UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-Q
QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED MANAGEMENT
INVESTMENT COMPANY
Investment Company Act file number 811-6501
Name of Fund: MuniYield Michigan Insured Fund II, Inc.
Fund Address: P.O. Box 9011
Princeton, NJ 08543-9011
Name and address of agent for service: Terry K. Glenn, President,
MuniYield Michigan Insured Fund II, Inc., 800 Scudders Mill
Road, Plainsboro, NJ, 08536. Mailing address: P.O. Box 9011,
Princeton, NJ, 08543-9011
Registrant's telephone number, including area code: (609) 282-2800
Date of fiscal year end: 10/31/04
Date of reporting period: 05/01/04 - 07/31/04
Item 1 - Schedule of Investments
MuniYield Michigan Insured Fund II, Inc.
Schedule of Investments as of July 31, 2004 (in Thousands)
S&P Moody's Face
Ratings Ratings Amount Municipal Bonds Value
Michigan - 141.4%
AAA Aaa $ 2,400 Adrian, Michigan, City School District, GO, 5% due 5/01/2034(d) $ 2,395
Anchor Bay, Michigan, School District, GO (School Building and Site)(c)(f):
AAA Aaa 4,250 Series I, 6% due 5/01/2009 4,817
AAA Aaa 3,165 Series II, 5.75% due 5/01/2010 3,585
AAA Aaa 4,775 Birmingham, Michigan, City School District, School Building and Site, GO
5% due 11/01/2033(d) 4,767
AA+ Aa1 2,150 Bullock Creek, Michigan, School District, GO, 5.50% due 5/01/2026(e) 2,263
AAA Aaa 2,175 Carman-Ainsworth, Michigan, Community School, GO, 5.50% due 5/01/2018(c) 2,391
AAA Aaa 1,000 Central Montcalm, Michigan, Public Schools, GO, 5.75% due 5/01/2024(e) 1,091
AAA Aaa 3,850 Charlotte, Michigan, Public School District, GO, 5.375% due 5/01/2029(c) 3,948
AAA Aaa 1,500 Comstock Park, Michigan, Public Schools, GO, 5.75% due 5/01/2029(c) 1,610
BBB Baa2 2,420 Delta County, Michigan, Economic Development Corporation, Environmental
Improvement Revenue Refunding Bonds (Mead Westvaco-Escanaba), Series A,
6.25% due 4/15/2027 2,512
Detroit, Michigan, City School District, School Building and Site Improvement,
GO, Series A(c):
AAA Aaa 1,480 5.375% due 5/01/2024 1,560
AAA Aaa 2,000 5% due 5/01/2032 1,995
Detroit, Michigan, Water Supply System Revenue Bonds,:
AAA NR* 1,000 DRIVERS, Series 200, 10.127% due 7/01/2028(c)(h) 1,296
AAA Aaa 4,600 Senior Lien, Series A, 5% due 7/01/2034(e) 4,554
AAA Aaa 1,300 Series B, 5.25% due 7/01/2032(e) 1,329
AAA Aaa 4,400 Series B, 5% due 7/01/2034(e) 4,356
BBB Baa2 2,500 Dickinson County, Michigan, Economic Development Corporation, Environmental
Improvement Revenue Refunding Bonds (International Paper Company Project),
Series A, 5.75% due 6/01/2016 2,600
Portfolio Abbreviations
To simplify the listings of MuniYield Michigan Insured Fund II,
Inc.'s portfolio holdings in the Schedule of Investments, we have
abbreviated the names of many of the securities according to the
list below.
AMT Alternative Minimum Tax (subject to)
COP Certificates of Participation
DRIVERS Derivative Inverse Tax-Exempt Receipts
GO General Obligation Bonds
HDA Housing Development Authority
PCR Pollution Control Revenue Bonds
RIB Residual Interest Bonds
MuniYield Michigan Insured Fund II, Inc.
Schedule of Investments as of July 31, 2004 (concluded) (in Thousands)
S&P Moody's Face
Ratings Ratings Amount Municipal Bonds Value
Michigan (concluded)
BBB Baa2 $ 1,500 Dickinson County, Michigan, Economic Development Corporation, PCR, Refunding
(Champion International Corporation Project), 5.85% due 10/01/2018 $ 1,531
A NR* 2,170 Dickinson County, Michigan, Healthcare System, Hospital Revenue Refunding
Bonds, 5.80% due 11/01/2024(g) 2,220
East Grand Rapids, Michigan, Public School District, GO(d)(f):
AAA Aaa 1,610 5.75% due 5/01/2009 1,807
AAA Aaa 6,300 6% due 5/01/2009 7,141
Eaton Rapids, Michigan, Public Schools, School Building and Site, GO(d):
AAA Aaa 2,000 5.25% due 5/01/2023 2,106
AAA Aaa 1,000 5% due 5/01/2026 1,008
AAA Aaa 1,250 5% due 5/01/2029 1,253
A NR* 385 Flint, Michigan, Hospital Building Authority, Revenue Refunding Bonds (Hurley
Medical Center), Series A, 5.375% due 7/01/2020(g) 387
AAA Aaa 1,200 Fowlerville, Michigan, Community Schools, School District GO, 5% due
5/01/2030(c) 1,202
AAA Aaa 3,650 Gibraltar, Michigan, School District, School Building and Site, GO, 5% due
5/01/2028(c) 3,664
Grand Blanc, Michigan, Community Schools, GO(c):
AAA Aaa 1,000 5.625% due 5/01/2017 1,108
AAA Aaa 1,000 5.625% due 5/01/2018 1,108
AAA Aaa 1,100 5.625% due 5/01/2019 1,218
AAA Aaa 1,600 Grand Ledge, Michigan, Public Schools District, GO, Refunding, 5.375% due
5/01/2024(e) 1,664
Grand Rapids, Michigan, Building Authority Revenue Bonds, Series A(a):
AAA Aaa 1,340 5.50% due 10/01/2018 1,476
AAA Aaa 320 5.50% due 10/01/2019 351
AAA Aaa 1,500 Grand Rapids, Michigan, Sanitation Sewer System Revenue Refunding and
Improvement Bonds, Series A, 5.50% due 1/01/2022(c) 1,672
AAA Aaa 7,425 Hartland, Michigan, Consolidated School District, GO, 6% due 5/01/2010(c)(f) 8,506
AA+ Aa1 1,275 Haslett, Michigan, Public School District, Building and Site, GO, 5.625% due
5/01/2018(e) 1,411
AAA Aaa 2,000 Howell, Michigan, Public Schools, GO, 5.875% due 5/01/2009(e)(f) 2,256
AAA Aaa 2,660 Hudsonville, Michigan, Public Schools, School Building and Site, GO, 5% due
5/01/2029(d) 2,666
AAA Aaa 3,975 Jackson, Michigan, Public Schools, GO, 5.375% due 5/01/2022(c) 4,231
NR* Aaa 7,550 Kalamazoo, Michigan, Hospital Finance Authority, Hospital Facility Revenue
Refunding Bonds (Bronson Methodist Hospital), 5.50% due 5/15/2028(e) 7,711
AAA Aaa 3,000 Kent, Michigan, Hospital Finance Authority Revenue Bonds (Spectrum Health),
Series A, 5.50% due 1/15/2031(e) 3,103
AAA Aaa 1,440 Ludington, Michigan, Area School District, GO, 5.25% due 5/01/2023(e) 1,513
BBB NR* 1,000 Michigan Higher Education Facilities Authority, Limited Obligation Revenue
Refunding Bonds (Hope College), Series A, 5.90% due 4/01/2032 1,019
Michigan Higher Education Facilities Authority, Revenue Refunding Bonds
(College for Creative Studies):
NR* Baa2 550 5.85% due 12/01/2022 556
NR* Baa2 1,000 5.90% due 12/01/2027 1,002
AAA Aaa 3,000 Michigan Higher Education Student Loan Authority, Student Loan Revenue
Bonds, AMT, Series XVII-B, 5.40% due 6/01/2018(a) 3,098
Michigan State Building Authority, Revenue Bonds:
AAA Aaa 1,185 (Facilities Program), Series II, 4.67%** due 10/15/2009(a)(b) 989
AAA Aaa 1,675 (Facilities Program), Series II, 4.77%** due 10/15/2010(a)(b) 1,330
AA+ Aaa 2,675 GO, RIB, Series 481, 9.64% due 4/15/2009(e)(h) 3,294
Michigan State Building Authority, Revenue Refunding Bonds:
AAA Aaa 2,000 (Facilities Program), Series II, 5% due 10/15/2029(e) 2,004
NR* Aaa 3,500 RIB, Series 517X, 9.64% due 10/15/2010(d)(h) 4,347
Michigan State COP:
AAA Aaa 3,870 5.50% due 6/01/2027(a) 4,045
AAA NR* 5,380 RIB, Series 530, 10.12% due 9/01/2011(e)(h) 6,874
AAA Aaa 1,500 Michigan State Comprehensive Transportation Revenue Refunding Bonds,
Series A, 5.50% due 11/01/2018(d) 1,650
AAA Aaa 1,155 Michigan State, HDA, Rental Housing Revenue Bonds, AMT, Series A, 5.30% due
10/01/2037(e) 1,161
AAA Aaa 1,000 Michigan State, HDA, Revenue Refunding Bonds, AMT, Series B, 5.50% due
6/01/2030(e) 1,019
AAA Aaa 1,000 Michigan State Hospital Finance Authority, Hospital Revenue Bonds
(Mid-Michigan Obligation Group), Series A, 5.50% due 4/15/2018(a) 1,070
Michigan State Hospital Finance Authority, Hospital Revenue Refunding Bonds:
A+ A2 1,300 (Crittenton Hospital), Series A, 5.625% due 3/01/2027 1,323
A A1 1,250 (Sparrow Obligation Group), 5.625% due 11/15/2031 1,262
AAA Aaa 2,000 Michigan State Hospital Finance Authority Revenue Bonds (Mercy Health
Services), Series R, 5.375% due 8/15/2026(a)(b) 2,115
Michigan State Hospital Finance Authority, Revenue Refunding Bonds:
AAA Aaa 8,000 (Ascension Health Credit), Series A, 6.125% due 11/15/2009(e)(f) 9,225
AAA Aa2 2,500 (Ascension Health Credit), Series A, 6.125% due 11/15/2009(f) 2,883
AAA Aaa 3,760 (Ascension Health Credit), Series A, 6.25% due 11/15/2009(e)(f) 4,359
AAA Aaa 3,215 (Mercy Health Services), Series X, 6% due 8/15/2014(e) 3,615
AAA Aaa 1,000 (Mercy Mount Clemens), Series A, 6% due 5/15/2014(e) 1,121
AAA Aaa 2,000 (Mercy Mount Clemens), Series A, 5.75% due 5/15/2029(e) 2,100
AAA Aaa 1,250 (Mid-Michigan Obligation Group), Series A, 5.375% due 6/01/2027(d) 1,273
AAA Aaa 5,500 (Trinity Health), Series A, 6% due 12/01/2027(a) 5,981
AA- Aa3 1,000 (Trinity Health Credit), Series C, 5.375% due 12/01/2023 1,029
AA- Aa3 3,450 (Trinity Health Credit), Series C, 5.375% due 12/01/2030 3,483
Michigan State Strategic Fund, Limited Obligation Revenue Refunding Bonds:
AAA Aaa 8,000 (Detroit Edison Company), AMT, Series A, 5.55% due 9/01/2029(e) 8,214
AAA Aaa 2,000 (Detroit Edison Company Fund - Pollution), Series AA, 6.95% due
5/01/2011(c) 2,392
A- A3 2,200 (Detroit Edison Pollution Control), Series C, 5.45% due 9/01/2029 2,220
A- A3 1,375 (Dow Chemical Company Project), AMT, 5.50% due 12/01/2028 1,428
NR* Aaa 5,000 RIB, Series 382, 11.39% due 9/01/2025(e)(h) 5,639
BBB Baa1 2,500 Michigan State Strategic Fund, PCR, Refunding (General Motors Corp.), 6.20%
due 9/01/2020 2,654
AAA Aaa 1,500 Milan, Michigan, Area Schools, GO, Series A, 5.75% due 5/01/2010(c)(f) 1,699
AAA Aaa 6,500 Monroe County, Michigan, Economic Development Corp., Limited Obligation
Revenue Refunding Bonds (Detroit Edison Co. Project), Series AA, 6.95% due
9/01/2022(c) 8,365
AAA Aaa 2,500 Oxford, Michigan, Area Community School District, GO, 5.40% due 5/01/2025(c) 2,608
AAA Aaa 1,000 Plainwell, Michigan, Community Schools, School District (School Building and
Site), GO, 5.50% due 5/01/2018(d) 1,099
A NR* 1,000 Pontiac, Michigan, Tax Increment Finance Authority, Revenue Refunding Bonds
(Tax Increment-Development Area Number 3), 5.375% due 6/01/2017(g) 1,021
AAA Aaa 1,000 Reed, Michigan, City Public Schools, School Building and Site, GO, 5% due
5/01/2026(d) 1,008
AA+ Aa1 1,900 Rochester, Michigan, Community School District, GO, Series II, 5.50% due
5/01/2018(e) 2,085
AAA Aaa 1,500 Romulus, Michigan, Community Schools, GO, 5.75% due 5/01/2009(c)(f) 1,684
Saginaw Valley State University, Michigan, General Revenue Refunding Bonds(c):
NR* Aaa 1,450 5% due 7/01/2024 1,476
NR* Aaa 1,000 5% due 7/01/2034 998
NR* Aaa 6,500 Saint Clair County, Michigan, Economic Revenue Refunding Bonds (Detroit
Edison Company), RIB, Series 282, 11.42% due 8/01/2024(a)(h) 8,260
AAA Aaa 2,650 South Lyon, Michigan, Community Schools, GO, Series A, 5.75% due
5/01/2023(e) 2,910
Southfield, Michigan, Public Schools, School Building and Site, GO,
Series A(d):
AAA Aaa 1,950 5.25% due 5/01/2027 2,019
AAA Aaa 1,000 5% due 5/01/2029 1,002
AAA Aaa 1,000 Sparta, Michigan, Area Schools, School Building and Site, GO, 5% due
5/01/2030(c) 1,000
AAA Aaa 6,500 Wayne Charter County, Michigan, Airport Revenue Bonds (Detroit Metropolitan
Wayne County), AMT, Series A, 5.375% due 12/01/2015(e) 6,917
AAA Aaa 1,180 Wayne Charter County, Michigan, Detroit Metropolitan Airport, GO, Airport
Hotel, Series A, 5% due 12/01/2030(e) 1,181
AAA Aaa 1,330 Zeeland, Michigan, Public Schools, School Building and Site, GO, 5% due
5/01/2029(e) 1,333
Guam 0.8%
AAA Aaa 1,440 A.B. Won Guam International Airport Authority, General Revenue Refunding
Bonds, Series A, 5.25% due 10/01/2019(e) 1,542
Puerto Rico 3.4%
AAA Aaa 2,270 Puerto Rico Electric Power Authority, Power Revenue Bonds, Trust Receipts,
Class R, Series 16 HH, 10.07% due 7/01/2013(d)(h) 2,917
BBB+ Baa2 2,900 Puerto Rico Public Finance Corporation, Commonwealth Appropriation Revenue
Bonds, Series E, 5.75% due 2/01/2007(f) 3,146
Total Municipal Bonds (Cost - $239,787) - 145.6% 259,426
Shares
Held Short-Term Securities
5,157 CMA Michigan Municipal Money Fund*** 5,157
Total Short-Term Securities (Cost - $5,157) - 2.9% 5,157
Total Investments (Cost - $244,944+) - 148.5% 264,583
Other Assets Less Liabilities - 1.5% 2,699
Preferred Stock, at Redemption Value - (50.0%) (89,133)
----------
Net Assets Applicable to Common Stock - 100.0% $ 178,149
==========
(a) AMBAC Insured.
(b) Escrowed to maturity.
(c) FGIC Insured.
(d) FSA Insured.
(e) MBIA Insured.
(f) Prerefunded.
(g) ACA Insured
(h) The interest rate is subject to change periodically and
inversely based upon prevailing market rates. The interest rate
shown is the rate in effect at July 31, 2004.
* Not Rated.
** Represents a zero coupon bond; the interest rate shown reflects
the effective yield at the time of purchase by the Fund.
*** Investments in companies considered to be an affiliate of the
Fund (such companies are defined as "Affiliated Companies" in
Section 2(a)(3) of the Investment Company Act of 1940) were as
follows:
(in Thousands)
Net Dividend
Affiliate Activity Income
CMA Michigan Municipal Money Fund (3,352) $ 29
+ The cost and unrealized appreciation/depreciation of investments
as of July 31, 2004, as computed for federal income tax purposes
were as follows:
(in Thousands)
Aggregate cost $ 244,944
==============
Gross unrealized appreciation $ 19,673
Gross unrealized depreciation (34)
--------------
Net unrealized appreciation $ 19,639
==============
Forward interest rate swaps outstanding as of July 31, 2004 were as
follows:
(in Thousands)
Notional Unrealized
Amount Depreciation
Receive a variable rate equal to 7-Day
Bond Market Association Municipal Swap
Index Rate and pay a fixed rate
of 4.081%
Broker, J.P. Morgan Chase Bank
Expires August 2014 $ 6,000 $ (164)
Receive a variable rate equal to 7-Day
Bond Market Association Municipal Swap
Index Rate and pay a fixed rate
of 4.229%
Broker, J.P. Morgan Chase Bank
Expires August 2014 $ 7,100 (281)
Receive a variable rate equal to 7-Day
Bond Market Association Municipal Swap
Index Rate and pay a fixed rate
of 3.885%
Broker, J.P. Morgan Chase Bank
Expires October 2014 $13,500 (86)
--------
Total $ (531)
========
Item 2 - Controls and Procedures
2(a) - The registrant's certifying officers have reasonably designed
such disclosure controls and procedures to ensure material
information relating to the registrant is made known to us by others
particularly during the period in which this report is being
prepared. The registrant's certifying officers have determined that
the registrant's disclosure controls and procedures are effective
based on our evaluation of these controls and procedures as of a
date within 90 days prior to the filing date of this report.
2(b) - There were no changes in the registrant's internal control
over financial reporting (as defined in Rule 30a-3(d) under the Act
(17 CFR 270.30a-3(d)) that occurred during the last fiscal quarter
of the period covered by this report that has materially affected,
or is reasonably likely to materially affect, the registrant's
internal control over financial reporting.
Item 3 - Exhibits
Certifications - Attached hereto
Pursuant to the requirements of the Securities Exchange Act of 1934
and the Investment Company Act of 1940, the registrant has duly
caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
MuniYield Michigan Insured Fund II, Inc.
By: _/s/ Terry K. Glenn________
Terry K. Glenn,
President of
MuniYield Michigan Insured Fund II, Inc.
Date: September 17, 2004
Pursuant to the requirements of the Securities Exchange Act of 1934
and the Investment Company Act of 1940, this report has been signed
below by the following persons on behalf of the registrant and in
the capacities and on the dates indicated.
By: _/s/ Terry K. Glenn________
Terry K. Glenn,
President of
MuniYield Michigan Insured Fund II, Inc.
Date: September 17, 2004
By: _/s/ Donald C. Burke________
Donald C. Burke,
Chief Financial Officer of
MuniYield Michigan Insured Fund II, Inc.
Date: September 17, 2004