Funds

Semi-Annual Report

August 31, 2006

ING Prime Rate Trust

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This report is submitted for general information to shareholders of the ING Funds. It is not authorized for distribution to prospective shareholders unless accompanied or preceded by a prospectus which includes details regarding the funds' investment objectives, risks, charges, expenses and other information. This information should be read carefully.

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ING Prime Rate Trust

SEMI-ANNUAL REPORT

August 31, 2006

Table of Contents

Portfolio Managers' Report					2
Statement of Assets and Liabilities					7
Statement of Operations					8
Statements of Changes in Net Assets					9
Statement of Cash Flows					10
Financial Highlights					11
Notes to Financial Statements					12
Portfolio of Investments					24
Shareholder Meeting Information					59
Additional Information					60

 

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ING Prime Rate Trust

PORTFOLIO MANAGERS' REPORT

Dear Shareholders:

ING Prime Rate Trust (the "Trust") is a diversified, closed-end management investment company that seeks to provide investors with as high a level of current income as is consistent with the preservation of capital. The Trust seeks to achieve this objective by investing, under normal circumstances, at least 80% of its net assets, plus the amount of any borrowings for investment purposes, in U.S. dollar denominated floating rate secured senior loans.

PORTFOLIO CHARACTERISTICS AS OF AUGUST 31, 2006
Net Assets					$1,089,806,330
Total Assets					$2,050,142,824
Assets Invested in Senior Loans					$1,957,495,444
Senior Loans Represented					532
Average Amount Outstanding per Loan					$3,679,503
Industries Represented					38
Average Loan Amount per Industry					$51,513,038
Portfolio Turnover Rate (YTD)					32	%
Weighted Average Days to Interest Rate Reset					41
Average Loan Final Maturity					62 months
Total Leverage as a Percentage of Total Assets (including Preferred Shares)					44.05	%

 

PERFORMANCE SUMMARY

The Trust declared $0.14 of dividends during the second fiscal quarter and $0.28 for the six months ended August 31, 2006. Based on the average month-end net asset value ("NAV") per share of $7.54, this resulted in an annualized distribution rate of 7.03%^₍₁₎ for the quarter and 7.25%^₍₁₎ for the six months. The Trust's total net return for the second fiscal quarter, based on NAV, was 1.57%, versus a total gross return on the S&P/LSTA Leveraged Loan Index ("LLI")^₍₂₎ of 1.48% for the same quarter. For the six months, the Trust's total net return, based on NAV was 2.77% versus 2.79% gross return for the S&P/LSTA Leveraged Loan Index. The total market value return (based on full reinvestment of dividends) for the Trust's common shares during the second fiscal quarter was 2.99% and 5.34% for the six months ended August 31, 2006.

PORTFOLIO OVERVIEW

Although asset-level performance generally continues to be favorable relative to both the Trust's benchmark and its peers, returns for the last six-month period were hampered by two mid-second-quarter events. First, a secondary market price correction disproportionately impacted the better-quality, typically lower coupon sub-set of the market, an area that the Trust has historically emphasized based on its lower credit risk profile. Second, the Trust's performance was hurt by

^₍₁₎  The distribution rate is calculated by annualizing dividends declared during the period and dividing the resulting annualized dividend by the Trust's average month-end net asset value (in the case of NAV) or the average month-end NYSE Composite closing price (in the case of Market). The distribution rate is based solely on the actual dividends and distributions, which are made at the discretion of management. The distribution rate may or may not include all investment income and ordinarily will not include capital gains or losses, if any.

^₍₂₎  The S&P/LSTA Leveraged Loan Index ("LLI") is an unmanaged total return index that captures accrued interest, repayments, and market value changes. It represents a broad cross section of leveraged loans syndicated in the United States, including dollar-denominated loans too verse as issuers. Standard & Poor's and the Loan Syndications and Trading Association ("LSTA")conceived the LLI to establish a performance benchmark for the syndicated leveraged loan industry. An investor cannot invest directly in an index.

^₍₃₎  Source: Standard & Poor's Leveraged Commentary & Data

2

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ING Prime Rate Trust

PORTFOLIO MANAGERS' REPORT (continued)

reduced bid levels for loans of the Adelphia Communications group of affiliates, due to uncertainty surrounding the distribution of the company's escrowed sale proceeds. Fortunately, investor sentiment improved over the course of the summer and the net asset value performance of the Trust picked up nicely near the end of the quarter.

Sector positioning remained relatively stable over the period, which benefited the Trust. Cable and healthcare, the Trust's largest and second largest exposures respectively as of August 31, continue to be two of the best performing sectors in the LLI^₍₂₎ (despite Adelphia's inclusion in the cable sector). The Trust has for the most part avoided those areas of existing or developing weakness, such as auto suppliers and real estate/residential building products.

Credit conditions in the broad market remain steady as evidenced by a stable trailing twelve month default rate LLI^₍₂₎ to 1.36% at period-end, from 2.08% as of our last fiscal year ended February 28, 2006. The Trust's non-performing assets continue to be insignificant relative to total assets under management. The Trust did not and does not hold any of the defaults in the LLI^₍₂₎ that have occurred since the beginning of the year.

USE OF LEVERAGE

The Trust utilizes financial leverage to seek to increase the yield to the holders of common shares. As of August 31, 2006, the Trust had $450 million of

TOP TEN INDUSTRY SECTORS AS OF AUGUST 31, 2006 AS A PERCENTAGE OF:
				TOTAL ASSETS				NET ASSETS
North American Cable					11.1	%			20.8	%
Healthcare, Education and Childcare					7.8	%			14.6	%
Chemicals, Plastics & Rubber					5.7	%			10.8	%
Oil & Gas					4.8	%			9.0	%
Printing & Publishing					4.6	%			8.7	%
Leisure, Amusement, Entertainment					4.5	%			8.5	%
Utilities					4.2	%			7.9	%
Buildings & Real Estate					4.2	%			7.9	%
Automobile					4.0	%			7.4	%
Retail Stores					3.5	%			6.5	%

 

Portfolio holdings are subject to change daily.

TOP TEN SENIOR LOAN ISSUERS AS OF AUGUST 31, 2006 AS A PERCENTAGE OF:
				TOTAL ASSETS				NET ASSETS
Charter Communications Operating, LLC					2.6	%			4.9	%
Metro-Goldwyn-Mayer Studios, Inc.					2.0	%			3.8	%
Georgia-Pacific Corporation					1.7	%			3.3	%
NRG Energy, Inc.					1.5	%			2.8	%
Century Cable Holdings, LLC					1.5	%			2.7	%
Sunguard Data Systems					1.4	%			2.7	%
Olympus Cable Holdings, LLC					1.3	%			2.5	%
Fidelity National Information Solutions, Inc.					1.2	%			2.3	%
CSC Holdings, Inc.					1.2	%			2.2	%
Cequel Communications, LLC					1.0	%			2.0	%

 

Portfolio holdings are subject to change daily.

^₍₂₎  The S&P/LSTA Leveraged Loan Index ("LLI") is an unmanaged total return index that captures accrued interest, repayments, and market value changes. It represents a broad cross section of leveraged loans syndicated in the United States, including dollar-denominated loans too verse as issuers. Standard & Poor's and the Loan Syndications and Trading Association ("LSTA")conceived the LLI to establish a performance benchmark for the syndicated leveraged loan industry. An investor cannot invest directly in an index.

^₍₃₎  Source: Standard & Poor's Leveraged Commentary & Data

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ING Prime Rate Trust

PORTFOLIO MANAGERS' REPORT (continued)

"Aaa/AAA^₍₄₎" rated cumulative auction rate preferred shares outstanding, and $453 million of borrowings outstanding under $625 million in available credit facilities. Total leverage, as a percentage of total assets (including preferred shares), was 44.05% at period end. The use of leverage for investment purposes increases both investment opportunity and investment risk.

CURRENT STRATEGY AND OUTLOOK

Despite uncertainty surrounding upcoming Fed actions, we believe the near-term prognosis for the loan market remains favorable. While new issue spreads have tightened a bit recently (coincident with robust demand), we expect that trend to quietly stall out due to a record visible new issue pipeline anchored by several multi-billion dollar transactions. Our strategy is focused on delivering attractive risk-adjusted returns and moderate net asset value volatility. The combination of stable credit conditions, healthy demand (driven largely by collateralized loan obligation issuance) and a constant flow of new transactions coming to market should provide a positive environment for non-investment grade loan performance through the balance of 2006.

Jeffrey A. Bakalar Senior Vice President Senior Portfolio Manager ING Investment Management Co.				Daniel A. Norman Senior Vice President Senior Portfolio Manager ING Investment Management Co.

 

ING Prime Rate Trust
October 24, 2006

^₍₄₎  Obligations rated Aaa by Moody's Investors Service are judged to be of the highest quality, with minimal credit risk. An obligator rated 'AAA' has extremely strong capacity to meet its financial commitments. 'AAA' is the highest Issuer Credit Rating assigned by Standard & Poor's. Credit quality refers to the Trust's underlying investments, not to the stability or safety of this Trust.

4

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ING Prime Rate Trust

PORTFOLIO MANAGERS' REPORT (continued)

				Average Annual Total Returns for the Years Ended August 31, 2006
				1 Year				3 Years				5 Years				10 Years
Based on Net Asset Value (NAV)					8.14	%			8.94	%			6.37	%			5.65	%
Based on Market Value					9.41	%			4.73	%			5.63	%			4.73	%
S&P/LSTA Leveraged Loan Index(a)					5.89	%			5.93	%			5.11	%			—
Credit-Suisse Leveraged Loan Index					6.36	%			6.45	%			5.37	%			5.56	%

 

The table above illustrates the total return of the Trust against the Indices indicated. An Index has no cash in its portfolio, imposes no sales charges and incurs no operating expenses. An investor cannot invest directly in an index.

Total returns based on NAV reflect that ING Investments, LLC (the Trust's Investment Adviser") may have waived or recouped fees and expenses otherwise payable by the Trust.

Performance data represents past performance and is no guarantee of future results. Investment return and principal value of an investment in the Trust will fluctuate. Shares, when sold, may be worth more or less than their original cost. The Trust's future performance may be lower or higher than the performance data shown. Please log on to www.ingfunds.com or call (800) 992-0180 to get performance through the most recent month end.

Assumes rights were exercised and excludes sales charges and commissions^_(b),(c)

  (a)  Performance since inception for the index is 5.36% from January 1, 1997.

  (b)  Calculation of total return assumes a hypothetical initial investment at the net asset value (in the case of NAV) or the NYSE Composite closing price (in the case of Market Value) on the last business day before the first day of the stated period, with all dividends and distributions reinvested at the actual reinvestment price.

  (c)  On October 18, 1996, the Trust issued to its shareholders non-transferable rights which entitled the holders to subscribe for 18,122,963 shares of the Trust's common stock at the rate of one share of common stock for each five rights held. On November 12, 1996, the offering expired and was fully subscribed. The Trust issued 18,122,963 shares of its common stock to exercising rights holders at a subscription price of $9.09. Offering costs of $6,972,203 were charged against the offering proceeds.

Senior loans are subject to credit risks and the potential for non-payment of scheduled principal or interest payments, which may result in a reduction of the Trust's NAV.

This report contains statements that may be "forward-looking" statements. Actual results could differ materially from those projected in the "forward-looking" statements.

The views expressed in this report reflect those of the portfolio managers only through the end of the period of the report as stated on the cover. The portfolio managers' views are subject to change at any time based on market and other conditions.

INDEX DESCRIPTIONS

The S&P/LSTA Leveraged Loan Index ("LLI") is an unmanaged total return index that captures accrued interest, repayments, and market value changes. It represents a broad cross section of leveraged loans syndicated in the United States, including dollar-denominated loans to overseas issuers. Standard & Poor's and the Loan Syndications & Trading Association ("LSTA") conceived the LLI to establish a performance benchmark for the syndicated leveraged loan industry. An investor cannot invest directly in an index.

The Credit-Suisse Leveraged Loan Index is an unmanaged index of below investment grade loans designed to mirror the investable universe of the U.S. dollar-denominated leveraged loan market. An investor cannot invest directly in an index.

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ING Prime Rate Trust

PORTFOLIO MANAGERS' REPORT (continued)

YIELDS AND DISTRIBUTIONS RATES

Quarter Ended				Prime Rate				Net Asset Value ("NAV") 30-Day SEC Yield(A)				Market 30-Day SEC Yield(A)				Average Annualized Distribution Rate at NAV(B)				Average Annualized Distribution Rate at Market(B)
August 31, 2006					8.25	%			9.42	%			9.95	%			7.47	%			7.86	%
May 31, 2006					8.00	%			9.63	%			10.31	%			7.10	%			7.57	%
February 28, 2006					7.50	%			8.40	%			9.10	%			6.59	%			7.25	%
November 30, 2005					7.00	%			8.09	%			9.17	%			6.25	%			6.97	%

 

^_(A)  Yield is calculated by dividing the Trust's net investment income per share for the most recent thirty days by the net asset value (in the case of NAV) or the NYSE Composite closing price (in the case of market) at quarter-end. Yield calculations do not include any commissions or sales charges, and are compounded for six months and annualized for a twelve-month period to derive the Trust's yield consistent with the U.S. Securities and Exchange Commission ("SEC") standardized yield formula.

^_(B)  The distribution rate is calculated by annualizing each monthly dividend, then averaging the annualized dividends declared for each month during the quarter and dividing the resulting average annualized dividend amount by the Trust's average net asset value (in the case of NAV) or the NYSE Composite closing price (in the case of Market) at the end of the period.

Risk is inherent in all investing. The following are the principal risks associated with investing in the Trust. This is not, and is not intended to be, a description of all risks of investing in the Trust. A more detailed description of the risks of investing in the Trust is contained in the Trust's current prospectus.

Credit Risk: The Trust invests a substantial portion of its assets in below investment grade senior loans and other below investment grade assets. Below investment grade loans involve a greater risk that borrowers may not make timely payment of the interest and principal due on their loans. They also involve a greater risk that the value of such loans could decline significantly. If borrowers do not make timely payments of the interest due on their loans, the yield on the Trust will decrease. If borrowers do not make timely payment of the principal due on their loans, or if the value of such loans decreases, the value of the Trust's NAV will decrease.

Interest Rate Risk: Changes in short-term market interest rates will directly affect the yield on the Trust. If short-term market interest rates fall, the yield on the Trust will also fall. To the extent that the interest rate spreads on loans in the Trust experience a general decline, the yield on the Trust will fall and the value of the Trust's assets may decrease, which will cause the Trust's value to decrease. Conversely, when short-term market interest rates rise, because of the lag between changes in such short-term rates and the resetting of the floating rates on assets in the Trust, the impact of rising rates will be delayed to the extent of such lag.

Leverage Risk: The Trust borrows money for investment purposes. Borrowing increases both investment opportunity and investment risk. In the event of a general market decline in the value of assets such as those in which the Trust invests, the effect of that decline will be magnified in the Trust because of the additional assets purchased with the proceeds of the borrowings.

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ING Prime Rate Trust

STATEMENT OF ASSETS AND LIABILITIES as of August 31, 2006 (Unaudited)

ASSETS:
Investments in securities at value (Cost $1,966,426,720)				$	1,981,269,532
Cash					1,514,901
Foreign currencies at value (Cost $15,038,356)					15,359,471
Receivables:
Investment securities sold					32,271,136
Interest					19,584,157
Other					58,208
Prepaid expenses					85,419
Total assets					2,050,142,824
LIABILITIES:
Notes payable					453,000,000
Payable for investments purchased					51,246,920
Accrued interest payable					2,347,176
Deferred arrangement fees on senior loans					572,436
Dividends payable - preferred shares					214,569
Payable to affiliates					1,788,534
Payable to custodian					246,223
Accrued trustees' fees					20,179
Unrealized depreciation on foreign currency contracts					354,639
Other accrued expenses					545,818
Total liabilities					510,336,494
Preferred shares, $25,000 stated value per share at liquidation value (18,000 shares outstanding)					450,000,000
NET ASSETS				$	1,089,806,330
Net assets value per common share outstanding (net assets less preferred shares at liquidation value, divided by 145,033,235 shares of   beneficial interest authorized and outstanding, no par value)				$	7.51
NET ASSETS CONSIST OF:
Paid-in capital				$	1,331,413,656
Undistributed net investment income					6,153,018
Accumulated net realized loss on investments					(262,528,950	)
Net unrealized appreciation on investments and foreign currency related transactions					14,768,606
NET ASSETS				$	1,089,806,330

 

See Accompanying Notes to Financial Statements

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ING Prime Rate Trust

STATEMENT OF OPERATIONS for the Six Months Ended August 31, 2006 (Unaudited)

INVESTMENT INCOME:
Interest				$	76,634,771
Arrangement fees earned					539,659
Other					974,785
Total investment income					78,149,215
EXPENSES:
Investment management fees					8,329,226
Administration fees					2,602,883
Transfer agent fees					63,528
Interest expense					14,655,782
Shareholder reporting expense					77,890
Custody and accounting expense					478,100
Professional fees					152,000
Preferred Shares — Dividend disbursing agent fees					614,191
Pricing expense					28,932
ICI fees					1,619
Postage expense					84,080
Trustees fees					36,984
Miscellaneous expense					124,565
Total expenses					27,249,780
Net investment income					50,899,435
REALIZED AND UNREALIZED GAIN (LOSS) FROM INVESTMENTS AND FOREIGN CURRENCY RELATED TRANSACTIONS:
Net realized gain (loss) on:
Investments					13,487,422
Foreign currency related transactions					(215,604	)
Net realized gain on investments and foreign currency related transactions					13,271,818
Net change in unrealized appreciation or depreciation on:
Investments					(25,152,880	)
Foreign currency related transactions					(74,206	)
Net change in unrealized appreciation or depreciation on investments and foreign currency related transactions					(25,227,086	)
Net realized and unrealized loss on investments and foreign currency related transactions					(11,955,268	)
DISTRIBUTIONS TO PREFERRED SHAREHOLDERS:
From net investment income					(10,922,342	)
Net increase in net assets resulting from operations				$	28,021,825

 

See Accompanying Notes to Financial Statements

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ING Prime Rate Trust

STATEMENTS OF CHANGES IN NET ASSETS (Unaudited)

				Six Months Ended August 31, 2006				Year Ended February 28, 2006
FROM OPERATIONS:
Net investment income				$	50,899,435			$	83,109,460
Net realized gain on investments and foreign currency related transactions					13,271,818				422,159
Net change in unrealized appreciation or depreciation on investments and foreign   currency related transactions					(25,227,086	)			16,658,806
Distributions to preferred shareholders from net investment income					(10,922,342	)			(15,839,470	)
Net increase in net assets resulting from operations					28,021,825				84,350,955
FROM DISTRIBUTIONS TO COMMON SHAREHOLDERS:
Distributions from net investment income					(38,886,769	)			(66,428,156	)
Decrease in net assets from distributions to common shareholders					(38,886,769	)			(66,428,156	)
Net increase (decrease) in net assets					(10,864,944	)			17,922,799
NET ASSETS:
Beginning of period					1,100,671,274				1,082,748,475
End of period (including undistributed net investment income of $6,153,018 and $5,062,694, respectively)				$	1,089,806,330			$	1,100,671,274

 

See Accompanying Notes to Financial Statements

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ING Prime Rate Trust

STATEMENT OF CASH FLOWS for the Six Months Ended August 31, 2006 (Unaudited)

INCREASE (DECREASE) IN CASH Cash Flows From Operating Activities:
Interest received				$	72,552,367
Facility fees paid					5,601
Dividend paid to preferred shareholder					(10,935,755	)
Arrangement fee received					199,924
Other income received					910,450
Interest paid					(14,295,658	)
Other operating expenses paid					(12,499,830	)
Purchases of securities					(703,201,477	)
Proceeds from sales of securities					715,370,763
Net cash provided by operating activities				$	48,106,385
Cash Flows From Financing Activities:
Dividends paid to common shareholders				$	(38,886,769	)
Net paydown of notes payable					(12,000,000	)
Net cash flows used in financing activities					(50,886,769	)
Net decrease					(2,780,384	)
Cash at beginning of period					4,295,285
Cash at end of period				$	1,514,901
Reconciliation Of Net Increase In Net Assets Resulting From Operations To Net Cash Provided By Operating Activities:
Net increase in net assets resulting from operations				$	28,021,825
Adjustments to reconcile net increase in net assets resulting from operations to net cash provided by operating activities:
Change in unrealized appreciation or depreciation on investments					25,152,880
Change in unrealized appreciation or depreciation on foreign currencies					(321,115	)
Change in unrealized depreciation on forward currency contracts					354,639
Net accretion of discounts on securities					(477,270	)
Realized gain on investments and foreign currency related transactions					(13,271,818	)
Purchase of securities					(703,201,477	)
Proceeds on sale of securities					715,370,763
Increase in other assets					(23,653	)
Increase in interest receivable					(3,605,134	)
Decrease in prepaid arrangement fees on notes payable					5,601
Decrease in deferred arrangement fees on senior loans					(339,735	)
Increase in accrued interest payable					360,124
Decrease in dividends payable — preferred shares					(13,413	)
Increase in payable to affiliates					122,171
Increase in accrued trustees fees					3,948
Decrease in other accrued expenses					(31,951	)
Total adjustments					20,084,560
Net cash provided by operating activities				$	48,106,385

 

See Accompanying Notes to Financial Statements

10

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ING PRIME RATE TRUST (UNAUDITED)  FINANCIAL HIGHLIGHTS

For a common share outstanding throughout the period

				Six Months Ended August 31,				Years Ended February 28 or February 29,
				2006				2006				2005				2004				2003
Per Share Operating Performance
Net asset value, beginning of period				$	7.59				7.47				7.34				6.73				7.20
Income (loss) from investment operations:
Net investment income				$	0.34				0.57				0.45				0.46				0.50
Net realized and unrealized gain (loss) on investments				$	(0.06	)			0.12				0.16				0.61				(0.47	)
Total from investment operations				$	0.28				0.69				0.61				1.07				0.03
Distributions to Common Shareholders from net investment income				$	(0.28	)			(0.46	)			(0.43	)			(0.42	)			(0.45	)
Distribution to Preferred Shareholders				$	(0.08	)			(0.11	)			(0.05	)			(0.04	)			(0.05	)
Net asset value, end of period				$	7.51				7.59				7.47				7.34				6.73
Closing market price at end of period				$	7.12				7.02				7.56				7.84				6.46
Total Investment Return(1)
Total investment return at closing market price(2)				%	5.34				(0.82	)			2.04				28.77				2.53
Total investment return at net asset value(3)				%	2.77				8.53				7.70				15.72				0.44
Ratios/Supplemental Data
Net assets end of period (000's)				$	1,089,806				1,100,671				1,082,748				1,010,325				922,383
Preferred Shares-Aggregate amount outstanding (000's)				$	450,000				450,000				450,000				450,000				450,000
Liquidation and market value per share of Preferred Shares				$	25,000				25,000				25,000				25,000				25,000
Borrowings at end of year (000's)				$	453,000				465,000				496,000				225,000				167,000
Asset coverage per $1,000 of debt(4)				$	2,210				2,203				2,140				2,500				2,500
Average borrowings (000's)				$	522,321				509,178				414,889				143,194				190,671
Ratios to average net assets including Preferred Shares(5)
Expenses (before interest and other fees related to revolving credit facility)(6)				%	1.63				1.64				1.60				1.45				1.49
Net expenses after expense reimbursement(6)				%	3.51				3.02				2.21				1.65				1.81
Gross expenses prior to expense reimbursement(6)				%	3.51				3.02				2.22				1.65				1.81
Net investment income(6)				%	6.55				5.44				4.21				4.57				4.97
Ratios to average net assets plus borrowings
Expenses (before interest and other fees related to revolving credit facility)(6)				%	1.55				1.58				1.63				1.84				1.82
Net expenses after expense reimbursement(6)				%	3.35				2.90				2.26				2.09				2.23
Gross expenses prior to expense reimbursement(6)				%	3.35				2.90				2.27				2.09				2.23
Net investment income(6)				%	6.25				5.24				4.32				5.82				6.10
Ratios to average net assets
Expenses (before interest and other fees related to revolving credit facility)(6)				%	2.28				2.33				2.29				2.11				2.19
Net expenses after expense reimbursement(6)				%	4.94				4.27				3.17				2.40				2.68
Gross expenses prior to expense reimbursement(6)				%	4.94				4.27				3.18				2.40				2.68
Net investment income(6)				%	9.24				7.71				6.04				6.68				7.33
Portfolio turnover rate				%	32				81				93				87				48
Common shares outstanding at end of period (000's)					145,033				145,033				145,033				137,638				136,973

 

^₍₁₎  Total investment return calculations are attributable to common shares.

^₍₂₎  Total investment return measures the change in the market value of your investment assuming reinvestment of dividends and capital gain distributions, if any, in accordance with the provisions of the Trust's dividend reinvestment plan.

^₍₃₎  Total investment return at net asset value has been calculated assuming a purchase at net asset value at the beginning of each period and a sale at net asset value at the end of each period and assumes reinvestment of dividends and capital gain distributions in accordance with the provisions of the dividend reinvestment plan.

This calculation differs from total investment return because it excludes the effects of changes in the market values of the Trust's shares.

^₍₄₎  Asset coverage represents the total assets available for settlement of Preferred Stockholder's interest and notes payables in relation to the Preferred Shareholder interest and notes payable balance outstanding. The Preferred Shares were first offered November 2, 2000.

^₍₅₎  Ratios do not reflect the effect of dividend payments to Preferred Shareholders; income ratios reflect income earned on assets attributable to the Preferred Shares; ratios do not reflect any add-back for the borrowings.

^₍₆₎  Annualized for periods less than one year.

See Accompanying Notes to Financial Statements

11

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ING Prime Rate Trust

NOTES TO FINANCIAL STATEMENTS as of August 31, 2006 (Unaudited)

NOTE 1 — ORGANIZATION

ING Prime Rate Trust (the "Trust"), a Massachusetts business trust, is registered under the Investment Company Act of 1940, as amended (the "1940 Act"), as a diversified, closed-end, management investment company. The Trust invests primarily in senior loans, which generally are not registered under the Securities Act of 1933, as amended (the "1933 Act"), and which contain certain restrictions on resale and cannot be sold publicly. These loans bear interest (unless otherwise noted) at rates that float periodically at a margin above the London Inter-Bank Offered Rate ("LIBOR") and other short-term rates.

NOTE 2 — SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of the significant accounting policies consistently followed by the Trust in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America for investment companies.

A.  Senior Loan and Other Security Valuation. Senior loans held by the Trust are normally valued at the mean of the means of one or more bid and ask quotations obtained from an independent pricing service or other sources determined by the Trust's Board of Trustees ("Board") to be independent and believed to be reliable. Loans for which reliable market value quotations are not readily available may be valued with reference to another loan or a group of loans for which reliable quotations are readily available and whose characteristics are comparable to the loan being valued. Under this approach, the comparable loan or loans serve as a proxy for changes in value of the loan being valued.

The Trust has engaged an independent pricing service to provide market value quotations from dealers in loans and, when such quotations are not readily available, to calculate values under the proxy procedure described above. As of August 31, 2006, 98.56% of total investments were valued based on these procedures. It is expected that most of the loans held by the Trust will continue to be valued with reference to quotations from the independent pricing service or with reference to the proxy procedure described above.

Prices from a pricing source may not be available for all loans and ING Investments, LLC (the "Investment Adviser") or ING Investment Management Co. ("ING IM" or the "Sub-Adviser"), may believe that the price for a loan derived from market quotations or the proxy procedure described above is not reliable or accurate. Among other reasons, this may be the result of information about a particular loan or borrower known to the Investment Adviser or the Sub-Adviser that the Investment Adviser or the Sub-Adviser believes may not be known to the pricing service or reflected in a price quote. In this event, the loan is valued at fair value as determined in good faith under procedures established by the Board and in accordance with the provisions of the 1940 Act. Under these procedures, fair value is determined by the Investment Adviser or Sub-Adviser and monitored by the Board through its Valuation, Brokerage and Proxy Committee.

In fair valuing a loan, consideration is given to several factors, which may include, among others, the following: (i) the characteristics of and fundamental analytical data relating to the loan, including the cost, size, current interest rate, period until the next interest rate reset, maturity and base lending rate of the loan, the terms and conditions of the loan and any related agreements, and the position of the loan in the borrower's debt structure; (ii) the nature, adequacy and value of the collateral, including the Trust's rights, remedies and interests with respect to the collateral; (iii) the creditworthiness of the borrower and the cash flow coverage of outstanding principal and interest, based on an evaluation of its financial condition, financial statements and information about the borrower's business, cash flows, capital structure and future prospects; (iv) information relating to the market for the loan,

12

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ING Prime Rate Trust

NOTES TO FINANCIAL STATEMENTS as of August 31, 2006 (Unaudited) (continued)

NOTE 2 — SIGNIFICANT ACCOUNTING POLICIES (continued)

including price quotations for, and trading in, the loan and interests in similar loans; (v) the reputation and financial condition of the agent for the loan and any intermediate participants in the loan; (vi) the borrower's management; and (vii) the general economic and market conditions affecting the fair value of the loan. Securities for which the primary market is a national securities exchange are valued at the last reported sale price. Securities reported by NASDAQ will be valued at the NASDAQ Official Closing Price. Securities traded in the over-the-counter market and listed securities for which no sale was reported on a valuation date are valued at the mean between the last reported bid and ask price on such exchange. Securities, other than senior loans, for which reliable market value quotations are not readily available, and all other assets, will be valued at their respective fair values as determined in good faith by, and under procedures established by, the Board. Investments in securities maturing in 60 days or less from the date of valuation are valued at amortized cost, which, when combined with accrued interest approximates market value.

B.  Federal Income Taxes. It is the Trust's policy to comply with subchapter M of the Internal Revenue Code and related excise tax provisions applicable to regulated investment companies and to distribute substantially all of its net investment income and net realized capital gains to its shareholders. Therefore, no federal income tax provision is required. No capital gain distributions will be made by the Trust until any capital loss carryforwards have been fully utilized or expire.

C.  Security Transactions and Revenue Recognition. Revolver and delayed draw loans are booked on a settlement date basis. Security transactions and senior loans are accounted for on trade date (date the order to buy or sell is executed). Realized gains or losses are reported on the basis of identified cost of securities sold. Dividend income is recognized on the ex-dividend date. Interest income is recorded on an accrual basis at the then-current interest rate of the loan. The accrual of interest on loans is discontinued when, in the opinion of management, there is an indication that the borrower may be unable to meet payments as they become due. Upon such discontinuance, all unpaid accrued interest is reversed. Cash collections on non-accrual senior loans are generally applied as a reduction to the recorded investment of the loan. Senior loans are generally returned to accrual status only after all past due amounts have been received. For all loans, except revolving credit facilities, fees received are treated as discounts and are accreted whereas premiums are amortized. Fees associated with revolving credit facilities are deferred and recognized over the shorter of four years or the actual term of the loan.

D.  Foreign Currency Translation. The books and records of the Trust are maintained in U.S. dollars. Any foreign currency amounts are translated into U.S. dollars on the following basis:

(1)  Market value of investment securities, other assets and liabilities — at the exchange rates prevailing at the end of the day.

(2)  Purchases and sales of investment securities, income and expenses — at the rates of exchange prevailing on the respective dates of such transactions.

Although the net assets and the market values are presented at the foreign exchange rates at the end of the day, the Trust does not isolate the portion of the results of operations resulting from changes in foreign exchange rates on investments from the fluctuations arising from changes in market prices of securities held. Such fluctuations are included with the net realized and unrealized gains or losses from investments. For securities, which are subject to foreign withholding tax upon disposition, liabilities are recorded on the Statement of Assets and Liabilities for the estimated tax withholding based on the securities current market value. Upon disposition, realized gains or losses on such securities are recorded net of foreign withholding tax.

13

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ING Prime Rate Trust

NOTES TO FINANCIAL STATEMENTS as of August 31, 2006 (Unaudited) (continued)

NOTE 2 — SIGNIFICANT ACCOUNTING POLICIES (continued)

Reported net realized foreign exchange gains or losses arise from sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions, the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Trust's books, and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes in the value of assets and liabilities other than investments in securities at fiscal year end, resulting from changes in the exchange rate. Foreign security and currency transactions may involve certain considerations and risks not typically associated with investing in U.S. companies and the U.S. government. These risks include, but are not limited to, revaluation of currencies and future adverse political and economic developments which could cause securities and their markets to be less liquid and prices more volatile than those of comparable U.S. companies and U.S. government securities.

E.  Forward Foreign Currency Contracts. The Trust may enter into forward foreign currency contracts primarily to hedge against foreign currency exchange rate risks on its non-U.S. dollar denominated investment securities. When entering into a currency forward contract, the Trust agrees to receive or deliver a fixed quantity of foreign currency for an agreed-upon price on an agreed future date. These contracts are valued daily and the Trust's net equity therein, representing unrealized gain or loss on the contracts as measured by the difference between the forward foreign exchange rates at the dates of entry into the contracts and the forward rates at the reporting date, is included in the Statement of Assets and Liabilities. Realized and unrealized gains and losses are included in the Statement of Operations. These instruments involve market and/or credit risk in excess of the amount recognized in the Statement of Assets and Liabilities. Risks arise from the possible inability of counterparties to meet the terms of their contracts and from movement in currency and securities values and interest rates. Open forward foreign currency contracts are presented following the respective Portfolio of Investments.

F.  Distributions to Common Shareholders. The Trust declares and pays dividends monthly from net investment income. Distributions from capital gains, if any, are declared and paid annually. The Trust may make additional distributions to comply with the distribution requirements of the Internal Revenue Code. The character and amounts of income and gains to be distributed are determined in accordance with federal income tax regulations, which may differ from U.S. generally accepted accounting principles for investment companies. The Trust records distributions to its shareholders on the ex-dividend date.

G.  Dividend Reinvestments. Pursuant to the Trust's Shareholder Investment Program (the "Program"), DST Systems, Inc. ("DST"), the Program administrator, purchases, from time to time, shares of beneficial interest of the Trust on the open market to satisfy dividend reinvestments. Such shares are purchased on the open market only when the closing sale or bid price plus commission is less than the NAV per share of the Trust's common shares on the valuation date. If the market price plus commissions is equal to or exceeds NAV, new shares are issued by the Trust at the greater of (i) NAV or (ii) the market price of the shares during the pricing period, minus a discount of 5%.

H.  Use of Estimates. Management of the Trust has made certain estimates and assumptions relating to the reporting of assets, liabilities, revenues, expenses and contingencies to prepare these financial statements in conformity with generally accepted accounting principles in the United States of America for investment companies. Actual results could differ from these estimates.

14

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ING Prime Rate Trust

NOTES TO FINANCIAL STATEMENTS as of August 31, 2006 (Unaudited) (continued)

NOTE 2 — SIGNIFICANT ACCOUNTING POLICIES (continued)

I.  Share Offerings. The Trust issues shares under various shelf registration statements, whereby the net proceeds received by the Trust from share sales may not be less than the greater of (i) the NAV per share or (ii) 94% of the average daily market price over the relevant pricing period.

NOTE 3 — INVESTMENTS

For the six months ended August 31, 2006, the cost of purchases and the proceeds from principal repayment and sales of investments, excluding short-term notes, totaled $665,627,076 and $740,547,363 respectively. At August 31, 2006, the Trust held senior loans valued at $1,957,495,444 representing 98.8% of its total investments. The market value of these assets is established as set forth in Note 2.

The senior loans acquired by the Trust typically take the form of a direct lending relationship with the borrower, and are typically acquired through an assignment of another lender's interest in a loan. The lead lender in a typical corporate loan syndicate administers the loan and monitors the collateral securing the loan.

Common and preferred shares, and stock purchase warrants held in the portfolio were acquired in conjunction with loans held by the Trust. Certain of these stocks and warrants are restricted and may not be publicly sold without registration under the 1933 Act, or without an exemption under the 1933 Act. In some cases, these restrictions expire after a designated period of time after issuance of the shares or warrants.

15

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ING Prime Rate Trust

NOTES TO FINANCIAL STATEMENTS as of August 31, 2006 (Unaudited) (continued)

NOTE 3 — INVESTMENTS (continued)

Dates of acquisition and cost of assigned basis of restricted securities are as follows:

				Date of Acquisition				Cost or Assigned Basis
Allied Digital Technologies Corporation (Residual Interest in Bankruptcy Estate)				06/05/02				$	107,510
AM Cosmetics Corporation (Liquidation Interest)				03/07/03					25
Block Vision Holdings Corporation (571 Common Shares)				09/17/02					—
Boston Chicken, Inc. (Residual Interest in Boston Chicken Plan Trust)				12/26/00					9,993
Cedar Chemical (Liquidation Interest)				12/31/02					—
Covenant Care, Inc. (Warrants for 19,000 Common Shares, Expires January 13, 2005)				12/22/95					0
Covenant Care, Inc. (Warrants for 26,901 Common Shares, Expires March 31, 2013)				01/18/02					—
Decision One Corporation (1,402,038 Common Shares)				05/17/05					1,116,773
Electro Mechanical Solutions (Residual Interest in Bankruptcy Estate)				10/02/02					15
Enterprise Profit Solutions (Liquidation Interest)				10/21/02					—
EquityCo, LLC (Warrants for 28,782 Common Shares)				02/25/05					—
Euro United Corporation (Residual Interest in Bankruptcy Estate)				06/21/02					305,999
Gemini Leasing, Inc. (143,079 common shares)				01/08/04					—
Grand Union Company (Residual Interest in Bankruptcy Estate)				07/01/02					2,576
Humphreys, Inc. (Residual Interest in Bankruptcy Estate)				05/15/02					50
Imperial Home Décor Group, Inc. (Liquidation Interest)				01/22/04					—
Insilco Technologies (Residual Interest in Bankruptcy Estate)				05/02/03					1
IT Group, Inc. (Residual Interest in Bankruptcy Estate)				09/12/03					100
Kevco, Inc. (Residual Interest in Bankruptcy Estate)				06/05/02					50
Lincoln Paper & Tissue (Warrants for 291 Common Shares, Expires August 24, 2015)				08/25/05					—
Lincoln Pulp and Eastern Fine (Residual Interest in Bankruptcy Estate)				06/08/04					—
London Clubs International (Warrants for 241,499 Common Shares, Expires February 27, 2011)				12/08/04					—
Neoplan USA Corporation (17,348 Common Shares)				08/29/03					—
Neoplan USA Corporation (1,084,000 Series C Preferred Shares)				08/29/03					428,603
Neoplan USA Corporation (1,814,180 Series B Preferred Shares)				08/29/03					—
Neoplan USA Corporation (3,524,300 Series D Preferred Shares)				08/29/03					3,524,300
New Piper Aircraft, Inc. (Residual Interest in Litigation Proceeds)				07/02/03					—
New World Restaurant Group, Inc. (10,205 Common Shares)				06/26/06					10,459
Norwood Promotional Products, Inc. (72,238 Common Shares)				08/23/04					32,939
Safelite Glass Corporation (810,050 Common Shares)				10/12/00					173,588
Safelite Realty Corporation (54,679 Common Shares)				10/12/00					—
Transtar Metals (Residual Interest in Bankruptcy Estate)				01/09/03					40,230
TSR Wireless, LLC (Residual Interest in Bankruptcy Estate)				10/15/02					—
U.S. Office Products Company (Residual Interest in Bankruptcy Estate)				02/11/04					—
U.S. Aggregates (Residual Interest in Bankruptcy Estate)				04/07/03					—
Total Restricted Securities excluding senior loans (market value of $17,689,443 was 1.6% of net assets at August 31, 2006)								$	5,753,211

 

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ING Prime Rate Trust

NOTES TO FINANCIAL STATEMENTS as of August 31, 2006 (Unaudited) (continued)

NOTE 4 — MANAGEMENT AND ADMINISTRATION AGREEMENTS

The Trust has entered into an investment management agreement ("Investment Advisory Agreement") with the Investment Adviser, an Arizona limited liability company, to provide advisory and management services. The Investment Advisory Agreement compensates the Investment Adviser with a fee, computed daily and payable monthly, at an annual rate of 0.80% of the Trust's Managed Assets. For purposes of the Investment Advisory Agreement, "Managed Assets" shall mean the Trust's average daily gross asset value, minus the sum of the Trust's accrued and unpaid dividends on any outstanding preferred shares and accrued liabilities (other than liabilities for the principal amount of any borrowings incurred, commercial paper or notes issued by the Trust and the liquidation preference of any outstanding preferred shares).

The Investment Adviser entered into a sub-Advisory agreement with ING IM, a Connecticut corporation. Subject to such policies as the Board or the Investment Adviser may determine, ING IM manages the Trust's assets in accordance with the Trust's investment objectives, policies, and limitations.

The Trust has also entered into an administration agreement with ING Funds Services, LLC (the "Administrator") to provide administrative services and also to furnish facilities. The Administrator is compensated with a fee, computed daily and payable monthly, at an annual rate of 0.25% of the Trust's Managed Assets.

The Investment Adviser, ING IM and the Administrator are indirect, wholly-owned subsidiaries of ING Groep N.V. ("ING Groep"). ING Groep is one of the largest financial services organizations in the world, and offers an array of banking, insurance and asset management services to both individual and institutional investors.

NOTE 5 — TRANSACTIONS WITH AFFILIATES AND RELATED PARTIES

At August 31, 2006, the Trust had the following amounts recorded in payables to affiliates on the accompanying Statement of Assets and Liabilities:

Accrued Investment Management Fees				Accrued Administrative Fees				Total
$	1,362,693			$	425,841			$	1,788,534

 

The Trust has adopted a Retirement Policy covering all independent trustees of the Trust who will have served as an independent trustee for at least five years at the time of retirement. Benefits under this plan are based on an annual rate as defined in the plan agreement.

NOTE 6 — COMMITMENTS

The Trust has entered into both a $90 million 364-day revolving credit agreement which matured on August 23, 2006 and has been extended to August 22, 2007 and a $535 million 364-day revolving securitization facility which matured on July 9, 2006, and has been extended to June 14, 2007, collateralized by assets of the Trust. Borrowing rates under these agreements are based on a fixed spread over LIBOR, the federal funds rate, or a commercial paper-based rate. Prepaid arrangement fees for these facilities are amortized over the term of the agreements. The amount of borrowings outstanding at August 31, 2006, was $453 million. Weighted average interest rate on outstanding borrowings was 5.74%, excluding fees related to the unused portion of the facilities, and other fees. The amount of borrowings represented 22.1% of total assets at August 31, 2006. Average borrowings for the six months ended August 31, 2006 were $522,320,652 and the average annualized interest rate was 5.57% excluding other fees related to the unused portion of the facilities, and other fees.

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ING Prime Rate Trust

NOTES TO FINANCIAL STATEMENTS as of August 31, 2006 (Unaudited) (continued)

NOTE 6 — COMMITMENTS (continued)

As of August 31, 2006, the Trust had unfunded loan commitments pursuant to the terms of the following loan agreements:

Alon USA, Inc.				$	222,222
Atrium Companies, Inc.					175,059
Babcock & Wilcox Company					2,000,000
Baker & Taylor, Inc.					2,250,000
Baker Tanks, Inc.					510,000
Builders Firstsource, Inc.					1,500,000
Federal-Mogul Corporation					2,730,000
Green Valley Ranch Gaming, Llc					350,000
Hearthstone Housing Partners II, LLC					2,638,235
Interstate Bakeries Corp.					2,500,000
Kerasotes Theatres, Inc.					1,125,000
Lucite International US Finco Limited					1,038,168
MEG Energy Corporation					2,800,000
Neoplan USA Corporation				$	382,500
Norwood Promotional Products Holdings, Inc.					2,287,500
Oglebay Norton Company					400,000
PLY Gem Industries, Inc.					1,250,000
Primedia, Inc.					713,238
Riverstone C/R GS Holdings I					296,970
Syniverse Holding, LLC					1,500,000
Trump Entertainment Resorts Holdings, L.P.					1,732,500
United States Shipping, LLC					838,710
Venetian Macau, Ltd.					1,600,000
Wastequip, Inc.					210,785
				$	31,050,887

 

NOTE 7 — RIGHTS AND OTHER OFFERINGS

As of August 31, 2006, outstanding share offerings pursuant to shelf registrations were as follows:

Registration Date				Shares Registered				Shares Remaining
	9/15/98				25,000,000				12,374,909
	3/04/99				5,000,000				3,241,645

 

On November 2, 2000, the Trust issued 3,600 shares each of Series M, Series W and Series F Auction Rate Cumulative Preferred Shares, $0.01 Par Value, $25,000 liquidation preference, for a total issuance of $270 million. Also, on November 16, 2000, the Trust issued 3,600 shares of Series T and Series Th Auction Rate Cumulative Preferred Shares, $0.01 Par Value, $25,000, liquidation preference, for a total issuance of $180 million. The Trust used the net proceeds of the offering to partially pay down the then existing indebtedness and to purchase additional senior loans. Preferred Shares pay dividends based on a rate set at auctions, normally held every 7 days. In most instances dividends are also payable every 7 days, on the first business day following the end of the rate period. Preferred shares have no stated conversion, redemption or liquidation date, but may be redeemed at the election of the Trust. Such shares may only be redeemed by the Preferred Shareholders if the Trust fails to meet certain credit quality thresholds within its portfolio.

NOTE 8 — CUSTODIAL AGREEMENT

State Street Bank and Trust Company ("SSB") serves as the Trust's custodian and recordkeeper. Custody fees paid to SSB are reduced by earnings credits based on the cash balances held by SSB for the Trust. There were no earnings credits for the six months ended August 31, 2006.

NOTE 9 — SUBORDINATED LOANS AND UNSECURED LOANS

The Trust may invest in subordinated loans and in unsecured loans. The primary risk arising from investing in subordinated loans or in unsecured loans is the potential loss in the event of default by the issuer of the loans. The Trust may acquire a subordinated loan only if, at the time of acquisition, it acquires or holds a senior loan from the same borrower. The Trust will acquire unsecured loans only where the Investment Adviser believes, at the time of acquisition, that the Trust would have the right to payment upon default that is not subordinate to any other creditor. Subject to the aggregate 20% limit on other investments, the Trust may invest up to 20% of its total assets in unsecured floating rate loans, notes and other debt instruments and 5% of its total assets in floating rate subordinated loans. As of August 31, 2006, the Trust held 0.6% of its total assets in subordinated loans and unsecured loans.

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ING Prime Rate Trust

NOTES TO FINANCIAL STATEMENTS as of August 31, 2006 (Unaudited) (continued)

NOTE 10 — FEDERAL INCOME TAXES

The amount of distributions from net investment income and net realized capital gains are determined in accordance with federal income tax regulations, which may differ from U.S. generally accepted accounting principles for investment companies. These book/tax differences may be either temporary or permanent. Permanent differences are reclassified within the capital accounts based on their federal tax-basis treatment; temporary differences are not reclassified. Key differences include the treatment of short-term capital gains, foreign currency transactions, and wash sale deferrals. Distributions in excess of net investment income and/or net realized capital gains for tax purposes are reported as distributions of paid-in capital.

Dividends paid by the Trust from net investment income and distributions of net realized short-term capital gains are, for federal income tax purposes, taxable as ordinary income to shareholders.

The tax composition of dividends and distributions to shareholders was as follows:

Six Months Ended August 31, 2006				Year Ended February 28, 2006
Ordinary Income				Ordinary Income
$	49,809,112			$	82,267,626

 

The tax-basis components of distributable earnings and the expiration dates of the capital loss carryforwards which may be used to offset future realized capital gains for federal income tax purposes as of February 28, 2006 were:

Undistributed Ordinary Income				Unrealized Appreciation/ Depreciation				Post-October Capital Losses Deferred				Capital Loss Carryforwards				Expiration Dates
$	5,290,676			$	39,881,614			$	(1,126,243	)		$	(10,485,033	)			2007
													(38,118,850	)			2008
													(847,193	)			2009
													(47,376,376	)			2010
													(97,064,717	)			2011
													(57,686,392	)			2012
													(22,421,058	)			2013
													(560,828	)			2014
												$	(274,560,447	)

 

NOTE 11 — OTHER ACCOUNTING PRONOUNCEMENTS

In June 2006, the Financial Accounting Standards Board (FASB) issued FASB Interpretation 48 (FIN 48), "Accounting for Uncertainty in Income Taxes." This standard defines the threshold for recognizing the benefits of tax-return positions in the financial statements as "more-likely-than-not" to be sustained by the taxing authority and requires measurement of a tax position meeting the more-likely-than-not criterion, based on the largest benefit that is more than 50 percent likely to be realized. FIN 48 is effective as of the beginning of the first fiscal year beginning after December 15, 2006, with early application permitted if no interim financial statements have been issued. At adoption, companies must adjust their financial statements to reflect only those tax positions that are more likely-than-not to be sustained as of the adoption date.

On September 15, 2006, the FASB issued Statement of Financial Accounting Standard No. 157 ("SFAS No. 157"), Fair Value Measurements. The new accounting statement defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles ("GAAP"), and expands disclosures about fair value measurements. SFAS No. 157 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price). SFAS No. 157 also stipulates that, as a market-based measurement, fair value measurement should be determined

19

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ING Prime Rate Trust

NOTES TO FINANCIAL STATEMENTS as of August 31, 2006 (Unaudited) (continued)

NOTE 11 — OTHER ACCOUNTING PRONOUNCEMENTS (continued)

based on the assumptions that market participants would use in pricing the asset or liability, and establishes a fair value hierarchy that distinguishes between (a) market participant assumptions developed based on market data obtained from sources independent of the reporting entity (observable inputs) and (b) the reporting entity's own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007. As of August 31, 2006, the Trust is currently assessing the impact, if any, that will result from adopting Fin 48 and SFAS No. 157.

NOTE 12 — INFORMATION REGARDING TRADING OF ING'S US MUTUAL FUNDS

In 2004, ING Investments reported to the Boards of Directors/Trustees (the "Boards") of the ING Funds that, like many U.S. financial services companies, ING Investments and certain of its U.S. affiliates had received informal and formal requests for information since September 2003 from various governmental and self-regulatory agencies in connection with investigations related to mutual funds and variable insurance products. ING Investments has advised the Boards that it and its affiliates have cooperated fully with each request.

In addition to responding to regulatory and governmental requests, ING Investments reported that management of U.S. affiliates of ING Groep, including ING Investments (collectively, "ING"), on their own initiative, have conducted, through independent special counsel and a national accounting firm, an extensive internal review of trading in ING insurance, retirement, and mutual fund products. The goal of this review was to identify any instances of inappropriate trading in those products by third parties or by ING investment professionals and other ING personnel. ING's internal review related to mutual fund trading is now substantially completed. ING has reported that, of the millions of customer relationships that ING maintains, the internal review identified several isolated arrangements allowing third parties to engage in frequent trading of mutual funds within ING's variable insurance and mutual fund products, and identified other circumstances where frequent trading occurred, despite measures taken by ING intended to combat market timing. ING further reported that each of these arrangements has been terminated and fully disclosed to regulators. The results of the internal review were also reported to the independent members of the Boards.

ING Investments has advised the Boards that most of the identified arrangements were initiated prior to ING's acquisition of the businesses in question in the U.S. ING Investments further reported that the companies in question did not receive special benefits in return for any of these arrangements, which have all been terminated.

Based on the internal review, ING Investments has advised the Boards that the identified arrangements do not represent a systemic problem in any of the companies that were involved.

In September 2005, ING Funds Distributor, LLC ("IFD"), the distributor of certain ING Funds, settled an administrative proceeding with the NASD regarding three arrangements, dating from 1995, 1996 and 1998, under which the administrator to the then-Pilgrim Funds, which subsequently became part of the ING Funds, entered into formal and informal arrangements that permitted frequent trading. Under the terms of the Letter of Acceptance, Waiver and Consent ("AWC") with the NASD, under which IFD neither admitted nor denied the allegations or findings, IFD consented to the following sanctions: (i) a censure; (ii) a fine of $1.5 million; (iii) restitution of approximately $1.44 million to certain ING Funds for losses attributable to excessive trading described in the AWC; and (iv) agreement to make certification to NASD regarding the review and establishment of certain procedures.

20

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ING Prime Rate Trust

NOTES TO FINANCIAL STATEMENTS as of August 31, 2006 (Unaudited) (continued)

NOTE 12 — INFORMATION REGARDING TRADING OF ING'S US MUTUAL FUNDS (continued)

In addition to the arrangements discussed above, in 2004 ING Investments reported to the Boards that, at that time, these instances include the following, in addition to the arrangements subject to the AWC discussed above:

•  Aeltus Investment Management, Inc. (a predecessor entity to ING Investment Management Co.) identified two investment professionals who engaged in extensive frequent trading in certain ING Funds. One was subsequently terminated for cause and incurred substantial financial penalties in connection with this conduct and the second has been disciplined.

•  ReliaStar Life Insurance Company ("ReliaStar") entered into agreements seven years ago permitting the owner of policies issued by the insurer to engage in frequent trading and to submit orders until 4pm Central Time. In 2001 ReliaStar also entered into a selling agreement with a broker-dealer that engaged in frequent trading. Employees of ING affiliates were terminated and/or disciplined in connection with these matters.

•  In 1998, Golden American Life Insurance Company entered into arrangements permitting a broker-dealer to frequently trade up to certain specific limits in a fund available in an ING variable annuity product. No employee responsible for this arrangement remains at the company.

For additional information regarding these matters, you may consult the Form 8-K and Form 8-K/A for each of four life insurance companies, ING USA Annuity and Life Insurance Company, ING Life Insurance and Annuity Company, ING Insurance Company of America, and ReliaStar Life Insurance Company of New York, each filed with the SEC on October 29, 2004 and September 8, 2004. These Forms 8-K and Forms 8-K/A can be accessed through the SEC's Web site at http://www.sec.gov. Despite the extensive internal review conducted through independent special counsel and a national accounting firm, there can be no assurance that the instances of inappropriate trading reported to the Boards are the only instances of such trading respecting the ING Funds.

ING Investments reported to the Boards that ING is committed to conducting its business with the highest standards of ethical conduct with zero tolerance for noncompliance. Accordingly, ING Investments advised the Boards that ING management was disappointed that its voluntary internal review identified these situations. Viewed in the context of the breadth and magnitude of its U.S. business as a whole, ING management does not believe that ING's acquired companies had systemic ethical or compliance issues in these areas. Nonetheless, ING Investments reported that given ING's refusal to tolerate any lapses, it has taken the steps noted below, and will continue to seek opportunities to further strengthen the internal controls of its affiliates.

•  ING has agreed with the ING Funds to indemnify and hold harmless the ING Funds from all damages resulting from wrongful conduct by ING or its employees or from ING's internal investigation, any investigations conducted by any governmental or self-regulatory agencies, litigation or other formal proceedings, including any proceedings by the SEC. ING Investments reported to the Boards that ING management believes that the total amount of any indemnification obligations will not be material to ING or its U.S. business.

•  ING updated its Code of Conduct for employees reinforcing its employees' obligation to conduct personal trading activity consistent with the law, disclosed limits, and other requirements.

•  The ING Funds, upon a recommendation from ING, updated their respective Codes of Ethics applicable to investment professionals with ING entities and certain other fund personnel, requiring such personnel to pre-clear any purchases or sales of ING Funds that are not systematic in nature (i.e., dividend reinvestment), and imposing minimum holding periods for shares of ING Funds.

21

---

ING Prime Rate Trust

NOTES TO FINANCIAL STATEMENTS as of August 31, 2006 (Unaudited) (continued)

NOTE 12 — INFORMATION REGARDING TRADING OF ING'S US MUTUAL FUNDS (continued)

•  ING instituted excessive trading policies for all customers in its variable insurance and retirement products and for shareholders of the ING Funds sold to the public through financial intermediaries. ING does not make exceptions to these policies.

•  ING reorganized and expanded its U.S. Compliance Department, and created an Enterprise Compliance team to enhance controls and consistency in regulatory compliance.

Other Regulatory Matters

The New York Attorney General (the "NYAG") and other federal and state regulators are also conducting broad inquiries and investigations involving the insurance industry. These initiatives currently focus on, among other things, compensation and other sales incentives; potential conflicts of interest; potential anti-competitive activity; reinsurance; marketing practices (including suitability); specific product types (including group annuities and indexed annuities); fund selection for investment products and brokerage sales; and disclosure. It is likely that the scope of these industry investigations will further broaden before they conclude. ING has received formal and informal requests in connection with such investigations, and is cooperating fully with each request. In connection with one such investigation, affiliates of ING Investments were named in a petition for relief and cease and desist order filed by the New Hampshire Bureau of Securities Regulation (the "NH Bureau") concerning their administration of the New Hampshire state employees deferred compensation plan.

On October 10, 2006, an affiliate of ING Investments entered into an assurance of discontinuance with the NYAG (the "NYAG Agreement") regarding the endorsement of its products by the New York State United Teachers Union Member Benefits Trust ("NYSUT") and the sale of their products to NYSUT members. Under the terms of the NYAG Agreement, the affiliate of ING Investments, without admitting or denying the NYAG's findings, will distribute $30 million to NYSUT members, and/or former NYSUT members, who participated in the NYSUT-endorsed products at any point between January 1, 2001 and June 30, 2006. The affiliate also agreed with the NYAG's office to develop a one-page disclosure that will further improve transparency and disclosure regarding retirement product fees (the "One-Page Disclosure"). Pursuant to the terms of the NYAG Agreement, the affiliate has agreed for a five year period to provide its retirement product customers with the One-Page Disclosure.

In addition, on the same date, these affiliates of ING Investments entered into a consent agreement with the NH Bureau (the "NH Agreement") to resolve this petition for relief and cease and desist order. Under the terms of the NH Agreement, these affiliates of ING Investments, without admitting or denying the NH Bureau's claims, have agreed to pay $3 million to resolve the matter, and for a five year period to provide their retirement product customers with the One-Page Disclosure described above.

Other federal and state regulators could initiate similar actions in this or other areas of ING's businesses.

These regulatory initiatives may result in new legislation and regulation that could significantly affect the financial services industry, including businesses in which ING is engaged.

In light of these and other developments, ING continuously reviews whether modifications to its business practices are appropriate.

At this time, in light of the current regulatory factors, ING U.S. is actively engaged in reviewing whether any modifications in our practices are appropriate for the future.

22

---

ING Prime Rate Trust

NOTES TO FINANCIAL STATEMENTS as of August 31, 2006 (Unaudited) (continued)

NOTE 12 — INFORMATION REGARDING TRADING OF ING'S US MUTUAL FUNDS (continued)

There can be no assurance that these matters, or the adverse publicity associated with them, will not result in increased fund redemptions, reduced sale of fund shares, or other adverse consequences to ING Funds.

NOTE 13 — SUBSEQUENT EVENTS

Subsequent to August 31, 2006, the Trust paid to Common Shareholders the following dividends from net investment income:

Per Share Amount

Declaration Date

Record Date

Payable Date

$

0.0475

8/31/06

9/11/06

9/22/06

$

0.0470

9/29/06

10/10/06

10/23/06

 

Subsequent to August 31, 2006, the Trust paid to Preferred Shareholders the following dividends from net investment income:

Preferred Shares

Total Per Share Amount

Auction Dates

Record Dates

Payable Dates

Series M

$

147.78

09/01/06 to 10/06/06

09/11/06 to 10/16/06

09/12/06 to 10/17/06

Series T

$

144.96

09/05/06 to 10/10/06

09/12/06 to 10/17/06

09/13/06 to 10/18/06

Series W

$

146.32

09/06/06 to 10/11/06

09/13/06 to 10/18/06

09/14/06 to 10/19/06

Series Th

$

145.65

09/07/06 to 10/12/06

09/14/06 to 10/19/06

09/15/06 to 10/20/06

Series F

$

143.27

09/01/06 to 10/06/06

09/08/06 to 10/13/06

09/11/06 to 10/16/06

 

23

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited)

Senior Loans*: 179.6%

Bank Loan Ratings†

Principal Amount

Borrower/Tranche Description

Moody's

S&P

Value

Aerospace & Defense: 2.3%

(2

)

Delta Air Lines, Inc.

Ba3

B+

$

2,000,000

Debtor in Possession Term Loan, 10.023%,

maturing March 16, 2008

$

2,050,782

Dyncorp, Inc.

Ba3

BB-

3,951,650

Term Loan, 7.813%-8.313%, maturing February 11, 2011

3,973,878

Hexcel Corporation

Ba3

BB-

1,230,219

Term Loan, 7.063%-7.250%, maturing March 01, 2012

1,233,294

IAP Worldwide Services, Inc.

B2

B

995,000

Term Loan, 8.500%, maturing December 30, 2012

1,001,012

K&F Industries, Inc.

B2

B+

4,395,833

Term Loan, 7.330%, maturing November 18, 2012

4,406,823

Spirit Aerosystems, Inc.

B1

BB-

1,155,000

Term Loan, 7.750%, maturing December 31, 2011

1,162,074

Transdigm, Inc.

B1

B+

3,500,000

Term Loan, 7.449%, maturing June 23, 2013

3,517,500

United Air Lines, Inc.

B1

B+

2,483,125

Term Loan, 9.250%, maturing February 01, 2012

2,520,372

US Airways Group, Inc.

B2

B

3,000,000

Term Loan, 8.999%, maturing March 31, 2011

3,018,126

Wyle Holdings, Inc.

NR

B+

1,897,200

Term Loan, 8.220%, maturing January 28, 2011

1,907,872

24,791,733

Automobile: 7.4%

Accuride Corporation

B1

B+

5,594,545

Term Loan, 7.313%, maturing January 31, 2012

5,615,525

American Axle & Manufacturing, Inc.

Ba3

BB

500,000

Term Loan, 9.500%, maturing April 02, 2010

499,688

1,500,000

Term Loan, 9.813%, maturing April 12, 2010

1,499,063

Arvinmeritor, Inc.

Ba1

BB+

625,000

Term Loan, 7.250%, maturing June 23, 2006

626,172

Avis Budget Holdings, LLC

Ba2

BBB-

2,935,714

Term Loan, 6.750%, maturing April 19, 2012

2,920,845

(2

)

Dana Corporation

B3

BB-

2,700,000

Debtor in Possession Term Loan, 7.650%, maturing April 13, 2008

2,705,738

 

See Accompanying Notes to Financial Statements

24

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

Bank Loan Ratings†

Principal Amount

Borrower/Tranche Description

Moody's

S&P

Value

Automobile: (continued)

(2

)

Federal-Mogul Corporation

NR

BBB+

$

1,500,000

Debtor in Possession Term Loan, 7.500%,

maturing December 09, 2006

$

1,504,688

2,270,000

Revolver, 7.625%-7.688%, maturing December 09, 2006

2,271,419

Goodyear Tire & Rubber Company

Ba3

BB

5,500,000

Term Loan, 7.041%, maturing April 30, 2010

5,511,787

Goodyear Tire & Rubber Company

B2

B+

9,400,000

Term Loan, 7.954%, maturing April 30, 2010

9,486,442

Hertz Corporation

Ba2

BB

1,027,778

Term Loan, 5.424%, maturing December 21, 2012

1,035,395

6,939,350

Term Loan, 7.620%-7.730%, maturing December 21, 2012

6,990,777

Keystone Automotive Industries, Inc.

B2

B+

1,149,833

Term Loan, 7.896%-7.990%, maturing October 30, 2009

1,151,270

1,492,500

Term Loan, 7.990%, maturing October 30, 2010

1,494,366

Lear Corporation

B2

B+

4,400,000

Term Loan, 7.904%-7.999%, maturing April 25, 2012

4,358,292

Motorsport Aftermarket Group, Inc.

B2

B

1,961,488

Term Loan, 8.500%, maturing December 15, 2011

1,967,618

(2

)

RJ Tower Corporation

Ba3

BBB

4,000,000

Debtor is Possession Term Loan, 8.250%, maturing February 02, 2007

4,045,000

Safelite Glass Corporation

B3

B+

3,564,652

Term Loan, 8.830%, maturing September 30, 2007

3,546,829

12,002,085

Term Loan, 9.330%, maturing September 30, 2007

11,942,075

TRW Automotive Acquisitions Corporation

Ba2

BB+

2,410,158

Term Loan, 7.188%, maturing June 30, 2012

2,410,324

United Components, Inc.

B2

BB-

2,266,033

Term Loan, 7.700%, maturing June 30, 2012

2,277,364

Vanguard Car Rental USA Holdings, Inc.

B2

B+

5,500,000

Term Loan, 8.319%, maturing June 14, 2013

5,513,063

Visteon Corporation

B1

B+

1,833,333

Term Loan, 8.610%, maturing June 20, 2007

1,831,729

81,205,469

Beverage, Food & Tobacco: 3.6%

Bolthouse Farms, Inc.

B2

B+

2,487,500

Term Loan, 7.813%, maturing December 16, 2012

2,509,783

 

See Accompanying Notes to Financial Statements

25

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

Bank Loan Ratings†

Principal Amount

Borrower/Tranche Description

Moody's

S&P

Value

Beverage, Food & Tobacco: (continued)

Bumble Bee Foods, LLC

Ba3

B+

$

1,200,000

Term Loan, 7.039%-7.250%,

maturing May 02, 2012

$

1,201,500

Commonwealth Brands, Inc.

B1

B+

8,435,250

Term Loan, 7.750%, maturing December 22, 2012

8,496,406

Constellation Brands, Inc.

Ba2

BB

416,667

Term Loan, 6.813%-7.000%, maturing June 05, 2013

418,490

Gate Gourmet Borrower, LLC

B2

B

169,681

Term Loan, 8.249%, maturing March 09, 2012

171,590

556,051

Term Loan, 8.249%, maturing March 09, 2012

557,441

Golden State Foods Corporation

B1

B+

3,910,000

Term Loan, 7.250%, maturing February 28, 2011

3,910,000

Keystone Foods Holdings, LLC

Ba3

B+

4,118,706

Term Loan, 7.125%-7.250%, maturing June 16, 2011

4,134,151

Le-Natures, Inc.

B1

B

308,435

Term Loan, 8.480%, maturing June 23, 2010

308,628

686,537

Term Loan, 7.880%-10.250%, maturing June 23, 2010

686,966

Michael Foods, Inc.

B1

B+

3,641,879

Term Loan, 7.032%-7.553%, maturing November 21, 2010

3,654,778

Nutro Products, Inc.

B1

B

2,173,000

Term Loan, 7.265%, maturing April 26, 2013

2,177,074

Pierre Foods, Inc.

B1

B+

3,566,667

Term Loan, 6.930%, maturing June 30, 2010

3,578,929

Reynolds American, Inc.

Ba1

BBB-

5,000,000

Term Loan, 7.188%-7.313%, maturing May 31, 2012

5,027,735

Sturm Foods, Inc.

B1

B

2,000,000

Term Loan, 7.750%, maturing May 26, 2011

2,007,500

38,840,971

Buildings & Real Estate: 7.9%

Atrium Companies, Inc.

B2

B

758,275

Term Loan, 8.080%-8.250%, maturing May 31, 2012

735,526

Builders Firstsource, Inc.

B1

BB-

888,889

Term Loan, 8.008%, maturing August 11, 2011

891,111

Building Materials Holding Corporation

Ba2

BB

1,940,000

Term Loan, 7.250%, maturing June 30, 2010

1,953,338

Capital Automotive REIT

Ba1

BB+

11,721,432

Term Loan, 7.160%, maturing December 16, 2010

11,754,803

 

See Accompanying Notes to Financial Statements

26

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

Bank Loan Ratings†

Principal Amount

Borrower/Tranche Description

Moody's

S&P

Value

Buildings & Real Estate: (continued)

Champion Home Builders Company

B1

B+

$

875,000

Term Loan, 5.399%,

maturing October 31, 2012

$

878,828

992,500

Term Loan, 7.830%, maturing October 31, 2012

996,842

Contech Construction Products, Inc.

B1

B+

1,742,222

Term Loan, 7.330%-7.500%, maturing January 31, 2013

1,746,034

Custom Building Products, Inc.

B1

B+

4,964,660

Term Loan, 7.749%, maturing October 29, 2011

4,996,722

Headwaters, Inc.

Ba3

BB-

3,619,713

Term Loan, 7.330%-7.500%, maturing April 30, 2011

3,640,074

Hearthstone Housing Partners II, LLC

NR

NR

3,861,765

Revolver, 7.330%, maturing December 01, 2007

3,852,111

Lion Gables Realty, L.P.

Ba2

BB+

1,505,206

Term Loan, 7.120%, maturing September 30, 2006

1,506,931

Lnr Property Corporation

B2

B+

2,000,000

Term Loan, 8.220%, maturing July 12, 2011

2,015,000

Maguire Properties, Inc.

Ba2

BB+

742,222

Term Loan, 7.080%, maturing March 15, 2010

744,542

Masonite International Corporation

B2

BB-

4,433,723

Term Loan, 7.490%-7.499%, maturing April 05, 2013

4,370,543

4,441,277

Term Loan, 7.490%-7.499%, maturing April 05, 2013

4,377,988

NCI Building Systems, Inc.

Ba2

BB

1,888,835

Term Loan, 6.710%, maturing June 18, 2010

1,890,016

Newkirk Master, L.P.

Ba2

BB+

1,234,534

Term Loan, 7.152%, maturing August 11, 2008

1,236,849

961,763

Term Loan, 7.152%-8.750%, maturing August 11, 2008

963,567

Nortek, Inc.

B2

B

7,034,269

Term Loan, 7.360%, maturing August 27, 2011

7,017,781

PGT Industries, Inc.

B2

B+

2,123,256

Term Loan, 8.410%, maturing February 14, 2012

2,135,199

Ply Gem Industries, Inc.

B1

BB-

155,703

Term Loan, 7.580%-7.650%, maturing August 15, 2011

155,119

2,335,547

Term Loan, 7.580%-7.650%, maturing August 15, 2011

2,326,789

Shea Capital I, LLC

Ba2

BB-

1,000,000

Term Loan, 7.490%, maturing October 27, 2011

997,500

 

See Accompanying Notes to Financial Statements

27

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

Bank Loan Ratings†

Principal Amount

Borrower/Tranche Description

Moody's

S&P

Value

Buildings & Real Estate: (continued)

Spanish Peaks, LLC

B1

B+

$

287,541

Term Loan, 2.850%,

maturing August 09, 2011

$

284,307

271,348

Term Loan, 7.790%-8.198%, maturing August 09, 2011

268,295

St. Marys Cement, Inc.

Ba3

BB-

5,369,849

Term Loan, 7.499%, maturing December 04, 2009

5,383,274

Trizec Properties, Inc.

NR

BB+

12,400,000

Term Loan, 6.775%, maturing May 02, 2007

12,398,066

Trustreet Properties, Inc.

Ba3

BB

4,000,000

Term Loan, 7.402%, maturing April 08, 2010

4,022,500

Yellowstone Mountain Club

B1

BB-

2,377,333

Term Loan, 7.705%, maturing September 30, 2010

2,370,275

85,909,930

Cargo Transport: 1.9%

Baker Tanks, Inc.

B2

B

1,985,000

Term Loan, 7.830%-7.999%, maturing November 22, 2012

1,997,406

Gainey Corporation

B2

BB-

800,000

Term Loan, 8.080%, maturing April 20, 2012

806,000

Helm Holding Corporation

B2

B+

983,989

Term Loan, 7.960%-7.999%, maturing July 08, 2011

987,064

Horizon Lines, LLC

B2

B

2,450,000

Term Loan, 7.750%, maturing July 07, 2011

2,459,954

Kenan Advantage Group, Inc.

B3

B+

995,000

Term Loan, 8.499%, maturing December 16, 2011

1,001,219

(3)

Neoplan USA Corporation

NR

NR

1,867,500

Revolver, maturing June 30, 2006

1,867,500

5,306,058

Term Loan, maturing June 30, 2006

4,457,089

Pacer International, Inc.

Ba3

BB

941,177

Term Loan, 6.813%-7.063%, maturing June 10, 2010

938,824

Railamerica, Inc.

Ba3

BB

365,845

Term Loan, 7.438%, maturing September 29, 2011

367,332

3,094,852

Term Loan, 7.438%, maturing September 29, 2011

3,107,426

Transport Industries, L.P.

B2

B+

1,209,308

Term Loan, 8.000%, maturing September 30, 2011

1,214,599

United States Shipping, LLC

B1

B+

2,000,000

Term Loan, 8.910%, maturing April 30, 2010

2,015,000

21,219,413

 

See Accompanying Notes to Financial Statements

28

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

Bank Loan Ratings†

Principal Amount

Borrower/Tranche Description

Moody's

S&P

Value

Cellular: 2.6%

Cellular South, Inc.

Ba3

B+

$

1,960,000

Term Loan, 7.240%-8.750%,

maturing May 04, 2011

$

1,961,838

Centennial Cellular Operating Company

B2

B

10,085,631

Term Loan, 7.318%-7.749%, maturing February 09, 2011

10,165,771

Cricket Communications, Inc.

B2

B

6,000,000

Term Loan, 8.249%, maturing June 16, 2013

6,053,250

IWO Holdings, Inc.

Baa2

BBB+

3,175,000

Floating Rate Note, 9.257%, maturing January 15, 2012

3,278,188

Ntelos, Inc.

B2

B

4,432,552

Term Loan, 7.580%, maturing August 24, 2011

4,434,215

Rogers Wireless, Inc.

Ba2

BB

2,500,000

Floating Rate Note, 8.454%, maturing December 15, 2010

2,565,625

28,458,887

Chemicals, Plastics & Rubber: 10.8%

Basell Finance Company

Ba3

B+

741,886

Term Loan, 7.580%, maturing September 07, 2013

751,856

148,377

Term Loan, 7.580%, maturing September 07, 2013

150,371

741,886

Term Loan, 7.580%, maturing September 07, 2014

751,856

148,377

Term Loan, 7.580%, maturing September 07, 2014

150,371

Brenntag Holdings GMBH & Co.

B2

B+

1,178,182

Term Loan, 8.080%, maturing January 17, 2014

1,185,811

3,621,818

Term Loan, 8.080%, maturing January 17, 2014

3,645,269

Celanese, AG

B1

BB-

5,330,539

Term Loan, 7.499%, maturing April 06, 2011

5,353,860

5,625,000

Term Loan, 5.406%, maturing April 06, 2009

5,667,188

Columbian Chemicals Company

Ba3

BB-

600,000

Term Loan, 7.250%, maturing March 16, 2013

599,625

Covalence Specialty Materials Corporation

Ba3

B+

1,957,143

Term Loan, 7.375%, maturing May 18, 2013

1,957,143

Covalence Specialty Materials Corporation

B2

B-

500,000

Term Loan, 8.575%, maturing August 16, 2013

505,521

Hawkeye Renewables, LLC

B3

NR

3,750,000

Term Loan, 9.400%-9.543%, maturing January 31, 2012

3,724,219

 

See Accompanying Notes to Financial Statements

29

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

Bank Loan Ratings†

Principal Amount

Borrower/Tranche Description

Moody's

S&P

Value

Chemicals, Plastics & Rubber: (continued)

Hexion Specialty Chemicals, Inc.

B2

B+

$

5,422,154

Term Loan, 7.563%, maturing May 05, 2013

$

5,374,146

1,177,846

Term Loan, 7.500%, maturing May 05, 2013

1,167,418

1,200,000

Term Loan, 7.234%, maturing May 05, 2013

1,189,375

Huntsman International, LLC

Ba3

BB-

20,844,399

Term Loan, 7.076%, maturing August 16, 2012

20,818,343

Ineos US Finance, LLC

Ba3

B+

2,800,000

Term Loan, 7.339%, maturing December 16, 2012

2,815,313

3,000,000

Term Loan, 7.339%, maturing December 16, 2013

3,027,813

3,000,000

Term Loan, 7.339%, maturing December 23, 2014

3,027,813

Innophos, Inc.

B2

B

1,287,955

Term Loan, 7.580%-7.750%, maturing August 13, 2010

1,292,784

ISP Chemco, Inc.

Ba3

BB-

3,491,250

Term Loan, 7.438%-7.625%, maturing February 16, 2013

3,494,668

JohnsonDiversey, Inc.

B1

B

508,666

Term Loan, 7.930%, maturing December 16, 2010

512,005

2,701,849

Term Loan, 7.970%, maturing December 16, 2011

2,725,490

Kraton Polymers, LLC

B1

B+

1,795,500

Term Loan, 7.375%, maturing May 12, 2013

1,797,744

Lucite International US Finco, Ltd.

B1

B+

711,832

Term Loan, 8.160%, maturing July 07, 2013

718,061

Nalco Company

B1

BB-

14,705,207

Term Loan, 7.120%-7.300%, maturing November 04, 2010

14,726,927

Northeast Biofuels, LLC

B1

B+

1,268,293

Term Loan, 8.749%, maturing June 30, 2013

1,277,805

Polypore, Inc.

B2

B

6,971,824

Term Loan, 8.330%, maturing November 12, 2011

7,035,735

PQ Corporation

B1

B+

2,468,750

Term Loan, 7.500%, maturing February 11, 2012

2,476,978

Rockwood Specialties Group, Inc.

B1

B+

14,875,625

Term Loan, 7.485%, maturing December 13, 2013

14,963,956

Supresta, LLC

B1

B

2,092,099

Term Loan, 8.750%, maturing July 20, 2011

2,065,948

 

See Accompanying Notes to Financial Statements

30

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

Bank Loan Ratings†

Principal Amount

Borrower/Tranche Description

Moody's

S&P

Value

Chemicals, Plastics & Rubber: (continued)

Vertellus Specialties, Inc.

B3

B+

$

2,375,000

Term Loan, 8.610%, maturing July 10, 2013

$

2,379,453

117,330,865

Containers, Packaging & Glass: 5.8%

Berry Plastics Corporation

B1

B+

5,789,057

Term Loan, 7.080%, maturing December 02, 2011

5,790,261

Bluegrass Container Company

Ba3

BB-

1,203,788

Term Loan, 7.580%, maturing June 30, 2013

1,213,569

Boise Cascade Corporation

Ba3

BB

6,094,702

Term Loan, 7.094%-7.250%, maturing October 29, 2011

6,124,134

Graham Packaging Company, L.P.

B2

B

14,317,198

Term Loan, 7.563%-7.875%, maturing October 07, 2011

14,370,888

Graphic Packaging International, Inc.

B1

B+

9,653,154

Term Loan, 7.620%-8.140%, maturing August 08, 2010

9,753,991

Intertape Polymer Group, Inc.

Ba3

B+

2,701,875

Term Loan, 7.550%-7.760%, maturing July 28, 2011

2,730,582

Owens-Illinois Group, Inc.

B1

BB-

2,843,750

Term Loan, 7.080%, maturing April 01, 2008

2,848,016

EUR

2,250,000

Term Loan, 4.856%, maturing May 23, 2013

2,883,152

Pro Mach, Inc.

B1

B

$

2,493,750

Term Loan, 7.750%,

maturing December 01, 2011

2,512,453

Smurfit-Stone Container Corporation

Ba3

B+

6,782,348

Term Loan, 7.500%-7.688%, maturing November 01, 2011

6,827,071

3,172,870

Term Loan, 7.500%-7.688%, maturing November 01, 2011

3,193,792

Solo Cup, Inc.

B2

B+

2,024,009

Term Loan, 7.610%-7.999%, maturing February 27, 2011

2,028,527

Xerium Technologies, Inc.

B1

B+

3,553,593

Term Loan, 7.749%, maturing May 18, 2012

3,544,709

63,821,145

Data and Internet Services: 4.6%

Activant Solutions, Inc.

B2

B

997,500

Term Loan, 7.438%-7.500%, maturing May 01, 2013

985,031

Aspect Software, Inc.

B2

B+

625,000

Term Loan, 8.500%, maturing July 11, 2011

626,875

(5)

Carlson Wagonlit Holdings, B.V.

Ba3

B+

2,750,000

Term Loan, maturing July 01, 2014

2,746,563

 

See Accompanying Notes to Financial Statements

31

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

Bank Loan Ratings†

Principal Amount

Borrower/Tranche Description

Moody's

S&P

Value

Data and Internet Services: (continued)

iPayment, Inc.

B2

B

$

2,992,500

Term Loan, 7.580%-7.750%,

maturing May 10, 2013

$

2,994,370

JDA Software Group, Inc.

B1

B+

1,500,000

Term Loan, 7.656%-7.848%, maturing July 05, 2013

1,502,813

Sungard Data Systems, Inc.

B1

B+

28,680,076

Term Loan, 7.999%, maturing February 11, 2013

28,923,340

(5)

TDS Investor Corporation

B1

B+

284,794

Term Loan, maturing August 22, 2013

286,084

2,985,549

Term Loan, maturing August 22, 2013

2,999,076

Transaction Network Services, Inc.

Ba3

BB-

3,088,853

Term Loan, 7.391%, maturing May 04, 2012

3,088,853

Transfirst Holdings, Inc.

B2

B+

875,000

Term Loan, 7.820%, maturing March 31, 2010

880,469

Worldspan, L.P.

B2

B

4,762,306

Term Loan, 8.063%-8.250%, maturing February 11, 2010

4,774,212

49,807,686

Diversified Natural Resources, Precious Metals & Minerals: 3.3%

Georgia-Pacific Corporation

Ba2

BB-

32,238,000

Term Loan, 7.300%-7.499%, maturing December 20, 2012

32,302,927

Georgia-Pacific Corporation

Ba3

B+

3,250,000

Term Loan, 8.300%, maturing December 20, 2013

3,283,176

35,586,103

Diversified / Conglomerate Manufacturing: 4.4%

Aearo Technologies, Inc.

B2

B+

1,596,000

Term Loan, 7.960%, maturing March 24, 2013

1,612,292

Aearo Technologies, Inc.

Caa1

CCC+

1,200,000

Term Loan, 11.960%, maturing September 24, 2013

1,222,500

Axia, Inc.

B2

B

1,492,500

Term Loan, 8.750%, maturing December 21, 2012

1,496,231

Brand Services, Inc.

B2

B

3,109,871

Term Loan, 7.650%-7.735%, maturing January 15, 2012

3,113,759

Chart Industries, Inc

B1

B+

2,000,001

Term Loan, 7.563%, maturing October 17, 2012

2,007,501

Cinram International, Inc.

B1

BB-

4,000,000

Term Loan, 7.222%, maturing May 05, 2011

3,994,376

Dresser Rand, Inc.

B1

B+

760,402

Term Loan, 7.110%-7.618%, maturing October 29, 2007

764,870

 

See Accompanying Notes to Financial Statements

32

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

Bank Loan Ratings†

Principal Amount

Borrower/Tranche Description

Moody's

S&P

Value

Diversified / Conglomerate Manufacturing: (continued)

Dresser, Inc.

B1

B

$

527,976

Term Loan, 7.830%, maturing April 10, 2009

$

533,255

Flowserve Corporation

Ba3

BB-

3,745,100

Term Loan, 6.750%-7.000%, maturing August 10, 2012

3,755,635

Gentek, Inc.

B2

B+

2,342,211

Term Loan, 7.580%-7.760%, maturing February 28, 2011

2,355,386

Goodman Global Holdings, Inc.

B1

B+

1,769,286

Term Loan, 7.250%, maturing December 23, 2011

1,765,416

Mark IV Industries, Inc.

B1

BB

500,000

Term Loan, 7.900%-8.100%, maturing June 21, 2011

505,104

Mueller Group, Inc.

B1

BB-

7,578,530

Term Loan, 7.330%-7.868%, maturing October 03, 2012

7,636,043

Norcross Safety Products, LLC

B1

BB-

989,875

Term Loan, 7.513%-9.250%, maturing June 30, 2012

992,041

(5

)

Prysmian, S.R.L.

NR

NR

EUR

1,200,000

Term Loan, maturing August 31, 2014

1,543,447

EUR

300,000

Term Loan, maturing August 31, 2015

386,823

Sensata Technologies, B.V.

B1

BB-

$

4,200,000

Term Loan, 7.080%-7.240%,

maturing April 27, 2013

4,177,874

Sensus Metering Systems, Inc.

B2

B+

1,582,609

Term Loan, 7.399%-7.583%, maturing December 17, 2010

1,582,609

210,217

Term Loan, 7.399%-7.583%, maturing December 17, 2010

210,217

Springs Window Fashions, LLC

B1

B+

995,000

Term Loan, 8.250%, maturing December 30, 2012

1,006,194

TFS Acquisition Corporation

B2

B+

1,500,000

Term Loan, 8.830%, maturing August 11, 2013

1,511,250

Universal Compression, Inc.

Ba2

BB

2,957,555

Term Loan, 7.000%, maturing February 15, 2012

2,960,019

Walter Industries Inc.

Ba3

B+

1,444,572

Term Loan, 6.870%-7.249%, maturing October 03, 2012

1,449,086

Waterpik Technologies, Inc.

B1

BB-

1,500,000

Term Loan, 7.730%, maturing June 30, 2013

1,500,470

48,082,398

Diversified / Conglomerate Service: 4.3%

Affinion Group, Inc.

B1

B+

3,627,907

Term Loan, 8.075%-8.176%, maturing October 17, 2012

3,654,550

 

See Accompanying Notes to Financial Statements

33

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

Bank Loan Ratings†

Principal Amount

Borrower/Tranche Description

Moody's

S&P

Value

Diversified / Conglomerate Service: (continued)

CCC Information Services, Inc.

B1

B

$

1,000,000

Term Loan, 8.000%,

maturing February 10, 2013

$

1,005,833

Fidelity National Information Solutions, Inc.

Ba1

BB+

25,501,031

Term Loan, 7.080%, maturing March 09, 2013

25,597,604

Iron Mountain, Inc.

Ba3

BB-

6,877,500

Term Loan, 7.094%, maturing April 02, 2011

6,897,562

2,240,410

Term Loan, 7.156%, maturing April 02, 2011

2,245,077

Mitchell International, Inc.

B1

B+

698,651

Term Loan, 7.500%, maturing August 15, 2011

701,490

US Investigations Services, LLC

B2

B+

4,439,693

Term Loan, 7.920%, maturing October 14, 2012

4,445,242

Vertafore, Inc.

B1

B+

1,067,000

Term Loan, 7.830%-7.900%, maturing January 31, 2012

1,072,335

Vertafore, Inc.

B3

CCC+

875,000

Term Loan, 11.400%-11.461%, maturing January 31, 2013

888,490

46,508,183

Ecological: 1.5%

Allied Waste North America, Inc.

B1

BB

7,470,022

Term Loan, 7.200%-7.270%, maturing January 15, 2012

7,464,187

3,191,130

Term Loan, 7.084%, maturing January 15, 2012

3,188,970

Envirosolutions, Inc.

B2

B-

2,750,000

Term Loan, 8.810%-9.000%, maturing July 07, 2012

2,770,625

IESI Corporation

Ba3

BB

1,800,000

Term Loan, 6.939%-7.248%, maturing January 14, 2012

1,802,813

Wastequip, Inc.

B2

B

1,529,756

Term Loan, 7.749%, maturing July 15, 2011

1,533,580

16,760,175

Electronics: 1.7%

Decision One Corporation

NR

NR

1,530,088

Term Loan, 12.000%, maturing April 15, 2010

1,530,088

Eastman Kodak Company

B1

B+

2,117,647

Term Loan, 7.655%-7.757%, maturing October 18, 2012

2,119,159

5,782,644

Term Loan, 7.649%-7.750%, maturing October 18, 2012

5,787,646

ON Semiconductor Corporation

B2

B+

5,895,481

Term Loan, 7.750%, maturing December 15, 2011

5,910,219

 

See Accompanying Notes to Financial Statements

34

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

Bank Loan Ratings†

Principal Amount

Borrower/Tranche Description

Moody's

S&P

Value

Electronics: (continued)

Serena Software Inc.

B1

B

$

2,438,906

Term Loan, 7.410%,

maturing March 11, 2013

$

2,438,601

SI International, Inc.

B1

B+

1,120,737

Term Loan, 7.330%-7.460%, maturing February 09, 2011

1,122,138

18,907,851

Finance: 1.7%

Ameritrade Holding Corporation

Ba1

BB

5,875,909

Term Loan, 6.830%, maturing December 31, 2012

5,875,909

LPL Holdings, Inc.

B2

B

4,975,000

Term Loan, 8.130%-8.749%, maturing June 28, 2013

5,036,411

Nasdaq Stock Market, Inc.

Ba3

BB+

5,141,731

Term Loan, 6.971%-7.249%, maturing April 18, 2012

5,142,374

2,980,542

Term Loan, 7.030%-7.249%, maturing April 18, 2012

2,980,914

19,035,608

Foreign Cable, Foreign TV, Radio and Equipment: 2.0%

(5

)

ENO France SAS

NR

NR

EUR

3,000,000

Term Loan, maturing July 30, 2014

3,811,769

German Media Partners, L.P.

NR

B+

EUR

5,000,000

Term Loan, 7.070%,

maturing July 08, 2011

6,384,983

(5

)

NTL Investment Holding, Ltd.

Ba3

BB-

$

6,000,000

Term Loan, maturing December 31, 2012

5,991,000

UPC Financing Partnership

B1

B

EUR

2,200,000

Term Loan, 5.507%,

maturing March 12, 2013

2,814,055

EUR

2,200,000

Term Loan, 5.507%,

maturing December 31, 2013

2,816,169

21,817,976

Gaming: 5.8%

Ameristar Casinos, Inc.

Ba3

BB+

$

1,990,000

Term Loan, 6.830%-6.900%,

maturing November 10, 2012

1,990,933

Boyd Gaming Corporation

Ba2

BB

5,620,000

Term Loan, 6.610%-6.999%, maturing June 30, 2011

5,627,491

CCM Merger, Inc.

B1

B

5,446,239

Term Loan, 7.236%-7.490%, maturing July 13, 2012

5,436,027

Global Cash Access, LLC

Ba3

B+

1,715,187

Term Loan, 7.080%, maturing March 10, 2010

1,715,187

 

See Accompanying Notes to Financial Statements

35

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

Bank Loan Ratings†

Principal Amount

Borrower/Tranche Description

Moody's

S&P

Value

Gaming: (continued)

Green Valley Ranch Gaming, LLC

NR

NR

$

150,000

Revolver, 6.944%-7.025%,

maturing December 23, 2008

$

149,625

2,447,725

Term Loan, 7.499%, maturing December 17, 2011

2,450,785

Herbst Gaming, Inc.

B1

B+

987,500

Term Loan, 7.110%-7.499%, maturing January 31, 2011

989,352

Isle of Capri Black Hawk, LLC

B1

B+

1,323,333

Term Loan, 7.300%-7.510%, maturing October 24, 2011

1,321,679

Isle of Capri Casinos, Inc.

Ba2

BB-

990,000

Term Loan, 7.249%, maturing February 04, 2011

991,733

1,477,500

Term Loan, 7.008%-7.322%, maturing February 04, 2011

1,480,086

Opbiz, LLC

B3

B-

7,228,422

Term Loan, 8.508%, maturing August 31, 2010

7,013,377

19,228

Term Loan, 8.990%, maturing August 31, 2010

18,687

Penn National Gaming, Inc.

Ba2

BB

1,279,070

Term Loan, 7.250%, maturing October 03, 2011

1,283,067

13,398,750

Term Loan, 7.020%-7.250%, maturing October 03, 2012

13,467,419

Ruffin Gaming, LLC

NR

NR

1,485,376

Term Loan, 7.750%, maturing June 28, 2008

1,500,230

Trump Entertainment Resorts Holdings, L.P.

B2

BB-

1,732,500

Term Loan, 7.920%-8.030%, maturing May 20, 2012

1,746,036

Venetian Casino Resorts, LLC

Ba3

BB-

9,948,718

Term Loan, 7.250%, maturing June 15, 2011

9,949,494

2,393,163

Term Loan, 7.250%, maturing June 15, 2011

2,393,350

Venetian Macau, Ltd.

Ba3

BB-

1,200,000

Term Loan, 8.200%, maturing May 26, 2013

1,206,000

Yonkers Racing Corporation

B3

B

1,251,048

Term Loan, 8.828%-8.830%, maturing August 12, 2011

1,262,776

748,952

Term Loan, 8.828%-8.830%, maturing August 12, 2011

755,974

62,749,308

Grocery: 0.8%

Roundy's Supermarkets, Inc.

B2

B+

4,975,000

Term Loan, 8.290%-8.440%, maturing November 03, 2011

5,029,417

 

See Accompanying Notes to Financial Statements

36

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

Bank Loan Ratings†

Principal Amount

Borrower/Tranche Description

Moody's

S&P

Value

Grocery: (continued)

Supervalu, Inc.

Ba3

BB-

$

3,990,000

Term Loan, 7.063%,

maturing June 02, 2012

$

3,990,251

9,019,668

Healthcare, Education and Childcare: 14.6%

Accellent Corporation

B2

BB-

1,990,000

Term Loan, 7.330%-7.400%, maturing November 22, 2012

1,987,513

AGA Medical Corporation

B2

B+

1,995,000

Term Loan, 7.680%-7.720%, maturing April 28, 2013

1,998,741

Ameripath, Inc.

B1

BB-

498,750

Term Loan, 7.390%, maturing October 31, 2012

498,999

AMN Healthcare, Inc.

Ba2

BB-

857,979

Term Loan, 7.249%, maturing November 02, 2011

859,856

AMR Holdco, Inc./Emcare Holdco, Inc.

B2

B+

3,251,781

Term Loan, 7.270%-7.370%, maturing February 10, 2012

3,258,896

Block Vision Holdings Corporation

NR

NR

13,365

Term Loan, 13.000%, maturing July 30, 2007

—

Capella Healthcare, Inc.

B3

B

2,985,000

Term Loan, 8.240%, maturing November 30, 2012

3,005,522

CCS Acquisition, Inc.

B3

B

4,477,500

Term Loan, 8.750%, maturing September 30, 2012

4,344,106

Community Health Systems, Inc.

Ba3

BB-

19,128,524

Term Loan, 7.080%-7.150%, maturing August 19, 2011

19,143,463

Compsych Investment Corporation

NR

NR

992,500

Term Loan, 7.860%-8.250%, maturing April 20, 2012

997,463

Concentra Operating Corporation

B1

B+

4,662,082

Term Loan, 7.500%-7.620%, maturing September 30, 2011

4,677,378

CRC Health Corporation

B1

B

1,496,250

Term Loan, 7.749%, maturing February 06, 2013

1,498,120

Davita, Inc.

B1

BB-

20,096,926

Term Loan, 7.110%-7.690%, maturing October 05, 2012

20,182,157

DJ Orthopedics, LLC

Ba3

BB-

1,179,857

Term Loan, 6.875%-7.063%, maturing April 07, 2013

1,176,908

Education Management Corporation

B2

B

6,000,000

Term Loan, 8.063%, maturing June 01, 2013

6,035,628

 

See Accompanying Notes to Financial Statements

37

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

Bank Loan Ratings†

Principal Amount

Borrower/Tranche Description

Moody's

S&P

Value

 

Healthcare, Education and Childcare: (continued)

Encore Medical IHC, Inc.

B1

B

$

2,286,984

Term Loan, 8.281%-8.500%,

maturing October 04, 2010

$

2,295,561

Fresenius Medical Care Holdings, Inc.

Ba2

BB

4,089,750

Term Loan, 6.775%-6.874%, maturing March 31, 2013

4,061,064

Gentiva Health Services, Inc.

Ba3

B+

2,878,378

Term Loan, 7.370%-7.890%, maturing March 31, 2013

2,885,574

Golden Gate National Senior Care Holdings, LLC

B1

B+

1,197,000

Term Loan, 7.959%-8.249%, maturing March 14, 2011

1,204,481

Healthcare Partners, LLC

B1

BB

2,798,680

Term Loan, 7.860%, maturing February 04, 2011

2,812,673

Healthsouth Corporation

B2

B+

4,636,364

Term Loan, 8.520%, maturing March 10, 2013

4,658,581

Iasis Healthcare Corporation

B1

B+

8,820,000

Term Loan, 7.730%-7.749%, maturing June 22, 2011

8,879,720

Lifepoint Hospitals, Inc.

Ba3

BB

13,180,938

Term Loan, 6.905%, maturing April 15, 2012

13,134,251

Magellan Health Services, Inc.

Ba3

BB

833,333

Term Loan, 7.079%-7.170%, maturing August 15, 2008

835,417

MMM Holdings, Inc.

B1

B

1,610,963

Term Loan, 7.750%, maturing August 16, 2011

1,612,474

Multiplan Corporation

B2

B+

1,530,118

Term Loan, 7.499%, maturing April 12, 2013

1,523,105

National Mentor Holdings, Inc.

B1

B

76,667

Term Loan, 7.840%, maturing June 29, 2013

77,050

1,256,667

Term Loan, 7.830%-7.860%, maturing June 29, 2013

1,262,950

Per-Se Technologies, Inc.

B1

B+

2,212,644

Term Loan, 7.330%-7.500%, maturing January 06, 2013

2,220,941

Quintiles Transnational Corporation

B1

BB-

2,643,375

Term Loan, 7.500%, maturing March 31, 2013

2,643,787

Radiation Therapy Services, Inc.

B1

BB

1,933,664

Term Loan, 7.499%, maturing December 16, 2012

1,933,664

Renal Advantage, Inc.

NR

B+

4,052,708

Term Loan, 7.840%, maturing October 06, 2012

4,075,505

 

See Accompanying Notes to Financial Statements

38

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

Bank Loan Ratings†

Principal Amount

Borrower/Tranche Description

Moody's

S&P

Value

Healthcare, Education and Childcare: (continued)

Rural/Metro Operating Company, LLC

B1

B

$

519,127

Term Loan, 5.256%,

maturing March 04, 2011

$

521,398

1,258,822

Term Loan, 7.502%-7.730%, maturing March 04, 2011

1,264,330

Select Medical Corporation

B1

BB-

2,468,750

Term Loan, 7.080%-8.750%, maturing February 24, 2012

2,433,257

Sterigenics International, Inc.

B2

B+

2,435,231

Term Loan, 8.330%, maturing June 14, 2011

2,450,451

Team Health, Inc.

B2

B+

2,985,000

Term Loan, 7.830%-7.900%, maturing November 23, 2012

3,000,859

(5

)

United Surgical Partners International, Inc.

B3

B

1,000,000

Term Loan, maturing August 04, 2013

1,004,375

Vanguard Health Holding Company II, LLC

B2

B

17,959,354

Term Loan, 7.749%-7.868%, maturing September 23, 2011

17,993,027

Ventiv Health, Inc.

Ba3

BB-

743,128

Term Loan, 6.999%, maturing October 05, 2011

738,252

VWR International, Inc.

B2

B+

3,701,897

Term Loan, 7.770%, maturing April 07, 2011

3,712,311

158,899,808

Home & Office Furnishings: 1.2%

Buhrmann U.S., Inc.

Ba3

BB-

3,905,300

Term Loan, 7.146%-7.218%, maturing December 23, 2010

3,912,622

National Bedding Company

B1

BB-

2,227,500

Term Loan, 7.350%-9.250%, maturing August 31, 2011

2,239,751

Simmons Company

B2

BB-

7,166,516

Term Loan, 7.125%-9.500%, maturing December 19, 2011

7,216,904

13,369,277

Insurance: 0.9%

(5

)

Concord RE, Ltd.

Ba2

BB+

875,000

Term Loan, maturing February 15, 2012

883,750

Conseco, Inc.

Ba3

BB-

5,549,140

Term Loan, 7.080%, maturing June 22, 2010

5,559,545

HMSC Corporation

B1

B+

1,496,250

Term Loan, 8.190%-8.248%, maturing November 16, 2011

1,503,731

Sedgewick CMS Holdings, Inc.

B1

B+

1,891,200

Term Loan, 7.330%-7.499%, maturing January 31, 2013

1,890,411

9,837,437

 

See Accompanying Notes to Financial Statements

39

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

Bank Loan Ratings†

Principal Amount

Borrower/Tranche Description

Moody's

S&P

Value

Leisure, Amusement, Entertainment: 8.5%

24-Hour Fitness Worldwide, Inc.

B2

B

$

3,241,875

Term Loan, 7.990%-8.120%,

maturing June 08, 2012

$

3,268,215

AMF Bowling Worldwide, Inc.

B2

B

1,437,277

Term Loan, 8.258%-8.619%, maturing August 27, 2009

1,449,405

(5

)

Cedar Fair, L.P.

Ba3

BB-

9,000,000

Term Loan, maturing July 10, 2012

9,055,314

Easton-Bell Sports, Inc.

B1

B+

997,500

Term Loan, 6.810%-7.080%, maturing March 16, 2012

998,954

Hallmark Entertainment, LLC

B1

B

1,750,000

Term Loan, 8.000%, maturing December 31, 2011

1,758,750

HIT Entertainment, Ltd.

B1

B

3,382,500

Term Loan, 7.700%, maturing March 20, 2012

3,402,230

Lodgenet Entertainment Corporation

Ba3

B+

2,484,918

Term Loan, 7.749%, maturing August 29, 2008

2,491,908

London Arena & Waterfront Finance, LLC

Ba3

B

798,000

Term Loan, 8.783%, maturing March 08, 2012

804,983

Metro-Goldwyn-Mayer Studios, Inc.

Ba3

B+

8,297,619

Term Loan, 7.749%, maturing April 08, 2011

8,269,316

33,416,250

Term Loan, 8.749%, maturing April 08, 2012

33,335,917

Panavision, Inc.

B1

B

997,500

Term Loan, 8.330%-8.485%, maturing March 30, 2011

1,007,787

Pure Fishing, Inc.

B1

B+

2,808,150

Term Loan, 8.500%-8.610%, maturing September 30, 2010

2,794,109

Six Flags Theme Parks, Inc.

B1

B-

2,378,456

Term Loan, 8.450%-8.480%, maturing June 30, 2009

2,417,317

Universal City Development Partners, L.P.

Ba3

BB-

4,900,000

Term Loan, 7.330%-7.510%, maturing June 09, 2011

4,910,721

WMG Acquisition Corporation

Ba2

B+

16,210,049

Term Loan, 7.205%-7.511%, maturing February 28, 2011

16,281,989

92,246,915

Lodging: 1.5%

Hotel Del Partners, L.P.

NR

NR

16,400,000

Term Loan, 6.949%, maturing January 09, 2008

16,400,000

16,400,000

 

See Accompanying Notes to Financial Statements

40

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

Bank Loan Ratings†

Principal Amount

Borrower/Tranche Description

Moody's

S&P

Value

Machinery: 2.0%

Alliance Laundry Holdings, LLC

B1

B

$

3,062,500

Term Loan, 7.620%,

maturing January 27, 2012

$

3,078,771

Enersys, Inc.

Ba3

BB

4,191,090

Term Loan, 7.030%-7.594%, maturing March 17, 2011

4,206,807

Maxim Crane Works, L.P.

B1

BB-

2,464,184

Term Loan, 7.325%-9.250%, maturing January 25, 2010

2,471,885

Rexnord Corporation

B1

B+

2,375,000

Term Loan, 8.000%-8.063%, maturing June 30, 2013

2,389,844

United Rentals (North America), Inc.

B2

BB-

10,100,833

Term Loan, 7.330%, maturing February 14, 2011

10,131,499

22,278,806

Mining, Steel, Iron & Nonprecious Metals: 1.1%

Alpha Natural Resources, LLC

B1

BB-

663,333

Term Loan, 7.249%, maturing October 26, 2012

663,644

Carmeuse Lime, Inc.

NR

NR

1,859,100

Term Loan, 7.250%, maturing May 02, 2011

1,863,748

Longyear Holdings, Inc.

B2

B+

212,954

Term Loan, 8.500%, maturing July 28, 2012

214,019

1,474,296

Term Loan, 8.500%, maturing July 28, 2012

1,481,668

Novelis, Inc.

Ba2

BB-

2,242,721

Term Loan, 7.718%, maturing January 07, 2012

2,253,928

3,895,253

Term Loan, 7.718%, maturing January 07, 2012

3,914,718

Oglebay Norton Company

B1

B+

1,600,000

Term Loan, 7.900%, maturing July 31, 2011

1,613,000

12,004,725

North American Cable: 20.8%

Atlantic Broadband Finance, LLC

B1

B

1,995,000

Term Loan, 7.990%, maturing August 04, 2012

2,014,950

Bragg Communications, Inc.

B1

NR

2,450,000

Term Loan, 7.330%, maturing August 31, 2011

2,456,125

Bresnan Communications, LLC

B1

B+

3,333,333

Term Loan, 7.030%-7.260%, maturing September 29, 2013

3,333,853

Bresnan Communications, LLC

B3

B-

1,000,000

Term Loan, 9.780%-10.010%, maturing March 29, 2014

1,025,000

 

See Accompanying Notes to Financial Statements

41

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

												Bank Loan Ratings†
Principal Amount								Borrower/Tranche Description				Moody's				S&P				Value
North American Cable: (continued)
					(2	)		Century Cable Holdings, LLC				Caa1				NR
$	1,230,000							Revolver, 9.250%,
								maturing March 31, 2009												$	1,181,239
	21,357,940							Term Loan, 10.250%, maturing June 30, 2009													20,797,294
	8,000,000							Term Loan, 10.250%, maturing December 31, 2009													7,755,000
								Cequel Communications, LLC				B1				B+
	17,150,000							Term Loan, 7.739%, maturing November 05, 2013													17,050,461
								Cequel Communications, LLC				Caa1				B-
	525,000							Term Loan, 9.989%, maturing May 05, 2014													509,250
								Cequel Communications II, LLC				NR				NR
	3,850,000							Term Loan, 10.489%, maturing October 30, 2007													3,864,438
								Charter Communications Operating, LLC				B2				B
	53,500,000							Term Loan, 8.125%, maturing April 28, 2013													53,696,924
								CSC Holdings, Inc.				Ba3				BB
	23,341,500							Term Loan, 6.988%-7.258%, maturing March 29, 2013													23,239,381
	1,000,000							Term Loan, 6.610%-7.008%, maturing February 24, 2012													993,073
				(2)				Hilton Head Communications, L.P.				Caa1				NR
	7,000,000							Revolver, 8.250%, maturing September 30, 2007													6,706,875
	8,500,000							Term Loan, 9.500%, maturing March 31, 2008													8,193,643
								Insight Midwest Holdings, LLC				Ba3				BB
	18,037,500							Term Loan, 7.375%, maturing December 31, 2009													18,151,172
								Knology, Inc.				B3				NR
	2,144,259							Term Loan, 7.985%-7.990%, maturing June 29, 2010													2,156,321
								Mediacom Communications Corporation				Ba3				BB-
	10,890,000							Term Loan, 7.002%-7.370%, maturing January 31, 2015													10,853,420
								Nextmedia Operating, Inc.				B1				B
	1,752,033							Term Loan, 7.330%, maturing November 15, 2012													1,746,558
	778,681							Term Loan, 7.406%, maturing November 15, 2012													776,248
				(2)				Olympus Cable Holdings, LLC				B2				NR
	7,500,000							Term Loan, 9.500%, maturing June 30, 2010													7,238,670
	21,000,000							Term Loan, 10.250%, maturing September 30, 2010													20,366,724
								Patriot Media and Communications, LLC				B1				B+
	2,641,270							Term Loan, 7.576%-7.650%, maturing March 31, 2013													2,659,841

 

See Accompanying Notes to Financial Statements

42

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

Bank Loan Ratings†

Principal Amount

Borrower/Tranche Description

Moody's

S&P

Value

North American Cable: (continued)

Patriot Media and Communications, LLC

B3

B-

$

1,000,000

Term Loan, 10.500%,

maturing October 04, 2013

$

1,022,500

Persona Communication, Inc.

B2

B

3,430,000

Term Loan, 8.499%, maturing August 01, 2011

3,434,288

Quebecor Media, Inc.

B2

B

2,985,000

Term Loan, 7.507%, maturing January 17, 2013

3,007,853

San Juan Cable, LLC

B1

B+

1,743,120

Term Loan, 7.270%, maturing October 31, 2012

1,747,478

Wideopenwest Finance, LLC

B2

B

1,000,000

Term Loan, 7.481%-7.758%, maturing May 01, 2014

1,001,339

226,979,918

Oil & Gas: 9.0%

Alon USA, Inc.

B2

BB-

1,777,778

Term Loan, 7.906%, maturing June 22, 2013

1,798,889

CDX Funding, LLC

NR

NR

2,000,000

Term Loan, 10.749%, maturing March 31, 2013

2,036,666

Cheniere LNG Holdings, LLC

NR

BB

6,947,500

Term Loan, 8.249%, maturing August 30, 2012

7,010,465

Coffeyville Resources, LLC

B1

BB-

1,000,000

Term Loan, 4.900%, maturing June 24, 2012

1,008,375

1,485,056

Term Loan, 7.625%-9.500%, maturing July 08, 2012

1,497,493

Complete Production Services, Inc.

B2

B

2,977,500

Term Loan, 7.660%, maturing September 12, 2012

2,990,991

(5

)

El Paso Corporation

B1

B+

6,250,000

Term Loan, maturing July 31, 2011

6,290,738

Epco Holdings, Inc.

Ba3

B+

11,632,500

Term Loan, 7.221%-7.490%, maturing August 18, 2010

11,713,381

Helix Energy Solutions Group, Inc.

B2

BB

5,200,000

Term Loan, 7.390%-7.640%, maturing July 01, 2013

5,206,032

J. Ray Mcdermott, S.A.

B1

B+

3,000,000

Term Loan, 7.770%, maturing June 06, 2012

3,007,500

Key Energy Services, Inc.

NR

NR

4,477,500

Term Loan, 8.900%-9.230%, maturing June 30, 2012

4,502,686

LB Pacific, L.P.

B1

B-

3,950,000

Term Loan, 7.729%-8.249%, maturing February 15, 2012

3,969,750

 

See Accompanying Notes to Financial Statements

43

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

Bank Loan Ratings†

Principal Amount

Borrower/Tranche Description

Moody's

S&P

Value

Oil & Gas: (continued)

Magellan Midstream Holdings, L.P.

Ba3

BB-

$

1,774,510

Term Loan, 7.424%, maturing

June 30, 2012

$

1,790,037

MEG Energy Corporation

Ba3

BB

2,793,000

Term Loan, 7.500%, maturing April 03, 2013

2,799,234

OPTI Canada, Inc.

Ba3

BB+

3,000,000

Term Loan, 7.078%-7.260%, maturing May 17, 2013

3,001,125

Regency Gas Services, LLC

B1

B+

2,000,000

Term Loan, 9.500%, maturing August 10, 2013

2,019,166

Niska Gas Storage, LLC

Ba3

BB-

424,242

Term Loan, maturing May 13, 2011

424,242

2,327,765

Term Loan, maturing May 12, 2013

2,327,765

444,341

Term Loan, maturing May 12, 2013

444,341

Semcrude, L.P.

Ba3

NR

5,210,962

Term Loan, 7.749%, maturing March 16, 2011

5,233,760

3,651,133

Term Loan, 7.579%-7.690%, maturing March 16, 2011

3,667,107

Targa Resources, Inc.

Ba3

B+

6,500,000

Term Loan, 7.580%, maturing October 31, 2007

6,509,477

1,000,000

Term Loan, 7.749%, maturing October 31, 2012

1,004,907

7,715,887

Term Loan, 7.580%-7.750%, maturing October 31, 2012

7,753,749

Venoco, Inc.

Caa1

B-

2,000,000

Term Loan, 9.750%-10.000%, maturing March 30, 2009

2,012,500

Vulcan Energy Corporation

Ba2

BB

4,840,471

Term Loan, 6.899%, maturing August 12, 2011

4,846,522

W&T Offshore, Inc.

B2

B+

2,900,000

Term Loan, 7.650%, maturing May 26, 2010

2,913,897

97,780,795

Other Broadcasting and Entertainment: 3.2%

Deluxe, Inc.

B1

B

1,922,072

Term Loan, 9.249%, maturing January 28, 2011

1,940,491

DirecTV Holdings, LLC

Ba1

BB

9,974,811

Term Loan, 6.824%, maturing April 13, 2013

9,987,280

Echostar DBS Corporation

Ba3

BB-

9,000,000

Floating Rate Term Loan, 8.758%, maturing October 01, 2008

9,112,500

 

See Accompanying Notes to Financial Statements

44

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

Bank Loan Ratings†

Principal Amount

Borrower/Tranche Description

Moody's

S&P

Value

Other Broadcasting and Entertainment: (continued)

Liberty Media Corporation

Ba2

BB+

$

4,500,000

Floating Rate Term Loan, 6.829%,

maturing September 17, 2006

$

4,501,530

Nielson Finance, LLC./VNU, Inc.

B1

B+

9,000,000

Term Loan, 8.190%, maturing August 9, 2013

8,972,226

34,514,027

Other Telecommunications: 4.7%

Asurion Corporation

B1

B

6,750,000

Term Loan, 8.330%, maturing August 15, 2012

6,766,875

Asurion Corporation

B3

CCC+

500,000

Term Loan, 11.580%, maturing February 15, 2013

506,250

(5

)

BCM Ireland Holdings, Ltd.

Ba3

BB-

EUR

2,083,333

Term Loan, maturing September 30, 2015

2,664,246

EUR

2,083,333

Term Loan, maturing September 30, 2015

2,678,194

Cavalier Telecom Corporation

B2

B

$

1,995,000

Term Loan, 9.990%,

maturing March 24, 2012

2,023,678

Choice One Communications, Inc.

Ba3

B

3,000,000

Term Loan, 9.500%, maturing June 30, 2012

3,024,375

Cincinnati Bell, Inc.

Ba3

B+

3,473,750

Term Loan, 6.828%-7.028%, maturing August 31, 2012

3,465,066

Consolidated Communications, Inc.

B1

BB-

2,452,170

Term Loan, 7.410%-7.450%, maturing October 14, 2011

2,453,702

D&E Communications, Inc.

Ba3

BB-

2,924,288

Term Loan, 7.270%-9.250%, maturing December 31, 2011

2,938,910

Fairpoint Communications, Inc.

B1

BB-

2,000,000

Term Loan, 7.250%, maturing February 08, 2012

1,988,126

Iowa Telecommunications Services, Inc.

Ba3

BB-

4,250,000

Term Loan, 7.150%-7.250%, maturing November 23, 2011

4,259,741

Paetec Communications, Inc.

B1

B

875,000

Term Loan, 8.875%, maturing June 12, 2012

881,198

Qwest Capital Funding, Inc.

B2

B

10,000,000

Floating Rate Term Loan, 8.905%, maturing February 15, 2009

10,150,000

Time Warner Telecom Holdings, Inc.

B2

CCC+

3,000,000

Floating Rate Term Loan, 9.405%, maturing February 15, 2011

3,060,000

U.S. Telepacific Corporation

B2

B-

1,000,000

Term Loan, 9.920%, maturing August 04, 2011

1,010,000

 

See Accompanying Notes to Financial Statements

45

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

Bank Loan Ratings†

Principal Amount

Borrower/Tranche Description

Moody's

S&P

Value

Other Telecommunications: (continued)

Windstream Corporation

Ba2

BBB-

$

2,875,000

Term Loan, 7.260%,

maturing July 17, 2013

$

2,893,483

50,763,844

Personal & Nondurable Consumer Products: 5.1%

Advantage Sales & Marketing, Inc.

B2

B

3,092,250

Term Loan, 7.330%-7.460%, maturing March 29, 2013

3,075,499

Amscan Holdings, Inc.

B1

B+

1,496,250

Term Loan, 8.300%-10.250%, maturing December 23, 2012

1,504,355

Bushnell Performance Optics, Inc.

B1

B+

1,737,195

Term Loan, 8.450%, maturing August 19, 2011

1,749,500

Central Garden & Pet Company

Ba2

BB

1,295,500

Term Loan, 6.830%-6.910%, maturing September 30, 2012

1,296,310

Fender Musical Instruments Corporation

B2

B+

1,973,054

Term Loan, 7.870%, maturing March 30, 2012

1,985,386

Fender Musical Instruments Corporation

Caa1

B-

2,500,000

Term Loan, 11.120%, maturing September 30, 2012

2,537,500

Hunter Fan Company

B1

B

866,667

Term Loan, 7.760%, maturing March 24, 2012

865,583

Jarden Corporation

B1

B+

10,196,260

Term Loan, 7.499%, maturing January 24, 2012

10,181,393

2,021,657

Term Loan, 7.249%, maturing January 24, 2012

2,018,709

Mega Bloks, Inc.

Ba3

BB-

990,000

Term Loan, 7.125%-7.250%, maturing July 27, 2010

990,000

Natural Products Group

B1

B

1,500,000

Term Loan, 8.330%-8.400%, maturing June 19, 2013

1,505,625

Norwood Promotional Products Holdings, Inc.

NR

NR

2,312,500

Revolver, 8.375%-9.500%, maturing December 31, 2008

2,324,063

600,000

Term Loan, 9.563%, maturing February 15, 2008

576,000

7,910,564

(3

)

Term Loan, maturing August 17, 2011

3,006,014

Norwood Promotional Products, Inc.

NR

NR

4,093,158

Term Loan, 11.563%, maturing August 17, 2009

4,175,021

Oreck Corporation

B1

B+

903,707

Term Loan, 8.250%, maturing January 27, 2012

905,402

 

See Accompanying Notes to Financial Statements

46

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

Bank Loan Ratings†

Principal Amount

Borrower/Tranche Description

Moody's

S&P

Value

Personal & Nondurable Consumer Products: (continued)

Prestige Brands Holdings, Inc.

B1

B+

$

4,082

Term Loan, 7.710%-9.500%,

maturing April 06, 2011

$

4,102

Reddy Ice Group, Inc.

B1

B+

1,000,000

Term Loan, 7.250%, maturing August 09, 2012

1,000,625

Spectrum Brands, Inc.

B2

B-

8,249,739

Term Loan, 8.080%-8.510%, maturing February 06, 2012

8,265,207

Tupperware Corporation

Ba2

BB

7,685,252

Term Loan, 6.810%, maturing December 05, 2012

7,647,625

55,613,919

Personal, Food & Miscellaneous: 4.2%

Acosta, Inc.

B1

B-

3,000,000

Term Loan, 8.160%, maturing July 28, 2013

3,031,875

AFC Enterprises, Inc.

B1

B+

1,152,508

Term Loan, 7.750%, maturing May 11, 2011

1,156,110

Alderwoods Group, Inc.

Ba3

BB

1,494,158

Term Loan, 7.320%-7.324%, maturing September 29, 2009

1,496,649

Allied Security Holdings, LLC

Ba3

B

500,000

Term Loan, 8.450%, maturing June 30, 2010

504,375

Arby's Restaurant Group, Inc.

B1

B+

5,504,516

Term Loan, 7.735%-7.749%, maturing July 25, 2012

5,513,120

Bare Escentuals Beauty, Inc.

B1

B-

3,330,628

Term Loan, 8.190%-10.000%, maturing February 18, 2012

3,341,036

Bare Escentuals Beauty, Inc.

B3

CCC

2,000,000

Term Loan, 12.330%, maturing February 18, 2013

2,015,000

Brickman Group Holdings, Inc.

Ba3

BB-

1,418,182

Term Loan, 6.527%-6.690%, maturing December 19, 2008

1,414,636

Burger King Corporation

Ba2

B+

2,802,034

Term Loan, 7.000%, maturing June 30, 2012

2,799,187

Burt's Bees, Inc.

B2

B

1,219,375

Term Loan, 7.919%-8.368%, maturing March 24, 2011

1,219,375

Carrols Corporation

B1

B+

3,040,812

Term Loan, 8.000%, maturing December 31, 2010

3,057,917

 

See Accompanying Notes to Financial Statements

47

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

Bank Loan Ratings†

Principal Amount

Borrower/Tranche Description

Moody's

S&P

Value

Personal, Food & Miscellaneous: (continued)

CBRL Group, Inc.

Ba2

BB

$

2,061,882

Term Loan, 6.930%-6.970%,

maturing April 27, 2013

$

2,052,604

Coinmach Corporation

B2

B

5,988,399

Term Loan, 7.875%-7.938%, maturing December 19, 2012

6,035,186

Coinstar, Inc.

Ba3

BB-

2,442,287

Term Loan, 7.510%, maturing July 07, 2011

2,459,078

Culligan International Company

B1

B+

2,009,884

Term Loan, 7.330%, maturing September 30, 2011

2,013,025

Dave and Busters, Inc.

B1

B-

250,000

Term Loan, 7.938%, maturing March 08, 2013

250,313

249,375

Term Loan, 8.000%, maturing March 08, 2013

249,687

Jack in the Box, Inc.

Ba2

BB

2,650,152

Term Loan, 6.610%-7.010%, maturing January 08, 2011

2,663,403

(5

)

N.E.W. Customer Services Companies, Inc.

B1

B+

2,000,000

Term Loan, maturing August 18, 2013

2,015,000

Quiznos, LLC

B2

B

2,066,667

Term Loan, 7.750%, maturing May 05, 2013

2,064,298

U.S Security Holdings, Inc.

B1

B

623,438

Term Loan, 7.770%-7.860%, maturing April 30, 2011

625,775

45,977,649

Printing & Publishing: 8.7%

Adams Outdoor Advertising, L.P.

B1

B+

4,410,034

Term Loan, 7.150%-8.750%, maturing October 18, 2012

4,422,440

American Achievement Corporation

Ba3

B+

685,407

Term Loan, 7.896%-9.500%, maturing March 25, 2011

690,547

American Media Operations, Inc.

B1

B

6,350,000

Term Loan, 8.120%, maturing January 31, 2013

6,396,831

American Reprographics Company

Ba3

BB

2,299,379

Term Loan, 7.150%-9.000%, maturing June 18, 2009

2,302,973

Ascend Media Holdings, LLC

B3

B

1,706,250

Term Loan, 8.620%-9.000%, maturing January 31, 2012

1,661,461

Black Press

Ba3

B+

1,244,444

Term Loan, 7.500%, maturing August 02, 2013

1,252,222

 

See Accompanying Notes to Financial Statements

48

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

Bank Loan Ratings†

Principal Amount

Borrower/Tranche Description

Moody's

S&P

Value

Printing & Publishing: (continued)

$

755,556

Term Loan, 7.467%-7.500%,

maturing August 02, 2013

$

760,278

Caribe Information Investment, Inc.

B1

B

1,995,000

Term Loan, 7.460%-7.660%, maturing March 31, 2013

1,997,494

Cenveo Corporation

Ba3

BB-

1,500,000

Term Loan, 7.440%, maturing June 21, 2013

1,502,813

Dex Media East, LLC

Ba2

BB

3,303,714

Term Loan, 6.800%-7.000%, maturing May 08, 2009

3,297,292

Dex Media West, LLC

Ba2

BB

1,022,280

Term Loan, 6.580%-6.750%, maturing September 09, 2009

1,015,411

13,250,141

Term Loan, 6.800%-7.000%, maturing March 09, 2010

13,210,391

FM Mergerco, Inc.

B1

B

2,333,333

Term Loan, 7.580%-7.750%, maturing June 12, 2012

2,346,458

FSC Acquisition, LLC

B2

B

291,214

Term Loan, 7.670%, maturing August 01, 2012

291,032

2,438,121

Term Loan, 7.620%-7.739%, maturing August 01, 2012

2,436,597

Gatehouse Media Operating, Inc.

B1

BB-

2,250,000

Term Loan, 7.660%, maturing December 06, 2013

2,254,219

IWCO Direct, Inc.

B1

B

1,481,253

Term Loan, 8.749%, maturing January 31, 2011

1,484,956

MC Communications, LLC

B2

B

3,198,906

Term Loan, 7.970%, maturing December 31, 2010

3,216,899

Medianews Group, Inc.

Ba3

BB-

1,000,000

Term Loan, 7.156%, maturing June 27, 2013

1,002,500

Merrill Communications, LLC

B1

B+

2,945,976

Term Loan, 7.580%-7.749%, maturing May 15, 2011

2,961,628

Newspaper Holdings, Inc.

NR

NR

1,666,667

Term Loan, 6.938%, maturing August 24, 2012

1,667,708

Primedia, Inc.

B2

B

420,012

Revolver, 7.875%-7.938%, maturing June 30, 2008

406,537

6,435,000

Term Loan, 7.650%, maturing September 30, 2013

6,357,780

 

See Accompanying Notes to Financial Statements

49

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

Bank Loan Ratings†

Principal Amount

Borrower/Tranche Description

Moody's

S&P

Value

Printing & Publishing: (continued)

Prism Business Media, Inc.

B2

B

$

1,985,003

Term Loan, 7.735%-7.749%,

maturing September 30, 2012

$

1,988,312

R.H. Donnelley, Inc.

Ba3

BB

389,832

Term Loan, 6.580%-6.760%, maturing December 31, 2009

386,456

9,632,322

Term Loan, 6.740%-7.010%, maturing June 30, 2011

9,580,394

Source Media, Inc.

B1

B

3,077,206

Term Loan, 7.610%, maturing November 08, 2011

3,090,669

Triple Crown Media, Inc.

B2

B

1,479,713

Term Loan, 8.520%-10.500%, maturing June 30, 2010

1,479,713

Visant Holding Corporation

B1

B+

9,306,264

Term Loan, 7.068%, maturing October 04, 2011

9,359,775

(5

)

Yell Group, Ltd.

Ba3

BB

2,000,000

Term Loan, maturing January 31, 2013

2,014,600

EUR

2,000,000

Term Loan, maturing January 31, 2013

2,587,330

Ziff Davis Media, Inc.

B3

CCC

$

1,500,000

Floating Rate Note, 11.489%

maturing May 01, 2012

1,453,125

94,876,841

Radio and TV Broadcasting: 4.0%

Block Communications, Inc.

Ba2

BB-

995,000

Term Loan, 7.499%, maturing December 22, 2011

998,109

CMP KC, LLC

Caa1

CCC+

1,400,000

Term Loan, 9.250%-9.313%, maturing May 03, 2011

1,401,750

CMP Susquehanna Corporation

B1

B-

5,088,571

Term Loan, 7.250%-7.375%, maturing May 05, 2013

5,087,778

Cumulus Media, Inc.

Ba3

B

3,000,000

Term Loan, 7.329%-7.626%, maturing June 07, 2013

3,011,484

Emmis Operating Company

Ba2

B+

1,450,270

Term Loan, 7.080%, maturing November 10, 2011

1,454,009

Entravision Communications Corporation

Ba3

B+

2,977,500

Term Loan, 7.010%, maturing March 29, 2013

2,980,293

Gray Television, Inc.

Ba2

BB-

497,500

Term Loan, 7.000%, maturing June 15, 2011

497,811

995,000

Term Loan, 7.010%, maturing November 22, 2012

995,622

 

See Accompanying Notes to Financial Statements

50

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

Bank Loan Ratings†

Principal Amount

Borrower/Tranche Description

Moody's

S&P

Value

Radio and TV Broadcasting: (continued)

Mission Broadcasting, Inc.

Ba3

B

$

2,414,151

Term Loan, 7.249%,

maturing August 14, 2012

$

2,409,123

Montecito Broadcast Group, LLC

B1

B

1,990,000

Term Loan, 7.723%, maturing January 27, 2013

1,999,950

NEP Supershooters, L.P.

B1

B

2,402,217

Term Loan, 9.470%-9.500%, maturing February 03, 2011

2,429,241

958,037

Term Loan, 9.000%, maturing February 03, 2011

970,012

Nexstar Broadcasting, Inc.

Ba3

B

2,344,810

Term Loan, 7.250%, maturing August 14, 2012

2,339,926

Paxson Communications Corporation

B2

CCC+

4,500,000

Term Loan, 8.757%, maturing January 15, 2012

4,573,125

Raycom TV Broadcasting, LLC

NR

NR

3,353,268

Term Loan, 7.000%, maturing July 31, 2013

3,338,598

Spanish Broadcasting Systems, Inc.

B1

B+

3,950,000

Term Loan, 7.250%, maturing June 10, 2012

3,952,469

Young Broadcasting, Inc.

B2

B-

4,950,000

Term Loan, 7.938%-8.000%, maturing November 03, 2012

4,929,116

43,368,416

Retail Stores: 6.5%

Advance Stores Company, Inc.

Ba1

BB+

1,617,957

Term Loan, 6.906%-7.000%, maturing September 30, 2010

1,619,979

1,963,033

Term Loan, 6.750%-6.938%, maturing September 30, 2010

1,965,487

Blockbuster Entertainment Corporation

B3

B-

997,475

Term Loan, 8.550%-9.070%, maturing August 20, 2011

1,000,309

Burlington Coat Factory Warehouse Corporation

B2

B

5,472,500

Term Loan, 7.530%, maturing May 28, 2013

5,325,853

Dollarama Group, L.P.

B1

B+

3,447,609

Term Loan, 7.485%, maturing November 18, 2011

3,465,926

Harbor Freight Tools, Inc.

B1

B+

7,232,612

Term Loan, 7.131%-7.276%, maturing July 15, 2010

7,238,941

Jean Coutu Group, Inc.

B2

BB-

5,005,019

Term Loan, 8.000%, maturing July 30, 2011

5,022,747

 

See Accompanying Notes to Financial Statements

51

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

Bank Loan Ratings†

Principal Amount

Borrower/Tranche Description

Moody's

S&P

Value

Retail Stores: (continued)

Mapco Express, Inc.

B2

B+

$

2,239,897

Term Loan, 8.200%,

maturing April 28, 2011

$

2,258,096

Movie Gallery, Inc.

Caa1

CCC+

687,411

Term Loan, 10.750%, maturing April 27, 2011

651,752

Nebraska Book Company, Inc.

B2

B-

2,443,750

Term Loan, 7.740%, maturing March 04, 2011

2,454,441

Neiman-Marcus Group, Inc.

B1

B+

18,037,975

Term Loan, 7.770%, maturing April 06, 2013

18,204,068

Oriental Trading Company, Inc.

B3

B

2,500,000

Term Loan, 8.150%, maturing July 31, 2013

2,503,645

Pantry, Inc.

Ba3

BB

2,487,500

Term Loan, 7.080%, maturing January 02, 2012

2,495,273

Pep Boys-Manny, Moe & Jack

Ba2

B+

497,500

Term Loan, 8.330%, maturing January 27, 2011

503,097

Sears Canada, Inc.

Ba1

BB+

2,242,500

Term Loan, 7.249%, maturing December 22, 2012

2,246,705

Sports Authority, Inc

B2

B

1,000,000

Term Loan, 7.749%, maturing May 03, 2013

999,375

Tire Rack, Inc.

B1

BB-

905,660

Term Loan, 7.140%-7.250%, maturing June 24, 2012

900,566

Toys R Us, Inc.

B1

B

2,375,000

Term Loan, 9.643%, maturing July 19, 2006

2,425,098

Travelcenters of America, Inc.

B1

BB

9,950,000

Term Loan, 6.860%-7.250%, maturing December 01, 2011

9,956,219

71,237,577

Satellite: 0.5%

Panamsat Corporation

B1

BB

5,000,000

Term Loan, 8.008%, maturing October 01, 2006

5,039,065

5,039,065

Telecommunications Equipment: 1.0%

Crown Castle Operating Company

B2

BB

3,500,000

Term Loan, 7.650%, maturing June 01, 2014

3,523,335

 

See Accompanying Notes to Financial Statements

52

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

Bank Loan Ratings†

Principal Amount

Borrower/Tranche Description

Moody's

S&P

Value

Telecommunications Equipment: (continued)

Sorenson Communications, Inc.

Ba3

B

$

5,250,000

Term Loan, 8.330%,

maturing August 31, 2013

$

5,271,877

Sorenson Communications, Inc.

Caa1

CCC+

750,000

Term Loan, 12.330%, maturing February 28, 2014

757,500

Syniverse Holding, LLC

Ba3

BB-

1,589,971

Term Loan, 7.500%, maturing February 15, 2012

1,589,971

11,142,683

Textiles & Leather: 1.8%

(5

)

Hanesbrands, Inc.

Ba2

BB-

2,500,000

Term Loan, maturing September 05, 2013

2,522,990

(5

)

Hanesbrands, Inc.

Ba3

B-

1,000,000

Term Loan, maturing March 05, 2014

1,019,219

Polymer Group, Inc.

B1

BB-

7,462,500

Term Loan, 7.740%, maturing November 22, 2012

7,485,820

Propex Fabrics, Inc.

B1

BB-

943,822

Term Loan, 7.760%, maturing July 31, 2012

945,002

St. John Knits International, Inc.

B1

B+

869,350

Term Loan, 9.500%, maturing March 18, 2012

867,720

Targus Group International

B1

B

1,479,688

Term Loan, 8.297%-8.344%, maturing November 22, 2012

1,475,372

Targus Group International

B3

CCC+

875,000

Term Loan, 12.800%, maturing May 22, 2013

842,188

Warnaco, Inc.

Ba2

BB

997,500

Term Loan, 6.900%-8.750%, maturing January 31, 2013

990,019

William Carter Company

B1

BB

3,151,148

Term Loan, 6.758%-6.985%, maturing July 14, 2012

3,149,179

19,297,509

Utilities: 7.9%

Astoria Generating Company Acquisitions, LLC

B1

BB-

923,858

Term Loan, 7.450%, maturing February 23, 2011

928,230

2,262,215

Term Loan, 7.450%, maturing February 23, 2013

2,272,920

Babcock & Wilcox Company

B1

B+

2,500,000

Term Loan, 5.399%, maturing January 22, 2012

2,525,000

 

See Accompanying Notes to Financial Statements

53

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

Bank Loan Ratings†

Principal Amount

Borrower/Tranche Description

Moody's

S&P

Value

Utilities: (continued)

Coleto Creek WLE, L.P.

B1

B+

$

764,331

Term Loan, 8.260%,

maturing July 28, 2013

$

760,510

5,360,669

Term Loan, 8.195%, maturing June 28, 2013

5,333,865

Infrastrux Group, Inc.

B1

B+

498,750

Term Loan, 8.375%, maturing May 08, 2012

498,750

KGen, LLC

B2

B

4,937,500

Term Loan, 8.124%, maturing August 01, 2011

4,956,016

La Paloma Generating Company

Ba3

BB-

218,579

Term Loan, 7.080%, maturing August 16, 2012

218,306

1,348,115

Term Loan, 7.249%, maturing August 16, 2012

1,346,430

107,368

Term Loan, 7.249%, maturing August 16, 2012

107,234

La Paloma Generating Company

B2

B

1,000,000

Term Loan, 8.999%, maturing August 16, 2013

1,002,917

LSP Gen Finance Co. LLC

Ba3

BB-

4,444,444

Term Loan, 7.249%, maturing May 04, 2013

4,437,036

LSP-Kendall Energy, LLC

B1

B

9,755,318

Term Loan, 7.499%, maturing October 07, 2013

9,688,250

NRG Energy, Inc.

Ba2

BB-

6,000,000

Term Loan, 7.499%, maturing February 01, 2013

6,024,750

24,513,831

Term Loan, 7.330%, maturing February 01, 2013

24,635,125

Pike Electric, Inc.

Ba3

BB

1,332,353

Term Loan, 6.938%, maturing July 01, 2012

1,331,937

901,405

Term Loan, 6.875%, maturing December 10, 2012

901,124

Plum Point Energy Associates, LLC

B1

B

1,198,857

Term Loan, 9.124%, maturing March 14, 2014

1,206,850

3,021,069

Term Loan, 8.749%, maturing March 14, 2014

3,041,211

Primary Energy Finance, LLC

Ba2

BB-

2,385,353

Term Loan, 7.330%, maturing August 24, 2012

2,395,789

Riverside Energy Center, LLC

B1

B

244,856

Term Loan, 9.735%, maturing June 24, 2010

251,589

 

See Accompanying Notes to Financial Statements

54

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

												Bank Loan Ratings†
Principal Amount								Borrower/Tranche Description				Moody's				S&P				Value
Utilities: (continued)
$	3,063,822							Term Loan, 9.735%,
								maturing June 24, 2011												$	3,148,077
	2,116,749							Term Loan, 9.735%, maturing June 24, 2011													2,174,959
								Thermal North America, Inc.				Ba3				BB-
	1,000,000							Term Loan, 7.160%, maturing October 12, 2013													997,500
	1,369,433							Term Loan, 7.250%, maturing October 12, 2013													1,367,721
								Wolf Hollow I, LP				B1				BB-
	1,800,000							Term Loan, 7.576%, maturing June 22, 2012													1,809,000
	450,000							Term Loan, 7.576%, maturing June 22, 2012													455,625
	2,185,217							Term Loan, 7.749%, maturing June 22, 2012													2,196,143
																					86,012,864
								Total Senior Loans (Cost $1,953,939,674)													1,957,495,444
Other Corporate Debt: 0.6%
Automobile
								Avis Budget Car Rental, LLC				Ba3				BB-
	750,000							Floating Rate Note, 7.905%, maturing May 15, 2014													733,125
								Navistar International Corporation				NR				BB-
	5,200,000							Unsecured Term Loan, 10.460%-10.489%, maturing February 22, 2009													5,226,000
								Total Other Corporate Debt (Cost $5,928,190)													5,959,125
Equities and Other Assets: 1.6%

 

				Description				Value
(1), (@), (R)				Allied Digital Technologies Corporation (Residual Interest in Bankruptcy Estate)					107,510
(2), (@), (R)				AM Cosmetics Corporation (Liquidation Interest)					25
(@), (R)				Block Vision Holdings Corporation (571 Common Shares)					—
(2), (@), (R)				Boston Chicken, Inc. (Residual Interest in Boston Chicken Plan Trust)					—
(2), (@), (R)				Cedar Chemical (Liquidation Interest)					—
(@), (R)				Covenant Care, Inc. (Warrants for 19,000 Common Shares, Expires January 13, 2005)					—
(@), (R)				Covenant Care, Inc. (Warrants for 26,901 Common Shares, Expires March 31, 2013)					—

 

See Accompanying Notes to Financial Statements

55

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

				Description				Value
(@), (R)				Decision One Corporation (1,402,038 Common Shares)				$	145,812
(2), (@), (R)				Electro Mechanical Solutions (Residual Interest in Bankruptcy Estate)					1,112
(2), (@), (R)				Enterprise Profit Solutions (Liquidation Interest)					56,559
(@), (R)				EquityCo, LLC (Warrants for 28,782 Common Shares)					—
(4), (@), (R)				Euro United Corporation (Residual Interest in Bankruptcy Estate)					305,999
(@), (R)				Gemini Leasing, Inc. (143,079 common shares)					—
(2), (@), (R)				Grand Union Company (Residual Interest in Bankruptcy Estate)					54,523
(@)				Hayes Lemmerz International, Inc. (73,835 Common Shares)					125,520
(@)				Hayes Lemmerz International, Inc. (246 Preferred Shares)					—
(2), (@), (R)				Humphreys, Inc. (Residual Interest in Bankruptcy Estate)					—
(2), (@), (R)				Imperial Home Décor Group, Inc. (Liquidation Interest)					—
(2), (@), (R)				Insilco Technologies (Residual Interest in Bankruptcy Estate)					—
(2), (@), (R)				IT Group, Inc. (Residual Interest in Bankruptcy Estate)					100
(2), (@), (R)				Kevco, Inc. (Residual Interest in Bankruptcy Estate)					50
(2), (@), (R)				Lincoln Pulp and Eastern Fine (Residual Interest in Bankruptcy Estate)					—
(@), (R)				Lincoln Paper & Tissue (Warrants for 291 Common Shares, Expires August 24, 2015)					—
(@), (R)				London Clubs International (Warrants for 241,499 Common Shares, Expires February 27, 2011)					517,535
(@), (R)				Neoplan USA Corporation (17,348 Common Shares)					—
(@), (R)				Neoplan USA Corporation (1,814,180 Series B Preferred Shares)					—
(@), (R)				Neoplan USA Corporation (1,084,000 Series C Preferred Shares)					—
(@), (R)				Neoplan USA Corporation (3,524,300 Series D Preferred Shares)					—
(2), (@), (R)				New Piper Aircraft, Inc. (Residual Interest in Litigation Proceeds)					—
(@), (R)				New World Restaurant Group, Inc. (10,205 Common Shares)					117,358
(@), (R)				Norwood Promotional Products, Inc. (72,238 Common Shares)					—
(@), (R)				Safelite Glass Corporation (810,050 Common Shares)					16,064,938
(@), (R)				Safelite Realty Corporation (54,679 Common Shares)					317,922
(1), (@), (R)				Transtar Metals (Residual Interest in Bankruptcy Estate)					—
(1), (@), (R)				TSR Wireless, LLC (Residual Interest in Bankruptcy Estate)					—

 

See Accompanying Notes to Financial Statements

56

---

ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

				Description				Value
(2), (@), (R)					U.S. Aggregates (Residual Interest in Bankruptcy Estate)			$	—
(2), (@), (R)					U.S. Office Products Company (Residual Interest in Bankruptcy Estate)				—
(@)					USA Mobility
Total for Equities and Other Assets  (Cost $6,558,856)									17,814,963
Total Investments  (Cost $1,966,426,720)**					181.8	%			1,981,269,532
Other Assets and Liabilities - Net					(81.8	)			(891,463,202	)
Net Assets					100.0	%			1,089,806,330

 

  *  Senior loans, while exempt from registration under the Securities Act of 1933, as amended, contain certain restrictions on resale and cannot be sold publicly. These senior loans bear interest (unless otherwise noted) at rates that float periodically at a margin above the London Inter-Bank Offered Rate ("LIBOR") and other short-Term rates.

  †  Bank Loans rated below Baa by considered to be below investment grade.

  NR  Not Rated

  (1)  The borrower filed for protection under Chapter 7 of the U.S. Federal bankruptcy code.

  (2)  The borrower filed for protection under Chapter 11 of the U.S. Federal Bankruptcy code.

  (3)  Loan is on non-accrual basis.

  (4)  The borrower filed for protection under the Canadian Bankruptcy and Insolvency Act.

  (5)  Trade pending settlement. Contract rates do not take effect until settlement date.

  (@)  Non-income producing security.

  (R)  Restricted security.

  **  For Federal Income Tax purposes cost of investments is $1,966,544,710.

    Net unrealized appreciation consists of the following:

Gross Unrealized Appreciation				$	19,352,035
Gross Unrealized Depreciation					(4,627,213	)
Net Unrealized Appreciation				$	14,724,822

 

See Accompanying Notes to Financial Statements

57

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ING Prime Rate Trust

PORTFOLIO OF INVESTMENTS as of August 31, 2006 (Unaudited) (continued)

At August 31, 2006 the following forward foreign currency contracts were outstanding for ING Prime Rate Trust:

Currency				Buy/Sell				Settlement Date				In Exchange For				Value				Unrealized Appreciation/ (Depreciation)
Euro EUR 3,510,000				Sell				09/15/06					USD $4,496,125			$	4,501,877			$	(5,752	)
Euro EUR 900,000				Sell				09/15/06					1,147,329				1,153,261				(5,932	)
Euro EUR 5,880,000				Sell				10/13/06					7,544,392				7,554,297				(9,905	)
Euro EUR 4,410,000				Sell				11/15/06					5,662,476				5,676,199				(13,723	)
British Pound GBP 1,806,000				Sell				09/15/06					3,344,441				3,440,977				(96,536	)
British Pound GBP 2,408,000				Sell				10/13/06					4,462,000				4,589,776				(127,776	)
British Pound GBP 1,806,000				Sell				11/15/06					3,348,776				3,443,791				(95,015	)
												$	30,005,539			$	30,360,178			$	(354,639	)

 

See Accompanying Notes to Financial Statements

58

---

ING Prime Rate Trust

JUNE 14, 2006 ANNUAL SHAREHOLDER MEETING

ING Prime Rate Trust, Common Shares

1.  To elect ten members of the Board to represent the interests of the holders of Common Shares of the Trust until the election and qualification of their successors.

ING Prime Rate Trust, Preferred Shares

2.  To elect two members of the Board to represent the interests of the holders of Auction Rate Cumulative Preferred Shares – Series M, T, W, TH and F of the Trust – until the election and qualification of their successors.

				Proposal				Shares voted for				Shares voted against or withheld				Shares abstained				Total Shares Voted
Common Shares Trustees				John V. Boyer Patricia W. Chadwick J. Michael Earley R. Barbara Gitenstein Patrick W. Kenny Shaun P. Mathews Walter H. May Sheryl K. Pressler David W.C. Putnam John G. Turner				118,004,490.617 117,993,956.934 118,051,382.617 118,004,758.423 118,048,201.617 117,987,794.617 117,990,924.450 117,826,278.785 118,010,279.255 118,038,404.617				1,680,411.292 1,690,944.975 1,633,519.292 1,680,143.486 1,636,700.292 1,697,107.292 1,693,977.459 1,858,623.124 1,674,622.654 1,646, 497.292				— — — — — — — — — —					119,684,901.909 119,684,901.909 119,684,901.909 119,684,901.909 119,684,901.909 119,684,901.909 119,684,901.909 119,684,901.909 119,684,901.909 119,684,901.909
Preferred   Shares Trustees				Jock Patton Roger B. Vincent				16,781.000 16,783.000				55.000 53.000				— —					16,836.000 16,836.000

 

59

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ING Prime Rate Trust

ADDITIONAL INFORMATION (Unaudited)

SHAREHOLDER INVESTMENT PROGRAM

The Trust offers a Shareholder Investment Program (the "Program") which allows holders of the Trust's common shares a simple way to reinvest dividends and capital gains distributions, if any, in additional common shares of the Trust. The Program also offers holders of the Trust's common shares the ability to make optional cash investments in any amount from $100 to $100,000 on a monthly basis.

For dividend and capital gains distribution reinvestment purposes, DST will purchase shares of the Trust on the open market when the market price plus estimated fees is less than the NAV on the valuation date. The Trust will issue new shares for dividend and capital gains distribution reinvestment purchases when the market price plus estimated fees is equal to or exceeds the net asset value on the valuation date. New shares may be issued at the greater of (i) NAV or (ii) the market price of the shares during the pricing period, minus a discount of 5%.

For optional cash investments, shares will be purchased on the open market by the DST when the market price plus estimated fees is less than the NAV on the valuation date. New shares will be issued by the Trust for optional cash investments when the market price plus estimated fees is equal to or exceeds the net asset value on the valuation date. Such shares will be issued at a discount to market, determined by the Trust, between 0% and 5%.

There is no charge to participate in the Program. Participants may elect to discontinue participation in the Program at any time. Participants will share, on a pro rata basis, in the fees or expenses of any shares acquired in the open market.

Participation in the Program is not automatic. If you would like to receive more information about the Program or if you desire to participate, please contact your broker or the Trust's Shareholder Services Department at 1-(800) 992-0180.

KEY FINANCIAL DATES — CALENDAR 2006 DIVIDENDS:

DECLARATION DATE				EX-DIVIDEND DATE				PAYABLE DATE
January 31				February 8				February 23
February 28				March 8				March 22
March 31				April 6				April 24
April 28				May 8				May 22
May 31				June 8				June 22
June 30				July 6				July 24
July 31				August 8				August 22
August 31				September 7				September 22
September 29				October 6				October 23
October 31				November 8				November 22
November 30				December 7				December 22
December 20				December 27				January 12

 

Record date will be two business days after each Ex-Dividend Date. These dates are subject to change.

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ING Prime Rate Trust

ADDITIONAL INFORMATION (Unaudited) (continued)

STOCK DATA

The Trust's common shares are traded on the New York Stock Exchange (Symbol: PPR). Effective March 1, 2002, the Trust's name changed to ING Prime Rate Trust and its CUSIP number changed to 44977W106. The Trust's NAV and market price are published daily under the "Closed-End Funds" feature in Barron's, The New York Times, The Wall Street Journal and many other regional and national publications.

REPURCHASE OF SECURITIES BY CLOSED-END COMPANIES

In accordance with Section 23(c) of the 1940 Act, and Rule 23c-1 under the 1940 Act the Trust may from time to time purchase shares of beneficial interest of the Trust in the open market, in privately negotiated transactions and/or purchase shares to correct erroneous transactions.

NUMBER OF SHAREHOLDERS

The approximate number of record holders of Common Stock as of August 31, 2006 was 5,663 which does not include approximately 44,080 beneficial owners of shares held in the name of brokers of other nominees.

PROXY VOTING INFORMATION

A description of the policies and procedures that the Trust uses to determine how to vote proxies related to portfolio securities is available (1) without charge, upon request, by calling Shareholder Services toll-free at 1-800-992-0180; (2) on the Trust's website at www.ingfunds.com and (3) on the SEC's website at www.sec.gov. Information regarding how the Trust voted proxies related to portfolio securities during the most recent 12-month period ended June 30 is available without charge on the Trust's website at www.ingfunds.com and on the SEC website at www.sec.gov.

QUARTERLY PORTFOLIO HOLDINGS

The Trust files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The Trust's Forms N-Q are available on the SEC's website at www.sec.gov. The Trust's Forms N-Q may be reviewed and copied at the SEC's Public Reference Room in Washington, DC, and information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330; and is available upon request from the Trust by calling Shareholder Services toll-free at 1-800-992-0180.

CERTIFICATIONS

In accordance with Section 303A.12 (a) of the New York Stock Exchange Listed Company Manual, the Trust submitted the Annual CEO Certification on June 19, 2006 certifying that he was not aware, as of that date, of any violation by the Trust of the NYSE's Corporate governance listing standards. In addition, as required by Section 203 of the Sarbanes-Oxley Act of 2002 and related SEC rules, the Trust's principal executive and financial officers have made quarterly certifications, included in filings with the SEC on Forms N-CSR and N-Q, relating to, among other things, the Trust's disclosure controls and procedures and internal controls over financial reporting.

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Investment Adviser

ING Investments, LLC

7337 East Doubletree Ranch Road

Scottsdale, Arizona 85258

Sub-Adviser

ING Investment Management Co.

230 Park Avenue

New York, NY 10169

Institutional Investors and Analysts

Call ING Prime Rate Trust

1-800-336-3436, Extension 2217

Administrator

ING Funds Services, LLC

7337 East Doubletree Ranch Road

Scottsdale, Arizona 85258

1-800-992-0180

Written Requests

Please mail all account inquiries and other comments to:

ING Prime Rate Trust Account

c/o ING Fund Services, LLC

7337 East Doubletree Ranch Road

Scottsdale, Arizona 85258

Distributor

ING Funds Distributor, LLC

7337 East Doubletree Ranch Road

Scottsdale, Arizona 85258

1-800-334-3444

Transfer Agent

DST Systems, Inc.

P.O. Box 219368

Kansas City, Missouri 64141

Custodian

State Street Bank and Trust Company

801 Pennsylvania Avenue

Kansas City, Missouri 64105

Legal Counsel

Dechert LLP

1775 I Street, N.W.

Washington, D.C. 20006

Toll-Free Shareholder Information

Call us from 9:00 a.m. to 7:00 p.m. Eastern time on any business day for account or other information, at (800)-992-0180

For more complete information, or to obtain a prospectus on any ING fund, please call your Investment Professional or ING Funds Distributor, LLC at (800) 992-0180 or log on to www.ingfunds.com. The prospectus should be read carefully before investing. Consider the Trust's investment objectives, risks, charges and expenses carefully before investing. The prospectus contains this information and other information about the Trust.

PRSAR-UPRT     (0806-102806)

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