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

June 30, 2014

Date of Reporting Period

 

 

 

Item 1. Schedule of Investments

Eaton Vance

California Municipal Bond Fund II

June 30, 2014

PORTFOLIO OF INVESTMENTS (Unaudited)

Tax-Exempt Investments — 169.2%

 

                                                 
Security    Principal
Amount
(000’s omitted)		      Value  

Education — 16.7%

      

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

    $ 1,370       $ 1,496,191   

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

      395         443,518   

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

      160         177,435   

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

      70         81,907   

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

      380         417,419   

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

      890         985,488   

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

      115         137,403   

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

      1,200         1,359,252   

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

      330         366,386   

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

      210         231,071   

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

      145         157,608   

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

      405         458,201   

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

      425         478,337   

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

      450         504,778   

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

      1,000         1,140,300   
     

 

 

  
   $ 8,435,294   
     

 

 

  

Electric Utilities — 6.7%

      

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

    $ 745       $ 845,232   

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

      420         480,320   

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

      125         142,179   

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

      1,000         1,148,280   

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

      675         753,030   
     

 

 

  
   $ 3,369,041   
     

 

 

  

General Obligations — 23.6%

      

California, 5.50%, 11/1/35

    $ 1,300       $ 1,509,404   

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

      1,850         2,029,024   

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

      1,510         1,573,677   

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

      720         811,534   

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

      455         514,396   

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

      350         394,695   

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

      410         458,331   

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

      685         819,465   

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

      1,170         1,395,108   

Torrance Unified School District, (Election of 2008), 5.00%, 8/1/35

      1,125         1,260,450   

Ventura County Community College District, 5.00%, 8/1/29

      1,000         1,162,350   
     

 

 

  
   $ 11,928,434   
     

 

 

  

Hospital — 15.8%

      

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

    $ 1,330       $ 1,361,574   

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

      1,400         1,501,080   

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

      335         364,845   

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

      475         513,418   

 

1

 

 

                                                 
Security    Principal
Amount
(000’s omitted)		      Value  

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

    $ 750       $ 851,565   

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

      600         660,468   

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

      280         304,192   

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

      1,000         1,089,730   

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

      555         568,820   

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

      750         750,735   
     

 

 

  
   $ 7,966,427   
     

 

 

  

Insured-Education — 7.4%

      

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

    $ 420       $ 441,722   

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

      1,000         1,051,720   

California State University, (AGM), (BHAC), 5.00%, 11/1/39(2)

      2,000         2,228,980   
     

 

 

  
   $ 3,722,422   
     

 

 

  

Insured-Electric Utilities — 7.6%

      

Los Angeles Department of Water and Power, Electric System Revenue, (AMBAC), (BHAC), 5.00%, 7/1/26(2)

    $ 1,500       $ 1,675,440   

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

      1,035         996,560   

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

      1,000         1,137,200   
     

 

 

  
   $ 3,809,200   
     

 

 

  

Insured-Escrowed/Prerefunded — 10.9%

      

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

    $ 1,150       $ 1,473,943   

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

      525         672,887   

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

      3,130         2,861,196   

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

      395         478,136   
     

 

 

  
   $ 5,486,162   
     

 

 

  

Insured-General Obligations — 26.2%

      

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

    $ 725       $ 805,874   

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

      7,125         2,191,579   

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

      2,525         691,118   

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

      1,500         1,667,325   

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

      6,675         2,218,035   

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

      575         584,390   

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

      1,250         1,394,175   

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

      1,040         1,146,548   

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

      3,200         2,536,064   
     

 

 

  
   $ 13,235,108   
     

 

 

  

Insured-Hospital — 6.2%

      

California Statewide Communities Development Authority, (Kaiser Permanente), (BHAC), 5.00%, 3/1/41(2)

    $ 1,250       $ 1,317,450   

California Statewide Communities Development Authority, (Sutter Health), (AGM), 5.05%, 8/15/38(2)

      1,750         1,828,977   
     

 

 

  
   $ 3,146,427   
     

 

 

  

 

2

 

 

                                                 
Security    Principal
Amount
(000’s omitted)		      Value  

Insured-Lease Revenue/Certificates of Participation — 3.8%

      

San Diego County Water Authority, Certificates of Participation, (AGM), 5.00%, 5/1/38(2)

    $ 1,750       $ 1,941,520   
     

 

 

  
   $ 1,941,520   
     

 

 

  

Insured-Special Tax Revenue — 9.2%

      

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

    $ 1,400       $ 1,401,428   

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

      1,535         1,547,418   

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

      2,675         354,304   

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

      1,225         1,338,619   
     

 

 

  
   $ 4,641,769   
     

 

 

  

Insured-Transportation — 4.3%

      

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

    $ 3,520       $ 1,810,970   

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

      330         341,599   
     

 

 

  
   $ 2,152,569   
     

 

 

  

Insured-Water and Sewer — 8.4%

      

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

    $ 1,235       $ 1,273,421   

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

      100         109,765   

East Bay Municipal Utility District, Water System Revenue, (NPFG), 5.00%, 6/1/32(2)

      1,600         1,756,240   

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

      445         497,822   

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

      615         625,381   
     

 

 

  
   $ 4,262,629   
     

 

 

  

Lease Revenue/Certificates of Participation — 1.1%

      

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

    $ 480       $ 529,056   
     

 

 

  
   $ 529,056   
     

 

 

  

Special Tax Revenue — 7.3%

      

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

    $ 1,490       $ 1,666,327   

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

      1,300         1,460,069   

Successor Agency to La Quinta Redevelopment Agency, 5.00%, 9/1/29(3)

      500         571,275   
     

 

 

  
   $ 3,697,671   
     

 

 

  

Transportation — 11.7%

      

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

    $ 1,190       $ 1,379,865   

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

      540         607,559   

Los Angeles Department of Airports, (Los Angeles International Airport),
5.00%, 5/15/35(2) (4)

      1,060         1,173,865   

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

      1,250         1,463,125   

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

      635         681,908   

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

      500         586,660   
     

 

 

  
   $ 5,892,982   
     

 

 

  

Water and Sewer — 2.3%

      

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

    $ 1,050       $ 1,173,805   
     

 

 

  
   $ 1,173,805   
     

 

 

  

Total Tax-Exempt Investments — 169.2%
(identified cost $78,616,396)

       $ 85,390,516   
     

 

 

  

 

3

 

 

                                                 
            Value  

Auction Preferred Shares Plus Cumulative Unpaid Dividends — (50.9)%

       $ (25,700,463 ) 
     

 

 

  

Other Assets, Less Liabilities — (18.3)%

       $ (9,218,763 ) 
     

 

 

  

Net Assets Applicable to Common Shares — 100.0%

       $ 50,471,290   
     

 

 

  

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 June 30, 2014, 49.7% 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 19.2% of total investments.

 

(1) Security (or a portion thereof) has been segregated to cover payable for when-issued securities.

 

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

 

(3) When-issued security.

 

(4) Security (or a portion thereof) has been pledged as collateral for residual interest bond transactions. The aggregate value of such collateral is $378,865.

A summary of open financial instruments at June 30, 2014 is as follows:

Futures Contracts

 

Expiration
Month/Year		   

Contracts

    Position    Aggregate Cost     Value     Net Unrealized
Depreciation		  
9/14    15 U.S. 10-Year Treasury Note    Short    $     (1,874,855 )    $     (1,877,578 )    $ (2,723 ) 
9/14    23 U.S. Long Treasury Bond    Short      (3,131,912 )      (3,155,313 )      (23,401 ) 
            

 

 

  
             $     (26,124 ) 
            

 

 

  

At June 30, 2014, 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 June 30, 2014, the aggregate fair value of open derivative instruments (not considered to be hedging instruments for accounting disclosure purposes) in a liability position and whose primary underlying risk exposure is interest rate risk was $26,124.

The cost and unrealized appreciation (depreciation) of investments of the Fund at June 30, 2014, as determined on a federal income tax basis, were as follows:

 

Aggregate cost

    $     68,558,465   
  

 

 

  

Gross unrealized appreciation

    $ 7,194,231   

Gross unrealized depreciation

      (247,180 ) 
  

 

 

  

Net unrealized appreciation

    $ 6,947,051   
  

 

 

  

 

4

 

 

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)

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 June 30, 2014, 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

    $ —      $ 85,390,516       $ —       $ 85,390,516   

Total Investments

    $ —      $     85,390,516       $ —       $     85,390,516   
Liability Description                               

Futures Contracts

    $ (26,124 )    $ —       $ —       $ (26,124 ) 

Total

    $     (26,124 )    $ —       $ —       $ (26,124 ) 

The Fund held no investments or other financial instruments as of September 30, 2013 whose fair value was determined using Level 3 inputs. At June 30, 2014, 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:   August 25, 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:   August 25, 2014

 

By:   /s/ James F. Kirchner
  James F. Kirchner
  Treasurer
Date:   August 25, 2014