BBN
BlackRock Taxable Municipal Bond Trust
stock NYSE Closed Ended Fund

That drop was interest rates, not fund problems. The Fed jacked up rates fast starting in 2022. Bond prices move opposite to rates, so when rates spike, existing bonds (and the funds holding them) drop in price. Munis are long-duration bonds, so they got hit hard. Leverage in these CEFs (they borrow to buy more bonds) made the drop even sharper. It wasn't these funds doing anything wrong, it was just math.
Was it permanent? Mostly it's mark-to-market, not the funds losing the underlying cash flow. All three you named (NMZ, BBN, IIM) currently have their distributions covered, so trading below NAV right now looks like price marks, not erosion. NMZ is about 9% below its NAV (NAV around $10.37), BBN about 11% below its NAV (NAV around $16.69), and IIM about 5% below its NAV (NAV around $12.53).
Will it happen again? Yes, if rates rise sharply again, munis will drop again, that's just what long-duration bonds do. If rates fall, these should recover some. Nobody can call the Fed's next move for you though.
One thing to flag separately from rates: dividend quality on these is weak, and risk varies more than people assume. NMZ scores 15/100 on dividend quality, yields about 8.31%, and sits at moderate risk with a below-average price trend.
BBN is 25/100 on dividend quality, yields about 7.8%, and is actually low risk, though its price trend is similarly weak and its dividend has been shrinking over the last five years.
IIM dividend quality is also weak - 36/100, yields about 7.71%, is also low risk, and has a price trend that's roughly average, not really "decent," just less bad. So even without a NAV problem, none of these are "high quality" income funds. They're higher-yield munis with mixed risk profiles rather than uniformly high-volatility plays. Don't expect much dividend growth or decent appreciation from any of them.

That drop was interest rates, not fund problems. The Fed jacked up rates fast starting in 2022. Bond prices move opposite to rates, so when rates spike, existing bonds (and the funds holding them) drop in price. Munis are long-duration bonds, so they got hit hard. Leverage in these CEFs (they borrow to buy more bonds) made the drop even sharper. It wasn't these funds doing anything wrong, it was just math.
Was it permanent? Mostly it's mark-to-market, not the funds losing the underlying cash flow. All three you named (NMZ, BBN, IIM) currently have their distributions covered, so trading below NAV right now looks like price marks, not erosion. NMZ is about 9% below its NAV (NAV around $10.37), BBN about 11% below its NAV (NAV around $16.69), and IIM about 5% below its NAV (NAV around $12.53).
Will it happen again? Yes, if rates rise sharply again, munis will drop again, that's just what long-duration bonds do. If rates fall, these should recover some. Nobody can call the Fed's next move for you though.
One thing to flag separately from rates: dividend quality on these is weak, and risk varies more than people assume. NMZ scores 15/100 on dividend quality, yields about 8.31%, and sits at moderate risk with a below-average price trend.
BBN is 25/100 on dividend quality, yields about 7.8%, and is actually low risk, though its price trend is similarly weak and its dividend has been shrinking over the last five years.
IIM dividend quality is also weak - 36/100, yields about 7.71%, is also low risk, and has a price trend that's roughly average, not really "decent," just less bad. So even without a NAV problem, none of these are "high quality" income funds. They're higher-yield munis with mixed risk profiles rather than uniformly high-volatility plays. Don't expect much dividend growth or decent appreciation from any of them.