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 811-21506

 

Name of Fund: BlackRock Enhanced Capital and Income Fund, Inc. (CII)

 

Fund Address: 100 Bellevue Parkway, Wilmington, DE 19809

 

Name and address of agent for service: John M. Perlowski, Chief Executive Officer, BlackRock Enhanced Capital and Income Fund, 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: 10/31/2011

 

Date of reporting period: 01/31/2011

 

Item 1 – Schedule of Investments

 

 

 

Schedule of Investments January 31, 2011 (Unaudited)

BlackRock Enhanced Capital and Income Fund, Inc. (CII)

 

(Percentages shown are based on Net Assets)

 

 

 

 

 

 

 

 

Common Stocks

 

Shares

 

Value

 

Aerospace & Defense — 4.9%

 

 

 

 

 

 

 

Honeywell International, Inc.

 

 

207,400

 

$

11,616,474

 

Northrop Grumman Corp.

 

 

165,300

 

 

11,455,290

 

Raytheon Co. (a)

 

 

180,600

 

 

9,028,194

 

 

 

 

 

 

 

 

 

 

 

 

32,099,958

 

Capital Markets — 3.8%

 

 

 

 

 

 

 

Invesco Ltd. (a)

 

 

600,200

 

 

14,848,948

 

Morgan Stanley (a)

 

 

332,613

 

 

9,778,822

 

 

 

 

 

 

 

 

 

 

 

 

24,627,770

 

Chemicals — 2.6%

 

 

 

 

 

 

 

E.I. du Pont de Nemours & Co. (a)

 

 

341,100

 

 

17,286,948

 

Commercial Banks — 1.3%

 

 

 

 

 

 

 

Wells Fargo & Co. (a)

 

 

273,100

 

 

8,853,902

 

Communications Equipment — 0.8%

 

 

 

 

 

 

 

Nokia Oyj - ADR (a)

 

 

471,600

 

 

5,046,120

 

Diversified Financial Services — 4.1%

 

 

 

 

 

 

 

Citigroup, Inc. (a)(b)

 

 

2,289,300

 

 

11,034,426

 

JPMorgan Chase & Co. (a)

 

 

349,800

 

 

15,720,012

 

 

 

 

 

 

 

 

 

 

 

 

26,754,438

 

Diversified Telecommunication Services — 7.9%

 

 

 

 

 

 

 

AT&T Inc. (a)

 

 

460,800

 

 

12,681,216

 

Qwest Communications
International, Inc. (a)

 

 

3,086,400

 

 

22,006,032

 

Verizon Communications, Inc. (a)

 

 

482,800

 

 

17,197,336

 

 

 

 

 

 

 

 

 

 

 

 

51,884,584

 

Electric Utilities — 2.3%

 

 

 

 

 

 

 

NextEra Energy, Inc.

 

 

96,944

 

 

5,182,626

 

The Southern Co. (a)

 

 

261,500

 

 

9,837,630

 

 

 

 

 

 

 

 

 

 

 

 

15,020,256

 

Electrical Equipment — 2.3%

 

 

 

 

 

 

 

Emerson Electric Co.

 

 

251,100

 

 

14,784,768

 

Energy Equipment & Services — 3.2%

 

 

 

 

 

 

 

Ensco Plc – ADR (a)

 

 

250,900

 

 

13,633,906

 

Halliburton Co. (a)

 

 

158,200

 

 

7,119,000

 

 

 

 

 

 

 

 

 

 

 

 

20,752,906

 

Food Products — 7.2%

 

 

 

 

 

 

 

General Mills, Inc. (a)

 

 

325,900

 

 

11,334,802

 

Kraft Foods, Inc. (a)

 

 

609,600

 

 

18,635,472

 

Unilever NV - ADR

 

 

586,300

 

 

17,372,069

 

 

 

 

 

 

 

 

 

 

 

 

47,342,343

 

Household Products — 2.8%

 

 

 

 

 

 

 

Kimberly-Clark Corp. (a)

 

 

285,400

 

 

18,473,942

 

IT Services — 1.5%

 

 

 

 

 

 

 

International Business Machines
Corp. (a)

 

 

62,400

 

 

10,108,800

 

Industrial Conglomerates — 2.2%

 

 

 

 

 

 

 

General Electric Co. (a)

 

 

719,200

 

 

14,484,688

 

Insurance — 7.3%

 

 

 

 

 

 

 

ACE Ltd.

 

 

233,300

 

 

14,368,947

 

MetLife, Inc. (a)

 

 

287,300

 

 

13,149,721

 

The Travelers Cos., Inc. (a)

 

 

361,430

 

 

20,334,052

 

 

 

 

 

 

 

 

 

 

 

 

47,852,720

 

 

 

 

 

 

 

 

 

Common Stocks

 

Shares

 

Value

 

Media — 4.6%

 

 

 

 

 

 

 

Comcast Corp., Special Class A (a)

 

 

688,800

 

$

14,767,872

 

Time Warner, Inc. (a)

 

 

485,700

 

 

15,275,265

 

 

 

 

 

 

 

 

 

 

 

 

30,043,137

 

Metals & Mining — 2.5%

 

 

 

 

 

 

 

Nucor Corp. (a)

 

 

350,500

 

 

16,091,455

 

Multi-Utilities — 1.4%

 

 

 

 

 

 

 

Dominion Resources, Inc. (a)

 

 

215,800

 

 

9,395,932

 

Oil, Gas & Consumable Fuels — 7.3%

 

 

 

 

 

 

 

Chevron Corp. (a)

 

 

210,100

 

 

19,944,793

 

Exxon Mobil Corp.

 

 

212,200

 

 

17,120,296

 

Marathon Oil Corp. (a)

 

 

242,400

 

 

11,077,680

 

 

 

 

 

 

 

 

 

 

 

 

48,142,769

 

Pharmaceuticals — 12.3%

 

 

 

 

 

 

 

Bristol-Myers Squibb Co. (a)

 

 

763,000

 

 

19,212,340

 

Eli Lilly & Co. (a)

 

 

512,100

 

 

17,805,717

 

Johnson & Johnson (a)

 

 

143,000

 

 

8,547,110

 

Merck & Co, Inc. (a)

 

 

489,900

 

 

16,249,983

 

Pfizer, Inc. (a)

 

 

1,053,700

 

 

19,198,414

 

 

 

 

 

 

 

 

 

 

 

 

81,013,564

 

Semiconductors & Semiconductor Equipment — 9.5%

 

 

 

 

 

 

 

Analog Devices, Inc. (a)

 

 

445,600

 

 

17,302,648

 

Intel Corp. (a)

 

 

729,100

 

 

15,646,486

 

LSI Corp. (a)(b)

 

 

1,272,900

 

 

7,879,251

 

Maxim Integrated Products, Inc. (a)

 

 

836,800

 

 

21,606,176

 

 

 

 

 

 

 

 

 

 

 

 

62,434,561

 

Software — 2.0%

 

 

 

 

 

 

 

Microsoft Corp. (a)

 

 

464,300

 

 

12,872,718

 

Specialty Retail — 3.4%

 

 

 

 

 

 

 

Home Depot, Inc. (a)

 

 

371,100

 

 

13,645,347

 

Limited Brands, Inc. (a)

 

 

301,300

 

 

8,810,012

 

 

 

 

 

 

 

 

 

 

 

 

22,455,359

 

Total Long-Term Investments
(Cost – $649,784,740) – 97.2%

 

 

 

 

 

637,823,638

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Short-Term Securities

 

 

 

 

 

 

 

BlackRock Liquidity Funds,
TempFund, Institutional Class,
0.17% I(d)

 

 

18,494,223

 

 

18,494,223

 

Total Short-Term Securities
(Cost – $18,494,223) – 2.8%

 

 

 

 

 

18,494,223

 

Total Investments Before Options Written
(Cost – $668,278,963*) – 100.0%

 

 

 

 

 

656,317,861

 

 

 

 

 

 

 

 

 

 

Portfolio Abbreviation

 

 

ADR

American Depositary Receipts

 

 

 

BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC.

JANUARY 31, 2011

1


 

 

 

 

Schedule of Investments (continued)

BlackRock Enhanced Capital and Income Fund, Inc. (CII)

 

(Percentages shown are based on Net Assets)

 

 

 

 

 

 

 

 

Options Written

 

Contracts

 

Value

 

Exchange-Traded Call Options Written — (1.0)%

 

 

 

 

 

 

 

AT&T Inc.:

 

 

 

 

 

 

 

Strike Price $29, Expires
2/19/11

 

 

1,540

 

$

(6,930

)

Strike Price $29, Expires
3/19/11

 

 

1,000

 

 

(12,000

)

Analog Devices, Inc.:

 

 

 

 

 

 

 

Strike Price $38, Expires
2/19/11

 

 

1,560

 

 

(234,000

)

Strike Price $39, Expires
2/19/11

 

 

120

 

 

(10,800

)

Bristol-Myers Squibb Co., Strike Price
$26, Expires 2/19/11

 

 

4,195

 

 

(44,047

)

Chevron Corp., Strike Price $95,
Expires 3/19/11

 

 

1,570

 

 

(334,410

)

Citigroup, Inc.:

 

 

 

 

 

 

 

Strike Price $5, Expires 2/19/11

 

 

4,515

 

 

(20,317

)

Strike Price $5.50, Expires
2/19/11

 

 

1,000

 

 

(500

)

Strike Price $5, Expires 3/19/11

 

 

2,500

 

 

(26,250

)

Comcast Corp., Special Class A,
Strike Price $20.40, Expires
2/07/11

 

 

2,410

 

 

(260,357

)

Dominion Resources, Inc., Strike
Price $42.50, Expires 3/14/11

 

 

1,067

 

 

(162,133

)

E.I. du Pont de Nemours & Co.,
Strike Price $50, Expires 2/19/11

 

 

2,560

 

 

(285,440

)

Eli Lilly & Co.:

 

 

 

 

 

 

 

Strike Price $35, Expires
2/19/11

 

 

1,400

 

 

(32,900

)

Strike Price $34.85, Expires
3/08/11

 

 

1,415

 

 

(67,136

)

Ensco International Plc, Strike Price
$55, Expires 2/19/11

 

 

150

 

 

(19,500

)

General Electric Co.:

 

 

 

 

 

 

 

Strike Price $18, Expires
2/19/11

 

 

4,020

 

 

(876,360

)

Strike Price $19, Expires
2/19/11

 

 

1,280

 

 

(161,280

)

General Mills, Inc., Strike Price
$36.60, Expires 3/08/11

 

 

1,075

 

 

(20,073

)

Halliburton Co.:

 

 

 

 

 

 

 

Strike Price $40, Expires
3/19/11

 

 

435

 

 

(245,775

)

Strike Price $41, Expires
3/19/11

 

 

435

 

 

(208,800

)

Home Depot, Inc., Strike Price $37,
Expires 3/19/11

 

 

2,780

 

 

(284,950

)

Intel Corp.:

 

 

 

 

 

 

 

Strike Price $21, Expires
2/19/11

 

 

300

 

 

(16,050

)

Strike Price $22, Expires
3/19/11

 

 

3,650

 

 

(118,625

)

International Business Machines Corp.:

 

 

 

 

 

 

 

Strike Price $145, Expires
2/02/11

 

 

270

 

 

(459,000

)

Strike Price $160, Expires
3/19/11

 

 

70

 

 

(30,450

)

Invesco Ltd.:

 

 

 

 

 

 

 

Strike Price $25, Expires
2/19/11

 

 

1,045

 

 

(44,412

)

Strike Price $25, Expires
3/19/11,

 

 

1,055

 

 

(79,125

)

 

 

 

 

 

 

 

 

Options Written

 

Contracts

 

Value

 

Exchange-Traded Call Options Written (continued)

 

 

 

 

 

 

 

JPMorgan Chase & Co.:

 

 

 

 

 

 

 

Strike Price $41, Expires
2/19/11

 

 

625

 

$

(256,250

)

Strike Price $46, Expires
3/19/11

 

 

600

 

 

(66,000

)

Johnson & Johnson, Strike Price
$62.50, Expires 2/19/11

 

 

1,070

 

 

(4,815

)

Kimberly-Clark Corp., Strike Price
$64.50, Expires 2/25/11

 

 

1,570

 

 

(113,729

)

Kraft Foods, Inc.:

 

 

 

 

 

 

 

Strike Price $31, Expires
2/19/11

 

 

2,285

 

 

(63,980

)

Strike Price $32, Expires
2/19/11

 

 

2,285

 

 

(13,710

)

LSI Corp.:

 

 

 

 

 

 

 

Strike Price $6, Expires 2/19/11

 

 

2,100

 

 

(52,500

)

Strike Price $6, Expires 3/19/11

 

 

2,100

 

 

(73,500

)

Limited Brands, Inc.:

 

 

 

 

 

 

 

Strike Price $29, Expires
3/19/11

 

 

830

 

 

(107,900

)

Strike Price $30, Expires
3/19/11

 

 

830

 

 

(70,550

)

Marathon Oil Corp., Strike Price $43,
Expires 3/19/11

 

 

1,350

 

 

(455,625

)

Maxim Integrated Products, Inc.:

 

 

 

 

 

 

 

Strike Price $25, Expires
2/19/11

 

 

500

 

 

(56,250

)

Strike Price $26, Expires
3/19/11

 

 

950

 

 

(80,750

)

Strike Price $27, Expires
3/19/11

 

 

500

 

 

(23,750

)

Merck & Co., Inc., Strike Price $34,
Expires 2/19/11

 

 

2,695

 

 

(80,850

)

MetLife, Inc.:

 

 

 

 

 

 

 

Strike Price $45, Expires
2/19/11

 

 

505

 

 

(83,578

)

Strike Price $47, Expires
3/19/11

 

 

500

 

 

(61,750

)

Microsoft Corp.:

 

 

 

 

 

 

 

Strike Price $28.50, Expires
2/19/11

 

 

2,470

 

 

(41,242

)

Strike Price $28, Expires
3/19/11

 

 

1,010

 

 

(65,650

)

Morgan Stanley, Strike Price $30,
Expires 3/19/11

 

 

1,160

 

 

(98,600

)

Nokia Oyj:

 

 

 

 

 

 

 

Strike Price $11, Expires 2/19/11

 

 

825

 

 

(19,387

)

Strike Price $11, Expires 3/07/11

 

 

825

 

 

(23,269

)

Nucor Corp., Strike Price $45,
Expires 2/19/11

 

 

1,220

 

 

(198,250

)

Pfizer, Inc., Strike Price $18.35,
Expires 2/19/11

 

 

1,915

 

 

(61,743

)

Qwest Communications International, Inc.:

 

 

 

 

 

 

 

Strike Price $7, Expires 2/19/11

 

 

1,550

 

 

(31,000

)

Strike Price $7, Expires 3/19/11

 

 

1,550

 

 

(31,000

)

Raytheon Co.:

 

 

 

 

 

 

 

Strike Price $50, Expires
2/19/11

 

 

690

 

 

(63,480

)

Strike Price $52.50, Expires
3/19/11

 

 

665

 

 

(32,585

)

 

 

 

2

BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC.

JANUARY 31, 2011


 

 

 

 

Schedule of Investments (continued)

BlackRock Enhanced Capital and Income Fund, Inc. (CII)

 

(Percentages shown are based on Net Assets)

 

 

 

 

 

 

 

 

Options Written

 

Contracts

 

Value

 

Exchange-Traded Call Options Written (concluded)

 

 

 

 

 

 

 

The Southern Co.:

 

 

 

 

 

 

 

Strike Price $38, Expires
2/19/11

 

 

985

 

$

(6,895

)

Strike Price $38.40, Expires
3/19/11

 

 

970

 

 

(16,279

)

Time Warner, Inc.:

 

 

 

 

 

 

 

Strike Price $33, Expires
2/19/11

 

 

1,350

 

 

(23,625

)

Strike Price $33, Expires
3/19/11

 

 

1,350

 

 

(44,550

)

The Travelers Cos., Inc.:

 

 

 

 

 

 

 

Strike Price $55, Expires
2/19/11

 

 

635

 

 

(107,950

)

Strike Price $55, Expires
3/07/11

 

 

635

 

 

(113,687

)

Verizon Communications, Inc., Strike
Price $38, Expires 2/19/11

 

 

2,650

 

 

(9,275

)

Wells Fargo & Co., Strike Price $33,
Expires 3/19/11

 

 

1,500

 

 

(135,000

)

 

 

 

 

 

 

 

 

 

 

 

(6,850,574

)

Over-the-Counter Call Options Written – (0.5)%

 

 

 

 

 

 

 

ACE Ltd., Strike Price $61.50,
Expires 3/11/11, Broker Credit
Suisse International

 

 

81,000

 

 

(143,176

)

Dominion Resources, Inc., Strike
Price $43.25, Expires 2/04/11,
Broker UBS AG

 

 

55,000

 

 

(23,802

)

Emerson Electric Co., Strike Price
$58.60, Expires 2/07/11, Broker
Citibank NA

 

 

88,000

 

 

(80,646

)

Ensco International Plc, Strike Price
$52.46, Expires 3/10/11, Broker
UBS AG

 

 

138,000

 

 

(454,950

)

Exxon Mobil Corp.:

 

 

 

 

 

 

 

Strike Price $75.75, Expires
3/11/11, Broker Goldman
Sachs USA

 

 

79,500

 

 

(413,531

)

Strike Price $76, Expires
3/17/11, Broker Goldman
Sachs USA

 

 

79,500

 

 

(403,544

)

General Mills, Inc., Strike Price
$36.47, Expires 2/11/11, Broker
JPMorgan Chase Bank NA

 

 

68,500

 

 

(1,630

)

Honeywell International, Inc., Strike
Price $53.52, Expires 2/11/11,
Broker Morgan Stanley Capital
Services, Inc.

 

 

79,000

 

 

(207,119

)

LSI Corp., Strike Price $6.16,
Expires 2/03/11, Broker Credit
Suisse International

 

 

36,000

 

 

(1,551

)

Maxim Integrated Products, Inc.:

 

 

 

 

 

 

 

Strike Price $23.35, Expires
2/04/11, Broker Credit Suisse
International

 

 

171,000

 

 

(422,370

)

Strike Price $26.48, Expires
3/04/11, Broker Credit Suisse
International

 

 

94,000

 

 

(37,315

)

NextEra Energy, Inc.:

 

 

 

 

 

 

 

Strike Price $52.94, Expires
2/04/11, Broker UBS AG

 

 

20,000

 

 

(12,332

)

 

 

 

 

 

 

 

 

Options Written

 

Contracts

 

Value

 

Over-the-Counter Call Options Written (concluded)

 

 

 

 

 

 

 

NextEra Energy, Inc. (concluded):

 

 

 

 

 

 

 

Strike Price $51.79, Expires
2/11/11, Broker Goldman
Sachs USA

 

 

40,000

 

$

(72,175

)

Northrop Grumman Corp.:

 

 

 

 

 

 

 

Strike Price $67.52, Expires
3/14/11, Broker Goldman
Sachs USA

 

 

62,000

 

 

(176,853

)

Strike Price $67.68, Expires
3/24/11, Broker Goldman
Sachs USA

 

 

62,000

 

 

(182,280

)

Pfizer, Inc.:

 

 

 

 

 

 

 

Strike Price $18.34, Expires
3/14/11, Broker Credit Suisse
International

 

 

405,000

 

 

(188,013

)

Strike Price $18.82, Expires
3/31/11, Broker Citibank NA

 

 

193,500

 

 

(66,073

)

Qwest Communications International, Inc.:

 

 

 

 

 

 

 

Strike Price $7.68, Expires
2/03/11, Broker Brown
Brothers

 

 

273,500

 

 

(1,335

)

Strike Price $7.47, Expires
3/07/11, Broker UBS AG

 

 

552,500

 

 

(9,171

)

Strike Price $7.20, Expires
3/16/11, Broker Credit Suisse
International

 

 

425,000

 

 

(57,588

)

Strike Price $7.20, Expires
3/25/11, Broker Credit Suisse
International

 

 

425,000

 

 

(64,855

)

Unilever NV, Strike Price $30.48,
Expires 2/24/11, Broker Morgan
Stanley Capital Services, Inc.

 

 

205,000

 

 

(68,058

)

 

 

 

 

 

 

 

 

 

 

 

(3,088,367

)

Total Options Written
(Premiums Received – $8,147,562) – (1.5)%

 

 

 

 

 

(9,938,941

)

Total Investments, Net of Options Written
(Cost – $660,131,401) – 98.5%

 

 

 

 

 

646,378,920

 

Other Assets Less Liabilities – 1.5%

 

 

 

 

 

9,595,903

 

 

 

 

 

 

Net Assets – 100.0%

 

 

 

 

$

655,974,823

 

 

 

*

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

 

 

 

 

 

Aggregate cost

 

$

705,878,811

 

 

 

Gross unrealized appreciation

 

$

10,942,495

 

Gross unrealized depreciation

 

 

(60,503,445

)

 

 

Net unrealized depreciation

 

$

(49,560,950

)

 

 

 

 

(a)

Security, or portion thereof, pledged/held as collateral for outstanding options written.

 

 

(b)

Non-income producing security.

 

 

 

BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC.

JANUARY 31, 2011

3


 

 

 

 

Schedule of Investments (concluded)

BlackRock Enhanced Capital and Income Fund, Inc. (CII)

 

 

(c)

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
October 31,
2010

 

Net
Activity

 

Shares
Held at
January 31,
2011

 

Income

 

 

 

 

 

 

 

 

 

 

 

BlackRock Liquidity Funds, TempFund, Institutional Class

 

 

11,668,594

 

 

6,825,629

 

 

18,494,223

 

$

10,832

 

 

 

 

(d)

Represents the current yield as of report date.

 

 

 

•

For Fund compliance purposes, the Fund’s industry classifications refer to any one or more of the industry sub-classifications used by one or more widely recognized market indexes or rating group indexes, and/or as defined by Fund management. This definition may not apply for purposes of this report, which may combine such industry sub-classifications for reporting ease.

 

 

 

•

Fair Value Measurements - Various inputs are used in determining the fair value of investments and derivatives, which are as follows:

 

 

 

 

•

Level 1 — 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 and derivatives)

 

 

 

The inputs or methodologies used for valuing securities are not necessarily an indication of the risk associated with 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 tables summarize the inputs used as of January 31, 2011 in determining the fair valuation of the Fund’s investments and derivatives:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Valuation Inputs

 

Level 1

 

Level 2

 

Level 3

 

Total

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

Investments in Securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

Long-Term Investments1

 

$

637,823,638

 

 

—

 

 

—

 

$

637,823,638

 

Short-Term Securities

 

 

18,494,223

 

 

—

 

 

—

 

 

18,494,223

 

Total

 

$

656,317,861

 

 

—

 

 

—

 

$

656,317,861

 

 

 

 

 

1

See the above Schedule of Investments for values in each industry.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Derivative Financial Instruments2

 

Valuation Inputs

 

Level 1

 

Level 2

 

Level 3

 

Total

 

Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity contracts

 

$

(5,433,240

)

$

(4,505,701

)

 

—

 

$

(9,938,941

)

 

 

2

Derivative financial instruments are options, which are shown at value.

 

 

 

4

BLACKROCK ENHANCED CAPITAL AND INCOME FUND, INC.

JANUARY 31, 2011

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 Enhanced Capital and Income Fund, Inc.
   
  By: /s/ John M. Perlowski  
    John M. Perlowski
    Chief Executive Officer (principal executive officer) of
    BlackRock Enhanced Capital and Income Fund, Inc.
   
  Date: March 25, 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 Enhanced Capital and Income Fund, Inc.
   
  Date: March 25, 2011
   
  By: /s/ Neal J. Andrews  
    Neal J. Andrews
    Chief Financial Officer (principal financial officer) of
    BlackRock Enhanced Capital and Income Fund, Inc.
     
  Date: March 25, 2011