <center>
    <font size="2"></font>
    </center></TD>
	<TD>
	  <center>
    <font size="2"></font>
    </center></TD>
	<TD align=left>

	  <center>
    <font size="2"></font>
    </center></TD>
	<TD align=center>
      <center>
        <font size="2"><B>(BKT)</B>
	    </font>
    </center></TD>
	<TD align=left>

	  <center>
    <font size="2"></font>
    </center></TD>
	<TD>
	  <center>
    <font size="2"></font>
    </center></TD>
	<TD align=left>

	  <center>
    <font size="2"></font>
    </center></TD>
	<TD align=center>
      <center>
        <font size="2"><B>(BLW)</B>&nbsp;
	    </font>
    </center></TD>
	<TD>
	  <center>
    <font size="2"></font>
    </center></TD>
	<TD align=left>

	  <center>
    <font size="2"></font>
    </center></TD>
	<TD align=center>
      <center>
        <font size="2"><B>(BHD)</B>
	    </font>
    </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR>
	<TD colspan=18>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>68,414,848</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>575,075,772</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>671,123,896</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>1,009,669,740</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>119,531,225</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>123,396</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>406,123</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>320,608</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>159,456</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>1,851,793</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>165,321,199</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>16,812,288</FONT>
	</TD>
	<TD align=left>&nbsp;


	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>10,623,166</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>691,470</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>434,230</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>1,580,281</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>7,800,964</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>6,781,264</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>14,229,589</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>2,578,853</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>601,663</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>23,915</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>132,395</FONT>
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<FONT size=2>295,757,077</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>16,543,494</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>50,914,040</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>426,643,449</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>442,634,616</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>739,225,394</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>106,433,125</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
<HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=18>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>6,404</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>344,497</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>637,155</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>36,727</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>7,049</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>93,588,410</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>406,532,068</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>528,754,021</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>700,009,639</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>100,448,229</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>(17,377,850</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>(20,945</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>2,972,407</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>3,499,237</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>1,786,417</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>188,743</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>(35,430,908</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>7,486,517</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>(79,321,675</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>5,497,163</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>(432,713</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>(7,228,921</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>26,685,810</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>(10,934,122</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>31,895,448</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>6,221,817</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>50,914,040</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>426,643,449</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>442,634,616</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>739,225,394</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>106,433,125</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;
</TD>
	<TD>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=18>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=18>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>$7.95</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>$12.38</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>$6.95</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>$20.13</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>$15.10</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD><HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD><HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD><HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD><HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
	</TD>
	<TD><HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=18>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=18>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>75,643,790</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>553,389,628</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>679,519,317</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>977,774,292</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>113,309,408</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>45,796,477</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>12,897,590</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>2,557,620</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>2,915,166</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>1,757,400</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>6,403,606</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>34,449,693</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>63,715,468</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>36,727,287</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>7,048,718</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2>50</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
	<TD width="66%" align=left>
<B><FONT size=4>STATEMENTS OF OPERATIONS</FONT></B>&nbsp;
	</TD>
	<TD width="2%" align=left>

	</TD>
	<TD width="13%" align=left>

	</TD>
	<TD width="2%" align=left>&nbsp;

	</TD>
	<TD width="1%">&nbsp;
	</TD>
	<TD width="2%" align=left>

	</TD>
	<TD width="12%" align=left>

	</TD>
	<TD width="2%" align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B>For the year ended October 31, 2004</B>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR>
	<TD colspan=8>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=8>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=center>
      <center>
        <B><FONT size=2>Broad Investment</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
      <center>
        <B><FONT size=2>Grade 2009</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=center>
      <center>
        <B><FONT size=2>Core</FONT></B>
      </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
      <center>
        <B><FONT size=2>Term Trust Inc.</FONT></B><B><SUP><FONT size=2>1</FONT></SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=right>
      <center>
        <B><FONT size=2>Bond Trust</FONT></B>
      </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=center>
      <center>
        <font size="2"><B>(BCT)</B>
	    </font>
    </center></TD>
	<TD align=left>

	  <center>
    <font size="2"></font>
    </center></TD>
	<TD>
	  <center>
    <font size="2"></font>
    </center></TD>
	<TD align=left>

	  <center>
    <font size="2"></font>
    </center></TD>
	<TD align=center>
      <center>
        <font size="2"><B>(BHK)</B>
	    </font>
    </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR>
	<TD colspan=8>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>Investment Income</FONT></B>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Interest income</FONT>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>2,977,991</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>30,195,091</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=8>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>Expenses</FONT></B>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Investment advisory</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>259,551</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>3,130,697</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Administration</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>70,786</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Transfer agent</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>10,881</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>15,006</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Custodian</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>63,546</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>191,332</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Reports to shareholders</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>18,830</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>112,440</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Directors/Trustees</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>12,960</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>58,194</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Registration</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>1,721</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>21,882</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Independent accountants</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>33,869</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>43,602</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Legal</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>33,972</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>50,037</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Insurance</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>4,966</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>39,993</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Miscellaneous</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>11,048</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>50,770</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<FONT size=2>Total expenses excluding interest expense and excise tax</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>522,130</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>3,713,953</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<FONT size=2>Interest expense</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>263,911</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>1,604,092</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<FONT size=2>Excise tax</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>384,842</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<FONT size=2>Total expenses</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>1,170,883</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>5,318,045</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<FONT size=2>Less fees waived by Advisor</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<FONT size=2>Less fees paid indirectly</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(3,160</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<FONT size=2>Net expenses</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>1,170,883</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>5,314,885</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net investment income</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>1,807,108</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>24,880,206</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=8>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>Realized and Unrealized Gain (Loss)</FONT></B>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net realized gain (loss) on:</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<FONT size=2>Investments</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(1,393,010</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>6,965,518</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<FONT size=2>Foreign currency</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>1,381,532</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<FONT size=2>Futures</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>738,035</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>7,218,852</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<FONT size=2>Interest rate swaps</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(4,631,178</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<FONT size=2>Options written</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>255,018</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<FONT size=2>Short sales</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>482,944</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(654,975</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>11,672,686</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net change in unrealized appreciation/depreciation on:</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<FONT size=2>Investments</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>1,547,410</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>4,369,084</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<FONT size=2>Foreign currency</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(269,102</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<FONT size=2>Futures</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(163,998</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>359,386</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<FONT size=2>Interest rate floors</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<FONT size=2>Interest rate swaps</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>637,592</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<FONT size=2>Options written</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>941,522</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<FONT size=2>Short sales</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>1,399</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>1,383,412</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>6,039,881</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net gain (loss)</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>728,437</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>17,712,567</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR>
	<TD colspan=8>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=8>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=center>
      <div align="left"><B><FONT size=2>Net Increase in Net Assets Resulting from Operations</FONT></B>&nbsp;
      </div></TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>2,535,545</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>42,592,773</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
<HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=8>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=8><HR align="left" width="100" size=1 noshade>

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<SUP><FONT size=1>1 </FONT></SUP><FONT size=1>Consolidated Statement of Operations.</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
</TABLE>
<center>
  <BR>
  <FONT size=2>See Notes to Financial Statements.</FONT><BR>
</center>
<P align="center">
<FONT size=2>51</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
	<TD align=left>

	</TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=center>
      <center>
        <B><FONT size=2>Income</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=center>
      <center>
        <B><FONT size=2>Limited</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>

	</TD>
	<TD align=center>
      <center>
        <B><FONT size=2>High</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=right>
      <center>
        <B><FONT size=2>Opportunity</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=center>
      <center>
        <B><FONT size=2>Income</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=center>
      <center>
        <B><FONT size=2>Duration</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=center>
      <center>
        <B><FONT size=2>Strategic</FONT></B>
      </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>

	</TD>
	<TD align=right>
      <center>
        <B><FONT size=2>Yield Trust</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=center>
      <center>
        <B><FONT size=2>Trust</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=right>
      <center>
        <B><FONT size=2>Trust Inc.</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=right>
      <center>
        <B><FONT size=2>Income Trust</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=right>
      <center>
        <B><FONT size=2>Bond Trust</FONT></B>
      </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>

	</TD>
	<TD align=center>
      <center>
        <B><SUP>(BHY)</SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=center>
      <center>
        <B><SUP>(BNA)</SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=center>
      <center>
        <B><SUP>(BKT)</SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=center>
      <center>
        <B><SUP>(BLW)</SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=center>
      <center>
        <B><SUP>(BHD)</SUP></B>
      </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR>
	<TD colspan=19>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>7,153,272</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>30,732,704</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>38,088,047</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>62,767,611</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>11,125,359</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=19>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=19>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>708,081</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>2,490,784</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>2,911,895</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>5,802,236</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>1,008,133</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>67,437</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>415,131</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>671,976</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>16,104</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>33,438</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>86,402</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>17,934</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>15,006</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>38,318</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>149,194</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>175,922</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>274,426</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
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<FONT size=2>1,143,460</FONT>
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<FONT size=2>(1,253,560</FONT>
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<FONT size=2>741,176</FONT>
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<HR noshade size=1>
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<TR valign="bottom">
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<FONT size=2>(316,410</FONT>
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<FONT size=2>)</FONT>&nbsp;
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	<TD align=left>

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<FONT size=2>10,285,218</FONT>
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	</TD>
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<FONT size=2>(8,309,572</FONT>
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<FONT size=2>)</FONT>&nbsp;
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	<TD>&nbsp;
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	<TD align=left>

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<FONT size=2>5,497,164</FONT>
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	<TD align=left>

	</TD>
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<FONT size=2>1,061,047</FONT>
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	<TD align=left>&nbsp;

	</TD>
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	<TD colspan=19>&nbsp;

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<TR valign="bottom">
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<FONT size=2>6,773,216</FONT>
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	</TD>
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	<TD align=left>

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<FONT size=2>5,823,530</FONT>
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	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
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	<TD align=left>

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	<TD align=right>
<FONT size=2>(386,069</FONT>
	</TD>
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<FONT size=2>)</FONT>&nbsp;
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	<TD>&nbsp;
	</TD>
	<TD align=left>

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<FONT size=2>10,019,874</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
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	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>648,992</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>

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	<TD align=right>
<FONT size=2>&#151;</FONT>
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<FONT size=2>&#151;</FONT>
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<FONT size=2>&#151;</FONT>
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<FONT size=2>&#151;</FONT>
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<FONT size=2>&#151;</FONT>
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	<TD align=left>&nbsp;

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	<TD>&nbsp;
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	<TD align=left>

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	<TD align=right>
<FONT size=2>2,440,701</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
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	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(2,462,726</FONT>
	</TD>
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<FONT size=2>)</FONT>&nbsp;
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	<TD align=left>

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<FONT size=2>&#151;</FONT>
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<FONT size=2>&#151;</FONT>
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	<TD align=left>&nbsp;

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	<TD>&nbsp;
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	<TD align=left>

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	<TD align=right>
<FONT size=2>759,055</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
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	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
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	<TD align=left>&nbsp;

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<FONT size=2>&#151;</FONT>
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</TR>
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<FONT size=2>&#151;</FONT>
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	<TD align=left>&nbsp;

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	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(2,050,802</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(2,819,850</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
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	<TD>&nbsp;
	</TD>
	<TD align=left>

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	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

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	<TD>&nbsp;
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	<TD align=left>

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	<TD align=right>
<FONT size=2>&#151;</FONT>
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	<TD align=left>&nbsp;

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</TR>
<TR valign="bottom">
	<TD align=left>

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	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>1,304,689</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>1,572,874</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>186</FONT>
	</TD>
	<TD align=left>&nbsp;

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	<TD align=left>

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	<TD align=right>
<FONT size=2>&#151;</FONT>
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</TR>
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<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>672,046</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>1,609,585</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
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	<TD align=left>

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	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
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<HR noshade size=1>
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	<TD>&nbsp;</TD>
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	<TD>&nbsp;</TD>
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<HR noshade size=1>
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	<TD>&nbsp;
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<HR noshade size=1>
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<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
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<HR noshade size=1>
	</TD>
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<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>6,773,216</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>8,190,164</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(1,727,131</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>10,020,060</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>648,992</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>6,456,806</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>18,475,382</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(10,036,703</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>15,517,224</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>1,710,039</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR>
	<TD colspan=19>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=19>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>12,317,295</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>44,600,427</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>21,910,132</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>69,126,265</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>11,525,024</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>

      <HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
<HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2>52</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
	<TD width=67% align=left>
<B><FONT size=4>STATEMENTS OF CASH FLOWS</FONT></B>&nbsp;
	</TD>
	<TD width=2% align=left>

	  <div align="left"></div></TD>
	<TD width=14% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=1% align=left>

	  <div align="left"></div></TD>
	<TD width=10% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B>For the year ended October 31, 2004</B>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR>
	<TD colspan=8>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=center>
      <center>
        <B><FONT size=2>Broad Investment</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>Reconciliation of Net Increase</FONT></B>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
      <center>
        <B><FONT size=2>Grade 2009</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=center>
      <center>
        <B><FONT size=2>Core</FONT></B>
      </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<B><FONT size=2>in Net Assets Resulting from Operations to</FONT></B>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
      <center>
        <B><FONT size=2>Term Trust Inc.</FONT></B><B><SUP><FONT size=2>1</FONT></SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=right>
      <center>
        <B><FONT size=2>Bond Trust</FONT></B>
      </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<B><FONT size=2>Net Cash Flows Provided by (Used for)</FONT></B>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=center>
      <center>
        <B><SUP>(BCT)</SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=center>
      <center>
        <B><SUP>(BHK)</SUP></B>
      </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>&nbsp; &nbsp;<B><FONT size=2>Operating Activities</FONT></B>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;
 </TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net increase in net assets resulting from operations</FONT>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>2,535,545</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>42,592,773</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Decrease (Increase) in investments</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>202,833</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(16,769,060</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net realized loss (gain)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>654,975</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(11,672,686</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Decrease (Increase) in unrealized appreciation (depreciation)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(1,383,412</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(6,039,881</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Increase (Decrease) in investments sold short</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(1,459,680</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Increase (Decrease) in outstanding options written</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(814,480</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Decrease (Increase) in interest rate floor</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Decrease (Increase) in interest rate swaps</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(632,723</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Decrease (Increase) in receivable for investments sold</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1,144,618</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(47,475,502</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Decrease (Increase) in receivable for open forward foreign currency contracts</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(28,828,953</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Decrease (Increase) in variation margin receivable</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>33,250</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(242,188</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Decrease (Increase) in interest receivable</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>87,945</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>219,290</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Decrease (Increase) in other assets</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(2,546</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(20,888</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Increase (Decrease) in payable for investments purchased</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>51,591,431</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Increase in payable for dollar rolls</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>9,845,811</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Increase in collateral due to broker</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Increase (Decrease) in payable for open forward foreign currency contracts</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>29,192,235</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Increase (Decrease) in payable for closed forward foreign currency contracts, net</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(64,413</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Increase (Decrease) in variation margin payable</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(66,844</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Increase (Decrease) in interest payable</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(1,245</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>199,421</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Increase (Decrease) in investment advisory fee payable</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(474</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>23,352</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Increase (Decrease) in administration fee payable</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(129</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Increase (Decrease) in deferred Directors&#146;/Trustees&#146;fees</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>2,695</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>20,017</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Increase (Decrease) in accrued expenses</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>34,441</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>75,579</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Total adjustments</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>772,951</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(22,920,162</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net cash provided by (used for) operating activities</FONT>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>3,308,496</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>19,672,611</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
<HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=8>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>Increase (Decrease) in Cash and Foreign Currency</FONT></B>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net cash provided by (used for) operating activities</FONT>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>3,308,496</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>19,672,611</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Cash provided by (used for) financing activities:</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Capital contributions</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Increase (Decrease) in reverse repurchase agreements</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(690,125</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>10,805,505</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Cash dividends paid</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(2,661,384</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(29,969,225</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net cash provided by (used for) financing activities</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(3,351,509</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(19,163,720</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;   	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net increase (decrease) in cash</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(43,013</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>508,891</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Cash and foreign currency at beginning of year</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>88,952</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(460,151</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Cash and foreign currency at end of year</FONT>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>45,939</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>48,740</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>&nbsp;
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=8>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=8><HR align="left" width="100" size=1 noshade>

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<SUP><FONT size=1>1 </FONT></SUP><FONT size=1>Consolidated Statement of Cash Flows.</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
</TABLE>
<center>
  <BR>
  <FONT size=2>See Notes to Financial Statements.</FONT><BR>
</center>
<P align="center">
<FONT size=2>53</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=center>
      <center>
        <B><FONT size=2>Income</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=center>
      <center>
        <B><FONT size=2>Limited</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=center>
      <center>
        <B><FONT size=2>High</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=right>
      <center>
        <B><FONT size=2>Opportunity</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=center>
      <center>
        <B><FONT size=2>Income</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=center>
      <center>
        <B><FONT size=2>Duration</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=center>
      <center>
        <B><FONT size=2>Strategic</FONT></B>
      </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
      <center>
        <B><FONT size=2>Yield Trust</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=center>
      <center>
        <B><FONT size=2>Trust</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=right>
      <center>
        <B><FONT size=2>Trust Inc.</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=right>
      <center>
        <B><FONT size=2>Income Trust</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=right>
      <center>
        <B><FONT size=2>Bond Trust</FONT></B>
      </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=center>
      <center>
        <B><SUP>(BHY)</SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=center>
      <center>
        <B><SUP>(BNA)</SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=center>
      <center>
        <B><SUP>(BKT)</SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=center>
      <center>
        <B><SUP>(BLW)</SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=center>
      <center>
        <B><SUP>(BHD)</SUP></B>
      </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR>
	<TD colspan=19>

	  <div align="left"></div></TD>
</TR>
<TR valign="bottom">
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>12,317,295</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>44,600,427</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>21,910,132</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
 <div align="left"><FONT size=2>$</FONT>&nbsp;
    </div></TD>
	<TD align=right>
<FONT size=2>69,126,265</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>11,525,024</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(500,096</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1,996,389</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>27,894,473</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>70,982,192</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>28,538,849</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>316,410</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(10,285,218</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>8,309,572</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(5,497,164</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(1,061,047</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(6,773,216</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(8,190,164</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>2,084,881</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(10,020,060</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(648,992</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(7,924,587</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
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<FONT size=2>75,988</FONT>
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	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>56,129</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>10,632</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(6,460,270</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(10,583,583</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(87,967,368</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(54,802,143</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>32,370,350</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>5,857,025</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>34,016,844</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>(66,057,236</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
 &nbsp;
 <div align="left"><FONT size=2>$</FONT>&nbsp;
    </div></TD>
	<TD align=right>
<FONT size=2>14,324,122</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>43,895,374</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
<HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=19>

	  <div align="left"></div></TD>
</TR>
<TR>
	<TD colspan=19>

	  <div align="left"></div></TD>
</TR>
<TR valign="bottom">
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>5,857,025</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>34,016,844</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>(66,057,236</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
 &nbsp;
 <div align="left"><FONT size=2>$</FONT>&nbsp;
    </div></TD>
	<TD align=right>
<FONT size=2>14,324,122</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>43,895,374</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=19>

	  <div align="left"></div></TD>
</TR>
<TR valign="bottom">
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>210,485</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>


	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>2,335,670</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>429,365</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>200,599</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(8,734,112</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>101,968,776</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>40,422,256</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(32,683,740</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(6,051,794</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(28,937,742</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(38,921,208</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(55,077,640</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(11,337,469</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(5,841,309</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(37,671,854</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>65,383,238</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(14,226,019</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(43,820,610</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>15,716</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(3,655,010</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(673,998</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>98,103</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>74,764</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>107,680</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(406,757</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1,080,121</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>222,505</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>84,692</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>123,396</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>(4,061,767</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>406,123</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>320,608</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>159,456</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
  <TD><HR align="left" size=3 noshade>
  </TD>
  <TD><HR align="left" size=3 noshade>
  </TD>
  <TD>&nbsp;</TD>
  <TD></TD>
  <TD><HR align="left" size=3 noshade>
  </TD>
  <TD><HR align="left" size=3 noshade>
  </TD>
  <TD>&nbsp;</TD>
  <TD></TD>
  <TD><HR align="left" size=3 noshade>
  </TD>
  <TD><HR align="left" size=3 noshade>
  </TD>
  <TD>&nbsp;</TD>
  <TD></TD>
  <TD><HR align="left" size=3 noshade>
  </TD>
  <TD><HR align="left" size=3 noshade>
  </TD>
  <TD>&nbsp;</TD>
  <TD></TD>
  <TD><HR align="left" size=3 noshade>
  </TD>
  <TD><HR align="left" size=3 noshade>
  </TD>
  <TD>&nbsp;</TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2>54</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<A name="page_57"></A>

<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
	<TD colspan=3 align=left>
<B><FONT size=4>STATEMENTS OF CHANGES IN NET ASSETS</FONT></B>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD colspan=3 align=left>
<B>For the years ended October 31, 2004 and 2003</B>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR align="center" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR align="center" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR align="center" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR>
	<TD colspan=16>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD colspan=5 align=left>
 <center>
   <B><FONT size=2>Broad Investment Grade</FONT></B>
    </center></TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD colspan=5 align=left>
 <center>
   <B><FONT size=2>2009 Term Trust Inc.</FONT></B><B><SUP><FONT size=2>1</FONT></SUP></B>
    </center></TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD colspan=5 align=center>
<B><FONT size=2>Core Bond Trust</FONT></B>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD colspan="5" align=right>
      <center>
        <B><FONT size=2>(BCT)</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD colspan="5" align=left>
      <center>
        <B><FONT size=2>(BHK)</FONT></B>&nbsp;
      </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR align="center" size=1 noshade>
	</TD>
	<TD>
<HR align="center" size=1 noshade>
	</TD>
	<TD>
	  <center>
	    <HR align="center" size=1 noshade>
      </center></TD>
	<TD>
<HR align="center" size=1 noshade>
	</TD>
	<TD>
<HR align="center" size=1 noshade>
	</TD>
	<TD>
<HR align="center" size=1 noshade>
	</TD>
	<TD>
	  <center>
    </center></TD>
	<TD>
<HR align="center" size=1 noshade>
	</TD>
	<TD>
<HR align="center" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR align="center" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
      <center>
        <B><SUP>2004</SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=right>
      <center>
        <B><SUP>2003</SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=right>
      <center>
        <B><SUP>2004</SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=right>
      <center>
        <B><SUP>2003</SUP></B>
      </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>Increase (Decrease) in Net Assets</FONT></B>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>Operations:</FONT></B>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net investment income</FONT>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>1,807,108</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>3,760,612</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>24,880,206</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>22,380,605</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net realized gain (loss)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(654,975</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(2,958,847</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>11,672,686</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>10,108,933</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=center>
<FONT size=2>Net change in unrealized appreciation/depreciation</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1,383,412</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(1,159,473</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>6,039,881</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>10,896,869</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net increase (decrease) in net assets resulting</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>from operations</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>2,535,545</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(357,708</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>42,592,773</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>43,386,407</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>Dividends and Distributions:</FONT></B>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net investment income</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(2,661,384</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(3,504,653</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(23,226,362</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>(27,108,407</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net realized gain</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(6,742,863</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>(4,976,352</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Tax return of capital distributions</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Total dividends and distributions</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(2,661,384</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(3,504,653</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(29,969,225</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>(32,084,759</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>Capital Share Transactions:</FONT></B>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Reinvestment of dividends</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Total increase (decrease)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(125,839</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(3,862,361</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>12,623,548</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>11,301,648</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>Net Assets:</FONT></B>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Beginning of year</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>47,381,272</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>51,243,633</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>398,539,710</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>387,238,062</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>End of year</FONT>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>47,255,433</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>47,381,272</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>411,163,258</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>398,539,710</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>End of year undistributed (distribution in excess of)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>net investment income</FONT>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>7,945,414</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>8,349,474</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>2,267,985</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>&nbsp;
	</TD>
	<TD>
	  <div align="left"></div></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	  <div align="left"></div></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	  <div align="left"></div></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
</TR>
<TR>
	<TD colspan=16>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=16><hr align="left" width="100" size=1 noshade>

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<SUP><FONT size=1>1 </FONT></SUP><FONT size=1>Consolidated Statement of Changes in Net Assets.</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
</TABLE>
<center>
  <BR>
  <FONT size=2>See Notes to Financial Statements.</FONT><BR>
</center>
<P align="center">
<FONT size=2>55</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD colspan=5 align=center>
      <center>
        <B><FONT size=2>High Yield Trust</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD colspan=5 align=center>
      <center>
        <B><FONT size=2>Income Opportunity Trust</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD colspan=5 align=center>
      <center>
        <B><FONT size=2>Income Trust Inc.</FONT></B>
      </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD colspan="5" align=left>
      <center>
        <B><FONT size=2>(BHY)</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD colspan="5" align=left>
      <center>
        <B><FONT size=2>(BNA)</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD colspan="5" align=left>
      <center>
        <B><FONT size=2>(BKT)</FONT></B>
      </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <center>
        <B><SUP>2004</SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=right>
      <center>
        <B><SUP>2003</SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=right>
      <center>
        <B><SUP>2004</SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=right>
      <center>
        <B><SUP>2003</SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=right>
      <center>
        <B><SUP>2004</SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=right>
      <center>
        <B><SUP>2003</SUP></B>
      </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR>
	<TD colspan=23>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=23>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>5,860,489</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>6,766,264</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>26,125,045</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>28,912,640</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>31,946,835</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>38,641,106</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>(316,410</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(4,771,417</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>10,285,218</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(3,180,087</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(8,309,572</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(22,020,705</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>6,773,216</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
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<FONT size=2>8,190,164</FONT>
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<FONT size=2>14,036,271</FONT>
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<FONT size=2>(10,738,760</FONT>
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	<TD>
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<HR noshade size=1>
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<HR noshade size=1>
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<HR noshade size=1>
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<HR noshade size=1>
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<FONT size=2>12,321,422</FONT>
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<FONT size=2>21,910,132</FONT>
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<FONT size=2>5,881,641</FONT>
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<HR noshade size=1>
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<HR noshade size=1>
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<HR noshade size=1>
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<HR noshade size=1>
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<HR noshade size=1>
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<HR noshade size=1>
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	<TD>
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<HR noshade size=1>
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<HR noshade size=1>
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	<TD>
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	<TD>
<HR noshade size=1>
	</TD>
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<HR noshade size=1>
	</TD>
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</TR>
<TR>
	<TD>&nbsp;

	</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
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<TR valign="bottom">
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	</TD>
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<FONT size=2>(5,864,606</FONT>
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<FONT size=2>)</FONT>&nbsp;
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	<TD align=left>

	</TD>
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<FONT size=2>(7,116,448</FONT>
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	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
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	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(28,937,742</FONT>
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	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
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	</TD>
	<TD align=right>
<FONT size=2>(27,903,349</FONT>
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	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
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	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(38,921,208</FONT>
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	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
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	</TD>
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<FONT size=2>(63,862,381</FONT>
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<FONT size=2>)</FONT>&nbsp;
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<FONT size=2>&#151;</FONT>
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<FONT size=2>&#151;</FONT>
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<FONT size=2>&#151;</FONT>
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	</TD>
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<FONT size=2>(8,364,454</FONT>
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<FONT size=2>)</FONT>&nbsp;
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	<TD align=left>

	</TD>
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<FONT size=2>&#151;</FONT>
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<FONT size=2>&#151;</FONT>
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	</TD>
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	</TD>
	<TD align=right>
<FONT size=2>(187,188</FONT>
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<FONT size=2>)</FONT>&nbsp;
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	<TD align=left>

	</TD>
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<FONT size=2>&#151;</FONT>
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<FONT size=2>&#151;</FONT>
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<FONT size=2>&#151;</FONT>
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	</TD>
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<FONT size=2>&#151;</FONT>
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	<TD align=left>

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<FONT size=2>&#151;</FONT>
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<HR noshade size=1>
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<HR noshade size=1>
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	</TD>
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	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>(6,051,794</FONT>
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	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
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	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(7,116,448</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
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	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(28,937,742</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
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	<TD>&nbsp;
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	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(36,267,803</FONT>
	</TD>
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<FONT size=2>)</FONT>&nbsp;
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	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(38,921,208</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
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	<TD>&nbsp;
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	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(63,862,381</FONT>
	</TD>
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<FONT size=2>)</FONT>&nbsp;
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	<TD>
<HR noshade size=1>
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<HR noshade size=1>
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<HR noshade size=1>
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	<TD>&nbsp;
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	</TD>
	<TD>&nbsp;
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<HR noshade size=1>
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	<TD>&nbsp;
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<HR noshade size=1>
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<HR noshade size=1>
	</TD>
	<TD>&nbsp;
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</TR>
<TR>
	<TD colspan=23>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>210,485</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>280,376</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
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	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
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	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>2,335,670</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>3,905,622</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
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<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>6,475,986</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>5,485,350</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>15,662,685</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>3,501,021</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(14,675,406</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(54,075,118</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
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	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
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<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
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<HR noshade size=1>
	</TD>
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	</TD>
	<TD>&nbsp;</TD>
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	</TD>
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<HR noshade size=1>
	</TD>
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<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=23>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>44,438,054</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>38,952,704</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>410,980,764</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>407,479,743</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>457,310,022</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>511,385,140</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
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	</TD>
	<TD>&nbsp;</TD>
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	</TD>
	<TD>
<HR noshade size=1>
	</TD>
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<HR noshade size=1>
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	<TD>&nbsp;</TD>
	<TD>
	</TD>
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<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
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	</TD>
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<HR noshade size=1>
	</TD>
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<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
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	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
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	<TD align=right>
<FONT size=2>50,914,040</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
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	<TD align=right>
<FONT size=2>44,438,054</FONT>
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	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
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	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>426,643,449</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
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	<TD align=right>
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	<TD align=right>
<FONT size=2>410,980,764</FONT>
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	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
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	<TD align=right>
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	<TD align=right>
<FONT size=2>442,634,616</FONT>
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	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
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	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>457,310,022</FONT>
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<TR>
	<TD>
<HR align="left" size=3 noshade>
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	<TD>
      <HR align="left" size=3 noshade>
	</TD>
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	<TD>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
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      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
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      <HR align="left" size=3 noshade>
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      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
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	<TD>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR>
	<TD colspan=23>

	  <div align="left"></div></TD>
</TR>
<TR valign="bottom">
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>(20,945</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left><FONT size=2>$</FONT>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>2,972,407</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>5,785,104</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>3,499,237</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>10,115,860</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2>56</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<A name="page_59"></A>

<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
	<TD colspan=7 align=left>
<B><FONT size=4>STATEMENTS OF CHANGES IN NET ASSETS (continued)</FONT></B>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD colspan=3 align=left>
<B>For the years ended October 31, 2004 and 2003</B>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR>
	<TD colspan=16>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=16>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD colspan=5 align=left>
      <center>
        <B><FONT size=2>Limited Duration Income Trust</FONT></B><B><SUP><FONT size=2>1</FONT></SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD colspan=5 align=center>
      <center>
        <B><FONT size=2>Strategic Bond Trust</FONT></B>
      </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD colspan="5" align=right>
      <center>
        <B><SUP>(BLW)</SUP></B>
      </center></TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD colspan="5" align=left>
      <center>
        <B><SUP>(BHD)</SUP></B>
      </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
      <center>
        <B><SUP>2004</SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=right>
      <center>
        <B><SUP>2003</SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=right>
      <center>
        <B><SUP>2004</SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=right>
      <center>
        <B><SUP>2003</SUP></B>
      </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>Increase (Decrease) in Net Assets</FONT></B>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>Operations:</FONT></B>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net investment income</FONT>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>53,609,041</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>12,026,055</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>9,814,985</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>11,147,173</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net realized gain (loss)</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>5,497,164</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>390,465</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>1,061,047</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(1,177,052</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=center>
      <div align="left">&nbsp; &nbsp;<FONT size=2>Net change in unrealized appreciation/depreciation</FONT>&nbsp;
      </div></TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>10,020,060</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>21,875,388</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>648,992</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>17,670,059</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net increase in net assets resulting from operations</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>69,126,265</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>34,291,908</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>11,525,024</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>27,640,180</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>Dividends and Distributions:</FONT></B>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net investment income</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(54,687,174</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(9,176,505</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(11,337,469</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(10,466,535</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net realized gain</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(390,466</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Total dividends and distributions</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(55,077,640</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(9,176,505</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(11,337,469</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(10,466,535</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>Capital Share Transactions:</FONT></B>&nbsp;
	</TD>

	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=center>
      <div align="left">&nbsp; &nbsp;<FONT size=2>Net proceeds from the issuance of common shares</FONT>&nbsp;
      </div></TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>653,888,001</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net proceeds from the underwriters&#146;</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp; &nbsp; &nbsp;<FONT size=2>over-allotment option exercised</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>45,744,000</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Reinvestment of common dividends</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>429,365</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>200,599</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>277,020</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net proceeds from capital share transactions</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>429,365</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>699,632,001</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>200,599</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>277,020</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Total increase</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>14,477,990</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>724,747,404</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>388,154</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>17,450,665</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>Net Assets:</FONT></B>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Beginning of period</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>724,747,404</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>106,044,971</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>88,594,306</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>End of period</FONT>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>739,225,394</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>724,747,404</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>106,433,125</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>106,044,971</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=2 noshade>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=2 noshade>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=2 noshade>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=2 noshade>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>End of year undistributed net investment income</FONT>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>1,786,417</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>2,864,550</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>188,743</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>1,711,227</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
</TABLE>
<BR>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="top">
  <TD colspan="2" nowrap><hr align="left" width="100" size=1 noshade></TD>
  </TR>
<TR valign="top">
	<TD width="1%" nowrap>
<FONT size=1>1</FONT></TD>
	<TD width="99%">
<FONT size=1>Commencement of investment operations for Limited Duration was July 30, 2003. This information includes the initial investment by BlackRock Funding, Inc. The other Trust&#146;s statement is for a full year.</FONT></TD>
</TR>
<TR><TD colspan=2>&nbsp;</TD></TR></TABLE>
<P align="center">
<FONT size=2>See Notes to Financial Statements.</FONT></P>
<P align="center">
<FONT size=2>57</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<p><B>CONSOLIDATED FINANCIAL HIGHLIGHTS</B><BR>
    <B><FONT size=2>BlackRock Broad Investment Grade 2009 Term Trust Inc. (BCT)</FONT></B>
</p>
<p>&nbsp;</p>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD colspan="15" align=left>      <center>
	  <B><FONT size=2>Year Ended October 31,</FONT></B>&nbsp;
    </center></TD>
  </TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD colspan=6>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD colspan="2" align=left>

	  <div align="left"></div>
      <center>
        <B><SUP><FONT size=2>2004</FONT></SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD colspan="2" align=left>      <div align="left"></div>
      <center>
        <B><SUP><FONT size=2>2003</FONT></SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD colspan="2" align=left>      <div align="left"></div>
      <center>
        <B><SUP><FONT size=2>2002</FONT></SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD colspan="2" align=left>      <div align="left"></div>
      <center>
        <B><SUP><FONT size=2>2001</FONT></SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD colspan="2" align=left>      <div align="left"></div>
      <center>
        <B><SUP><FONT size=2>2000</FONT></SUP></B>
      </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>PER SHARE OPERATING PERFORMANCE:</FONT></B>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net asset value, beginning of year</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>16.02</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>17.33</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>16.05</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>13.64</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>13.64</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Investment operations:</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net investment income</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.61</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.28</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>2.01</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.17</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.91</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net realized and unrealized gain (loss)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.25</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(1.40</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.04</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>2.01</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.09</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net increase (decrease) from investment operations</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.86</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.12</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>2.05</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>3.18</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.82</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Dividends from net investment income</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.90</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(1.19</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.77</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.77</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.82</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net asset value, end of year</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>15.98</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>16.02</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>17.33</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>16.05</FONT>
	</TD>
	<TD align=left>&nbsp;
	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>13.64</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
<HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
<HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
<HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
<HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
<HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Market price, end of year</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>15.80</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>15.85</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>16.18</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>14.39</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>11.94</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
<HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
<HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
<HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
<HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
<HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>TOTAL INVESTMENT RETURN</FONT></B><SUP><FONT size=2>1</FONT></SUP>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>5.45</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>5.32</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>18.34</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>27.66</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>12.11</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
<HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
<HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
<HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
<HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD><HR noshade size=3>
	</TD>
	<TD>
<HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>RATIOS TO AVERAGE NET ASSETS:</FONT></B>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Total expenses</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>2.48</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>2.43</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>2.50</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>3.52</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>4.36</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net expenses</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>2.48</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>2.43</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>2.50</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>3.52</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>4.36</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net expenses excluding interest expense and excise tax</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.11</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.18</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.16</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.16</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.31</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net investment income</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>3.83</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>7.54</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>12.22</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>7.93</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>6.83</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>SUPPLEMENTAL DATA:</FONT></B>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Average net assets (000)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>47,191</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>49,882</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT></div></TD>
	<TD align=right><FONT size=2>48,731</FONT> </TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT></div></TD>
	<TD align=right><FONT size=2>43,701</FONT> </TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>39,425</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Portfolio turnover</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>20</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>39</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>35</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>19</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>36</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net assets, end of year (000)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>47,255</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>47,381</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT></div></TD>
	<TD align=right><FONT size=2>51,244</FONT> </TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT></div></TD>
	<TD align=right><FONT size=2>47,466</FONT> </TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>40,321</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Reverse repurchase agreements outstanding, end of year (000) .</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>19,263</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>19,953</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT></div></TD>
	<TD align=right><FONT size=2>23,669</FONT> </TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT></div></TD>
	<TD align=right><FONT size=2>13,373</FONT> </TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>18,850</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Asset coverage, end of year</FONT><SUP><FONT size=2>2</FONT></SUP>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>3,453</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>3,375</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
	  <div align="left"><FONT size=2>$</FONT></div></TD>
	<TD align=right>
<FONT size=2>3,165</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
	  <div align="left"><FONT size=2>$</FONT></div></TD>
	<TD align=right>
<FONT size=2>4,550</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>3,139</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
</TABLE>
<BR>
<TABLE border=0 cellspacing=0 cellpadding=0>
<TR>
  <TD colspan="2" valign=top nowrap><hr align="left" width="100" size=1 noshade></TD>
  </TR>
<TR valign="top">
	<TD width="18" nowrap>
<SUP><FONT size=1>1</FONT></SUP></TD>
	<TD width="1068">
<FONT size=1>Total investment return is calculated assuming a purchase of a share at the current market price on the first day and a sale at the current market price on the last day of each year reported. Dividends and distributions, if any, are
assumed for purposes of this calculation to be reinvested at prices obtained under the Trust&#146;s dividend reinvestment plan. Total investment returns do not reflect brokerage commissions. Past performance is not a guarantee of future
results.</FONT></TD>
</TR>
<TR valign="top"><TD colspan=2>&nbsp;</TD></TR><TR valign="top">
	<TD nowrap>
<SUP><FONT size=1>2</FONT></SUP></TD>
	<TD>
<FONT size=1>Per $1,000 of reverse repurchase agreements outstanding.</FONT></TD>
</TR>
<TR><TD colspan=2>&nbsp;</TD></TR></TABLE>
<P>
<FONT size=1>The information in the above Financial Highlights represents the operating performance for a common share outstanding, total investment returns, ratios to average net assets and other supplemental data for each year indicated. This
information has been determined based upon financial information provided in the financial statements and market price data for the Trust&#146;s common shares.</FONT></P>
<P align="center">
<FONT size=2>See Notes to Financial Statements.</FONT></P>
<P align="center">
<FONT size=2>58</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
	<TD width="56%" align=left>
<B>FINANCIAL HIGHLIGHTS</B>&nbsp;
	</TD>
	<TD width="2%" align=left>

	  <div align="left"></div></TD>
	<TD width="7%" align=left>

	</TD>
	<TD width="3%" align=left>&nbsp;

	</TD>
	<TD width="1%">&nbsp;
	</TD>
	<TD width="2%" align=left>

	  <div align="left"></div></TD>
	<TD width="7%" align=left>

	</TD>
	<TD width="3%" align=left>&nbsp;

	</TD>
	<TD width="5%">&nbsp;
	</TD>
	<TD width="3%" align=left>

	  <div align="left"></div></TD>
	<TD width="7%" align=left>

	</TD>
	<TD width="4%" align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>BlackRock Core Bond Trust (BHK)</FONT></B>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>&nbsp;</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD colspan="2" align=left>

	  <div align="left"></div>	  <center>
        <B><FONT size=1>For the period</FONT></B>
          </center>	</TD>
    <TD align=left>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD colspan="6" align=left>

	  <center>
      <B><FONT size=1>Year Ended October 31,</FONT></B>	    </center></TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD colspan="2" align=left>

	  <div align="left"></div>	  <center>
        <B><FONT size=1>November 30, 2001</FONT></B><B><SUP><FONT size=1>1</FONT></SUP></B>
          </center>	</TD>
    <TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD colspan=5>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD colspan="2">
	  <div align="left"></div>	  <center>
        <B><FONT size=1>through</FONT></B>
          </center>	</TD>
    <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD colspan="2" align=left>

	  <div align="left"></div>
      <center>
        <B><SUP><FONT size=2>2004</FONT></SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD colspan="2" align=left>

	  <center>
    </center>
      <center>
        <B><SUP><FONT size=2>2003</FONT></SUP></B>
      </center></TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD colspan="2" align=left>

	  <div align="left"></div>
      <center>
        <B><FONT size=1>October 31, 2002</FONT></B>
      </center>	</TD>
    <TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>PER SHARE OPERATING PERFORMANCE:</FONT></B>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net asset value, beginning of period</FONT>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>14.75</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>14.33</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
 <div align="left"><FONT size=2>$</FONT>&nbsp;
    </div></TD>
	<TD align=right>
<FONT size=2>14.33 </FONT><SUP></SUP>
	</TD>
	<TD align=left><SUP><FONT size=2>2</FONT></SUP>

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Investment operations:</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net investment income</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.92</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.83</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.99</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net realized and unrealized gain</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.66</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.77</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.04</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net increase from investment operations</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.58</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.60</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.03</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Dividends and distributions:</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net investment income</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.86</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(1.00</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(1.00</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net realized gain</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.25</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.18</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Total dividends and distributions</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(1.11</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(1.18</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(1.00</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Capital charges with respect to issuance of shares</FONT>&nbsp;
	</TD>

	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.03</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net asset value, end of period</FONT>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>15.22</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>14.75</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>  <div align="left"><FONT size=2>$</FONT>&nbsp;
    </div></TD>
	<TD align=right>
<FONT size=2>14.33</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=2 noshade>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=2 noshade>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=2 noshade>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Market price, end of period</FONT>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>14.02</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>13.57</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left> <div align="left"><FONT size=2>$</FONT>&nbsp;
    </div></TD>
	<TD align=right>
<FONT size=2>13.82</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=2 noshade>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=2 noshade>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=2 noshade>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>TOTAL INVESTMENT RETURN</FONT></B><B><SUP><FONT size=2>3</FONT></SUP></B>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>11.93</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>6.62</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(1.02</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)%</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=2 noshade>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=2 noshade>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=2 noshade>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>RATIOS TO AVERAGE NET ASSETS:</FONT></B>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Total expenses</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.32</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.05</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.04</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT><SUP><FONT size=2>4</FONT></SUP>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net expenses</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.32</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.05</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.04</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT><SUP><FONT size=2>4</FONT></SUP>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net expenses excluding interest expense</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.92</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.87</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.93</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT><SUP><FONT size=2>4</FONT></SUP>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net investment income</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>6.20</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>5.58</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>7.67</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT><SUP><FONT size=2>4</FONT></SUP>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>SUPPLEMENTAL DATA:</FONT></B>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Average net assets (000)</FONT>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>401,212</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right><div align="left"><FONT size=2>$</FONT>
    </div></TD>
	<TD align=right><FONT size=2>401,049</FONT></TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
 <div align="left"><FONT size=2>$</FONT>&nbsp;
    </div></TD>
	<TD align=right>
<FONT size=2>380,277</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Portfolio turnover</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>398</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>161</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>73</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net assets, end of period (000)</FONT>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>411,163</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right><div align="left"><FONT size=2>$</FONT></div></TD>
	<TD align=right><FONT size=2>398,540</FONT> </TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left> <div align="left"><FONT size=2>$</FONT>&nbsp;
    </div></TD>
	<TD align=right>
<FONT size=2>387,238</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Reverse repurchase agreements outstanding, end of period (000)</FONT>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>102,474</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>91,668</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
 <div align="left"><FONT size=2>$</FONT>&nbsp;
    </div></TD>
	<TD align=right>
<FONT size=2>165,215</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Asset coverage, end of period</FONT><SUP><FONT size=2>5</FONT></SUP>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>5,012</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>5,348</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
 <div align="left"><FONT size=2>$</FONT>&nbsp;
    </div></TD>
	<TD align=right>
<FONT size=2>3,342</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
</TABLE>
<BR>
<TABLE border=0 cellspacing=0 cellpadding=0>
<TR>
  <TD colspan="2" valign=top nowrap><hr align="left" width="100" size=1 noshade></TD>
  </TR>
<TR valign="top">
	<TD nowrap>
<SUP><FONT size=1>1</FONT></SUP>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD>
<FONT size=1>Commencement of investment operations. This information includes the initial investment by BlackRock Funding, Inc.</FONT>	</TD>
</TR>
<TR valign="top">
	<TD nowrap>
<SUP><FONT size=1>2</FONT></SUP>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD>
<FONT size=1>Net asset value, beginning of period, reflects a deduction of $0.675 per share sales charge from the initial offering price of $15.00 per share.</FONT>	</TD>
</TR>
<TR valign="top">
	<TD nowrap>
<SUP><FONT size=1>3</FONT></SUP></TD>
	<TD>
<FONT size=1>Total investment return is calculated assuming a purchase of a share at the current market price on the first day and a sale at the current market price on the last day of each period reported. Dividends and distributions, if any, are
assumed for purposes of this calculation to be reinvested at prices obtained under the Trust&#146;s dividend reinvestment plan. Total investment returns do not reflect brokerage commissions. Total investment returns for less than a full year are not
annualized.</FONT></TD>
</TR>
<TR valign="top">
<TD>&nbsp;</TD>	<TD>
<FONT size=1>Past performance is not a guarantee of future results.</FONT>	</TD>
</TR>
<TR valign="top">
	<TD nowrap>
<SUP><FONT size=1>4</FONT></SUP>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD>
<FONT size=1>Annualized.</FONT>	</TD>
</TR>
<TR>
	<TD nowrap valign=top>
<SUP><FONT size=1>5</FONT></SUP>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD>
<FONT size=1>Per $1,000 of reverse repurchase agreements outstanding.</FONT>	</TD>
</TR>
<TR><TD colspan=2>&nbsp;</TD></TR></TABLE>
<P>
<FONT size=1>The information in the above Financial Highlights represents the operating performance for a common share outstanding, total investment returns, ratios to average net assets and other supplemental data for each period indicated. This
information has been determined based upon financial information provided in the financial statements and market price data for the Trust&#146;s common shares.</FONT></P>
<P align="center">
<FONT size=2>See Notes to Financial Statements.</FONT></P>
<P align="center">
<FONT size=2>59</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
	<TD align=left>
<B>FINANCIAL HIGHLIGHTS</B>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>BlackRock High Yield Trust (BHY)</FONT></B>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=17>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD colspan="14" align=left>      <center>
	  <B><FONT size=2>Year Ended October 31,</FONT></B>&nbsp;
    </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="center" size=1 noshade>
	</TD>
	<TD>
<HR align="center" size=1 noshade>
	</TD>
	<TD>
<HR align="center" size=1 noshade>
	</TD>
	<TD>
<HR align="center" size=1 noshade>
	</TD>
	<TD colspan=6>
<HR align="center" size=1 noshade>
	</TD>
	<TD>
<HR align="center" size=1 noshade>
	</TD>
	<TD>
<HR align="center" size=1 noshade>
	</TD>
	<TD>
<HR align="center" size=1 noshade>
	</TD>
	<TD>
<HR align="center" size=1 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD colspan="2" align=left>      <center>
	  <B><SUP><FONT size=2>2004</FONT></SUP></B>
    </center></TD>
	<TD align=left>      <center>
    </center></TD>
	<TD colspan="2" align=left>      <center>
	  <B><SUP><FONT size=2>2003</FONT></SUP></B>
    </center></TD>
	<TD align=left>      <center>
    </center></TD>
	<TD colspan="2" align=left>      <center>
	  <B><SUP><FONT size=2>2002</FONT></SUP></B>
    </center></TD>
	<TD align=left>      <center>
    </center></TD>
	<TD colspan="2" align=left>      <center>
	  <B><SUP><FONT size=2>2001</FONT></SUP></B>
    </center></TD>
	<TD align=left>      <center>
    </center></TD>
	<TD colspan="2" align=left>      <center>
	  <B><SUP><FONT size=2>2000</FONT></SUP></B>
    </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>PER SHARE OPERATING PERFORMANCE:</FONT></B>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net asset value, beginning of year</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>6.96</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>6.13</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>7.20</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>10.60</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>13.58</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Investment operations:</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net investment income</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.92</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.06</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.20</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.32</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.66</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net realized and unrealized gain (loss)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.02</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.89</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.98</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(3.13</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(3.02</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net increase (decrease) from investment operations</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.94</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.95</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.22</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(1.81</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(1.36</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Dividends and distributions:</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net investment income</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.92</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(1.07</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(1.20</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(1.48</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(1.62</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Tax return of capital</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.03</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.05</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.09</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.11</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Total dividends and distributions</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.95</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(1.12</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(1.29</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(1.59</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(1.62</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net asset value, end of year</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>7.95</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>6.96</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>6.13</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>7.20</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>10.60</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Market price, end of year</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>9.30</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>10.25</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>8.68</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>9.18</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>11.88</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>TOTAL INVESTMENT RETURN</FONT></B><B><SUP><FONT size=2>1</FONT></SUP></B>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.28</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>32.87</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>7.97</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD colspan=2 align=left>
      <div align="right"><FONT size=2>(11.31</FONT> </div></TD>
	<TD align=left>
<FONT size=2>)%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>8.23</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD colspan=2>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>RATIOS TO AVERAGE NET ASSETS:</FONT></B>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Total expenses</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>2.69</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>3.07</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>3.45</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>4.90</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>5.29</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net expenses</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>2.68</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>3.07</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>3.45</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>4.90</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>5.29</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net expenses excluding interest expense</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.96</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>2.22</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>2.20</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>2.03</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.99</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net investment income</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>12.16</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>16.37</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>16.29</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>14.23</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>13.12</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>SUPPLEMENTAL DATA:</FONT></B>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Average net assets (000)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>48,186</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>41,326</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left><div align="left"><FONT size=2>$</FONT>&nbsp; </div></TD>
	<TD align=right><FONT size=2>46,751</FONT> </TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>&nbsp; </div></TD>
	<TD align=right><FONT size=2>58,553</FONT> </TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>79,602</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Portfolio turnover</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>156</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>30</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left><div align="left"></div></TD>
	<TD align=right>
<FONT size=2>147</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>71</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>92</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net assets, end of year (000)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>50,914</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>44,438</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left><div align="left"><FONT size=2>$</FONT>&nbsp; </div></TD>
	<TD align=right><FONT size=2>38,953</FONT> </TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left><div align="left"><FONT size=2>$</FONT>&nbsp; </div></TD>
	<TD align=right><FONT size=2>45,520</FONT> </TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>66,867</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Loan outstanding, end of year (000)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>19,250</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>19,250</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left><div align="left"><FONT size=2>$</FONT>&nbsp; </div></TD>
	<TD align=right><FONT size=2>19,250</FONT> </TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left><div align="left"><FONT size=2>$</FONT>&nbsp; </div></TD>
	<TD align=right><FONT size=2>23,000</FONT> </TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>33,000</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Asset coverage, end of year</FONT><SUP><FONT size=2>2</FONT></SUP>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>3,645</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>3,308</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left><div align="left"><FONT size=2>$</FONT>&nbsp; </div></TD>
	<TD align=right><FONT size=2>3,024</FONT> </TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left><div align="left"><FONT size=2>$</FONT>&nbsp; </div></TD>
	<TD align=right><FONT size=2>2,983</FONT> </TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>3,032</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
</TABLE>
<BR>
<TABLE border=0 cellspacing=0 cellpadding=0>
<TR valign="top">
  <TD colspan="2" nowrap><hr align="left" width="100" size=1 noshade></TD>
  </TR>
<TR valign="top">
	<TD width="28" nowrap>
<SUP><FONT size=1>1</FONT></SUP></TD>
	<TD width="1058">
<FONT size=1>Total investment return is calculated assuming a purchase of a share at the current market price on the first day and a sale at the current market price on the last day of each period reported. Dividends and distributions, if any, are
assumed for purposes of this calculation, to be reinvested at prices obtained under the Trust&#146;s dividend reinvestment plan. Total investment return does not reflect brokerage commissions. Past performance is not a guarantee of future
results.</FONT></TD>
</TR>
<TR valign="top">
	<TD nowrap>
<SUP><FONT size=1>2</FONT></SUP>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD>
<FONT size=1>Per $1,000 of loan outstanding.</FONT>	</TD>
</TR>
<TR><TD colspan=2>&nbsp;</TD></TR></TABLE>
<P>
<FONT size=1>The information in the above Financial Highlights represents the operating performance for a common share outstanding, total investment returns, ratios to average net assets and other supplemental data for each year indicated. This
information has been determined based upon financial information provided in the financial statements and market price data for the Trust&#146;s common shares.</FONT></P>
<P align="center">
<FONT size=2>See Notes to Financial Statements.</FONT></P>
<P align="center">
<FONT size=2>60</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
	<TD align=left>
<B>FINANCIAL HIGHLIGHTS</B>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>BlackRock Income Opportunity Trust (BNA)</FONT></B>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=16>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=16>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD colspan="14" align=left>      <center>
	  <B><FONT size=2>Year Ended October 31,</FONT></B>&nbsp;
    </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="center" size=1 noshade>
	</TD>
	<TD>
<HR align="center" size=1 noshade>
	</TD>
	<TD>
<HR align="center" size=1 noshade>
	</TD>
	<TD>
<HR align="center" size=1 noshade>
	</TD>
	<TD colspan=6>
<HR align="center" size=1 noshade>
	</TD>
	<TD>
<HR align="center" size=1 noshade>
	</TD>
	<TD>
<HR align="center" size=1 noshade>
	</TD>
	<TD>
<HR align="center" size=1 noshade>
	</TD>
	<TD>
<HR align="center" size=1 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD colspan="2" align=left>
      <center>
        <B><SUP><FONT size=2>2004</FONT></SUP></B>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD colspan="2" align=left>
      <center>
        <B><SUP><FONT size=2>2003</FONT></SUP></B>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD colspan="2" align=left>
      <center>
        <B><SUP><FONT size=2>2002</FONT></SUP></B>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD colspan="2" align=left>
      <center>
        <B><SUP><FONT size=2>2001</FONT></SUP></B>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD colspan="2" align=left>
      <center>
        <B><SUP><FONT size=2>2000</FONT></SUP></B>
    </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>PER SHARE OPERATING PERFORMANCE:</FONT></B>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net asset value, beginning of year</FONT>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>11.93</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>11.83</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>11.47</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>11.03</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>11.45</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Investment operations:</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net investment income</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.76</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.84</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.15</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.87</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.70</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net realized and unrealized gain (loss)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.53</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.31</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.05</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.34</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.31</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net increase from investment operations</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.29</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.15</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.10</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.21</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.39</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Dividends and distributions:</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net investment income</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.84</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.81</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.75</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.23</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.39</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net realized gains</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.24</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.04</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Tax return of capital</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.54</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.41</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Total dividends and distributions</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.84</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(1.05</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.75</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.77</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.84</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Increase resulting from Trust shares repurchased</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.01</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.03</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net asset value, end of year</FONT>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>12.38</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>11.93</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>11.83</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>11.47</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>11.03</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
<HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Market price, end of year</FONT>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>11.38</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>10.95</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>10.50</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>10.41</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>9.75</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>TOTAL INVESTMENT RETURN</FONT></B><B><SUP><FONT size=2>1</FONT></SUP></B>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>12.04</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>14.71</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>8.44</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>15.09</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>9.82</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>RATIOS TO AVERAGE NET ASSETS:</FONT></B>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Total expenses</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.11</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.29</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.40</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>3.62</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>3.76</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net expenses</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.11</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.29</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.40</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>3.62</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>3.76</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net expenses excluding interest expense</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.84</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.89</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.93</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.01</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.88</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net investment income</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>6.29</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>6.99</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>10.04</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>7.76</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>6.14</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>SUPPLEMENTAL DATA:</FONT></B>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Average net assets (000)</FONT>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>415,131</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>413,543</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>394,495</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right><div align="left"><FONT size=2>$</FONT> </div></TD>
	<TD align=right><FONT size=2>388,478</FONT> </TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>396,157</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Portfolio turnover</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>300</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>46</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>153</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left><div align="left"></div></TD>
	<TD align=right>
<FONT size=2>83</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>82</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net assets, end of year (000)</FONT>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>426,643</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>410,981</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>407,480</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right><div align="left"><FONT size=2>$</FONT> </div></TD>
	<TD align=right><FONT size=2>397,756</FONT> </TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>383,651</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Reverse repurchase agreements outstanding, end of year (000) .</FONT>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>94,644</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>103,378</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>85,704</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right><div align="left"><FONT size=2>$</FONT> </div></TD>
	<TD align=right><FONT size=2>136,385</FONT> </TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>178,033</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Asset coverage, end of year</FONT><SUP><FONT size=2>2</FONT></SUP>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>5,508</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>4,976</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>5,755</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>3,916</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>3,155</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
</TABLE>
<BR>
<TABLE border=0 cellspacing=0 cellpadding=0>
<TR valign="top">
  <TD colspan="2" nowrap><hr align="left" width="100" size=1 noshade></TD>
  </TR>
<TR valign="top">
	<TD nowrap>
<SUP><FONT size=1>1</FONT></SUP></TD>
	<TD>
<FONT size=1>Total investment return is calculated assuming a purchase of a share at the current market price on the first day and a sale at the current market price on the last day of each year reported. Dividends and distributions, if any, are
assumed for purposes of this calculation to be reinvested at prices obtained under the Trust&#146;s dividend reinvestment plan. Total investment return does not reflect brokerage commissions. Past performance is not a guarantee of future
results.</FONT></TD>
</TR>
<TR valign="top">
	<TD nowrap>
<SUP><FONT size=1>2</FONT></SUP>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD>
<FONT size=1>Per $1,000 of reverse repurchase agreements outstanding.</FONT></TD>
</TR>
<TR><TD colspan=2>&nbsp;</TD></TR></TABLE>
<P>
<FONT size=1>The information in the above Financial Highlights represents the operating performance for a common share outstanding, total investment returns, ratios to average net assets and other supplemental data for each year indicated. This
information has been determined based upon financial information provided in the financial statements and market price data for the Trust&#146;s common shares.</FONT></P>
<P align="center">
<FONT size=2>See Notes to Financial Statements.</FONT></P>
<P align="center">
<FONT size=2>61</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
	<TD align=left>
<B>FINANCIAL HIGHLIGHTS</B>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>BlackRock Income Trust Inc. (BKT)</FONT></B>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=17>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD colspan="14" align=left>
      <center>
        <B><FONT size=2>Year Ended October 31,</FONT></B>&nbsp;
      </center></TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD colspan=6>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD colspan="2" align=left>
      <center>
        <B><SUP><FONT size=2>2004</FONT></SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD colspan="2" align=left>
      <center>
        <B><SUP><FONT size=2>2003</FONT></SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD colspan=2 align=right>
      <center>
        <B><SUP><FONT size=2>2002</FONT></SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD colspan="2" align=left>
      <center>
        <B><SUP><FONT size=2>2001</FONT></SUP></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD colspan="2" align=left>
      <center>
        <B><SUP><FONT size=2>2000</FONT></SUP></B>
      </center></TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>PER SHARE OPERATING PERFORMANCE:</FONT></B>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net asset value, beginning of year</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>7.21</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>$</FONT>
	</TD>
	<TD align=right>
<FONT size=2>8.13</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>8.06</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>7.23</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>$</FONT>
	</TD>
	<TD align=right>
<FONT size=2>7.31</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Investment operations:</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net investment income</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>0.51</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>0.61</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>0.99</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>0.56</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>0.50</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net realized and unrealized gain (loss)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>(0.16</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(0.52</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD colspan=2 align=left>
      <div align="right"><FONT size=2>(0.35</FONT>
      </div></TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>0.83</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(0.02</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net increase from investment operations</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>0.35</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>0.09</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>0.64</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>1.39</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>0.48</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Dividends from net investment income</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>(0.61</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(1.01</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD colspan=2 align=left>
      <div align="right"><FONT size=2>(0.57</FONT>
      </div></TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>(0.56</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>(0.56</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD colspan=2>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net asset value, end of year</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>6.95</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>7.21</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>8.13</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>8.06</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>$</FONT>
	</TD>
	<TD align=right>
<FONT size=2>7.23</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Market price, end of year</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>7.50</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>7.71</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>8.07</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>7.26</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>$</FONT>
	</TD>
	<TD align=right>
<FONT size=2>6.38</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
  <TD></TD>
  <TD></TD>
  <TD><HR noshade size=3>
  </TD>
  <TD><HR noshade size=3>
  </TD>
  <TD>&nbsp;</TD>
  <TD><HR noshade size=3>
  </TD>
  <TD><HR noshade size=3>
  </TD>
  <TD>&nbsp;</TD>
  <TD><HR noshade size=3>
  </TD>
  <TD><HR noshade size=3>
  </TD>
  <TD>&nbsp;</TD>
  <TD><HR noshade size=3>
  </TD>
  <TD><HR noshade size=3>
  </TD>
  <TD>&nbsp;</TD>
  <TD><HR noshade size=3>
  </TD>
  <TD><HR noshade size=3>
  </TD>
  <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>TOTAL INVESTMENT RETURN</FONT></B><B><SUP><FONT size=2>1</FONT></SUP></B>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>5.97</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>15.41</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD colspan=2 align=left>
      <div align="right"><FONT size=2>15.35</FONT>
      </div></TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>23.23</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>14.01</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
</TR>
<TR>
  <TD></TD>
  <TD></TD>
  <TD><HR noshade size=3>
  </TD>
  <TD><HR noshade size=3>
  </TD>
  <TD>&nbsp;</TD>
  <TD><HR noshade size=3>
  </TD>
  <TD><HR noshade size=3>
  </TD>
  <TD>&nbsp;</TD>
  <TD><HR noshade size=3>
  </TD>
  <TD><HR noshade size=3>
  </TD>
  <TD>&nbsp;</TD>
  <TD><HR noshade size=3>
  </TD>
  <TD><HR noshade size=3>
  </TD>
  <TD>&nbsp;</TD>
  <TD><HR noshade size=3>
  </TD>
  <TD><HR noshade size=3>
  </TD>
  <TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>RATIOS TO AVERAGE NET ASSETS:</FONT></B>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Total expense</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>1.37</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>1.36</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>2.05</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>2.54</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>2.78</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net expenses</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>1.37</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>1.36</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>2.05</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>2.54</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>2.78</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net expenses excluding interest expense</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>0.97</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>1.02</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>1.03</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>1.03</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>1.05</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net investment income</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>7.13</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>8.18</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD colspan=2 align=left>
      <div align="right"><FONT size=2>12.28</FONT>
      </div></TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>7.43</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	</TD>
	<TD align=right>
<FONT size=2>7.11</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>SUPPLEMENTAL DATA:</FONT></B>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Average net assets (000)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>447,984</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>472,676</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right><div align="left"><FONT size=2>$</FONT> </div></TD>
	<TD align=right><FONT size=2>506,533</FONT> </TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right><div align="left"><FONT size=2>$</FONT></div></TD>
	<TD align=right><FONT size=2>470,185</FONT> </TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>448,027</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Portfolio turnover</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>120</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>64</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left><div align="left"></div></TD>
	<TD align=right>
<FONT size=2>125</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>32</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>114</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net assets, end of year (000)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>442,635</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>457,301</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right><div align="left"><FONT size=2>$</FONT> </div></TD>
	<TD align=right><FONT size=2>511,385</FONT> </TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right><div align="left"><FONT size=2>$</FONT></div></TD>
	<TD align=right><FONT size=2>506,764</FONT> </TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>454,510</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Reverse repurchase agreements outstanding,</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left><div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>end of year (000)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>223,736</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>121,767</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right><div align="left"><FONT size=2>$</FONT> </div></TD>
	<TD align=right><FONT size=2>205,792</FONT> </TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right><div align="left"><FONT size=2>$</FONT></div></TD>
	<TD align=right><FONT size=2>118,634</FONT> </TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>64,460</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Asset coverage, end of year</FONT><SUP><FONT size=2>2</FONT></SUP>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
<FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>2.978</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>4,756</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right><div align="left"><FONT size=2>$</FONT> </div></TD>
	<TD align=right><FONT size=2>3,485</FONT> </TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>
      <div align="left"><FONT size=2>$</FONT>&nbsp;
      </div></TD>
	<TD align=right>
<FONT size=2>5,272</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>8,095</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
</TABLE>
<BR>
<TABLE border=0 cellspacing=0 cellpadding=0>
<TR>
  <TD colspan="2" valign=top nowrap><hr align="left" width="100" size=1 noshade></TD>
  </TR>
<TR valign="top">
	<TD nowrap>
<SUP><FONT size=1>1</FONT></SUP> 	</TD>
	<TD>
<FONT size=1>Total investment return is calculated assuming a purchase of a share at the current market price on the first day and a sale at the current market price on the last day of each year reported. Dividends and distributions, if any, are
assumed for purposes of this calculation to be reinvested at prices obtained under the Trust&#146;s dividend reinvestment plan. Total investment returns do not reflect brokerage commissions. Past performance is not a guarantee of future
results.</FONT></TD>
</TR>
<TR valign="top">
	<TD nowrap>
<SUP><FONT size=1>2</FONT></SUP>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD>
<FONT size=1>Per $1,000 of reverse repurchase agreements outstanding.</FONT>	</TD>
</TR>
<TR><TD colspan=2>&nbsp;</TD></TR></TABLE>
<P>
<FONT size=1>The information in the above Financial Highlights represents the operating performance for a common share outstanding, total investment returns, ratios to average net assets and other supplemental data for each year indicated. This
information has been determined based upon financial information provided in the financial statements and market price data for the Trust&#146;s common shares.</FONT></P>
<P align="center">
<FONT size=2>See Notes to Financial Statements.</FONT></P>
<P align="center">
<FONT size=2>62</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
	<TD width="63%" align=left>
<B>FINANCIAL HIGHLIGHTS</B>&nbsp;
	</TD>
	<TD width="4%">&nbsp;
	</TD>
	<TD width="1%" align=left>&nbsp;

	</TD>
	<TD width="10%" align=left>

	</TD>
	<TD width="3%" align=left>&nbsp;

	</TD>
	<TD width="2%">&nbsp;
	</TD>
	<TD width="2%" align=left>&nbsp;

	</TD>
	<TD width="10%" align=left>

	</TD>
	<TD width="5%" align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>BlackRock Limited Duration Income Trust (BLW)</FONT></B>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=9>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD colspan="2" align=left>
      <center>
        <B><FONT size=1>For the period</FONT></B>
      </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD colspan="2" align=left>
      <center>
        <B><FONT size=1>July 30, 2003</FONT></B><B><SUP><FONT size=1>1</FONT></SUP></B>
      </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD colspan="2" align=left>
      <center>
        <B><FONT size=1>Year Ended</FONT></B>
      </center></TD>
	<TD align=left>

	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
	<TD colspan="2" align=left>
      <center>
        <B><FONT size=1>through</FONT></B>
      </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD colspan="2" align=left>
      <center>
        <B><FONT size=1>October 31, 2004</FONT></B>
      </center></TD>
	<TD align=left>&nbsp;</TD>
	<TD>
	  <center>
    </center></TD>
	<TD colspan="2" align=left>
      <center>
        <B><FONT size=1>October 31, 2003</FONT></B>
      </center></TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>PER SHARE OPERATING PERFORMANCE:</FONT></B>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net asset value, beginning of period</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>
 <div align="left"><FONT size=2>$</FONT>&nbsp;
    </div></TD>
	<TD align=right>
<FONT size=2>19.74</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left> <FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>19.10</FONT></TD>
	<TD align=left><SUP><FONT size=2>2</FONT></SUP></TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Investment operations:</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net investment income</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>1.46</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>0.33</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net realized and unrealized gain</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>0.43</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>0.60</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net increase from investment operations</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>1.89</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>0.93</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Dividends and Distributions:</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net investment income</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>(1.49</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>(0.25</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net realized gain</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>(0.01</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Total dividends and distributions</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>(1.50</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>(0.25</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Capital charges with respect to issuance of shares</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>(0.04</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net asset value, end of period</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left> <FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>20.13</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left> <FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>19.74</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Market price, end of period</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left> <FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>19.95</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left> <FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>18.80</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>TOTAL INVESTMENT RETURN</FONT></B><B><SUP><FONT size=2>3</FONT></SUP></B>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>14.64</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>(4.77</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)%</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>
      <HR noshade size=3>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>RATIOS TO AVERAGE NET ASSETS:</FONT></B>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Total expenses</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>1.26</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>0.82</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT><SUP><FONT size=2>4</FONT></SUP>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net expenses</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>1.25</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>0.82</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT><SUP><FONT size=2>4</FONT></SUP>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net expenses excluding interest expense</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>0.90</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>0.79</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT><SUP><FONT size=2>4</FONT></SUP>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net investment income</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>7.34</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>6.87</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT><SUP><FONT size=2>4</FONT></SUP>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>SUPPLEMENTAL DATA:</FONT></B>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Average net assets (000)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left> <FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>730,369</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left> <FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>686,655</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Portfolio turnover</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>215</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD align=right>
<FONT size=2>127</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net assets, end of period (000)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left> <FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>739,225</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left> <FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>724,747</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Reverse repurchase agreements outstanding, end of period (000)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left> <FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>159,416</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left> <FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>118,993</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Asset coverage, end of period</FONT><SUP><FONT size=2>5</FONT></SUP>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left> <FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>5,637</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left> <FONT size=2>$</FONT>&nbsp;
	</TD>
	<TD align=right>
<FONT size=2>7,091</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
</TABLE>
<BR>
<TABLE border=0 cellspacing=0 cellpadding=0>
<TR valign="top">
  <TD colspan="2" nowrap><hr align="left" width="100" size=1 noshade></TD>
  </TR>
<TR valign="top">
	<TD nowrap>
<SUP><FONT size=1>1</FONT></SUP>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD>
<FONT size=1>Commencement of investment operations. This information includes the initial investment by BlackRock Funding, Inc.</FONT>	</TD>
</TR>
<TR valign="top"><TD colspan=2>&nbsp;</TD>
</TR><TR valign="top">
	<TD nowrap>
<SUP><FONT size=1>2</FONT></SUP>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD>
<FONT size=1>Net asset value, beginning of period, reflects a deduction of $0.90 per share sales charge from the initial offering price of $20.00 per share.</FONT>	</TD>
</TR>
<TR valign="top"><TD colspan=2>&nbsp;</TD>
</TR><TR valign="top">
	<TD nowrap>
<SUP><FONT size=1>3</FONT></SUP>&nbsp; 	</TD>
	<TD>
<FONT size=1>Total investment return is calculated assuming a purchase of a share at the current market price on the first day and a sale at the current market price on the last day of each period reported. Dividends and distributions, if any, are
assumed for purposes of this calculation to be reinvested at prices obtained under the Trust&#146;s dividend reinvestment plan. Total investment returns do not reflect brokerage commissions. Total investment returns for less than a full year are not
annualized.</FONT></TD>
</TR>
<TR valign="top"><TD colspan=2>&nbsp;</TD>
</TR><TR valign="top">
<TD>&nbsp;</TD>
<TD>
<FONT size=1>Past performance is not a guarantee of future results.</FONT>	</TD>
</TR>
<TR><TD colspan=2>&nbsp;</TD></TR><TR valign="top">
	<TD nowrap>
<SUP><FONT size=1>4</FONT></SUP>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD>
<FONT size=1>Annualized.</FONT>	</TD>
</TR>
<TR valign="top"><TD colspan=2>&nbsp;</TD>
</TR><TR valign="top">
	<TD nowrap>
<SUP><FONT size=1>5</FONT></SUP>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD>
<FONT size=1>Per $1,000 of reverse repurchase agreements outstanding.</FONT>	</TD>
</TR>
<TR><TD colspan=2>&nbsp;</TD></TR></TABLE>
<P>
<FONT size=1>The information in the above Financial Highlights represents the operating performance for a common share outstanding, total investment returns, ratios to average net assets and other supplemental data for each period indicated. This
information has been determined based upon financial information provided in the financial statements and market price data for the Trust&#146;s common shares.</FONT></P>
<P align="center">
<FONT size=2>63</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<TABLE width="100%" border=0 cellpadding=0 cellspacing=0>
<TR valign="bottom">
	<TD width="54%" align=left>
<B>FINANCIAL HIGHLIGHTS</B>&nbsp;
	</TD>
	<TD width="2%">&nbsp;
	</TD>
	<TD width="2%" align=left>

	  <div align="left"></div></TD>
	<TD width="7%" align=left>

	</TD>
	<TD width="3%" align=left>&nbsp;

	</TD>
	<TD width="2%">&nbsp;
	</TD>
	<TD width="2%" align=left>

	  <div align="left"></div></TD>
	<TD width="7%" align=left>

	</TD>
	<TD width="3%" align=left>&nbsp;

	</TD>
	<TD width="3%">&nbsp;
	</TD>
	<TD width="3%" align=left>

	  <div align="left"></div></TD>
	<TD width="8%" align=left>

	</TD>
	<TD width="4%" align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>BlackRock Strategic Bond Trust (BHD)</FONT></B>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=13>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD colspan="2" align=left></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD colspan="2" align=left><center>
	  <B><FONT size=1>For the period</FONT></B>	  </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD colspan="6" align=left>

	  <center>
      <B><FONT size=1>Year Ended October 31,</FONT></B>	    </center></TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD colspan="2" align=left><center>
	  <B><FONT size=1>February 28, 2002</FONT></B><B><SUP><FONT size=1>1</FONT></SUP></B>	  </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD colspan=5>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD colspan="2" align=left valign="bottom"><center>
	  <B><FONT size=1>through</FONT></B>	  </center></TD>
	<TD>
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD colspan="2" align=left>

	  <div align="left"></div>
      <center>
      <B><SUP><FONT size=2>2004</FONT></SUP></B>      </center></TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD colspan="2" align=left>

	  <center>
      <B><SUP><FONT size=2>2003</FONT></SUP></B>	    </center></TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD colspan="2" align=left>

	  <center>
      <B><FONT size=1>October 31, 2002</FONT></B>	    </center></TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>PER SHARE OPERATING PERFORMANCE:</FONT></B>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net asset value, beginning of period</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>15.07</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>12.63</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>14.33</FONT><SUP></SUP>
	</TD>
	<TD align=left><SUP><FONT size=2>2</FONT></SUP>

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Investment operations:</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net investment income</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.39</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.59</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.98</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp; &nbsp;<FONT size=2>Net realized and unrealized gain (loss)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.25</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>2.34</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(1.77</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net increase (decrease) from investment operations</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.64</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>3.93</FONT>
	</TD>
	<TD align=left>&nbsp;</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.79</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Dividends from net investment income</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(1.61</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(1.49</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.84</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Capital charges with respect to issuance of shares</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(0.07</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net asset value, end of period</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>15.10</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>15.07</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>12.63</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Market price, end of period</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>16.70</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>15.27</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>12.35</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>TOTAL INVESTMENT RETURN</FONT></B><B><SUP><FONT size=2>3</FONT></SUP></B>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>21.54</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>37.36</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>(12.34</FONT>
	</TD>
	<TD align=left>
<FONT size=2>)%</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>
      <HR align="left" size=3 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>RATIOS TO AVERAGE NET ASSETS:</FONT></B>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Total expenses</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.49</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>2.01</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>2.57</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT><SUP><FONT size=2>4</FONT></SUP>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net expenses</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.23</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.71</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>2.26</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT><SUP><FONT size=2>4</FONT></SUP>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net expenses excluding interest expense</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>0.89</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.01</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>1.25</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT><SUP><FONT size=2>4</FONT></SUP>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net investment income</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>9.23</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>11.32</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>10.68</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT><SUP><FONT size=2>4</FONT></SUP>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<B><FONT size=2>SUPPLEMENTAL DATA:</FONT></B>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=left>

	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Average net assets (000)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>106,330</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>98,498</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>95,675</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Portfolio turnover</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>31</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>32</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=left>

	  <div align="left"></div></TD>
	<TD align=right>
<FONT size=2>22</FONT>
	</TD>
	<TD align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Net assets, end of period (000)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>106,433</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>106,045</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>88,594</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Reverse repurchase agreements outstanding, end of period (000)</FONT>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>13,188</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>45,872</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>44,223</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
<FONT size=2>Asset coverage, end of period</FONT><SUP><FONT size=2>5</FONT></SUP>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>9,071</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>3,312</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
	<TD>&nbsp;
	</TD>
	<TD align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD align=right>
<FONT size=2>3,003</FONT>
	</TD>
	<TD align=left>&nbsp;

	</TD>
</TR>
</TABLE>
<BR>
<TABLE border=0 cellspacing=0 cellpadding=0>
<TR valign="top">
  <TD colspan="2" nowrap><hr align="left" width="100" size=1 noshade></TD>
  </TR>
<TR valign="top">
	<TD nowrap>
<SUP><FONT size=1>1</FONT></SUP>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD>
<FONT size=1>Commencement of investment operations. This information includes the initial investment by BlackRock Funding, Inc.</FONT>	</TD>
</TR>
<TR valign="top">
	<TD nowrap>
<SUP><FONT size=1>2</FONT></SUP>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD>
<FONT size=1>Net asset value, beginning of period, reflects a deduction of $0.675 per share sales charge from the initial offering price of $15.00 per share.</FONT>	</TD>
</TR>
<TR valign="top">
	<TD nowrap>
<SUP><FONT size=1>3</FONT></SUP></TD>
	<TD><FONT size=1>Total investment return is calculated assuming a purchase of a share at the current market price on the first day and a sale at the current market price on the last day of each period reported. Dividends and distributions, if any, are
assumed for purposes of this calculation to be reinvested at prices obtained under the Trust&#146;s dividend reinvestment plan. Total investment returns do not reflect brokerage commissions. Total investment returns for less than a full year are not
annualized.</FONT></TD>
</TR>
<TR valign="top">
<TD>&nbsp;</TD>
<TD>
<FONT size=1>Past performance is not a guarantee of future results.</FONT>	</TD>
</TR>
<TR>
	<TD nowrap valign=top>
<SUP><FONT size=1>4</FONT></SUP>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD>
<FONT size=1>Annualized.</FONT>	</TD>
</TR>
<TR>
	<TD nowrap valign=top>
<SUP><FONT size=1>5</FONT></SUP>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD>
<FONT size=1>Per $1,000 of reverse repurchase agreements outstanding.</FONT>	</TD>
</TR>
<TR><TD colspan=2>&nbsp;</TD></TR></TABLE>
<P>
<FONT size=1>The information in the above Financial Highlights represents the operating performance for a common share outstanding, total investment returns, ratios to average net assets and other supplemental data for each period indicated. This
information has been determined based upon financial information provided in the financial statements and market price data for the Trust&#146;s common shares.</FONT></P>
<P align="center">
<FONT size=2>See Notes to Financial Statements.</FONT></P>
<P align="center">
<FONT size=2>64</FONT></P>

<HR noshade align="center" width="100%" size=4>
<PAGE>

<B><FONT size=4>NOTES TO FINANCIAL STATEMENTS</FONT></B><BR>
<P>
<B>Note 1. Organization &amp; Accounting Policies</B></P>
<P>
<FONT size=2>BlackRock Broad Investment Grade 2009 Term Trust Inc. (&#147;Broad Investment Grade&#148;), BlackRock Core Bond Trust (&#147;Core Bond&#148;), BlackRock High Yield Trust (&#147;High Yield&#148;), BlackRock Income Opportunity Trust
(&#147;Income Opportunity&#148;), BlackRock Income Trust Inc. (&#147;Income Trust&#148;), BlackRock Limited Duration</FONT></P>
<P>
<FONT size=2>Income Trust (&#147;Limited Duration&#148;) and BlackRock Strategic Bond Trust (&#147;Strategic Bond&#148;) (collectively, the &#147;Trusts&#148;) are registered as diversified, closed-end management investment companies under the
Investment Company Act of 1940, as amended. Broad Investment Grade, Income Opportunity and Income Trust are organized as Maryland corporations. Core Bond, High Yield, Limited Duration and Strategic Bond are organized as Delaware statutory
trusts.</FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>On December 3, 1999, Broad Investment Grade transferred a substantial portion of its total assets to a 100% owned regulated investment company subsidiary called BCT Subsidiary, Inc. The financial statements
and these notes to the financial statements for Broad Investment Grade are consolidated and include the operations of both Broad Investment Grade and its wholly owned subsidiary after elimination of all intercompany transactions and
balances.</FONT></P>
<P>
<FONT size=2>The following is a summary of significant accounting policies followed by the Trusts.</FONT></P>
<P>
<B><FONT size=2>Investment Valuation: </FONT></B><FONT size=2>The Trusts value most of their investments on the basis of current market quotations provided by dealers or pricing services selected under the supervision of each Trust&#146;s Board (the
&#147;Board&#148;) of Directors/Trustees (the &#147;Trustees&#148;). In determining the value of a particular investment, pricing services may use certain information with respect to transactions in such investments, quotations from dealers, market
transactions in comparable investments, various relationships observed in the market between investments, and calculated yield measures based on valuation technology commonly employed in the market for such investments. Exchange-traded options are
valued at their last sales price as of the close of options trading on applicable exchanges. In the absence of a last sale, options are valued at the average of the quoted bid and asked prices as of the close of business. A futures contract is
valued at the last sale price as of the close of the commodities exchange on which it trades. Short-term securities may be valued at amortized cost. Investments or other assets for which such current market quotations are not readily available are
valued at fair value (&#147;Fair Value Assets&#148;) as determined in good faith under procedures established by, and under the general supervision and responsibility of, each Trust&#146;s Board. The investment advisor and/or sub-advisor will submit
its recommendations regarding the valuation and/or valuation methodologies for Fair Value Assets to a valuation committee. The valuation committee may accept, modify or reject any recommendations. The pricing of all Fair Value Assets shall be
subsequently reported to and ratified by the Board of Trustees.</FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>When determining the price for a Fair Value Asset, the investment advisor and/or sub-advisor shall seek to determine the price that the Trust might reasonably expect to receive from the current sale of that
asset in an arms-length transaction. Fair value determinations shall be based upon all available factors that BlackRock Advisors deems relevant.</FONT></P>
<P>
<B><FONT size=2>Investment Transactions and Investment Income: </FONT></B><FONT size=2>Investment transactions are recorded on trade date. Realized and unrealized gains and losses are calculated on the identified cost basis. Each Trust records
interest income on an accrual basis and amortizes premium and/or accretes discount on securities purchased using the interest method. Dividend income is recorded on the ex-dividend date, except certain dividends from foreign securities where the
ex-dividend date may have passed. These dividends are recorded as soon as the Trust is informed of the ex-dividend date. Dividend income on foreign securities is recorded net of any withholding tax.</FONT></P>
<P>
<B><FONT size=2>Repurchase Agreements: </FONT></B><FONT size=2>In connection with transactions in repurchase agreements, a Trust&#146;s custodian takes possession of the underlying collateral securities, the value of which at least equals the
principal amount of the repurchase transaction, including accrued interest. To the extent that any repurchase transaction exceeds one business day, the value of the collateral is marked-to-market on a daily basis to ensure the adequacy of the
collateral. If the seller defaults and the value of the collateral declines or if bankruptcy proceedings are commenced with respect to the seller of the security, realization of the collateral by a Trust may be delayed or limited. </FONT></P>
<P>
<B><FONT size=2>Bank Loans: </FONT></B><FONT size=2>In the process of buying, selling and holding bank loans, a Trust may receive and/or pay certain fees. These fees are in addition to interest payments received and may include facility fees,
commitment fees, amendment fees, commissions and prepayment penalty fees. When a Trust buys a bank loan it may receive a facility fee and when it sells a bank loan it may pay a facility fee. On an ongoing basis, a Trust may receive a commitment fee
based on the undrawn portion of the underlying line of credit portion of a bank loan. In certain circumstances, a Trust may receive a prepayment penalty fee upon the prepayment of a bank loan by a borrower. Other fees received by a Trust may include
covenant waiver fees and covenant modification fees.</FONT></P>
<P>
<B><FONT size=2>Option Writing/Purchasing: </FONT></B><FONT size=2>When a Trust writes or purchases an option, an amount equal to the premium received or paid by the Trust is recorded as a liability or an asset and is subsequently adjusted to the
current market value of the option written or purchased. Premiums received or paid from writing or purchasing options which expire unexercised are treated by the Trust on the expiration date as realized gains or losses. The difference between the
premium and the amount paid or received on effecting a closing purchase or sale transaction, including brokerage commissions, is also treated as a realized gain or loss. If an option is exercised, the premium paid or received is added to the cost of
the purchase or the proceeds from the sale in determining whether a Trust has realized a gain or a loss on investment transactions. A Trust, as writer of an option, may have no control over whether the underlying securities may be sold (call) or
purchased (put) and as a result bears the market risk of an unfavorable change in the price of the security underlying the written option. </FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>Options, when used by the Trusts, help in maintaining a targeted duration. Duration is a measure of the price sensitivity of a security or a portfolio to relative changes in interest rates. For instance, a
duration of &#147;one&#148; means that a portfolio&#146;s or a security&#146;s price would be expected to change by approximately one percent with a one percent change in interest rates, while a duration of five would imply that the price would move
approximately five percent in relation to a one percent change in interest rates. </FONT></P>
<P align="center">
<FONT size=2>65</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<A name="page_68"></A>

<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>Option writing and purchasing may be used by the Trusts as an attempt to manage the duration of positions, or collections of positions, so that changes in interest rates do not adversely affect the targeted
duration of the portfolio unexpectedly. A call option gives the purchaser of the option the right (but not obligation) to buy, and obligates the seller to sell (when the option is exercised), the underlying position at the exercise price at any time
or at a specified time during the option period. A put option gives the holder the right to sell and obligates the writer to buy the underlying position at the exercise price at any time or at a specified time during the option period. Put or call
options can be purchased or sold to effectively help manage the targeted duration of the portfolio.</FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>The main risk that is associated with purchasing options is that the option expires without being exercised. In this case, the option expires worthless and the premium paid for the option is considered the
loss. The risk associated with writing call options is that a Trust may forgo the opportunity for a profit if the market value of the underlying position increases and the option is exercised. The risk in writing put options is that a Trust may
incur a loss if the market value of the underlying position decreases and the option is exercised. In addition, the Trust risks not being able to enter into a closing transaction for the written option as the result of an illiquid market.
</FONT></P>
<P>
<B><FONT size=2>Interest Rate Swaps: </FONT></B><FONT size=2>In an interest rate swap, one investor pays a floating rate of interest on a notional principal amount and receives a fixed rate of interest on the same notional principal amount for a
specified period of time. Alternatively, an investor may pay a fixed rate and receive a floating rate. Interest rate swaps are efficient as asset/liability management tools. In more complex swaps, the notional principal amount may decline (or
amortize) over time. </FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>During the term of the swap, changes in the value of the swap are recognized as unrealized gains or losses by &#147;marking-to-market&#148; to reflect the market value of the swap. When the swap is
terminated, a Trust will record a realized gain or loss equal to the difference between the proceeds from (or cost of) the closing transaction and the Trust&#146;s basis in the contract, if any. </FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>The Trusts are exposed to credit loss in the event of non-performance by the other party to the swap. However, the Trusts closely monitor swaps and do not anticipate non-performance by any counterparty.
</FONT></P>
<P>
<B><FONT size=2>Swap Options: </FONT></B><FONT size=2>Swap options are similar to options on securities except that instead of selling or purchasing the right to buy or sell a security, the writer or purchaser of the swap option is granting or
buying the right to enter into a previously agreed upon interest rate swap agreement at any time before the expiration of the option. Premiums received or paid from writing or purchasing options are recorded as liabilities or assets and are
subsequently adjusted to the current market value of the option written or purchased. Premiums received or paid from writing or purchasing options which expire unexercised are treated by a Trust on the expiration date as realized gains or losses.
The difference between the premium and the amount paid or received on effecting a closing purchase or sale transaction, including brokerage commission, is also treated as a realized gain or loss. If an option is exercised, the premium paid or
received is added to the cost of the purchase or the proceeds from the sale in determining whether a Trust has realized a gain or loss on investment transactions. </FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>The main risk that is associated with purchasing swap options is that the swap option expires without being exercised. In this case, the option expires worthless and the premium paid for the swap option is
considered the loss. The main risk that is associated with the writing of a swap option is the market risk of an unfavorable change in the value of the interest rate swap underlying the written swap option. </FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>Swap options may be used by the Trusts to manage the duration of the Trusts&#146; portfolios in a manner similar to more generic options described above. </FONT></P>
<P>
<B><FONT size=2>Interest Rate Caps: </FONT></B><FONT size=2>Interest rate caps are similar to interest rate swaps, except that one party agrees to pay a fee, while the other party pays the excess, if any, of a floating rate over a specified fixed or
floating rate. </FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>Interest rate caps are intended to both manage the duration of the Trusts&#146; portfolios and their exposure to changes in short-term interest rates. Owning interest rate caps reduces a portfolio&#146;s
duration, making it less sensitive to changes in interest rates from a market value perspective. The effect on income involves protection from rising short-term interest rates, which the Trusts experience primarily in the form of
leverage.</FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>The Trusts are exposed to credit loss in the event of non-performance by the other party to the interest rate cap. However, the Trusts do not anticipate non-performance by any counterparty. </FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>Transaction fees paid or received by the Trusts are recognized as assets or liabilities and amortized or accreted into interest expense or income over the life of the interest rate cap. The asset or
liability is subsequently adjusted to the current market value of the interest rate cap purchased or sold. Changes in the value of the interest rate cap are recognized as unrealized gains and losses. </FONT></P>
<P>
<B><FONT size=2>Interest Rate Floors: </FONT></B><FONT size=2>Interest rate floors are similar to interest rate swaps, except that one party agrees to pay a fee, while the other party pays the deficiency, if any, of a floating rate under a specified
fixed or floating rate. </FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>Interest rate floors are used by the Trusts to both manage the duration of the portfolios and their exposure to changes in short-term interest rates. Selling interest rate floors reduces a portfolio&#146;s
duration, making it less sensitive to changes in interest rates from a market value perspective. The Trusts&#146; leverage provides extra income in a period of falling rates. Selling floors reduces some of that extra income by partially monetizing
it as an up front payment which the Trusts receive. </FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>The Trusts are exposed to credit loss in the event of non-performance by the other party to the interest rate floor. However, the Trusts do not anticipate non-performance by any counterparty. </FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>Transaction fees paid or received by the Trusts are recognized as assets or liabilities and amortized or accreted into interest expense or income over the life of the interest rate floor. The asset or
liability is subsequently adjusted to the current market value of the interest rate floor purchased or sold. Changes in the value of the interest rate floor are recognized as unrealized gains and losses. </FONT></P>
<P align="center">
<FONT size=2>66</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<A name="page_69"></A>

<P>
<B><FONT size=2>Financial Futures Contracts: </FONT></B><FONT size=2>A futures contract is an agreement between two parties to buy and sell a financial instrument for a set price on a future date. Initial margin deposits are made upon entering into
futures contracts and can be either cash or securities. During the period the futures contract is open, changes in the value of the contract are recognized as unrealized gains or losses by &#147;marking-to-market&#148; on a daily basis to reflect
the market value of the contract at the end of each day&#146;s trading. Variation margin payments are made or received, depending upon whether unrealized gains or losses are incurred. When the contract is closed, a Trust records a realized gain or
loss equal to the difference between the proceeds from (or cost of) the closing transaction and the Trust&#146;s basis in the contract. </FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>Financial futures contracts, when used by the Trusts, help in maintaining a targeted duration. Futures contracts can be sold to effectively shorten an otherwise longer duration portfolio. In the same sense,
futures contracts can be purchased to lengthen a portfolio that is shorter than its duration target. Thus, by buying or selling futures contracts, the Trusts may attempt to manage the duration of positions so that changes in interest rates do not
change the duration of the portfolio unexpectedly. </FONT></P>
<P>
<B><FONT size=2>Forward Currency Contracts: </FONT></B><FONT size=2>The Trusts enter into forward currency contracts primarily to facilitate settlement of purchases and sales of foreign securities and to help manage the overall exposure to foreign
currency. A forward contract is a commitment to purchase or sell a foreign currency at a future date (usually the security transaction settlement date) at a negotiated forward rate. In the event that a security fails to settle within the normal
settlement period, the forward currency contract is renegotiated at a new rate. The gain or loss arising from the difference between the settlement value of the original and renegotiated forward contracts is isolated and is included in net realized
gains (losses) from foreign currency transactions. Risks may arise as a result of the potential inability of the counterparties to meet the terms of their contract.</FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>Forward currency contracts, when used by the Trusts, help to manage the overall exposure to the foreign currency backing some of the investments held by the Trusts. Forward currency contracts are not meant
to be used to eliminate all of the exposure to the foreign currency, rather they allow the Trusts to limit their exposure to foreign currency within a narrow band to the objectives of the Trusts. </FONT></P>
<P>
<B><FONT size=2>Foreign Currency Translation: </FONT></B><FONT size=2>Foreign currency amounts are translated into United States dollars on the following basis: </FONT></P>
<TABLE border=0 cellspacing=0 cellpadding=0>
<TR>
	<TD nowrap valign=top>
<FONT size=2>(i)</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD>
<FONT size=2>market value of investment securities, other assets and liabilities&#151;at the London 4:00 PM rates of exchange.</FONT>	</TD>
</TR>
<TR><TD colspan=2>&nbsp;</TD></TR><TR>
	<TD nowrap valign=top>
<FONT size=2>(ii)</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD>
<FONT size=2>purchases and sales of investment securities, income and expenses&#151;at the rates of exchange prevailing on the respective dates of such transactions.</FONT>	</TD>
</TR>
<TR><TD colspan=2>&nbsp;</TD></TR></TABLE>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>The Trusts isolate that portion of the results of operations arising as a result of changes in the foreign exchange rates from the fluctuations arising from changes in the market prices of securities held
at period end. Similarly, the Trusts isolate the effect of changes in foreign exchange rates from the fluctuations arising from changes in the market prices of portfolio securities sold during the period. </FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>Net realized and unrealized foreign exchange gains and losses including realized foreign exchange gains and losses from sales and maturities of foreign portfolio securities, maturities of foreign reverse
repurchase agreements, sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions, the difference between the amounts of interest and discount recorded on the Trusts&#146; books
and the U.S. dollar equivalent amounts actually received or paid and changes in unrealized foreign exchange gains and losses in the value of portfolio securities and other assets and liabilities arising as a result of changes in the exchange rate.
</FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>Foreign security and currency transactions may involve certain considerations and risks not typically associated with those of domestic origin, including unanticipated movements in the value of the foreign
currency relative to the U.S. dollar. </FONT></P>
<P>
<B><FONT size=2>Short Sales: </FONT></B><FONT size=2>The Trusts may make short sales of securities as a method of managing potential price declines in similar securities owned. When a Trust makes a short sale, it may borrow the security sold short
and deliver it to the broker-dealer through which it made the short sale as collateral for its obligation to deliver the security upon conclusion of the sale. The Trusts may have to pay a fee to borrow the particular securities and may be obligated
to pay over any payments received on such borrowed securities. A gain, limited to the price at which a Trust sold the security short, or a loss, unlimited as to dollar amount, will be recognized upon the termination of a short sale if the market
price is greater or less than the proceeds originally received. </FONT></P>
<P>
<B><FONT size=2>Security Lending: </FONT></B><FONT size=2>The Trusts may lend their portfolio securities to qualified institutions. The loans are secured by collateral at least equal, at all times, to the market value of the securities loaned. The
Trusts may bear the risk of delay in recovery of, or even loss of rights in, the securities loaned should the borrower of the securities fail financially. The Trusts receive compensation for lending their securities in the form of interest on the
loan. The Trusts also continue to receive interest on the securities loaned, and any gain or loss in the market price of the securities loaned that may occur during the term of the loan will be for the accounts of the Trusts. The Trusts did not
enter into any security lending transactions during the year ended October 31, 2004.</FONT></P>
<P>
<B><FONT size=2>Segregation: </FONT></B><FONT size=2>In cases in which the Investment Company Act of 1940, as amended, and the interpretive positions of the Securities and Exchange Commission (&#147;SEC&#148;) require that each Trust segregate
assets in connection with certain investments (e.g., when issued securities, reverse repurchase agreements or futures contracts), each Trust will, consistent with certain interpretive letters issued by the SEC, designate on its books and records
cash or other liquid debt securities having a market value at least equal to the amount that would otherwise be required to be physically segregated.</FONT></P>
<P>
<B><FONT size=2>Federal Income Taxes: </FONT></B><FONT size=2>It is each Trust&#146;s intention to continue to be treated as a regulated investment company under the Internal Revenue Code and to distribute sufficient amounts of their taxable income
to shareholders. Therefore, no Federal income tax provisions are required. As part of a tax planning strategy, Advantage and Investment Quality may retain a portion of their taxable income and pay excise tax on the undistributed amounts.</FONT></P>
<P>
<B><FONT size=2>Dividends and Distributions: </FONT></B><FONT size=2>Each Trust declares and pays dividends and distributions to common shareholders monthly from net investment income, net realized short-term capital gains and other sources, if
necessary. Net long-term capital gains, if any, in excess of loss car-ryforwards may be distributed annually. Dividends and distributions are recorded on the ex-dividend date. Income distributions and capital gain distributions are determined in
accordance with income tax regulations which may differ from accounting principles generally accepted in the United States of America.</FONT></P>
<P align="center">
<FONT size=2>67</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<A name="page_70"></A>

<P>
<B><FONT size=2>Estimates: </FONT></B><FONT size=2>The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect
the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ
from these estimates.</FONT></P>
<P>
<B><FONT size=2>Deferred Compensation and BlackRock Closed-End Share Equivalent Investment Plan: </FONT></B><FONT size=2>Under the deferred compensation plan approved by each Trust&#146;s Board, non-interested Trustees are required to defer a
portion of their annual complex-wide compensation. Deferred amounts earn an approximate return as though equivalent dollar amounts had been invested in common shares of other BlackRock closed-end funds selected by the Trustees. This has the same
economic effect for the Trustees as if the Trustees had invested the deferred amounts in such Trusts.</FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>The deferred compensation plan is not funded and obligations thereunder represent general unsecured claims against the general assets of the Trust. Each Trust may, however, elect to invest in common shares
of those Trusts selected by the Trustees in order to match its deferred compensation obligations.</FONT></P>
<P>
<B><FONT size=2>Reclassification of Capital Accounts: </FONT></B><FONT size=2>In order to present undistributed (distribution in excess of) net investment income (&#147;UNII&#148;) and accumulated net realized gain (&#147;Accumulated Gain&#148;)
more closely to its tax character, the following accounts for each Trust were increased (decreased):</FONT></P>
<TABLE border=0 cellspacing=0 cellpadding=0 width=100%>
<TR valign="bottom">
	<TD width=30% align=left>
<B><FONT size=2>Trust</FONT></B>&nbsp;
	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=12% align=center>
<B><FONT size=2>UNII</FONT></B>&nbsp;
	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=16% align=center>
<B><FONT size=2>Accumulated Gain</FONT></B>
	</TD>
	<TD width=6% align=left>&nbsp;

	</TD>
	<TD width=11% align=center>
<B><FONT size=2>PIC</FONT></B>
	</TD>
	<TD width=15% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
<HR noshade size=1 width=50% align=left></TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=30% align=left>
<FONT size=2>Broad Investment Grade</FONT>&nbsp;
	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=12% align=right>
<FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;450,216</FONT>&nbsp;
	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=16% align=right>
<FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(53,824</FONT>
	</TD>
	<TD width=6% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD width=11% align=right>
<FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(396,392</FONT>
	</TD>
	<TD width=15% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=30% align=left>
<FONT size=2>Core Bond</FONT>&nbsp;
	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=12% align=right>
<FONT size=2>1,398,658</FONT>&nbsp;
	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=16% align=right>
<FONT size=2>(1,400,207</FONT>
	</TD>
	<TD width=6% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD width=11% align=right>
<FONT size=2>1,549</FONT>
	</TD>
	<TD width=15% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=30% align=left>
<FONT size=2>High Yield</FONT>&nbsp;
	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=12% align=right>
<FONT size=2>187,188</FONT>&nbsp;
	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=16% align=right>
<FONT size=2>&#151;</FONT>
	</TD>
	<TD width=6% align=left>&nbsp;

	</TD>
	<TD width=11% align=right>
<FONT size=2>(187,188</FONT>
	</TD>
	<TD width=15% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=30% align=left>
<FONT size=2>Income Trust</FONT>&nbsp;
	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=12% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=16% align=right>
<FONT size=2>27,373,194</FONT>
	</TD>
	<TD width=6% align=left>&nbsp;

	</TD>
	<TD width=11% align=right>
<FONT size=2>(27,373,194</FONT>
	</TD>
	<TD width=15% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
</TABLE>
<BR>
<P>
<B>Note 2. Agreements</B></P>
<P>
<FONT size=2>Each Trust has an Investment Management Agreement with BlackRock Advisors, Inc. (the &#147;Advisor&#148;), which is a wholly owned subsidiary of BlackRock, Inc. BlackRock Financial Management, Inc., a wholly owned subsidiary of
BlackRock, Inc., serves as sub-advisor to Core Bond, Limited Duration and Strategic Bond.</FONT></P>
<P>
<FONT size=2>BlackRock, Inc. is an indirect, majority owned subsidiary of The PNC Financial Services Group, Inc.</FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>Broad Investment Grade, High Yield, Income Opportunity and Income Trust each have an Administration Agreement with the Advisor. The Investment Management Agreement for Core Bond, Limited Duration and
Strategic Bond covers both investment advisory and administration services.</FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>Each Trust&#146;s investment advisory fee paid to the Advisor is computed weekly and payable monthly based on an annual rate, 0.55% for Broad Investment Grade, 0.60% for Income Opportunity and 0.65% for
Income Trust, of each Trust&#146;s average net assets and 0.55% for Core Bond and Limited Duration, 1.05% for High Yield and 0.75% for Strategic Bond, of each Trust&#146;s average weekly managed assets. &#147;Managed assets&#148; means the total
assets of a Trust (including any assets attributable to any borrowing that may be outstanding) minus the sum of accrued liabilities (other than debt representing financial leverage). The Advisor has voluntarily agreed to waive a portion of the
investment advisory fees or other expenses on Strategic Bond as a percentage of its average weekly managed assets as follows: 0.20% for the first 5 years of the Trust&#146;s operations, 0.15% in year 6, 0.10% in year 7 and 0.05% in year
8.</FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>Pursuant to the agreements, the Advisor provides continuous supervision of the investment portfolio and pays the compensation of officers of each Trust who are affiliated persons of the Advisor. The Advisor
pays occupancy and certain clerical and accounting costs for each Trust. Each Trust bears all other costs and expenses, which include reimbursements to the Advisor for certain operational support services provided to each Trust.</FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>Pursuant to the terms of their custody agreements, Core Bond, High Yield, Income Opportunity, Income Trust, Limited Duration and Strategic Bond received earnings credits from its custodian for positive cash
balances maintained, which are used to offset custody fees.</FONT></P>
<P>
<B>Note 3. Portfolio Investments</B></P>
<P>
<FONT size=2>Purchases and sales of investment securities, other than short-term investments, dollar rolls and U.S. government securities, for the year ended October 31, 2004, aggregated as follows:</FONT></P>
<TABLE border=0 cellspacing=0 cellpadding=0 width=100%>
<TR valign="bottom">
	<TD width=15% align=left>
<B><FONT size=2>Trust</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<B><FONT size=2>Purchases</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=center>
<B><FONT size=2>Sales</FONT></B>&nbsp;
	</TD>
	<TD width=7%>&nbsp;
	</TD>
	<TD width=11% align=left>
<B><FONT size=2>Trust</FONT></B>&nbsp;
	</TD>
	<TD width=2% align=left>

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=13% align=center>
<B><FONT size=2>Purchases</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=center>
<B><FONT size=2>Sales</FONT></B>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>
<FONT size=2>Broad Investment Grade</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=right>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;3,971,247</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2% align=right>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;5,073,258</FONT>&nbsp;
      </div></TD>
	<TD width=7%>&nbsp;
	</TD>
	<TD width=11% align=left>
<FONT size=2>Income Trust</FONT>&nbsp;
	</TD>
	<TD width=2% align=right>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=13% align=right>
<FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;316,820,219</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=right>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;216,371,268</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>
<FONT size=2>Core Bond</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>828,465,744</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>849,608,350</FONT>&nbsp;
      </div></TD>
	<TD width=7%>&nbsp;
	</TD>
	<TD width=11% align=left>
<FONT size=2>Limited Duration</FONT>&nbsp;
	</TD>
	<TD width=2% align=left>

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=13% align=right>
<FONT size=2>2,185,323,272</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>2,151,695,068</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>
<FONT size=2>High Yield</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>95,595,516</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>94,445,448</FONT>&nbsp;
      </div></TD>
	<TD width=7%>&nbsp;
	</TD>
	<TD width=11% align=left>
<FONT size=2>Strategic Bond</FONT>&nbsp;
	</TD>
	<TD width=2% align=left>

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=13% align=right>
<FONT size=2>37,119,022</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>67,945,935</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>
<FONT size=2>Income Opportunity</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>111,315,490</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>187,879,019</FONT>&nbsp;
      </div></TD>
	<TD width=7%>&nbsp;
	</TD>
	<TD width=11% align=left>&nbsp;

	</TD>
	<TD width=2% align=left>

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=13% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2>68</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<A name="page_71"></A>

<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>Purchases and sales of U.S. government securities for the year ended October 31, 2004, aggregated as follows:</FONT></P>
<TABLE border=0 cellspacing=0 cellpadding=0 width=100%>
<TR>
	<TD colspan=11>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=17% align=left>
<B><FONT size=2>Trust</FONT></B>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
      <center>
        <B><FONT size=2>Purchases</FONT></B>&nbsp;
      </center></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=10% align=center>
<B><FONT size=2>Sales</FONT></B>&nbsp;
	</TD>
	<TD width=7%>&nbsp;
	</TD>
	<TD width=13% align=left>
<B><FONT size=2>Trust</FONT></B>&nbsp;
	</TD>
	<TD width=4%>&nbsp;
	</TD>
	<TD width=11% align=right>
      <center>
        <B><FONT size=2>Purchases</FONT></B>&nbsp;
      </center></TD>
	<TD width=8%>&nbsp;
	</TD>
	<TD width=12% align=center>
<B><FONT size=2>Sales</FONT></B>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD><HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=17% align=left>
<FONT size=2>Broad Investment Grade</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6,215,742</FONT>&nbsp;
	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3,516,882</FONT>&nbsp;
	</TD>
	<TD width=7%>&nbsp;
	</TD>
	<TD width=13% align=left>
<FONT size=2>Income Trust</FONT>&nbsp;
	</TD>
	<TD width=4%>&nbsp;
	</TD>
	<TD width=11% align=right>
<FONT size=2>$540,872,321</FONT>&nbsp;
	</TD>
	<TD width=8%>&nbsp;
	</TD>
	<TD width=12% align=right>
<FONT size=2>$496,292,198</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=17% align=left>
<FONT size=2>Core Bond</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>1,710,520,110</FONT>&nbsp;
	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>1,665,313,586</FONT>&nbsp;
	</TD>
	<TD width=7%>&nbsp;
	</TD>
	<TD width=13% align=left>
<FONT size=2>Limited Duration</FONT>&nbsp;
	</TD>
	<TD width=4%>&nbsp;
	</TD>
	<TD width=11% align=right>
<FONT size=2>86,581,859</FONT>&nbsp;
	</TD>
	<TD width=8%>&nbsp;
	</TD>
	<TD width=12% align=right>
<FONT size=2>131,886,180</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=17% align=left>
<FONT size=2>High Yield</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD width=7%>&nbsp;
	</TD>
	<TD width=13% align=left>
<FONT size=2>Strategic Bond</FONT>&nbsp;
	</TD>
	<TD width=4%>&nbsp;
	</TD>
	<TD width=11% align=right>
<FONT size=2>3,074,336</FONT>&nbsp;
	</TD>
	<TD width=8%>&nbsp;
	</TD>
	<TD width=12% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=17% align=left>
<FONT size=2>Income Opportunity</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>1,499,774,699</FONT>&nbsp;
	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>1,354,745,467</FONT>&nbsp;
	</TD>
	<TD width=7%>&nbsp;
	</TD>
	<TD width=13% align=left>&nbsp;

	</TD>
	<TD width=4%>&nbsp;
	</TD>
	<TD width=11% align=left>&nbsp;

	</TD>
	<TD width=8%>&nbsp;
	</TD>
	<TD width=12% align=left>&nbsp;

	</TD>
</TR>
</TABLE>
<BR>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>Each Trust may from time to time purchase in the secondary market certain mortgage pass-through securities packaged or master serviced by affiliates or mortgage related securities containing loans or
mortgages originated by PNC Bank or its affiliates, including Midland Loan Services, Inc., each of which is an affiliate of BlackRock Advisors, Inc. It is possible under certain circumstances, that PNC Mortgage Securities Corp. or its affiliates,
including Midland Loan Services, Inc., could have interests that are in conflict with the holders of these mortgage backed securities, and such holders could have rights against PNC Mortgage Securities Corp. or its affiliates, including Midland Loan
Services, Inc.</FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>At October 31, 2004, the total cost of securities for Federal income tax purposes and the aggregate gross unrealized appreciation and depreciation for securities held by each Trust were as
follows:</FONT></P>
<TABLE border=0 cellspacing=0 cellpadding=0 width=100%>
<TR valign="bottom">
	<TD width=19% align=left>
<B><FONT size=2>Trust</FONT></B>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=11% align=center>
<B><FONT size=2>Cost</FONT></B>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=14% align=right>
      <center>
        <B><FONT size=2>Appreciation</FONT></B>&nbsp;
      </center></TD>
	<TD width=6%>
	  <center>
    </center></TD>
	<TD width=3%>
	  <center>
    </center></TD>
	<TD width=12% align=right>
      <center>
        <B><FONT size=2>Depreciation</FONT></B>&nbsp;
      </center></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=center>
<B><FONT size=2>Net</FONT></B>
	</TD>
	<TD width=5% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>
<FONT size=2>Broad Investment Grade</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=11% align=right>
<FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;63,726,401</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=14% align=right>
<FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3,401,557</FONT>&nbsp;
	</TD>
	<TD width=6%>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=12% align=right>
<FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;956,652</FONT>&nbsp;
	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=right>
<FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2,444,905</FONT>
	</TD>
	<TD width=5% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>
<FONT size=2>Core Bond</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=11% align=right>
<FONT size=2>562,881,902</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=14% align=right>
<FONT size=2>16,861,803</FONT>&nbsp;
	</TD>
	<TD width=6%>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=12% align=right>
<FONT size=2>1,197,360</FONT>&nbsp;
	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=right>
<FONT size=2>15,664,443</FONT>
	</TD>
	<TD width=5% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>
<FONT size=2>High Yield</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=11% align=right>
<FONT size=2>75,644,796</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=14% align=right>
<FONT size=2>3,044,215</FONT>&nbsp;
	</TD>
	<TD width=6%>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=12% align=right>
<FONT size=2>10,274,163</FONT>&nbsp;
	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=right>
<FONT size=2>(7,229,948</FONT>
	</TD>
	<TD width=5% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>
<FONT size=2>Income Opportunity</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=11% align=right>
<FONT size=2>555,359,120</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=14% align=right>
<FONT size=2>21,153,280</FONT>&nbsp;
	</TD>
	<TD width=6%>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=12% align=right>
<FONT size=2>1,436,628</FONT>&nbsp;
	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=right>
<FONT size=2>19,716,652</FONT>
	</TD>
	<TD width=5% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>
<FONT size=2>Income Trust</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=11% align=right>
<FONT size=2>680,035,277</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=14% align=right>
<FONT size=2>21,451,696</FONT>&nbsp;
	</TD>
	<TD width=6%>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=12% align=right>
<FONT size=2>30,363,077</FONT>&nbsp;
	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=right>
<FONT size=2>(8,911,381</FONT>
	</TD>
	<TD width=5% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>
<FONT size=2>Limited Duration</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=11% align=right>
<FONT size=2>977,774,375</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=14% align=right>
<FONT size=2>34,251,308</FONT>&nbsp;
	</TD>
	<TD width=6%>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=12% align=right>
<FONT size=2>2,355,943</FONT>&nbsp;
	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=right>
<FONT size=2>31,895,365</FONT>
	</TD>
	<TD width=5% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>
<FONT size=2>Strategic Bond</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=11% align=right>
<FONT size=2>113,309,408</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=14% align=right>
<FONT size=2>7,108,459</FONT>&nbsp;
	</TD>
	<TD width=6%>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=12% align=right>
<FONT size=2>886,642</FONT>&nbsp;
	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=right>
<FONT size=2>6,221,817</FONT>
	</TD>
	<TD width=5% align=left>&nbsp;

	</TD>
</TR>
</TABLE>
<BR>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>For Federal income tax purposes, the following Trusts had capital loss carryforwards as of their last respective tax year end. These amounts may be used to offset future realized capital gains, if
any:</FONT></P>
<TABLE border=0 cellspacing=0 cellpadding=0 width=100%>
  <TR valign="bottom">
    <TD width=17% align=left>&nbsp;</TD>
    <TD width=3%>&nbsp;</TD>
    <TD width=15% align=right><center>
        <B><FONT size=2>Capital Loss</FONT></B>&nbsp;
    </center></TD>
    <TD width=2%>&nbsp;</TD>
    <TD width=9% align=left>&nbsp;</TD>
    <TD width=7%>&nbsp;</TD>
    <TD width=17% align=left>&nbsp;</TD>
    <TD width=3% align=left></TD>
    <TD width=15% align=center><B><FONT size=2>Capital Loss</FONT></B>&nbsp; </TD>
    <TD width=3%>&nbsp;</TD>
    <TD width=9% align=left>&nbsp;</TD>
  </TR>
  <TR valign="bottom">
    <TD width=17% align=left><B><FONT size=2>Trust</FONT></B>&nbsp; </TD>
    <TD width=3%>&nbsp;</TD>
    <TD width=15% align=center><center>
        <B><FONT size=2>Carryforward Amount</FONT></B>&nbsp;
    </center></TD>
    <TD width=2%>&nbsp;</TD>
    <TD width=9% align=center><B><FONT size=2>Expires</FONT></B>&nbsp; </TD>
    <TD width=7%>&nbsp;</TD>
    <TD width=17% align=left><B><FONT size=2>Trust</FONT></B>&nbsp; </TD>
    <TD width=3% align=left></TD>
    <TD width=15% align=center><B><FONT size=2>Carryforward Amount</FONT></B>&nbsp; </TD>
    <TD width=3%>&nbsp;</TD>
    <TD width=9% align=center><B><FONT size=2>Expires</FONT></B>&nbsp; </TD>
  </TR>
  <TR>
    <TD><HR noshade size=1>
    </TD>
    <TD></TD>
    <TD><HR noshade size=1>
    </TD>
    <TD></TD>
    <TD><HR noshade size=1>
    </TD>
    <TD></TD>
    <TD><HR noshade size=1>
    </TD>
    <TD>&nbsp;</TD>
    <TD><HR noshade size=1>
    </TD>
    <TD></TD>
    <TD><HR noshade size=1>
    </TD>
  </TR>
  <TR valign="bottom">
    <TD width=17% align=left><FONT size=2>Broad Investment Grade</FONT>&nbsp; </TD>
    <TD width=3%>&nbsp;</TD>
    <TD width=15% align=right><FONT size=2>$2,518,895</FONT>&nbsp; </TD>
    <TD width=2%>&nbsp;</TD>
    <TD width=9% align=center><FONT size=2>2011</FONT>&nbsp; </TD>
    <TD width=7%>&nbsp;</TD>
    <TD width=17% align=left><FONT size=2>Income Trust</FONT>&nbsp; </TD>
    <TD width=3% align=right>&nbsp;</TD>
    <TD width=15% align=center><div align="right"><FONT size=2>$33,107,952</FONT>&nbsp; </div></TD>
    <TD width=3%>&nbsp;</TD>
    <TD width=9% align=center><FONT size=2>2007</FONT>&nbsp; </TD>
  </TR>
  <TR>
    <TD></TD>
    <TD></TD>
    <TD><HR noshade size=2>
    </TD>
    <TD></TD>
    <TD></TD>
    <TD></TD>
    <TD></TD>
    <TD></TD>
    <TD><div align="right"><font size=2>1,352,206</font>&nbsp;</div></TD>
    <TD></TD>
    <TD align="center"><font size=2>2008</font> </TD>
  </TR>
  <TR valign="bottom">
    <TD width=17% align=left>&nbsp;</TD>
    <TD width=3%>&nbsp;</TD>
    <TD width=15% align=left>&nbsp;</TD>
    <TD width=2%>&nbsp;</TD>
    <TD width=9% align=left>&nbsp;</TD>
    <TD width=7%>&nbsp;</TD>
    <TD width=17% align=left>&nbsp;</TD>
    <TD width=3% align=left></TD>
    <TD width=15% align=center><div align="right"><font size=2>13,940,898</font>&nbsp; </div></TD>
    <TD width=3%>&nbsp;</TD>
    <TD width=9% align=center><font size=2>2009</font>&nbsp; </TD>
  </TR>
  <TR valign="bottom">
    <TD width=17% align=left><FONT size=2>High Yield</FONT>&nbsp; </TD>
    <TD width=3%>&nbsp;</TD>
    <TD width=15% align=right><FONT size=2>$3,443,603</FONT>&nbsp; </TD>
    <TD width=2%>&nbsp;</TD>
    <TD width=9% align=center><FONT size=2>2007</FONT>&nbsp; </TD>
    <TD width=7%>&nbsp;</TD>
    <TD width=17% align=left>&nbsp;</TD>
    <TD width=3% align=left></TD>
    <TD width=15% align=center><div align="right"><font size=2>21,960,613</font>&nbsp; </div></TD>
    <TD width=3%>&nbsp;</TD>
    <TD width=9% align=center><font size=2>2011</font>&nbsp; </TD>
  </TR>
  <TR valign="bottom">
    <TD width=17% align=left>&nbsp;</TD>
    <TD width=3%>&nbsp;</TD>
    <TD width=15% align=right><FONT size=2>3,270,311</FONT>&nbsp; </TD>
    <TD width=2%>&nbsp;</TD>
    <TD width=9% align=center><FONT size=2>2008</FONT>&nbsp; </TD>
    <TD width=7%>&nbsp;</TD>
    <TD width=17% align=left>&nbsp;</TD>
    <TD width=3% align=left></TD>
    <TD width=15% align=center><div align="right"><font size=2>10,279,377</font>&nbsp;</div></TD>
    <TD width=3%>&nbsp;</TD>
    <TD width=9% align=center><font size=2>2012</font>&nbsp; </TD>
  </TR>
  <TR valign="bottom">
    <TD width=17% align=left>&nbsp;</TD>
    <TD width=3%>&nbsp;</TD>
    <TD width=15% align=right><FONT size=2>15,159,280</FONT>&nbsp; </TD>
    <TD width=2%>&nbsp;</TD>
    <TD width=9% align=center><FONT size=2>2009</FONT>&nbsp; </TD>
    <TD width=7%>&nbsp;</TD>
    <TD width=17% align=left>&nbsp;</TD>
    <TD width=3% align=left></TD>
    <TD width=15% align=center><div align="right">
        <hr align="right" size=1 noshade>
    </div></TD>
    <TD width=3%>&nbsp;</TD>
    <TD width=9% align=center>&nbsp;</TD>
  </TR>
  <TR>
    <TD></TD>
    <TD></TD>
    <TD></TD>
    <TD></TD>
    <TD></TD>
    <TD></TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD align="right"><font size=2>$80,641,046</font>&nbsp; </TD>
    <TD></TD>
    <TD align="center"></TD>
  </TR>
  <TR valign="bottom">
    <TD width=17% align=left>&nbsp;</TD>
    <TD width=3%>&nbsp;</TD>
    <TD width=15% align=right><FONT size=2>8,468,860</FONT>&nbsp; </TD>
    <TD width=2%>&nbsp;</TD>
    <TD width=9% align=center><FONT size=2>2010</FONT>&nbsp; </TD>
    <TD width=7%>&nbsp;</TD>
    <TD width=17% align=left>&nbsp;</TD>
    <TD width=3% align=right>&nbsp;</TD>
    <TD width=15% align=center><div align="right">
        <hr align="right" size=2 noshade>
    </div></TD>
    <TD width=3%>&nbsp;</TD>
    <TD width=9% align=center>&nbsp;</TD>
  </TR>
  <TR>
    <TD></TD>
    <TD></TD>
    <TD></TD>
    <TD></TD>
    <TD></TD>
    <TD></TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD align="center"></TD>
  </TR>
  <TR valign="bottom">
    <TD width=17% align=left>&nbsp;</TD>
    <TD width=3%>&nbsp;</TD>
    <TD width=15% align=right><FONT size=2>4,771,417</FONT>&nbsp; </TD>
    <TD width=2%>&nbsp;</TD>
    <TD width=9% align=center><FONT size=2>2011</FONT>&nbsp; </TD>
    <TD width=7%>&nbsp;</TD>
    <TD width=17% align=left><font size=2>Strategic Bond</font>&nbsp;</TD>
    <TD width=3% align=left></TD>
    <TD width=15% align=left><div align="right"><font size=2>$432,713</font>&nbsp; </div></TD>
    <TD width=3%>&nbsp;</TD>
    <TD width=9% align=center><font size=2>2011</font>&nbsp;</TD>
  </TR>
  <TR valign="bottom">
    <TD width=17% align=left>&nbsp;</TD>
    <TD width=3%>&nbsp;</TD>
    <TD width=15% align=right><FONT size=2>316,410</FONT>&nbsp; </TD>
    <TD width=2%>&nbsp;</TD>
    <TD width=9% align=center><FONT size=2>2012</FONT>&nbsp; </TD>
    <TD width=7%>&nbsp;</TD>
    <TD width=17% align=left>&nbsp;</TD>
    <TD width=3% align=right>&nbsp;</TD>
    <TD width=15% align=center><div align="right">
        <hr noshade size=2>
    </div></TD>
    <TD width=3%>&nbsp;</TD>
    <TD width=9% align=center>&nbsp;</TD>
  </TR>
  <TR>
    <TD></TD>
    <TD></TD>
    <TD><HR noshade size=1>
    </TD>
    <TD></TD>
    <TD></TD>
    <TD></TD>
    <TD></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD></TD>
    <TD></TD>
  </TR>
  <TR valign="bottom">
    <TD width=17% align=left>&nbsp;</TD>
    <TD width=3%>&nbsp;</TD>
    <TD width=15% align=right><FONT size=2>$35,429,881</FONT>&nbsp; </TD>
    <TD width=2%>&nbsp;</TD>
    <TD width=9% align=left>&nbsp;</TD>
    <TD width=7%>&nbsp;</TD>
    <TD width=17% align=left>&nbsp;</TD>
    <TD width=3% align=left></TD>
    <TD width=15% align=left>&nbsp;</TD>
    <TD width=3%>&nbsp;</TD>
    <TD width=9% align=left>&nbsp;</TD>
  </TR>
  <TR>
    <TD></TD>
    <TD></TD>
    <TD><HR noshade size=2>
    </TD>
    <TD></TD>
    <TD></TD>
    <TD></TD>
    <TD></TD>
    <TD></TD>
    <TD></TD>
    <TD></TD>
    <TD></TD>
  </TR>
</TABLE>
<BR>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>Accordingly, no capital gain distributions are expected to be paid to shareholders of a Trust until that Trust has net realized capital gains in excess of its carryforward amounts.</FONT></P>
<P align="center">
<FONT size=2>69</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<A name="page_72"></A>

<TABLE border=0 cellspacing=0 cellpadding=0 width=100%>
<TR valign="bottom">
	<TD colspan=6 align=right>
      <div align="left"><FONT size=2>Details of open financial futures contracts at October 31, 2004 were as follows:</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=left>

	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=15% align=left>

	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=10% align=left>

	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=10% align=left>

	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=10% align=left>

	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=10% align=right>
      <center>
        <B><FONT size=2>Unrealized</FONT></B>
      </center></TD>
	<TD width=2% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=center>
      <center>
        <B><FONT size=2>Number of</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=15% align=left>

	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=10% align=center>
      <center>
        <B><FONT size=2>Expiration</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=10% align=center>
      <center>
        <B><FONT size=2>Value at</FONT></B>&nbsp;
      </center></TD>


	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=10% align=right>
      <center>
        <B><FONT size=2>Value at</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=10% align=right>
      <center>
        <B><FONT size=2>Appreciation</FONT></B>
      </center></TD>
	<TD width=2% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=center>
      <center>
        <B><FONT size=2>Contracts</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=15% align=center>
      <center>
        <B><FONT size=2>Type</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=10% align=center>
      <center>
        <B><FONT size=2>Date</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=10% align=right>
      <center>
        <B><FONT size=2>Trade Date</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD align=left><center>
	  <B><FONT size=2>October 31, 2004</FONT></B>&nbsp;
    </center></TD>
	<TD width="2%" align=left><center>
    </center></TD>
	<TD align=left><center>
    <B><FONT size=2>(Depreciation)</FONT></B>	  </center></TD>
	<TD width=2% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD width="20%">
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD width="2%">
	</TD>
	<TD width="15%">
<HR noshade size=1>
	</TD>
	<TD width="2%">
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
<HR noshade size=1>
	</TD>
	<TD width="2%">
	</TD>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
	<TD width="2%">
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>
<B><FONT size=2>Long Position:</FONT></B>&nbsp;
	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>
<FONT size=2>Broad Investment Grade</FONT>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>53</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>10 Yr. U.S. T-Note</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Dec &#146;04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5,902,127</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6,018,813</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;116,687</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>5</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>30 Yr. U.S. T-Bond</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Dec &#146;04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>551,808</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>569,219</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>17,411</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
  <TD align=left>&nbsp;</TD>
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=right><HR noshade size=1></TD>
  <TD align=left>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>134,098</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD width="20%">
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD width="15%">
	</TD>
	<TD width="2%">
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
<HR noshade size=2>
	</TD>
	<TD width="2%">&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>
<FONT size=2>Core Bond</FONT>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>254</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>10 Yr. U.S. T-Bond</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Dec. &#146;04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>28,510,852</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>28,844,875</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>334,023</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>698</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>30 Yr. U.S. T-Bond</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Dec. &#146;04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>77,219,379</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>79,462,938</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>2,243,559</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>12</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Bond</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Dec. &#146;04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>1,696,757</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>1,714,403</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>17,646</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD width="20%">
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD width="15%">
	</TD>
	<TD width="2%">
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
<HR noshade size=1>
	</TD>
	<TD width="2%">&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>2,595,228</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD width="20%">
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD width="15%">
	</TD>
	<TD width="2%">
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
<HR noshade size=2>
	</TD>
	<TD width="2%">&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>
<FONT size=2>Income Opportunity</FONT>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>1,933</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>10 Yr. U.S. T-Note</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Dec. &#146;04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>215,579,060</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>219,516,313</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>3,937,253</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD width="20%">
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD width="15%">
	</TD>
	<TD width="2%">
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
<HR noshade size=2>
	</TD>
	<TD width="2%">&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>
<FONT size=2>Income Trust</FONT>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>390</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>10 Yr. U.S. T-Note</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Dec. &#146;04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>43,429,835</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>44,289,375</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>859,540</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD width="20%">
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD width="15%">
	</TD>
	<TD width="2%">
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
<HR noshade size=2>
	</TD>
	<TD width="2%">&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>
<B><FONT size=2>Short Position:</FONT></B>&nbsp;
	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>
<FONT size=2>Core Bond</FONT>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>1,456</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>5 Yr. U.S. T-Note</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Dec. &#146;04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>160,295,568</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>162,162,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(1,866,432</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>35</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Dec. &#146;04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>8,546,849</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>8,546,563</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>286</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>35</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Mar. &#146;05</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>8,528,894</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>8,528,625</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>269</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>35</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>June &#146;05</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>8,512,878</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>8,513,313</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(435</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>41</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Sept. &#146;05</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>9,944,630</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>9,954,800</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(10,170</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>38</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Dec. &#146;05</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>9,197,700</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>9,206,925</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(9,225</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>38</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Mar. &#146;06</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>9,179,244</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>9,190,300</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(11,056</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>38</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>June &#146;06</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>9,163,194</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>9,174,625</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(11,431</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>32</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Sept. &#146;06</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>7,712,999</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>7,714,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(1,001</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>25</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Dec. &#146;06</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>6,016,298</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>6,017,500</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(1,202</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>25</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Mar. &#146;07</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>6,008,484</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>6,009,688</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(1,204</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>25</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>June &#146;07</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>6,000,672</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>6,001,875</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(1,203</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>25</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Sep. &#146;07</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>5,993,422</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>5,994,375</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(953</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD width="20%">
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD width="15%">
	</TD>
	<TD width="2%">
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
<HR noshade size=1>
	</TD>
	<TD width="2%">&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(1,913,757</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD width="20%">
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD width="15%">
	</TD>
	<TD width="2%">
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
<HR noshade size=2>
	</TD>
	<TD width="2%">&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>
<FONT size=2>Income Opportunity</FONT>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>798</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>5 Yr. U.S. T-Note</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Dec. &#146;04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>88,299,451</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>88,877,250</FONT>&nbsp;
	</TD>

	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(577,799</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>25</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>30 Yr. U.S. T-Bond</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Dec. &#146;04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>2,758,929</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>2,846,094</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(87,165</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>35</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Mar. &#146;05</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>8,528,894</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>8,528,625</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>269</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>35</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>June &#146;05</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>8,512,878</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>8,513,313</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(435</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>35</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Sept. &#146;05</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>8,495,479</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>8,498,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(2,521</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>32</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Dec. &#146;05</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>7,752,899</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>7,753,200</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(301</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>32</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Mar. &#146;06</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>7,737,699</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>7,739,200</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(1,501</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>32</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>June &#146;06</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>7,724,499</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>7,726,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(1,501</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>32</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Sept. &#146;06</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>7,712,999</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>7,714,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(1,001</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>25</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Dec. &#146;06</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>6,016,297</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>6,017,500</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(1,203</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>25</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Mar. &#146;07</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>6,008,484</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>6,009,688</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(1,204</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>25</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>June &#146;07</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>6,000,672</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>6,001,875</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(1,203</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>25</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Sep. &#146;07</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>5,993,422</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>5,994,375</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(953</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>35</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Dec. &#146;04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>8,546,849</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>8,546,563</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>286</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD width="20%">
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD width="15%">
	</TD>
	<TD width="2%">
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
<HR noshade size=1>
	</TD>
	<TD width="2%">&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(676,232</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD width="20%">
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD width="15%">
	</TD>
	<TD width="2%">
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
<HR noshade size=2>
	</TD>
	<TD width="2%">&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>
<FONT size=2>Income Trust</FONT>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>44</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>5 Yr. U.S. T-Note</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Dec. &#146;04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>4,850,559</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>4,900,500</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(49,941</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>816</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>30 Yr. U.S. T-Bond</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Dec. &#146;04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>90,371,330</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>92,896,500</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(2,525,200</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>54</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Dec. &#146;04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>13,174,311</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>13,186,126</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(11,815</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>54</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Mar. &#146;05</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>13,144,276</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>13,158,450</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(14,174</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>54</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>June &#146;05</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>13,116,599</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>13,134,826</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(18,227</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>54</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Sept. &#146;05</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>13,088,448</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>13,111,200</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(22,752</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>49</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Dec. &#146;05</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>11,851,290</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>11,872,088</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(20,798</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>49</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Mar. &#146;06</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>11,827,265</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>11,850,650</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(23,385</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>39</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Sept. &#146;06</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>9,400,189</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>9,401,438</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(1,249</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>30</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Dec. &#146;06</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>7,219,555</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>7,221,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(1,445</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>30</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Mar. &#146;07</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>7,210,180</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>7,211,625</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(1,445</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>69</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>June &#146;07</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>16,615,019</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>16,618,313</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(3,294</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>
<FONT size=2>30</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
<FONT size=2>Euro Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
<FONT size=2>Sep. &#146;07</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>7,192,105</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>7,193,250</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>(1,145</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD width="20%">
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD width="15%">
	</TD>
	<TD width="2%">
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
<HR noshade size=1>
	</TD>
	<TD width="2%">&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>$&nbsp;&nbsp;&nbsp;(2,694,870</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD width="20%">
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD width="15%">
	</TD>
	<TD width="2%">
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
<HR noshade size=2>
	</TD>
	<TD width="2%">&nbsp;
	</TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2>70</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<A name="page_73"></A>

<TABLE border=0 cellspacing=0 cellpadding=0 width=100%>
<TR valign="bottom">
	<TD colspan=13 align=left>
<FONT size=2>Details of open forward currency contracts in Core Bond at October 31, 2004, were as follows:</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=11% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=left>

	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=11% align=right>
      <center>
        <B><FONT size=2>Contract to</FONT></B>
      </center></TD>
	<TD width=3% align=left>

	  <center>
    </center></TD>
	<TD width=2% align=left>

	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=11% align=center>
      <center>
        <B><FONT size=2>Value at</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=17% align=left>

	  <center>
    </center></TD>
	<TD width=1%>
	  <center>
    </center></TD>
	<TD width=1%>
	  <center>
    </center></TD>
	<TD width=11% align=left>

	  <center>
    </center></TD>
	<TD width=2% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=right>
      <center>
        <B><FONT size=2>Settlement</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=11% align=right>
      <center>
        <B><FONT size=2>Purchase/</FONT></B>
      </center></TD>
	<TD width=3% align=left>

	  <center>
    </center></TD>
	<TD width=2% align=left>

	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=11% align=center>
      <center>
        <B><FONT size=2>Settlement</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=17% align=center>
      <center>
        <B><FONT size=2>Value at</FONT></B>&nbsp;
      </center></TD>
	<TD width=1%>
	  <center>
    </center></TD>
	<TD width=1%>
	  <center>
    </center></TD>
	<TD width=11% align=right>
      <center>
        <B><FONT size=2>Unrealized</FONT></B>
      </center></TD>
	<TD width=2% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>
<B><FONT size=2>Foreign Currency</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=center>
      <center>
        <B><FONT size=2>Date</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=11% align=right>
      <center>
        <B><FONT size=2>Receive</FONT></B>
      </center></TD>
	<TD width=3% align=left>

	  <center>
    </center></TD>
	<TD width=2% align=left>

	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=11% align=center>
      <center>
        <B><FONT size=2>Date</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=17% align=center>
      <center>
        <B><FONT size=2>October 31, 2004</FONT></B>&nbsp;
      </center></TD>
	<TD width=1%>
	  <center>
    </center></TD>
	<TD width=1%>
	  <center>
    </center></TD>
	<TD width=11% align=right>
      <center>
        <B><FONT size=2>(Depreciation)</FONT></B>
      </center></TD>
	<TD width=2% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>
<B><FONT size=2>Sold:</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=left>

	</TD>
	<TD width=3% align=left>&nbsp;

	</TD>
	<TD width=2% align=left>

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=17% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=11% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>
<FONT size=2>Canadian Dollar</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=right>
      <center>
        <FONT size=2>1/28/05</FONT>&nbsp;
      </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;5,042,391</FONT>
      </div></TD>
	<TD width=3% align=left>

	  <div align="right"></div></TD>
	<TD width=2% align=right>
      <div align="right">
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;4,109,662</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=17% align=center>
      <div align="right"><FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;4,128,024</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;(18,362</FONT>
      </div></TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>
<FONT size=2>Euro</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=right>
      <center>
        <FONT size=2>1/25/05</FONT>&nbsp;
      </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>16,291,125&#128;</FONT>
      </div></TD>
	<TD width=3% align=left>
      <div align="right"><FONT size=2></FONT>&nbsp;
      </div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>20,531,705</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=17% align=center>
      <div align="right"><FONT size=2>20,719,146</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>(187,441</FONT>
      </div></TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>
<FONT size=2>Swedish Krona</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=right>
      <center>
        <FONT size=2>1/21/05</FONT>&nbsp;
      </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>30,907,864kr</FONT>
      </div></TD>
	<TD width=3% align=left>
      <div align="right"><FONT size=2></FONT>&nbsp;
      </div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>4,254,773</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=17% align=center>
      <div align="right"><FONT size=2>4,345,065</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>(90,292</FONT>
      </div></TD>
	<TD width=2% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
  <TD></TD>
  <TD></TD>
  <TD></TD>
  <TD></TD>
  <TD></TD>
  <TD></TD>
  <TD></TD>
  <TD></TD>
  <TD></TD>
  <TD></TD>
  <TD></TD>
  <TD></TD>
  <TD></TD>
  <TD></TD>
  <TD></TD>
  <TD><HR noshade size=1></TD>
  <TD>&nbsp;</TD>
</TR>
<TR>
  <TD></TD>
  <TD></TD>
  <TD></TD>
  <TD></TD>
  <TD></TD>
  <TD></TD>
  <TD></TD>
  <TD></TD>
  <TD></TD>
  <TD></TD>
  <TD></TD>
  <TD></TD>
  <TD></TD>
  <TD></TD>
  <TD></TD>
  <TD valign="bottom"><div align="right"><FONT size=2>$(296,095</FONT> </div></TD>
  <TD valign="bottom"><FONT size=2>)</FONT>&nbsp; </TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD><HR noshade size=2>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
</TABLE>
<BR>
<P>
<FONT size=2>Income Trust held one interest rate floor. Under the agreement, Income Trust pays the excess, if any, of a fixed rate over a floating rate. Income Trust received a transaction fee for the floor. Transaction fees are amortized through
the termination of the agreement. Details of the interest rate floor held at October 31, 2004 were as follows:</FONT></P>
<TABLE border=0 cellspacing=0 cellpadding=0 width=100%>
<TR valign="bottom">
	<TD colspan=7 align=left>
<FONT size=2></FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=left>

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=12% align=left>

	</TD>
	<TD width=0% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=11% align=right>
      <center>
        <B><FONT size=2>Notional</FONT></B>
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=11% align=left>

	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=18% align=left>

	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=14% align=left>

	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=11% align=left>

	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=11% align=left>
 &nbsp; &nbsp;
 <center>
   <B><FONT size=2>Value at</FONT></B>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=12% align=left>

	  <center>
    </center></TD>
	<TD width=0% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=11% align=right>
      <center>
        <B><FONT size=2>Amount</FONT></B>
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=11% align=center>
      <center>
        <B><FONT size=2>Variable</FONT></B>
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=18% align=left>
      <center>
        <B><FONT size=2>Floating</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=14% align=center>
      <center>
        <B><FONT size=2>Termination</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=11% align=right><center>
    <B><FONT size=2>Amortized</FONT></B>	  </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=11% align=right>
      <center>
        <B><FONT size=2>October 31,</FONT></B>
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=12% align=center>
      <center>
        <B><FONT size=2>Unrealized</FONT></B>
      </center></TD>
	<TD width=0% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=11% align=right><center>
        <B><FONT size=2>(000)</FONT></B>
	    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=11% align=center>
      <center>
        <B><FONT size=2>Rate</FONT></B>
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=18% align=center>
      <center>
        <B><FONT size=2>Rate</FONT></B>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=14% align=left>
 <center>
   <B><FONT size=2>Date</FONT></B>&nbsp;
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=11% align=right>
      <center>
        <B><FONT size=2>Cost</FONT></B>
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=11% align=right>
      <center>
        <B><FONT size=2>2004</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=12% align=center>
      <center>
        <B><FONT size=2>Depreciation</FONT></B>
      </center></TD>
	<TD width=0% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD width="11%">
<HR align="center" size=1 noshade>
	</TD>
	<TD width="2%">
	  <center>
    </center></TD>
	<TD width="11%">
<HR align="center" size=1 noshade>
	</TD>
	<TD width="2%">
	  <center>
    </center></TD>
	<TD width="18%">
<HR align="center" size=1 noshade>
	</TD>
	<TD width="2%">
	  <center>
    </center></TD>
	<TD width="14%">
<HR align="center" size=1 noshade>
	</TD>
	<TD width="2%">
	  <center>
    </center></TD>
	<TD width="11%">
<HR align="center" size=1 noshade>
	</TD>
	<TD width="2%">
	  <center>
    </center></TD>
	<TD width="11%">
<HR align="center" size=1 noshade>
	</TD>
	<TD width="2%">
	  <center>
    </center></TD>
	<TD width="12%">
<HR align="center" size=1 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=11% align=right>
      <center>
        <FONT size=2>$11,000</FONT>
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=11% align=right>
      <center>
        <FONT size=2>4.04875%</FONT>
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=18% align=center>
      <center>
        <FONT size=2>1-month LIBOR</FONT>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=14% align=left>
 &nbsp; &nbsp;
 <center>
   <FONT size=2>1/25/05</FONT>&nbsp;
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=11% align=right>
      <center>
        <FONT size=2>$(59,625</FONT>)
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=11% align=left>
      <center>
        <FONT size=2>$(68,890)</FONT>
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=12% align=right>
      <center>
        <FONT size=2>$(9,265)</FONT>
      </center></TD>
	<TD width=0% align=left>&nbsp;</TD>
</TR>
<TR>
	<TD width="11%">
	  <center>
    </center></TD>
	<TD width="2%">
	  <center>
    </center></TD>
	<TD width="11%">
	  <center>
    </center></TD>
	<TD width="2%">
	  <center>
    </center></TD>
	<TD width="18%">
	  <center>
    </center></TD>
	<TD width="2%">
	  <center>
    </center></TD>
	<TD width="14%">
	  <center>
    </center></TD>
	<TD width="2%">
	  <center>
    </center></TD>
	<TD width="11%">
<HR align="center" size=2 noshade>
	</TD>
	<TD width="2%">
	  <center>
    </center></TD>
	<TD width="11%">
<HR align="center" size=2 noshade>
	</TD>
	<TD width="2%">
	  <center>
    </center></TD>
	<TD width="12%">
<HR align="center" size=2 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
</TABLE>
<p></p>
<TABLE border=0 cellspacing=0 cellpadding=0 width=100%>
<TR valign="bottom">
  <TD colspan="8"><FONT size=2>Details of open interest rate swaps at October 31, 2004 were as follows:</FONT>&nbsp; </TD>
  <TD>&nbsp;</TD>
  <TD align=center>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD colspan=4 align=right>&nbsp;</TD>
  <TD align=left>&nbsp;</TD>
</TR>
<TR valign="bottom">
  <TD width=2%>&nbsp;</TD>
  <TD width=15% align=left></TD>
  <TD width=2% align=left>&nbsp;</TD>
  <TD width=10% align=right>&nbsp;</TD>
  <TD width=2%>&nbsp;</TD>
  <TD width=10% align=center>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=right>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=center>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD colspan=4 align=right>&nbsp;</TD>
  <TD align=left>&nbsp;</TD>
</TR>
<TR valign="bottom">
  <TD width=2%>&nbsp;</TD>
  <TD width=15% align=left></TD>
  <TD width=2% align=left>&nbsp;</TD>
  <TD width=10% align=right><center>
    <B><FONT size=2>Notional</FONT></B>  </center></TD>
  <TD width=2%>&nbsp;</TD>
  <TD width=10% align=center>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD width=14% align=right>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD width=11% align=center>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD colspan=4 align=right><center>
    <B><FONT size=2>Unrealized</FONT></B>  </center></TD>
  <TD align=left>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>      <center>
          <B><FONT size=2>Amount</FONT></B>
    </center></TD>
	<TD width=2%>      <center>
    </center></TD>
	<TD width=10% align=center>      <center>
        <B><FONT size=2>Fixed</FONT></B>&nbsp;
    </center></TD>
	<TD width=2%>      <center>
    </center></TD>
	<TD width=14% align=right>      <center>
        <B><FONT size=2>Floating</FONT></B>&nbsp;
    </center></TD>
	<TD width=2%>      <center>
    </center></TD>
	<TD width=11% align=center>      <center>
        <B><FONT size=2>Termination</FONT></B>&nbsp;
    </center></TD>
	<TD width=5%>      <center>
    </center></TD>
	<TD colspan=4 align=right>      <center>
          <B><FONT size=2>Appreciation</FONT></B>
    </center></TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>
<B><FONT size=2>Trust</FONT></B>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=10% align=right>      <center>
          <B><FONT size=2>(000)</FONT></B>
    </center></TD>
	<TD width=2%>      <center>
    </center></TD>
	<TD width=10% align=center>      <center>
        <B><FONT size=2>Rate</FONT></B>&nbsp;
    </center></TD>
	<TD width=2%>      <center>
    </center></TD>
	<TD width=14% align=left>
<center>
     <B><FONT size=2>Rate</FONT></B>&nbsp;
    </center></TD>
	<TD width=2%>      <center>
    </center></TD>
	<TD width=11% align=right>      <center>
          <B><FONT size=2>Date</FONT></B>
    </center></TD>
	<TD width=5%>      <center>
    </center></TD>
	<TD colspan=4 align=right>      <center>
      <B><FONT size=2>(Depreciation)</FONT></B>
    </center></TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD width="2%">
	</TD>
	<TD width="15%">
<HR noshade size=1>
	</TD>
	<TD width="2%">&nbsp;
	</TD>
	<TD width="10%">
<HR noshade size=1>
	</TD>
	<TD width="2%">
	</TD>
	<TD width="10%">
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD width="14%">
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD width="11%">
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD colspan=4>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=2>Core Bond</FONT>
    </div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>$19,435</FONT>
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>3.215%(a)</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>6/14/06</FONT>
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD colspan=4 align=right>
      <div align="right"><FONT size=2>$&nbsp;329,815</FONT>
    </div></TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	  <div align="right"></div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>14,300</FONT>
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>3.21%(a)</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>6/17/06</FONT>
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD colspan=4 align=right>
      <div align="right"><FONT size=2>239,246</FONT>
    </div></TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	  <div align="right"></div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>25,000</FONT>
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>2.635%(a)</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>8/14/06</FONT>
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD colspan=4 align=left>
      <div align="right"><FONT size=2>(36,715</FONT>
    </div></TD>
	<TD width=9% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	  <div align="right"></div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>6,500</FONT>
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>3.556%(a)</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>1/21/07</FONT>
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD colspan=4 align=right>
      <div align="right"><FONT size=2>59,859</FONT>
    </div></TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	  <div align="right"></div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>50,000</FONT>
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>3.00%(b)</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>4/16/07</FONT>
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD colspan=4 align=right>
      <div align="right"><FONT size=2>47,600</FONT>
    </div></TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	  <div align="right"></div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>5,700</FONT>
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>3.52%(a)</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>9/26/08</FONT>
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD colspan=4 align=right>
      <div align="right"><FONT size=2>21,600</FONT>
    </div></TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	  <div align="right"></div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>5,400</FONT>
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>4.412%(b)</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>2/17/14</FONT>
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD colspan=4 align=left>
      <div align="right"><FONT size=2>(41,380</FONT>
    </div></TD>
	<TD width=9% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	  <div align="right"></div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>7,100</FONT>
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>4.508%(b)</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>10/1/14</FONT>
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD colspan=4 align=left>
      <div align="right"><FONT size=2>(48,683</FONT>
    </div></TD>
	<TD width=9% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	  <div align="right"></div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>41,200</FONT>
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>4.51%(b)</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>10/29/14</FONT>
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD colspan=4 align=left>
      <div align="right"><FONT size=2>(174,414</FONT>
    </div></TD>
	<TD width=9% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	  <div align="right"></div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>950</FONT>
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>5.365%(b)</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>7/29/19</FONT>
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD colspan=4 align=left>
      <div align="right"><FONT size=2>(68,330</FONT>
    </div></TD>
	<TD width=9% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	  <div align="right"></div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>1,300</FONT>
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>5.155%(a)</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>8/13/19</FONT>
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD colspan=4 align=right>
      <div align="right"><FONT size=2>50,597</FONT>
    </div></TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	  <div align="right"></div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>800</FONT>
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>4.78%(a)</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>10/27/19</FONT>
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD colspan=4 align=left>
      <div align="right"><FONT size=2>(6,601</FONT>
    </div></TD>
	<TD width=9% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD width="2%">
	</TD>
	<TD width="15%">
	  <div align="right"></div></TD>
	<TD width="2%">
	  <div align="right"></div></TD>
	<TD width="10%">
	  <div align="right"></div></TD>
	<TD width="2%">
	  <div align="right"></div></TD>
	<TD width="10%">
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD width="14%">
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD width="11%">
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD colspan=4>
<HR align="right" size=1 noshade>
	</TD>
	<TD>&nbsp;   	</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	  <div align="right"></div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=10% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=14% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=left>

	  <div align="right"></div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD colspan=4 align=right>
      <div align="right"><FONT size=2>372,594</FONT>
    </div></TD>
	<TD width=9% align=left>&nbsp;


	</TD>
</TR>
<TR>
	<TD width="2%">
	</TD>
	<TD width="15%">
	  <div align="right"></div></TD>
	<TD width="2%">
	  <div align="right"></div></TD>
	<TD width="10%">
	  <div align="right"></div></TD>
	<TD width="2%">
	  <div align="right"></div></TD>
	<TD width="10%">
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD width="14%">
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD width="11%">
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD colspan=4>
<HR align="right" size=2 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=center>
      <div align="left"><FONT size=2>Income Opportunity</FONT>
      </div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>20,735</FONT>
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>3.215%(a)</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>6/14/06</FONT>
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD colspan=4 align=right>
      <div align="right"><FONT size=2>351,877</FONT>
    </div></TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	  <div align="right"></div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>15,300</FONT>
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>3.21%(a)</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>6/17/06</FONT>
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD colspan=4 align=right>
      <div align="right"><FONT size=2>255,977</FONT>
    </div></TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	  <div align="right"></div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>50,000</FONT>
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>2.635%(a)</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>8/14/06</FONT>
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD colspan=4 align=left>
      <div align="right"><FONT size=2>(73,429</FONT>
    </div></TD>
	<TD width=9% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	  <div align="right"></div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>7,100</FONT>
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>3.556%(a)</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>1/21/07</FONT>
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD colspan=4 align=right>
      <div align="right"><FONT size=2>65,384</FONT>
    </div></TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	  <div align="right"></div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>48,000</FONT>
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>3.50%(a)</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>2/2/07</FONT>
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD colspan=4 align=right>
      <div align="right"><FONT size=2>368,792</FONT>
    </div></TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	  <div align="right"></div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>50,000</FONT>
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>3.00%(b)</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>4/16/07</FONT>
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD colspan=4 align=right>
      <div align="right"><FONT size=2>47,600</FONT>
    </div></TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	  <div align="right"></div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>8,000</FONT>
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>3.52%(a)</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>9/26/08</FONT>
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD colspan=4 align=right>
      <div align="right"><FONT size=2>30,316</FONT>
    </div></TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	  <div align="right"></div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>5,700</FONT>
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>4.412%(b)</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>2/17/14</FONT>
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD colspan=4 align=left>
      <div align="right"><FONT size=2>(43,679</FONT>
    </div></TD>
	<TD width=9% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	  <div align="right"></div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>7,700</FONT>
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>4.508%(b)</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>10/1/14</FONT>
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD colspan=4 align=left>
      <div align="right"><FONT size=2>(52,796</FONT>
    </div></TD>
	<TD width=9% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	  <div align="right"></div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>27,500</FONT>
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>4.399%(b)</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>10/25/14</FONT>
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD colspan=4 align=right>
      <div align="right"><FONT size=2>115,005</FONT>
    </div></TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	  <div align="right"></div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>13,800</FONT>
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>4.51%(b)</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>10/29/14</FONT>
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD colspan=4 align=left>
      <div align="right"><FONT size=2>(58,420</FONT>
    </div></TD>
	<TD width=9% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	  <div align="right"></div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>1,050</FONT>
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>5.365%(b)</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>7/29/19</FONT>
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD colspan=4 align=left>
      <div align="right"><FONT size=2>(75,522</FONT>
    </div></TD>
	<TD width=9% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	  <div align="right"></div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>1,400</FONT>
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>5.155%(a)</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>8/13/19</FONT>
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD colspan=4 align=right>
      <div align="right"><FONT size=2>54,490</FONT>
    </div></TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	  <div align="right"></div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>900</FONT>
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>4.78%(a)</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>10/27/19</FONT>
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD colspan=4 align=left>
      <div align="right"><FONT size=2>(7,426</FONT>
    </div></TD>
	<TD width=9% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	  <div align="right"></div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>7,000</FONT>
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=center>
      <div align="right"><FONT size=2>5.23%(b)</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=right>
      <div align="right"><FONT size=2>11/4/21</FONT>
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD colspan=4 align=left>
      <div align="right"><FONT size=2>(376,506</FONT>
    </div></TD>
	<TD width=9% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD width="2%">
	</TD>
	<TD width="15%">
	  <div align="right"></div></TD>
	<TD width="2%">
	  <div align="right"></div></TD>
	<TD width="10%">
	  <div align="right"></div></TD>
	<TD width="2%">
	  <div align="right"></div></TD>
	<TD width="10%">
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD width="14%">
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD width="11%">
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD colspan=4>
<HR align="right" size=1 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	  <div align="right"></div></TD>
	<TD width=2% align=left>

	  <div align="right"></div></TD>
	<TD width=10% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=14% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=left>

	  <div align="right"></div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD colspan=4 align=right>
      <div align="right"><FONT size=2>$&nbsp;601,663</FONT>
    </div></TD>
	<TD width=9% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD width="2%">
	</TD>
	<TD width="15%">
	  <div align="right"></div></TD>
	<TD width="2%">
	  <div align="right"></div></TD>
	<TD width="10%">
	  <div align="right"></div></TD>
	<TD width="2%">
	  <div align="right"></div></TD>
	<TD width="10%">
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD width="14%">
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD width="11%">
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD colspan=4>
<HR align="right" size=2 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2>71</FONT></P>
<hr noshade size=3>
<PAGE>

<TABLE border=0 cellspacing=0 cellpadding=0 width=100%>
<TR valign="bottom">
	<TD width=15% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=13% align=right>
      <center>
        <B><FONT size=2>Notional</FONT></B>
      </center></TD>
	<TD width=1% align=left>

	  <center>
    </center></TD>
	<TD width=1%>
	  <center>
    </center></TD>

	<TD width=11% align=left>

	  <center>
    </center></TD>
	<TD width=1%>
	  <center>
    </center></TD>
	<TD width=16% align=left>

	  <center>
    </center></TD>
	<TD width=1%>
	  <center>
    </center></TD>
	<TD width=11% align=left>

	  <center>
    </center></TD>
	<TD width=1%>
	  <center>
    </center></TD>
	<TD width=1% align=left>

	  <center>
    </center></TD>
	<TD width=1%>
	  <center>
    </center></TD>
	<TD width=13% align=right>
      <center>
        <B><FONT size=2>Unrealized</FONT></B>
      </center></TD>
	<TD width=11% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=13% align=right>
      <center>
        <B><FONT size=2>Amount</FONT></B>
      </center></TD>
	<TD width=1% align=left>

	  <center>
    </center></TD>
	<TD width=1%>
	  <center>
    </center></TD>
	<TD width=11% align=center>
      <center>
        <B><FONT size=2>Fixed</FONT></B>&nbsp;
      </center></TD>
	<TD width=1%>
	  <center>
    </center></TD>
	<TD width=16% align=center>
      <center>
        <B><FONT size=2>Floating</FONT></B>&nbsp;
      </center></TD>
	<TD width=1%>
	  <center>
    </center></TD>
	<TD width=11% align=center>
      <center>
        <B><FONT size=2>Termination</FONT></B>&nbsp;
      </center></TD>
	<TD width=1%>
	  <center>
    </center></TD>
	<TD width=1% align=left>

	  <center>
    </center></TD>
	<TD width=1%>
	  <center>
    </center></TD>
	<TD width=13% align=right>
      <center>
        <B><FONT size=2>Appreciation</FONT></B>
      </center></TD>
	<TD width=11% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>
<B><FONT size=2>Trust</FONT></B>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=13% align=right>
      <center>
        <B><FONT size=2>(000)</FONT></B>
      </center></TD>
	<TD width=1% align=left>
      <center>
        &nbsp;
      </center></TD>
	<TD width=1%>
	  <center>
    </center></TD>
	<TD width=11% align=center>
      <center>
        <B><FONT size=2>Rate</FONT></B>&nbsp;
      </center></TD>
	<TD width=1%>
	  <center>
    </center></TD>
	<TD width=16% align=center>
      <center>
        <B><FONT size=2>Rate</FONT></B>&nbsp;
      </center></TD>
	<TD width=1%>
	  <center>
    </center></TD>
	<TD width=11% align=center>
      <center>
        <B><FONT size=2>Date</FONT></B>&nbsp;
      </center></TD>
	<TD width=1%>
	  <center>
    </center></TD>
	<TD width=1% align=left>

	  <center>
    </center></TD>
	<TD width=1%>
	  <center>
    </center></TD>
	<TD width=13% align=right>
      <center>
        <B><FONT size=2>(Depreciation)</FONT></B>
      </center></TD>
	<TD width=11% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>
<FONT size=2>Income Trust</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>22,295</FONT>
      </div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>3.215%(a)</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=16% align=center>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>6/14/06</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=1% align=right>
	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;378,351</FONT>
      </div></TD>
	<TD width=11% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>16,400</FONT>
      </div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>3.21%(a)</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=16% align=center>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>6/17/06</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>274,381</FONT>
      </div></TD>
	<TD width=11% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>50,000</FONT>
      </div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>2.635%(a)</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=16% align=center>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>8/14/06</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>(73,429</FONT>
      </div></TD>
	<TD width=11% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>24,000</FONT>
      </div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>3.55%(a)</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=16% align=center>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>10/26/06</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>304,731</FONT>
      </div></TD>
	<TD width=11% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>7,300</FONT>
      </div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>3.556%(a)</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=16% align=center>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>1/21/07</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>67,226</FONT>
      </div></TD>
	<TD width=11% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>50,000</FONT>
      </div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>3.00%(b)</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=16% align=center>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>4/16/07</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>47,600</FONT>
      </div></TD>
	<TD width=11% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>11,200</FONT>
      </div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>3.52%(a)</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=16% align=center>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>9/26/08</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>42,442</FONT>
      </div></TD>
	<TD width=11% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>19,000</FONT>
      </div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>4.889%(b)</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=16% align=center>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>4/22/14</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>(743,383</FONT>
      </div></TD>
	<TD width=11% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>17,000</FONT>
      </div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>5.307%(b)</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=16% align=center>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>6/14/14</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>(1,515,307</FONT>
      </div></TD>
	<TD width=11% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>7,700</FONT>
      </div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>4.508%(b)</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=16% align=center>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>10/1/14</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>(52,797</FONT>
      </div></TD>
	<TD width=11% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>12,500</FONT>
      </div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>4.399%(b)</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=16% align=center>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>10/25/14</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>52,275</FONT>
      </div></TD>
	<TD width=11% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>2,800</FONT>
      </div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>5.94%(a)</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=16% align=center>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>12/7/15</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>240,352</FONT>
      </div></TD>
	<TD width=11% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>1,075</FONT>
      </div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>5.365%(b)</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=16% align=center>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>7/29/19</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>(77,320</FONT>
      </div></TD>
	<TD width=11% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>1,450</FONT>
      </div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>5.155%(a)</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=16% align=center>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>8/13/19</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>56,436</FONT>
      </div></TD>
	<TD width=11% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>900</FONT>
      </div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>4.78%(a)</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=16% align=center>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>10/27/19</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>(7,427</FONT>
      </div></TD>
	<TD width=11% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>25,000</FONT>
      </div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>5.23%(b)</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=16% align=center>
      <div align="right"><FONT size=2>3-month LIBOR</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>8/15/23</FONT>&nbsp;
      </div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>(882,485</FONT>
      </div></TD>
	<TD width=11% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>&nbsp;
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
<HR align="right" size=1 noshade>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=13% align=left>

	  <div align="right"></div></TD>
	<TD width=1% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=16% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=11% align=left>

	  <div align="right"></div></TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=1% align=right>&nbsp;</TD>
	<TD width=1%>
	  <div align="right"></div></TD>
	<TD width=13% align=right>
      <div align="right"><FONT size=2>$(1,888,354</FONT>
      </div></TD>
	<TD width=11% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD colspan=10 align=left>
<FONT size=2>Details of open total return swaps at October 31, 2004 were as follows:</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=11% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=1% align=left>

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=13% align=left>

	</TD>
	<TD width=11% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=17>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>
<FONT size=2>Core Bond</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=1% align=right>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=13% align=right>
<FONT size=2>$7,210</FONT>
	</TD>
	<TD width=1% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>8.50%(a)</FONT>&nbsp;
      </div></TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD align=left>
      <div align="right"><FONT size=2>1-month LIBOR +0.70%</FONT>&nbsp;
      </div></TD>
	<TD align=left>&nbsp;</TD>
	<TD align=left><div align="right"><font size=2> 1/31/05</font></div></TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=1% align=right>&nbsp;
</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=13% align=right>
<FONT size=2>$71,822</FONT>
	</TD>
	<TD width=11% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD colspan=3>
	</TD>
	<TD>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
</TABLE>
<BR>
<TABLE border=0 cellspacing=0 cellpadding=0 width=100%>
<TR>
	<TD width="3%" valign=top nowrap>
<FONT size=1>(a)</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD width="97%">
<FONT size=1>Trust pays floating interest rate and receives fixed rate.</FONT>	</TD>
</TR>
<TR>
	<TD nowrap valign=top>
<FONT size=1>(b)</FONT>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD>
<FONT size=1>Trust pays fixed interest rate and receives floating rate.</FONT>	</TD>
</TR>
<TR><TD colspan=2>&nbsp;</TD></TR></TABLE>
<TABLE border=0 cellspacing=0 cellpadding=0 width=100%>
<TR valign="bottom">
	<TD colspan="2" align=center>
      <div align="left"><FONT size=2>Transaction in options written during the year ended October 31, 2004, were as follows:</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	</TD>
	<TD width=10% align=left>

	</TD>
	<TD width=5% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	</TD>
	<TD width=9% align=left>

	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD colspan="2" align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD colspan="2" align=left>
      <center>
        <B><FONT size=2>Contracts/</FONT></B>
      </center></TD>
	<TD width=5% align=left>

	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=2% align=left>

	  <center>
    </center></TD>
	<TD width=9% align=left>

	  <center>
    </center></TD>
	<TD width=7% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD colspan="2" align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD colspan="2" align=left>
      <center>
        <B><FONT size=2>Notional Amount</FONT></B>
      </center></TD>
	<TD width=5% align=left>

	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=2% align=left>

	  <center>
    </center></TD>
	<TD width=9% align=right>
      <center>
        <B><FONT size=2>Premium</FONT></B>
      </center></TD>
	<TD width=7% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD colspan="2" align=left>
<B><FONT size=2>Trust</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD colspan="2" align=left>
      <center>
        <B><FONT size=2>(000)</FONT></B>
      </center></TD>
	<TD width=5% align=left>
      <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=2% align=left>

	  <center>
    </center></TD>
	<TD width=9% align=right>
      <center>
        <B><FONT size=2>Received</FONT></B>
      </center></TD>
	<TD width=7% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan="2">
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD><hr noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD colspan="2" align=left>
<FONT size=2>Core Bond</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	</TD>
	<TD width=10% align=left>

	</TD>
	<TD width=5% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	</TD>
	<TD width=9% align=left>

	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;
	</TD>
	<TD width=41% align=left><FONT size=2>Options outstanding at October 31, 2003</FONT></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD width=10% align=right>
<FONT size=2>105,708</FONT>
	</TD>
	<TD width=5% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD width=9% align=right>
<FONT size=2>2,069,401</FONT>
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;
	</TD>
	<TD align=left><FONT size=2>Options written</FONT></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	  <div align="left"></div></TD>
	<TD width=10% align=right>
<FONT size=2>412,048</FONT>
	</TD>
	<TD width=5% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	  <div align="left"></div></TD>
	<TD width=9% align=right>
<FONT size=2>3,748,789</FONT>
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>
 &nbsp;&nbsp;
	</TD>
	<TD align=left><FONT size=2>Options expired</FONT></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	  <div align="left"></div></TD>
	<TD width=10% align=right>
<FONT size=2>(44</FONT>
	</TD>
	<TD width=5% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	  <div align="left"></div></TD>
	<TD width=9% align=right>
<FONT size=2>(49,424</FONT>
	</TD>
	<TD width=7% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;
	</TD>
	<TD align=left><FONT size=2>Options terminated in closing purchase transactions</FONT></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	  <div align="left"></div></TD>
	<TD width=10% align=right>
<FONT size=2>(366,012</FONT>
	</TD>
	<TD width=5% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	  <div align="left"></div></TD>
	<TD width=9% align=right>
<FONT size=2>(3,572,323</FONT>
	</TD>
	<TD width=7% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan="2">
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;
	</TD>
	<TD align=left><FONT size=2>Options outstanding at October 31, 2004</FONT></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD width=10% align=right>
<FONT size=2>151,700</FONT>
	</TD>
	<TD width=5% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD width=9% align=right>
<FONT size=2>2,196,443</FONT>
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan="2">
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=2 noshade>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=2 noshade>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD colspan="2" align=left>
<FONT size=2>Income Opportunity</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	  <div align="left"></div></TD>
	<TD width=10% align=left>

	</TD>
	<TD width=5% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	  <div align="left"></div></TD>
	<TD width=9% align=left>

	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;
	</TD>
	<TD align=left><FONT size=2>Options outstanding at October 31, 2003</FONT></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD width=10% align=right>
<FONT size=2>123,340</FONT>
	</TD>
	<TD width=5% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD width=9% align=right>
<FONT size=2>2,432,578</FONT>
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;
	</TD>
	<TD align=left><FONT size=2>Options written</FONT></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	  <div align="left"></div></TD>
	<TD width=10% align=right>
<FONT size=2>136,601</FONT>
	</TD>
	<TD width=5% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	  <div align="left"></div></TD>
	<TD width=9% align=right>
<FONT size=2>2,978,163</FONT>
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;
	</TD>
	<TD align=left><FONT size=2>Options expired</FONT></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	  <div align="left"></div></TD>
	<TD width=10% align=right>
<FONT size=2>(55</FONT>
	</TD>
	<TD width=5% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	  <div align="left"></div></TD>
	<TD width=9% align=right>
<FONT size=2>(56,565</FONT>
	</TD>
	<TD width=7% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;
	</TD>
	<TD align=left><FONT size=2>Options terminated in closing purchase transactions</FONT></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	  <div align="left"></div></TD>
	<TD width=10% align=right>
<FONT size=2>(82,486</FONT>
	</TD>
	<TD width=5% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	  <div align="left"></div></TD>
	<TD width=9% align=right>
<FONT size=2>(2,796,556</FONT>
	</TD>
	<TD width=7% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan="2">
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;
	</TD>
	<TD align=left><FONT size=2>Options outstanding at October 31, 2004</FONT></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD width=10% align=right>
<FONT size=2>177,400</FONT>
	</TD>
	<TD width=5% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD width=9% align=right>
<FONT size=2>2,557,620</FONT>
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan="2">
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=2 noshade>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=2 noshade>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD colspan="2" align=left>
<FONT size=2>Income Trust</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	  <div align="left"></div></TD>
	<TD width=10% align=left>

	</TD>
	<TD width=5% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	  <div align="left"></div></TD>
	<TD width=9% align=left>

	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;
	</TD>
	<TD align=left><FONT size=2>Options outstanding at October 31, 2003</FONT></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD width=10% align=right>
<FONT size=2>150,485</FONT>
	</TD>
	<TD width=5% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD width=9% align=right>
<FONT size=2>3,054,224</FONT>
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;
	</TD>
	<TD align=left><FONT size=2>Options written</FONT></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	  <div align="left"></div></TD>
	<TD width=10% align=right>
<FONT size=2>560,202</FONT>
	</TD>
	<TD width=5% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	  <div align="left"></div></TD>
	<TD width=9% align=right>
<FONT size=2>6,363,817</FONT>
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;
	</TD>
	<TD align=left><FONT size=2>Options expired</FONT></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	  <div align="left"></div></TD>
	<TD width=10% align=right>
<FONT size=2>(95</FONT>
	</TD>
	<TD width=5% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	  <div align="left"></div></TD>
	<TD width=9% align=right>
<FONT size=2>(97,703</FONT>
	</TD>
	<TD width=7% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;
	</TD>
	<TD align=left><FONT size=2>Options terminated in closing purchase transactions</FONT></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	  <div align="left"></div></TD>
	<TD width=10% align=right>
<FONT size=2>(527,792</FONT>
	</TD>
	<TD width=5% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=left>

	  <div align="left"></div></TD>
	<TD width=9% align=right>
<FONT size=2>(6,404,672</FONT>
	</TD>
	<TD width=7% align=left>
<FONT size=2>)</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan="2">
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD align=left>&nbsp;
	</TD>
	<TD align=left><FONT size=2>Options outstanding at October 31, 2004</FONT></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD width=10% align=right>
<FONT size=2>182,800</FONT>
	</TD>
	<TD width=5% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2% align=right>
      <div align="left"><FONT size=2>$</FONT>
      </div></TD>
	<TD width=9% align=right>
<FONT size=2>2,915,666</FONT>
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan="2">
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=2 noshade>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="left" size=2 noshade>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
	<TD>&nbsp;
	</TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2>72</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<A name="page_75"></A>

<P>
<B>Note 4. Borrowings</B></P>
<P>
<B><FONT size=2>Reverse Repurchase Agreements: </FONT></B><FONT size=2>The Trusts may enter into reverse repurchase agreements with qualified third-party broker-dealers as determined by and under the direction of the Trusts&#146; Board. Interest on
the value of reverse repurchase agreements issued and outstanding is based upon competitive market rates at the time of issuance. At the time a Trust enters into a reverse repurchase agreement, it will establish and maintain a segregated account with the lender, containing liquid investment grade securities having a value not less than the repurchase price, including
accrued interest of the reverse repurchase agreement. Details of open reverse repurchase agreements at October 31, 2004 were as follows (please see Corresponding Underlying Collateral Chart on pages 74-75):</FONT></P>
<TABLE border=0 cellspacing=0 cellpadding=0 width=100%>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	  <center>
    </center></TD>
	<TD width=2% align=left>

	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=7% align=right>
      <center>
        <B><FONT size=2>Trade</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=8% align=center>
      <center>
        <B><FONT size=2>Maturity</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=9% align=right>
      <center>
        <B><FONT size=2>Net Closing</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=7% align=left>

	  <center>
    </center></TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>
<B><FONT size=2>Trust/Counter Party</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
      <center>
        <B><FONT size=2>Rate</FONT></B>
      </center></TD>
	<TD width=2% align=left>

	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=7% align=right>
      <center>
        <B><FONT size=2>Date</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=8% align=center>
      <center>
        <B><FONT size=2>Date</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=9% align=right>
      <center>
        <B><FONT size=2>Amount</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=7% align=center>
      <center>
        <B><FONT size=2>Par</FONT></B>&nbsp;
      </center></TD>
</TR>
<TR>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>
<FONT size=2>Broad Investment Grade</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>
 &nbsp; &nbsp;<FONT size=2>Credit Suisse First Boston LLC</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.75</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/18/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/16/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>$19,288,718</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>$19,262,500</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR>
	<TD colspan=14>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>
<FONT size=2>Core Bond</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>
 &nbsp; &nbsp;<FONT size=2>Credit Suisse First Boston LLC</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.76</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/26/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/5/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>30,766,653</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>30,751,619</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.75</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/26/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/5/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>10,460,382</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10,455,300</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.80</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/26/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/5/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>7,173,585</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>7,170,000</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>48,376,919</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>
 &nbsp; &nbsp;<FONT size=2>Lehman Brothers</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.75</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/25/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/5/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>22,618,463</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>22,606,375</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.65</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/27/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/5/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>5,939,862</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>5,937,413</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.82</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/27/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/5/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>2,216,883</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>2,215,875</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.80</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/28/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/5/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>16,145,536</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>16,139,080</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.85</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/29/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/8/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>7,202,012</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>7,198,312</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>54,097,055</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>
<FONT size=2>Income Opportunity</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>
 &nbsp; &nbsp;<FONT size=2>Credit Suisse First Boston LLC</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.75</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/18/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/4/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>47,008,321</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>46,971,788</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.70</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/18/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/4/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>16,330,830</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>16,318,500</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>63,290,288</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>
 &nbsp; &nbsp;<FONT size=2>Lehman Brothers</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.87</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/29/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/2/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>4,073,971</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>4,073,125</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.55</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/20/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/4/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>400,759</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>400,500</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.55</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/21/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/4/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>601,112</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>600,750</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.65</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/26/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/4/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>1,104,205</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>1,103,750</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.68</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/25/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/5/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>2,426,745</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>2,425,500</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.75</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/29/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/5/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>22,757,741</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>22,750,000</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>31,353,625</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>
<FONT size=2>Income Trust</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>
 &nbsp; &nbsp;<FONT size=2>Credit Suisse First Boston LLC</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.36</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/28/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/1/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>59,136,185</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>59,127,250</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.78</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/19/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/2/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>43,997,185</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>43,966,750</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.72</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/18/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/4/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>43,112,182</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>43,079,250</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.45</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/29/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/8/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>3,264,189</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>3,262,875</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>149,436,125</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>
 &nbsp; &nbsp;<FONT size=2>Lehman Brothers</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.75</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/20/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/4/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>6,036,398</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>6,032,000</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.72</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/21/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/4/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>312,959</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>312,750</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.15</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/27/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/5/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>20,811,982</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>20,806,000</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.85</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/12/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/10/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>7,539,219</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>7,528,000</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.85</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/14/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/10/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>2,692,444</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>2,688,714</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.90</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/19/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/15/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>36,984,628</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>36,932,000</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>74,299,464</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>
<FONT size=2>Limited Duration</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>
 &nbsp; &nbsp;<FONT size=2>Credit Suisse First Boston LLC</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.95</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/19/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/18/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>23,099,977</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>23,062,500</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>
 &nbsp; &nbsp;<FONT size=2>Lehman Brothers</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.85</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/29/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/2/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>2,150,442</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>2,150,000</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.75</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/26/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/5/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>32,783,129</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>32,767,200</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.70</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/26/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/5/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>3,465,167</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>3,463,531</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.82</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/26/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/5/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>20,197,706</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>20,187,500</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>2.20</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/19/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/10/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>4,711,326</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>4,705,000</FONT>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.85</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/20/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/16/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>656,910</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>656,000</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>2.20</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/19/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/18/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>72,556,777</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>72,424,000</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>136,353,231</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>
<FONT size=2>Strategic Bond</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>
 &nbsp; &nbsp;<FONT size=2>Lehman Brothers</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.75</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/26/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/16/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>1,489,056</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>1,487,538</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.78</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/26/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/16/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>1,793,948</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>1,792,088</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>1.70</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/26/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/16/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>946,767</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>945,828</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>2.00</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/28/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/17/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>2,599,886</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>2,597,000</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>2.00</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/18/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/18/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>5,352,603</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>5,343,400</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>2.25</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10/29/04</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=center>
      <div align="right"><FONT size=2>11/18/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>1,023,278</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>1,022,000</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>$13,187,854</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=29% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=15% align=right>
<FONT size=2>73</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
</TR>
</TABLE>
<BR>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<A name="page_76"></A>

<TABLE border=0 cellspacing=0 cellpadding=0 width=100%>
<TR valign="bottom">
	<TD colspan=9 align=left>
<FONT size=2>Details of underlying collateral for open reverse repurchase agreements at October 31, 2004 were as follows:</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=left>&nbsp;

	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>&nbsp;

	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=left>

	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=7% align=left>

	  <center>
    </center></TD>
	<TD width=2% align=left>

	  <center>
    </center></TD>
	<TD width=9% align=center>
      <center>
        <B><FONT size=2>Maturity</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=9% align=right>
      <center>
        <B><FONT size=2>Original</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=8% align=center>
      <center>
        <B><FONT size=2>Current</FONT></B>&nbsp;
      </center></TD>
	<TD width=3%>
	  <center>
    </center></TD>
	<TD width=10% align=left>

	  <center>
        <B><FONT size=2>Market</FONT></B>&nbsp;          </center></TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=center>
<B><FONT size=2>Trust / Counter Party</FONT></B>&nbsp;
	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=center>
      <center>
        <B><FONT size=2>Description</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=7% align=right>
      <center>
        <B><FONT size=2>Rate</FONT></B>
      </center></TD>
	<TD width=2% align=left>

	  <center>
    </center></TD>
	<TD width=9% align=center>
      <center>
        <B><FONT size=2>Date</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=9% align=center>
      <center>
        <B><FONT size=2>Face</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=8% align=center>
      <center>
        <B><FONT size=2>Face</FONT></B>&nbsp;
      </center></TD>
	<TD width=3%>
	  <center>
    </center></TD>
	<TD width=10% align=right>
      <center>
        <B><FONT size=2>Value</FONT></B>&nbsp;
      </center></TD>
</TR>
<TR>
	<TD width="19%">
<HR noshade size=1>
	</TD>
	<TD width="5%">
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD width="2%">&nbsp;
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD width="2%">
	</TD>
	<TD width="9%">
<HR noshade size=1>
	</TD>
	<TD width="2%">
	</TD>
	<TD width="8%">
<HR noshade size=1>
	</TD>
	<TD width="3%">
	</TD>
	<TD width="10%">
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=center>
      <div align="left"><FONT size=2>Broad Investment Grade</FONT>&nbsp;
      </div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=left>&nbsp;

	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD colspan=2 align=left>
 <div align="left"><FONT size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Credit Suisse First Boston LLC</FONT>&nbsp;
    </div></TD>
	<TD width=22% align=center>
      <center>
        <FONT size=2>U.S. Treasury Bonds Strip</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>0.00</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>11/15/09</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>$23,000,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>$23,000,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>$19,334,605</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=2>
	  <div align="left"></div></TD>
	<TD>
	  <center>
    </center></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD width="2%">
	</TD>
	<TD width="9%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="8%">
	</TD>
	<TD width="3%">
	</TD>
	<TD width="10%">
<HR noshade size=1>
	</TD>
</TR>
<TR>
	<TD colspan=13>

	  <div align="left"></div></TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>
      <div align="left"><FONT size=2>Core Bond</FONT>&nbsp;
      </div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=left>

	  <center>
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=left>&nbsp;

	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD colspan=2 align=left>
 <div align="left"><FONT size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Credit Suisse First Boston LLC</FONT>&nbsp;
    </div></TD>
	<TD width=22% align=center>
      <center>
        <FONT size=2>U.S. Treasury Bonds</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10.375</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>11/15/12</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>4,770,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>4,770,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>5,792,941</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=center>
      <center>
        <FONT size=2>U.S. Treasury Bonds</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>12.00</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>8/18/13</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>3,170,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>3,170,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>4,178,440</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=center>
      <center>
        <FONT size=2>U.S. Treasury Bonds</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>6.00</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>2/15/26</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>3,860,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>3,860,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>4,455,135</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=center>
      <center>
        <FONT size=2>U.S. Treasury Bonds</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>6.75</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>8/15/26</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>8,960,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>8,960,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>11,260,901</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=center>
      <center>
        <FONT size=2>U.S. Treasury Bonds</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>6.125</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>11/15/27</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>3,695,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>3,695,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>4,342,770</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=center>
      <center>
        <FONT size=2>U.S. Treasury Notes</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>2.50</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>5/31/06</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>5,770,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>5,770,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>5,775,424</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=center>
      <center>
        <FONT size=2>U.S. Treasury Notes</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>2.75</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>6/30/06</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>4,545,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>4,545,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>4,566,998</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>


	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=left>
      <center>
        <FONT size=2>Federal Home Loan Mortgage Corp.</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>6.88</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>9/15/10</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>310,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>310,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>358,695</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=left>
 &nbsp;
 <center>
   <FONT size=2>Federal National Mortgage Assoc.</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>1.80</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>6/15/10</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>6,000,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>6,000,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>6,998,160</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD width="19%">
	  <div align="left"></div></TD>
	<TD width="5%">
	</TD>
	<TD>
	  <center>
    </center></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD width="2%">
	</TD>
	<TD width="9%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="8%">
	</TD>
	<TD width="3%">
	</TD>
	<TD width="10%">
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=left>

	  <center>
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=left>&nbsp;

	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>47,729,464</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD width="19%">
	  <div align="left"></div></TD>
	<TD width="5%">
	</TD>
	<TD>
	  <center>
    </center></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD width="2%">
	</TD>
	<TD width="9%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="8%">
	</TD>
	<TD width="3%">
	</TD>
	<TD width="10%">
<HR noshade size=2>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>
 <div align="left"><FONT size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Lehman Brothers</FONT>&nbsp;
    </div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=center>
      <center>
        <FONT size=2>U.S. Treasury Notes</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>2.375</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>8/31/06</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>22,550,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>22,550,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>22,493,625</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=center>
      <center>
        <FONT size=2>U.S. Treasury Notes</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>2.50</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>9/30/06</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>5,930,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>5,930,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>5,923,513</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=left>
      <center>
        <FONT size=2>Federal Home Loan Mortgage Corp.</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>7.00</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>3/15/10</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>1,900,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>1,900,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>2,191,973</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=center>
      <center>
        <FONT size=2>U.S. Treasury Bonds</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10.375</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>11/15/12</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>6,458,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>6,458,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>7,842,937</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=center>
      <center>
        <FONT size=2>U.S. Treasury Notes</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>2.50</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>5/31/06</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>7,100,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>7,100,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>7,106,674</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=center>
      <center>
        <FONT size=2>U.S. Treasury Notes</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>2.00</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>7/15/14</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>804,200</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>804,200</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>832,098</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=left>
      <center>
        <FONT size=2>Federal Home Loan Mortgage Corp.</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>4.75</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>12/8/10</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>2,795,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>2,795,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>2,835,863</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=left>
 &nbsp;
 <center>
   <FONT size=2>Federal National Mortgage Assoc.</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>2.35</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>4/5/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>3,675,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>3,675,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>3,599,185</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=left>
 &nbsp;
 <center>
   <FONT size=2>Federal National Mortgage Assoc.</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>4.75</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>2/21/13</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>700,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>700,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>697,613</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD width="19%">
	  <div align="left"></div></TD>
	<TD width="5%">
	</TD>
	<TD>
	  <center>
    </center></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD width="2%">
	</TD>
	<TD width="9%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="8%">
	</TD>
	<TD width="3%">
	</TD>
	<TD width="10%">
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=left>

	  <center>
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=left>&nbsp;

	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>53,523,481</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD width="19%">
	  <div align="left"></div></TD>
	<TD width="5%">
	</TD>
	<TD>
	  <center>
    </center></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD width="2%">
	</TD>
	<TD width="9%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="8%">
	</TD>
	<TD width="3%">
	</TD>
	<TD width="10%">
<HR noshade size=2>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=center>
      <div align="left"><FONT size=2>Income Opportunity</FONT>&nbsp;
      </div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=left>

	  <center>
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=left>&nbsp;

	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD colspan=2 align=left>
 <div align="left"><FONT size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Credit Suisse First Boston LLC</FONT>&nbsp;
    </div></TD>
	<TD width=22% align=center>
      <center>
        <FONT size=2>U.S. Treasury Bonds</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>8.125</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>8/15/19</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>7,110,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>7,110,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>9,891,788</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=center>
      <center>
        <FONT size=2>U.S. Treasury Bonds</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>6.00</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>2/15/26</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>32,000,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>32,000,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>36,933,760</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=center>
      <center>
        <FONT size=2>U.S. Treasury Bonds</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>4.75</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>5/15/14</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>15,180,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>15,180,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>16,052,850</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD width="19%">
	  <div align="left"></div></TD>
	<TD width="5%">
	</TD>
	<TD>
	  <center>
    </center></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD width="2%">
	</TD>
	<TD width="9%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="8%">
	</TD>
	<TD width="3%">
	</TD>
	<TD width="10%">
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=left>

	  <center>
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=left>&nbsp;

	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>62,878,398</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD width="19%">
	  <div align="left"></div></TD>
	<TD width="5%">
	</TD>
	<TD>
	  <center>
    </center></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD width="2%">
	</TD>
	<TD width="9%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="8%">
	</TD>
	<TD width="3%">
	</TD>
	<TD width="10%">
<HR noshade size=2>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>
 <div align="left"><FONT size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Lehman Brothers</FONT>&nbsp;
    </div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=left>
      <center>
        <FONT size=2>Federal Home Loan Mortgage Corp.</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>6.875</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>9/15/10</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>3,500,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>3,500,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>4,049,780</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=center>
      <center>
        <FONT size=2>U.S. Treasury Bonds</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>2.50</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>9/30/06</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>400,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>400,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>399,624</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=center>
      <center>
        <FONT size=2>U.S. Treasury Bonds</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>2.50</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>9/30/06</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>600,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>600,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>599,436</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=center>
      <center>
        <FONT size=2>U.S. Treasury Bonds</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>5.375</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>2/15/31</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>1,000,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>1,000,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>1,086,560</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=center>
      <center>
        <FONT size=2>U.S. Treasury Bonds</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>5.375</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>2/15/31</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>2,200,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>2,200,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>2,390,432</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=center>
      <center>
        <FONT size=2>U.S. Treasury Bonds</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>5.375</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>2/15/31</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>20,800,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>20,800,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>22,600,448</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD width="19%">
	  <div align="left"></div></TD>
	<TD width="5%">
	</TD>
	<TD>
	  <center>
    </center></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD width="2%">
	</TD>
	<TD width="9%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="8%">
	</TD>
	<TD width="3%">
	</TD>
	<TD width="10%">
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=left>

	  <center>
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=left>&nbsp;

	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>31,126,280</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD width="19%">
	  <div align="left"></div></TD>
	<TD width="5%">
	</TD>
	<TD>
	  <center>
    </center></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD width="2%">
	</TD>
	<TD width="9%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="8%">
	</TD>
	<TD width="3%">
	</TD>
	<TD width="10%">
<HR noshade size=2>
	</TD>
</TR>
<TR valign="bottom">
	<TD colspan=2 align=left>
 <div align="left"><FONT size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Union Bank of Switzerland</FONT>&nbsp;
    </div></TD>
	<TD width=22% align=center>
      <center>
        <FONT size=2>U.S. Treasury Notes</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>2.50</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>5/31/06</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>300,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>300,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>300,282</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=2>
	  <div align="left"></div></TD>
	<TD>
	  <center>
    </center></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD width="2%">
	</TD>
	<TD width="9%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="8%">
	</TD>
	<TD width="3%">
	</TD>
	<TD width="10%">
<HR noshade size=1>
	</TD>
</TR>
<TR>
	<TD colspan=13>

	  <div align="left"></div></TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>
      <div align="left"><FONT size=2>Income Trust</FONT>&nbsp;
      </div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=left>

	  <center>
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=left>&nbsp;

	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD colspan=2 align=left>
 <div align="left"><FONT size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Credit Suisse First Boston LLC</FONT>&nbsp;
    </div></TD>
	<TD width=22% align=center>
      <center>
        <FONT size=2>U.S. Treasury Notes</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>1.50</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>3/31/06</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>59,800,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>59,800,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>59,099,144</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=center>
      <center>
        <FONT size=2>U.S. Treasury Bonds Strip</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>4.00</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>5/31/06</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>123,850,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>123,850,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>44,794,440</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=center>
      <center>
        <FONT size=2>U.S. Treasury Notes</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>4.00</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>5/31/06</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>42,600,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>42,600,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>42,640,044</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=center>
      <center>
        <FONT size=2>U.S. Treasury Notes</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>1.50</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>3/31/06</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>3,300,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>3,300,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>3,261,324</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD width="19%">
	  <div align="left"></div></TD>
	<TD width="5%">
	</TD>
	<TD>
	  <center>
    </center></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD width="2%">
	</TD>
	<TD width="9%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="8%">
	</TD>
	<TD width="3%">
	</TD>
	<TD width="10%">
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=left>

	  <center>
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=left>&nbsp;

	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>149,794,952</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD width="19%">
	  <div align="left"></div></TD>
	<TD width="5%">
	</TD>
	<TD>
	  <center>
    </center></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD width="2%">
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD width="2%">
	</TD>
	<TD width="9%">
	</TD>
	<TD width="2%">
	</TD>
	<TD width="8%">
	</TD>
	<TD width="3%">
	</TD>
	<TD width="10%">
<HR noshade size=2>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>
 <div align="left"><FONT size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Lehman Brothers</FONT>&nbsp;
    </div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=center>
      <center>
        <FONT size=2>U.S. Treasury Notes</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>4.25</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>11/15/13</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>5,800,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>5,800,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>5,919,654</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=center>
      <center>
        <FONT size=2>U.S. Treasury Notes</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>4.25</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>11/15/13</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>300,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>300,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>306,189</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=center>
      <center>
        <FONT size=2>U.S. Treasury Notes</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>4.25</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>8/15/14</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>20,200,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>20,200,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>20,553,500</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=left>
      <center>
        <FONT size=2>Federal Home Loan Mortgage Corp.</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>3.08</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>5/1/17</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>500,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>140,836</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>146,030</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=left>
 &nbsp;
 <center>
   <FONT size=2>Federal National Mortgage Assoc.</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>3.00</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>5/1/31</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>48,673,696</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>4,180,545</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>4,402,616</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=left>
 &nbsp;
 <center>
   <FONT size=2>Federal National Mortgage Assoc.</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>3.00</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>1/1/32</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>18,452,625</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>3,001,451</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>3,185,290</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD align=left>

	  <center>
    </center>
      <center>
        <FONT size=2>Resolution Funding Corp.</FONT>&nbsp;
      </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>3.00</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>4/15/30</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>10,500,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>10,500,000</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>2,749,950</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=left>
 &nbsp;
 <center>
   <FONT size=2>Federal National Mortgage Assoc.</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>3.11</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>10/1/31</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>30,429,402</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>4,755,168</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>5,046,422</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=left>
 &nbsp;
 <center>
   <FONT size=2>Federal National Mortgage Assoc.</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>3.10</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>8/1/32</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>24,000,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>5,690,704</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>5,905,869</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=left>
 &nbsp;
 <center>
   <FONT size=2>Federal National Mortgage Assoc.</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>3.11</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>10/1/32</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>11,667,065</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>4,665,209</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>4,841,601</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=left>
 &nbsp;
 <center>
   <FONT size=2>Federal National Mortgage Assoc.</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>3.11</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>6/1/33</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>5,999,400</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>5,513,501</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>5,511,860</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=19% align=left>

	  <div align="left"></div></TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=22% align=left>
 &nbsp;
 <center>
   <FONT size=2>Federal National Mortgage Assoc.</FONT>&nbsp;
    </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>3.10</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=9% align=center>
      <div align="right"><FONT size=2>7/1/34</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=9% align=right>
<FONT size=2>4,600,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=8% align=right>
<FONT size=2>4,498,157</FONT>&nbsp;
	</TD>
	<TD width=3%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>4,487,219</FONT>&nbsp;
	</TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2>74</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<A name="page_77"></A>

<TABLE border=0 cellspacing=0 cellpadding=0 width=100%>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
<B><FONT size=2>Maturity</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=center>
<B><FONT size=2>Original</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=center>
<B><FONT size=2>Current</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left><center>
    <B><FONT size=2>Market</FONT></B>&nbsp;	</center></TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>
<B><FONT size=2>Trust / Counter Party</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<B><FONT size=2>Description</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<B><FONT size=2>Rate</FONT></B>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
<B><FONT size=2>Date</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=center>
<B><FONT size=2>Face</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=center>
<B><FONT size=2>Face</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
      <center>
        <B><FONT size=2>Value</FONT></B>&nbsp;
      </center></TD>
</TR>
<TR>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>
<FONT size=2>Income Trust (cont&#146;d)</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>
<FONT size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Lehman Brothers (cont&#146;d)</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>Federal National Mortgage Assoc.</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>3.11</FONT>
	</TD>
	<TD width=2% align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>9/1/17</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>$30,215,381</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>$11,876,010</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>$12,302,834</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>75,359,034</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>
<FONT size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Union Bank of Switzerland</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>U.S. Treasury Notes</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>4.375</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>8/15/12</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>300,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>300,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>311,343</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR>
	<TD colspan=17>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>
<FONT size=2>Limited Duration</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
  <TD align=left>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>Credit Suisse First </FONT></TD>
  <TD align=left>&nbsp;</TD>
  <TD align=center>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=right>&nbsp;</TD>
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=center>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=center>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=right>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=right>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left><FONT size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Boston LLC </FONT></TD>
	<TD width=2% align=left>&nbsp;</TD>
	<TD width=19% align=center><FONT size=2>Ford Motor Credit Co.</FONT>&nbsp; </TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>7.375</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>2/1/11</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>7,500,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>7,500,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>8,135,963</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>General Motors Acceptance Corp.</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>6.875</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>8/28/12</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>7,500,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>7,500,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>7,766,250</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>Weyerhaeuser Co.</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>5.25</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>12/15/09</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>7,500,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>7,500,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>7,907,655</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>23,809,868</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>Lehman Brothers</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>U.S. Treasury Notes</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>3.375</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>12/15/08</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>17,000,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>17,000,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>17,172,720</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>U.S. Treasury Notes</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>3.875</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>5/15/09</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>6,000,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>6,000,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>6,167,820</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>U.S. Treasury Notes</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>4.25</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>11/15/13</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>8,660,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>8,660,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>8,838,656</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>U.S. Treasury Notes</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>3.375</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>9/15/09</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>3,425,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>3,425,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>3,438,906</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>Federal National Mortgage Assoc.</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>7.25</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>1/15/10</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>17,000,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>17,000,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>19,807,380</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>Allied Waste NA</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>10.00</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>8/1/09</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>5,000,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>5,000,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>5,225,000</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>Federal National Mortgage Assoc.</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>5.50</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>10/1/33</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>800,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>663,591</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>676,452</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>AES Corp.</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>8.75</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>5/15/13</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>5,500,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>5,500,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>6,331,874</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>Concentra Operating Corp.</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>9.50</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>8/15/10</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>4,500,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>4,500,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>4,983,750</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>CSC Holdings, Inc.</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>7.875</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>12/15/07</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>4,800,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>4,800,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>5,160,000</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>DaimlerChrysler NA</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>4.05</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>6/4/08</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>7,500,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>7,500,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>7,532,475</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>Deutsche Telekom Intl.</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>8.50</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>6/15/10</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>2,200,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>2,200,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>2,647,942</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>Dynegy Holdings, Inc.</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>10.125</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>7/15/13</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>4,300,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>4,300,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>5,009,500</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>JPMorgan HYDI B</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>9.00</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>6/20/08</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>10,000,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>9,814,815</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10,305,556</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>JPMorgan HYDI BB</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>6.40</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>6/20/08</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>10,000,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10,000,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>10,150,000</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>National Waterworks, Inc.</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>10.50</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>12/1/12</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>6,250,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>6,250,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>7,000,000</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>Peru Republic</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>9.125</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>2/21/12</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>5,000,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>5,000,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>5,600,000</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>Qwest Corp.</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>9.125</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>3/15/12</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>6,000,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>6,000,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>6,765,000</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>Structured Asset Receivable Trust</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>1.649</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>1/21/10</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>6,500,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>6,474,858</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>6,464,741</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>Tyco Intl. Group</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>6.125</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>11/1/08</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>6,600,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>6,600,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>7,167,930</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>146,445,702</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>

	  <div align="right"></div></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>
<FONT size=2>Strategic Bond</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>Lehman Brothers</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>U.S. Treasury Bonds</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>5.375</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>2/15/31</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>410,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>410,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>445,490</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>U.S. Treasury Notes</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>4.25</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>8/15/13</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>1,000,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>1,000,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>1,022,340</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>U.S. Treasury Notes</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>2.50</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>5/31/06</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>1,010,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>1,010,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>1,010,949</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>U.S. Treasury Notes</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>4.75</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>5/15/14</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>710,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>710,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>750,825</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>U.S. Treasury Notes</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>2.625</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>11/16/04</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>933,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>933,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>933,877</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>General Electric Capital Corp.</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>3.45</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>7/16/07</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>2,000,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>2,000,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>2,013,680</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>HSBC Bank USA Global</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>3.875</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>9/15/09</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>800,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>800,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>803,208</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>Autonation, Inc.</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>9.00</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>8/1/08</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>1,000,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>1,000,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>1,152,500</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>BankOne Corp.</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>6.50</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>2/1/06</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>1,000,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>1,000,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>1,047,280</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>Citigroup, Inc.</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>5.75</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>5/10/06</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>3,000,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>3,000,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>3,133,920</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>Progress Energy, Inc.</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>6.75</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>3/1/06</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>400,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>400,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>419,628</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=center>
<FONT size=2>Autonation, Inc.</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=right>
<FONT size=2>9.00</FONT>
	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=center>
      <div align="right"><FONT size=2>8/1/08</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=center>
      <div align="right"><FONT size=2>1,000,000</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>1,000,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>1,152,500</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=left>

	</TD>
	<TD width=2% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=6% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=7% align=left>

	  <div align="right"></div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=7% align=right>
<FONT size=2>$13,886,197</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	  <div align="right"></div></TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=2>
	</TD>
</TR>
</TABLE>
<BR>
<P>
<FONT size=2>The average daily balance and weighted average interest rate of reverse repurchase agreements during the year ended October 31, 2004, were as follows:</FONT></P>
<TABLE border=0 cellspacing=0 cellpadding=0 width=50%>
<TR valign="bottom">
	<TD width=32% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=24% align=center>
<B><FONT size=2>Average Daily</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=27% align=center>
<B><FONT size=2>Weighted Average</FONT></B>
	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=32% align=left>
<B><FONT size=2>Trust</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=24% align=center>
<B><FONT size=2>Balance</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=27% align=center>
<B><FONT size=2>Interest Rate</FONT></B>
	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>&nbsp;
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=32% align=left>
<FONT size=2>Broad Investment Grade</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=4% align=right>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=24% align=center>
      <div align="right"><FONT size=2>$22,054,691</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=27% align=right>
<FONT size=2>1.20</FONT>
	</TD>
	<TD width=4% align=left>
<FONT size=2>%</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=32% align=left>
<FONT size=2>Core Bond</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=24% align=center>
      <div align="right"><FONT size=2>145,093,933</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=27% align=right>
<FONT size=2>1.11</FONT>
	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=32% align=left>
<FONT size=2>Income Opportunity</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=24% align=center>
      <div align="right"><FONT size=2>97,264,139</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=27% align=right>
<FONT size=2>1.14</FONT>
	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=32% align=left>
<FONT size=2>Income Trust</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=24% align=center>
      <div align="right"><FONT size=2>158,277,942</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=27% align=right>
<FONT size=2>1.12</FONT>
	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=32% align=left>
<FONT size=2>Limited Duration</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=24% align=center>
      <div align="right"><FONT size=2>195,844,775</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=27% align=right>
<FONT size=2>1.32</FONT>
	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=32% align=left>
<FONT size=2>Strategic Bond</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=4% align=left>

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=24% align=center>
      <div align="right"><FONT size=2>27,651,966</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=27% align=right>
<FONT size=2>1.33</FONT>
	</TD>
	<TD width=4% align=left>&nbsp;

	</TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2>75</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<A name="page_78"></A>

<P>
<B><FONT size=2>Dollar Rolls: </FONT></B><FONT size=2>The Trusts may enter into dollar rolls in which a Trust sells securities for delivery in the current month and simultaneously contracts to repurchase substantially similar (same type, coupon and
maturity) securities on a specified future date. During the roll period the Trusts forgo principal and interest paid on the securities. The Trusts will be compensated by the interest earned on the cash proceeds of the initial sale and/or by the
lower repurchase price at the future date.</FONT></P>
<P>
<B><FONT size=2>Loan Payable: </FONT></B><FONT size=2>High Yield has a $32 million committed credit facility (the &#147;facility&#148;). Under the terms of the facility, the Trust borrows at the London Interbank Offered Rate (&#147;LIBOR&#148;) plus
facility and administrative fees. In addition, the Trust pays a liquidity fee on the unused portion of the facility. The Trust may borrow up to 33</FONT><FONT size=1><SUP> 1 </SUP>/<SUB> 3 </SUB></FONT><FONT size=2>% of its total assets up to the
committed amount. In accordance with the terms of the facility, the Trust has pledged its portfolio assets as collateral for the borrowing.</FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>For the year ended October 31, 2004, High Yield borrowed a daily weighted average balance of $19,250,000 at a weighted average interest rate at 1.80% .</FONT></P>
<P>
<B>Note 5. Commitments</B></P>
<P>
<B><FONT size=2>Bridge Debt Commitments: </FONT></B><FONT size=2>At October 31, 2004, High Yield and Limited Duration had $2,003,993 and $17,813,268, respectively, in commitments outstanding to fund high yield bridge debt. The Trusts are entitled to
a fee upon the expiration of the commitment period, generally within six months of the initial commitment</FONT></P>
<P>
<FONT size=2>date. The bridge debt terms approximate market rates at the time the commitment is entered into.</FONT></P>
<P>
<B>Note 6. Distributions to Shareholders</B></P>
<P>
<FONT size=2>The tax character of distributions paid during the year ended October 31, 2004 and the period ended October 31, 2003 were as follows:</FONT></P>
<TABLE border=0 cellspacing=0 cellpadding=0 width=100%>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=14% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=28% colspan=3 align=center>
<B><FONT size=2>Period ended October 31, 2004</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=14% align=center>
<B><FONT size=2>Ordinary</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
      <center>
        <B><FONT size=2>Non-taxable</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=16% align=center>
      <center>
        <B><FONT size=2>Long-term</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=center>
<B><FONT size=2>Total</FONT></B>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>
<B><FONT size=2>Distributions Paid From:</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=14% align=center>
<B><FONT size=2>Income</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
      <center>
        <B><FONT size=2>Return of Capital</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=16% align=right>
      <center>
        <B><FONT size=2>Capital Gains</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=center>
<B><FONT size=2>Distributions</FONT></B>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>
<FONT size=2>Broad Investment Grade</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=14% align=center>
      <div align="right"><FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2,661,384</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#151;</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=9% align=right>
      <div align="right"><FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#151;</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2,661,384</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>
<FONT size=2>Core Bond</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=14% align=center>
      <div align="right"><FONT size=2>29,412,475</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>&#151;</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=9% align=right>
      <div align="right"><FONT size=2>556,750</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>29,969,225</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>
<FONT size=2>High Yield</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=14% align=center>
      <div align="right"><FONT size=2>5,864,606</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>187,188</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=9% align=right>
      <div align="right"><FONT size=2>&#151;</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>6,051,794</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>
<FONT size=2>Income Opportunity</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=14% align=center>
      <div align="right"><FONT size=2>28,937,742</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>&#151;</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=9% align=right>
      <div align="right"><FONT size=2>&#151;</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>28,937,742</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>
<FONT size=2>Income Trust</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=14% align=center>
      <div align="right"><FONT size=2>38,921,208</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>&#151;</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=9% align=right>
      <div align="right"><FONT size=2>&#151;</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>38,921,208</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>
<FONT size=2>Limited Duration</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=14% align=center>
      <div align="right"><FONT size=2>55,077,640</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>&#151;</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=9% align=right>
      <div align="right"><FONT size=2>&#151;</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>55,077,640</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>
<FONT size=2>Strategic Bond</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=14% align=center>
      <div align="right"><FONT size=2>11,337,469</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=10% align=right>
      <div align="right"><FONT size=2>&#151;</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=9% align=right>
      <div align="right"><FONT size=2>&#151;</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=2%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>11,337,469</FONT>&nbsp;
      </div></TD>
</TR>
</TABLE>
<BR>
<TABLE border=0 cellspacing=0 cellpadding=0 width=100%>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=14% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=28% colspan=3 align=center>
<B><FONT size=2>Period ended October 31, 2003</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=14% align=center>
<B><FONT size=2>Ordinary</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
      <center>
        <B><FONT size=2>Non-taxable</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=16% align=center>
      <center>
        <B><FONT size=2>Long-term</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=center>
<B><FONT size=2>Total</FONT></B>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>
<B><FONT size=2>Distributions Paid From:</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=14% align=center>
<B><FONT size=2>Income</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=center>
      <center>
        <B><FONT size=2>Return of Capital</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=16% align=right>
      <center>
        <B><FONT size=2>Capital Gains</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=center>
<B><FONT size=2>Distributions</FONT></B>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>
<FONT size=2>Broad Investment Grade</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=14% align=center>
      <div align="right"><FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3,504,653</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#151;</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#151;</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3,504,653</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>
<FONT size=2>Core Bond</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=14% align=center>
      <div align="right"><FONT size=2>30,289,664</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>1,795,095</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>32,084,759</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>
<FONT size=2>High Yield</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=14% align=center>
      <div align="right"><FONT size=2>6,783,092</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>333,356</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>7,116,448</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>
<FONT size=2>Income Opportunity</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=14% align=center>
      <div align="right"><FONT size=2>36,267,803</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>36,267,803</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>
<FONT size=2>Income Trust</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=14% align=center>
      <div align="right"><FONT size=2>63,862,381</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>63,862,381</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>
<FONT size=2>Limited Duration</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=14% align=center>
      <div align="right"><FONT size=2>9,176,505</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>9,176,505</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=20% align=left>
<FONT size=2>Strategic Bond</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=14% align=center>
      <div align="right"><FONT size=2>10,466,535</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=10% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>10,466,535</FONT>&nbsp;
      </div></TD>
</TR>
</TABLE>
<BR>
<P>
<FONT size=2>As of October 31, 2004, the components of distributable earnings on a tax basis were as follows:</FONT></P>
<TABLE border=0 cellspacing=0 cellpadding=0 width=75%>
<TR valign="bottom">
	<TD width=24% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=21% align=center>
<B><FONT size=2>Undistributed</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=13% align=center>
      <center>
        <B><FONT size=2>Undistributed</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=16% align=left>

	  <center>
    </center></TD>
</TR>
<TR valign="bottom">
	<TD width=24% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=21% align=center>
<B><FONT size=2>Ordinary</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=13% align=right>
      <center>
        <B><FONT size=2>Long-term</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=16% align=right>
      <center>
        <B><FONT size=2>Unrealized Net</FONT></B>&nbsp;
      </center></TD>
</TR>
<TR valign="bottom">
	<TD width=24% align=left>
<B><FONT size=2>Trust</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=21% align=center>
<B><FONT size=2>Income</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=13% align=center>
      <center>
        <B><FONT size=2>Gains</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=16% align=right>
      <center>
        <B><FONT size=2>Appreciation</FONT></B>&nbsp;
      </center></TD>
</TR>
<TR>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=24% align=left>
<FONT size=2>Broad Investment Grade</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=21% align=center>
      <div align="right"><FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7,959,288</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=13% align=right>
<FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#151;</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=16% align=right>
<FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2,431,031</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=24% align=left>
<FONT size=2>Core Bond</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=21% align=center>
      <div align="right"><FONT size=2>2,018,119</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=13% align=right>
<FONT size=2>5,953,869</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=16% align=right>
<FONT size=2>16,968,612</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=24% align=left>
<FONT size=2>High Yield</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=21% align=center>
      <div align="right"><FONT size=2>&#151;</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=13% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=16% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=24% align=left>
<FONT size=2>Income Opportunity</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=21% align=center>
      <div align="right"><FONT size=2>6,870,587</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=13% align=right>
<FONT size=2>8,926,885</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=16% align=right>
<FONT size=2>21,347,265</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=24% align=left>
<FONT size=2>Income Trust</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=21% align=center>
      <div align="right"><FONT size=2>3,627,727</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=13% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=16% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=24% align=left>
<FONT size=2>Limited Duration</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=21% align=center>
      <div align="right"><FONT size=2>5,674,866</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=13% align=right>
<FONT size=2>1,634,766</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=16% align=right>
<FONT size=2>31,869,396</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=24% align=left>
<FONT size=2>Strategic Bond</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=21% align=center>
      <div align="right"><FONT size=2>197,015</FONT>&nbsp;
      </div></TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=13% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=16% align=right>
<FONT size=2>6,213,545</FONT>&nbsp;
	</TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2>76</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<A name="page_79"></A>

<P>
<B>Note 7. Capital</B></P>
<P>
<FONT size=2>There are 200 million of $0.01 par value common shares authorized for each of the Broad Investment Grade, Income Opportunity and Income Trusts. There are an unlimited number of $0.001 par value common shares authorized for Core Bond,
High Yield, Limited Duration and Strategic Bond. At October 31, 2004, the common shares outstanding and the shares owned by affiliates of the Advisor of each Trust were:</FONT></P>
<TABLE border=0 cellspacing=0 cellpadding=0 width=50%>
<TR valign="bottom">
	<TD width=36% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=26% align=center>
      <center>
        <B><FONT size=2>Common Shares</FONT></B>&nbsp;
      </center></TD>
	<TD width=10%>
	  <center>
    </center></TD>
	<TD width=26% align=center>
      <center>
        <B><FONT size=2>Common Shares</FONT></B>&nbsp;
      </center></TD>
</TR>
<TR valign="bottom">
	<TD width=36% align=left>
<B><FONT size=2>Trust</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=26% align=center>
      <center>
        <B><FONT size=2>Outstanding</FONT></B>&nbsp;
      </center></TD>
	<TD width=10%>
	  <center>
    </center></TD>
	<TD width=26% align=right>
      <center>
        <B><FONT size=2>Owned</FONT></B>&nbsp;
      </center></TD>
</TR>
<TR>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=36% align=left>
<FONT size=2>Broad Investment Grade</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=26% align=center>
      <div align="right"><FONT size=2>2,957,093</FONT>&nbsp;
      </div></TD>
	<TD width=10%>&nbsp;
	</TD>
	<TD width=26% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=36% align=left>
<FONT size=2>Core Bond</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=26% align=center>
      <div align="right"><FONT size=2>27,018,774</FONT>&nbsp;
      </div></TD>
	<TD width=10%>&nbsp;
	</TD>
	<TD width=26% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=36% align=left>
<FONT size=2>High Yield</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=26% align=center>
      <div align="right"><FONT size=2>6,403,606</FONT>&nbsp;
      </div></TD>
	<TD width=10%>&nbsp;
	</TD>
	<TD width=26% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=36% align=left>
<FONT size=2>Income Opportunity</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=26% align=center>
      <div align="right"><FONT size=2>34,449,693</FONT>&nbsp;
      </div></TD>
	<TD width=10%>&nbsp;
	</TD>
	<TD width=26% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=36% align=left>
<FONT size=2>Income Trust</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=26% align=center>
      <div align="right"><FONT size=2>63,715,468</FONT>&nbsp;
      </div></TD>
	<TD width=10%>&nbsp;
	</TD>
	<TD width=26% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=36% align=left>
<FONT size=2>Limited Duration</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=26% align=center>
      <div align="right"><FONT size=2>36,727,287</FONT>&nbsp;
      </div></TD>
	<TD width=10%>&nbsp;
	</TD>
	<TD width=26% align=right>
<FONT size=2>6,021</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=36% align=left>
<FONT size=2>Strategic Bond</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=26% align=center>
      <div align="right"><FONT size=2>7,048,718</FONT>&nbsp;
      </div></TD>
	<TD width=10%>&nbsp;
	</TD>
	<TD width=26% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
</TR>
</TABLE>
<BR>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>During the year ended October 31, 2004, High Yield, Income Trust, Limited Duration and Strategic Bond issued additional shares under their dividend reinvestment plans of 21,958, 325,777, 21,266, and 13,097,
respectively. Transactions in common shares of beneficial interest for the year ended October 31, 2003, were as follows:</FONT></P>
<TABLE border=0 cellspacing=0 cellpadding=0 width=100%>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=17% align=left>

	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=25% align=center>
      <center>
        <B><FONT size=2>Shares from</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=14% align=left>

	  <center>
    </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=16% align=left>

	  <center>
    </center></TD>
</TR>
<TR>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR align="center" size=1 noshade>
	</TD>
	<TD>
	  <center>
	    <HR align="center" size=1 noshade>
      </center></TD>
	<TD>
<HR align="center" size=1 noshade>
	</TD>
	<TD>
	  <center>
	    <HR align="center" size=1 noshade>
      </center></TD>
	<TD>
<HR align="center" size=1 noshade>
	</TD>
	<TD>
	  <center>
    </center></TD>
	<TD>
	  <center>
    </center></TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=17% align=right>
      <center>
        <B><FONT size=2>Intial Public</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=25% align=center>
      <center>
        <B><FONT size=2>Underwriters&#146; Exercising the</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=14% align=center>
      <center>
        <B><FONT size=2>Reinvestment</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=16% align=center>
      <center>
        <B><FONT size=2>Net Increase in</FONT></B>&nbsp;
      </center></TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>
<B><FONT size=2>Trust</FONT></B>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=17% align=center>
      <center>
        <B><FONT size=2>Offering</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=25% align=center>
      <center>
        <B><FONT size=2>Over-allotment Option</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=14% align=center>
      <center>
        <B><FONT size=2>of Dividends</FONT></B>&nbsp;
      </center></TD>
	<TD width=2%>
	  <center>
    </center></TD>
	<TD width=16% align=center>
      <center>
        <B><FONT size=2>Shares Outstanding</FONT></B>&nbsp;
      </center></TD>
</TR>
<TR>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>
<FONT size=2>High Yield</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=17% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=25% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=14% align=right>
<FONT size=2>29,680</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=16% align=right>
<FONT size=2>29,680</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>
<FONT size=2>Income Trust</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=17% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=25% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=14% align=right>
<FONT size=2>514,874</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=16% align=right>
<FONT size=2>514,874</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>
<FONT size=2>Limited Duration</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=17% align=right>
<FONT size=2>34,306,021</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=25% align=right>
<FONT size=2>2,400,000</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=14% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=16% align=right>
<FONT size=2>36,706,021</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=18% align=left>
<FONT size=2>Strategic Bond</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=17% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=25% align=right>
<FONT size=2>&#151;</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=14% align=right>
<FONT size=2>19,467</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=16% align=right>
<FONT size=2>19,467</FONT>&nbsp;
	</TD>
</TR>
</TABLE>
<BR>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>Offering costs incurred in connection with the Limited Duration offering of common shares have been charged to paid-in capital in excess of par of the common shares in the amount of $1,222,110.</FONT></P>
<P>
<B>Note 8. Dividends</B></P>
<P>
<FONT size=2>Subsequent to October 31, 2004, the Board of each of the Trusts declared dividends per common share payable November 28, 2004, to shareholders of record on November 14, 2004. The per share common dividends declared were as
follows:</FONT></P>
<TABLE border=0 cellspacing=0 cellpadding=0 width=50%>
<TR valign="bottom">
	<TD width=50% align=left>&nbsp;

	</TD>
	<TD width=4%>&nbsp;
	</TD>
	<TD width=14%>&nbsp;
	</TD>
	<TD width=32% align=center>
<B><FONT size=2>Common Dividend</FONT></B>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=50% align=left>
<B><FONT size=2>Trust</FONT></B>&nbsp;
	</TD>
	<TD width=4%>&nbsp;
	</TD>
	<TD width=14%>&nbsp;
	</TD>
	<TD width=32% align=center>
<B><FONT size=2>Per Share</FONT></B>&nbsp;
	</TD>
</TR>
<TR>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=50% align=left>
<FONT size=2>Broad Investment Grade</FONT>&nbsp;
	</TD>
	<TD width=4%>&nbsp;
	</TD>
	<TD width=14%>&nbsp;
	</TD>
	<TD width=32% align=center>
      <div align="right"><FONT size=2>$0.075000</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=50% align=left>
<FONT size=2>Core Bond</FONT>&nbsp;
	</TD>
	<TD width=4%>&nbsp;
	</TD>
	<TD width=14%>&nbsp;
	</TD>
	<TD width=32% align=center>
      <div align="right"><FONT size=2>0.087500</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=50% align=left>
<FONT size=2>High Yield</FONT>&nbsp;
	</TD>
	<TD width=4%>&nbsp;
	</TD>
	<TD width=14%>&nbsp;
	</TD>
	<TD width=32% align=center>
      <div align="right"><FONT size=2>0.068333</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=50% align=left>
<FONT size=2>Income Opportunity</FONT>&nbsp;
	</TD>
	<TD width=4%>&nbsp;
	</TD>
	<TD width=14%>&nbsp;
	</TD>
	<TD width=32% align=center>
      <div align="right"><FONT size=2>0.070000</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=50% align=left>
<FONT size=2>Income Trust</FONT>&nbsp;
	</TD>
	<TD width=4%>&nbsp;
	</TD>
	<TD width=14%>&nbsp;
	</TD>
	<TD width=32% align=center>
      <div align="right"><FONT size=2>0.051042</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=50% align=left>
<FONT size=2>Limited Duration</FONT>&nbsp;
	</TD>
	<TD width=4%>&nbsp;
	</TD>
	<TD width=14%>&nbsp;
	</TD>
	<TD width=32% align=center>
      <div align="right"><FONT size=2>0.125000</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=50% align=left>
<FONT size=2>Strategic Bond</FONT>&nbsp;
	</TD>
	<TD width=4%>&nbsp;
	</TD>
	<TD width=14%>&nbsp;
	</TD>
	<TD width=32% align=center>
      <div align="right"><FONT size=2>0.130000</FONT>&nbsp;
      </div></TD>
</TR>
</TABLE>
<BR>
<P align="center">
<FONT size=2>77</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<A name="page_80"></A>

<P align="center">
<B>REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM</B></P>
<hr noshade>
<p><FONT size=2>To the Trustees and Shareholders of:</FONT><BR>
<FONT size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;BlackRock Broad Investment Grade 2009 Term Trust, Inc.</FONT><BR>
<FONT size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;BlackRock Core Bond Trust </FONT><BR>
<FONT size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;BlackRock High Yield Trust</FONT><BR>
<FONT size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;BlackRock Income Opportunity Trust</FONT><BR>
<FONT size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;BlackRock Income Trust, Inc.</FONT><BR>
<FONT size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;BlackRock Limited Duration Income Trust</FONT><BR>
<FONT size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;BlackRock Strategic Bond Trust</FONT><BR>
<FONT size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(collectively the &#147;Trusts&#148;)</FONT><BR>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>We have audited the accompanying statements of assets and liabilities of the Trusts, including the portfolios of investments, as of October 31, 2004, and the related statements of operations and cash flows
for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the periods presented. These financial statements and financial highlights are the
responsibility of the Trusts&#146; management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.</FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>We conducted our audits in accordance with standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures
included confirmation of securities owned as of October 31, 2004, by correspondence with the custodian and brokers; where replies were not received from brokers, we performed other auditing procedures. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. </FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of each of the Trusts as of October 31, 2004, the results
of their operations and cash flows for the year then ended, and the related statements of operations and cash flows for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, and the
financial highlights for each of the periods presented in conformity with accounting principles generally accepted in the United States of America.</FONT></P>
<IMG src="c34672_ncsrx80x1.jpg" border=0>
<BR>
<FONT size=2>Boston, Massachusetts</FONT><BR>
<FONT size=2>December 23, 2004</FONT><BR>
<P align="center">
<FONT size=2>78</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<A name="page_81"></A>

<P>
<B>DIRECTORS/TRUSTEES INFORMATION (Unaudited)</B></P>
<TABLE border=0 cellspacing=0 cellpadding=0 width=100%>
<TR valign="bottom">
	<TD align=center width=100% colspan=9>
<B><FONT size=1>Independent Trustees</FONT></B>
	</TD>
</TR>
<TR>
	<TD colspan=9 width=100%>
<HR noshade size=1>
	</TD>
</TR>
<TR>
	<TD colspan=9>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Name, address, age</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Andrew F. Brimmer</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Richard E. Cavanagh</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Kent Dixon</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Frank J. Fabozzi</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>P.O. Box 4546</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>P.O. Box 4546</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>P.O. Box 4546</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>P.O. Box 4546</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>New York, NY 10163-4546</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>New York, NY 10163-4546</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>New York, NY 10163-4546</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>New York, NY 10163-4546</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
 <div align="left"><FONT size=1>Age: 77</FONT>&nbsp;
    </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
 <div align="left"><FONT size=1>Age: 58</FONT>&nbsp;
    </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
 <div align="left"><FONT size=1>Age: 67</FONT>&nbsp;
    </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
 <div align="left"><FONT size=1>Age: 56</FONT>&nbsp;
    </div></TD>
</TR>
<TR>
	<TD width="15%">
<HR align="left" size=1 noshade>
	</TD>
	<TD>
	  <div align="left">
	    <HR align="left" size=1 noshade>
	  </div></TD>
	<TD><HR align="left" size=1 noshade>
	</TD>
	<TD>
	  <div align="left">
	    <HR align="left" size=1 noshade>
	  </div></TD>
	<TD width="15%"><HR align="left" size=1 noshade>
	</TD>
	<TD>
	  <div align="left">
	    <HR align="left" size=1 noshade>
	  </div></TD>
	<TD width="15%"><HR align="left" size=1 noshade>
	</TD>
	<TD>
	  <div align="left">
	    <HR align="left" size=1 noshade>
	  </div></TD>
	<TD width="15%"><HR align="left" size=1 noshade>
	</TD>
</TR>
<TR>
	<TD colspan=9>

	  <div align="left"></div></TD>
</TR>
<TR>
	<TD colspan=9>

	  <div align="left"></div></TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Current positions held with</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Lead Trustee</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Trustee</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Trustee</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Trustee</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>
      <div align="left"><FONT size=1>the Trusts</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Audit Committee Chairman</FONT><SUP><FONT size=1>2</FONT></SUP>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Audit Committee Member</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Audit Committee Member</FONT><SUP><FONT size=1>2</FONT></SUP>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
 <div align="left"><FONT size=1>Audit Committee Member</FONT><SUP><FONT size=1>3</FONT></SUP>&nbsp; </div></TD>
</TR>
<TR valign="bottom">
	<TD colspan="9" align=left>

	  <div align="left"></div>
	  <div align="left"></div>

	  <div align="left"></div>
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	  <div align="left"></div>
	  <div align="left"></div>
      <div align="left">
        <HR align="left" size=1 noshade>
      </div></TD>
  </TR>
<TR>
	<TD width="15%">&nbsp;
	</TD>
	<TD>
	  <div align="left"></div></TD>
	<TD>&nbsp;
	</TD>
	<TD>
	  <div align="left"></div></TD>
	<TD width="15%">&nbsp;
	</TD>
	<TD>
	  <div align="left"></div></TD>
	<TD width="15%">&nbsp;
	</TD>
	<TD>
	  <div align="left"></div></TD>
	<TD width="15%">&nbsp;
	</TD>
</TR>
<TR>
	<TD colspan=9>

	  <div align="left"></div></TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Term of office and length</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>3 years</FONT><SUP><FONT size=1>5 </FONT></SUP><FONT size=1>/ since inception</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>3 years</FONT><SUP><FONT size=1>5 </FONT></SUP><FONT size=1>/ since inception</FONT><SUP><FONT size=1>6</FONT></SUP>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>3 years</FONT><SUP><FONT size=1>5 </FONT></SUP><FONT size=1>/ since inception</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>3 years</FONT><SUP><FONT size=1>5 </FONT></SUP><FONT size=1>/ since inception</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>
      <div align="left"><FONT size=1>of time served</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
</TR>
<TR>
	<TD width="15%">
<HR align="left" size=1 noshade>
	</TD>
	<TD>
	  <div align="left">
	    <HR align="left" size=1 noshade>
	  </div></TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
	  <div align="left">
	    <HR align="left" size=1 noshade>
	  </div></TD>
	<TD width="15%">
<HR align="left" size=1 noshade>
	</TD>
	<TD>
	  <div align="left">
	    <HR align="left" size=1 noshade>
	  </div></TD>
	<TD width="15%">
<HR align="left" size=1 noshade>
	</TD>
	<TD>
	  <div align="left">
	    <HR align="left" size=1 noshade>
	  </div></TD>
	<TD width="15%">
<HR align="left" size=1 noshade>
	</TD>
</TR>
<TR>
	<TD colspan=9>

	  <div align="left"></div></TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Principal occupations</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>President of Brimmer &amp;</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>President and Chief Executive</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Consultant/Investor.</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Consultant. Editor of THE</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>
      <div align="left"><FONT size=1>during the past five years</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Company, Inc., a Washington,</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Officer of The Conference Board,</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Former President and Chief</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>JOURNAL OF PORTFOLIO</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>D.C.-based economic and</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Inc., a leading global business</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Executive Officer of</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>MANAGEMENT and</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>financial consulting firm, also</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>research organization, from 1995-</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Empire Federal Savings</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Frederick Frank Adjunct</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Wilmer D. Barrett Professor of</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>present. Former Executive Dean of</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Bank of America and Banc</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Professor of Finance at the</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Economics, University of</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>the John F. Kennedy School of</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>PLUS Savings Association,</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>School of Management at Yale</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Massachusetts &#150; Amherst.</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Government at Harvard University</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>former Chairman of the</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>University. Author and editor</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Formerly member of the Board</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>from 1988-1995. Acting Director,</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Board, President and Chief</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>of several books on fixed</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>of Governors of the Federal</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Harvard Center for Business and</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Executive Officer of</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>income portfolio management.</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Reserve System. Former</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Government (1991-1993). Formerly</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Northeast Savings.</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Visiting Professor of Finance</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Chairman, District of Columbia</FONT>&nbsp;
      </div></TD>
	<TD width=2%>

	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Partner (principal) of McKinsey &amp;</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>and Accounting at the Sloan</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Financial Control Board.</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Company, Inc. (1980- 1988).</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>School of Management,</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Former Executive Director of</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Massachusetts Institute of</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Federal Cash Management, White</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Technology from 1986 to</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=left><font size=1>House Office of Management and</font>&nbsp; </TD>
  <TD>&nbsp;</TD>
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=left><FONT size=1>August 1992.</FONT>&nbsp; </TD>
</TR>
<TR valign="bottom">
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=left><FONT size=1>Budget (1977-1979). Co-author,</FONT> </TD>
  <TD>&nbsp;</TD>
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=left>&nbsp;</TD>
</TR>
<TR valign="bottom">
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=left><FONT size=1>THE WINNING PERFORMANCE</FONT> </TD>
  <TD>&nbsp;</TD>
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=left>&nbsp;</TD>
</TR>
<TR valign="bottom">
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=left><FONT size=1>(best selling management book pub-</FONT> </TD>
  <TD>&nbsp;</TD>
  <TD align=left>&nbsp;</TD>
  <TD>&nbsp;</TD>
  <TD align=left>&nbsp;</TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>lished in 13 national editions).</FONT>&nbsp; </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"></div></TD>
</TR>
<TR valign="bottom">
	<TD align=center width=100% colspan=9>
      <div align="left"></div></TD>
</TR>
<TR valign="bottom">
	<TD align=center width=100% colspan=9>
      <div align="left">
        <HR align="left" size=1 noshade>
      </div></TD>
</TR>
<TR>
	<TD width="15%">&nbsp;
	</TD>
	<TD>
	  <div align="left"></div></TD>
	<TD>&nbsp;
	</TD>
	<TD>
	  <div align="left"></div></TD>
	<TD width="15%">&nbsp;
	</TD>
	<TD>
	  <div align="left"></div></TD>
	<TD width="15%">&nbsp;
	</TD>
	<TD>
	  <div align="left"></div></TD>
	<TD width="15%">&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Number of portfolios</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>52</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>52</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>52</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>52</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>
      <div align="left"><FONT size=1>overseen within the fund</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>
      <div align="left"><FONT size=1>complex</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

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<HR align="left" size=1 noshade>
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	<TD colspan=9>

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<TR valign="bottom">
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Other Directorships held</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Director of CarrAmerica Realty</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Trustee: Aircraft Finance Trust</FONT>&nbsp;
      </div></TD>
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	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Former Director of ISFA</FONT>&nbsp;
      </div></TD>
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	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Director, Guardian Mutual</FONT>&nbsp;
      </div></TD>
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<TR valign="bottom">
	<TD width=15% align=left>
      <div align="left"><FONT size=1>outside of the fund</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Corporation and Borg-Warner</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>(AFT) and Educational Testing</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>(the owner of INVEST, a</FONT>&nbsp;
      </div></TD>
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	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Funds Group (18 portfolios).</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>
      <div align="left"><FONT size=1>complex</FONT>&nbsp;
      </div></TD>
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	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Automotive. Formerly Director</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Service (ETS). Director, Arch</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>national securities broker-</FONT>&nbsp;
      </div></TD>
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	<TD width=15% align=left>

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	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>of Airborne Express,</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Chemicals, Fremont Group and The</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>age service designed for</FONT>&nbsp;
      </div></TD>
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	<TD width=15% align=left>

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<TR valign="bottom">
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	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>BankAmerica Corporation</FONT>&nbsp;
      </div></TD>
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	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Guardian Life Insurance Company</FONT>&nbsp;
      </div></TD>
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	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>banks and thrift</FONT>&nbsp;
      </div></TD>
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	  <div align="left"></div></TD>
	<TD width=15% align=left>

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	<TD width=15% align=left>
      <div align="left"><FONT size=1>(Bank of America), BellSouth</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>of America.</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>institutions).</FONT>&nbsp;
      </div></TD>
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	<TD width=15% align=left>

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<TR valign="bottom">
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	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Corporation, College</FONT>&nbsp;
      </div></TD>
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	  <div align="left"></div></TD>
	<TD width=15% align=left>

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	<TD width=2%>
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	<TD width=15% align=left>
      <div align="left"><FONT size=1>Retirement Equities Fund</FONT>&nbsp;
      </div></TD>
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	<TD width=15% align=left>

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      <div align="left"><FONT size=1>(Trustee), Commodity</FONT>&nbsp;
      </div></TD>
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	<TD width=2%>
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	<TD width=15% align=left>
      <div align="left"><FONT size=1>Exchange, Inc. (Public</FONT>&nbsp;
      </div></TD>
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	  <div align="left"></div></TD>
	<TD width=15% align=left>

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</TR>
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	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Governor), Connecticut Mutual</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

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</TR>
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	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Life Insurance Company, E.I.</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

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	<TD width=2%>
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</TR>
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	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>du Pont de Nemours &amp;</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

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	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>


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</TR>
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	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Company, Equitable Life</FONT>&nbsp;
      </div></TD>
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	  <div align="left"></div></TD>
	<TD width=15% align=left>

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	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Assurance Society of the</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

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	<TD width=2%>
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	<TD width=15% align=left>

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	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

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</TR>
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	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>United States, Gannett</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

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	<TD width=15% align=left>

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	<TD width=2%>
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	<TD width=15% align=left>

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</TR>
<TR valign="bottom">
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Company, Mercedes-Benz of</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
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	<TD width=15% align=left>

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	<TD width=2%>
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</TR>
<TR valign="bottom">
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	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>North America, MNC Financial</FONT>&nbsp;
      </div></TD>
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	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
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	<TD width=2%>
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</TR>
<TR valign="bottom">
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Corporation (American</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
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	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

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</TR>
<TR valign="bottom">
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Security Bank), NCM Capital</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
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	<TD width=15% align=left>

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	<TD width=2%>
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</TR>
<TR valign="bottom">
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Management, Navistar</FONT>&nbsp;
      </div></TD>
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	  <div align="left"></div></TD>
	<TD width=15% align=left>

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	<TD width=2%>
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</TR>
<TR valign="bottom">
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	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>International Corporation, PHH</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
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</TR>
<TR valign="bottom">
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	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Corp. and UAL Corporation</FONT>&nbsp;
      </div></TD>
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	  <div align="left"></div></TD>
	<TD width=15% align=left>

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</TR>
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	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>
      <div align="left"><FONT size=1>(United Airlines).</FONT>&nbsp;
      </div></TD>
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	  <div align="left"></div></TD>
	<TD width=15% align=left>

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</TR>
<TR>
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<HR align="left" size=1 noshade>
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	<TD>
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<HR align="left" size=1 noshade>
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	  </div></TD>
	<TD width="15%">
<HR align="left" size=1 noshade>
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	  </div></TD>
	<TD width="15%">
<HR align="left" size=1 noshade>
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	  </div></TD>
	<TD width="15%">
<HR align="left" size=1 noshade>
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</TR>
<TR>
	<TD colspan=9>

	  <div align="left"></div></TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>
      <div align="left"><FONT size=1>For &#147;Interested Director/</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
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	<TD width=15% align=left>

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</TR>
<TR valign="bottom">
	<TD width=15% align=left>
      <div align="left"><FONT size=1>Trustee&#148; relationships,</FONT>&nbsp;
      </div></TD>
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	  <div align="left"></div></TD>
	<TD width=15% align=left>

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<TR valign="bottom">
	<TD width=15% align=left>
      <div align="left"><FONT size=1>events or transactions by</FONT>&nbsp;
      </div></TD>
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	<TD width=15% align=left>

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	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>
      <div align="left"><FONT size=1>reason of which the Trustee</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>
      <div align="left"><FONT size=1>is an interested person as</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>
      <div align="left"><FONT size=1>defined in Section 2(a)(19)</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
</TR>
<TR valign="bottom">
	<TD width=15% align=left>
      <div align="left"><FONT size=1>of the 1940 Act</FONT>&nbsp;
      </div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
	<TD width=2%>
	  <div align="left"></div></TD>
	<TD width=15% align=left>

	  <div align="left"></div></TD>
</TR>
<TR>
	<TD width="15%">
<HR align="left" size=1 noshade>
	</TD>
	<TD>
	  <div align="left">
	    <HR align="left" size=1 noshade>
	  </div></TD>
	<TD>
<HR align="left" size=1 noshade>
	</TD>
	<TD>
	  <div align="left">
	    <HR align="left" size=1 noshade>
	  </div></TD>
	<TD width="15%">
<HR align="left" size=1 noshade>
	</TD>
	<TD>
	  <div align="left">
	    <HR align="left" size=1 noshade>
	  </div></TD>
	<TD width="15%">
<HR align="left" size=1 noshade>
	</TD>
	<TD>
	  <div align="left">
	    <HR align="left" size=1 noshade>
	  </div></TD>
	<TD width="15%">
<HR align="left" size=1 noshade>
	</TD>
</TR>
</TABLE>
<BR>
<TABLE border=0 cellspacing=0 cellpadding=0>
<TR>
	<TD nowrap valign=top>
<SUP><FONT size=2>1</FONT></SUP>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD>
<FONT size=2>Interested Trustee as defined by Section 2(a)(19) of the Investment Company Act of 1940.</FONT>	</TD>
</TR>
<TR>
	<TD nowrap valign=top>
<SUP><FONT size=2>2</FONT></SUP>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD>
<FONT size=2>The Board of each Trust has determined that each Trust has two Audit Committee financial experts serving on its Audit Committee, Dr. Brimmer and Mr. Dixon, both of whom are independent for the purpose of the definition of Audit
Committee financial expert as applicable to the Trusts.</FONT>	</TD>
</TR>
<TR>
	<TD nowrap valign=top>
<SUP><FONT size=2>3</FONT></SUP>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD>
<FONT size=2>Appointed Audit Committee Member on May 25, 2004.</FONT>	</TD>
</TR>
<TR>
	<TD nowrap valign=top>
<SUP><FONT size=2>4</FONT></SUP>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD>
<FONT size=2>Trustee since inception; appointed Chairman of the Board on August 22, 2002.</FONT>	</TD>
</TR>
<TR><TD colspan=2>&nbsp;</TD></TR></TABLE>
<P align="center">&nbsp;</P>


<P align="center"><FONT size=2>79</FONT></P>
<hr noshade align="center" width="100%" size=4>

<PAGE>
<A name="page_82"></A>

<TABLE border=0 cellspacing=0 cellpadding=0 width=100%>
<TR valign="bottom">
	<TD colspan="5" align=left>
      <center>
        <B><FONT size=1>Independent Trustees (continued)</FONT></B>&nbsp;
      </center></TD>
	<TD width=1%>
	  <center>
    </center></TD>
	<TD colspan=3 align=center>
      <center>
        <B><FONT size=1>Interested Trustees</FONT></B><B><SUP><FONT size=1>1</FONT></SUP></B>&nbsp;
      </center></TD>
</TR>
<TR>
	<TD width="22%">
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD colspan=3>
<HR noshade size=1>
	</TD>
</TR>
<TR>
	<TD colspan=9>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>R. Glenn Hubbard</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>
 &nbsp;<FONT size=1>James Clayburn La Force, Jr.</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>Walter F. Mondale</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>Ralph L. Schlosstein</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>Robert S. Kapito</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>P.O. Box 4546</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>
 &nbsp;<FONT size=1>P.O. Box 4546</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>P.O. Box 4546</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>BlackRock, Inc.</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>BlackRock, Inc.</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>New York, NY 10163-4546</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>
 &nbsp;<FONT size=1>New York, NY 10163-4546</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>New York, NY 10163-4546</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>40 East 52nd Street</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>40 East 52nd Street</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>Age: 46</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>
<FONT size=1>Age: 75</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>Age: 76</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>New York, NY 10022</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>New York, NY 10022</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>Age: 53</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>Age: 47</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD width="22%">
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1></TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR>
	<TD colspan=9>&nbsp;

	</TD>
</TR>

<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>Trustee</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>
 &nbsp;<FONT size=1>Trustee</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>Trustee</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>Chairman of the Board</FONT><SUP><FONT size=1>4</FONT></SUP>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>President and Trustee</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD width="22%">
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR>
	<TD colspan=9>&nbsp;

	</TD>
</TR>
<TR>
	<TD colspan=9>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>3 years</FONT><SUP><FONT size=1>5 </FONT></SUP><FONT size=1>/ since November 16,</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>
 &nbsp;<FONT size=1>3 years</FONT><SUP><FONT size=1>5 </FONT></SUP><FONT size=1>/ since inception</FONT><SUP><FONT size=1>7</FONT></SUP>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>3 years</FONT><SUP><FONT size=1>5 </FONT></SUP><FONT size=1>/ since inception</FONT><SUP><FONT size=1>8</FONT></SUP>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>3 years</FONT><SUP><FONT size=1>5 </FONT></SUP><FONT size=1>/ since inception</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>3 years</FONT><SUP><FONT size=1>5 </FONT></SUP><FONT size=1>/ since August 22,</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>2004</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>2002</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD width="22%">
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR>
	<TD colspan=9>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>Dean of Columbia Business</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>
 &nbsp;<FONT size=1>Dean Emeritus of the John E.</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>Senior Counsel, Dorsey &amp;</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>Director since 1999 and</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>Vice Chairman of BlackRock,</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>School since July 1, 2004.</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>
 &nbsp;<FONT size=1>Anderson Graduate School of</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>Whitney, LLP, a law firm</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>President of BlackRock, Inc.</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>Inc. Head of the Portfolio</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>Columbia faculty member since</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>
 &nbsp;<FONT size=1>Management, University of</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>(January 2004-present);</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>since its formation in 1998 and</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>Management Group. Also a</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>1988. Co-director of Columbia</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>
 &nbsp;<FONT size=1>California since July 1, 1993.</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>Partner, Dorsey &amp; Whitney,</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>of BlackRock, Inc.&#146;s predeces-</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>member of the Management</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>Business School&#146;s Entrepreneur-</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>
 &nbsp;<FONT size=1>Acting Dean of the School of</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>LLP, (December 1996-</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>sor entities since 1988. Member</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>Committee, the Investment</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>ship Program 1994-1997.</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>
 &nbsp;<FONT size=1>Business, Hong Kong</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>December 2003, September</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>of the Management Committee</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>Strategy Group, the Fixed</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>Visiting professor at Harvard&#146;s</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>
 &nbsp;<FONT size=1>University of Science and</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>1987-August 1993). Formerly</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>and Investment Strategy Group</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>Income and Global Operating</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>Kennedy School of Government</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>
 &nbsp;<FONT size=1>Technology 1990-1993. From</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>U.S. Ambassador to Japan</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>of BlackRock, Inc. Formerly,</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>Committees and the Equity</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>and Harvard Business School,</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>
 &nbsp;<FONT size=1>1978 to September 1993, Dean</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>(1993-1996). Formerly Vice</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>Managing Director of Lehman</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>Investment Strategy Group.</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>as well as the University of</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>
 &nbsp;<FONT size=1>of the John E. Anderson</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>President of the United States,</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>Brothers, Inc. and Co-head of</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>Responsible for the portfolio</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>Chicago. Visiting scholar at the</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>
 &nbsp;<FONT size=1>Graduate School of</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>U.S. Senator and Attorney</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>its Mortgage and Savings</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>management of the Fixed</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>American Enterprise Institute in</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>
 &nbsp;<FONT size=1>Management, University of</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>General of the State of</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>Institutions Group. Chairman</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>Income, Domestic Equity and</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>Washington and member of</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>
 &nbsp;<FONT size=1>California.</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>Minnesota. 1984 Democratic</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>and President of the BlackRock</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>International Equity, Liquidity,</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>International Advisory Board of</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>Nominee for President of the</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>Liquidity Funds and Director of</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>and Alternative Investment</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>the MBA Program of Ben-</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>United States.</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>several of BlackRock&#146;s alternative</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>Groups of BlackRock.</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>Gurion University. Deputy assis-</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>investment vehicles.</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>tant secretary of the U.S.</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>Treasury Department for Tax</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>Policy 1991&#150;1993. Chairman of</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>the U.S. Council of Economic</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>Advisers under the President of</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>the United States 2001&#150;2003.</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD width="22%">
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR>
	<TD colspan=9>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>52</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>
 &nbsp;<FONT size=1>52</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>52</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>62</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>52</FONT>&nbsp;
	</TD>
</TR>
<TR>
	<TD width="22%">
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR>
	<TD colspan=9>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>Director of ADP, Dex Media,</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>
 &nbsp;<FONT size=1>Payden &amp; Rygel Investment</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>Director of United Health</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>Member of the Visiting Board</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>Chairman of the Hope and</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>KKR Financial Corporation,</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>
 &nbsp;<FONT size=1>Trust, Metzler-Payden</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>Foundation and the Japan</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>of Overseers of the John F.</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>Heroes Children&#146;s Cancer</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>and Ripplewood Holdings.</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>
 &nbsp;<FONT size=1>Investment Trust, Advisors</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>Society. Member of the Hubert</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>Kennedy School of Government</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>Fund. President of the Board</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>Formerly on the advisory</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>
 &nbsp;<FONT size=1>Series Trust, Arena</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>H. Humphrey Institute of</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>at Harvard University, a member</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>of Directors of the Periwinkle</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>boards of the Congressional</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>
 &nbsp;<FONT size=1>Pharmaceuticals, Inc. and</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>Public Affairs Advisory Board,</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>of the board of the Financial</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>National Theatre for Young</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>Budget Office, the Council on</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>
 &nbsp;<FONT size=1>CancerVax Corporation.</FONT>&nbsp;
	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>The Mike and Maureen</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>Institutions Center of The</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;

	</TD>
	<TD width=23% align=left>
<FONT size=1>Audiences. Director of</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>Competitiveness, the American</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>Mansfield Foundation, Dean&#146;s</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>Wharton School of the</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>icruise.com, Corp.</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>Council on Capital Formation,</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>Board of Visitors of the</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>University of Pennsylvania, a</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>the Tax Foundation and the</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>Medical School at the</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>trustee of the American</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>Center for Addiction and</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>University of Minnesota, and</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>Museum of Natural History, a</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>Substance Abuse. Trustee of</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>the Mayo Foundation Advisory</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>trustee of Trinity School in New</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>Fifth Avenue Presbyterian</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>
<FONT size=1>Council to the President.</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>York City, a member of the</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>
<FONT size=1>Church of New York.</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>Board of Advisors of Marujupu</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>LLC, and a trustee of New</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>Visions for Public Education</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>and of The Public Theater in</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>New York City. Formerly, a</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>director of Pulte Corporation,</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>the nation&#146;s largest homebuilder,</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>a Trustee of Denison University</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>and a member of Fannie Mae&#146;s</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>Advisory Council.</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>&nbsp;

	</TD>
</TR>
<TR>
	<TD width="22%">
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD><HR noshade size=1>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR>
	<TD colspan=9>&nbsp;

	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>Director and President of the</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>Director and Vice Chairman of</FONT>&nbsp;
	</TD>
</TR>
<TR valign="bottom">
	<TD width=22% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=16% align=left>&nbsp;

	</TD>
	<TD width=2%>&nbsp;
	</TD>
	<TD width=19% align=left>&nbsp;

	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=21% align=left>
<FONT size=1>Advisor</FONT>&nbsp;
	</TD>
	<TD width=1%>&nbsp;
	</TD>
	<TD width=23% align=left>
<FONT size=1>the Advisor.</FONT>&nbsp;
	</TD>
</TR>
</TABLE>
<BR>
<TABLE border=0 cellspacing=0 cellpadding=0>
<TR>
	<TD nowrap valign=top>
<SUP><FONT size=2>5</FONT></SUP>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD>
<FONT size=2>The Board is classified into three classes of which one class is elected annually. Each Trustee serves a three-year term concurrent with the class from which he is elected.</FONT>	</TD>
</TR>
<TR>
	<TD nowrap valign=top>
<SUP><FONT size=2>6</FONT></SUP>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD>
<FONT size=2>For Broad Investment Grade, Income Opportunity and Income Trust appointed Director on 08/11/94.</FONT>	</TD>
</TR>
<TR>
	<TD nowrap valign=top>
<SUP><FONT size=2>7</FONT></SUP>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD>
<FONT size=2>For Income Opportunity and Income Trust appointed Director on 06/19/92.</FONT>	</TD>
</TR>
<TR>
	<TD nowrap valign=top>
<SUP><FONT size=2>8</FONT></SUP>&nbsp; &nbsp; &nbsp; 	</TD>
	<TD>
<FONT size=2>Except during the periods 08/12/93 through 04/15/97 and 10/31/02 through 11/11/02.</FONT>	</TD>
</TR>
<TR><TD colspan=2>&nbsp;</TD></TR></TABLE>
<P align="center">
<FONT size=2>80</FONT></P>
<hr noshade align="center" width="100%" size=4>
<PAGE>
<center>
  <A name="page_83"></A>

<p></p><B>DIVIDEND REINVESTMENT PLANS</B><BR>
</center>
<hr noshade align="center" width="100%" size=2><P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>Pursuant to each Trust&#146;s respective Dividend Reinvestment Plan (the &#147;Plan&#148;), shareholders of Broad Investment Grade, Income Opportunity and Income Trust may elect, while shareholders of Core
Bond, High Yield, Limited Duration and Strategic Bond are automatically enrolled, to have all distributions of dividends and capital gains reinvested by EquiServe Trust Company, N.A. (the &#147;Plan Agent&#148;) in the respective Trust&#146;s shares
pursuant to the Plan. Shareholders who do not participate in the Plan will receive all distributions in cash paid by check and mailed directly to the shareholders of record (or if the shares are held in street or other nominee name, then to the
nominee) by the Plan Agent, which serves as agent for the shareholders in administering the Plan.</FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>After Broad Investment Grade and/or Income Opportunity Trust declares a dividend or determines to make a capital gain distribution, the Plan Agent will acquire shares for the participants&#146; account, by
the purchase of outstanding shares on the open market, on the Trust&#146;s primary exchange or elsewhere (&#147;open market purchases&#148;). The Trust will not issue any new shares under the Plan.</FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>After Core Bond, High Yield, Income Trust, Limited Duration and/or Strategic Bond declares a dividend or determines to make a capital gain distribution, the Plan Agent will acquire shares for the
participants&#146; account, depending upon the circumstances described below, either (i) through receipt of unissued but authorized shares from the Trust (&#147;newly issued shares&#148;) or (ii) by open market purchases. If, on the dividend payment
date, the NAV is equal to or less than the market price per share plus estimated brokerage commissions (such condition being referred to herein as &#147;market premium&#148;), the Plan Agent will invest the dividend amount in newly issued shares on
behalf of the participants. The number of newly issued shares to be credited to each participant&#146;s account will be determined by dividing the dollar amount of the dividend by the NAV on the date the shares are issued. However, if the NAV is
less than 95% of the market price on the payment date, the dollar amount of the dividend will be divided by 95% of the market price on the payment date. If, on the dividend payment date, the NAV is greater than the market value per share plus
estimated brokerage commissions (such condition being referred to herein as &#147;market discount&#148;), the Plan Agent will invest the dividend amount in shares acquired on behalf of the participants in open-market purchases.</FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>The Plan Agent&#146;s fees for the handling of the reinvestment of dividends and distributions will be paid by each Trust. However, each participant will pay a pro rata share of brokerage commissions
incurred with respect to the Plan Agent&#146;s open market purchases in connection with the reinvestment of dividends and distributions. The automatic reinvestment of dividends and distributions will not relieve participants of any Federal income
tax that may be payable on such dividends or distributions.</FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>Each Trust reserves the right to amend or terminate the Plan. There is no direct service charge to participants in the Plan; however, each Trust reserves the right to amend the Plan to include a service
charge payable by the participants. Participants who request a sale of shares through the Plan Agent are subject to a $2.50 sales fee and a $0.15 per share sold brokerage commisson. All correspondence concerning the Plan should be directed to the
Plan Agent at 250 Royall Street, Canton, MA 02021 or (800) 699-1BFM.</FONT></P>
<P>
<FONT size=2>81</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<A name="page_84"></A>

<p></p>
<center>
  <B>ADDITIONAL INFORMATION</B><BR>
</center>
<HR noshade align="center" width="100%" size=2><P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>On August 25, 2004, BlackRock, Inc., the parent of BlackRock Advisors, Inc., the Trusts&#146; investment advisor, entered into an agreement with MetLife, Inc.</FONT><SUP><FONT size=2>&reg;
</FONT></SUP><FONT size=2>to acquire SSRM Holdings, Inc., the parent of State Street Research &amp; Management Company, the investment advisor to the State Street Research mutual funds. Management believes there will be no impact to the Trusts as a
result of this transaction.</FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>Quarterly performance and other information regarding the Trusts may be found on BlackRock&#146;s website, which can be accessed at http://www.blackrock.com/funds/cefunds/index.html. This reference to
BlackRock&#146;s website is intended to allow investors public access to information regarding the Trusts and does not, and is not intended, to incorporate BlackRock&#146;s website into this report.</FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>Certain of the officers of the Trusts listed on the inside back cover of this Report to Shareholders are also officers of the Advisor or Sub-Advisor. They serve in the following capacities for the Advisor
or Sub-Advisor; Robert S. Kapito&#151;Director and Vice Chairman of the Advisor and the Sub-Advisor, Henry Gabbay and Anne Ackerley&#151;Managing Directors of the Advisor and the Sub-Advisor, Richard M. Shea and James Kong&#151;Managing Directors of
the Sub-Advisor, Vincent B. Tritto&#151;Director of the Sub-Advisor, and Brian P. Kindelan&#151;Director of the Advisor</FONT></P>
<p></p><center>
<B>TAX INFORMATION</B><BR>
</center>
<HR noshade align="center" width="100%" size=2><P>
<FONT size=2>We wish to advise you as to the federal tax status of dividends paid by the Trusts during the fiscal year ended October 31, 2004.</FONT></P>
<P>
<FONT size=2>During the fiscal year ended October 31, 2004, the Trusts paid dividends and distributions as follows:</FONT></P>
<TABLE border=0 cellspacing=0 cellpadding=0 width=100%>
<TR valign="bottom">
	<TD width=26% align=left>&nbsp;

	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=17% align=left>

	  <center>
    </center></TD>
	<TD width=5%>
	  <center>
    </center></TD>
	<TD width=14% align=right>
      <center>
        <B><FONT size=2>Non-taxable</FONT></B>&nbsp;
      </center></TD>
	<TD width=5%>
	  <center>
    </center></TD>
	<TD width=12% align=right>
      <center>
        <B><FONT size=2>Long-term</FONT></B>&nbsp;
      </center></TD>
	<TD width=5%>
	  <center>
    </center></TD>
	<TD width=11% align=left>

	  <center>
    </center></TD>
</TR>
<TR valign="bottom">
	<TD width=26% align=left>&nbsp;

	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=17% align=center>
      <center>
        <B><FONT size=2>Ordinary Income</FONT></B>&nbsp;
      </center></TD>
	<TD width=5%>
	  <center>
    </center></TD>
	<TD width=14% align=center>
      <center>
        <B><FONT size=2>Return of Capital</FONT></B>&nbsp;
      </center></TD>
	<TD width=5%>
	  <center>
    </center></TD>
	<TD width=12% align=center>
      <center>
        <B><FONT size=2>Capital Gains</FONT></B>&nbsp;
      </center></TD>
	<TD width=5%>
	  <center>
    </center></TD>
	<TD width=11% align=left>

	  <center>
    </center></TD>
</TR>
<TR valign="bottom">
	<TD width=26% align=left>
<B><FONT size=2>Trust</FONT></B>&nbsp;
	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=17% align=center>
      <center>
        <B><FONT size=2>Per Share</FONT></B>&nbsp;
      </center></TD>
	<TD width=5%>
	  <center>
    </center></TD>
	<TD width=14% align=right>
      <center>
        <B><FONT size=2>per share</FONT></B>&nbsp;
      </center></TD>
	<TD width=5%>
	  <center>
    </center></TD>
	<TD width=12% align=right>
      <center>
        <B><FONT size=2>per share</FONT></B>&nbsp;
      </center></TD>
	<TD width=5%>
	  <center>
    </center></TD>
	<TD width=11% align=center>
      <center>
        <B><FONT size=2>Total</FONT></B>&nbsp;
      </center></TD>
</TR>
<TR>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
	<TD>
	</TD>
	<TD>
<HR noshade size=1>
	</TD>
</TR>
<TR valign="bottom">
	<TD width=26% align=left>
<FONT size=2>Broad Investment Grade (BCT)</FONT>&nbsp;
	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=17% align=center>
      <div align="right"><FONT size=2>$0.9000</FONT>&nbsp;
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#151;</FONT>&nbsp;
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD width=12% align=right>
      <div align="right"><FONT size=2>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#151;</FONT>&nbsp;
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>$0.9000</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=26% align=left>
<FONT size=2>Core Bond (BHK)</FONT>&nbsp;
	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=17% align=center>
      <div align="right"><FONT size=2>1.0886</FONT>&nbsp;
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>&#151;</FONT>&nbsp;
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD width=12% align=right>
      <div align="right"><FONT size=2>0.0206</FONT>&nbsp;
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>1.1092</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=26% align=left>
<FONT size=2>High Yield (BHY)</FONT>&nbsp;
	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=17% align=center>
      <div align="right"><FONT size=2>0.9158</FONT>&nbsp;
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>0.0292</FONT>&nbsp;
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD width=12% align=right>
      <div align="right"><FONT size=2>&#151;</FONT>&nbsp;
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>0.9451</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=26% align=left>
<FONT size=2>Income Opportunity (BNA)</FONT>&nbsp;
	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=17% align=center>
      <div align="right"><FONT size=2>0.8400</FONT>&nbsp;
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>&#151;</FONT>&nbsp;
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD width=12% align=right>
      <div align="right"><FONT size=2>&#151;</FONT>&nbsp;
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>0.8400</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=26% align=left>
<FONT size=2>Income Trust (BKT)</FONT>&nbsp;
	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=17% align=center>
      <div align="right"><FONT size=2>0.6109</FONT>&nbsp;
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>&#151;</FONT>&nbsp;
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD width=12% align=right>
      <div align="right"><FONT size=2>&#151;</FONT>&nbsp;
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>0.6109</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=26% align=left>
<FONT size=2>Limited Duration (BLW)</FONT>&nbsp;
	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=17% align=center>
      <div align="right"><FONT size=2>1.4996</FONT>&nbsp;
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>&#151;</FONT>&nbsp;
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD width=12% align=right>
      <div align="right"><FONT size=2>&#151;</FONT>&nbsp;
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>1.4996</FONT>&nbsp;
      </div></TD>
</TR>
<TR valign="bottom">
	<TD width=26% align=left>
<FONT size=2>Strategic Bond (BHD)</FONT>&nbsp;
	</TD>
	<TD width=5%>&nbsp;
	</TD>
	<TD width=17% align=center>
      <div align="right"><FONT size=2>1.6084</FONT>&nbsp;
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD width=14% align=right>
      <div align="right"><FONT size=2>&#151;</FONT>&nbsp;
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD width=12% align=right>
      <div align="right"><FONT size=2>&#151;</FONT>&nbsp;
      </div></TD>
	<TD width=5%>
	  <div align="right"></div></TD>
	<TD width=11% align=center>
      <div align="right"><FONT size=2>1.6084</FONT>&nbsp;
      </div></TD>
</TR>
</TABLE>
<BR>
<P>
<FONT size=2>Further, we wish to advise you that your income dividends do not qualify for the dividends received deduction.</FONT></P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2>For the purpose of preparing your 2004 annual federal income tax return, you should report the amounts as reflected on the appropriate Form 1099 DIV which will be mailed to you in January 2005.</FONT></P>
<P align="center">
<FONT size=2>82</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<A name="page_85"></A>

<P align="center">
<FONT size=2>(This page intentionally left blank)</FONT></P>

<HR noshade align="center" width="100%" size=4>

<PAGE>
<A name="page_86"></A>

<P align="center">
<FONT size=6 face="serif">BlackRock Closed-End Funds</FONT>
</P>
<TABLE width="100%" border=0 cellspacing=0 cellpadding=0>
<TR>
   <TD><FONT face="serif">Directors/Trustees</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">Ralph L. Schlosstein, Chairman</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">Andrew F. Brimmer</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">Richard E. Cavanagh</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">Kent Dixon</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">Frank J. Fabozzi</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">R. Glenn Hubbard</FONT><SUP><FONT size=2 face="serif">1</FONT></SUP></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">Robert S. Kapito</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">James Clayburn La Force, Jr.</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">Walter F. Mondale</FONT></TD>
</TR>
<TR>
  <TD>&nbsp;</TD>
</TR>
<TR>
   <TD><FONT face="serif">Officers</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">Robert S. Kapito, President</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">Henry Gabbay, Treasurer</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">Bartholomew Battista, Chief Compliance Officer</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">Anne Ackerley, Vice President</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">Richard M. Shea, Vice President/Tax</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">James Kong, Assistant Treasurer</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">Vincent B. Tritto, Secretary</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">Brian P. Kindelan, Assistant Secretary</FONT></TD>
</TR>
<TR>
  <TD>&nbsp;</TD>
</TR>
<TR>
   <TD><FONT face="serif">Investment Advisor</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">BlackRock Advisors, Inc.</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">100 Bellevue Parkway</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">Wilmington, DE 19809</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">(800) 227-7BFM</FONT></TD>
</TR>
<TR>
  <TD>&nbsp;</TD>
</TR>
<TR>
   <TD><FONT face="serif">Sub-Advisor</FONT><SUP><FONT face="serif">2</FONT></SUP></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">BlackRock Financial Management, Inc.</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">40 East 52nd Street</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">New York, NY 10022</FONT></TD>
</TR>
<TR>
  <TD>&nbsp;</TD>
</TR>
<TR>
   <TD><FONT face="serif">Accounting Agent and Custodian</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">State Street Bank and Trust Company</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">225 Franklin Street</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">Boston, MA 02110</FONT></TD>
</TR>
<TR>
  <TD colspan=1>&nbsp;</TD>
</TR>
<TR>
   <TD colspan=1>&nbsp;</TD>
</TR>
</TABLE>
<TABLE width="100%" border=0 cellspacing=0 cellpadding=0>
<TR>
   <TD><FONT face="serif">Transfer Agent</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">EquiServe Trust Company, N.A.</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">250 Royall Street</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">Canton, MA 02021</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">(800) 699-1BFM</FONT></TD>
</TR>
<TR>
  <TD>&nbsp;</TD>
</TR>
<TR>
   <TD><FONT face="serif">Independent Registered Public Accounting Firm</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">Deloitte &amp; Touche LLP</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">200 Berkeley Street</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">Boston, MA 02116</FONT></TD>
</TR>
<TR>
  <TD>&nbsp;</TD>
</TR>
<TR>
   <TD><FONT face="serif">Legal Counsel</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">Skadden, Arps, Slate, Meagher &amp; Flom LLP</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">Four Times Square</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">New York, NY 10036</FONT></TD>
</TR>
<TR>
  <TD>&nbsp;</TD>
</TR>
<TR>
   <TD><FONT face="serif">Legal Counsel &#150; Independent Trustees</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">Debevoise &amp; Plimpton LLP</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">919 Third Avenue</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">New York, NY 10022</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;</TD>
</TR>
<TR>
   <TD>&nbsp;&nbsp;&nbsp;<FONT size=2 face="serif">This report is for shareholder information. This is not a prospec-</FONT></TD>
</TR>
<TR>
   <TD><FONT size=2 face="serif">tus intended for use in the purchase or sale of Trust shares.</FONT></TD>
</TR>
<TR>
   <TD><FONT size=2 face="serif">Statements and other information contained in this report are as</FONT></TD>
</TR>
<TR>
   <TD><FONT size=2 face="serif">dated and are subject to change.</FONT></TD>
</TR>
<TR>
   <TD>&nbsp;</TD>
</TR>
<TR>
   <TD><FONT size=2 face="serif">BlackRock Closed-End Funds</FONT></TD>
</TR>
<TR>
   <TD><FONT size=2 face="serif">c/o BlackRock Advisors, Inc.</FONT></TD>
</TR>
<TR>
   <TD><FONT size=2 face="serif">100 Bellevue Parkway</FONT></TD>
</TR>
<TR>
   <TD><FONT size=2 face="serif">Wilmington, DE 19809</FONT></TD>
</TR>
<TR>
   <TD><FONT size=2 face="serif">(800) 227-7BFM</FONT></TD>
</TR>
</TABLE>
<p></p><TABLE width="100%" border=0 cellspacing=0 cellpadding=0>
<TR>
  <TD width="2%"><hr noshade size=1></TD>
  <TD width="4%"><hr noshade size=1> </TD>
  <TD width="94%">&nbsp;</TD>
</TR>
<TR>
   <TD><sup><font size=1 face="serif">1 </font></sup></TD>
   <TD colspan="2"><font size=1 face="serif">Appointed November 16, 2004.</font></TD>
</TR>
<TR>
   <TD><sup><font size=1 face="serif">2 </font></sup></TD>
   <TD colspan="2"><font size=1 face="serif">For Core Bond, Limited Duration and Strategic Bond.</font></TD>
</TR>
</TABLE>
<P>
<FONT size=2 face="serif">The Trusts will mail only one copy of shareholder documents, including annual and semi-annual reports and proxy statements, to shareholders with multiple accounts at the same address. This practice is commonly called
&#147;householding&#148; and is intended to reduce expenses and eliminate duplicate mailings of shareholder documents. Mailings of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the
mailing of these documents to be combined with those for other members of your household, please contact the Trusts at (800)699-1BFM.</FONT>
</P>
<P>
<FONT size=2 face="serif">The Trusts have delegated to the Advisor the voting of proxies relating to their voting securities pursuant to the Advisor&#146;s proxy voting policies and procedures. You may obtain a copy of these proxy voting policies
and procedures, without charge, by calling (800) 699-1BFM. These policies and procedures are also available on the website of the Securities and Exchange Commission (the &#147;Commission&#148;) at http://www.sec.gov.</FONT>
</P>
<P>
<FONT size=2 face="serif">Information on how proxies relating to the Trusts&#146; voting securities were voted (if any) by the Advisor during the most recent 12-month period ended June 30th is available, upon request, by calling (800) 699-1BFM or on
the website of the Commission at http://www.sec.gov.</FONT>
</P>
<P>
<FONT size=2 face="serif">The Trusts file their complete schedule of portfolio holdings for the first and third quarters of their respective fiscal years with the Commission on Form N-Q. Each Trust&#146;s Form N-Q will be available on the
Commission&#146;s website at http://www.sec.gov. Each Trust&#146;s Form N-Q, when available, may be reviewed and copied at the Commission&#146;s Public Reference Room in Washington, D.C. Information regarding the operation of the Public Reference
Room may be obtained by calling 1-800-SEC-0330. Each Trust&#146;s Form N-Q, when available, may also be obtained, upon request, by calling (800) 699-1BFM.</FONT>
</P>

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<PAGE>
<A name="page_87"></A>

<p></p><FONT size=1>This report is for shareholder information. This is not a prospectus intended</FONT><BR>
<FONT size=1>for use in the purchase or sale of Trust shares. Statements and other</FONT><BR>
<FONT size=1>information contained in this report are as dated and are subject to change.</FONT><BR>
<p></p>
<IMG src="c34672_ncsrx87x1.jpg" border=0 align=right>
<BR>
<FONT size=1>CEF-ANN-3</FONT><BR>

<HR noshade align="center" width="100%" size=4>

<PAGE>

<P>
<B><FONT face="serif">Item 2. Code of Ethics.</FONT></B><FONT face="serif"> </FONT>
</P>
<P>
<FONT face="serif">(a)  The Registrant has adopted a code of ethics (the "Code of Ethics") that applies to its principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar
functions. </FONT>
</P>
<P>
<FONT face="serif">(b) Not applicable.</FONT>
<P>
<FONT face="serif">(c) The Registrant has not amended its Code of Ethics during the period covered by the shareholder report presented in Item 1 hereto. </FONT>
</P>
<P>
<FONT face="serif">(d)  The Registrant has not granted a waiver or an implicit waiver from a provision of its Code of Ethics during the period covered by the shareholder report presented in Item 1 hereto. </FONT>
</P>
<P>
<FONT face="serif">(e) Not applicable.</FONT>
<P>
<FONT face="serif">(f) The Registrant's Code of Ethics is attached as an Exhibit hereto.</FONT></P>
<P>
<B><FONT face="serif">Item 3. Audit Committee Financial Expert.</FONT></B><FONT face="serif"> </FONT>
</P>
<P>
<FONT face="serif">The Registrant's Board of Trustees has determined that it has two audit committee financial experts serving on its audit committee, each of whom is an "independent" Trustee: Dr. Andrew F. Brimmer and Mr. Kent Dixon. Under
applicable securities laws, a person who is determined to be an audit committee financial expert will not be deemed an "expert" for any purpose, including without limitation for the purposes of Section 11 of the Securities Act of 1933, as a result
of being designated or identified as an audit committee financial expert.  The designation or identification of a person as an audit committee financial expert does not impose on such person any duties, obligations, or liabilities that are greater
than the duties, obligations, and liabilities imposed on such person as a member of the audit committee and Board of Trustees in the absence of such designation or identification. </FONT>
</P>
<P>
<B><FONT face="serif">Item 4. Principal Accountant Fees and Services. </FONT></B>
</P>
<P>
<FONT face="serif">(a)  <U>Audit Fees</U>.  The aggregate fees billed for each of the last two fiscal years for professional services rendered by the principal accountant for the audit of the
Registrant's annual financial statements or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for those fiscal years were $52,500 for the fiscal year ended October 31, 2004 and
$61,300 for the fiscal year ended October 31, 2003. </FONT>
</P>
<P>
<FONT face="serif">(b)  </FONT><U><FONT face="serif">Audit-Related Fees</FONT></U><FONT face="serif">. The aggregate fees billed in each of the last two fiscal years for assurance and related services by the principal accountant that are reasonably
related to the performance of the audit of the Registrant&#146;s financial statements and are not</FONT>
</P>
<P>&nbsp;</P>

<HR noshade align="center" width="100%" size=2>

<PAGE>
<A name="page_3"></A>

<P>
<FONT face="serif">reported above in Item 4(a) were $0 for the fiscal year ended October 31, 2004 and $0 for the fiscal year ended October 31, 2003. The nature of these services was attest services not
required by statute or regulation, overhead and out-of-pocket expenses.</FONT>
<P>
<FONT face="serif">(c) <U>Tax Fees</U>. The aggregate fees billed in each of the
last two fiscal years for professional services rendered by the principal
accountant for tax compliance, tax advice and tax planning were $10,500 for the
fiscal year ended October 31, 2004 and $31,500 for the fiscal year ended October
31, 2003. The nature of these services was federal, state and local income and
excise tax return preparation and related advice and planning and miscellaneous
tax advice.</FONT>
<P>
<FONT face="serif">(d) <U>All Other Fees</U>. There were no fees billed in each of the last two fiscal years for products and services provided by the principal accountant,
other than the services reported above in Items 4(a) through (c).</FONT>
<P>
<FONT face="serif">(e) <U>Audit Committee Pre-Approval Policies and Procedures</U></FONT>
<P>
<FONT face="serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) The Registrant has polices and procedures (the "Policy") for the pre-approval by the Registrant's Audit Committee of Audit, Audit-Related, Tax and Other Services (as each is
defined in the Policy) provided by the Trust's independent auditor (the "Independent Auditor") to the Registrant and other "Covered Entities" (as defined below). The term of any such pre-approval is 12 months from the date of pre-approval, unless
the Audit Committee specifically provides for a different period. The amount of any such pre-approval is set forth in the appendices to the Policy (the "Service Pre-Approval Documents"). At its first meeting of each calendar year, the Audit
Committee will review and re-approve the Policy and approve or re-approve the Service Pre-Approval Documents for that year, together with any changes deemed necessary or desirable by the Audit Committee. The Audit Committee may, from time to time,
modify the nature of the services pre-approved, the aggregate level of fees pre-approved or both.</FONT>

<P>
<FONT face="serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For the purposes of the Policy, "Covered Services" means (A) all engagements for audit and
non-audit services to be provided by the Independent Auditor to the Trust and (B) all engagements for non-audit services related directly to the operations and financial reporting or the Trust to be provided by the Independent Auditor to any Covered
Entity, "Covered Entities" means (1) the Advisor or (2) any entity controlling, controlled by or under common control with the Advisor that provides ongoing services to the Trust.</FONT>
<P>
<FONT face="serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the
intervals between the scheduled meetings of the Audit Committee, the Audit Committee delegates pre-approval authority under this Policy to the Chairman of the Audit Committee (the "Chairman"). The Chairman shall report any pre-approval decisions
under this Policy to the Audit Committee at its next scheduled meeting. At each scheduled meeting, the Audit Committee will review with the Independent Auditor the Covered Services pre-approved by the Chairman pursuant to delegated authority, if
any, and the fees related thereto. Based on these reviews, the Audit Committee can modify, at its discretion, the pre-approval originally granted by the Chairman pursuant to delegated authority. This modification can be to the nature of services
pre-approved, the aggregate level of fees approved, or both. Pre-approval of Covered Services by the Chairman pursuant to delegated authority is expected to be the exception rather than the rule and the</FONT>

<P>
<FONT face="serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></P>

<HR noshade align="center" width="100%" size=2>

<PAGE>
<A name="page_4"></A>

<P>
<FONT face="serif">Audit Committee may modify or withdraw this delegated authority at any time the Audit Committee determines that it is appropriate to do so. </FONT>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">Fee levels for all Covered Services to be provided by the Independent Auditor and pre-approved under this Policy will be established annually by the Audit Committee and set forth in the Service
Pre-Approval Documents.  Any increase in pre-approved fee levels will require specific pre-approval by the Audit Committee (or the Chairman pursuant to delegated authority). </FONT>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">The terms and fees of the annual Audit services engagement for the Trust are subject to the specific pre-approval of the Audit Committee. The Audit Committee (or the Chairman pursuant to delegated
authority) will approve, if necessary, any changes in terms, conditions or fees resulting from changes in audit scope, Trust structure or other matters. </FONT>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">In addition to the annual Audit services engagement specifically approved by the Audit Committee, any other Audit services for the Trust not listed in the Service Pre-Approval Document for the
respective period must be specifically pre-approved by the Audit Committee (or the Chairman pursuant to delegated authority.)</FONT>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">Audit-Related services are assurance and related services that are not required for the audit, but are reasonably related
to the performance of the audit or review of the financial statements of the Registrant and, to the extent they are Covered Services, the other Covered Entities (as defined in the Joint Audit Committee Charter) or that are traditionally performed by
the Independent Auditor.  Audit-Related services that are Covered Services and are not listed in the Service Pre-Approval Document for the respective period must be specifically pre-approved by the Audit Committee (or the Chairman pursuant to
delegated authority). </FONT>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">The Audit Committee believes that the Independent Auditor can provide Tax services to the Covered Entities such as tax compliance, tax planning and tax advice without impairing the auditor&#146;s
independence. However, the Audit Committee will not permit the retention of the Independent Auditor in connection with a transaction initially recommended by the Independent Auditor, the sole business purpose of which may be tax avoidance and the
tax treatment of which may not be supported in the Internal Revenue Code and related regulations. Tax services that are Covered Services and are not listed in the Service Pre-Approval Document for the respective period must be specifically
pre-approved by the Audit Committee (or the Chairman pursuant to delegated authority). </FONT>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">All Other services that are covered and are not listed in the Service Pre-Approval Document for the respective period must be specifically pre-approved by the Audit Committee (or the Chairman pursuant
to delegated authority). </FONT>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">Requests or applications to provide Covered Services that require approval by the Audit Committee (or the Chairman pursuant to delegated authority) must be submitted to the Audit Committee or the
Chairman, as the case may be, by both the Independent Auditor and the Chief Financial Officer of the respective Covered Entity, and must include a joint statement as to whether, in their view, (a) the request or application is consistent with the
rules of the Securities and Exchange Commission ("SEC") on auditor independence and (b) the requested service is or is not a non-audit service prohibited by the SEC.  A request or application submitted to the Chairman between scheduled meetings of
the Audit Committee should include a discussion as to why approval is being sought prior to the next regularly scheduled meeting of the Audit Committee. </FONT>
</P>
<P align="center">
<FONT face="serif"> </FONT>
</P>

<HR noshade align="center" width="100%" size=2>

<PAGE>
<A name="page_5"></A>

<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">(2) None of the services described in each of Items 4(b) through (d) were approved by the audit committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation
S-X.
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">(f) Not applicable.</FONT>
</font>
<P>
<font face="serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) The aggregate non-audit fees billed by the Trust's accountant for services rendered to the Trust, the Advisor (except for any sub-adviser whose role is primarily
portfolio management and is subcontracted with or overseen by another investment adviser) or any entity controlling, controlled by, or under common control with the Advisor that provides ongoing services to the registrant that directly impacted the
Trust for each of the last two fiscal years were $10,500 for the fiscal year ended October 31, 2004 and $31,500 for the fiscal year ended October 31, 2003.</font>
<FONT face="serif"><P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">(h) Not applicable.</FONT>
<P>
<FONT face="serif"><B>Item 5. Audit Committee of Listed Registrants.</B></FONT>
<P>
<FONT face="serif">The Registrant has a separately-designated standing audit committee established in accordance with Section
3(a)(58)(A) of the Securities Exchange Act of 1934. The audit committee of the Registrant is comprised of: Dr. Andrew F. Brimmer; Richard E. Cavanagh; Kent Dixon and Frank Fabozzi.</FONT>
<P>
<FONT face="serif"><B>Item 6. Schedule of Investments.</B></FONT>
<P>
<FONT face="serif">The Registrant&#146;s Schedule of Investments is included as part of the Report to Shareholders filed under Item 1 of this
form.</FONT>
<P>
<FONT face="serif"><B>Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.</B></FONT>
<P>
<FONT face="serif">The Registrant has delegated the voting of proxies
relating to its voting securities to its investment advisor, BlackRock Advisors, Inc. (the "Advisor") and its sub-advisor, BlackRock Financial Management, Inc. (the "Sub-Advisor"). The Proxy Voting Policies and Procedures of the Advisor and
Sub-Advisor (the "Proxy Voting Policies") are attached as an Exhibit 99.PROXYPOL hereto.</FONT>
<P>
<FONT face="serif"><B>Item 8. Portfolio Managers of Closed-End Management Investment Companies</B></FONT>
<P>
<FONT face="serif">Not applicable.</FONT>
<P>
<FONT face="serif"><B>Item 9. Purchases of Equity Securities by Closed-End Management Companies and Affiliated Purchasers.</B></FONT>
<P>
<FONT face="serif">Not applicable.</FONT>
<P>
<FONT face="serif"><B>Item 10. Submission of Matters to a Vote of Security Holders.</B></FONT>
<P>
<FONT face="serif">Not applicable.</FONT>
<P>
<FONT face="serif"><B>Item 11. Controls and Procedures.</B></FONT>
<P>
<FONT face="serif"></FONT>

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<PAGE>
<A name="page_6"></A>

<P>
<FONT face="serif">(a) The Registrant's principal executive officer and principal financial officer have evaluated the Registrant's disclosure controls and procedures as of a date within 90 days of this
filing and have concluded that the Registrant&#146;s disclosure controls and procedures are effective, as of such date, in ensuring that information required to be disclosed by the registrant in this Form N-CSR was recorded, processed, summarized,
and reported timely.</FONT>
<P>
<FONT face="serif">(b) The Registrant's principal executive officer and principal financial officer are aware of no changes in the Registrant's internal control over financial reporting that occurred
during the Registrant's last fiscal half-year that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting.</FONT>
<P>
<FONT face="serif"><B>Item 12. Exhibits.</B></FONT>
<P>
<FONT face="serif">(a)(1) Code of Ethics attached as EX-99.CODE ETH.</FONT>
<P>
<FONT face="serif">(a)(2) Separate certifications of Principal Executive and Financial Officers pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 attached as EX-99.CERT.</FONT>
<P>
<FONT face="serif">(a)(3) Not applicable.</FONT>
<P>
<FONT face="serif">(b) Certification of Principal Executive and Financial Officers pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 furnished as EX-99.906CERT.</FONT>
<P>
<FONT face="serif">Proxy Voting Policies attached as EX-99.PROXYPOL.</FONT>

<P align="center">&nbsp;
</P>

<HR noshade align="center" width="100%" size=2>

<PAGE>
<A name="page_7"></A>

<P align="center">
<B><FONT face="serif">SIGNATURES</FONT></B><FONT face="serif"> </FONT>
</P>
<P>
<FONT face="serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
</FONT>
</P>
<P>
<FONT face="serif">(Registrant)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;BlackRock Income Trust, Inc.
<P>
<FONT face="serif">By: /s/ Henry Gabbay<br>
_______________________________________________________________<br>
Name: Henry Gabbay <br>
Title: Treasurer <br>
Date: January 4, 2005</FONT>
</P>
<P>
<FONT face="serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed by the following persons on behalf of the registrant and in the capacities and on the dates
indicated. </FONT>
</P>

<P>
<FONT face="serif">By: /s/ Robert S. Kapito<br>
_______________________________________________________________<br>
Name: Robert S. Kapito <br>
Title: Principal Executive Officer <br>
Date: January 4, 2005</FONT>
</P>
<P>
<FONT face="serif">By: /s/ Henry Gabbay<br>
_______________________________________________________________<br>
Name: Henry Gabbay <br>
Title: Principal Financial Officer <br>
Date: January 4, 2005</FONT>
</P>
<P align="center">
<FONT face="serif"></FONT>
</P>

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end

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.CODE ETH
<SEQUENCE>7
<FILENAME>c34672_ex99codeeth.htm
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<HTML>
<HEAD>
   <TITLE>c33871_code</TITLE>
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<P align="center">
<B><FONT face="serif">JOINT CODE OF ETHICS<br>
FOR<br>
CHIEF EXECUTIVE AND SENIOR FINANCIAL OFFICERS<br>
OF<br>
THE BLACKROCK CLOSED-END FUNDS </FONT></B>
</P>
<P align="center">
<B><FONT face="serif">AS ADOPTED BY THE BOARDS OF TRUSTEES/DIRECTORS<br>
MAY 2003 </FONT></B>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">Each BlackRock Closed-End Fund (each a &#147;Trust&#148; and, collectively, the <U>&#147;Trusts</U>&#148;)<SUP>1</SUP> is committed to conducting business in accordance with applicable laws, rules and regulations and the highest standards of business ethics, and to full and accurate disclosure -- financial and otherwise
- -- in compliance with applicable law. This Code of Ethics, applicable to the Trust&#146;s Chief Executive Officer, President, Chief Financial Officer and Treasurer (or persons performing similar functions) (together, <U>&#147;Senior</U></FONT><FONT face="serif"><u> Officers</u>&#148;), sets forth policies to guide you in the performance of your duties. </FONT>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">As a Senior Officer, you must comply with applicable law. You also have a responsibility to conduct yourself in an honest and ethical manner. You have leadership responsibilities that include creating
a culture of high ethical standards and a commitment to compliance, maintaining a work environment that encourages the internal reporting of compliance concerns and promptly addressing compliance concerns. </FONT>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">This Code of Ethics recognizes that the Senior Officers are subject to certain conflicts of interest inherent in the operation of investment companies, because the Senior Officers currently or may in
the future serve as Senior Officers of each of the Trusts, as officers or employees of the Trust&#146;s investment advisor (the </FONT><U><FONT face="serif">&#147;Advisor</FONT></U><FONT face="serif">&#148;) and/or affiliates of the Trust&#146;s
investment advisor (collectively with the Advisor, </FONT><U><FONT face="serif">&#147;BlackRock</FONT></U><FONT face="serif">&#148;) and as officers or trustees/directors of other registered investment companies and unregistered investment funds
advised by BlackRock. This Code of Ethics also recognizes that certain laws and regulations applicable to, and certain policies and procedures adopted by, the Trust or BlackRock govern your conduct in connection with many of the conflict of interest
situations that arise in connection with the operations of the Trust, including: </FONT>
</P>
<TABLE width="100%" border=0 cellspacing=0 cellpadding=0>
<TR>  </TR>
</TABLE>

<TABLE width="100%" border=0 cellspacing=0 cellpadding=0>
  <TR>
    <TD width="5%"><hr noshade size=1></TD>
    <TD width="93%">&nbsp;</TD>
  </TR>
  <TR valign="top">
    <TD width="2%"><FONT size=1 face="serif">1</FONT></TD>
    <TD colspan="2"><FONT size=2 face="serif">This Joint Code of Ethics for Chief Executive and Senior Financial Officers has been adopted by</FONT></TD>
  </TR>
  <TR valign="top">
    <TD width="2%">&nbsp;</TD>
    <TD colspan="2"><FONT size=2 face="serif">the Board of Trustees/Directors for each Trust. Solely for the sake of clarity and simplicity, this</FONT></TD>
  </TR>
  <TR valign="top">
    <TD width="2%">&nbsp;</TD>
    <TD colspan="2"><FONT size=2 face="serif">Joint Code of Ethics has been drafted as if there is a single Trust, a single Governance Committee</FONT></TD>
  </TR>
  <TR valign="top">
    <TD width="2%">&nbsp;</TD>
    <TD colspan="2"><FONT size=2 face="serif">and a single Board of Trustees/Directors. The terms &#147;Trustees,&#148; &#147;Independent Trustees&#148; and</FONT></TD>
  </TR>
  <TR valign="top">
    <TD width="2%">&nbsp;</TD>
    <TD colspan="2"><FONT size=2 face="serif">&#147;Governance Committee&#148; mean the Trustees, the Independent Trustees and the Governance</FONT></TD>
  </TR>
  <TR valign="top">
    <TD width="2%">&nbsp;</TD>
    <TD colspan="2"><FONT size=2 face="serif">Committee of each Trust, respectively, unless the context otherwise requires. The Trustees, the</FONT></TD>
  </TR>
  <TR valign="top">
    <TD width="2%">&nbsp;</TD>
    <TD colspan="2"><FONT size=2 face="serif">Independent Trustees and the Governance Committee of each Trust, however, shall act separately</FONT></TD>
  </TR>
  <TR valign="top">
    <TD width="2%">&nbsp;</TD>
    <TD colspan="2"><FONT size=2 face="serif">and in the best interests of its respective Trust.</FONT></TD>
  </TR>
</TABLE>
<p></p><HR noshade align="center" width="100%" size=2>

<PAGE>
<A name="page_2"></A>

<table width="100%"  border="0">
  <tr>
    <td width="5%" valign="top">&nbsp;</td>
    <td width="5%" valign="top">&#149;</td>
    <td width="88%" valign="top"><font face="serif">the Investment Company Act of 1940, and the rules and regulation promulgated thereunder by the Securities and Exchange Commission (the <u>&#147;1940 Act</u>&#148;); </font> </td>
    <td width="1%">&nbsp;</td>
  </tr>
  <tr>
    <td valign="top">&nbsp;</td>
    <td width="5%" valign="top">&nbsp;</td>
    <td valign="top">&nbsp;</td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td valign="top">&nbsp;</td>
    <td width="5%" valign="top">&#149;</td>
    <td valign="top"><font face="serif">the Investment Advisers Act of 1940, and the rules and regulations promulgated thereunder by the Securities and Exchange Commission (the <u><font face="serif">&#147;Advisers Act</font></u><font face="serif">&#148;); </font></font> </td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td valign="top">&nbsp;</td>
    <td width="5%" valign="top">&nbsp;</td>
    <td valign="top">&nbsp;</td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td valign="top">&nbsp;</td>
    <td width="5%" valign="top">&#149;</td>
    <td valign="top"><font face="serif">the Code of Ethics adopted by the Trust and the other Trusts pursuant to Rule 17j-1(c) under the 1940 Act (collectively, the </font><u><font face="serif">&#147;Trust&#146;s 1940 Act</font><font face="serif"> Code of Ethics</font></u><font face="serif">&#148;); </font> </td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td valign="top">&nbsp;</td>
    <td width="5%" valign="top">&nbsp;</td>
    <td valign="top">&nbsp;</td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td valign="top">&nbsp;</td>
    <td width="5%" valign="top">&#149;</td>
    <td valign="top"><font face="serif">one or more codes of ethics adopted by BlackRock that have been reviewed and approved by those trustees/directors (the <u>&#147;Trustees</u>&#148;) of the Trust that are not &#147;interested persons&#148; of the Trust (the <u>&#147;Independent Trustees</u>&#148;) within the meaning of the 1940 Act (the <u>&#147;BlackRock&#146;s 1940</u></font><font face="serif"><u> Act Code of Ethics</u>&#148; and, together with the Trust&#146;s 1940 Act Code of Ethics, the <u>&#147;1940 Act Codes of Ethics</u>&#148;); </font> </td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td valign="top">&nbsp;</td>
    <td width="5%" valign="top">&nbsp;</td>
    <td valign="top">&nbsp;</td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td valign="top">&nbsp;</td>
    <td width="5%" valign="top">&#149;</td>
    <td valign="top"><font face="serif">the policies and procedures adopted by the Trust and the other Trusts to address conflict of interest situations, such as procedures under Rule 10f-3 and Rule 17a-7 under the 1940 Act (collectively, the <u>&#147;Trust Policies</u>&#148;); and </font> </td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td valign="top">&nbsp;</td>
    <td width="5%" valign="top">&nbsp;</td>
    <td valign="top">&nbsp;</td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td valign="top">&nbsp;</td>
    <td width="5%" valign="top">&#149;</td>
    <td valign="top"><font face="serif">BlackRock's general policies and procedures to address, among other things, conflict of interest situations and related matters (collectively, the
    <u><font face="serif">&#147;BlackRock Policies</font></u><font face="serif">&#148;). </font> </font> </td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td width="5%">&nbsp;</td>
    <td>&nbsp;</td>
    <td>&nbsp;</td>
  </tr>
</table>


<P>
<FONT face="serif">The provisions of the 1940 Act, the Advisers Act, the 1940 Act Codes of Ethics, the Trust Policies and the BlackRock Policies are referred to herein collectively as the </FONT>
<u>&#147;Additional Conflict Rules</u><FONT face="serif">&#148;. </FONT>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">This Code of Ethics is different from, and is intended to supplement, the Additional Conflict Rules. Accordingly, a violation of the Additional Conflict Rules by a Senior Officer is hereby deemed not
to be a violation of this Code of Ethics, unless and until the Governance Committee of the Trustees (the <u>&#147;Governance Committee</u>&#148;) shall determine that any such violation of the Additional Conflict Rules is also a violation of this Code of
Ethics. </FONT>
</P>
<P>
<B><FONT face="serif">Senior Officers Should Act Honestly and Candidly </FONT></B>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">Each Senior Officer has a responsibility to the Trust to act with integrity. Integrity requires, among other things, being honest and candid. Deceit and subordination of principle are inconsistent
with integrity. </FONT>
</P>
<P>
<FONT face="serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each Senior Officer must: </FONT>
</P>
<P align="center">
<FONT face="serif">2</FONT>
</P>

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<PAGE>
<A name="page_3"></A>

<table width="100%"  border="0">
  <tr>
    <td width="5%" valign="top">&nbsp;</td>
    <td width="5%" valign="top">&#149;</td>
    <td width="91%" valign="top"><font face="serif">act with integrity, including being honest and candid while still maintaining the confidentiality of information where required by law or the Additional Conflict Rules; </font> </td>
    <td width="2%">&nbsp;</td>
  </tr>
  <tr>
    <td width="5%" valign="top">&nbsp;</td>
    <td valign="top">&nbsp;</td>
    <td valign="top">&nbsp;</td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td width="5%" valign="top">&nbsp;</td>
    <td valign="top">&#149;</td>
    <td valign="top"><font face="serif">comply with the laws, rules and regulations that govern the conduct of the Trust&#146;s operations and report any suspected violations thereof in accordance with the section below entitled &#147;Compliance With Code Of Ethics&#148;; and </font> </td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td width="5%" valign="top">&nbsp;</td>
    <td valign="top">&nbsp;</td>
    <td valign="top">&nbsp;</td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td width="5%" valign="top">&nbsp;</td>
    <td valign="top">&#149;</td>
    <td valign="top"><font face="serif">adhere to a high standard of business ethics. </font> </td>
    <td>&nbsp;</td>
  </tr>
</table>
<P>
<B><FONT face="serif">Conflicts Of Interest</FONT></B><FONT face="serif"> </FONT>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">A conflict of interest for the purpose of this Code of Ethics occurs when your private interests interfere in any way, or even appear to interfere, with the interests of the Trust. </FONT>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">Senior Officers are expected to use objective and unbiased standards when making decisions that affect the Trust, keeping in mind that Senior Officers are subject to certain inherent conflicts of
interest because Senior Officers of a Trust also are or may be officers of other Trusts, BlackRock and other funds advised or serviced by BlackRock (as a result of which it is incumbent upon you to be familiar with and to seek to comply with the
Additional Conflict Rules). </FONT>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">You are required to conduct the business of the Trust in an honest and ethical manner, including the ethical handling of actual or apparent conflicts of interest between personal and business
relationships. When making any investment, accepting any position or benefits, participating in any transaction or business arrangement or otherwise acting in a manner that creates or appears to create a conflict of interest with respect to the
Trust where you are receiving a personal benefit, you should act in accordance with the letter and spirit of this Code of Ethics. </FONT>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">If you are in doubt as to the application or interpretation of this Code of Ethics to you as a Senior Officer of the Trust, you should make full disclosure of all relevant facts and circumstances to
the general counsel of BlackRock (the <U>&#147;General</U></FONT><FONT face="serif"><u> Counsel</u>&#148;) and obtain the approval of the General Counsel prior to taking action.</FONT><SUP><FONT face="serif"> </FONT></SUP>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">Some conflict of interest situations that should always be approved by the General Counsel, if material, include the following: </FONT>
</P>
<P>
<table width="100%"  border="0">
  <tr>
    <td width="5%" valign="top">&nbsp;</td>
    <td width="5%" valign="top">&#149;</td>
    <td width="90%" valign="top"><FONT face="serif">the receipt of any entertainment or non-nominal gift by the Senior Officer, or a member of his or her family, from any company with which the Trust has current or prospective business dealings (other than BlackRock), unless such entertainment or gift is business related, reasonable in cost, appropriate as to time and place, and not so frequent as to raise any question of impropriety; </FONT>  </td>
    <td width="2%">&nbsp;</td>
  </tr>
</table>
<p></P>
<P align="center">
<FONT face="serif">3</FONT>
</P>
<P>&nbsp;</P>

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<PAGE>
<A name="page_4"></A>

<table width="100%"  border="0">
  <tr>
    <td width="5%" valign="top">&nbsp;</td>
    <td width="5%" valign="top">&#149;</td>
    <td width="90%" valign="top"><font face="serif">any ownership interest in, or any consulting or employment relationship with, any of the Trust&#146;s service providers, other than BlackRock; or </font> </td>
    <td width="2%">&nbsp;</td>
  </tr>
  <tr>
    <td width="5%" valign="top">&nbsp;</td>
    <td width="5%" valign="top">&nbsp;</td>
    <td valign="top">&nbsp;</td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td width="5%" valign="top">&nbsp;</td>
    <td width="5%" valign="top">&#149;</td>
    <td valign="top"><font face="serif">a direct or indirect financial interest in commissions, transaction charges or spreads paid by the Trust for effecting portfolio transactions or for selling or redeeming shares other than an interest arising from the Senior Officer's employment by BlackRock, such as compensation or equity ownership. </font> </td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td width="5%" valign="top">&nbsp;</td>
    <td width="5%" valign="top">&nbsp;</td>
    <td valign="top">&nbsp;</td>
    <td>&nbsp;</td>
  </tr>
</table>

<P>
<B><FONT face="serif">Disclosures </FONT></B>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">It is the policy of the Trust to make full, fair, accurate, timely and understandable disclosure in compliance with all applicable laws and regulations in all reports and documents that the Trust
files with, or submits to, the Securities and Exchange Commission or a national securities exchange and in all other public communications made by the Trust. As a Senior Officer, you are required to promote compliance with this policy and to abide
by the Trust&#146;s standards, policies and procedures designed to promote compliance with this policy.  </FONT>
</P>
<table width="100%"  border="0">
  <tr>
    <td>&nbsp;</td>
    <td valign="top">&nbsp;</td>
    <td valign="top"><P> <FONT face="serif">Each Senior Officer must: </FONT> </P></td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td valign="top">&nbsp;</td>
    <td valign="top">&nbsp;</td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td width="5%">&nbsp;</td>
    <td width="5%" valign="top">&#149;</td>
    <td width="84%" valign="top"><font face="serif">familiarize himself or herself with the disclosure requirements applicable to the Trust as well as the business and financial operations of the Trust; and </font> </td>
    <td width="6%">&nbsp;</td>
  </tr>
  <tr>
    <td width="5%">&nbsp;</td>
    <td width="5%" valign="top">&nbsp;</td>
    <td valign="top">&nbsp;</td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td width="5%">&nbsp;</td>
    <td width="5%" valign="top">&#149;</td>
    <td valign="top"><font face="serif">not knowingly misrepresent, or cause others to misrepresent, facts about the Trust to others, including to the Trustees, the Trust&#146;s independent auditors, the Trust&#146;s counsel, counsel to the Independent Trustees, governmental regulators or self-regulatory organizations. </font> </td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td width="5%">&nbsp;</td>
    <td width="5%" valign="top">&nbsp;</td>
    <td valign="top">&nbsp;</td>
    <td>&nbsp;</td>
  </tr>
</table>

<P>
<B><FONT face="serif">Compliance With Code Of Ethics </FONT></B>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">If you know of or suspect a violation of this Code of Ethics or other laws, regulations, policies or procedures applicable to the Trust, you must report that information on a timely basis to the
General Counsel or report it anonymously by following the &#147;whistle blower&#148; policies adopted by BlackRock from time to time. </FONT><I><FONT face="serif">No one will be subject to retaliation because of a good faith report of a suspected
violation</FONT></I><FONT face="serif">. </FONT>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">The Trust will follow these procedures in investigating and enforcing this Code of Ethics, and in reporting on this Code of Ethics: </FONT>
</P>
<table width="100%"  border="0">
  <tr>
    <td width="5%">&nbsp;</td>
    <td width="5%" valign="top">&#149;</td>
    <td width="85%" valign="top"><font face="sans-serif"></font><font face="serif">the General Counsel will take all appropriate action to investigate any actual or potential violations reported to him or her; </font> </td>
    <td width="5%">&nbsp;</td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td valign="top">&nbsp;</td>
    <td valign="top">&nbsp;</td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td valign="top">&#149;</td>
    <td valign="top"><font face="sans-serif"></font><font face="serif">violations and potential violations will be reported to the Governance Committee after such investigation; </font> </td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td valign="top">&nbsp;</td>
    <td valign="top">&nbsp;</td>
    <td>&nbsp;</td>
  </tr>
</table>
<P align="left">&nbsp;</P>
<P align="left">&nbsp;</P>
<P align="center">
<FONT face="serif">4</FONT>
</P>
<P>&nbsp;</P>

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<PAGE>
<A name="page_5"></A>

<table width="100%"  border="0">
  <tr>
    <td width="5%">&nbsp;</td>
    <td width="5%" valign="top">&#149;</td>
    <td width="85%" valign="top"><font face="serif">if the Governance Committee determines that a violation has occurred, it will take all appropriate disciplinary or preventive action; and </font> </td>
    <td width="4%">&nbsp;</td>
  </tr>
  <tr>
    <td width="5%">&nbsp;</td>
    <td valign="top">&nbsp;</td>
    <td valign="top">&nbsp;</td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td width="5%">&nbsp;</td>
    <td valign="top">&#149;</td>
    <td valign="top"><font face="serif">appropriate disciplinary or preventive action may include a letter of censure, suspension, dismissal or, in the event of criminal or other serious violations of law, notification of the Securities and Exchange Commission or other appropriate law enforcement authorities. </font> </td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td width="5%">&nbsp;</td>
    <td valign="top">&nbsp;</td>
    <td valign="top">&nbsp;</td>
    <td>&nbsp;</td>
  </tr>
</table>

<P>
<B><FONT face="serif">Waivers Of Code Of Ethics </FONT></B>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">Except as otherwise provided in this Code of Ethics, the General Counsel is responsible for applying this Code of Ethics to specific situations in which questions are presented to the General Counsel
and has the authority to interpret this Code of Ethics in any particular situation. The General Counsel shall take all action he or she considers appropriate to investigate any actual or potential violations reported under this Code of Ethics.
</FONT>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">The General Counsel is authorized to consult, as appropriate, with the chair of the Governance Committee and with counsel to the Trust, BlackRock or the Independent Trustees, and is encouraged to do
so. </FONT>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">The Governance Committee is responsible for granting waivers of this Code of Ethics, as appropriate. Any changes to or waivers of this Code of Ethics will, to the extent required, be disclosed on Form
N-CSR, or otherwise, as provided by Securities and Exchange Commission rules.</FONT>
</P>
<P>
<B><FONT face="serif">Recordkeeping </FONT></B>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">The Trust will maintain and preserve for a period of not less than six (6) years from the date an action is taken, the first two (2) years in an easily accessible place, a copy of the information or
materials supplied to the Governance Committee: </FONT>
</P>
<table width="100%"  border="0">
  <tr>
    <td width="5%" valign="top">&nbsp;</td>
    <td width="5%" valign="top">&#149;</td>
    <td width="84%" valign="top"><font face="serif">that provided the basis for any amendment or waiver to this Code of Ethics; and </font> </td>
    <td width="6%">&nbsp;</td>
  </tr>
  <tr>
    <td valign="top">&nbsp;</td>
    <td valign="top">&nbsp;</td>
    <td valign="top">&nbsp;</td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td valign="top">&nbsp;</td>
    <td valign="top">&#149;</td>
    <td valign="top"><font face="serif">relating to any violation of this Code of Ethics and sanctions imposed for such violation, together with a written record of the approval or action taken by the Governance Committee. </font> </td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td valign="top">&nbsp;</td>
    <td valign="top">&nbsp;</td>
    <td valign="top">&nbsp;</td>
    <td>&nbsp;</td>
  </tr>
</table>

<P>
<B><FONT face="serif">Confidentiality </FONT></B>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">All reports and records prepared or maintained pursuant to this Code of Ethics shall be considered confidential and shall be maintained and protected accordingly. Except as otherwise required by law
or this Code of Ethics, such matters shall not be disclosed to anyone other than the Independent Trustees and their counsel, the Trust and its counsel, BlackRock and its counsel and any other advisors, consultants or counsel retained by the
Trustees, the Independent Trustees or any committee of the Trustees. </FONT>
</P>
<P align="center">
<FONT face="serif">5 </FONT>
</P>
<P>&nbsp;</P>

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<PAGE>
<A name="page_6"></A>

<P>
<B><FONT face="serif">Amendments </FONT></B>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">This Code of Ethics may not be amended except in written form, which is specifically approved by a majority vote of the Trustees, including a majority of the Independent Trustees. </FONT>
</P>
<P>
<B><FONT face="serif">No Rights Created </FONT></B>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">This Code of Ethics is a statement of certain fundamental principles, policies and procedures that govern each of the Senior Officers in the conduct of the Trust's business. It is not intended to and
does not create any rights in any employee, investor, supplier, competitor, shareholder or any other person or entity. </FONT>
</P>
<P align="center">
<FONT face="serif">6</FONT>
</P>
<P>&nbsp;</P>

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<PAGE>
<A name="page_7"></A>

<P align="center">
<FONT face="serif">ACKNOWLEDGMENT FORM </FONT>
</P>
<P>
<FONT face="serif">I have received and read the Joint Code of Ethics for Chief Executive and Senior Financial Officers, and I understand its contents. I agree to comply fully with the standards contained in the Code of Ethics and the Company's
related policies and procedures. I understand that I have an obligation to report any suspected violations of the Code of Ethics on a timely basis to the General Counsel or report it anonymously by following the &#147;whistle blower&#148; policies
adopted by BlackRock from time to time. </FONT>
</P>
<p></p><TABLE width="100%" border=0 cellspacing=0 cellpadding=0>
<TR>
  <TD>&nbsp;</TD>
  <TD><hr noshade align="left" width=50% size=1></TD>
</TR>
<TR>
  <TD width="50%">&nbsp;</TD>
   <TD width="50%"><FONT face="serif">Printed Name</FONT></TD>
</TR>
<TR>
  <TD>&nbsp;</TD>
   <TD>&nbsp;</TD>
</TR>
<TR>
  <TD>&nbsp;</TD>
   <TD><hr noshade align="left" width=50% size=1></TD>
</TR>
<TR>
  <TD>&nbsp;</TD>
   <TD><FONT face="serif">Signature</FONT></TD>
</TR>
<TR>
  <TD>&nbsp;</TD>
   <TD>&nbsp;</TD>
</TR>
<TR>
  <TD>&nbsp;</TD>
   <TD><hr noshade align="left" width=50% size=1></TD>
</TR>
<TR>
  <TD>&nbsp;</TD>
   <TD><FONT face="serif">Date</FONT></TD>
</TR>
</TABLE>
<P align="center">
<FONT face="serif">7</FONT>
</P>
<P>&nbsp;</P>

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</BODY>

</HTML>


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.CERT
<SEQUENCE>8
<FILENAME>c34672_ex99cert.htm
<TEXT>

<html>
<head>
<title>Untitled Document</title>
</head>

<body>


<P align="right">
<B><FONT face="serif">EX-99.CERT </FONT></B>
</P>
<P align="center">
<B><FONT face="serif">CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER </FONT></B>
</P>
<P>
<B><U><FONT face="serif">CERTIFICATIONS</FONT></U></B><B><FONT face="serif"> </FONT></B>
</P>
<P>
<FONT face="serif">I, Robert Kapito, certify that: </FONT>
</P>
<P>
<FONT face="serif">1. I have reviewed this report on Form N-CSR of BlackRock Income Trust, Inc.; </FONT>
</P>
<P>
<FONT face="serif">2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were
made, not misleading with respect to the period covered by this report; </FONT>
</P>
<P>
<FONT face="serif">3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash
flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; </FONT>
</P>
<P>
<FONT face="serif">4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) for the registrant
and have: </FONT>
</P>
<P>
<FONT face="serif">a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; </FONT>
</P>
<P>
<FONT face="serif">b)</FONT><FONT size=2 face="sans-serif"></FONT><FONT face="serif"> Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the
disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and</FONT><FONT size=2 face="sans-serif"> </FONT>
</P>
<P>
<FONT face="serif">c) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an
annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and </FONT>
</P>
<P>
<FONT face="serif">5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): </FONT>
</P>
<P align="center">&nbsp;

</P>

<HR noshade align="center" width="100%" size=2>

<PAGE>
<A name="page_9"></A>

<P>
<FONT face="serif">a) All significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process,
summarize, and report financial information; and </FONT>
</P>
<P>
<FONT face="serif">b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls. </FONT>
</P>
<P>
<FONT face="serif">Date: January 4, 2005</FONT>
</P>
<table width="100%"  border="0">
  <tr>
    <td width="39%">&nbsp;</td>
    <td width="25%"><font face="serif">/s/ Robert S. Kapito</font></td>
    <td width="36%">&nbsp;</td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td><hr noshade size=1></td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td><font face="serif">Robert S. Kapito</font></td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td><font face="serif">Principal Executive Officer</font></td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td>&nbsp;</td>
    <td>&nbsp;</td>
  </tr>
</table>
<P>
<FONT face="serif"><br>
<br>
<br>
</FONT>
</P>

<HR noshade align="center" width="100%" size=2>

<PAGE>
<A name="page_10"></A>

<P>
<B><FONT face="serif">EX-99.CERT </FONT></B>
</P>
<P>
<B><FONT face="serif">CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER </FONT></B>
</P>
<P>
<B><U><FONT face="serif">CERTIFICATIONS</FONT></U></B><B><FONT face="serif"> </FONT></B>
</P>
<P>
<FONT face="serif">I, Henry Gabbay, certify that: </FONT>
</P>
<P>
<FONT face="serif">1. I have reviewed this report on Form N-CSR of BlackRock  Income Trust, Inc.; </FONT>
</P>
<P>
<FONT face="serif">2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were
made, not misleading with respect to the period covered by this report; </FONT>
</P>
<P>
<FONT face="serif">3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash
flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; </FONT>
</P>
<P>
<FONT face="serif">4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) for the registrant
and have: </FONT>
</P>
<P>
<FONT face="serif">a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; </FONT>
</P>
<P>
<FONT face="serif">b) </FONT><FONT size=2 face="sans-serif"></FONT><FONT face="serif">Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the
disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and</FONT><FONT size=2 face="sans-serif"> </FONT>
</P>
<P>
<FONT face="serif">c) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an
annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and </FONT>
</P>
<P>
<FONT face="serif">5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): </FONT>
</P>
<P align="center">&nbsp;
</P>

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<A name="page_11"></A>

<P>
<FONT face="serif">a) All significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process,
summarize, and report financial information; and </FONT>
</P>
<P>
<FONT face="serif">b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls. </FONT>
</P>
<P>
<FONT face="serif">Date: January 4, 2005</FONT>
</P>
<table width="100%"  border="0">
  <tr>
    <td width="37%">&nbsp;</td>
    <td width="27%"><font face="serif">/s/ Henry Gabbay</font></td>
    <td width="36%">&nbsp;</td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td><hr noshade size=1></td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td><font face="serif">Henry Gabbay</font></td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td><font face="serif">Principal Financial Officer </font> </td>
    <td>&nbsp;</td>
  </tr>
  <tr>
    <td>&nbsp;</td>
    <td>&nbsp;</td>
    <td>&nbsp;</td>
  </tr>
</table>
<P>
<FONT face="serif"><br>
<br>
<br>
</FONT></P>
<P align="center">&nbsp;

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</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.906CERT
<SEQUENCE>9
<FILENAME>c34672_ex99-906cert.htm
<TEXT>

<html>
<head>
<title>Untitled Document</title>
</head>

<body>
<P>
<B><U><FONT face="serif">SECTION 906 CERTIFICATION</FONT></U></B><FONT face="serif"> </FONT>
</P>
<P>
<FONT face="serif">Pursuant to 18 U.S.C. &sect; 1350, the undersigned officers of BlackRock Income Trust, Inc.  (the "Company"), hereby certifies, to the best of their knowledge, that the Company's Report on Form N-CSR for the
period ended October 31, 2004, (the "Report") fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934 and that the information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of the Company. </FONT>
</P>
<P>
<FONT face="serif">Dated: January 4, 2005</FONT>
</P>
<p></p><P>
<FONT face="serif">/s/ Robert S. Kapito<br>
___________________________________________<br>
Name: Robert S. Kapito<br>
Title: Principal Executive Officer</FONT>
</P>
<p></p><P>
<FONT face="serif">/s/ Henry Gabbay<br>
____________________________________________<br>
Name: Henry Gabbay </FONT>
<br>
Title: Principal Financial Officer
</P>
<P align="center">&nbsp;
</P>

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</P>




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</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.PROXYPOL
<SEQUENCE>10
<FILENAME>c34672_ex99proxypol.htm
<TEXT>
<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 3.2 FINAL//EN">


<HTML>
<HEAD>
   <TITLE>c33871_public</TITLE>
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<BODY bgcolor="#ffffff">



<P align="center">
<B><U><FONT face="serif">PROXY VOTING POLICY</FONT></U></B><FONT face="serif"> </FONT>
</P>
<P align="center">
<B><FONT face="serif">For </FONT></B>
</P>
<P align="center">
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><U><FONT face="serif">BlackRock Advisors, Inc.<br>
and Its Affiliated Registered Investment Advisers</FONT></U></B>
</P>
<P>
<U><FONT face="serif">Introduction</FONT></U><FONT face="serif"> </FONT>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">This Proxy Voting Policy ("Policy") for BlackRock Advisors, Inc. and its affiliated registered investment advisers ("BlackRock") reflects our duty as a fiduciary under the Investment Advisers Act of
1940 (the &#147;Advisers Act&#148;) to vote proxies in the best interests of our clients. In addition, the Department of Labor views the fiduciary act of managing ERISA plan assets to include the voting of proxies. Proxy voting decisions must be
made solely in the best interests of the pension plan&#146;s participants and beneficiaries. The Department of Labor has interpreted this requirement as prohibiting a fiduciary from subordinating the retirement income interests of participants and
beneficiaries to unrelated objectives. The guidelines in this Policy have been formulated to ensure decision-making consistent with these fiduciary responsibilities. </FONT>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">Any general or specific proxy voting guidelines provided by an advisory client or its designated agent in writing will supercede the specific guidelines in this Policy. BlackRock will disclose to our
advisory clients information about this Policy as well as disclose to our clients how they may obtain information on how we voted their proxies. Additionally, BlackRock will maintain proxy voting records for our advisory clients consistent with the
Advisers Act. For those of our clients that are registered investment companies, BlackRock will disclose this Policy to the shareholders of such funds and make filings with the Securities and Exchange Commission and make available to fund
shareholders the specific proxy votes that we cast in shareholder meetings of issuers of portfolio securities in accordance with the rules and regulations under the Investment Company Act of 1940.</FONT>
</P>
<P>
<FONT face="serif"> 	Registered investment companies that are advised by BlackRock as well as certain of our advisory clients may participate in securities lending programs, which may reduce or eliminate the amount of shares eligible for voting by
BlackRock in accordance with this Policy if such shares are out on loan and cannot be recalled in time for the vote. </FONT>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">Implicit in the initial decision to retain or invest in the security of a corporation is approval of its existing corporate ownership structure, its management, and its operations. Accordingly, proxy
proposals that would change the existing status of a corporation will be reviewed carefully and supported only when it seems clear that the proposed changes are likely to benefit the corporation and its shareholders. Notwithstanding this favorable
predisposition, management will be assessed on an ongoing basis both in terms of its business capability and its dedication to the shareholders to ensure that our continued confidence remains warranted. If it is determined that management is acting
on its own behalf instead of for the well being of the corporation, we will vote to support</FONT>
</P>
<P align="center">
<FONT size=1 face="serif"> 	</FONT><FONT face="serif">1</FONT>
</P>

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<PAGE>
<A name="page_2"></A>

<P>
<FONT face="serif">shareholder proposals, unless other mitigating circumstances are present. </FONT>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">Additionally, situations may arise that involve an actual or perceived conflict of interest. For example, we may manage assets of a pension plan of a company whose management is soliciting proxies, or
a BlackRock employee involved with managing an account may have a close relative who serves as a director or executive of a company that is soliciting proxies regarding securities held in such account. In all cases, the manner in which we vote
proxies must be based on our clients&#146; best interests and not the product of a conflict.</FONT>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">This Policy and its attendant recommendations attempt to generalize a complex subject. It should be clearly understood that specific fact situations, including differing voting practices in
jurisdictions outside the United States, might warrant departure from these guidelines. In such instances, the relevant facts will be considered, and if a vote contrary to these guidelines is indicated it will be cast and the reasons therefor
recorded in writing. </FONT>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">Section I of the Policy describes proxy proposals that may be characterized as routine and lists examples of the types of proposals we would typically support.  Section II of the Policy describes
various types of non-routine proposals and provides general voting guidelines. These non-routine proposals are categorized as those involving: </FONT>
</P>
<TABLE width=50%>
<TR>
  <TD valign="top" width="20%">&nbsp;</TD>
   <TD valign="top" width="10%"><FONT face="serif">A.</FONT><BR>&nbsp;&nbsp;</TD>
   <TD width="70%" valign="top"><FONT face="serif">Social Issues,</FONT><BR></TD>
</TR>
<TR>
  <TD valign="top" width="20%">&nbsp;</TD>
   <TD valign="top" width="10%"><FONT face="serif">B.</FONT><BR>&nbsp;&nbsp;</TD>
   <TD valign="top"><FONT face="serif">Financial/Corporate Issues, and</FONT><BR></TD>
</TR>
<TR>
  <TD valign="top" width="20%">&nbsp;</TD>
   <TD valign="top" width="10%"><FONT face="serif">C.</FONT><BR>&nbsp;&nbsp;</TD>
   <td valign="top"><FONT face="serif">Shareholder Rights.</FONT><BR>   </td>
</tr>
</TABLE>
<P>
<FONT face="serif">Finally, Section III of the Policy describes the procedures to be followed in casting a vote pursuant to these guidelines. </FONT>
</P>
<P align="center">
<FONT face="serif">2</FONT>
</P>

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<PAGE>
<A name="page_3"></A>

<P align="center">
<FONT face="serif">SECTION I </FONT>
</P>
<P align="center">
<U><FONT face="serif">ROUTINE MATTERS</FONT></U><FONT face="serif"> </FONT>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">Routine proxy proposals, amendments, or resolutions are typically proposed by management and meet the following criteria: </FONT>
</P>
<TABLE width=100%>
<TR>
   <TD valign="top" width="5%"><FONT face="serif">1.</FONT><BR>&nbsp;&nbsp;</TD>
   <td valign="top"><FONT face="serif">They do not measurably change the structure, management control, or operation of the corporation.</FONT><BR></td>
</tr>
<tr>
   <td valign="top" width="3%"><FONT face="serif">2.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">They are consistent with industry standards as well as the corporate laws of the state of incorporation.</FONT><BR>   </td>
</tr>
</TABLE>
<P align="center">
<U><FONT face="serif">Voting Recommendation</FONT></U><FONT face="serif"> </FONT>
</P>
<P>
<FONT face="serif">BlackRock will normally support the following routine proposals:</FONT>
</P>
<TABLE width=100%>
<TR>
   <TD valign="top" width="5%"><FONT face="serif">1.</FONT><BR>&nbsp;&nbsp;</TD>
   <td valign="top"><FONT face="serif">To increase authorized common shares.</FONT><BR></td>
</tr>
<tr>
   <td valign="top" width="3%"><FONT face="serif">2.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To increase authorized preferred shares as long as there are not disproportionate voting rights per preferred share.</FONT><BR></td>
</tr>
<tr>
   <td valign="top" width="3%"><FONT face="serif">3.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To elect or re-elect directors.</FONT><BR></td>
</tr>
<tr>
   <td valign="top" width="3%"><FONT face="serif">4.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To appoint or elect auditors.</FONT><BR></td>
</tr>
<tr>
   <td valign="top" width="3%"><FONT face="serif">5.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To approve indemnification of directors and limitation of directors&#146; liability.</FONT><BR></td>
</tr>
<tr>
   <td valign="top" width="3%"><FONT face="serif">6.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To establish compensation levels.</FONT><BR></td>
</tr>
<tr>
   <td valign="top" width="3%"><FONT face="serif">7.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To establish employee stock purchase or ownership plans.</FONT><BR></td>
</tr>
<tr>
   <td valign="top" width="3%"><FONT face="serif">8.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To set time and location of annual meeting.</FONT><BR>   </td>
</tr>
</TABLE>
<P align="center">
<FONT face="serif">3</FONT>
</P>

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<PAGE>
<A name="page_4"></A>

<P align="center">
<FONT face="serif">SECTION II </FONT>
</P>
<P align="center">
<U><FONT face="serif">NON-ROUTINE PROPOSALS</FONT></U>
</P>
<p>A.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<u><font face="serif">Social Issues</font></u>
<p><font face="serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proposals in this category involve issues of social conscience. They are typically proposed by shareholders who believe that the corporation&#146;s internally adopted policies are ill-advised or misguided.</font>

<tr>
    <td width="5%">&nbsp;</td>
    <td>&nbsp;</td>
</tr>

<center>
  <BR>
  <U><FONT face="serif">Voting Recommendation</FONT></U>
</center>
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">If we have determined that management is generally
socially responsible, we will generally vote </FONT><U><FONT face="serif">against </FONT></U><FONT face="serif">the following shareholder proposals:</FONT><BR>

<TABLE width=100%>
<TR>
   <TD valign="top" width="5%"><FONT face="serif">1.</FONT><BR>&nbsp;&nbsp;</TD>
   <td valign="top"><FONT face="serif">To enforce restrictive energy policies.</FONT><BR></td>
</tr>
<tr>
   <td valign="top" width="3%"><FONT face="serif">2.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To place arbitrary restrictions on military contracting.</FONT><BR></td>
</tr>
<tr>
   <td valign="top" width="3%"><FONT face="serif">3.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To bar or place arbitrary restrictions on trade with other countries.</FONT><BR></td>
</tr>
<tr>
   <td valign="top" width="3%"><FONT face="serif">4.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To restrict the marketing of controversial products.</FONT><BR></td>
</tr>
<tr>
   <td valign="top" width="3%"><FONT face="serif">5.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To limit corporate political activities.</FONT><BR></td>
</tr>
<tr>
   <td valign="top" width="3%"><FONT face="serif">6.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To bar or restrict charitable contributions.</FONT><BR></td>
</tr>
<tr>
   <td valign="top" width="3%"><FONT face="serif">7.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To enforce a general policy regarding human rights based on arbitrary parameters.</FONT><BR></td>
</tr>
<tr>
   <td valign="top" width="3%"><FONT face="serif">8.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To enforce a general policy regarding employment practices based on arbitrary parameters.</FONT><BR></td>
</tr>
<tr>
   <td valign="top" width="3%"><FONT face="serif">9.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To enforce a general policy regarding animal rights based on arbitrary parameters.</FONT><BR></td>
</tr>
<tr>
   <td valign="top" width="3%"><FONT face="serif">10.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To place arbitrary restrictions on environmental practices.</FONT><BR>   </td>
</tr>
</TABLE>
<p></p><FONT face="serif">B.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Financial/Corporate Issues</U></FONT>
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">Proposals in this category are usually offered by management and seek to change a corporation&#146;s legal, business or financial
structure.</FONT><BR>

<P align="center">
<FONT face="serif">4</FONT>
</P>

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<P align="center">
<U><FONT face="serif">Voting Recommendation</FONT></U><FONT face="serif"> </FONT>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">We will generally vote in favor of the following management proposals provided the position of current shareholders is preserved or enhanced: </FONT>
</P>
<TABLE width=100%>
<TR>
   <td valign="top" width="3%">&nbsp;</td>
   <TD valign="top" width="5%"><FONT face="serif">1.</FONT><BR>&nbsp;&nbsp;</TD>
   <td valign="top"><FONT face="serif">To change the state of incorporation.</FONT><BR></td>
</tr>
<tr>
   <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" width="5%"><FONT face="serif">2.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To approve mergers, acquisitions or dissolution.</FONT><BR></td>
</tr>
<tr>
   <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" width="5%"><FONT face="serif">3.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To institute indenture changes.</FONT><BR></td>
</tr>
<tr>
   <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" width="5%"><FONT face="serif">4.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To change capitalization.</FONT><BR></td>
</tr>
<tr>
   <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" colspan="2"><BR></td>
</tr>
</TABLE>
<p><FONT face="serif">C.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Shareholder Rights</U></FONT><P>
<FONT face="serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proposals in this category are made regularly both by management and shareholders. They can be generalized as involving issues that transfer or realign board or shareholder voting power. </FONT>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">We typically would oppose any proposal aimed solely at thwarting potential takeover offers by requiring, for example, super-majority approval. At the same time, we believe stability and continuity
promote profitability. The guidelines in this area seek to find a middle road, and they are no more than guidelines. Individual proposals may have to be carefully assessed in the context of their particular circumstances. </FONT>
</P>
<P align="center">
<U><FONT face="serif">Voting Recommendation</FONT></U><FONT face="serif"> </FONT>
</P>
<P>
<FONT face="serif">We will generally vote </FONT><U><FONT face="serif">for</FONT></U><FONT face="serif"> the following management proposals: </FONT>
</P>
<TABLE width=100%>
<TR>
  <TD valign="top" width="5%">&nbsp;</TD>
   <TD valign="top" width="5%"><FONT face="serif">1.</FONT><BR>&nbsp;&nbsp;</TD>
   <td valign="top"><FONT face="serif">To require majority approval of shareholders in acquisitions of a controlling share in the corporation.</FONT><BR></td>
</tr>
<tr>
  <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" width="3%"><FONT face="serif">2.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To institute staggered board of directors.</FONT><BR></td>
</tr>
<tr>
  <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" width="3%"><FONT face="serif">3.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To require shareholder approval of not more than 66 2/3% for a proposed amendment to the corporation&#146;s by-laws.</FONT><BR></td>
</tr>
<tr>
  <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" width="3%"><FONT face="serif">4.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To eliminate cumulative voting.</FONT><BR></td>
</tr>
<tr>
  <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" width="3%"><FONT face="serif">5.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To adopt anti-greenmail charter or by-law amendments or to otherwise restrict a company&#146;s ability to make greenmail payments.</FONT><BR>   </td>
</tr>
</TABLE>
<P align="center">
<FONT face="serif">5</FONT>
</P>

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<TABLE width=100%>
<TR>
  <TD valign="top" width="5%">&nbsp;</TD>
   <TD valign="top" width="5%"><FONT face="serif">6.</FONT><BR>&nbsp;&nbsp;</TD>
   <td valign="top"><FONT face="serif">To create a dividend reinvestment program.</FONT><BR></td>
</tr>
<tr>
  <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" width="3%"><FONT face="serif">7.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To eliminate preemptive rights.</FONT><BR></td>
</tr>
<tr>
  <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" width="3%"><FONT face="serif">8.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To eliminate any other plan or procedure designed primarily to discourage a takeover or other similar action (commonly known as a &#147;poison pill&#148;).</FONT><BR>   </td>
</tr>
</TABLE>
<P>
<FONT face="serif">We will generally vote </FONT><U><FONT face="serif">against</FONT></U><FONT face="serif"> the following management proposals:</FONT>
</P>
<TABLE>
<TR>
  <TD valign="top" width="5%">&nbsp;</TD>
   <TD valign="top" width="5%"><FONT face="serif">1.</FONT><BR>&nbsp;&nbsp;</TD>
   <td valign="top"><FONT face="serif">To require greater than 66 2/3% shareholder approval for a proposed amendment to the corporation&#146;s by-laws (&#147;super-majority provisions&#148;).</FONT><BR><br>
</td>
</tr>
<tr>
  <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" width="3%"><FONT face="serif">2.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To require that an arbitrary fair price be offered to all shareholders that is derived from a fixed formula (&#147;fair price amendments&#148;).</FONT><BR><br>
</td>
</tr>
<tr>
  <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" width="3%"><FONT face="serif">3.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To authorize a new class of common stock or preferred stock which may have more votes per share than the existing common stock.</FONT><BR></td>
</tr>
<tr>
  <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" width="3%"><FONT face="serif">4.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To prohibit replacement of existing members of the board of directors.</FONT><BR></td>
</tr>
<tr>
  <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" width="3%"><FONT face="serif">5.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To eliminate shareholder action by written consent without a shareholder meeting.</FONT><BR></td>
</tr>
<tr>
  <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" width="3%"><FONT face="serif">6.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To allow only the board of directors to call a shareholder meeting or to propose amendments to the articles of incorporation.</FONT><br>
<BR></td>
</tr>
<tr>
  <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" width="3%"><FONT face="serif">7.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To implement any other action or procedure designed primarily to discourage a takeover or other similar action (commonly known as a &#147;poison pill&#148;).</FONT><br>
<BR></td>
</tr>
<tr>
  <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" width="3%"><FONT face="serif">8.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To limit the ability of shareholders to nominate directors.</FONT><BR>   </td>
</tr>
</TABLE>
<P>
<FONT face="serif">We will generally vote </FONT><U><FONT face="serif">for</FONT></U><FONT face="serif"> the following shareholder proposals:</FONT>
</P>
<TABLE>
<TR>
  <TD valign="top" width="5%">&nbsp;</TD>
   <TD valign="top" width="5%"><FONT face="serif">1.</FONT><BR>&nbsp;&nbsp;</TD>
   <td valign="top"><FONT face="serif">To rescind share purchases rights or require that they be submitted for shareholder approval, but only if the vote required for approval is not more than 66 2/3%.</FONT><br>
<BR></td>
</tr>
<tr>
  <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" width="3%"><FONT face="serif">2.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To opt out of state anti-takeover laws deemed to be detrimental to the shareholder.</FONT><BR></td>
</tr>
<tr>
  <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" width="3%"><FONT face="serif">3.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To change the state of incorporation for companies operating under the umbrella of anti-shareholder state corporation laws if another state is chosen with favorable laws in this and other areas.</FONT><br>
<BR></td>
</tr>
<tr>
  <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" width="3%"><FONT face="serif">4.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To eliminate any other plan or procedure designed primarily to discourage a takeover or other similar action.</FONT><BR>   </td>
</tr>
</TABLE>
<P align="center">
<FONT face="serif">6</FONT>
</P>

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<A name="page_7"></A>

<TABLE>
<TR>
  <TD valign="top" width="5%">&nbsp;</TD>
   <TD valign="top" width="5%"><FONT face="serif">5.</FONT><BR>&nbsp;&nbsp;</TD>
   <td valign="top"><FONT face="serif">To permit shareholders to participate in formulating management&#146;s proxy and the opportunity to discuss and evaluate management&#146;s director nominees, and/or to nominate shareholder nominees to the
board.</FONT><BR><br>
</td>
</tr>
<tr>
  <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" width="3%"><FONT face="serif">6.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To require that the board&#146;s audit, compensation, and/or nominating committees be comprised exclusively of independent directors.</FONT><br>
<BR></td>
</tr>
<tr>
  <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" width="3%"><FONT face="serif">7.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To adopt anti-greenmail charter or by-law amendments or otherwise restrict a company&#146;s ability to make greenmail payments.</FONT><br>
<BR></td>
</tr>
<tr>
  <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" width="3%"><FONT face="serif">8.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To create a dividend reinvestment program.</FONT><BR></td>
</tr>
<tr>
  <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" width="3%"><FONT face="serif">9.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To recommend that votes to &#147;abstain&#148; not be considered votes &#147;cast&#148; at an annual meeting or special meeting, unless required by state law.</FONT><br>
<BR></td>
</tr>
<tr>
  <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" width="3%"><FONT face="serif">10.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To require that &#147;golden parachutes&#148; be submitted for shareholder ratification.</FONT><BR>   </td>
</tr>
</TABLE>
<P>
<FONT face="serif">We will generally vote </FONT><U><FONT face="serif">against</FONT></U><FONT face="serif"> the following shareholder proposals:</FONT>
</P>
<TABLE width=100%>
<TR>
  <TD valign="top" width="5%">&nbsp;</TD>
   <TD valign="top" width="5%"><FONT face="serif">1.</FONT><BR>&nbsp;&nbsp;</TD>
   <td valign="top"><FONT face="serif">To restore preemptive rights.</FONT><BR></td>
</tr>
<tr>
  <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" width="3%"><FONT face="serif">2.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To restore cumulative voting.</FONT><BR></td>
</tr>
<tr>
  <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" width="3%"><FONT face="serif">3.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To require annual election of directors or to specify tenure.</FONT><BR></td>
</tr>
<tr>
  <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" width="3%"><FONT face="serif">4.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To eliminate a staggered board of directors.</FONT><BR></td>
</tr>
<tr>
  <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" width="3%"><FONT face="serif">5.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To require confidential voting.</FONT><BR></td>
</tr>
<tr>
  <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" width="3%"><FONT face="serif">6.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To require directors to own a minimum amount of company stock in order to qualify as a director or to remain on the board.</FONT><br>
<BR></td>
</tr>
<tr>
  <td valign="top" width="3%">&nbsp;</td>
   <td valign="top" width="3%"><FONT face="serif">7.</FONT><BR>&nbsp;&nbsp;</td>
   <td valign="top"><FONT face="serif">To dock director pay for failing to attend board meetings.</FONT><BR>   </td>
</tr>
</TABLE>
<P align="center">
<FONT face="serif">7</FONT>
</P>

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<A name="page_8"></A>

<P align="center">
<FONT face="serif">SECTION III </FONT>
</P>
<P align="center">
<U><FONT face="serif">VOTING PROCESS</FONT></U><FONT face="serif"> </FONT>
</P>
<P>
<FONT face="serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;BlackRock has engaged a third-party service provider to assist us in the voting of proxies. These guidelines have been provided to this service provider, who then analyzes all proxy solicitations we receive for our clients and
makes recommendations to us as to how, based upon our guidelines, the relevant votes should be cast. These recommendations are set out in a report that is provided to the relevant Portfolio Management Group team, who must approve the proxy vote in
writing and return such written approval to the Operations Group. If any authorized member of a Portfolio Management Group team desires to vote in a manner that differs from the recommendations, the reason for such differing vote shall be noted in
the written approval form. A copy of the written approval form is attached as an exhibit. The head of each relevant Portfolio Management Group team is responsible for making sure that proxies are voted in a timely manner. The Brokerage Allocation
Committee shall receive regular reports of all proxy votes cast to review how proxies have been voted, including reviewing votes that differ from recommendations made by our third-party service provider and votes that may have involved a potential
conflict of interest. The Committee shall also review these guidelines from time to time to determine their continued appropriateness and whether any changes to the guidelines or the proxy voting process should be made. </FONT>
</P>
<P>
<FONT face="serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IF THERE IS ANY POSSIBILITY THAT THE VOTE MAY INVOLVE A MATERIAL CONFLICT OF INTEREST BECAUSE, FOR EXAMPLE, THE ISSUER SOLICITING THE VOTE IS A BLACKROCK CLIENT OR THE MATTER BEING VOTED ON INVOLVES BLACKROCK, PNC OR ANY
AFFILIATE (INCLUDING A PORTFOLIO MANAGEMENT GROUP EMPLOYEE) OF EITHER OF THEM, PRIOR TO APPROVING SUCH VOTE, THE BROKERAGE ALLOCATION COMMITTEE MUST BE CONSULTED AND THE MATTER DISCUSSED. The Committee, in consultation with the Legal and Compliance
Department, shall determine whether the potential conflict is material and if so, the appropriate method to resolve such conflict, based on the particular facts and circumstances, the importance of the proxy issue, whether the Portfolio Management
Group team is proposing a vote that differs from recommendations made by our third-party service provider with respect to the issue and the nature of the conflict, so as to ensure that the voting of the proxy is not affected by the potential
conflict.  If the conflict is determined not to be material, the relevant Portfolio Management Group team shall vote the proxy in accordance with this Policy. Determinations of the Committee with respect to votes involving material conflicts of
interest shall be documented in writing and maintained for a period of at least six years. </FONT>
</P>
<P>
<FONT face="serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;With respect to votes in connection with securities held on a particular record date but sold from a client account prior to the holding of the related meeting, BlackRock may take no action on proposals to be voted on in such
meeting. </FONT>
</P>
<P>
<FONT face="serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;With respect to voting proxies of non-U.S. companies, a number of logistical problems may arise that may have a detrimental effect on BlackRock&#146;s ability to vote such proxies in the best interests of our clients.  These
problems include, but are not limited to, (i) untimely and/or</FONT>
</P>
<P align="center">
<FONT face="serif">8 </FONT>
</P>

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<PAGE>
<A name="page_9"></A>

<P>
<FONT face="serif">inadequate notice of shareholder meetings, (ii) restrictions on the ability of holders outside the issuer's jurisdiction of organization to exercise votes, (iii) requirements to vote proxies in person, if not practicable, (iv) the
imposition of restrictions on the sale of the securities for a period of time in proximity to the shareholder meeting, and (v) impracticable or inappropriate requirements to provide local agents with power of attorney to facilitate the voting
instructions. Accordingly, BlackRock may determine not to vote proxies if it believes that the restrictions or other detriments associated with such vote outweigh the benefits that will be derived by voting on the company's proposal. </FONT>
</P>
<P align="center">
<FONT face="serif"> 	</FONT><B><FONT face="serif">* 	* 	* 	* 	*</FONT></B><FONT face="serif"> </FONT>
</P>
<P>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="serif">Any questions regarding this Policy may be directed to the General Counsel of BlackRock. <br>
<br>
Approved: October 21, 1998 <br>
<br>
Revised: May 27, 2003 </FONT>
</P>
<P align="center">
<FONT face="serif">9</FONT>
</P>

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