NEW YORK, Dec. 1, 2008 (GLOBE NEWSWIRE) -- PIMCO Corporate Income Fund (NYSE:PCN) and PIMCO Corporate Opportunity Fund (NYSE:PTY) (each a "Fund" and collectively the "Funds") announced today that the Funds will pay the previously declared (November 3, 2008) common share dividends as scheduled on December 1, 2008. The Funds also announced that the Funds are required to postpone the declaration of the next dividends on the Funds' common shares, which would have been paid on December 31, 2008.
Accordingly, the declared dividends ($0.10625 and $0.11500 per common share for PCN and PTY, respectively) payable on December 1, 2008 to shareholders of record on November 13, 2008, with an ex-dividend date of November 10, 2008, will be paid as scheduled on December 1, 2008.
Continued severe market dislocations have caused the values of the Funds' portfolio securities to decline. Although the Funds' asset coverage ratios are currently above the 200% Level (which is described below), permitting the payment of the previously declared November common share dividends, the Funds' asset coverage ratios would fall below the 200% Level if the December dividends were also declared at this point. A Fund is not permitted to pay or declare common share dividends unless the Fund's auction rate preferred shares ("ARPS") have a minimum asset coverage of 200% ("200% Level") after payment or declaration of the common share dividend, in accordance with the Investment Company Act of 1940, as amended, and the Fund's By-laws.
The Funds intend to resume declaring dividends as soon as possible. As announced in a press release on November 26, 2008, the Funds are redeeming a portion of their outstanding ARPS. These redemptions are expected to be completed by December 19, 2008 and are intended to increase and maintain asset coverage of the Funds' ARPS above the 200% Level which would permit the Funds to declare and pay future common share dividends. Depending on market conditions, these coverage ratios may increase or decrease further and an announcement regarding actual dividend declaration dates will be made at a future date.
PCN's investment objective is to seek high current income with a secondary objective of capital preservation and appreciation. PTY's investment objective is to seek maximum total return through a combination of current income and capital appreciation. There can be no assurance that the Funds will achieve their stated objectives.
Allianz Global Investors Fund Management LLC, an indirect, wholly-owned subsidiary of Allianz Global Investors of America L.P., serves as the Funds' investment manager and is a member of Munich-based Allianz Group (NYSE:AZ). Pacific Investment Management Company LLC, an Allianz Global Investors Fund Management affiliate, serves as the Funds' sub-adviser.
The Funds' daily New York Stock Exchange closing prices and net asset values per share are available by calling the Funds' shareholder servicing agent at (800) 331-1710. This information, as well as updated portfolio statistics and performance, is available at http://www.allianzinvestors.com.
Statements made in this release that look forward in time involve risks and uncertainties and are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such risks and uncertainties include, without limitation, the adverse effect from further declines in the securities markets and in the Funds' performance, a general downturn in the economy, inability to obtain leverage to replace ARPS that have been redeemed, competition from other companies, changes in government policy or regulation, inability to attract or retain key employees, inability to implement their operating strategy and/or acquisition strategy, and unforeseen costs and other effects related to legal proceedings or investigations of governmental and self-regulatory organizations. The Funds' ability to pay dividends to common shareholders is subject to the restrictions in their registration statements, By-laws and other governing documents as well as the Investment Company Act of 1940.