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 811-06540

 

Name of Fund: BlackRock MuniYield Quality Fund III, Inc. (MYI)

 

Fund Address: 100 Bellevue Parkway, Wilmington, DE 19809

 

Name and address of agent for service: John M. Perlowski, Chief Executive Officer, BlackRock MuniYield Quality Fund III, Inc., 55 East 52nd Street, New York, NY 10055

 

Registrant’s telephone number, including area code: (800) 882-0052, Option 4

 

Date of fiscal year end: 07/31/2012

 

Date of reporting period: 10/31/2011

 

Item 1 – Schedule of Investments

 

 

 

 

 

Schedule of Investments October 31, 2011 (Unaudited)

BlackRock MuniYield Quality Fund III, Inc. (MYI)

 

(Percentages shown are based on Net Assets)

 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Alabama — 0.4%

 

 

 

 

 

 

 

Birmingham Special Care Facilities
Financing Authority, RB, Children’s
Hospital, Children’s Hospital (AGC),
6.00%, 6/01/39

 

$

3,605

 

$

3,950,467

 

Alaska — 1.5%

 

 

 

 

 

 

 

Alaska Housing Finance Corp., RB,
General Housing, Series B (NPFGC),
5.25%, 12/01/30

 

 

2,000

 

 

2,043,080

 

Borough of Matanuska-Susitna Alaska,
RB, Goose Creek Correctional Center
(AGC), 6.00%, 9/01/28

 

 

10,150

 

 

11,702,036

 

 

 

 

 

 

 

13,745,116

 

Arizona — 0.9%

 

 

 

 

 

 

 

Arizona State Health Facilities Authority,
RB, 5.00%, 3/01/41

 

 

2,450

 

 

2,420,110

 

Maricopa County & Phoenix Industrial
Development Authorities, Refunding
RB, S/F, Series A-2, AMT (Ginnie
Mae), 5.80%, 7/01/40

 

 

1,520

 

 

1,548,576

 

State of Arizona, COP, Department of
Administration, Series A (AGM),
5.00%, 10/01/27

 

 

3,725

 

 

3,985,936

 

 

 

 

 

 

 

7,954,622

 

California — 13.4%

 

 

 

 

 

 

 

Alameda Corridor Transportation
Authority, Refunding RB, CAB,
Subordinate Lien, Series A (AMBAC),
5.40%, 10/01/24 (a)

 

 

10,000

 

 

8,974,200

 

California Health Facilities Financing
Authority, Refunding RB:

 

 

 

 

 

 

 

Sutter Health, Series B,
5.88%, 8/15/31

 

 

3,200

 

 

3,455,936

 

St. Joseph Health System,
Series A, 5.75%, 7/01/39

 

 

1,550

 

 

1,614,154

 

California HFA, RB, AMT, Home
Mortgage, RB, Home Mortgage,
Series K, 5.50%, 2/01/42

 

 

4,530

 

 

4,507,395

 

California State University, RB,
Systemwide, Series A:

 

 

 

 

 

 

 

5.50%, 11/01/39

 

 

1,525

 

 

1,615,204

 

 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

California (continued)

 

 

 

 

 

 

 

California State University, RB,
Systemwide, Series A (concluded):

 

 

 

 

 

 

 

(NPFGC), 5.00%, 11/01/32

 

$

9,865

 

$

9,991,469

 

California State University, Refunding
RB, Systemwide, Series A (AGM),
5.00%, 11/01/37

 

 

3,545

 

 

3,621,856

 

California Statewide Communities
Development Authority, RB (AGM):

 

 

 

 

 

 

 

St. Joseph Health System,
Series E, 5.25%, 7/01/47

 

 

5,000

 

 

5,036,800

 

Sutter Health, Series D,
5.05%, 8/15/38

 

 

300

 

 

301,518

 

City of Redding California, COP,
Refunding, Series A (AGM), 5.00%,
6/01/30

 

 

1,900

 

 

1,986,564

 

City of San Jose California, RB,
Series A-1, AMT, 5.75%, 3/01/34

 

 

2,300

 

 

2,401,062

 

City of San Jose California, Refunding
RB, Series A, AMT (AMBAC), 5.50%,
3/01/32

 

 

11,965

 

 

12,118,272

 

Coast Community College District, GO,
Election of 2002, Series C (AGM),
6.19%, 8/01/33 (b)

 

 

8,100

 

 

2,153,304

 

County of Sacramento California, RB,
Senior Series A (AGM), 5.00%,
7/01/41

 

 

14,500

 

 

14,753,895

 

Dublin Unified School District California,
GO, CAB, Election of 2004, Series D,
6.47%, 8/01/34 (b)

 

 

5,000

 

 

1,174,450

 

Fairfield-Suisun Unified School District
California, GO, Election of 2002
(NPFGC), 5.50%, 8/01/28

 

 

5,800

 

 

6,165,516

 

Long Beach Unified School District, GO,
Election of 2008, Series B, 6.16%,
8/01/34 (b)

 

 

5,000

 

 

1,257,600

 

Los Angeles Community College District
California, GO, Election of 2001,
Series A (AGM), 5.00%, 8/01/32

 

 

1,200

 

 

1,259,136

 

Mendocino-Lake Community College
District, GO, Election of 2006,
Series A (NPFGC), 5.00%, 8/01/31

 

 

1,485

 

 

1,524,412

 

 

Portfolio Abbreviations

To simplify the listings of portfolio holdings in the Schedule of Investments, the names and descriptions of many of the securities have been abbreviated according to the following list:

 

 

AGC

Assured Guaranty Corp.

AGM

Assured Guaranty Municipal Corp.

AMBAC

American Municipal Bond Assurance Corp.

AMT

Alternative Minimum Tax (subject to)

ARB

Airport Revenue Bonds

BHAC

Berkshire Hathaway Assurance Corp.

CAB

Capital Appreciation Bonds

COP

Certificates of Participation

EDA

Economic Development Authority

ERB

Education Revenue Bonds

GAN

Grant Anticipation Notes

GO

General Obligation Bonds

HDA

Housing Development Authority

HFA

Housing Finance Agency

HRB

Housing Revenue Bonds

ISD

Independent School District

MRB

Mortgage Revenue Bonds

NPFGC

National Public Finance Guarantee Corp.

PSF-GTD

Permanent School Fund Guaranteed

RB

Revenue Bonds

S/F

Single-Family

Syncora

Syncora Guarantee

 

 

 

 

 

 

 

 

 

BLACKROCK MUNIYIELD QUALITY FUND III, INC.

OCTOBER 31, 2011

1


 

 

 

 

Schedule of Investments (continued)

BlackRock MuniYield Quality Fund III, Inc. (MYI)

 

(Percentages shown are based on Net Assets)

 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

California (concluded)

 

 

 

 

 

 

 

Norwalk-La Mirada Unified School
District California, GO, Refunding,
CAB, Election of 2002, Series E (AGC),
6.46%, 8/01/38 (b)

 

$

7,620

 

$

1,391,031

 

Oceanside Unified School District
California, GO, Series A (AGC), 5.25%,
8/01/33

 

 

2,500

 

 

2,637,700

 

Port of Oakland, Refunding RB, Series M
(NPFGC), 5.38%, 11/01/27

 

 

8,030

 

 

8,062,923

 

Poway Unified School District, GO, CAB,
School Facilities Improvement,
District, 2008 Election, Series B,
6.25%, 8/01/36 (b)

 

 

10,000

 

 

2,180,100

 

Riverside County Public Financing
Authority, Tax Allocation Bonds,
Redevelopment Projects (Syncora),
5.00%, 10/01/35

 

 

10,000

 

 

8,350,200

 

San Bernardino Community College
District, GO, Election of 2002, Series
C (AGM), 5.00%, 8/01/31

 

 

2,165

 

 

2,226,529

 

San Joaquin County Transportation
Authority, RB, Limited Tax, Measure K,
Series A, 6.00%, 3/01/36

 

 

1,830

 

 

2,089,659

 

San Marcos Unified School District, GO,
Election of 2010, Series A:

 

 

 

 

 

 

 

5.00%, 8/01/34

 

 

1,800

 

 

1,873,170

 

5.00%, 8/01/38

 

 

1,600

 

 

1,658,624

 

State of California, GO, Series 2007-2
(NPFGC), 5.50%, 4/01/30

 

 

10

 

 

10,516

 

Stockton Public Financing Authority
California, RB, Parking & Capital
Projects (NPFGC), 5.25%, 9/01/34

 

 

5,000

 

 

5,019,200

 

Walnut Valley Unified School District,
GO, Capital Appreciation, Election of
2007, Series B, 6.15%, 8/01/36 (b)

 

 

6,545

 

 

1,461,564

 

West Valley-Mission Community College
District, GO, Election of 2004, Series
A (AGM), 5.00%, 8/01/30

 

 

3,600

 

 

3,738,348

 

 

 

 

 

 

 

124,612,307

 

Connecticut — 0.2%

 

 

 

 

 

 

 

Connecticut State Health & Educational
Facilities Authority, RB, Hartford
Healthcare, Series A, 5.00%, 7/01/32

 

 

1,830

 

 

1,839,626

 

Florida — 16.3%

 

 

 

 

 

 

 

Broward County School Board Florida,
COP, Series A (AGM), 5.25%, 7/01/33

 

 

15,000

 

 

15,483,750

 

City of Orlando Florida, RB, Senior, 6th
Cent Contract Payments, Series A
(AGC), 5.25%, 11/01/38

 

 

12,850

 

 

12,876,214

 

Collier County School Board, COP (AGM),
5.00%, 2/15/23

 

 

5,000

 

 

5,359,850

 

County of Broward Florida, Water &
Sewer Utility, RB, Series A, 5.25%,
10/01/34

 

 

2,250

 

 

2,415,600

 

County of Lee Florida, Refunding RB,
Series A, AMT:

 

 

 

 

 

 

 

5.63%, 10/01/26

 

 

2,600

 

 

2,703,948

 

 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Florida (concluded)

 

 

 

 

 

 

 

County of Lee Florida, Refunding RB,
Series A, AMT (concluded):

 

 

 

 

 

 

 

5.38%, 10/01/32

 

$

3,440

 

$

3,420,599

 

County of Miami-Dade Florida, GO,
Building Better Communities
Program:

 

 

 

 

 

 

 

Series B, 6.38%, 7/01/28

 

 

6,000

 

 

6,730,080

 

Series B-1, 5.75%, 7/01/33

 

 

3,700

 

 

4,012,317

 

County of Miami-Dade Florida, RB:

 

 

 

 

 

 

 

Miami International Airport, AMT
(NPFGC), 5.38%, 10/01/25

 

 

7,500

 

 

7,595,700

 

Miami International Airport, AMT
(NPFGC), 5.38%, 10/01/27

 

 

1,000

 

 

1,008,890

 

Miami International Airport,
Series A, AMT, (AGM), 5.50%,
10/01/41

 

 

19,020

 

 

19,258,891

 

Water & Sewer System (AGM),
5.00%, 10/01/39

 

 

11,700

 

 

12,160,161

 

County of Miami-Dade Florida,
Refunding RB:

 

 

 

 

 

 

 

Miami International Airport (AGC),
5.00%, 10/01/40

 

 

11,000

 

 

10,545,370

 

Series C (BHAC), 6.00%, 10/01/23

 

 

20,095

 

 

23,465,735

 

(AGM), 5.00%, 7/01/35

 

 

2,800

 

 

2,884,560

 

Highlands County Health Facilities
Authority, RB, Adventist Health
System/Sunbelt, Series B, 6.00%,
11/15/37

 

 

1,750

 

 

1,889,860

 

Miami-Dade County School Board, COP,
RB, Series B (AGC), 5.25%, 5/01/31

 

 

1,290

 

 

1,352,888

 

Orange County School Board, COP,
Series A (AGC), 5.50%, 8/01/34

 

 

12,000

 

 

12,720,600

 

Sarasota County Public Hospital District,
RB, Sarasota Memorial Hospital
Project, Series A, 5.63%, 7/01/39

 

 

5,135

 

 

5,228,919

 

 

 

 

 

 

 

151,113,932

 

Georgia — 1.9%

 

 

 

 

 

 

 

Burke County Development Authority,
RB, Oglethorpe Power Corp., Vogtle
Project, Series C, 5.70%, 1/01/43

 

 

6,450

 

 

6,676,911

 

City of Atlanta Georgia, RB, General,
Series B (AGM), 5.25%, 1/01/33

 

 

10,000

 

 

10,350,000

 

Gwinnett County Hospital Authority,
Refunding RB, Gwinnett Hospital
System, Series D (AGM), 5.50%,
7/01/41

 

 

1,025

 

 

1,068,491

 

 

 

 

 

 

 

18,095,402

 

Illinois — 17.6%

 

 

 

 

 

 

 

Chicago Board of Education, GO,
Series A:

 

 

 

 

 

 

 

5.50%, 12/01/39 (c)

 

 

6,470

 

 

6,854,965

 

Chicago Board of Education, GO,
Refunding, CAB, School Reform, Series
A (NPFGC), 4.79%, 12/01/22 (b)

 

 

7,430

 

 

4,395,439

 

Chicago Park District, GO, Harbor
Facilities, Series C:

 

 

 

 

 

 

 

5.25%, 1/01/37

 

 

4,000

 

 

4,210,760

 

 

 

 

 

 

 

 

 

 

BLACKROCK MUNIYIELD QUALITY FUND III, INC.

OCTOBER 31, 2011

2


 

 

 

 

Schedule of Investments (continued)

BlackRock MuniYield Quality Fund III, Inc. (MYI)

 

(Percentages shown are based on Net Assets)

 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Illinois (concluded)

 

 

 

 

 

 

 

Chicago Park District, GO, Harbor
Facilities, Series C (concluded):

 

 

 

 

 

 

 

5.25%, 1/01/40

 

$

1,505

 

$

1,579,693

 

Chicago Transit Authority, Sales Tax
Revenue, RB, 5.25%, 12/01/36 (c)

 

 

1,620

 

 

1,675,048

 

City of Chicago Illinois, ARB, General,
Third Lien, Series B-2, AMT (NPFGC),

 

 

 

 

 

 

 

5.25%, 1/01/27

 

 

10,000

 

 

10,070,400

 

6.00%, 1/01/27

 

 

26,230

 

 

27,267,921

 

City of Chicago Illinois, GO, CAB, City
Colleges (NPFGC) (b):

 

 

 

 

 

 

 

5.75%, 1/01/29

 

 

5,000

 

 

1,889,450

 

6.16%, 1/01/33

 

 

7,950

 

 

2,201,117

 

City of Chicago Illinois, RB:

 

 

 

 

 

 

 

Second Lien, Series A (AMBAC),
5.00%, 11/01/36

 

 

3,500

 

 

3,516,905

 

O’Hare International Airport,
General Third Lien, Series A,
5.75%, 1/01/39

 

 

9,000

 

 

9,822,690

 

City of Chicago Illinois, Refunding RB,
ARB, O’Hare International Airport,
General, Third Lien, Series C-2, AMT
(AGM), 5.25%, 1/01/30

 

 

16,400

 

 

16,421,976

 

Illinois Finance Authority, RB, Series A,
5.75%, 8/15/34

 

 

8,700

 

 

8,763,858

 

Illinois Finance Authority, Refunding RB,
Northwestern Memorial Hospital,
Series A, 6.00%, 8/15/39

 

 

5,250

 

 

5,747,752

 

Illinois Municipal Electric Agency, RB,
Series A (NPFGC):

 

 

 

 

 

 

 

5.00%, 2/01/35

 

 

19,775

 

 

20,259,290

 

5.25%, 2/01/35

 

 

15,000

 

 

15,519,750

 

Illinois State Toll Highway Authority, RB,
Series B:

 

 

 

 

 

 

 

5.50%, 1/01/33

 

 

4,000

 

 

4,219,680

 

(BHAC), 5.50%, 1/01/33

 

 

2,000

 

 

2,120,880

 

Kane, Kendall, Etc. Counties Community
College District No. 516 Illinois, GO,
CAB, Series E (NPFGC), 5.26%,
12/15/25 (b)

 

 

8,750

 

 

4,203,675

 

Metropolitan Pier & Exposition Authority,
RB, CAB, McCormick Place Expansion
Project, Series A (NPFGC) (b):

 

 

 

 

 

 

 

5.96%, 6/15/32

 

 

14,000

 

 

4,170,040

 

6.04%, 12/15/34

 

 

10,000

 

 

2,526,100

 

Metropolitan Pier & Exposition Authority,
Refunding RB, CAB, McCormick Place
Expansion Project, Series B (AGM) (b):

 

 

 

 

 

 

 

5.58%, 6/15/27

 

 

3,575

 

 

1,513,119

 

6.16%, 6/15/44

 

 

9,430

 

 

1,303,037

 

Railsplitter Tobacco Settlement
Authority, RB, 6.00%, 6/01/28

 

 

1,700

 

 

1,767,694

 

Regional Transportation Authority, RB,
Series C (NPFGC), 7.75%, 6/01/20

 

 

1,000

 

 

1,227,440

 

 

 

 

 

 

 

163,248,679

 

 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Indiana — 3.1%

 

 

 

 

 

 

 

City of Indianapolis Indiana, Refunding
RB, Second Lien, Series B (AGC),
5.25%, 8/15/27

 

$

5,000

 

$

5,325,250

 

Indiana Finance Authority, RB,
Wastewater Utility, 5.25%, 10/01/38

 

 

2,900

 

 

3,093,865

 

Indiana Municipal Power Agency, RB:

 

 

 

 

 

 

 

Series A (NPFGC), 5.00%,
1/01/37

 

 

4,750

 

 

4,864,712

 

Series B, 5.75%, 1/01/34

 

 

1,050

 

 

1,078,476

 

Series B, 6.00%, 1/01/39

 

 

5,000

 

 

5,457,950

 

Indianapolis Local Public Improvement
Bond Bank, Refunding RB,
Waterworks Project, Series A:

 

 

 

 

 

 

 

5.75%, 1/01/38

 

 

2,900

 

 

3,141,918

 

(AGC), 5.25%, 1/01/29

 

 

1,350

 

 

1,449,819

 

(AGC), 5.50%, 1/01/38

 

 

4,250

 

 

4,574,998

 

 

 

 

 

 

 

28,986,988

 

Iowa — 1.4%

 

 

 

 

 

 

 

Iowa Finance Authority, RB, Series A
(AGC), 5.63%, 8/15/37

 

 

12,650

 

 

13,287,054

 

Kentucky — 1.3%

 

 

 

 

 

 

 

Kentucky State Property & Buildings
Commission, Refunding RB, Project
No. 93 (AGC), 5.25%, 2/01/28

 

 

4,000

 

 

4,298,720

 

Louisville & Jefferson County
Metropolitan Sewer District Kentucky,
RB, Series A (NPFGC), 5.25%,
5/15/37

 

 

7,000

 

 

7,449,960

 

 

 

 

 

 

 

11,748,680

 

Louisiana — 1.0%

 

 

 

 

 

 

 

Jefferson Parish Hospital Service District
No. 1, Refunding RB, Ref-w Jefferson
Med Ctr, Series A (AGM), 6.00%,
1/01/39

 

 

2,150

 

 

2,251,609

 

New Orleans Aviation Board Louisiana,
RB, New Orleans Aviation, Series A,
AMT (AGM), 5.25%, 1/01/32

 

 

6,605

 

 

6,750,971

 

 

 

 

 

 

 

9,002,580

 

Massachusetts — 4.5%

 

 

 

 

 

 

 

Massachusetts HFA, RB:

 

 

 

 

 

 

 

S/F Housing, Series 128 AMT
(AGM), 4.88%, 12/01/38 (d)

 

 

8,260

 

 

8,192,186

 

Series B, 7.00%, 12/01/38

 

 

3,440

 

 

3,815,682

 

Massachusetts HFA, Refunding RB:

 

 

 

 

 

 

 

Housing Development, Series B
(NPFGC), 5.40%, 12/01/28

 

 

1,835

 

 

1,835,312

 

Rental Housing, Series A AMT
(AGM), 5.15%, 7/01/26

 

 

15,490

 

 

15,634,057

 

Series C, AMT, 5.35%,
12/01/42

 

 

3,100

 

 

3,123,188

 

Massachusetts Port Authority,
Refunding RB, BOSFUEL Project, AMT
(NPFGC), 5.00%, 7/01/38

 

 

9,425

 

 

9,207,188

 

 

 

 

 

 

 

41,807,613

 

 

 

 

 

 

 

 

 

 

BLACKROCK MUNIYIELD QUALITY FUND III, INC.

OCTOBER 31, 2011

3


 

 

 

 

Schedule of Investments (continued)

BlackRock MuniYield Quality Fund III, Inc. (MYI)

 

(Percentages shown are based on Net Assets)

 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Michigan — 10.1%

 

 

 

 

 

 

 

City of Detroit Michigan, RB,
Series B (AGM):

 

 

 

 

 

 

 

Senior Lien, 7.50%, 7/01/33

 

$

1,800

 

$

2,133,882

 

Second Lien, 6.25%, 7/01/36

 

 

1,075

 

 

1,205,387

 

Second Lien, 7.00%, 7/01/36

 

 

500

 

 

589,125

 

City of Detroit Michigan, Refunding RB:

 

 

 

 

 

 

 

Series C (NPFGC), 5.00%, 7/01/22

 

 

4,540

 

 

4,617,952

 

Senior Lien, Series D (AGM), 5.00%,
7/01/23

 

 

9,085

 

 

9,258,433

 

Senior Lien, Series C-1 (AGM),
7.00%, 7/01/27

 

 

1,500

 

 

1,755,600

 

Series D (NPFGC), 5.00%, 7/01/33

 

 

5,000

 

 

5,001,700

 

Kalamazoo Hospital Finance Authority,
RB, Bronson Methodist Hospital
(AGM), 5.25%, 5/15/36

 

 

1,160

 

 

1,186,402

 

Lansing Board of Water & Light Utilities,
RB, Series A, 5.50%, 7/01/41

 

 

3,185

 

 

3,505,666

 

Michigan State Building Authority,
Refunding RB, Facilities Program:

 

 

 

 

 

 

 

Series I, (AGC), 5.25%, 10/15/24

 

 

1,750

 

 

1,930,740

 

Series I, (AGC), 5.25%, 10/15/25

 

 

3,250

 

 

3,565,737

 

Series II-A, (AGM), 5.25%,
10/15/36

 

 

8,040

 

 

8,565,896

 

Series I-A, 5.38%, 10/15/36

 

 

2,075

 

 

2,231,434

 

Series I, 6.25%, 10/15/38

 

 

3,125

 

 

3,487,937

 

Series II-A, 5.38%, 10/15/41

 

 

1,900

 

 

2,033,760

 

Michigan State Finance Authority,
Refunding RB, Trinity Health Credit
Group, 5.00%, 12/01/39

 

 

11,600

 

 

11,530,168

 

Michigan State HDA, RB, Series C,
5.50%, 12/01/28

 

 

2,900

 

 

2,953,447

 

Michigan Strategic Fund, Refunding RB,
Detroit Edison Co. Project, Series A
(Syncora), 5.50%, 6/01/30

 

 

5,000

 

 

5,009,450

 

State of Michigan, RB, GAN (AGM):

 

 

 

 

 

 

 

5.25%, 9/15/22

 

 

10,000

 

 

11,041,800

 

5.25%, 9/15/26

 

 

6,650

 

 

7,145,691

 

Wayne County Airport Authority,
Refunding RB, AMT (AGC), 5.38%,
12/01/32

 

 

5,000

 

 

5,027,550

 

 

 

 

 

 

 

93,777,757

 

Minnesota — 0.7%

 

 

 

 

 

 

 

City of Minneapolis Minnesota,
Refunding RB, Fairview Health
Services, Series B (AGC), 6.50%,
11/15/38

 

 

5,500

 

 

6,167,810

 

Nevada — 3.9%

 

 

 

 

 

 

 

City of Las Vegas Nevada, GO, Limited
Tax, Performing Arts Center, 6.00%,
4/01/34

 

 

2,250

 

 

2,508,750

 

County of Clark Nevada, RB:

 

 

 

 

 

 

 

Las Vegas-McCarran International
Airport, Series A (AGC), 5.25%,
7/01/39

 

 

5,170

 

 

5,389,156

 

Subordinate Lien, Series A-2
(NPFGC), 5.00%, 7/01/30

 

 

20,000

 

 

20,207,400

 

 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Nevada (concluded)

 

 

 

 

 

 

 

Las Vegas Convention & Visitors
Authority, RB (AMBAC), 5.00%,
7/01/37

 

$

8,500

 

$

8,526,265

 

 

 

 

 

 

 

36,631,571

 

New Jersey — 4.3%

 

 

 

 

 

 

 

New Jersey EDA, RB, Cigarette Tax,
5.75%, 6/15/34

 

 

4,000

 

 

3,773,040

 

New Jersey EDA, Refunding RB, School
Facilities Construction, Series N-1:

 

 

 

 

 

 

 

(AMBAC), 5.50%, 9/01/24

 

 

10,000

 

 

11,421,200

 

(NPFGC), 5.50%, 9/01/28

 

 

1,685

 

 

1,892,946

 

New Jersey Higher Education Student
Assistance Authority, RB, Series 1,
AMT:

 

 

 

 

 

 

 

5.50%, 12/01/25

 

 

1,250

 

 

1,284,012

 

5.50%, 12/01/26

 

 

1,800

 

 

1,833,390

 

5.75%, 12/01/28

 

 

200

 

 

206,320

 

5.88%, 12/01/33

 

 

6,895

 

 

7,168,456

 

New Jersey Transportation Trust Fund
Authority, RB, Transportation Systems:

 

 

 

 

 

 

 

Series A, (NPFGC), 5.75%, 6/15/25

 

 

4,250

 

 

4,913,467

 

Series C, CAB (AGC), 5.16%,
12/15/25 (b)

 

 

15,735

 

 

7,664,204

 

 

 

 

 

 

 

40,157,035

 

New York — 2.6%

 

 

 

 

 

 

 

City of New York, New York, GO, Series J,
5.25%, 5/15/24

 

 

10,000

 

 

10,875,800

 

Hudson Yards Infrastructure Corp., RB,
5.75%, 2/15/47

 

 

1,920

 

 

2,033,107

 

New York City Transitional Finance
Authority, RB, Fiscal 2009, Series S-4,
5.50%, 1/15/34

 

 

7,250

 

 

7,900,832

 

New York State Dormitory Authority,
ERB, Series B, 5.25%, 3/15/38

 

 

3,250

 

 

3,522,123

 

 

 

 

 

 

 

24,331,862

 

North Carolina — 0.6%

 

 

 

 

 

 

 

North Carolina Medical Care
Commission, RB, Novant Health
Obligation, Series A, 4.75%,
11/01/43

 

 

6,175

 

 

5,672,108

 

Ohio — 0.6%

 

 

 

 

 

 

 

County of Lucas Ohio, Refunding RB,
Promedica Healthcare, Series A,
6.50%, 11/15/37

 

 

3,000

 

 

3,415,260

 

Ohio Higher Educational Facility
Commission, Refunding RB, Summa
Health System, 2010 Project (AGC),
5.25%, 11/15/40

 

 

2,450

 

 

2,473,618

 

 

 

 

 

 

 

5,888,878

 

Pennsylvania — 2.8%

 

 

 

 

 

 

 

Pennsylvania Turnpike Commission, RB:

 

 

 

 

 

 

 

Series A (AMBAC), 5.50%,
12/01/31

 

 

15,600

 

 

16,716,180

 

 

 

 

 

 

 

 

 

 

BLACKROCK MUNIYIELD QUALITY FUND III, INC.

OCTOBER 31, 2011

4


 

 

 

 

Schedule of Investments (continued)

BlackRock MuniYield Quality Fund III, Inc. (MYI)
 (Percentages shown are based on Net Assets)

 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Pennsylvania (concluded)

 

 

 

 

 

 

 

Pennsylvania Turnpike Commission, RB
(concluded):

 

 

 

 

 

 

 

Subordinate, Special Motor
License Fund, 6.00%,
12/01/36

 

$

2,575

 

$

2,970,262

 

Sub-Series C (AGC), 6.25%,
6/01/38

 

 

5,695

 

 

6,496,970

 

 

 

 

 

 

 

26,183,412

 

Puerto Rico — 2.9%

 

 

 

 

 

 

 

Puerto Rico Public Buildings Authority,
Refunding RB, Government Facilities,
Series M-3 (NPFGC):

 

 

 

 

 

 

 

6.00%, 7/01/27

 

 

3,720

 

 

3,937,062

 

6.00%, 7/01/28

 

 

1,780

 

 

1,873,539

 

Puerto Rico Sales Tax Financing Corp.,
RB, First Sub-Series A:

 

 

 

 

 

 

 

5.75%, 8/01/37

 

 

2,000

 

 

2,096,540

 

6.38%, 8/01/39

 

 

10,195

 

 

11,299,526

 

5.50%, 8/01/42

 

 

5,155

 

 

5,313,001

 

Puerto Rico Sales Tax Financing Corp.,
Refunding RB:

 

 

 

 

 

 

 

First Sub-Series C, 6.00%,
8/01/39

 

 

1,180

 

 

1,281,858

 

Series A, (NPFGC), 6.35%,
8/01/41 (b)

 

 

7,500

 

 

1,167,825

 

 

 

 

 

 

 

26,969,351

 

South Carolina — 0.5%

 

 

 

 

 

 

 

South Carolina Jobs-EDA, Refunding RB,
Palmetto Health, Series A (AGM), 6.50%,
8/01/39

 

 

3,600

 

 

3,939,624

 

South Carolina State Housing Finance &
Development Authority, Refunding RB,
Series A-2, AMT (AGM), 6.35%,
7/01/19

 

 

285

 

 

289,001

 

 

 

 

 

 

 

4,228,625

 

Tennessee — 0.5%

 

 

 

 

 

 

 

Memphis Center City Revenue Finance
Corp., RB, Pyramid and Pinch
Distribution, Series B (AGM), 5.25%,
11/01/30

 

 

3,120

 

 

3,314,532

 

Tennessee Housing Development
Agency, Refunding RB,
Homeownership Program, Series A,
AMT (AGM), 5.35%, 1/01/26

 

 

1,350

 

 

1,350,540

 

 

 

 

 

 

 

4,665,072

 

Texas — 13.4%

 

 

 

 

 

 

 

City of Houston Texas, RB, Combined,
First Lien, Series A (AGM), 5.00%,
11/15/36

 

 

10,000

 

 

10,411,800

 

City of Houston Texas, Refunding RB,
Combined, First Lien, Series A (AGC):

 

 

 

 

 

 

 

6.00%, 11/15/35

 

 

5,700

 

 

6,507,234

 

5.38%, 11/15/38

 

 

3,650

 

 

3,956,490

 

 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Texas (concluded)

 

 

 

 

 

 

 

Dallas-Fort Worth International Airport
Facilities Improvement Corp.,
Refunding RB, Joint Series A, AMT
(NPFGC), 5.63%, 11/01/26

 

$

12,210

 

$

12,222,088

 

Dallas ISD, GO, School Building (PSF-
GTD), 6.38%, 2/15/34

 

 

10,000

 

 

12,032,000

 

Grand Prairie ISD Texas, GO, Refunding,
CAB, 5.84%, 8/15/28 (b)

 

 

10,000

 

 

3,807,700

 

Harris County Hospital District, RB,
Senior Lien, Series A (NPFGC), 5.25%,
2/15/37

 

 

5,950

 

 

6,034,490

 

Harris County-Houston Sports Authority,
Refunding RB, Senior Lien, Series G
(NPFGC), 5.25%, 11/15/30

 

 

5,000

 

 

4,658,100

 

Judson ISD Texas, GO, School Building
(AGC), 5.00%, 2/01/37

 

 

10,000

 

 

10,292,000

 

North Texas Tollway Authority,
Refunding RB, First Tier, System:

 

 

 

 

 

 

 

First Tier Series A, 6.00%, 1/01/28

 

 

6,275

 

 

6,951,006

 

Series A, (NPFGC), 5.13%, 1/01/28

 

 

20,000

 

 

20,950,400

 

Series B, (NPFGC), 5.75%, 1/01/40

 

 

10,000

 

 

10,419,900

 

Texas Department of Housing &
Community Affairs, MRB, Series A,
AMT (NPFGC), 5.45%, 9/01/23

 

 

3,870

 

 

3,882,191

 

Texas State Turnpike Authority, RB, First
Tier, Series A (AMBAC):

 

 

 

 

 

 

 

5.50%, 8/15/39

 

 

5,500

 

 

5,483,940

 

5.00%, 8/15/42

 

 

6,900

 

 

6,576,873

 

 

 

 

 

 

 

124,186,212

 

Utah — 1.6%

 

 

 

 

 

 

 

Utah Transit Authority, Refunding RB,
CAB, Sub-Series A (b):

 

 

 

 

 

 

 

(AGC), 4.73%, 6/15/20

 

 

10,000

 

 

7,039,700

 

(NPFGC), 4.11%, 6/15/24

 

 

13,930

 

 

7,725,996

 

 

 

 

 

 

 

14,765,696

 

Vermont — 0.3%

 

 

 

 

 

 

 

Vermont HFA, HRB, Series 12B, AMT
(AGM), 6.30%, 11/01/19

 

 

255

 

 

260,113

 

Vermont HFA, Refunding RB, Multiple
Purpose, Series C, AMT (AGM), 5.50%,
11/01/38 (d)

 

 

2,145

 

 

2,205,360

 

 

 

 

 

 

 

2,465,473

 

Washington — 1.1%

 

 

 

 

 

 

 

Washington Health Care Facilities
Authority, RB, Series A, Providence
Health & Services:

 

 

 

 

 

 

 

5.00%, 10/01/39

 

 

1,125

 

 

1,130,321

 

5.25%, 10/01/39

 

 

2,725

 

 

2,793,807

 

Washington Health Care Facilities
Authority, Refunding RB, Catholic
Health Initiatives, Series D, 6.38%,
10/01/36

 

 

5,400

 

 

6,067,440

 

 

 

 

 

 

 

9,991,568

 

 

 

 

 

 

 

 

 

 

BLACKROCK MUNIYIELD QUALITY FUND III, INC.

OCTOBER 31, 2011

5



 

 

 

 

Schedule of Investments (continued)

BlackRock MuniYield Quality Fund III, Inc. (MYI)
(Percentages shown are based on Net Assets)

 

 

 

 

 

 

 

 

Municipal Bonds

 

Par
(000)

 

Value

 

Wisconsin — 1.2%

 

 

 

 

 

 

 

Wisconsin Health & Educational
Facilities Authority, RB:

 

 

 

 

 

 

 

Ascension Health Senior Credit
Group, 5.00%, 11/15/33

 

$

3,745

 

$

3,870,083

 

Froedtert & Community
Health, Inc., 5.25%, 4/01/39

 

 

3,500

 

 

3,540,530

 

SynergyHealth Inc., 6.00%,
11/15/32

 

 

3,395

 

 

3,462,323

 

 

 

 

 

 

 

10,872,936

 

Total Municipal Bonds – 110.6%

 

 

 

 

 

1,026,348,432

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Municipal Bonds Transferred to Tender
Option Bond (TOB) Trusts (e)

 

 

 

 

 

 

 

Arizona — 1.6%

 

 

 

 

 

 

 

Arizona School Facilities Board, COP
(AGC), 5.13%, 9/01/21)

 

 

10,000

 

 

10,949,600

 

Salt River Project Agricultural
Improvement & Power District, RB,
5.00%, 7/01/16

 

 

3,500

 

 

3,669,925

 

 

 

 

 

 

 

14,619,525

 

California — 12.3%

 

 

 

 

 

 

 

Alameda County Joint Powers Authority,
Refunding RB, Lease (AGM), 5.00%,
12/01/15

 

 

6,990

 

 

7,260,583

 

California State University, RB (AGM):

5.00%, 5/01/15

 

 

18,435

 

 

18,834,773

 

Systemwide, Series A, 5.00%,

11/01/33

 

 

7,996

 

 

8,265,164

 

City of Riverside California, RB, Issue D
(AGM), 5.00%, 4/01/16

 

 

20,000

 

 

20,552,000

 

Foothill-De Anza Community College
District, GO, Election of 1999,
Series C (NPFGC), 5.00%, 8/01/36

 

 

7,500

 

 

7,734,600

 

Las Virgenes Unified School District
California, GO, Series A (AGM), 5.00%,
8/01/31

 

 

10,000

 

 

10,284,340

 

Los Angeles Community College District,
GO, Election of 2008, Series A,
6.00%, 8/01/33

 

 

5,248

 

 

5,982,015

 

Orange County Sanitation District, COP,
Series B (AGM), 5.00%, 2/01/15

 

 

10,780

 

 

11,243,755

 

San Diego Community College District
California, GO, Election of 2002,
5.00%, 2/01/17

 

 

1,047

 

 

1,140,616

 

San Diego County Water Authority, COP,
Refunding, Series 2008-A (AGM),
5.30%, 5/01/16

 

 

9,370

 

 

9,825,101

 

San Francisco Bay Area Rapid Transit
District, RB (AGM), 5.00%, 7/01/36

 

 

10,000

 

 

10,345,670

 

University of California, RB, Series O,
5.75%, 5/15/34

 

 

2,205

 

 

2,467,660

 

 

 

 

 

 

 

113,936,277

 

 

 

 

 

 

 

 

 

Municipal Bonds Transferred to Tender
Option Bond (TOB) Trusts (e)

 

Par
(000)

 

Value

 

Colorado — 0.3%

 

 

 

 

 

 

 

Colorado Health Facilities Authority,
Refunding RB, Catholic Healthcare,
Series A, 5.50%, 7/01/34

 

$

2,469$

 

 

2,587,040

 

Connecticut — 0.6%

 

 

 

 

 

 

 

Connecticut State Health & Educational
Facility Authority, RB, Yale University,
Series T-1, 8.79%, 7/01/15

 

 

5,010

 

 

5,342,363

 

District of Columbia — 2.0%

 

 

 

 

 

 

 

District of Columbia, RB, Series A,
5.50%, 12/01/30)

 

 

2,595

 

 

2,940,005

 

District of Columbia Water & Sewer
Authority, RB, Series A, 6.00%,
10/01/35

 

 

4,281

 

 

5,047,162

 

Metropolitan Washington Airports
Authority, RB, Drivers, Series 3967z,
5.00%, 4/01/16

 

 

10,000

 

 

10,158,200

 

 

 

 

 

 

 

18,145,367

 

Florida — 3.5%

 

 

 

 

 

 

 

City of Tallahassee, RB, 5.00%,
10/01/32

 

 

3,300

 

 

3,405,501

 

Florida State Board of Education, GO,
Series D, 5.00%, 6/01/37

 

 

3,299

 

 

3,481,913

 

Highlands County Health Facilities
Authority, RB, Series C, 5.25%,
11/15/36

 

 

5,400

 

 

5,480,946

 

Miami-Dade County, RB, 5.00%,
7/01/31

 

 

19,800

 

 

20,295,000

 

 

 

 

 

 

 

32,663,360

 

Georgia — 1.2%

 

 

 

 

 

 

 

Metropolitan Atlanta Rapid Transit
Authority, RB, Third Indenture,
Series B (AGM), 5.00%, 7/01/37

 

 

10,000

 

 

10,333,064

 

Hawaii — 1.1%

 

 

 

 

 

 

 

Honolulu City & County Board of Water
Supply, RB, Series A (NPFGC), 5.00%,
7/01/33

 

 

9,830

 

 

10,058,253

 

Illinois — 2.9%

 

 

 

 

 

 

 

City of Chicago, GO, Refunding, Series A
(AGC), 5.25%, 1/01/24

 

 

11,000

 

 

11,670,230

 

Illinois Finance Authority, RB, University
of Chicago, Series B, 6.25%, 7/01/16

 

 

10,000

 

 

11,500,100

 

State of Illinois, RB, Residual,
Series 3283x, 5.25%, 6/15/34

 

 

3,499

 

 

3,661,924

 

 

 

 

 

 

 

26,832,254

 

Kentucky — 0.7%

 

 

 

 

 

 

 

Kentucky State Property & Building
Commission, Refunding RB, Project
No. 93 (AGC), 5.25%, 2/01/27

 

 

5,985

 

 

6,472,236

 

Louisiana — 1.1%

 

 

 

 

 

 

 

State of Louisiana, RB, Series A (AGM),
5.00%, 5/01/36

 

 

10,000

 

 

10,316,700

 

 

 

 

 

 

 

 

 

 

BLACKROCK MUNIYIELD QUALITY FUND III, INC.

OCTOBER 31, 2011

6



 

 

 

 

Schedule of Investments (continued)

BlackRock MuniYield Quality Fund III, Inc. (MYI)

 

(Percentages shown are based on Net Assets)

 

 

 

 

 

 

 

 

Municipal Bonds Transferred to Tender
Option Bond (TOB) Trusts (e)

 

Par
(000)

 

Value

 

Nevada — 0.6%

 

 

 

 

 

 

 

Clark County Water Reclamation
District, GO, Series B:

 

 

 

 

 

 

 

5.50%, 7/01/29

 

$

510

 

$

564,863

 

5.75%, 7/01/34

 

 

4,813

 

 

5,401,798

 

 

 

 

 

 

 

5,966,661

 

New Jersey — 1.3%

 

 

 

 

 

 

 

Garden State Preservation Trust, RB,
Election of 2005, Series A (AGM),
5.75%, 5/01/24

 

 

10,000

 

 

12,422,500

 

New York — 4.7%

 

 

 

 

 

 

 

New York City Municipal Water Finance
Authority, RB, Series DD, 5.00%,
6/15/31

 

 

17,567

 

 

18,496,211

 

Port Authority of New York & New Jersey,
RB, Consolidated, 155th Series, AMT
(AGM), 5.13%, 1/15/13

 

 

19,500

 

 

20,099,430

 

Triborough Bridge & Tunnel Authority,
RB, General, Series A-2, 5.25%,
11/15/34

 

 

4,500

 

 

4,931,595

 

 

 

 

 

 

 

43,527,236

 

North Carolina — 1.1%

 

 

 

 

 

 

 

North Carolina HFA, RB, Series 31-A,
AMT, 5.25%, 1/01/16

 

 

9,946

 

 

9,969,313

 

Ohio — 0.7%

 

 

 

 

 

 

 

Montgomery County, RB (AGM), 5.00%,
4/01/16

 

 

4,990

 

 

5,055,943

 

State of Ohio, RB, Cleveland Clinic
Health, Series B, 5.50%, 1/01/17

 

 

1,520

 

 

1,594,100

 

 

 

 

 

 

 

6,650,043

 

South Carolina — 0.5%

 

 

 

 

 

 

 

South Carolina State Housing Finance &
Development Authority, Refunding RB,
Series B-1, 5.55%, 1/01/16

 

 

4,618

 

 

4,776,077

 

Texas — 4.2%

 

 

 

 

 

 

 

Friendswood ISD Texas, GO,
Schoolhouse (PSF-GTD), 5.00%,
2/15/37

 

 

12,955

 

 

13,639,156

 

Houston ISD, GO, Schoolhouse (PSF-
GTD), 5.00%, 2/15/15

 

 

10,000

 

 

10,540,100

 

North East ISD, GO, 5.00%, 8/01/37

 

 

3,500

 

 

3,705,625

 

Texas State University Systems,
Refunding RB, 5.25%, 3/15/16

 

 

10,000

 

 

11,367,600

 

 

 

 

 

 

 

39,252,481

 

Virginia — 0.3%

 

 

 

 

 

 

 

University of Virginia, Refunding RB,
General, 5.00%, 6/01/16

 

 

2,630

 

 

2,934,238

 

Washington — 5.9%

 

 

 

 

 

 

 

Central Puget Sound Regional Transit
Authority, RB, Series A (AGM), 5.00%,
11/01/15

 

 

16,770

 

 

17,917,487

 

County of King Washington, RB (AGM),
5.00%, 7/01/15

 

 

15,785

 

 

16,643,181

 

 

 

 

 

 

 

 

 

Municipal Bonds Transferred to Tender
Option Bond (TOB) Trust s (e)

 

Par
(000)

 

Value

 

Washington (concluded)

 

 

 

 

 

 

 

Port of Seattle Washington, Refunding
RB, Series B, AMT (NPFGC), 5.20%,
1/01/12

 

$

20,565

 

$

20,697,051

 

 

 

 

 

 

 

55,257,719

 

Wisconsin — 1.6%

 

 

 

 

 

 

 

State of Wisconsin, RB, 6.00%,
5/01/17

 

 

10,000

 

 

11,188,700

 

Wisconsin Health & Educational
Facilities Authority, Refunding RB,
Froedtert & Community Health, Inc.,
5.25%, 4/01/39

 

 

3,959

 

 

4,004,980

 

 

 

 

 

 

 

15,193,680

 

Total Municipal Bonds Transferred to
Tender Option Bond (TOB) Trusts –
48.2%

 

 

 

 

 

447,256,387

 

Total Long-Term Investments
(Cost – $1,417,418,615) – 158.8%

 

 

 

 

 

1,473,604,819

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Short-Term Securities

 

Shares

 

 

 

 

FFI Institutional Tax-Exempt Fund,
0.01% (f)(g)

 

 

25,595,968

 

 

25,595,968

 

Total Short-Term Securities
(Cost — $25,595,968)– 2.8%

 

 

 

 

 

25,595,968

 

Total Investments
(Cost — $1,443,014,583*) - 161.6%

 

 

 

 

 

1,499,200,787

 

Other Assets Less Liabilities– 1.1%

 

 

 

 

 

10,804,879

 

Liability for TOB Trust Certificates, Including Interest
Expense and Fees Payable – (24.3)%

 

 

 

 

 

(225,762,101

)

VRDP Shares, at Liquidation Value – (38.4)%

 

 

 

 

 

(356,400,000

)

Net Assets Applicable to Common Shares – 100.0%

 

 

 

 

$

927,843,565

 

 

 

 

 

*

The cost and unrealized appreciation (depreciation) of investments as of October 31, 2011, as computed for federal income tax purposes, were as follows:

 

 

 

 

 

Aggregate cost

 

$

1,220,228,393

 

Gross unrealized appreciation

 

$

62,476,871

 

Gross unrealized depreciation

 

 

(7,826,835

)

Net unrealized appreciation

 

$

54,650,036

 

 

 

(a)

Represents a step-up bond that pays an initial coupon rate for the first period and then a higher coupon rate for the following periods. Rate shown is as of report date.

 

 

(b)

Represents a zero-coupon bond. Rate shown reflects the current yield as of report date.

 

 

(c)

When-issued security. Unsettled when-issued transactions were as follows:


 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Counterparty

 

Value

 

Unrealized
Appreciation

 

JPMorgan Securities

 

$

1,668,487

 

$

6,561

 

Pershing LLC

 

$

6,697,485

 

$

157,480

 

 

 

 

 

 

 

 

 

 

BLACKROCK MUNIYIELD QUALITY FUND III, INC.

OCTOBER 31, 2011

7



 

 

 

 

Schedule of Investments (concluded)

BlackRock MuniYield Quality Fund III, Inc. (MYI)

 

 

(d)

Variable rate security. Rate shown is as of report date.

 

 

(e)

Securities represent bonds transferred to a TOB in exchange for which the Fund acquired residual interest certificates. These securities serve as collateral in a financing transaction.

 

 

(f)

Investments in companies considered to be an affiliate of the Fund during the period, for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:


 

 

 

 

 

 

 

 

 

 

 

 

 

 

Affiliate

 

Shares
Held at
July 31,
2011

 

Net
Activity

 

Shares
Held at
October 31,
2011

 

Income

 

FFI

 

 

 

 

 

 

 

 

 

 

 

 

 

Institutional
Tax-Exempt
Fund

 

 

4,703,282

 

 

20,892,686

 

 

25,595,968

 

$

454

 

 

 

 

(g)

Represents the current yield as of report date.

 

 

 

•

Fair Value Measurements - Various inputs are used in determining the fair value of investments. These inputs are categorized into a disclosure hierarchy consisting of three broad levels for financial reporting purposes as follows:

 

 

 

 

•

Level 1 — unadjusted price quotations in active markets/exchanges for identical assets and liabilities

 

 

 

 

•

Level 2 — other observable inputs (including, but not limited to: quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs)

 

 

 

 

•

Level 3 — unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Fund’s own assumptions used in determining the fair value of investments)

Changes in valuation techniques may result in transfers in or out of an assigned level within the disclosure hierarchy. The categorization of a value determined for investments is based on the pricing transparency of the investment and does not necessarily correspond to the Fund’s perceived risk of investing in those securities. For information about the Fund’s policy regarding valuation of investments and other significant accounting policies, please refer to the Fund’s most recent financial statements as contained in its annual report.

The following table summarizes the inputs used as of October 31, 2011 in determining the fair valuation of the Fund’s investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Valuation Inputs

 

Level 1

 

Level 2

 

Level 3

 

Total

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

Investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

Long-Term
Investments1

 

 

—

 

$

1,473,604,819

 

 

—

 

$

1,473,604,819

 

Short-Term
Securities

 

$

25,595,968

 

 

—

 

 

—

 

 

25,595,968

 

Total

 

$

25,595,968

 

$

1,473,604,819

 

 

—

 

$

1,499,200,787

 

 

 

1

See above Schedule of Investments for values in each state or political subdivision.

 

 

 

 

 

 

 

 

 

BLACKROCK MUNIYIELD QUALITY FUND III, INC.

OCTOBER 31, 2011

8

Item 2 –

Controls and Procedures

 

 

2(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″)) are effective as of a date within 90 days of the filing of this report based on the evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act and Rule 13a-15(b) under the Securities Exchange Act of 1934, as amended.

 

 

2(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) that occurred during the registrant’s last fiscal quarter that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting.

 

 

Item 3 –

Exhibits

 

 

 

Certifications – 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.

 

 

 

BlackRock MuniYield Quality Fund III, Inc.
   

 

 By: /s/ John M. Perlowski

 

 

 

John M. Perlowski

 

 

Chief Executive Officer (principal executive officer) of

 

 

BlackRock MuniYield Quality Fund III, Inc.

 

 

 

Date: December 21, 2011

 

 

 

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/ John M. Perlowski

 

 

 

John M. Perlowski

 

 

Chief Executive Officer (principal executive officer) of

 

 

BlackRock MuniYield Quality Fund III, Inc.

 

 

 

Date: December 21, 2011

 

 

 

 By: /s/ Neal J. Andrews

 

 

 

Neal J. Andrews

 

 

Chief Financial Officer (principal financial officer) of

 

 

BlackRock MuniYield Quality Fund III, Inc.

 

 

 

 

Date: December 21, 2011