--------------------------------------------------------------------------------
Semi-Annual Report
11.30.02
PIMCO MUNICIPAL INCOME FUND II
PIMCO CALIFORNIA MUNICIPAL INCOME FUND II
PIMCO NEW YORK MUNICIPAL INCOME FUND II
================================================================================
CONTENTS
[GRAPHIC OMITTED] Chairman's Letter ................................. 1
Management Review and Outlook ................... 2-3
Performance and Statistics ...................... 4-9
[GRAPHIC OMITTED] Schedules of Investments ...................... 10-27
Statements of Assets and Liabilities ............. 28
Statements of Operations ......................... 29
[GRAPHIC OMITTED] Statements of Changes in Net Assets .............. 30
Notes to Financial Statements ................. 31-34
Financial Highlights ............................. 35
[PIMCO ADVISORS LOGO]
PIMCO MUNICIPAL INCOME FUNDS II LETTER TO SHAREHOLDERS
January 10, 2003
Dear Shareholder:
PIMCO Advisors Fund Management LLC is pleased to provide you with the initial
financial report for PIMCO Municipal Income Fund II, PIMCO California Municipal
Income Fund II and PIMCO New York Municipal Income Fund II (the "PIMCO Municipal
Income Funds II" or the "Funds") for the period June 28, 2002 (commencement of
operations) through November 30, 2002.
The Funds' abbreviated first reporting period was marked by ongoing volatility
in the global financial markets. However, this climate continued to support the
municipal bond markets as investors fled stocks and riskier securities and
flocked to the relative stability offered by U.S. Treasuries and other
high-quality fixed income securities. Accordingly, we are pleased to report that
the PIMCO Municipal Income Funds II delivered strong absolute performance for
the period. The Funds' portfolio manager achieved these results by adhering to
PIMCO's time-tested total return philosophy.
The Funds' use of leverage, which entails additional risks, including enhanced
interest rate risk, contributed positively to the Funds' performance during the
reporting period. During adverse market conditions, leverage can also exacerbate
negative performance. Consequently, it is important to maintain a
well-diversified investment portfolio. Consult your financial advisor to develop
an asset allocation strategy that is appropriate for you.
Please refer to the Fund information and commentaries on the following pages. If
you have any questions, contact your financial advisor or call our shareholder
services area at 1-800-331-1710. You can also access a wide range of information
and resources through our web site-- www.pimcoadvisors.com.
Thank you for the trust you have placed with PIMCO Advisors. We remain dedicated
to serving your investment needs.
Sincerely,
/s/ Stephen Treadway /s/ Brian S. Shlissel
Stephen Treadway Brian S. Shlissel
CHAIRMAN PRESIDENT, CHIEF EXECUTIVE OFFICER
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. There is no guarantee that
these or any other investment techniques will be effective under all market
conditions. The use of leverage may cause a Fund to liquidate portfolio
positions when it may not be advantageous to do so to satisfy its obligations or
to meet segregation requirements.
11.30.02 | PIMCO Municipal Income Funds II Semi-Annual Report 1
PIMCO MUNICIPAL INCOME FUNDS II MANAGEMENT REVIEW & OUTLOOK
[PHOTO OF MARK McCRAY]
MARK MCCRAY
Fund Manager
The PIMCO Municipal Income Funds II generated positive returns during the period
June 28, 2002 (commencement of operations) through November 30, 2002; (see
individual fund pages for complete performance information). Below, Mark McCray,
the Funds' portfolio manager, provides insight into the municipal bond market
and offers his outlook and strategy going forward.
Q. HOW WOULD YOU CHARACTERIZE THE PAST SIX MONTHS IN THE MUNICIPAL BOND
MARKET?
A. Flight to quality was the driving force in the municipal bond market during
the past six months, as investor concerns mounted over a weakening U.S. economy,
declining earnings and heightened geopolitical risk. Treasury and municipal
yields fell sharply for most of the period. However, a stock market rally
towards the end of the period caused bonds to give back some of their gains.
Municipals performed well during the period, delivering solid tax-adjusted
returns relative to the overall bond market. Looking at the state markets,
California underperformed the national municipal bond market amid heavy new
issuance. The New York municipal market outperformed, with short- and
intermediate-term bond yields falling further than long-term alternatives.
Q. WHAT WERE THE TOP PERFORMING MUNICIPAL SECTORS?
A. Overall, revenue bonds outperformed general obligation issues, which were
hindered by increased supply and concerns over diminishing tax revenues. Within
the revenue sector, high quality transportation and utility bonds performed
well. Insured bonds were strong performers across the municipal markets, as
investors looked to avoid risk. In California, a high quality focus proved
beneficial, as investors preferred the stability offered by higher-rated bonds.
In New York, both revenue and general obligation issues performed well. Insured
holdings of both New York and California municipal bonds were positive amid
investors' flight to quality.
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. This update contains the
current opinions of the Fund manager and does not represent a recommendation of
any particular security, strategy or investment product. Such opinion is subject
to change without notice. This update is distributed for educational purposes
and should not be considered investment advice. The credit quality of the
investment in the portfolio does not apply to the stability or safety of the
fund. For additional information on the PIMCO Closed-end Funds, contact your
financial advisor or call 1-800-331-1710.
2 PIMCO Municipal Income Funds II Semi-Annual Report | 11.30.02
PIMCO MUNICIPAL INCOME FUNDS II MANAGEMENT REVIEW & OUTLOOK
Q. WHAT IS YOUR OUTLOOK FOR THE ECONOMY AND THE MUNICIPAL BOND MARKET?
A. Looking ahead, we expect the modest U.S. recovery to continue, driven
mainly by the consumer and housing sectors. While the business sector has begun
the healing process, it is likely to remain weak in the months ahead. Within our
investment universe, sluggish growth could challenge municipal credits as tax
revenues lag the economy. However, now that the larger municipal deals of 2002
have passed, there should be much lighter issuance in the months ahead. This,
combined with heavy coupon reinvestment, should bode well for the asset class
over the near term. Looking at the state markets, California issuance is
expected to be more moderate going forward, lending support to that market. New
York issuance is expected to increase due to the passing of the state's budget
and the financing needs of state and local governments.
Q. IN THIS ENVIRONMENT, HOW DO YOU INTEND TO POSITION THE FUNDS?
A. In general, we expect to maintain high overall quality given the weak
fiscal situation facing most municipal issuers. Focusing on how individual state
and local governments manage their budgetary imbalances will be critical in
determining which sectors of the marketplace remain attractive. In the meantime,
we intend to emphasize high-quality revenue bonds, which we believe continue to
offer attractive risk-adjusted yields.
Mr. McCray is responsible for municipal bond portfolios at PIMCO. Previously
Co-Head of Municipal Bond Trading at Goldman Sachs & Co., he has over 12 years
of investment experience.
11.30.02 | PIMCO Municipal Income Funds II Semi-Annual Report 3
PIMCO MUNICIPAL INCOME FUND II PERFORMANCE SUMMARY AND STATISTICS
SYMBOL: PRIMARY INVESTMENTS: FUND INCEPTION DATE:
PML Municipal fixed-income June 28, 2002
securities, the interest
OBJECTIVE: from which is exempt from NET ASSETS:
PIMCO Municipal Income federal income tax. $1,325.5 million
Fund II seeks to provide (at 11/30/02)
income exempt from federal
income tax. PORTFOLIO MANAGER:
Mark McCray
TOTAL RETURN(1) Market Price NAV
--------------------------------------------------------------------------------
Commencement of Operations
(6/28/02 to 11/30/02) -2.17% 1.57%
--------------------------------------------------------------------------------
COMMON SHARE PRICE PERFORMANCE (WEEKLY)
For the period ended 11/30/02
o Municipal Income Fund II at NAV
o Municipal Income Fund II at Market Price
[The table below represents a line chart in the printed report.]
[data to come]
MONTHLY PER SHARE COMMON DIVIDENDS
PERIOD ENDED 11/30/02
[The table below represents a bar chart in the printed report.]
[data to come]
4 PIMCO Municipal Income Funds II Semi-Annual Report | 11.30.02
PIMCO MUNICIPAL INCOME FUND II PERFORMANCE SUMMARY AND STATISTICS
CREDIT QUALITY TOP FIVE STATE HOLDINGS:
-------------------------------------- --------------------------------------
AAA 69% Texas 18.2%
-------------------------------------- --------------------------------------
AA 13% Illinois 14.9%
-------------------------------------- --------------------------------------
A 16% Massachusetts 10.9%
-------------------------------------- --------------------------------------
BBB 2% Alabama 7.8%
-------------------------------------- --------------------------------------
WEIGHTED AVERAGE QUALITY AA+ Florida 5.4%
-------------------------------------- --------------------------------------
PORTFOLIO STATISTICS
-----------------------------------------------------------
Market Price $14.34
-----------------------------------------------------------
Net Asset Value $14.22
-----------------------------------------------------------
Market Yield 7.06%
-----------------------------------------------------------
Taxable Equivalent Yield (FEDERAL INCOME TAX RATE) *11.50%
-----------------------------------------------------------
Net Assets (millions) $1,325.5
-----------------------------------------------------------
Average Effective Maturity (years) 20.63
-----------------------------------------------------------
Average Duration (years) 12.28
-----------------------------------------------------------
PORTFOLIO COMPOSITION-TOP 5 SECTORS
-----------------------------------------------------------
[The table below represents a bar chart in the printed report.]
Education Rev. 7%
Other Rev. 20%
Transportation Rev. 12%
Healthcare Rev. 13%
Water & Sewer Rev. 18%
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. 1. Total return is
determined by subtracting the initial investment from the redeemable value and
dividing the remainder by the initial investment and expressing the result as a
percentage. The calculation assumes that all income dividends and capital gains
distributions by the Fund have been reinvested at prices obtained under the
Fund's dividend reinvestment plan. Total investment return does not reflect
broker commissions or sales charges. Total return for a period of less than one
year is not annualized. *Taxable equivalent rate represents the yield on a
taxable investment necessary to equal the after-tax yield of the Fund. The rate
shown highlights the value of owning shares that are exempt from taxes, and is
based on a federal tax rate of 38.6%. An investment in the Fund involves risk,
including the loss of principal. Investment return, price, yields and net asset
value will fluctuate with changes in market conditions. This data is provided
for information only and is not intended for trading purposes. A portion of the
income generated by the Fund may be subject to federal, state and local taxes,
and may at times be subject to the alternative minimum tax (AMT). Closed-end
funds, unlike open-end funds, are not continuously offered. There is a one-time
public offering and once issued, shares of closed-end funds are sold in the open
market through a stock exchange. Net asset value (NAV) per common share is total
assets applicable to common shareholders less total liabilities divided by the
number of common shares outstanding. Duration is a measure of the Fund's price
sensitivity expressed in years. The credit quality of the investment in the
portfolio does not apply to the stability or safety of the Fund. Certain
securities are not rated by a nationally recognized rating agency. In these
circumstances, the Fund's Sub-Adviser assigns a rating to these securities based
on their analysis of the issuers credit quality. Holdings are subject to change
daily.
11.30.02 | PIMCO Municipal Income Funds II Semi-Annual Report 5
PIMCO CALIFORNIA MUNICIPAL INCOME FUND II PERFORMANCE SUMMARY AND STATISTICS
SYMBOL: PRIMARY INVESTMENTS: INCEPTION DATE:
PCK Municipal fixed-income June 28, 2002
securities, the interest
OBJECTIVE: from which is exempt NET ASSETS:
PIMCO California from federal and $680.6 million (at 11/30/02)
Municipal Income Fund II California State
seeks to provide current income tax. PORTFOLIO MANAGER:
income exempt from Mark McCray
federal and California
State income tax.
TOTAL RETURN(1) Market Price NAV
--------------------------------------------------------------------------------
Commencement of Operations
(6/28/02 to 11/30/02) -2.16% 0.22%
--------------------------------------------------------------------------------
COMMON SHARE PRICE PERFORMANCE (WEEKLY)
For the period ended 11/30/02
o California Municipal Income Fund II at NAV
o California Municipal Income Fund II at Market Price
[The table below represents a line chart in the printed report.]
[data to come]
MONTHLY PER SHARE COMMON DIVIDENDS
PERIOD ENDED 11/30/02
[The table below represents a bar chart in the printed report.]
[data to come]
6 PIMCO Municipal Income Funds II Semi-Annual Report | 11.30.02
PIMCO CALIFORNIA MUNICIPAL INCOME FUND II PERFORMANCE SUMMARY AND STATISTICS
CREDIT QUALITY
-------------------------------------------------
AAA 82%
-------------------------------------------------
AA 2%
-------------------------------------------------
A 10%
-------------------------------------------------
BB 6%
-------------------------------------------------
WEIGHTED AVERAGE QUALITY AAA
-------------------------------------------------
PORTFOLIO COMPOSITION-TOP 5 SECTORS
-------------------------------------------------
[The table below represents a bar chart in the printed report.]
Other Rev. 10%
Water & Sewer Rev. 18%
State General Obligations 12%
Education Rev. 14%
Local General Obligations 17%
PORTFOLIO STATISTICS
-------------------------------------------------
Market Price $ 14.35
-------------------------------------------------
Net Asset Value $ 14.04
-------------------------------------------------
Market Yield 6.79%
-------------------------------------------------
Taxable Equivalent Yield* 12.19%
-------------------------------------------------
Net Assets (millions) $ 680.6
-------------------------------------------------
Average Effective Maturity (years) 22.87
-------------------------------------------------
Average Duration (years) 11.87
-------------------------------------------------
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. 1. Total return is
determined by subtracting the initial investment from the redeemable value and
dividing the remainder by the initial investment and expressing the result as a
percentage. The calculation assumes that all income dividends and capital gains
distributions by the Fund have been reinvested at prices obtained under the
Fund's dividend reinvestment plan. Total investment return does not reflect
broker commissions or sales charges. Total return for a period of less than one
year is not annualized. *Taxable equivalent rate represents the yield on a
taxable investment necessary to equal the after-tax yield of the Fund. The rate
shown highlights the value of owning shares that are exempt from taxes, and is
based on a combined federal and state tax rate of 44.31%. An investment in the
Fund involves risk, including the loss of principal. Investment return, price,
yields and net asset value will fluctuate with changes in market conditions.
This data is provided for information only and is not intended for trading
purposes. A portion of the income generated by the Fund may be subject to
federal, state and local taxes, and may at times be subject to the alternative
minimum tax (AMT). Closed-end funds, unlike open-end funds, are not continuously
offered. There is a one-time public offering and once issued, shares of
closed-end funds are sold in the open market through a stock exchange. Net asset
value (NAV) per common share is total assets applicable to common shareholders
less total liabilities divided by the number of common shares outstanding.
Duration is a measure of the Fund's price sensitivity expressed in years. The
credit quality of the investment in the portfolio does not apply to the
stability or safety of the Fund. Certain securities are not rated by a
nationally recognized rating agency. In these circumstances, the Fund's
Sub-Adviser assigns a rating to these securities based on their analysis of the
issuers credit quality. Holdings are subject to change daily.
11.30.02 | PIMCO Municipal Income Funds II Semi-Annual Report 7
PIMCO NEW YORK MUNICIPAL INCOME FUND II PERFORMANCE SUMMARY AND STATISTICS
SYMBOL:
PNI
OBJECTIVE: PRIMARY INVESTMENTS: INCEPTION DATE:
PIMCO New York Municipal Municipal fixed-income June 28, 2002
Income Fund II seeks to securities, the interest
provide current income from which is exempt NET ASSETS:
exempt from federal, New from federal, New York $236.7 million (at 11/30/02)
York State and New York State and New York City
City income tax. income tax. PORTFOLIO MANAGER:
Mark McCray
TOTAL RETURN(1) Market Price NAV
--------------------------------------------------------------------------------
Commencement of Operations
(6/28/02 to 11/30/02) -3.06% 1.35%
--------------------------------------------------------------------------------
COMMON SHARE PRICE PERFORMANCE (WEEKLY)
For the period ended 11/30/02
o New York Municipal Income Fund II at NAV
o New York Municipal Income Fund II at Market Price
[The table below represents a line chart in the printed report.]
[data to come]
MONTHLY PER SHARE COMMON DIVIDENDS
PERIOD ENDED 11/30/02
[The table below represents a bar chart in the printed report.]
[data to come]
8 PIMCO Municipal Income Funds II Semi-Annual Report | 11.30.02
PIMCO NEW YORK MUNICIPAL INCOME FUND II PERFORMANCE SUMMARY AND STATISTICS
CREDIT QUALITY
-------------------------------------------------
AAA 35%
-------------------------------------------------
AA 46%
-------------------------------------------------
A 19%
-------------------------------------------------
WEIGHTED AVERAGE QUALITY AA
-------------------------------------------------
PORTFOLIO COMPOSITION-TOP 5 SECTORS
-------------------------------------------------
[The table below represents a bar chart in the printed report.]
Transportation Rev. 9%
Other Rev. 23%
Water & Sewer Rev. 11%
Miscellaneous 15%
Higher Education Rev. 15%
PORTFOLIO STATISTICS
-------------------------------------------------
Market Price $ 14.22
-------------------------------------------------
Net Asset Value $ 14.20
-------------------------------------------------
Market Yield 6.86%
-------------------------------------------------
Taxable Equivalent Yield* 12.00%
-------------------------------------------------
Net Assets (millions) $ 236.7
-------------------------------------------------
Average Effective Maturity (years) 20.34
-------------------------------------------------
Average Duration (years) 12.17
-------------------------------------------------
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. 1. Total return is
determined by subtracting the initial investment from the redeemable value and
dividing the remainder by the initial investment and expressing the result as a
percentage. The calculation assumes that all income dividends and capital gains
distributions by the Fund have been reinvested at prices obtained under the
Fund's dividend reinvestment plan. Total investment return does not reflect
broker commissions or sales charges. Total return for a period of less than one
year is not annualized. *Taxable equivalent rate represents the yield on a
taxable investment necessary to equal the after-tax yield of the Fund. The rate
shown highlights the value of owning shares that are exempt from taxes, and is
based on a combined federal and state tax rate of 42.81%. An investment in the
Fund involves risk, including the loss of principal. Investment return, price,
yields and net asset value will fluctuate with changes in market conditions.
This data is provided for information only and is not intended for trading
purposes. A portion of the income generated by the Fund may be subject to
federal, state and local taxes, and may at times be subject to the alternative
minimum tax (AMT). Closed-end funds, unlike open-end funds, are not continuously
offered. There is a one-time public offering and once issued, shares of
closed-end funds are sold in the open market through a stock exchange. Net asset
value (NAV) per common share is total assets applicable to common shareholders
less total liabilities divided by the number of common shares outstanding.
Duration is a measure of the Fund's price sensitivity expressed in years. The
credit quality of the investment in the portfolio does not apply to the
stability or safety of the Fund. Certain securities are not rated by a
nationally recognized rating agency. In these circumstances, the Fund's
Sub-Adviser assigns a rating to these securities based on their analysis of the
issuers credit quality. Holdings are subject to change daily.
11.30.02 | PIMCO Municipal Income Funds II Semi-Annual Report 9
PIMCO MUNICIPAL INCOME FUND II SCHEDULE OF INVESTMENTS
November 30, 2002 (unaudited)
Principal
Amount Credit Ratings
(000) (Moody's/S&P) Value*
====================================================================================================================================
MUNICIPAL BONDS & NOTES -- 89.2%
------------------------------------------------------------------------------------------------------------------------------------
ALABAMA--6.7%
$ 61,895 Birmingham Waterworks & Sewer Board. Rev., Ser. B, 5.00%, 1/1/27-1/1/43 (MBIA) Aaa/AAA $ 60,012,842
1,750 Huntsville Health Care Auth., Ser. B, 5.75%, 6/1/32 A2/NR 1,740,148
29,080 Jefferson Cnty. Sewer Rev., Ser. B, 4.75%-5.00%, 2/1/38-2/1/41 (FGIC) Aaa/AAA 27,531,807
------------
89,284,797
============
ALASKA--1.3%
State Housing. Fin. Corp.,
13,885 5.00%, 12/1/39, Ser. A Aaa/AAA 13,244,902
3,550 5.25%, 6/1/32, Ser. C (MBIA) Aaa/AAA 3,479,035
------------
16,723,937
============
ARIZONA--0.1%
1,300 State Health Fac. Auth. Hosp. Rev., 5.75%, 12/1/32 NR/BBB 1,212,406
============
CALIFORNIA--0.1%
1,000 Rancho Cucamonga Cmnty. Facs. Dist., Ser. A, 6.30%, 9/1/23 NR/NR 1,013,680
============
COLORADO--4.5%
30,000 Dawson Ridge Dist. No. 1, GO, Ser. A, zero coupon, 10/1/22 Aaa/NR 10,451,700
5,000 Denver Co. City & Cnty. Cert. of Participation, Ser. B, 5.50%, 12/1/25 (AMBAC) Aaa/AAA 5,205,000
25,000 Health Fac. Auth. Rev., Catholic Health Initiatives-A, 5.50%, 3/1/32 Aa2/AA 24,640,000
18,305 Health Fac. Auth. Rev., Exempla Inc., Ser. A, 5.625%, 1/1/33 A1/A 17,722,169
6,500 Health Fac. Auth. Rev., Liberty Height, Retirement Fac., zero coupon, 7/15/22 Aaa/AAA 2,290,145
------------
60,309,014
============
DISTRICT OF COLUMBIA--1.3%
17,500 Washington D.C. Convention Ctr. Auth. Tax Rev., 4.75%, 10/1/28 (AMBAC) Aaa/AAA 16,505,125
============
FLORIDA--4.5%
8,000 Highlands Cnty. Health Fac. Auth. Rev., Ser. A, 6.00%, 11/15/31 A3/A- 8,199,680
635 Hillsborough Cnty. Health Fac. Indl. Dev. Rev., 5.625%, 8/15/23 Baa2/BBB 580,384
1,925 Hillsborough Cnty. Pollution Control Rev., Tampa Electric Co. Proj., 5.50%, 10/1/23 A2/BBB 1,878,242
7,135 Jacksonville Health Facs. Auth. Rev., Ser. A, 5.25%, 11/15/32 Aa2/AA 6,904,825
3,525 Jacksonville Impt. Rev., Ser. A, 5.00%, 10/1/30 (AMBAC) Aaa/NR 3,493,345
10 PIMCO Municipal Income Funds II Semi-Annual Report | 11.30.02 |
PIMCO MUNICIPAL INCOME FUND II SCHEDULE OF INVESTMENTS
November 30, 2002 (unaudited)
Principal
Amount Credit Ratings
(000) (Moody's/S&P) Value*
====================================================================================================================================
FLORIDA--(CONTINUED)
$ 5,350 Lakeland Elec. & Water Rev., Ser. A, 5.00%, 10/1/28 (MBIA) Aaa/AAA $ 5,318,916
10,000 Lakeland Hosp. Syst. Rev., Regional Health Sys., 5.50%, 11/15/32 A1/NR 9,700,000
3,000 Leesburg Hosp. Rev., Leesburg Regional Medical Center, 5.50%, 7/1/32 A2/A 2,881,470
1,410 Melbourne Water & Sewer Rev., Ser. A, 5.00%, 10/1/32 (FGIC) Aaa/AAA 1,394,800
4,610 Municipal Council Rev., North Miami Beach Water Proj., Ser. B, 5.00%, 8/1/32 (MBIA) Aaa/AAA 4,560,443
7,550 Orange Cnty. Health Fac., Adventist Health Sys., 5.625%-6.25%, 11/15/24-11/15/32 A3/A- 7,716,081
6,615 State Board of Education, Ser. B, GO, 5.00%, 6/1/27 (FGIC) Aaa/AAA 6,587,217
1,500 Winter Springs Water & Sewer Rev., zero coupon, 10/1/29 (FGIC) Aaa/AAA 350,850
------------
59,566,253
============
GEORGIA--1.0%
9,000 Atlanta Water & Wastewater, Ser. A, 5.00%, 11/1/39 (MBIA) Aaa/AAA 8,777,610
1,500 Grantor Trust Gov't Cert. of Participation, Ser. A, 4.75%, 6/1/28 (MBIA) Aaa/AAA 1,431,735
9,600 Richmond Cnty. Dev Auth. Rev., zero coupon, 12/1/21 Aaa/NR 3,509,088
------------
13,718,433
============
HAWAII--1.4%
19,170 Honolulu City & Cnty. Wastewater Syst. Rev., First Board Resolution, 4.75%, 7/1/28 (FGIC) Aaa/NR 18,164,150
============
ILLINOIS--13.9%
11,760 Central Lake Cnty. Water Agy. Rev., Ser. A, 5.125%, 5/1/28-5/1/32 (AMBAC) Aaa/AAA 11,754,708
Chicago Board of Education School Reform GO, Ser. A,
2,830 5.25%, 12/1/18 (MBIA) Aaa/AAA 2,973,707
9,500 zero coupon, 12/1/28-12/1/31 (FGIC) Aaa/AAA 2,067,695
94,485 Chicago City Colleges GO, zero coupon, 1/1/37-1/1/39 (FGIC) Aaa/AAA 13,173,627
5,050 Chicago GO, Ser. A, 5.125%, 1/1/29 (FGIC) Aaa/AAA 5,046,162
7,000 Chicago Midway Arpt. Rev., Ser. B, 5.00%, 1/1/31 (MBIA) Aaa/AAA 6,794,200
5,000 Cicero Corp. GO, 5.25%, 12/1/31 (MBIA) Aaa/AAA 5,092,000
111,745 Metropolitan Pier & Exposition Auth., zero coupon-5.00%, 12/15/28-12/15/33 (MBIA) Aaa/AAA 23,086,938
144,650 State Dev. Fin. Auth. Retirement Housing Rev., zero coupon, 7/15/23-7/15/25 NR/AAA 42,497,813
4,350 State GO, 4.75%, 10/1/27 (MBIA) Aaa/AAA 4,095,830
| 11.30.02 | PIMCO Municipal Income Funds II Semi-Annual Report 11
PIMCO MUNICIPAL INCOME FUND II SCHEDULE OF INVESTMENTS
November 30, 2002 (unaudited)
Principal
Amount Credit Ratings
(000) (Moody's/S&P) Value*
====================================================================================================================================
ILLINOIS--(CONTINUED)
State Sports Facs. Auth,
$ 5,000 5.00%, 6/15/32 (AMBAC) Aaa/AAA $ 4,901,600
68,470 zero coupon, 6/15/30 Aaa/AAA 45,328,509
17,720 Univ. of Chicago Edl. Facs. Auth. Rev., Ser. A, 5.25%, 7/1/41 Aa1/AA 17,838,547
------------
184,651,336
============
INDIANA--0.1%
500 State Bank Rev., Ser. D, 5.25%, 4/1/30 (AMBAC) Aaa/AAA 506,585
============
IOWA--0.6%
8,850 Tobacco Settlement Auth., Ser. B, 5.60%, 6/1/35 A1/A 7,632,859
============
LOUISIANA--4.8%
20,400 Ochsner Clinic Foundation Pub. Facs. Auth. Rev., Ser. B, 5.50%, 5/15/32 A3/NR 19,238,628
9,250 State Gas & Fuels Tax Rev., Ser. A, 5.00%, 6/1/32 (AMBAC) Aaa/AAA 9,095,802
39,395 Tobacco Settlement Financing Corp., Ser. 2001B, 5.875%, 5/15/39 A1/A 35,323,527
------------
63,657,957
============
MARYLAND--0.6%
8,650 State Health & Higher Educational. Fac. Auth. Rev.,
John Hopkins Univ., Ser. B, 5.00%, 7/1/41 Aa2/AA 8,490,062
============
MASSACHUSETTS--7.7%
1,300 Massachusetts Bay Trans. Auth., Ser. A, 4.75%, 3/1/21 (MBIA) Aaa/AAA 1,262,820
32,000 Massachusetts Bay Trans. Auth., Sales Tax Rev., Ser. A, 5.00%, 7/1/32 Aa3/AAA 31,368,960
20,000 State GO, Ser. C, 5.25%, 11/1/30 Aa2/AA- 20,261,200
State Health & Educational Fac. Auth. Rev.,
4,850 Boston College, Ser. L, 4.75%, 6/1/31 Aa3/AA- 4,568,652
20,000 Harvard Univ., Ser. FF, 5.125%, 7/15/37 Aaa/AAA 20,006,400
4,295 State Turnpike Auth., Ser. A, 4.75%, 1/1/34 (AMBAC) Aaa/AAA 4,048,982
State Water Reserve Auth.,
19,300 4.75%, 8/1/37, Ser. A Aaa/AAA 18,086,609
2,300 4.75%, 12/1/21, Ser. B Aaa/AAA 2,252,091
------------
101,855,714
============
MICHIGAN--3.4%
10,250 Detroit City School Dist., Ser. A, 5.00%-5.125%, 5/1/31-5/1/32 Aaa/AAA 10,098,535
2,500 Detroit Water Supply Syst., Ser. A, 5.00%, 7/1/30 (FGIC) Aaa/AAA 2,463,100
5,000 State Hosp. Fin. Auth. Rev., Ascension Health, Ser. B, 5.25%, 11/15/26 Aa2/AA 4,860,450
12 PIMCO Municipal Income Funds II Semi-Annual Report | 11.30.02 |
PIMCO MUNICIPAL INCOME FUND II SCHEDULE OF INVESTMENTS
November 30, 2002 (unaudited)
Principal
Amount Credit Ratings
(000) (Moody's/S&P) Value*
====================================================================================================================================
MICHIGAN--(CONTINUED)
$ 12,325 State Hosp. Fin. Auth. Rev., Oakwood Obligation Group, Ser. A, 5.75%-6.00%, 4/1/22 A2/A $ 12,227,860
7,775 West Ottawa Pub. School Dist., Ser. A, 5.00%, 5/1/32 Aaa/AAA 7,610,481
8,000 Whitehall Dist. Schools, 5.00%, 5/1/27 Aaa/AAA 7,888,640
------------
45,149,066
============
MISSISSIPPI--0.1%
1,000 State Dev. Bank Oblig., Projects & Equipment Acquisitions, 5.00%, 7/1/24 (AMBAC) Aaa/AAA 1,006,540
============
MISSOURI--0.1%
1,500 St. Louis Parking Facs. Rev., Downtown Parking Facility, 6.00%, 2/1/28 NR/NR 1,445,250
============
NEBRASKA--0.8%
9,150 Omaha Pub. Pwr. Dist., Nebraska Electric Rev., Ser. B, 6.20%, 2/1/17 (MBIA) Aaa/AAA 10,747,956
============
NEVADA--1.8%
3,400 Clark Cnty. GO, 5.00%, 6/1/31 (FGIC) Aaa/AAA 3,339,174
17,030 Reno Lien Transn., 5.125%-5.25%, 6/1/27-6/1/41 (AMBAC) Aaa/AAA 17,112,061
3,290 Truckee Meadows Water Auth Rev., Ser. A, 5.125%, 7/1/30 (FSA) Aaa/AAA 3,268,220
------------
23,719,455
============
NEW JERSEY--1.5%
60 Camden Cnty. Impt. Auth. Rev., Cooper Health, 5.875%-6.00%, 2/15/15-2/15/27 Ba3/NR 46,217
750 Economic Dev. Auth., Arbor Glen, Ser. A, 6.00%, 5/15/28 NR/NR 632,647
15,405 Economic Dev. Auth., Kapkowski Landfill Proj., 5.75%, 10/1/21-4/1/31 Baa3/NR 15,192,899
3,500 Tobacco Settlement Rev., 6.125%, 6/1/42 A1/A 3,328,430
------------
19,200,193
============
NEW YORK--0.8%
10,600 Metropolitan Trans. Auth., Ser. A, 5.00%, 11/15/30 (FSA) Aaa/AAA 10,489,442
============
NORTH CAROLINA--0.8%
11,105 Cap. Facs. Fin. Agy. Rev., Duke Univ., Ser. A, 5.125%, 7/1/42 Aa1/AA+ 11,116,882
============
OHIO--0.4%
6,000 State Water Dev. Auth. Rev., 4.75%, 12/1/27 Aa2/AAA 5,705,160
============
| 11.30.02 | PIMCO Municipal Income Funds II Semi-Annual Report 13
PIMCO MUNICIPAL INCOME FUND II SCHEDULE OF INVESTMENTS
November 30, 2002 (unaudited)
Principal
Amount Credit Ratings
(000) (Moody's/S&P) Value*
====================================================================================================================================
PENNSYLVANIA--2.6%
$ 4,500 Allegheny Cnty. Hosp. Dev. Auth. Rev., Ser. B, 9.25%, 11/15/30 B1/B+ $ 4,910,175
9,825 East Allegheny School Dist., 5.00%, 4/1/32 (FGIC) Aaa/AAA 9,675,660
8,750 Montgomery Cnty. Higher Education & Health Auth.
Hosp. Rev., Abington Memorial, Ser. A, 5.125%, 6/1/27-6/1/32 NR/A 8,165,813
5,000 Philadelphia Auth. Dev. Lease Rev., Ser. B, 5.25%, 10/1/30 (FSA) Aaa/AAA 5,076,350
3,050 Philadelphia Auth. Indl. Dev. Rev., Doubletree, 6.50%, 10/1/27 NR/NR 3,010,106
3,000 Philadelphia GO, 5.25%, 9/15/25 (FSA) Aaa/AAA 3,054,180
500 Pittsburgh & Allegheny Cnty. Pub. Auditorium, 5.00%, 2/1/29 (AMBAC) Aaa/AAA 494,210
------------
34,386,494
============
RHODE ISLAND--4.6%
65,000 Tobacco Settlement Financing Corp., Ser. A, 6.25%, 6/1/42 A1/A 61,213,100
============
SOUTH CAROLINA--2.4%
27,745 Greenville Cnty. School District, 5.50%, 12/1/28 A1/AA- 27,865,691
3,250 Tobacco Settlement Rev., Ser. B, 6.375%, 5/15/28 A1/A 3,156,367
1,180 Trans. Infrastructure Rev., Ser. A, 5.00%, 10/1/29 (AMBAC) Aaa/NR 1,178,183
------------
32,200,241
============
TEXAS--16.6%
1,000 Arlington Indpt. School Dist. GO, 5.00%, 2/15/24 Aaa/NR 988,340
4,480 Aubrey Indpt. School Dist. GO, 5.50%, 2/15/33 Aaa/NR 4,089,657
4,500 Austin Water & Wastewater Syst. Rev., Ser. A & B, 5.125%, 5/15/27 (FSA) Aaa/AAA 4,501,395
6,500 Brazos Cnty. Health Facs. Dev. Corp., Franciscan Services Corp., 5.375%, 1/1/32 NR/A- 6,096,415
2,700 Comal Cnty. Health Facs., McKenna Memorial Hosp., 6.25%, 2/1/32 Baa2/BBB 2,618,811
1,790 Cuero Indpt. School Dist. GO, 4.875%, 8/15/32 Aaa/AAA 1,694,593
Dallas Area Rapid Transit.,
24,070 5.00%, 12/1/31 (AMBAC) Aaa/AAA 23,458,622
12,975 5.00%, 12/1/32 (FGIC) Aaa/AAA 12,659,967
500 El Paso Intl. Airport Rev., Marriott Corp., 7.875%, 3/1/22 Ba3/NR 505,505
20,000 Frisco Indpt. School Dist. GO, zero coupon, 8/15/34 Aaa/NR 3,388,600
10,260 Galena Park Indpt. School Dist. GO, zero coupon, 8/15/31 Aaa/AAA 2,056,412
24,975 Harris Cnty. GO, 4.75%-5.125%, 10/1/28-8/15/31 Aa1/AA+ 24,413,712
25,000 Harris Cnty. Senior Lien Toll Road, 5.00%, 8/15/30 (FSA) Aaa/AAA 24,376,000
23,000 Houston Indpt. School Dist. GO, Ser. A, 4.75%, 2/15/26 Aaa/AAA 21,731,320
14 PIMCO Municipal Income Funds II Semi-Annual Report | 11.30.02 |
PIMCO MUNICIPAL INCOME FUND II SCHEDULE OF INVESTMENTS
November 30, 2002 (unaudited)
Principal
Amount Credit Ratings
(000) (Moody's/S&P) Value*
====================================================================================================================================
TEXAS--(CONTINUED)
$ 6,800 Houston Water & Sewer Syst. Rev., Ser. A, 5.00%, 12/1/30 (FSA) Aaa/AAA $ 6,679,300
11,750 Keller Indpt. School Dist. GO, 4.875%, 8/15/31 Aaa/AAA 11,233,587
10,000 Killeen Indpt. School Dist. GO, 4.75%, 2/15/28 Aaa/AAA 9,398,000
3,170 Little Elm Indpt. School Dist. GO, Ser. A, 5.30%, 8/15/29 NR/AAA 3,020,820
6,250 North Dallas Thruway Auth., 4.75%, 1/1/29 (FGIC) Aaa/AAA 5,876,187
3,870 Pearsall Indpt. School Dist. GO, 4.875%, 2/15/32 Aaa/NR 3,665,200
5,000 Quinlin Indpt. School Dist. GO, 5.10%, 2/15/32 Aaa/NR 4,864,900
3,500 South San Antonio Indpt. School Dist. GO, 4.75%, 8/15/32 Aaa/AAA 3,247,860
14,000 State Affordable Housing, American Housing Foundation, Ser. A, 5.40%, 9/1/22 (MBIA) Aaa/AAA 14,416,360
State Turnpike Auth. Highway Imps. Rev.,
10,000 zero coupon, 8/15/19 (AMBAC) Aaa/AAA 4,161,600
8,880 5.00%, 8/15/42 (AMBAC) Aaa/AAA 8,640,418
4,900 State Water Financial Assistance GO, 5.00%-5.25%, 8/1/35-8/1/36 Aa1/AA 4,784,488
8,000 Wichita Falls Water & Sewer Rev., 5.00%, 8/1/27 (AMBAC) Aaa/AAA 7,865,840
--------------
220,433,909
==============
VIRGINIA--1.3%
6,500 Fredericksburg Indl. Dev., Medicorp Health Syst., Ser. B, 5.125%-5.25%, 6/15/27 A3/NR 6,263,295
6,750 State Auth. Water & Sewer Syst. Rev., Tuckahoe Creek Dist., 5.00%, 11/1/35 Aa2/AA 6,674,400
5,000 State Housing Dev. Auth., Ser. Z, 4.85%, 7/1/33 Aa1/AA+ 4,880,650
--------------
17,818,345
==============
WASHINGTON--1.5%
15,000 King Cnty. Sewer Rev., Ser. A, 5.00%, 1/1/35 (FSA) Aaa/AAA 14,602,050
5,000 Tacoma Sewer Rev., Ser. A, 5.00%, 12/1/31 (FGIC) Aaa/AAA 4,880,350
--------------
19,482,400
==============
WISCONSIN--1.9%
9,725 Badger Tobacco Asset Securitization Corp., 6.125%, 6/1/27 A1/A 9,303,908
5,685 State GO, Ser. B, 5.00%, 5/1/16 (FGIC) Aa3/AAA 5,853,844
9,190 State Health & Educational Facs. Auth. Rev., Marquette Univ., Ser. A, 4.85%, 10/1/32 Aaa/AAA 8,691,259
1,000 State Health & Educational Facs. Auth. Rev., Froebert &
Community Health Oblig., 5.375%, 10/1/30 NR/A+ 962,520
--------------
24,811,531
--------------
Total Municipal Bonds & Notes (cost-$1,192,414,737) 1,182,218,272
==============
| 11.30.02 | PIMCO Municipal Income Funds II Semi-Annual Report 15
PIMCO MUNICIPAL INCOME FUND II SCHEDULE OF INVESTMENTS
November 30, 2002 (unaudited)
Principal
Amount Credit Ratings
(000) (Moody's/S&P) Value*
====================================================================================================================================
VARIABLE RATE NOTES (A) -- 10.3%
------------------------------------------------------------------------------------------------------------------------------------
ALABAMA--1.1%
$ 11,125 Jefferson Cnty. Sewer Rev. Residual Ctfs., Ser. 352, 9.00%, 12/5/02 (FGIC) (b) Aaa/NR $ 10,715,600
3,500 Montgomery Care Fac. Residual Ctfs., Ser. 435, 8.53%, 12/5/02 (MBIA) (b) Aaa/NR 3,298,050
--------------
14,013,650
==============
ALASKA--0.1%
1,000 Valdez Marine Terminal Rev., Exxon Pipeline Proj., 1.25%, 12/2/02 (c) Aaa/AAA 1,000,000
==============
COLORADO--0.4%
5,625 Denver City & Cnty. Airpt Rev. Residual Ctfs., Ser. 425, 8.48%, 12/5/02 (FSA) (b) Aaa/NR 5,458,612
==============
FLORIDA--0.9%
4,455 Orange Cnty. School Board Cert. of Participation, Ser. 328, 8.46%, 12/5/02 (MBIA) (b) Aaa/NR 4,454,376
8,103 State Governmental Utilities Rev. Residual Ctfs., Ser. 327, 8.46%, 12/5/02 (AMBAC) (b) Aaa/NR 7,983,069
--------------
12,437,445
==============
ILLINOIS--1.0%
Chicago GO,
4,450 8.71%, 12/5/02, Ser. 332 (MBIA) (b) Aaa/NR 4,443,414
5,500 9.53%, 12/5/02, Ser. 426 (FGIC) (b) Aaa/NR 5,863,770
3,220 Cook Cnty. Residual Ctfs., Ser. 403, 8.53%, 12/5/02 (FGIC) (b) Aaa/NR 3,109,554
--------------
13,416,738
==============
MASSACHUSETTS--3.2%
3,500 Boston Water & Sewer Community Rev. Residual Ctfs., Ser. 434, 8.61%, 12/5/02 (FGIC) (b) Aa2/NR 3,409,560
State Turnpike Auth. Rev. Residual Ctfs.,
14,163 8.61%, 12/5/02, Ser. 335 (AMBAC) (b) Aaa/NR 13,558,894
7,500 8.61%, 12/5/02, Ser. 489 (AMBAC) (b) Aaa/NR 7,186,950
18,415 8.61%, 12/5/02, Ser. 334 (AMBAC) (b) Aaa/NR 17,646,358
--------------
41,801,762
==============
NEVADA--0.4%
5,500 State GO Residual Ctfs., Ser. 344, 8.46%, 12/5/02 (FGIC) (b) Aaa/NR 5,452,590
==============
NEW YORK--0.2%
City Muni. Water & Sewer System Rev.,
1,000 1.20%, 12/2/02, Ser. C (FGIC) (c) Aaa/AAA 1,000,000
1,500 1.30%, 12/2/02, Ser. G (FGIC) (c) Aaa/AAA 1,500,000
--------------
2,500,000
==============
16 PIMCO Municipal Income Funds II Semi-Annual Report | 11.30.02 |
PIMCO MUNICIPAL INCOME FUND II SCHEDULE OF INVESTMENTS
November 30, 2002 (unaudited)
Principal
Amount Credit Ratings
(000) (Moody's/S&P) Value*
====================================================================================================================================
OHIO--0.3%
$ 3,950 Hamilton Cnty. Sales Tax Residual Ctfs., Ser. 356, 8.53%, 12/5/02 (MBIA) (b) Aaa/NR $ 3,927,564
==============
PENNSYLVANIA--0.7%
Philadelphia School Dist. Residual Ctfs., GO,
4,175 7.96%, 12/5/02, Ser. 345 (MBIA) (b) Aaa/NR 3,803,341
6,693 8.06%, 12/5/02, Ser. 496 (MBIA) (b) Aaa/NR 6,096,734
--------------
9,900,075
==============
TEXAS--1.6%
6,150 Denton Util. Sys. Rev. Residual Ctfs., Ser. 428, 8.78%, 12/5/02 (MBIA) (b) Aaa/NR 6,260,331
2,750 Houston Arpt. Sys. Rev. Residual Ctfs., Ser. 404, 8.41%, 12/5/02 (FGIC) (b) Aaa/NR 2,698,355
Houston Water & Sewer Syst. Rev. Residual Ctfs.,
5,500 8.53%, 12/5/02, Ser. 427 (b) Aaa/NR 5,295,950
6,675 9.03%, 12/5/02, Ser. 495 (b) NR/AAA 6,787,541
--------------
21,042,177
==============
WASHINGTON--0.3%
4,550 Central Puget Sound Regl. Tran. Auth. Sales Tax & Motor Residual Ctfs., Ser. 360,
7.96%, 12/5/02 (b) Aaa/NR 4,088,448
==============
WYOMING--0.1%
1,000 Kemmerer Pollution Control Rev., Exxon Proj., 0.99%, 12/2/02 (c) Aaa/AAA 1,000,000
==============
Total Variable Rate Notes (cost-$132,144,533) 136,039,061
==============
------------------------------------------------------------------------------------------------------------------------------------
TREASURY BILLS--0.5%
------------------------------------------------------------------------------------------------------------------------------------
7,290 1.19%, 2/13/03 (cost-$7,272,168)@ Aaa/AAA 7,273,000
==============
TOTAL INVESTMENTS (cost-$1,331,831,438+)--100.0% $1,325,530,333
==============
====================================================================================================================================
+ The cost basis of securities for federal income tax purposes is
$1,331,831,438. Aggregate gross unrealized appreciation for securities in
which there is an excess of value over tax cost is $9,224,754; aggregate
gross unrealized depreciation for securities in which there is an excess of
tax cost over value is $15,525,859; and net unrealized depreciation for
federal income tax purposes is $6,301,105.
@ All or partial principal amount segregated as initial margin on futures
contracts.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
| 11.30.02 |PIMCO Municipal Income Funds II Semi-Annual Report 17
PIMCO CALIFORNIA MUNICIPAL INCOME FUND II SCHEDULE OF INVESTMENTS
November 30, 2002 (unaudited)
Principal
Amount Credit Ratings
(000) (Moody's/S&P) Value*
====================================================================================================================================
CALIFORNIA MUNICIPAL BONDS & NOTES--92.9%
------------------------------------------------------------------------------------------------------------------------------------
ABC Unified School Dist. GO,
$ 2,000 zero coupon, 8/1/23, Ser. B (FGIC) Aaa/AAA $ 648,080
2,150 zero coupon, 8/1/30-8/1/31 (FGIC) Aaa/AAA 455,060
1,000 Alpine Union School Dist. GO, Ser. B, zero coupon, 8/1/24 (FSA) Aaa/AAA 305,540
8,115 Anaheim City School Dist. GO, 5.00%, 8/1/26 (FGIC) Aaa/AAA 8,103,314
53,000 Bakersfield, CP, Ser. B, zero coupon, 4/15/21NR/AAA 20,100,250
2,000 Bay Area Govt. Assoc. Improvement Bd. Act 1915, 6.30%, 9/2/25 NR/NR 2,030,640
2,000 Bay Area Govt. Assoc. Lease Rev., Ser. 2002-1, 5.00%, 7/1/32 (AMBAC) Aaa/AAA 1,983,440
1,085 Capistrano Unified School Dist., Community Fac. Dist., Special Tax, 5.70%, 9/1/20 NR/NR 1,077,481
3,660 Chula Vista, Special Tax, 6.05%-6.10%, 9/1/25-9/1/32 NR/NR 3,635,535
8,035 Clovis Unified School Dist. GO, Ser. B, zero coupon, 8/1/23-8/1/27 (FGIC) Aaa/AAA 2,311,912
1,410 Community College Financing Auth., Lease Rev., Ser. A, 5.00%, 8/1/27 (AMBAC) Aaa/AAA 1,405,939
3,355 Corona-Norco Unified School Dist. Public Financing Auth., Special Tax.,
Ser. A, 5.55%-6.10%, 9/1/15-9/1/32 NR/NR 3,288,732
1,110 Corona-Norco Unified School Dist. Special Tax., 5.10%, 9/1/25 (AMBAC) Aaa/AAA 1,122,665
2,800 Cotati Redev. Agcy Tax Allocation, Ser. A, 5.00%, 9/1/31 (MBIA) Aaa/AAA 2,778,664
3,000 Dinuba Financing Auth., Lease Rev.,5.10%, 8/1/32 (MBIA) Aaa/AAA 3,026,070
2,825 Empire Union School Dist. Special Tax., zero coupon, 10/1/30-10/1/32 (AMBAC) Aaa/AAA 578,414
1,000 Escondido Union School Dist. GO, zero coupon, 8/1/27 (FSA) Aaa/AAA 257,410
2,440 Eureka Unified School Dist. GO, zero coupon, 8/1/27 (FSA) Aaa/AAA 628,080
Foothill Eastern Corrider Agcy. Toll Road Rev.,
1,500 5.875%, 1/15/27 (MBIA) Aaa/AAA 1,046,505
42,010 zero coupon, 1/1/25-1/1/30, Ser. A Aaa/AAA 10,806,612
850 Golden Valley Unified School Dist. GO, zero coupon, 8/1/35 (FGIC) Aaa/AAA 139,536
2,115 Health Facs. Financing Auth. Rev., 5.375%, 11/1/20 NR/A+ 2,175,954
18 PIMCO Municipal Income Funds II Semi-Annual Report | 11.30.02 |
PIMCO CALIFORNIA MUNICIPAL INCOME FUND II SCHEDULE OF INVESTMENTS
November 30, 2002 (unaudited)
Principal
Amount Credit Ratings
(000) (Moody's/S&P) Value*
====================================================================================================================================
$ 1,750 Huntington Beach Community Facs. Dist. Special Tax, 6.30%, 9/1/32 NR/NR $ 1,762,443
2,080 Industry Urban Dev. Agcy. Tax Allocation, 4.75%, 5/1/21 (MBIA) Aaa/AAA 2,057,266
7,000 Irvine Improvement Board Act 1915 Special Assessment, 5.70%, 9/2/26 NR/NR 6,963,250
1,900 Jurupa Unified School Dist. GO, zero coupon, 5/1/27 (FGIC) Aaa/AAA 489,079
2,450 Kings Canyon JT Unified School Dist., GO, zero coupon, 8/1/27 (FGIC) Aaa/AAA 630,655
5,300 Livermore-Amador Valley Water Management Agcy., Sewer Rev., 5.00%, 8/1/31 (AMBAC) Aaa/AAA 5,259,720
5,935 Long Beach Unified School Dist., GO, Ser. C, 5.00%, 8/1/27 (MBIA) Aaa/NR 5,917,907
Los Angeles, CP,
9,895 5.00%, 2/1/27 (MBIA) Aaa/AAA 9,866,799
2,685 5.00%, 10/1/27, Ser. AU (MBIA) Aaa/AAA 2,677,240
Los Angeles Dept. of Water & Power, Waterworks Rev.,
16,950 5.125%, 7/1/41, Ser. A (FGIC) NR/AAA 17,001,867
10,000 5.125%, 7/1/41 (MBIA) Aaa/AAA 10,030,600
Los Angeles Wastewater Syst. Rev., Ser A,
12,200 5.00%, 6/1/28-6/1/30 (FGIC) Aaa/AAA 12,135,926
1,000 Manhattan Beach Unified School Dist. GO, zero coupon, 9/1/25 (FGIC) Aaa/AAA 287,310
7,295 Manteca Redev. Agcy, Tax Allocation, 5.00%, 10/1/32 (FSA) Aaa/AAA 7,238,610
Manteca Unified School Dist. Special Tax,
5,330 5.00%, 9/1/29, Ser. C Aaa/AAA 5,298,446
2,365 zero coupon, 9/1/25 (MBIA) Aaa/AAA 679,488
4,000 Merced Cnty, CP., 5.00%, 6/1/32 (AMBAC) Aaa/NR 3,968,280
7,320 Modesto Elementary School Dist., Stanislaus Cnty. GO,
zero coupon, 8/1/23-8/1/27, Ser. A (FGIC) Aaa/AAA 2,195,790
2,150 Modesto High School Dist., Stanislaus Cnty. GO, zero coupon, 8/1/26, Ser. A (FGIC) Aaa/AAA 586,090
1,000 Modesto Public Financing Auth. Lease Rev., 5.00%, 9/1/29 (AMBAC) Aaa/AAA 994,080
2,385 Monrovia Financing Auth. Lease Rev., 5.125%, 12/1/31 (AMBAC) Aaa/AAA 2,400,932
Montebello Unified School Dist. GO,
7,105 zero coupon, 8/1/24-8/1/27 (FGIC) Aaa/AAA 1,989,446
1,485 zero coupon, 8/1/24 (FSA) Aaa/AAA 453,727
2,400 Morgan Hill Unified School Dist. GO, zero coupon, 8/1/23 (FGIC) Aaa/AAA 777,696
| 11.30.02 | PIMCO Municipal Income Funds II Semi-Annual Report 19
PIMCO CALIFORNIA MUNICIPAL INCOME FUND II SCHEDULE OF INVESTMENTS
November 30, 2002 (unaudited)
Principal
Amount Credit Ratings
(000) (Moody's/S&P) Value*
====================================================================================================================================
$ 1,500 Mountain View-Whisman School Dist. GO, Ser. D, 5.00%, 6/1/27(MBIA) Aaa/AAA $ 1,495,785
1,800 Murrieta Redev. Agcy. Tax, 5.00%, 8/1/32 (MBIA)Aaa/AAA 1,786,122
3,245 Newark Unified School Dist. GO, Ser. D, zero coupon, 8/1/26 (FSA) Aaa/AAA 874,463
2,750 North City West School Facs. Financing Auth., Special Tax, zero coupon, 9/1/27 (AMBAC) Aaa/AAA 704,633
19,805 Oakland, GO, Ser. A, 5.00%, 1/15/27-1/15/32 (FGIC) Aaa/AAA 19,695,392
1,000 Orange Cnty. Community Facs. Dist. Special Tax, Ser. A, 6.00%, 8/15/25 NR/NR 1,010,010
3,685 Palmdale Community Redev. Agcy, Tax Allocation, zero coupon, 12/1/30-12/1/32 (AMBAC) Aaa/AAA 742,510
1,750 Paramount Unified School Dist. GO, Ser. B, zero coupon, 9/1/23 (FSA) Aaa/AAA 564,497
Perris Public Financing Auth. Rev.,
2,650 4.75%-4.875%, 10/1/23-10/1/31, Ser. B (MBIA) Aaa/AAA 2,577,517
2,580 5.375%-5.625%, 10/1/20-10/1/31, Ser. C NR/NR 2,518,858
1,410 Pomona Public Financing Auth. Rev., Ser. AF, 5.00%, 12/1/37 (MBIA) Aaa/AAA 1,391,628
7,700 Poway Unified School Dist. Special Tax, 5.50%-5.70%, 9/1/25-9/1/33, NR/NR 7,311,235
2,000 Rancho Cucamonga Community Facs. Dist. Special Tax, 6.375%, 9/1/31, Ser. A NR/NR 2,014,320
1,500 Richmond Wastewater Rev., zero coupon, 8/1/30 (FGIC) Aaa/AAA 325,590
17,500 Rocklin Unififed School Dist. GO, zero coupon, 8/1/24-8/1/27 (FGIC) Aaa/AAA 4,930,965
9,250 Roseville Redev. Agcy. Tax Allocation, 5.00%, 9/1/27-9/1/33 (MBIA) Aaa/AAA 9,196,314
Sacramento City Financing Auth. Rev., Ser. A,
4,500 5.00%, 12/1/32 (FSA) Aaa/AAA 4,465,395
1,000 6.25%, 9/1/23 NR/NR 1,026,410
16,000 Sacramento Cnty. Airport Syst. Rev., Ser. A, 5.00%, 7/1/32 (FSA) Aaa/AAA 15,877,120
16,285 San Diego Cnty. Water Auth. Water Rev., CP, Ser. A, 5.00%, 5/1/28-5/1/29 (MBIA) Aaa/AAA 16,202,409
1,000 San Diego Public Facs. Financing Auth. Sewer Rev., Ser. A, 5.00%, 5/15/29 (FGIC) Aaa/AAA 994,160
1,500 San Diego Public Facs. Financing Auth. Lease Rev., 5.00%, 4/1/32 (MBIA) Aaa/AAA 1,488,480
26,460 San Diego Public Facs. Financing Auth. Water Rev., 5.00%, 8/1/32 (MBIA) Aaa/AAA 26,255,993
San Diego Unified School Dist. GO,
8,835 5.00%, 7/1/26, Ser. C (FSA) Aaa/AAA 8,822,543
7,775 5.00%, 7/1/27, Ser. D (FGIC) Aaa/AAA 7,752,841
20 PIMCO Municipal Income Funds II Semi-Annual Report | 11.30.02 |
PIMCO CALIFORNIA MUNICIPAL INCOME FUND II SCHEDULE OF INVESTMENTS
November 30, 2002 (unaudited)
Principal
Amount Credit Ratings
(000) (Moody's/S&P) Value*
====================================================================================================================================
San Francisco City & Cnty. Airport Community, Int'l Airport Rev.,
$ 5,585 4.50%, 5/1/28, Ser. 15B (MBIA) Aaa/AAA $ 5,125,355
20,300 5.00%, 5/1/32, Ser. 28B (MBIA) Aaa/AAA 20,144,502
9,060 San Francisco City & Cnty. Public Utilities Community
Water Rev., Ser. A, 5.00%, 11/1/26-11/1/27 (MBIA) Aaa/AAA 9,036,014
10,405 San Joaquins Hills Transportation Corridor Agcy. Toll Road Rev., zero coupon, 1/1/25 AAA/AAA 3,147,825
San Jose, GO,
14,970 5.00%, 9/1/32 (MBIA) Aaa/AAA 14,854,282
10,190 5.125%, 9/1/31 (MBIA) Aa1/AA+ 10,242,682
9,150 San Jose Unified School Dist. Santa Clara Cnty. GO, 5.00%, 8/1/27, Ser. A (FSA) Aaa/AAA 9,123,648
7,875 San Juan Unified School Dist. GO, zero coupon, 8/1/23-8/1/26 (FSA) Aaa/AAA 2,237,774
4,835 San Mateo Foster City School Dist. GO, 5.10%, 8/1/31 (FGIC) Aaa/AAA 4,852,986
2,300 San Mateo Union High School Dist. GO, zero coupon, 9/1/20 (FGIC) Aaa/AAA 902,957
1,730 San Rafael City High School Dist. GO, Ser. B, 5.00% 8/1/27 (FSA) Aaa/AAA 1,725,018
3,280 San Rafael Elementary School Dist. GO, Ser. B, 5.00%, 8/1/27 (FSA) Aaa/AAA 3,270,554
8,690 Santa Clara Unified School Dist. GO, 5.00%, 7/1/25-7/1/27 (MBIA) NR/AAA 8,677,144
1,260 Santa Cruz Cnty., CP, 5.25%, 8/1/32 A2/NR 1,250,537
3,500 Saugus Hart School Facs. Financing Auth. Special Tax, 6.10%-6.13%, 9/1/32-9/1/33 NR/NR 3,523,136
2,000 Saugus Union School Dist. GO, Ser. A, 4.75%, 8/1/27 (FGIC) Aaa/AAA 1,923,980
1,000 Shasta Union High School Dist. GO, zero coupon, 8/1/24 (FGIC) Aaa/AAA 305,540
12,975 South Gate Utility Auth. Rev., 5.00%, 10/1/32 (FGIC) NR/AAA 12,874,703
4,745 South Tahoe JT Powers Parking Financing Auth. Rev., Ser. A, 7.00%, 12/1/27 NR/NR 4,744,953
1,800 Southern Mono Health Care Dist. GO, zero coupon, 8/1/26 (MBIA) Aaa/AAA 485,064
| 11.30.02 | PIMCO Municipal Income Funds II Semi-Annual Report 21
PIMCO CALIFORNIA MUNICIPAL INCOME FUND II SCHEDULE OF INVESTMENTS
November 30, 2002 (unaudited)
Principal
Amount Credit Ratings
(000) (Moody's/S&P) Value*
====================================================================================================================================
State GO,
$ 1,650 5.00%, 4/1/27 (AMBAC) Aaa/AAA $ 1,645,281
7,780 5.25%, 2/1/30 Aaa/AAA 7,898,100
62,200 6.25%, 9/1/12 (MBIA) Aaa/AAA 73,781,640
9,605 State Public Works Board Lease Rev., Ser. A, 5.00%, 10/1/22 (FSA) Aaa/AAA 9,663,590
1,710 State University Rev. & Colleges, Ser. A, 5.00%, 11/1/33 (AMBAC) Aaa/AAA 1,696,611
1,170 Statewide Community Dev. Auth. CP, 6.10%, 11/1/15 (b) NR/NR 1,187,936
2,000 Statewide Community Dev. Auth. Rev., 6.75%, 7/1/32 (b) NR/NR 2,034,620
Statewide Financing Auth. Tobacco Settlement Rev.,
2,000 5.625%, 5/1/29, Ser. A A1/NR 1,926,480
20,000 6.00%, 5/1/37, Ser. B A1/NR 19,599,600
7,750 Tamalpais Union High School Dist. GO, 5.00%, 8/1/27 (FSA) Aaa/AAA 7,727,680
Tobacco Securization Agcy. Rev.,
15,000 5.625%-6.00%, 6/1/23-6/1/35 A1/A 14,493,850
1,800 5.875%, 6/1/43, Ser. A A1/A+ 1,754,172
4,500 6.00%, 6/1/42 A1/NR 4,393,710
1,000 Tracy Community Facs. Dist. Special Tax, 6.00%, 9/1/27 NR/NR 994,790
7,815 Tustin Unified School Dist. Special Tax, 5.00%, 9/1/38 (FSA) Aaa/AAA 7,711,842
20,910 University Revs., Ser. O, 5.00%, 9/1/27-9/1/28 (FGIC) Aaa/AAA 20,833,314
10,000 Ventura Cnty. Community College Dist. GO, Ser. A, 5.00%, 8/1/27 (MBIA) Aaa/AAA 9,971,200
1,555 Ventura Unified School Dist., GO, Ser. F Ser. F, 5.00%, 8/1/32 (FSA) Aaa/AAA 1,543,011
3,535 Victor Elementary School Dist., Ser. A, zero coupon, 8/1/24-8/1/26 (FGIC) Aaa/AAA 1,000,485
1,000 Vista Unified School Dist. GO, Ser. A, zero coupon, 8/1/26 (FSA) Aaa/AAA 272,600
7,320 West Contra Costa University School Dist. GO, Ser. A, 5.00%, 8/1/26-8/1/31 (MBIA) Aaa/AAA 7,289,962
3,375 Westlands Water Dist. Rev. CP, 5.00%, 9/1/34 (MBIA) Aaa/AAA 3,348,169
2,110 Yuba City Unified School Dist. GO, zero coupon, 9/1/25 (FGIC) Aaa/AAA 606,224
--------------
Total California Municipal Bonds & Notes (cost-$630,861,752) 629,417,191
==============
16 PIMCO Municipal Income Funds II Semi-Annual Report | 11.30.02 |
PIMCO CALIFORNIA MUNICIPAL INCOME FUND II SCHEDULE OF INVESTMENTS
November 30, 2002 (unaudited)
Principal
Amount Credit Ratings
(000) (Moody's/S&P) Value*
====================================================================================================================================
PUERTO RICO MUNICIPAL BONDS & NOTES--3.6%
------------------------------------------------------------------------------------------------------------------------------------
PUERTO RICO--3.6%
$ 16,700 Children Trust Fund Tobacco Settlement Rev., 5.625%, 5/15/43 A1/A $ 16,194,825
7,500 Public Building Auth. Rev., Ser. G, 4.75%, 7/1/32 Baa1/A- 6,992,850
1,000 Tel. Auth. Rev., 5.25%, 1/25/07 (MBIA) Aaa/AAA 1,017,320
--------------
Total Puerto Rico Municipal Bonds & Notes (cost-$24,580,379) 24,204,995
==============
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA VARIABLE RATE NOTES (A)--1.0%
------------------------------------------------------------------------------------------------------------------------------------
2,100 Bay Area Toll Auth. Toll Bridge Rev., 1.05%, 12/5/02 (AMBAC) (c) VMIG1/A1+ 2,100,000
1,400 Metropolitan Water Dist. Southern Waterworks Rev., Ser. A, 1.00%, 12/5/02 (AMBAC) (c) VMIG1/A1+ 1,400,000
3,250 Modesto Public Financing Auth. Lease Rev., Ser. 354, 8.64%, 12/5/02 (AMBAC) (b) AAA/NR 3,211,520
--------------
Total California Variable Rate Notes (cost-$6,665,448) 6,711,520
==============
------------------------------------------------------------------------------------------------------------------------------------
OTHER VARIABLE RATE NOTES (A)(C)--2.5%
------------------------------------------------------------------------------------------------------------------------------------
CONNECTICUT--0.7%
1,000 State Housing Fin. Auth., SubSer. D-3, 1.10%, 12/5/02 (AMBAC) VMIG1/A1+ 1,000,000
3,700 State Health & Educational Facs. Auth. Rev., Ser. V-1, 1.30%, 12/2/02 VMIG1/A1+ 3,700,000
--------------
4,700,000
==============
LOUISIANA--0.3%
2,000 East Baton Rouge Parish, Pollution Control Revenue, 1.20%, 12/2/02 P-1/A1+ 2,000,000
==============
MASSACHUSETTS--0.8%
State Health & Educational Facs. Auth. Rev.,
600 1.05%, 12/5/02, SER. J2 VMIG1/A1+ 600,000
1,100 1.05%, 12/5/02, SER. Y VMIG1/A1+ 1,100,000
4,000 State Water Resources Auth., Ser. D, 1.30%, 12/2/02 (LOC-Landesbank Baden) VMIG1/A1+ 4,000,000
--------------
5,700,000
==============
NEW JERSEY--0.2%
1,000 State Educational Facs. Auth. Rev., Ser. B, 1.30%, 12/2/02 VMIG1/A1+ 1,000,000
==============
| 11.30.02 | PIMCO Municipal Income Funds II Semi-Annual Report 23
PIMCO CALIFORNIA MUNICIPAL INCOME FUND II SCHEDULE OF INVESTMENTS
November 30, 2002 (unaudited)
Principal
Amount Credit Ratings
(000) (Moody's/S&P) Value*
====================================================================================================================================
NEW YORK--0.4%
$1,500 New York City Municipal Water Fin. Auth., Water
& Sewer Syst. Rev., Ser. G, 1.30%, 12/2/02 (FGIC) VMIG1/A1+ $ 1,500,000
1,300 State Dorm. Auth. Rev., Cornell Univ., Ser A, 1.10%, 12/5/02 (Toronto Dominion Bank) Aa1/A1+ 1,300,000
--------------
2,800,000
==============
TEXAS--0.1%
500 Gulf Coast Waste Disposal Auth., Pollution Control Rev., 1.20%, 12/2/02 VMIG1/A1+ 500,000
500 Harris Cnty. Health Facs. Dev. Corp., Hospital Rev., Ser. B-1, 1.30%, 12/2/02 (MBIA) VMIG1/A1+ 500,000
--------------
1,000,000
==============
WASHINGTON--0.0%
250 State Health Care Facs. Auth. Rev., Ser. A, 1.25%, 12/2/02 (MBIA) Aaa/A1+ 250,000
--------------
Total Other Variable Rate Notes (cost $17,450,000) 17,450,000
--------------
TOTAL INVESTMENTS (cost-$679,557,579++)--100.0% $677,783,706
==============
====================================================================================================================================
++ The cost basis of securities for federal income tax purposes is $679,557,579.
Aggregate gross unrealized appreciation for securities in which there is an
excess of value over tax cost is $4,282,530; aggregate gross unrealized
depreciation for securities in which there is an excess of tax cost over
value is $6,056,403; and net unrealized depreciation for federal income tax
purposes is $1,773,873.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
24 PIMCO Municipal Income Funds II Semi-Annual Report | 11.30.02 |
PIMCO NEW YORK MUNICIPAL INCOME FUND II SCHEDULE OF INVESTMENTS
November 30, 2002 (unaudited)
Principal
Amount Credit Ratings
(000) (Moody's/S&P) Value*
====================================================================================================================================
NEW YORK MUNICIPAL BONDS & NOTES--79.7%
------------------------------------------------------------------------------------------------------------------------------------
$ 1,250 Buffalo Municipal Water Fin. Auth. Water Syst.
Rev., Ser. B, 5.00%-5.125%, 7/1/27-7/15/32 (FSA) Aaa/AAA $ 1,251,180
4,620 Chappaqua Central School Dist. GO, Ser. B, 4.70%, 9/1/26-9/1/30 (MBIA) Aaa/NR 4,387,164
10,000 Erie Cnty. Tobacco Asset, 6.50%, 7/15/32 A1/A 10,517,000
5,000 Metropolitan Transportation Auth. Dedicated Tax Fund, Ser. A, 5.00%, 11/15/30 A1/AA- 4,846,200
Metropolitan Transportation Auth. Rev.,
1,850 5.00%, 11/15/30, Ser. A (FSA) Aaa/AAA 1,830,704
10,000 5.25%, 11/15/31, Ser. E A2/A 10,100,000
7,000 Metropolitan Transportation Auth. Service Contract, Ser. B, 5.35%, 7/1/31 A3/AA- 7,120,330
New York City GO,
1,500 5.75%, 8/1/16, Ser. A A2/A 1,571,190
5,000 5.75%, 8/1/14, Ser. B A2/A 5,331,500
3,100 New York City Health & Hospital Corp. Rev., Ser. A, 5.375%-5.45%, 2/15/26 A3/BBB 3,086,581
1,250 New York City Indl. Dev. Agcy. Civic Fac. Rev., 6.45%, 7/1/32 Baa3/NR 1,248,600
1,000 New York City Indl. Dev. Agcy. Rev., 4.95%, 11/20/32 (GNMA) NR/AAA 950,590
New York City Municipal Water Fin. Auth. Water & Sewer Syst. Rev., Ser. A,
5,000 4.75%, 6/15/31 (FGIC) Aaa/AAA 4,738,350
15,000 5.125%, 6/15/34 Aa2/aa 15,016,500
New York City Transitional Fin. Auth. Rev.,
7,195 5.00%, 5/1/23, Ser. A (FGIC) Aaa/AAA 7,076,426
10,000 5.00%, 11/1/27, Ser. B Aa2/AA+ 9,817,900
3,600 Port Auth. of New York & New Jersey, 5.00%, 4/15/32 Aaa/AAA 3,577,824
7,500 State Dormitory Auth. Lease Rev., State Univ. Dormitory Facs., 5.00%, 7/1/32 A1/AA- 7,252,425
3,225 State Dormitory Auth. Revs., FHA-NY & Presbyterian Hospital, 4.75%, 8/1/27 (AMBAC) Aaa/AAA 3,084,842
5,000 State Dormitory Auth. Revs., FHA-Saint Barnabas, Ser. A, 5.00%, 2/1/31 (AMBAC) Aaa/AAA 4,932,700
3,500 State Dormitory Auth. Revs., Fordham Univ., 5.00%, 7/1/32 (FGIC) Aaa/AAA 3,478,440
5,300 State Dormitory Auth. Revs., Lenox Hill Hospital 5.50%, 7/1/30 A3/NR 5,292,262
| 11.30.02 | PIMCO Municipal Income Funds II Semi-Annual Report 25
PIMCO NEW YORK MUNICIPAL INCOME FUND II SCHEDULE OF INVESTMENTS
November 30, 2002 (unaudited)
Principal
Amount Credit Ratings
(000) (Moody's/S&P) Value*
====================================================================================================================================
$ 1,400 State Dormitory Auth. Revs., Long Island Univ., 5.25%, 9/1/28 NR/AA $ 1,414,546
4,000 State Dormitory Auth. Revs., Rockefeller Univ., 4.75%, 7/1/37 Aaa/AAA 3,829,760
4,270 State Dormitory Auth. Rev., Teachers College, 5.00%, 7/1/32 (MBIA) Aaa/NR 4,211,416
2,000 State Environmental Facs. Corp., State Clean Water & Drinking, 5.125%, 6/15/31 Aaa/AAA 2,005,200
4,500 State Power Auth., Ser. A, 4.75%, 11/15/22 Aa2/AA- 4,364,415
10,000 State Urban Dev. Corp., Correctional & Youth Facs. Services, Ser. A, 5.50%, 1/1/17. NR/AA- 10,811,000
Triborough Bridge & Tunnel Auth. Revs., Ser. A,
4,700 5.00%, 1/1/32 Aa3/AA- 4,635,986
6,000 5.00%, 1/1/27 (FGIC) Aaa/AAA 5,917,080
Tobacco Settlement Asset Backed, Inc.,
25,000 5.75%, 7/15/32 Aa2/A+ 24,763,000
10,000 6.375%, 7/15/39 Aa3/A+ 10,537,600
--------------
Total New York Municipal Bonds & Notes (cost-$189,181,096) 188,998,711
==============
------------------------------------------------------------------------------------------------------------------------------------
PUERTO RICO MUNICIPAL BONDS & NOTES--4.4%
------------------------------------------------------------------------------------------------------------------------------------
5,675 ChildrenTrust Fund Puerto Rico Tobacco Settlement Rev., 5.625%, 5/15/43 A1/A 5,503,331
1,500 Puerto Rico Commonwealth Highway & Transportation Auth., Ser. D, 5.25%, 7/1/38 Baa1/A 1,506,660
2,500 Puerto Rico Public Building Auth. Rev., Ser G, 4.75%, 7/1/32 Baa1/A- 2,330,950
1,000 Puerto Rico Tel. Auth. Rev., 5.25%, 1/25/07 (MBIA) Aaa/AAA 1,017,320
--------------
Total Puerto Rico Municipal Bonds & Notes (cost-$10,481,006) 10,358,261
==============
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK VARIABLE RATE NOTES (A)-15.1%
------------------------------------------------------------------------------------------------------------------------------------
13,988 Long Island Power Auth. Elec. Syst. Rev., Ser. 339, 9.08%, 12/5/02 (MBIA) (b) Aaa/NR 14,860,600
5,100 Nassau Cnty Interim Fin. Auth., Ser B, 1.05%, 12/4/02 (FSA) (c) VMIG1/A1+ 5,100,000
6,565 New York City Municipal Water Fin. Auth., Water &
Sewer Syst. Rev., Ser. 364, 7.98%, 12/5/02 (MBIA) (b) Aaa/NR 6,072,494
2,000 State Dormitory Auth. Rev., Columbia Univ., Ser. C, 1.20%, 12/5/02 (c) Aaa/A1+ 2,000,000
26 PIMCO Municipal Income Funds II Semi-Annual Report | 11.30.02 |
PIMCO NEW YORK MUNICIPAL INCOME FUND II SCHEDULE OF INVESTMENTS
November 30, 2002 (unaudited)
Principal
Amount Credit Ratings
(000) (Moody's/S&P) Value*
====================================================================================================================================
State Dormitory Auth. Rev., Cornell Univ., Ser. B,
$ 2,000 1.10%, 12/5/02 (Toronto Dominion Bank) (c) Aa1/A1+ $ 2,000,000
1,400 1.25%, 12/5/02 (Morgan Guaranty Trust) (c) VMIG1/A1+ 1,400,000
1,500 State Dormitory Auth. Rev., NY Public Library, Ser. A, 1.10%, 12/4/02 (MBIA) (c) VMIG1/A1 1,500,000
3,000 State Local Govt. Assistance Corp., Ser. C, 1.05%, 12/4/02 (Landesbank Hessen) (c) VMIG1/A1+ 3,000,000
--------------
Total New York Variable Rate Notes (cost-$34,876,192) 35,933,094
==============
------------------------------------------------------------------------------------------------------------------------------------
OTHER VARIABLE RATE NOTES (A)(C)--0.8%
------------------------------------------------------------------------------------------------------------------------------------
RHODE ISLAND--0.8%
1,800 State Island Industrial Corp. Marine Terminal Rev., 1.25%, 12/2/02 (cost-$1,800,000) Aaa/A1+ 1,800,000
--------------
TOTAL INVESTMENTS (cost-$236,338,294+++)-100.0% $237,090,066
==============
================================================================================
+++ The cost basis of securities for federal income tax purposes is
$236,338,294. Aggregate gross unrealized appreciation for securities in
which there is an excess of value over tax cost is $2,716,531; aggregate
gross unrealized depreciation for securities in which there is an excess of
tax cost over value is $1,964,759; and net unrealized appreciation for
federal income tax purposes is $751,772.
================================================================================
NOTES TO SCHEDULE OF INVESTMENTS
* Long-term debt securities are valued by an independent pricing service
authorized by the Board of Trustees.
(a) Variable Rate Notes are instruments whose interest rates change on a
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). Maturity date shown is date of next rate change.
(b) Security exempt from registration under Rule 144a of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, typically to qualified institutional investors. At November
30, 2002, these securities amounted to $131,539,061 or 9.9% of investments,
$6,434,076 or 0.9% of investments and $20,933,094 or 8.8% of investments,
respectively, for Municipal II, California Municipal II and New York
Municipal II.
(c) Variable Rate Demand Notes.
================================================================================
GLOSSARY:
AMBAC -- insured by American Municipal Bond Assurance Corp.
CP -- Certificates of Participation
FGIC -- insured by insured Financial Guaranty Insurance Co.
FHA -- insured by Federal Housing Administration
FSA -- insured by Financial Security Assurance, Inc.
GNMA -- Government National Mortgage Association
GO -- General Obligation Bonds
LOC -- Letter of Credit
MBIA -- insured by Municipal Bond Investors Assurance
NR -- Not Rated
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
| 11.30.02 | PIMCO Municipal Income Funds II Semi-Annual Report 27
PIMCO MUNICIPAL INCOME FUNDS II STATEMENTS OF ASSETS AND LIABILITIES
November 30, 2002 (unaudited)
CALIFORNIA NEW YORK
MUNICIPAL II MUNICIPAL II MUNICIPAL II
-------------- ------------ ------------
ASSETS:
Investments, at value (cost-$1,331,831,438,
$679,557,579 and $236,338,294, respectively) $1,325,530,333 $677,783,706 $237,090,066
--------------------------------------------------------------- ---------------- -------------- --------------
Cash 2,654,647 -- 350,989
--------------------------------------------------------------- ---------------- -------------- --------------
Interest receivable 19,149,817 8,284,988 3,602,121
--------------------------------------------------------------- ---------------- -------------- --------------
Receivable for investments called -- -- 1,650,104
--------------------------------------------------------------- ---------------- -------------- --------------
Prepaid expenses 26,904 25,127 11,489
--------------------------------------------------------------- ---------------- -------------- --------------
Total Assets 1,347,361,701 686,093,821 242,704,769
=============================================================== ================ ============== ==============
LIABILITIES:
Due to custodian -- 1,324,722 --
--------------------------------------------------------------- ---------------- -------------- --------------
Payable for investments purchased 14,861,378 1,200,045 5,003,472
--------------------------------------------------------------- ---------------- -------------- --------------
Dividends payable to common and preferred shareholders 4,950,912 2,465,089 851,834
--------------------------------------------------------------- ---------------- -------------- --------------
Payable for variation margin on futures contracts 1,171,875 -- --
--------------------------------------------------------------- ---------------- -------------- --------------
Investment management fee payable 550,120 282,897 98,265
--------------------------------------------------------------- ---------------- -------------- --------------
Common stock offering costs payable 196,100 37,726 296
--------------------------------------------------------------- ---------------- -------------- --------------
Preferred shares offering costs payable 21,733 99,712 31,854
--------------------------------------------------------------- ---------------- -------------- --------------
Accrued expenses 95,289 56,197 28,691
--------------------------------------------------------------- ---------------- -------------- --------------
Total Liabilities 21,847,407 5,466,388 6,014,412
--------------------------------------------------------------- ---------------- -------------- --------------
Preferred shares ($25,000 net asset and liquidation
value per share applicable to an aggregate of 20,200,
10,400 and 3,600 shares issued and outstanding,
respectively) 505,000,000 260,000,000 90,000,000
--------------------------------------------------------------- ---------------- -------------- --------------
NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS $ 820,514,294 $420,627,433 $146,690,357
=============================================================== ================ ============== ==============
COMPOSITION OF NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS:
Common stock, par value $0.00001 per share $ 577 $ 300 $ 103
--------------------------------------------------------------- ---------------- -------------- --------------
Paid-in-capital in excess of par 819,809,396 425,701,684 146,639,802
--------------------------------------------------------------- ---------------- -------------- --------------
Dividends in excess of net investment income (2,453,157) (2,163,167) (486,635)
--------------------------------------------------------------- ---------------- -------------- --------------
Net realized loss on investments (2,416,417) (1,137,511) (214,685)
--------------------------------------------------------------- ---------------- -------------- --------------
Net unrealized appreciation (depreciation) of
investments and futures contracts 5,573,895 (1,773,873) 751,772
--------------------------------------------------------------- ---------------- -------------- --------------
NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS $ 820,514,294 $420,627,433 $146,690,357
=============================================================== ================ ============== ==============
Common Shares Outstanding 57,683,218 29,965,192 10,332,368
--------------------------------------------------------------- ---------------- -------------- --------------
NET ASSET VALUE PER COMMON SHARE $14.22 $14.04 $14.20
=============================================================== ================ ============== ==============
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
28 PIMCO Municipal Income Funds II Semi-Annual Report | 11.30.02 |
PIMCO MUNICIPAL INCOME FUNDS II STATEMENTS OF OPERATIONS
For the period June 28, 2002* through November 30, 2002 (unaudited)
CALIFORNIA NEW YORK
MUNICIPAL II MUNICIPAL II MUNICIPAL II
--------------------------------------------------------------- ---------------- -------------- --------------
INVESTMENT INCOME:
Interest $ 21,934,133 $ 10,039,518 $ 3,753,015
------------------------------------------------------------ -------------- ------------ ------------
EXPENSES:
Investment management fees 3,202,849 1,656,662 572,384
------------------------------------------------------------ -------------- ------------ ------------
Auction agent fees and commissions 354,052 184,550 64,551
------------------------------------------------------------ -------------- ------------ ------------
Custodian and accounting agent fees 170,964 71,055 38,134
------------------------------------------------------------ -------------- ------------ ------------
Trustees' fees 24,960 12,480 4,680
------------------------------------------------------------ -------------- ------------ ------------
Legal fees 23,400 10,920 3,900
------------------------------------------------------------ -------------- ------------ ------------
Audit and tax service fees 22,660 12,500 5,710
------------------------------------------------------------ -------------- ------------ ------------
New York Stock Exchange listing fee 19,291 13,948 9,962
------------------------------------------------------------ -------------- ------------ ------------
Reports to shareholders 15,600 9,360 2,340
------------------------------------------------------------ -------------- ------------ ------------
Transfer agent fees 12,480 10,920 10,920
------------------------------------------------------------ -------------- ------------ ------------
Miscellaneous 8,722 5,587 2,649
------------------------------------------------------------ -------------- ------------ ------------
Total expenses 3,854,978 1,987,982 715,230
------------------------------------------------------------ -------------- ------------ ------------
Less: investment management fees waived (739,119) (382,306) (132,089)
------------------------------------------------------------ -------------- ------------ ------------
expense offset (145,764) (54,045) (29,629)
------------------------------------------------------------ -------------- ------------ ------------
Net expenses 2,970,095 1,551,631 553,512
------------------------------------------------------------ -------------- ------------ ------------
NET INVESTMENT INCOME $ 18,964,038 $ 8,487,887 $ 3,199,503
============================================================ ============== ============ ============
REALIZED AND UNREALIZED GAIN (LOSS):
Net realized gain (loss) on:
Investments 371,463 (9,859) 67,228
------------------------------------------------------------ -------------- ------------ ------------
Futures contracts (2,787,880) (1,127,652) (281,913)
------------------------------------------------------------ -------------- ------------ ------------
Net unrealized appreciation (depreciation) of
investments and futures contracts 5,573,895 (1,773,873) 751,772
------------------------------------------------------------ -------------- ------------ ------------
Net realized and unrealized gain (loss) 3,157,478 (2,911,384) 537,087
------------------------------------------------------------ -------------- ------------ ------------
NET INCREASE IN NET ASSETS RESULTING FROM
INVESTMENT OPERATIONS 22,121,516 5,576,503 3,736,590
============================================================ ============== ============ ============
DIVIDENDS ON PREFERRED SHARES FROM
NET INVESTMENT INCOME (1,977,427) (919,305) (331,739)
============================================================ ============== ============ ============
NET INCREASE IN NET ASSETS APPLICABLE TO COMMON
SHAREHOLDERS RESULTING FROM INVESTMENT OPERATIONS $ 20,144,089 $ 4,657,198 $ 3,404,851
============================================================ ============== ============ ============
* Commencement of operations
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
| 11.30.02 | PIMCO Municipal Income Funds II Semi-Annual Report 29
PIMCO MUNICIPAL INCOME FUNDS II STATEMENTS OF CHANGES IN NET ASSETS APPLICABLE
TO COMMON SHAREHOLDERS
For the period June 28, 2002* through November 30, 2002 (unaudited)
CALIFORNIA NEW YORK
MUNICIPAL II MUNICIPAL II MUNICIPAL II
-------------- ------------ ------------
INVESTMENT OPERATIONS:
Net investment income $ 18,964,038 $ 8,487,887 $ 3,199,503
-------------------------------------------------------------- -------------- ------------ ------------
Net realized loss on investments and futures contracts (2,416,417) (1,137,511) (214,685)
-------------------------------------------------------------- -------------- ------------ ------------
Net unrealized appreciation (depreciation) on
investments and futures contracts 5,573,895 (1,773,873) 751,772
-------------------------------------------------------------- -------------- ------------ ------------
Net increase in net assets resulting from investment
operations 22,121,516 5,576,503 3,736,590
-------------------------------------------------------------- -------------- ------------ ------------
DIVIDENDS ON PREFERRED SHARES FROM
NET INVESTMENT INCOME (1,977,427) (919,305) (331,739)
-------------------------------------------------------------- -------------- ------------ ------------
Net increase in net assets applicable to common
shareholders resulting from investment operations 20,144,089 4,657,198 3,404,851
-------------------------------------------------------------- -------------- ------------ ------------
DIVIDENDS TO COMMON SHAREHOLDERS FROM
NET INVESTMENT INCOME (19,439,768) (9,731,749) (3,354,399)
============================================================== ============== ============ ============
CAPITAL SHARE TRANSACTIONS:
Net proceeds from the sale of common stock 823,703,945 428,317,500 147,473,483
-------------------------------------------------------------- -------------- ------------ ------------
Preferred shares underwriting discount charged to paid-in
capital in excess of par (5,050,000) (2,600,000) (900,000)
-------------------------------------------------------------- -------------- ------------ ------------
Common stock and preferred shares offering costs charged to
paid-in capital in excess of par (1,330,905) (869,007) (483,845)
-------------------------------------------------------------- -------------- ------------ ------------
Reinvestment of dividends 2,386,930 753,488 450,264
-------------------------------------------------------------- -------------- ------------ ------------
Net increase in net assets from capital transactions 819,709,970 425,601,981 146,539,902
-------------------------------------------------------------- -------------- ------------ ------------
Total increase in net assets applicable to
common shareholders 820,414,291 420,527,430 146,590,354
============================================================== ============== ============ ============
NET ASSETS APPLICABLE TO COMMON SHAREHOLDERS:
Beginning of period 100,003 100,003 100,003
-------------------------------------------------------------- -------------- ------------ ------------
End of period $ 820,514,294 400,627,433 146,690,357
============================================================== ============== ============ ============
COMMON SHARES ISSUED AND REINVESTED:
Issued 57,501,148 29,900,000 10,294,833
-------------------------------------------------------------- -------------- ------------ ------------
Issued in reinvestment of dividends 175,089 58,211 30,554
-------------------------------------------------------------- -------------- ------------ ------------
NET INCREASE 57,676,237 29,958,211 10,325,387
============================================================== ============== ============ ============
* Commencement of operations
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
30 PIMCO Municipal Income Funds II Semi-Annual Report | 11.30.02 |
PIMCO MUNICIPAL INCOME FUNDS II NOTES TO FINANCIAL STATEMENTS
November 30, 2002 (unaudited)
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
PIMCO Municipal Income Fund II ("Municipal II"), PIMCO California Municipal
Income Fund II ("California Municipal II") and PIMCO New York Municipal Income
Fund II ("New York Municipal II") collectively referred to as the "Funds" or
"PIMCO Municipal Income Funds II", were organized as Massachusetts business
trusts on March 29, 2002. Prior to commencing operations on June 28, 2002, the
Funds had no operations other than matters relating to their organization and
registration as closed-end management investment companies registered under the
Investment Company Act of 1940 and the rules and regulations thereunder, as
amended, and the sale and issuance of 6,981 shares of beneficial interest of
each Fund at an aggregate purchase price of $100,003 per Fund to Allianz
Dresdner Asset Management of America L.P., ("ADAM"). PIMCO Advisors Fund
Management LLC, formerly PIMCO Funds Advisors LLC, (the "Investment Manager"),
serves as the Fund's Investment Manager and is an indirect, majority-owned
subsidiary of ADAM. ADAM is an indirect, majority-owned subsidiary of Allianz
AG.
Municipal II invests substantially all of its assets in a portfolio of municipal
bonds, the interest from which is exempt from federal income taxes. California
Municipal II invests substantially all of its assets in municipal bonds which
pay interest that is exempt from federal and California income taxes. New York
Municipal II invests substantially all of its assets in municipal bonds which
pay interest that is exempt from federal, New York State and New York City
income taxes. The Funds will seek to avoid bonds generating interest income
which could potentially subject individuals to alternative minimum tax. The
issuers' abilities to meet their obligations may be affected by economic and
political developments in a specific state or region.
Municipal II, California Municipal II and New York Municipal II issued
50,500,000, 26,000,000 and 9,000,000 shares of common stock, respectively, in
their initial public offerings. An additional 7,001,148, 3,900,000 and 1,294,833
shares of Municipal II, California Municipal II and New York Municipal II,
respectively, were issued in connection with the exercises of the underwriters
over-allotment option on July 15, 2002 and August 6, 2002. These shares were all
issued at $15.00 per share before an underwriting discount of $0.675 per share.
Offering costs of $955,905, $569,007 and $308,845 (representing $0.02 per share
for Municipal II and California Municipal II and $0.03 per share for New York
Municipal II), were offset against the proceeds of the offerings and have been
charged to paid-in capital in excess of par. The Investment Manager has agreed
to pay all offering costs (other than the sales load) and organizational
expenses exceeding $0.03 per share for each Fund.
In addition, the underwriters discount and offering costs associated with the
Funds' issuance of Preferred Shares in the amounts of $5,050,000 and $375,000,
$2,600,000 and $300,000 and $900,000 and $175,000, for Municipal II, California
Municipal II and New York Municipal II, respectively, have been charged to
paid-in capital in excess of par.
The preparation of the financial statements in accordance with accounting
principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect the reported amounts
and disclosures in the financial statements. Actual results could differ from
those estimates. The following is a summary of significant accounting policies
consistently followed by the Funds:
(A) VALUATION OF INVESTMENTS
Portfolio securities and other assets for which market quotations are readily
available are valued each day at market value. Market value is generally
determined on the basis of the last reported sales price, or if no sales are
reported, based on quotes obtained from a quotation reporting system,
established market makers, or independent pricing services approved by the Board
of Trustees. Any security or other asset for which market quotations are not
readily available is valued at fair value as determined in good faith under
procedures established by the Board of Trustees.
(B) FEDERAL INCOME TAXES
The Funds intend to distribute all of their taxable income and to comply with
the other requirements of the U.S. Internal Revenue Code of 1986, as amended,
applicable to regulated investment companies. Accordingly, no provision for U.S.
federal income taxes is required. In addition, by distributing substantially all
of their taxable ordinary income and long-term capital gains, if any, during
each calendar year, the Funds intend not to be subject to U.S. federal excise
tax.
(C) INVESTMENT TRANSACTIONS AND INVESTMENT INCOME
Investment transactions are accounted for on the trade date. Realized gains and
losses on investments are determined on the identified cost basis. Interest
income is recorded on an accrual basis. Original issue discounts or premiums on
debt securities purchased are accreted or amortized daily to non-taxable
interest income. Market discounts, if any, are accreted daily to taxable income.
11.30.02 | PIMCO Municipal Income Funds II Semi-Annual Report 31
PIMCO MUNICIPAL INCOME FUNDS II NOTES TO FINANCIAL STATEMENTS
November 30, 2002 (unaudited)
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (CONCLUDED)
(d) DIVIDENDS AND DISTRIBUTIONS--COMMON STOCK
The Funds declare dividends from net investment income monthly to common
shareholders. Distributions of net realized capital gains, if any, are paid at
least annually. Each Fund records dividends and distributions to its
shareholders on the ex-dividend date. The amount of dividends and distributions
from net investment income and net realized capital gains are determined in
accordance with federal income tax regulations, which may differ from generally
accepted accounting principles. These "book-tax" differences are either
considered temporary or permanent in nature. To the extent these differences are
permanent in nature, such amounts are reclassified within the capital accounts
based on their federal income tax treatment; temporary differences do not
require reclassification. To the extent dividends and/or distributions exceed
current and accumulated earnings and profits for federal income tax purposes
they are reported as dividends and/or distributions of paid-in capital in excess
of par.
(e) EXPENSE OFFSET
The Funds benefit from an expense offset arrangement with their custodian bank
whereby uninvested cash balances earn credits which reduce monthly custodian
expenses. Had these cash balances been invested in income producing securities,
they would have generated income for the Funds.
(f) FUTURES CONTRACTS
A futures contract is an agreement between two parties to buy and sell a
financial instrument at a set price on a future date. Upon entering into such a
contract, the Funds are required to pledge to the broker an amount of cash or
securities equal to the minimum "initial margin" requirements of the exchange.
Pursuant to the contracts, the Funds agree to receive from or pay to the broker
an amount of cash equal to the daily fluctuation in the value of the contracts.
Such receipts or payments are known as "variation margin" and are recorded by
the Funds as unrealized appreciation or depreciation. When the contracts are
closed, the Funds record a realized gain or loss equal to the difference between
the value of the contracts at the time they were opened and the value at the
time they were closed. Any unrealized appreciation or depreciation recorded is
simultaneously reversed. The use of futures transactions involves the risk of an
imperfect correlation in the movements in the price of futures contracts,
interest rates and the underlying hedged assets, and the possible inability of
counterparties to meet the terms of their contracts.
Futures contracts outstanding at November 30, 2002 were as follows:
# of Expiration Unrealized
Fund Type Contracts Date Appreciation
--------------------------------------------------------------------------------
Municipal II Short: U.S. Treasury
30 Year Bond 2,500 12/31/02 $11,875,000
2. INVESTMENT MANAGER AND SUB-ADVISER
Each Fund has entered into an Investment Management Agreement (the "Agreements")
with the Investment Manager to serve as Investment Manager to each Fund. Subject
to the supervision of each Fund's Board of Trustees, the Investment Manager is
responsible for managing, either directly or through others selected by it, the
investment activities of the Fund and the Fund's business affairs and other
administrative matters. Pursuant to the Agreements, the Investment Manager will
receive an annual fee, payable monthly, at the annual rate of 0.65% of each
Fund's average daily net assets (including net assets attributable to any
preferred shares that may be outstanding). In order to reduce Fund expenses, the
Investment Manager has contractually agreed to reimburse each Fund for fees and
expenses at the annual rate of 0.15% of the Fund's average daily net assets
(including net assets attributable to any preferred shares that may be
outstanding) from the commencement of operations through June 30, 2007, and for
a declining amount thereafter through June 30, 2009.
The Investment Manager has retained its affiliate, Pacific Investment Management
Company LLC (the "Sub-Adviser") to manage each Fund's investments. Subject to
the supervision of the Investment Manager, the Sub-Adviser makes all investment
decisions with respect to each Fund's assets. The Investment Manager (not the
Funds) pays a portion of the fees it receives to the Sub-Adviser in return for
its services, at the maximum annual rate of 0.50% of each Fund's average daily
net assets (including net assets attributable to any preferred shares that may
be outstanding). The Sub-Adviser has contractually agreed to waive a portion of
the fees it is entitled to receive from the Investment Manager, such that the
Sub-Adviser will receive 0.26% of each Fund's average daily net assets
(including net assets attributable to any preferred shares that may be
outstanding) from the commencement of the Funds' operations through June 30,
2007, and will receive an increasing amount (not to exceed 0.50% of each Fund's
average daily net assets, including net assets attributable to any preferred
shares that may be outstanding) thereafter through June 30, 2009. The Investment
Manager informed the Funds that it paid the Sub-Adviser $1,281,139, $662,665 and
$228,954 in connection with sub-advisory services for Municipal II, California
Municipal II and New York Municipal II, respectively, for the period ended
November 30, 2002.
32 PIMCO Municipal Income Funds II Semi-Annual Report | 11.30.02
PIMCO MUNICIPAL INCOME FUNDS II NOTES TO FINANCIAL STATEMENTS
November 30, 2002 (unaudited)
3. INVESTMENTS IN SECURITIES
For the period ended November 30, 2002, purchases and sales of investments,
other than short-term securities, were as follows:
California New York
Municipal II Municipal II Municipal II
--------------------------------------------------------------------------------
Purchases $1,364,368,936 $759,190,247 $254,968,109
Sales 34,481,094 77,776,708 19,295,247
4. CAPITAL
The Funds have an unlimited amount of $0.00001 par value common stock
authorized.
5. AUCTION PREFERRED SHARES
Municipal II has issued 4,040 shares of Preferred Shares Series A, 4,040 shares
of Preferred Shares Series B, 4,040 shares of Preferred Shares Series C, 4,040
shares of Preferred Shares Series D and 4,040 shares of Preferred Shares Series
E each with a net asset and liquidation value of $25,000 per share plus accrued
dividends.
California Municipal II has issued 2,080 shares of Preferred Shares Series A,
2,080 shares of Preferred Shares Series B, 2,080 shares of Preferred Shares
Series C, 2,080 shares of Preferred Shares Series D and 2,080 shares of
Preferred Shares Series E each with a net asset and liquidation value of $25,000
per share plus accrued dividends.
New York Municipal II has issued 1,800 shares of Preferred Shares Series A and
1,800 shares of Preferred Shares Series B, each with a net asset and liquidation
value of $25,000 per share, plus accrued dividends.
Dividends are accumulated daily at an annual rate set through auction
procedures. Distributions of net realized capital gains, if any, are paid
annually.
For the period ended November 30, 2002, the annualized dividend rates ranged
from:
High Low At 11/30/02
--------------------------------------------------------------------------------
MUNICIPAL II:
Series A 1.65% 1.20% 1.65%
Series B 1.90% 1.20% 1.90%
Series C 1.65% 1.00% 1.60%
Series D 1.75% 1.11% 1.75%
Series E 1.75% 1.20% 1.75%
CALIFORNIA MUNICIPAL II:
Series A 1.50% 1.00% 1.19%
Series B 1.45% 0.80% 1.00%
Series C 1.50% 1.00% 1.10%
Series D 1.50% 1.00% 1.00%
Series E 1.50% 1.00% 1.20%
NEW YORK MUNICIPAL II:
Series A 1.50% 1.00% 1.25%
Series B 1.60% 1.00% 1.25%
11.30.02 | PIMCO Municipal Income Funds II Semi-Annual Report 33
PIMCO MUNICIPAL INCOME FUNDS II NOTES TO FINANCIAL STATEMENTS
November 30, 2002 (unaudited)
5. AUCTION PREFERRED SHARES (CONCLUDED)
The Funds are subject to certain limitations and restrictions while Preferred
Shares are outstanding. Failure to comply with these limitations and
restrictions could preclude the Funds from declaring any dividends or
distributions to common shareholders or repurchasing common shares and/or could
trigger the mandatory redemption of Preferred Shares at their liquidation value.
Preferred Shares, which are entitled to one vote per share, generally vote with
the common stock but vote separately as a class to elect two Trustees and on any
matters affecting the rights of the Preferred Shares.
6. SUBSEQUENT DIVIDEND DECLARATIONS--COMMON SHAREHOLDERS
On December 16, 2002, the following dividends were declared to common
shareholders payable December 31, 2002 to shareholders of record on December 27,
2002:
Municipal II $0.084375 per common share
California Municipal II $0.08125 per common share
New York Municipal II $0.08125 per common share
On December 17, 2002, Municipal Income II declared a short-term and long-term
capital gain distribution of $0.04190 per common share and $0.05150 per common
share, respectively. The distributions were payable on January 10, 2003 to
shareholders of record on December 27, 2002.
On January 15, 2003, the following dividends were declared to common
shareholders payable February 18, 2003 to shareholders of record on January 24,
2003:
Municipal II $0.084375 per common share
California Municipal II $0.08125 per common share
New York Municipal II $0.08125 per common share
7. CHANGE IN INVESTMENT POLICY
On December 17, 2002, the Board of Trustees approved a change in the investment
policy of each Fund to invest, under normal market conditions, at least 90% of
each of its "total" assets in municipal bonds to at least 90% of each of its
"net" assets (and not "total" assets) in municipal bonds.
34 PIMCO Municipal Income Funds II Semi-Annual Report | 11.30.02
PIMCO MUNICIPAL INCOME FUNDS II FINANCIAL HIGHLIGHTS
For a share of common stock outstanding for the period June 28, 2002* through
November 30, 2002 (unaudited)
CALIFORNIA NEW YORK
MUNICIPAL II MUNICIPAL II MUNICIPAL II
---------------------------------------------------------- -------------- -------------- --------------
Net asset value, beginning of period $14.33** $14.33** $14.33**
---------------------------------------------------------- -------------- -------------- --------------
INVESTMENT OPERATIONS:
Net investment income 0.33 0.28 0.31
---------------------------------------------------------- -------------- -------------- --------------
Net realized and unrealized gain (loss) 0.05 (0.09) 0.05
---------------------------------------------------------- -------------- -------------- --------------
Total from investment operations 0.38 0.19 0.36
---------------------------------------------------------- -------------- -------------- --------------
DIVIDENDS ON PREFERRED SHARES FROM
NET INVESTMENT INCOME (0.03) (0.03) (0.03)
---------------------------------------------------------- -------------- -------------- --------------
Net increase in net assets applicable to common
shares resulting from investment operations 0.35 0.16 0.33
---------------------------------------------------------- -------------- -------------- --------------
DIVIDENDS TO COMMON SHAREHOLDERS FROM
NET INVESTMENT INCOME (0.34) (0.33) (0.33)
---------------------------------------------------------- -------------- -------------- --------------
CAPITAL SHARE TRANSACTIONS:
Common stock offering costs charged to paid-in capital
in excess of par (0.02) (0.02) (0.03)
---------------------------------------------------------- -------------- -------------- --------------
Preferred shares offering costs/underwriting discounts
charged to paid-in capital in excess of par (0.10) (0.10) (0.10)
---------------------------------------------------------- -------------- -------------- --------------
Total capital share transactions (0.12) (0.12) (0.13)
---------------------------------------------------------- -------------- -------------- --------------
Net asset value, end of period $14.22 $14.04 $14.20
---------------------------------------------------------- -------------- -------------- --------------
Market price, end of period $14.34 $14.35 $14.22
---------------------------------------------------------- -------------- -------------- --------------
TOTAL INVESTMENT RETURN (1) (2.2)% (2.2)% (3.1)%
---------------------------------------------------------- -------------- -------------- --------------
RATIOS/SUPPLEMENTAL DATA:
Net assets applicable to common shareholders,
end of period (000) $820,514 $420,627 $146,690
---------------------------------------------------------- -------------- -------------- --------------
Ratio of expenses to average net assets (2)(3)(4) 0.84%(5) 0.85%(6) 0.88%(7)
---------------------------------------------------------- -------------- -------------- --------------
Ratio of net investment income to average net assets (2)(4) 5.39%(5) 4.66%(6) 5.09%(7)
---------------------------------------------------------- -------------- -------------- --------------
Preferred shares asset coverage per share $65,612 $65,440 $65,742
---------------------------------------------------------- -------------- -------------- --------------
Portfolio turnover 3% 14% 10%
---------------------------------------------------------- -------------- -------------- --------------
* Commencement of operations
** Initial public offering price of $15.00 per share less underwriting
discount of $0.67 per share.
(1) Total investment return is calculated assuming a purchase of common stock
at the current market price on the first day of the period and a sale at
the current market price on the last day for the period reported. Dividends
are assumed, for purposes of this calculation, to be reinvested at prices
obtained under each Fund's dividend reinvestment plan. Total investment
return does not reflect brokerage commissions or sales charges. Total
investment return for a period of less than one year is not annualized.
(2) Calculated on the basis of income and expenses applicable to both common
and preferred shares relative to the average net assets of common
shareholders.
(3) Inclusive of expenses offset by earning credits from the custodian bank.
(See note 1.(e) in Notes to Financial Statements).
(4) Annualized
(5) During the period indicated above, the Investment Manager waived a portion
of its investment management fee. If such waiver had not been in effect,
the ratio of expenses to average net assets and the ratio of net investment
income to average net assets would have been 1.05% (annualized) and 5.18%
(annualized), respectively.
(6) During the period indicated above, the Investment Manager waived a portion
of its investment management fee. If such waiver had not been in effect,
the ratio of expenses to average net assets and the ratio of net investment
income to average net assets would have been 1.06% (annualized) and 4.45%
(annualized), respectively.
(7) During the period indicated above, the Investment Manager waived a portion
of its investment management fee. If such waiver had not been in effect,
the ratio of expenses to average net assets and the ratio of net investment
income to average net assets would have been 1.09% (annualized) and 4.88%
(annualized), respectively.
| 11.30.02 | PIMCO Municipal Income Funds II Semi-Annual Report 35
(THIS PAGE INTENTIONALLY LEFT BLANK)
TRUSTEES AND PRINCIPAL OFFICERS
Stephen Treadway
Trustee, Chairman, Chairman of the Board
Paul Belica
Trustee
Robert E. Connor
Trustee
John J. Delessandro II
Trustee
Hans W. Kertess
Trustee
R. Peter Sullivan, III
Trustee
Brian S. Shlissel
President & Chief Executive Officer
Newton B. Schott, Jr.
Executive Vice President & Secretary
Mark V. McCray
Vice President
Lawrence G. Altadonna
Treasurer, Principal Financial & Accounting Officer
INVESTMENT MANAGER
PIMCO Advisors Fund Management LLC
1345 Avenue of the Americas
New York, NY 10105
SUB-ADVISER
Pacific Investment Management Company LLC
840 Newport Center Drive
Newport Beach, CA 92660
TRANSFER AGENT, DIVIDEND PAYING AGENT AND REGISTRAR
PFPC Inc.
400 Bellevue Parkway
Wilmington, DE 19809
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP
1177 Avenue of the Americas
New York, NY 10036
LEGAL COUNSEL
Ropes & Gray
One International Place
Boston, MA 02210-2624
This report, including the financial information herein, is transmitted to the
shareholders of PIMCO Municipal Income Fund II, PIMCO California Municipal
Income Fund II and PIMCO New York Municipal Income Fund II for their
information. It is not a prospectus, circular or representation intended for use
in the purchase of shares of the Funds or any securities mentioned in this
report.
Notice is hereby given in accordance with Section 23(c) of the Investment
Company Act of 1940, as amended, that from time to time each Fund may purchase
shares of its common stock in the open market.
The financial information included herein is taken from the records of the Fund
without examination by independent accountants, who did not express an opinion
hereon.
Daily information on the Funds is available at www.pimcoadvisors.com or by
calling 1-800-331-1710.
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