UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-Q
QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED
MANAGEMENT INVESTMENT COMPANY
Investment Company Act file number 811-21129
---------------------------
FLAHERTY & CRUMRINE/CLAYMORE PREFERRED SECURITIES INCOME FUND INCORPORATED
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(Exact name of registrant as specified in charter)
301 E. Colorado Boulevard, Suite 720
PASADENA, CA 91101
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(Address of principal executive offices) (Zip code)
Donald F. Crumrine
Flaherty & Crumrine Inc.
301 E. Colorado Boulevard, Suite 720
PASADENA, CA 91101
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(Name and address of agent for service)
Registrant's telephone number, including area code: 626-795-7300
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Date of fiscal year end: NOVEMBER 30, 2004
--------------------------
Date of reporting period: AUGUST 31, 2004
-------------------------
Form N-Q is to be used by management investment companies, other than small
business investment companies registered on Form N-5 (ss.ss. 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. ss. 3507.
ITEM 1. SCHEDULE OF INVESTMENTS.
The Schedule of Investments is attached herewith.
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Flaherty & Crumrine/Claymore Preferred Securities Income Fund Incorporated
PORTFOLIO OF INVESTMENTS
AUGUST 31, 2004 (UNAUDITED)
--------------------------------------------------------------------------
SHARES/$ PAR VALUE
-------------- -------
PREFERRED SECURITIES -- 78.3%
BANKING -- 34.2%
------------------------------------------------------------------------------------------------------------------------
108,197 Abbey National Group, 7.375% Pfd. ................................................ $ 2,891,565**(1)
15,000 ABN AMRO Capital Fund Trust VII, 6.08% Pfd. ...................................... 367,200**(1)
ABN AMRO North America, Inc.:
2,015 6.46% Pfd., 144A**** ........................................................... 2,115,619*
12,301 6.59% Pfd., 144A**** ........................................................... 13,079,838*
$17,500,000 Astoria Capital Trust I, 9.75% 11/01/29 Capital Security, Series B ............... 21,944,037
19,500 BAC Capital Trust III, 7.00% Pfd. ................................................ 519,675
954,000 BAC Capital Trust IV, 5.875% Pfd. ................................................ 23,706,900
600 BAC Capital Trust V, 7.00% Pfd. .................................................. 15,894
$1,240,000 BankBoston Capital Trust I, 8.25% 12/15/26 Capital Security ...................... 1,412,459
$16,155,000 BankBoston Capital Trust II, 7.75% 12/15/26 Capital Security, Series B ........... 17,888,351
478,100 Bank of New York Capital V, 5.95% Pfd. ........................................... 11,847,318
7,000 Bank One Capital Trust I, 8.00% Pfd. ............................................. 177,170
51,000 Bank One Capital Trust VI, 7.20% Pfd. ............................................ 1,354,305
$500,000 BT Capital Trust B, 7.90% 01/15/27, Capital Security ............................. 558,582(1)
$5,000,000 Chase Capital I, 7.67% 12/01/26 Capital Security ................................. 5,460,175
62,900 Chase Capital VII, 7.00% Pfd., Series G .......................................... 1,590,741
421,250 Chase Capital XI, 5.875% Pfd. 06/15/33 ........................................... 10,202,675
18,800 Citigroup, Inc., 6.231% Pfd., Series H ........................................... 991,136*
105,000 Cobank, ACB, 7.00% Pfd., 144A**** ................................................ 5,687,325*
27,900 Comerica (Imperial) Capital Trust I, 7.60% Pfd. .................................. 748,278
$11,000,000 Cullen/Frost Capital Trust I, 8.42% 02/01/27 Capital Security, Series A .......... 12,468,170
$2,500,000 Dime Capital Trust I, 9.33% Capital Security, Series A ........................... 2,961,800
$5,600,000 First Chicago NBD Capital A, 7.95% 12/01/26 Capital Security, 144A**** ........... 6,224,260
$875,000 First Chicago NBD Capital B, 7.75%, 12/01/26 Capital Security, 144A**** .......... 963,458
$3,000,000 First Midwest Capital Trust I, 6.95% 12/01/33 Capital Security ................... 3,201,510
$3,500,000 First Tennessee Capital Trust II, 6.30% 04/15/34 Capital Security, Series B ...... 3,471,248
62,600 Fleet Capital Trust VII, 7.20% Pfd. .............................................. 1,672,359
86,500 Fleet Capital Trust VIII, 7.20% Pfd. ............................................. 2,321,228
2 FT Real Estate Securities Company, 9.50% Pfd., 144A**** .......................... 2,685,636
$500,000 Great Western Finance Trust II, 8.206% 02/01/27 Capital Security, Series A ....... 558,123
33,550,000 GreenPoint Capital Trust I, 9.10% 06/01/27 Capital Security ...................... 38,723,913
$23,725,000 HBOS Capital Funding LP, 6.85% Pfd. .............................................. 24,345,527(1)
6,300 Household Capital Trust VI, 8.25% Pfd. ........................................... 171,455
$12,497,000 J.P. Morgan Capital Trust I, 7.54% 01/15/27 Capital Security ..................... 13,617,169
$11,908,000 J.P. Morgan Capital Trust II, 7.95% 02/01/27 Capital Security .................... 13,313,501
4
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Flaherty & Crumrine/Claymore Preferred Securities Income Fund Incorporated
PORTFOLIO OF INVESTMENTS (CONTINUED)
AUGUST 31, 2004 (UNAUDITED)
--------------------------------------------------------------------------
SHARES/$ PAR VALUE
-------------- -------
PREFERRED SECURITIES -- (CONTINUED)
BANKING -- (CONTINUED)
------------------------------------------------------------------------------------------------------------------------
J.P. Morgan Chase & Co.:
15,000 6.625% Pfd., Series H .......................................................... $ 799,950*
118,758 Adj. Rate Pfd. ................................................................. 6,000,248*
300,241 Adj. Rate Pfd., Series A ....................................................... 27,622,172*
23,800 Keycorp Capital V, 5.875% Pfd., Series A ......................................... 573,342
$12,595,000 KeyCorp Institutional Capital A, 7.826% 12/01/26 Capital Security, Series A ...... 13,800,782
$4,000,000 Lloyds TSB Bank PLC, Tier I, 6.90% 10/22/49 ...................................... 4,156,720(1)
$25,280,000 Marshall & Ilsley Capital Trust A, 7.65% 12/01/26 Capital Security .............. 27,857,422
20 Marshall & Ilsley Investment II, 8.875% Pfd., 144A**** ........................... 2,221,765
$3,000,000 North Fork Capital Trust I, 8.70% 12/15/26 Capital Security ...................... 3,417,990
$13,750,000 RBS Capital Trust B, 6.80% Pfd. .................................................. 14,150,538**(1)
$15,600,000 Republic New York Capital I, 7.750% 11/15/26 Capital Security .................... 17,175,834(1)
$17,127,000 Republic New York Capital II, 7.53% 12/04/26 Capital Security .................... 18,691,209(1)
Roslyn Real Estate:
10 8.95% Pfd., Pvt., Series C, 144A**** ........................................... 1,056,359
30 Series D, Adj. Rate Pfd., 144A**** ............................................. 3,022,500
Royal Bank of Scotland Group PLC:
739,000 5.75% Pfd., Series B ........................................................... 17,639,930**(1)
80,000 6.40% Pfd., Series M ........................................................... 2,019,200**(1)
$14,167,000 Union Planters Capital Trust, 8.20% 12/15/26 Capital Security .................... 15,885,032
60 Union Planters Preferred Funding, 7.75% Pfd., Series 144A**** .................... 6,673,944
23,500 VNB Capital Trust I, 7.75% Pfd. .................................................. 620,165
$300,000 Wachovia Capital Trust V, 7.965% 06/01/27 Capital Security, 144A**** ............. 335,379
$2,217,200 Wachovia Preferred Funding, 7.25% Pfd., Series A ................................. 61,438,612
$20,750,000 Washington Mutual, Inc., 8.36% 12/01/26 Capital Security, 144A**** ............... 23,305,570
$8,000,000 Webster Capital Trust II, 10.00% 04/01/27 Capital Security ....................... 9,509,920
365,000 Wells Fargo Capital Trust VII, 5.85% Pfd. ........................................ 8,924,250
45,000 Wells Fargo Capital Trust IX, 5.625% Pfd. ........................................ 1,068,750
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537,226,183
----------------
FINANCIAL SERVICES -- 13.7%
------------------------------------------------------------------------------------------------------------------------
58,500 The Bear Stearns Companies Inc., 5.49% Pfd., Series G ............................ 2,798,640*
30,000 Corporate-Backed Trust Certificates, 7.75% Pfd., Series CIT ...................... 808,950
$15,459,000 Countrywide Capital I, 8.00% 12/15/26 Capital Security ........................... 16,654,444
1,030,200 Countrywide Capital IV, 6.75% Pfd. ............................................... 26,275,251
Fannie Mae:
680,420 5.10% Pfd., Series E ........................................................... 30,646,117*
96,300 5.125% Pfd. .................................................................... 4,396,577*
5
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Flaherty & Crumrine/Claymore Preferred Securities Income Fund Incorporated
PORTFOLIO OF INVESTMENTS (CONTINUED)
AUGUST 31, 2004 (UNAUDITED)
--------------------------------------------------------------------------
SHARES/$ PAR VALUE
-------------- -------
PREFERRED SECURITIES -- (CONTINUED)
FINANCIAL SERVICES -- (CONTINUED)
------------------------------------------------------------------------------------------------------------------------
68,600 Freddie Mac, 5.79% Pfd. .......................................................... $ 3,479,735*
483,052 General Electric Capital Corporation, 5.875% Pfd. ................................ 12,088,376
Lehman Brothers Holdings, Inc.:
295,000 5.67% Pfd., Series D ........................................................... 14,267,675*
25,000 5.94% Pfd., Series C ........................................................... 1,245,625*
1,569,750 6.50% Pfd., Series F ........................................................... 40,915,534*
570,000 Lehman Capital Trust III, 6.375% Pfd., Series K .................................. 14,398,200
138,975 Merrill Lynch Capital Trust V, 7.28% Pfd. ........................................ 3,750,935
10,000 Merrill Lynch Preferred Capital Trust IV, 7.12% Pfd. ............................. 268,700
64,300 Morgan Stanley Capital Trust II, 7.25% Pfd. ...................................... 1,690,126
1,074,900 Morgan Stanley Capital Trust III, 6.25% Pfd. ..................................... 26,818,755
202,000 Morgan Stanley Capital Trust IV, 6.25% Pfd. ...................................... 5,082,320
9,000 Morgan Stanley Capital Trust V, 5.75% Pfd. ....................................... 212,220
160,000 SLM Corporation, 6.97% Pfd., Series A ............................................ 8,982,400*
-------------------------------------------------------------------------------------------------------------------
214,780,580
----------------
INSURANCE -- 13.4%
------------------------------------------------------------------------------------------------------------------------
1,719,980 ACE Ltd., 7.80% Pfd., Series C ................................................... 46,293,262**(1)
$16,551,000 AON Capital Trust A, 8.205% 01/01/27 Capital Security ............................ 18,977,459
48,100 Corporate-Backed Trust Certificates, 8.00% Pfd., Series AON ...................... 1,242,423
106,000 Corts-AON Capital, 8.205% Pfd. ................................................... 2,849,810
37,000 Corts-UnumProvident Corporation, 8.50% Pfd. ...................................... 977,355
142,300 Everest Re Capital Trust II, 6.20% Pfd., Series B ................................ 3,393,143(1)
ING Groep NV:
36,000 7.05% Pfd. ..................................................................... 946,800**(1)
489,000 7.20% Pfd. ..................................................................... 13,017,180**(1)
$10,000,000 Mangrove Bay Passthru Trust, 6.102% 07/15/33 Capital Security, 144A**** .......... 10,206,450(1)
$2,200,000 MMI Capital Trust I, 7.625% 12/15/27 Capital Security, Series B .................. 2,385,548
270,989 PartnerRe Ltd., 6.75% Pfd., Series C ............................................. 6,824,858**(1)
$8,000,000 Provident Financing Trust I, 7.405% 03/15/38 Capital Security .................... 7,168,560
332,235 Renaissancere Holding, 7.30% Pfd., Series B ...................................... 8,761,037(1)
94,900 Saturns-AON 2003-3, 8.00% Pfd. Series AON ........................................ 2,513,426
56,000 Saturns-SAFC 2001-7, 8.25% Pfd., Series SAFC ..................................... 1,508,920
22,390 St. Paul Capital Trust I, 7.60% Pfd. ............................................. 592,216
$8,075,000 USF&G Capital, 8.312% 07/01/46 Capital Security, 144A**** ........................ 9,557,409
$16,750,000 USF&G Capital I, 8.50% 12/15/45 Capital Security, 144A**** ....................... 20,251,671
15,000 XL Capital Ltd., 7.625% Pfd., Series B ........................................... 408,825**(1)
6
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Flaherty & Crumrine/Claymore Preferred Securities Income Fund Incorporated
PORTFOLIO OF INVESTMENTS (CONTINUED)
AUGUST 31, 2004 (UNAUDITED)
--------------------------------------------------------------------------
SHARES/$ PAR VALUE
-------------- -------
PREFERRED SECURITIES -- (CONTINUED)
INSURANCE -- (CONTINUED)
------------------------------------------------------------------------------------------------------------------------
Zurich RegCaPS Funding Trust:
19,525 6.01% Pfd., 144A**** ........................................................... $ 19,827,638*
31,900 6.58% Pfd., 144A**** ........................................................... 33,052,547*
-------------------------------------------------------------------------------------------------------------------
210,756,537
----------------
UTILITIES -- 12.5%
------------------------------------------------------------------------------------------------------------------------
$3,750,000 AGL Capital Trust, 8.17% 06/01/37 Capital Security .............................. 4,201,462
275,000 Alabama Power Company, 5.30% Pfd. ................................................ 6,635,750*
6,146 Appalachian Power Company, 5.92% Sinking Fund Pfd. ............................... 618,042*
10,000 Baltimore Gas & Electric Company, 6.70% Pfd., Series 1993 ........................ 1,047,800*
50,000 Baltimore Gas & Electricity, 7.125% Pfd., Series 1993 ............................ 5,255,500*
35,000 Central Maine Power, 5.25% Pfd., Pvt. ............................................ 3,262,525*
$8,700,000 COMED Financing II, 8.50% 01/15/27 Capital Security, Series B .................... 9,886,071
$20,395,000 COMED Financing III, 6.35% 03/15/33 Capital Security ............................. 20,511,761
23,883 Delmarva Power & Light, 5.00% Pfd. ............................................... 2,310,083*
50,000 Dominion CNG Cap Trust I, 7.80% Pfd. ............................................. 1,335,000
$3,000,000 Dominion Resources Capital Trust I, 7.83% 12/01/27 Capital Security ............. 3,317,970
Duke Energy Corporation:
85,385 4.50% Pfd., Pvt., Series C ..................................................... 7,262,848*
59,662 7.04% Pfd., Series Y ........................................................... 6,161,891*
51,331 7.85% Pfd., Series S ........................................................... 5,324,308*
96,450 Duquesne Light Company, 6.50% Pfd. ............................................... 4,965,246*
67,700 Energy East Capital Trust I, 8.25% Pfd. .......................................... 1,803,190
Entergy Arkansas, Inc.:
10,240 4.56% Pfd., Series 1965 ........................................................ 804,762*
5,692 7.40% Pfd. ..................................................................... 592,680*
11,675 Entergy Louisiana, Inc., 8.00% Pfd., Series 92 ................................... 294,677*
105,000 Entergy Louisiana Capital I, 9.00% Pfd., Series A ................................ 2,709,000
Florida Power Company:
49,750 4.40% Pfd. ..................................................................... 4,125,768*
37,088 4.58% Pfd. ..................................................................... 3,217,013*
21,585 4.60% Pfd. ..................................................................... 1,871,420*
60,000 FPC Capital I, 7.10% Pfd., Series A .............................................. 1,510,200
12,442 Great Plains Energy, Inc., 4.20% Pfd. ............................................ 907,146*
5,000 Gulf Power Capital Trust III, 7.375% Pfd. ........................................ 132,725
$17,262,000 Houston Light & Power, Capital Trust II, 8.257%, 02/01/37 Capital Security ....... 18,227,982
7
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Flaherty & Crumrine/Claymore Preferred Securities Income Fund Incorporated
PORTFOLIO OF INVESTMENTS (CONTINUED)
AUGUST 31, 2004 (UNAUDITED)
--------------------------------------------------------------------------
SHARES/$ PAR VALUE
-------------- -------
PREFERRED SECURITIES -- (CONTINUED)
UTILITIES -- (CONTINUED)
------------------------------------------------------------------------------------------------------------------------
Indiana Michigan Power Company:
4,342 5.90% Sinking Fund Pfd. ........................................................ $ 432,745*
25,999 6.875% Sinking Fund Pfd. ....................................................... 2,591,190*
119,805 Indianapolis Power & Light Company, 5.65% Pfd. ................................... 10,833,367*
Interstate Power & Light Company:
110,000 7.10% Pfd., Series C ........................................................... 2,949,100*
11,000 8.375% Pfd., Series B .......................................................... 350,240*
15,017 Kentucky Energy Corp., 4.75% Pfd. ................................................ 1,297,093*
32,300 Laclede Capital Trust I, 7.70% Pfd. .............................................. 859,180
5,000 Northern Indiana Public Service Company, Adj. Rate Pfd., Series A ................ 257,625*
3,800 OGE Energy Capital Trust I, 8.375% Pfd. ........................................ 98,344
Pacific Enterprises:
4,550 $4.40 Pfd. ..................................................................... 369,164*
4,510 $4.50 Pfd. ..................................................................... 374,240*
23,085 $4.75 Pfd., Series 53 .......................................................... 2,022,015*
3,500 PacifiCorp, $7.48 Sinking Fund Pfd. .............................................. 366,310*
$2,337,000 PECO Energy Capital Trust III, 7.38% 04/06/28, Capital Security, Series D ........ 2,647,470
$17,000,000 PECO Energy Capital Trust IV, 5.75% 06/15/33 Capital Security .................... 15,996,320
13,061 Portland General Electric, 7.75% Sinking Fund Pfd. ............................... 1,357,169*
65,488 Potomac Electric Power Company, $3.40 Sinking Fund Pfd. .......................... 3,279,966*
215,750 PSEG Funding Trust II, 8.75% Pfd. ................................................ 5,942,834
19,646 Public Service Electric & Gas, 4.30% Pfd., Series C .............................. 1,534,156*
$6,000,000 Puget Capital Trust, 8.231% 06/01/27 Capital Security, Series B .................. 6,620,580
42,000 Savannah Electric & Gas Company, 6.00% Pfd. ...................................... 1,137,780*
160,000 Southern Union Company, 7.55% Pfd. ............................................... 4,378,400*
34,252 TXU US Holdings Company, $4.00 Pfd., Series TES .................................. 2,453,813*
$2,500,000 Union Electric Company, 7.69% 12/15/36 Capital Security, Series A ................ 2,769,125
Virginia Electric & Power Company:
14,985 $4.12 Pfd. ..................................................................... 1,216,183*
21,684 $4.80 Pfd. ..................................................................... 2,050,222*
78,700 Virginia Power Capital Trust, 7.375% Pfd. 07/30/42 ............................... 2,108,767
15,000 Wisconsin Power & Light Company, 6.20% Pfd. ...................................... 1,540,650*
Xcel Energy, Inc.:
7,110 $4.10 Pfd., Series C ........................................................... 520,310*
10,210 $4.11 Pfd., Series D ........................................................... 742,522*
-------------------------------------------------------------------------------------------------------------------
197,389,700
----------------
OIL AND GAS -- 1.9%
------------------------------------------------------------------------------------------------------------------------
13,200 EOG Resources, Inc., 7.195% Pfd., Series B ....................................... 14,449,578*
$13,315,000 Phillips 66 Capital Trust II, 8.00% 01/15/37 Capital Security .................... 15,121,246
-------------------------------------------------------------------------------------------------------------------
29,570,824
----------------
8
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Flaherty & Crumrine/Claymore Preferred Securities Income Fund Incorporated
PORTFOLIO OF INVESTMENTS (CONTINUED)
AUGUST 31, 2004 (UNAUDITED)
--------------------------------------------------------------------------
SHARES/$ PAR VALUE
-------------- -------
PREFERRED SECURITIES -- (CONTINUED)
REAL ESTATE INVESTMENT TRUST (REIT) -- 2.0%
------------------------------------------------------------------------------------------------------------------------
AMB Property Corporation:
54,405 6.50% Pfd., REIT, Series L ..................................................... $ 1,302,728
30,000 6.75% Pfd., REIT, Series M ..................................................... 740,700
160,000 BRE Properties, Inc., 6.75% Pfd., REIT, Series C ................................. 3,912,000
19,100 Equity Office Property Trust, 7.75% Pfd., REIT, Series G ......................... 509,970
51,000 Equity Residential Properties, 8.29% Pfd., REIT, Series K ........................ 3,125,025
Health Care Property Investment:
160,000 7.10% Pfd., REIT, Series F ..................................................... 4,056,800
25,000 7.25% Pfd., REIT, Series E ..................................................... 639,875
PS Business Parks, Inc.:
133,000 6.875% Pfd., REIT, Series I .................................................... 3,130,820
75,000 7.60% Pfd., REIT, Series L ..................................................... 1,901,250
60,000 7.95% Pfd., REIT, Series K ..................................................... 1,562,100
Public Storage, Inc.:
14,700 7.625% Pfd., REIT, Series U .................................................... 390,873
18,000 8.00% Pfd., REIT, Series R ..................................................... 483,570
232,000 Regency Centers Corporation, 7.25% Pfd., REIT .................................... 5,866,120
162,000 Weingarten Realty Investment, 6.95% Pfd., REIT ................................... 4,151,250
-------------------------------------------------------------------------------------------------------------------
31,773,081
----------------
MISCELLANEOUS INDUSTRIES -- 0.6%
------------------------------------------------------------------------------------------------------------------------
21,500 Delphi Trust I, 8.25% Pfd. ....................................................... 572,437
100,000 Ocean Spray Cranberries, Inc., 6.25% Pfd., 144A**** .............................. 8,315,000*
-------------------------------------------------------------------------------------------------------------------
8,887,437
----------------
TOTAL PREFERRED SECURITIES
(Cost $1,193,042,325) 1,230,384,342
----------------
CORPORATE DEBT SECURITIES -- 15.0%
BANKING -- 0.2%
------------------------------------------------------------------------------------------------------------------------
$2,500,000 Citigroup, Inc., 6.00% 10/31/33 .................................................. 2,528,675
-------------------------------------------------------------------------------------------------------------------
2,528,675
----------------
FINANCIAL SERVICES -- 2.8%
------------------------------------------------------------------------------------------------------------------------
47,000 Corp-Backed Trust Certificates, 5.80% Series Goldman Sachs ....................... 1,137,870
$25,000,000 General Motors Acceptance Corporation, 8.00% 11/01/31, Senior Bonds .............. 25,884,875
Lehman Brothers:
$5,000,000 Guaranteed Note, Variable Rate, 12/16/16, 144A**** ............................. 5,025,000
$9,593,000 Guaranteed Note, Variable Rate, 10/15/15, 144A**** ............................. 10,132,606
9
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Flaherty & Crumrine/Claymore Preferred Securities Income Fund Incorporated
PORTFOLIO OF INVESTMENTS (CONTINUED)
AUGUST 31, 2004 (UNAUDITED)
--------------------------------------------------------------------------
SHARES/$ PAR VALUE
-------------- -------
CORPORATE DEBT SECURITIES -- (CONTINUED)
FINANCIAL SERVICES -- (CONTINUED)
------------------------------------------------------------------------------------------------------------------------
$2,200,000 Morgan Stanley Finance, 8.03% 02/28/17, Capital Units ............................ $ 2,439,382
-------------------------------------------------------------------------------------------------------------------
44,619,733
----------------
INSURANCE -- 0.8%
------------------------------------------------------------------------------------------------------------------------
239,000 Delphi Financial, 8.00% 05/15/33, Senior Notes ................................... 6,344,255
$4,400,000 Oneamerica Financial Partners, 7.00% 10/15/33 144A**** ........................... 4,506,964
$1,000,000 UnumProvident Corporation, 7.25% 03/15/28, Senior Notes .......................... 950,785
-------------------------------------------------------------------------------------------------------------------
11,802,004
----------------
OIL AND GAS -- 0.4%
------------------------------------------------------------------------------------------------------------------------
238,261 Nexen, Inc., 7.35% Subordinated Notes ............................................ 6,190,021(1)
-------------------------------------------------------------------------------------------------------------------
6,190,021
----------------
UTILITIES -- 10.4%
------------------------------------------------------------------------------------------------------------------------
$32,000,000 AEP Texas Central Company, 6.65% 02/15/33, Senior Notes, Series E ................ 34,469,760
$19,000,000 Constellation Energy Group, 7.60% Pfd., 04/1/32, Senior Notes .................... 22,026,795
$1,000,000 DTE Energy Company, 6.375% 04/15/33, Senior Notes ................................ 1,004,995
Duke Capital Corporation:
$11,179,000 6.75% 02/15/32, Senior Notes ................................................... 11,701,842
$10,000,000 8.00% 10/01/19 Senior Notes .................................................... 11,804,550
$5,000,000 Entergy Gulf States, Inc., 6.20% 07/01/33, 1st Mortgage .......................... 4,929,300
16,500 Entergy Mississippi, Inc., 7.25%, 1st Mortgage ................................... 435,352
Georgia Power Company:
567,015 5.90% 04/15/33, Senior Notes ................................................... 14,141,354
125,000 6.00% 10/15/33, Senior Notes ................................................... 3,145,625
125,000 6.00% 08/15/44, Senior Notes ................................................... 3,165,000
$3,000,000 Indianapolis Power & Light Company, 6.60% 01/01/34, 1st Mortgage, 144A**** ....... 3,175,125
40,000 Northern States Power Company, 8.00% ............................................. 1,104,000
$10,000,000 Oncor Electric Delivery Company, 7.25% 01/15/33, Secured ......................... 11,652,750
$18,268,000 PSEG Power LLC, 8.625% 04/15/31 ................................................. 23,187,755
$10,250,000 TXU U.S. Holdings Company, 7.00% 03/15/13 ........................................ 11,516,029
$6,000,000 Wisconsin Electric Power Company, 6.875% 12/01/95 ................................ 6,675,360
-------------------------------------------------------------------------------------------------------------------
164,135,592
----------------
MISCELLANEOUS -- 0.4%
------------------------------------------------------------------------------------------------------------------------
$390,000 BellSouth Telecommunication, 7.00% 12/01/95 ...................................... 419,459
$5,000,000 Ford Motor Company, 7.45% 07/16/31 .............................................. 4,902,075
10
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Flaherty & Crumrine/Claymore Preferred Securities Income Fund Incorporated
PORTFOLIO OF INVESTMENTS (CONTINUED)
AUGUST 31, 2004 (UNAUDITED)
--------------------------------------------------------------------------
SHARES/$ PAR VALUE
-------------- -------
CORPORATE DEBT SECURITIES -- (CONTINUED)
MISCELLANEOUS -- (CONTINUED)
------------------------------------------------------------------------------------------------------------------------
30,000 Maytag Corporation, 7.875% 08/01/31 .............................................. $ 795,900
-------------------------------------------------------------------------------------------------------------------
6,117,434
----------------
TOTAL CORPORATE DEBT SECURITIES
(Cost $221,638,140) ............................................................ 235,393,459
----------------
COMMON STOCK AND CONVERTIBLE SECURITIES -- 4.1%
INSURANCE -- 0.2%
------------------------------------------------------------------------------------------------------------------------
20,000 Hartford Financial Services, 7.00% Mandatory Convertible, 08/16/06 ............... 1,208,300
45,000 UnumProvident Corporation, 8.25% Mandatory Convertible, 05/16/06 ................. 1,496,475
54,000 XL Capital Ltd., 6.50% Mandatory Convertible, 05/15/07 ........................... 1,281,150(1)
-------------------------------------------------------------------------------------------------------------------
3,985,925
----------------
UTILITIES -- 3.7%
------------------------------------------------------------------------------------------------------------------------
170,700 Ameren Corporation, 9.75%, Mandatory Convertible, 05/15/05 ....................... 4,701,931
125,000 American Electric Power, 9.25%, Mandatory Convertible, 8/16/05 ................... 5,573,125
300,000 Duke Energy Corporation .......................................................... 6,646,500*
324,300 FPL Group, Inc., 8.50%, Mandatory Convertible, Series A 02/16/05 ................. 18,674,816
100,000 Keyspan Corporation, 8.75%, Mandatory Convertible, 05/16/05 ...................... 5,212,500
365,000 TXU Corporation, 8.75%, Mandatory Convertible, 11/16/05 .......................... 16,682,325
-------------------------------------------------------------------------------------------------------------------
57,491,197
----------------
MISCELLANEOUS -- 0.2%
------------------------------------------------------------------------------------------------------------------------
65,000 Alltel Corporation, 7.75% Pfd. Mandatory Convertible, 05/17/05 ................... 3,344,575
-------------------------------------------------------------------------------------------------------------------
3,344,575
----------------
TOTAL COMMON STOCK AND CONVERTIBLE SECURITIES
(Cost $53,073,434) ............................................................. 64,821,697
----------------
11
--------------------------------------------------------------------------------
Flaherty & Crumrine/Claymore Preferred Securities Income Fund Incorporated
PORTFOLIO OF INVESTMENTS (CONTINUED)
AUGUST 31, 2004 (UNAUDITED)
--------------------------------------------------------------------------
SHARES/$ PAR VALUE
-------------- -------
OPTION CONTRACTS -- 0.1%
10,500 October Put Options on December U.S. Treasury Bond Futures, Expiring 9/25/04 ..... $ 1,078,125+
-------------------------------------------------------------------------------------------------------------------
TOTAL OPTIONS CONTRACTS
(Cost $8,330,949) .............................................................. 1,078,125
MONEY MARKET FUND -- 1.8%
28,885,432 BlackRock Provident Institutional, TempFund ...................................... 28,885,432
-------------------------------------------------------------------------------------------------------------------
TOTAL MONEY MARKET FUND
(Cost $28,885,432) ............................................................. 28,885,432
---------------
TOTAL INVESTMENTS (Cost $1,504,970,280***) .............................. 99.3% $ 1,560,563,055
OTHER ASSETS AND LIABILITIES (NET) ...................................... 0.7% 10,468,275
------- ----------------
TOTAL NET ASSETS AVAILABLE TO COMMON STOCK AND PREFERRED STOCK .......... 100.0%++ $ 1,571,031,330
------ ----------------
AUCTION MARKET PREFERRED STOCK (AMPS) REDEMPTION VALUE ......................................... (542,000,000)
ACCUMULATED UNDECLARED DISTRIBUTIONS TO AMPS ................................................... (213,655)
----------------
TOTAL NET ASSETS AVAILABLE TO COMMON STOCK ..................................................... $ 1,028,817,675
=================
-----------------------------
* Securities eligible for the Dividends Received Deduction and distributing Qualified Dividend Income.
** Securities distributing Qualified Dividend Income only.
*** Aggregate cost of securities held.
**** Securities exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be resold in transactions exempt from registration
to qualified institutional buyers.
(1) Foreign issuer.
+ Non-income producing.
++ The percentage shown for each investment category is the total value of
that category as a percentage of net assets available to Common and Preferred Stock.
ABBREVIATIONS:
REIT -- Real Estate Investment Trust
PFD. -- Preferred Securities
PVT. -- Private Placement Securities
Capital Securities are treated as debt instruments for financial
statement purposes and the amounts shown in the Shares/$ Par column
are dollar amounts of par value.
12
ITEM 2. CONTROLS AND PROCEDURES.
(a) The registrant's principal executive and principal financial officers,
or persons performing similar functions, have concluded that the
registrant's disclosure controls and procedures (as defined in Rule
30a-3(c) under the Investment Company Act of 1940, as amended (the
"1940 Act") (17 CFR 270.30a-3(c))) are effective, as of a date within
90 days of the filing date of the report that includes the disclosure
required by this paragraph, based on their evaluation of these controls
and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR
270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the Securities
Exchange Act of 1934, as amended (17 CFR 240.13a-15(b) or
240.15d-15(b)).
(b) There were no changes in the registrant's internal control over
financial reporting (as defined in Rule 30a-3(d) under the 1940 Act (17
CFR 270.30a-3(d)) that occurred during the registrant's last fiscal
quarter that has materially affected, or is reasonably likely to
materially affect, the registrant's internal control over financial
reporting.
ITEM 3. EXHIBITS.
Certifications pursuant to Rule 30a-2(a) under the 1940 Act and Section 302 of
the Sarbanes-Oxley Act of 2002 are attached hereto.
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.
(Registrant) FLAHERTY & CRUMRINE/CLAYMORE PREFERRED SECURITIES INCOME FUND
INCORPORATED
-------------------------------------------------------------------
By (Signature and Title)* /S/ DONALD F. CRUMRINE
-------------------------------------------------------
Donald F. Crumrine, Director, Chairman of the Board and
Chief Executive Officer
(principal executive officer)
Date OCTOBER 8, 2004
----------------------------------------------------------------------------
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/ DONALD F. CRUMRINE
-------------------------------------------------------
Donald F. Crumrine, Director, Chairman of the Board and
Chief Executive Officer
(principal executive officer)
Date OCTOBER 8, 2004
----------------------------------------------------------------------------
By (Signature and Title)* /S/ R. ERIC CHADWICK
-------------------------------------------------------
R. Eric Chadwick, Chief Financial Officer, Treasurer,
Vice President and Secretary
(principal financial officer)
Date OCTOBER 8, 2004
----------------------------------------------------------------------------
* Print the name and title of each signing officer under his or her signature.