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, 2011
Date of Reporting Period
 
 

 


 

Item 1. Schedule of Investments

 


 

Eaton Vance
California Municipal Bond Fund II
December 31, 2011
 
PORTFOLIO OF INVESTMENTS (Unaudited)
 
Tax-Exempt Investments — 172.9%
 
                 
    Principal
       
    Amount
       
Security   (000’s omitted)     Value  
Education — 17.0%
               
California Educational Facilities Authority, (Claremont McKenna College), 5.00%, 1/1/39
  $ 1,370     $ 1,449,953  
California Educational Facilities Authority, (Harvey Mudd College), 5.25%, 12/1/31
    395       433,900  
California Educational Facilities Authority, (Harvey Mudd College), 5.25%, 12/1/36
    160       171,030  
California Educational Facilities Authority, (Loyola Marymount University), 5.00%, 10/1/22
    70       80,843  
California Educational Facilities Authority, (Loyola Marymount University), 5.00%, 10/1/23
    65       74,136  
California Educational Facilities Authority, (Loyola Marymount University), 5.00%, 10/1/30
    380       397,229  
California Educational Facilities Authority, (Santa Clara University), 5.00%, 2/1/29
    890       979,667  
California Educational Facilities Authority, (University of San Francisco), 6.125%, 10/1/36
    115       129,951  
California Educational Facilities Authority, (University of Southern California), 5.25%, 10/1/39
    1,200       1,310,544  
California Municipal Finance Authority, (University of San Diego), 5.00%, 10/1/31
    210       222,025  
California Municipal Finance Authority, (University of San Diego), 5.00%, 10/1/35
    145       150,372  
California Municipal Finance Authority, (University of San Diego), 5.25%, 10/1/26
    405       450,542  
California Municipal Finance Authority, (University of San Diego), 5.25%, 10/1/27
    425       466,268  
California Municipal Finance Authority, (University of San Diego), 5.25%, 10/1/28
    450       491,418  
University of California, 5.25%, 5/15/39
    1,000       1,095,480  
                 
            $ 7,903,358  
                 
Electric Utilities — 9.2%
               
California Department of Water Resources, Electric System Revenue, 5.00%, 5/1/22
  $ 480     $ 579,888  
Los Angeles Department of Water and Power, Electric System Revenue, 5.25%, 7/1/32
    745       817,742  
Puerto Rico Electric Power Authority, 5.25%, 7/1/29
    1,050       1,106,269  
Southern California Public Power Authority, (Tieton Hydropower), 5.00%, 7/1/30
    1,000       1,098,310  
Vernon, Electric System Revenue, 5.125%, 8/1/21
    675       689,641  
                 
            $ 4,291,850  
                 
General Obligations — 10.2%
               
California, 5.50%, 11/1/35
  $ 1,300     $ 1,418,092  
Palo Alto, (Election of 2008), 5.00%, 8/1/40(1)
    1,850       2,010,580  
San Diego Community College District, (Election of 2002), 5.00%, 8/1/32
    720       792,195  
San Diego Community College District, (Election of 2006), 5.00%, 8/1/31
    455       503,712  
                 
            $ 4,724,579  
                 
Hospital — 11.9%
               
California Health Facilities Financing Authority, (Catholic Healthcare West), 5.625%, 7/1/32
  $ 1,330     $ 1,387,403  
California Health Facilities Financing Authority, (Cedars-Sinai Medical Center), 5.00%, 8/15/39
    1,425       1,439,763  
California Statewide Communities Development Authority, (Cottage Health System), 5.25%, 11/1/30
    1,000       1,051,520  
California Statewide Communities Development Authority, (John Muir Health), 5.00%, 8/15/36
    355       358,848  
Washington Township Health Care District, 5.00%, 7/1/32
    555       558,580  
Washington Township Health Care District, 5.25%, 7/1/29
    750       750,195  
                 
            $ 5,546,309  
                 
Insured-Education — 13.2%
               
California Educational Facilities Authority, (Pepperdine University), (AMBAC), 5.00%, 12/1/32
  $ 420     $ 446,292  
California Educational Facilities Authority, (Pepperdine University), (AMBAC), 5.00%, 12/1/35
    1,000       1,058,560  
California Educational Facilities Authority, (Pepperdine University), (FGIC), (NPFG), 5.00%, 9/1/33
    180       183,627  
California State University, (AGM), (BHAC), 5.00%, 11/1/39(2)
    2,000       2,087,520  
California State University, (AMBAC), 5.00%, 11/1/33
    2,335       2,360,311  
                 
            $ 6,136,310  
                 
 
1


 

                 
    Principal
       
    Amount
       
Security   (000’s omitted)     Value  
Insured-Electric Utilities — 9.2%
               
Glendale, Electric System Revenue, (NPFG), 5.00%, 2/1/32
  $ 1,475     $ 1,517,303  
Los Angeles Department of Water and Power, Electric System Revenue, (AMBAC), (BHAC), 5.00%, 7/1/26(2)
    1,500       1,652,340  
Sacramento Municipal Utility District, (AGM), 5.00%, 8/15/27
    1,000       1,093,230  
                 
            $ 4,262,873  
                 
Insured-Escrowed/Prerefunded — 12.6%
               
California Infrastructure & Economic Development Bank, (Bay Area Toll Bridges), (AMBAC), Prerefunded to 1/1/28, 5.00%, 7/1/33
  $ 1,150     $ 1,468,516  
California Infrastructure & Economic Development Bank, (Bay Area Toll Bridges), (AMBAC), Prerefunded to 1/1/28, 5.00%, 7/1/36
    1,025       1,308,894  
Clovis Unified School District, (FGIC), (NPFG), Escrowed to Maturity, 0.00%, 8/1/20
    3,130       2,619,841  
Orange County Water District, Certificates of Participation, (NPFG), Escrowed to Maturity, 5.00%, 8/15/34
    395       456,130  
                 
            $ 5,853,381  
                 
Insured-General Obligations — 25.6%
               
Antelope Valley Community College District, (Election of 2004), (NPFG), 5.25%, 8/1/39
  $ 725     $ 766,782  
Arcadia Unified School District, (Election of 2006), (AGM), 0.00%, 8/1/38
    7,125       1,471,811  
Arcadia Unified School District, (Election of 2006), (AGM), 0.00%, 8/1/40
    2,525       460,661  
Carlsbad Unified School District, (Election of 2006), (NPFG), 5.25%, 8/1/32
    1,500       1,622,220  
Coast Community College District, (Election of 2002), (AGM), 0.00%, 8/1/35
    6,675       1,664,077  
El Camino Hospital District, (NPFG), 4.45%, 8/1/36
    575       576,875  
Long Beach Unified School District, (Election of 1999), (AGM), 5.00%, 8/1/31
    925       927,488  
Palm Springs Unified School District, (Election of 2008), (AGC), 5.00%, 8/1/33
    1,250       1,346,738  
Riverside Community College District, (Election of 2004), (AGM), (NPFG), 5.00%, 8/1/32
    1,040       1,096,628  
Union Elementary School District, (Election of 1999), (FGIC), (NPFG), 0.00%, 9/1/22
    3,200       1,981,088  
                 
            $ 11,914,368  
                 
Insured-Hospital — 6.5%
               
California Statewide Communities Development Authority, (Kaiser Permanente), (BHAC), 5.00%, 3/1/41(2)
  $ 1,250     $ 1,267,512  
California Statewide Communities Development Authority, (Sutter Health), (AGM), 5.05%, 8/15/38(2)
    1,750       1,780,940  
                 
            $ 3,048,452  
                 
Insured-Lease Revenue/Certificates of Participation — 9.8%
               
Puerto Rico Public Finance Corp., (AMBAC), Escrowed to Maturity, 5.50%, 8/1/27
  $ 1,250     $ 1,648,700  
San Diego County Water Authority, Certificates of Participation, (AGM), 5.00%, 5/1/38(2)
    1,750       1,837,500  
San Jose Financing Authority, (Civic Center), (AMBAC), 5.00%, 6/1/32
    1,075       1,078,182  
                 
            $ 4,564,382  
                 
Insured-Special Tax Revenue — 11.5%
               
Cathedral City Public Financing Authority, (Housing Redevelopment), (NPFG), 5.00%, 8/1/33
  $ 1,400     $ 1,348,928  
Hesperia Public Financing Authority, (Redevelopment and Housing Projects), (XLCA), 5.00%, 9/1/37
    1,535       1,026,301  
Los Angeles County Metropolitan Transportation Authority, (Sales Tax Revenue), (AGM), 4.50%, 7/1/27
    430       452,437  
Puerto Rico Sales Tax Financing Corp., (AMBAC), 0.00%, 8/1/54
    11,385       798,886  
Puerto Rico Sales Tax Financing Corp., (NPFG), 0.00%, 8/1/45
    3,215       415,603  
Santa Clara Valley Transportation Authority, Sales Tax Revenue, (AMBAC), 5.00%, 4/1/32
    1,225       1,294,029  
                 
            $ 5,336,184  
                 
Insured-Transportation — 3.1%
               
San Joaquin Hills Transportation Corridor Agency, (NPFG), 0.00%, 1/15/27
  $ 3,520     $ 1,109,469  
San Jose, Airport Revenue, (AMBAC), 5.00%, 3/1/33
    330       333,795  
                 
            $ 1,443,264  
                 
Insured-Water and Sewer — 10.3%
               
Calleguas Las Virgines Public Financing Authority, (Municipal Water District), (BHAC), (FGIC), 4.75%, 7/1/37
  $ 1,235     $ 1,271,544  
 
2


 

                 
    Principal
       
    Amount
       
Security   (000’s omitted)     Value  
East Bay Municipal Utility District, Water System Revenue, (AGM), (FGIC), 5.00%, 6/1/32
  $ 100     $ 108,396  
East Bay Municipal Utility District, Water System Revenue, (FGIC), (NPFG),
5.00%, 6/1/32(2)
    1,600       1,734,336  
Los Angeles Department of Water and Power, (NPFG), 3.00%, 7/1/30
    620       561,063  
Riverside, Water System Revenue, (AGM), 5.00%, 10/1/38
    445       470,405  
Santa Clara Valley Water District, (AGM), 3.75%, 6/1/28
    665       669,189  
                 
            $ 4,814,933  
                 
Special Tax Revenue — 6.7%
               
Los Angeles County Metropolitan Transportation Authority, Sales Tax Revenue, 5.00%, 7/1/31
  $ 1,490     $ 1,631,222  
San Francisco Bay Area Rapid Transit District, Sales Tax Revenue, 5.00%, 7/1/28
    1,300       1,476,618  
                 
            $ 3,107,840  
                 
Transportation — 13.7%
               
Bay Area Toll Authority, Toll Bridge Revenue, (San Francisco Bay Area), 5.25%, 4/1/29
  $ 1,190     $ 1,324,327  
Long Beach, Harbor Revenue, 5.00%, 5/15/27
    540       610,260  
Los Angeles Harbor Department, 5.00%, 8/1/25
    1,250       1,469,200  
Los Angeles Department of Airports, (Los Angeles International Airport),
5.00%, 5/15/35(2)(3)
    1,060       1,139,839  
San Francisco City and County Airport Commission, (San Francisco International Airport), 5.00%, 5/1/35
    635       664,242  
San Jose, Airport Revenue, 5.00%, 3/1/20
    1,000       1,154,880  
                 
            $ 6,362,748  
                 
Water and Sewer — 2.4%
               
Metropolitan Water District of Southern California, (Waterworks Revenue Authorization), 5.00%, 1/1/39
  $ 1,050     $ 1,133,864  
                 
            $ 1,133,864  
                 
                 
Total Tax-Exempt Investments — 172.9%
(identified cost $78,301,819)
          $ 80,444,695  
                 
                 
Auction Preferred Shares Plus Cumulative Unpaid Dividends — (55.2)%
          $ (25,700,323 )
                 
                 
Other Assets, Less Liabilities — (17.7)%
          $ (8,210,802 )
                 
                 
Net Assets Applicable to Common Shares — 100.0%
          $ 46,533,570  
                 
 
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, 2011, 58.9% 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 ranged from 1.3% to 19.9% of total investments.    
         
(1)
      Security (or a portion thereof) has been pledged to cover margin requirements on open financial futures contracts.
         
(2)
      Security represents the municipal bond held by a trust that issues residual interest bonds.
         
(3)
      Security (or a portion thereof) has been pledged as collateral for residual interest bond transactions. The aggregate value of such collateral is $344,839.
 
3


 

A summary of open financial instruments at December 31, 2011 is as follows:
 
Futures Contracts
 
                                 
Expiration
          Aggregate
          Net Unrealized
 
Month/Year   Contracts   Position   Cost     Value     Depreciation  
3/12
  25 U.S. 10-Year Treasury Note   Short   $ (3,240,384 )   $ (3,278,125 )   $ (37,741 )
3/12
  28 U.S. 30-Year Treasury Bond   Short     (3,992,579 )     (4,054,750 )     (62,171 )
                                 
                            $ (99,912 )
                                 
 
At December 31, 2011, 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 objectives. 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, 2011, 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 $99,912.
 
The cost and unrealized appreciation (depreciation) of investments of the Fund at December 31, 2011, as determined on a federal income tax basis, were as follows:
 
         
Aggregate cost
  $ 68,214,123  
         
Gross unrealized appreciation
  $ 4,892,940  
Gross unrealized depreciation
    (2,547,368 )
         
Net unrealized appreciation
  $ 2,345,572  
         
 
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 December 31, 2011, 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
  $     $ 80,444,695     $     $ 80,444,695  
 
 
Total Investments
  $     $ 80,444,695     $     $ 80,444,695  
 
 
                                 
Liability Description                        
   
Futures Contracts
  $ (99,912 )   $     $     $ (99,912 )
 
 
Total
  $ (99,912 )   $     $     $ (99,912 )
 
 
 
The Fund held no investments or other financial instruments as of September 30, 2011 whose fair value was determined using Level 3 inputs. At December 31, 2011, the value of investments transferred between Level 1 and Level 2, if any, during the fiscal year to date then ended was not significant.
 
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.
 
 
4


 

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/ Cynthia J. Clemson
 
   
 
  Cynthia J. Clemson    
 
  President    
 
       
Date:
  February 23, 2012    
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/ Cynthia J. Clemson
 
   
 
  Cynthia J. Clemson    
 
  President    
 
       
Date:
  February 23, 2012    
 
       
By:
  /s/ Barbara E. Campbell
 
   
 
  Barbara E. Campbell    
 
  Treasurer    
 
       
Date:
  February 23, 2012