PIMCO Municipal Income Fund II may now invest in and originate loans, including below-investment-grade
PIMCO Municipal Income Fund II (PML) said that, effective April 12, 2023, it is permitted to invest in and originate loans as a principal investment strategy, including to borrowers rated below investment grade or unrated. The filing adds a new principal risk factor, Loan Origination Risk, covering potential illiquidity, legal costs and litigation exposure that could be borne by shareholders.
- Effective as of April 12, 2023, the fund may invest in and originate loans as a principal investment strategy, with no stated limit on amount, size or borrower type beyond applicable law.
- The disclosure change will appear in the shareholder report on Form N-CSR for the 12-month period ended December 31, 2023.
- A new risk factor, Loan Origination Risk, notes the fund may have to hold loans for an indeterminate period and bear origination, legal and due diligence expenses borne by common shareholders.