UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM N-CSR

 

CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES

 

Investment Company Act file number

811-10555

 

PIMCO Corporate Income Fund

(Exact name of registrant as specified in charter)

 

1345 Avenue of the Americas, New York, New York

 

10105

(Address of principal executive offices)

 

(Zip code)

 

Lawrence G. Altadonna - 1345 Avenue of the Americas, New York, New York 10105

(Name and address of agent for service)

 

Registrant’s telephone number, including area code:

212-739-3371

 

 

Date of fiscal year end:

October 31, 2010

 

 

Date of reporting period:

October 31, 2010

 

 

Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles.

 

A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR 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 Secretary, Securities and Exchange Commission, 100 F Street, NE, Washington, DC 20549-2001. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. § 3507.

 



 

Item 1. Report to Shareholders

 

 

October 31, 2010

 

 

PIMCO Corporate Income Fund

PIMCO Income Opportunity Fund

 

 

 


 

Contents

 

Letter to Shareholders

2-3

 

 

Fund Insights/Fund Performance & Statistics

4-9

 

 

Schedules of Investments

10-32

 

 

Statements of Assets and Liabilities

33

 

 

Statements of Operations

34

 

 

Statements of Changes in Net Assets

35-36

 

 

Statements of Cash Flows

37

 

 

Notes to Financial Statements

38-63

 

 

Financial Highlights

64-65

 

 

Report of Independent Registered Public Accounting Firm

66

 

 

Annual Shareholder Meeting Results/Changes to Board of Trustees/Tax Information

67

 

 

Changes in Investment Policies/Portfolio Management Change — Corporate Income

68-69

 

 

Matters Relating to the Trustees’ Consideration of the Investment Management & Portfolio Management Agreements

70-74

 

 

Privacy Policy

75

 

 

Proxy Voting Policies & Procedures

76

 

 

Dividend Reinvestment Plan

77

 

 

Board of Trustees

78-79

 

 

Fund Officers

80

 

 

 

PIMCO Corporate Income Fund

 

 

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PIMCO Income Opportunity Fund Annual Report

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Dear Shareholder:

 

Corporate bond investors enjoyed excellent returns for the fiscal year ended October 31, 2010. These gains were accompanied by a gradual but erratic recovery of both the U.S. and global economies, leaving behind the severe downturn that ended in mid-2009.

 

Hans W. Kertess
Chairman

 

 

Twelve Months in Review

 

For the fiscal year ended October 31, 2010:

 

 

 

· PIMCO Corporate Income Fund returned 38.36% on net asset value (“NAV”) and 41.86% on market price.

 

· PIMCO Income Opportunity Fund returned 37.89% on NAV and 39.51% on market price.

 

Brian S. Shlissel
President & CEO

 

 

The U.S. economy, as measured by gross domestic product (“GDP”) expanded at a revised rate of 2.6% during the third quarter of calendar year 2010. This was a reversal of what had been a de-accelerating trend from the fourth quarter of 2009 to the second quarter of this year, in which GDP fell from a 5.0% to a 1.7% pace. In contrast to that period, which was to a large degree supported by external efforts such as the federal government’s stimulus package, growth now appears to be largely organic. Manufacturing is increasingly robust, exports are picking up and the American consumer is beginning to spend — albeit cautiously — again.

 

 

 

 

 

 

 

 

 

As the economy lost steam, the U.S. Federal Reserve (the “Fed”) revealed that it would resume purchasing U.S. Treasury bonds — a reversal of its position earlier in the year. The goal behind this so-called “quantitative easing” would be to boost economic activity by pushing already low interest rates even lower. The Fed also held the closely-watched Federal Funds rate near zero and indicated it would continue to do so for the foreseeable future. Ben Bernanke, the Fed chairman, described economic conditions as “unusually uncertain.”

 

This uncertainty — along with concerns over changes in taxes and other legislative policies — resulted in continued corporate cost-cutting, and has largely repressed any inclination for companies to spend and hire. Combined with the low cost of capital, this has helped companies amass record amounts of cash. According to Federal Reserve data, at June 30, 2010, corporate America was sitting on an estimated $1.84 trillion — up 18% from June 30, 2009. It is no coincidence, therefore, that corporate debt default rates are plunging. Moody’s Investors Service, which tracks the corporate debt market, predicts default rates will fall below 3% by the end of 2010. This is regarded as a healthy figure, which has not been so low since August 2008.

 

 

PIMCO Corporate Income Fund

 

2

 

PIMCO Income Opportunity Fund Annual Report | 10.31.10

 

 


 

The Road Ahead

We expect the U.S. economy will continue to recover at a sluggish pace. This will probably keep interest rates at record low levels for the near term. In fact, now that the Federal Reserve has indicated that it will embark on another round of quantitative easing, rates may drop even lower. However, lowering rates to boost economic activity is ultimately contradictory, since any significant economic revival would at some point result in higher rates. This interest rate risk, along with credit risk, currency risk and other variables, must be monitored carefully.

 

As 2010 draws to a close, it is clear that this growing economic strength has been largely supportive for corporate bonds. Across virtually every sector of the economy, corporate profits have been solid, and in some cases, spectacular. This is reflected in the record amount of cash held by U.S. Firms — nearly $2 trillion, according to the Federal Reserve. This in turn has meant a declining number of corporate defaults, as most firms can easily meet their debt obligations to bondholders. This has proven to be particularly rewarding for corporate securities with longer maturities or lower credit ratings, a trend that may continue into 2011 as the economy continues to grow. This outlook is tempered to some degree by the possibility that as the expansion continues, it would put upward pressure on interest rates — thus increasing borrowing costs.

 

 

 

Receive this report electronically and eliminate paper mailings. To enroll, go to www.allianzinvestors.com/edelivery.

 

For specific information on the Funds and their performance, please review the following pages. If you have any questions regarding the information provided, we encourage you to contact your financial advisor or call the Funds’ shareholder servicing agent at (800) 254-5197. In addition, a wide range of information and resources are available on our Web site, www.allianzinvestors.com/closedendfunds.

 

Together with Allianz Global Investors Fund Management LLC, the Funds’ investment manager, and Pacific Investment Management Company LLC (“PIMCO”), the Funds’ sub-adviser, we thank you for investing with us.

 

We remain dedicated to serving your investment needs.

 

Sincerely,

 

 

 

 

 

 

 

 

 

Hans W. Kertess

 

Brian S. Shlissel

Chairman

 

President & CEO

 

 

 

PIMCO Corporate Income Fund

 

 

10.31.10 | 

PIMCO Income Opportunity Fund Annual Report

3

 

 


 

PIMCO Corporate Income Fund Fund Insights

October 31, 2010 (unaudited)

 

For the fiscal year ended October 31, 2010, PIMCO Corporate Income Fund returned 38.36% on NAV and 41.86% on market price.

 

The reporting period encompassed a strong environment for corporate debt markets. While there was significant volatility along the way, including intermittent “flight to quality” trades into U.S. Treasuries as concerns about the global economy waxed and waned, overall investors appeared to regain their appetite for credit and emerging markets risk. Relative to the moderate 8.01% return for the core U.S. fixed income market (as measured by the Barclays Capital U.S. Aggregate Index), high yield and investment grade debt returned 19.35% and 11.61%, respectively (as measured by the Barclays Capital U.S. High Yield and U.S. Corporate Indices) for the reporting period.

 

The benefits of strong sector selection

The Fund’s exposure to the life insurance and airline sectors enhanced performance. Life companies were one of the best performing corporate sectors during the period as strong results from key companies boosted the sector’s overall credit profile. Airline issues, particularly enhanced equipment trusts certificates (“EETCs”), gained as the credit of airlines improved, providing support to the valuations of both their unsecured debt and EETC issues.

 

An allocation to emerging market bonds also benefitted returns as the JPMorgan EMBI Global Index advanced 17.70% during the period on investors’ rising risk tolerance as well as relatively strong growth in the developing world.

 

An underweight to deep cyclical credits such as entertainment, gaming, home construction, lodging, retailers, and textile corporate bonds hindered performance relative to the broader corporate bond market, as these issues, represented by the consumer cyclical component of the Barclays Capital U.S. Credit Index, outpaced most other corporate sectors during the period.

 

 

PIMCO Corporate Income Fund

 

4

 

PIMCO Income Opportunity Fund Annual Report | 10.31.10

 

 


 

Despite posting positive returns, the Fund’s tactical exposure to agency mortgage-backed securities (“MBS”), dampened relative performance as these securities, represented by the Barclays Capital Fixed-Rate MBS Index, underperformed most other fixed income sectors during the time period.

 

 

 

PIMCO Corporate Income Fund

 

 

10.31.10 | 

PIMCO Income Opportunity Fund Annual Report

5

 

 


 

PIMCO Corporate Income Fund

Fund Performance & Statistics

October 31, 2010 (unaudited)

 

Total Return(1):

 

Market Price

 

NAV

 

1 Year

 

41.86%

 

38.36

%

 

5 Year

 

13.40%

 

13.44

%

 

Commencement of Operations (12/21/01) to 10/31/10

 

12.12%

 

12.51

%

 

 

Market Price/NAV Performance:

Market Price/NAV:

 

 

 

Commencement of Operations (12/21/01) to 10/31/10

Market Price

 

$16.24

 

 NAV

NAV

 

$15.51

 

 Market Price

Premium to NAV

 

4.71%

 

Market Price Yield(2) 

 

7.85%

 

 

Moody’s Ratings

(as a % of total investments)

 

 

 

 

 

(1) Past performance is no guarantee of future results. Total return is calculated by determining the percentage change in NAV market price (as applicable) in the specified period. The calculation assumes that all income dividends and capital gain distributions, if any, have been reinvested. Total return does not reflect broker commissions or sales charges. Total return for a period of more than one year represents the average annual total return. Performance at market price will differ from its results at NAV. Although market price returns typically reflect investment results over time, during shorter periods, returns at market price can also be influenced by factors such as changing views about the Fund, market conditions, supply and demand for the Fund’s shares, or changes in Fund dividends. An investment in the Fund involves risk, including the loss of principal. Total return, market price, market yield and NAV will fluctuate with changes in market conditions. This data is provided for information purposes only and is not intended for trading purposes. Closed-end funds, unlike open-end funds, are not continuously offered. There is a onetime public offering and once issued, shares of closed-end funds are traded in the open market through a stock exchange. NAV is equal to total assets attributable to common shareholders less total liabilities divided by the number of common shares outstanding. Holdings are subject to change daily.

 

(2) Market Price Yield is determined by dividing the annualized current monthly per share dividend (comprised of net investment income) payable to common shareholders by the market price per common share at October 31, 2010.

 

 

PIMCO Corporate Income Fund

 

6

 

PIMCO Income Opportunity Fund Annual Report | 10.31.10

 

 


 

PIMCO Income Opportunity Fund Fund Insights

October 31, 2010 (unaudited)

 

For the fiscal year ended October 31, 2010, PIMCO Income Opportunity Fund returned 37.89% on NAV and 39.51% on market price.

 

The reporting period encompassed a strong environment for corporate debt markets. While there was significant volatility along the way, including intermittent “flight to quality” trades into U.S. Treasuries as concerns about the global economy waxed and waned, overall investors appeared to regain their appetite for credit and emerging markets risk. Relative to the moderate 8.01% return for the core U.S. fixed income market (as measured by the Barclays Capital U.S. Aggregate Index), high yield and investment grade debt returned 19.35% and 11.61%, respectively (as measured by the Barclays Capital U.S. High Yield and U.S. Corporate Indices) for the reporting period.

 

The benefits of strong sector selection

At the sector level, the Fund’s allocation to high-quality commercial mortgage-backed securities (CMBS) supported performance, as the sector (as measured by the Barclays Capital CMBS Index) posted a strong return due in part to investors’ demand for yield.

 

The Fund’s exposure to the life insurance and airline sectors also enhanced performance. Life insurance companies were one of the best performing corporate sectors during the period, as strong results from key companies boosted the sector’s overall credit profile. Airline issues, particularly enhanced equipment trusts certificates (“EETCs”), gained as the credit of airlines improved, providing support to the valuations of both their unsecured debt and EETC issues.

 

An allocation to emerging market bonds also benefitted returns as the JPMorgan EMBI Global Index advanced 17.70% during the period on investors’ rising risk tolerance as well as relatively strong growth in the developing world.

 

 

 

PIMCO Corporate Income Fund

 

 

10.31.10 | 

PIMCO Income Opportunity Fund Annual Report

7

 

 


 

PIMCO Income Opportunity Fund Fund Insights

October 31, 2010 (unaudited) (continued)

 

An underweight to deep cyclical credits such as entertainment, gaming, home construction, lodging, retailers, and textile corporate bonds hindered performance relative to the broader corporate bond market, as these issues, represented by the consumer cyclical component of the Barclays Capital U.S. Credit Index, outpaced most other corporate sectors during the period.

 

Despite posting positive returns, the Fund’s tactical exposure to agency mortgage-backed securities (“MBS”), dampened relative performance as these securities, represented by the Barclays Capital Fixed-Rate MBS Index, underperformed most other fixed income sectors during the time period.

 

 

PIMCO Corporate Income Fund

 

8

 

PIMCO Income Opportunity Fund Annual Report | 10.31.10

 

 


 

PIMCO Income Opportunity Fund

Fund Performance & Statistics

October 31, 2010 (unaudited)

 

Total Return(1):

 

Market Price

 

NAV

 

1 Year

 

39.51%

 

37.89%

 

Commencement of Operations (11/30/2007) to 10/31/10

 

13.29%

 

15.20%

 

 

Market Price/NAV Performance:

Market Price/NAV:

 

 

 

Commencement of Operations (11/30/2007) to 10/31/10

Market Price

 

$26.92

 

 NAV

NAV

 

$26.97

 

 Market Price

Discount to NAV

 

(0.19)%

 

 

 

Market Price Yield(2) 

 

7.89%

 

 

Moody’s Ratings

(as a % of total investments)

 

 

 

 

(1) Past performance is no guarantee of future results. Total return is calculated by determining the percentage change in NAV or market price (as applicable) in the specified period. The calculation assumes that all income dividends, capital gain and return of capital distributions, if any, have been reinvested. Total return does not reflect broker commissions or sales charges. Total return for a period of more than one year represents the average annual total return. Performance at market price will differ from its results at NAV. Although market price returns typically reflect investment results over time, during shorter periods returns at market price can also be influenced by factors such as changing views about the Fund, market conditions, supply and demand for the Fund’s shares, or changes in Fund dividends. An investment in the Fund involves risk, including the loss of principal. Total return, market price, market yield and NAV will fluctuate with changes in market conditions. This data is provided for information purposes only and is not intended for trading purposes. Closed-end funds, unlike open-end funds, are not continuously offered. There is a onetime public offering and once issued, shares of closed-end funds are traded in the open market through a stock exchange. NAV is equal to total assets less total liabilities divided by the number of common shares outstanding. Holdings are subject to change daily.

 

(2) Market Price Yield is determined by dividing the annualized current monthly per share dividend (comprised of ordinary income) payable to shareholders by the market price per share at October 31, 2010.

 

 

 

PIMCO Corporate Income Fund

 

 

10.31.10 | 

PIMCO Income Opportunity Fund Annual Report

9

 

 


 

PIMCO Corporate Income Fund Schedule of Investments

October 31, 2010

Principal
Amount
(000s)

 

 

 

Credit Rating
(Moody’s/S&P)*

 

Value

 

CORPORATE BONDS & NOTES – 72.3%

 

 

 

 

 

 

 

 

 

 

 

Airlines – 2.4%

 

 

 

 

 

 

 

American Airlines Pass Through Trust,

 

 

 

 

 

$174

 

6.978%, 10/1/12

 

Ba1/BBB

 

$176,756

 

1,000

 

7.858%, 4/1/13 (AGC)

 

Ba1/BBB-

 

1,046,200

 

1,972

 

10.375%, 1/2/21

 

Baa3/A-

 

2,357,137

 

2,300

 

American Airlines, Inc., 10.50%, 10/15/12

 

B2/B

 

2,512,750

 

2,003

 

Continental Airlines Pass Through Trust, 9.798%, 4/1/21

 

Ba3/B

 

2,003,432

 

114

 

Delta Air Lines, Inc., 6.619%, 9/18/12

 

WR/BBB

 

115,973

 

8,601

 

Northwest Airlines, Inc., 7.15%, 4/1/21 (MBIA)

 

Ba3/BB+

 

8,686,666

 

 

 

United Air Lines Pass Through Trust,

 

 

 

 

 

1,425

 

7.336%, 1/2/21 (a) (b) (d) (k)

(acquisition cost-$1,424,623; purchased 6/19/07)

 

Ba2/B+

 

1,367,638

 

2,924

 

10.40%, 5/1/18

 

Baa2/BBB+

 

3,303,636

 

 

 

 

 

 

 

21,570,188

 

Automotive – 0.2%

 

 

 

 

 

1,500

 

Ford Motor Co., 9.98%, 2/15/47

 

Ba3/B

 

1,876,875

 

Banking – 11.0%

 

 

 

 

 

4,000

 

ABN Amro North American Holding Preferred Capital Repackage Trust I, 6.523%, 11/8/12 (a) (d) (h)

 

Ba3/BB

 

3,520,000

 

2,400

 

AgFirst Farm Credit Bank, 7.30%, 11/29/10 (a) (b) (d) (h) (k)
(acquisition cost-$1,904,000; purchased 2/26/10-3/2/10)

 

NR/A

 

2,035,178

 

800

 

Allied Irish Banks PLC, 10.75%, 3/29/17

 

Ba3/BB

 

664,000

 

1,150

 

BankAmerica Capital II, 8.00%, 12/15/26

 

Baa3/BB

 

1,167,250

 

 

 

Barclays Bank PLC,

 

 

 

 

 

4,600

 

7.434%, 12/15/17 (a) (d) (h) (j)

 

Baa2/A-

 

4,715,000

 

7,760

 

10.179%, 6/12/21 (a) (d) (j)

 

Baa1/A

 

10,360,826

 

£200

 

14.00%, 6/15/19 (h)

 

Baa2/A-

 

412,491

 

$2,000

 

HBOS PLC, 6.75%, 5/21/18 (a) (d)

 

Baa3/BBB-

 

2,053,688

 

1,000

 

HSBC Capital Funding L.P., 10.176%, 6/30/30 (h)

 

A3/A-

 

1,325,000

 

25,290

 

Rabobank Nederland NV, 11.00%, 6/30/19 (a) (d) (h) (j)

 

A2/AA-

 

33,864,777

 

 

 

Regions Financial Corp.,

 

 

 

 

 

1,900

 

7.375%, 12/10/37

 

Ba1/BB+

 

1,719,401

 

3,400

 

7.75%, 11/10/14

 

Baa3/BBB-

 

3,723,962

 

31,974

 

State Street Capital Trust III, 8.25%, 3/15/11 (h) (j)

 

Baa1/BBB+

 

32,576,710

 

 

 

 

 

 

 

98,138,283

 

Building & Construction – 0.3%

 

 

 

 

 

1,000

 

Desarrolladora Homex SAB De C.V., 9.50%, 12/11/19 (a) (d)

 

Ba3/BB-

 

1,161,250

 

1,700

 

Macmillan Bloedel Pembroke L.P., 7.70%, 2/15/26

 

Ba1/BBB-

 

1,743,104

 

 

 

 

 

 

 

2,904,354

 

Energy – 0.5%

 

 

 

 

 

4,300

 

Dynegy Roseton/Danskammer Pass Through Trust, 7.67%, 11/8/16, Ser. B

 

Caa2/B-

 

3,999,000

 

Financial Services – 39.4%

 

 

 

 

 

 

 

Ally Financial, Inc.,

 

 

 

 

 

130

 

2.192%, 12/15/11, FRN

 

B3/B

 

127,563

 

50

 

2.227%, 1/16/12, FRN

 

B3/B

 

49,063

 

115

 

2.327%, 1/17/12, FRN

 

B3/B

 

112,844

 

149

 

2.392%, 12/15/11, FRN

 

B3/B

 

146,206

 

100

 

2.407%, 2/15/12, FRN

 

B3/B

 

98,125

 

 

 

 

 

 

 

 

 

 

 

PIMCO Corporate Income Fund

10

 

PIMCO Income Opportunity Fund Annual Report | 10.31.10

 


 

PIMCO Corporate Income Fund Schedule of Investments

October 31, 2010 (continued)

Principal
Amount
(000s)

 

 

 

Credit Rating
(Moody’s/S&P)*

 

Value

 

 

 

 

 

 

 

Financial Services (continued)

 

 

 

 

 

$3,000

 

2.497%, 12/1/14, FRN

 

B3/B

 

$2,685,150

 

76

 

2.557%, 2/15/12, FRN

 

B3/B

 

74,575

 

40

 

2.642%, 3/15/12, FRN

 

B3/B

 

39,250

 

240

 

5.35%, 1/15/14

 

B3/B

 

230,483

 

70

 

5.75%, 1/15/14

 

B3/B

 

68,018

 

372

 

5.85%, 6/15/13

 

B3/B

 

364,035

 

6,650

 

6.00%, 12/15/11

 

B3/B

 

6,786,352

 

225

 

6.00%, 7/15/13

 

B3/B

 

220,791

 

34

 

6.00%, 3/15/19

 

B3/B

 

29,665

 

494

 

6.00%, 9/15/19

 

B3/B

 

432,063

 

492

 

6.05%, 8/15/19

 

B3/B

 

431,373

 

659

 

6.125%, 10/15/19

 

B3/B

 

581,801

 

343

 

6.15%, 9/15/19

 

B3/B

 

303,216

 

5

 

6.15%, 10/15/19

 

B3/B

 

4,422

 

10

 

6.20%, 4/15/19

 

B3/B

 

8,848

 

517

 

6.25%, 12/15/18

 

B3/B

 

458,308

 

10

 

6.25%, 4/15/19

 

B3/B

 

8,868

 

182

 

6.25%, 5/15/19

 

B3/NR

 

161,472

 

10

 

6.25%, 7/15/19

 

B3/B

 

8,892

 

620

 

6.30%, 8/15/19

 

B3/B

 

553,574

 

210

 

6.35%, 5/15/13

 

B3/B

 

208,191

 

5

 

6.35%, 7/15/19

 

B3/B

 

4,477

 

158

 

6.40%, 12/15/18

 

B3/B

 

141,447

 

133

 

6.50%, 2/15/16

 

B3/B

 

126,103

 

771

 

6.50%, 6/15/18

 

B3/B

 

703,812

 

666

 

6.50%, 11/15/18

 

B3/B

 

599,154

 

879

 

6.50%, 12/15/18

 

B3/B

 

791,872

 

11

 

6.50%, 5/15/19

 

B3/B

 

9,940

 

55

 

6.50%, 1/15/20

 

B3/B

 

48,960

 

78

 

6.60%, 5/15/18

 

B3/B

 

72,243

 

476

 

6.65%, 6/15/18

 

B3/B

 

441,257

 

770

 

6.65%, 10/15/18

 

B3/B

 

701,334

 

682

 

6.70%, 6/15/18

 

B3/B

 

631,104

 

250

 

6.70%, 11/15/18

 

B3/B

 

228,079

 

499

 

6.70%, 12/15/19

 

B3/B

 

450,665

 

896

 

6.75%, 7/15/12

 

WR/NR

 

889,398

 

195

 

6.75%, 8/15/16

 

B3/B

 

186,815

 

10

 

6.75%, 6/15/17

 

B3/B

 

9,653

 

26

 

6.75%, 3/15/18

 

B3/B

 

24,509

 

554

 

6.75%, 7/15/18

 

B3/B

 

517,537

 

113

 

6.75%, 9/15/18

 

B3/B

 

104,029

 

432

 

6.75%, 10/15/18

 

B3/B

 

395,649

 

125

 

6.75%, 11/15/18

 

B3/B

 

114,333

 

293

 

6.75%, 5/15/19

 

B3/B

 

268,957

 

182

 

6.75%, 6/15/19

 

B3/B

 

167,336

 

682

 

6.80%, 9/15/18

 

B3/B

 

629,809

 

135

 

6.80%, 10/15/18

 

B3/B

 

124,126

 

30

 

6.85%, 5/15/18

 

B3/B

 

28,219

 

80

 

6.875%, 7/15/18

 

B3/B

 

74,818

 

133

 

6.90%, 6/15/17

 

B3/B

 

129,449

 

535

 

6.90%, 7/15/18

 

B3/B

 

501,404

 

320

 

6.90%, 8/15/18

 

B3/B

 

298,631

 

2,500

 

7.00%, 2/1/12

 

B3/B

 

2,573,118

 

 

 

 

 

 

 

 

 

 

 

 

 

PIMCO Corporate Income Fund

 

 

10.31.10 | 

PIMCO Income Opportunity Fund Annual Report

11

 


 

PIMCO Corporate Income Fund Schedule of Investments

October 31, 2010 (continued)

Principal
Amount
(000s)

 

 

 

Credit Rating
(Moody’s/S&P)*

 

Value

 

 

 

 

 

 

 

Financial Services (continued)

 

 

 

 

 

$133

 

7.00%, 2/15/18

 

B3/B

 

$127,667

 

509

 

7.00%, 5/15/18

 

B3/B

 

481,114

 

60

 

7.00%, 8/15/18

 

B3/B

 

56,335

 

975

 

7.00%, 9/15/18

 

B3/B

 

911,005

 

560

 

7.00%, 11/15/23

 

B3/B

 

504,443

 

107

 

7.05%, 3/15/18

 

B3/B

 

102,635

 

33

 

7.05%, 4/15/18

 

B3/B

 

31,527

 

105

 

7.125%, 10/15/17

 

B3/B

 

102,754

 

148

 

7.15%, 6/15/16

 

B3/B

 

144,931

 

143

 

7.15%, 9/15/18

 

B3/B

 

134,921

 

210

 

7.15%, 1/15/25

 

B3/B

 

188,368

 

270

 

7.25%, 9/15/17

 

B3/B

 

264,694

 

17

 

7.25%, 4/15/18

 

B3/B

 

16,250

 

1,215

 

7.25%, 8/15/18

 

B3/B

 

1,157,653

 

385

 

7.25%, 9/15/18

 

B3/B

 

365,452

 

50

 

7.25%, 3/15/25

 

B3/B

 

45,100

 

227

 

7.30%, 12/15/17

 

B3/B

 

223,005

 

61

 

7.30%, 1/15/18

 

B3/B

 

59,774

 

12,781

 

7.375%, 11/15/16

 

B3/B

 

12,699,713

 

80

 

7.375%, 4/15/18

 

B3/B

 

77,871

 

20

 

7.40%, 12/15/17

 

B3/B

 

19,455

 

16

 

7.50%, 11/15/16

 

B3/B

 

15,930

 

45

 

7.50%, 11/15/17

 

B3/B

 

44,810

 

23

 

7.50%, 12/15/17

 

B3/B

 

22,835

 

27

 

7.625%, 11/15/12

 

B3/B

 

26,991

 

266

 

9.00%, 7/15/20

 

B3/B

 

267,454

 

2,000

 

American Express Co., 6.80%, 9/1/66,
(converts to FRN on 9/1/16)

 

Baa2/BB

 

2,022,500

 

 

 

American General Finance Corp.,

 

 

 

 

 

€1,500

 

4.125%, 11/29/13

 

B3/B

 

1,789,490

 

$5,000

 

5.375%, 10/1/12

 

B3/B

 

4,775,000

 

2,200

 

5.40%, 12/1/15

 

B3/B

 

1,798,500

 

3,000

 

6.90%, 12/15/17

 

B3/B

 

2,512,500

 

5,000

 

BAC Capital Trust XIV, 5.63%, 3/15/12 (h)

 

Ba3/BB

 

3,575,000

 

 

 

BNP Paribas (h),

 

 

 

 

 

13,000

 

5.186%, 6/29/15 (a) (d) (j)

 

Baa1/A

 

12,545,000

 

6,700

 

7.195%, 6/25/37 (a) (d) (j)

 

Baa1/A

 

6,817,250

 

€350

 

7.781%, 7/2/18

 

Baa1/A

 

525,382

 

$3,300

 

C10 Capital SPV Ltd., 6.722%, 12/31/16 (h)

 

NR/B-

 

2,305,684

 

1,790

 

Capital One Bank USA N.A., 8.80%, 7/15/19 (j)

 

A3/BBB

 

2,274,088

 

1,500

 

Capital One Capital V, 10.25%, 8/15/39

 

Baa3/BB

 

1,636,875

 

3,300

 

Capital One Capital VI, 8.875%, 5/15/40

 

Baa3/BB

 

3,506,250

 

1,871

 

Cedar Brakes II LLC, 9.875%, 9/1/13 (a) (d)

 

Baa3/BBB-

 

2,017,847

 

2,000

 

Cemex Finance LLC, 9.50%, 12/14/16 (a) (d)

 

NR/B

 

2,030,000

 

 

 

CIT Group, Inc.,

 

 

 

 

 

487

 

7.00%, 5/1/13

 

B3/B+

 

495,125

 

980

 

7.00%, 5/1/14

 

B3/B+

 

989,713

 

280

 

7.00%, 5/1/15

 

B3/B+

 

280,964

 

466

 

7.00%, 5/1/16

 

B3/B+

 

467,107

 

653

 

7.00%, 5/1/17

 

B3/B+

 

653,134

 

1,600

 

Citigroup, Inc., 6.125%, 8/25/36

 

Baa1/A-

 

1,553,432

 

16,700

 

Citigroup Capital XXI, 8.30%, 12/21/77,
(converts to FRN on 12/21/37)

 

Ba1/BB-

 

17,555,875

 

 

 

 

 

 

 

 

 

 

 

PIMCO Corporate Income Fund

12

 

PIMCO Income Opportunity Fund Annual Report | 10.31.10

 


 

PIMCO Corporate Income Fund Schedule of Investments

October 31, 2010 (continued)

Principal
Amount
(000s)

 

 

 

Credit Rating
(Moody’s/S&P)*

 

Value

 

 

 

 

 

 

 

Financial Services (continued)

 

 

 

 

 

 

 

Credit Agricole S.A. (a) (d) (h),

 

 

 

 

 

$2,800

 

6.637%, 5/31/17

 

A3/A-

 

$2,684,500

 

6,000

 

8.375%, 10/13/19 (j)

 

A3/A-

 

6,585,000

 

€8,000

 

FCE Bank PLC, 7.125%, 1/15/13

 

Ba2/BB-

 

11,814,154

 

 

 

Ford Motor Credit Co. LLC,

 

 

 

 

 

$1,000

 

5.625%, 9/15/15

 

Ba2/B+

 

1,061,974

 

3,700

 

7.80%, 6/1/12

 

Ba2/B+

 

3,989,410

 

3,500

 

8.00%, 12/15/16

 

Ba2/B+

 

4,103,663

 

1,000

 

12.00%, 5/15/15

 

Ba2/B+

 

1,282,950

 

 

 

General Electric Capital Corp.,

 

 

 

 

 

10,100

 

6.375%, 11/15/67, (converts to FRN on 11/15/17) (j)

 

Aa3/A+

 

10,062,125

 

£500

 

6.50%, 9/15/67, (converts to FRN on 9/15/17) (a) (d)

 

Aa3/A+

 

747,439

 

 

 

Goldman Sachs Group, Inc. (j),

 

 

 

 

 

$4,000

 

6.45%, 5/1/36

 

A2/A-

 

4,080,716

 

7,000

 

6.75%, 10/1/37

 

A2/A-

 

7,372,421

 

 

 

International Lease Finance Corp.,

 

 

 

 

 

1,225

 

0.639%, 7/13/12, FRN

 

B1/BB+

 

1,148,505

 

8,800

 

5.30%, 5/1/12

 

B1/BB+

 

8,976,000

 

5,400

 

5.40%, 2/15/12

 

B1/BB+

 

5,521,500

 

6,950

 

5.55%, 9/5/12

 

B1/BB+

 

7,123,750

 

1,500

 

5.65%, 6/1/14

 

B1/BB+

 

1,507,500

 

3,000

 

6.625%, 11/15/13

 

B1/BB+

 

3,105,000

 

1,000

 

8.625%, 9/15/15 (a) (d)

 

B1/BB+

 

1,127,500

 

11,000

 

JPMorgan Chase & Co., 7.90%, 4/30/18 (h)

 

Baa1/BBB+

 

11,765,743

 

7,100

 

JPMorgan Chase Capital XVIII,
6.95%, 8/1/66, (converts to FRN on 8/17/36) (j)

 

A2/BBB+

 

7,168,934

 

4,100

 

JPMorgan Chase Capital XX,

 

 

 

 

 

 

 

6.55%, 9/15/66, (converts to FRN on 9/15/36)

 

A2/BBB+

 

3,991,075

 

 

 

LBG Capital No.1 PLC,

 

 

 

 

 

€300

 

7.375%, 3/12/20

 

Ba3/BB-

 

397,815

 

£100

 

7.588%, 5/12/20

 

Ba3/BB-

 

151,886

 

£400

 

7.869%, 8/25/20

 

Ba3/BB-

 

610,742

 

$12,700

 

7.875%, 11/1/20

 

Ba3/BB-

 

12,636,500

 

17,500

 

8.00%, 6/15/20 (a) (d) (g) (h)

 

NR/B+

 

16,363,448

 

8,500

 

8.50%, 12/17/21 (a) (d) (g) (h)

 

NR/B+

 

7,944,387

 

£300

 

11.04%, 3/19/20

 

Ba3/BB-

 

532,400

 

£3,100

 

LBG Capital No.2 PLC, 9.125%, 7/15/20

 

Ba2/BB

 

4,948,846

 

$13,000

 

Lehman Brothers Holdings, Inc., 6.875%, 5/2/18 (f)

 

WR/NR

 

3,038,750

 

4,100

 

Royal Bank of Scotland Group PLC, 7.648%, 9/30/31 (h)

 

Ba2/BB-

 

3,997,500

 

 

 

SLM Corp.,

 

 

 

 

 

1,151

 

3.535%, 11/1/13, FRN

 

Ba1/BBB-

 

1,057,389

 

€1,500

 

4.75%, 3/17/14

 

Ba1/BBB-

 

1,948,376

 

$3,500

 

5.00%, 10/1/13

 

Ba1/BBB-

 

3,517,524

 

700

 

8.00%, 3/25/20

 

Ba1/BBB-

 

708,789

 

13,500

 

8.45%, 6/15/18

 

Ba1/BBB-

 

14,162,823

 

€4,000

 

Societe Generale, 7.756%, 5/22/13 (h)

 

Baa2/BBB+

 

5,670,794

 

$4,000

 

UBS Preferred Funding Trust II, 7.247%, 6/26/11 (h)

 

Baa3/BBB-

 

4,049,688

 

5,700

 

UBS Preferred Funding Trust V, 6.243%, 5/15/16 (h)

 

Baa3/BBB-

 

5,693,160

 

5,700

 

USB Capital IX, 6.189%, 4/15/11 (h)

 

A3/BBB+

 

4,531,500

 

12,100

 

Wachovia Capital Trust III, 5.80%, 3/15/11 (h)

 

Ba1/A-

 

10,769,000

 

14,000

 

Wells Fargo & Co., 7.98%, 3/15/18 (h)

 

Ba1/A-

 

14,770,000

 

7,200

 

Wells Fargo Capital X, 5.95%, 12/15/86,
(converts to FRN on 12/15/36) (j)

 

Baa2/A-

 

6,746,954

 

 

 

 

 

 

 

 

 

 

 

 

 

PIMCO Corporate Income Fund

 

 

10.31.10 | 

PIMCO Income Opportunity Fund Annual Report

13

 


 

PIMCO Corporate Income Fund Schedule of Investments

October 31, 2010 (continued)

Principal
Amount
(000s)

 

 

 

Credit Rating
(Moody’s/S&P)*

 

Value

 

 

 

 

 

 

 

Financial Services (continued)

 

 

 

 

 

$4,600

 

Wells Fargo Capital XIII, 7.70%, 3/26/13 (h)

 

Ba1/A-

 

$4,795,500

 

 

 

 

 

 

 

350,664,418

 

Food & Beverage – 0.0%

 

 

 

 

 

100

 

American Stores Co., 8.00%, 6/1/26

 

Ba3/B+

 

85,750

 

Healthcare & Hospitals – 2.1%

 

 

 

 

 

 

 

HCA, Inc.,

 

 

 

 

 

10,000

 

7.875%, 2/15/20

 

Ba3/BB

 

11,125,000

 

3,600

 

8.50%, 4/15/19

 

Ba3/BB

 

4,068,000

 

3,500

 

9.625%, 11/15/16, PIK

 

B2/BB-

 

3,815,000

 

 

 

 

 

 

 

19,008,000

 

Hotels/Gaming – 0.6%

 

 

 

 

 

 

 

MGM Resorts International,

 

 

 

 

 

700

 

10.375%, 5/15/14

 

B1/B

 

791,000

 

1,050

 

11.125%, 11/15/17

 

B1/B

 

1,212,750

 

1,000

 

13.00%, 11/15/13

 

B1/B

 

1,193,750

 

2,307

 

Times Square Hotel Trust, 8.528%, 8/1/26 (a) (d)

 

Baa3/BB+

 

2,363,701

 

 

 

 

 

 

 

5,561,201

 

Insurance – 12.8%

 

 

 

 

 

15,700

 

American General Capital II, 8.50%, 7/1/30

 

Ba2/B

 

16,347,625

 

9,000

 

American General Institutional Capital B, 8.125%, 3/15/46 (a) (d)

 

Ba2/B

 

9,225,000

 

 

 

American International Group, Inc.,

 

 

 

 

 

CAD 3,100

 

4.90%, 6/2/14

 

A3/A-

 

2,975,251

 

$5,100

 

6.25%, 5/1/36 (j)

 

A3/A-

 

5,106,375

 

32,750

 

8.175%, 5/15/68, (converts to FRN on 5/15/38)

 

Ba2/BBB

 

35,124,375

 

18,700

 

8.25%, 8/15/18 (j)

 

A3/A-

 

22,416,625

 

£4,000

 

8.625%, 5/22/68, (converts to FRN on 5/22/18)

 

Ba2/BBB

 

6,619,033

 

$2,600

 

Genworth Financial, Inc., 8.625%, 12/15/16 (j)

 

Baa3/BBB

 

2,974,054

 

5,000

 

Metlife Capital Trust IV, 7.875%, 12/15/67 (a) (d)

 

Baa2/BBB

 

5,425,000

 

6,800

 

Pacific Life Insurance Co., 7.90%, 12/30/23 (a) (d) (j)

 

A3/A-

 

8,258,151

 

 

 

 

 

 

 

114,471,489

 

Metals & Mining – 0.5%

 

 

 

 

 

200

 

Freeport-McMoRan Copper & Gold, Inc., 8.375%, 4/1/17

 

Baa3/BBB-

 

226,535

 

4,000

 

Gerdau Holdings, Inc., 7.00%, 1/20/20 (a) (d)

 

NR/BBB-

 

4,555,000

 

 

 

 

 

 

 

4,781,535

 

Paper/Paper Products – 0.1%

 

 

 

 

 

850

 

Norske Skogindustrier ASA, 6.125%, 10/15/15 (a) (d)

 

B2/B-

 

658,750

 

Telecommunications – 1.8%

 

 

 

 

 

8,200

 

Mountain States Telephone & Telegraph Co., 7.375%, 5/1/30

 

Baa3/BBB-

 

8,118,000

 

5,360

 

Qwest Corp., 7.20%, 11/10/26 (j)

 

Baa3/BBB-

 

5,427,000

 

€1,300

 

Wind Acquisition Finance S.A., 11.75%, 7/15/17

 

B2/B+

 

2,032,729

 

 

 

 

 

 

 

15,577,729

 

Transportation – 0.1%

 

 

 

 

 

$688

 

Federal Express Corp. Pass Through Trust, 7.65%, 1/15/14

 

Baa2/BBB

 

690,252

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PIMCO Corporate Income Fund

14

 

PIMCO Income Opportunity Fund Annual Report | 10.31.10

 


 

PIMCO Corporate Income Fund Schedule of Investments

October 31, 2010 (continued)

 

Principal
Amount
(000s)

 

 

 

Credit Rating
(Moody’s/S&P)*

 

Value

 

 

 

 

 

 

 

Utilities – 0.5%

 

 

 

 

 

$1,234

 

East Coast Power LLC, 7.066%, 3/31/12

 

Baa3/BBB

 

$1,270,771

 

2,180

 

FPL Energy Wind Funding LLC, 6.876%, 6/27/17 (a) (d)

 

Ba2/B+

 

2,144,575

 

1,100

 

PPL Capital Funding, Inc., 6.70%, 3/30/67, (converts to FRN on 3/30/17)

 

Ba1/BBB-

 

1,057,346

 

 

 

 

 

 

 

4,472,692

 

Total Corporate Bonds & Notes (cost-$547,736,762)

 

 

 

644,460,516

 

 

 

 

 

 

 

 

 

MORTGAGE-BACKED SECURITIES – 16.4%

 

 

 

 

 

 

 

 

 

 

 

1,913

 

American Home Mortgage Assets, 0.486%, 9/25/46, CMO, FRN

 

Ca/CCC

 

311,260

 

405

 

Banc of America Alternative Loan Trust, 6.00%, 1/25/36, CMO

 

Caa2/NR

 

303,881

 

7,600

 

Banc of America Funding Corp., 6.00%, 3/25/37, CMO

 

Caa1/CCC

 

6,121,108

 

1,450

 

BCRR Trust, 5.858%, 7/17/40, CMO, VRN (a) (d)

 

Aa2/NR

 

1,270,762

 

2,972

 

Bear Stearns Alt-A Trust, 5.354%, 11/25/36, CMO, VRN

 

Caa3/CCC

 

1,861,800

 

3,500

 

Chase Commercial Mortgage Securities Corp., 6.887%, 10/15/32, CMO (a) (d)

 

NR/BB+

 

3,487,015

 

 

 

Chase Mortgage Finance Corp., CMO,

 

 

 

 

 

178

 

5.054%, 12/25/35, FRN

 

NR/CCC

 

170,152

 

4,592

 

5.409%, 3/25/37, FRN

 

Caa2/NR

 

3,831,053

 

3,087

 

6.00%, 7/25/37

 

NR/CCC

 

2,694,054

 

3,800

 

Citicorp Mortgage Securities, Inc., 6.00%, 6/25/36, CMO

 

Caa1/NR

 

3,683,559

 

 

 

Countrywide Alternative Loan Trust, CMO,

 

 

 

 

 

2,580

 

5.75%, 3/25/37

 

Caa3/CCC

 

1,952,974

 

1,390

 

6.50%, 8/25/36

 

Ca/CC

 

1,001,329

 

 

 

Countrywide Home Loan Mortgage Pass Through Trust, CMO,

 

 

 

 

 

4,594

 

5.50%, 10/25/35

 

Caa1/NR

 

4,161,574

 

4,171

 

5.75%, 3/25/37

 

NR/CCC

 

3,633,684

 

1,800

 

6.00%, 2/25/37

 

NR/CCC

 

1,444,628

 

1,600

 

6.00%, 3/25/37

 

NR/CCC

 

1,396,889

 

965

 

6.00%, 4/25/37

 

NR/CCC

 

817,598

 

15,000

 

6.00%, 5/25/37

 

Caa3/NR

 

12,281,640

 

 

 

Credit Suisse Mortgage Capital Certificates, CMO,

 

 

 

 

 

1,994

 

6.00%, 2/25/37

 

NR/CCC

 

1,805,444

 

5,100

 

6.00%, 6/25/37

 

NR/D

 

4,019,713

 

 

 

GSR Mortgage Loan Trust, CMO,

 

 

 

 

 

1,039

 

5.50%, 5/25/36

 

NR/CCC

 

940,789

 

10,411

 

6.00%, 2/25/36

 

NR/CCC

 

9,538,440

 

9,000

 

JPMorgan Chase Commercial Mortgage Securities Corp., 5.653%, 3/18/51, CMO, VRN (a) (d)

 

A1/NR

 

8,550,774

 

 

 

JPMorgan Mortgage Trust, CMO,

 

 

 

 

 

5,631

 

5.00%, 3/25/37

 

NR/CCC

 

4,914,153

 

2,600

 

5.675%, 1/25/37, VRN

 

Caa2/NR

 

2,169,993

 

974

 

6.00%, 8/25/37

 

NR/CCC

 

868,603

 

6,525

 

Morgan Stanley Mortgage Loan Trust, 6.00%, 2/25/36, CMO

 

Caa2/CCC

 

5,348,709

 

2,600

 

Morgan Stanley Reremic Trust, 5.808%, 8/12/45, CMO, VRN (a) (d)

 

A3/NR

 

2,551,148

 

1,548

 

Residential Accredit Loans, Inc., 0.486%, 5/25/37, CMO, FRN

 

Caa2/CCC

 

394,143

 

 

 

 

 

 

 

 

 

 

 

 

PIMCO Corporate Income Fund

 

 

10.31.10 | 

PIMCO Income Opportunity Fund Annual Report

15

 


 

PIMCO Corporate Income Fund Schedule of Investments

October 31, 2010 (continued)

 

Principal

 

 

 

 

 

 

 

Amount

 

 

 

Credit Rating

 

 

 

(000s)

 

 

 

(Moody’s/S&P)*

 

Value

 

 

 

 

 

 

 

 

 

$4,174

 

Residential Asset Mortgage Products, Inc., 6.50%, 12/25/31, CMO

 

NR/BB-

 

$4,147,388

 

1,159

 

Residential Asset Securitization Trust, 6.00%, 9/25/36, CMO

 

Caa3/D

 

693,318

 

 

 

Residential Funding Mortgage Securities I, CMO,

 

 

 

 

 

2,800

 

6.00%, 1/25/37

 

Caa2/NR

 

2,326,083

 

4,915

 

6.25%, 8/25/36

 

Caa1/CCC

 

4,494,837

 

1,300

 

Sequoia Mortgage Trust, 5.338%, 2/20/47, CMO, VRN

 

NR/CCC

 

1,074,499

 

1,501

 

Suntrust Adjustable Rate Mortgage Loan Trust, 5.830%, 2/25/37, CMO, FRN

 

NR/CCC

 

1,192,932

 

 

 

WaMu Mortgage Pass Through Certificates, CMO,

 

 

 

 

 

1,461

 

5.655%, 7/25/37, VRN

 

NR/CC

 

998,011

 

17,632

 

5.758%, 7/25/37, FRN

 

NR/CCC

 

15,310,024

 

2,000

 

5.768%, 2/25/37, FRN

 

NR/CCC

 

1,644,034

 

900

 

5.867%, 9/25/36, VRN

 

NR/CCC

 

737,985

 

 

 

Washington Mutual Alternative Mortgage

 

 

 

 

 

 

 

Pass Through Certificates, CMO, FRN,

 

 

 

 

 

1,594

 

1.113%, 4/25/47

 

Ca/CCC

 

343,208

 

1,511

 

1.193%, 5/25/47

 

Ca/CCC

 

341,602

 

 

 

Wells Fargo Mortgage-Backed Securities Trust, CMO,

 

 

 

 

 

5,287

 

5.043%, 10/25/36, FRN

 

NR/CCC

 

4,291,782

 

866

 

5.220%, 4/25/36, VRN

 

NR/BB+

 

781,471

 

1,573

 

5.404%, 7/25/36, FRN

 

NR/CCC

 

1,260,419

 

9,070

 

5.428%, 7/25/36, FRN

 

NR/CCC

 

7,387,541

 

307

 

5.506%, 5/25/36, FRN

 

Caa2/NR

 

252,206

 

1,800

 

6.00%, 7/25/37

 

B3/BB

 

1,722,111

 

5,700

 

6.00%, 8/25/37

 

Caa1/NR

 

5,386,278

 

Total Mortgage-Backed Securities (cost-$133,073,168)

 

 

 

145,912,598

 

 

 

 

 

 

 

 

 

MUNICIPAL BONDS – 4.9%

 

 

 

 

 

 

 

 

 

 

 

California – 2.7%

 

 

 

 

 

2,400

 

Oakland Unified School Dist., Alameda Cnty., GO, 9.50%, 8/1/34

 

A1/BBB+

 

2,690,208

 

20,000

 

State Public Works Board Rev., 8.361%, 10/1/34, Ser. G-2

 

A2/BBB+

 

21,237,000

 

 

 

 

 

 

 

23,927,208

 

Louisiana – 0.2%

 

 

 

 

 

 

 

New Orleans, Public Improvements, GO, Ser. A,

 

 

 

 

 

800

 

8.30%, 12/1/29

 

A3/BBB

 

864,472

 

820

 

8.55%, 12/1/34

 

A3/BBB

 

868,684

 

300

 

8.80%, 12/1/39

 

A3/BBB

 

320,835

 

 

 

 

 

 

 

2,053,991

 

Texas – 2.0%

 

 

 

 

 

17,200

 

North Texas Tollway Auth. Rev., 8.91%, 2/1/30

 

Baa3/NR

 

17,422,224

 

Total Municipal Bonds (cost-$43,179,647)

 

 

 

43,403,423

 

 

 

 

 

 

 

 

 

 

PIMCO Corporate Income Fund

16

 

PIMCO Income Opportunity Fund Annual Report | 10.31.10

 


 

PIMCO Corporate Income Fund Schedule of Investments

October 31, 2010 (continued)

 

Principal
Amount
(000s)

 

 

 

Credit Rating
(Moody’s/S&P)*

 

Value

 

SENIOR LOANS (a) (c) – 2.4%

 

 

 

 

 

 

 

 

 

 

 

Financial Services – 2.4%

 

 

 

 

 

$20,000

 

American General Finance Corp., 7.25%, 4/21/15

 

 

 

$20,220,320

 

1,078

 

CIT Group, Inc., 6.25%, 8/11/15

 

 

 

1,097,688

 

Total Senior Loans (cost-$20,834,776)

 

 

 

21,318,008

 

 

 

 

 

 

 

 

 

CONVERTIBLE PREFERRED STOCK – 1.6%

 

 

 

 

 

 

 

 

 

 

 

Shares

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Financial Services – 0.9%

 

 

 

 

 

8,050

 

Wells Fargo & Co., 7.50%, 3/15/13, Ser. L (h)

 

Ba1/A-

 

8,050,000

 

Insurance – 0.1%

 

 

 

 

 

163,175

 

American International Group, Inc., 8.50%, 8/1/11

 

Ba2/NR

 

1,199,336

 

Utilities – 0.6%

 

 

 

 

 

90,000

 

PPL Corp., 9.50%, 7/1/13

 

NR/NR

 

5,078,700

 

Total Convertible Preferred Stock (cost-$11,626,301)

 

 

 

14,328,036

 

 

 

 

 

 

 

SOVEREIGN DEBT OBLIGATIONS – 0.7%

 

 

 

 

 

 

 

 

 

 

 

Principal
Amount
(000s)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Brazil – 0.7%

 

 

 

 

 

BRL 8,400

 

Brazil Government International Bond, 12.50%, 1/5/22 (cost-$4,901,834)

 

Baa3/BBB-

 

6,005,481

 

 

 

 

 

 

 

 

 

ASSET-BACKED SECURITIES – 0.4%

 

 

 

 

 

$650

 

Ameriquest Mortgage Securities, Inc., 5.444%, 11/25/35

 

Aaa/AAA

 

677,022

 

2,461

 

GSAA Trust, 6.295%, 6/25/36

 

Caa1/CCC

 

1,670,706

 

1,600

 

Morgan Stanley Mortgage Loan Trust, 6.25%, 7/25/47, VRN

 

Caa2/CCC

 

1,149,702

 

Total Asset-Backed Securities (cost-$3,019,451)

 

 

 

3,497,430

 

 

 

 

 

 

 

PREFERRED STOCK – 0.3%

 

 

 

 

 

 

 

 

 

 

 

Shares

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Banking – 0.0%

 

 

 

 

 

5,100

 

CoBank Acb, 11.00%, 7/1/13, Ser. C (a) (b) (d) (h) (k)
(acquisition cost-$272,850; purchased 2/26/10)

 

NR/A

 

280,181

 

Diversified Financial Services – 0.3%

 

 

 

 

 

100,000

 

Citigroup Capital XIII, 7.875%, 10/30/15 (l)

 

Ba1/BB-

 

2,650,000

 

Total Preferred Stock (cost-$2,772,850)

 

 

 

2,930,181

 

 

 

 

 

 

 

 

 

 

 

PIMCO Corporate Income Fund

 

 

10.31.10 | 

PIMCO Income Opportunity Fund Annual Report

17

 


 

PIMCO Corporate Income Fund Schedule of Investments

October 31, 2010 (continued)

 

Principal
Amount
(000s)

 

 

 

Credit Rating
(Moody’s/S&P)*

 

Value

 

U.S. TREASURY OBLIGATIONS (i) – 0.0%

 

 

 

 

 

 

 

 

 

 

 

$2

 

U.S. Treasury Notes, 0.375%, 8/31/12 (cost-$1,497)

 

 

 

$1,501

 

 

 

 

 

 

 

 

 

SHORT-TERM INVESTMENTS – 1.0%

 

 

 

 

 

 

 

 

 

 

 

Corporate Notes – 0.5%

 

 

 

 

 

Financial Services – 0.5%

 

 

 

 

 

 

 

Ally Financial, Inc., FRN,

 

 

 

 

 

25

 

1.742%, 3/15/11

 

B3/B

 

24,906

 

25

 

1.827%, 4/15/11

 

B3/B

 

24,569

 

54

 

1.877%, 4/15/11

 

B3/B

 

53,069

 

265

 

2.042%, 6/15/11

 

B3/B

 

260,031

 

90

 

2.092%, 9/15/11

 

B3/B

 

87,413

 

50

 

2.157%, 11/15/10

 

B3/B

 

50,062

 

4,000

 

International Lease Finance Corp., 0.62%, 7/1/11, FRN

 

B1/BB+

 

3,944,752

 

Total Corporate Notes (cost-$4,152,853)

 

 

 

4,444,802

 

 

 

 

 

 

 

 

 

U.S. Treasury Bills (i) (n) – 0.0%

 

 

 

 

 

60

 

0.132%, 1/13/11 (cost-$59,984)

 

 

 

59,988

 

Repurchase Agreements – 0.5%

 

 

 

 

 

4,300

 

Barclays Capital, Inc., dated 10/29/10, 0.23%, due 11/1/10, proceeds $4,300,082; collateralized by U.S. Treasury Notes, 1.875%, due 6/30/15, valued at $4,381,849 including accrued interest

 

 

 

4,300,000

 

658

 

State Street Bank & Trust Co., dated 10/29/10, 0.01%, due 11/1/10, proceeds $658,000; collateralized by U.S. Treasury Notes, 2.125%, due 5/31/15, valued at $674,432 including accrued interest

 

 

 

658,000

 

Total Repurchase Agreements (cost-$4,958,000)

 

 

 

4,958,000

 

Total Short-Term Investments (cost-$9,170,837)

 

 

 

9,462,790

 

Total Investments (cost-$776,317,123) – 100.0%

 

 

 

$891,319,964

 

 

 

 

 

 

 

 

 

PIMCO Corporate Income Fund

18

 

PIMCO Income Opportunity Fund Annual Report | 10.31.10

 


 

PIMCO Income Opportunity Fund Schedule of Investments

October 31, 2010

Principal
Amount
(000s)

 

 

 

Credit Rating
(Moody’s/S&P)*

 

Value

 

MORTGAGE-BACKED SECURITIES – 86.9%

 

 

 

 

 

 

 

 

 

 

 

$424

 

Adjustable Rate Mortgage Trust, 3.043%, 1/25/36, CMO, VRN

 

Caa3/CCC

 

$300,262

 

£411

 

Auburn Securities PLC, 0.971%, 10/1/41, CMO, FRN

 

Aaa/AAA

 

587,512

 

$730

 

Banc of America Alternative Loan Trust, 6.25%, 1/25/37, CMO

 

Ca/NR

 

232,438

 

 

 

Banc of America Commercial Mortgage, Inc., CMO,

 

 

 

 

 

2,600

 

5.658%, 6/10/49, VRN (j)

 

Aa3/A-

 

2,713,285

 

3,000

 

5.889%, 7/10/44, VRN (j)

 

NR/A+

 

3,291,720

 

873

 

5.918%, 4/11/36 (a) (d)

 

NR/AA-

 

715,495

 

 

 

Banc of America Funding Corp., CMO,

 

 

 

 

 

506

 

2.868%, 12/20/36, VRN

 

Ba3/AAA

 

483,005

 

2,602

 

3.203%, 12/20/34, VRN

 

NR/A-

 

1,754,636

 

634

 

3.356%, 12/20/34, VRN

 

NR/BB+

 

419,082

 

3,681

 

5.482%, 3/20/36, FRN

 

Caa2/B-

 

2,802,463

 

2,328

 

5.937%, 10/20/46, FRN

 

NR/CCC

 

1,601,207

 

5,000

 

Banc of America Large Loan, Inc., 1.006%, 8/15/29, CMO, FRN (a) (d) (j)

 

Aaa/AA

 

4,125,788

 

 

 

Banc of America Mortgage Securities, Inc., CMO,

 

 

 

 

 

330

 

2.866%, 6/25/35, FRN

 

B2/NR

 

309,005

 

578

 

3.163%, 9/25/34, FRN

 

A2/NR

 

551,926

 

477

 

3.240%, 10/20/46, FRN

 

NR/CCC

 

277,335

 

3,196

 

5.047%, 6/25/35, FRN

 

B3/NR

 

2,880,355

 

4,723

 

5.50%, 4/25/34

 

NR/AAA

 

4,359,185

 

1,524

 

5.75%, 8/25/34 (j)

 

NR/AAA

 

1,564,938

 

€1,971

 

Bancaja Fondo de Titulizacion de Activos, 1.011%, 5/22/50, CMO, FRN

 

Aa3/AAA

 

2,139,590

 

 

 

Bear Stearns Adjustable Rate Mortgage Trust, CMO,

 

 

 

 

 

$2,141

 

2.919%, 10/25/36, VRN

 

NR/CCC

 

1,320,281

 

247

 

2.939%, 9/25/34, VRN

 

Baa2/AA

 

211,590

 

1,004

 

2.995%, 1/25/35, FRN

 

Aa2/AA+

 

880,252

 

1,743

 

4.752%, 5/25/34, FRN (j)

 

A2/A+

 

1,723,877

 

906

 

5.286%, 3/25/35, VRN

 

Caa1/BB-

 

821,067

 

382

 

5.428%, 9/25/34, VRN

 

A2/AA-

 

383,149

 

1,102

 

5.637%, 8/25/47, VRN

 

NR/CCC

 

816,282

 

775

 

5.885%, 6/25/47, VRN

 

NR/CCC

 

619,660

 

 

 

Bear Stearns Alt-A Trust, CMO,

 

 

 

 

 

4,157

 

0.416%, 6/25/46, FRN

 

Ca/CC

 

1,812,801

 

2,318

 

0.606%, 1/25/35, FRN (j)

 

Aa2/AAA

 

1,880,995

 

1,361

 

0.856%, 6/25/34, FRN

 

A3/AAA

 

1,039,580

 

660

 

2.803%, 4/25/35, VRN

 

Ca/CCC

 

385,751

 

1,097

 

3.011%, 5/25/35, VRN

 

Caa2/B-

 

655,747

 

1,082

 

3.047%, 9/25/34, FRN

 

A1/AAA

 

839,186

 

1,185

 

3.509%, 9/25/34, VRN

 

A2/AAA

 

981,267

 

7,650

 

5.211%, 8/25/36, VRN (j)

 

Caa3/D

 

4,231,428

 

1,464

 

5.295%, 11/25/36, VRN

 

Caa3/CCC

 

1,039,865

 

1,934

 

5.334%, 5/25/36, VRN

 

Ca/CC

 

1,210,757

 

696

 

5.358%, 7/25/35, FRN

 

Caa3/CCC

 

483,774

 

138

 

5.508%, 11/25/35, VRN

 

B1/CCC

 

106,084

 

1,290

 

6.126%, 8/25/36, VRN

 

Caa3/CCC

 

855,412

 

 

 

Bear Stearns Commercial Mortgage Securities, CMO,

 

 

 

 

 

2,318

 

0.366%, 3/15/19, FRN (a) (d) (j)

 

Aaa/AA

 

2,230,137

 

2,500

 

5.625%, 3/13/40, VRN (a) (d) (j)

 

NR/BBB

 

2,111,938

 

1,000

 

5.694%, 6/11/50, VRN

 

NR/A+

 

1,078,779

 

4,200

 

5.717%, 6/11/40, VRN (j)

 

Aaa/NR

 

4,559,522

 

 

 

 

 

 

 

 

 

 

 

 

PIMCO Corporate Income Fund

 

 

10.31.10 | 

PIMCO Income Opportunity Fund Annual Report

19

 


 

PIMCO Income Opportunity Fund Schedule of Investments

October 31, 2010 (continued)

Principal
Amount
(000s)

 

 

 

Credit Rating
(Moody’s/S&P)*

 

Value

 

 

 

 

 

 

 

 

 

$1,518

 

7.00%, 5/20/30, VRN (j)

 

Aaa/AAA

 

$1,733,555

 

£719

 

Bluestone Securities PLC, 0.946%, 6/9/43, CMO, FRN

 

NR/AAA

 

1,009,118

 

$5,120

 

CBA Commercial Small Balance Commercial Mortgage, 5.54%, 1/25/39, CMO (a) (d)

 

C/BB-

 

2,723,852

 

 

 

Chase Mortgage Finance Corp., CMO,

 

 

 

 

 

1,746

 

5.50%, 11/25/21

 

Caa1/CCC

 

1,669,561

 

2,600

 

6.00%, 3/25/37

 

Caa3/CCC

 

2,287,390

 

 

 

Citigroup Mortgage Loan Trust, Inc., CMO,

 

 

 

 

 

1,222

 

3.547%, 3/25/37, VRN

 

NR/CCC

 

792,114

 

1,094

 

5.50%, 11/25/35

 

NR/CCC

 

849,443

 

5,500

 

Citigroup/Deutsche Bank Commercial Mortgage Trust, 5.322%, 12/11/49, CMO (j)

 

Aaa/A-

 

5,750,967

 

2,030

 

Commercial Mortgage Pass Through Certificates, 5.306%, 12/10/46, CMO (j)

 

Aaa/NR

 

2,134,984

 

 

 

Countrywide Alternative Loan Trust, CMO,