Eaton Vance California Municipal Bond Fund II

 

 

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form N-Q

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED

MANAGEMENT INVESTMENT COMPANIES

811-21217

Investment Company Act File Number

Eaton Vance California Municipal Bond Fund II

(Exact Name of Registrant as Specified in Charter)

Two International Place, Boston, Massachusetts 02110

(Address of Principal Executive Offices)

Maureen A. Gemma

Two International Place, Boston, Massachusetts 02110

(Name and Address of Agent for Services)

(617) 482-8260

(Registrant’s Telephone Number, Including Area Code)

September 30

Date of Fiscal Year End

December 31, 2013

Date of Reporting Period

 

 

 

Item 1. Schedule of Investments

Eaton Vance

California Municipal Bond Fund II

December 31, 2013

PORTFOLIO OF INVESTMENTS (Unaudited)

Tax-Exempt Investments — 173.8%

 

                                                 
Security    Principal
Amount
(000’s omitted)		      Value  

Education — 18.9%

      

California Educational Facilities Authority, (Claremont McKenna College), 5.00%, 1/1/39

    $ 1,370       $ 1,423,348   

California Educational Facilities Authority, (Harvey Mudd College), 5.25%, 12/1/31

      395         421,031   

California Educational Facilities Authority, (Harvey Mudd College), 5.25%, 12/1/36

      160         167,912   

California Educational Facilities Authority, (Loyola Marymount University), 5.00%, 10/1/22

      70         78,763   

California Educational Facilities Authority, (Loyola Marymount University), 5.00%, 10/1/30

      380         392,031   

California Educational Facilities Authority, (Santa Clara University), 5.00%, 2/1/29

      890         945,999   

California Educational Facilities Authority, (Stanford University), 5.00%, 6/1/43

      525         593,134   

California Educational Facilities Authority, (University of San Francisco), 6.125%, 10/1/36

      115         130,657   

California Educational Facilities Authority, (University of Southern California), 5.25%, 10/1/39

      1,200         1,271,688   

California Educational Facilities Authority, (University of the Pacific), 5.00%, 11/1/30

      330         345,652   

California Municipal Finance Authority, (University of San Diego), 5.00%, 10/1/31

      210         216,930   

California Municipal Finance Authority, (University of San Diego), 5.00%, 10/1/35

      145         146,660   

California Municipal Finance Authority, (University of San Diego), 5.25%, 10/1/26

      405         439,478   

California Municipal Finance Authority, (University of San Diego), 5.25%, 10/1/27

      425         456,705   

California Municipal Finance Authority, (University of San Diego), 5.25%, 10/1/28

      450         480,339   

University of California, 5.25%, 5/15/39

      1,000         1,059,450   
     

 

 

  
      $ 8,569,777   
     

 

 

  

Electric Utilities — 7.0%

      

Los Angeles Department of Water and Power, Electric System Revenue, 5.25%, 7/1/32

    $ 745       $ 799,102   

Sacramento Municipal Utility District, 5.00%, 8/15/30

      420         445,322   

Sacramento Municipal Utility District, 5.00%, 8/15/31

      125         131,519   

Southern California Public Power Authority, (Tieton Hydropower), 5.00%, 7/1/30

      1,000         1,065,580   

Vernon, Electric System Revenue, 5.125%, 8/1/21

      675         726,657   
     

 

 

  
      $ 3,168,180   
     

 

 

  

General Obligations — 19.6%

      

California, 5.50%, 11/1/35

    $ 1,300       $ 1,422,018   

Palo Alto, (Election of 2008), 5.00%, 8/1/40

      1,850         1,941,889   

San Bernardino Community College District, 4.00%, 8/1/30

      1,510         1,413,979   

San Diego Community College District, (Election of 2002), 5.00%, 8/1/32

      720         768,614   

San Diego Community College District, (Election of 2006), 5.00%, 8/1/31

      455         487,878   

San Jose-Evergreen Community College District, (Election of 2010), 5.00%, 8/1/33

      350         374,154   

San Jose-Evergreen Community College District, (Election of 2010), 5.00%, 8/1/35

      410         434,633   

San Mateo Union High School District, (Election of 2006), 5.00%, 9/1/27

      685         763,467   

San Mateo Union High School District, (Election of 2006), 5.00%, 9/1/28

      1,170         1,290,604   
     

 

 

  
      $ 8,897,236   
     

 

 

  

Hospital — 16.7%

      

California Health Facilities Financing Authority, (Catholic Healthcare West), 5.625%, 7/1/32

    $ 1,330       $ 1,353,501   

California Health Facilities Financing Authority, (Cedars-Sinai Medical Center), 5.00%, 8/15/39

      1,400         1,386,938   

California Health Facilities Financing Authority, (City of Hope), 5.00%, 11/15/32

      335         339,898   

 

1

 

 

                                                 
Security    Principal
Amount
(000’s omitted)		      Value  

California Health Facilities Financing Authority, (City of Hope), 5.00%, 11/15/35

    $ 475       $ 474,658   

California Health Facilities Financing Authority, (Memorial Health Services), 5.00%, 10/1/27

      750         800,302   

California Health Facilities Financing Authority, (St. Joseph Health System), 5.00%, 7/1/33

      600         614,592   

California Health Facilities Financing Authority, (St. Joseph Health System), 5.00%, 7/1/37

      280         281,683   

California Statewide Communities Development Authority, (Cottage Health System), 5.25%, 11/1/30

      1,000         1,035,600   

Washington Township Health Care District, 5.00%, 7/1/32

      555         533,938   

Washington Township Health Care District, 5.25%, 7/1/29

      750         749,970   
     

 

 

  
      $ 7,571,080   
     

 

 

  

Insured – Education — 7.7%

      

California Educational Facilities Authority, (Pepperdine University), (AMBAC), 5.00%, 12/1/32

    $ 420       $ 436,388   

California Educational Facilities Authority, (Pepperdine University), (AMBAC), 5.00%, 12/1/35

      1,000         1,025,990   

California State University, (AGM), (BHAC), 5.00%, 11/1/39(1)

      2,000         2,022,520   
     

 

 

  
      $ 3,484,898   
     

 

 

  

Insured – Electric Utilities — 7.8%

      

Los Angeles Department of Water and Power, Electric System Revenue, (AMBAC), (BHAC), 5.00%, 7/1/26(1)

    $ 1,500       $ 1,641,060   

Puerto Rico Electric Power Authority, (NPFG), 5.25%, 7/1/34

      1,035         815,797   

Sacramento Municipal Utility District, (AGM), 5.00%, 8/15/27

      1,000         1,081,470   
     

 

 

  
      $ 3,538,327   
     

 

 

  

Insured – Escrowed/Prerefunded — 12.6%

      

California Infrastructure and Economic Development Bank, (Bay Area Toll Bridges), (AMBAC), Prerefunded to 1/1/28, 5.00%, 7/1/33

    $ 1,150       $ 1,345,902   

California Infrastructure and Economic Development Bank, (Bay Area Toll Bridges), (AMBAC), Prerefunded to 1/1/28, 5.00%, 7/1/36

      1,025         1,199,609   

Clovis Unified School District, (NPFG), Escrowed to Maturity, 0.00%, 8/1/20

      3,130         2,704,664   

Orange County Water District, Certificates of Participation, (NPFG), Prerefunded to 8/15/32, 5.00%, 8/15/34

      395         439,746   
     

 

 

  
      $ 5,689,921   
     

 

 

  

Insured – General Obligations — 26.5%

      

Antelope Valley Community College District, (Election of 2004), (NPFG), 5.25%, 8/1/39

    $ 725       $ 767,956   

Arcadia Unified School District, (Election of 2006), (AGM), 0.00%, 8/1/38

      7,125         1,791,225   

Arcadia Unified School District, (Election of 2006), (AGM), 0.00%, 8/1/40

      2,525         533,230   

Carlsbad Unified School District, (Election of 2006), (NPFG), 5.25%, 8/1/32

      1,500         1,597,215   

Coast Community College District, (Election of 2002), (AGM), 0.00%, 8/1/35

      6,675         2,017,986   

El Camino Hospital District, (NPFG), 4.45%, 8/1/36

      575         558,066   

Palm Springs Unified School District, (Election of 2008), (AGC), 5.00%, 8/1/33

      1,250         1,297,875   

Riverside Community College District, (Election of 2004), (AGM), (NPFG), 5.00%, 8/1/32

      1,040         1,084,668   

Union Elementary School District, (Election of 1999), (NPFG), 0.00%, 9/1/22

      3,200         2,352,832   
     

 

 

  
      $ 12,001,053   
     

 

 

  

Insured – Hospital — 6.6%

      

California Statewide Communities Development Authority, (Kaiser Permanente), (BHAC), 5.00%, 3/1/41(1)

    $ 1,250       $ 1,256,225   

California Statewide Communities Development Authority, (Sutter Health), (AGM), 5.05%, 8/15/38(1)

      1,750         1,745,012   
     

 

 

  
      $ 3,001,237   
     

 

 

  

Insured – Lease Revenue/Certificates of Participation — 4.0%

      

San Diego County Water Authority, Certificates of Participation, (AGM), 5.00%, 5/1/38(1)

    $ 1,750       $ 1,814,733   
     

 

 

  
      $ 1,814,733   
     

 

 

  

 

2

 

 

                                                 
Security    Principal
Amount
(000’s omitted)		      Value  

Insured – Special Tax Revenue — 9.4%

      

Cathedral City Public Financing Authority, (Housing Redevelopment), (NPFG), 5.00%, 8/1/33

    $ 1,400       $ 1,342,558   

Hesperia Public Financing Authority, (Redevelopment and Housing Projects), (XLCA), 5.00%, 9/1/37

      1,535         1,311,182   

Puerto Rico Sales Tax Financing Corp., (NPFG), 0.00%, 8/1/45

      2,675         295,347   

Santa Clara Valley Transportation Authority, Sales Tax Revenue, (AMBAC), 5.00%, 4/1/32

      1,225         1,295,474   
     

 

 

  
      $ 4,244,561   
     

 

 

  

Insured – Transportation — 4.2%

      

San Joaquin Hills Transportation Corridor Agency, (NPFG), 0.00%, 1/15/27

    $ 3,520       $ 1,572,771   

San Jose, Airport Revenue, (AMBAC), 5.00%, 3/1/33

      330         331,799   
     

 

 

  
      $ 1,904,570   
     

 

 

  

Insured – Water and Sewer — 9.1%

      

Calleguas Las Virgines Public Financing Authority, (Municipal Water District), (BHAC), (FGIC), 4.75%, 7/1/37

    $ 1,235       $ 1,255,649   

East Bay Municipal Utility District, Water System Revenue, (AGM), (FGIC), 5.00%, 6/1/32

      100         105,796   

East Bay Municipal Utility District, Water System Revenue, (NPFG), 5.00%, 6/1/32(1)

      1,600         1,692,736   

Riverside, Water System Revenue, (AGM), 5.00%, 10/1/38

      445         460,330   

Santa Clara Valley Water District, (AGM), 3.75%, 6/1/28

      615         617,325   
     

 

 

  
      $ 4,131,836   
     

 

 

  

Lease Revenue/Certificates of Participation — 1.1%

      

California Public Works Board, 5.00%, 11/1/38

    $ 480       $ 479,966   
     

 

 

  
      $ 479,966   
     

 

 

  

Special Tax Revenue — 6.6%

      

Los Angeles County Metropolitan Transportation Authority, Sales Tax Revenue, 5.00%, 7/1/31

    $ 1,490       $ 1,575,884   

San Francisco Bay Area Rapid Transit District, Sales Tax Revenue, 5.00%, 7/1/28

      1,300         1,407,380   
     

 

 

  
      $ 2,983,264   
     

 

 

  

Transportation — 13.6%

      

Bay Area Toll Authority, Toll Bridge Revenue, (San Francisco Bay Area), 5.25%, 4/1/29

    $ 1,190       $ 1,313,022   

Long Beach, Harbor Revenue, 5.00%, 5/15/27

      540         585,414   

Los Angeles Department of Airports, (Los Angeles International Airport),
5.00%, 5/15/35(1)(2)

      1,060         1,097,937   

Los Angeles Harbor Department, 5.00%, 8/1/25

      1,250         1,388,113   

San Francisco City and County Airport Commission, (San Francisco International Airport), 5.00%, 5/1/35

      635         647,033   

San Jose, Airport Revenue, 5.00%, 3/1/20

      1,000         1,148,740   
     

 

 

  
      $ 6,180,259   
     

 

 

  

Water and Sewer — 2.4%

      

Metropolitan Water District of Southern California, 5.00%, 1/1/39

    $ 1,050       $ 1,105,472   
     

 

 

  
      $ 1,105,472   
     

 

 

  

Total Tax-Exempt Investments — 173.8%
(identified cost $77,316,803)

       $ 78,766,370   
     

 

 

  

Auction Preferred Shares Plus Cumulative Unpaid Dividends — (56.7)%

       $ (25,700,767 ) 
     

 

 

  

Other Assets, Less Liabilities — (17.1)%

       $ (7,736,162 ) 
     

 

 

  

Net Assets Applicable to Common Shares — 100.0%

       $ 45,329,441   
     

 

 

  

 

3

 

 

The percentage shown for each investment category in the Portfolio of Investments is based on net assets applicable to common shares.

 

AGC

   -   Assured Guaranty Corp.

AGM

   -   Assured Guaranty Municipal Corp.

AMBAC

   -   AMBAC Financial Group, Inc.

BHAC

   -   Berkshire Hathaway Assurance Corp.

FGIC

   -   Financial Guaranty Insurance Company

NPFG

   -   National Public Finance Guaranty Corp.

XLCA

   -   XL Capital Assurance, Inc.

The Fund invests primarily in debt securities issued by California municipalities. The ability of the issuers of the debt securities to meet their obligations may be affected by economic developments in a specific industry or municipality. In order to reduce the risk associated with such economic developments, at December 31, 2013, 50.5% of total investments are backed by bond insurance of various financial institutions and financial guaranty assurance agencies. The aggregate percentage insured by an individual financial institution or financial guaranty assurance agency ranged from 1.6% to 19.3% of total investments.

 

(1) Security represents the municipal bond held by a trust that issues residual interest bonds.

 

(2) Security (or a portion thereof) has been pledged as collateral for residual interest bond transactions. The aggregate value of such collateral is $302,937.

A summary of open financial instruments at December 31, 2013 is as follows:

Futures Contracts

 

Expiration
Month/Year		   

Contracts

    Position    Aggregate Cost     Value     Net Unrealized
Appreciation		  
3/14    15 U.S. 10-Year Treasury Note    Short    $     (1,875,090 )    $     (1,845,703 )    $ 29,387   
3/14    23 U.S. Long Treasury Bond    Short      (3,000,380 )      (2,951,188 )      49,192   
            

 

 

  
             $     78,579   
            

 

 

  

At December 31, 2013, the Fund had sufficient cash and/or securities to cover commitments under these contracts.

The Fund is subject to interest rate risk in the normal course of pursuing its investment objective. Because the Fund holds fixed-rate bonds, the value of these bonds may decrease if interest rates rise. The Fund purchases and sells U.S. Treasury futures contracts to hedge against changes in interest rates.

At December 31, 2013, the aggregate fair value of open derivative instruments (not considered to be hedging instruments for accounting disclosure purposes) in an asset position and whose primary underlying risk exposure is interest rate risk was $78,579.

The cost and unrealized appreciation (depreciation) of investments of the Fund at December 31, 2013, as determined on a federal income tax basis, were as follows:

 

Aggregate cost

    $     67,267,243   
  

 

 

  

Gross unrealized appreciation

    $ 3,280,936   

Gross unrealized depreciation

      (1,666,809 ) 
  

 

 

  

Net unrealized appreciation

    $ 1,614,127   
  

 

 

  

Under generally accepted accounting principles for fair value measurements, a three-tier hierarchy to prioritize the assumptions, referred to as inputs, is used in valuation techniques to measure fair value. The three-tier hierarchy of inputs is summarized in the three broad levels listed below.

 

•  

Level 1 — quoted prices in active markets for identical investments

 

•  

Level 2 — other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.)

 

•  

Level 3 — significant unobservable inputs (including a fund’s own assumptions in determining the fair value of investments)

 

4

 

 

In cases where the inputs used to measure fair value fall in different levels of the fair value hierarchy, the level disclosed is determined based on the lowest level input that is significant to the fair value measurement in its entirety. The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

At December 31, 2013, the hierarchy of inputs used in valuing the Fund’s investments and open derivative instruments, which are carried at value, were as follows:

 

Asset Description    Level 1      Level 2      Level 3      Total  

Tax-Exempt Investments

    $ —       $ 78,766,370       $ —       $ 78,766,370   

Total Investments

    $ —       $ 78,766,370       $ —       $ 78,766,370   

Futures Contracts

    $ 78,579       $ —       $ —       $ 78,579   

Total

    $     78,579       $     78,766,370       $     —       $     78,844,949   

The Fund held no investments or other financial instruments as of September 30, 2013 whose fair value was determined using Level 3 inputs. At December 31, 2013, there were no investments transferred between Level 1 and Level 2 during the fiscal year to date then ended.

For information on the Fund’s policy regarding the valuation of investments and other significant accounting policies, please refer to the Fund’s most recent financial statements included in its semiannual or annual report to shareholders.

 

5

 

 

Item 2. Controls and Procedures

(a) It is the conclusion of the registrant’s principal executive officer and principal financial officer that the effectiveness of the registrant’s current disclosure controls and procedures (such disclosure controls and procedures having been evaluated within 90 days of the date of this filing) provide reasonable assurance that the information required to be disclosed by the registrant on this Form N-Q has been recorded, processed, summarized and reported within the time period specified in the Commission’s rules and forms and that the information required to be disclosed by the registrant on this Form N-Q has been accumulated and communicated to the registrant’s principal executive officer and principal financial officer in order to allow timely decisions regarding required disclosure.

(b) There have been no changes in the registrant’s internal controls over financial reporting during the fiscal quarter for which the report is being filed that have materially affected, or are reasonably likely to materially affect the registrant’s internal control over financial reporting.

Signatures

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.

Eaton Vance California Municipal Bond Fund II

 

By:   /s/ Payson F. Swaffield
  Payson F. Swaffield
  President
Date:   February 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/ Payson F. Swaffield
  Payson F. Swaffield
  President
Date:   February 24, 2014

 

By:   /s/ James F. Kirchner
  James F. Kirchner
  Treasurer
Date:   February 24, 2014