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, 2016

Date of Reporting Period

 

 

 

Item 1. Schedule of Investments

Eaton Vance

California Municipal Bond Fund II

June 30, 2016

PORTFOLIO OF INVESTMENTS (Unaudited)

Tax-Exempt Investments — 153.3%

 

                                                 
Security    Principal
Amount
(000’s omitted)		      Value  

Education — 12.7%

      

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

    $ 395       $ 472,140   

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

      160         191,246   

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

      70         83,757   

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

      380         426,637   

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

      890         1,004,614   

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

      115         142,637   

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

      1,200         1,320,456   

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

      330         386,575   

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

      210         246,901   

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

      145         170,720   

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

      405         487,219   

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

      425         507,875   

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

      450         534,236   

University of California, Prerefunded to 5/15/19, 5.25%, 5/15/39

      165         186,331   

University of California, Prerefunded to 5/15/19, 5.25%, 5/15/39

      550         619,306   
     

 

 

  
   $ 6,780,650   
     

 

 

  

Electric Utilities — 5.9%

      

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

    $ 745       $ 814,412   

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

      420         510,657   

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

      125         151,571   

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

      1,000         1,151,260   

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

      470         525,845   
     

 

 

  
   $ 3,153,745   
     

 

 

  

Escrowed/Prerefunded — 3.9%

      

California Educational Facilities Authority, (Claremont McKenna College), Prerefunded to 1/1/19, 5.00%, 1/1/39

    $ 1,370       $ 1,517,521   

University of California, Prerefunded to 5/15/19, 5.25%, 5/15/39

      285         321,845   

Vernon, Electric System Revenue, Prerefunded to 8/1/19, 5.125%, 8/1/21

      205         223,864   
     

 

 

  
   $ 2,063,230   
     

 

 

  

General Obligations — 28.6%

      

California, 5.00%, 10/1/31

    $ 565       $ 715,443   

California, 5.50%, 11/1/35

      1,300         1,557,413   

Mountain View Whisman School District, (Election of 2012), 4.00%, 9/1/42(1)

      2,000         2,300,820   

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

      1,850         2,137,028   

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

      1,510         1,716,070   

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

      720         846,072   

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

      455         535,894   

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

      410         495,378   

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

      685         863,648   

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

      1,170         1,468,736   

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

      1,125         1,390,455   

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

      1,000         1,254,140   
     

 

 

  
   $ 15,281,097   
     

 

 

  

 

1

 

 

                                                 
Security    Principal
Amount
(000’s omitted)		      Value  

Hospital — 11.7%

      

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

    $ 1,400       $ 1,573,236   

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

      335         404,553   

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

      475         571,064   

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

      750         912,975   

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

      600         726,672   

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

      280         335,849   

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

      1,000         1,158,890   

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

      555         572,260   
     

 

 

  
   $ 6,255,499   
     

 

 

  

Insured-Electric Utilities — 4.1%

      

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

    $ 1,035       $ 1,068,337   

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

      1,000         1,090,840   
     

 

 

  
   $ 2,159,177   
     

 

 

  

Insured-Escrowed/Prerefunded — 28.0%

      

Antelope Valley Community College District, (Election of 2004), (NPFG), Prerefunded to 8/1/17, 5.25%, 8/1/39

    $ 725       $ 762,454   

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

      1,150         1,573,062   

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

      525         718,137   

Carlsbad Unified School District, (Election of 2006), (NPFG), Prerefunded to 8/1/17, 5.25%, 8/1/32

      1,500         1,577,325   

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

      3,130         3,007,711   

Coast Community College District, (Election of 2002), (AGM), Prerefunded to 8/1/16, 0.00%, 8/1/35

      6,675         2,384,243   

East Bay Municipal Utility District, Water System Revenue, (AGM), (FGIC), Prerefunded to 6/1/17, 5.00%, 6/1/32

      100         104,148   

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

      395         545,858   

Riverside Community College District, (Election of 2004), (AGM), (NPFG), Prerefunded to 8/1/17, 5.00%, 8/1/32

      1,040         1,090,918   

San Diego County Water Authority, Certificates of Participation, (AGM), Prerefunded to 5/1/18, 5.00%, 5/1/38(1)

      1,750         1,891,680   

Santa Clara Valley Transportation Authority, Sales Tax Revenue, (AMBAC), Prerefunded to 4/1/17, 5.00%, 4/1/32

      1,225         1,266,454   
     

 

 

  
   $ 14,921,990   
     

 

 

  

Insured-General Obligations — 15.3%

      

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

    $ 7,125       $ 2,454,278   

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

      2,525         788,734   

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

      575         586,132   

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

      1,250         1,415,575   

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

      3,200         2,897,664   
     

 

 

  
   $ 8,142,383   
     

 

 

  

Insured-Hospital — 3.5%

      

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

    $ 1,750       $ 1,873,340   
     

 

 

  
      $ 1,873,340   
     

 

 

  

 

2

 

 

                                                 
Security    Principal
Amount
(000’s omitted)		      Value  

Insured-Special Tax Revenue — 7.1%

      

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

    $ 1,535       $ 1,564,979   

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

      2,675         487,706   

Successor Agency to Hawthorne Community Redevelopment Agency, (AGM), 5.00%, 9/1/34

      1,400         1,733,032   
     

 

 

  
      $ 3,785,717   
     

 

 

  

Insured-Transportation — 5.4%

      

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

    $ 3,520       $ 2,542,461   

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

      330         339,161   
     

 

 

  
      $ 2,881,622   
     

 

 

  

Insured-Water and Sewer — 0.9%

      

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

    $ 445       $ 487,400   
     

 

 

  
      $ 487,400   
     

 

 

  

Lease Revenue/Certificates of Participation — 1.1%

      

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

    $ 480       $ 583,267   
     

 

 

  
      $ 583,267   
     

 

 

  

Special Tax Revenue — 7.0%

      

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

    $ 1,490       $ 1,610,213   

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

      1,300         1,494,974   

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

      500         617,755   
     

 

 

  
      $ 3,722,942   
     

 

 

  

Transportation — 11.2%

      

Bay Area Toll Authority, Toll Bridge Revenue, (San Francisco Bay Area), Prerefunded to 4/1/19, 5.25%, 4/1/29

    $ 1,190       $ 1,338,572   

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

      540         627,653   

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

      1,060         1,215,173   

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

      1,250         1,507,163   

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

      635         722,293   

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

      500         572,140   
     

 

 

  
      $ 5,982,994   
     

 

 

  

Water and Sewer — 6.9%

      

Los Angeles, Wastewater System Revenue, 5.00%, 6/1/34

    $ 2,000       $ 2,519,540   

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

      1,050         1,161,825   
     

 

 

  
      $ 3,681,365   
     

 

 

  

Total Tax-Exempt Investments — 153.3%
(identified cost $73,160,553)

       $ 81,756,418   
     

 

 

  

Auction Preferred Shares Plus Cumulative Unpaid Dividends — (1.7)%

       $ (900,019 ) 
     

 

 

  

Institutional MuniFund Term Preferred Shares, at Liquidation Value — (46.5)%

       $ (24,800,000 ) 
     

 

 

  

Other Assets, Less Liabilities — (5.1)%

       $ (2,706,413 ) 
     

 

 

  

Net Assets Applicable to Common Shares — 100.0%

       $ 53,349,986   
     

 

 

  

 

3

 

 

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

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, 2016, 41.9% 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 or financial guaranty assurance agency ranged from 0.1% to 17.8% 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 $420,173.

Futures Contracts

 

Description

    Contracts    Position      Expiration
Month/Year		      Aggregate Cost     Value     Net Unrealized
Depreciation		  

Interest Rate Futures

                
U.S. 10-Year Treasury Note    15      Short         Sep-16       $     (1,941,888 )    $     (1,994,766 )    $ (52,878 ) 
U.S. Long Treasury Bond    15      Short         Sep-16         (2,440,087 )      (2,585,156 )      (145,069 ) 
               

 

 

  
  $     (197,947 ) 
               

 

 

  

Abbreviations:

 

AGC

   -   Assured Guaranty Corp.

AGM

   -   Assured Guaranty Municipal Corp.

AMBAC

   -   AMBAC Financial Group, Inc.

FGIC

   -   Financial Guaranty Insurance Company

NPFG

   -   National Public Finance Guaranty Corp.

XLCA

   -   XL Capital Assurance, Inc.

At June 30, 2016, the Fund had sufficient cash and/or securities to cover commitments under open derivative 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 enters into U.S. Treasury futures contracts to hedge against changes in interest rates.

At June 30, 2016, 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 $197,947.

The cost and unrealized appreciation (depreciation) of investments of the Fund at June 30, 2016, as determined on a federal income tax basis, were as follows:

 

Aggregate cost

    $     67,307,752   
  

 

 

  

Gross unrealized appreciation

    $ 8,939,933   

Gross unrealized depreciation

      (141,267 ) 
  

 

 

  

Net unrealized appreciation

    $ 8,798,666   
  

 

 

  

 

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, 2016, 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

    $ —       $ 81,756,418       $ —       $ 81,756,418   

Total Investments

    $ —       $     81,756,418       $     —       $     81,756,418   
Liability Description                                

Futures Contracts

    $ (197,947 )     $ —       $ —       $ (197,947 ) 

Total

    $     (197,947 )     $ —       $ —       $ (197,947 ) 

The Fund held no investments or other financial instruments as of September 30, 2015 whose fair value was determined using Level 3 inputs. At June 30, 2016, 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 22, 2016

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 22, 2016

 

By:   /s/ James F. Kirchner
  James F. Kirchner
  Treasurer
Date:   August 22, 2016