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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:
  811-10377
 
    
Registrant Name:
  PIMCO Municipal Income Fund
 
    
Address of Principal Executive Offices:
  1345 Avenue of the Americas,
 
  New York, NY 10105
 
    
Name and Address of Agent for Service:
  Lawrence G. Altadonna
 
  1345 Avenue of the Americas,
 
  New York, NY 10105
 
    
Registrant’s telephone number, including area code:
  212-739-3371
 
    
Date of Fiscal Year End:
  April 30, 2011
 
    
Date of Reporting Period:
  January 31, 2011
Form N-Q is to be used by management investment companies, other than small business investment companies registered on Form N-5 (§§ 239.24 and 274.5 of this chapter), to file reports with the Commission, not later than 60 days after the close of the first and third fiscal quarters, pursuant to rule 30b1-5 under the Investment Company Act of 1940 (17 CFR 270.30b1-5). The Commission may use the information provided on Form N-Q in its regulatory, disclosure review, inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-Q, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-Q 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 the 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.   Schedule of Investments
PIMCO Municipal Income Fund Schedule of Investments
January 31, 2011 (unaudited)
                         
Principal                  
Amount         Credit Rating        
(000s)         (Moody’s/S&P)     Value*  
 
MUNICIPAL BONDS & NOTES—97.7%                
       
Alabama—1.0%
                
$ 2,500    
Birmingham-Baptist Medical Centers Special Care Facs. Financing Auth. Rev.,
Baptist Health Systems, Inc., 5.875%, 11/15/24, Ser. A
   Baa2/NR   $ 2,500,775  
       
Huntsville-Redstone Village Special Care Facs. Financing Auth. Rev., Redstone Village Project,
                
  250    
5.50%, 1/1/28
   NR/NR     203,540  
  885    
5.50%, 1/1/43
   NR/NR     639,545  
  1,350    
Montgomery Medical Clinic Board Rev., Jackson Hospital & Clinic, 5.25%, 3/1/31
   Baa2/BBB     1,181,345  
       
 
              
       
 
             4,525,205  
       
 
              
       
 
                
       
Alaska—1.1%
                
  3,280    
Borough of Matanuska-Susitna Rev., Goose Creek Correctional Center, 6.00%, 9/1/32 (AGC)
   Aa1/AA+     3,478,210  
  900    
Industrial Dev. & Export Auth. Rev., Boys & Girls Home, 6.00%, 12/1/36
   NR/NR     495,000  
  2,400    
Northern Tobacco Securitization Corp. Rev., 5.00%, 6/1/46, Ser. A
   Baa3/NR     1,388,544  
       
 
              
       
 
             5,361,754  
       
 
              
       
 
                
       
Arizona—5.2%
                
  5,000    
Apache Cnty. Industrial Dev. Auth. Rev., Tucson Electric Power Co. Project, 5.875%, 3/1/33, Ser. B
   Baa3/BBB-     4,917,800  
       
Health Facs. Auth. Rev.,
                
  2,050    
Banner Health, 5.50%, 1/1/38, Ser. D
   NR/A+     1,953,220  
  2,750    
Beatitudes Campus Project, 5.20%, 10/1/37
   NR/NR     1,988,002  
  2,500    
Maricopa Cnty. Pollution Control Corp. Rev., Southern California Edison Co., 5.00%, 6/1/35, Ser. A
   A1/A     2,355,600  
       
Pima Cnty. Industrial Dev. Auth. Rev., Tucson Electric Power Co., Ser. A,
                
  4,150    
6.375%, 9/1/29
   Baa3/BBB-     4,199,053  
  750    
5.25%, 10/1/40
   Baa3/BBB-     665,812  
  5,000    
Salt River Project Agricultural Improvement & Power Dist. Rev., 5.00%, 1/1/39, Ser. A (g)
   Aa1/AA     4,911,150  
  4,200    
Salt Verde Financial Corp. Rev., 5.00%, 12/1/37
   A3/A     3,542,070  
       
 
              
       
 
             24,532,707  
       
 
              
       
 
                
       
Arkansas—0.4%
                
  8,500    
Dev. Finance Auth. Rev., Arkansas Cancer Research Center Project, zero coupon, 7/1/36 (AMBAC)
   Aa2/NR     1,921,510  
       
 
              
       
 
                
       
California—8.1%
                
  3,000    
Chula Vista Rev., San Diego Gas & Electric, 5.875%, 2/15/34, Ser. B
   Aa3/A+     3,072,090  
  6,000    
Golden State Tobacco Securitization Corp. Rev., 5.00%, 6/1/33, Ser. A-1
   Baa3/BB+     3,957,480  
  2,000    
Health Facs. Financing Auth. Rev., Catholic Healthcare West, 6.00%, 7/1/39, Ser. A
   A2/A     2,002,480  
  4,175    
Montebello Unified School Dist., GO, 5.00%, 8/1/33 (AGM)
   Aa3/AA+     3,964,204  
  5,000    
Orange Cnty. Airport Rev., 5.25%, 7/1/39, Ser. A
   Aa3/AA-     4,807,250  
       
State, GO,
                
  300    
5.00%, 6/1/37
   A1/A-     263,109  
  4,200    
6.00%, 4/1/38
   A1/A-     4,237,296  
       
Statewide Communities Dev. Auth. Rev.,
                
  1,000    
Catholic Healthcare West, 5.50%, 7/1/31, Ser. E
   A2/A     940,900  

 

 

PIMCO Municipal Income Fund Schedule of Investments
January 31, 2011 (unaudited)
                         
Principal                  
Amount         Credit Rating        
(000s)         (Moody’s/S&P)     Value*  
 
       
California (continued)
                
       
Methodist Hospital Project (FHA),
                
$ 2,600    
6.625%, 8/1/29
   Aa2/NR   $ 2,838,758  
  9,500    
6.75%, 2/1/38
   Aa2/NR     10,277,195  
  4,000    
Whittier Union High School Dist., GO, zero coupon, 8/1/25
   NR/AA-     1,700,320  
       
 
              
       
 
             38,061,082  
       
 
              
       
 
                
       
Colorado—0.7%
                
  500    
Confluence Metropolitan Dist. Rev., 5.45%, 12/1/34
   NR/NR     342,555  
  450    
Denver Health & Hospital Auth. Rev., 5.625%, 12/1/40
   NR/BBB     404,883  
  500    
Public Auth. for Colorado Energy Rev., 6.50%, 11/15/38
   A2/A     519,695  
  400    
Regional Transportation Dist., CP, 5.375%, 6/1/31, Ser. A
   Aa3/A-     391,688  
  1,500    
Univ. of Colorado Rev., 5.375%, 6/1/38, Ser. A
   Aa2/AA-     1,515,420  
       
 
              
       
 
             3,174,241  
       
 
              
       
 
                
       
Connecticut—0.2%
                
  1,000    
State Dev. Auth. Rev., Connecticut Light & Power Co., 5.85%, 9/1/28, Ser. A
   Baa1/BBB     986,990  
       
 
              
       
 
                
       
Delaware—0.1%
                
  650    
State Economic Dev. Auth. Rev., Delmarva Power & Light Co., 5.40%, 2/1/31
   Baa2/BBB+     606,359  
       
 
              
       
 
                
       
District of Columbia—1.4%
                
  2,500    
Dist. of Columbia Rev., Brookings Institution, 5.75%, 10/1/39
   Aa3/A+     2,580,225  
  3,895    
Tobacco Settlement Financing Corp. Rev., 6.25%, 5/15/24
   Baa3/BBB     3,905,478  
       
 
              
       
 
             6,485,703  
       
 
              
       
 
                
       
Florida—4.1%
                
  895    
Beacon Lakes Community Dev. Dist., Special Assessment, 6.00%, 5/1/38, Ser. A
   NR/NR     736,415  
  4,000    
Broward Cnty. Water & Sewer Rev., 5.25%, 10/1/34, Ser. A (g)
   Aa2/AA     4,002,200  
  500    
Lee Cnty. Industrial Dev. Auth. Rev., Sara Lee Charter Foundation, 5.375%, 6/15/37, Ser. A
   NR/BB     376,320  
  3,000    
Miami-Dade Cnty. Airport Rev., 5.50%, 10/1/36, Ser. A
     A2/A-       2,884,230  
  1,250    
Miami-Dade Cnty. School Board, CP, 5.375%, 2/1/34, Ser. A (AGC)
   Aa3/AA+     1,251,200  
  3,900    
State Board of Education, GO, 5.00%, 6/1/38, Ser. D (g)
   Aa1/AAA     3,753,594  
  5,685    
State Board of Governors Rev., Florida Univ., 6.50%, 7/1/33
   Aa2/AA     6,272,829  
       
 
              
       
 
             19,276,788  
       
 
              
       
 
                
       
Georgia—0.4%
                
  2,300    
Medical Center Hospital Auth. Rev., Spring Harbor Green Island Project, 5.25%, 7/1/37
   NR/NR     1,716,927  
       
 
              
       
 
                
       
Illinois—5.4%
                
  5,000    
Chicago, GO, 5.00%, 1/1/34, Ser. C (g)
   Aa3/A+     4,306,500  
  1,250    
Chicago Motor Fuel Tax Rev., 5.00%, 1/1/38, Ser. A (AGC)
   Aa3/AA+     1,162,688  
       
Finance Auth. Rev.,
                
  1,000    
Memorial Health Systems, 5.50%, 4/1/39
   A1/A+     894,930  
  400    
OSF Healthcare System, 7.125%, 11/15/37, Ser. A
   A3/A     412,664  
       
Univ. of Chicago,
                
  190    
5.25%, 7/1/41, Ser. 05-A
   Aa1/AA     189,418  
  15,000    
5.50%, 7/1/37, Ser. B (g)
   Aa1/AA     15,393,600  

 

 

PIMCO Municipal Income Fund Schedule of Investments
January 31, 2011 (unaudited)
                         
Principal                  
Amount         Credit Rating        
(000s)         (Moody’s/S&P)     Value*  
 
       
Illinois (continued)
                
$ 1,900    
Springfield Electric Rev., 5.00%, 3/1/36
   A1/AA-   $ 1,727,708  
  1,495    
Univ. of Illinois Rev., 5.25%, 4/1/32, Ser. B (FGIC-NPFGC)
   Aa2/AA-     1,463,112  
       
 
              
       
 
             25,550,620  
       
 
              
       
 
                
       
Indiana—0.7%
                
       
Finance Auth. Rev.,
                
  1,500    
Duke Energy Indiana, Inc., 6.00%, 8/1/39, Ser. B
   NR/A     1,502,955  
  1,000    
U.S. States Steel Corp., 6.00%, 12/1/26
   Ba2/BB     962,950  
  1,000    
Municipal Power Agcy. Rev., 6.00%, 1/1/39, Ser. B
   A1/A+     1,013,750  
       
 
              
       
 
             3,479,655  
       
 
              
       
 
                
       
Iowa—1.8%
                
       
Finance Auth. Rev.,
                
  4,890    
Deerfield Retirement Community, Inc., 5.50%, 11/15/37, Ser. A
   NR/NR     3,081,433  
       
Edgewater LLC Project,
                
  3,500    
6.75%, 11/15/37
   NR/NR     3,067,855  
  1,500    
6.75%, 11/15/42
   NR/NR     1,287,780  
  1,600    
Wedum Walnut Ridge LLC Project, 5.625%, 12/1/45, Ser. A
                
       
 
   NR/NR     930,304  
       
 
              
       
 
             8,367,372  
       
 
              
       
 
                
       
Kansas—1.5%
                
  1,000    
Dev. Finance Auth. Rev., Adventist Health, 5.75%, 11/15/38
   Aa3/AA-     1,018,530  
  1,000    
Lenexa City, Tax Allocation, Center East Project, 6.00%, 4/1/27
   NR/NR     713,190  
  650    
Manhattan Rev., Meadowlark Hills Retirement, 5.125%, 5/15/42, Ser. B
   NR/NR     471,894  
  5,000    
Wichita Hospital Rev., Facs. Improvements, 5.625%, 11/15/31, Ser. III
   NR/A+     4,853,500  
       
 
              
       
 
             7,057,114  
       
 
              
       
 
                
       
Kentucky—1.0%
                
  700    
Dev. Finance Auth. Rev., St. Luke’s Hospital, 6.00%, 10/1/19, Ser. B
   A3/A     702,912  
       
Economic Dev. Finance Auth. Rev.,
Baptist Healthcare Systems, Ser. A,
                
  1,000    
5.375%, 8/15/24
   Aa3/NR     1,031,380  
  1,200    
5.625%, 8/15/27
   Aa3/NR     1,223,988  
  1,000    
Owensboro Medical Healthcare Systems, 6.375%, 6/1/40, Ser. A
   Baa2/NR     925,960  
  1,000    
Ohio Cnty. Pollution Control Rev., Big Rivers Electric Corp., 6.00%, 7/15/31, Ser. A
   Baa1/BBB-     950,760  
       
 
              
       
 
             4,835,000  
       
 
              
       
 
                
       
Louisiana—5.8%
                
       
Local Gov’t Environmental Facs. & Community Dev. Auth. Rev.,
                
  3,930    
Capital Projects & Equipment Acquisition, 6.55%, 9/1/25 (ACA)
   NR/NR     3,915,852  
  400    
Westlake Chemical Corp., 6.50%, 11/1/35, Ser. A-2
   Ba2/BBB-     400,232  
  750    
Woman’s Hospital Foundation, 5.875%, 10/1/40, Ser. A
   A3/BBB+     676,852  
  24,395    
Tobacco Settlement Financing Corp. Rev., 5.875%, 5/15/39, Ser. 2001-B
   Baa3/A-     22,430,715  
       
 
              
       
 
             27,423,651  
       
 
              
       
 
                
       
Maryland—0.4%
                
  1,500    
Economic Dev. Corp. Rev., 5.75%, 6/1/35, Ser. B
   Baa3/NR     1,375,230  
  650    
Health & Higher Educational Facs. Auth. Rev., Charlestown Community, 6.25%, 1/1/41
   NR/NR     619,612  
       
 
              
       
 
             1,994,842  
       
 
              

 

 

PIMCO Municipal Income Fund Schedule of Investments
January 31, 2011 (unaudited)
                         
Principal                  
Amount         Credit Rating        
(000s)         (Moody’s/S&P)     Value*  
 
       
Massachusetts—0.6%
                
       
Dev. Finance Agcy. Rev., Ser. A,
                
$ 750    
Foxborough Regional Charter School, 7.00%, 7/1/42
   NR/BBB   $ 750,960  
  550    
Linden Ponds, Inc. Fac., 5.75%, 11/15/35
   NR/NR     380,199  
  1,500    
State College Building Auth. Rev., 5.50%, 5/1/39, Ser. A
   Aa2/AA-     1,550,040  
       
 
              
       
 
             2,681,199  
       
 
              
       
 
                
       
Michigan—1.6%
                
  1,000    
Detroit, GO, 5.375%, 4/1/17, Ser. A-1 (NPFGC)
   Baa1/BBB     965,820  
  4,550    
Garden City Hospital Finance Auth. Rev., 5.00%, 8/15/38, Ser. A
   NR/NR     2,889,159  
       
Royal Oak Hospital Finance Auth. Rev., William Beaumont Hospital,
                
  50    
5.25%, 11/15/35, Ser. M (NPFGC)
   A1/A     41,276  
  1,500    
8.25%, 9/1/39
   A1/A     1,689,375  
  2,000    
Strategic Fund Rev., Detroit Edison Co. Pollution Control, 5.45%, 9/1/29, Ser. C
   A2/A     1,981,480  
       
 
              
       
 
             7,567,110  
       
 
              
       
 
                
       
Minnesota—0.4%
                
  95    
Agricultural & Economic Dev. Board Rev., Health Care Systems, 6.375%, 11/15/29, Ser. A
   A2/A     95,394  
  100    
Duluth Housing & Redev. Auth. Rev., 5.875%, 11/1/40, Ser. A
   NR/BBB-     85,334  
  1,500    
St. Louis Park Rev., Nicollett Health Services, 5.75%, 7/1/39
   NR/A     1,423,650  
  500    
Washington Cnty. Housing & Redev. Auth. Rev., Birchwood & Woodbury Projects, 5.625%, 6/1/37, Ser. A
   NR/NR     423,045  
       
 
              
       
 
             2,027,423  
       
 
              
       
 
                
       
Missouri—0.2%
                
  1,000    
Joplin Industrial Dev. Auth. Rev., Christian Homes, Inc., 5.75%, 5/15/26, Ser. F
   NR/NR     882,840  
       
 
              
       
 
                
       
Montana—0.2%
                
  1,000    
Forsyth Pollution Control Rev., 5.00%, 5/1/33, Ser. A
   A3/A-     949,730  
       
 
              
       
 
                
       
Nevada—3.9%
                
       
Clark Cnty., GO,
                
  5,000    
4.75%, 6/1/30 (AGM)
   Aa1/AA+     4,563,700  
  5,230    
4.75%, 11/1/35 (FGIC-NPFGC)
   Aa1/AA+     4,713,590  
  9,755    
Washoe Cnty., Water & Sewer, GO, 5.00%, 1/1/35 (NPFGC)
   Aa1/AA     9,082,197  
       
 
              
       
 
             18,359,487  
       
 
              
       
 
                
       
New Hampshire—0.6%
                
  3,000    
Business Finance Auth. Pollution Control Rev., Connecticut Light & Power Co., 5.85%, 12/1/22, Ser. A
   Baa1/BBB     3,033,000  
       
 
              
       
 
                
       
New Jersey—6.3%
                
  2,000    
Economic Dev. Auth. Rev., School Facs. Construction, 5.50%, 12/15/34, Ser. Z (AGC)
   Aa3/AA+     2,055,080  
  16,550    
Economic Dev. Auth., Special Assessment, Kapkowski Road Landfill Project, 5.75%, 4/1/31
   Ba2/NR     15,060,997  
  1,000    
Health Care Facs. Financing Auth. Rev., Trinitas Hospital, 5.25%, 7/1/30, Ser. A
   Baa3/BBB-     863,190  

 

 

PIMCO Municipal Income Fund Schedule of Investments
January 31, 2011 (unaudited)
                         
Principal                  
Amount         Credit Rating        
(000s)         (Moody’s/S&P)     Value*  
 
       
New Jersey (continued)
                
$ 2,000    
State Turnpike Auth. Rev., 5.25%, 1/1/40, Ser. E
   A3/A+   $ 1,994,000  
       
Tobacco Settlement Financing Corp. Rev., Ser. 1-A
                
  6,600    
4.75%, 6/1/34
   Baa3/BB+     4,004,748  
  9,100    
5.00%, 6/1/41
   Baa3/BB-     5,483,023  
       
 
              
       
 
             29,461,038  
       
 
              
       
 
                
       
New Mexico—1.4%
                
  1,000    
Farmington Pollution Control Rev., 5.90%, 6/1/40, Ser. D
   Baa3/BB+     945,430  
  6,400    
Hospital Equipment Loan Council Rev., Presbyterian Healthcare, 5.00%, 8/1/39
   Aa3/AA-     5,864,896  
       
 
              
       
 
             6,810,326  
       
 
              
       
 
                
       
New York—7.6%
                
       
Liberty Dev. Corp. Rev., Goldman Sachs Headquarters,
                
  7,500    
5.25%, 10/1/35
   A1/A     7,267,650  
  3,000    
5.50%, 10/1/37
   A1/A     3,008,100  
  4,200    
Nassau Cnty. Industrial Dev. Agcy. Rev., Amsterdam at Harborside, 6.70%, 1/1/43, Ser. A
   NR/NR     3,761,982  
       
New York City Municipal Water Finance Auth. Water & Sewer Rev.,
                
  13,000    
5.00%, 6/15/26, Ser. E (g)
   Aa1/AAA     13,097,630  
  670    
5.00%, 6/15/37, Ser. D (g)
   Aa1/AAA     650,845  
  3,000    
Second Generation Resolutions, 5.00%, 6/15/39, Ser. GG-1
   Aa2/AA+     2,902,680  
  3,500    
State Dormitory Auth. Rev., The New School, 5.50%, 7/1/40
   A3/A-     3,381,175  
  1,625    
Westchester Cnty. Healthcare Corp. Rev., 5.875%, 11/1/25, Ser. A
   A3/BBB     1,572,740  
       
 
              
       
 
             35,642,802  
       
 
              
       
 
                
       
North Carolina—1.3%
                
       
Capital Facs. Finance Agcy. Rev., Ser. A,
                
  2,750    
Duke Energy, 4.625%, 11/1/40
   A1/A     2,447,390  
  570    
Duke Univ. Project, 5.125%, 10/1/41
   Aa1/AA+     570,348  
       
Medical Care Commission Rev.,
                
  2,500    
Novant Health, 5.00%, 11/1/43, Ser. A
   A1/A+     2,160,725  
  1,500    
Village at Brookwood, 5.25%, 1/1/32
   NR/NR     1,114,695  
       
 
              
       
 
             6,293,158  
       
 
              
       
 
                
       
Ohio—1.9%
                
  11,000    
Buckeye Tobacco Settlement Financing Auth. Rev., 5.875%, 6/1/47, Ser. A-2
   Baa3/BB-     7,213,800  
  500    
Higher Educational Fac. Commission Rev., Univ. Hospital Health Systems, 6.75%, 1/15/39, Ser. 2009-A
   A2/A     514,405  
  500    
Lorain Cnty. Port Auth. Rev., U.S. Steel Corp. Project, 6.75%, 12/1/40
   Ba2/BB     501,005  
  500    
Montgomery Cnty. Rev., Miami Valley Hospital, 6.25%, 11/15/39, Ser. A
   Aa3/NR     508,000  
  250    
State Rev., Ashland Univ. Project, 6.25%, 9/1/24
   Ba1/NR     244,513  
       
 
              
       
 
             8,981,723  
       
 
              
       
 
                
       
Oregon—0.6%
                
  2,000    
Oregon Health & Science Univ. Rev., 5.75%, 7/1/39, Ser. A
   A1/A     2,013,120  
  600    
State Department of Administrative Services, CP, 5.25%, 5/1/39, Ser. A
   Aa2/AA-     578,562  
       
 
              
       
 
             2,591,682  
       
 
              

 

 

PIMCO Municipal Income Fund Schedule of Investments
January 31, 2011 (unaudited)
                         
Principal                  
Amount         Credit Rating        
(000s)         (Moody’s/S&P)     Value*  
 
       
Pennsylvania—4.9%
                
$ 5,000    
Geisinger Auth. Rev., 5.25%, 6/1/39, Ser. A
   Aa2/AA   $ 4,793,550  
  2,000    
Harrisburg Auth. Rev., Harrisburg Univ. of Science, 6.00%, 9/1/36, Ser. B
   NR/NR     1,670,540  
       
Higher Educational Facs. Auth. Rev.,
                
  500    
Edinboro Univ. Foundation, 6.00%, 7/1/43
   Baa3/BBB-     460,050  
  350    
Thomas Jefferson Univ., 5.00%, 3/1/40
   A1/AA-     329,077  
       
Lancaster Cnty. Hospital Auth. Rev., Brethren Village Project, Ser. A,
                
  750    
6.25%, 7/1/26
   NR/NR     690,135  
  85    
6.375%, 7/1/30
   NR/NR     76,333  
  1,100    
Luzerne Cnty. Industrial Dev. Auth. Rev., Pennsylvania American Water Co.,
5.50%, 12/1/39
   A2/A     1,059,916  
  7,000    
Philadelphia, GO, 5.25%, 12/15/32, Ser. A (AGM)
   Aa3/AA+     6,778,450  
  4,700    
Philadelphia Hospitals & Higher Education Facs. Auth. Rev., Temple Univ. Hospital, 6.625%, 11/15/23, Ser. A
   Baa3/BBB     4,700,000  
  500    
Philadelphia Water Rev., 5.25%, 1/1/36, Ser. A
   A1/A     484,445  
  2,000    
Turnpike Commission Rev., 5.125%, 12/1/40, Ser. D
   A3/A-     1,846,560  
       
 
              
       
 
             22,889,056  
       
 
              
       
 
                
       
Puerto Rico—1.2%
                
  135    
Commonwealth of Puerto Rico, Public Improvements, GO, 5.00%, 7/1/35, Ser. B
   A3/BBB-     113,558  
       
Sales Tax Financing Corp. Rev.,
                
  32,550    
zero coupon, 8/1/54, Ser. A (AMBAC)
   Aa2/AA-     1,501,206  
  29,200    
zero coupon, 8/1/56, Ser. A
   Aa2/AA-     1,168,876  
  3,000    
5.375%, 8/1/38, Ser. C
   A1/A+     2,767,890  
       
 
              
       
 
             5,551,530  
       
 
              
       
 
                
       
Rhode Island—4.4%
                
  23,800    
Tobacco Settlement Financing Corp. Rev., 6.25%, 6/1/42, Ser. A
   Baa3/BBB     20,946,142  
       
 
              
       
 
                
       
South Carolina—1.7%
                
       
Greenwood Cnty. Hospital Rev., Self Memorial Hospital,
                
  3,500    
5.50%, 10/1/21
   A2/A+     3,510,990  
  2,000    
5.50%, 10/1/26
   A2/A+     1,959,780  
  450    
Jobs-Economic Dev. Auth. Rev., Lutheran Homes, 5.50%, 5/1/28
   NR/NR     371,597  
  2,200    
State Ports Auth. Rev., 5.25%, 7/1/40
   A1/A+     2,113,980  
       
 
              
       
 
             7,956,347  
       
 
              
       
 
                
       
Tennessee—4.8%
                
  940    
Memphis Health Educational & Housing Fac. Board Rev., Wesley Housing Corp. Project, 6.95%, 1/1/20 (a)(b)(d)(h) (acquisition cost-$935,300; purchased 6/29/01)
   NR/NR     472,350  
  5,000    
Metropolitan Gov’t Nashville & Davidson Cnty. Health & Educational Facs. Board Rev., Vanderbilt Univ., 5.00%, 10/1/39, Ser. B (g)
   Aa2/AA     5,031,100  
       
Tennessee Energy Acquisition Corp. Rev.,
                
  370    
5.00%, 2/1/21, Ser. C
   Baa3/BBB     360,913  
  5,000    
5.00%, 2/1/27, Ser. C
   Baa3/BBB     4,609,550  
  6,460    
5.25%, 9/1/17, Ser. A
   Ba3/B     6,563,812  
  600    
5.25%, 9/1/21, Ser. A
   Ba3/B     577,632  
  300    
5.25%, 9/1/22, Ser. A
   Ba3/B     287,316  

 

 

PIMCO Municipal Income Fund Schedule of Investments
January 31, 2011 (unaudited)
                         
Principal                  
Amount         Credit Rating        
(000s)         (Moody’s/S&P)     Value*  
 
       
Tennessee (continued)
                
$ 5,000    
5.25%, 9/1/24, Ser. A
   Ba3/B   $ 4,705,150  
       
 
              
       
 
             22,607,823  
       
 
              
       
Texas—8.7%
                
  10,000    
Coppell Independent School Dist., GO, zero coupon, 8/15/29 (PSF-GTD)
   Aaa/AAA     3,882,900  
  1,200    
Dallas Rev., Dallas Civic Center, 5.25%, 8/15/38 (AGC)
   Aa3/AA+     1,142,976  
  20    
Duncanville Independent School Dist., GO, 5.25%, 2/15/32, Ser. B (PSF-GTD)
   Aaa/AAA     20,147  
       
North Harris Cnty. Regional Water Auth. Rev.,
                
  4,200    
5.25%, 12/15/33
   A1/A+     4,042,878  
  4,200    
5.50%, 12/15/38
   A1/A+     4,094,538  
       
North Texas Tollway Auth. Rev.,
                
  3,000    
5.25%, 1/1/44, Ser. C
   A2/A-     2,572,320  
  6,050    
5.625%, 1/1/33, Ser. A
   A2/A-     5,782,106  
  600    
5.75%, 1/1/33, Ser. F
   A3/BBB+     568,530  
  250    
San Juan Higher Education Finance Auth. Rev., 6.70%, 8/15/40, Ser. A
   NR/BBB     249,672  
  400    
State Public Finance Auth. Rev., Charter School Finance Corp., 5.875%, 12/1/36, Ser. A
   Baa3/BBB-     362,856  
  4,000    
Tarrant Cnty. Cultural Education Facs. Finance Corp. Rev., Baylor Health Care Systems Project, 6.25%, 11/15/29
   Aa2/AA-     4,221,120  
       
Texas Municipal Gas Acquisition & Supply Corp. I Rev.,
                
  6,500    
5.25%, 12/15/23, Ser. A
   A2/A     6,160,830  
  150    
5.25%, 12/15/25, Ser. A
   A2/A     139,751  
  6,500    
6.25%, 12/15/26, Ser. D
   A2/A     6,724,965  
  1,000    
Uptown Dev. Auth., Tax Allocation, Infrastructure Improvement Facs., 5.50%, 9/1/29
   NR/BBB+     957,230  
       
 
              
       
 
             40,922,819  
       
 
              
       
 
                
       
U. S. Virgin Islands—0.1%
                
  500    
Virgin Islands Public Finance Auth. Rev., 5.00%, 10/1/39, Ser. A-1
   Baa2/BBB     407,445  
       
 
              
       
 
                
       
Utah—1.5%
                
  7,000    
Salt Lake Cnty. Rev., IHC Health Services, 5.125%, 2/15/33 (AMBAC)
   WR/AA+     7,087,500  
       
 
              
       
 
                
       
Virginia—0.6%
                
  1,000    
Fairfax Cnty. Industrial Dev. Auth. Rev., Inova Health Systems, 5.50%, 5/15/35, Ser. A
   Aa2/AA+     1,001,890  
  1,985    
Peninsula Town Center Community Dev. Auth. Rev., 6.45%, 9/1/37
   NR/NR     1,816,176  
       
 
              
       
 
             2,818,066  
       
 
              
       
 
                
       
Washington—1.1%
                
       
Health Care Facs. Auth. Rev.,
                
  700    
Multicare Health Systems, 6.00%, 8/15/39, Ser. B (AGC)
   Aa3/AA+     717,815  
  250    
Seattle Cancer Care Alliance, 7.375%, 3/1/38
   A3/NR     265,495  
  2,000    
Virginia Mason Medical Center, 6.125%, 8/15/37, Ser. A
   Baa2/BBB     1,855,840  
       
State Housing Finance Commission Rev., Skyline at First Hill Project, Ser. A
                
  275    
5.25%, 1/1/17
   NR/NR     237,916  
  3,600    
5.625%, 1/1/38
   NR/NR     2,219,292  
       
 
              
       
 
             5,296,358  
       
 
              

 

 

PIMCO Municipal Income Fund Schedule of Investments
January 31, 2011 (unaudited)
                         
Principal                  
Amount         Credit Rating        
(000s)         (Moody’s/S&P)     Value*  
 
       
Wisconsin—2.8%
                
$ 2,230    
Health & Educational Facs. Auth. Rev.,
                
       
Kenosha Hospital & Medical Center Project, 5.625%, 5/15/29
   NR/A   $ 2,116,359  
  500    
Prohealth Care, Inc., 6.625%, 2/15/39
   A1/A+     515,820  
  10,000    
State Rev., 6.00%, 5/1/36, Ser. A
   Aa3/AA-     10,584,900  
       
 
              
       
 
             13,217,079  
       
 
              
       
Total Municipal Bonds & Notes (cost—$474,597,160)
             460,339,203  
       
 
              
       
 
                
VARIABLE RATE NOTES (a)(c)(e)(f)—2.3%                
       
Illinois—0.5%
                
  3,000    
Metropolitan Pier & Exposition Auth. Rev., 8.23%, 6/15/50, Ser. 3217
   NR/AAA     2,163,060  
       
 
              
       
 
                
       
Texas—0.4%
                
  1,000    
JPMorgan Chase Putters/Drivers Trust, GO, 7.824%, 2/1/17, Ser. 3480
   NR/AA+     1,007,090  
       
JPMorgan Chase Putters/Drivers Trust Rev.,
                
  200    
8.25%, 2/1/27, Ser. 3224
   Aa1/NR     219,750  
  600    
8.334%, 10/1/31, Ser. 3227
   NR/AAA     658,578  
       
 
              
       
 
             1,885,418  
       
 
              
       
 
                
       
Washington—1.4%
                
  6,670    
JPMorgan Chase Putters/Drivers Trust, GO, 11.298%, 8/1/28, Ser. 3388
   NR/AA+     6,614,572  
       
 
              
       
Total Variable Rate Notes (cost—$11,353,206)
             10,663,050  
       
 
              
       
 
                
       
Total Investments (cost—$485,950,366) (i)—100.0%
           $ 471,002,253  
       
 
              

 

 

Notes to Schedule of Investments:
 
*   Portfolio securities and other financial instruments for which market quotations are readily available are stated at market value. Market value is generally determined on the basis of last reported sales prices, or if no sales are reported, on the basis of quotes obtained from a quotation reporting system, established market makers, or independent pricing services.
 
    Portfolio securities and other financial instruments for which market quotations are not readily available, or for which a development/event occurs that may significantly impact the value of a security, are fair-valued, in good faith, pursuant to procedures established by the Board of Trustees, or persons acting at their discretion pursuant to procedures established by the Board of Trustees. The Fund’s investments are valued daily using prices supplied by an independent pricing service or dealer quotations, or by using the last sale price on the exchange that is the primary market for such securities, or the mean between the last quoted bid and ask price. Independent pricing services use information provided by market makers or estimates of market values obtained from yield data relating to investments or securities with similar characteristics. Short term securities maturing in 60 days or less are valued at amortized cost, if their original term to maturity was 60 days or less, or by amortizing their value on the 61st day prior to maturity, if the original term to maturity exceeded 60 days.
 
    The prices used by the Fund to value securities may differ from the value that would be realized if the securities were sold and these differences could be material. The Fund’s net asset value is normally determined as of the close of regular trading (normally, 4:00 p.m. Eastern time) on the New York Stock Exchange (“NYSE”) on each day the NYSE is open for business.
 
(a)   Private Placement—Restricted as to resale and may not have a readily available market. Securities with an aggregate value of $11,135,400, representing 2.4% of total investments.
 
(b)   Illiquid.
 
(c)   144A—Exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, typically only to qualified institutional buyers. Unless otherwise indicated, these securities are not considered to be illiquid.
 
(d)   In default.
 
(e)   Inverse Floater—The interest rate shown bears an inverse relationship to the interest rate on another security or the value of an index. The interest rate disclosed reflects the rate in effect on January 31, 2011.
 
(f)   Variable Rate Notes—Instruments whose interest rates change on specified date (such as a coupon date or interest payment date) and/or whose interest rates vary with changes in a designated base rate (such as the prime interest rate). The interest rate disclosed reflects the rate in effect on January 31, 2011.
 
(g)   Residual Interest Bonds held in Trust—Securities represent underlying bonds transferred to a separate securitization trust established in a tender option bond transaction in which the Fund acquired the residual interest certificates. These securities serve as collateral in a financing transaction.
 
(h)   Restricted. The aggregate acquisition cost of such securities is $935,300 and the aggregate market value is $472,350, representing 0.1% of total investments.
 
(i)   At January 31, 2011, the cost basis of investments for federal income tax purposes was $459,426,604. Aggregate gross unrealized appreciation for securities in which there was an excess value over tax cost was $15,424,855; aggregate gross unrealized depreciation for securities in which there was an excess of tax cost over value was $31,906,113; and net unrealized depreciation for federal income tax purposes was $16,481,258. The difference between book and tax cost was attributable to inverse floater transactions.
Glossary:
ACA—insured by American Capital Access Holding Ltd.
AGC—insured by Assured Guaranty Corp.
AGM—insured by Assured Guaranty Municipal Corp.
AMBAC—insured by American Municipal Bond Assurance Corp.
CP—Certificates of Participation
FGIC—insured by Financial Guaranty Insurance Co.
FHA—insured by Federal Housing Administration
GO—General Obligation Bond
GTD—Guaranteed
NPFGC—insured by National Public Finance Guarantee Corp.
NR—Not Rated
PSF—Public School Fund
WR—Withdrawn Rating
Other Investments:
(A) Interest rate swap agreements outstanding at January 31, 2011:
                                                         
                    Rate Type             Upfront      
    Notional Amount     Termination     Payments     Payments     Market     Premiums     Unrealized  
    Swap Counterparty   (000s)     Date     Made     Received     Value     Received     Depreciation  
 
Citigroup
   $ 14,400       6/20/42       (4.75)%     3-Month USD-LIBOR   $ (245,460 )   $ (244,800 )   $ (660 )
 
                                                      
 
    LIBOR — London Inter-Bank Offered Rate
(B) Reverse repurchase agreements:
The weighted average daily balance of reverse repurchase agreements outstanding during the nine months ended January 31, 2011 was $9,068,689 at a weighted average interest rate of 0.67%. There were no open reverse repurchase agreements at January 31, 2011.

 

 

Fair Value Measurements
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e. the “exit price”) in an orderly transaction between market participants. The three levels of the fair value hierarchy are described below:
  •   Level 1 — quoted prices in active markets for identical investments that the Fund has the ability to access
 
  •   Level 2 — valuations based on other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.) or quotes from inactive exchanges
 
  •   Level 3 — valuations based on significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments)
An investment asset’s or liability’s level within the fair value hierarchy is based on the lowest level input, individually or in the aggregate, that is significant to fair value measurement. The objective of fair value measurement remains the same even when there is a significant decrease in the volume and level of activity for an asset or liability and regardless of the valuation technique used.
The valuation techniques used by the Fund to measure fair value during the nine months ended January 31, 2011 maximized the use of observable inputs and minimized the use of unobservable inputs.
The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. The following are certain inputs and techniques that the Fund generally uses to evaluate how to classify each major category of assets and liabilities for Level 2 and Level 3, in accordance with Generally Accepted Accounting Principles.
Municipal Bonds and Variable Rate Notes — Municipal bonds and variable rate notes are valued by independent pricing services based on pricing models that take into account, among other factors, information received from market makers and broker-dealers, current trades, bid-want lists, offerings, market movements, the callability of the bond, state of issuance, benchmark yield curves, and bond insurance. To the extent that these inputs are observable, the values of municipal bonds and variable rate notes are categorized as Level 2. To the extent that these inputs are unobservable the values are categorized as Level 3.
Interest Rate Swaps — Interest rate swaps are valued by independent pricing services using pricing models that are based on real-time intraday snapshots of relevant interest rate curves that are built using the most actively traded securities for a given maturity. The pricing models also incorporate cash and money market rates. In addition, market data pertaining to interest rate swaps is monitored regularly to ensure that interest rates are properly depicting the current market rate. To the extent that these inputs are observable, the values of interest rate swaps are categorized as Level 2. To the extent that these inputs are unobservable the values are categorized as Level 3.
The Fund’s policy is to recognize transfers between levels at the end of the reporting period.
A summary of the inputs used at January 31, 2011 in valuing the Fund’s assets and liabilities is listed below:
                                 
            Level 2 -   Level 3 -    
            Other Significant   Significant    
    Level 1 -   Observable   Unobservable   Value at
    Quoted Prices   Inputs   Inputs   1/31/11
 
Investments in Securities — Assets
                                
Municipal Bonds & Notes:
                                
Tennessee
     —     $ 22,135,473     $ 472,350     $ 22,607,823  
All Other
     —       437,731,380       —       437,731,380  
Variable Rate Notes
     —       10,663,050       —       10,663,050  
 
Total Investments in Securities — Assets
     —     $ 470,529,903     $ 472,350     $ 471,002,253  
 
 
                                
Other Financial Instruments* — Liabilities
                                
Interest Rate Contracts
     —     $ (660 )     —     $ (660 )
 
 
                                
Total Investments
     —     $ 470,529,243     $ 472,350     $ 471,001,593  
 
*   Other Financial Instruments are derivatives not reflected in the Schedule of Investments, such as swap agreements which are valued at the unrealized appreciation (depreciation) of the instrument.
There were no significant transfers between Levels 1 and 2 during the nine months ended January 31, 2011.
A roll forward of fair value measurements using significant unobservable inputs (Level 3) for the nine months ended January 31, 2011, was as follows:
                                         
            Net Change            
    Beginning   in Unrealized            
    Balance   Appreciation/   Transfers into   Transfers out   Ending Balance
    4/30/10   Depreciation   Level 3   of Level 3   1/31/11
 
Investments in Securities — Assets
                                        
Municipal Bonds & Notes:
                                        
Tennessee
   $ 470,000     $ 2,350       —       —     $ 472,350  
 
Total Investments
   $ 470,000     $ 2,350       —       —     $ 472,350  
 
The net change in unrealized appreciation/depreciation of Level 3 investments which the Fund held at January 31, 2011 was $2,350.

 

 

Item 2. Controls and Procedures
(a) The registrant’s President & Chief Executive Officer and Treasurer, Principal Financial & Accounting Officer have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Act (17 CFR 270.30a -3(c))), are effective based on their evaluation of these controls and procedures as of a date within 90 days of the filing date of this document.
(b) There were no significant changes in the registrant’s internal controls over financial reporting (as defined in Rule 30a-3(d) under the Act (17 CFR 270.30a -3(d))) that occurred during the registrant’s last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.
Item 3. Exhibits
     (a) Exhibit 99.302 Cert. — Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

 

 

SIGNATURES
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.
Registrant: PIMCO Municipal Income Fund
By /s/ Brian S. Shlissel
President & Chief Executive Officer
Date: March 24, 2011
         
By
  /s/ Lawrence G. Altadonna    
 
 
 
    
Treasurer, Principal Financial & Accounting Officer
Date: March 24, 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/ Brian S. Shlissel
President & Chief Executive Officer
Date: March 24, 2011
         
By
  /s/ Lawrence G. Altadonna    
 
 
 
    
Treasurer, Principal Financial & Accounting Officer
Date: March 24, 2011