Investment Company Act file number 811-10525
Nuveen North Carolina Dividend Advantage Municipal Fund 2
(Exact name of registrant as specified in charter)
333 West Wacker Drive, Chicago, Illinois, 60606
Address of principal executive offices) (Zip code)
Jessica R. DroegerVice President and Secretary
333 West Wacker Drive, Chicago, Illinois, 60606
(Name and address of agent for service)
Registrant's telephone number, including area code: 312-917-7700
Date of fiscal year end: 05/31
Date of reporting period: 08/31/04
Form N-Q is to be used by management investment companies, other than small business investment companies registered on Form N-5 (§§ 239.24 and 274.5 of this chapter), to file reports with the Commission, not later than 60 days after the close of the first and third fiscal quarters, pursuant to rule 30b1-5 under the Investment Company Act of 1940 (17 CFR 270.30b1-5). The Commission may use the information provided on Form N-Q in its regulatory, disclosure review, inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-Q, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-Q unless the Form displays a currently valid Office of Management and Budget (OMB) control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to the Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. § 3507.
Item 1. Schedule of Investments
Portfolio of Investments (Unaudited)
Nuveen North Carolina Dividend Advantage Municipal Fund 2 (NNO)
August 31, 2004
Principal |
Optional Call |
Market |
||||
---|---|---|---|---|---|---|
Amount (000) |
Description(1) |
Provisions* |
Ratings** |
Value |
||
Education and Civic Organizations - 21.6% |
||||||
|
||||||
Appalachian State University, North Carolina, Housing and Student Center System Revenue Refunding |
||||||
Bonds, Series 2001: |
||||||
$ | 600 |
5.125%, 7/15/24 |
1/11 at 101.00 |
Aaa |
$ 626,220 |
|
200 |
5.125%, 7/15/27 |
1/11 at 101.00 |
Aaa |
206,718 |
||
Appalachian State University, North Carolina, Housing and Student Center System Revenue Refunding |
||||||
Bonds, Series 2002: |
||||||
1,040 |
5.000%, 7/15/14 - MBIA Insured |
7/12 at 100.00 |
Aaa |
1,142,887 |
||
1,000 |
5.000%, 7/15/15 - MBIA Insured |
7/12 at 100.00 |
Aaa |
1,081,300 |
||
500 |
East Carolina University, North Carolina, General Revenue Bonds, Series 2003A, 5.000%, 5/01/19 - |
|||||
AMBAC Insured |
5/13 at 100.00 |
Aaa |
534,210 |
|||
3,750 |
North Carolina Capital Facilities Financing Agency, Revenue Bonds, Duke University, Series 2001A, |
10/11 at 100.00 |
AA+ |
3,876,413 |
||
5.125%, 10/01/26 |
||||||
1,840 |
University of North Carolina, Chapel Hill, General Revenue Bonds, Series 2002B, 5.000%, |
No Opt. Call |
AA+ |
2,054,342 |
||
12/01/11 |
||||||
400 |
University of North Carolina, Greensboro, General Revenue Refunding Bonds, Series 2002B, 5.375%, |
4/11 at 101.00 |
AAA |
444,808 |
||
4/01/17 - FSA Insured |
||||||
University of North Carolina System, Pooled Revenue Refunding Bonds, Series 2002A: |
||||||
1,155 |
5.375%, 4/01/16 - AMBAC Insured |
10/12 at 100.00 |
AAA |
1,287,952 |
||
1,100 |
5.375%, 4/01/19 - AMBAC Insured |
10/12 at 100.00 |
AAA |
1,216,105 |
||
Healthcare - 22.9% |
||||||
|
||||||
3,200 |
Charlotte-Mecklenburg Hospital Authority, North Carolina, Healthcare System Revenue Bonds, |
1/11 at 101.00 |
AA |
3,213,536 |
||
Carolinas Healthcare System, Series 2001A, 5.000%, 1/15/31 |
||||||
1,000 |
New Hanover County, North Carolina, Hospital Revenue Bonds, New Hanover Regional Medical Center, |
10/04 at 101.00 |
AAA |
1,002,630 |
||
Series 1993, 4.750%, 10/01/23 - AMBAC Insured |
||||||
1,005 |
North Carolina Medical Care Commission, Healthcare Facilities Revenue Bonds, Union Regional Medical |
1/12 at 100.00 |
A |
1,087,762 |
||
Center, Series 2002A, 5.250%, 1/01/13 |
||||||
2,000 |
North Carolina Medical Care Commission, Healthcare Facilities Revenue Bonds, Novant Health |
11/13 at 100.00 |
AA- |
2,086,540 |
||
Obligated Group, Series 2003A, 5.000%, 11/01/20 |
||||||
North Carolina Medical Care Commission, Revenue Bonds, Cleveland County Health Care System, |
||||||
Series 2004A: |
||||||
595 |
5.250%, 7/01/20 - AMBAC Insured |
7/14 at 100.00 |
AAA |
641,886 |
||
500 |
5.250%, 7/01/22 - AMBAC Insured |
7/14 at 100.00 |
AAA |
533,185 |
||
North Carolina Medical Care Commission, Hospital Revenue Bonds, Southeastern Regional Medical |
||||||
Center, Series 2002: |
||||||
1,000 |
5.500%, 6/01/15 |
6/12 at 101.00 |
A |
1,084,190 |
||
2,000 |
5.250%, 6/01/22 |
6/12 at 101.00 |
A |
2,043,600 |
||
500 |
North Carolina Medical Care Commission, Revenue Bonds, Northeast Medical Center, Series 2004, |
11/14 at 100.00 |
AA- |
512,795 |
||
5.000%, 11/01/24 |
||||||
1,000 |
North Carolina Medical Care Commission, Health System Revenue Bonds, Mission-St. Joseph's Health |
10/11 at 101.00 |
AA |
1,024,430 |
||
System, Series 2001, 5.250%, 10/01/31 |
||||||
Housing/Multifamily - 6.4% |
||||||
|
||||||
3,500 |
Mecklenburg County, North Carolina, FNMA Multifamily Housing Revenue Bonds, Sycamore Green |
1/12 at 102.00 |
AAA |
3,678,920 |
||
Apartments, Series 2001, 5.500%, 1/15/35 (Alternative Minimum Tax) - FGIC Insured |
||||||
Housing/Single Family - 4.0% |
||||||
|
||||||
425 |
North Carolina Housing Finance Agency, Home Ownership Revenue Bonds, 1998 Trust Agreement, |
7/10 at 100.00 |
AAA |
432,986 |
||
Series 10A, 5.400%, 7/01/32 (Alternative Minimum Tax) - AMBAC Insured |
||||||
North Carolina Housing Finance Agency, Home Ownership Revenue Bonds, Series 13A: |
||||||
885 |
4.700%, 7/01/12 (Alternative Minimum Tax) |
7/11 at 100.00 |
AA |
932,657 |
||
885 |
4.850%, 7/01/13 (Alternative Minimum Tax) |
7/11 at 100.00 |
AA |
932,949 |
||
Industrials - 1.4% |
||||||
|
||||||
800 |
North Carolina Capital Facilities Financing Agency, Exempt Facilities Revenue Bonds, Waste |
No Opt. Call |
BBB |
810,872 |
||
Management Inc., Series 2001, 3.750%, 8/01/14 (Alternative Minimum Tax) (Mandatory put 8/01/07) |
||||||
Materials - 2.0% |
||||||
|
||||||
1,100 |
Northhampton County Industrial Facilities and Pollution Control Financing Authority, North |
2/11 at 101.00 |
BBB |
1,150,985 |
||
Carolina, Environmental Improvement Revenue Bonds, International Paper Company, Series 2001A, |
||||||
6.200%, 2/01/25 (Alternative Minimum Tax) |
||||||
Tax Obligation/General - 14.3% |
||||||
|
||||||
250 |
Durham County, North Carolina, General Obligation Bonds, Series 2000, 5.600%, 5/01/15 |
5/10 at 102.00 |
AAA |
285,723 |
||
3,000 |
North Carolina, General Obligation Bonds, Series 2000A, 5.100%, 9/01/16 |
9/10 at 102.00 |
AAA |
3,298,410 |
||
1,000 |
North Carolina, General Obligation Bonds, Series 2004A, 5.000%, 3/01/22 |
3/14 at 100.00 |
AAA |
1,062,540 |
||
3,200 |
Wake County, North Carolina, General Obligation School Bonds, Series 2000, 5.400%, 2/01/13 |
2/10 at 101.50 |
AAA |
3,631,392 |
||
Tax Obligation/Limited - 29.2% |
||||||
|
||||||
1,330 |
Cabarrus County, North Carolina, Certificates of Participation, Series 2002, 5.250%, 2/01/16 |
2/13 at 100.00 |
AA- |
1,462,229 |
||
Charlotte, North Carolina, Storm Water Fee Revenue Bonds, Series 2002: |
||||||
1,850 |
5.250%, 6/01/18 |
6/12 at 101.00 |
AA+ |
2,029,912 |
||
400 |
5.250%, 6/01/19 |
6/12 at 101.00 |
AA+ |
437,216 |
||
1,325 |
Dare County, North Carolina, Certificates of Participation, Series 2002, 5.250%, 6/01/17 - AMBAC |
12/12 at 100.00 |
AAA |
1,459,011 |
||
Insured |
||||||
Hartnett County, North Carolina, Certificates of Participation, Series 2002: |
||||||
1,000 |
5.250%, 12/01/15 - FSA Insured |
12/12 at 101.00 |
AAA |
1,111,010 |
||
2,025 |
5.375%, 12/01/16 - FSA Insured |
12/12 at 101.00 |
AAA |
2,263,019 |
||
825 |
5.000%, 12/01/18 - FSA Insured |
12/12 at 101.00 |
AAA |
885,242 |
||
Lee County, North Carolina, Certificates of Participation, Public Schools and Community College, |
||||||
Series 2004: |
||||||
1,615 |
5.000%, 4/01/16 - FSA Insured |
4/14 at 100.00 |
AAA |
1,756,539 |
||
715 |
5.250%, 4/01/20 - FSA Insured |
4/14 at 100.00 |
AAA |
779,300 |
||
Raleigh, North Carolina, Certificates of Participation, Downtown Improvement, Series 2004B: |
||||||
805 |
5.000%, 6/01/20 (WI, settling 9/01/04) |
6/14 at 100.00 |
AA+ |
858,363 |
||
1,310 |
5.000%, 6/01/21 (WI, settling 9/01/04) |
6/14 at 100.00 |
AA+ |
1,387,133 |
||
1,000 |
Randolph County, North Carolina, Certificates of Participation, Series 2004, 5.000%, 6/01/20 - FSA |
6/14 at 102.00 |
AAA |
1,073,050 |
||
Insured |
||||||
1,285 |
Rockingham, North Carolina, Certificates of Participation, Series 2002, 5.000%, 4/01/18 - AMBAC |
4/12 at 101.00 |
AAA |
1,373,202 |
||
Insured |
||||||
Transportation - 12.5% |
||||||
|
||||||
Raleigh-Durham Airport Authority, North Carolina, Airport Revenue Bonds, Series 2001A: |
||||||
1,000 |
5.250%, 11/01/15 - FGIC Insured |
5/11 at 101.00 |
Aaa |
1,086,870 |
||
2,320 |
5.250%, 11/01/16 - FGIC Insured |
5/11 at 101.00 |
Aaa |
2,510,170 |
||
2,230 |
5.250%, 11/01/17 - FGIC Insured |
5/11 at 101.00 |
Aaa |
2,403,271 |
||
University of North Carolina, Charlotte, Parking System Revenue Bonds, Series 2002: |
||||||
360 |
5.000%, 1/01/17 - MBIA Insured |
1/12 at 101.00 |
Aaa |
388,098 |
||
270 |
5.000%, 1/01/20 - MBIA Insured |
1/12 at 101.00 |
Aaa |
286,502 |
||
500 |
5.125%, 1/01/27 - MBIA Insured |
1/12 at 101.00 |
Aaa |
519,300 |
||
U.S. Guaranteed*** - 5.6% |
||||||
|
||||||
3,000 |
Fayetteville Public Works Commission, North Carolina, Revenue Bonds, Series 1997, 5.125%, 3/01/24 |
3/07 at 101.00 |
AAA |
3,256,740 |
||
(Pre-refunded to 3/01/07) - FSA Insured |
||||||
Utilities - 12.1% |
||||||
|
||||||
2,500 |
North Carolina Eastern Municipal Power Agency, Power System Revenue Refunding Bonds, Series 1993B, |
1/05 at 100.00 |
AAA |
2,507,450 |
||
5.500%, 1/01/17 - FGIC Insured |
||||||
1,500 |
North Carolina Municipal Power Agency 1, Catawba Electric Revenue Bonds, Series 1999B, 6.500%, 1/01/20 |
1/10 at 101.00 |
BBB+ |
1,665,735 |
||
2,600 |
Wake County Industrial Facilities and Pollution Control Financing Authority, North Carolina, |
2/12 at 101.00 |
A3 |
2,800,772 |
||
Revenue Refunding Bonds, Carolina Power and Light Company, Series 2002, 5.375%, 2/01/17 |
||||||
Water and Sewer - 15.0% |
||||||
|
||||||
2,520 |
Charlotte, North Carolina, Water and Sewer System Revenue Bonds, Series 2002, 5.250%, 7/01/13 |
No Opt. Call |
AAA |
2,867,886 |
||
1,000 |
Durham County, North Carolina, Enterprise System Revenue Bonds, Series 2002, 5.000%, 6/01/23 - |
6/13 at 100.00 |
AAA |
1,044,230 |
||
MBIA Insured |
||||||
1,465 |
Orange Water and Sewer Authority, North Carolina, Water and Sewerage System Revenue Bonds, Series |
7/11 at 101.00 |
AA+ |
1,551,990 |
||
2001, 5.000%, 7/01/20 |
||||||
Raleigh, North Carolina, Combined Enterprise System Revenue Bonds, Series 2004: |
||||||
1,000 |
5.000%, 3/01/21 |
3/14 at 100.00 |
AAA |
1,063,350 |
||
2,000 |
5.000%, 3/01/22 |
3/14 at 100.00 |
AAA |
2,112,240 |
||
$ | 79,180 |
Total Long-Term Investments (cost $80,653,425) - 147.0% |
84,858,773 |
|||
Short-Term Investments - 1.7% |
||||||
|
||||||
1,000 |
Puerto Rico Government Development Bank, Adjustable Refunding Bonds, Variable Rate Demand |
A-1 |
1,000,000 |
|||
Obligations, Series 1985, 1.250%, 12/01/15 - MBIA Insured |
||||||
$ | 1,000 |
Total Short-Term Investments (cost $1,000,000) |
1,000,000 |
|||
Total Investments (cost $81,653,425) - 148.7% |
85,858,773 |
|||||
Other Assets Less Liabilities - (0.2)% |
(120,975) |
|||||
Preferred Shares, at Liquidation Value - (48.5)% |
(28,000,000) |
|||||
Net Assets Applicable to Common Shares - 100% |
$57,737,798 |
|||||
(1) |
All percentages shown in the Portfolio of Investments are based on net assets applicable to Common |
||
shares. |
|||
* |
Optional Call Provisions: Dates (month and year) and prices of the earliest optional call or redemption. |
||
There may be other call provisions at varying prices at later dates. |
|||
** |
Ratings: Using the higher of Standard & Poor's or Moody's rating. |
||
*** |
Securities are backed by an escrow or trust containing sufficient U.S. Government or U.S. Government |
||
agency securities which ensures the timely payment of principal and interest. Such securities are |
|||
normally considered to be equivalent to AAA rated securities. |
|||
(WI) |
Security purchased on a when-issued basis. |
||
|
Security has a maturity of more than one year, but has variable rate and demand features which qualify it |
||
as a short-term security. The rate disclosed is that currently in effect. This rate changes periodically |
|||
based on market conditions or a specified market index. |
|||
Income Tax Information |
|||
The following information is presented on an income tax basis. Differences between amounts for financial |
|||
statement and federal income tax purposes are primarily due to timing differences in recognizing income |
|||
on taxable market discount securities and timing differences in recognizing certain gains and losses on |
|||
security transactions. |
|||
At August 31, 2004, the cost of investments was $81,649,578. |
|||
Gross unrealized appreciation and gross unrealized depreciation of investments at August 31, 2004, |
|||
were as follows: |
|||
Gross unrealized: |
|||
Appreciation |
$4,212,778 |
||
Depreciation |
(3,583) |
||
Net unrealized appreciation of investments |
$4,209,195 |
||
Item 2. Controls and Procedures.
Item 3. Exhibits.
File as exhibits as part of this Form a separate certification for each principal executive officer and principal financial officer of the registrant as required by Rule 30a-2(a) under the Act (17 CFR 270.30a-2(a)), exactly as set forth below: EX-99 CERT 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.
(Registrant) Nuveen North Carolina Dividend Advantage Municipal Fund 2
By (Signature and Title)* /s/ Jessica R. Droeger--Vice President and Secretary
Date 10/29/04
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 (Signature and Title)* /s/ Gifford R. Zimmerman--Chief Administrative Officer (Principal Executive Officer)
Date 10/29/04
By (Signature and Title)* /s/ Stephen D. Foy--Vice President and Controller (Principal Financial Officer)
Date 10/29/04
* Print the name and title of each signing officer under his or her signature.