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 811-21178
Name of Fund: BlackRock Municipal Income Quality Trust (BYM)
Fund Address: 100 Bellevue Parkway, Wilmington, DE 19809
Name and address of agent for service: John M. Perlowski, Chief Executive Officer, BlackRock Municipal
Income Quality Trust, 55 East 52nd Street, New York, NY 10055
Registrant’s telephone number, including area code: (800) 882-0052, Option 4
Date of fiscal year end: 08/31/2014
Date of reporting period: 11/30/2013
Item 1 – Schedule of Investments
| Schedule of Investments November 30, 2013 (Unaudited) |
BlackRock Municipal Income Quality Trust (BYM) (Percentages shown are based on Net Assets) |
| Municipal Bonds | Par (000) |
Value | ||||||
| Alabama — 3.9% |
||||||||
| City of Birmingham Alabama Airport Authority, ARB, Series 2010 (AGM), 5.50%, 7/01/40 |
$ | 5,800 | $ | 6,046,674 | ||||
| City of Birmingham Alabama Special Care Facilities Financing Authority, RB, Children’s Hospital (AGC), 6.00%, 6/01/39 |
1,495 | 1,671,903 | ||||||
| County of Jefferson Alabama, Limited Obligation Schools, RB, Series A, 4.75%, 1/01/25 |
2,800 | 2,576,924 | ||||||
| State of Alabama Docks Department, Refunding RB, 6.00%, 10/01/40 |
3,800 | 4,207,436 | ||||||
|
|
|
|||||||
| 14,502,937 | ||||||||
| Alaska — 0.3% |
||||||||
| Alaska Industrial Development & Export Authority, RB, Providence Health Services, Series A, 5.50%, 10/01/41 |
1,070 | 1,119,092 | ||||||
| Arizona — 0.5% |
||||||||
| State of Arizona, COP, Department of Administration, Series A (AGM): |
||||||||
| 5.00%, 10/01/27 |
1,500 | 1,586,550 | ||||||
| 5.25%, 10/01/28 |
250 | 266,115 | ||||||
|
|
|
|||||||
| 1,852,665 | ||||||||
| California — 15.0% |
||||||||
| California Health Facilities Financing Authority, RB, Series A: |
||||||||
| St. Joseph Health System, 5.75%, 7/01/39 |
625 | 692,294 | ||||||
| Sutter Health, 5.00%, 8/15/52 |
1,160 | 1,108,415 | ||||||
| California Infrastructure & Economic Development Bank, RB, Bay Area Toll Bridges, 1st Lien, Series A (AMBAC), 5.00%, 1/01/28 (a) |
10,100 | 12,009,304 | ||||||
| California State Public Works Board, LRB: |
||||||||
| Various Capital Projects, Series I, 5.50%, 11/01/33 |
1,415 | 1,529,544 | ||||||
| Various Judicial Council Projects, Series A, 5.00%, 3/01/38 |
3,080 | 3,075,472 | ||||||
| California Statewide Communities Development Authority, RB, Kaiser Permanente, Series A, 5.00%, 4/01/42 |
1,620 | 1,598,130 | ||||||
| Municipal Bonds | Par (000) |
Value | ||||||
| California (concluded) |
||||||||
| Coast Community College District, GO, CAB, Election of 2002, Series C (AGM): |
||||||||
| 5.00%, 8/01/31 |
$ | 7,450 | $ | 7,786,814 | ||||
| 5.59%, 8/01/36 (b) |
4,200 | 1,203,342 | ||||||
| County of Orange California Sanitation District, COP, Series B (AGM), 5.00%, 2/01/31 |
2,500 | 2,642,100 | ||||||
| Monterey Peninsula Community College District, GO, CAB, Series C (AGM) (b): |
||||||||
| 5.36%, 8/01/31 |
13,575 | 5,330,631 | ||||||
| 5.43%, 8/01/32 |
14,150 | 5,203,521 | ||||||
| Mount San Antonio Community College District, GO, Refunding, CAB, Election of 2008, Series A, 5.66%, 8/01/43 |
1,580 | 738,271 | ||||||
| San Diego California Unified School District, GO, CAB, Election of 2008, Series C, 5.65%, 7/01/38 (b) |
2,000 | 508,200 | ||||||
| San Diego California Unified School District, GO, Refunding, CAB, Series R-1, 5.24%, 7/01/31 (b) |
1,400 | 563,654 | ||||||
| San Jose California Unified School District, GO, Election of 2002, Series B (NPFGC), 5.00%, 8/01/15 (a) |
2,350 | 2,535,110 | ||||||
| State of California, GO, Refunding, Various Purpose, 5.00%, 10/01/41 |
1,100 | 1,117,754 | ||||||
| State of California, GO, Various Purposes, 5.00%, 4/01/42 |
5,000 | 5,081,500 | ||||||
| Yosemite Community College District, GO, CAB, Election of 2004, Series D, 5.68%, 8/01/37 (b) |
10,000 | 2,655,800 | ||||||
|
|
|
|||||||
| 55,379,856 | ||||||||
| Colorado — 0.5% |
||||||||
| Colorado State Board of Governors, Refunding RB, State University System Enterprise, Series A, 5.00%, 3/01/43 |
875 | 912,161 | ||||||
| Regional Transportation District, COP, Refunding, Series A, 5.38%, 6/01/31 |
960 | 1,014,394 | ||||||
|
|
|
|||||||
| 1,926,555 | ||||||||
| BLACKROCK MUNICIPAL INCOME QUALITY TRUST | NOVEMBER 30, 2013 | 1 |
| Schedule of Investments (continued) |
BlackRock Municipal Income Quality Trust (BYM) (Percentages shown are based on Net Assets) |
| Municipal Bonds | Par (000) |
Value | ||||||
| District of Columbia — 2.6% |
||||||||
| District of Columbia Tobacco Settlement Financing Corp., Refunding RB, Asset-Backed, 6.75%, 5/15/40 |
$ | 9,500 | $ | 9,452,405 | ||||
| Florida — 12.8% |
||||||||
| City of Jacksonville Florida, Refunding RB, Transportation, Series A, 5.00%, 10/01/30 |
320 | 337,997 | ||||||
| County of Broward Florida School Board, COP, Series A (AGM), 5.25%, 7/01/33 |
1,400 | 1,479,352 | ||||||
| County of Broward Florida Water & Sewer Utility, Refunding RB, Series A, 5.25%, 10/01/34 |
6,750 | 7,258,140 | ||||||
| County of Duval Florida School Board, COP, Master Lease Program (AGM), 5.00%, 7/01/33 |
3,475 | 3,575,844 | ||||||
| County of Miami-Dade Florida, RB: |
||||||||
| CAB, Special Obligation, Sub-Series A (NPFGC), 5.91%, 10/01/38 (b) |
22,270 | 5,241,022 | ||||||
| Seaport, Series A, 6.00%, 10/01/38 |
2,770 | 3,014,425 | ||||||
| Transit System Sales Surtax (AGM), 5.00%, 7/01/35 |
1,300 | 1,327,612 | ||||||
| County of Miami-Dade Florida, Refunding RB, Special Obligation, Sub-Series B, 5.00%, 10/01/37 |
780 | 783,268 | ||||||
| County of Miami-Dade Florida Aviation, Refunding ARB, Miami International Airport: |
||||||||
| Series A, 5.50%, 10/01/36 |
5,000 | 5,235,600 | ||||||
| Series A-1, 5.50%, 10/01/41 |
5,000 | 5,192,800 | ||||||
| County of Sarasota Florida Public Hospital District, RB, Sarasota Memorial Hospital Project, Series A, 5.63%, 7/01/39 |
300 | 306,099 | ||||||
| Florida Housing Finance Corp., RB, Homeowner Mortgage, Series 3 (Ginnie Mae, Fannie Mae & Freddie Mac), 5.45%, 7/01/33 |
2,455 | 2,524,943 | ||||||
| Florida State Department of Environmental Protection, RB, Florida Forever Project, Series B (NPFGC), 5.00%, 7/01/27 |
6,150 | 6,595,875 | ||||||
| Reedy Creek Improvement District, GO, Series A, 5.25%, 6/01/33 |
1,340 | 1,421,284 | ||||||
| South Florida Water Management District, COP (AMBAC), 5.00%, 10/01/36 |
1,000 | 1,023,300 | ||||||
| Municipal Bonds | Par (000) |
Value | ||||||
| Florida (concluded) |
||||||||
| Tohopekaliga Water Authority, Refunding RB, Series A, 5.25%, 10/01/36 |
$ | 2,000 | $ | 2,118,360 | ||||
|
|
|
|||||||
| 47,435,921 | ||||||||
| Georgia — 2.7% |
||||||||
| City of Atlanta Georgia Department of Aviation, Refunding GARB, Series C, 6.00%, 1/01/30 |
7,500 | 8,511,675 | ||||||
| County of Burke Georgia Development Authority, Refunding RB, Oglethorpe Power-Vogtle Project, Series C, 5.70%, 1/01/43 |
1,250 | 1,303,313 | ||||||
|
|
|
|||||||
| 9,814,988 | ||||||||
| Hawaii — 1.5% |
||||||||
| State of Hawaii Harbor System, RB, Series A, 5.50%, 7/01/35 |
5,000 | 5,361,650 | ||||||
| Illinois — 11.4% |
||||||||
| City of Chicago Illinois, Refunding RB, Sales Tax Receipts, Series A, 5.00%, 1/01/41 |
3,875 | 3,857,717 | ||||||
| City of Chicago Illinois Board of Education, GO, Series A, 5.50%, 12/01/39 |
2,430 | 2,364,487 | ||||||
| City of Chicago Illinois O’Hare International Airport Revenue, Refunding GARB, Senior Lien, Series D, 5.25%, 1/01/34 |
9,800 | 9,948,078 | ||||||
| City of Chicago Illinois O’Hare International Airport Revenue, GARB, 3rd Lien, Series A, 5.63%, 1/01/35 |
1,525 | 1,576,636 | ||||||
| City of Chicago Illinois Park District, GO, Harbor Facilities, Series C, 5.25%, 1/01/40 |
600 | 607,404 | ||||||
| City of Chicago Illinois Transit Authority, RB, Sales Tax Receipts, 5.25%, 12/01/36 |
650 | 663,189 | ||||||
| County of Cook Illinois Community College District No. 508, GO, 5.13%, 12/01/38 |
7,700 | 7,708,932 | ||||||
| County of Cook Illinois Forest Preserve District, GO, Refunding, Limited Tax Project, Series B, 5.00%, 12/15/37 |
310 | 316,913 | ||||||
| County of Cook Illinois Forest Preserve District, GO, Series C, 5.00%, 12/15/37 |
360 | 369,047 | ||||||
| 2 | BLACKROCK MUNICIPAL INCOME QUALITY TRUST | NOVEMBER 30, 2013 |
| Schedule of Investments (continued) |
BlackRock Municipal Income Quality Trust (BYM) (Percentages shown are based on Net Assets) |
| Municipal Bonds | Par (000) |
Value | ||||||
| Illinois (concluded) |
||||||||
| Metropolitan Pier & Exposition Authority, RB, McCormick Place Expansion Project, Series A, 5.00%, 6/15/42 |
$ | 4,775 | $ | 4,797,968 | ||||
| Metropolitan Pier & Exposition Authority, Refunding RB, McCormick Place Expansion Project, Series B, 4.25%, 6/15/42 |
9,000 | 7,913,520 | ||||||
| Railsplitter Tobacco Settlement Authority, RB, 6.00%, 6/01/28 |
710 | 772,956 | ||||||
| State of Illinois, GO, Various Purposes: |
||||||||
| 5.50%, 7/01/33 |
880 | 894,379 | ||||||
| 5.50%, 7/01/38 |
475 | 474,340 | ||||||
|
|
|
|||||||
| 42,265,566 | ||||||||
| Indiana — 2.1% |
||||||||
| Indiana Finance Authority, RB, Wastewater Utility, CWA Authority Project, 1st Lien, Series A, 5.25%, 10/01/38 |
1,100 | 1,148,752 | ||||||
| Indiana Municipal Power Agency, RB, Series B, 5.75%, 1/01/34 |
450 | 452,241 | ||||||
| Indianapolis Local Public Improvement Bond Bank, Refunding RB, Waterworks Project, Series A (AGC), 5.50%, 1/01/38 |
5,750 | 6,035,315 | ||||||
|
|
|
|||||||
| 7,636,308 | ||||||||
| Iowa — 2.3% |
||||||||
| Iowa Finance Authority, RB, Iowa Healthcare Facilities: |
||||||||
| Genesis Health System, 5.50%, 7/01/33 |
3,000 | 3,124,620 | ||||||
| Series A (AGC), 5.63%, 8/15/37 |
5,000 | 5,308,400 | ||||||
|
|
|
|||||||
| 8,433,020 | ||||||||
| Kentucky — 0.4% |
||||||||
| State of Kentucky Property & Building Commission, Refunding RB, Project No. 93 (AGC), 5.25%, 2/01/29 |
1,500 | 1,620,915 | ||||||
| Municipal Bonds | Par (000) |
Value | ||||||
| Louisiana — 2.9% |
||||||||
| Louisiana Local Government Environmental Facilities & Community Development Authority, RB, East Baton Rouge Sewerage Commission Projects, Sub-Lien, Series A: |
||||||||
| 5.00%, 2/01/43 |
$ | 1,550 | $ | 1,560,090 | ||||
| 4.00%, 2/01/48 |
1,550 | 1,307,038 | ||||||
| State of Louisiana Gasoline & Fuels Tax, RB, Series A (AGM), 5.00%, 5/01/31 |
7,500 | 7,893,900 | ||||||
|
|
|
|||||||
| 10,761,028 | ||||||||
| Massachusetts — 0.4% |
||||||||
| Massachusetts School Building Authority, RB, Dedicated Sales Tax, Senior Series A, 5.00%, 5/15/43 |
1,395 | 1,462,476 | ||||||
| Michigan — 4.9% |
||||||||
| City of Detroit Michigan, Refunding RB, Sewage Disposal System, 2nd Lien, Series E (BHAC), 5.75%, 7/01/31 |
3,000 | 3,067,650 | ||||||
| City of Lansing Michigan, RB, Board of Water & Light Utilities System, Series A, 5.50%, 7/01/41 |
1,100 | 1,172,193 | ||||||
| Michigan Finance Authority, Refunding RB, Trinity Health Credit Group, 5.00%, 12/01/39 |
9,050 | 8,894,792 | ||||||
| Michigan State Building Authority, Refunding RB, Facilities Program: |
||||||||
| Series I-A, 5.38%, 10/15/36 |
2,000 | 2,075,240 | ||||||
| Series I-A, 5.38%, 10/15/41 |
800 | 812,784 | ||||||
| Series II-A, 5.38%, 10/15/36 |
1,500 | 1,556,430 | ||||||
| Western Michigan University, Refunding RB, General, University and College Improvements (AGM), 5.00%, 11/15/39 |
430 | 432,675 | ||||||
|
|
|
|||||||
| 18,011,764 | ||||||||
| Nebraska — 2.0% |
||||||||
| Central Plains Energy Project Nebraska, RB, Gas Project No. 3, 5.25%, 9/01/37 |
7,345 | 7,369,973 | ||||||
| Nevada — 1.1% |
||||||||
| County of Clark Nevada, ARB, Las Vegas-McCarran International Airport, Series A (AGM), 5.25%, 7/01/39 |
4,100 | 4,218,039 | ||||||
| BLACKROCK MUNICIPAL INCOME QUALITY TRUST | NOVEMBER 30, 2013 | 3 |
| Schedule of Investments (continued) |
BlackRock Municipal Income Quality Trust (BYM) (Percentages shown are based on Net Assets) |
| Municipal Bonds | Par (000) |
Value | ||||||
| New Jersey — 3.8% |
||||||||
| New Jersey Transportation Trust Fund Authority, RB: |
||||||||
| CAB, Transportation System, Series A, 5.85%, 12/15/38 (b) |
$ | 5,845 | $ | 1,379,186 | ||||
| CAB, Transportation System, Series A, 5.90%, 12/15/40 (b) |
10,000 | 2,075,200 | ||||||
| Transportation Program, Series AA, 5.25%, 6/15/33 |
1,660 | 1,760,994 | ||||||
| Transportation System, Series A, 5.50%, 6/15/41 |
3,000 | 3,133,470 | ||||||
| Transportation System, Series B, 5.25%, 6/15/36 |
5,000 | 5,205,100 | ||||||
| Rutgers — The State University of New Jersey, Refunding RB, Series L, 5.00%, 5/01/43 |
515 | 536,589 | ||||||
|
|
|
|||||||
| 14,090,539 | ||||||||
| New York — 5.4% |
||||||||
| Hudson Yards Infrastructure Corp., RB, Series A, 5.75%, 2/15/47 |
770 | 821,544 | ||||||
| New York City Transitional Finance Authority, BARB, Fiscal 2009, Series S-4, 5.50%, 1/15/33 |
1,950 | 2,151,552 | ||||||
| New York City Transitional Finance Authority Future Tax Secured Revenue, Refunding RB, Series B, 5.00%, 11/01/30 |
14,250 | 15,410,092 | ||||||
| State of New York Dormitory Authority, ERB, Series B, 5.75%, 3/15/36 |
1,300 | 1,451,476 | ||||||
|
|
|
|||||||
| 19,834,664 | ||||||||
| Ohio — 0.8% |
||||||||
| County of Lucas Ohio, Refunding RB, Promedica Healthcare, Series A, 6.50%, 11/15/37 |
610 | 687,818 | ||||||
| Ohio Higher Educational Facility Commission, Refunding RB, Kenyon College Project, 5.00%, 7/01/37 |
385 | 390,552 | ||||||
| Ohio State Turnpike Commission, RB, Junior Lien, Infrastructure Projects, Series A-1: |
||||||||
| 5.25%, 2/15/32 |
780 | 832,759 | ||||||
| 5.25%, 2/15/33 |
1,095 | 1,164,784 | ||||||
|
|
|
|||||||
| 3,075,913 | ||||||||
| Pennsylvania — 0.4% |
||||||||
| Pennsylvania Turnpike Commission, RB: |
||||||||
| Series C, 5.50%, 12/01/33 |
630 | 682,416 | ||||||
| Municipal Bonds | Par (000) |
Value | ||||||
| Pennsylvania (concluded) |
||||||||
| Pennsylvania Turnpike Commission, RB (concluded): |
||||||||
| Subordinate, Special Motor License Fund, 6.00%, 12/01/36 |
$ | 625 | $ | 699,094 | ||||
|
|
|
|||||||
| 1,381,510 | ||||||||
| South Carolina — 2.1% |
||||||||
| South Carolina Jobs EDA, Refunding RB, Palmetto Health, Series A (AGM), 6.50%, 8/01/39 |
260 | 284,575 | ||||||
| South Carolina State Ports Authority, RB, 5.25%, 7/01/40 |
5,000 | 5,165,500 | ||||||
| South Carolina State Public Service Authority, Refunding RB, Santee Cooper, Series B, 5.00%, 12/01/38 |
2,360 | 2,399,035 | ||||||
|
|
|
|||||||
| 7,849,110 | ||||||||
| Tennessee — 0.4% |
||||||||
| Memphis Center City Revenue Finance Corp., RB, Pyramid & Pinch District, Series B (AGM), 5.25%, 11/01/30 |
1,240 | 1,323,489 | ||||||
| Texas — 26.9% |
||||||||
| City of San Antonio Texas Public Service Board, RB, Junior Lien, 5.00%, 2/01/38 |
615 | 639,741 | ||||||
| City of San Antonio Texas Water System, Refunding RB (NPFGC) (a): |
||||||||
| 5.13%, 5/15/14 |
9,250 | 9,461,825 | ||||||
| 5.13%, 5/15/14 |
10,000 | 10,229,000 | ||||||
| Comal Texas ISD, GO, School Building (PSF-GTD), 5.00%, 2/01/36 |
2,500 | 2,633,925 | ||||||
| Coppell Texas ISD, GO, CAB, Refunding (PSF-GTD), 3.95%, 8/15/30 (b) |
10,030 | 5,217,004 | ||||||
| County of Harris Texas, GO, Refunding (NPFGC) (b): |
||||||||
| 3.55%, 8 /15/25 |
7,485 | 4,968,618 | ||||||
| 3.79%, 8/15/28 |
10,915 | 6,286,167 | ||||||
| County of Harris Texas Houston Sports Authority, Refunding RB (NPFGC) (b): |
||||||||
| 3rd Lien, Series A-3, 7.11%, 11/15/38 |
16,890 | 2,952,879 | ||||||
| CAB, Junior Lien, Series H, 7.11%, 11/15/38 |
5,785 | 1,011,392 | ||||||
| CAB, Junior Lien, Series H, 7.12%, 11/15/39 |
6,160 | 991,822 | ||||||
| 4 | BLACKROCK MUNICIPAL INCOME QUALITY TRUST | NOVEMBER 30, 2013 |
| Schedule of Investments (continued) |
BlackRock Municipal Income Quality Trust (BYM) (Percentages shown are based on Net Assets) |
| Municipal Bonds | Par (000) |
Value | ||||||
| Texas (concluded) |
||||||||
| County of Midland Texas Fresh Water Supply District No. 1, RB, CAB, City of Midland Project, Series A, 5.03%, 9/15/36 (b) |
$ | 2,340 | $ | 755,048 | ||||
| Dallas-Fort Worth International Airport, Refunding ARB, Series F, 5.25%, 11/01/33 |
1,090 | 1,139,704 | ||||||
| Mansfield Texas ISD, GO, School Building (PSF-GTD), 5.00%, 2/15/33 |
2,980 | 3,190,299 | ||||||
| North Texas Tollway Authority, RB, Special Projects System, Series A, 6.00%, 9/01/41 |
1,000 | 1,108,250 | ||||||
| North Texas Tollway Authority, Refunding RB, 1st Tier System: |
||||||||
| (NPFGC), 5.75%, 1/01/40 |
23,050 | 24,370,995 | ||||||
| Series A, 6.00%, 1/01/28 |
625 | 703,125 | ||||||
| Northside Independent School District, GO, School Building (PSF-GTD), 5.13%, 6/15/29 |
9,500 | 9,684,015 | ||||||
| San Antonio Public Facilities Corp., Refunding RB, Convention Center Refinancing & Expansion Project, 4.00%, 9/15/42 |
2,575 | 2,173,686 | ||||||
| Texas Municipal Gas Acquisition & Supply Corp. III, RB: |
||||||||
| 5.00%, 12/15/28 |
3,600 | 3,521,628 | ||||||
| 5.00%, 12/15/31 |
2,105 | 2,020,253 | ||||||
| Texas Transportation Commission, Refunding RB, Central Texas Turnpike System, 1st Tier, Series A, 5.00%, 8/15/41 |
6,250 | 6,148,187 | ||||||
|
|
|
|||||||
| 99,207,563 | ||||||||
| Washington — 2.7% |
||||||||
| County of King Washington Sewer, Refunding RB (AGM), 5.00%, 1/01/36 |
2,200 | 2,286,922 | ||||||
| Washington Health Care Facilities Authority, RB: |
||||||||
| MultiCare Health System, Remarketing, Series B, 5.00%, 8/15/44 |
2,000 | 1,981,240 | ||||||
| MultiCare Health System, Series C (AGC), 5.50%, 8/15/43 |
4,000 | 4,130,120 | ||||||
| Providence Health & Services, Series A, 5.25%, 10/01/39 |
675 | 691,389 | ||||||
| Municipal Bonds | Par (000) |
Value | ||||||
| Washington (concluded) |
||||||||
| Washington Health Care Facilities Authority, Refunding RB, Providence Health & Services, Series A, 5.00%, 10/01/42 |
$ | 940 | $ | 932,837 | ||||
|
|
|
|||||||
| 10,022,508 | ||||||||
| Wisconsin — 0.4% |
||||||||
| Wisconsin State Health & Educational Facilities Authority, RB, Ascension Health Senior Care Group, 5.00%, 11/15/33 |
1,500 | 1,562,670 | ||||||
| Total Municipal Bonds — 110.2% |
406,973,124 | |||||||
| Municipal Bonds Transferred to Tender Option Bond (TOB) Trusts (c) |
||||||||
| Arizona — 2.0% |
||||||||
| City of Phoenix Arizona Civic Improvement Corp., Refunding RB, Water System, Junior Lien, Series A, 5.00%, 7/01/34 |
1,300 | 1,374,022 | ||||||
| Phoenix Civic Improvement Corp., RB, Sub-Civic Plaza Expansion Project, Series A (NPFGC), 5.00%, 7/01/37 |
4,490 | 4,577,465 | ||||||
| Salt River Project Agricultural Improvement & Power District, RB, Electric System, Series A, 5.00%, 1/01/38 |
1,500 | 1,564,410 | ||||||
|
|
|
|||||||
| 7,515,897 | ||||||||
| California — 8.3% |
||||||||
| California State University, RB, Systemwide, Series A (AGM), 5.00%, 11/01/33 (d) |
3,379 | 3,486,421 | ||||||
| California State University, Refunding RB, Systemwide, Series A (AGM), 5.00%, 11/01/32 |
8,000 | 8,318,800 | ||||||
| County of San Diego California Water Authority, COP, Refunding, Series A (AGM), 5.00%, 5/01/33 |
4,870 | 5,150,463 | ||||||
| Foothill-De Anza Community College District, GO, Refunding, Election of 1999, Series C (NPFGC), 5.00%, 8/01/36 |
7,500 | 7,779,300 | ||||||
| Los Angeles Community College District California, GO, Election of 2001, Series A (AGM) (NPFGC), 5.00%, 8/01/32 |
5,000 | 5,248,500 | ||||||
| BLACKROCK MUNICIPAL INCOME QUALITY TRUST | NOVEMBER 30, 2013 | 5 |
| Schedule of Investments (continued) |
BlackRock Municipal Income Quality Trust (BYM) (Percentages shown are based on Net Assets) |
| Municipal Bonds Transferred to Tender Option Bond (TOB) Trusts (c) |
Par (000) |
Value | ||||||
| California (concluded) |
||||||||
| San Diego Community College District California, GO, Election of 2002, 5.25%, 8/01/33 |
$ | 449 | $ | 498,515 | ||||
|
|
|
|||||||
| 30,481,999 | ||||||||
| District of Columbia — 0.3% |
||||||||
| District of Columbia, RB, Series A, 5.50%, 12/01/30 (d) |
1,080 | 1,206,198 | ||||||
| Florida — 10.4% |
||||||||
| City of Tallahassee Florida, RB, Energy System (NPFGC): |
||||||||
| 5.00%, 10/01/32 (d) |
3,000 | 3,103,860 | ||||||
| 5.00%, 10/01/37 |
5,000 | 5,076,600 | ||||||
| County of Highlands Florida Health Facilities Authority, RB, Adventist, Series C, 5.25%, 11/15/16 (e) |
1,800 | 1,841,508 | ||||||
| County of Miami-Dade Florida, Refunding RB, Transit System Sales Surtax, 5.00%, 7/01/42 |
1,950 | 1,983,969 | ||||||
| County of Miami-Dade Florida Water & Sewer System, RB (AGM), 5.00%, 10/01/39 |
10,101 | 10,270,324 | ||||||
| County of Orange Florida School Board, COP, Series A: |
||||||||
| (AGC), 5.50%, 8/01/34 |
6,096 | 6,502,051 | ||||||
| (NPFGC), 5.00%, 8/01/30 |
6,000 | 6,276,900 | ||||||
| State of Florida Board of Education, GO, Refunding, Series D, 5.00%, 6/01/37 (d) |
2,999 | 3,147,825 | ||||||
|
|
|
|||||||
| 38,203,037 | ||||||||
| Hawaii — 2.8% |
||||||||
| Honolulu City & County Board of Water Supply, RB, Series A (NPFGC), 5.00%, 7/01/14 (a) |
10,000 | 10,284,200 | ||||||
| Illinois — 8.5% |
||||||||
| City of Chicago Illinois, RB, Motor Fuel Tax Project, Series A (AGC), 5.00%, 1/01/38 |
8,310 | 7,929,153 | ||||||
| Illinois Finance Authority, RB, The Carle Foundation, Series A (AGM), 6.00%, 8/15/41 |
2,400 | 2,561,280 | ||||||
| Illinois State Toll Highway Authority, RB: |
||||||||
| Senior Priority, Series B, 5.50%, 1/01/33 |
4,499 | 4,851,614 | ||||||
| Series A, 5.00%, 1/01/38 |
7,714 | 7,649,871 | ||||||
| Metropolitan Pier & Exposition Authority, RB, McCormick Place Expansion Project, Series A, 5.00%, 6/15/42 |
7,020 | 7,053,766 | ||||||
| Municipal Bonds Transferred to Tender Option Bond (TOB) Trusts (c) |
Par (000) |
Value | ||||||
| Illinois (concluded) |
||||||||
| State of Illinois, RB, Build Illinois, Series B, 5.25%, 6/15/34 (d) |
$ | 1,400 | $ | 1,442,237 | ||||
|
|
|
|||||||
| 31,487,921 | ||||||||
| Massachusetts — 3.7% |
||||||||
| Massachusetts School Building Authority, RB, Dedicated Sales Tax, Series A (AGM): |
||||||||
| 5.00%, 8/15/15 (a) |
1,674 | 1,751,913 | ||||||
| 5.00%, 8/15/30 |
11,314 | 11,842,880 | ||||||
|
|
|
|||||||
| 13,594,793 | ||||||||
| Nevada — 1.8% |
||||||||
| City of Las Vegas Nevada, GO, Limited Tax, Performing Arts Center, 6.00%, 4/01/39 (d) |
4,197 | 4,507,591 | ||||||
| County of Clark Nevada Water Reclamation District, GO, Limited Tax, Series B, 5.75%, 7/01/34 |
2,024 | 2,291,568 | ||||||
|
|
|
|||||||
| 6,799,159 | ||||||||
| New Jersey — 0.6% |
||||||||
| New Jersey Transportation Trust Fund Authority, RB, Transportation System, Series B, 5.25%, 6/15/36 (d) |
2,000 | 2,082,502 | ||||||
| New York — 8.0% |
||||||||
| City of New York New York Municipal Water Finance Authority, Refunding RB, Water & Sewer System, 2nd General Resolution, Series CC, 5.00%, 6/15/47 |
6,240 | 6,385,891 | ||||||
| County of Erie New York Industrial Development Agency, RB, City of Buffalo School District Project, Series A (AGM), 5.75%, 5/01/28 |
4,494 | 4,969,086 | ||||||
| Metropolitan Transportation Authority, RB, Dedicated Tax, Series A (NPFGC), 5.00%, 11/15/31 |
7,002 | 7,429,863 | ||||||
| New York State Urban Development Corp., RB, Personal Income Tax, General Purpose, Series A-1, 5.00%, 3/15/43 |
5,720 | 5,899,780 | ||||||
| Triborough Bridge & Tunnel Authority, RB, General, Series A-2, 5.25%, 11/15/34 (d) |
4,500 | 4,852,710 | ||||||
|
|
|
|||||||
| 29,537,330 | ||||||||
| 6 | BLACKROCK MUNICIPAL INCOME QUALITY TRUST | NOVEMBER 30, 2013 |
| Schedule of Investments (continued) |
BlackRock Municipal Income Quality Trust (BYM) (Percentages shown are based on Net Assets) |
| Municipal Bonds Transferred to Tender Option Bond (TOB) Trusts (c) |
Par (000) |
Value | ||||||
| Ohio — 0.2% |
||||||||
| State of Ohio, RB, Cleveland Clinic Health Obligated Group, Series B, 5.50%, 1/01/34 |
$ | 620 | $ | 657,436 | ||||
| South Carolina — 0.2% |
||||||||
| South Carolina State Public Service Authority, Refunding RB, Santee Cooper, Series A, 5.50%, 1/01/38 (d) |
600 | 646,992 | ||||||
| Texas — 1.9% |
||||||||
| City of Houston Texas, Refunding RB, Airport System, Senior Lien, Series A, 5.50%, 7/01/34 |
4,167 | 4,558,576 | ||||||
| County of Tarrant Texas Cultural Education Facilities Finance Corp., RB, Baylor Health Care System Project, Series A, 5.00%, 11/15/38 |
719 | 719,926 | ||||||
| North East Texas ISD, GO, School Building, Series A (PSF-GTD), 5.00%, 8/01/37 (d) |
1,500 | 1,599,375 | ||||||
|
|
|
|||||||
| 6,877,877 | ||||||||
| Utah — 1.4% |
||||||||
| Utah Transit Authority, RB, Series A, 5.00%, 6/15/36 |
5,000 | 5,285,950 | ||||||
| Virginia — 0.1% |
||||||||
| County of Fairfax Virginia IDA, Refunding RB, Health Care, Inova Health System, Series A, 5.50%, 5/15/35 |
400 | 423,438 | ||||||
| Washington — 1.0% |
||||||||
| Central Puget Sound Regional Transit Authority, RB, Series A (AGM), 5.00%, 11/01/32 |
3,494 | 3,660,519 | ||||||
| Municipal Bonds Transferred to Tender Option Bond (TOB) Trusts (c) |
Par (000) |
Value | ||||||
| Wisconsin — 1.6% |
||||||||
| Wisconsin Health & Educational Facilities Authority, Refunding RB, Froedtert & Community Health, Inc.: |
||||||||
| Series A, 5.00%, 4/01/42 |
$ | 3,520 | $ | 3,462,131 | ||||
| Series C, 5.25%, 4/01/39 |
2,500 | 2,558,175 | ||||||
|
|
|
|||||||
| 6,020,306 | ||||||||
| Total Municipal Bonds Transferred to Tender Option Bond (TOB) Trusts — 52.8% |
|
194,765,554 | ||||||
| Total Long-Term Investments (Cost — $591,345,847) — 163.0% |
|
601,738,678 | ||||||
| Short-Term Securities | Shares | |||||||
| FFI Institutional Tax-Exempt Fund, 0.03% (f)(g) |
6,959,037 | 6,959,037 | ||||||
| Total Short-Term Securities (Cost — $6,959,037) — 1.9% |
|
6,959,037 | ||||||
| Total Investments (Cost — $598,304,884*) — 164.9% |
|
608,697,715 | ||||||
| Other Assets Less Liabilities — 1.7% |
6,130,391 | |||||||
| Liability for TOB Trust Certificates, Including Interest Expense and Fees Payable — (29.4%) |
|
(108,532,419 | ) | |||||
| VMTP Shares, at Liquidation Value — (37.2%) |
|
(137,200,000 | ) | |||||
|
|
|
|||||||
| Net Assets Applicable to Common Shares — 100.0% |
|
$ | 369,095,687 | |||||
|
* As of November 30, 2013, gross unrealized appreciation and depreciation based on cost for federal income tax purposes were as follows:
|
| |||||||
| Tax cost |
$ | 492,231,122 | ||||||
|
|
|
|||||||
| Gross unrealized appreciation |
$ | 23,767,501 | ||||||
| Gross unrealized depreciation |
(15,788,615 | ) | ||||||
|
|
|
|||||||
| Net unrealized appreciation |
$ | 7,978,886 | ||||||
|
|
|
|||||||
| Notes to Schedule of Investments |
| (a) | US government securities, held in escrow, are used to pay interest on this security, as well as to retire the bond in full at the date indicated, typically at a premium to par. |
| (b) | Represents a zero-coupon bond. Rate shown reflects the current yield as of report date. |
| (c) | Represent bonds transferred to a TOB. In exchange the Trust acquired residual interest certificates. These bonds serve as collateral in a financing transaction. |
| (d) | All or a portion of security is subject to a recourse agreement, which may require the Trust to pay the liquidity provider in the event there is a shortfall between the TOB trust certificates and proceeds received from the sale of the security contributed to the TOB trust. In the case of a shortfall, the aggregate maximum potential amount the Trust could ultimately be required to pay under the agreements, which expire from February 1, 2016 to December 1, 2029 is $14,474,164. |
| (e) | Variable rate security. Rate shown is as of report date and maturity shown is the date the principal owed can be recovered through demand. |
| BLACKROCK MUNICIPAL INCOME QUALITY TRUST | NOVEMBER 30, 2013 | 7 |
| Schedule of Investments (continued) |
BlackRock Municipal Income Quality Trust (BYM) |
| (f) | Investments in issuers considered to be an affiliate of the Trust during the period ended November 30, 2013, for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows: |
| Affiliate |
Shares Held at August 31, 2013 |
Net Activity |
Shares Held at November 30, 2013 |
Income | ||||||||||||
| FFI Institutional Tax-Exempt Fund |
5,187,077 | 1,771,960 | 6,959,037 | $ | 669 | |||||||||||
| (g) | Represents the current yield as of report date. |
| Portfolio Abbreviations | ||
| To simplify the listings of portfolio holdings in the Schedule of Investments, the names and descriptions of many of the securities have been abbreviated according to the following list: |
AGC | Assured Guarantee Corp. | ||
| AGM | Assured Guaranty Municipal Corp. | |||
| AMBAC | American Municipal Bond Assurance Corp. | |||
| ARB | Airport Revenue Bonds | |||
| BARB | Building Aid Revenue Bonds | |||
| BHAC | Berkshire Hathaway Assurance Corp. | |||
| CAB | Capital Appreciation Bonds | |||
| COP | Certificates of Participation | |||
| EDA | Economic Development Authority | |||
| ERB | Education Revenue Bonds | |||
| Fannie Mae | Federal National Mortgage Association | |||
| Freddie Mac | Federal Home Loan Mortgage Corp. | |||
| GARB | General Airport Revenue Bonds | |||
| Ginnie Mae | Government National Mortgage Association | |||
| GO | General Obligation Bonds | |||
| IDA | Industrial Development Authority | |||
| ISD | Independent School District | |||
| LRB | Lease Revenue Bonds | |||
| NPFGC | National Public Finance Guarantee Corp. | |||
| PSF-GTD | Permanent School Fund Guaranteed | |||
| RB | Revenue Bonds |
| Ÿ | Financial futures contracts as of November 30, 2013 were as follows: |
| Contracts Sold | Issue | Exchange | Expiration | Notional Value |
Unrealized Appreciation |
|||||||||||
| (225 | ) | 10-Year US Treasury Note | Chicago Board of Trade | December 2013 | $ | 28,494,141 | $ | 36,317 | ||||||||
| 8 | BLACKROCK MUNICIPAL INCOME QUALITY TRUST | NOVEMBER 30, 2013 |
| Schedule of Investments (continued) |
BlackRock Municipal Income Quality Trust (BYM) |
| Ÿ | Fair Value Measurements — Various inputs are used in determining the fair value of investments and derivative financial instruments. These inputs to valuation techniques are categorized into a disclosure hierarchy consisting of three broad levels for financial reporting purposes as follows: |
| Ÿ | Level 1 — unadjusted price quotations in active markets/exchanges for identical assets or liabilities that the Trust has the ability to access |
| Ÿ | Level 2 — other observable inputs (including, but not limited to, quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs) |
| Ÿ | Level 3 — unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Trust’s own assumptions used in determining the fair value of investments and derivative financial instruments) |
The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the fair value hierarchy classification is determined based on the lowest level input that is significant to the fair value measurement in its entirety.
Changes in valuation techniques may result in transfers into or out of an assigned level within the disclosure hierarchy. In accordance with the Trust’s policy, transfers between different levels of the fair value disclosure hierarchy are deemed to have occurred as of the beginning of the reporting period. The categorization of a value determined for investments and derivative financial instruments is based on the pricing transparency of the investment and derivative financial instrument and is not necessarily an indication of the risks associated with investing in those securities. For information about the Trust’s policy regarding valuation of investments and derivative financial instruments, please refer to the Trust’s most recent financial statements as contained in its annual report.
The following tables summarize the Trust’s investments and derivative financial instruments categorized in the disclosure hierarchy as of November 30, 2013:
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
| Assets: |
||||||||||||||||
| Investments: | ||||||||||||||||
| Long-Term Investments1 |
— | $ | 601,738,678 | — | $ | 601,738,678 | ||||||||||
| Short-Term Securities |
$ | 6,959,037 | — | — | 6,959,037 | |||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total |
$ | 6,959,037 | $ | 601,738,678 | — | $ | 608,697,715 | |||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| 1 See above Schedule of Investments for values in each state or political subdivision. |
| |||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
| Derivative Financial Instruments2 |
||||||||||||||||
| Assets: |
||||||||||||||||
| Interest rate contracts |
$ | 36,317 | — | — | $ | 36,317 | ||||||||||
|
2 Derivative financial instruments are financial futures contracts, which are valued at the unrealized appreciation/depreciation on the instrument. |
| |||||||||||||||
| BLACKROCK MUNICIPAL INCOME QUALITY TRUST | NOVEMBER 30, 2013 | 9 |
| Schedule of Investments (concluded) |
BlackRock Municipal Income Quality Trust (BYM) |
Certain of the Trust’s assets and/or liabilities are held at carrying amount, which approximates fair value for financial reporting purposes. As of November 30, 2013, such assets/or and liabilities are categorized within the disclosure hierarchy as follows:
| Level 1 | Level 2 | Level 3 | Total | |||||||||||
| Assets: |
||||||||||||||
| Cash pledged for financial futures contracts |
$ | 399,000 | — | — | $ | 399,000 | ||||||||
| Liabilities: | ||||||||||||||
| Bank overdraft |
— | $ | (6,499 | ) | — | (6,499 | ) | |||||||
| TOB trust certificates |
— | (108,487,707 | ) | — | (108,487,707 | ) | ||||||||
| VMTP Shares |
— | (137,200,000 | ) | — | (137,200,000 | ) | ||||||||
|
|
|
|
|
|
|
|
||||||||
| Total |
$ | 399,000 | $ | (245,694,206 | ) | — | $ | (245,295,206 | ) | |||||
|
|
|
|
|
|
|
|
||||||||
There were no transfers between levels during the period ended November 30, 2013.
| 10 | BLACKROCK MUNICIPAL INCOME QUALITY TRUST | NOVEMBER 30, 2013 |
Item 2 – Controls and Procedures
| 2(a) – |
The registrant’s principal executive and principal financial officers, or persons performing similar functions, have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”)) are effective as of a date within 90 days of the filing of this report based on the evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act and Rule 13a-15(b) under the Securities Exchange Act of 1934, as amended. | |
| 2(b) – |
There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) that occurred during the registrant’s last fiscal quarter that have materially affected, or are 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.
BlackRock Municipal Income Quality Trust
| By: | /s/ John M. Perlowski | |
| John M. Perlowski | ||
| Chief Executive Officer (principal executive officer) of | ||
| BlackRock Municipal Income Quality Trust | ||
| Date: | January 24, 2014 | |
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/ John M. Perlowski | |
| John M. Perlowski | ||
| Chief Executive Officer (principal executive officer) of | ||
| BlackRock Municipal Income Quality Trust | ||
| Date: | January 24, 2014 | |
| By: | /s/ Neal J. Andrews | |
| Neal J. Andrews | ||
| Chief Financial Officer (principal financial officer) of | ||
| BlackRock Municipal Income Quality Trust | ||
| Date: | January 24, 2014 | |